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EXHIBIT 2.1
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ASSET PURCHASE AGREEMENT
among
STAFFMARK, INC.
STAFFMARK ACQUISITION CORPORATION FIVE,
and
XXXXXXXXXX & ASSOCIATES, INC.
XXXX XXXXXXXXXX, Trustee of the
Xxxx Xxxxxxxxxx Revocable Trust Agreement,
Dated February 26, 1996
and XXXX XXXXXXX
* * * * * * * * * * * * * *
Closing Date: April 24, 1997
Effective Date: April 1, 1997
* * * * * * * * * * * * *
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TABLE OF CONTENTS
PAGE
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INDEX TO EXHIBITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
ARTICLE I. PURCHASE AND SALE OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.1. Transfer of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.1.1. Instruments of Conveyance and Transfer . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.1.2. Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.2. Consideration for the Transferred Assets . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.3. Assumption of Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.4. Transfer Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE II. REPRESENTATIONS AND WARRANTIES OF SELLER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.1. Organization and Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.2. Corporate Power and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.3. No Violation; Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.4. Subsidiaries and Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.5. Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.6. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.7. Absence of Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 2.8. Labor and Employee Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 2.9. Real Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.10 Powers of Attorney; Absence of Limitations on Competition; Guarantees . . . . . . . . . . . 7
SECTION 2.11. Significant Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.12. Governmental Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.13. Absence of Certain Changes; Conduct of Business . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.14. Certain Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.15. Compliance with Law; Licenses and Permits . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.16. Employee Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.17. Fixed Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.18. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.19. Outstanding Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.20 Outstanding Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.21. Intellectual Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.22. Proprietary Information of Third Parties . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.23. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.24. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.25. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.26. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.27. Broker's or Finder's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.28. Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.29. Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.30. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.31 Protection of Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF BUYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.1. Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.2. Corporate Power and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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SECTION 3.3. Validity, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.4. Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.5. Governmental Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IV. COVENANTS AND AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 4.1. Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 4.2. Best Efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 4.3. Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 4.4. Investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 4.5. Payment of Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 4.6. Employees and Consultants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 4.7. Obligations Concerning Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4.8. Bulk Transfer Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4.9. Non-Competition Covenant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4.10. Nondisclosure of Confidential Information . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.11. Corporate Names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.12. Non-Competition Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.13. Certain Expenses of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE V. CONDITIONS TO THE BUYER'S OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.1. Representations and Warranties True . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.2. Consents; Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.3. No Obstructive Proceeding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.4. Opinion of Counsel to the Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.5. Closing Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.6. Approval of the Buyer and Its Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5.7. Employment Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 5.8. Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 5.9. Escrow Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 5.11. Additional Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE VI. CONDITIONS TO THE SELLER'S OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 6.1. Representations and Warranties True . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 6.2. Closing Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 6.3. No Obstructive Proceeding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 6.4. Approval of the Seller and Its Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 6.5. Escrow Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 6.6. Employment Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 6.8. Opinion of Counsel to Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 6.9. Additional Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE VII. THE CLOSING AND CERTAIN CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 7.1. Time and Place of Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 7.2. Deliveries by the Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 7.3. Deliveries by the Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VIII. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.1. Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.2. Indemnification by Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.3. Limitation of Certain Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
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SECTION 8.4. Notice to Seller, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 8.5. Indemnification by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 8.6. Notice to the Buyer, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 8.7. Right of Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 8.8. Survival of Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE IX. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 9.1. Knowledge of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 9.2. Knowledge of Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.3. "Person" Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.4. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 9.5. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.6. Modifications and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.7. Assignment/Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.8. Parties in Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.9. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.10. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 9.11. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.12. Headings and Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.13. Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.14. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.15. Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.16. Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.17. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 9.18. Telecopy Execution and Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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INDEX TO EXHIBITS
APPENDIX A -- Calculation of Earnout
EXHIBIT A -- Form of Xxxx of Sale
EXHIBIT B -- Form of Assignment and Assumption Agreement
EXHIBIT C -- Form of Lease Assignment
EXHIBIT D -- Form of Escrow Agreement
INDEX TO SCHEDULES
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Schedule 1.1(a) -- Schedule of Assets
Schedule 1.1(d) -- Employee Agreements
Schedule 1.1.2 -- Excluded Assets
Schedule 1.3 -- Assumed Liabilities
Schedule 1.5 -- Allocation of Purchase Price
Schedule 2.3 -- No Violations; Consents
Schedule 2.6 -- Financial Statements
Schedule 2.7 -- Absence of Undisclosed Liabilities
Schedule 2.8 -- Labor and Employee Relations
Schedule 2.10 -- Powers of Attorney; Absence of Limitations on Competition; Guarantees
Schedule 2.11 -- Significant Customers
Schedule 2.13 -- No Adverse Change
Schedule 2.15 -- Compliance with Law; Licenses and Permits
Schedule 2.16 -- Employee Benefits
Schedule 2.16.1 -- Employees
Schedule 2.17 -- Claims on Fixed Assets
Schedule 2.18 -- Insurance
Schedule 2.19 -- Contracts
Schedule 2.19.1 -- Notice of Contract Defaults
Schedule 2.19.2 -- Termination of Contracts
Schedule 2.19.3 -- Limitations on Contracts
Schedule 2.20 -- Leases
Schedule 2.21 -- Intellectual Properties
Schedule 2.22 -- Proprietary Information of Third Parties
Schedule 2.23 -- Transactions with Affiliates
Schedule 2.24 -- Taxes
Schedule 2.25 -- Litigation
Schedule 2.26 -- Environmental Matters
Schedule 2.27 -- Brokers
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ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered
into this 24th day of April, 1997, by and among STAFFMARK, INC., a Delaware
corporation ("StaffMark"), STAFFMARK ACQUISITION CORPORATION FIVE, a Delaware
corporation and a wholly-owned subsidiary of STAFFMARK ("SAC" and together with
StaffMark, "Buyer"), and XXXXXXXXXX & ASSOCIATES, INC., a Missouri corporation,
("Seller"), and XXXX XXXXXXXXXX, as trustee of the Xxxx Xxxxxxxxxx Revocable
Trust Agreement, dated February 28, 1996, and XXXX XXXXXXX (each individually a
"Stockholder" and collectively, the "Stockholders").
PRELIMINARY STATEMENTS:
The Seller is engaged in the business of providing information
technology staffing services;
Seller is the owner of all right, title and interest in and to the
assets described in Section 1.1 hereto, with such assets being substantially
all of the assets currently used by the Seller in the aforementioned business
conducted by it (the "Business"); and
Seller desires to sell substantially all of its assets to Buyer and
Buyer desires to purchase the assets from Seller, all pursuant to this
Agreement as hereinafter provided.
NOW, THEREFORE, in consideration of the preliminary statements and the
mutual covenants, representations, warranties and agreements contained in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I. PURCHASE AND SALE OF ASSETS
SECTION 1.1. Transfer of Assets. Upon the terms and subject to the
conditions set forth in this Agreement, at the Effective Time (as hereinafter
defined) Seller shall transfer to Buyer, free and clear of all claims, charges,
liens, contracts, rights, options, security interests, mortgages, encumbrances
and restrictions whatsoever (collectively, "Claims"), except such Claims
specifically set forth in Section 1.3 hereof, all of the assets, properties and
rights owned by the Seller or in which the Seller has any right or interest of
every type and description, real, personal and mixed, tangible and intangible,
confirmed or contingent (other than the Excluded Assets as hereinafter defined)
relating to its Business (as more fully described on Schedule 1.1 hereto) and
as reflected on the Seller's balance sheet as of March 31, 1997, and any such
assets acquired prior to and existing as of the Closing, including, without
limitation:
(a) Generally. Cash, accounts receivable, business agreements,
property, equipment, inventory, goodwill, supplier lists, customer lists,
prepaid insurance, licenses and permits, processes, service marks, trade
secrets, computers and computer equipment, files and other records, systems and
processes, security deposits, memberships, contracts, leasehold and other
improvements, machines, machinery, equipment, furniture, fixtures, supplies,
all rights and claims under insurance policies and other contracts of whatever
nature, all causes of action, claims and demands of every nature relating to
the Assumed Liabilities, Contracts and Leases (each as hereinafter defined,
including, but not limited to, the assets listed on Schedule 1.1(a));
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(b) Name and Related Items. The name "Xxxxxxxxxx & Associates" and
any variants thereof and all copyrights, copyright applications, trade names,
trademarks, service marks and logos (whether or not registered) related
thereto; the phone numbers (000) 000-0000 and (000) 000-0000 (St. Louis,
Missouri branch), (000) 000-0000 (Kansas City, Kansas branch), (000) 000-0000
(Twin Cities, Minnesota branch), and (000) 000-0000 (Omaha, Nebraska branch),
and the facsimile numbers (000) 000-0000 (St. Louis, Missouri branch), (913)
469-6532 (Kansas City, Kansas branch), (000) 000-0000 (Twin Cities, Minnesota
branch), and (000) 000-0000 (Omaha, Nebraska branch), and other phone and
facsimile numbers for the Business existing as of Closing.
(c) Agreements and Contracts. All orders, bids, quotations,
contracts, and other agreements with or related to past, present and
prospective clients of the Business and all amendments, updates, customer
files, lists, records, studies, surveys, reports, correspondence and other
similar materials related to the foregoing;
(d) Employee Agreements and Information. All employment agreements
and contracts for those individuals listed on Schedule 1.1(d) (the "Employees")
and all rights thereunder and copies of the information for each Employee as
indicated on such Schedule 1.1(d) and any additional employment agreements or
contracts entered into prior to Closing (collectively, the "Employee
Information"); provided, however, such Employee Information shall only be
transferred to Buyer upon termination of the Employee Leasing Agreement,
executed of even date herewith by the parties hereto (the "Employee Leasing
Agreement");
(e) Records. All books, records, lists and reports, including but
not limited to, resumes and resume files, related to the Business whether or
not currently being utilized by such Business (collectively, the "Records");
(f) Electronic Data. All electronic information and data related
to the Business wherever located (collectively, the "Electronic Data");
(g) Additional Information. All sales, advertising and promotional
literature and materials, advertising and advertising copy and other similar
materials on which solely appears the name and such other materials which are
currently in the possession of Stockholders and the Employees on which appear
the name Xxxxxxxxxx & Associates; and
(h) Other Assets. All other assets, properties and rights of every
kind and nature owned by the Seller and used in the Business (other than the
Excluded Assets as hereinafter defined), and whether or not specifically
referred to in this Agreement;
All with the intention that the Business shall be transferred to the Buyer as a
going concern. All of the foregoing assets shall be referred to collectively as
the "Transferred Assets".
SECTION 1.1.1. Instruments of Conveyance and Transfer.
(a) The Seller shall transfer the Transferred Assets to the Buyer
pursuant to a Xxxx of Sale in substantially the form of Exhibit A, an
Assignment and Assumption Agreement in substantially the form of Exhibit B (the
"Assignment and Assumption Agreement"), a Lease Assignment in substantially the
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form of Exhibit C (the "Lease Assignment"), and such other documents and
instruments as the Buyer or its counsel may reasonably request.
(b) At any time and from time to time after the Closing Date, at
the request of the Buyer, without further consideration, the Seller shall
execute and deliver such other instruments of sale, transfer, conveyance,
assignment and confirmation as may be reasonably requested in order to more
effectively transfer, convey and assign to the Buyer and to confirm the Buyer's
title to the Transferred Assets.
SECTION 1.1.2. Excluded Assets. Notwithstanding any provision of this
Agreement to the contrary, there shall be excluded from the Transferred Assets
and retained by the Seller the following assets (the "Excluded Assets"): All
assets of Seller's previously owned Houston, Texas office and such other assets
as specifically listed on Schedule 1.1.2 hereto.
SECTION 1.2. Consideration for the Transferred Assets. In
consideration for the transfer of the Transferred Assets, upon the terms and
subject to the conditions set forth in this Agreement, the Buyer shall assume
the Assumed Liabilities pursuant to Section 1.3 hereof and shall pay to the
Seller aggregate up-front consideration of $15,250,000 (the "Up-Front Purchase
Price") plus the Earn-Out calculated in accordance with subsection (b) below
(collectively, the "Purchase Price") as follows:
(a) At Closing, Buyer shall deliver to the Seller cash in the
amount of $15,250,000 of which $750,000 will be placed in a
six month escrow with Mercantile Bank National Association,
St. Louis, Missouri, as set forth in the Escrow Agreement in
substantially the form of Exhibit D (the "Escrow"); and
(b) An Earn-Out to be calculated pursuant to the terms of Appendix
A attached hereto.
SECTION 1.3. Assumption of Liabilities. The only obligations and
liabilities to be assumed by the Buyer in connection with its acquisition of
the Transferred Assets are (i) the obligations and liabilities specifically set
forth on Schedule 1.3 attached hereto, including, Seller's accounts payable,
bank line of credit indebtedness, accrued salaries and payroll taxes, and (ii)
the obligations of Seller under all contracts and agreements transferred by
Seller to Buyer under this Agreement; provided that Buyer specifically does not
assume any liabilities of Seller under such contracts or agreements with
respect to any breaches of such contracts or agreements occurring on or before
the Closing Date or any damages to third parties resulting from acts, events or
omissions occurring on or before the Closing Date ("the Assumed Liabilities").
The Assumed Liabilities specifically excludes all liabilities of the previously
owned Houston, Texas office, any notes payable to Stockholders, any Acquisition
Debt (defined below), and any bonuses payable to employees of Seller as a
result of the transactions contemplated by this Agreement, including, but not
limited to, the Agreement set forth on Schedule 2.27.
Buyer shall assume such obligations and liabilities pursuant to the
Assignment and Assumption Agreement and the Lease Assignment. Except for the
Assumed Liabilities, the Seller shall remain liable for the payment of all
other liabilities and obligations related in any manner to the Transferred
Assets or the Businesses which accrue prior or subsequent to the Effective
Date. Except for the Assumed Liabilities in the amount and to the extent
provided in this Section 1.3, the Buyer shall not assume or be responsible for
any other liabilities or obligations which relate in any manner to the
operation of the
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Business prior to the Effective Date, and the Seller shall indemnify, defend,
and hold the Buyer harmless from all of such obligations and liabilities as set
forth in Section 8.2 below.
For purposes of this Agreement, the term Acquisition Debt shall mean
any liability incurred in or related to the purchase or acquisition of any part
of the Business, specifically including, but not limited to, the Promissory
Note, dated January 2, 1996, in the principal amount of $200,000 payable to
Associated Business Consultants, Inc.; monthly non-competition payments
pursuant to those certain Non-Compete Agreements dated January 2, 1996, between
Xxxxxxxxxx & Associates - Twin Cities, Inc., and each of Associated Business
Consultants, Inc., Xxxxxxx Xxxxxxxxx, and Xxxxxx Xxxxxxx; and payments pursuant
to that certain Consulting Agreement dated January 2, 1996 between Xxxxxxxxxx &
Associates - Twin Cities, Inc. and Associated Business Consultants, Inc. A copy
of each of the above-mentioned documents is attached hereto in Schedule 1.3.
SECTION 1.4. Transfer Taxes. Buyer and Seller acknowledge and agree
that for any sales, use, transfer or other similar tax purposes the Purchase
Price is deemed to have been paid by Buyer to Seller pursuant to this Agreement
and includes and is inclusive of any and all sales, use, transfer or other
similar tax imposed as a result of the consummation of the transactions
contemplated by this Agreement. Seller and Stockholders hereby agree to pay and
discharge, and to indemnify Buyer against, and protect, save and hold Buyer
harmless from, any liability, obligation, claim, assessment or deficiency
(whether or not ultimately successful) for any and all sales, use, transfer or
other similar taxes (and any and all interest, penalties, additions to tax and
fines thereon or related thereto) resulting or arising from or incurred in
connection with the consummation of the transactions contemplated by this
Agreement.
SECTION 1.5. Allocation of Purchase Price. The consideration paid
and the liabilities assumed by Buyer pursuant to Sections 1.2 and 1.3 above
shall be allocated among the Transferred Assets purchased hereunder as set
forth on Schedule 1.5 attached hereto. Seller and Buyer each hereby covenant
and agree that none of them will take a position on any income tax return,
before any governmental agency, or in any judicial proceeding that is in any
way inconsistent with the allocation set forth on Schedule 1.5. Each party
shall duly and timely file Form 8594 with its appropriate tax returns.
ARTICLE II. REPRESENTATIONS AND WARRANTIES OF SELLER
As an inducement to the Buyer to enter into this Agreement and to
consummate the transactions contemplated hereby, the Seller and Stockholders,
jointly and severally, represent and warrant to the Buyer as follows:
SECTION 2.1. Organization and Qualification. The Seller is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Missouri. The Seller is duly qualified or otherwise
authorized to transact business and is in good standing in each other
jurisdiction in which such authorization or qualification is required by law.
Seller has made available to the Buyer complete and correct copies of its
Articles of Incorporation and Bylaws as currently in effect.
SECTION 2.2. Corporate Power and Authority. Except as set forth on
Schedule 2.2, the Seller has the corporate power and authority to own and hold
its properties and to carry on its business as now conducted, including the
right to use the name "Xxxxxxxxxx & Associates", and any fictitious
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names currently being used in the geographic areas presently served by it. The
Seller (a) has the full power and authority to execute, deliver and perform
this Agreement, the Exhibits and the Schedules hereto and the other documents
and instruments contemplated hereby (collectively this Agreement, the Exhibits
and Schedules hereto, and the other documents and instruments contemplated
hereby shall constitute the "Documents") and to consummate the transactions
contemplated hereby and thereby, and (b) this Agreement and the other Documents
have been duly and validly executed and delivered by Seller and constitute
valid and binding obligations of the Seller, enforceable against the Seller in
accordance with their terms.
SECTION 2.3. No Violation; Consents. Except as set forth on
Schedule 2.3, neither the execution and delivery of this Agreement or the other
Documents, the consummation of the transactions contemplated hereby or thereby,
nor the performance of this Agreement or the other Documents and such other
agreements in compliance with the terms and conditions hereof and thereof by
the Seller will (i) violate, conflict with or result in any breach of any trust
agreement, Articles of Incorporation, Bylaws, judgment, decree, order, statute
or regulation applicable to the Seller, (ii) violate, conflict with or result
in a breach, default or termination or give rise to any right of termination,
cancellation or acceleration of the maturity of any payment date of any of the
obligations of the Seller or increase or otherwise affect the obligations of
the Seller under any law, rule, regulation or any judgment, decree, order,
governmental permit, license or order or any of the terms, conditions or
provisions of any mortgage, indenture, note, license, agreement or other
instrument or obligation related to the Seller or to the Seller's ability to
consummate the transactions contemplated hereby or thereby, except for such
defaults (or rights of termination, cancellation or acceleration) as to which
requisite waivers or consents have been obtained in writing and provided to the
Buyer, (iii) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to the Seller, (iv) result in the creation of any Claims
upon the Transferred Assets, or (v) require the consent, waiver, authorization
or approval of any federal, state or local government or governmental
department, agency, board, commission, bureau or instrumentality, or public or
self-regulatory body or authority or of any other Person, entity or
organization. The Seller will give any required notices to third parties, and
the Seller and the Stockholders will each use their best efforts to obtain any
third party consents that Buyer may request in connection with the matters
pertaining to the Seller or Stockholders disclosed or required to be disclosed
by this Agreement.
SECTION 2.4. Subsidiaries and Investments. Seller has no
subsidiaries and does not own, directly or indirectly, any capital stock or
other equity or ownership or proprietary interest in any other corporation,
partnership, association, trust, joint venture or other entity.
SECTION 2.5. Books and Records. The minute books of Seller, which
have been and will be made available to the Buyer and its representatives,
contain accurate records of all meetings of and actions or written consents by
the respective officers and directors of the Seller set forth in such minute
books. The Employee Information, the Records and the Electronic Records are
materially true and correct and accurately reflect the operations of the
Business and have been maintained consistent with past practices.
SECTION 2.6. Financial Statements. The Seller has previously
furnished to the Buyer, and attached hereto as Schedule 2.6 are, the audited
balance sheets of Seller as at December 31, 1995 and 1996, the related
statements of income and expenses for the fiscal year then ended, and the
balance sheet of the Seller (the "Balance Sheet") as at March 31, 1997, (the
"Balance Sheet Date") and the related
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statements of income and the expenses for the fiscal period then ended. All
such financial statements (the "Financial Statements") have been prepared in
accordance with GAAP on a consistent basis and were prepared from the books and
records of the Seller. Such books and records are complete and correct in all
material respects, accurately reflect all transactions of the Business, and
have been made available to Buyer for examination. The Financial Statements
fairly present the financial position of the Seller as of the dates thereof and
the results of its operations for the periods ended on the dates thereof.
Except as specifically set forth in this Agreement or in the schedules attached
hereto, since the Balance Sheet Date (i) there has been no Material Change in
the assets, liabilities or financial condition of the assets of the Seller from
that reflected in its Balance Sheet and (ii) none of the business, prospects,
financial condition, operations, property or affairs of the Seller have been
materially adversely affected by any occurrence or development, individually or
in the aggregate, whether or not insured against. The Balance Sheet reflects,
as of the Balance Sheet Date, all liabilities, debts and obligations of any
nature of Seller related to the Business and the Transferred Assets, whether
accrued, absolute, contingent or otherwise, and whether due, or to become due,
including, but not limited to, liabilities, debts or obligations on account of
taxes or other governmental charges or penalties, interest or fines thereon or
in respect thereof, to the extent such items are required to be reflected on
such Balance Sheet under GAAP. The Seller has disclosed to the Buyer all
material facts relating to the preparation of the Financial Statements. For
purposes of this section, "Material Change" shall mean a change in any line
item on the Seller's Balance Sheet incurred or changed outside the ordinary
course of business. The Seller maintains an adequate worker's compensation
reserve on the Balance Sheet in accordance with GAAP or has adequate coverage
under a full-premium policy and represents and warrants there will be no
unrecorded liability for which the Buyer will be liable. All referral fees and
commissions due to employees for all periods ending prior to the Closing Date
have been properly paid or accrued on the Balance Sheet.
SECTION 2.7. Absence of Undisclosed Liabilities.
(a) Except as and to the extent of the amounts specifically
reflected or reserved against in the Balance Sheet or except as set forth on
Schedule 2.7, the Seller has no liabilities or obligations of any nature
whatsoever due or to become due, accrued, absolute, contingent or otherwise,
except for liabilities and obligations incurred since the Balance Sheet Date in
the ordinary course of business. The Seller does not know of any basis for the
assertion against the Seller of any liability or obligation not fully reflected
or reserved against on the Balance Sheet.
(b) The Seller is not bound by any agreement, or subject to any
charter or other corporate restriction or any legal requirement, which has, or
in the future can reasonably be expected to have, a material adverse effect on
the business or prospects of the Seller.
SECTION 2.8. Labor and Employee Relations. The Seller is not a
party to or bound by any collective bargaining agreement with any labor
organization, group or association covering any of its employees, and Seller
has no knowledge of any attempt to organize the Seller's employees by any
Person, unit or group seeking to act as its bargaining agent. Except as set
forth in Schedule 2.8, there are no pending or, to the best knowledge of
Seller, threatened charges (by employees, their representatives or governmental
authorities) of unfair labor practices or of employment discrimination or of
any other wrongful action with respect to any aspect of employment of any
person employed or formerly employed by the Seller. No union representation
election relating to employees of the Seller has been scheduled by any
governmental agency or authority, no organization effort is being made with
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respect to any of such employees, and there is no investigation of the Seller's
employment policies or practices by any governmental agency or authority
pending or threatened. The Seller is not currently, nor has it been, involved
in labor negotiations with any unit or group seeking to become the bargaining
unit for any employees of the Seller. The Seller has not experienced any
material work stoppages, and to the best knowledge of Seller, no work stoppage
is planned.
SECTION 2.9. Real Property. The Seller owns no real property.
SECTION 2.10 Powers of Attorney; Absence of Limitations on
Competition; Guarantees. Except as set forth in Schedule 2.10, (i) no power of
attorney or similar authorization given by the Seller presently is in effect or
outstanding; (ii) no contract or agreement to which the Seller is a party or is
bound or to which the Seller's properties or assets is subject limits the
freedom of the Seller to compete in any line of business or with any Person;
and (iii) the Seller is not a party to or bound by any guarantee of any debt or
obligation of any other Person.
SECTION 2.11. Significant Customers. Set forth on Schedule 2.11 is a
true and correct list of the Seller's ten largest customers for the most recent
twelve month period ending December 31, 1996, together with the amount of
services attributable to such customers expressed in dollars. None of the
customers identified on Schedule 2.11 has terminated, materially reduced or
threatened to terminate or materially reduce its request for services of the
Seller during the period covered by such schedule or prior to the Closing Date.
SECTION 2.12. Governmental Approvals. No registration or filing
with, or consent or approval of or other action by, any Federal, state or other
governmental agency or instrumentality is or will be necessary for the valid
execution, delivery and performance by the Seller of this Agreement.
SECTION 2.13. Absence of Certain Changes; Conduct of Business.
Except as set forth on Schedule 2.13 during the period from the Balance Sheet
Date to and including the date of this Agreement:
(a) Seller has not canceled any indebtedness owing to it or any
claims that it might have possessed, waived any material
rights of substantial value or sold, leased, encumbered,
transferred, or otherwise disposed of, or agreed to sell,
lease, encumber, or otherwise dispose of its assets or
permitted any of its assets to be subjected to any mortgage,
pledge, lien, security interest, encumbrance, restriction or
charge of any kind.
(b) Seller has not made any changes in the types, nature,
composition or quality of the services of the Business and
there has not been any material adverse change in the sales,
revenue or net income of the Business;
(c) Seller has not entered into any agreement, contract, lease, or
license (or series of related agreements, contracts, leases
and licenses) with respect to the Business involving more than
$7,500 or outside the ordinary course of business;
(d) no party (including Seller) has accelerated, terminated,
modified, or canceled any agreement, contract, lease, or
license (or series of related agreements, contracts, leases,
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and licenses) to which Seller is a party or by which it is
bound involving more than $7,500 or outside the ordinary
course of business;
(e) Seller has not allowed any Claims to be imposed upon any of
its assets, tangible or intangible outside the ordinary course
of business;
(f) Seller has not made any capital expenditure (or series of
related capital expenditures) either involving more than
$7,500 or outside the ordinary course of business;
(g) Seller has not made any capital investment in, any loan to, or
any acquisition of the securities or assets of, any other
Person (or series of related capital investments, loans, and
acquisitions);
(h) Seller has not issued, or agreed to issue, any note, bond, or
other debt security or created, incurred, assumed, or
guaranteed any indebtedness for borrowed money or capitalized
lease obligation either involving more than $1,000 or outside
the ordinary course of business;
(i) Seller has not delayed or postponed the payment of accounts
payable and other liabilities outside the ordinary course of
business;
(j) Seller has not canceled, compromised, waived, or released any
right or claim (or series of related rights and claims) either
involving more than $7,500 or outside the ordinary course of
business;
(k) Seller has not granted any license or sublicense of any rights
under or with respect to patents, trademarks or copyrights;
(l) Seller has not accelerated collection of accounts receivables
through special inducements or outside the ordinary course of
business;
(m) Seller has not issued, sold or otherwise disposed of any of
its capital stock, or granted any options, warrants, or other
rights to purchase or obtain (including upon conversion,
exchange or exercise) any of its capital stock;
(n) Seller has not declared, set aside, or paid any dividend or
made any distribution with respect to its stockholders
(whether in cash or in kind) or redeemed, purchased, or
otherwise acquired any of its capital stock;
(o) Seller has not experienced any damage, destruction, or loss
(whether or not covered by insurance) to its property;
(p) Seller has not made any loan to, or entered into any other
transaction with, any of its directors, officers, and
employees outside the ordinary course of business;
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(q) Seller has not entered into any employment contract or
collective bargaining agreement, written or oral, or modified
the terms of any existing such contract or agreement;
(r) Seller has not granted any increase in the base compensation
of any of its directors, officers, and employees outside the
ordinary course of business;
(s) Seller has not adopted, amended, modified or terminated any
bonus, profit sharing, incentive, severance, or other plan,
contract, or commitment for the benefit of any of its
directors, officers, and employees (or taken any such action
with respect to any other Employee Benefit Plan);
(t) Seller has not made any other change in employment terms for
any of its directors, officers, and employees outside the
ordinary course of business; or
(u) Seller has not agreed, whether or not in writing, to do any of
the foregoing.
SECTION 2.14. Certain Practices. Neither the Seller, nor any of its
directors or officers, nor to the best knowledge of Seller, its employees have,
directly or indirectly, used any corporate funds for unlawful contributions,
gifts, entertainment, or other unlawful expenses relating to political
activity; made any unlawful payment to foreign or domestic political activity;
made any unlawful payment to foreign or domestic government officials or
employees or to foreign or domestic political parties or campaigns from
corporate funds; violated any provision of the Foreign Corrupt Practices Act of
1977, as amended; established or maintained any unlawful or unrecorded fund of
corporate monies or other assets; made any false or fictitious entry on the
books or records of the Seller or any subsidiary; made any bribe, rebate,
payoff, influence payment, kickback, or other unlawful payment; given any favor
or gift which is not deductible for federal income tax purposes; or made any
bribe, kickback, or other payment of a similar or comparable nature, whether
lawful or not, to any person or entity, private or public, regardless of form,
whether in money, business or to obtain special concessions, or to pay for
favorable treatment for business secured or for special concessions already
obtained.
SECTION 2.15. Compliance with Law; Licenses and Permits. Except as
set forth on Schedule 2.15, the Seller has complied in all material respects
with all laws, ordinances, legal requirements, rules, regulations and orders
applicable to it, its operations, properties, assets, products and services.
Except as set forth on Schedule 2.15, there is no existing law, rule,
regulation or order, whether federal, state or local, which would prohibit or
materially restrict the Buyer from, or otherwise materially adversely affect
the Buyer in, conducting the Business in the manner heretofore conducted by the
Seller in any jurisdiction in which the Business is now conducted. The Seller
possesses all franchises, permits, licenses, certificates and consents required
from any governmental or regulatory authority in order for the Seller to carry
on its business as currently conducted and to own and operate its properties
and assets as now owned and operated. All of such licenses and permits are in
full force and effect and true and correct copies of all such licenses and
permits are included in Schedule 2.15 hereto. All such licenses and permits
that are subject to transfer are included in the Transferred Assets.
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SECTION 2.16. Employee Benefits.
(a) Set forth on Schedule 2.16 is a list of all pension, profit
sharing, retirement, deferred compensation, stock purchase, stock option,
incentive, bonus, vacation, severance, disability, hospitalization, medical
insurance, life insurance, fringe benefit, welfare and other employee benefit
plans, programs or arrangements pursuant to which the Seller or its ERISA
Affiliates provides (directly or indirectly, individually or jointly through
others) benefits or compensation to or on behalf of employees or former
employees of the Seller or its ERISA Affiliates, whether formal or informal,
whether or not written ("Employee Plan"). On request by the Buyer, the Seller
shall furnish a copy of each Employee Plan and a copy of any related materials.
The Seller will maintain the benefits listed on Schedule 2.16 in full force and
effect through the termination of the Employee Leasing Agreement. Except as set
forth in the Employee Leasing Agreement, the Buyer shall not have any
obligation or liability of any kind or nature for any compensation or benefits
of any kind or nature to the employees or consultants of the Seller for
services rendered prior to the termination of the Employee Leasing Agreement.
Schedule 2.16.1 hereto sets forth a true and complete list of the names and
current compensation paid by Seller to each corporate or administrative
employee and each consultant utilized in connection with the operation of the
Business.
(b) Each Employee Plan covering any present or former employee of
the Seller which is subject to the continuation health coverage requirements of
Section 4980B of the Code or Section 601 of ERISA or any applicable state law
has complied with all such requirements for continuation coverage.
(c) Except as set forth on Schedule 2.16, there are no actions,
suits or claims pending (other than routine claims for benefits) or threatened
against or with respect to any Employee Plan or the assets of any Employee
Plan.
(d) Each Employee Plan (and the related trust or funding vehicle,
if any) has been administered and maintained in material compliance with its
terms and with applicable law. Except as set forth on Schedule 2.16, each
Employee Plan which is intended to be qualified under Section 401 of the Code
and each amendment to such plan is subject to a favorable determination letter
from the Internal Revenue Service and each such plan has at all times been
maintained, by its terms and in operation, in material compliance with Section
401 of the Code. Except with respect to the Flexible Benefit Spending Account,
the assets of each Employee Plan which is not funded through the general assets
of the Seller are at least equal to the liabilities under such Employee Plan,
and all assets of each Employee Plan are shown on the books and records of such
Employee Plan at fair market value. No Employee Plan has unfunded liabilities
that as of the Closing Date are not accurately and fully reflected on the
Seller's Balance Sheet.
(e) Neither the Seller nor any of its ERISA Affiliates is or has
been a participant in, or is or has been obligated to maintain or to make
contributions to, a multi-employer plan (within the meaning of ERISA Section
3(37) and ERISA Section 40001(a)(3)) or an Employee Plan which is subject to
Title IV of ERISA. Neither the Seller nor any ERISA Affiliate has sponsored,
contributed to or been obligated under Title I or IV of ERISA to contribute to
a "defined benefit plan" (as defined in ERISA Section 3(35)). The Seller is not
obligated to provide post-retirement medical benefits or any other unfunded
post-retirement welfare benefits to or on behalf of any persons whatsoever
(except the benefits pursuant
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to the continuation health coverage requirements under Section 4980B of the
Code, ERISA Section 601, or applicable state law).
(f) Neither the Seller nor its ERISA Affiliates is subject to and,
to the best knowledge of Seller, no facts exist which could subject the Seller
or any of its ERISA Affiliates to, any liability whatsoever which is directly
or indirectly related to any Employee Plan, including, but not limited to,
liability for benefit payments or related claims, any liability for any tax or
related penalty under the Code, or liability for any damages or penalties
arising under Title I or Title IV of ERISA other than claims for medical
benefits or distribution requests processed in the normal course of business.
No reportable event under Section 4043 of ERISA, has occurred or, to the best
knowledge of the Seller, will occur with respect to such Employee Plan.
(g) Termination of or withdrawal from any Employee Plan
immediately after the Closing Date would not subject the Buyer to any
liability, tax or penalty whatsoever.
(h) The execution or performance of the transactions contemplated
by this Agreement will not create, accelerate or increase any obligations under
the Employee Plans, including any obligation to make any payment which would
not be deductible as an excess golden parachute payment under Section 280G of
the Code.
(i) All contributions to or under each Employee Plan and all
expenses of each Employee Plan are fully deductible for income tax purposes for
the taxable year for which such contributions are made or such expenses are
paid. All contributions to or under each Employee Plan have been made when due
under the terms of such Employee Plan in accordance with applicable law.
(j) Neither the Seller nor its ERISA Affiliates have entered into
any contract, agreement or arrangement (whether oral or written) under which
the Seller or its ERISA Affiliates have assumed any liability relating to its
clients' retirement plans, nor have the Seller and/or its ERISA Affiliates made
any verbal representations that the use of any employees of the Seller or its
ERISA Affiliates would have no adverse consequence on such client retirement
plans.
(k) Seller has not engaged in employee leasing as defined in this
Section 2.16(k). Employee leasing is defined solely for purposes of this
Section 2.16(k) to mean the placement by an employer (customer) of all or most
of its existing work force onto the payroll of an employee leasing firm and an
explicit co-employment relationship following the termination-lease back.
(l) For purposes of this Section 2.16, the term "ERISA" shall mean
the Employee Retirement Income Security Act of 1974, as amended, and the term
"ERISA Affiliate" shall mean each trade or business (whether or not
incorporated) which together with the Seller is treated as a single employer
under Section 414(b), (c), (m), (o) or (t) of the Code.
(m) All obligations of Seller to employees under each Employee
Plan for all periods ending prior to the Closing Date have been properly paid
or accrued on the Balance Sheet.
SECTION 2.17. Fixed Assets. Except as shown on Schedule 2.17, the
Seller has good and marketable title to all of the Transferred Assets, free and
clear of all claims, liens, mortgages, charges
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and encumbrances. All of the Transferred Assets, whether owned or leased, shall
be transferred in their current condition on an "AS IS" basis, and Seller makes
no warranty as to the condition or suitability of such assets.
SECTION 2.18. Insurance. The Seller is, and will be through the
Closing Date, insured with insurers in respect of its properties, assets and
businesses as set forth on the attached Schedule 2.18. Schedule 2.18 lists the
insurance coverage carried by the Seller, which insurance will remain in full
force and effect with respect to all events occurring prior to the Closing Date
and, in the case of Workers' Compensation insurance, for all events occurring
prior to the termination of the Employer Leasing Agreement. Except as set forth
on Schedule 2.18, the Seller (i) has not failed to give any notice or present
any claim under any such policy or binder in due and timely fashion, (ii) has
not received notice of cancellation or non-renewal of any such policy or
binder, (iii) is not aware of any threatened or proposed cancellation or
non-renewal of any such policy or binder, (iv) has not received notice of any
insurance premiums which will be materially increased in the future, and (v) is
not aware of any insurance premiums which will be materially increased in the
future. There are no outstanding claims under any such policy which have gone
unpaid for more than 45 days, or as to which the insurer has disclaimed
liability.
SECTION 2.19. Outstanding Contracts. Schedule 2.19 sets forth a
description of all existing contracts, agreements, leases, commitments,
licenses and franchises, which involve obligations or commitments by the Seller
of $10,000 or more and are not cancelable by the Seller without penalty within
30 days (collectively "Contracts"), whether written or oral, relating to the
Seller. Seller has delivered or made available to the Buyer true, correct and
complete copies of all of the Contracts specified on Schedule 2.19 which are in
writing, and such schedule sets forth a complete description of all Contracts
which are not in writing. All of the Contracts are in full force and effect and
enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be subject to or affected by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium, or other laws
relating to or affecting the rights of creditors generally. Except as set forth
on Schedule 2.19.1, the Seller and, to the best knowledge of Seller, each other
party thereto have materially performed all the obligations required to be
performed by it, have received no notice of default and are not in default
(with due notice of lapse of time or both) under any of the Contracts. The
Seller has no present expectation or intention of not fully performing all its
obligations under each of the Contracts, and Seller has no knowledge of any
breach or anticipated breach by the other party to any of the Contracts to
which the Seller is a party. Except as set forth on Schedule 2.19.2, none of
the Contracts has been terminated; no notice has been given by any party
thereto of any alleged default by any party thereunder; and Seller is not aware
of any intention or right of any party to declare another party to any of the
Contracts to be in default. Except as set forth on Schedule 2.19.3, there
exists no actual or, to the best knowledge of Seller, threatened termination,
cancellation or limitation of the business relationship of the Seller by any
party to any of the Contracts.
SECTION 2.20 Outstanding Leases. Schedule 2.20 sets forth a
description of each agreement by which the Seller leases each parcel of real
property (the "Leased Parcels") used in connection with the Business
(collectively, the "Leases"). Seller has delivered or made available to the
Buyer true, correct and complete copies of all of the Leases specified on
Schedule 2.20. All rents due under the Leases have been paid. All of the Leases
are in full force and effect and enforceable in accordance with its terms,
except to the extent that the enforceability thereof may be subject to or
affected
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by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium, or other laws relating to or affecting the rights of creditors
generally. Except as set forth on Schedule 2.20, the Seller and to the best
knowledge of Seller, each other party thereto have performed all the
obligations required to be performed by it, have received no notice of default
and are not in default (with due notice or lapse of time or both) under any of
the Leases. The Seller has no present expectation or intention of not fully
performing all its obligations under each of the Leases, and Seller has no
knowledge of any breach or anticipated breach by the other party to any of the
Leases. Except as set forth on Schedule 2.20, none of the Leases has been
terminated; no notice has been given by any party thereto of any alleged
default by any party thereunder; and the Seller is not aware of any intention
or right of any party to declare another party to any of the Leases to be in
default. There exists no actual or, to the best knowledge of Seller, threatened
termination, cancellation or limitation of the business relationship of the
Seller with any party to any of the Leases.
SECTION 2.21. Intellectual Properties. Schedule 2.21 contains an
accurate and complete list of all domestic and foreign letters, patent,
patents, patent applications, patent licenses, software licenses and know-how
licenses, trade name, trademarks, copyrights, unpatented inventions, service
marks, trademark registrations and applications, service xxxx registrations and
applications and copyright registrations and applications, trade secrets or
other confidential proprietary information owned or used by the Seller in the
operation of the Business (collectively the "Intellectual Property"). Except as
set forth on Schedule 2.21 and except for commercial software licensed for use
on personal computers, the Seller owns the entire right, title and interest in
and to the Intellectual Property, trade secrets and technology used in the
operation of its Business and each item constituting part of the Intellectual
Property which is owned by the Seller has been, to the extent indicated in
Schedule 2.21, duly registered with, filed in or issued by, as the case may be,
the United States Patent and Trademark office or such other government
entities, domestic or foreign as are indicated in Schedule 2.21 and such
registrations, filings and issuances remain in full force and effect. There are
no pending or, to the best knowledge of the Seller, threatened proceedings or
litigation or other adverse claims affecting or with respect to the
Intellectual Property. There is, to the best knowledge of the Seller, no
reasonable basis upon which a claim may be asserted against the Seller for
infringement of any domestic or foreign letters patent, patents, patent
applications, patent licenses and know-how licenses, trade names, trademark
registrations and applications, common law trademarks, service marks, service
xxxx registrations or applications copyrights, copyright registrations or
applications, trade secrets or other confidential proprietary information. To
the best knowledge of the Seller, no Person is infringing the Intellectual
Property.
SECTION 2.22. Proprietary Information of Third Parties. Except as
disclosed on Schedule 2.22, no third party has claimed or, to the best
knowledge of Seller, has reason to claim that any Person employed by or
consulting with the Seller ("Related Person") has (i) violated or may be
violating any of the terms or conditions of such person's employment,
non-competition or non-disclosure agreement with such third party, (ii)
disclosed or may be disclosing or utilized or may be utilizing any trade secret
or proprietary information or documentation of such third party, or (iii)
interfered or may be interfering in the employment relationship between such
third party and any of its present or former employees. No third party has
requested information from the Seller which suggests that such a claim might be
contemplated. Except as disclosed on Schedule 2.22, to the best knowledge of
Seller, no related person has employed or proposes to employ any trade secret
or any information or documentation proprietary to any former employer and, no
Related Person has violated any confidential relationship which such
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person may have had with any third party, in connection with the development,
or sale of any service of the Seller, and Seller has no reason to believe there
will be any such employment or violation.
SECTION 2.23. Transactions with Affiliates. Except as disclosed on
Schedule 2.23, no stockholder, director, or executive officers of the Seller,
or member of the family of any such person, or any corporation, partnership,
trust or other entity in which any such person, or any member of the family of
any such person, has a beneficial interest greater than 5% or is an officer,
director, trustee, partner or holder of any equity interest greater than 5%, is
a party to any transaction with the Seller, including any contract, agreement
or other arrangement providing for the employment of, furnishing of services
by, rental of real or personal property from or otherwise requiring payments or
involving other obligations to any such person or firm.
SECTION 2.24. Taxes. Except as set forth on Schedule 2.24, all
federal, state, local and foreign tax returns and tax reports required to be
filed by the Seller on or before the date hereof have been timely filed with
the appropriate governmental agencies in all jurisdictions in which such
returns and reports are required to be filed and all amounts shown as owing
thereon have been paid. All taxes (including, without limitation, income,
accumulated earnings, property, sales,use, franchise, value added, fuel,
employees' income withholding and social security taxes) which have become due
or payable or are required to be collected by the Seller or are otherwise
attributable to any periods ending on or before the Effective Date and all
interest and penalties thereon, whether disputed or not, have been paid or will
be paid in full or adequately reflected on the Balance Sheet or the Seller's
books and records on or prior to the Effective Time. Except as set forth on
Schedule 2.24, all deposits required by law to be made by the Seller with
respect to employees' withholding taxes have been duly made, and as of the
Effective Time all such deposits due will have been made. The Seller has
delivered to the Buyer true and complete copies of all of Seller's state and
federal income tax returns for the fiscal periods ended December, 1995 and 1994
and all reports and results of income tax audits, if any, related thereto.
Except as set forth on Schedule 2.24, no examination of any tax return of the
Seller is currently in progress. There are no outstanding agreements or waivers
extending the statutory period of limitations applicable to any such tax
return.
SECTION 2.25. Litigation. Except as set forth on Schedule 2.25,
there is no (i) action, suit, claim, proceeding or investigation pending or, to
the best knowledge of the Seller, threatened against or affecting the Seller
(whether or not Seller is a party or prospective party thereto), at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, (ii) arbitration proceeding pending relating to the Seller or (iii)
governmental inquiry pending or threatened against or involving the Seller, and
Seller knows of no basis for any of the foregoing. The Seller has not received
any opinion or memorandum or legal advice from legal counsel to the effect that
it is exposed, from a legal standpoint, to any liability or disadvantage which
may be material to the business, prospects, financial condition, operations,
property or affairs of the Seller. There are no outstanding orders, writs,
judgments, injunctions or decrees served upon the Seller by any court,
governmental agency or arbitration tribunal against the Seller. To the best
knowledge of Seller, there are no facts or circumstances which may result in
institution of any action, suit, claim or legal administrative or arbitration
proceeding or investigation against, involving or affecting the Seller or the
transactions contemplated hereby. The Seller is not in default with respect to
any order, writ, injunction or decree known to or served upon it from any court
or of any federal, state, municipal or other governmental department,
commission, board, bureau, agency
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or instrumentality, domestic or foreign. Except as disclosed on Schedule 2.25,
there is no action or suit by the Seller pending or threatened against others.
SECTION 2.26. Environmental Matters. The Seller and, to the best
knowledge of Seller, all Leased Parcels are in compliance with all applicable
laws, rules, regulations, orders, ordinances, judgments and decrees of all
governmental authorities with respect to all environmental statutes, rules and
regulations. Except as set forth on Schedule 2.26, the Seller has not received
notice of, nor does the Seller have knowledge of, any past, present or future
events, conditions, circumstances, activities, practices, incidents, actions or
plans of the Seller or the Seller's predecessors, either collectively,
individually or severally, which may interfere with or prevent continued
compliance with, or which may give rise to any common law or legal liability or
otherwise form the basis of any claim, action, suit, proceeding, hearing, or
investigation, based on or related to the disposal, storage, handling,
manufacture, processing, distribution, use, treatment or transport, or the
emission, discharge, release or threatened release into the environment, of any
substance. As used in this Section 2.26, the term "Substance" or "Substances"
shall mean any pollutant, hazardous substance, hazardous material, hazardous
waste or toxic waste, as defined in any presently enacted federal, state or
local statute or any regulation that has been promulgated pursuant thereto. No
part of any of the Leased Parcels has been listed or proposed for listing on
the National Priorities List established by the United States Environmental
Protection Agency, or any other such list by any federal, state or local
authorities.
SECTION 2.27. Broker's or Finder's Fees. Except as set forth on
Schedule 2.27, no agent, broker, person or firm acting on behalf of the Seller
is, or will be, entitled to any commission or broker's or finder's fees from
the Seller or from any person controlling, controlled by or under common
control with the Seller in connection with any of the transactions contemplated
herein.
SECTION 2.28. Disclosure. All Documents delivered or to be delivered
by the Seller, and to the best knowledge of Seller all Documents delivered or
to be delivered on behalf of the Seller, in connection with this Agreement and
the transactions contemplated hereby are true, complete and correct in all
material respects. To the best knowledge of Seller, neither this Agreement, nor
any of the other Documents contains any untrue statement of a material fact or
omits a material fact necessary to make the statements made by the Seller
herein or therein, in light of the circumstances in which made, not misleading.
To the best knowledge of Seller, there is no fact which materially and
adversely affects the business, prospects or financial condition of the Seller
or its properties or assets, which has not been set forth in the Documents.
SECTION 2.29. Accounts Receivable. All accounts receivable of the
Seller that are reflected on the Balance Sheet on the Balance Sheet Date or on
the accounting records of the Seller as of the Closing Date (collectively, the
"Accounts Receivable") represent or will represent valid obligations arising
from sales actually made or services actually performed in the ordinary course
of business. Unless paid prior to the Closing Date, the net Accounts Receivable
are or will be as of the Closing Date current and collectible. Each of the
Accounts Receivable either has been or will be collected in full, without any
set-off, within one hundred twenty (120) days after the day on which it first
becomes due and payable. After such 120 day period, the Buyer shall re-assign
such accounts to the Seller for collection and Seller shall reimburse Buyer (by
direct payment or set-off of Escrow) for the balance of such uncollectible
account. There is no contest, claim, or right of set-off, other than returns in
the
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ordinary course of business, under any contract with any obligor of any
Accounts Receivable relating to the amount or validity of such Accounts
Receivable.
SECTION 2.30. Intentionally omitted.
SECTION 2.31 Protection of Creditors. The transfer to Buyer by the
Seller of the Transferred Assets does not and will not constitute a fraudulent
transfer or fraudulent conveyance under any applicable state or federal law or
regulation or under any similar laws relating to creditors' rights generally.
The Purchase Price constitutes fair and adequate consideration for the
Transferred Assets. The Seller has not entered into this agreement or made any
transfer or incurred any obligations hereunder or in connection herewith, with
actual intent to disturb, hinder, delay or defraud either present or future
creditors or other persons.
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF BUYER
As an inducement to the Seller to enter into this Agreement and to
consummate the transactions contemplated hereby, the Buyer represents and
warrants to the Seller as follows:
SECTION 3.1. Organization. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and is duly qualified to transact business as a foreign corporation in each
jurisdiction in which the failure to so qualify would have a material adverse
impact on the Buyer's ability to purchase the Businesses pursuant to this
Agreement and perform its obligations under this Agreement.
SECTION 3.2. Corporate Power and Authority. The Buyer has the
corporate power and authority to execute, deliver and perform this Agreement
and the other Documents. The execution, delivery and performance of the
Documents contemplated hereby and the consummation of the transactions
contemplated hereby and thereby have been duly authorized and approved by all
necessary corporate action of the Buyer. The Documents to be executed and
delivered by the Buyer have been duly executed and delivered by, and constitute
the legal, valid and binding obligation of the Buyer enforceable against the
Buyer in accordance with their terms.
SECTION 3.3. Validity, Etc. Neither the execution and delivery by
the Buyer of this Agreement and the other Documents, the consummation by the
Buyer of the transactions contemplated hereby or thereby, nor the performance
by the Buyer of this Agreement and such other agreements in compliance with the
terms and conditions hereof and thereof will: (i) violate, conflict with or
result in any breach of any trust agreement, articles of incorporation, bylaw,
judgment, decree, order, statute or regulation applicable to the Buyer, (ii)
violate, conflict with or result in a breach, default or termination (or give
rise to any right of termination, cancellation or acceleration) under any law,
rule or regulation or any judgment, decree, order, governmental permit, license
or order or any of the terms, conditions or provisions of any mortgage,
indenture, note, license, agreement or other instrument to which the Buyer is a
party, or (iii) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to the Buyer.
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SECTION 3.4. Disclosure. All Documents delivered or to be delivered
by or on behalf of the Buyer in connection with this Agreement and the
transactions contemplated hereby are true, complete and correct in all material
respects. Neither this Agreement, nor any of the Documents, contains any untrue
statement of a material fact or omits a material fact necessary to make the
statements made by Buyer herein or therein, in light of the circumstances in
which made, not misleading. There is no fact which may have a material adverse
effect on the Buyer's ability to pay or otherwise perform its obligations under
this Agreement, which has not been set forth in the Documents.
SECTION 3.5. Governmental Approvals. No registration or filing
with, or consent or approval of or other action by, any Federal, state or other
governmental agency or instrumentality is or will be necessary for the valid
execution, delivery and performance by the Buyer of this Agreement.
SECTION 3.6. Negotiations. Without limiting any of Seller's
representations, warranties, or covenants herein, Buyer hereby acknowledges the
following:
(a) As of the Closing, (i) Buyer has had an opportunity to examine
the assets and liabilities of Seller; (ii) Buyer has asked Seller questions
related to the Business, and Seller has answered all such questions; and (iii)
Seller has provided Buyer with the information Buyer has requested;
(b) There are substantial risks associated herewith which may
influence the success or failure of the venture contemplated herein;
(c) The terms and conditions of this Asset Purchase Agreement are
fair and equitable;
(d) The terms agreed upon between the parties have been
established through an arms-length negotiation; and
(e) The parties reached the terms, conditions, and consideration
after the Buyer had made an independent judgment as to the value of said assets
and then by negotiations between the parties, and Buyer has been represented by
legal counsel who has participated in the drafting hereof.
ARTICLE IV. COVENANTS AND AGREEMENTS
SECTION 4.1. Cooperation. Each of the parties hereto shall use its
best efforts in good faith to perform and fulfill all conditions and
obligations to be fulfilled or performed by it hereunder to the end that the
transactions contemplated hereby will be fully and timely consummated.
SECTION 4.2. Best Efforts. Seller and Buyer shall each use its best
efforts to procure upon reasonable terms and conditions all consents and
approvals, completion of all filings, all registrations and certificates, and
satisfaction of all other requirements prescribed by law which are necessary
for the consummation of the transactions contemplated by this Agreement and the
Buyer's ownership and operation of the Seller's Business after the Closing
Date. Prior to the Closing Date, the Seller will use commercially reasonable
efforts to preserve its relationships with its employees, customers and others
having business relationships with the Seller and will maintain the Employee
Information, the
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Records and the Electronic Records under its control and custody in a manner
consistent with past practice.
SECTION 4.3. Tax Returns. The Seller shall cause to be prepared and
timely filed, at its sole expense, all of its required tax returns for all
periods up to and including the Effective Date. The Seller shall be responsible
for the payment of, and will indemnify, defend and hold the Buyer harmless
against all taxes due or assessed which relate to the operations of the
Businesses for all periods up to and including the Effective Date. Buyer shall
have no rights to any refunds or deferred benefits available to Seller and
Stockholders attributable to tax returns filed for and applicable to any period
prior to the Effective Date.
SECTION 4.4. Investigations. Seller shall give Buyer and its
employees, accountants, attorneys and other authorized representatives full
access during all reasonable times to all the premises, properties, books and
records, and furnish Buyer with such financial and operating data, analyses and
other information of any kind respecting Seller's business and properties as
Buyer shall from time to time request. Any investigation shall be conducted in
a manner which does not unreasonably interfere with business operations. For a
period of two (2) years after Closing or, with regard to tax or environmental
claims, for the full period of the applicable statue of limitations, and until
any such action is finally resolved in full, Buyer shall give Seller or
Stockholders, or any of their authorized agents or representatives, full access
during reasonable times to all of the books and records of the Business that
are transferred to Buyer pursuant to this Agreement for preparation of tax
returns or in connection with the defense of any action against Seller or
Stockholders for events occurring prior to the Effective Date.
SECTION 4.5. Payment of Liabilities. Except for the Assumed
Liabilities, Seller shall pay and satisfy in full all of its other obligations
and liabilities, of any nature whatsoever, which accrue prior or subsequent to
the Effective Date.
SECTION 4.6. Employees and Consultants. Buyer and Seller have
determined in good faith that the closing of the transactions contemplated by
this Agreement will not result in an "employment loss" within the meaning of
the Workers Adjustment Retraining and Notification Act, 29 U.S.C. Section 2101
et seq. (the "Warn Act"). Seller will make all of its employees and consultants
relating to the Business available to be hired by the Buyer. Notwithstanding
the foregoing and except as otherwise set forth in this Agreement, the Buyer
shall be under no obligation to hire any such employees and consultants. Buyer
and Seller understand and acknowledge that each is an employer subject to the
Warn Act. The Seller shall be responsible for any Warn Act violations based on
or arising from acts, events or omissions prior to the termination of the
Employee Leasing Agreement, and the Buyer shall be responsible for any Warn Act
violations based on or arising from acts, events or omissions after the
termination of the Employee Leasing Agreement. At the termination of the
Employee Leasing Agreement, Seller shall provide to the Buyer a list of all
employees or former employees terminated by Seller during the one hundred
eighty (180) days prior to the termination of the Employee Leasing Agreement.
Buyer represents and warrants that during the first ninety (90) days after the
Closing it will not terminate any employee or employees whose termination
would, in the aggregate with terminations by the Seller during the ninety (90)
day period prior to the Closing, result in a violation of the Warn Act. Buyer
will indemnify and hold harmless Seller and Stockholders from any and all
claims brought under the Warn Act relating to any termination(s) of employee(s)
by Buyer, including course of defense of any
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such claims. Nothing herein shall be deemed either to affect or to limit in any
way the management prerogatives of Buyer with respect to employees, or to
create or to grant to such employees any third party beneficiary rights or
claims or causes of action of any kind or nature.
SECTION 4.7. Obligations Concerning Employees. Except for expenses
incurred in the ordinary course of business and properly accrued but unpaid,
the Seller will be responsible for all liabilities associated with the
employees which relate to the period prior to the termination of the Employee
Leasing Agreement (the "Employee Transfer Date"). Buyer will be responsible for
all liabilities associated with the Employees which relate to the period
subsequent to the termination of the Employee Leasing Agreement. After the
termination of the Employee Leasing Agreement, Buyer will notify the relevant
parties that Buyer will be responsible for expenses associated with benefit
plans for the Employees. Upon the termination of the Employee Leasing
Agreement, the Seller agrees to provide Buyer with a true and complete list of
the FICA wages and FICA withholdings related to compensation paid by the Seller
to the Employees prior to the termination of the Employee Leasing Agreement.
Buyer covenants and agrees that it will not, for the twelve (12) months
immediately following the Closing Date, reduce the current compensation of any
branch manager, recruiter, marketer, or the Vice President of Finance.
SECTION 4.8. Bulk Transfer Compliance. Buyer hereby waives
compliance by the Seller with the provisions of Article 6 of the Uniform
Commercial Code as in effect in the State of Missouri (the "Bulk Sales
Statutes"). The Stockholders shall indemnify, defend and hold Buyer harmless
from and against any loss, liability, cost, expense or damage resulting from
the assertion of a claim made against the Transferred Assets or Buyer by any
creditor of the Seller pursuant to the Bulk Sales Statutes, or any other
applicable law related to bulk sales.
SECTION 4.9. Non-Competition Covenant. As an additional inducement
for Buyer to enter into this Agreement, the parties hereby agree to the
provisions of this Section 4.9. During the Noncompetition Period (as defined
below), neither Seller nor Stockholders shall, (i) within the territorial
boundaries of the continental United States, where the Business of Seller is
now conducted, compete directly or indirectly with the Buyer's business; (ii)
solicit directly or indirectly any of the Accounts (as hereinafter defined) of
Seller or of Buyer or its affiliates or services similar to those of/and in the
Buyer's business; (iii) be employed by or otherwise render services to, or own
any interest in, any Person that directly or indirectly (a) competes with the
Buyer's business or its affiliates within the States of the United States in
which the Business is currently conducted, or (b) solicits directly or
indirectly any of the Accounts included in the Transferred Assets or of Buyer
or its affiliates; (iv) solicit directly or indirectly for employment by Seller
or Stockholders any of the employees of the Business; or (v) take any action or
fail to take any action which is likely to adversely affect Buyer's
relationship with, or purposefully interfere with the business relationship of
or solicit the business or orders of: (x) any customer of Buyer, or (y) a
prospective or potential customer of Buyer. For purposes of this Section 4.9,
the term "Accounts" shall mean any Person located in the United States of
America for which Seller has performed services with respect to the Business or
Buyer or its affiliates does perform services in the Buyer's business during
the period beginning three (3) years prior to the date hereof and ending on the
third anniversary of the Closing Date. Each of Seller and Stockholders agrees
that the limitations set forth herein on the rights of Seller and its
affiliates to compete with buyer and its affiliates are reasonable and
necessary for the protection of the Buyer. In this regard, Seller and
Stockholders specifically agree that
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the limitations as to period of time and geographic area, as well as all other
restrictions on its activities specified herein, are reasonable and necessary
for the protection of the Buyer. Seller and Stockholders further recognize and
agree that violation of any of the agreements contained in this Section 4.9
will cause irreparable damage or injury to Buyer, the exact amount of which may
be impossible to ascertain, and that, for such reason, among others, Buyer and
its affiliates shall be entitled to an injunction, without the necessity of
posting a bond, restraining any further violation of such agreements. Such
rights to any injunction shall be in addition to, and not in limitation of, any
other rights and remedies Buyer and its affiliates may have against Seller or
Stockholders and their affiliates, including, but not limited to, the recovery
of damages. Further, it is agreed by Seller and Stockholders that in the event
the provisions of this Agreement should ever be deemed to exceed the time or
geographic limitations permitted by applicable law, then such provisions shall
be reformed to the maximum time or geographic limitations permitted.
For purposes of this Section 4.9, the term Noncompetition Period shall
mean (i) with respect to Xxxx Xxxxxxxxxx, the period commencing on the date
hereof through the third anniversary of the Closing Date, and (ii) with respect
to Xxxx Xxxxxxx, the period commencing on the date hereof through the second
anniversary of the closing Date.
SECTION 4.10. Nondisclosure of Confidential Information. Seller and
Stockholders each recognize and acknowledge that they have and will have access
to certain confidential information of Seller that is included in the
Transferred Assets (including, but not limited to, list of customers, and costs
and financial information) that after the consummation of the transactions
contemplated hereby will be valuable, special and unique property of Buyer.
Seller and Stockholders each agree that they will not disclose, and they will
use their best efforts to prevent disclosure by any other Person of, any such
confidential information to any Person, except to authorized representatives of
Buyer. Seller and Stockholders recognize and agree that violation of any of
the agreements contained in this Section 4.10 will cause irreparable damage or
injury to Buyer, the exact amount of which may be impossible to ascertain, and
that, for such reason, among others, Buyer shall be entitled to an injunction,
without the necessity of posting bond, therefor, restraining any further
violation of such agreements. Such rights to any injunction shall be in
addition to, and not in limitation of, any other rights and remedies Buyer may
have against Seller or Stockholders.
SECTION 4.11. Corporate Names. Within fifteen (15) days of Closing
the Stockholders shall cause the name of Seller to be changed such that the new
name of Seller is not similar to the existing name and has been approved by the
Secretary of State of Missouri.
SECTION 4.12. Non-Competition Agreements. Seller shall use its best
efforts to cause each employee of Seller, for which there is no existing and
assignable non-competition agreement with Seller, to execute a non-competition
agreement with Buyer within thirty (30) days of Closing.
SECTION 4.13. Certain Expenses of Seller. The parties hereto agree
that the annual expenditures for marketing and employee functions of the
Business, as operated by Seller and Stockholders after Closing, shall not
exceed $100,000 in the aggregate in the first twelve (12) months following
Closing.
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SECTION 4.14. Employee Stock Options. Within thirty (30) days of
Closing, StaffMark shall grant employees of the Corporation, other than the
Stockholders, options to purchase an aggregate of 15,000 shares of StaffMark
Common Stock, par value $.01 per share, in an amount to each employee to be
determined by mutual agreement of the parties hereto. Such options shall be
granted pursuant to and subject to the terms of StaffMark's 1996 Stock Option
Plan.
ARTICLE V. CONDITIONS TO THE BUYER'S OBLIGATIONS
The obligation of the Buyer to make deliveries to the Seller pursuant
to Section 1.2 and 1.3 hereof and to consummate the other transactions
contemplated hereby is subject to the satisfaction, on or before the Closing
Date, of the following conditions each of which may be waived by the Buyer in
its sole discretion:
SECTION 5.1. Representations and Warranties True. All of the
representations and warranties made by Seller in Article II of this Agreement
shall be true in all material respects on and as of the Closing Date as though
such representations and warranties were made on and as of the Closing Date,
except to the extent such representations and warranties are expressly made as
of an earlier specified date; the Seller shall have in all material respects
performed and complied with all covenants and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing
Date; and Buyer shall have been furnished certificates of the President of the
Seller, dated the Closing Date, in his corporate capacity, certifying to the
truth in all material respects of such representations and warranties as of the
Closing Date and to the fulfillment in all material respects of such covenants
and conditions.
SECTION 5.2. Consents; Permits. All requisite governmental
approvals and consents of third parties required to be received to prevent any
material license, permit or agreement relating to the Business from terminating
prior to its scheduled termination, as a result of the consummation of the
transactions contemplated hereby, shall have been obtained and all permits
listed in Schedule 2.15 shall have been transferred or reissued to the Buyer.
SECTION 5.3. No Obstructive Proceeding. No suit, action or other
proceeding shall have been instituted to restrain, enjoin or otherwise prevent
or question the legality of the consummation of the transactions contemplated
by this Agreement.
SECTION 5.4. Opinion of Counsel to the Seller. The Buyer shall have
received an opinion from counsel to Seller, dated as of the Closing Date, in
form and substance reasonably satisfactory to Buyer.
SECTION 5.5. Closing Documents. The Seller shall have delivered all
of the Schedules, resolutions, certificates, documents and instruments required
by this Agreement.
SECTION 5.6. Approval of the Buyer and Its Counsel. All actions,
proceedings, consents, instruments and documents required to be delivered by,
or at the direction of, the Seller hereunder or incident to its performance
hereunder, and all other related matters, shall be reasonably satisfactory as
to form and substance to the Buyer and its counsel.
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SECTION 5.7. Employment Agreements. The Buyer shall have received
executed non-competition/employment agreements with Xxxx Xxxxxxxxxx and Xxxx
Xxxxxxx in form and content acceptable to Buyer and Xxxx Xxxxxxxxxx and Xxxx
Xxxxxxx (the "Employment Agreements").
SECTION 5.8. Adverse Change. There shall have been no material
adverse change in the Transferred Assets or condition (financial or otherwise)
of the Seller from the date of this Agreement through the Closing Date.
SECTION 5.9. Escrow Agreement. The Seller shall have delivered an
executed Escrow Agreement.
SECTION 5.10. Employee Leasing Agreement. The Seller shall have
executed and delivered the Employee Leasing Agreement.
SECTION 5.11. Additional Agreements. Buyer and affiliates shall have
entered into such additional agreements as may reasonably be required to be
entered into by such parties on or before the Closing.
ARTICLE VI. CONDITIONS TO THE SELLER'S OBLIGATIONS
The obligation of the Seller to transfer the Transferred Assets to
Buyer and to consummate the other transactions contemplated hereby is subject
to the satisfaction, on or before the Closing Date, of the following
conditions, each of which may be waived by the Seller in its sole discretion:
SECTION 6.1. Representations and Warranties True. All of the
representations and warranties made by Buyer in Article III of this Agreement
shall be true in all material respects on and as of the Closing Date as though
such representations and warranties were made on and as of the Closing Date,
except to the extent such representations and warranties are expressly made as
of an earlier specified date; the Buyer shall have in all material respects
performed and complied with all covenants and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing
Date; and the Seller shall have been furnished certificates of the President or
the Chief Financial Officer of the Buyer, dated the Closing Date, in his
corporate capacity, certifying to the truth in all material respects of such
representations and warranties as of the Closing Date and to the fulfillment in
all material respects of such covenants and conditions.
SECTION 6.2. Closing Documents. The Buyer shall have delivered all
of the Schedules, resolutions, certificates, documents and instruments required
by this Agreement.
SECTION 6.3. No Obstructive Proceeding. No suit, action or other
proceeding shall have been instituted to restrain, enjoin or otherwise prevent
or question the legality of the consummation of the transactions contemplated
by this Agreement.
SECTION 6.4. Approval of the Seller and Its Counsel. All actions,
proceedings, consents, instruments and documents required to be delivered by,
or at the direction of, the Buyer
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hereunder or incident to its performance hereunder, and all other related
matters, shall be reasonably satisfactory as to form and substance to the
Seller and its counsel.
SECTION 6.5. Escrow Agreement. The Buyer shall have delivered an
executed Escrow Agreement.
SECTION 6.6. Employment Agreements. The Buyer shall have executed
and delivered the Employment Agreements.
SECTION 6.7. Employee Leasing Agreement. The Buyer shall have
executed and delivered the Employee Leasing Agreement.
SECTION 6.8. Opinion of Counsel to Buyer. The Seller shall have
received an opinion of counsel to Buyer, dated as of the Closing Date, in form
and substance reasonably satisfactory to Seller.
SECTION 6.9. Additional Agreements. Buyer and affiliates shall have
entered into such additional agreements as may reasonably be required to be
entered into by such parties on or before the Closing.
ARTICLE VII. THE CLOSING AND CERTAIN CLOSING DELIVERIES
SECTION 7.1. Time and Place of Closing. Upon the terms and subject
to the satisfaction or waiver of the conditions contained in this Agreement,
the closing of the transactions contemplated by this Agreement (the "Closing")
shall take place at the offices of Behr, Mantovani, XxXxxxxx & Potter, P.C., on
April 24, 1997, or at such other place, date and time as may be mutually agreed
upon by the parties (the "Closing Date") via facsimile signatures of the
parties hereto, with original signatures of the parties to be exchanged within
five (5) business days of Closing. The transactions contemplated by this
Agreement shall be effective for accounting purposes as of 12:01 A.M. (CST)
(the "Effective Time") on April 1, 1997, (the "Effective Date").
SECTION 7.2. Deliveries by the Seller.
(1) At the Closing, the Seller will deliver or cause to be
delivered to the Buyer the following:
(a) All required consents of third parties to the sale
conveyance, transfer, assignment and delivery of the Transferred Assets and the
Business of Seller hereunder;
(b) A certificate of the Secretary of Seller certifying as
of the Closing Date, (i) a true, correct, and complete copy of the Articles of
Incorporation of Seller and all amendments thereto as in effect on the Closing
Date; (ii) a true, correct, and complete copy of the Bylaws of Seller and all
amendments thereto as in effect on the Closing Date; (iii) a true, correct, and
complete copy of the resolutions approved and adopted by Seller's Stockholders
authorizing and approving the execution, performance and delivery of this
Agreement and the transactions contemplated by this Agreement; and (iv) Good
Standing Certificate from the Missouri Secretary of State;
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(c) The affidavit of the Seller certifying as to its
non-foreign status in accordance with Section 1445(6)(2) of the Code.
(d) The opinion of Seller's counsel required by Section
5.4 above;
(e) Executed Employment Agreements;
(f) All Schedules required by this Agreement;
(g) Executed Escrow Agreement;
(h) Executed Employee Leasing Agreement; and
(i) All other documents, instruments and writings required
to be delivered by the Seller at or prior to the Closing Date pursuant to this
Agreement or otherwise required in connection herewith.
SECTION 7.3. Deliveries by the Buyer.
(1) At the Closing, the Buyer will deliver the following to or for
the account of Seller or certain of its employees, as the case may be:
(a) The Purchase Price as required by Section 1.2 above,
and an executed copy of the Escrow Agreement;
(b) Verification of funding of the Escrow;
(c) A certificate of an executive officer of Buyer
certifying as of the Closing Date (i) a true, correct, and complete copy of the
Articles of Incorporation of the Buyer and all amendments thereto as in effect
on the Closing Date; (ii) a true, correct, and complete copy of the bylaws of
the Buyer and all amendments thereto as in effect on the Closing Date; (iii) a
true, correct, and complete copy of the resolutions approved and adopted by the
Board of Directors of the Buyer authorizing the transactions contemplated
herein; (iv) Good Standing Certificate from the Delaware Secretary of State;
(d) Executed Employment Agreements;
(e) Executed Employee Leasing Agreement; and
(f) All other documents, instruments and writings required
to be delivered by the Buyer at or prior to the Closing Date pursuant to this
Agreement or otherwise required in connection herewith.
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ARTICLE VIII. INDEMNIFICATION
SECTION 8.1. Survival. All representations and warranties in this
Agreement and the Documents shall survive the Closing and any investigation at
any time made by or on behalf of any party for a period of two years and all
such representations and warranties shall expire on the second anniversary of
the Closing Date, except that (a) claims, if any, asserted in writing prior to
such second anniversary identified as a claim for indemnification pursuant to
this Article VIII shall survive until finally resolved and satisfied in full,
and (b) tax or environmental claims arising from a breach of Sections 2.24 and
2.26, respectively, shall survive for the full period of the applicable statute
of limitations, and until finally resolved and satisfied in full if asserted on
or prior to the expiration of any such period. The representations and
warranties shall not be affected or otherwise diminished by any investigation
at any time representations and warranties were made.
SECTION 8.2. Indemnification by Seller. Subject to the terms
herein, the Seller and Stockholders, jointly and severally, shall indemnify,
defend, and hold the Buyer and its officer, directors, and employees, and their
respective successors and assigns (the "Seller's Indemnitees") harmless from,
against and with respect to any claim, liability, obligation, loss, damage,
assessment, judgment, cost and expense of any kind or character, including
reasonable attorney's and paralegal fees (the "Damages"), arising out of or in
any manner incident, relating or attributable to (provided that this Section
8.1 shall not apply to any items that have been expressly assumed by Buyer
under this Agreement):
(a) any liability or claim for liability (whether in
contract, in tort or otherwise, and whether or not
successful) of or against Buyer related in any way to
the Business or Transferred Assets of any of them
(including any liability of Seller or Stockholders
under all ERISA laws);
(b) any liability or claim for liability (whether in
contract, in tort or otherwise, and whether or not
successful) related in any way to the Transferred
Assets or the Business to the extent such liability
arises in connection with any action, omission or
event occurring on or prior to the Closing Date;
(c) any liability or claim for liability (whether in
contract, in tort or otherwise, and whether or not
successful) related to any liens, obligations or
encumbrances of any nature whatsoever against or in
any way related to the Transferred Assets or the
Business which have not been expressly assumed by the
Buyer under Section 1.3;
(d) any liability or claim for liability (whether in
contract, in tort or otherwise, and whether or not
successful) related to the Taxes of Seller or
Stockholders;
(e) any liability or claim for liability (whether or not
successful) related to any lawsuit or threatened
lawsuit or claim involving the Seller or Stockholders;
(f) Any inaccuracy in any representation or breach of any
warranty of Seller or Stockholders contained in this
Agreement;
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(g) Any failure by Seller or Stockholders to perform or
observe, or to have performed or observed, in full,
any covenant, agreement or condition to be performed
or observed by it under any of the Documents; or
(h) Reliance by the Buyer on any books or records of the
Seller or on any written information furnished to the
Buyer pursuant to this Agreement by or on behalf of
the Seller in the event that such books and records or
written information are false or inaccurate.
SECTION 8.3. Limitation of Certain Liability. To the extent the
Seller's Indemnitees incur or suffer Damages for any matter for which Seller
and Stockholders are obligated to indemnify, hold harmless and defend Buyer
under Section 8.2(a), (b), (f), (g) or (h) above, Seller and Stockholders shall
not be liable for any such Damages (i) until Buyer has suffered aggregate
losses by reason of all such misrepresentations, breaches of warranty and/or
any non- fulfillments of covenants or agreements on the part of Seller and/or
Stockholders in excess of a $50,000 threshold (at which point Seller and
Stockholders will be obligated to indemnify Buyer from and against all such
aggregate losses including losses back to the first dollar), provided, however,
that the limitations set forth above specifically shall not apply to Damages
(y) resulting from or attributable to intentional fraud or any willful
misconduct by Seller and Stockholders, or (z) for any matter or matters (other
than those set out in Section 8.2(a), (b), (f), (g) or (h) above), for which
Seller or Stockholders is obligated to indemnify, hold harmless and defend
Buyer.
SECTION 8.4. Notice to Seller, Etc. If any of the matters as to
which the Seller's Indemnitees are entitled to receive indemnification under
Section 8.2 should entail litigation with or claims asserted by parties other
than the Seller, the Seller shall be given prompt notice thereof and shall have
the right, at its expense, to control such claim or litigation upon prompt
notice to Buyer of its election to do so. To the extent requested by the
Seller, the Buyer, at its expense, shall cooperate with and assist the Seller,
in connection with such claim or litigation. Buyer, at its expense, shall have
the right to appoint single counsel to consult with and remain advised by the
Seller in connection with such claim or litigation. The Seller shall have final
authority to determine all matters in connection with such claim or litigation;
provided, however, that the Seller shall not settle any third party claim
without the consent of the Buyer, which shall not be unreasonably denied or
delayed.
SECTION 8.5. Indemnification by Buyer. The Buyer shall indemnify,
defend, and hold the Seller and its Stockholders and officers and employees and
their respective successors and assigns (the "Buyer's Indemnitees") harmless
from, against and with respect to any claim, liability, obligation, loss,
damage, assessment, judgment, cost and expense of any kind or character,
including reasonable attorney's and paralegal fees (the "Damages"), exceeding
in the aggregate $25,000 (at which point Buyer will be obligated to indemnify
Seller from and against all such aggregate losses including losses back to the
first dollar) and arising out of or in any manner incident, relating or
attributable to:
(a) Any inaccuracy in any representation or breach of
warranty of the Buyer contained in this Agreement;
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(b) Any failure by the Buyer to perform or observe, or to
have performed or observed, in full, any covenant,
agreement or condition to be performed or observed by
it under any of the Documents;
(c) Reliance by the Seller on any books or records of the
Buyer or reliance by the Seller on any written
information furnished to the Seller pursuant to this
Agreement by or on behalf of the Buyer in the event
that such books and records or written information are
false or inaccurate; or
(d) The failure of Buyer to pay or perform the Assumed
Liabilities, Contracts and Leases subsequent to the
Closing Date; or
SECTION 8.6. Notice to the Buyer, Etc. If any of the matters as to
which the Buyer's Indemnitees are entitled to receive indemnification under
Section 8.5 should entail litigation with or claims asserted by parties other
than the Buyer, the Buyer shall be given prompt notice thereof and shall have
the right, at its expense, to control such claim or litigation upon prompt
notice to Seller of its election to do so. To the extent requested by the
Buyer, the Seller, at its expense shall cooperate with and assist the Buyer, in
connection with such claim or litigation. Seller, at its expense, shall have
the right to appoint single counsel to consult with and remain advised by the
Buyer in connection with such claim or litigation. The Buyer shall have final
authority to determine all matters in connection with such claim or litigation;
provided, however, that the Buyer shall not settle any third party claim
without the consent of the Seller, which shall not be unreasonably denied or
delayed.
SECTION 8.7. Right of Set-Off. Upon notice to Seller specifying in
reasonable detail the basis for such set- off, Buyer may give notice of a Claim
under the Escrow Agreement for amounts to which it may be entitled under this
Article VIII. The exercise of such right of set-off by Buyer in good faith,
whether or not ultimately determined to be justified, will not constitute an
event of default under the Escrow Agreement. Neither the exercise of nor
failure to exercise such right of set-off or to give a notice of a Claim under
the Escrow Agreement will constitute an election of remedies or limit Buyer in
any manner in the enforcement of any other remedies that may be available to
it.
SECTION 8.8. Survival of Indemnification. The obligations to
indemnify and hold harmless pursuant to this Article VIII shall survive the
Closing of the purchase of the Business contemplated hereby for a period of two
years, notwithstanding any investigation at any time made by or on behalf of
any party, except that (a) claims, if any, asserted in writing prior to such
second anniversary identified as a claim for indemnification pursuant to this
Article VIII shall survive until finally resolved and satisfied in full, and
(b) tax or environmental claims arising from a breach of Sections 2.24 and
2.26, respectively, shall survive for the full period of the applicable statute
of limitations, and until finally resolved and satisfied in full if asserted on
or prior to the expiration of any such period.
ARTICLE IX. MISCELLANEOUS
SECTION 9.1. Knowledge of Seller. Where any representation or
warranty contained in this Agreement is expressly qualified by reference to the
best knowledge of Seller, Seller confirms that
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it has made due and diligent inquiry of its directors, officers, and
Stockholders as to the matters that are the subject of such representations and
warranties.
SECTION 9.2. Knowledge of Buyer. Where any representation or
warranty contained in this Agreement is expressly qualified by reference to the
best of knowledge of Buyer, Buyer confirms that it has made due and diligent
inquiry of its President, Vice Presidents and Chief Financial Officer as to the
matters that are the subject of such representations and warranties.
SECTION 9.3. "Person" Defined. "Person" shall mean and include an
individual, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or other department or agency
thereof.
SECTION 9.4. Notices. All notices, requests, consents and other
communications hereunder shall be in writing, shall be addressed to the
receiving party's address set forth below or to such other address as a party
may designate by notice hereunder, and shall be either (i) delivered by hand,
(ii) sent by recognized overnight courier, (iii) made by telecopy or facsimile
transmission, or (iv) sent by registered or certified mail, return receipt
requested, postage prepaid.
If to the Buyer:
StaffMark, Inc.
000 Xxxx Xxxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx, Chief Financial Officer
Fax No.: (000) 000-0000
With a copy to:
Xxxxxx, Xxxxxxx & Xxxxxxxx
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx III, Esq.
Fax No.: (000) 000-0000
If to Seller:
Xxxx Xxxxxxxxxx
00000 Xxxxxx Xxxxx
Xxxx & Xxxxxxx, Xxxxxxxx 00000
With a copy to:
BEHR, MANTOVANI, XxXXXXXX & XXXXXX, P.C.
0000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxxx
Fax No. (000) 000-0000
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All notices, requests, consents and other communications hereunder shall be
deemed to have been given (i) if by hand, at the time of the delivery thereof
to the receiving party at the address of such party set forth above, (ii) if
sent by overnight courier, on the next business day following the day such
notice is delivered to the courier service, (iii) if made by telecopy or
facsimile transmission, at the time that receipt thereof has been acknowledged
by electronic confirmation or otherwise, or (iv) if sent by registered or
certified mail, on the fifth business day following the day such mailing is
sent. The address of any party herein may be changed at any time by written
notice to the other party given in accordance with this Section 9.4.
SECTION 9.5. Entire Agreement. This Agreement and the other
Documents embody the entire agreement and understanding between the parties
hereto with respect to the subject matter hereof and supersede all prior oral
or written agreements and understandings relating to the subject matter hereof.
No statement, representation, warranty, covenant or agreement of any kind not
expressly set forth in the other Documents shall affect or be used to
interpret, change or restrict, the express terms and provisions of this
Agreement.
SECTION 9.6. Modifications and Amendments. The terms and provisions
of this Agreement may be modified or amended only by written agreement executed
by all parties hereto.
SECTION 9.7. Assignment/Binding Effect. Neither this Agreement, nor
any right hereunder, may be assigned by any of the parties hereto without the
prior written consent of the other parties, which consent shall not be
unreasonably withheld; provided, however, Buyer may assign its rights (but not
its obligations) hereunder to a wholly- owned subsidiary formed for the purpose
of owning and operating the Business. This Agreement shall be binding upon, and
inure to the benefit of, the representatives, successors and permitted assigns.
SECTION 9.8. Parties in Interest. Nothing in this Agreement,
express or implied, is intended to confer upon any other person any rights or
remedies of any nature whatsoever under or by reason of this Agreement. Nothing
in this Agreement shall be construed to create any rights or obligations except
among the parties hereto, and no person or entity shall be regarded as a
third-party beneficiary of this Agreement.
SECTION 9.9. Governing Law. This Agreement and the rights and
obligations of the parties hereunder shall be construed in accordance with and
governed by the internal laws of the State of Arkansas, without regard to
conflict of laws provisions, except as otherwise expressly provided in this
Agreement or in an Annex or Schedule hereto.
SECTION 9.10. Severability. In the event that any court of competent
jurisdiction shall finally determine that any provision, or any portion
thereof, contained in this Agreement shall be void or unenforceable in any
respect, then such provision shall be deemed limited to the extent that such
arbitral tribunal determines it enforceable, and as so limited shall remain in
full force and effect. In the event that such arbitral tribunal shall determine
any such provision, or portion thereof, wholly unenforceable, the remaining
provisions of this Agreement shall nevertheless remain in full force and
effect.
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SECTION 9.11. Interpretation. The parties hereto acknowledge and
agree that: (i) the rule of construction to the effect that any ambiguities are
resolved against the drafting party shall not be employed in the interpretation
of this Agreement, and (ii) the terms and provisions of this Agreement shall be
construed fairly as to all parties hereto and not in favor of or against any
party, regardless of which party was generally responsible for the preparation
of this Agreement.
SECTION 9.12. Headings and Captions. The headings and captions of
the various subdivisions of this Agreement are for convenience of reference
only and shall in no way modify, or affect, or be considered in construing or
interpreting the meaning or construction of any of the terms or provisions
hereof.
SECTION 9.13. Reliance. The parties hereto agree that,
notwithstanding any right of any party to this Agreement to investigate the
affairs of any other party to this Agreement, the party having such right to
investigate shall have the right to rely fully upon the representations and
warranties of the other party expressly contained herein, unless such party has
actual knowledge otherwise, which shall be proved by the other party by clear
and convincing evidence.
SECTION 9.14. Expenses. Each party shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or
others engaged by such party) incurred in connection with this Agreement and
the transactions contemplated hereby whether or not the transactions
contemplated hereby are consummated.
SECTION 9.15. Gender. All pronouns and any variation thereof shall
be deemed to refer to the masculine, feminine, neuter, singular, or plural as
the identity of the person or entity or the context may require.
SECTION 9.16. Publicity. Except by the mutual agreement between the
Seller and Buyer, no party shall issue any press release or otherwise make any
public statement with respect to the execution of, or the transactions
contemplated by, this Agreement except as may be required by law.
SECTION 9.17. Counterparts. This Agreement may be executed in one or
more counterparts, and by different parties hereto on separate counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
SECTION 9.18. Telecopy Execution and Delivery. A facsimile telecopy
or other reproduction of this Agreement may be executed by one or more parties
hereto, and an executed copy of this Agreement may be delivered by one or more
parties hereto by facsimile or similar instantaneous electronic transmission
device pursuant to which the signature of or on behalf of such party can be
seen, and such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all parties
hereto agree to execute an original of this Agreement as well as any facsimile,
telecopy or other reproduction thereof.
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IN WITNESS WHEREOF, the Buyer, Seller and Stockholders have each caused
this Agreement to be executed to be executed by their respective duly
authorized officers all as of the day and year first above written.
"BUYER"
STAFFMARK ACQUISITION CORPORATION FIVE
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, President
STAFFMARK, INC.
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, President
"SELLER"
XXXXXXXXXX & ASSOCIATES, INC.
By: /s/ Xxxx Xxxxxxxxxx
----------------------------------
Xxxx Xxxxxxxxxx, President
"STOCKHOLDERS"
/s/ Xxxx Xxxxxxxxxx
-------------------------------------
Xxxx Xxxxxxxxxx, Trustee
/s/ Xxxx Xxxxxxx
-------------------------------------
Xxxx Xxxxxxx, Individually
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