Exhibit 2.1
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ASSET PURCHASE AGREEMENT
between
XXX XXXX-XXXXXX, INC.
as Purchaser
and
FIRST AID SELECT, INC.
as Seller
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Effective
December 20, 1999
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made this
16th day of December, 1999, between FIRST AID SELECT, INC., a Florida
corporation (the "Seller"), and XXX XXXX-XXXXXX, INC. (the "Purchaser").
RECITALS
A. Seller is engaged in the retail/route sales of first aid and safety
supplies.
B. Purchaser desires to purchase from Seller, and Seller desires to
sell to Purchaser, upon the terms and conditions specified herein, all of the
Purchased Assets, as defined herein, of such business.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals, and in
consideration of the promises, covenants, terms and conditions specified herein,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
For all purposes of this Agreement, the following defined terms shall
have the meanings set forth in this Article I:
1.1 "Accounts Receivable" means all of the monies owed to the Seller by
its customers of the Business, including by way of example, but not limitation,
current receivables, delinquent receivables and finance charges.
1.2 "Business" means the First Aid Supply Business conducted by Seller
prior to the Closing Date.
1.3 "Closing" means the actions taken as provided in Article VI in
connection with the consummation of the transactions contemplated by this
Agreement.
1.4 "Closing Date" means the time and date when the Closing of the
transactions contemplated by this Agreement shall be effective, which shall be
12:01 a.m. on December 20, 1999.
1.5 "Code" means the Internal Revenue Code of 1986, as amended.
1.6 "Contracts" means all written or oral contracts, agreements,
commitments and orders (including but not limited to Customer Contracts,
purchase orders, Leases and license agreements) of Seller in the Business, but
does not include any contracts, agreements or arrangement for or in regard to
leased employees.
1.7 "Customer Contracts" means all or oral written contracts,
agreements, commitments and orders from customers of the Business.
1.8 "Encumbrance" means any mortgage, pledge, security interest, lien,
claim, charge, encumbrance, option, lease, restriction or restraint on transfer.
1.9 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
1.10 "ERISA Plan" means any and all employee pension benefit plans (as
defined in Section 3(2) of ERISA) and any and all employee welfare benefit plans
(as defined in Section 3(1) of ERISA).
1.11 "Financial Statements" means the financial statements of the
Seller, including a balance sheet and statement of income and expenses as at
December 31, 1998 and as at September 30, 1999.
1.12 "First Aid Supply Business" means Seller's retail van delivery
first aid and safety supply business.
1.13 "Inventory" means all of Seller's inventory and salable goods used
in the Business valued at their cost to retailers and which is physically
located in the Seller's retail delivery vehicles as determined by a physical
inventory of such by Seller and Purchaser as of the Closing Date.
1.14 "Lease" means any lease, sublease or rental agreement by which
Seller leases or rents any real property or other tangible property as lessee.
1.15 "Litigation" means claims, suits, actions, investigations or
proceedings.
1.16 "Name" means First Aid Direct.
1.17 "Permits" means licenses, qualifications, permits, approvals,
franchises, zoning variations and authorizations (federal, state and local) used
in the Business.
1.18 "Purchase Price" means the sum of $350,000.
1.19 "Purchased Assets" means all of the following assets of Seller
used in the Business as of the Closing Date:
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(a) Seller's equipment, machinery, furniture, fixtures and other
personal property listed on Schedule 3.4.
(b) The motor vehicles specifically listed and identified (by serial
number or otherwise) on Schedule 3.4.
(c) The Inventory.
(d) The Accounts Receivable.
(e) The right to use the Name only with respect to retail sales of
first aid and safety supplies.
(f) All of Seller's right, title, and interest in and to all Contracts.
(g) All of Seller's Permits.
(h) All of Seller's Records.
The Purchased Assets do not, however, include Seller's cash and bank
deposits of the Business.
1.20 "Records" means all books and records of Seller used in the
Business, including without limitation, all of its property and equipment
records, production records, engineering records, purchasing and sales records,
personnel and payroll records, accounting records, magnetic copies of computer
files and documentation, all customer lists and other records and files kept or
used by Seller in the ordinary course or conduct of the Business, but not
including Seller's tax returns, minute books or shareholder records.
1.21 "Taxes" means corporate taxes, franchise taxes, sales taxes, use
taxes, real property taxes, personal property taxes, state business taxes,
federal, state and local income taxes, FICA taxes and FUTA taxes, other payroll
taxes and all related assessments, charges, duties, deficiencies, penalties,
interest and fines.
1.22 "Vehicle Loans" means the Encumbrances against the motor vehicles
listed and identified on Schedule 3.4.
ARTICLE II
PURCHASE AND SALE
2.1 Purchase and Sale. As of the Closing Date, upon the terms, subject
to the conditions, and for the consideration hereinafter set forth, Seller shall
sell,
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convey, assign, transfer and deliver all of the Purchased Assets to Purchaser by
such appropriate bills of sale, conveyances, assignments or other instruments of
transfer as may be reasonably requested by counsel for Purchaser.
2.2 Purchase Price. Purchaser shall pay to Seller the Purchase Price
for the Purchased Assets by wire transfer on December 20, 1999.
2.3 Allocation of Purchase Price. The purchase price shall be allocated
as follows:
Accounts Receivable Book Value
Tangible Fixed Assets Book Value
Inventory Wholesale Price to Customers
Customer Contracts
and Goodwill Balance of Purchase Price
2.4 Payment of Purchase Price. Purchaser shall pay the Seller the
Purchase Price at the Closing by wire transfer of immediately available funds to
such bank account as Seller may specify in writing to Purchaser at least five
days prior to the Closing.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser as of the date of this
Agreement and as of the Closing Date as follows:
3.1 Power and Authority.
Seller is a corporation duly organized, validly existing and in
good standing under the laws of the State of Florida and has full power and
authority to carry on the Business as it is presently conducted, and to own,
lease and operate the Purchased Assets. Seller is not required to be qualified
or licensed to do business in any other state or jurisdiction with respect to
the Business where such failure would have a material adverse effect on the
Business.
3.2 Execution and Delivery. The execution, delivery and performance of
this Agreement by Seller, and the consummation of the transactions contemplated
by this Agreement, will not:
(a) violate, result in a breach of any of the terms or conditions of,
or constitute a default under, the Articles of Incorporation or By-Laws or
similar documents of Seller, or under any contract, agreement, commitment,
undertaking, understanding, note, bond, license or other instrument or
obligation to which Seller
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is a party, or by which any of the Purchased Assets may be bound or affected, or
which would adversely affect the value of the Purchased Assets or the ability of
Seller to transfer good title to and possession of the same to Purchaser; or
(b) violate or conflict with any applicable law, judgment, order, writ,
injunction or decree of any court, administrative agency or governmental body
applicable to Seller.
3.3 Capacity and Authority. Seller has full corporate capacity, power
and authority to enter into this Agreement, and to carry out the transactions
contemplated by this Agreement. The Board of Directors and shareholders of
Seller have duly authorized, and Seller has taken all necessary action to
authorize, the execution, delivery and performance of this Agreement by Seller
and the consummation of the transactions contemplated by this Agreement by
Seller. The obligations of Seller set forth in this Agreement are legal, valid
and binding obligations of Seller enforceable in accordance with their terms.
3.4 Title to and Condition of Properties.
(a) Set forth in Schedule 3.4 is a list of all tangible assets and
property of Seller included in the Purchased Assets having a fair market value
of $500 or more (other than Inventory) and all motor vehicles included in the
Purchased Assets. Except as set forth in Schedule 3.4, Seller has good, valid
and marketable title to all the Purchased Assets, free and clear of all
Encumbrances except for such imperfections or encumbrances which would not have
a material adverse effect on the Purchased Assets, and except for the Vehicle
Loans. At the Closing Seller shall transfer to Purchaser good, valid and
marketable title to each of the Purchased Assets, free and clear of
Encumbrances. The Vehicle Loans are current and no payment or liability
thereunder is in arrears as of the Closing Date.
(b) As of the Closing Date, the equipment, machinery and motor vehicles
included in the Purchased Assets are in good condition and working order,
subject to normal wear and tear in accordance with past experience.
(c) To the best of Seller's knowledge, the Inventory is adequate and
suitable as of the Closing Date for the conduct of the Business as conducted by
Seller, and the quality, quantity and mix is consistent with prior business
practices of the Seller and will be in such condition to be readily saleable at
standard prices.
3.5 Taxes. With respect or relating to the Business, and its business
operations in connection therewith:
(a) Seller has paid or shall timely pay all Taxes due and payable by it
or to become due and payable by it; and
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(b) Seller shall pay, and shall be solely responsible for, all Taxes
(foreign, federal, state and local) which have accrued or will accrue by virtue
of the consummation of this transaction including by way of example but not
limited to any transfer, sales or use tax and no tax lien has attached or will
attach to any of the Purchased Assets by reason of the consummation of this
transaction or by reason of any activity of Seller prior to the Closing Date.
3.6 Material Events. Since December 31, 1998, there has not been any
material occurrence, event, change in business, financial, or accounting
practices, damage, destruction, or loss, or any other condition or event which
has or would materially adversely affect the properties, assets or business
operations of the Business.
3.7 Compliance with Laws. Seller is in compliance, in all material
respects, with all applicable laws, rules, regulations, ordinances and standards
including, but not limited to, environmental, civil rights, occupational safety
and health and hazardous substances with respect to the Business.
3.8 Licenses, Permits, Etc. Set forth in Schedule 3.8 is a complete and
accurate list of all Permits held by or granted to Seller which are in effect as
of the date of this Agreement and which are materially necessary to the conduct
of the Business. Seller possesses all Permits applicable to Seller which are
necessary for the conduct of the Business as heretofore conducted or the
operation of the Purchased Assets. All such Permits are now, and as of the
Closing Date will be, in full force and effect without modification. Except as
described in Schedule 3.8, all such Permits may be, and on the Closing will be,
effectively transferred or assigned to Purchaser without the consent of any
government agency so as to allow Purchaser to operate the Purchased Assets and
Business in substantially the same manner as they are currently being operated
except where such Permits are not assignable or require the Purchaser's actions
to remain in force. No violation of any such Permit has been recorded and no
proceeding which might result in revocation or limitation thereof is pending or,
to the best of the Seller's knowledge, threatened.
3.9 Litigation. Except as disclosed on Schedule 3.9:
(a) there is no Litigation pending or, to the best of Seller's
knowledge, threatened against, or affecting, the Purchased Assets or the
Business, by any person or entity, including, but not limited to, any
administrative agency, arbitrator or governmental body; and
(b) there is no outstanding order, writ, injunction or decree of any
court, administrative agency, governmental body or arbitration tribunal against
or affecting the Purchased Assets or the Business.
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3.10 Financial Statements. Seller has delivered to Purchaser true and
complete copies of the Financial Statements. The Financial Statements have been
prepared in conformity with general accepted accounting principles consistently
applied and are a fair, accurate and complete representation of the financial
position of the Business, the results of the Business's operations, and the
related changes in its financial position as of the respective dates thereof and
for the periods then ended. The Financial Statements are substantially in
accordance with the books and records of Seller.
3.11 Contracts.
(a) Set forth on Schedule 3.11 is a complete list of all Contracts of
Seller pertaining to the Business which involve: (i) payments or financial
obligations of $10,000 or more, (ii) which are not terminable by Seller without
cause and without expense or liability to Seller on notice of 30 days or less,
or (iii) matters that are material to the Business. No other contract,
agreement, commitment or order is necessary for Purchaser to conduct the
Business substantially as it is presently conducted. True and complete copies of
all such Contracts will have been furnished to Purchaser by Seller prior to the
Closing.
(b) Except as set forth in Schedule 3.11, each of such Contracts may be
assigned to Purchaser pursuant to this Agreement without any breach, default,
acceleration or termination thereof, and all of the rights of Seller under the
same shall upon assignment to Purchaser pursuant to this Agreement be
enforceable by Purchaser after the Closing Date, without the consent or
agreement of any other person, except such consents as are hereafter obtained by
Seller without any adverse effect upon Purchaser, the Purchased Assets, and/or
the business operations conducted by Purchaser with the Purchased Assets after
the Closing.
(c) The Seller has not received any notice of default with respect to
any Contracts. There are no facts or conditions which have occurred which would
(either with notice or lapse of time, or both) constitute a default with respect
to any Contracts by the Seller, or which would cause the acceleration of any
obligation of Seller to the same.
(d) There are no persons holding powers of attorney from Seller.
(e) To the best of Seller's knowledge, no Contract calls for the
leasing or purchasing by Seller of any premises, goods or services at prices
substantially in excess of prevailing market prices on the Closing Date or, to
the best of Seller's knowledge, the leasing or sale by Seller of any premises,
goods, or services at prices substantially below prevailing market prices on the
Closing Date.
3.12 Customers. Attached as Schedule 3.12 is a true and complete list
of all of the Seller's customers of the Business as of the Closing Date. Such
list shall
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include the name and address of each customer and the amount of purchases of
each customer for the six month period ending ten days prior to the Closing.
Except as set forth in Schedule 3.12, to the best of Seller's knowledge, no
customer on Seller's customer and route lists is planning to or has threatened
to terminate its business relationship with the Business.
3.13 Employment Agreements and Employee Benefit Plans.
(a) Set forth in Schedule 3.13 is a complete list of all employment
agreements, deferred compensation agreements, incentive and bonus plans, ERISA
Plans and other fringe benefits presently in effect covering any employees of
Seller employed in the Business and the categories of employees covered by each
such agreement, contract, plan or program, and all accrued but unpaid
contributions, premiums or other payments attributable to each such agreement,
contract, plan or program. Except as specifically set forth in Schedule 3.13,
neither Seller nor any entity related to Seller (as defined in Section 4001 of
ERISA) has contributed, is contributing, was obligated to contribute at any time
in the past, or is obligated to contribute (now or in the future) to any
multi-employer pension plan (as defined in Section 3(37) of ERISA).
(b) Seller, as to employees employed in the Business, (i) has not
announced or committed itself to changes in any employment agreement, deferred
compensation agreement, incentive plan, bonus plan, fringe benefits and ERISA
Plans presently in effect (ii) has not announced or committed itself to adopt
any new agreement, contract, plan or program to provide new employee benefits or
fringe benefit programs or to expand or modify existing programs; and (ii) is
not required, by agreement or otherwise, to alter any such agreement, contract,
plan or program. Seller has provided Purchaser with true, correct and complete
copies of all agreements, plan and trust documents, employee communications,
insurance contracts, summary plan descriptions and, if applicable, filings with
the Department of Labor and Internal Revenue Service, including Treasury Forms
5500 for the most recent three years, relating to all agreements and plans
listed in Schedule 3.13 which Purchaser has requested.
3.14 ERISA Compliance. No act, omission, or event has occurred which
could be expected to give rise to a prohibited transaction under Section 406 of
ERISA or to a breach of fiduciary duty or any cause of action under Section 502
of ERISA with respect to any agreement, contract, plan or program listed in
Schedule 3.13. No agreement, contract, plan or program listed in Schedule 3.13
is currently subject to any audit or Litigation in a state or federal court or
before any arbitrator or government agency, and no fiduciary or party in
interest (as defined under ERISA), with respect to any such agreement, contract,
plan or program is involved in any Litigation (either pending or threatened)
involving the administration of or payment of benefits under any such agreement,
contract, plan or program. All agreements, contracts, plans or programs listed
in Schedule 3.13 have been administered in
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compliance with their governing documents, applicable law and government
regulations.
3.15 Employment Practices. Schedule 3.15 sets forth the name, title or
responsibility, and annual rate of compensation of each employee of Seller
employed in the Business. Schedule 3.15 also sets forth, as of the Closing Date,
the seniority and unused vacation and sick time of each such employee of Seller.
Seller has paid in full to its employees employed in the Business all wages,
salaries, commissions, bonuses and other direct compensation for all services
performed by them, other than amounts which have not yet become payable in
accordance with Seller's customary practices. Seller is not a party to any
collective bargaining contract or other agreement with any labor union. No
organizing efforts, labor trouble or strike exists or, to the best of Seller's
knowledge, is threatened which could adversely affect the Business.
3.16 Insurance; Workers' Compensation. Set forth on Schedule 3.16 is a
list of liability and property insurance policies maintained by Seller in the
Business and the balance of any premiums due thereon. To the best of Seller's
knowledge, no notice of suspension or cancellation of any insurance policies
currently maintained by Seller has been received by Seller or, to the best of
Seller's knowledge, is threatened. Seller maintains workers' compensation
insurance with limits not less than those required under the laws of each state
to which it is subject, or is a certified self-insurer under such laws. All
workers' compensation insurance maintained by Seller is in full force and
effect, and no payments with respect thereto are past due. Schedule 3.16
contains a list of all awards of workers' compensation benefits granted against
Seller or with respect to employees involved in the Business since January 1,
1994.
3.17 Brokerage and Finder's Fees. Seller has not incurred any liability
or obligation to any finder or agent for any brokerage fees, finder's fees or
commissions with respect to the transactions contemplated by this Agreement.
3.18 Customer Accounts. Seller does not presently owe any customer or
customer account of the Business any sum of money or other consideration
whatsoever to secure or retain the patronage of such customer or customer
account.
3.19 Use of Name; No Infringement. Seller has the right to use the Name
in the Business and to transfer the right to use the Name to Purchaser in
accordance with this Agreement free and clear of any Encumbrances. Seller has
filed a trademark application with the U.S. Patent and Trademark Office for the
Name. The Seller has not received any notice that Seller in the operation of the
Business is infringing or violating any patent, trademark, service xxxx,
copyright or other intellectual property right of any third party and, to the
best of Seller's knowledge, there is no basis for any such claim.
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3.20 Consents and Approvals. Except as set forth on Schedule 3.20, no
consent, approval, waiver, authorization, registration or qualification is
required to be obtained by the Seller from, and no notice or filing is required
to be given by the Seller to or made by the Seller with, any governmental
authority or other third-party in connection with the execution, delivery and
performance by the Seller of the terms of this Agreement.
3.21 Full Disclosure. No representation or warranty of the Seller
contained in this Agreement (including any Exhibit or Schedule attached hereto)
contains or will knowingly contain any untrue statement of a material fact, or
omits or will omit to state a material fact necessary to make the statements
contained in this Agreement not misleading. In purchasing the Purchased Assets,
Purchaser is relying upon the truth and accuracy of each of the foregoing
representations and warranties, and as stated in this Article III, each of the
same constitutes a basic and bargained for consideration for such purchase by
Purchaser.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to the Seller as of the date hereof
and as of the Closing Date, as follows:
4.1 Power and Authority. Purchaser is a corporation duly organized,
validly legally existing and in good standing under the laws of the state of
Ohio and is qualified to do business in the State of Florida.
4.2 Execution and Delivery. The execution, delivery and performance of
this Agreement by Purchaser, and the consummation of the transactions
contemplated by this Agreement contemplated hereby, will not:
(a) violate, result in a breach of any of the terms or conditions of,
or constitute a default under, the Articles of Incorporation or Code of
Regulations of Purchaser, or under any contract, agreement, commitment,
undertaking, understanding, note, bond, license or other instrument or
obligation to which Purchaser is a party, or by which any of the properties or
assets of Purchaser may be bound or affected; or
(b) violate or conflict with any applicable law, judgment, order, writ,
injunction or decree of any court, administrative agency or governmental body
applicable to Purchaser.
4.3 Capacity and Authority. Purchaser has full capacity, power and
authority to enter into this Agreement, and to carry out the transactions
contemplated by this Agreement. Purchaser has taken all necessary action to
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authorize the execution and delivery of this Agreement and the consummation of
the transactions contemplated by this Agreement. The obligations of Purchaser
set forth in this Agreement are legal, valid and binding obligations of
Purchaser, enforceable in accordance with their terms.
4.4 Brokerage and Finder's Fees. Purchaser has not incurred any
liability or obligation to any finder or agent for any brokerage fees, finder's
fees or commissions with respect to the transactions contemplated by this
Agreement.
ARTICLE V
NO ASSUMPTION OF LIABILITIES BY PURCHASER; WAIVER OF BULK SALES
5.1 No Assumption of Liabilities. Notwithstanding any other term or
provision of this Agreement, except for the Vehicle Loans on the motor vehicles
listed and identified on Schedule 3.4 and as provided in Section 2.5 of this
Agreement, Purchaser does not assume and shall not be responsible for, any
liability, commitment or obligation of Seller, including, without in any way
limiting the generality of the foregoing, (1) any employment responsibilities or
obligations of Seller, (2) any obligations and liabilities of Seller under any
collective bargaining or labor agreements, (3) any obligation or liability of
Seller arising out of the sponsorship or administration of any ERISA Plan, (4)
any accounts payable, loans or other liabilities which are not otherwise assumed
by Purchaser pursuant to this Agreement, (5) any claims, suits, actions or
Litigation filed prior to the Closing Date, (6) liabilities or obligations to be
paid or performed prior to the Closing Date under the Contracts, (7) any
obligation or liability of Seller with respect to vacation or sick pay or any
other employment obligations of Seller, and/or (8) any product liability, breach
of warranty or similar liability. Seller shall be solely responsible for all
liabilities and obligations and arising out of the operation of the Business or
the ownership, lease or use of the Purchased Assets prior to the Closing Date.
All periodic obligations of the Business for utilities, rental of personal
property or similar obligations that apply to time periods beginning before and
ending after the Closing Date shall be pro-rated on a daily basis between Seller
and Purchaser.
5.2 Waiver of Bulk Transfers Law. The parties waive compliance with the
provisions of the Bulk Sales Law of any state, and Seller warrants and agrees to
pay and discharge when due all claims of creditors which could be asserted
against Purchaser by reason of such noncompliance. Seller agrees to pay at or
before the Closing all trade payables pertaining to the Business and the
Purchased Assets, or according to terms if such terms extend beyond Closing, and
all sales, withholding, property and other taxes due to the State of Florida or
any other taxing jurisdiction.
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ARTICLE VI
CLOSING
6.1 Time and Place. The Closing of the transactions contemplated by
this Agreement will take place at the offices of Atlas, Xxxxxxxx, Trop &
Borkson, P.A. on December 16, 1999, or such other place and time as the parties
may agree, and shall be effective as of the Closing Date.
6.2 Deliveries by Seller. At the Closing, Seller will, subject to the
satisfaction of the conditions set forth in Article IX, deliver to Purchaser:
(a) A Xxxx of Sale.
(b) Releases and UCC termination statements from any third party having
a security interest in all or a portion of the Purchased Assets or such other
evidence of termination of such security interests as is reasonably acceptable
to Purchaser.
(c) All other certificates, documents of title, bills of sale and other
instruments of conveyance and transfer, in form satisfactory to Purchaser and
Purchaser's counsel, as Purchaser's counsel shall deem necessary, to vest in
Purchaser good and marketable title to the Purchased Assets.
(d) Copies of all employment agreements with any of the Seller's
employees engaged in the Business.
6.3 Requirements Purchasing Agreement. The Requirements Purchasing
Agreement described in Article 9.3 shall be signed and delivered.
ARTICLE VII
COVENANTS OF THE PARTIES
7.1 Noncompetition Agreement.
(a) During the period of five years after the Closing Date, Seller
shall not, directly or indirectly (as an agent, contractor, consultant, partner,
member, shareholder, owner or otherwise):
(i) Own any interest (other than the ownership of less than 1%
of the outstanding stock of a publicly traded company) in, engage in
or otherwise participate in, whether for compensation or not, any
business that is involved in the First Aid Supply Business;
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(ii) Request or advise any customer of the Business conducted
by Purchaser to terminate or alter its business relationship with the
First Aid Supply Business, or otherwise interfere with the business
operations of the First Aid Supply Business; or
(iii) Induce or attempt to induce or influence any employee of
Purchaser to terminate employment with Purchaser.
(b) It is the intent of the parties that the provisions of this Section
7.1 shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, to the extent that the noncompetition restrictions under this
Agreement shall be adjudicated to be invalid or unenforceable in any such
jurisdiction, the court making such determination shall have the power to limit,
construe or reduce the duration, scope, activity and/or area of such provision,
and/or delete specific words or phrases to the extent necessary to render such
provision enforceable to the maximum reasonable extent permitted by applicable
law, such limited form to apply only with respect to the operation of this
Section in the particular jurisdiction in which such adjudication is made.
(c) Seller acknowledges that its adherence to the terms of the
covenants set forth in Section 7.1 is necessary to protect the value of the
Purchased Assets to Purchaser, that a continuing breach of such covenants will
result in irreparable and continuing damage to the value of the Purchased
Assets, and that money damages would not adequately compensate Purchaser for any
such breach and, therefore, that Purchaser would not have an adequate remedy at
law. In the event any action or proceeding shall be instituted by Purchaser to
enforce any provision of Section 7.1, Seller shall waive the claim or defenses
in such action that (i) money damages are adequate to compensate Purchaser for
such breach and (ii) there is an adequate remedy at law available to Purchaser,
and shall not urge in any such action or proceeding the claim or defense that
such remedy at law exists. Purchaser shall have, in addition to any and all
remedies at law, the right to an injunction, both temporary and permanent,
specific performance and/or other equitable relief to prevent the violation of
any obligation under Section 7.1. The parties agree that the remedies of
Purchaser for breach of Section 7.1 by Seller shall be cumulative, and seeking
or obtaining injunctive or other equitable relief shall not preclude the making
of a claim for damages or other relief. Seller also agrees that Purchaser shall
be entitled to such damages as it can show it has sustained by reason of such
breach and shall not be limited in its damages by any provision of, or to the
consideration received by Seller pursuant to, this Agreement. In any action
brought to enforce the covenants set forth in Section 7.1, or to recover damages
for breach thereof, the prevailing party shall be entitled to recover reasonable
attorneys' fees and other expenses of litigation, together with such other and
further relief as may be proper.
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(d) The parties intend to and do hereby confer jurisdiction to enforce
this Section 7.1 upon the courts of any state within the geographical scope of
the covenants contained in this Agreement. If the courts of any one or more of
such states or jurisdictions shall hold such covenant wholly unenforceable by
reason of the breadth of such scope or otherwise, it is the intention of the
parties that such determination shall not bar or in any way affect the right of
Purchaser to the relief provided above in the courts of any other state or
jurisdiction within the geographical scope of such covenant, as to breaches of
such covenants in such other respective states or jurisdictions; the above
covenants as they relate to each state or jurisdiction being, for this purpose,
severable into diverse and independent covenants.
7.2 Access to Records. Purchaser shall retain the Records for at least
six years. Seller or its agents shall have access to the Records, upon
reasonable notice and during normal business hours, at the Purchaser's Florida
office for legitimate business or tax purposes during such six year period.
ARTICLE VIII
CONDITIONS PRECEDENT TO CLOSING BY PURCHASER
Subject to waiver by Purchaser, each of the agreements of Purchaser to
be performed by it at the Closing pursuant to this Agreement shall be subject to
the fulfillment of each of the following conditions precedent:
8.1 Representations and Warranties. Each of the representations and
warranties of the Seller set forth in this Agreement shall be true, correct and
complete in all material respects on the date of this Agreement and on the
Closing Date, as if made at that time.
8.2 Agreements. Seller shall have performed and complied with all
agreements, undertakings, obligations and covenants which are required to be
performed or complied with by it at or prior to the Closing Date.
8.3 Closing Deliveries. Purchaser shall have received the items to be
delivered to it at Closing as described in Article 6.2.
8.4 Litigation. No notice shall have been received as to Litigation
being commenced or threatened against Purchaser or Seller by any governmental
authority or any other person or entity with regard to this Agreement or the
transactions contemplated by this Agreement.
8.5 Release of Encumbrances. All Encumbrances on any of the Purchased
Assets shall have been fully released.
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8.6 Satisfaction with Legal Matters. All legal matters in connection
with this Agreement and the transactions contemplated by this Agreement, and the
form and substance of all legal proceedings and papers, instruments and
documents used or delivered herewith or incident to this Agreement shall be
reasonably satisfactory to counsel for Purchaser.
8.7 Third-Party Consents and Approvals; Estoppel Certificates. Seller
and Purchaser have obtained all third-party (including but not limited to
governmental) consents and approvals, if any, required for the transfer or
continuance, as the case may be, of the Contracts and Permits disclosed in
Schedules 3.8 and 3.11 pursuant to the transactions contemplated by this
Agreement.
ARTICLE IX
CONDITIONS PRECEDENT TO CLOSING BY SELLER
Subject to waiver by Seller, each of the agreements of Seller to be
performed by it at the Closing pursuant to this Agreement shall be subject to
the fulfillment of each of the following conditions precedent:
9.1 Representations and Warranties. Each of the representations and
warranties of Purchaser set forth in this Agreement shall be true, correct and
complete in all material respects on the date hereof and on the Closing Date, as
if made at that time.
9.2 Agreements. Purchaser shall have performed and complied with all
agreements, undertakings, obligations and covenants which are required to be
performed or complied with by it at or prior to the Closing Date.
9.3 Requirements Purchasing Agreement. Purchaser and Seller shall have
executed the Requirements Purchasing Agreement in the form attached as Exhibit
9.3.
9.4 Closing Deliveries. Seller shall have received the items to be
delivered to it at Closing as described in Article 6.3.
9.5 Litigation. No notice shall have been received as to Litigation
being commenced or threatened against Purchaser or Seller by any governmental
authority or any other person or entity with regard to this Agreement or the
transactions contemplated by this Agreement.
9.6 Satisfaction with Legal Matters. All legal matters in connection
with this Agreement and the transactions contemplated by it, and the form and
substance of all legal proceedings and papers, instruments and documents used or
delivered herewith or incident hereto shall be reasonably satisfactory to
counsel for Seller.
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ARTICLE X
INDEMNIFICATION
10.1 Survival. All representations, warranties, covenants, obligations
and undertakings made or contained in this Agreement shall survive the Closing
and shall survive any inspection, investigation or acceptance of possession or
delivery of the Purchased Assets made or done at any time by Purchaser but only
for a period of two years after the Closing Date.
10.2 Indemnification by Seller. Seller shall indemnify, defend and hold
Purchaser harmless from and against any and all loss, liability (including, but
not limited to, consequential damages), damage, deficiency, claim or expense,
including, but not limited to, reasonable attorneys' fees, arising out of or due
to: (a) a breach of or default under any representation, warranty, covenant,
agreement, obligation or undertaking of Seller contained in this Agreement; (b)
any claims asserted against Seller or Purchaser and arising out of the operation
of the Business on or prior to the Closing Date; (c) noncompliance with any laws
relating to bulk sales or other laws for the protection of creditors; (d) the
failure of the Seller to file any federal, state or local returns in connection
with or pay any Taxes due and payable, accrued, incurred or attributable to any
event or circumstance occurring or existing or applicable to any period ending
on or before the Closing Date; and (e) any debt, liability, commitment or
obligation, of any nature, whether accrued, absolute, contingent or other and
whether due or to become due of Seller, or arising out of the business
operations of the Business prior to the Closing Date or Seller's ownership or
use of any of the Purchased Assets prior to the Closing Date.
10.3 Indemnification by Purchaser. Purchaser shall indemnify, defend
and hold Seller harmless from and against any and all loss, liability
(including, but not limited, consequential damages), damage deficiency, clam, or
expense, including, but not limited to, reasonable attorneys' fees, arising out
of or due to: (a) the Vehicle Loans due and payable after the Closing Date; (b)
a breach of or default under any representation, warranty, covenant, obligation
or undertaking of Purchaser contained in this Agreement; (c) any claims asserted
against Seller or Purchaser, and arising out of the operation of the Business
after the Closing Date; and, (d) any debt, liability, commitment or obligation,
of any nature, whether accrued, absolute, contingent or other, and whether due
or to become due, of Purchaser, or arising out of the business operations of the
Business after the Closing Date or Purchaser's ownership or use of any of the
Purchased Assets after the Closing Date.
10.4 Notice and Defense of Claims. A party claiming indemnification
under this Article X (the "Asserting Party") will give prompt written notice
(the "Claim Notice") of the nature and basis of the claim to the party from whom
indemnification is being sought (the "Indemnifying Party"). If the claim for
indemnification arises out of a claim, action or proceeding by a third party (a
"Third Party Claim"), the
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Indemnifying Party may elect to assume the defense of the Third Party Claim at
its own expense with counsel selected by the Indemnifying Party. If the
Indemnifying Party assumes the defense of the Third Party Claim, the
Indemnifying Party will not be liable for any fees or expenses of counsel for
the Asserting Party incurred in connection with the Third Party Claim. If the
Indemnifying Party does not assume the defense of the Third Party Claim, the
Asserting Party will have the right to defend and settle the Third Party Claim.
The Asserting Party and the Indemnifying Party will cooperate in the defense of
any claim, action or proceeding covered by this Section 10.4. The Asserting
Party will make available to the Indemnifying Party all records and other
materials reasonably required by the Indemnifying Party for use in contesting
the Third Party Claim. Where a third party in a Third Party Claim is a
significant continuing supplier or customer of the Asserting Party and the
conduct of the Third Party Claim may have a material adverse effect on the
continued operation of the business of the Asserting Party, the Indemnifying
Party shall consult with the Asserting Party in good faith with a view to
reducing or eliminating the adverse effect of the conduct of the Third Party
Claim.
10.5 Maximum Aggregate Liability of the Parties. The maximum aggregate
indemnification liability of the Seller under Section 10.2 and the of Buyer
under Section 10.3 shall not exceed the Purchase Price.
10.6 Threshold. Neither party will be entitled to indemnification under
Section 10.2 unless the aggregate amount incurred by it for which it is
indemnified exceeds $5,000.
10.7 Sole Remedy. Except for the breach of Section 7.1, the Seller or
Purchaser's sole remedies for the breach of the terms of this Agreement shall be
pursuant to this Article X.
ARTICLE XI
MISCELLANEOUS
11.1 Assignment. This Agreement shall be binding upon and inure to the
benefit of the successors and assigns of each party to this Agreement, but no
rights, obligations or liabilities under this Agreement shall be assignable by
any party without the prior written consent of the other parties.
11.2 Third Parties. Nothing expressed or implied in this Agreement is
intended, or shall be construed, to confer upon or give any other person or
entity other than the parties to this Agreement any rights or remedies under or
by reason of this Agreement.
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11.3 Complete Agreement. Except as expressly set forth in this
Agreement or in an instrument in writing signed by the party to be bound thereby
which makes specific reference to this Agreement, this Agreement sets forth the
entire understanding of the parties concerning the subject matter of this
Agreement and supersedes all prior contracts, arrangements, communications,
discussions, representations and warranties, whether oral or written, between
the parties relating to the subject matter of this Agreement.
11.4 Expenses. Each of the parties to this Agreement shall pay all
costs and expenses incurred or to be incurred by it in negotiating and preparing
this Agreement, and in closing and carrying out the transactions contemplated in
this Agreement.
11.5 Amendment. This Agreement may be amended at any time by a writing
which refers to this Agreement and is executed by Purchaser and Seller.
11.6 Further Assurances. Seller shall from time to time after the
Closing upon the reasonable request of Purchaser, execute, acknowledge and
deliver all such further acts, deeds, assignments, transfers, conveyances and
assurances as may be reasonably required to transfer to and to vest in Purchaser
all good, valid, marketable and indefeasible right, title and interest of the
Seller to the Purchased Assets, and to protect the right, title and interest of
Purchaser in and to all of the Purchased Assets.
11.7 Taxes. Seller shall pay all sales and use taxes and transfer
taxes, if any, applicable to the transactions contemplated by this Agreement.
11.8 Notices. All notices, requests, demands and other communications
required or permitted to be given under this Agreement shall be in writing and
shall be deemed to have been given (a) when delivered personally, (b) when
transmitted by facsimile, (c) on the third business day after being deposited in
the U.S. mail, certified, postage prepaid, return receipt requested, or (d) on
the first business day after being sent by a nationally recognized overnight
express courier service, to a party addressed as follows:
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If to Seller:
Xxxxxx X. Xxxxxxx, Chief Executive Officer
First Aid Select, Inc.
00000 XX 00xx Xxxxxx
Xxxxxxx, XX 00000-0000
Fax: (000) 000-0000
If to Purchaser to:
Xxxxxx X. Xxxxxx, President
Xxx Xxxx-Xxxxxx, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
Any party may change the names and addresses to which such
communications are to be directed by giving notice to the other party of such
change in the manner provided above.
11.9 Severability. Each Article, section, subsection and lesser
section of this Agreement constitutes a separate and distinct undertaking and
covenant. In the event that any provision of this Agreement shall finally be
determined to be unlawful, such provision shall be limited by construction in
scope and effect to the minimum extent necessary to render the same lawful and
if such a limiting construction is not possible, such provision shall be deemed
severed from this Agreement, but in any event every other provision of this
Agreement shall remain in full force and effect.
11.10 Waivers. Any waiver by any party of any violation of, breach of
or default under any provision of this Agreement by the other party shall not be
construed as or constitute a continuing waiver of such provision, or a waiver of
any other violation of, breach of or default under any other provision of this
Agreement.
11.11 Exhibits. The Exhibits and Schedules attached to this Agreement
and/or referred to in this Agreement are part of this Agreement for all
purposes.
11.12 Captions. The captions in this Agreement are intended solely for
convenience of reference and shall not be given any effect in the construction
or interpretation of this Agreement.
11.13 Governing Law. This Agreement shall be exclusively governed by
and construed in accordance with the laws of the State of Ohio.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
FIRST AID SELECT, INC.
By:_________________________________
Xxxxxx X. Xxxxxxx
Chief Executive Officer
"Seller"
XXX XXXX-XXXXXX, INC.
By:_____________________________
Xxxxx X. Xxxxxxxx
Vice President and Chief
Financial Officer
"Purchaser"
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