AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ICCE, INC.,
THE SHAREHOLDERS OF ICCE, INC.,
ASRI MERGER SUBSIDIARY, INC.,
ACSYS RESOURCES, INC.
AND
THE SHAREHOLDERS OF ACSYS RESOURCES, INC.
DATED AS OF SEPTEMBER 3, 1997
TABLE OF CONTENTS
Page
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PARTIES................................................................... 1
PREAMBLE.................................................................. 1
ARTICLE 1 - TRANSACTIONS AND TERMS OF MERGER.............................. 1
1.1 Merger..................................................... 1
1.2 Time and Place of Closing.................................. 2
1.3 Effective Time............................................. 2
ARTICLE 2 - TERMS OF MERGER............................................... 2
2.1 Charter.................................................... 2
2.2 Bylaws..................................................... 2
2.3 Directors and Officers..................................... 2
2.4 Board of Directors of ICCE................................. 2
ARTICLE 3 - MANNER OF CONVERTING SHARES................................... 2
3.1 Conversion of Shares....................................... 2
3.2 Anti-Dilution Provisions................................... 3
3.3 Shares Held by ACSYS or ICCE............................... 3
3.4 Exchange of Shares......................................... 3
3.5 Rights of Former ACSYS Shareholders........................ 4
3.6 Legending of Securities; Pooling Restrictions.............. 4
3.7 Conversion of Stock Options................................ 5
3.8 Escrow Arrangements........................................ 6
3.9 Escrow Agreement........................................... 7
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF ACSYS AND THE
ACSYS SHAREHOLDERS................................................... 7
4.1 Organization, Standing, and Power.......................... 7
4.2 Authority of ACSYS; No Breach By Agreement................. 7
4.3 Authority of ACSYS Shareholders; No Breach By
Agreement.................................................. 8
4.4 Capital Stock.............................................. 9
4.5 Financial Statements....................................... 9
4.6 Absence of Undisclosed Liabilities......................... 10
4.7 Absence of Certain Changes or Events....................... 10
4.8 Tax Matters................................................ 11
4.9 Assets..................................................... 12
4.10 Intellectual Property...................................... 13
4.11 Environmental Matters...................................... 13
4.12 Compliance with Laws....................................... 14
4.13 Labor and Employment Matters............................... 15
4.14 Employee Benefit Plans..................................... 15
4.15 Material Contracts......................................... 17
4.16 Legal Proceedings.......................................... 17
4.17 Reports.................................................... 18
4.18 Statements True and Correct................................ 18
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4.19 Accounting, Tax and Regulatory Matters...................... 18
4.20 Investment Intention........................................ 18
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF ICCE AND THE ICCE
SHAREHOLDERS.......................................................... 19
5.1 Organization, Standing, and Power........................... 19
5.2 Authority; No Breach By Agreement........................... 19
5.3 Capital Stock............................................... 20
5.4 Financial Statements........................................ 20
5.5 Absence of Undisclosed Liabilities.......................... 21
5.6 Absence of Certain Changes or Events........................ 21
5.7 Tax Matters................................................. 22
5.8 Assets...................................................... 23
5.9 Intellectual Property....................................... 24
5.10 Environmental Matters....................................... 24
5.11 Compliance With Laws........................................ 25
5.12 Legal Proceedings........................................... 25
5.13 Labor and Employment Matters................................ 26
5.14 Employee Benefit Plans...................................... 26
5.15 Statements True and Correct................................. 28
5.16 Authority of Sub............................................ 28
5.17 Accounting, Tax and Regulatory Matters...................... 28
5.18 Material Contracts.......................................... 28
5.19 Reports..................................................... 29
5.20 Authority of ICCE Shareholders; No Breach By
Agreement................................................... 29
ARTICLE 6 - CERTAIN AGREEMENTS............................................. 30
6.1 Filings with State Offices.................................. 30
6.2 Certain Tax Returns of ACSYS................................ 30
6.3 ACSYS Shareholder Releases.................................. 31
6.4 Accounting and Tax Treatment................................ 31
ARTICLE 7 - CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE.............. 31
7.1 Conditions to Obligations of Each Party..................... 31
7.2 Conditions to Obligations of ICCE........................... 32
7.3 Conditions to Obligations of ACSYS and the
ACSYS Shareholders.......................................... 33
ARTICLE 8 - INDEMNIFICATION................................................ 34
8.1 Agreement of Indemnitors to Indemnify....................... 34
8.2 Procedures for Indemnification.............................. 36
8.3 Third Party Claims.......................................... 36
8.4 Indemnification Exclusive Remedy............................ 38
8.5 Survival.................................................... 38
8.6 Time Limitations............................................ 38
8.7 Limitations as to Amount.................................... 38
8.8 Tax Effect and Insurance.................................... 39
8.9 Escrow Claim................................................ 39
8.10 Subrogation................................................. 39
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8.11 Appointment of Indemnitor Representatives................... 39
ARTICLE 9 - TERMINATION.................................................... 40
9.1 Termination................................................. 40
9.2 Effect of Termination....................................... 41
ARTICLE 10 - MISCELLANEOUS................................................. 41
10.1 Definitions................................................. 41
10.2 Expenses.................................................... 49
10.3 Brokers and Finders......................................... 49
10.4 Entire Agreement............................................ 50
10.5 Amendments.................................................. 50
10.6 Waivers..................................................... 50
10.7 Assignment.................................................. 51
10.8 Notices..................................................... 51
10.9 Governing Law............................................... 52
10.10 Counterparts................................................ 52
10.11 Captions; Articles and Sections............................. 52
10.12 Interpretations............................................. 52
10.13 Severability................................................ 52
SIGNATURES................................................................. 53
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AGREEMENT AND PLAN OF MERGER
----------------------------
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and
entered into as of September 3, 1997, by and among ICCE, INC. ("ICCE"), a
Georgia corporation; the shareholders of ICCE identified in Schedule I hereto
(the "ICCE Shareholders"); ASRI MERGER SUBSIDIARY, INC. ("Sub"), a Pennsylvania
corporation; ACSYS RESOURCES, INC. ("ACSYS"), a Pennsylvania corporation; and
the shareholders of ACSYS identified in Schedule II hereto (each an "ACSYS
Shareholder" and collectively the "ACSYS Shareholders").
PREAMBLE
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The ACSYS Shareholders, the ICCE Shareholders and the respective
Boards of Directors of ACSYS, Sub and ICCE are of the opinion that the
transactions described herein are in the best interests of the parties to this
Agreement and, in the case of ACSYS, Sub and ICCE, their respective
shareholders. This Agreement provides for the acquisition of ACSYS by ICCE
pursuant to the merger of Sub with and into ACSYS. At the effective time of
such merger, the outstanding shares of the capital stock of ACSYS shall be
converted into the right to receive shares of the common stock of ICCE (except
as provided herein). As a result, ACSYS Shareholders shall become shareholders
of ICCE and ACSYS shall continue to conduct its business and operations as a
wholly owned subsidiary of ICCE. The transactions described in this Agreement
are subject to the satisfaction of certain other conditions described in this
Agreement. It is the intention of the parties to this Agreement that the Merger
for federal income tax purposes shall qualify as a "reorganization" within the
meaning of Section 368(a) of the Internal Revenue Code, and for accounting
purposes shall qualify for treatment as a pooling of interests.
Certain terms used in this Agreement are defined in Section 10.1 of
this Agreement.
NOW, THEREFORE, in consideration of the above and the mutual
warranties, representations, covenants, and agreements set forth herein, the
parties agree as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
--------------------------------
1.1 MERGER. Subject to the terms and conditions of this Agreement,
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at the Effective Time, Sub shall be merged with and into ACSYS in accordance
with the provisions of Section 1921(a) of the PBCL and with the effect provided
in Section 1929 of the PBCL (the "Merger"). ACSYS shall be the Surviving
Corporation resulting from the Merger and shall become a wholly owned Subsidiary
of ICCE and shall continue to be governed by the Laws of the Commonwealth of
Pennsylvania. The Merger shall be consummated pursuant to the terms of this
Agreement, which has been approved and adopted by the respective Boards of
Directors of ACSYS, Sub and
ICCE, by ICCE, as the sole shareholder of Sub, and by the ACSYS Shareholders, as
the sole shareholders of ACSYS.
1.2 TIME AND PLACE OF CLOSING. The closing of the transactions
-------------------------
contemplated hereby (the "Closing") will take place at 12:00 P.M. on the date
that the Effective Time occurs, or at such other time as the Parties, acting
through their authorized officers, may mutually agree. The Closing shall be
held at such location as may be mutually agreed upon by the Parties.
1.3 EFFECTIVE TIME. The Merger and other transactions contemplated
--------------
by this Agreement shall become effective on the date and at the time the
Certificate of Merger reflecting the Merger shall become effective with the
Secretary of State of the Commonwealth of Pennsylvania (the "Effective Time").
ARTICLE 2
TERMS OF MERGER
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2.1 CHARTER. The Articles of Incorporation of ACSYS in effect
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immediately prior to the Effective Time shall be the Articles of Incorporation
of the Surviving Corporation until duly amended or repealed.
2.2 BYLAWS. The Bylaws of ACSYS in effect immediately prior to the
------
Effective Time shall be the Bylaws of the Surviving Corporation until duly
amended or repealed.
2.3 DIRECTORS AND OFFICERS. The directors of Sub in office
----------------------
immediately prior to the Effective Time, together with such additional persons
as may thereafter be elected, shall serve as the directors of the Surviving
Corporation from and after the Effective Time in accordance with the Bylaws of
the Surviving Corporation. The officers of Sub in office immediately prior to
the Effective Time, together with such additional persons as may thereafter be
elected, shall serve as the officers of the Surviving Corporation from and after
the Effective Time in accordance with the Bylaws of the Surviving Corporation.
2.4 BOARD OF DIRECTORS OF ICCE. Effective as of the Effective Time,
--------------------------
the Board of Directors of ICCE shall take all action necessary to remove or
obtain the resignations of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as directors of ICCE, to elect ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ to fill such vacancies, and to reduce the size of the Board
to seven.
ARTICLE 3
MANNER OF CONVERTING SHARES
---------------------------
3.1 CONVERSION OF SHARES. Subject to the provisions of this Article
--------------------
3, at the Effective Time, by virtue of the Merger and without any action on the
part of ICCE, ACSYS,
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Sub or the shareholders of any of the foregoing, the shares of the constituent
corporations shall be converted as follows:
(a) Each share of capital stock of ICCE issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding
from and after the Effective Time.
(b) Each share of Sub Common Stock issued and outstanding
immediately prior to the Effective Time shall cease to be outstanding and
shall be converted into one share of ACSYS Common Stock.
(c) Subject to Section 3.8, each share of ACSYS Common Stock
(excluding shares held by any ACSYS Entity or any ICCE Entity) issued and
outstanding immediately prior to the Effective Time shall cease to be
outstanding and shall be converted into and exchanged for the right to
receive a number of shares (the "Exchange Ratio") of ICCE Common Stock (the
"Merger Shares") equal to the quotient obtained by dividing 3,659,500 by the
number of shares of ACSYS Common Stock (excluding shares held by any ACSYS
Entity or any ICCE Entity) issued and outstanding immediately prior to the
Effective Time.
3.2 ANTI-DILUTION PROVISIONS. In the event ICCE changes the number
------------------------
of shares of ICCE Common Stock issued and outstanding prior to the Effective
Time as a result of a stock split, stock dividend, or similar recapitalization
with respect to such stock and the record date therefor (in the case of a stock
dividend) or the effective date thereof (in the case of a stock split or similar
recapitalization for which a record date is not established) shall be prior to
the Effective Time, the Exchange Ratio shall be proportionately adjusted.
3.3 SHARES HELD BY ACSYS OR ICCE. Each of the shares of ACSYS Common
----------------------------
Stock held by any ACSYS Entity or by any ICCE Entity shall be canceled and
retired at the Effective Time and no consideration shall be issued in exchange
therefor.
3.4 EXCHANGE OF SHARES. At the Closing, each ACSYS Shareholder shall
------------------
surrender each certificate or certificates which represented shares of ACSYS
Common Stock immediately prior to the Effective Time (the "Certificates") and
shall promptly upon surrender thereof receive in exchange therefor the number of
whole Merger Shares issuable in respect of all shares of ACSYS Common Stock held
by such ACSYS Shareholder (rounded up to the next nearest share). If any
Certificate shall have been lost, stolen, mislaid or destroyed, upon receipt of
(i) an affidavit of that fact from the holder claiming such Certificate to be
lost, mislaid, stolen or destroyed, (ii) such bond, security or indemnity as
ICCE may reasonably require and (iii) any other documents necessary to evidence
and effect the bona fide exchange thereof, ICCE shall issue to such holder the
consideration into which the shares represented by such lost, stolen, mislaid or
destroyed Certificate shall have been converted. ICCE shall not be obligated to
deliver the consideration to which any former holder of ACSYS Common Stock is
entitled as a result of the Merger until such holder surrenders such holder's
Certificate or Certificates for exchange as provided in this Section 3.4. Any
other provision of this Agreement notwithstanding, neither ICCE nor the
Surviving Corporation shall be liable to a holder of ACSYS Common
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Stock for any amounts paid or property delivered in good faith to a public
official pursuant to any applicable abandoned property, escheat or similar Law.
3.5 RIGHTS OF FORMER ACSYS SHAREHOLDERS. At the Effective Time, the
-----------------------------------
stock transfer books of ACSYS shall be closed as to holders of ACSYS Common
Stock immediately prior to the Effective Time and no transfer of ACSYS Common
Stock by any such holder shall thereafter be made or recognized. Until
surrendered for exchange in accordance with the provisions of Section 3.4, each
Certificate theretofore representing shares of ACSYS Common Stock (other than
shares to be canceled pursuant to Section 3.3) shall from and after the
Effective Time represent for all purposes only the right to receive the
consideration provided in Sections 3.1 in exchange therefor. Whenever a
dividend or other distribution is declared by ICCE on the ICCE Common Stock, the
record date for which is at or after the Effective Time, the declaration shall
include dividends or other distributions on all shares of ICCE Common Stock
issuable pursuant to this Agreement, but no dividend or other distribution
payable to the holders of record of ICCE Common Stock as of any time subsequent
to the Effective Time shall be delivered to the holder of any Certificate until
such holder surrenders such Certificate for exchange as provided in Section 3.4.
However, upon surrender of such Certificate, both the ICCE Common Stock
certificate (together with all such undelivered dividends or other distributions
without interest) and any undelivered dividends payable in respect thereof
(without interest) shall be delivered and paid with respect to each share
represented by such Certificate.
3.6 LEGENDING OF SECURITIES; POOLING RESTRICTIONS.
---------------------------------------------
(a) The shares of ICCE Common Stock to be issued in connection
with this Agreement will be issued in a transaction exempt from registration
under the 1933 Act by reason of Section 4(2) thereof or Regulation D promulgated
thereunder, and ICCE is relying on the representations of the ACSYS Shareholders
with respect to such exemption. Each ACSYS Shareholder understands and agrees
that stop transfer instructions with respect to the shares of ICCE Common Stock
received by each ACSYS Shareholder pursuant to the Merger will be given to
ICCE's transfer agent and that there will be placed on the certificates for such
shares, or shares issued in substitution thereof, a legend stating in substance:
"The securities represented hereby have not been registered under
the Securities Act of 1933, as amended, and may not be offered, sold,
transferred or otherwise disposed of unless registered with the Securities
and Exchange Commission of the United States and the securities regulatory
authorities of applicable states or unless an exemption from such
registration is available.
The securities represented by this certificate are subject to the
provisions of an Agreement and Plan of Merger, dated as of September 3, 1997,
and may not be sold or otherwise transferred, except in accordance therewith.
Copies of such agreement may be obtained at the principal executive offices
of ICCE, Inc."
(b) Each ACSYS Shareholder agrees that he will not sell,
transfer, or otherwise dispose of his interests in, or reduce his risk relative
to, any of the shares of ICCE
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Common Stock into which his shares of ACSYS Common Stock are converted upon
consummation of the Merger until such time as ICCE notifies the undersigned that
the requirements of SEC Accounting Series Release Nos. 130 and 135 ("ASR 130 and
135") have been met. Each ACSYS Shareholder understands and agrees that stop
transfer instructions with respect to the shares of ICCE Common Stock received
by each ACSYS Shareholder pursuant to the Merger will be given to ICCE's
transfer agent and that there will be placed on the certificates for such
shares, or shares issued in substitution thereof, a legend stating in substance:
"The shares represented by this certificate were issued
pursuant to a business combination which is accounted for as a
"pooling of interests" and may not be sold, nor may the owner
thereof reduce his risks relative thereto in any way, until such
time as ICCE, Inc. has published the financial results covering at
least 30 days of combined operations after the effective date of
the merger through which the business combination was effected."
In any decision by ICCE regarding the application of the limitations described
in such legend, the words "sell," "transfer," "otherwise dispose of" and "reduce
his risk" shall be construed and applied consistent with the criteria of ASR 130
and 135, Staff Accounting Bulletins 75 and 65 and interpretations thereof used
by the staff of the SEC.
(c) The foregoing legends will also be placed on any certificate
representing securities issued subsequent to the original issuance of the ICCE
Common Stock pursuant to the Merger as a result of any transfer of such shares
or any stock dividend, stock split, or other recapitalization as long as the
ICCE Common Stock issued to the undersigned pursuant to the Merger has not been
transferred in such manner to justify the removal of the legend therefrom. Upon
the request of a ACSYS Shareholder, ICCE shall cause the certificates
representing the shares of ICCE Common Stock issued to the undersigned in
connection with the Merger to be reissued free of any legend relating to
restrictions on transfer by virtue of ASR 130 and 135 as soon as practicable
after the requirements of ASR 130 and 135 have been met.
3.7 CONVERSION OF STOCK OPTIONS.
---------------------------
(a) At the Effective Time, each ACSYS Option which is outstanding
at the Effective Time, whether or not exercisable, shall be converted into and
become rights with respect to ICCE Common Stock, and ICCE shall assume each
ACSYS Option, in accordance with the terms of the ACSYS stock option plan and
stock option agreement by which it is evidenced (collectively, "ACSYS Stock
Plan"), except that from and after the Effective Time, (i) ICCE and its Stock
Option Committee shall be substituted for ACSYS and the Committee of ACSYS's
Board of Directors (including, if applicable, the entire Board of Directors of
ACSYS) administering such ACSYS Stock Plan, (ii) each ACSYS Option assumed by
ICCE may be exercised solely for shares of ICCE Common Stock, (iii) the number
of shares of ICCE Common Stock subject to such ACSYS Option shall be equal to
the number of shares of ACSYS Common Stock subject to such ACSYS Option
immediately prior to the Effective Time multiplied by the Exchange Ratio, and
(iv) the per share exercise price under each such ACSYS Option shall be adjusted
by dividing the per share exercise price under each such ACSYS Option by the
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Exchange Ratio and rounding up to the nearest cent. Notwithstanding the
provisions of clause (iii) of the preceding sentence, ICCE shall not be
obligated to issue any fraction of a share of ICCE Common Stock upon exercise of
ACSYS Options and any fraction of a share of ICCE Common Stock that otherwise
would be subject to a converted ACSYS Option shall represent the right to
receive a cash payment upon exercise of such converted ACSYS Option equal to the
product of such fraction and the difference between the market value of one
share of ICCE Common Stock at the time of exercise of such Option and the per
share exercise price of such Option. The market value of one share of ICCE
Common Stock at the time of exercise of an Option shall be the price determined
in accordance with the ICCE Stock Option Plan. In addition, notwithstanding
clauses (iii) and (iv) of the first sentence of this Section 3.7, each ACSYS
Option which is an "incentive stock option" (if any) shall be adjusted as
required by Section 424 of the Internal Revenue Code, and the regulations
promulgated thereunder, so as not to constitute a modification, extension or
renewal of the option, within the meaning of Section 424(h) of the Internal
Revenue Code. ACSYS and ICCE agree to take all necessary steps to effectuate the
foregoing provisions of this Section 3.7, including using its reasonable efforts
to obtain from each holder of a ACSYS Option any Consent or Contract that may be
deemed necessary or advisable in order to effect the transactions contemplated
by this Section 3.7.
(b) As soon as practicable after the Effective Time, ICCE shall
deliver to the participants in each ACSYS Stock Plan an appropriate notice
setting forth such participant's rights pursuant thereto and the grants subject
to such ACSYS Stock Plan shall continue in effect on the same terms and
conditions (subject to the adjustments required by Section 3.7(a) after giving
effect to the Merger), and ICCE shall comply with the terms of each ACSYS Stock
Plan to ensure, to the extent required by, and subject to the provisions of,
such ACSYS Stock Plan, that ACSYS Options which qualified as incentive stock
options prior to the Effective Time (if any) continue to qualify as incentive
stock options after the Effective Time. At or prior to the Effective Time, ICCE
shall take all corporate action necessary to reserve for issuance sufficient
shares of ICCE Common Stock for delivery upon exercise of ACSYS Options assumed
by it in accordance with this Section 3.7.
3.8 ESCROW ARRANGEMENTS. In connection with the Closing, ICCE and
-------------------
the ACSYS Shareholders will establish (or cause to be established) an escrow
account (the "Escrow") to satisfy the maximum aggregate payments that may be
required to be paid to ICCE pursuant to Section 8.1(a) arising out of a breach
of the representations and warranties contained in Section 4.5 ("Escrow
Claims"). Each ACSYS Shareholder shall contribute to the Escrow the number of
shares (rounded up to the nearest share) equal to the product of each share of
ICCE Common Stock held by such ACSYS Shareholder at the Effective Time
multiplied by the quotient obtained by dividing 129,000 by the number of shares
of ACSYS Common Stock held by ACSYS Shareholders immediately prior to the
Effective Time (so that the Escrow shall contain 129,005 shares of ICCE Common
Stock, after giving effect to such rounding-up). Upon satisfaction of all
Escrow Claims, the remaining escrowed amount relating to the satisfied claim,
reduced by payment of the fees and expenses of the escrow agent, will be
returned to the ACSYS Shareholders in proportion to their respective
contributions of ICCE Common Stock to the Escrow.
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3.9 ESCROW AGREEMENT. In connection with the Closing, ICCE, each
----------------
ACSYS Shareholder and the Indemnitor Representative for the ACSYS Shareholders
shall have executed and delivered to the other an escrow agreement (the "Escrow
Agreement"), which shall be in the form of Exhibit 1. The number of shares of
ICCE Common Stock set forth in Section 3.8 shall be issued pursuant to the terms
of the Escrow Agreement and held by ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇., as escrow agent.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ACSYS AND THE ACSYS SHAREHOLDERS
------------------------------------------------------------------
The ACSYS Shareholders and ACSYS, severally, not jointly, hereby
represent and warrant to ICCE as follows (except to the extent that any
exceptions are made with respect to these representations and warranties in the
ACSYS Disclosure Memorandum):
4.1 ORGANIZATION, STANDING, AND POWER. ACSYS is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the
Commonwealth of Pennsylvania, and has the corporate power and authority to carry
on its business as now conducted and to own, lease and operate its Assets.
ACSYS is duly qualified or licensed to transact business as a foreign
corporation in good standing in the States of the United States and foreign
jurisdictions where the character of its Assets or the nature or conduct of its
business requires it to be so qualified or licensed, except for such
jurisdictions in which the failure to be so qualified or licensed is not
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect. The minute book and other organizational documents for ACSYS
have been made available to ICCE for its review and, except as disclosed in
Section 4.1 of the ACSYS Disclosure Memorandum, are true and complete in all
material respects as in effect as of the date of this Agreement and accurately
reflect in all material respects all amendments thereto and all proceedings of
the Board of Directors and shareholders thereof. Except as set forth in Section
4.1 of the ACSYS Disclosure Memorandum, ACSYS has no Subsidiaries.
4.2 AUTHORITY OF ACSYS; NO BREACH BY AGREEMENT.
------------------------------------------
(a) ACSYS has the corporate power and authority necessary to
execute, deliver, and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery, and
performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly authorized
by all necessary corporate action in respect thereof on the part of ACSYS. This
Agreement represents a legal, valid, and binding obligation of ACSYS,
enforceable against ACSYS in accordance with its terms (except in all cases as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, conservatorship, moratorium, or similar Laws
affecting the enforcement of creditors' rights generally and except that the
availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding may
be brought).
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(b) Neither the execution and delivery of this Agreement by
ACSYS, nor the consummation by ACSYS of the transactions contemplated hereby,
nor compliance by ACSYS with any of the provisions hereof, will (i) conflict
with or result in a breach of any provision of ACSYS's Certificate of
Incorporation or Bylaws or the certificate or articles of incorporation or
bylaws of any ACSYS Subsidiary or any resolution adopted by the board of
directors or the shareholders of any ACSYS Entity, or (ii) except as disclosed
in Section 4.2 of the ACSYS Disclosure Memorandum, constitute or result in a
Default under, or require any Consent pursuant to, or result in the creation of
any Lien on any Asset of any ACSYS Entity under, any Contract or Permit of any
ACSYS Entity other than those which are not reasonably likely to have,
individually or in the aggregate, an ACSYS Material Adverse Effect, or, (iii)
subject to receipt of the requisite Consents referred to in Section 7.1(a),
constitute or result in a Default under, or require any Consent pursuant to, any
Law or Order applicable to any ACSYS Entity or any of their respective material
Assets (including any ICCE Entity or any ACSYS Entity becoming subject to or
liable for the payment of any Tax or any of the Assets owned by any ICCE Entity
or any ACSYS Entity being reassessed or revalued by any Taxing authority).
(c) Other than in connection or compliance with the provisions of
the Securities Laws and applicable state corporate and securities Laws, and
other than Consents required from Regulatory Authorities, and other than notices
to or filings with the Internal Revenue Service or the Pension Benefit Guaranty
Corporation with respect to any employee benefit plans, or under the HSR Act, no
notice to, filing with, or Consent of, any public body or authority is necessary
for the consummation by ACSYS of the Merger and the other transactions
contemplated in this Agreement.
4.3 AUTHORITY OF ACSYS SHAREHOLDERS; NO BREACH BY AGREEMENT.
-------------------------------------------------------
(a) Each of the ACSYS Shareholders has the absolute and
unrestricted right, power, authority, and capacity to execute and deliver this
Agreement and each of the Ancillary Agreements to which such ACSYS Shareholder
is party and to perform its obligations under this Agreement and such Ancillary
Agreements. This Agreement represents a legal, valid, and binding obligation of
each ACSYS Shareholder, enforceable against each ACSYS Shareholder in accordance
with its terms (except in all cases as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership,
conservatorship, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceeding may be brought). Upon the execution and
delivery by the ACSYS Shareholders of the Ancillary Agreements, the Ancillary
Agreements will constitute the legal, valid, and binding obligations of each
ACSYS Shareholder, enforceable against each ACSYS Shareholder in accordance with
their respective terms.
(b) Neither the execution and delivery of this Agreement by any
ACSYS Shareholder, nor the consummation by any ACSYS Shareholder of the
transactions contemplated hereby, nor compliance by any ACSYS Shareholder with
any of the provisions hereof, will (i) conflict with or result in a breach of
any provision of ACSYS's Certificate of Incorporation or Bylaws or the
certificate or articles of incorporation or bylaws of any ACSYS Subsidiary or
the
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governing instruments of any ACSYS Shareholder that is not a natural person, or
(ii) except as disclosed in Section 4.3 of the ACSYS Disclosure Memorandum,
constitute or result in a Default under, or require any Consent pursuant to, or
result in the creation of any Lien on any Asset of any ACSYS Entity under, any
Contract or Permit of any ACSYS Entity other than those which are not reasonably
likely to have, individually or in the aggregate, an ACSYS Material Adverse
Effect, or, (iii) subject to receipt of the requisite Consents referred to in
Section 7.1(a), violate any Law or Order applicable to any ACSYS Shareholder or
to any ACSYS Entity or any of their respective material Assets.
(c) Other than in connection or compliance with the provisions of
the Securities Laws, and applicable state corporate and securities Laws, and
other than Consents required from Regulatory Authorities, and other than notices
to or filings with the Internal Revenue Service or the Pension Benefit Guaranty
Corporation with respect to any employee benefit plans, or under the HSR Act, no
notice to, filing with, or Consent of, any public body or authority is necessary
for the consummation by the ACSYS Shareholders of the transactions contemplated
in this Agreement.
4.4 CAPITAL STOCK.
-------------
(a) The authorized capital stock of ACSYS consists of 60,000,000
shares of ACSYS Common Stock, of which 9,747,760 shares are issued and
outstanding. All of the issued and outstanding shares of capital stock of ACSYS
are duly and validly issued and outstanding and are fully paid and nonassessable
under the PBCL. None of the outstanding shares of capital stock of ACSYS has
been issued in violation of any preemptive rights of the current or past
shareholders of ACSYS. In addition, there are issued and outstanding option
agreements between ACSYS and a number of persons whereby such persons will have
the right to purchase an aggregate of an additional 297,500 shares of ACSYS
Common Stock (a listing of which option agreements is contained in the ACSYS
Disclosure Memorandum) (the "ACSYS Options").
(b) Except as set forth in Section 4.4(a), there are no shares of
capital stock or other equity securities of ACSYS outstanding and no outstanding
Equity Rights relating to the capital stock of ACSYS. Each of the ACSYS
Shareholders is the owner of all right, title and interest (legal and
beneficial) in and to that number or amount of Shares set forth next to his name
in Section 4.4(a) of the ACSYS Disclosure Memorandum, free and clear of all
Liens. Collectively, the ACSYS Shareholders own all right, title and interest
(legal and beneficial) in and to all of the issued and outstanding shares of
ACSYS's capital stock. Except as specifically contemplated by this Agreement
and set forth in Section 4.4(b) of the ACSYS Disclosure Memorandum, no Person
has any Contract or any right or privilege (whether pre-emptive or contractual)
capable of becoming a Contract for the purchase from the ACSYS Shareholders of
any of the Shares, or any Contract or Equity Right for the purchase,
subscription or issuance of any securities of ACSYS.
4.5 FINANCIAL STATEMENTS. Each of the ACSYS Financial Statements
--------------------
(including, in each case, any related notes) has been (i) prepared in accordance
with GAAP applied on a
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consistent basis throughout the periods involved (except as may be indicated in
the notes to such financial statements) and (ii) fairly presented in all
material respects the financial position of ACSYS and its Subsidiaries as at the
respective dates and the results of operations and cash flows for the periods
indicated, except that the unaudited interim financial statements were or are
subject to normal and recurring year-end adjustments which were not or are not
expected to be material in amount or effect.
4.6 ABSENCE OF UNDISCLOSED LIABILITIES. Except as disclosed in
----------------------------------
Section 4.6 of the ACSYS Disclosure Memorandum, no ACSYS Entity has any
Liabilities that are reasonably likely to have, individually or in the
aggregate, an ACSYS Material Adverse Effect, except Liabilities which are
accrued or reserved against in the balance sheets of ACSYS and its Subsidiaries
as of June 30, 1997, included in the ACSYS Financial Statements delivered prior
to the date of this Agreement or reflected in the notes thereto. No ACSYS
Entity has incurred or paid any Liability since June 30, 1997, except for such
Liabilities incurred or paid (i) in the ordinary course of business consistent
with past business practice and which are not reasonably likely to have,
individually or in the aggregate, an ACSYS Material Adverse Effect or (ii) in
connection with the transactions contemplated by this Agreement. Except as
disclosed in Section 4.6 of the ACSYS Disclosure Memorandum, no ACSYS Entity is
directly or indirectly liable, by guarantee, indemnity, or otherwise, upon or
with respect to, or obligated, by discount or repurchase agreement or in any
other way, to provide funds in respect to, or obligated to guarantee or assume
any Liability of any Person for any amounts in excess of $10,000 in the
aggregate.
4.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since June 30, 1997,
------------------------------------
except as disclosed in Section 4.7 of the ACSYS Disclosure Memorandum, (i) there
have been no events, changes, or occurrences which have had, or are reasonably
likely to have, individually or in the aggregate, an ACSYS Material Adverse
Effect, and (ii) the ACSYS Entities have not:
(a) incurred any additional debt obligation or other obligation
for borrowed money (other than indebtedness of a ACSYS Entity to another
ACSYS Entity) in excess of an aggregate of $50,000 (for the ACSYS Entities on
a consolidated basis) except in the ordinary course of the business
consistent with past practices; or
(b) repurchased, redeemed, or otherwise acquired or exchanged,
directly or indirectly, any shares, or any securities convertible into any
shares, of the capital stock of any ACSYS Entity, or declared or paid any
dividend or made any other distribution in respect of ACSYS's capital stock;
or
(c) sold, leased, mortgaged or otherwise disposed of or otherwise
encumbered (x) any shares of capital stock of any ACSYS Subsidiary or (y) any
Assets having a book value in excess of $10,000 in the aggregate other than
in the ordinary course of business for reasonable and adequate consideration;
or
(d) purchased any securities or made any material investment,
either by purchase of stock of securities, contributions to capital, Asset
transfers, or purchase of any
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Assets, in any Person other than a wholly owned ACSYS Subsidiary, or
otherwise acquired direct or indirect control over any Person; or
(e) granted any increase in compensation or benefits to the
employees or officers of any ACSYS Entity, except in accordance with past
practice or as required by Law or entered into or amended any severance
agreements with officers of any ACSYS Entity; or
(f) made any significant change in any Tax or accounting methods
or systems of internal accounting controls, except to conform to changes in
Tax Laws or GAAP; or
(g) commenced any Litigation other than in accordance with past
practice or settled any Litigation involving any Liability of any ACSYS
Entity for material money damages or restrictions upon the operations of any
ACSYS Entity.
4.8 TAX MATTERS.
-----------
(a) Except as set forth in Section 4.8(a) of the ACSYS Disclosure
Memorandum, since the incorporation of ACSYS, it has duly elected to be, and has
always been, treated as an S Corporation under Subchapter S of the Internal
Revenue Code with respect to Federal and all applicable state and local
jurisdictions, and has never been subject to Subchapter C of the Internal
Revenue Code. Such election was timely and validly made in all such
jurisdictions, remains in full force and effect, and has not been and will not
be revoked or terminated, intentionally or inadvertently, prior to the Effective
Time. Except for the transactions contemplated by this Agreement, neither ACSYS
nor any ACSYS Shareholder nor any other or previous ACSYS shareholder has taken
any action or caused any action to be taken which would have the effect of
causing ACSYS's S Corporation election to be terminated.
(b) Except as set forth in Section 4.8(b) of the ACSYS Disclosure
Memorandum, there does not exist and will not after the Effective Time exist any
Liability for Taxes which may be asserted by any taxing authority against, and
no Lien for Taxes will attach to, any ACSYS Entity or any of their respective
Assets, except for taxes incurred in the ordinary course of business which are
not due and payable at the time of execution of this Agreement. All Tax returns
required to be filed by or on behalf of any of the ACSYS Entities have been
timely filed or requests for extensions have been timely filed, granted, and
have not expired for periods ended on or before December 31, 1996, and on or
before the date of the most recent fiscal year end immediately preceding the
Effective Time, and all Tax returns filed are complete and accurate in all
material respects. All Taxes shown on filed Tax returns have been paid. There
is no audit examination, deficiency, or refund Litigation with respect to any
Taxes. All Taxes and other Liabilities due with respect to completed and
settled examinations or concluded Litigation have been paid.
(c) None of the ACSYS Entities has executed an extension or
waiver of any statute of limitations on the assessment or collection of any Tax
due (excluding such statutes that
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relate to years currently under examination by the Internal Revenue Service or
other applicable taxing authorities) that is currently in effect.
(d) None of the ACSYS Entities is a party to any Tax allocation
or sharing agreement and none of the ACSYS Entities has any Liability for Taxes
of any Person (other than ACSYS and its Subsidiaries) under Treasury Regulation
Section 1.1502-6 (or any similar provision of state, local or foreign Law) as a
transferee or successor or by Contract or otherwise. None of the ACSYS Entities
has been a member of an affiliated group filing a consolidated federal income
Tax Return (other than a group the common parent of which was ACSYS).
(e) Except as set forth in Section 4.8(e) of the ACSYS Disclosure
Memorandum, each of the ACSYS Entities is in compliance with, and its records
contain all information and documents necessary to comply with, all applicable
information reporting and Tax withholding requirements under federal, state, and
local Tax Laws, and such records identify with specificity all accounts subject
to backup withholding under Section 3406 of the Internal Revenue Code.
(f) No ACSYS Entity has or has had in any foreign country a
permanent establishment, as defined in any applicable tax treaty or convention
between the United States and such foreign country.
4.9 ASSETS.
------
(a) Except as disclosed in Section 4.9 of the ACSYS Disclosure
Memorandum, the ACSYS Entities have good and marketable title, free and clear of
all Liens, to all of their respective Assets, except for any such Liens or other
defects of title which are not reasonably likely to have a material adverse
effect on the use or value of such Asset or any other Asset. All tangible
properties which are material to the businesses of the ACSYS Entities are in
good condition, reasonable wear and tear excepted.
(b) Except as disclosed in Section 4.9 of the ACSYS Disclosure
Memorandum, the accounts receivable of the ACSYS Entities as set forth on the
most recent balance sheet included in the ACSYS Financial Statements delivered
prior to the date of this Agreement or arising since the date thereof are valid
and genuine; have arisen solely out of bona fide performance of services, sales
and deliveries of goods, and other business transactions in the ordinary course
of business consistent with past practice; and are not subject to valid
defenses, set-offs or counterclaims and are collectible at the full recorded
amount thereof except to the extent of any reserves for collection losses set
forth in the ACSYS Financial Statements.
(c) All Assets which are material to ACSYS's business on a
consolidated basis, held under leases or subleases by any of the ACSYS Entities,
are held under valid Contracts enforceable in accordance with their respective
terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or other Laws affecting the enforcement
of creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the
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court before which any proceedings may be brought), and each such Contract is in
full force and effect.
(d) None of the ACSYS Entities has received notice from any
insurance carrier that (i) any policy of insurance will be canceled or that
coverage thereunder will be reduced or eliminated, or (ii) premium costs with
respect to such policies of insurance will be substantially increased. There are
presently no claims for amounts exceeding in any individual case $5,000 pending
under such policies of insurance and no notices of claims in excess of such
amounts have been given by any ACSYS Entity under such policies, other than any
claims that may be incurred under the self-insured portion of any medical plan
maintained by any ACSYS Entity.
(e) The Assets of the ACSYS Entities include all Assets required
to operate the business of the ACSYS Entities as presently conducted.
4.10 INTELLECTUAL PROPERTY. Each ACSYS Entity owns or has a license
---------------------
to use all of the Intellectual Property used by such ACSYS Entity in the course
of its business. Each ACSYS Entity is the owner of or has a license to any
Intellectual Property sold or licensed to a third party by such ACSYS Entity in
connection with such ACSYS Entity's business operations, and such ACSYS Entity
has the right to convey by sale or license any Intellectual Property so
conveyed. No ACSYS Entity is in Default under any of its Intellectual Property
licenses. No proceedings have been instituted or are pending (in which an ACSYS
Entity has received process or otherwise has Knowledge of the existence thereof)
or, to the Knowledge of ACSYS threatened, which challenge the rights of any
ACSYS Entity with respect to Intellectual Property used, sold or licensed by
such ACSYS Entity in the course of its business, nor has any person claimed or
alleged any rights to such Intellectual Property. To the Knowledge of ACSYS,
the conduct of the business of the ACSYS Entities does not infringe any
Intellectual Property of any other person. Except as disclosed in Section 4.10
of the ACSYS Disclosure Memorandum, no ACSYS Entity is obligated to pay any
recurring royalties to any Person with respect to any such Intellectual
Property. Except as disclosed in Section 4.10 of the ACSYS Disclosure
Memorandum, all rights to Intellectual Property developed by or for any ACSYS
Entity are owned solely by the ACSYS Entities and have either been produced by
employees of the ACSYS Entities as works for hire under Federal copyright law or
have been assigned to the ACSYS Entities in enforceable technology transfer
agreements.
4.11 ENVIRONMENTAL MATTERS.
---------------------
(a) To the Knowledge of ACSYS, each ACSYS Entity, its
Participation Facilities, and its Operating Properties are, and have been, in
compliance with all Environmental Laws, except for violations which are not
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect.
(b) To the Knowledge of ACSYS, there is no Litigation pending (in
which an ACSYS Entity has received process or otherwise has Knowledge of the
existence thereof) or threatened before any court, governmental agency, or
authority or other forum in which any
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ACSYS Entity or any of its Operating Properties or Participation Facilities (or
ACSYS in respect of such Operating Property or Participation Facility) has been
or, with respect to threatened Litigation, may be named as a defendant (i) for
alleged noncompliance (including by any predecessor) with any Environmental Law
or (ii) relating to the release, discharge, spillage, or disposal into the
environment of any Hazardous Material, whether or not occurring at, on, under,
adjacent to, or affecting (or potentially affecting) a site owned, leased, or
operated by any ACSYS Entity or any of its Operating Properties or Participation
Facilities, except for such Litigation pending or threatened that is not
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect, nor to the Knowledge of ACSYS is there any reasonable basis for
any Litigation of a type described in this sentence, except such as is not
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect.
(c) To the Knowledge of ACSYS, there have been no releases,
discharges, spillages, or disposals of Hazardous Material in, on, under,
adjacent to, or affecting (or potentially affecting) such properties, except
such as are not reasonably likely to have, individually or in the aggregate, an
ACSYS Material Adverse Effect.
4.12 COMPLIANCE WITH LAWS. Each ACSYS Entity has in effect all
--------------------
Permits necessary for it to own, lease, or operate its material Assets and to
carry on its business as now conducted, except for those Permits the absence of
which are not reasonably likely to have, individually or in the aggregate, an
ACSYS Material Adverse Effect, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, an ACSYS Material Adverse Effect. Except as
disclosed in Section 4.12 of the ACSYS Disclosure Memorandum, none of the ACSYS
Entities:
(a) is in Default under any of the provisions of its Certificate
of Incorporation or Bylaws (or other governing instruments);
(b) is in Default under any Laws, Orders, or Permits applicable
to its business or employees conducting its business (including the
Immigration Reform and Control Act of 1986, as amended, and all applicable
regulations promulgated thereunder and Laws requiring the licensing of
temporary employee staffing companies or otherwise subjecting temporary
employee staffing companies to regulation), except for Defaults which are not
reasonably likely to have, individually or in the aggregate, an ACSYS
Material Adverse Effect; or
(c) since January 1, 1993, has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting
that any ACSYS Entity is not in compliance with any of the Laws or Orders
which such governmental authority or Regulatory Authority enforces, (ii)
threatening to revoke any Permits, the revocation of which is reasonably
likely to have, individually or in the aggregate, an ACSYS Material Adverse
Effect, or (iii) requiring any ACSYS Entity to enter into or consent to the
issuance of a cease and desist order, formal agreement, directive,
commitment, or memorandum of understanding,
-14-
or to adopt any Board resolution or similar undertaking, which restricts
materially the conduct of its business.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action against any ACSYS Entity by a Regulatory Authority have been
made available to ICCE.
4.13 LABOR AND EMPLOYMENT MATTERS. No ACSYS Entity is the subject of
----------------------------
any Litigation (in which ACSYS has received process or otherwise has Knowledge
of the existence thereof) asserting that it or any other ACSYS Entity has
committed an unfair labor practice (within the meaning of the National Labor
Relations Act or comparable state law) or seeking to compel it or any other
ACSYS Entity to bargain with any labor organization as to wages or conditions of
employment, nor is any ACSYS Entity party to any collective bargaining
agreement, nor is there any strike or other labor dispute involving any ACSYS
Entity, pending or threatened, or to the Knowledge of ACSYS, is there any
activity involving any ACSYS Entity's employees seeking to certify a collective
bargaining unit or engaging in any other organization activity. No ACSYS Entity
has ever engaged in Employee Leasing.
4.14 EMPLOYEE BENEFIT PLANS.
----------------------
(a) ACSYS has disclosed in Section 4.14 of the ACSYS Disclosure
Memorandum or has delivered or made available to ICCE prior to the execution of
this Agreement, copies in each case of, all pension, retirement, profit-sharing,
deferred compensation, stock option, employee stock ownership, severance pay,
vacation, bonus, or other incentive plans, all other written employee programs,
arrangements, or agreements, all medical, vision, dental, or other health plans,
all life insurance plans, and all other employee benefit plans or fringe benefit
plans, including "employee benefit plans" as that term is defined in Section
3(3) of ERISA, currently adopted, maintained by, sponsored in whole or in part
by, or contributed to by any ACSYS Entity or ERISA Affiliate thereof for the
benefit of employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries and under which employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
are eligible to participate (collectively, the "ACSYS Benefit Plans"). Any of
the ACSYS Benefit Plans which is an "employee pension benefit plan," as that
term is defined in Section 3(2) of ERISA, is referred to herein as an "ACSYS
ERISA Plan." Each ACSYS ERISA Plan which is also a "defined benefit plan" (as
defined in Section 414(j) of the Internal Revenue Code) is referred to herein as
a "ACSYS Pension Plan." No ACSYS Pension Plan is or has been a multiemployer
plan within the meaning of Section 3(37) of ERISA.
(b) All ACSYS Benefit Plans are in substantial compliance with
the applicable terms of ERISA, the Internal Revenue Code, and any other
applicable Laws so that any breach or violation of such laws would not be
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect. Each ACSYS ERISA Plan which is intended to be qualified under
Section 401(a) of the Internal Revenue Code has received a favorable
determination letter from the Internal Revenue Service, and ACSYS is not aware
of any circumstances likely to result in revocation of any such favorable
determination letter. No
-15-
ACSYS Entity has engaged in a transaction with respect to any ACSYS Benefit Plan
that, assuming the taxable period of such transaction expired as of the date
hereof, would subject any ACSYS Entity to a Tax imposed by either Section 4975
of the Internal Revenue Code or Section 502(i) of ERISA.
(c) No ACSYS Pension Plan has any "unfunded current liability," as
that term is defined in Section 302(d)(8)(A) of ERISA, and the fair market value
of the assets of any such plan exceeds the plan's "benefit liabilities," as that
term is defined in Section 4001(a)(16) of ERISA, when determined under actuarial
factors that would apply if the plan terminated in accordance with all
applicable legal requirements. Since the date of the most recent actuarial
valuation, there has been (i) no material change in the financial position of
any ACSYS Pension Plan, (ii) no change in the actuarial assumptions with respect
to any ACSYS Pension Plan, and (iii) no increase in benefits under any ACSYS
Pension Plan as a result of plan amendments or changes in applicable Law which
is reasonably likely to have, individually or in the aggregate, an ACSYS
Material Adverse Effect or materially adversely affect the funding status of any
such plan. Neither any ACSYS Pension Plan nor any "single-employer plan,"
within the meaning of Section 4001(a)(15) of ERISA, currently or formerly
maintained by any ACSYS Entity, or the single-employer plan of any entity which
is considered one employer with ACSYS under Section 4001 of ERISA or Section 414
of the Internal Revenue Code or Section 302 of ERISA (whether or not waived) (an
"ERISA Affiliate") has an "accumulated funding deficiency" within the meaning of
Section 412 of the Internal Revenue Code or Section 302 of ERISA. No ACSYS
Entity has provided, or is required to provide, security to an ACSYS Pension
Plan or to any single-employer plan of an ERISA Affiliate pursuant to Section
401(a)(29) of the Internal Revenue Code.
(d) No Liability under Subtitle C or D of Title IV of ERISA has been
or is expected to be incurred by any ACSYS Entity with respect to any ongoing,
frozen, or terminated single-employer plan or the single-employer plan of any
ERISA Affiliate. No ACSYS Entity has incurred any withdrawal Liability with
respect to a multiemployer plan under Subtitle B of Title IV of ERISA
(regardless of whether based on contributions of an ERISA Affiliate). No notice
of a "reportable event," within the meaning of Section 4043 of ERISA for which
the 30-day reporting requirement has not been waived, has been required to be
filed for any ACSYS Pension Plan or by any ERISA Affiliate within the 12-month
period ending on the date hereof.
(e) Except as disclosed in Section 4.14 of the ACSYS Disclosure
Memorandum, no ACSYS Entity has any Liability for retiree health and life
benefits under any of the ACSYS Benefit Plans and there are no restrictions on
the rights of such ACSYS Entity to amend or terminate any such retiree health or
benefit Plan without incurring any Liability thereunder.
(f) Except as disclosed in Section 4.14 of the ACSYS Disclosure
Memorandum, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of any ACSYS Entity from
any ACSYS Entity under any ACSYS Benefit Plan or
-16-
otherwise, (ii) increase any benefits otherwise payable under any ACSYS Benefit
Plan, or (iii) result in any acceleration of the time of payment or vesting of
any such benefit.
(g) The actuarial present values of all accrued deferred compensation
entitlements (including entitlements under any executive compensation,
supplemental retirement, or employment agreement) of employees and former
employees of any ACSYS Entity and their respective beneficiaries, other than
entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of ERISA,
have been fully reflected on the ACSYS Financial Statements to the extent
required by and in accordance with GAAP.
4.15 MATERIAL CONTRACTS. Except as disclosed in Section 4.15 of the
------------------
ACSYS Disclosure Memorandum, none of the ACSYS Entities, nor any of their
respective Assets, businesses, or operations, is a party to, or is bound or
affected by, or receives benefits under, (i) any employment, severance,
termination, consulting, or retirement Contract providing for aggregate payments
to any Person in any calendar year in excess of $50,000, (ii) any Contract
relating to the borrowing of money by any ACSYS Entity or the guarantee by any
ACSYS Entity of any such obligation (other than Contracts evidencing trade
payables and Contracts relating to borrowings or guarantees made in the ordinary
course of business), (iii) any Contract which prohibits or restricts any ACSYS
Entity from engaging in any business activities in any geographic area, line of
business or otherwise in competition with any other Person, (iv) any Contract
involving Intellectual Property (other than Contracts entered into in the
ordinary course with customers and "shrink-wrap" software licenses), (v) any
Contract relating to the provision of data processing, network communication, or
other technical services to any ACSYS Entity, and (vi) any Contract relating to
the purchase or sale of any goods or the purchase of any services (other than
Contracts entered into in the ordinary course of business and involving payments
under any individual Contract not in excess of $50,000) (together with all
Contracts referred to in Sections 4.9 and 4.14(a), the "ACSYS Contracts"). With
respect to each ACSYS Contract and except as disclosed in Section 4.15 of the
ACSYS Disclosure Memorandum: (i) the Contract is in full force and effect; (ii)
no ACSYS Entity is in Default thereunder; (iii) no ACSYS Entity has repudiated
or waived any material provision of any such Contract in any material respect;
and (iv) no other party to any such Contract is, to the Knowledge of ACSYS, in
Default in any respect or has repudiated or waived any material provision
thereunder. Except as stated in Section 4.15 of the ACSYS Disclosure
Memorandum, all of the indebtedness of any ACSYS Entity for money borrowed is
prepayable at any time by such ACSYS Entity without penalty or premium.
4.16 LEGAL PROCEEDINGS. There is no Litigation instituted or pending
-----------------
(in which an ACSYS Entity has received process or otherwise has Knowledge of the
existence thereof), or, to the Knowledge of ACSYS, threatened against any ACSYS
Entity, or against any director or employee benefit plan of any ACSYS Entity, or
against any Asset, interest, or right of any of them, that is reasonably likely
to have, individually or in the aggregate, an ACSYS Material Adverse Effect, nor
are there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against any ACSYS Entity, that are
reasonably likely to have, individually or in the aggregate, an ACSYS Material
Adverse Effect. Section 4.16 of the
-17-
ACSYS Disclosure Memorandum contains a summary of all Litigation as of the date
of this Agreement to which any ACSYS Entity is a party and which names a ACSYS
Entity as a defendant or cross-defendant or for which any ACSYS Entity has any
potential Liability (other than Liability for the fees and expenses of its own
counsel).
4.17 REPORTS. Since January 1, 1993, or the date of organization if
-------
later, each ACSYS Entity has timely filed all reports and statements, together
with any amendments required to be made with respect thereto, that it was
required to file with Regulatory Authorities (except, in the case of state
securities authorities, failures to file which are not reasonably likely to
have, individually or in the aggregate, an ACSYS Material Adverse Effect). As
of their respective dates, each of such reports and documents, including the
financial statements, exhibits, and schedules thereto, have been in compliance
in all material respects with all applicable Laws. As of its respective date,
each such report and document did not, in all material respects, contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements made therein, in light of
the circumstances under which they were made, not misleading.
4.18 STATEMENTS TRUE AND CORRECT. No statement, certificate,
---------------------------
instrument, or other writing furnished or to be furnished by any ACSYS Entity,
any ACSYS Shareholder or any Affiliate thereof to ICCE pursuant to this
Agreement or any other document, agreement, or instrument referred to herein
contains or will contain any untrue statement of material fact or will omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. All documents that
any ACSYS Entity, any ACSYS Shareholder or any Affiliate thereof is responsible
for filing with any Regulatory Authority in connection with the transactions
contemplated hereby will comply as to form in all material respects with the
provisions of applicable Law.
4.19 ACCOUNTING, TAX AND REGULATORY MATTERS. No ACSYS Entity or any
--------------------------------------
ACSYS Shareholder or any Affiliate thereof has taken or agreed to take any
action or has any Knowledge of any fact or circumstance that is reasonably
likely to (i) prevent the Merger from qualifying for pooling-of-interests
accounting treatment or as a reorganization within the meaning of Section 368(a)
of the Internal Revenue Code, or (ii) materially impede or delay receipt of any
Consents of Regulatory Authorities referred to in Section 7.1(a) or result in
the imposition of a condition or restriction of the type referred to in the last
sentence of such Section.
4.20 INVESTMENT INTENTION. Each ACSYS Shareholder is acquiring the
--------------------
shares of ICCE Common Stock to be issued pursuant to this Agreement for
investment only, for such ACSYS Shareholder's own account and not as a nominee
or agent, and not with the view to, or for resale in connection with, any
distribution thereof or participation therein. Each ACSYS Shareholder is an
"accredited investor" as such term is defined in Rule 501(a) under the
Securities Act. Each ACSYS Shareholder understands that the shares of ICCE
Common Stock to be issued pursuant to this Agreement have not been, and will not
be, registered under the 1933 Act in reliance upon the representations set forth
herein.
-18-
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF ICCE AND THE ICCE SHAREHOLDERS
----------------------------------------------------------------
The ICCE Shareholders and ICCE, severally, not jointly, hereby
represent and warrant to ACSYS and the ACSYS Shareholders as follows (except to
the extent that any exceptions are made with respect to these representations
and warranties in the ICCE Disclosure Memorandum):
5.1 ORGANIZATION, STANDING, AND POWER. ICCE is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the State of
Georgia, and has the corporate power and authority to carry on its business as
now conducted and to own, lease and operate its Assets. ICCE is duly qualified
or licensed to transact business as a foreign corporation in good standing in
the States of the United States and foreign jurisdictions where the character of
its Assets or the nature or conduct of its business requires it to be so
qualified or licensed, except for such jurisdictions in which the failure to be
so qualified or licensed is not reasonably likely to have, individually or in
the aggregate, an ICCE Material Adverse Effect. The minute book and other
organizational documents for ICCE have been made available to ACSYS and the
ACSYS Shareholders for its review and, except as disclosed in Section 5.1 of the
ICCE Disclosure Memorandum, are true and complete in all material respects as in
effect as of the date of this Agreement and accurately reflect in all material
respects all amendments thereto and all proceedings of the Board of Directors
and shareholders thereof. Except as set forth in Section 5.1 of the ICCE
Disclosure Memorandum, ICCE has no Subsidiaries.
5.2 AUTHORITY; NO BREACH BY AGREEMENT.
---------------------------------
(a) ICCE has the corporate power and authority necessary to execute,
deliver and perform its obligations under this Agreement and each of the
Ancillary Documents to which ICCE is a party and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of ICCE. This Agreement
represents a legal, valid, and binding obligation of ICCE, enforceable against
ICCE in accordance with its terms (except in all cases as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,
receivership, conservatorship, moratorium, or similar Laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by ICCE, nor
the consummation by ICCE of the transactions contemplated hereby, nor compliance
by ICCE with any of the provisions hereof, will (i) conflict with or result in a
breach of any provision of ICCE's Articles of Incorporation or Bylaws or the
certificate or articles of incorporation or bylaws of any ICCE Subsidiary, or
any resolution adopted by the board of directors or the shareholders of any ICCE
Entity, or (ii) except as disclosed in Section 5.2 of the ICCE Disclosure
Memorandum,
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constitute or result in a Default under, or require any Consent pursuant to, or
result in the creation of any Lien on any Asset of any ICCE Entity under, any
Contract or Permit of any ICCE Entity other than those which are not reasonably
likely to have, individually or in the aggregate, an ICCE Material Adverse
Effect, or, (iii) subject to receipt of the requisite Consents referred to in
Section 7.1(a), constitute or result in a Default under, or require any Consent
pursuant to, any Law or Order applicable to any ICCE Entity or any of their
respective material Assets (including any ICCE Entity or any ACSYS Entity
becoming subject to or liable for the payment of any Tax or any of the Assets
owned by any ICCE Entity or any ACSYS Entity being reassessed or revalued by any
Taxing authority).
(c) Other than in connection or compliance with the provisions of the
Securities Laws and applicable state corporate and securities Laws, and other
than Consents required from Regulatory Authorities, and other than notices to or
filings with the Internal Revenue Service or the Pension Benefit Guaranty
Corporation with respect to any employee benefit plans, or under the HSR Act, no
notice to, filing with, or Consent of, any public body or authority is necessary
for the consummation by ICCE of the Merger and the other transactions
contemplated in this Agreement.
5.3 CAPITAL STOCK.
-------------
(a) The authorized capital stock of ICCE consists of (i) 45,000,000
shares of ICCE Common Stock, of which 4,833,721 shares are issued and
outstanding as of the date of this Agreement, and (ii) 5,000,000 shares of ICCE
Preferred Stock, none of which are issued and outstanding. All of the issued
and outstanding shares of ICCE Capital Stock are, and all of the shares of ICCE
Common Stock to be issued in exchange for shares of ACSYS Common Stock upon
consummation of the Merger, when issued in accordance with the terms of this
Agreement, will be, duly and validly issued and outstanding and fully paid and
nonassessable under the GBCC. None of the outstanding shares of ICCE Capital
Stock has been, and none of the shares of ICCE Common Stock to be issued in
exchange for shares of ACSYS Common Stock upon consummation of the Merger will
be, issued in violation of any preemptive rights of the current or past
shareholders of ICCE.
(b) Except as set forth in Section 5.3(a), or as disclosed in Section
5.3(b) of the ICCE Disclosure Memorandum, there are no shares of capital stock
or other equity securities of ICCE outstanding and no outstanding Equity Rights
relating to the capital stock of ICCE. Except as specifically contemplated by
this Agreement and set forth in Section 5.3(b) of the ICCE Disclosure
Memorandum, no Person has any Contract or any right or privilege (whether pre-
emptive or contractual) capable of becoming any Contract or Equity Right for the
purchase, subscription or issuance of any securities of ICCE.
5.4 FINANCIAL STATEMENTS. Except as disclosed in Section 5.4 of the
--------------------
ICCE Disclosure Memorandum, each of the ICCE Financial Statements (including, in
each case, any related notes) has been (i) prepared in accordance with GAAP
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes to such financial statements) and (ii) fairly presented
in all material respects the consolidated financial position of
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ICCE and its Subsidiaries as at the respective dates and the consolidated
results of operations and cash flows for the periods indicated, except that the
unaudited interim financial statements were or are subject to normal and
recurring year-end adjustments which were not or are not expected to be material
in amount or effect.
5.5 ABSENCE OF UNDISCLOSED LIABILITIES. Except as disclosed in Section 5.5
----------------------------------
of the ICCE Disclosure Memorandum, no ICCE Entity has any Liabilities that are
reasonably likely to have, individually or in the aggregate, an ICCE Material
Adverse Effect, except Liabilities which are accrued or reserved against in the
consolidated balance sheet of ICCE as of June 30, 1997, included in the ICCE
Financial Statements delivered prior to the date of this Agreement or reflected
in the notes thereto. No ICCE Entity has incurred or paid any Liability since
June 30, 1997, except for such Liabilities incurred or paid (i) in the ordinary
course of business consistent with past business practice and which are not
reasonably likely to have, individually or in the aggregate, an ICCE Material
Adverse Effect or (ii) in connection with the transactions contemplated by this
Agreement. Except as disclosed in Section 5.5 of the ICCE Disclosure Memorandum,
no ICCE Entity is directly or indirectly liable, by guarantee, indemnity or
otherwise, upon or with respect to, or obligated by discount or repurchase
agreement or in any other way, to provide funds in respect to, or obligated to
guarantee or assume, any Liability of any Person for any amounts in excess of
$10,000 in the aggregate.
5.6 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since June 30, 1997, except as
------------------------------------
disclosed in Section 5.6 of the ICCE Disclosure Memorandum, (i) there have been
no events, changes or occurrences which have had, or are reasonably likely to
have, individually or in the aggregate, an ICCE Material Adverse Effect, and
(ii) the ICCE Entities have not:
(a) incurred any additional debt obligation or other obligation for
borrowed money (other than indebtedness of a ICCE Entity to another ICCE
Entity) in excess of an aggregate of $50,000 (for the ICCE Entities on a
consolidated basis) except in the ordinary course of the business consistent
with past practices; or
(b) repurchased, redeemed, or otherwise acquired or exchanged,
directly or indirectly, any shares, or any securities convertible into any
shares, of the capital stock of any ICCE Entity, or declared or paid any
dividend or made any other distribution in respect of ICCE's capital stock;
or
(c) made any significant change in any Tax or accounting methods or
systems of internal accounting controls, except to conform to changes in Tax
Laws or GAAP; or
(d) sold, leased, mortgaged or otherwise disposed of or otherwise
encumbered (x) any shares of capital stock of any ICCE Subsidiary or (y) any
Assets having a book value in excess of $10,000 in the aggregate other than
in the ordinary course of business for reasonable and adequate
consideration; or
(e) purchased any securities or made any material investment, either
by purchase of stock or securities, contributions to capital, Asset
transfers, or purchase of any
-21-
Assets, in any Person other than a wholly owned ICCE Subsidiary, or
otherwise acquired direct or indirect control over any Person; or
(f) granted any increase in compensation or benefits to the employees
or officers of any ICCE Entity, except in accordance with past practice or
as required by Law or entered into or amended any severance agreements with
officers of any ICCE Entity; or
(g) commenced any Litigation other than in accordance with past
practice or settled any Litigation involving any Liability of any ICCE
Entity for material money damages or restrictions upon the operations of any
ICCE Entity.
5.7 TAX MATTERS.
-----------
(a) Since the incorporation of ICCE, it has duly elected to be, and
has always been, treated as an S Corporation under Subchapter S of the Internal
Revenue Code with respect to Federal and all applicable state and local
jurisdictions, and has never been subject to Subchapter C of the Internal
Revenue Code. Such election was timely and validly made in all such
jurisdictions, remains in full force and effect, and has not been and will not
be revoked or terminated, intentionally or inadvertently, prior to the Effective
Time. Neither ICCE nor any present or previous ICCE shareholder has taken any
action or caused any action to be taken which would have the effect of causing
ICCE's S Corpo ration election to be terminated.
(b) There does not exist and will not after the Effective Time exist
any Liability for Taxes which may be asserted by any taxing authority against,
and no Lien for Taxes will attach to, any ICCE Entity or any of their respective
Assets. All Tax Returns required to be filed by or on behalf of any of the ICCE
Entities have been timely filed or requests for extensions have been timely
filed, granted, and have not expired for periods ended on or before December 31,
1996, and on or before the date of the most recent fiscal year end immediately
preceding the Effective Time, and all Tax Returns filed are complete and
accurate in all material respects. All Taxes shown on filed Tax Returns have
been paid. There is no audit examination, deficiency, or refund Litigation with
respect to any Taxes. All Taxes and other Liabilities due with respect to
completed and settled examinations or concluded Litigation have been paid.
(c) None of the ICCE Entities is a party to any Tax allocation or
sharing agreement with any Person that is not an ICCE Entity and none of the
ICCE Entities has been a member of an affiliated group filing a consolidated
federal income Tax Return (other than a group the common parent of which was
ICCE) or has any Liability for Taxes of any Person (other than ICCE and its
Subsidiaries) under Treasury Regulation Section 1.1502-6 (or any similar
provision of state, local or foreign Law) as a transferee or successor or by
Contract or otherwise.
(d) None of the ICCE Entities has executed an extension or waiver of
any statute of limitations on the assessment or collection of any Tax due
(excluding such statutes that relate to years currently under examination by the
Internal Revenue Service or other applicable taxing authorities) that is
currently in effect.
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(e) Each of the ICCE Entities is in compliance with, and its records
contain all information and documents necessary to comply with, all applicable
information reporting and Tax withholding requirements under federal, state, and
local Tax Laws, and such records identify with specificity all accounts subject
to backup withholding under Section 3406 of the Internal Revenue Code.
(f) No ICCE Entity has or has had in any foreign country a permanent
establishment, as defined in any applicable tax treaty or convention between the
United States and such foreign country.
5.8 ASSETS.
------
(a) Except as disclosed in Section 5.8 of the ICCE Disclosure
Memorandum, the ICCE Entities have good and marketable title, free and clear of
all Liens, to all of their respective Assets, except for any such Liens or other
defects of title which are not reasonably likely to have a material adverse
effect on the use or value of such Asset or any other Asset. All tangible
properties which are material to the businesses of the ICCE Entities are in good
condition, reasonable wear and tear excepted.
(b) All Assets which are material to ICCE's business on a
consolidated basis, held under leases or subleases by any of the ICCE Entities,
are held under valid Contracts enforceable in accordance with their respective
terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or other Laws affecting the enforcement
of creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceedings may be brought), and each such
Contract is in full force and effect.
(c) Except as disclosed in Section 5.8 of the ICCE Disclosure
Memorandum, the accounts receivable of the ICCE Entities as set forth on the
most recent balance sheet included in the ICCE Financial Statements delivered
prior to the date of this Agreement or arising since the date thereof are valid
and genuine; have arisen solely out of bona fide performance of services, sales
and deliveries of goods, and other business transactions in the ordinary course
of business consistent with past practice; and are not subject to valid
defenses, set-offs or counterclaims and are collectible at the full recorded
amount thereof except to the extent of any reserves for collection losses set
forth in the ICCE Financial Statements.
(d) None of the ICCE Entities has received notice from any insurance
carrier that (i) any policy of insurance will be canceled or that coverage
thereunder will be reduced or eliminated, or (ii) premium costs with respect to
such policies of insurance will be substantially increased. There are presently
no claims for amounts exceeding in any individual case $5,000 pending under such
policies of insurance and no notices of claims in excess of such amounts have
been given by any ICCE Entity under such policies, other than any claims that
may be incurred under the self-insured portion of any medical plan maintained by
any ICCE Entity.
-23-
(e) The Assets of the ICCE Entities include all Assets required to
operate the business of the ICCE Entities as presently conducted.
5.9 INTELLECTUAL PROPERTY. Each ICCE Entity owns or has a license to use
---------------------
all of the Intellectual Property used by such ICCE Entity in the course of its
business. Each ICCE Entity is the owner of or has a license to any Intellectual
Property sold or licensed to a third party by such ICCE Entity in connection
with such ICCE Entity's business operations, and such ICCE Entity has the right
to convey by sale or license any Intellectual Property so conveyed. No ICCE
Entity is in Default under any of its Intellectual Property licenses. No
proceedings have been instituted, or are pending or to the Knowledge of ICCE
threatened, which challenge the rights of any ICCE Entity with respect to
Intellectual Property used, sold or licensed by such ICCE Entity in the course
of its business, nor has any person claimed or alleged any rights to such
Intellectual Property. To the Knowledge of ICCE, the conduct of the business of
the ICCE Entities does not infringe any Intellectual Property of any other
person. Except as disclosed in Section 5.9 of the ICCE Disclosure Memorandum,
no ICCE Entity is obligated to pay any recurring royalties to any Person with
respect to any such Intellectual Property. Except as disclosed in Section 5.9
of the ICCE Disclosure Memorandum, all rights to Intellectual Property developed
by or for any ICCE Entity are owned solely by the ICCE Entities and have either
been produced by employees of the ICCE Entities as works for hire under Federal
copyright law or have been assigned to the ICCE Entities in enforceable
technology transfer agreements.
5.10 ENVIRONMENTAL MATTERS.
---------------------
(a) To the Knowledge of ICCE, each ICCE Entity, its Participation
Facilities, and its Operating Properties are, and have been, in compliance with
all Environmental Laws, except for violations which are not reasonably likely to
have, individually or in the aggregate, an ICCE Material Adverse Effect.
(b) To the Knowledge of ICCE, there is no Litigation pending (in
which an ICCE Entity has received process or otherwise has Knowledge of the
existence thereof) or threatened before any court, governmental agency, or
authority or other forum in which any ICCE Entity or any of its Operating
Properties or Participation Facilities (or ICCE in respect of such Operating
Property or Participation Facility) has been or, with respect to threatened
Litigation, may be named as a defendant (i) for alleged noncompliance (including
by any predecessor) with any Environmental Law or (ii) relating to the release,
discharge, spillage, or disposal into the environment of any Hazardous Material,
whether or not occurring at, on, under, adjacent to, or affecting (or
potentially affecting) a site owned, leased, or operated by any ICCE Entity or
any of its Operating Properties or Participation Facilities, except for such
Litigation pending or threatened that is not reasonably likely to have,
individually or in the aggregate, an ICCE Material Adverse Effect, nor to the
Knowledge of ICCE is there any reasonable basis for any Litigation of a type
described in this sentence, except such as is not reasonably likely to have,
individually or in the aggregate, an ICCE Material Adverse Effect.
(c) To the Knowledge of ICCE, there have been no releases,
discharges, spillages, or disposals of Hazardous Material in, on, under,
adjacent to, or affecting (or
-24-
potentially affecting) such properties, except such as are not reasonably likely
to have, individually or in the aggregate, an ICCE Material Adverse Effect.
5.11 COMPLIANCE WITH LAWS. Each ICCE Entity has in effect all Permits
--------------------
necessary for it to own, lease or operate its material Assets and to carry on
its business as now conducted, except for those Permits the absence of which are
not reasonably likely to have, individually or in the aggregate, an ICCE
Material Adverse Effect, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, an ICCE Material Adverse Effect. Except as
disclosed in Section 5.11 of the ICCE Disclosure Memorandum, none of the ICCE
Entities:
(a) is in Default under its Articles of Incorporation or Bylaws (or
other governing instruments); or
(b) is in Default under any Laws, Orders or Permits applicable to its
business or employees conducting its business (including the Immigration
Reform and Control Act of 1986, as amended, and all applicable regulations
promulgated thereunder and Laws requiring the licensing of temporary employee
staffing companies or otherwise subjecting temporary employee staffing
companies to regulation), except for Defaults which are not reasonably likely
to have, individually or in the aggregate, an ICCE Material Adverse Effect;
or
(c) since January 1, 1993, has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting
that any ICCE Entity is not in compliance with any of the Laws or Orders
which such governmental authority or Regulatory Authority enforces, (ii)
threatening to revoke any Permits, the revocation of which is reasonably
likely to have, individually or in the aggregate, an ICCE Material Adverse
Effect, or (iii) requiring any ICCE Entity to enter into or consent to the
issuance of a cease and desist order, formal agreement, directive, commitment
or memorandum of understanding, or to adopt any Board resolution or similar
undertaking, which restricts materially the conduct of its business.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action against any ICCE Entity by a Regulatory Authority have been
made available to ACSYS.
5.12 LEGAL PROCEEDINGS. There is no Litigation instituted or pending
-----------------
(in which an ICCE Entity has received process or otherwise has Knowledge of the
existence thereof), or, to the Knowledge of ICCE, threatened against any ICCE
Entity, or against any director or employee benefit plan of any ICCE Entity, or
against any Asset, interest, or right of any of them, that is reasonably likely
to have, individually or in the aggregate, an ICCE Material Adverse Effect, nor
are there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against any ICCE Entity, that are
reasonably likely to have, individually or in the aggregate, an ICCE Material
Adverse Effect. Section 5.12 of the ICCE Disclosure Memorandum contains a
summary of all Litigation as of the date of this Agreement to which any ICCE
Entity is
-25-
a party and which names a ICCE Entity as a defendant or cross-defendant or for
which any ICCE Entity has any potential Liability (other than Liability for the
fees and expenses of its own counsel).
5.13 LABOR AND EMPLOYMENT MATTERS. No ICCE Entity is the subject of any
----------------------------
Litigation asserting that it or any other ICCE Entity has committed an unfair
labor practice (within the meaning of the National Labor Relations Act or
comparable state law) or seeking to compel it or any other ICCE Entity to
bargain with any labor organization as to wages or conditions of employment, nor
is any ICCE Entity party to any collective bargaining agreement, nor is there
any strike or other labor dispute involving any ICCE Entity, pending or
threatened, or to the Knowledge of ICCE, is there any activity involving any
ICCE Entity's employees seeking to certify a collective bargaining unit or
engaging in any other organization activity.
5.14 EMPLOYEE BENEFIT PLANS.
----------------------
(a) ICCE has disclosed in Section 5.14 of the ICCE Disclosure
Memorandum or has delivered or made available to ACSYS prior to the execution of
this Agreement, copies in each case of, all pension, retirement, profit-sharing,
deferred compensation, stock option, employee stock ownership, severance pay,
vacation, bonus, or other incentive plans, all other written employee programs,
arrangements, or agreements, all medical, vision, dental, or other health plans,
all life insurance plans, and all other employee benefit plans or fringe benefit
plans, including "employee benefit plans" as that term is defined in Section
3(3) of ERISA, currently adopted, maintained by, sponsored in whole or in part
by, or contributed to by any ICCE Entity or ERISA Affiliate thereof for the
benefit of employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries and under which employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
are eligible to participate (collectively, the "ICCE Benefit Plans"). Any of
the ICCE Benefit Plans which is an "employee pension benefit plan," as that term
is defined in Section 3(2) of ERISA, is referred to herein as a "ICCE ERISA
Plan." Each ICCE ERISA Plan which is also a "defined benefit plan" (as defined
in Section 414(j) of the Internal Revenue Code) is referred to herein as a "ICCE
Pension Plan." No ICCE Pension Plan is or has been a multiemployer plan within
the meaning of Section 3(37) of ERISA.
(b) All ICCE Benefit Plans are in substantial compliance with the
applicable terms of ERISA, the Internal Revenue Code, and any other applicable
Laws so that any breach or violation of such laws would not be reasonably likely
to have, individually or in the aggregate, an ICCE Material Adverse Effect.
Each ICCE ERISA Plan which is intended to be qualified under Section 401(a) of
the Internal Revenue Code has received a favorable determination letter from the
Internal Revenue Service, and ICCE is not aware of any circumstances likely to
result in revocation of any such favorable determination letter. No ICCE Entity
has engaged in a transaction with respect to any ICCE Benefit Plan that,
assuming the taxable period of such transaction expired as of the date hereof,
would subject any ICCE Entity to a Tax imposed by either Section 4975 of the
Internal Revenue Code or Section 502(i) of ERISA.
-26-
(c) No ICCE Pension Plan has any "unfunded current liability," as
that term is defined in Section 302(d)(8)(A) of ERISA, and the fair market value
of the assets of any such plan exceeds the plan's "benefit liabilities," as that
term is defined in Section 4001(a)(16) of ERISA, when determined under actuarial
factors that would apply if the plan terminated in accordance with all
applicable legal requirements. Since the date of the most recent actuarial
valuation, there has been (i) no material change in the financial position of
any ICCE Pension Plan, (ii) no change in the actuarial assumptions with respect
to any ICCE Pension Plan, and (iii) no increase in benefits under any ICCE
Pension Plan as a result of plan amendments or changes in applicable Law which
is reasonably likely to have, individually or in the aggregate, an ICCE Material
Adverse Effect or materially adversely affect the funding status of any such
plan. Neither any ICCE Pension Plan nor any "single-employer plan," within the
meaning of Section 4001(a)(15) of ERISA, currently or formerly maintained by any
ICCE Entity, or the single-employer plan of any ERISA Affiliate has an
"accumulated funding deficiency" within the meaning of Section 412 of the
Internal Revenue Code or Section 302 of ERISA. No ICCE Entity has provided, or
is required to provide, security to an ICCE Pension Plan or to any single-
employer plan of an ERISA Affiliate pursuant to Section 401(a)(29) of the
Internal Revenue Code.
(d) No Liability under Subtitle C or D of Title IV of ERISA has been
or is expected to be incurred by any ICCE Entity with respect to any ongoing,
frozen, or terminated single-employer plan or the single-employer plan of any
ERISA Affiliate. No ICCE Entity has incurred any withdrawal Liability with
respect to a multiemployer plan under Subtitle B of Title IV of ERISA
(regardless of whether based on contributions of an ERISA Affiliate). No notice
of a "reportable event," within the meaning of Section 4043 of ERISA for which
the 30-day reporting requirement has not been waived, has been required to be
filed for any ICCE Pension Plan or by any ERISA Affiliate within the 12-month
period ending on the date hereof.
(e) Except as disclosed in Section 5.14 of the ICCE Disclosure
Memorandum, no ICCE Entity has any Liability for retiree health and life
benefits under any of the ICCE Benefit Plans and there are no restrictions on
the rights of such ICCE Entity to amend or terminate any such retiree health or
benefit Plan without incurring any Liability thereunder.
(f) The actuarial present values of all accrued deferred
compensation entitlements (including entitlements under any executive
compensation, supplemental retirement, or employment agreement) of employees and
former employees of any ICCE Entity and their respective beneficiaries, other
than entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of ERISA,
have been fully reflected on the ICCE Financial Statements to the extent
required by and in accordance with GAAP.
(g) Except as disclosed in Section 5.14 of the ICCE Disclosure
Memorandum, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of any ICCE Entity from
any ICCE Entity under any ICCE Benefit Plan or otherwise, (ii) increase
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any benefits otherwise payable under any ICCE Benefit Plan, or (iii) result in
any acceleration of the time of payment or vesting of any such benefit.
5.15 STATEMENTS TRUE AND CORRECT. No statement, certificate, instrument
---------------------------
or other writing furnished or to be furnished by any ICCE Entity or any
Affiliate thereof to ACSYS pursuant to this Agreement or any other document,
agreement or instrument referred to herein contains or will contain any untrue
statement of material fact or will omit to state a material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. All documents that any ICCE Entity or any Affiliate
thereof is responsible for filing with any Regulatory Authority in connection
with the transactions contemplated hereby will comply as to form in all material
respects with the provisions of applicable Law.
5.16 AUTHORITY OF SUB. Sub is a corporation duly organized, validly
----------------
existing and in good standing under the Laws of the Commonwealth of Pennsylvania
as a wholly owned Subsidiary of ICCE. The authorized capital stock of Sub
consists of 1,000 shares of Sub Common Stock, all of which is validly issued and
outstanding, fully paid and nonassessable and is owned by ICCE. Sub has the
corporate power and authority necessary to execute, deliver and perform its
obligations under this Agreement and to consummate the transactions contemplated
hereby. The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein, including the Merger, have
been duly and validly authorized by all necessary corporate action in respect
thereof on the part of Sub. This Agreement represents a legal, valid, and
binding obligation of Sub, enforceable against Sub in accordance with its terms
(except in all cases as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, or similar Laws affecting
the enforcement of creditors' rights generally and except that the availability
of the equitable remedy of specific performance or injunctive relief is subject
to the discretion of the court before which any proceeding may be brought). The
execution of this Agreement by ICCE represents the written consent by ICCE, as
the sole shareholder of Sub, to approval of this Agreement by the shareholders
of Sub without a meeting pursuant to Section 1766(a) of the PBCL.
5.17 ACCOUNTING, TAX AND REGULATORY MATTERS. No ICCE Entity or any
--------------------------------------
Affiliate thereof has taken or agreed to take any action or has any Knowledge of
any fact or circumstance that is reasonably likely to (i) prevent the Merger
from qualifying for pooling-of-interests accounting treatment or as a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, or (ii) materially impede or delay receipt of any Consents of Regulatory
Authorities referred to in Section 7.1(a) or result in the imposition of a
condition or restriction of the type referred to in the last sentence of such
Section.
5.18 MATERIAL CONTRACTS. Except as disclosed in Section 5.18 of the
------------------
ICCE Disclosure Memorandum, none of the ICCE Entities, nor any of their
respective Assets, businesses, or operations, is a party to, or is bound or
affected by, or receives benefits under, (i) any employment, severance,
termination, consulting, or retirement Contract providing for aggregate payments
to any Person in any calendar year in excess of $50,000, (ii) any Contract
relating to the borrowing of money by any ICCE Entity or the guarantee by any
ICCE Entity of any such obligation (other than Contracts evidencing trade
payables and Contracts relating to
-28-
borrowings or guarantees made in the ordinary course of business), (iii) any
Contract which prohibits or restricts any ICCE Entity from engaging in any
business activities in any geographic area, line of business or otherwise in
competition with any other Person, (iv) any Contract involving Intellectual
Property (other than Contracts entered into in the ordinary course with
customers and "shrink-wrap" software licenses), (v) any Contract relating to the
provision of data processing, network communication, or other technical services
to any ICCE Entity, and (vi) any Contract relating to the purchase or sale of
any goods or the purchase of any services (other than Contracts entered into in
the ordinary course of business and involving payments under any individual
Contract not in excess of $50,000) (together with all Contracts referred to in
Sections 4.9 and 4.14(a), the "ICCE Contracts"). With respect to each ICCE
Contract and except as disclosed in Section 5.18 of the ICCE Disclosure
Memorandum: (i) the Contract is in full force and effect; (ii) no ICCE Entity is
in Default thereunder; (iii) no ICCE Entity has repudiated or waived any
material provision of any such Contract in any material respect; and (iv) no
other party to any such Contract is, to the Knowledge of ICCE, in Default in any
respect or has repudiated or waived any material provision thereunder. Except as
stated in Section 5.18 of the ICCE Disclosure Memorandum, all of the
indebtedness of any ICCE Entity for money borrowed is prepayable at any time by
such ICCE Entity without penalty or premium.
5.19 REPORTS. Since January 1, 1993, or the date of organization if
-------
later, each ICCE Entity has timely filed all reports and statements, together
with any amendments required to be made with respect thereto, that it was
required to file with Regulatory Authorities (except, in the case of state
securities authorities, failures to file which are not reasonably likely to
have, individually or in the aggregate, an ICCE Material Adverse Effect). As of
their respective dates, each of such reports and documents, including the
financial statements, exhibits, and schedules thereto, have been complied in all
material respects with all applicable Laws. As of its respective date, each
such report and document did not, in all material respects, contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
5.20 AUTHORITY OF ICCE SHAREHOLDERS; NO BREACH BY AGREEMENT.
------------------------------------------------------
(a) Each of the ICCE Shareholders has the absolute and unrestricted
right, power, authority, and capacity to execute and deliver this Agreement and
each of the Ancillary Agreements to which such ICCE Shareholder is party and to
perform its obligations under this Agreement and such Ancillary Agreements.
This Agreement represents a legal, valid, and binding obligation of each ICCE
Shareholder, enforceable against each ICCE Shareholder in accordance with its
terms (except in all cases as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, receivership, conservatorship,
moratorium, or similar Laws affecting the enforcement of creditors' rights
generally and except that the availability of the equitable remedy of specific
performance or injunctive relief is subject to the discretion of the court
before which any proceeding may be brought). Upon the execution and delivery by
the ICCE Shareholders of the Ancillary Agreements, the Ancillary Agreements will
constitute the legal, valid, and binding obligations of each ICCE Shareholder,
enforceable against each ICCE Shareholder in accordance with their respective
terms.
-29-
(b) Neither the execution and delivery of this Agreement by any ICCE
Shareholder, nor the consummation by any ICCE Shareholder of the transactions
contemplated hereby, nor compliance by any ICCE Shareholder with any of the
provisions hereof, will (i) conflict with or result in a breach of any provision
of ICCE's Certificate of Incorporation or Bylaws or the certificate or articles
of incorporation or bylaws of any ICCE Subsidiary or the governing instruments
of any ICCE Shareholder that is not a natural person, or (ii) except as
disclosed in Section 5.19 of the ICCE Disclosure Memorandum, constitute or
result in a Default under, or require any Consent pursuant to, or result in the
creation of any Lien on any Asset of any ICCE Entity under, any Contract or
Permit of any ICCE Entity other than those which are not reasonably likely to
have, individually or in the aggregate, an ICCE Material Adverse Effect, or,
(iii) subject to receipt of the requisite Consents referred to in Section
7.1(a), violate any Law or Order applicable to any ICCE Shareholder or to any
ICCE Entity or any of their respective material Assets.
(c) Other than in connection or compliance with the provisions of the
Securities Laws, and applicable state corporate and securities Laws, and other
than Consents required from Regulatory Authorities, and other than notices to or
filings with the Internal Revenue Service or the Pension Benefit Guaranty
Corporation with respect to any employee benefit plans, or under the HSR Act, no
notice to, filing with, or Consent of, any public body or authority is necessary
for the consummation by the ICCE Shareholders of the transactions contemplated
in this Agreement.
ARTICLE 6
CERTAIN AGREEMENTS
------------------
6.1 FILINGS WITH STATE OFFICES. Upon the terms and subject to the
--------------------------
conditions of this Agreement, ACSYS and Sub shall execute and file the
Certificate of Merger with the Secretary of State of the Commonwealth of
Pennsylvania in connection with the Closing.
6.2 CERTAIN TAX RETURNS OF ACSYS. For income tax purposes, (i) ACSYS's
----------------------------
final S corporation Tax year will end at the close of the day before the day on
which occurs the Effective Time, and (ii) a new Tax year for ACSYS will begin on
the day on which the Effective Time occurs. The ACSYS Shareholders shall
prepare and cause to be filed all income Tax Returns of ACSYS (including IRS
Form 1120S and Schedule K-1(1120S) and similar state Tax Returns) for the Tax
year ending on the day before the day on which the Effective Time occurs, as
well as for all prior Tax years (if not filed before the Effective Time). ICCE
agrees to cooperate (and to cause ACSYS to cooperate) with the ACSYS
Shareholders to the extent reasonably required after the Effective Time in
connection with (i) the preparation, execution, and filing of all such Tax
Returns and other Tax documents with respect to ACSYS's final Tax year as an S
corporation and any prior Tax year of ACSYS, (ii) contests concerning the
application of any Tax or the amount of Tax due for any such Tax year, and (iii)
audits and other proceedings conducted by any taxing authority with respect to
any such Tax period. All income Tax Returns of ACSYS filed after the Effective
Time for Tax years beginning before the
-30-
Effective Time shall be based on the same accounting methods and elections as
used for ACSYS's Tax year immediately preceding the period of such Tax Return,
except as otherwise agreed upon by ICCE and the ACSYS Shareholders.
6.3 ACSYS SHAREHOLDER RELEASES. Except as set forth in Section 6.3 of
--------------------------
the ACSYS Disclosure Memorandum, each ACSYS Shareholder hereby releases,
remises, and forever discharges each ACSYS Entity and their respective
Representatives, Affiliates, and insurers, and their respective successors and
assigns, and each of them (hereinafter individually and collectively, the
"Releasees") of and from any and all claims, demands, debts, accounts,
covenants, agreements, obligations, costs, expenses, actions or causes of action
of every nature, character or description, now accrued or which may hereafter
accrue, without limitation of law, equity or otherwise, based in whole or in
part on any facts, conduct, activities, transactions, events or occurrences
known or unknown, which have or allegedly have existed, occurred, happened,
arisen or transpired from the beginning of time to the Effective Time (the
"Released Claims"). Each ACSYS Shareholder represents and warrants that no
Released Claim released herein has been assigned, expressly, impliedly, or by
operation of Law, and that all Released Claims of such ACSYS Shareholder
released herein are owned by such ACSYS Shareholder, who has the sole authority
to release them. Each ACSYS Shareholder agrees that such holder shall forever
refrain and forebear from commencing, instituting or prosecuting any lawsuit
action or proceeding, judicial, administrative, or otherwise, or otherwise
attempting to collect or enforce any Released Claims which are released and
discharged herein.
6.4 ACCOUNTING AND TAX TREATMENT. Each of the Parties undertakes and
----------------------------
agrees to use its reasonable efforts to cause the Merger, and to take no action
which would cause the Merger not, to qualify for treatment as a pooling of
interests for accounting purposes or as a "reorganization" within the meaning of
Section 368(a) of the Internal Revenue Code for federal income tax purposes.
ARTICLE 7
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
-------------------------------------------------
7.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective obligations
---------------------------------------
of each Party to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by both Parties pursuant to Section 10.6:
(A) REGULATORY APPROVALS. All Consents of, filings and
--------------------
registrations with, and notifications to, all Regulatory Authorities required
for consummation of the Merger shall have been obtained or made and shall be
in full force and effect and all waiting periods required by Law shall have
expired. No Consent obtained from any Regulatory Authority which is necessary
to consummate the transactions contemplated hereby shall be conditioned or
restricted in a manner (including requirements relating to the raising of
additional capital or the disposition of Assets) which in the reasonable
judgment of the Board of Directors of either ICCE or ACSYS would so
materially adversely impact the
-31-
economic or business benefits of the transactions contemplated by this
Agreement that, had such condition or requirement been known, ICCE or ACSYS
would not, in its reasonable judgment, have entered into this Agreement.
(B) CONSENTS AND APPROVALS. Each Party shall have obtained any and
----------------------
all Consents required for consummation of the Merger (other than those
referred to in Section 7.1(a)) or for the preventing of any Default under any
Contract or Permit of such Party which, if not obtained or made, is
reasonably likely to have, individually or in the aggregate, an ACSYS
Material Adverse Effect or an ICCE Material Adverse Effect, as applicable.
No Consent so obtained which is necessary to consummate the transactions
contemplated hereby shall be conditioned or restricted in a manner which in
the reasonable judgment of the Board of Directors of either ICCE or ACSYS
would so materially adversely impact the economic or business benefits of the
transactions contemplated by this Agreement that, had such condition or
requirement been known, ICCE or ACSYS would not, in its reasonable judgment,
have entered into this Agreement.
(C) LEGAL PROCEEDINGS. No court or governmental or Regulatory
-----------------
Authority of competent jurisdiction shall have enacted, issued, promulgated,
enforced or entered any Law or Order (whether temporary, preliminary or
permanent) or taken any other action which prohibits, restricts or makes
illegal the consummation of the transactions contemplated by this Agreement.
(D) REGISTRATION RIGHTS. ICCE and each of the ACSYS Shareholders
-------------------
shall have executed and delivered a counterpart of the Amended and Restated
Registration Rights Agreement to which all existing shareholders of ICCE are
party, in the form attached hereto as Exhibit 2 (the "Registration Rights
Agreement").
(E) EMPLOYMENT AGREEMENTS. ICCE and each of the ACSYS Shareholders
---------------------
(other than ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇) shall have
executed and delivered to ICCE an employment agreement in substantially the
form of Exhibit 3 (collectively, the "Employment Agreements").
(F) NON-SOLICITATION AND NON-COMPETITION AGREEMENTS. Each of the
-----------------------------------------------
ACSYS Shareholders (other than ▇▇▇▇▇▇ ▇▇▇▇▇▇▇) shall have executed and
delivered to ICCE a non-solicitation and non-competition agreement in
substantially the form of Exhibit 4 (collectively, the "Non-Solicitation
Agreements").
(G) POOLING LETTERS. Each of the Parties shall have received one
---------------
or more letters, dated as of the Effective Time, addressed to the Parties, in
form and substance reasonably acceptable to the Parties, from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP to the effect that the Merger will qualify for pooling-of-interests
accounting treatment.
7.2 CONDITIONS TO OBLIGATIONS OF ICCE. The obligations of ICCE to
---------------------------------
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are
-32-
subject to the satisfaction of the following conditions, unless waived by ICCE
pursuant to Section 10.6(a):
(A) REPRESENTATIONS AND WARRANTIES. The representations and
------------------------------
warranties set forth in Section 4.4 shall be true and correct (except for
inaccuracies which are de minimus in amount). The representations and
warranties set forth in Section 4.19 shall be true and correct in all
material respects. There shall not exist inaccuracies in the representations
and warranties of ACSYS and the ACSYS Shareholders set forth in this
Agreement (including the representations and warranties set forth in Sections
4.4 and 4.19) such that the aggregate effect of such inaccuracies has, or is
reasonably likely to have, an ACSYS Material Adverse Effect; provided that,
for purposes of this sentence only, those representations and warranties
which are qualified by references to "material" or "Material Adverse Effect"
or to the "Knowledge" of any Person shall be deemed not to include such
qualifications.
(B) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of the
---------------------------------------
agreements and covenants of ACSYS and the ACSYS Shareholders to be performed
and complied with pursuant to this Agreement and the other agreements
contemplated hereby prior to the Effective Time shall have been duly
performed and complied with in all material respects.
(C) CERTIFICATES. ACSYS shall have delivered to ICCE certified
------------
copies of resolutions duly adopted by ACSYS's Board of Directors and
shareholders evidencing the taking of all corporate action necessary to
authorize the execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated hereby, all in such reasonable
detail as ICCE and its counsel shall request.
(D) OPINION OF COUNSEL. ICCE shall have received an opinion of
------------------
▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP, counsel to ACSYS and the ACSYS Shareholders,
dated as of the Closing, in form reasonably satisfactory to ICCE, as to the
matters set forth in Exhibit 5.
(E) STOCK OPTIONS. The compensation or other relevant committee of
-------------
ACSYS's Board of Directors shall have taken, or caused to be taken, all
actions, and to do, or cause to be done, all things necessary, proper, or
advisable on behalf of ACSYS to effect the conversion of all ACSYS Options
into rights with respect to ICCE Common Stock, as contemplated by Section 3.7
hereof, without any other change in the terms of the ACSYS Options (other
than changes contemplated by Section 3.7).
7.3 CONDITIONS TO OBLIGATIONS OF ACSYS AND THE ACSYS SHAREHOLDERS. The
-------------------------------------------------------------
obligations of ACSYS and the ACSYS Shareholders to perform this Agreement and
consummate the Merger and the other transactions contemplated hereby are subject
to the satisfaction of the following conditions, unless waived by ACSYS pursuant
to Section 10.6(b):
(A) REPRESENTATIONS AND WARRANTIES. The representations and
------------------------------
warranties set forth in Section 5.3 shall be true and correct (except for
inaccuracies which are de minimus in amount). The representations and
warranties of ICCE set forth in Section 5.17 shall be
-33-
true and correct in all material respects. There shall not exist inaccuracies
in the representations and warranties of ICCE set forth in this Agreement
(including the representations and warranties set forth in Section 5.17) such
that the aggregate effect of such inaccuracies has, or is reasonably likely
to have, an ICCE Material Adverse Effect; provided that, for purposes of this
sentence only, those representations and warranties which are qualified by
references to "material" or "Material Adverse Effect" or to the "Knowledge"
of any Person shall be deemed not to include such qualifications.
(B) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of the
---------------------------------------
agreements and covenants of ICCE to be performed and complied with pursuant
to this Agreement and the other agreements contemplated hereby prior to the
Effective Time shall have been duly performed and complied with in all
material respects.
(C) CERTIFICATES. ICCE shall have delivered to ACSYS certified
------------
copies of resolutions duly adopted by ICCE's Board of Directors and Sub's
Board of Directors and sole shareholder evidencing the taking of all
corporate action necessary to authorize the execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as ACSYS and its counsel
shall request.
(D) OPINION OF COUNSEL. ACSYS shall have received an opinion of
------------------
▇▇▇▇▇▇ & Bird LLP, counsel to ICCE, dated as of the Effective Time, in form
reasonably acceptable to ACSYS, as to the matters set forth in Exhibit 6.
(E) STOCK OPTIONS. The compensation or other relevant committee of
-------------
ICCE's Board of Directors shall have taken, or caused to be taken, all
actions, and to do, or cause to be done, all things necessary, proper or
advisable on behalf of ICCE to effect the conversion of all ACSYS Options
into rights with respect to ICCE Common Stock, as contemplated by Section 3.7
hereof, without any other change in the terms of the ACSYS Options (other
than changes contemplated by Section 3.7 hereof).
ARTICLE 8
INDEMNIFICATION
---------------
8.1 AGREEMENT OF INDEMNITORS TO INDEMNIFY.
-------------------------------------
(a) Subject to the terms and conditions of this Article 8, the
ACSYS Shareholders severally (in proportion to their respective ownership of
shares of ICCE Common Stock issued in the Merger to ACSYS Shareholders), not
jointly, agree to indemnify, defend, and hold harmless ICCE from, against, for
and in respect of any and all Losses asserted against, or paid, suffered or
incurred by, ICCE or any of its Subsidiaries and resulting from, based upon, or
arising out of:
-34-
(i) the inaccuracy, untruth, incompleteness or breach of any
representation or warranty of any ACSYS Shareholder or ACSYS contained in or
made pursuant to this Agreement or in any certificate, Schedule, or Exhibit
furnished by ACSYS or any ACSYS Shareholder in connection herewith and for
purposes of this Section 8.1(a) any qualification of such representations and
warranties by reference to the materiality of matters stated therein or as to
matters having or not having a "Material Adverse Effect" shall be disregarded
in determining any inaccuracy, untruth, incompleteness or breach thereof; and
(ii) a breach of or failure to perform any covenant or
agreement of the ACSYS Shareholders or ACSYS made in this Agreement.
(b) Subject to the terms and conditions of this Article 8, ICCE
agrees to indemnify, defend, and hold harmless the ACSYS Shareholders from,
against, for and in respect of any and all Losses asserted against, or paid,
suffered or incurred by, a ACSYS Shareholder and resulting from, based upon, or
arising out of:
(i) the inaccuracy, untruth, incompleteness or breach of any
representation or warranty of ICCE contained in or made pursuant to this
Agreement or in any certificate, Schedule, or Exhibit furnished by ICCE in
connection herewith and for purposes of this Section 8.1(b) any qualification
of such representations and warranties by reference to the materiality of
matters stated therein or as to matters having or not having a "Material
Adverse Effect" shall be disregarded in determining any inaccuracy, untruth,
incompleteness or breach thereof; and
(ii) a breach of or failure to perform any covenant or
agreement of ICCE made in this Agreement.
(c) Subject to the terms and conditions of this Article 8, the ICCE
Shareholders severally (in proportion to their respective ownership of shares of
ICCE Common Stock held as of the date hereof by ICCE Shareholders), not jointly,
agree to indemnify, defend, and hold harmless ICCE from, against, for and in
respect of any and all Losses asserted against, or paid, suffered or incurred
by, ICCE or any of its Subsidiaries and resulting from, based upon, or arising
out of:
(i) the inaccuracy, untruth, incompleteness or breach of any
representation or warranty of ICCE contained in or made pursuant to this
Agreement or in any certificate, Schedule, or Exhibit furnished by ICCE in
connection herewith and for purposes of this Section 8.1(c) any qualification
of such representations and warranties by reference to the materiality of
matters stated therein or as to matters having or not having a "Material
Adverse Effect" shall be disregarded in determining any inaccuracy, untruth,
incompleteness or breach thereof; and
(ii) a breach of or failure to perform any covenant or
agreement of ICCE made in this Agreement.
-35-
8.2 PROCEDURES FOR INDEMNIFICATION.
------------------------------
(a) An Indemnification Claim shall be made by an Indemnitee by
delivery of a written notice to the Indemnitor Representative (as defined in
Section 9.10 below) requesting indemnification and specifying the basis on which
indemnification is sought and the amount of asserted Losses and, in the case of
a Third Party Claim, containing (by attachment or otherwise) such other
information as such Indemnitee shall have concerning such Third Party Claim.
(b) If the Indemnification Claim involves a Third Party Claim the
procedures set forth in Section 8.3 shall be observed by the Indemnitee and the
Indemnitor Representative(s).
(c) If the Indemnification Claim involves a matter other than a
Third Party Claim, the Indemnitor Representative(s) shall have 30 days to object
to such Indemnification Claim by delivery of a written notice of such objection
to such Indemnitee specifying in reasonable detail the basis for such objection.
Failure to timely so object shall constitute a final and binding acceptance of
the Indemnification Claim by the Indemnitor Representative(s) on behalf of all
Indemnitors, and the Indemnification Claim shall be paid in accordance with
subsection (d) hereof.
(d) Upon determination of the amount of an Indemnification Claim,
whether by agreement between the Indemnitor Representative(s) and the Indemnitee
or by an arbitration award or by any other final adjudication, the Indemnitors
shall pay the amount of such Indemnification Claim within ten days of the date
such amount is determined. In the event that the ACSYS Shareholders are the
Indemnitors that are required to pay an Indemnification Claim, if the ACSYS
Shareholders beneficially own shares of ICCE Common Stock as of such date, the
ACSYS Shareholders shall, if so required by ICCE, pay the amount of such
Indemnification Claim by surrender to ICCE of such number of shares of ICCE
Common Stock as shall equal the quotient obtained by dividing the amount of such
Indemnification Claim by the amount set forth in Section 8.2 of the ICCE
Disclosure Memorandum; provided, that if the ACSYS Shareholders do not
beneficially own a sufficient number of shares of ICCE Common Stock to pay in
full the amount of such Indemnification Claim by surrender of such shares as
provided in the preceding clause of this sentence, the ACSYS Shareholders shall
surrender to ICCE such number of shares of ICCE Common Stock as such ACSYS
Shareholders beneficially own and shall pay any remaining balance of the
Indemnification Amount in cash.
8.3 THIRD PARTY CLAIMS. The obligations and liabilities of the parties
------------------
hereunder with respect to a Third Party Claim shall be subject to the following
terms and conditions:
(a) The Indemnitee shall give the Indemnitor Representative(s)
written notice of a Third Party Claim promptly after receipt by the
Indemnitee of notice thereof, and the Indemnitor Representative(s), on behalf
of the Indemnitors, may undertake the defense, compromise and settlement
thereof by representatives of its own choosing reasonably acceptable to the
Indemnitee. The failure of the Indemnitee to notify the Indemnitor
Representative(s) of such claim shall not relieve the Indemnitors of any
liability that they
-36-
may have with respect to such claim except to the extent the Indemnitor
Representative(s) demonstrates that the defense of such claim is prejudiced
by such failure. The assumption of the defense, compromise and settlement of
any such Third Party Claim by the Indemnitor Representative(s) shall be an
acknowledgment of the obligation of the Indemnitors to indemnify the
Indemnitee with respect to such claim hereunder unless the Indemnitors
provide notice otherwise at the time such defense is assumed. If the
Indemnitee desires to participate in, but not control, any such defense,
compromise and settlement, it may do so at its sole cost and expense. If,
however, the Indemnitor Representative(s) fail or refuse to undertake the
defense of such Third Party Claim within ten (10) days after written notice
of such claim has been given to the Indemnitor Representative(s) by the
Indemnitee, the Indemnitee shall have the right to undertake the defense,
compromise and settlement of such claim with counsel of its own choosing. In
the circumstances described in the preceding sentence, the Indemnitee shall,
promptly upon its assumption of the defense of such claim, make an
Indemnification Claim as specified in Section 8.2 which shall be deemed an
Indemnification Claim that is not a Third Party Claim for the purposes of the
procedures set forth herein.
(b) If, in the reasonable opinion of the Indemnitee, any Third
Party Claim or the litigation or resolution thereof involves an issue or
matter which could have a material adverse effect on the business,
operations, assets, properties or prospects of the Indemnitee (including,
without limitation, the administration of the tax returns and
responsibilities under the tax laws of the Indemnitee), the Indemnitee shall
have the right to control the defense, compromise and settlement of such
Third Party Claim undertaken by the Indemnitor Representative(s), and the
costs and expenses of the Indemnitee in connection therewith shall be
included as part of the indemnification obligations of the Indemnitors
hereunder. If the Indemnitee shall elect to exercise such right, the
Indemnitor Representative(s) shall have the right to participate in, but not
control, the defense, compromise and settlement of such Third Party Claim at
its sole cost and expense.
(c) No settlement of a Third Party Claim involving the asserted
liability of the Indemnitors under this Article 8 shall be made without the
prior written consent by or on behalf of the Indemnitor Representative(s),
which consent shall not be unreasonably withheld or delayed. Consent shall
be presumed in the case of settlements of $20,000 or less where the
Indemnitor Representative(s) has not responded within five business days of
notice of a proposed settlement. If the Indemnitor Representative(s) assume
the defense of such a Third Party Claim, (a) no compromise or settlement
thereof may be effected by the Indemnitor Representative(s) without the
Indemnitee's consent unless (i) there is no finding or admission of any
violation of law or any violation of the rights of any person and no effect
on any other claim that may be made against the Indemnitee, (ii) the sole
relief provided is monetary damages that are paid in full by the Indemnitors,
and (iii) the compromise or settlement includes, as an unconditional term
thereof, the giving by the claimant or the plaintiff to the Indemnitee of a
release, in form and substance satisfactory to the Indemnitee, from all
liability in respect of such Third Party Claim, and (b) the Indemnitee shall
have no liability with respect to any compromise or settlement thereof
effected without its consent.
-37-
(d) In connection with the defense, compromise or settlement of any
Third Party Claim, the parties to this Agreement shall execute such powers of
attorney as may reasonably be necessary or appropriate to permit
participation of counsel selected by any party hereto and, as may reasonably
be related to any such claim or action, shall provide access to the counsel,
accountants and other representatives of each party during normal business
hours to all properties, personnel, books, tax records, contracts,
commitments and all other business records of such other party and will
furnish to such other party copies of all such documents as may reasonably be
requested (certified, if requested).
8.4 INDEMNIFICATION EXCLUSIVE REMEDY. If the Closing occurs, the
--------------------------------
indemnification provided in this Article 8 and in the Escrow Agreement shall
(except as prohibited by ERISA) be the exclusive remedy in any action seeking
damages or any other form of monetary relief brought by any party to this
Agreement against any other party, provided that, nothing herein shall be
construed to limit the right of a party, in a proper case, to seek injunctive
relief for a breach of this Agreement.
8.5 SURVIVAL. All representations, warranties and agreements of ACSYS
--------
and the ACSYS Shareholders and ICCE contained in this Agreement or in any
certificate delivered pursuant to this Agreement shall survive the Closing
notwithstanding any investigation conducted with respect thereto or any
knowledge acquired as to the accuracy or inaccuracy of any such representation
or warranty.
8.6 TIME LIMITATIONS. The Indemnitors will have no liability to the
----------------
Indemnitees under or in connection with a breach of any of the representations,
warranties, covenants or agreements made or to be performed by the Indemnitors
contained in this Agreement unless written notice asserting an Indemnification
Claim based thereon is given to the Indemnitor Representative(s) prior to the
earlier of (i) 15 days following the issuance of post-Merger audited financial
statements for ICCE and its subsidiaries on a consolidated basis which cover at
least 30 days of post-Merger operations, and (ii) the first anniversary of the
Closing Date.
8.7 LIMITATIONS AS TO AMOUNT. Indemnitors shall have no liability with
------------------------
respect to the matters described in Section 8.1 until the total of all Losses
with respect thereto exceeds $100,000 and then only for the amount by which such
Losses exceeds $100,000 with respect to the relevant class of Indemnitors. The
limitations set forth in this Section shall not apply to any intentional
misrepresentation or breach of warranty of any Indemnitor or any intentional
failure to perform or comply with any covenant or agreement of any Indemnitor,
and the Indemnitors shall be liable for all Losses with respect thereto.
Notwithstanding any other term of this Agreement (except the proviso to this
sentence), no ACSYS Shareholder shall be liable under this Article 8 for an
amount which exceeds the fair market value (at the time when the amount of
liability is determined) of the ICCE Common Stock received by such ACSYS
Shareholder in connection with the Merger, provided that a ACSYS Shareholder's
indemnification obligations pursuant to Section 8.1(a)(i) with respect to the
representations and warranties made in Section 4.8 shall not be so limited.
Notwithstanding any other term of this Agreement (except the proviso to this
sentence), no ICCE Shareholder shall be liable under this Article 8 for an
amount
-38-
which exceeds the fair market value (at the time when the amount of liability is
determined) of the ICCE Common Stock beneficially owned by such ICCE Shareholder
as of the date hereof, provided that an ICCE Shareholder's indemnification
obligations pursuant to Section 8.1(c)(i) with respect to the representations
and warranties made in Section 5.7 shall not be so limited, and ICCE shall not
be liable under this Article 8 for any amounts which exceed the aggregate
limitation on the liability of all ICCE Shareholders as a group.
8.8 TAX EFFECT AND INSURANCE. The liability of the Indemnitors with
------------------------
respect to any Indemnification Claim shall be reduced by the tax benefit
actually realized and any insurance proceeds received by the Indemnitees as a
result of any Losses upon which such Indemnification Claim is based, and shall
include any tax detriment actually suffered by the Indemnitees as a result of
such Losses. The amount of any such tax benefit or detriment shall be
determined by taking into account the effect, if any and to the extent
determinable, of timing differences resulting from the acceleration or deferral
of items of gain or loss resulting from such Losses and shall otherwise be
determined so that payment by the Indemnitors of the Indemnification Claim, as
adjusted to give effect to any such tax benefit or detriment, will make the
Indemnitee as economically whole as is reasonably practical with respect to the
Losses upon which the Indemnification Claim is based.
8.9 ESCROW CLAIM. Upon notice to the Indemnitor Representative for the
------------
ACSYS Shareholders specifying in reasonable detail the basis therefor, ICCE may
give notice of an Escrow Claim under the Escrow Agreement. Neither the giving
of nor the failure to give such notice of an Escrow Claim under the Escrow
Agreement shall constitute an election of remedies nor limit ICCE in any manner
in the enforcement of any other remedies that may be available to it under this
Agreement or the Escrow Agreement.
8.10 SUBROGATION. Upon payment in full of any Indemnification Claim,
-----------
whether such payment is effected by set-off or otherwise, or the payment of any
judgment or settlement with respect to a Third Party Claim, the Indemnitors
shall be subrogated to the extent of such payment to the rights of the
Indemnitee against any person or entity with respect to the subject matter of
such Indemnification Claim or Third Party Claim.
8.11 APPOINTMENT OF INDEMNITOR REPRESENTATIVES.
-----------------------------------------
(a) Each ACSYS Shareholder constitutes and appoints ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇ as his or her true and lawful attorney-in-fact to act for and on
behalf of such ACSYS Shareholder as Indemnitor Representative in all matters
relating to or arising out of this Article 8. Each Indemnitor Representative
shall act in all matters relating to or arising out of this Article 8 and the
Liability or asserted Liability of such Indemnitor hereunder, including
specifically, but without limitation, accepting and agreeing to the Liability of
such Indemnitor with respect to any Indemnification Claim, objecting to any
Indemnification Claim, disputing the Liability of such Indemnitor, or the amount
of such Liability, with respect to any Indemnification Claim and prosecuting and
resolving such dispute as herein provided, accepting the defense, compromise and
settlement of any Third Party Claim on behalf of such Indemnitor or refusing to
accept the same, settling and compromising the Liability of such Indemnitor
hereunder, instituting and
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prosecuting such actions (including arbitration proceedings) as such Indemnitor
Representative shall deem appropriate in connection with any of the foregoing,
retaining counsel, accountants, appraisers and other advisers in connection with
any of the foregoing, all for the account of each Indemnitor, each such
Indemnitor agreeing to be fully bound by the acts, decisions and agreements of
such Indemnitor Representative taken and done pursuant to the authority herein
granted. Each ACSYS Shareholder hereby agrees to indemnify and to save and hold
harmless such Indemnitor Representative from any Liability incurred by such
Indemnitor Representative based upon or arising out of any act, whether of
omission or commission, of such Indemnitor Representative pursuant to the
authority herein granted, other than acts, whether of omission or commission, of
such Indemnitor Representative that constitute gross negligence or willful
misconduct in the exercise by such Indemnitor Representative of the authority
herein granted.
(b) Each ICCE Shareholder constitutes and appoints each of ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, or either of them, as his or her true and lawful
attorney-in-fact to act for and on behalf of such ICCE Shareholder as Indemnitor
Representative in all matters relating to or arising out of this Article 8.
Each such Indemnitor Representative shall act in all matters relating to or
arising out of this Article 8 and the Liability or asserted Liability of such
Indemnitor hereunder, including specifically, but without limitation, accepting
and agreeing to the Liability of such Indemnitor with respect to any
Indemnification Claim, objecting to any Indemnification Claim, disputing the
Liability of such Indemnitor, or the amount of such Liability, with respect to
any Indemnification Claim and prosecuting and resolving such dispute as herein
provided, accepting the defense, compromise and settlement of any Third Party
Claim on behalf of such Indemnitor or refusing to accept the same, settling and
compromising the Liability of such Indemnitor hereunder, instituting and
prosecuting such actions (including arbitration proceedings) as each such
Indemnitor Representatives shall deem appropriate in connection with any of the
foregoing, retaining counsel, accountants, appraisers and other advisers in
connection with any of the foregoing, all for the account of each Indemnitor,
each such Indemnitor agreeing to be fully bound by the acts, decisions and
agreements of either such Indemnitor Representative taken and done pursuant to
the authority herein granted. Each ICCE Shareholder hereby agrees to indemnify
and to save and hold harmless each such Indemnitor Representative from any
Liability incurred by such Indemnitor Representative based upon or arising out
of any act, whether of omission or commission, of such Indemnitor Representative
pursuant to the authority herein granted, other than acts, whether of omission
or commission, of such Indemnitor Representative that constitute gross
negligence or willful misconduct in the exercise by such Indemnitor
Representative of the authority herein granted.
ARTICLE 9
TERMINATION
-----------
9.1 TERMINATION. Notwithstanding any other provision of this Agreement,
-----------
and notwithstanding the approval of this Agreement by the shareholders of ACSYS,
this Agreement may be terminated and the Merger abandoned at any time prior to
the Effective Time:
(a) By mutual consent of ICCE and ACSYS; or
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(b) By either Party, if the Effective Time has not occurred by 5:00
P.M. on the first business day following the date of this Agreement.
9.2 EFFECT OF TERMINATION. In the event of the termination and
---------------------
abandonment of this Agreement pursuant to Section 9.1, this Agreement shall
become void and have no effect, except that the provisions of this Section 9.2
and Article 10 shall survive any such termination and abandonment.
ARTICLE 10
MISCELLANEOUS
-------------
10.1 DEFINITIONS.
-----------
(a) Except as otherwise provided herein, the capitalized terms set
forth below shall have the following meanings:
"1933 ACT" shall mean the Securities Act of 1933, as amended.
"1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"AFFILIATE" of a Person shall mean: (i) any other Person directly,
or indirectly through one or more intermediaries, controlling, controlled by
or under common control with such Person; (ii) any officer, director,
partner, employer, or direct or indirect beneficial owner of any 10% or
greater equity or voting interest of such Person; or (iii) any other Person
for which a Person described in clause (ii) acts in any such capacity.
"AGREEMENT" shall mean this Agreement and Plan of Merger, including
the Exhibits delivered pursuant hereto and incorporated herein by reference.
"ANCILLARY AGREEMENTS" shall mean the Employment Agreements, the
Non-Solicitation Agreements, and the Registration Rights Agreement.
"ACSYS COMMON STOCK" shall mean the no par value common stock of
ACSYS.
"ACSYS DISCLOSURE MEMORANDUM" shall mean the written information
entitled "ACSYS Resources, Inc. Disclosure Memorandum" delivered prior to the
date of this Agreement to ICCE describing in reasonable detail the matters
contained therein and, with respect to each disclosure made therein,
specifically referencing each Section of this Agreement under which such
disclosure is being made. Information disclosed with respect to one Section
shall not be deemed to be disclosed for purposes of any other Section not
specifically referenced with respect thereto.
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"ACSYS ENTITIES" shall mean, collectively, ACSYS, all ACSYS
Subsidiaries and all predecessors thereto.
"ACSYS FINANCIAL STATEMENTS" shall mean (i) the balance sheets
(including related notes and schedules, if any) of ACSYS as of June 30, 1997,
and as of December 31, 1996 and 1995, the related statements of income for
the six months ended June 30, 1997, and for each of the three fiscal years
ended December 31, 1996, 1995 and 1994, and the related changes in
shareholders' equity and cash flows (including related notes and schedules,
if any) for each of the three fiscal years ended December 31, 1996, 1995 and
1994, and (ii) the balance sheets (including related notes and schedules, if
any) of CPA as of June 30, 1997, and as of December 31, 1996, the related
statements of income for the six months ended June 30, 1997, and for the
fiscal year ended December 31, 1996, and the related changes in shareholders'
equity and cash flows (including related notes and schedules, if any) for the
fiscal year ended December 31, 1996.
"ACSYS MATERIAL ADVERSE EFFECT" shall mean an event, change or
occurrence which, individually or together with any other event, change or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of ACSYS and its Subsidiaries, taken as a
whole, or (ii) the ability of ACSYS to perform its obligations under this
Agreement or to consummate the Merger or the other transactions contemplated
by this Agreement.
"ACSYS SUBSIDIARIES" shall mean the Subsidiaries of ACSYS, which
shall include the ACSYS Subsidiaries described in Section 4.1 and any
corporation or other organization acquired as a Subsidiary of ACSYS in the
future and held as a Subsidiary by ACSYS at the Effective Time.
"ASSETS" of a Person shall mean all of the assets, properties,
businesses and rights of such Person of every kind, nature, character and
description, whether real, personal or mixed, tangible or intangible, accrued
or contingent, or otherwise relating to or utilized in such Person's
business, directly or indirectly, in whole or in part, whether or not carried
on the books and records of such Person, and whether or not owned in the name
of such Person or any Affiliate of such Person and wherever located.
"CERTIFICATE OF MERGER" shall mean the Certificate of Merger to be
executed by ACSYS and Sub and filed with the Secretary of State of the
Commonwealth of Pennsylvania relating to the Merger as contemplated by
Section 1.1.
"CLOSING DATE" shall mean the date on which the Closing occurs.
"CONSENT" shall mean any consent, approval, authorization,
clearance, exemption, waiver, or similar affirmation by any Person pursuant
to any Contract, Law, Order, or Permit.
"CONTRACT" shall mean any written or oral agreement, arrangement,
authorization, commitment, contract, indenture, instrument, lease,
obligation, plan,
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practice, restriction, understanding, or undertaking of any kind or character,
or other document to which any Person is a party or that is binding on any
Person or its capital stock, Assets or business.
"CPA" shall mean Career Placement Associates, Inc., C.P.A. Staffing,
Inc., and C.P.A. Search, Inc. acquired by ACSYS as of August 12, 1997, with
the merger effective August 22, 1997.
"DEFAULT" shall mean (i) any breach or violation of, default under,
contravention of, or conflict with, any Contract, Law, Order, or Permit, (ii)
any occurrence of any event that with the passage of time or the giving of
notice or both would constitute a breach or violation of, default under,
contravention of, or conflict with, any Contract, Law, Order, or Permit, or
(iii) any occurrence of any event that with or without the passage of time or
the giving of notice would give rise to a right of any Person to exercise any
remedy or obtain any relief under, terminate or revoke, suspend, cancel, or
modify or change the current terms of, or renegotiate, or to accelerate the
maturity or performance of, or to increase or impose any Liability under, any
Contract, Law, Order, or Permit.
"EMPLOYEE LEASING" shall mean an arrangement whereby a client of
ACSYS places some or all of its workforce onto the payroll of ACSYS in a co-
employment relationship in which ACSYS assumes responsibility for administration
of payroll, benefits, and other human resources activities for the client;
provided, however, that the term "Employee Leasing" does not include a temporary
help arrangement, whereby an ACSYS Entity hires its own employees and assigns
them to a client to support or supplement the client's workforce in special work
situations, such as employee absences, temporary skill shortages, seasonal
workloads, and special assignments and projects.
"ENVIRONMENTAL LAWS" shall mean all Laws relating to pollution or
protection of human health or the environment (including ambient air, surface
water, ground water, land surface, or subsurface strata) and which are
administered, interpreted, or enforced by the United States Environmental
Protection Agency and state and local agencies with jurisdiction over, and
including common law in respect of, pollution or protection of the environment,
including the Comprehensive Environmental Response Compensation and Liability
Act, as amended, 42 U.S.C. 9601 et seq. ("CERCLA"), the Resource Conservation
and Recovery Act, as amended, 42 U.S.C. 6901 et seq. ("RCRA"), and other Laws
relating to emissions, discharges, releases, or threatened releases of any
Hazardous Material, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of any
Hazardous Material.
"EQUITY RIGHTS" shall mean all arrangements, calls, commitments,
Contracts, options, rights to subscribe to, scrip, understandings, warrants, or
other binding obligations of any character whatsoever relating to, or securities
or rights convertible into or exchangeable for, shares of the capital stock of a
Person or by which a Person is or may be bound to issue additional shares of its
capital stock or other Equity Rights.
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"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"EXHIBITS" 1 through 6, inclusive, shall mean the Exhibits so marked,
copies of which are attached to this Agreement. Such Exhibits are hereby
incorporated by reference herein and made a part hereof, and may be referred to
in this Agreement and any other related instrument or document without being
attached hereto.
"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.
"GBCC" shall mean the Georgia Business Corporation Code.
"HAZARDOUS MATERIAL" shall mean (i) any hazardous substance,
hazardous material, hazardous waste, regulated substance, or toxic substance (as
those terms are defined by any applicable Environmental Laws) and (ii) any
chemicals, pollutants, contaminants, petroleum, petroleum products, or oil (and
specifically shall include asbestos requiring abatement, removal, or
encapsulation pursuant to the requirements of governmental authorities and any
polychlorinated biphenyls).
"HSR ACT" shall mean Section 7A of the ▇▇▇▇▇▇▇ Act, as added by Title
II of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder.
"ICCE AUDITED FINANCIAL STATEMENTS" shall mean the consolidated
balance sheets of ICCE and the ICCE Companies as of December 31, 1996 and 1995,
and consolidated statements of income, changes in shareholders' equity and cash
flows (including related notes and schedules, if any) for the years ended
December 31, 1996, 1995 and 1994, in each case reflecting consummation of the
Reorganization Merger on a pooling of interests basis.
"ICCE CAPITAL STOCK" shall mean, collectively, the ICCE Common Stock,
the ICCE Preferred Stock and any other class or series of capital stock of
ICCE.
"ICCE COMMON STOCK" shall mean the no par value common stock of ICCE.
"ICCE COMPANIES" shall mean ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ & Associates, Inc., DCCA
Professional Temporaries, Inc., EKT, Inc., and Infinity Enterprises, Inc.,
together with ICCE Subsidiaries acquired after the date of this Agreement.
"ICCE DISCLOSURE MEMORANDUM" shall mean the written information
entitled "ICCE, Inc. Disclosure Memorandum" delivered prior to the date of this
Agreement to ACSYS describing in reasonable detail the matters contained therein
and, with respect to each disclosure made therein, specifically referencing each
Section of this Agreement under which such disclosure is being made. Information
disclosed with respect to one Section
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shall not be deemed to be disclosed for purposes of any other Section not
specifically referenced with respect thereto.
"ICCE ENTITIES" shall mean, collectively, ICCE, all ICCE Subsidiaries
and all predecessors thereto.
"ICCE FINANCIAL STATEMENTS" shall mean (i) the ICCE Audited Financial
Statements, and (ii) the consolidated balance sheets of ICCE (including related
notes and schedules, if any) and related statements of income, changes in
shareholders' equity, and cash flows (including related notes and schedules, if
any) with respect to periods ended subsequent to December 31, 1996.
"ICCE MATERIAL ADVERSE EFFECT" shall mean an event, change or
occurrence which, individually or together with any other event, change or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of ICCE and its Subsidiaries, taken as a
whole, or (ii) the ability of ICCE to perform its obligations under this
Agreement or to consummate the Merger or the other transactions contemplated by
this Agreement.
"ICCE PREFERRED STOCK" shall mean the no par value preferred stock of
ICCE.
"ICCE PRELIMINARY FINANCIAL STATEMENTS" shall mean the preliminary
and tentative drafts of consolidated balance sheets of ICCE and the ICCE
Companies as of December 31, 1996 and 1995, and consolidated statements of
income, changes in shareholders' equity and cash flows for the three years ended
December 31, 1996, in each case reflecting consummation of the Reorganization
Merger on a pooling of interests basis.
"ICCE SUBSIDIARIES" shall mean the Subsidiaries of ICCE, which shall
include the ICCE Companies from and after the date of consummation of the
Reorganization Merger and any corporation or other organization acquired as a
Subsidiary of ICCE in the future and held as a Subsidiary by ICCE at the
Effective Time.
"INDEMNIFICATION CLAIM" shall mean a claim for indemnification under
Article 8.
"INDEMNITEES" shall mean the ACSYS Shareholders or the ICCE
Indemnitees, as the case may be, as the parties asserting an Indemnification
Claim.
"INDEMNITOR REPRESENTATIVE(S)" shall mean ICCE, in the case of ICCE,
either of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, in the case of the ICCE
Shareholders, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, in the case of the ACSYS Shareholders.
"INDEMNITORS" shall mean the ACSYS Shareholders, the ICCE
Shareholders or ICCE, as the case may be, as the parties against whom an
Indemnification Claim is asserted.
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"INTELLECTUAL PROPERTY" shall mean copyrights, patents, trademarks,
service marks, service names, trade names, applications therefor, technology
rights and licenses, computer software (including any source or object codes
therefor or documentation relating thereto), trade secrets, franchises, know-
how, inventions, and other intellectual property rights.
"INTERNAL REVENUE CODE" shall mean the Internal Revenue Code of 1986,
as amended, and the rules and regulations promulgated thereunder.
"KNOWLEDGE" as used with respect to a Person (including references to
such Person being aware of a particular matter) shall mean those facts that are
known or should reasonably have been known after due inquiry by the chairman,
president, chief financial officer, chief accounting officer, chief operating
officer, general counsel, any assistant or deputy general counsel, or any
senior, executive or other vice president of such Person, and in the case of
ACSYS, shall include the Knowledge of the ACSYS Shareholders.
"LAW" shall mean any code, law (including common law), ordinance,
regulation, reporting or licensing requirement, rule, or statute applicable to a
Person or its Assets, Liabilities, or business, including those promulgated,
interpreted or enforced by any Regulatory Authority.
"LIABILITY" shall mean any direct or indirect, primary or secondary,
liability, indebtedness, obligation, penalty, cost or expense (including costs
of investigation, collection and defense), claim, deficiency, guaranty or
endorsement of or by any Person (other than endorsements of notes, bills,
checks, and drafts presented for collection or deposit in the ordinary course of
business) of any type, whether accrued, absolute or contingent, liquidated or
unliquidated, matured or unmatured, or otherwise.
"LIEN" shall mean any conditional sale agreement, default of title,
easement, encroachment, encumbrance, hypothecation, infringement, lien,
mortgage, pledge, reserva reservation, restriction, security interest, title
retention or other security arrangement, or any ad verse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for current property Taxes
not yet due and payable, and (ii) Liens which do not materially impair the use
of or title to the Assets subject to such Lien.
"LITIGATION" shall mean any action, arbitration, cause of action,
claim, complaint, criminal prosecution, governmental or other examination or
investigation, hearing, administrative or other proceeding relating to or
affecting a Party, its business, its Assets (including Contracts related to it),
or the transactions contemplated by this Agreement.
"LOSSES" shall mean any and all demands, claims, actions or causes of
action, assessments, losses, diminution in value, damages (including special and
consequential damages), liabilities, costs, and expenses, including interest,
penalties, cost of investigation and defense, and reasonable attorneys' and
other professional fees and expenses.
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"MATERIAL" for purposes of this Agreement shall be determined in
light of the facts and circumstances of the matter in question; provided that
any specific monetary amount stated in this Agreement shall determine
materiality in that instance.
"OPERATING PROPERTY" shall mean any property owned, leased, or
operated by the Party in question or by any of its Subsidiaries or in which such
Party or Subsidiary holds a security interest or other interest (including an
interest in a fiduciary capacity), and, where required by the context, includes
the owner or operator of such property, but only with respect to such property.
"ORDER" shall mean any administrative decision or award, decree,
injunction, judgment, order, quasi-judicial decision or award, ruling, or writ
of any federal, state, local or foreign or other court, arbitrator, mediator,
tribunal, administrative agency, or Regulatory Authority.
"PARTICIPATION FACILITY" shall mean any facility or property in which
the Party in question or any of its Subsidiaries participates in the management
and, where required by the context, said term means the owner or operator of
such facility or property, but only with respect to such facility or property.
"PARTY" shall mean either ACSYS or ICCE, and "PARTIES" shall mean
both ACSYS and ICCE.
"PBCL" shall mean the Pennsylvania Business Corporation Law.
"PERMIT" shall mean any federal, state, local, and foreign
governmental approval, authorization, certificate, easement, filing, franchise,
license, notice, permit, or right to which any Person is a party or that is or
may be binding upon or inure to the benefit of any Person or its securities,
Assets, or business.
"PERSON" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting in a
representative capacity.
"REGULATORY AUTHORITIES" shall mean, collectively, the SEC, the
Federal Trade Commission, the United States Department of Justice, and all other
federal, state, county, local or other governmental or regulatory agencies,
authorities (including self-regulatory authorities), instrumentalities,
commissions, boards or bodies having jurisdiction over the Parties and their
respective Subsidiaries.
"REORGANIZATION AGREEMENT" shall mean that certain Agreement and Plan
of Reorganization, dated as of April 16, 1997, by and among ICCE, the ICCE
Companies, ▇▇▇▇▇▇ Acquisition, Inc., DCCA Acquisition, Inc., EKT Acquisition,
Inc. and Infinity Acquisition, Inc., as the same may be amended from time to
time.
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"REORGANIZATION MERGER" shall mean the "Merger" defined in the
Reorganization Agreement.
"REPRESENTATIVE" shall mean any investment banker, financial advisor,
attorney, accountant, consultant, or other representative engaged by a Person.
"SECURITIES LAWS" shall mean the 1933 Act, the 1934 Act, the
Investment Company Act of 1940, as amended, the Investment Advisors Act of 1940,
as amended, the Trust Indenture Act of 1939, as amended, and the rules and
regulations of any Regulatory Authority promulgated thereunder.
"SUB COMMON STOCK" shall mean the $1.00 par value common stock of
Sub.
"SUBSIDIARIES" shall mean all those corporations, associations, or
other business entities of which the entity in question either (i) owns or
controls 50% or more of the outstanding equity securities either directly or
through an unbroken chain of entities as to each of which 50% or more of the
outstanding equity securities is owned directly or indirectly by its parent
(provided, there shall not be included any such entity the equity securities of
which are owned or controlled in a fiduciary capacity), (ii) in the case of
partnerships, serves as a general partner, (iii) in the case of a limited
liability company, serves as a managing member, or (iv) otherwise has the
ability to elect a majority of the directors, trustees or managing members
thereof.
"SURVIVING CORPORATION" shall mean ACSYS as the surviving corporation
resulting from the Merger.
"TAX RETURN" shall mean any report, return, information return, or
other information required to be supplied to a taxing authority in connection
with Taxes, including any return of an affiliated or combined or unitary group
that includes a Party or its Subsidiaries.
"TAX" or "TAXES" shall mean any federal, state, county, local, or
foreign taxes, charges, fees, levies, imposts, duties, or other assessments,
including income, gross receipts, excise, employment, sales, use, transfer,
license, payroll, franchise, severance, stamp, occupation, windfall profits,
environmental, federal highway use, commercial rent, customs duties, capital
stock, paid-up capital, profits, withholding, Social Security, single business
and unemployment, disability, real property, personal property, registration, ad
valorem, value added, alternative or add-on minimum, estimated, or other tax or
governmental fee of any kind whatsoever, imposed or required to be withheld by
the United States or any state, county, local or foreign government or
subdivision or agency thereof, including any interest, penalties, and additions
imposed thereon or with respect thereto.
(b) The terms set forth below shall have the meanings ascribed
thereto in the referenced sections:
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ACSYS Options Section 4.4(a)
ACSYS Benefit Plans Section 4.14
ACSYS Contracts Section 4.15
ACSYS ERISA Plan Section 4.14
ACSYS Pension Plan Section 4.14
ACSYS Options Section 4.4
ACSYS Shareholders Article 4
ACSYS Stock Plan Section 3.7
ASR 130 and 135 Section 3.6(b)
Certificates Section 3.4
Closing Section 1.2
▇▇▇▇▇▇▇ Agreement Section 7.2(f)
Escrow Section 3.8
Escrow Agreement Section 3.9
Effective Time Section 1.3
Employment Agreements Section 7.1(e)
ERISA Affiliate Section 4.14(c)
Exchange Ratio Section 3.1(c)
ICCE Benefit Plans Section 5.14
ICCE Contracts Section 5.18
ICCE ERISA Plan Section 5.14
ICCE Pension Plan Section 5.14
Merger Section 1.1
Merger Shares Section 3.1(c)
Non-Solicitation Agreements Section 7.1(f)
Registration Rights Agreement Section 7.1(d)
Released Claims Section 6.3
Releasees Section 6.3
(c) Any singular term in this Agreement shall be deemed to include
the plural, and any plural term the singular. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed
followed by the words "without limitation."
10.2 EXPENSES.
--------
(a) Except as otherwise provided in this Section 10.2, each of the
Parties shall bear and pay all direct costs and expenses incurred by it or on
its behalf in connection with the transactions contemplated hereunder, including
filing, registration and application fees, printing fees, and fees and expenses
of its own financial or other consultants, investment bankers, accountants, and
counsel.
(b) Nothing contained in this Section 10.2 shall constitute or shall
be deemed to constitute liquidated damages for the willful breach by a Party of
the terms of this Agreement or otherwise limit the rights of the nonbreaching
Party.
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10.3 BROKERS AND FINDERS. Each of the Parties represents and warrants
-------------------
that neither it nor any of its officers, directors, employees, or Affiliates has
employed any broker or finder or incurred any Liability for any financial
advisory fees, investment bankers' fees, brokerage fees, commissions, or
finders' fees in connection with this Agreement or the transactions contemplated
hereby; provided, however, that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ shall be due a brokerage
fee in connection with the Merger, which fee will be paid by ACSYS Entities at
the Effective Time. In the event of a claim by any other broker or finder based
upon his or its representing or being retained by or allegedly representing or
being retained by ACSYS or any ACSYS Shareholder or by ICCE, each of ACSYS and
the ACSYS Shareholders and ICCE, as the case may be, agrees to indemnify and
hold the other Party harmless of and from any Liability in respect of any such
claim.
10.4 ENTIRE AGREEMENT. Except as otherwise expressly provided herein,
----------------
this Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral. Nothing in this Agreement
expressed or implied, is intended to confer upon any Person, other than the
Parties or their respective successors, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement.
10.5 AMENDMENTS. To the extent permitted by Law, this Agreement may be
----------
amended by a subsequent writing signed by each of the Parties upon the approval
of each of the Parties, whether before or after shareholder approval of this
Agreement has been obtained; provided, that after any such approval by the
holders of ACSYS Common Stock, there shall be made no amendment that pursuant to
Section 1924(a) of the PBCL requires further approval by such shareholders
without the further approval of such shareholders.
10.6 WAIVERS.
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(a) Prior to or at the Effective Time, ICCE, acting through its Board
of Directors, chief executive officer or other authorized officer, shall have
the right to waive any Default in the performance of any term of this Agreement
by ACSYS or the ACSYS Shareholders, to waive or extend the time for the
compliance or fulfillment by ACSYS or the ACSYS Shareholders of any and all of
its obligations under this Agreement, and to waive any or all of the conditions
precedent to the obligations of ICCE under this Agreement, except any condition
which, if not satisfied, would result in the violation of any Law (or that would
constitute an amendment that, without shareholder consent, would be prohibited
by the PBCL). No such waiver shall be effective unless in writing signed by a
duly authorized officer of ICCE.
(b) Prior to or at the Effective Time, ACSYS, acting through its
Board of Directors, chief executive officer or other authorized officer, shall
have the right to waive any Default in the performance of any term of this
Agreement by ICCE, to waive or extend the time for the compliance or fulfillment
by ICCE of any and all of its obligations under this Agreement, and to waive any
or all of the conditions precedent to the obligations of ACSYS and the ACSYS
Shareholders under this Agreement, except any condition which, if not satisfied,
would result in
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the violation of any Law (or that would constitute an amendment
that, without shareholder consent, would be prohibited by the PBCL). No such
waiver shall be effective unless in writing signed by a duly authorized officer
of ACSYS.
(c) The failure of any Party at any time or times to require
performance of any provision hereof shall in no manner affect the right of such
Party at a later time to enforce the same or any other provision of this
Agreement. No waiver of any condition or of the breach of any term contained in
this Agreement in one or more instances shall be deemed to be or construed as a
further or continuing waiver of such condition or breach or a waiver of any
other condition or of the breach of any other term of this Agreement.
10.7 ASSIGNMENT. Except as expressly contemplated hereby, neither this
----------
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any Party hereto (whether by operation of Law or otherwise) without
the prior written consent of the other Party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the Parties and their respective successors and assigns.
10.8 NOTICES. All notices or other communications which are required or
-------
permitted hereunder shall be in writing and sufficient if delivered by hand, by
facsimile transmission, by registered or certified mail, postage pre-paid, or by
courier or overnight carrier, to the persons at the addresses set forth below
(or at such other address as may be provided hereunder), and shall be deemed to
have been delivered as of the date so delivered:
ACSYS or
any ACSYS Shareholder: ACSYS Resources, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Copy to Counsel: ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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ICCE: ICCE, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇.
Copy to Counsel: ▇▇▇▇▇▇ & Bird LLP
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
10.9 GOVERNING LAW. This Agreement shall be governed by and construed
-------------
in accordance with the Laws of the State of Georgia, except to the extent that
the Laws of the Commonwealth of Pennsylvania shall govern the provisions of
Articles 1, 2 and 3, in each case without regard to any applicable conflicts of
Laws.
10.10 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
10.11 CAPTIONS; ARTICLES AND SECTIONS. The captions contained in this
-------------------------------
Agreement are for reference purposes only and are not part of this Agreement.
Unless otherwise indicated, all references to particular Articles or Sections
shall mean and refer to the referenced Articles and Sections of this Agreement.
10.12 INTERPRETATIONS. Neither this Agreement nor any uncertainty or
---------------
ambiguity herein shall be construed or resolved against any party, whether under
any rule of construction or otherwise. No party to this Agreement shall be
considered the draftsman. The parties acknowledge and agree that this Agreement
has been reviewed, negotiated, and accepted by all parties and their attorneys
and shall be construed and interpreted according to the ordinary meaning of the
words used so as fairly to accomplish the purposes and intentions of all parties
hereto.
10.13 SEVERABILITY. Any term or provision of this Agreement which is
------------
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf by its duly authorized officers and each of the ICCE
Shareholders and the ACSYS Shareholders has executed this Agreement under seal
as of the day and year first above written.
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ICCE, INC. SHAREHOLDERS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
-------------------
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
/s/ D. ▇▇▇▇▇ ▇▇▇▇▇
------------------
D. ▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------
▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇.▇▇▇▇▇▇▇▇
----------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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ASRI MERGER SUBSIDIARY, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇.
_____________________
President
ACSYS RESOURCES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
President
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THE SHAREHOLDERS:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (SEAL)
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇ (SEAL)
-----------------
▇▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
---------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (SEAL)
-------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (SEAL)
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (SEAL)
----------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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