EXHIBIT 10.18
OPERATING LEASE
AGREEMENT, as below dated, by and between GREAT PLAINS ENVIRONMENTAL,
INC. ("GREAT PLAINS"), a Wyoming Corporation, and CONSOLIDATED INDUSTRIAL
SERVICES, INC. ("Consolidated"), a subsidiary of Infinity, Inc. ("Infinity"),
collectively referred to as the "Lessor", XXXXXXXX X. XXXXXXXX and XXXXXX X.
XXXXXX, individually pursuant to the personal guaranties stated herein.
RECITALS
WHEREAS, Great Plains is a start-up, Wyoming corporation formed to be
engaged in the business of wastewater treatment management, and
WHEREAS, Consolidated Industrial Services, Inc., Wastewater Division
("Consolidated Wastewater") is a division of Consolidated that is in the
business of wastewater management, and
WHEREAS, Great Plains is desirous of operating and managing the waste
water business of Consolidated, and
WHEREAS, Consolidated entered into a Production Facilities Lease with
Xxxxx and Xxxxx Xxxxxx dated June 10, 1994, for real property located near
Cheyenne, Wyoming (the "Xxxxxx Lease"), attached hereto, marked Exhibit "A"
and incorporated herein by this reference, and
WHEREAS, Consolidated entered into a real estate Lease Agreement with
Consolidated Oil Well Services, Inc., dated January 7, 1994, and amended May
4, 1994 and December 27, 1994 and extended January 8, 1996, for real property
located at Chanute, Kansas (the "COWS Lease"), attached hereto, marked Exhibit
"B" and incorporated herein by this reference, and
WHEREAS, Great Plains desires to lease and/or sub-lease certain assets
and to assume the liability of obligations on certain assets of Lessor, and
Lessor desires to lease, sub-lease and/or assign said assets or leases to
Great Plains, and
WHEREAS, Great Plains and Consolidated are willing to contract with each
other on the terms, covenants and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the payments as stated herein, the
mutual covenants, agreements, promises, terms and conditions as stated herein
and other good and valuable consideration, the amount and sufficiency of which
is acknowledged by the parties hereto, the parties agree as follows:
1. Lease of Assets: The assets of Consolidated Wastewater to be
leased are generally described as including, but not limited to machinery, and
equipment as well as all intangible assets, including, but not limited to
leases and goodwill all as described on Exhibit "C", attached hereto and
incorporated herein by this reference. Great Plains shall maintain necessary
insurance coverage, similar to coverage being maintained by Consolidated on
the leases assets as reasonably agreed by Consolidated. The specific items set
forth on Exhibit "C" and denoted as "Non Specific" shall be excluded from the
requirements of paragraph 1.1 and 14 of this Agreement and Great Plains agrees
to surrender similar quantities and qualities of items upon termination,
whether voluntary or involuntary.
EXHIBIT 10.18 Page 1
Great Plains shall sublease and assume the obligations of the Lessee of
the Xxxxxx Lease and the COWS Lease. To the extent that the terms contained in
the Xxxxxx Lease and the COWS Lease conflict with the terms of this Agreement,
the terms of this Agreement shall control.
1.1 Lessee's Duty to Maintain, Repair and Replace: Lessee shall at its
sole expense:
(a) Keep and maintain in good order, condition and repair
(including any such replacement and restoration as is required for that
purpose) the all equipment, structures and improvements upon the leased
premises, every part thereof and any and all appurtenances thereto wherever
located, including, but without limitation, the water treatment equipment and
systems, evaporation ponds, foundations, roof, exterior and interior portions
of all walls, doors, and windows, all plumbing and sewage facilities within
the lease premises, all fixtures, heating and air conditioning and electrical
systems (whether or not located in the leased premises) sprinkler system,
walls, floors and ceilings, meters applicable to Lessee's premises, and all
installations made by Lessee under the terms of this Lease and any exhibits
thereto, as herein provided; any repairs required to be made in the premises
due to burglary of the premises or other illegal entry into the premises or
any damage to the premises caused by a strike involving Lessee or its
employees. Any changes to furnish service to the premises made by any utility
company or municipality shall be paid by Lessee within time limit specified by
each utility company.
(b) Lessee shall keep and maintain the leased premises in a clean,
sanitary and safe condition and in accordance with all directions, rules and
regulations of the proper officials of the governmental agencies having
jurisdiction, at the sole cost and expense of Lessee, and Lessee shall comply
with all requirements of law, by statute, ordinance or otherwise, affecting
the leased premises and all appurtenances thereto. If Lessee refuses or
neglects to commence and to complete repairs promptly and adequately, Lessor
may, but shall not be required to, make and complete said repairs and Lessee
shall pay the cost thereof to Lessor as additional rent upon demand.
(c) Lessee shall provide Lessor 30 days advance written notice and
obtain written approval of any intended construction, renovation, improvement
or material change in the leased premises. The approval of Lessor shall not be
unreasonably withheld.
2. Term: The term of this Agreement shall be a period of five (5)
years commencing as of the date of this Agreement, unless terminated earlier
pursuant to the terms hereof.
3. Lease Term Options: At the end of the first term, Great Plains
shall have the right to extend the term of this Agreement for an additional
two years on the terms set forth below. At the end of the second term, Great
Plains shall have the right to extend the term of this Agreement for an
additional seven years on the terms set forth below. The parties agree that
this option shall be deemed fully paid for and coupled with an interest. A
lease term option shall be exercised by the written notice of Great Plains to
Consolidated at least ninety days prior to the expiration of any term. At the
end of any lease term that is not extended or where an election to purchase is
not completed, Lessee shall deliver the assets, demised premises and all
improvements thereon to Lessor, either (i) as an operating facility, in the
condition which Lessee is required to maintain under the terms of this
Agreement and transfer the surety bond and its collateral to Consolidated
immediately upon receipt of written notice or, (ii) the Lessee shall at its'
sole expense, complete the closure of the
EXHIBIT 10.18 Page 2
evaporation ponds, in accordance with the Wyoming Department of Environmental
Quality requirements and return the assets, demised premises and all
improvements thereon to the condition required upon the expiration of the
original Xxxxxx Lease, within ninety (90) days after the receipt of written
notice.
4. Compensation and Method of Payment:
(a) During the initial five year term of this Agreement, payments
shall be as follows: Quarterly payments of $20,000 ($80,000 annually) years
commencing three (3) months from the date of closing. An initial payment of
$20,000 will be made at closing which shall be applied, prorata, to the first
three quarterly payments. Great Plains shall have right to exercise a purchase
option at the Price of $800,000 at the end of this term, reduced by the
percentage rent as hereinafter described.
(b) During the first option extension (two-year) term of this
Agreement, payments shall be as follows: Quarterly payments of $21,250
($85,000 annually). Great Plains shall have right to exercise a purchase
option at the Price of $675,000 at the end of this term, reduced by the
percentage rent as hereinafter described.
(c) During the second option extension (seven-year) term of this
Agreement, payments shall be as follows: Quarterly payments of $22,250
($90,000 annually). Great Plains shall have right to exercise a purchase
option at the fair value at the end of this term, reduced by lease payments
made and the percentage rent as hereinafter described. Fair value shall be
determined by agreement of the parties based upon a reasonable inquiry and
investigation. In the event the parties cannot so agree, the parties shall
select at least one and no more that three independent arbitrators to
determine the fair value. The parties shall share equally the costs of
arbitration.
(d) Percentage rent shall be defined as prepayments on the
operating lease that shall occur at an amount equal to 4.5% of revenues over
annual revenues of $1,750,000 calculated on a quarterly basis and shall be
payable within 45 days of each quarter. The prepayment calculation shall be
based upon cumulative revenues from inception. Revenues shall be defined as
all revenue received for services provided by Great Plains, less any outside
services contracted in providing those services (specifically this definition
relates to transportation charges that may be incurred in bringing the water
to and from a treatment facility). Consolidated shall have the right to review
accounting records upon reasonable notice. In the event Great Plains is short
by more than ten percent, Great Plains shall pay the reasonable cost of the
review.
Great Plains shall provide quarterly financial statements to
Consolidated within 30 days after the close of each calendar quarter.
(e) Consolidated shall have the right to contract for trucking and
Seymour, Inc. shall have the right to contract for the manufacture of
equipment utilized or sold by Great Plains.
(f) The parties agree that any purchase option stated herein shall
be deemed fully paid for and coupled with an interest.
(g) A purchase option shall be exercised by the written notice of
Great Plains to Consolidated at least ninety days prior to the expiration of
any term.
5. Facility Leases/Assignments: Great Plains will sublease or take an
assignment of the water treatment facility at the Chanute facility, currently
EXHIBIT 10.18 Page 3
occupied by Consolidated Wastewater, from Infinity for twelve months at the
current lease rate of $1,000.00 per month beginning November 1, 1996. The
first month (November) shall be free. Great Plains shall maintain necessary
liability insurance coverage, similar to coverage being maintained by
Consolidated on the leased premises.
6. Liabilities: Great Plains shall not assume any of the existing
liabilities of Consolidated or Consolidated Wastewater or any encumbrance on
any asset that is the subject of this agreement. Further, Great Plains shall
not assume any liability for account payables. Great Plains shall assume
liability for the current lease at the Cheyenne facility as well as the
obligation on the Chrysler New Yorker automobile. Any assumed liability or
utility liability shall be prorated to the date of closing.
7. Cash Accounts, Accounts Receivable and Other Current Accounts: All
cash accounts, accounts receivable and other current accounts of Consolidated
Wastewater shall be retained by Consolidated Wastewater and shall not be
transferred to Great Plains.
8. Government Taxes and Licenses/Working Facilities: Great Plains
shall be responsible for and agrees to pay all federal, state and local taxes
and license or permit fees. Further, Great Plains agrees to obtain and
maintain in full force and effect any licenses and permits required by any
federal, state or local agency, including, but not limited to those required
by the Wyoming Department of Environmental Quality and closure bonding with
regard to the evaporative ponds upon the termination or conclusion of the
Xxxxxx lease.
Great Plains shall purchase the Consolidated US Treasury STRIP, maturing
on May 15, 2001, required as collateral for the closure bond for the Cheyenne
facility. Xxxxxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxx agree to guarantee the
difference between the value of the security and the cost of implementing the
closure plan as required by the state of Wyoming. Upon the renewal of the
closure bond, in August of 1997, the closure bond will be transferred to Great
Plains.
Great Plains shall provide its own working facilities, employees, and
materials and equipment (except as otherwise specifically noted in this
Agreement) necessary or advisable to carry out the purpose or intent of this
Agreement or the business of Great Plains. Great Plains shall pay all utility
charges and mechanic's and materials liens occurring after the date of
closing.
Infinity shall submit the appropriate and necessary documents and other
information for the transfer of the NPEDS permits as required by the
respective issuing agencies to insure an orderly and timely transition of the
permits.
9. Closing: The closing for all transactions provided for herein will
occur at the offices of Consolidated on Tuesday, October 22, 1996. The
transactions at closing, when effective, will be deemed to be effective as of
the opening of business on the day of the closing, except as otherwise
specifically provided in this Agreement. All actions to be taken at closing
will be considered to be taken simultaneously, and no document, agreement, or
instrument will be considered to be delivered until all items which are to be
delivered at the closing have been delivered. At the closing, the following
actions will occur:
(a) Certificates. Great Plains and the Lessor will each execute a
certificate stating that all representations and warranties made by them
respectively in this Agreement continue to be true at the time of closing.
EXHIBIT 10.18 Page 4
(b) Assignment. Consolidated wil1 execute and deliver to Great
Plains an assignment, in form reasonably acceptable to Great Plains, of any
leases or contracts hereunder.
(c) Records. Consolidated will deliver to Great Plains all
accounting records, customer lists, contracts, orders and other documents
relating to the wastewater treatment business, provided that Great Plains will
permit reasonable, subsequent access to such records for tax or other
appropriate reasons.
(d) Other acts. The parties will execute any other documents
reasonably necessary to carry out the intent of this agreement, including
specific transfer documents to be executed by the Lessor with respect to any
asset which may require separate documents to transfer.
10. Warranties and Representations of Lessor: Lessor warrants and
represents as follows:
(a) Corporate Status. Consolidated is duly incorporated and in
good standing under the laws of the state of Kansas. The nature of
Consolidated's business, specifically including all business activities to be
transferred hereunder, does not require the qualification of Consolidated as a
foreign corporation in any other state of country.
(b) Corporate Actions. All actions required of the Lessor,
including the execution of this Agreement and consummation of all transactions
provided for herein, have been duly authorized by appropriate actions of its
shareholders and directors,and all such agreements and instruments executed
pursuant thereto will be valid and enforceable against the Lessor in
accordance with the terms thereof.
(c) Financial Statements. The financial statements and related
data provided by Lessor to Great Plains are interim financial statements
prepared for internal use consistent with the year-end accounting using
accounting principles prepared in accordance with generally accepted
accounting principles consistently applied and are true and correct in all
material respects. There has been no material, adverse change in the Lessors
financial condition or its wastewater treatment business or operations from
August 29, 1996 to date.
(d) Absence of Liens or other Encumbrances. The assets leased or
sub-leased hereunder are free and clear of any lien, encumbrance or claim of
any nature, including liens for taxes, except as previously disclosed to Great
Plains.
(e) Material Agreements. All material contracts, leases and other
agreements to which Consolidated is a party, with reference to its wastewater
treatment business will be assigned at closing to Great Plains. Consolidated
is not in violation of any such agreements nor will the assignment and
consummation of this Agreement cause any breach of any contract or
acceleration or material change in any obligation of Consolidated which will
affect the wastewater treatment business of the assets.
(f) Litigation. Lessor is not a party to any litigation, nor to
the best of its knowledge, is any litigation threatened or pending, that
materially affects the wastewater treatment business or any assets leased or
assigned hereunder.
(g) Insurance. Consolidated has maintained full and adequate
insurance with respect to the operation of the wastewater treatment business
and all such insurance shall remain and has remained in effect through the
date of closing.
EXHIBIT 10.18 Page 5
(h) Employees. Exhibit "D", attached hereto and incorporated
herein by this reference, sets forth a complete list of the employees of
Consolidated Wastewater, the rate of compensation of each, and all benefits
applicable to each such employee. Consolidated Wastewater has no agreements
with any employee or any other obligation to any employee. Consolidated
Wastewater is not subject to any pending or threatened employee or labor
dispute.
(i) Complete Disclosure. This Agreement, and the agreements and
instruments related hereto, do not contain any untrue statement of a material
fact by Lessor. This Agreement and such related agreements and instruments do
not omit to state any material fact necessary in order to make the statements
made herein or therein, and in the light of the circumstances under which they
are made, are not misleading.
11. Warranties and Representations of Great Plains: Great Plains
warrants and represents as follows:
(a) Corporate Status. Great Plains is a corporation duly
incorporated and existing in good standing under the laws of the state of
Wyoming.
(b) Corporate and Individual Actions. Alltransactions provided for
herein and all obligations of Great Plains have been duly authorized by all
requisite corporate action, and all agreements entered into, including the
execution and consummation of this Agreement and all exhibits hereto, will be
valid and fullY enforceable aqainst Great Plains.
(c) No Conflicting Agreements. Great Plains is not a party to any
contract, agreement or other obligation which is in default or which will
becomes in default or subject to any acceleration or penalty by reason of the
execution and consummation of this Agreement.
(d) Litigation. Great Plains is not subject to any litigation or
other claim, including any governmental investigation, actual, pending or
threatened, to the best of its knowledge.
(e) Insurance. Great Plains agrees to maintain at its expense at
all times during the Lease term full liability, property damage, worker's
compensation and environmental insurance properly protecting and indemnifying
Lessor and naming Lessor as additional insured in an amount not less than as
follows:
(1) General Liability: $1,000,000 per occurrence and
$2,000,000 aqqregate.
(2) Worker's Compensation: Minimum state requirements.
(3) All Risk Property:
(4) Business Automobile Liability: $1,OOO,OOO per occurrence
bodily injury and property damage. Physical damage as required by lender.
Consolidated shall be listed as an additional insured, with waiver
of subrogation where allowed and notice of cancellation where allowed.
(f) Complete Disclosure. This Agreement, and the agreements and
instruments related hereto, do not contain any untrue statement of a material
fact by Great Plains. This Agreement and such related agreements and
instruments do not omit to state any material fact necessary in order to make
the statements
EXHIBIT 10.18 Page 6
made herein or therein, and in the light of the circumstances under which they
are made, are not misleading.
(g) Environmental Inspection. Great Plains has obtained an
environmental inspection on all real and personal property that is the subject
of this Agreement. Great Plains has disclosed such inspection report to
Consolidated and hereby certifies to Consolidated that the environmental
condition is acceptable to Great Plains. The written report, marked as Exhibit
"E", is attached hereto and incorporated herein by this reference.
(h) Equipment and Other Personal Property. Great Plains shall,
within ninety days after closing, certify to Consolidated that all personal
property leased pursuant to this Agreement is in good and satisfactory
condition. Any personal property that is not acceptable to Great Plains shall
be identified and Great Plains shall not be required to return such property
to any condition better than it was received. Upon receipt of the
certification from Great Plains, Consolidated reserves the right to inspect
the items disclosed as unsatisfactory upon the certification to verify their
condition. Should Great plains fail to provide certification within the time
allowed, all property subject to this Aqreement shall be deemed to be in
satisfactory condition.
12. Indemnification: The parties hereto agree to indemnify each other
as follows:
(a) Obligation to Indemnify. Each party will indemnify and defend
each other and its successors, affiliates, assigns and agents from and against
any and all losses, claims, damages, liabilities, costs and expenses,
including, but not limited to, attorney's fees and other expenses of
investigation and defense of any claims or actions (collectively "claims"), to
which they or any of them may become subject due to, or which results from,any
breach of the covenants, agreements, warranties and representations contained
in this aqreements.
(b) Notice. Any indemnified party shall promptly advise any
indemnifying party of the existence of any claim as soon as feasible, and in
no event later than ten days after the indemnified party becomes aware of such
actual or potential claim. Such notice shall be in writing and shall be
delivered in such manner to verify delivery by an independent third party.
13. Use of the Name of Consolidated: Great Plains acknowledges,
consents and agrees that it is not authorized to and shall not use the name of
Consolidated.
14. Default:
(a) Lessee's Default: Failure on the part of Lessee to pay any
amounts payable under the terms of this Agreement or, failure of Lessee to
promptly and faithfully keep and perform every covenant, condition, agreement
and obligation of this Agreement for more than twenty (20) days after written
notice of such default shall have been given to Lessee, shall constitute an
event of default under the terms of this Agreement. Upon the occurrence of an
event of default, Lessor, at its' option may, cause the forfeiture of this
Agreement, without, however, releasing Lessee from liability for its'
obligations under the terms of this Agreement. Lessor may demand immediate
possession of the assets, demised premises and all improvements thereon and
Lessee shall deliver the same to Lessor, either (i) as an operating facility,
in the condition which lessee is required to maintain under the terms of this
Agreement, immediately upon receipt of written notice or, (ii) the Lessee
shall at its' sole expense, complete the
EXHIBIT 10.18 Page 7
closure of the evaporation ponds, in accordance with the Wyoming Department of
Environmental Quality requirements and return the assets, demised premises and
all improvements thereon to the condition required upon the expiration of the
original Xxxxxx Lease, within ninety (90) days after the receipt of written
notice. Thereupon Lessor shall be entitled to and may take immediate
possession of the premises, any other notice or demand being hereby waived.
Lessee agrees to quit and deliver possession of the demised premises to Lessor
or Lessor's assigns, successors or agents, when this Agreement terminates by
limitation or forfeiture, and Lessee agrees that the premises shall be in
substantially the same order and in as good condition as received, subject to
the maintenance, repair and replacement requirements of this Aqreement.
(b) Lessee's Continuing Obligations: Lessee covenants, that any
forfeiture, annulment or voidance of this Agreement shall not relieve Lessee
from its' obligations hereunder, including the obligation to make quarterly
payments of rent. In case of default of Lessee, Lessor may relet the premises
as the agent for and in the name of Lessee, at any rental readily acceptable,
applying the proceeds first to the payment of such rent as same becomes due,
and toward the fulfillment of the other covenants and agreements of Lessee
herein contained, and the balance, if any, shall be paid to Lessee, and Lessee
hereby agrees that if Lessor shall recover or take possession of said premises
as aforesaid, and be unable to relet and rent the same so as to realize a sum
equal to the rent hereby reserved, Lessee shall pay to Lessor any loss or
difference of rent for the residue of the term.
(1) Lessor shall have the right to re-enter the premises to
assume and take possession of the whole or any part thereof, and to remove all
persons or personal property by direct or summary action, or in a different
type of suit or proceeding, by force, or otherwise, without being deemed
guilty of trespass or other actionable wrong by reason thereof, and without
being liable for the damages therefore or in connection therewith, and, after
demand made therefore, Lessee or anyone in possession claiming under Lessee
shall be deemed guilty of unlawful detainer and subject to such summary or
other action as may be provided by law; and
(2) Lessor, irrespective of the date on which its right of
re-entry shall have accrued or be exercised, shall have the right, exercisable
without notice to or demand upon Lessee or any other person, whether for rent
or possession or otherwise, to forfeit this Agreement and t~rm~n~te the estate
of Lessee hereby created.
(3) In any and every event, Lessor shall not be deemed to
have accepted any surrender of the demised premises or of the leasehold estate
created hereby from Lessee, or anyone acting in Lessee's behalf, unless Lessor
by an agreement in writing shall declare explicitly that it intends thereby to
effect acceptance of the surrender and to release Lessee from liability.
(c) Legal Remedies: Notwithstanding the provisions of this
Agreement, it is agreed between the parties that the remedies provided for
herein in the event of default on the part of Lessee are in addition to and
not in lieu of any other remedies or relief made available to Lessor under the
laws of the State in which the premises are located, which latter remedies or
relief shall be likewise available to Lessee in the event of a breach of any
of the terms of this Agreement.
(d) Lessor's Default: The failure of any covenant, agreement,
representation and warranty of Lessor, under the terms of this Agreement on
the part of Lessor to be kept and performed for more than twenty (20) days
after written notice of such breach shall have been given to Lessor, shall
constitute
EXHIBIT 10.18 Page 8
an event of default under the terms of this Agreement.
It is agreed between the parties that the Lessee shall be entitled to
pursue any remedies or relief made available to Lessee under the laws of the
State in which the premises are located.
15. Independent Operator: Consolidated hereby contracts with Great
Plains as an independent lessee/operator to lease certain assets of and to
assume certain leases of and to operate and manage the wastewater treatment
business of Consolidated Wastewater. Nothing herein shall be construed as
creating an agency or employer-employee relationship between the Great Plains
and Consolidated.
16. Not a Franchise/Investment Contract: Great Plains and Consolidated
acknowledge, consent and agree that this Agreement and resulting relationship
is not and shall not be construed as a franchise or an investment contract.
17. Finder's Fees/Commissions: The parties represent and warrant that
they have not incurred any obligation for any sales commission, brokerage fee,
finder's fee or other similar obligation in connection with the transactions
provided for herein for which the other party may have any liability or
adverse claim.
18. Covenant Not to Compete: During the term of this Agreement,
Consolidated and Infinity, its successors or assigns, will not directly or
indirectly own, manage, operate, join, control, be employed by, or participate
in the ownership, management, operation, or control of or be connected in any
manner, including but not limited to the positions of shareholder, director,
officer, consultant, independent contractor, employee, partner or investor,
with any industrial wastewater treatment business that is located in or
conducts business the states of Kansas, Wyoming, Colorado, Oklahoma, Texas,
Nebraska, Missouri or Utah. Consolidated reserves the ability to conduct all
aspects of oil field services business, including oil field water hauling and
disposal.
During the term of this Agreement, Great Plains and Xxxxxxxx X.
Xxxxxxxx, his affiliates or agents, will not directly or indirectly own,
manage, operate, join, control, be employed by, or participate in the
ownership, management, operation, or control of or be connected in any manner,
including but not limited to the positions of shareholder, director, officer,
consultant, independent contractor, employee, partner or investor, with any
industrial wastewater treatment business that is located in or conducts
business the United States unless such activity is brought under the terms and
conditions of this agreement.
19. Best Efforts: Great Plains agrees that it will at all times,
faithfully, industriously and to the best of its ability, experience and
talent perform all of the duties that are normal and customary regarding the
management and operation of a wastewater treatment and facility or business.
20. Reimbursement of Expenses: Except as otherwise stated herein,
Great Plains shall not be reimbursed for expenses incurred.
21. Reasonableness: The parties acknowledge, consent and agree that
each covenant contained herein, and specifically regarding the non-competition
agreement, serves a legitimate business purpose and is reasonable in duration
and scope and is no wider geographically than necessary to afford the required
protection to the parties.
22. Survival: The covenants contained herein shall be construed as
independent of each other and any other agreements between the parties and
shall survive the termination of this Agreement.
EXHIBIT 10.18 Page 9
23. Cooperation: The parties will not perform or do any act which is
prejudicial or injurious to the business or goodwill of the other and shall
make no public comment which could be construed as adverse to or critical of
the other.
24. Notices: All notices required or permitted hereunder or under any
related agreement or instrument, will be deemed delivered when delivered to
the parties at the address below-stated in the signature section of this
Agreement (or as amended by appropriate notice) in a manner sufficient to
verify delivery by an independent third party.
25. Assignability. This agreement and the right and duties created
herein, express or implied, shall not be assignable by any party without the
express, unanimous and written consent of the parties hereto, except that the
rights of Consolidated may be pledged or assigned to or assumed by Seymour,
Inc., or its successors.
26. Miscellaneous: No waiver or modification of this Agreement or any
term, covenant, condition or limitation contained herein shall be valid unless
in writing and duly executed by the party to be charged therewith, and no
evidence of any waiver or modification shall be offered or received in
evidence of any proceeding, arbitration, or litigation between the parties
hereto arising out of or affecting this Agreement, or the rights or
obligations of the parties hereunder, unless such waiver or modification is in
writing, duly executed as aforesaid, and the parties further agree that the
provisions of this section may not be waived except as herein set forth.
It is the intention of the parties hereto that this Agreement, and the
performance hereunder and all suits and/or special proceedings hereunder be
construed and enforced in accordance with and pursuant to the laws of the
State of Kansas, and that in any action, special proceeding or other
proceeding that may be brought arising out of, in connection with, or by
reason of this Agreement, the laws of the State of Kansas shall be exclusively
applicable and shall qovern to the exclusion of the law of any other forum.
The parties agree that the exclusive procedure to be used to settle a
dispute under this agreement shall be Arbitration and not by other court
proceeding. Such Arbitration shall be conducted pursuant to the rules and
procedures of the American Arbitration Association and shall be conducted at a
location mutually agreeable to the parties. The parties expressly waive their
rights seek redress in the courts to settle any such dispute. Any decision of
an arbitrator shall become and order and judgment of the court havinq
a~rooriate jurisdiction.
This Agreement shall be binding upon and inure to the benefit of the
parties signatory hereto, their successors, personal representatives and
assigns. Should any provision hereof be held invalid, the remainder of this
Agreement shall not be affected thereby.
This Agreement contains the entire understanding of the parties and
supersedes any prior understanding and/or written or oral agreements. All
representations and agreements, whether oral or written, are contained herein.
In the event it becomes necessary or advisable for either party to seek
legal advice or enter into any legal proceedings to enforce any clause or term
of this Agreement, the prevailing party shall be allowed to recover any costs
or expenses of such advice or oroceedinq, includinq a reasonable amount for
attorney's fees.
EXHIBIT 10.18 Page 10
27. Personal Guaranty: This agreement is personally guaranteed by
Xxxxxxxx X. Xxxxxxxx for three years or $250,000. The $250,000 shall not be
reduced by the initial $20,000 down payment, but shall be reduced and released
dollar for dollar, by other payments made, including percentage rent payments.
Equity and sub-debt shall also count against the guaranty, but shall not be
calculated in the release of such guaranty. Consolidated agrees to subordinate
the guaranty for debt incurred to increase capital or equipment. Should the
equity and sub-debt of Great Plains fall below $250,000, Great Plains
covenants not to distribute any dividends to shareholders and Xxxxxxxx X.
Xxxxxxxx'x compensation will he limited to no more than $60,000.
Dated this 22nd day of October 1996. Dated this 22nd day of October 1996
CONSOLIDATED INDUSTRIAL SERVICES, INC. GREAT PLAINS ENVIRONMENTAL, INC.
By:/s/ Xxxx X. Xxxxxxxx By:/s/ Xxxxxxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx, Secretary Xxxxxxxx X. Xxxxxxxx, President
By:/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx, Vice President,
Operations
INFINITY, INC. By:/s/ Xxxxxxxx X. Xxxxxxxx
Xxxxxxxx X. Xxxxxxxx, Individually
By:/s/ Xxxx X. Xxxxxxxx (Pursuant to Personal Guaranty
Xxxx X. Xxxxxxxx, Secretary Stated Herein)
By:/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx, Individually
(Pursuant to Personal Guaranty
Stated Herein)
EXHIBIT 10.18 Page 11
XXXX OF SALE
Consolidated Industrial Services, Inc., Wastewater Division,
("Consolidated") (the "grantor"), a Kansas corporation, whose address is 000
Xxxx 00xx Xxxxxx, Xxxxxxx, Xxxxxx 0000X, in consideration of $10,200.00 paid
to it by Great Plains Environmental, Inc. (the "grantee"), whose address is
0000 Xxxx Xxxxx, Xxxxx 000, Xxxxxx, XX 00000, receipt of which is
acknowledged, does grant, bargain and sell to the grantee, the following
described personal property:
See Attached Exhibit A
The grantor covenants with the grantee that it is the lawful owner of
the personal property; that the property is free and clear of all liens and
encumbrances, except as set forth on Exhibit A, attached hereto and made a
part hereof; that it has the full right to sell and transfer the property and
that it will warrant and defend the title to the above-described property for
the benefit of the grantee and its legal representatives, successors and
assigns.
Purchase Price
Subject to the terms and conditions of this Agreement and in reliance on
the representations and warranties of the grantor contained herein, grantee is
purchasing, certain of grantor's assets and in full consideration therefore,
will pay grantor $10,200.00 and assume the note on the 1994 Chrysler New
Yorker, SN - 0X0XX00X0XX000000. Said purchase price shall be allocated as
follows:
$9,200.00(1) to Equipment;
$ 500.00 to Customer Lists, Raw Materials, Work in
Process, Finished Goods and Records;
$ 500.00 to Inventory;
The purchase price shall be payable as follows: $10,200.00 in certified
funds at closing payable to grantor.
_________________
(1) plus the amount of the bank note for the Chrysler New Yorker
In witness, the secretary of the grantor have signed this xxxx of sale
on 22nd day of October, 1996.
CONSOLIDATED INDUSTRIAL SERVICES, INC.
WASTEWATER DIVISION
By:/s/ Xxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx, Secretary
STATE OF KANSAS )
) ss.
COUNTY OF XXXXXXX )
This instrument was acknowledged before me on October 22, 1996 by Xxxx
X. Xxxxxxxx as the secretary of Consolidated Industrial Services, Inc.,
Wastewater Division.
Witness my hand and official seal.
/s/ Xxxxx X. Xxxxxx
Notary
My commission expires: December 10, 1997
Consolidated Industrial Services Inc.,
Wastewater Division -- Asset Listing Report
Operation Location Qty Item Description Model Serial#
Chanute 1 Truck, pickup 1984 0XXXX00X0XX000000
Cheyenne 1 Heater, used oil RA14D/235
Cheyenne 1 Truck, pickup 1991 0XXX000X0X0000000
Topeka 1 Chrysler New Yorker
(Continued)
Operation Date Mfg Lease/Purchase
Chanute Chevy Purchase
Cheyenne Purchase
Cheyenne Chevy Purchase
Topeka Chrysler Purchase
AGREEMENT TO PURCHASE CERTAIN ASSETS OF
CONSOLIDATED INDUSTRIAL SERVICES, INC., WASTEWATER DIVISION,
A SUBSIDIARY OF INFINITY, INC.
Agreement dated as below, between Consolidated Industrial Services,
Inc., Wastewater Division, ("Consolidated"), a Kansas corporation and a
subdivision of Infinity, Inc. ("Infinity"), a Colorado corporation,
(collectively referred to as the "Seller"), and Great Plains Environmental,
Inc., a Wyoming corporation (the "Buyer").
Seller and Buyer agree as follows with respect to the sale by Seller and
the purchase by Buyer of certain assets, tangible and intangible, and business
of Seller.
Buyer is satisfied that it has adequate financial information about
Seller. Seller is satisfied that it has adequate financial information about
Buyer.
Seller covenants that it has good and marketable title to all assets to
be sold, subject to no mortgage, pledge, lien, conditional sales agreement,
encumbrance or charge, except as set forth on Exhibit A, attached hereto.
Seller covenants that there is no litigation pending, or to the
knowledge of Seller threatened, against or relating to Seller, its properties
or business.
Purchase Price
Subject to the terms and conditions of this Agreement and in reliance on
the representations and warranties of the Seller contained herein, Buyer will
purchase, at the Closing, certain of Seller's assets and inventory, and in
full consideration therefore, will pay Seller $10,200.00 and assume the note
on the 0000 Xxxxxxxx Xxx Xxxxxx, XX 0X0XX00X0XX000000. Said purchase price
shall be allocated as follows:
$ 9,200.00(1) to Equipment;
$ 500.00 to Customer Lists, Raw Materials,
Work in Process, Finished Goods and Records;
$ 500.00 to Inventory;
__________
(1) plus the amount of the bank note for the Chrysler New Yorker
The purchase price shall be payable in certified funds at closing
payable to Consolidated Industrial Services, Inc.
Assets to be Purchased: The assets to be purchased are described on
Exhibit "A" attached hereto free and clear of all liabilities, obligations,
liens and encumbrances, except as set forth on Exhibit "B".
Conveyance and Transfer. At Closing Seller shall deliver to Buyer a Xxxx
of Sale.
Closing. The Closing of such sale and purchase shall take place at
Chanute, Kansas on October 22, 1996, or at such other date, time and place as
the parties may agree (herein called the "Closing"). At the Closing, Buyer
will deliver to Seller a certified or bank cashier's check in the amount of
the purchase price.
Taxes. Buyer will pay all sales, transfer and documentary taxes, if
any, payable in connection with this Agreement and the conveyances,
assignments, transfers and deliveries to be made to Buyer hereunder.
Accounts Receivable. The Seller shall retain all accounts receivables
to day of closing and pay all accounts payable to day of closing.
Parties in Interest. All the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective heirs and legal representative of the partners and the successors
and assigns of Buyer.
Law to Govern. This Agreement is being made in Kansas and shall be
construed and enforced in accordance with the laws of that State.
Attorney Fees. In the event it becomes advisable or necessary for
either party to this Agreement to seek legal advice or enter into any
proceeding hereof, the prevailing party shall be entitled to recover all costs
and expenses of such advice or proceeding, including a reasonable amount for
attorney fees.
Notices. All notices shall be in writing and shall be deemed to have
been duly given if delivered personally or if mailed via registered mail,
postage prepaid, to the party at his address set forth at the end of this
Agreement.
Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
Great Plains Environmental, Inc.
By:/s/ Xxxxxxxx X. Xxxxxxxx
Xxxxxxxx X. Xxxxxxxx, President
Consolidated Industrial Services, Inc.
By:/s/ Xxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx, Secretary
