1
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT, dated as of August___, 1999, and
effective as of September 1, 1999, by and among MARIO'S EQUIPMENT RENTAL, INC.,
a Florida Corporation having its principal place of business at 00000 Xxxxx
Xxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 ( hereinafter referred to as ("SELLER") and
DELTA SITE DEVELOPMENT CORP., a Florida Corporation ("PURCHASER"), with its
principal place of business at 0000 Xxxxx Xxxxxxxxx Xxxx, Xxxxxxx Xxxxx, Xxxxxxx
00000, with reference to the following RECITALS:
A. SELLER, is engaged in the construction site preparation
business with an emphasis on property grading and waste collection in Xxxxxxx,
Palm Beach, and Xxx Counties (herein, the "SELLER'S Business").
B. PURCHASER is engaged in the primary business of waste
collection, land filling, and construction and demolition debris removal
throughout Florida, and also engages in a secondary business of construction
site preparation with an emphasis on property grading and waste collection in
Broward and Dade Counties (herein the "PURCHASER'S Business").
C. After the transaction PURCHASER or its designated
subsidiary shall have acquired rights to all of the assets and certain of the
liabilities of SELLER.
D. Subject only to the limitations and exclusions contained in
this Agreement and on the terms and conditions hereinafter set forth, SELLER
desires to sell and PURCHASER desires to purchase the assets and assume the
liabilities of the SELLER as more particularly described herein.
E. PURCHASER will be a wholly owned subsidiary of STAR
SERVICES GROUP, INC. ("STAR"), and certain of the obligations herein are to be
performed by STAR and for such reason STAR is executing this Agreement.
NOW THEREFORE, in consideration of the recitals and of the
respective covenants, representations, warranties and agreements herein
contained, and intending to be legally bound hereby, the parties hereto hereby
agree as follows:
ARTICLE I - PURCHASE AND SALE
1.1. Agreement to Sell. At the Closing hereunder (as defined in Section
2.1 hereof) and except as otherwise specifically provided in this Section 1.1,
SELLER shall grant, sell, convey, assign, transfer and deliver to PURCHASER,
upon and subject to the terms and conditions of this Agreement, all right, title
and interest of SELLER in and to the assets of SELLER as indicated on SCHEDULE
1.1 free and clear of all encumbrances except as set forth on such Schedule.
PURCHASER shall assume the liabilities of SELLER as are set forth on Schedule
1.1 and as were otherwise disclosed in writing to or known by SELLER prior to
the closing.
1.2 Agreement to Purchase. At the Closing hereunder, PURCHASER shall
purchase the
1
2
Assets from SELLER, upon and subject to the terms and conditions of this
Agreement and in reliance on the representations, warranties and covenants of
SELLER contained herein, in exchange for the Purchase Price (hereinafter defined
in Section 1.3 hereof).
1.3 The Purchase Price.
1.3.1 Purchase Price. The Purchase Price shall be Five Hundred
Thousand and No/100 Dollars ($500,000.00) which shall be payable as follows:
a) One Hundred Thousand and No/100 Dollars ($100,000.00) by
delivery of a seven (7%) percent Promissory Note payable in thirty six (36)
equal monthly installments of interest and principal. This Note can be
restructured if agreed by the parties prior to closing in any way as long as it
does not increase the monthly payment.
b) Four Hundred Thousand and No/100 Dollars ($400,000.00) by
delivery of Star Services Group, Inc., Common Stock which will be restricted so
that it will be sellable fifty (50%) percent after the first anniversary of the
transaction and fifty (50%) percent after the second anniversary. For purposes
of determining the number of shares issued, the Star shares will be valued at of
Four Dollars ($4.00) per share. It is intended that prior to the closing, Star
Services Group, Inc. will be a publicly traded corporation listed on a national
exchange, and this expectation is a material inducement to Seller for this
transaction.
1.3.2 Payment at Closing. At the Closing, the PURCHASER shall
in the aggregate deliver all of the agreed upon number of shares, and the
Promissory Note.
1.3.3 Allocation of Purchase Price. The Purchase Price shall
be allocated among the Assets acquired hereunder as described on SCHEDULE "1.1"
hereof. SELLER and PURCHASER each hereby covenant and agree that it will not
take a position on any income tax return, before any governmental agency charged
with the collection of any income tax, or in any judicial proceeding that is in
any way inconsistent with the terms of this Section 1.3.3.
1.3.4 Adjustment to Price. The Purchase Price set forth above
shall be reviewed for adjustment twice after the closing to reflect any
difference either positively or negatively between the various receivables and
certain of the liabilities of SELLER acquired by PURCHASER as they are fixed and
determined on September 1, 1999, on a "dollar for dollar" basis, such that, if
the account receivables exceed the sum of the accounts payable and the assumed
Seven Thousand Five Hundred and No/100 Dollar ($75,000.00) Note from SELLER to
Xxxx Xxxxxx (herein "adjustment liabilities"), the price will increase by one
dollar for each dollar of positive difference (and conversely, if the adjustment
liabilities exceed the account receivables, the price will decrease by one
dollar for each dollar of negative difference.) The Note will provide for this
adjustment for any positive or negative difference between the receivables and
adjustment liabilities which exist as of September 1, 1999, but which becomes
known at the adjustment dates. The parties shall review updated (or completed)
financial information for the September 1, 1999 effective date and make any
adjustments sixty (60) and one hundred eighty (180) days after Closing. There is
one other possible adjustment to the Purchase Price after the Closing for
reasons set forth in paragraph 6.6 of this Agreement.
2
3
ARTICLE II - CLOSING, ITEMS TO BE DELIVERED, THIRD PARTY CONSENTS, CHANGE IN
NAME AND FURTHER ASSURANCES.
2.1 Closing. The Closing (the "Closing") of the sale and purchase of
the Assets shall take place at 11:00 A.M., local time, on August 19, 1999 at
PURCHASER's office, or on such other date as may be mutually agreed upon in
writing by PURCHASER and SELLER. The date of the Closing is sometimes herein
referred to as the "CLOSING DATE." This transaction's effective date is
September 1, 1999.
2.2 Items to be Delivered at Closing. At the Closing and subject to the
terms and conditions herein contained:
(a) SELLER shall deliver to PURCHASER the following:
(i) such bills of sale with covenants of warranty,
assignments, endorsements, and other good and
sufficient instruments and documents of conveyance
and transfer, in form reasonably satisfactory to
PURCHASER and its counsel, as shall be necessary and
effective to transfer and assign to, and vest in,
PURCHASER all of SELLER's right, title and interest
in and to the Assets.
(ii) all of the agreements, contracts, commitments,
equipment leases, plans, bids, quotations, proposals,
instruments, computer programs and software, data
bases whether in the form of computer tapes or
otherwise, related object and source codes, manuals
and guidebooks, price books and price lists, customer
and subscriber lists, supplier lists, sales records,
files, correspondences, legal opinions, rulings
issued by governmental entities, and other documents,
books, records, papers, files, office supplies and
data belonging to SELLER which are part of the
Assets;
(iii) An acceptable lease or sublease for such
equipment, whose lenders have not, as of the closing,
consented to a transfer of the equipment's lease or
title to Delta Site Development Corp. with a release
of the guarantee of the purchase loan or lease.
(b) PURCHASER shall deliver to SELLER the following:
(i) the shares of Star Services Group, Inc. (or
appropriate assurances therefor acceptable to counsel
for Xxxx Xxxxxx)
(ii) the Purchase Money $100,000.00 Promissory Note,
and related documents.
3
4
(iii) a conditional guarantee of the SELLER's Note to
Xxxx Xxxxxx, such guarantee given by Delta Recycling
Corp. as provided in paragraph 9.6 hereof.
(c) at or prior to the Closing, the parties hereto shall
also deliver to each other the agreements, opinions,
certificates and other documents and instruments
referred to in this Agreement.
2.3 Further Assurances. Each of the parties hereto will cooperate with
the other and execute and deliver to the other parties hereto, without further
consideration, such other instruments and documents and take such other actions
as may be reasonably requested from time to time by any other party hereto as
necessary to carry out, evidence and confirm the intended purposes of this
Agreement.
ARTICLE III - REPRESENTATIONS AND WARRANTIES OF SELLER
SELLER represents and warrants to the PURCHASER as follows:
3.1 Organization and Qualification. SELLER is a corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation. To the best of SELLER's knowledge, it has all
requisite power and authority, and all necessary consents, authorizations,
approvals, orders, licenses, certificates, and permits of and from, and
declarations and filings with, all federal, state, local, and other governmental
authorities and all courts and other tribunals, to own, lease, license, and use
its properties and assets and to carry on the SELLER'S Business in which it is
now engaged. To the best of SELLER's knowledge, SELLER is duly qualified to
transact the SELLER'S Business in which it is engaged and is in good standing as
a foreign corporation in every jurisdiction in which its ownership, leasing,
licensing, or use of property or assets or the conduct of their business makes
such qualification necessary.
3.2 Tax and Other Liabilities. To the best of SELLER's knowledge,
SELLER has no liability of any nature, accrued or contingent, including without
limitation liabilities for federal, state, local, or foreign taxes and
penalties, interest, and additions to tax ("Taxes") and liabilities to customers
or suppliers, which has not been disclosed to PURCHASER.
3.3 Litigation and Claims. To the best of SELLER's knowledge, there is
no litigation, arbitration, claim, governmental action or other proceeding
(formal or informal), or investigation pending, threatened, or in prospect (or
any basis therefor known to SELLER) with respect to SELLER, or any of its or the
SELLER'S Business, properties, or assets, and SELLER is not affected by any
present or threatened strike or other labor disturbance. To the best of Seller's
knowledge, SELLER is not in violation of, or in default with respect to, any
law, rule, regulation, order, judgment, or decree, nor is SELLER required to
take any action in order to avoid such violation or default.
3.4 Assets and Properties. SCHEDULE 1.1 lists all of the tangible and
intangible properties and assets of SELLER. To the best of SELLER's knowledge,
SELLER has good and marketable title to the Assets (except such properties and
assets as are held pursuant to leases or
4
5
licenses described in SCHEDULE 1.4), free and clear of all liens, mortgages,
security interests, pledges, charges, and encumbrances (except such as may be
listed in SCHEDULE 1.1 or otherwise disclosed to PURCHASER prior to the
closing). To the best of SELLER's knowledge, upon consummation of the
transactions contemplated hereby, PURCHASER will acquire good and marketable
title to the Assets. As disclosed to the Purchaser, certain of the SELLER's
equipment is leased where the lease was guaranteed by Xxxx Xxxxxx (or his
businesses), or was purchased where the purchase was guaranteed by Xx. Xxxxxx
(or his businesses). The lessor or lender may not have consented to the transfer
of the equipment's possession or title to the PURCHASER as of the closing date
with a release of the guarantee. As to such equipment, it shall be subleased or
leased to the PURCHASER for a time commensurate with the lease or loan as the
case may be, at a cost equal to the rental paid or debt service for the
equipment. If any such sublease or lease transfer shall trigger any default
under any agreement with lessor or lender, then such default shall not be a
default under this Asset Purchase Agreement, but SELLER shall have sixty (60)
days to substitute equipment to PURCHASER of like kind, age, and condition.
SELLER may at the time this Agreement is executed maintain its corporate
existence after the Closing to conduct such business as is permissible pursuant
to its Articles of Incorporation, Florida law, and this Agreement.
3.5 Contracts and Other Instruments. SCHEDULE 3.5 accurately and
completely sets forth the information required to be contained therein regarding
contracts, agreements, instruments, equipment leases, licenses, arrangements, or
understandings with respect to SELLER. SELLER has furnished to the PURCHASER (a)
the Certificate of Incorporation and by-laws of SELLER and all amendments
thereto, as presently in effect, certified by the Secretary of the corporation
and (b) the following, initialed by the chief executive officer of SELLER: (i)
true and correct copies of all contracts, agreements, and instruments referred
to in SCHEDULE 3.5; (ii) true and correct copies of all equipment leases and
licenses referred to in SCHEDULE 3.5; and (iii) true and correct written
descriptions of all supply, distribution, agency, financing, or other
arrangements or understandings referred to in SCHEDULE 3.5.
To the best of SELLER's knowledge, it is not now in violation
or breach of, or in default with respect to complying with, any material term of
any contract, agreement, instrument, equipment lease, or license to which it is
a party or owns, and each such contract, agreement, instrument, equipment lease,
or license is in full force and is the legal, valid, and binding obligation of
the SELLER thereto and (subject to applicable bankruptcy, insolvency, and other
laws or doctrines affecting the enforceability of creditors' rights generally or
affecting the enforceability of such obligations) is enforceable as to them in
accordance with its terms. To the best of SELLER's knowledge, each such supply,
distribution, agency, financing, or other arrangement or understanding is a
valid and continuing arrangement or understanding; neither SELLER, nor any other
party to any such arrangement or understanding has given notice of termination
or to the best of SELLER's knowledge taken any action inconsistent with the
continuance of such arrangement or understanding; and the execution, delivery,
and performance of this Agreement will not in and of itself prejudice any such
arrangement or understanding in any way. Some of the contracts SELLER has made
with its customers may not be assignable without the consent of the customer;
consequently, no warranty or representation as to customer contract
assignability is included herein. Additionally, some of the purchase money
lenders of equipment purchased by Mario's Equipment Rental, Inc., or the lessors
of such equipment as is
5
6
leased by Mario's Equipment Rental, Inc., may not consent to such equipment's
transfer to the PURCHASER; consequently, no warranty or representation about the
transferability of such equipment's title or leases are made herein. Where
needed after closing, SELLER will use its best reasonable efforts to procure the
approval of an assignment to PURCHASER of contracts that exist between the
SELLER and its customers; however, the failure to procure such approval will not
invalidate this Agreement, but the Purchase Price may be affected as provided in
paragraph 6.6. The stock ledgers and stock transfer books and the minute book
records of SELLER relating to all issuances and transfers of stock by SELLER and
all proceedings of the stockholders and the Board of Directors and committees
thereof of SELLER since its incorporation made available to PURCHASER's counsel
for review prior to closing are the original stock ledgers and stock transfer
books and minute book records of SELLER or exact copies thereof. To the best of
Seller's knowledge, SELLER is not in violation or breach of, or in default with
respect to, any term of its Certificate of Incorporation (or other charter
document) or by-laws.
3.6 Employees. Nothing contained in this Agreement or otherwise shall
obligate PURCHASER to employ any person who is now or in the future employed by
SELLER except for Xxxx Xxxxxx, Xxxx Xxxxxxx, Xxxxx Xxxxxxxxxx, Xxxx Xxxxxx, and
Xxxxxx Xxxxxxxx.
3.7 Patents, Trademarks, Et Cetera. To the best of SELLER's knowledge,
SELLER does not own or have pending, or are licensed under, any patent, patent
application, trademark, trademark application, trade name, service xxxx,
copyright, franchise, or other intangible property or asset (all of the
foregoing being herein called "Intangibles"), other than as described in
SCHEDULE 1.1, all of which are in good standing and uncontested.
3.8 Authority to Sell. SELLER has all requisite power and authority to
execute, deliver, and perform this Agreement. All necessary corporate
proceedings of SELLER has been duly taken to authorize the execution, delivery,
and performance of this Agreement by SELLER. This Agreement has been duly
authorized, executed, and delivered by SELLER and constitutes the legal, valid,
and binding obligation of SELLER and is enforceable as to them in accordance
with its terms.
3.9 Consents for Sale. To the best of SELLER's knowledge, no
consent, authorization, approval, order, license, certificate, or permit of or
from, or declaration or filing with, any federal, state, local, or other
governmental authority or any court or other tribunal is required by SELLER for
the sale of the Business to PURCHASER. To the best of SELLER's knowledge, no
consent of any party to any contract, agreement, instrument, lease, license,
arrangement, or understanding to which SELLER is a party, or to which it or he
or any of its or his respective businesses, properties, or assets are subject,
is required for the sale of the Business to PURCHASER. To the best of SELLER's
knowledge, the execution, delivery, and performance of this Agreement will not:
(a) violate, result in a breach of, conflict with, or (with or without the
giving of notice or the passage of time or both) entitle any party to terminate
or call a default under, entitle any party to rights and privileges that such
party was not receiving or entitled to receive immediately before this Agreement
was executed (except for service contracts between the SELLER and customers
which may not be assignable without the customer's consent); or, (b) create any
obligation on the part of SELLER that it was not paying or obligated to pay
immediately before this Agreement was executed under, any term of any such
contract, agreement, instrument, equipment lease, license, arrangement, or
understanding; or, (c) violate or result in a breach of any term of the
Certificate
6
7
of Incorporation (or other charter document) or by-laws of SELLER, or violate,
result in a breach of, or conflict with any law, rule, regulation, order,
judgment or decree binding on SELLER, or any Stockholder or to which it or he or
any of its or his respective businesses, properties, or assets are subject.
3.10 Completeness of Disclosure. No representation or warranty by the
Seller in this Agreement contains or on the date of the Closing will contain an
untrue statement of material fact or omits or on the date of the Closing will
omit to state a material fact required to be stated therein or necessary to make
the statements made therein not misleading.
3.11 Audit. The books, records and the Financial Statements of the
SELLER are auditable and an audit will be completed prior to Closing.
ARTICLE IV. - REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The PURCHASER represents and warrants to SELLER as follows:
4.1 Organization. The PURCHASER is a corporation duly organized,
validly existing, and in good standing under the laws of its jurisdiction of
incorporation. To the best of PURCHASER's knowledge, it has, with all requisite
power and authority, and all necessary consents, authorizations, approvals,
orders, licenses, certificates, and permits of and from, and declarations and
filings with, all federal, state, local, and other governmental authorities and
all courts and other tribunals, to own, lease, license, and use its properties
and assets and to carry on the PURCHASER'S Business in which it is now engaged
and the business in which it contemplates engaging. To the best of PURCHASER's
knowledge, PURCHASER is duly qualified to transact the PURCHASER'S Business in
which it is engaged and is in good standing as a foreign corporation in every
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of their business makes such qualification necessary.
4.2 Authority to Buy. The PURCHASER has all requisite power and
authority to execute, deliver, and perform this Agreement. All necessary
corporate proceedings of the PURCHASER have been duly taken to authorize the
execution, delivery, and performance of this Agreement by the PURCHASER. This
Agreement has been duly authorized, executed, and delivered by the PURCHASER, is
the legal, valid, and binding obligation of the PURCHASER, and is enforceable as
to it in accordance with its terms.
4.3 Conflicts. The execution and delivery of this Agreement and the
instruments and documents to be delivered by PURCHASER pursuant to this
Agreement, the consummation of the transactions contemplated by this Agreement
and the compliance with the terms, conditions and provisions of this Agreement
by PURCHASER will not (i) contravene any provision of PURCHASER'S articles of
incorporation or bylaws; or (ii) conflict with or result in a breach of or
constitute a default (or an event which might, with the passage of time or the
giving of notice or both, constitute a default) under any of the terms,
conditions or provisions of any indenture, mortgage, loan or credit agreement or
any other agreement or instrument to which PURCHASER is a party or by which it
or its assets may be bound or affected, or any judgment or order of any court or
7
8
governmental department, commission, board, agency or instrumentality, domestic
or foreign, or any applicable law, rule or regulation.
4.4 Litigation and Claims. There are no actions, suits, investigations
or proceedings pending or, to PURCHASER'S knowledge, threatened against or
affecting PURCHASER, its executive officers or directors at law or in equity, by
or before any court or governmental department, agency or instrumentality that
would prevent PURCHASER from consummating the transactions contemplated hereby
and fulfilling its obligations hereunder. PURCHASER is not in violation of, or
in default in respect to any law, rule, regulations, order, judgment, or decree;
nor is PURCHASER required to take any action in order to avoid such violation or
default. To the best of PURCHASER's knowledge, it is not now in violation or
breach of, or in default with respect to complying with, any material term of
any contract, agreement, lease or license, and additionally is not aware of any
facts that could result in a claim or lawsuit against the PURCHASER which would
materially affect the PURCHASER's financial status or ability to transact its
contemplated business.
4.5 Completeness of Disclosure. No representation or warranty made by
PURCHASER in this Agreement contains or on the date of the Closing will contain
an untrue statement of material fact or omits or on the date of the Closing will
omit to state a material fact required to be stated therein or necessary to make
the statements made therein not misleading.
ARTICLE V - AGREEMENTS PENDING CLOSING.
5.1 Conduct of Business. Until Closing, SELLER will conduct its affairs
so that at the Closing no representation or warranty of Seller will be
inaccurate, no covenant or agreement of SELLER will be breached, and no
condition in this Agreement will remain unfulfilled by reason of the actions or
omissions of SELLER. Except as otherwise requested by the PURCHASER in writing,
until the Closing, SELLER will use its best efforts to preserve in full force
and effect the contracts, agreements, instruments, equipment leases, licenses,
arrangements, and understandings of SELLER to be acquired by PURCHASER.
5.2 Access. SELLER shall give to Purchaser's officers, employees,
counsel, accountants and other representatives reasonable access to and the
right to inspect, during normal business hours, all of the premises, properties,
assets, records, contracts and other documents of SELLER and shall permit them
to consult with the officers, employees, accountants, counsel and agents of
SELLER for the purpose of making such investigation of the assets and
liabilities being acquired by PURCHASER.
5.3 Seller' Press Releases. Except as required by applicable law,
SELLER shall not give notice to third parties or otherwise make any public
statement or releases concerning this Agreement or the transactions contemplated
hereby.
5.4 Actions of Purchaser. PURCHASER will not knowingly take any action
which would result in a breach of any of its representations and warranties
hereunder. Furthermore, PURCHASER shall cooperate with SELLER and use its best
efforts to cause all of the conditions to the
8
9
obligations of PURCHASER and SELLER under this Agreement to be satisfied on or
prior to the Closing Date.
5.5 Confidentiality. Unless and until the Closing has been consummated,
PURCHASER will hold, and shall cause its counsel, independent certified public
accountants, appraisers and investment bankers to hold in confidence any
confidential data or information made available to PURCHASER in connection with
this Agreement.
5.5.1 PURCHASER acknowledges that SELLER has previously
disclosed, and may disclose in the future, details concerning the
SELLER and the SELLER'S Business to PURCHASER, and this section
establishes the restrictions and obligations imposed by SELLER upon
PURCHASER in connection with the confidentiality of such disclosures.
5.5.2 SELLER and PURCHASER agree that the disclosure of the
details of the SELLER'S Business may consist of presentations and
demonstrations of the equipment and operation of the Business and may
consist of certain documents, records, designs, writings, drawings,
specifications, prototypes and materials concerning the Business, all
of which are proprietary, and were or are given solely to enable
PURCHASER to evaluate the Business. Any such proprietary information,
documentation or devices relating to the Business which are disclosed
or made available by SELLER to PURCHASER shall hereinafter by referred
to as "Confidential Information", and written information shall be
marked by PURCHASER as "Confidential". "Proprietary information" means
written information, as well as tangible materials, identified as
proprietary and not generally available to the public or otherwise
known by PURCHASER. PURCHASER shall not, during the term of this
Agreement and for a period of two (2) years after its termination, at
any time or in any manner, either directly or indirectly, divulge,
disclose, or communicate to any person, firm, corporation, partnership,
or any other entity, any other information concerning any matters
affecting or relating to the Business of SELLER which is a "trade
secret." For purposes of this Agreement the term "trade secret" shall
be defined as provided in Florida Statute ss.688.002(4).
5.5.3 PURCHASER shall not, during the term of this Agreement
and for a period of two (2) years following its termination, either
directly or indirectly for itself or for any other person, firm,
company, partnership, joint venture, trust, or corporation, call upon,
solicit, divert, or take away, or attempt to do so, any of the
customers, contact persons, purchasers, or prospective purchasers of
SELLER with which PURCHASER has become acquainted or acquired the names
of during the course of PURCHASER's exposure to SELLER's propriety
information. However, the paragraph shall not affect PURCHASER'S
ability to continue to conduct its primary business of waste
collection, land filling, and construction and demolition debris
removal anywhere in Florida, nor shall it prevent PURCHASER from
continuing to conduct its secondary construction site preparation
business in Broward and Dade Counties, with any of PURCHASER'S
customers, contact persons, purchasers or prospects that PURCHASER had
prior to signing this Agreement and with whom PURCHASER did not
become acquainted with or exposed to during the course of PURCHASER'S
exposure to SELLER'S proprietary information.
9
10
5.5.4 In consideration of the disclosure of the Confidential
Information by SELLER to PURCHASER, PURCHASER undertakes and agrees to
be bound by the following obligations:
A. PURCHASER shall treat the Confidential Information
as strictly confidential, shall not disclose Confidential
Information or any portion thereof to any party whatsoever and
shall take all reasonable measures necessary to prevent
disclosure to others; and
B. PURCHASER shall not copy in whole or in part any
portion of the Confidential Information; and
C. PURCHASER shall only deal with and utilize the
Confidential Information during the term of this Agreement,
and for the sole purposes set forth in this Agreement; and
D. The Confidential Information given to PURCHASER
will not be used by PURCHASER, or embodied in any of its
products or exploited in any way by PURCHASER.
E. PURCHASER shall limit the dissemination of the
Confidential Information to only those individuals who have a
need to know the Confidential Information in order to perform
and carry out the terms of this Agreement and shall direct
these representatives to hold in confidence all such
information received; and
F. PURCHASER shall promptly return the Confidential
Information, in whatever form the Confidential Information is
received by PURCHASER, including, but not limited to, any and
all prototypes, documents, writings, drawings, materials,
copies, records, documents and any other representations
thereof, to SELLER immediately upon receipt of request
therefor from SELLER, or upon the expiration, termination or
cancellation of this Agreement, which ever shall first occur.
PURCHASER and its representatives shall remain responsible for
the confidentiality imposed by this Agreement after the
expiration, termination and cancellation of this Agreement.
5.5.5 Nothing contained herein shall be construed as
conferring upon PURCHASER any rights to the SELLER'S Business or the
Confidential Information, directly or by implication, estoppel or
otherwise, nor shall any rights arise from this Agreement or from any
negotiations, acts, statements or dealings between SELLER and PURCHASER
in connection with the execution of this Agreement. It is expressly
understood by PURCHASER that no right or license is granted by
implication or otherwise to any of the Confidential Information or to
any Property Rights of SELLER.
5.5.6 The term of this Agreement shall commence as of the date
hereof and shall continue for a period of ninety (90) days, unless
earlier terminated in SELLER's sole
10
11
discretion for any reason whatsoever, or unless earlier terminated by
virtue of the contemplated sale transaction's completion. However, upon
the termination of this Agreement, the duties and obligations of the
PURCHASER as set forth herein regarding non-disclosure and
confidentiality shall continue and survive during such period as SELLER
owns any property or proprietary right in any of the Confidential
Information contemplated by this Agreement.
5.5.7 PURCHASER acknowledges that the disclosures to be made
to it by SELLER pursuant to the terms of this Agreement are to be kept
confidential by PURCHASER and its representatives. In the event
PURCHASER or its representatives breach the terms and conditions of
this Agreement, SELLER shall be entitled to institute and prosecute
proceedings in any court of competent jurisdiction, both in law and in
equity, to obtain damages for any breach of this Agreement.
5.6 Purchaser's Press Releases. Except as required by applicable law,
PURCHASER will not give notice to third parties or otherwise make any public
statement or releases concerning this Agreement or the transactions contemplated
hereby except for such written information as shall have been approved in
writing as to form and content by SELLER, which approval shall not be
unreasonably withheld.
ARTICLE VI - CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PURCHASER
The obligations of the PURCHASER under this Agreement are subject to
the following conditions which shall occur or be waived by the PURCHASER prior
to closing:
6.1 Accuracy of Representations and Compliance with Conditions. All
representations and warranties of SELLER contained in this Agreement shall be
accurate when made and, in addition, shall be accurate as of the Closing as
though such representations and warranties were then made in exactly the same
language by SELLER and such representations and warranties will be made in the
office's closing certificates; as of the Closing SELLER shall have performed and
complied with all covenants and agreements and satisfied all conditions required
to be performed and complied with by any of them at or before such time by this
Agreement (which have not been waived by PURCHASER closing without same); and
the PURCHASER shall have received certificates executed by the chief executive
officer and the chief financial officer of SELLER dated the date of the Closing,
to that effect.
6.2 Other Closing Documents. SELLER shall have delivered to the
PURCHASER at or prior to the closing such other documents as the PURCHASER may
reasonably request in order to enable the PURCHASER to determine whether the
conditions to their obligations under this Agreement have been met and otherwise
to carry out the provisions of this Agreement.
6.3 Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement or incidental thereto and all
other related legal matters shall be subject to the reasonable approval of,
counsel to the PURCHASER, and SELLER and shall have
11
12
furnished PURCHASER'S counsel such documents as such counsel may have reasonably
requested for the purpose of enabling them to pass upon such matters.
6.4 Legal Action. There shall not have been instituted or threatened
any legal proceeding relating to, or seeking to prohibit or otherwise challenge
the consummation of, the transactions contemplated by this Agreement, or to
obtain substantial damages with respect thereto.
6.5 No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, judgment, or decree proposed, promulgated,
enacted, entered, enforced, or deemed applicable to the transactions
contemplated by this Agreement by any federal, state, local, or other
governmental authority or by any court or other tribunal, including the entry of
a preliminary or permanent injunction, which, in the reasonable judgment of the
PURCHASER, (a) makes any of the transactions contemplated by this Agreement
illegal, (b) results in a delay in the ability of the PURCHASER to consummate
any of the transactions contemplated by this Agreement, (c) imposes material
limitations on the ability of the PURCHASER effectively to exercise full rights
of ownership of the assets, or (d) otherwise prohibits, restricts, or delays
consummation of any of the transactions contemplated by this Agreement or
impairs the contemplated benefits to the PURCHASER of any of the transactions
contemplated by this Agreement.
6.6 Contractual Consents Needed. The parties to this Agreement shall
have obtained at or prior to the Closing all consents required for the
consummation of the transactions contemplated by this Agreement from any party
to any contract, agreement, instrument, lease, license, arrangement, or
understanding to which any of them is a party, or to which any of them or any of
their respective businesses, properties, or assets are subject, except for
service contracts between SELLER and its customers. In the event at the end of
PURCHASER'S first fiscal year (which is no less than one (1) year after the
Closing Date) the gross revenue of PURCHASER within such first year shall not
exceed Seven Hundred Fifty Thousand and No/100 Dollars ($750,000.00) as a result
of SELLER'S existing service contracts not being assigned to PURCHASER (if such
assignment is necessary prior to PURCHASER'S performance of such contracts), an
adjustment to the Purchase Price shall be made. The adjustment shall be to
reduce the Purchase Price by One Dollar ($1.00) for each Two Dollars ($2.00) of
gross revenue under Seven Hundred Fifty Thousand and No/100 Dollars
($750,000.00).
ARTICLE VII - CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER.
All obligations of SELLER under this Agreement are subject to
the fulfillment or satisfaction, prior to or at the Closing, of each of the
following conditions precedent:
7.1 Deliveries. PURCHASER shall receive at Closing, all of the Purchase
Price consideration set forth in Section 1.3. Employment Contracts will be
executed with XXXXX XXXXXXXXXX, XXXX XXXXXX, and XXXX XXXXXXX, in the form
approved by PURCHASER'S counsel.
7.2 Representations and Warranties True as of the Closing Date. The
representations
12
13
and warranties of PURCHASER contained in this Agreement or in any list,
certificate or document delivered by PURCHASER to SELLER pursuant to the
provisions hereof shall be true on the Closing Date with the same effect as
though such representations and warranties were made as of such date.
7.3 Compliance with this Agreement. PURCHASER shall have performed and
complied with all agreements and conditions required by this Agreement to be
performed or complied with by them prior to or at the Closing.
7.4 No Threatened or Pending Litigation. On the Closing Date, no suit,
action or other proceeding, or injunction or final judgment relating thereto,
shall be threatened or be pending before any court or governmental or regulatory
official, body or authority in which it is sought to restrain or prohibit or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation that
might result in any such suit, action or proceeding shall be pending or
threatened.
7.5 Approval of Counsel; Corporate Matters. All actions, proceedings,
resolutions, instruments and documents required to carry out this Agreement or
incidental hereto and all other related legal matters shall have been approved
on the Closing Date by Counsel for SELLER in the exercise of their reasonable
judgment. PURCHASER shall also have delivered to SELLER such other documents,
instruments, certifications and further assurances as such counsel for SELLER
may reasonably required.
7.6 Audit Completed. The audit of the books, records, and Financial
Statements of the SELLER is completed and is delivered at Closing; the Parties
agree to share equally in the cost of such audit.
7.7 That Star Services Group, Inc. become a publicly traded corporation
on a national stock exchange and have its stock traded for at least ten (10)
trading days.
7.8 That SELLER reviews and approves PURCHASER's insurance policies for
claims relating to PURCHASER's officers and directors and business coverages.
ARTICLE VIII - INDEMNIFICATION
8.1 General Indemnification Obligation of SELLER.
8.1.1. From and after the Closing and for a period of one (1)
year, SELLER will reimburse, indemnify and hold harmless PURCHASER, its
subsidiaries and its successors and assigns (an "Indemnified Purchase Party")
against and in respect of:
(a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified PURCHASER Party that
result from, relate to or arise out of:
(i) any and all transactional liabilities and
transactional obligations of
13
14
SELLER of any nature whatsoever, except for those
transactional liabilities and transactional obligations of
SELLER which Purchaser assumes pursuant to this Agreement;
(ii) any and all actions, suits, claims, or legal,
administrative, arbitration, governmental or other proceedings
or investigations against any Indemnified PURCHASER Party that
relate to SELLER in which the principal event giving rise
thereto occurred prior to the Closing Date or which result
from or arise out of any action or inaction prior to the
Closing Date of SELLER or any director, officer, or employee
of SELLER, except for those which PURCHASER specifically
assumes pursuant to this Agreement; or
(iii) any material misrepresentation, or material
breach of warranty on the part of SELLER under this Agreement,
or from any material misrepresentation in or omission from any
certificate, schedule, statement, document or instrument
furnished to PURCHASER pursuant hereto or in connection with
the negotiation, execution or performance of this Agreement;
and
(b) any and all actions, suits, claims, proceedings,
investigations, demands, assessments, audits, fines, judgments, costs and other
expenses (including, without limitation, reasonable legal fees and expenses)
incident to any of the foregoing or to the enforcement of this Section 8.1.
8.1.2 To the extent any portion of the purchase price is
distributed to the SELLER's shareholders and to the extent the assets of the
SELLER are insufficient to pay such indemnity, then such shareholders will be
liable for the indemnity provided in Section 8.1.1. only to the extent of the
amount of the net distribution (exclusive of taxes) such shareholder receives.
8.1.3 To the extent PURCHASER has insurance coverage for any
claims that may fall within the scope of the indemnity provided in Section
8.1.1. PURCHASER agrees to waive all rights to the indemnity from the SELLER and
the shareholders to the extent of such insurance, regardless of rights of
subrogation of the insuror.
8.2 General Indemnification Obligation of PURCHASER.
From and after the Closing, PURCHASER will reimburse,
indemnify and hold harmless SELLER, and its shareholders (an "Indemnified SELLER
Party") against and in respect of:
(a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified SELLER Party that
result from, relate to or arise out of:
(i) any and all liabilities and obligations of SELLER
which have been assumed by PURCHASER to this Agreement;
(ii) any misrepresentation, breach of warranty or
non-fulfillment of any agreement or covenant on the part of
PURCHASER under this Agreement, or
14
15
from any misrepresentation in or omission from any
certificate, schedule, statement, document or instrument
furnished to SELLER pursuant hereto or in connection with the
negotiation, execution or performance of his Agreement; and
(b) any and all actions, suits, claims, proceeding,
investigations, demands, assessments, audits, fines, judgments, costs and other
expenses (including, without limitation, reasonable legal fees and expenses)
incident to any of the foregoing or to the enforcement of this Section 8.2.
(c) any sales, use, documentary, intangible, or other tax or
fee owed by SELLER or resulting from the transaction or the conduct of the
Business prior to Closing or resulting from this transaction.
8.3 Other Rights and Remedies Not Affected. The indemnification rights
of the parties under this ARTICLE VIII are independent of and in addition to
such rights and remedies as the parties may have at law or in equity or
otherwise for any misrepresentation, breach of warranty or failure to fulfill
any agreement or covenant hereunder on the part of any party hereto, including
without limitation the right to seek specific performance, rescission or
restitution, none of which rights or remedies shall be affected or diminished by
this Article, but which may be affected by other provisions of this Agreement.
ARTICLE IX - POST CLOSING MATTERS
9.1 Discharge of Obligations. From and after the Closing Date SELLER
shall pay and discharge, in accordance with past practice but not less than on a
timely basis, all obligations and liabilities incurred prior to the Closing Date
with respect to the assets which SELLER retains, including without limitation
any liabilities or obligations to employees, trade creditors and clients (except
for those assumed by PURCHASER).
9.2 Maintenance of Books and Records. SELLER AND PURCHASER shall
preserve until the second anniversary of the Closing Date all records possessed
or to be possessed by such party relating to any of the assets, liabilities or
business of the business prior to the Closing Date. After the Closing Date,
where there is a reasonable and legitimate purpose, such party shall provide the
other parties with access to the books and records, upon prior reasonable
written request specifying the need therefor, during regular business hours.
9.3 Payment Received. SELLER and PURCHASER agree that after the Closing
they will hold and will promptly transfer and deliver to the other, from time to
time as and when received by them, any cash, checks with appropriate
endorsements (using its best efforts not to convert such checks into cash), or
other property that it may receive on or after the Closing which properly
belongs to the other party, including without limitation any insurance proceeds,
and will account to the other for all such receipts. From and after the Closing,
PURCHASER shall have the right and authority to endorse checks payable to SELLER
for accounts receivables bought by PURCHASER.
15
16
9.4 Post Closing Matters. From and after the closing Date, SELLER will
promptly refer all inquiries with respect to ownership of the Assets to
PURCHASER. In addition, SELLER will execute such documents and financing
statements as PURCHASER may request from time to time to evidence transfer of
the Assets to PURCHASER, including any necessary assignments of financing
statements.
9.5 Assumption. PURCHASER shall perform and discharge all of SELLER's
obligations and liabilities which are effectively assumed in accordance with
this Agreement. Among the payables being assumed by the PURCHASER are trade
payables to Delta Recycling Corp. in the approximate amount of Eighty Thousand
and No/100 Dollars ($80,000.00) and trade payables to Xxxxxx Trucking in the
approximate amount of Thirty Five Thousand and No/100 Dollars ($35,000.00), such
trade payables to be fixed as of the September 1, 1999 effective date. After the
purchase, these payables will be paid down on a proportionate basis as income
becomes available for payable reductions. SELLER also owes Xxxx Xxxxxxx Eight
Thousand Six Hundred Fifty Three and 87/100 Dollars ($8,653.87) in salary which
payroll payable is also being assumed by PURCHASER. This payable will be paid to
Xxxx Xxxxxxx in equal weekly amounts starting September 3, 1999 so that it is
paid off within six (6) months. For purposes of this Section 9.5, the owners of
such trade payables and Xx. Xxxxxxx' payable are intended beneficiaries, and
shall have standing and the power to enforce the terms of this Section 9.5
against PURCHASER.
9.6 Delta Recycling Corp.'s Conditional Guarantee of Xxxxxx'x Debt.
Mario's Equipment Rental, Inc. owes Xxxx Xxxxxx Seventy-Five Thousand and No/100
Dollars ($75,000.00) which is evidenced by a Promissory Note, and which is being
repaid at a rate of One Thousand Five Hundred and No/100 Dollars ($1,500.00) per
week. This Note shall be guaranteed by Delta Recycling Corp. in the event Xxxx
Xxxxxx'x Employment Agreement is terminated under the provisions of paragraphs
10(a), (c), (d), or (e) of his Employment Agreement. For this reason, Delta
Recycling Corp. is executing this Agreement.
ARTICLE X - MISCELLANEOUS
10.1 Termination.
(a) Anything herein or elsewhere to the contrary
notwithstanding, this Agreement may be terminated by written notice of
termination at any time before the Closing Date only as follows:
(i) by mutual consent of SELLER and PURCHASER;
(ii) by PURCHASER, (A) at any time if the representations and
warranties of SELLER contained in this Agreement were incorrect in any
material respect when made or at any time thereafter, or (B) upon
written notice to SELLER given at any time prior to the Closing Date
(or such later date as shall have been specified in a writing
authorized on behalf of SELLER AND PURCHASER) if all of the conditions
precedent set forth in this Agreement are not satisfied;
16
17
(iii) by Seller, (A) at any time if the representations and
warranties of PURCHASER contained in this Agreement hereof were
incorrect in any material respect when made or at any time thereafter,
or (B) upon written notice to PURCHASER given at any time prior to the
Closing Date (or such later date as shall have been specified in a
writing authorized on behalf of SELLER AND PURCHASER) if all of the
conditions precedent set forth in this Agreement are not satisfied.
(b) In the event of the termination and abandonment hereof
pursuant to the provisions of this Section 10.1, then this Agreement (except
Section 5.5 and the right to seek damages and equitable relief for its
enforcement) shall become void and have no effect, without any liability on the
part of any of the parties or their directors or officers or stockholders in
respect of this Agreement, unless the termination was the result of the
representations and warranties of a party being materially incorrect when made
or the material breach by such party of a representation or warranty and a
consequent termination prior to closing, whereupon, the one who made such
incorrect representation and warranty (or committed such pre-closing breach)
shall be liable to the other party for all costs and expenses of the other party
in connection with the preparation, negotiation, execution and performance of
this Agreement up to a maximum of Five Thousand and No/100 Dollars ($5,000.00).
10.2 Headings. The headings in this Agreement are solely for
convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
10.3 Further Actions. At any time and from time to time, each party
agrees, at its or their expense, to take such actions and to execute and deliver
such documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
10.4 Availability of Equitable Remedies. Since a breach of the
provisions of this Agreement could not adequately be compensated by money
damages, any party shall be entitled, either before or after the Closing, in
addition to any other right or remedy available to it, to an injunction
restraining such breach or a threatened breach and to specific performance of
any such provision of this Agreement.
10.5 Survival. The covenants, agreements, representations, and
warranties contained in or made pursuant to this Agreement by all parties shall
survive the Closing for a period of one (1) year. The statements contained in
any document executed by SELLER, relating hereto or delivered to the PURCHASER
in connection with the transactions contemplated hereby or thereby, or in any
statement, certificate, or other instrument delivered by or on behalf of SELLER,
pursuant hereto or thereto or delivered to the PURCHASER in connection with the
transactions contemplated hereby or thereby shall be deemed representations and
warranties, covenants and agreements, or conditions, as the case may be, for all
purposes of this Agreement.
10.6 Modification. This Agreement and the Exhibits hereto set forth the
entire understanding of the parties with respect to the subject matter hereof,
supersede all existing agreements among them concerning such subject matter, and
may be modified only by a written instrument duly executed by each party.
17
18
10.7 Notices. Any notice or other communication required or permitted
to be given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested or by Federal Express, Express Mail, or similar
overnight delivery or courier service or delivered (in person or by telecopy,
telex, or similar telecommunications equipment) against receipt to the party to
whom it is to be given at the address of such party set forth in the preamble to
this Agreement (or to such other address as the party shall have furnished in
writing in accordance with the provisions of this Section 10.8) with a copy to
each of the other parties hereto. Any notice given to any corporate party shall
be addressed to the attention of the Corporate Secretary. Notice to the estate
of any party shall be sufficient if addressed to the party as provided in this
Section 10.08. Any notice or other communication given by certified mail shall
be deemed given at the time of certification thereof, except for a notice
changing a party's address which will be deemed given at the time of receipt
thereof. Any notice given by other means permitted by this SECTION 10.7 shall be
deemed given at the time of receipt thereof.
10.8 Waiver. Any waiver by any party of a breach of any term of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of that term or of any breach of any other term of this Agreement. The
failure of a party to insist upon strict adherence to any term of this Agreement
on one or more occasions will not be considered a waiver or deprive that party
of the right thereafter to insist upon strict adherence to that term or any
other term of this Agreement.
10.9 Binding Effect. The provisions of this Agreement shall be binding
upon and inure to the benefit of SELLER, AND PURCHASER, and their respective
successors and assigns and shall inure to the benefit of each Indemnitee and its
successors and assigns (if not a natural person) and his assigns, heirs, and
personal representatives (if a natural person).
10.10 No Third Party Beneficiaries. Except as provided herein, this
Agreement does not create, and shall not be construed as creating, any rights
enforceable by any person not a party to this Agreement.
10.11 Separability. If any provision of this Agreement is invalid,
illegal, or unenforceable, the balance of this Agreement shall remain in effect,
and if any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances. If,
however, the clause determined to be invalid materially affects the performance
of the parties, or materially impacts the parties' expectations or positions
with respect to the Agreement, the parties will negotiate in good faith to
modify the Agreement in some fashion so as to, as near as possible, place the
parties in the same position they were in, vis-a-vis, their intent, performance
expectations, and economic position.
10.12 Counterparts; Governing Law. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Florida,
without giving effect to conflict of laws.
10.13 Dispute Resolution. All claims, counterclaims, disputes, and
other matters in question between the parties arising out of, relating to, or
pertaining to this Agreement shall be determined by litigation in the Circuit
Court of the Seventeenth Judicial Circuit in and for
18
19
Broward County, Florida, or the Federal District Court of the Southern District
of Florida and appropriate appellate courts for such venue and jurisdiction. In
the event of any litigation which arises out of, pertains to, or relates to this
Agreement, the prevailing party shall be entitled to recover a reasonable
attorney's fee from the non-prevailing party, subject to the limits of this
paragraph. Where the prevailing party is awarded compensatory damages from the
non-prevailing party, the amount of attorney's fees shall not exceed the amount
of compensatory damages or Two Hundred Fifty Thousand and No/100 Dollars
($250,000.00), whichever is less (it being the intent that no attorney's fees
shall be recoverable by a prevailing party in the absence of an award of
compensatory damages). If no compensatory damages are awarded, the prevailing
party is entitled to a reasonable attorney's fee for the defense of the
non-prevailing party's claim, not to exceed Two Hundred Fifty Thousand and
No/100 Dollars ($250,000.00).
10.14 Notwithstanding anything to the contrary, the SELLER's maximum,
cumulative liability under this Agreement shall not exceed the purchase price.
IN WITNESS WHEREOF, the Parties hereto have this day set their
hand and seal.
MARIO'S EQUIPMENT RENTAL, INC.
By:
-----------------------------------------
Xxxx Xxxxxx, President
Approved:
By:
-----------------------------------------
Xxxxx Xxxxxxxxxx
DELTA SITE DEVELOPMENT CORP.
By:
-----------------------------------------
Xxxxxxx X. Xxxxxxx, President
STAR SERVICES GROUP, INC.
By:
-----------------------------------------
Xxxxxxx X. Xxxxxxx, President
DELTA RECYCLING CORP.
By:
-----------------------------------------
Xxxxxxx X. Xxxxxxx, President
19
20
SCHEDULE 1.1
(PAGE 1 OF 2)
ASSETS:
1. See Equipment List attached dated 8/13/99
2. Cash = $5,993.43
3. Accounts Receivable = $169,783.99
4. Employee Loans = $2,413.00
5. Deposits Receivable (F.D.O.T. toll card) = $300.00
6. Goodwill
7. Covenant Not to Compete
LIABILITIES:
1. Trade Accounts Payable = $176,511.40
2. Loan Payable to Xxxxxx Trucking that Xxxx Xxxxxx guaranteed at 9/1/99 =
$75,000.00
3. Loans Payable on purchased Equipment (see attached Equipment List dated
8/13/99 and Finance Agreements)
4. Payroll Payable to Xxxx Xxxxxxx = $8,563.87
NOTE: ALL FIGURES PROVIDED ARE EFFECTIVE AS OF 9:30 A.M. ON AUGUST 19, 1999.
20
21
SCHEDULE 1.1
(PAGE 2 OF 2)
MARIO'S EQUIPMENT RENTAL
ALLOCATION OF PURCHASE PRICE
Restricted Stock subject to Marketability Discount by Seller $300,000.00
Promissory Note $200,000.00
-----------
TOTAL PURCHASE PRICE $500,000.00
===========
Goodwill $458,000.00
Covenant not to Compete $ 10,000.00
Equipment $397,000.00
Less Debt ($365,000.00)
------------
$ 32,000.00
-----------
TOTAL $500,000.00
===========
21
