EXHIBIT 10.36
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "AGREEMENT") is entered into as of
August 8, 2003 ("EXECUTION DATE") by and among RMF Industrial Contracting, Inc.,
a Michigan corporation, and Delta Maintenance, Inc., a Louisiana corporation
(each a "SELLER" and collectively, the "SELLERS") and Nooter Construction
Company, a Missouri corporation, ("BUYER"). Xxxxxx Services Corporation, a
Delaware corporation, is a party to this Agreement solely for the purposes of
Sections 5.3, 5.4 and 5.5.
RECITALS:
WHEREAS, Sellers desire to sell and Buyer desires to buy substantially
all of Sellers' operating assets as hereinafter described; and
WHEREAS, Sellers are debtors-in-possession in a case under Chapter 11
of Title 11 of the United States Code (the "BANKRUPTCY CODE") pending in the
Southern District of Texas, Houston, Texas (the "BANKRUPTCY COURT") along with
other debtors-in-possession under jointly administered Case No. 03-37718 (the
"BANKRUPTCY CASE"); and
WHEREAS, each Seller has been soliciting bids for its assets, including
the Assets to be sold pursuant to this Agreement and has determined that the
offer of Buyer for the Assets set forth below is the highest and best offer
received for the Assets and constitutes a fair and adequate purchase price.
TERMS AND CONDITIONS:
NOW, THEREFORE, in consideration of the mutual promises, covenants and
conditions set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by all parties, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
following respective meanings:
1.1 "AFFILIATE" or "AFFILIATES" shall mean with respect to a
specified Person, another Person that, either directly or indirectly through one
or more intermediaries, controls or is controlled by, or is under common control
with the Person specified.
1.2 "ASSETS" shall mean, collectively, the assets of each Seller
listed on Schedule 1.2 to this Agreement and the following other assets of each
Seller:
1.2.1 All of Seller's interest, if any, in the leasehold
and building improvements related to RMF Industrial Contracting, Inc.'s
leased premises located at 000 Xxxxxxxxx Xxxx, Xxxxxx, Xxxx (the
"LEASED PROPERTY");
1.2.2 All rights existing under those certain leases,
orders, supply agreements and other contracts and agreements of Seller
(the "CONTRACTS") that are expressly identified as being assumed by
Buyer on Schedule 1.2.2, excluding any such Contracts that have
terminated or expired before the Effective Date in accordance with
their terms or in the ordinary course of Business, and including any
Contract approved by Buyer in writing that is entered into by a Seller
in the ordinary course of Business after the Execution Date and before
the Effective Date (the "ASSUMED CONTRACTS");
1.2.3 All inventories, supplies, replacement parts, spare
parts and other inventories owned by either Seller, if any;
1.2.4 All machinery, vehicles, tools, tooling, parts and
equipment (including transportation equipment) owned by either Seller,
whether or not listed on Schedule 1.2;
1.2.5 All furniture, furnishings, fixtures, personal
property, telephone systems, miscellaneous office supplies, office
equipment, computer hardware, production supplies, and other
miscellaneous supplies owned by either Seller, whether or not listed on
Schedule 1.2 and located at the Leased Property;
1.2.6 All registered, unregistered, registrations for and
applications for registration of common law trademarks, service marks,
logos, trade names, trade dress and other trademark rights, including
the names "RMF", "RMF Industrial Contracting", "Delta Maintenance" and
all derivations thereof; all registered, registrations for and
applications for registration of copyrights, together with all of
Seller's rights to use all of the foregoing and all other rights in, to
and under the foregoing in all countries; all trade secrets, ideas,
research and development, know-how, inventions, formulas, and
processes; and all art work, advertising and promotional materials
(historical and current) and all other printed or written materials
relating to any of the foregoing in each instance to the extent used in
the Business (the "INTELLECTUAL PROPERTY");
1.2.7 All computer software listed on Schedule 1.2.7;
1.2.8 All goodwill of the Business, if any;
1.2.9 All books and records owned by each of the Sellers
which are used, held for use or were previously used in the Business,
including but not limited to records, tangible data, documents, files,
customer and supplier lists (including supplier cost information),
specifications, design drawings, plans, operations or maintenance
manuals, personnel records with respect to employees hired by Buyer
(except for records which may not be transferred, shared or revealed
pursuant to applicable Laws), invoices, credit records, sales
literature and current price lists;
1.2.10 Prepaid expenses, prepaid deposits, and security
deposits of each of the Sellers relating to the Business listed on
Schedule 1.2.10 and all insurance proceeds related to any Assets
damaged, destroyed or stolen during the period following the Execution
Date and up to and including the Effective Date;
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1.2.11 At Buyer's option, to be exercised by written notice
to Seller prior to Closing, any or all confidentiality, non-competition
or nondisclosure agreements executed by third parties in favor of
Seller, in each case, relating to the sale of the Business to the
extent that such agreements are freely assignable.
1.3 "ASSUMED LIABILITIES" shall mean only those obligations of
each of the Sellers (i) arising post-Closing under the Assumed Contracts, (ii)
all Cure Costs, and (iii) the Payables.
1.4 "BUSINESS" shall mean the businesses of RMF Industrial
Contracting, Inc. and Delta Maintenance, Inc., as currently conducted.
1.5 "BUSINESS DAY" shall mean any date, other than Saturday or
Sunday, on which major banks are open for business in New York, New York.
1.6 "CLOSING" shall mean the consummation of the purchase and sale
of Assets and the assignment and assumption of the Assumed Contracts as of the
Effective Date.
1.7 "COMMITTEE" shall mean the Official Committee of Unsecured
Creditors appointed in the Bankruptcy Case.
1.8 "CONFIDENTIAL INFORMATION" means all information, belonging or
relating to the Business which is not generally known to the public, including
without limitation business or trade secrets, price lists, methods, formulas,
know-how, customer lists, manufacturing processes, job costs, marketing plans,
research and development and financial information.
1.9 "CURE COSTS" shall mean amounts due and payable on account of
defaults listed on Schedule 1.9, which must be paid in order to effectuate the
assumption by each of the Sellers and assignment to Buyer of the Assumed
Contracts listed on Schedule 1.2.2 to this Agreement, in accordance with Section
365 of the Bankruptcy Code and the Sale Order. The amount of all Cure Costs paid
by Buyer shall be deducted from the Purchase Price. The Seller shall update
Schedule 1.9 on or before the third day before the Closing Date to reflect
changes in the Cure Costs, if any.
1.10 "EFFECTIVE DATE" shall have the meaning set forth in Section
2.3.
1.11 "EMPLOYEE" or "EMPLOYEES" shall mean any full time and/or part
time employee who performs services during substantially all of his/her working
time for the Business.
1.12 "ENVIRONMENTAL CLAIMS" shall mean any and all actions, suits,
demands, demand letters, claims, liens, notices of non-compliance or violation,
notices of liability or potential liability, natural resource damage claims,
investigations, proceedings, consent orders or consent agreements made by a
Governmental Entity relating in any way to Environmental Laws or Hazardous
Materials or any third party claim arising from any alleged injury or threat of
injury to health, safety or the environment relating in any way to Environmental
Laws or any Hazardous Materials.
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1.13 "ENVIRONMENTAL LAWS" shall mean any Laws in effect as of the
Closing Date relating to the generation, production, use, storage, treatment,
handling, transportation or disposal of Hazardous Materials, or the protection
of human health or the environment.
1.14 "ENVIRONMENTAL REPORTS" shall mean those documents listed on
Schedule 1.14 to this Agreement.
1.15 "ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
1.16 "EXCLUDED ASSETS" shall mean (i) cash and cash equivalents
(other than prepaid deposits included as Assets), (ii) accounts receivable,
work-in-progress and unbilled accounts, (iii) prepaid insurance, (iv) any tax
refunds, (v) the right to the Purchase Price and other rights granted to each of
the Sellers under this Agreement or any other agreement with Buyer or its
Affiliates, (vi) all preference or avoidance claims and actions arising under
Sections 544, 547, 548, 549 and 550 of the Bankruptcy Code, (vii) derivative
suits and similar causes of action against the Board of Directors of either of
the Sellers, (viii) the articles or certificate of incorporation, bylaws, seal,
related organizational documents and minute books of each Seller, (ix)
recoveries on litigation of a Seller, (x) any executory contracts or unexpired
leases that are not Assumed Contracts, and (xi) any assets in each Seller's
possession that it does not own.
1.17 "EXCLUDED LIABILITIES" shall mean all liabilities of each of
the Sellers other than those specified in the definition of Assumed Liabilities
set forth in this Agreement.
1.18 "EXECUTION DATE" shall have the meaning set forth in the
opening paragraph of this Agreement.
1.19 "GAAP" shall mean generally accepted accounting principles as
in effect from time to time in the United States, consistently applied.
1.20 "GOVERNMENTAL ENTITY" shall mean any United States or
non-United States governmental, quasi-governmental or regulatory authority.
1.21 "HAZARDOUS MATERIALS" shall mean any wastes, substances, or
materials (whether solids, liquids or gases) that are defined or listed by a
Governmental Entity as hazardous, toxic, pollutants or contaminants, including,
without limitation, substances defined as "hazardous wastes," "hazardous
substances," or "toxic substances" under any Environmental Laws. "Hazardous
Materials" includes, without limitation, polychlorinated biphenyls (PCBs),
asbestos, lead-based paints, and petroleum and petroleum products (including,
without limitation, crude oil or any fraction thereof).
1.22 "INTERNAL REVENUE CODE" shall mean the Internal Revenue Code
of 1986, as amended (or the applicable provisions of any succeeding statute).
1.23 "KNOWLEDGE OF SELLERS" shall mean the actual knowledge of the
Persons in their respective capacities as set forth on Schedule 1.23 of this
Agreement.
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1.24 "LAW" or "LAWS" shall mean all foreign, federal, state and
local statutes, laws, ordinances, regulations, rules, writs, injunctions,
judgments and decrees, as applicable to the specified Buyer or Seller.
1.25 "PAYABLES" shall mean amounts due and payable pre-petition and
post-petition under the Assumed Contracts listed on Schedule 1.2.2 which are not
included on Schedule 1.9. The amount of all Payables paid by Buyer shall be
deducted from the Purchase Price. The Seller shall deliver Schedule 1.25 in form
and substance mutually agreeable to the Buyer and Sellers on or before the third
day before the Closing Date to reflect the Payables.
1.26 "PERSON" or "PERSONS" shall mean any individual, company, body
corporate, association, partnership, limited liability company, firm, joint
venture, trust and governmental agency.
1.27 "SALE ORDER" shall mean the final, non-appealable order of the
Bankruptcy Court, approving this Agreement and the transactions contemplated
hereby in accordance with Sections 363, 365, 1142 and 105 of the Bankruptcy
Code. The Sale Order must be in form and substance mutually acceptable to Buyer
and Sellers and materially and substantially in the form attached hereto as
Exhibit A.
1.28 "TERRITORY" shall mean all parts of the world to which either
Seller has sold products or rendered services within the 12 months preceding the
date hereof.
ARTICLE II
PURCHASE OF ASSETS
2.1 Purchase; Purchase Price and Xxxxxxx Money.
2.1.1 Purchase. Subject to the approval of this transaction
by the Bankruptcy Court pursuant to a Sale Order, and upon the terms
and subject to the conditions contained in this Agreement, Sellers
shall: (i) sell, assign, and deliver to Buyer, and Buyer shall purchase
and accept, all of each Seller's right, title and interest in the
Assets; and (ii) transfer and assign to Buyer, and Buyer shall accept
the assignment of and assume, all of each Seller's right, title and
interest in and to the Assumed Contracts. Buyer is not acquiring, and
each Seller shall retain all right, title and interest in any of their
respective Excluded Assets.
2.1.2 Purchase Price. The purchase price ("PURCHASE PRICE")
shall be Five Million One Hundred Thousand Dollars ($5,100,000.00).
2.1.3 Prorations. Except as to Cure Costs and Payables,
Sellers and Buyer agree that all items relating to the Assets and the
Assumed Contracts other than the Basic Contracts and the Lump Sum
Contracts (defined in Sections 9.1.2 and 9.1.3 respectively), including
but not limited to, (i) rents, (ii) royalties, maintenance fees,
charges and other amounts that in any case are payable periodically by
either Seller or Buyer under any of the Assumed Contracts; (iii) sewer
rents and charges for water, electricity and other
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utilities and fuel; and (iv) other similar items agreed upon by the
parties, will be prorated as of the Effective Date on the basis of the
actual number of days each party had possession or use during the
period, except for those items where it is possible to prorate by
actual usage. Such proration shall occur within 60 days following
Closing, and Sellers shall reimburse Buyer within five Business Days of
receipt of invoice from Buyer for prorated items related to any time
period up to and including the Effective Date. Buyer shall be
responsible for paying all prorated items when and as they become due.
2.1.4 Liabilities. At Closing, as additional consideration
to Sellers for the sale and assignment of the Assets and Assumed
Contracts, Buyer shall assume, and agree to pay, perform, fulfill and
discharge, the Assumed Liabilities.
2.1.5 Payment of Purchase Price. At Closing, Buyer shall
pay to Sellers the Purchase Price less the sum of (i) Cure Costs, (ii)
Payables, (iii) the Xxxxxxx Money Deposit, (iv) One Hundred Thousand
Dollars ($100,000.00) (the "HOLDBACK AMOUNT"), to be withheld by Buyer
to secure the indemnity obligations of Sellers set forth in Article
VIII, and (v) the Excess Billing (defined in Section 9.1.3). The
foregoing sum shall be paid by wire transfer of immediately available
funds to the United States account or accounts designated by Sellers no
later than 2 p.m. Central Standard Time on the Closing Date.
Concurrently, Buyer shall direct the Escrow Agent to pay to Sellers by
wire transfer the Xxxxxxx Money Deposit.
2.1.6 Xxxxxxx Money. Concurrently with the execution of
this Agreement, Buyer is delivering to Xxxxx Fargo Bank of Texas, N.A.
(the "ESCROW AGENT"), a deposit in the amount of Five Hundred Ten
Thousand Dollars ($510,000.00) (which, along with all accrued interest
thereon shall be the "XXXXXXX MONEY DEPOSIT"). The Escrow Agent shall
hold the Xxxxxxx Money in an interest-bearing escrow account pursuant
to the terms of the Escrow Agreement attached as Exhibit B. The Xxxxxxx
Money Deposit shall be applied to the Purchase Price at Closing or, in
the event Closing does not occur, the Xxxxxxx Money Deposit shall be
distributed as set forth in this Agreement. The Escrow Agent's fees and
charges shall be paid one half by Buyer and one half by Sellers.
2.2 Sellers' Liabilities. It is understood and agreed that Buyer
shall not assume or become liable directly, indirectly, contingently or
otherwise for the payment of any debts, liabilities, losses, accounts payable,
bank indebtedness, mortgages, Employee Plans (defined in Section 3.9), Employee
Agreements (defined in Section 3.9) or other obligations of either Seller of any
nature whatsoever, whether related to the Assets or otherwise, and, whether the
same are known or unknown, now existing or hereafter arising, of whatever nature
or character, whether absolute or contingent, liquidated or disputed, except the
Assumed Liabilities. Buyer shall not have any successor liability related to
either Seller or the Assets.
2.3 Closing. The Closing shall occur on August 29, 2003 or such
other earlier date as Buyer shall elect by not less than 5 days written notice
to Sellers (the "CLOSING DATE"), and shall be effective as of August 30, 2003
(the "EFFECTIVE DATE"). The Closing shall take place at the offices of Xxxxxx &
Xxxxxx, L.L.P., 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx, or at such
other place as may be mutually agreed upon by the parties.
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2.4 "AS IS" TRANSACTION. BUYER HEREBY ACKNOWLEDGES AND AGREES
THAT, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ARTICLE III OF THIS AGREEMENT,
EACH SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR
IMPLIED, WITH RESPECT TO ANY MATTER RELATING TO THE ASSETS INCLUDING, WITHOUT
LIMITATION, INCOME TO BE DERIVED OR EXPENSES TO BE INCURRED IN CONNECTION WITH
THE ASSETS, THE PHYSICAL CONDITION OF ANY PERSONAL PROPERTY OR REAL ESTATE
COMPRISING THE ASSETS OR WHICH IS THE SUBJECT OF ANY LEASE OR CONTRACT TO BE
ASSUMED BY BUYER AT THE CLOSING, THE ENVIRONMENTAL CONDITION OR OTHER MATTER
RELATING TO THE PHYSICAL CONDITION OF ANY LAND OR IMPROVEMENTS COMPRISING THE
ASSETS OR WHICH ARE THE SUBJECT OF ANY LEASE TO BE ASSUMED BY BUYER AT THE
CLOSING, THE ZONING OR PERMITTED USE OF ANY REAL ESTATE ASSETS, THE VALUE OF THE
ASSETS (OR ANY PORTION THEREOF), THE TERMS, AMOUNT, VALIDITY OR ENFORCEABILITY
OF THE ASSUMED LIABILITIES, THE MERCHANTABILITY OR FITNESS OF THE PERSONAL
ASSETS OR ANY OTHER PORTION OF THE ASSETS FOR ANY PARTICULAR PURPOSE. WITHOUT IN
ANY WAY LIMITING THE FOREGOING, EACH OF THE SELLERS HEREBY DISCLAIMS ANY
WARRANTY, EXPRESS OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PURPOSE AS TO ANY PORTION OF THE ASSETS. ON THE CLOSING DATE, BUYER SHALL
DELIVER TO SELLERS A CERTIFICATE ACKNOWLEDGING THAT BUYER HAS CONDUCTED AN
INDEPENDENT INSPECTION AND INVESTIGATION OF THE PHYSICAL CONDITION OF THE ASSETS
AND ALL SUCH OTHER MATTERS RELATING TO OR AFFECTING THE ASSETS AS BUYER DEEMED
NECESSARY OR APPROPRIATE AND THAT IN PROCEEDING WITH ITS ACQUISITION OF THE
ASSETS, EXCEPT FOR ANY REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
ARTICLE III OF THIS AGREEMENT, BUYER IS DOING SO BASED SOLELY UPON SUCH
INDEPENDENT INSPECTIONS AND INVESTIGATIONS. ACCORDINGLY, BUYER SHALL ACCEPT THE
ASSETS AT THE CLOSING "AS IS," "WHERE IS" AND "WITH ALL FAULTS."
2.5 Allocation of Purchase Price. At Closing, Buyer shall deliver
an allocation (the "Allocation") of the Purchase Price in accordance with
Section 1060 of the Internal Revenue Code. Buyer and Sellers shall (i) be bound
by the Allocation, (for tax purposes only, and not for any other purpose), (ii)
act in a manner consistent with the Allocation in the preparation of financial
statements and filing of all United States federal income tax returns
(including, without limitation, filing Form 8594 with their United States
federal income tax returns for the taxable year that includes the Effective
Date) and in the course of any tax audit, tax review or tax litigation relating
thereto, and (iii) take no position and cause their Affiliates to take no
position inconsistent with the Allocation for any tax purposes.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller hereby represents and warrants to Buyer as of the Execution
Date and Closing Date as follows:
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3.1 Organization, Standing and Power. Each Seller is a corporation
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. Subject to the applicable provisions of the
Bankruptcy Code, each Seller has the requisite corporate power and authority to
carry on its business as now being conducted.
3.2 Authority. Each Seller has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby upon entry of the Sale Order. The execution and delivery of
this Agreement by each of the Sellers and the consummation by each of the
Sellers of the transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of each Seller, subject to the conditions
set forth in this Agreement. This Agreement has been duly executed and delivered
by each Seller and (assuming the valid authorization, execution and delivery of
this Agreement by Buyer) constitutes the valid and binding obligation of each
Seller and is enforceable against each Seller in accordance with its terms upon
entry of the Sale Order.
3.3 Brokers. No broker, investment banker or other person engaged
by either Seller is entitled to any broker's, finder's or other similar fee or
commission payable by either Seller in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
either of the Sellers.
3.4 No Conflict. Upon obtaining the Sale Order, the consummation
of the transactions contemplated by this Agreement and compliance with the
provisions hereof will not (i) conflict with or result in a breach of the terms,
conditions or provisions of any order of any court or other agency of
government, the charter or bylaws of either of the Sellers, or (ii) result in
the creation or imposition of any lien, charge or encumbrance of any kind
whatsoever on any of the Assets.
3.5 Third Party Approvals. Except for (a) the Sale Order, and (b)
the consent of P2S, LLC, the execution, delivery and performance by Sellers of
this Agreement and the transactions contemplated hereby do not require any
consents, waivers, authorizations or approvals of, or filings with, any third
Persons or any Governmental Entity, which have not been obtained or are not
deemed to be overridden by Section 365 of the Bankruptcy Code.
3.6 Title. At the Closing, and subject to entry of the Sale Order,
each Seller will, pursuant to the terms of the Sale Order, deliver to Buyer good
title to all of the Assets free and clear of all liens (including liens for
federal, state or local taxes), encumbrances (including, without limitation, any
leasehold interests, licenses or other rights, in favor of any person, to use
any portion of the Assets), claims security interests, of whatever kind or
nature, mortgages, pledges restrictions, charges, instruments, licenses,
encroachments, options, rights of recovery, judgments, orders and decrees of any
court or foreign or domestic governmental authority, of any kind or nature,
whether secured or unsecured, xxxxxx or inchoate, filed or unfiled, scheduled or
unscheduled, noticed or unnoticed, recorded or unrecorded, contingent or
non-contingent, material or non-material, known or unknown, and including all
claims based on any theory that Buyer is a successor, transferee or continuation
of Seller or the Business, in each case, other than the Assumed Liabilities
expressly assumed herein, whether arising prior to or subsequent to the date of
the filing of the Chapter 11 petition of Xxxxxx Services Corporation
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3.7 Due Notice. Sellers will serve notice of the hearing in the
Bankruptcy Court regarding approval of this sale transaction on all creditors
and other parties required by the Bankruptcy Code, Section 2 of the Initial
Order for Complex Chapter 11 Bankruptcy Case dated June 2, 2003 or as otherwise
ordered by the Bankruptcy Court.
3.8 Environmental Matters. To the Knowledge of Sellers, except as
disclosed in the Environmental Reports, each Seller is in material compliance
with all applicable Environmental Laws, is not subject to any Environmental
Claims with respect to the Assets. Notwithstanding any other provision herein,
this Section 3.8 contains the exclusive representation of Sellers concerning any
matter arising under Environmental Laws.
3.9 Labor and Employment Matters.
3.9.1 Schedule 3.9 of this Agreement contains a list of (i)
each material plan, program, or other arrangement providing for
severance, termination pay, performance awards, stock or stock-related
awards, fringe benefits or other employee benefits, including, without
limitation, each "employee benefit plan" within the meaning of Section
3(3) of ERISA, which is maintained for the benefit of any Employee
("EMPLOYEE PLAN") and (ii) each management, employment, severance or
consulting agreement or contract between each of the Sellers and any
Employee ("EMPLOYEE AGREEMENT"). Each Seller has provided to Buyer
copies of all documents, if any, embodying each Employee Plan,
including all amendments thereto, and each Employee Agreement.
3.9.2 Each Seller has delivered to Buyer a list of the
current Employees of each of the Sellers involved in the operation of
the Business together with the positions they hold and their current
rates of compensation.
3.9.3 Except as set forth on Schedule 3.9, neither Seller
is a party to a collective bargaining agreement and neither Seller is
currently, nor during the past six months has it been, involved in any
discussion with any unit or group seeking to become the bargaining unit
for any Employees with respect to the Business, and, except as set
forth on Schedule 3.9 at no time since January 1, 2003, has any labor
union been certified to represent any of such Employees nor has either
Seller experienced a strike or similar material labor difficulty with
respect to the Employees of either Seller involved in the operation of
the Business.
3.10 Licenses and Permits.
3.10.1 Schedule 3.10.1 to this Agreement sets forth a list
of environmental licenses and permits necessary for the Business as
presently operated.
3.10.2 Schedule 3.10.2 to this Agreement sets forth a list
of operating licenses and permits, and other governmental approvals,
other than the environmental licenses and permits listed on Schedule
3.10.1, used in the Business as presently operated.
3.11 Absence of Certain Events. Since January 1, 2003 (i) each
Seller has conducted the Business only in the ordinary and usual course in the
context of the Bankruptcy Proceedings and in substantially the same manner as
previously conducted during the pendency of the
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Bankruptcy Proceedings; and (ii) there has not been any event, circumstance or
condition that has had, or is reasonably likely to have, a material adverse
effect on the Assets.
3.12 Compliance With Laws. To the Knowledge of Sellers, except as
set forth on Schedule 3.12, each Seller has at all times complied in all
material respects and is in compliance in all material respects with all
applicable laws, rules, regulations and ordinances affecting the Assets or the
Business. Neither Seller has violated, nor is either Seller in default with
respect to, any judgment, order, injunction, settlement agreement or decree of,
or any permit, license or other authority from, any court, agency or
instrumentality.
3.13 Disclosure. To the Knowledge of Sellers, no representation or
warranty by the Sellers in this Agreement, nor any document, certificate or
schedule furnished at the execution of this Agreement or to be furnished in
connection with the Closing, contains or will contain any untrue statement of
fact or omits or will omit a fact necessary to make the statements contained
therein not misleading.
3.14 Litigation. To the Knowledge of Sellers, except as set forth
on Schedule 3.14, there are no claims, suits, judgments, or pending or
threatened litigation that are reasonably likely to have a material adverse
effect on the Business or the Assets.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to each of the Sellers as of the
Execution Date and the Closing Date:
4.1 Organization, Standing and Power. Buyer is a corporation
organized, validly existing, and in good standing under the laws of the State of
Missouri and has the requisite corporate power and authority to carry on its
business as now being conducted.
4.2 Authority. Buyer has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by Buyer and
the consummation by Buyer of the transactions contemplated hereby have been duly
and validly authorized by all necessary action on the part of Buyer. This
Agreement has been duly and validly executed and delivered by Buyer and
(assuming the valid authorization, execution and delivery of this Agreement by
each of the Sellers) this Agreement constitutes the legal, valid and binding
obligation of Buyer and is enforceable against Buyer in accordance with its
terms.
4.3 Brokers. No broker, investment banker or other person engaged
by Buyer is entitled to any broker's, finder's or other similar fee or
commission payable by the either of the Sellers in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Buyer.
4.4 No Conflict. The consummation of the transactions contemplated
by this Agreement and compliance with the provisions hereof will not conflict
with or result in a breach of the terms, conditions or provisions of any order
of any court or other agency of government,
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the charter or bylaws of Buyer, or any loan or credit agreement, note, bond,
mortgage, indenture, lease or other agreement, instrument, permit, concession,
franchise or license applicable to Buyer or any judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to Buyer.
4.5 Third Party Approvals. Except for the Sale Order, no filing or
registration with, or authorization, consent or approval of, any third Persons
or Governmental Entity is required by or with respect to Buyer or any of its
subsidiaries in connection with the execution and delivery of this Agreement by
Buyer or is necessary for the consummation of the transactions contemplated by
this Agreement.
4.6 Actions and Proceedings. There are no actions, suits, labor
disputes or other litigation, legal or administrative proceedings or
governmental investigations pending or, to the Knowledge of Buyer, threatened
against or affecting Buyer or any of its subsidiaries or any of its or their
present or former officers, directors, employees, consultants, agents or
shareholders, as such, or any of its or their properties, assets or business
relating to the transactions contemplated by this Agreement or which could have
the effect of delaying or prohibiting the consummation of the transactions
contemplated by this Agreement. For purposes of this Agreement, "KNOWLEDGE OF
BUYER", means the actual knowledge of the officers and directors of Buyer.
4.7 Financing. Buyer has sufficient funds to consummate the
transactions contemplated hereby and shall, on or prior to the Execution Date,
provide Sellers with correspondence from its bank evidencing the same.
ARTICLE V
COVENANTS OF SELLERS
5.1 Pre-Closing Covenants of Sellers. Each of the Sellers
covenants to Buyer that after the Execution Date and prior to the Effective
Date, except (i) as contemplated by this Agreement, (ii) or as required by,
arising out of, relating to or resulting from the Bankruptcy Case or otherwise
approved by the Bankruptcy Court.
5.1.1 Each Seller will operate in the ordinary course of
business consistent with custom and practice of the Business from and
after the filing date of the Bankruptcy Case to the extent limited by
the proceedings of the Bankruptcy Case, and conduct, carry on and
maintain and preserve the Business intact; use commercially reasonable
efforts to maintain and preserve its relationships with and the
goodwill of suppliers, customers and others having business relations
with the Business; maintain the Assets, as well as books of account,
records and files related to the conduct of the Business and its
employees, all in the ordinary course of Business; and use its
commercially reasonable efforts to keep available to Buyer the
employees of the Business;
5.1.2 Each Seller will maintain itself as a duly licensed
corporation in good standing under the laws of the jurisdiction of its
incorporation.
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5.1.3 Sellers shall submit this Agreement for the approval
of the Bankruptcy Court, including approval of the assumption and
assignment of the Assumed Contracts, no later than three Business Days
after the Execution Date.
5.2 Access to Sellers' Records. Each Seller shall afford to the
Buyer and its representatives reasonable access during normal business hours
throughout the period prior to the Closing Date, or until the parties have
terminated this Agreement in accordance with its terms, to each Seller's books,
records, plant, personnel (including attorneys and accountants) and to such
other information as the Buyer shall reasonably request pertaining to the Assets
or the Business. Buyer shall not be entitled to access any materials containing
privileged communications or information about employees, disclosure of which
may violate any law.
5.3 Noncompetition. For five years after the Effective Date,
neither of the Sellers nor Xxxxxx Services Corporation or its Affiliates will
directly or indirectly (through a subsidiary, Affiliate or otherwise) in any
part of the Territory: (i) engage, as a shareholder, owner, partner, member,
joint venturer, or in a managerial capacity, in any business competitive with
the Business; provided, however, that Xxxxxxx, Xxxxxx Services Corporation and
their respective Affiliates, may own securities in companies whose securities
are publicly traded, so long as such securities constitute less than five
percent (5%) of the total outstanding voting securities of such publicly-traded
company (ii) design, develop, manufacture, assemble, process, distribute, market
or sell any products or services sold by either of the Sellers, or (iii)
influence or attempt to influence any employee of the Business that is hired by
Buyer in connection with the consummation of the transactions contemplated under
this Agreement to terminate their employment with Buyer or any Affiliate of
Buyer; provided, however, that this provision will not prevent either of the
Xxxxxxx, Xxxxxx Services Corporation or any of their respective Affiliates, from
employing any employee who responds to a general advertisement for employment on
his or her own initiative without any direct or indirect solicitation by or
encouragement from either of the Xxxxxxx, Xxxxxx Services Corporation or their
respective Affiliates.
Sellers and Xxxxxx Services Corporation have reviewed the scope,
duration and geographical scope of the covenants made in this Section 5.3 and
agree that they are reasonable and necessary to protect Buyer and its
Affiliates. However, the parties agree that if this Section is found to be
unenforceable due to restrictions unreasonable in scope, duration or
geographical area, then the appropriate court may reform this Section so that
the restrictions in it are reasonable and enforceable.
5.4 Confidential Information. Except as required by applicable
Law, from and after the date hereof, Sellers and Xxxxxx Services Corporation and
their respective Affiliates shall not disclose to any person nor make use of the
Confidential Information, without the prior written consent of Buyer.
5.5 RMF Name. Sellers and Xxxxxx Services Corporation hereby agree
that from and after the Closing Date, they and their Affiliates will phase out
any and all use of the name "RMF" over a period of time not to exceed six months
from the Effective Date, and during such six month period, use the name only in
connection with contracts existing as of the Effective Date.
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5.6 Repair of Main Office. Sellers hereby agree to endeavor to
repair the fire damage to RMF Industrial Contracting, Inc.'s main office. In the
event that such repairs are not completed prior to the Closing Date, Buyer shall
be entitled to complete such repairs and recover any reasonably incurred
expenses related thereto by offsetting such costs against the Seller Accounts
Receivable; provided, however, that Sellers' obligation to reimburse Buyer for
its expenses hereunder shall not exceed $10,000.
ARTICLE VI
COVENANTS OF BUYER
6.1 Litigation and Other Support. Following the Effective Date,
Buyer shall make available to Sellers, at no charge to Sellers, Buyer's
personnel to the extent reasonably required by Sellers in connection with any
litigation, investigation or other judicial or administrative proceedings
attributable to the ownership or operation of the Business on or prior to the
Effective Date for a period of time not to exceed 10 man days in the aggregate.
The availability of Buyer's personnel for the foregoing purposes after 10 man
days shall be subject to the mutual agreement of the Buyer and the Sellers and
Sellers shall pay to Buyer $1,000 for each mutually agreed upon man day in
excess of 10 man days that Buyer's personnel is used in connection with any of
the foregoing. In addition, Sellers shall reimburse Buyer for all reasonably
incurred out-of-pocket costs and expenses.
6.2 Access to Books and Records. To the extent either Seller has a
commercially reasonable need, Buyer shall provide such Seller with reasonable
access to those books and records relating to the Business, as conducted on or
prior to the Effective Date. Sellers shall reimburse Buyer for all reasonably
incurred out-of-pocket costs and expenses, but not including internal time
charges.
ARTICLE VII
COVENANTS OF BUYER AND SELLERS
7.1 Approvals of Third Parties; Efforts.
7.1.1 Upon the terms and subject to the conditions set
forth in this Agreement, each of the parties agrees to use commercially
reasonable efforts to take, or cause to be taken, all actions, and to
do, or cause to be done, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable to
consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement,
including, without limitation: (i) the obtaining of all necessary
consents, approvals or waivers from third parties; (ii) the execution
and delivery of any additional instruments necessary to consummate the
transactions contemplated by this Agreement.
7.1.2 Each of the Sellers shall use commercially reasonable
efforts to cause or obtain the satisfaction of the conditions
applicable to each Seller specified in Sections 10.1 and 10.2 below.
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7.1.3 Buyer will use commercially reasonable efforts to
cause or obtain the satisfaction of the conditions applicable to Buyer
specified in Sections 10.1 and 10.3 below.
7.2 Fees and Expenses. Except as otherwise provided herein, all
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby including, without limitation, the fees and
disbursements of counsel, financial advisors and accountants, shall be paid by
the party incurring such costs and expenses.
7.3 Sales, Use and Transfer Taxes. The parties agree that pursuant
to Section 1146 of the Bankruptcy Code and the Sale Order, the transfer of the
Assets shall be exempt from any sales, use, transfer, documentary and similar
taxes; if, however, such taxes are imposed, they shall be paid by Sellers.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification by Sellers. Sellers hereby jointly and
severally agree to hold harmless and indemnify Buyer and its Affiliates from and
against any loss, liability, damage or expense (collectively "DAMAGES")
reasonably incurred by Buyer, arising directly or indirectly in connection with
(i) any breach of, or any failure to perform or comply with, any representation,
warranty, covenant or other obligation of Sellers in this Agreement (without
regard to any materiality exception contained therein); (ii) any claim or
obligation of Sellers to any party not being expressly assumed by Buyer which is
asserted against Buyer; or (iii) any claim or obligation arising out of the
actions or inactions of either of the Sellers.
8.2 Indemnification by Buyer. Buyer hereby agrees to hold harmless
and indemnify each Seller and its Affiliates from and Damages reasonably
incurred by either of the Sellers, arising directly or indirectly in connection
with (i) any breach of, or any failure to perform or comply with, any
representation, warranty, covenant or other obligation of Buyer in this
Agreement (without regard to any materiality exception contained therein); or
(ii) any claim or obligation arising out of the actions or inactions of the
Buyer.
8.3 Indemnification Procedures. Promptly after any indemnified
party has received notice of or has knowledge of any claim for indemnification
hereunder, or the commencement of any controversy by a person not a party to
this Agreement ("THIRD PERSON"), the indemnified party shall promptly give the
indemnifying party written notice of such claim or the commencement of such
controversy; provided, however, that failure to give such notice shall not
preclude a party from seeking indemnification unless such failure is materially
prejudicial to the indemnifying party's ability to adequately defend such claim
or controversy. Such notice shall state the nature and the basis of such claim
and a reasonable estimate of the amount thereof. The indemnifying party has the
right to control, defend and settle, at its own expense and by its own counsel,
any claim by a Third Person so long as the indemnifying party diligently pursues
the same in good faith. If the indemnifying party undertakes to defend or
settle, it must promptly notify the indemnified party of its intention to do so,
and the indemnified party must cooperate with the indemnifying party and its
counsel in the defense thereof and in any settlement thereof. Such cooperation
includes, but is not limited to, furnishing the indemnifying party with any
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books, records or information reasonably requested by the indemnifying party
that are in the indemnified party's possession or control. The indemnified party
has the right to participate in (but not control) such matter through counsel of
its own choosing and at its own expense. The indemnified party shall not settle
or compromise any claim by any Third Person for which it is entitled to
indemnification hereunder, without the prior written consent of the indemnifying
party (which consent will not be unreasonably withheld or delayed) unless suit
shall have been instituted against it and the indemnifying party shall not have
taken control of such suit after notification thereof as provided in this
Article VIII. If the indemnifying party does not undertake to defend such matter
to which the indemnified party is entitled to indemnification hereunder, or
fails diligently to pursue such defense in good faith, the indemnified party may
undertake such defense through counsel of its choice, at the cost and expense of
the indemnifying party, and the indemnified party may settle such matter on a
commercially reasonable basis under the circumstances, and the indemnifying
party must reimburse the indemnified party for the amount paid in such
settlement and any other liabilities or expenses incurred by the indemnified
party in connection therewith. All settlements effected hereunder must effect a
complete release of the indemnified party with respect to the Third Person claim
unless the indemnified party otherwise agrees in writing.
8.4 Damage Limits. The maximum aggregate liability of the Sellers
for all Damages arising under this Agreement will equal One Hundred Thousand
Dollars ($100,000). No indemnified party shall be entitled to indemnification
for Damages either covered by insurance proceeds from insurance owned and paid
for by the Sellers or otherwise reimbursed by and Third Person. Except with
respect to the failure of Buyer to remit any Seller's Accounts Receivable
(defined in Section 9.1.4) that it collects, the maximum aggregate liability of
the Buyer for all Damages arising under this Agreement will equal One Hundred
Thousand Dollars ($100,000).
8.5 Payment. Any claim for Damages due Buyer shall first be
deducted from the Holdback Amount. Ninety (90) days following the Effective
Date, Buyer shall promptly pay to Sellers any amounts of the Holdback Amount,
together with interest thereon, not subject to claims for Damages. If any claim
theretofore asserted pursuant to this Article VIII shall have not been finally
determined to be without merit or the amount of such claim shall not have been
finally determined, a reasonable reserve for such claim shall be retained until
such claim(s) shall have been paid or finally determined to be without merit,
whereupon any remaining Holdback Amount, together with interest thereon, shall
be distributed to the Sellers.
8.6 Survival. The indemnification obligations set forth in this
Article VIII shall survive for a period of 90 days following the Effective Date,
provided, however, that if a claim is properly made under this Article VIII,
prior to the applicable expiration date, such claim may be pursued to resolution
notwithstanding expiration of the indemnification period.
ARTICLE IX
COLLECTION OF ACCOUNTS RECEIVABLE
9.1 Accounts Receivable Collection. Following the Effective Date,
Sellers have requested that Buyer provide Sellers with assistance with respect
to the collection of accounts
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receivable and other related matters otherwise resulting from the Business on
and prior to the Effective Date by providing the services described in this
Section 9.1.
9.1.1 Financial Statements. On or before September 15,
2003, the Buyer shall deliver to Sellers the Business' financial
statements as of the Effective Date, determined in accordance with GAAP
and consistent with Sellers' books and records (the "FINANCIAL
STATEMENTS"), Sellers shall have the right to audit the Financial
Statements as set forth in Section 9.1.6.
9.1.2 Unbilled Receivables, Reimbursable and Cost-Plus
Contracts. If services under reimbursable and cost-plus client
contracts (the "BASIC CONTRACTS") are provided for a period of time
beginning on or before the Effective Date and continuing after the
Effective Date (hereinafter referred to as "SPANS THE EFFECTIVE DATE"),
all revenue earned under the Basic Contracts shall be allocated to the
Sellers based on the total costs paid by the Sellers under the Basic
Contract (plus Payables related to such Basic Contract), on or prior to
the Effective Date (Sellers' portion). The Buyer will prepare invoices
for Sellers' portion of the revenue allocation, described in this
Section 9.1.2 on behalf of Sellers. The Buyer shall send these invoices
to the client with a cover letter instructing such client to remit
amounts due to the Buyer's lockbox as designated in such letter. The
Buyer shall endeavor to collect and reimburse Sellers for Sellers' pro
rata portion of such revenue as it becomes payable and collected under
the Basic Contract in connection with the Accounts Receivable
collection terms set forth in this Agreement.
9.1.3 Lump Sum Contracts. In order to fairly allocate
profit and/or loss with respect to lump sum or fixed fee contracts
("LUMP SUM CONTRACTS") that Span the Effective Date, the Buyer and
Sellers shall jointly estimate the total costs of each Lump Sum
Contract five days prior to the Effective Date, and shall estimate
profit and loss based on a proration of the costs paid by Sellers for
services provided under the Lump Sum Contract (plus Payables related to
such Lump Sum Contract) on or prior to the Effective Date (Sellers'
portion) and estimate costs to be paid by Buyer (excluding Payables
related to such Lump Sum Contract) subsequent to the Effective Date
(the Buyer's portion). The paid costs (plus the applicable Payables)
for the services provided prior to the Effective Date plus the
estimated profit or loss for the same period shall define the
work-in-progress for each Lump Sum Contract. If Sellers have billed in
excess of the work-in-progress for any Lump Sum Contract ("EXCESS
BILLING"), the Excess Billing shall be deducted from the Purchase
Price. On September 15, 2003, the Buyer and Sellers shall re-examine
their jointly prepared estimate and make a final determination of the
estimated profits and losses under the Lump Sum Contracts. If, upon
such final determination, Sellers have billed in excess of the
work-in-progress for the Lump Sum Contracts (the "FINAL EXCESS"), the
Final Excess, less the Excess Billing deducted from the Purchase Price
at Closing, shall be paid promptly by Sellers to Buyer. If the Final
Excess is less than any Excess Billing deducted from the Purchase Price
at Closing, such difference shall be paid promptly by Buyer to Sellers.
If, upon such final determination, Sellers have billed less than the
work-in-progress for the Lump Sum Contracts, then that amount, plus any
Excess Billing deducted from the Purchase Price at Closing, will be
payable by the Buyer to the Sellers within 2 business days after funds
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become available from collection of subsequent invoices for the
involved Lump Sum Contract.
9.1.4 Buyer's Collection of Accounts Receivable. For 120
days after the Effective Date (the "COLLECTION PERIOD"), the Buyer
shall perform accounts receivable collection services for Sellers as
described in this Section 9.1, and in executing such collection
services shall comply with the standards that Buyer uses in its
collections of its accounts receivable in the ordinary course of
business, and shall incur all commercially reasonable costs associated
with such collection services. Buyer shall not incur any extraordinary
costs in connection with the collection services described herein,
unless Sellers have given prior written consent. Sellers shall
reimburse Buyer for any approved extraordinary costs incurred by Buyer.
Sellers acknowledge and agree that in no event is the Buyer
guaranteeing that all or any portion of the accounts receivable that
belong to Sellers ("SELLER ACCOUNTS RECEIVABLE") will be collected. The
Buyer shall, and shall cause its Affiliates:
(i) on each Friday during the Collection Period,
to deliver cash collections related to the
Seller Accounts Receivable (net of any lien
releases, warranty costs, back charges,
mechanics liens, amounts due under Section
2.1.3, and any Buyer's Accounts Receivable
not paid to Buyer as required under Section
9.1.5) by wire transfer of immediately
available funds, in accordance with Sellers'
duly authorized payment instructions; and
(ii) on each date that cash collections are wire
transferred as described in the preceding
paragraph, to transmit for same day or next
business day delivery a report that itemizes
the wire transferred cash collections by
customer and invoice, and by offsetting
costs.
If after the Buyer contacts the customer, there are any Seller Accounts
Receivable cash collections that cannot be identified to specific customer
invoices, then the Buyer's and Sellers' senior financial representatives shall
mutually agree upon the appropriate application of such unidentified cash
collections. If the senior financial representatives cannot agree, then the
issue will be referred to the Chief Financial Officer of Buyer and the Chief
Financial Officer of Xxxxxx Services Corporation (on behalf of Sellers) for
resolution. During the Collection Period, the Buyer shall control the collection
methods, procedures and practices with respect to the Seller Accounts
Receivable; provided, however, that the Buyer shall not have authority to
discount, write-off, credit, or relieve in any manner any of the Seller Accounts
Receivable without the written consent of Sellers. During the Collection Period,
Sellers shall have the sole and exclusive discretion to authorize and approve
any discount, write-off, credit or reduction of any kind to the Seller Accounts
Receivable. The Buyer shall, and shall cause its Affiliates to promptly remit to
Sellers (or their designee) upon receipt (and in any event within seven (7) days
of receipt), all correspondence, documentation, and other records, which
describe any customer disputes related to the Seller Accounts Receivable.
9.1.5 Sellers' Collection of Accounts Receivable. In the
event that either of the Sellers directly receives any cash collections
of the Seller Accounts Receivable, such
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Seller shall promptly notify the Buyer of such receipt, and the Buyer
shall have no further obligation whatsoever to collect such
Seller-collected Seller Accounts Receivable. If either Seller receives
at any time after the Effective Date payments of amounts that are due
or otherwise belong to the Buyer (the "BUYER'S ACCOUNTS RECEIVABLE"),
such Seller shall:
(i) on each Friday during the Collection Period,
to deliver cash collections related to the
Buyer's Accounts Receivable by wire transfer
of immediately available funds, in
accordance with the Buyer's duly authorized
payment instructions; and
(ii) on each date that cash collections are wire
transferred as described in the preceding
paragraph, to transmit for same day or next
business day delivery a report that itemizes
the wire transferred cash collections by
customer and invoice.
Sellers shall, and shall cause any of their subsidiaries or Affiliates to
promptly remit to the Buyer upon receipt (and in any event within seven (7) days
of receipt), all correspondence, documentation, and other records, related to
the Buyer's Accounts Receivable billed by the Buyer but received by either
Seller, if any. The Buyer shall have the right to audit the Buyer's Accounts
Receivable collection records supporting all wire transfer amounts made in
accordance with this Section 9.1.5.
9.1.6 Right to Audit. Sellers shall have upon two days
prior written notice to Buyer the right to audit:
(i) the Financial Statements for a period of
thirty (30) days following Sellers' receipt
of the Financial Statements;
(ii) the account balances described in Sections
9.1.2 and 9.1.3 until such balances are
billed and/or collected; and
(iii) the Seller Accounts Receivable collection
records supporting all wire transfer amounts
made in accordance with Section 9.1.5 for a
period of thirty (30) days following the end
of the Collection Period.
Any such audit shall occur at Buyer's offices during regular business hours. If
any disputed items occur as a result of an audit, then the senior financial
representatives of Buyer and Sellers shall promptly meet and endeavor to reach
agreement as to the accounts in dispute. If the senior financial representatives
cannot agree, then the issue will be referred to the Chief Financial Officer of
the Buyer and the Chief Financial Officer of Xxxxxx Services Corporation (on
behalf of Sellers) for resolution. The audit periods set forth herein are
subject to the assumption that Buyer provides Sellers and their representatives
access to all the books, records, workpapers, correspondence, and other records
supporting the Financial Statements and accounts, and to the Buyer's personnel
and accountants for the purpose of conducting an audit. To the extent such
access is unreasonably delayed or limited, the audit periods shall be extended
to allow Sellers and their respective representatives such access for the full
period.
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ARTICLE X
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
10.1 Conditions to Each Party's Obligations. The respective
obligations of each party to effect the transactions contemplated by this
Agreement shall be subject to the fulfillment on or prior to the Closing Date of
the following conditions:
10.1.1 No Order Preventing Transactions. No court or other
governmental entity having jurisdiction over Sellers or Buyer, or any
of their respective subsidiaries, shall have enacted, issued,
promulgated, enforced or entered any law, rule, regulation, executive
order, decree, injunction or other order (whether temporary,
preliminary or permanent) which is then in effect and has the effect of
making the transactions contemplated by this Agreement illegal.
10.1.2 Bankruptcy Court Approval. The Bankruptcy Court shall
have entered the Sale Order, and the Sale Order shall not have been stayed as of
the Closing Date.
10.2 Conditions to Obligation of Sellers.
10.2.1 The obligation of Sellers to effect the transactions
contemplated by this Agreement shall be subject to the fulfillment on
or prior to the Closing Date of the condition that Buyer shall have
performed in all material respects each of its covenants and agreements
contained in this Agreement required to be performed on or prior to the
Closing Date, including payment of the Purchase Price, and each of the
representations and warranties of Buyer contained in this Agreement
shall be true and correct in all material respects on and as of the
Closing Date as if made on and as of such date.
10.3 Conditions to Obligations By Buyer. The obligation of Buyer to
effect the transactions contemplated by this Agreement shall be subject to the
fulfillment on or prior to the Closing Date of the following additional
conditions:
10.3.1 Performance of Obligations; Representations and
Warranties. Each of the Sellers shall have performed in all material
respects each of its covenants and agreements contained in this
Agreement required to be performed on or prior to the Closing Date, and
each of the representations and warranties of Sellers contained in this
Agreement shall be true and correct in all material respects on and as
of the Closing Date as if made on and as of such date.
10.3.2 Transfer and Assumption Documents. Sellers shall convey
title to Buyer to the Assets and Buyer shall assume the Assumed
Liabilities by executing documents in substantially the form set forth
on Exhibit C.
10.3.3 No Material Adverse Change. No specific condition,
event, change or occurrence or any series of the foregoing shall have
occurred since the Execution Date with respect to the Business or the
Assets which, individually or in the aggregate, has had or is
reasonably likely to have a material adverse effect on the Business or
the Assets.
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10.3.4 Confidentiality Agreements. Buyer shall have received
copies of all confidentiality, non-competition and non disclosure
agreements described in Section 1.2.11 of this Agreement.
10.3.5 Estoppel Letter From Landlord. Buyer shall have
received an Estoppel Letter from the landlord in connection with RMF
Industrial Contracting, Inc.'s leased premises located at 000 Xxxxxxxxx
Xxxx, Xxxxxx, Xxxx in form and substance reasonably acceptable to
Buyer.
ARTICLE XI
TERMINATION, AMENDMENT, AND WAIVER
11.1 Termination. This Agreement may be terminated in writing at
any time prior to the Closing Date:
11.1.1 By Buyer if,
11.1.1.1 the Closing does not occur on or before
August 29, 2003, unless the failure to consummate the Closing
by such date shall be due to the failure of the Buyer to have
fulfilled any of its obligations under this Agreement, or
11.1.1.2 the Sale Order has not been issued by the
Bankruptcy Court, other than due to Buyer's breach of this
Agreement.
In the event Buyer terminates this Agreement for any reason set forth in this
Section 11.1.1, Buyer shall be entitled to the return of its Xxxxxxx Money
Deposit.
11.1.2 By Sellers, if
11.1.2.1 the Closing does not occur on or before
August 29, 2003, unless the failure to consummate the Closing
by such date shall be due to the failure of the Sellers to
have fulfilled any of their obligations under this Agreement
,or
11.1.2.2 the Sale Order has not been issued by the
Bankruptcy Court, other than due to Sellers' breach of this
Agreement;
11.1.3 By Buyer or Sellers if, before the Closing Date, the
other party is in material breach of any representations, warranty,
covenant or agreement contained herein and has not cured the same, such
termination shall become effective ten (10) Business Days after notice
has been provided by the objecting party as provided for in Section
12.3 of this Agreement, provided that a cure has not been affected.
11.1.4 Notwithstanding anything to the contrary in this
Section 11.1, the parties may by mutual written consent delivered in
the manner provided for in Section 12.3 of
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this Agreement extend the Closing of this Agreement. Such mutual
written consent must be received by all parties prior to the previous
Closing Date.
11.2 Liability if Agreement Terminated. Termination of this
Agreement shall not relieve any party of any liability for breaches of this
Agreement prior to the date of termination.
11.3 Break-Up Fee. It is expressly acknowledged and agreed that
Sellers, and the bankruptcy estate of Sellers, are directly benefited by Buyer's
due execution, submission of and agreement to the terms of this Agreement. As a
protection to Buyer in connection with costs, time and effort expended, the
parties have agreed that it is reasonable to award Buyer a break-up fee in the
event that any party other than Buyer becomes lawfully entitled to purchase and
consummates the purchase, as a result of, or in connection with, competitive
bidding allowed by the Bankruptcy Court, of (i) solely the Assets or (ii) the
Assets in combination with other assets or properties held by Sellers or their
Affiliates in the bankruptcy estate. In such event Buyer shall be entitled to
receive (in addition to the return of the Xxxxxxx Money Deposit) a break-up fee,
to be paid in cash at the closing of sale of the Assets in an amount of Seventy
Five Thousand Dollars ($75,000.00) (the "BREAK-UP FEE"). It is not contemplated
that the Assets will be subject to further competitive bidding. However, if they
are, at any auction, Buyer is entitled to bid against other prospective bidders.
If Buyer is the successful bidder, Buyer shall be entitled to a credit against
the purchase price payable at Closing equal to the entire amount of the Break-Up
Fee.
ARTICLE XII
GENERAL PROVISIONS
12.1 Survival of Representations and Warranties. The
representations and warranties set forth in this Agreement or in any schedule,
exhibit or instrument delivered pursuant to this Agreement by Seller shall
survive for a period of ninety (90) days following the Effective Date.
12.2 Expenses. Each party shall pay its own expenses incident to
this Agreement and the transactions hereby contemplated.
12.3 Notices. Any notice, communication, request, reply or advice
hereunder (a "Notice") must be in writing and shall be delivered by reputable
overnight commercial courier service or hand delivery. Notice so given shall be
effective when delivered. Refusal of delivery shall be deemed to be receipt.
Notice given in any other manner shall be effective when received by the party
to whom it is given. For purposes of Notice, the addresses of the parties shall
be as follows:
If to Sellers: Xxxxxx Services Corporation
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: General Counsel
Phone: 000-000-0000
Fax: 000-000-0000
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and a copy to: Xxxxxx & Xxxxxx, L.L.P.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: T. Xxxxxxx Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
If to Buyer: Nooter Construction Company
0000 X. Xxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
and a copy to: Xxxxx, Rice & Xxxxxxxx, X.X.
000 X. Xxxxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
12.4 Section and Other Headings. Section or other headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.
12.5 Schedules and Exhibits. Each schedule and exhibit attached
hereto shall be deemed to be a part of this Agreement to the same extent as if
set forth verbatim in the body of this Agreement.
12.6 Enforcement. The laws of the State of Texas shall govern the
interpretation, validity, performance and enforcement of this Agreement, without
reference to any conflict of law or choice of law provisions therein. If any
provision of this Agreement should be held to be invalid or unenforceable, the
validity and enforceability of the remaining provisions of this Agreement shall
not be affected thereby.
12.7 Assignability; Parties; No Third Party Beneficiaries. This
Agreement and the rights, interests or obligations hereunder may not be assigned
by any of the parties hereto without the prior written consent of the other
parties hereto, except that Buyer may make such assignment (of all or portions)
to any of its Affiliates without prior written consent; provided, however, that
in the event Buyer assigns all or any of this Agreement to an Affiliate, Buyer
shall remain liable for its obligations hereunder. This Agreement shall be
binding upon and enforceable against, and shall inure solely to the benefit of,
the parties hereto and their respective permitted successors and assigns.
Nothing herein shall confer any rights or remedies to any person or entity which
is not a party hereto.
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12.8 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
12.9 Facsimile Signature. This Agreement may be executed and
accepted by facsimile signature and any such signature shall be of the same
force and effect as an original signature.
12.10 Further Assurances. Both parties agree that either will
execute such further documentation or take such further actions as the other
party may reasonably request to effectuate the transfer of the Assets and
implement this Agreement.
12.11 WAIVER OF JURY TRIAL. THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVE ANY RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY DISPUTE RELATED IN ANY
WAY TO BUYER'S BID OR THIS AGREEMENT.
12.12 Exclusive Jurisdiction. Without limiting any party's right to
appeal any order of the Bankruptcy Court, (a) the Bankruptcy Court shall retain
exclusive jurisdiction to enforce the terms of this Agreement and to decide any
claims or disputes that may arise or result from, or be connected with, this
Agreement, any breach or default hereunder, or the transactions contemplated
hereby, and (b) any and all claims, actions, causes of action, suits and
proceedings related to the foregoing shall be filed and maintained only in the
Bankruptcy Court, and the parties hereby consent to and submit to the
jurisdiction and venue of the Bankruptcy Court and shall receive notices at such
locations as indicated in Section 12.3 hereof.
[signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth above.
"Buyer"
NOOTER CONSTRUCTION
COMPANY, A MISSOURI CORPORATION
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
-----------------------------------
Title: President
-----------------------------------
"Sellers"
RMF INDUSTRIAL CONTRACTING,
INC., A MICHIGAN CORPORATION
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
DELTA MAINTENANCE, INC., A
LOUISIANA CORPORATION
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
Solely for the purposes of Sections 5.3, 5.4 and 5.5:
XXXXXX SERVICES CORPORATION, A
DELAWARE CORPORATION
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth above.
"Buyer"
NOOTER CONSTRUCTION
COMPANY, A MISSOURI CORPORATION
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
"Sellers"
RMF INDUSTRIAL CONTRACTING,
INC., A MICHIGAN CORPORATION
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
-----------------------------------
Title: President
-----------------------------------
DELTA MAINTENANCE, INC., A
LOUISIANA CORPORATION
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
-----------------------------------
Title: President
-----------------------------------
Solely for the purposes of Sections 5.3, 5.4 and 5.5:
XXXXXX SERVICES CORPORATION, A
DELAWARE CORPORATION
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
-----------------------------------
Title: Senior Vice President
-----------------------------------
- 24 -
FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT
This First Amendment to Asset Purchase Agreement ("FIRST AMENDMENT") is
made and entered into as of August 25, 2003 by and among RMF Industrial
Contracting, Inc., a Michigan corporation, and Delta Maintenance, Inc., a
Louisiana corporation (each a "SELLER" and collectively, the "SELLERS"), Nooter
Construction Company, a Missouri corporation ("BUYER") and Philips Services
Corporation ("PHILIPS") solely for the purposes of Sections 5.3, 5.4 and 5.5.
RECITALS
A. Buyer, Seller and Philips have previously entered into an
Asset Purchase Agreement dated August 8, 2003 (the "ASSET PURCHASE AGREEMENT").
B. Buyer, Seller and Philips desire to amend such Asset Purchase
Agreement as described herein.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the parties agree as follows:
1. The following provision is hereby added as a new paragraph at
the end of Section 5.3 of the Asset Purchase Agreement:
"Notwithstanding anything in this Section 5.3 to the contrary, the
provisions of this Section 5.3 shall not apply and shall in no way restrict or
prohibit Xxxx Xxxxx or any Affiliate of Xxxx Xxxxx (other than Xxxxxx Services
Corporation or any of its direct or indirect subsidiaries) from operating a
business in competition with the Buyer."
2. The following sentence is hereby added as a new paragraph at
the end of Section 6.2 of the Asset Purchase Agreement:
"For purposes of this section 6.2, Seller shall include Xxxx Xxxxx or
any Affiliate of Xxxx Xxxxx who effectively acquires Xxxxxx Services Corporation
or any of its Affiliates in the event of a sale, merger, or reorganization under
the Bankruptcy Code or other combination."
3. The following provision is added as a new Section 11.4 to the
Asset Purchase Agreement:
"Sellers and/or Buyer reserve the right to terminate the Asset Purchase
Agreement if Foothill Capital Corporation ("FOOTHILL"), as agent for the
prepetition secured creditors withdraws its consent pursuant to Section 363(f)
of the Bankruptcy Code in the event the net proceeds to be received by Foothill
at Closing are less than $2.0 million. If the Agreement is terminated under this
paragraph then the Buyer shall receive a termination fee of $75,000 plus the
Break-Up Fee plus the return of the Xxxxxxx Money Deposit from Sellers' estate
as an administrative priority expense."
4. All other terms and provisions of the Asset Purchase Agreement
shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have signed this First Amendment as of
the date first above written.
"Buyer"
NOOTER CONSTRUCTION COMPANY, A
MISSOURI CORPORATION
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
"Sellers"
RMF INDUSTRIAL CONTRACTING, INC., A
MICHIGAN CORPORATION
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
DELTA MAINTENANCE, INC., A LOUISIANA
CORPORATION
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
Solely for the purposes of Sections 5.3, 5.4 and 5.5:
XXXXXX SERVICES CORPORATION, A
DELAWARE CORPORATION
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President
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