Exhibit 2.1
AGREEMENT
THIS AGREEMENT is made as of December 15, 2000, by and among
Xxxx Xxxxx Trucking, Inc., a Utah corporation ("Simon"); Westway Express,
Inc., an Indiana corporation (the "Company"); WesternWay Holdings Co., a
Colorado corporation, the Company's sole shareholder ("Shareholder"); and Xxxxx
X. XxXxxxxx ("XxXxxxxx").
RECITALS
The Company is a trucking company and the owner of certain assets. The
Company has determined not to continue in the trucking business. The Company
proposes to sell and Simon proposes to acquire only a limited portion of the
Company's assets. Simon will integrate the portion of the Company's assets it is
acquiring into its own trucking operations to facilitate the expansion of its
business. Simon is expressly not assuming any pre-closing liabilities of the
Company, Shareholder, or any Affiliate (as hereinafter defined) with regard to
such acquisition of assets. The parties desire to reduce their agreement to
writing and make certain other agreements as set forth herein.
XxXxxxxx is joining as a party to this Agreement solely in connection
with the provisions of Sections 1.7, 3, 5.5, 5.6, 6, 7.1, 7.6, 8.2.4, 9, 10, 11,
and 12 below, and shall not be deemed to be a party to the Agreement for any
other purpose.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants, representations, and warranties herein contained, and upon the
terms and conditions hereinafter set forth, the parties hereto agree as follows:
TERMS
1. Purchase and Condition of Assets; Lease of Property.
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1.1 Purchase of Specific Assets. At the Closing, the Company
shall sell to Simon and Simon shall purchase for the price set forth on
Exhibit A attached hereto (the "Purchase Price"), the assets listed on
Exhibit A (collectively, the "Transferred Assets") free and clear of
all liens, claims, encumbrances, security interests, and impairments of
title of any kind or nature ("Liens"), except for Liens to be retired
pursuant to Section 1.1(i) hereof. Simon shall deliver the Purchase
Price, by certified funds or wire transfer of immediately available
funds, as follows: (i) the amount required to retire all obligations
and remove all Liens relating to the Transferred Assets (the "Payoff
Amount") shall be paid to the respective holders, as set forth in the
Payoff Letters, as defined in Section 7.4, (ii) the balance of the
Purchase Price, if any, shall be delivered to the Company at the
Closing, and (iii) the amount of the useable portion of any prepaid
licenses and permits on the Transferred Assets, Leased Equipment, and
Subleased Equipment as of the Closing being added to the Purchase Price
and delivered to the Company at the Closing ((ii) and (iii) being
referred to as the "Cash Purchase Price" (with the portion of any
prepaid license or permit later determined to be invalidly transferred
being refunded by the Company to Simon and subject to set-off if not
refunded). The parties agree that the Purchase Price, the Recruitment
Assistance Fee and all other costs that are capable of being
capitalized shall be allocated among the Transferred Assets as set
forth on IRS Form 8594 attached hereto as Exhibit B.
1.2 Recruitment Assistance Fee Payment; Driver Retention.
Simon shall pay to the Company for its services in assisting with
Simon's hiring of the Company's drivers the following amounts (the
"Recruitment Assistance Fee Payment"):
1.2.1 At the Closing, $1,000,000 shall be
delivered; and
1.2.2 On March 1, June 1, September 1, 2001, and the
day immediately preceding the first anniversary of the date of
this Agreement, $325,000 shall be delivered to the Company on
each such date.
If within the thirty days following the Closing fewer than 400
employee and independent contractor drivers fail to qualify for and
accept employment or an independent contractor contract with Simon on
at least the same compensation and benefits package as provided by the
Company, considering the package as a whole, the Recruitment
Assistance Fee Payment (starting with the first remittance on March 1,
2001, and continuing in the order such payments become due) shall be
reduced by $2,500 multiplied by the number of such drivers is less
than 400. Such amount will be eligible for set-off under
Section 10.9 hereof.
1.3 Inspection. For the period commencing with the execution
of this Agreement and continuing through Closing, the Company shall use its
best efforts to direct all tractors and trailers included in the Subleased
and Leased Equipment to a Company terminal at which a Simon representative
and a Company representative are present to inspect the condition of such
assets. Prior to Closing, the parties shall inspect the Transferred Assets
to verify they are in good repair and condition, ordinary wear and tear
excepted. The parties shall use their reasonable best efforts to conduct
such inspections within two (2) weeks from the date of this Agreement.
1.4 Condition of Subleased and Leased Equipment. With respect
to trailers included in the Subleased Equipment, any damage to such trailers
shall be photographed by Simon and deviations from turn-in condition
recorded in a written exception report. The Company, at its expense, shall
promptly repair any trailers included in the Subleased Equipment that are
not roadworthy and operable, or, at its option, delete such unit from the
Subleased Equipment, and the sublease payment shall be reduced by the amount
allocable to such deleted equipment. Simon shall return all Subleased
Equipment to the location specified in the underlying lease at the end of
the underlying lease relating to the Subleased Equipment (i) in
substantially the same condition as when received, reasonable wear and tear
excepted, or (ii) promptly remit to the Company the amount necessary to
bring such trailers into the required condition, taking into account the
condition of the trailers as set forth in the photographs and written
exception report. With respect to tractors included in the Leased Equipment,
such tractors at Closing must be in good repair and condition and satisfy
the turn-in requirements under the underlying lease, pro-rated, with respect
to mileage, for the period of the lease that has expired. If any tractor
does not meet these conditions, the Company, at its expense, shall repair
such tractor to bring it into the required condition before Closing or, at
the Company's option, (i) retain such equipment and, such equipment shall be
excluded from the Leased Equipment, or (ii) the Recruitment Assistance Fee
Payment or the Purchase Price shall be reduced by the amount mutually
determined by Simon and the Company as necessary to bring such equipment
into the required condition or if the parties cannot agree, such amount will
be determined by a third party repair or body shop.
1.5 Condition of Transferred Assets. If Simon and the Company
have determined that the Transferred Assets are not in good repair and
condition, ordinary wear and tear excepted, the Purchase Price payable
at Closing shall be reduced by the amount agreed to by Simon and the
Company. In the absence of agreement, the asset shall be deleted from
the Transferred Assets and the Purchase Price shall be reduced by the
amount allocable to such equipment. Except as set forth herein, the
Transferred Assets are comprised of used assets and are sold as is
where is, with no warranties or representations either expressed or
implied as to the condition or fitness of the Transferred Assets for
their intended use. Each of the Transferred Assets is owned by the
Company free and clear of all Liens other than Liens represented by
Payoff Letters (as hereinafter defined).
1.6 Sales or Use Tax. Simon shall be responsible for and pay
any and all applicable sales or use taxes arising from the purchases
under this Agreement and shall indemnify, defend, and hold the Company
and Shareholder harmless from any claim or liability arising in
relation thereto as provided in Section 10.4 hereof.
1.7 Customer Lists. Simon understands that any existing
customers of the Company may or may not do business with Simon after the
Closing, as determined solely by each such customer. No representations or
warranties are made regarding the retention of such customers by Simon or
the manner or volume of use of Simon, if any, by such customers; provided,
the Company, Shareholder, and XxXxxxxx shall use their reasonable best
efforts to cause such customers to use the services of Simon.
1.8 Risk of Loss. Subject to Section 9.1 and notwithstanding
Section 1.3, 1.4, or 1.5, the Company shall bear the risk of loss and
repair to the Transferred Assets, Leased Equipment and Subleased
Equipment prior to the Closing, including the cost of repair for
material damage or restoration to operating condition where such
material damage or cessation of operation occurs prior to the Closing;
provided however, in lieu of repair or restoration, at Simon's option
it may (i) require the Company to, and the Company shall, assign to
Simon proceeds of any insurance claim which are deemed adequate by
Simon to repair or restore the damage, and Simon shall accept the
damaged equipment, (ii) in the case of Transferred Assets, reject, and
the Company shall retain the damaged equipment together with any
insurance claims and reduce the Purchase Price by the amount of the
Purchase Price allocable to such Transferred Assets, or (iii) in the
case of Leased Equipment or Subleased Equipment, reject, and the
Company shall retain the damaged equipment and such equipment shall not
be the subject of any lease or sublease. If such equipment is retained
by the Company, the Company will indemnify, defend, and hold Simon
harmless from any lease obligations with respect to such damaged
equipment as provided in Section 10.2 hereof. Subject to Section 9.1,
Simon shall bear the risk of loss to the Transferred Assets, Subleased
Equipment, and Leased Equipment after the Closing.
1.9 Albuquerque Lease. Simon shall lease the property owned by
the Company in Albuquerque, New Mexico through June 30, 2001, at a
monthly rental of $12,500, with Simon to pay utilities, taxes,
insurance, and upkeep arising in the ordinary course of business,
pursuant to the lease attached as Exhibit C (the "Lease"). The Lease
shall provide Simon with a right of first refusal on any sale of the
subject property during the term, or prior to the expiration, of the
Lease.
2. Representations of the Company and Shareholder. The Company
and Shareholder, jointly and severally, represent and warrant the
following:
2.1 Corporate Approvals. The Company is a duly formed, validly
existing Indiana corporation, with full power and authority to enter
into this Agreement by and through the officer executing his name
hereto, and any corporate approvals required will have been obtained at
or prior to the Closing, including, but not limited to, requisite
approvals of the Board of Directors and of the Company and the
Shareholder.
2.2 Authorizations. At and as of the Closing, all corporate,
governmental, and other actions (other than those to be taken by Simon)
will have been duly taken to approve and authorize the execution and
delivery of this Agreement, the transfer of the Transferred Assets at
the Closing, the assignment of the Assigned Equipment Leases and the
Assigned Real Estate Leases, the sublease of the Subleased Equipment,
the performance and consummation by the Company and Shareholder of the
transactions contemplated herein, and the execution and delivery of all
documents required hereunder and incidental hereto. As of the Closing
the Company and Shareholder will have obtained all consents of third
parties required to transfer the Transferred Assets, assign the
Assigned Equipment Leases and the Assigned Real Estate Leases, sublease
the Subleased Equipment, and taken the other actions required of the
Company and Shareholder under this Agreement. Except as listed on the
Disclosure Schedule attached as Exhibit D (the "Disclosure Schedule"),
the execution, delivery, and performance of this Agreement by the
Company and Shareholder will not result in violation of, or a default
under, any agreement, charter document, or other obligation to which
either is a party or by which either may be bound. This Agreement
constitutes the valid and binding obligation of the Company and
Shareholder and is enforceable in accordance with its terms, subject to
the effect of bankruptcy, insolvency, reorganization, moratorium, or
other similar laws relating to creditors' rights generally and general
equitable principles, and subject to such approval of regulatory
agencies and other governmental authorities having authority over the
Company or Shareholder as may be required by statute or regulation.
2.3 Financial Statements. The Company, not later than five (5)
days preceding the Closing, will have delivered to Simon copies of its
balance sheet and the related statements of earnings and retained
earnings and of changes in financial position at and for the periods
ended December 31, 1998 (audited), and 1999 (audited), and September
30, 2000 (unaudited). The revenue depicted in such financial statements
accurately represents the business conducted by the Company for the
respective periods to which they relate.
2.4 Operating Information. The Company has provided to Simon
certain operating information, rates charged customers, miles per
tractor, empty miles, and other information. All of such information is
accurate in all material respects and fairly depicts the operations
represented by such information.
2.5 No Changes. Since December 31, 1999, and except for (a)
disclosures on the Disclosure Schedule, (b) the loss of major
customers, (c) events occurring in the ordinary course of business of
the Company, and (d) events adversely affecting the trucking industry
in general, the Company has not experienced any materially adverse
event, including, but not limited to, (i) materially adverse events
which could cause liability to Simon, (ii) materially adverse events
which could result in loss of revenue to Simon, (iii) a notification of
efforts to organize employees in a collective bargaining unit, or (iv)
loss of employee and independent contractor drivers such that the total
number of drivers of the Company is less than 300.
2.6 Litigation. Except as provided on the Disclosure Schedule,
there is no material action, suit, proceeding, demand, claim,
assessment, judgment, litigation, lien, claim, or governmental
investigation against the Company or Shareholder, or otherwise
outstanding, pending, or, to their knowledge, threatened which (i)
questions or might question the validity or legality of the
transactions contemplated hereby, (ii) seeks or might seek to enjoin
any transaction contemplated hereby, (iii) seeks or might seek damages
on account of the consummation of any transaction contemplated hereby,
(iv) seeks or might seek to impair or place a lien on the Transferred
Assets, Subleased Equipment, or Leased Equipment, or (v) seeks damages
from the Company (other than claims for which the Company is fully
insured). Neither the Company nor Shareholder is the subject of any
claim involving any employment or tax matter, nor is the Company or
Shareholder aware of any factual basis of such a claim.
2.7 No Default. Except as provided on the Disclosure Schedule
or as to the condition of the Transferred Assets, Leased Equipment, and
Subleased Equipment under Sections 1.3, 1.4, and 1.5, the Company is
not in material default under any contract, agreement, license,
franchise, lease, permit, or other document which might affect Simon's
rights thereunder if assigned to Simon, the Transferred Assets,
Subleased Equipment, or Leased Equipment, or any performance hereunder.
2.8 No Restriction. Except as provided on the Disclosure
Schedule, neither the Company nor Shareholder is a party to, or subject
to or bound by, any judgment, injunction, or decree of any court or
governmental authority that restricts or prohibits the performance by
the Company and Shareholder of the terms and conditions of this
Agreement.
2.9 Taxes. There are no tax liens attached to the Transferred
Assets, Leased Equipment, or Subleased Equipment. The Company has
complied in all material respects with all applicable laws, rules, and
regulations relating to the payment and withholding of taxes and has,
within the time and in the manner prescribed by law, withheld from
employee wages and paid over to the proper governmental authorities all
amounts required to be so withheld and paid over under all applicable
laws.
2.10 Compliance With Laws. All of the Company's rolling stock
is properly licensed and registered with all applicable authorities in
accordance with normal industry practices, such licenses and
registrations are current, all current license plates and stickers are
properly affixed to such equipment, and all fees have been paid.
2.11 Compliance Reviews. The Company currently has a
"satisfactory" safety and fitness rating from the Federal Highway
Administration ("FHWA") as a result of its most recent compliance
review. The Company did not receive an unsatisfactory or conditional
rating for any of the factors that are considered by FHWA in
determining a carrier's safety fitness rating. The Company is in
compliance in all material respects with all Federal Motor Carrier
Safety Regulations and Hazardous Materials Regulations. The Company
prior to Closing will have provided Simon with access to all of its
driver files and all information relating to its compliance review and
related action by the FHWA.
2.12 Intentionally omitted.
2.13 Drivers; Employees.
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2.13.1 The Company is not a party to any collective
bargaining agreement relating to its employees, nor does any
such agreement determine the terms and conditions of
employment of any such employee. In the past five years there
has not been any organized labor unrest or union organizing
activity involving the Company.
2.13.2 Except as set forth on the Disclosure
Schedule, the Company is not a party to an employment contract
with any employee, and there are no agreements, plans, or
policies that would give rise to any severance, termination,
change-in-control, accrued vacation, or other similar payment
to employees or independent contractors of the Company as a
result of the consummation of this Agreement (the Company will
pay any such claims if it determines it is so obligated).
2.13.3 The Disclosure Schedule identifies each of the
Company's employee benefit plans, including all retirement,
profit sharing, defined contribution, and defined benefit
plans, as well as any severance, vacation pay, health and
welfare, employment, or other agreements (oral or written)
relating to employees of the Company (collectively, "Plans").
Except as set forth on the Disclosure Schedule, no Plan is a
multi-employer or a defined benefit plan, and neither the
Company nor any predecessor or Affiliate (which for all
purposes in this Agreement means any person or entity
controlling, controlled by, or under common control with
another person or entity) of the Company or a predecessor has
ever been a party to or sponsored a multi-employer or defined
benefit plan. Except as set forth on the Disclosure Schedule,
the Company is not a member of a group of businesses under
common control or businesses constituting a single employer (a
"Group"), except a Group in which no member has been a party
to a defined benefit plan, nor, except as set forth on the
Disclosure Schedule, does the Company have any current or
projected liability with respect to post-employment or
post-retirement pension benefits for former or retired
employees of the Company, affiliated entities, or a member of
a Group.
2.13.4 The Company maintains files on all employee
drivers and independent contractors, and each employee driver,
independent contractor, and file meets all DOT requirements.
2.13.5 Independent contractor contracts, to the
extent assignable, may be assumed by Simon, in its sole
discretion. The Company makes no representation or warranty
regarding the assignability of such contracts, the
enforceability of any assignment of such contracts, or the
willingness of such independent contractors to perform on
behalf of Simon. Simon acknowledges that such independent
contractors may or may not honor their contracts and the
Company shall not be responsible or liable in any way for any
failure of such contract or assignment, or the failure by an
independent contractor to perform thereunder, but the Company
will use reasonable best efforts to help Simon retain such
independent contractors.
2.14 Environment, Health, and Safety. With regard to its
leased or owned premises which Simon will assume or lease, the Company
has complied with all laws concerning pollution or protection of the
environment, all laws concerning public health and safety, and all laws
concerning employee health and safety, including laws relating to
emissions, discharges, releases, or threatened releases of pollutants,
contaminants, or chemical, industrial, hazardous, or toxic materials or
wastes (including petroleum and any fraction or derivative thereof)
into ambient air, surface water, ground water, or lands, or otherwise
relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport, or hauling of such substances
(collectively, "Environmental Laws"), and no action, suit, proceeding,
hearing, investigation, charge, complaint, claim, demand, or notice has
been filed or commenced against it alleging any failure so to comply,
nor is the Company or Shareholder aware of any factual basis therefor.
The Company has obtained and been in compliance with all of the terms
and conditions of all material permits, licenses, franchises, and other
approvals ("Permits") required under all Environmental Laws.
3. Representations of XxXxxxxx. Except as set forth on the
Disclosure Schedule, XxXxxxxx, to his knowledge, represents and warrants the
following:
3.1 Taxes. There are no tax liens attached to the Transferred
Assets, Leased Equipment, or Subleased Equipment. The Company has
complied in all material respects with all applicable laws, rules, and
regulations relating to the payment and withholding of taxes and has,
within the time and in the manner prescribed by law, withheld from
employee wages and paid over to the proper governmental authorities all
amounts required to be so withheld and paid over under all applicable
laws.
3.2 Employee Benefits. The Disclosure Schedule identifies each
of the Company's Plans. Except as set forth on the Disclosure Schedule,
no Plan is a multi-employer or a defined benefit plan, and neither the
Company nor any predecessor or Affiliate of the Company has ever been a
party to or sponsored a multi-employer or defined benefit plan. Except
as set forth on the Disclosure Schedule, the Company is not a member of
a Group, except a Group in which no member has been a party to a
defined benefit plan, nor, except as set forth on the Disclosure
Schedule, does the Company have any current or projected liability with
respect to post-employment or post-retirement pension benefits for
former or retired employees of the Company, affiliated entities, or a
member of a Group.
3.3 Environment, Health, and Safety. With regard to its leased
or owned premises which Simon will assume or lease, the Company has
complied with all Environmental Laws, and no action, suit, proceeding,
hearing, investigation, charge, complaint, claim, demand, or notice has
been filed or commenced against it alleging any failure so to comply
nor does XxXxxxxx have knowledge of any factual basis therefor. The
Company has obtained and been in compliance with all of the terms and
conditions of all Permits required under all Environmental Laws.
3.4 Authorizations. At and as of the Closing, all governmental
and other actions required of XxXxxxxx will have been duly taken to
approve and authorize the execution and delivery of this Agreement by
XxXxxxxx and the performance and consummation by XxXxxxxx of the
transactions contemplated herein, and the execution and delivery of all
documents required of XxXxxxxx hereunder and incidental hereto. Except
as listed on the Disclosure Schedule, the execution, delivery, and
performance by XxXxxxxx of this Agreement will not result in violation
of, or a default under, any agreement, or other obligation to which
XxXxxxxx is a party or by which XxXxxxxx may be bound. Except as
provided on the Disclosure Schedule, XxXxxxxx is not a party to, or
subject to or bound by, any judgment, injunction, or decree of any
court or governmental authority that restricts or prohibits the
performance by XxXxxxxx of the terms and conditions of this Agreement.
4. Representations of Simon. Simon represents and
warrants the following:
4.1 Corporate Approvals. Simon is a duly formed, validly
existing Utah corporation, with full power and authority to enter into
this Agreement by and through the officer executing his name hereto,
and any corporate approvals required will have been obtained at or
prior to the Closing.
4.2 Authorizations. At and as of the Closing, all corporate,
governmental, and other actions (other than those to be taken by the
Company) will have been duly taken to approve and authorize the
execution and delivery of this Agreement, the transfer of the
Transferred Assets at the Closing, the assignment of the Assigned
Equipment Leases and the Assigned Real Estate Leases, the sublease of
the Subleased Equipment, the performance and consummation by Simon of
the transactions contemplated herein, and the execution and delivery of
all documents required hereunder and incidental hereto. The execution,
delivery, and performance of this Agreement by Simon will not result in
violation of, or a default under, any agreement, charter document, or
other obligation to which it is a party or by which it may be bound.
This Agreement constitutes the valid and binding obligation of Simon
and is enforceable in accordance with its terms, subject to the effect
of bankruptcy, insolvency, reorganization, moratorium, or other similar
laws relating to creditors' rights generally and general equitable
principles, and subject to such approval of regulatory agencies and
other governmental authorities having authority over Simon as may be
required by statute or regulation.
4.3 Litigation. There is no material action, suit, proceeding,
demand, claim, assessment, judgment, litigation, lien, claim, or
governmental investigation against Simon or otherwise outstanding,
pending, or, to the knowledge of Simon, threatened which (i) questions
or might question the validity or legality of the transaction
contemplated hereby, (ii) seeks or might seek to enjoin any
transactions contemplated hereby, or (iii) seeks or might seek damages
on account of the consummation of any transaction contemplated hereby.
4.4 No Restriction. Simon is not a party to, or subject
to or bound by, any judgment, injunction, or decree of any court or
governmental authority that restricts or prohibits the performance
by Simon of the terms and conditions of this Agreement.
4.5 Ability to Perform Agreement. At the Closing, Simon
will possess the unrestricted ability to consummate the transactions
contemplated hereby.
5. Assumption of Leases and Liabilities; Sublease of
Equipment.
5.1 Assigned Equipment Leases. At the Closing, Simon shall
enter a new lease if possible or assume the leases for 249 Freightliner
tractors (the "Leased Equipment") with Mercedes-Benz Credit Corporation
pursuant to the Equipment Assignment and Assumption Agreement attached
as Exhibit E (the "Assigned Equipment Leases") or such other agreement,
as is acceptable to Simon, the Company, and Mercedes-Benz Credit
Corporation; provided, whether by a new lease, an assumed lease, or
other agreement, Simon at or prior to Closing shall receive
notification from Mercedes-Benz Credit Corporation that it will not
hold Simon responsible for defaults, penalties, amounts, or late fees
arising on or prior to Closing under the underlying leases.
5.2 Commerce City Leases. At the Closing, Simon shall assume
the Commerce City real estate leases (the "Commerce City Leases"),
subject to leases providing for continued subtenants on substantially
the same terms until December 2001, such that the net rental to be paid
by Simon (including the amount for leasehold improvements) is
approximately $15,000, pursuant to the Commerce City Real Estate
Assignment and Assumption Agreement attached as Exhibit G or such other
agreement as is acceptable to Simon, the Company, and the landlord.
5.3 Albuquerque Lease. At the Closing, Simon shall assume the
Albuquerque real estate lease (the "Albuquerque Lease") until June 30,
2001, pursuant to the Albuquerque Real Estate Assignment and Assumption
Agreement attached as Exhibit H or such other agreement as is
acceptable to Simon, the Company, and the landlord. The monthly rental
on the Albuquerque Lease currently is approximately $2,400 a month
(which may be altered based upon tax requirements).
5.4 Charlotte Lease. At the Closing, Simon shall assume the
Charlotte real estate lease (the "Charlotte Lease"), on substantially
the same month to month terms pursuant to the Charlotte Real Estate
Assignment and Assumption Agreement attached as Exhibit I or such other
agreement as is acceptable to Simon, the Company and the landlord until
Simon determines it no longer needs the facility. The Commerce City
Lease, Charlotte Lease, and the Albuquerque Lease shall hereafter be
referred to as the "Assigned Real Estate Leases."
5.5 Release of the Company From Lease Obligations. The
assignment of equipment and real estate under the Assigned Equipment
Leases and Assigned Real Estate Leases shall result in the complete and
full release of the Company, XxXxxxxx, and Shareholder from any and all
liability arising from Simon's performance or nonperformance of Simon's
obligations as assumed thereunder, and Simon shall indemnify, defend,
and hold the Company, XxXxxxxx, and Shareholder harmless from any
liability thereon arising at or after Closing as provided in Section
10.4 hereof.
5.6 Liabilities Not Assumed. Except as provided in Sections
5.1, 5.2, 5.3, 5.4, and 5.5, Simon is not assuming, and shall not be
deemed to have assumed, any liabilities or obligations of the Company,
Shareholder, or XxXxxxxx of any kind or nature whatsoever. Without
limiting the generality of the foregoing, it is hereby agreed that
Simon is not assuming, and shall not be deemed to have assumed, any
liability and shall not have any obligation for or with respect to any
liability or obligation of or relating to the Company, Shareholder, or
XxXxxxxx (i) for any prepayment penalty, late fee, interest, or other
amount arising before or as of the date of Closing on the Transferred
Assets; (ii) any payment, penalty, late fee, interest, or other amount
arising before or as of the date of Closing on the Assigned Equipment
Leases, Assigned Real Estate Leases, or Subleased Equipment; (iii) for
wages, bonuses, accrued vacation or sick leave, or other payments due
for any reason to the Company's employees for periods during which they
were employees of the Company; (iv) for any sales, use, excise, income,
franchise, or other taxes, or any legal, accounting, brokerage, finders
fees, or other expenses of whatsoever kind or nature incurred by the
Company, XxXxxxxx, or the Shareholder, except for sales or use tax or
taxes arising from the sale of assets as set forth in Section 1.6
hereof; (v) arising out of any action, suit, claim, or proceeding based
upon, any event occurring prior to the Closing; or (vi) claims for
withdrawal liability, unpaid contributions, unpaid wages and benefits,
or post-employment or post-retirement benefits. Other than the limited
assumption of the Assigned Equipment Leases and the Assigned Real
Estate Leases, and the sublease of the Subleased Equipment, the Company
and Shareholder shall indemnify, defend, and hold harmless Simon
against all such liabilities of the Company, XxXxxxxx, and Shareholder
as provided in Section 10.2. XxXxxxxx shall indemnify, defend, and hold
harmless Simon only as provided in Section 10.3. All employees of the
Company who may be employed by Simon on or after the Closing shall be
new employees of Simon and any prior employment by the Company of such
employees shall not affect entitlement to, or the amount of, salary or
other cash compensation, current or deferred, which Xxxxx xxx make
available to its employees, except as otherwise required by law, as
determined by Simon.
5.7 Deposits. At Closing, Simon shall pay to the Company the
amount representing all deposits made by the Company under leases which
are assigned and assumed by Simon, to the extent not previously offset
by the applicable lessor or landlord.
5.8 No Other Assets Sold. Except for the assets expressly
listed on Exhibit A and otherwise provided for in this Agreement, Simon
shall not be entitled to receive as part of its purchase any other
asset, right, or claim of the Company, all of such assets, rights, and
claims shall be retained by the Company, including without limitation,
the Company's accounts receivable.
5.9 Sublease of Trailers. At the Closing, Simon hereby subleases
from the Company all of the refrigerated trailers leased by the Company, as
such trailers are listed on attached Exhibit F (the "Subleased Equipment").
Simon's obligations under the sublease shall extend for the balance of the
underlying lease term, and upon the same terms, conditions, and rental as
the underlying lease, excluding late fees, penalties, and other amounts
(where the factual basis underlying such amount occurred pre-Closing),
provided the sublease, with respect to particular trailers under lease from
a lessor, only shall take effect in the event Simon is delivered a standard
lessor estoppel or consent letter prior to Closing (i) stating that no
defaults, penalties, amounts, or late fees exist, consenting to the
sublease, and agreeing not to hold Simon responsible under the underlying
lease, or (ii) consenting to the sublease, and agreeing not to hold Simon
responsible under the underlying lease. The Company, as sublessor, except as
provided below, shall be entitled to all rights and protections afforded
under the underlying leases to the Lessor thereunder. Any amounts identified
in the estoppel or consent letters shall reduce the Purchase Price or be
eligible for set-off under Section 10.9. Simon shall have no obligation to
satisfy any turn-in requirements specified in the underlying lease. The
condition requirements regarding the Subleased Equipment upon return of such
Subleased Equipment is as provided in Section 1.4. The Company shall tender
at Closing, and Simon shall return prior to expiration of the lease, the
trailers in the condition set forth in Section 1.4, as adjusted thereunder.
Simon, at its option, shall tender all lease payments directly to the
Lessors. Simon will promptly provide copies of all notices, if any,
regarding the Subleased Equipment to the Company. The Company shall be named
as an additional insured on all of Simon's insurance coverage regarding such
trailers.
6. Noncompetition Agreement.
------------------------
6.1 Noncompetition. The parties have negotiated the
noncompetition provisions of this Agreement as an integral part of the
transaction. The Company, XxXxxxxx, and Shareholder acknowledge that
Simon is willing to pay the Purchase Price and the Recruitment
Assistance Fee Payment and proceed with the transaction because of the
Company's customer relationships, and other prospects, and that such
prospects would be severely and irreparably harmed by competition from
the Company, Shareholder, or XxXxxxxx. The Company, Shareholder, and
XxXxxxxx further acknowledge that Simon would not have entered into
this Agreement without the noncompetition provisions contained herein.
The Company, Shareholder, and XxXxxxxx willingly agree to the
noncompetition provisions hereof and agree that the noncompetition
provisions are reasonable and are necessary to induce Simon to enter
into this Agreement.
6.2 Scope. In consideration of the Closing of this Agreement,
the Company, Shareholder, and XxXxxxxx hereby agree that they shall
not, for a period of five (5) years after the Closing, directly or
indirectly: (i) engage or invest in, own, manage, operate, finance,
control, or participate in the ownership, management, operation,
financing, or control of, be employed by, associated with, or in any
manner connected with, lend their name or any similar name to, lend
their credit to or render services or advice to, any Competitive
Business (as defined in this Section) that engages in business in the
United States, except investments in publicly traded companies that may
constitute a Competitive Business (whether directly or indirectly)
provided each such investment does not exceed 5% of the outstanding
stock of any such company; (ii) whether for their own account or for
the account of any other person, after the Closing solicit Competitive
Business from any person that is or was a customer of either the
Company or Simon; (iii) whether for their own account or the account of
any other person, after the Closing solicit, employ, or otherwise
engage as an employee, independent contractor, or otherwise, any person
who is or was an employee or independent contractor of the Company or
Simon or in any manner induce or attempt to induce any employee or
independent contractor of the Company or Simon to terminate his or her
employment or engagement with Simon, or at any time interfere with
Simon's relationship with any person, including any person who was an
employee, contractor, supplier, or customer of the Company or Simon; or
(iv) after Closing, disparage Simon or any of its stockholders,
directors, officers, employees, or agents. For the purposes of this
Section 6, Competitive Business shall include both dry van and
refrigerated (including temperature-controlled) operations, as well as
those brokerage, intermodal, logistics, and freight consolidation
activities involving refrigerated (including temperature-controlled)
and dry van truckload or less-than-truckload transportation.
Notwithstanding the provisions hereof, XxXxxxxx shall be permitted to
(y) own and operate SLT Express, Inc. in the limited respect of its
continued operation on substantially the same basis as existed at
Closing (provided such operation does not involve at any time more than
100 tractors, does not transport refrigerated or temperature-controlled
freight, or otherwise contravene Section (iii)) and (z) retain in the
Company's employ clerical personnel. Such limited operations and
activities shall not be deemed a violation of these noncompetition
provisions. Provided further, that XxXxxxxx shall be permitted to sell,
exchange or otherwise dispose of SLT Express Inc. (hereafter "Sale") to
any person or entity (other than a person or entity primarily engaged
in refrigerated, including temperature-controlled, activities) and any
stock, notes or other financial instrument received in such Sale shall
not be deemed a violation of these noncompetition provisions and such
person or entity acquiring SLT Express Inc. shall not be bound by the
provisions of this Section 6.
6.3 Nature. The obligations of the Company, Shareholder, and
XxXxxxxx under this Section 6 are referred to herein as the
"Noncompetition Obligations." The obligations of the Company,
Shareholder, and XxXxxxxx shall be joint and several as to any
violation of the Noncompetition Obligations by another.
6.4 Enforceability in Jurisdictions. The parties intend to and
hereby confer jurisdiction to enforce the Noncompetition Obligations
upon the courts of any jurisdiction within the United States. If the
courts of any one or more jurisdictions hold the Noncompetition
Obligations unenforceable by reason of the breadth of their scope or
otherwise, it is the intention of the parties that such determination
not bar or in any way affect Simon's right to the relief provided for
in this Section 6 in the courts of any other jurisdiction within the
United States, as to breaches of the Noncompetition Obligations in such
other respective jurisdictions, the Noncompetition Obligations as they
relate to each jurisdiction being, for this purpose, severable into
diverse and independent obligations.
6.5 Severability. Although subject to the terms of this
Agreement (and in particular Section 12.8 hereof), the covenants set
forth in this Section 6 shall be deemed and construed as a separate
agreement independent of any other provisions of this Agreement or any
other agreement between Simon, the Company and Shareholder. The
existence of any claim or cause of action by the Company, XxXxxxxx, or
Shareholder, or whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by Simon of the
covenants of this Section 6.
6.6 Damages. The Company, Shareholder, and XxXxxxxx each
individually acknowledge that the injury that would be suffered by
Simon as a result of a breach of the provisions of this Section 6 would
be irreparable and that even the award of monetary damages for such
breach would be an inadequate remedy. Consequently, Simon shall have
the right, in addition to any other rights it may have, to obtain
injunctive relief to restrain any breach or threatened breach or
otherwise to specifically enforce any provision of this Agreement, and
Simon shall not be obligated to post bond or other security in seeking
such relief. Simon shall provide any party it suspects of infringing
the provisions of this Section 6 with written notice specifying the
facts of such alleged infringement. The party to which notice is
delivered shall have ten (10) days to respond in writing to the
allegations before Simon seeks damages, injunctive relief, or set-off
under Section 10.9.
7. Conditions. The obligations of Simon hereunder are subject to
the following conditions (all or any of which may be waived in whole or in part
by Simon) having been fulfilled in all material respects on or before the
date of the Closing:
7.1 Representations and Warranties True; Compliance with
Covenants. The representations and warranties of the Company, XxXxxxxx,
and Shareholder shall be true and correct in all material respects at
and as of the date of the Closing with the same force and effect as
though such representations and warranties had been made at and as of
the date of the Closing and the Company, XxXxxxxx, and Shareholder
shall in all material respects have complied with and performed all
covenants, obligations, and conditions required by this Agreement to be
complied with or performed by each prior to the Closing, and Simon
shall have received from each of the President of the Company and
Shareholder and from XxXxxxxx a certificate to that effect in the form
of Exhibit J-1 and J-2 attached hereto, dated the date of the Closing.
7.2 No Damage or Destruction. The Transferred Assets,
Subleased Equipment, and Leased Equipment, as adjusted under Section
1.3, 1.4, and 1.5, shall not have suffered any destruction or damage by
fire, accident, or other casualty or Act of God, whether or not covered
by insurance, which affects such Transferred Assets, Subleased
Equipment, and Leased Equipment in a material and adverse way.
7.3 Due Diligence. Simon shall have reasonably and in good
faith completed its due diligence investigation of the Company's
assets, liabilities, operations, employees, customers, and business and
shall be satisfied with the results of such investigation in its sole
discretion.
7.4 Payoff Letters; Obligations on Transferred Assets. Prior
to Closing, the Company shall present to Simon payoff letters, with all
prepayment penalties, late fees, administrative fees, and other amounts
due included, in substantially the form attached as Exhibit K attached
hereto (the "Payoff Letters"). The Payoff Letters shall be executed by
the lenders and lessors providing financing on each of the Transferred
Assets.
7.5 Bulk Sales. Because the Company is not transferring most
of its assets, the parties do not believe bulk sales laws will be
applicable to the transaction. However, Simon agrees it will have
complied with the laws applicable to bulk sales if such laws remain in
effect in Colorado and New Mexico and are applicable to the
transaction.
7.6 Assignment of Leases. The lessors on the Subleased
Equipment, Assigned Equipment Leases, and the Assigned Real Estate
Leases shall have consented to the assignment or sublease to Simon on
the terms set forth in Section 5.1 and 5.9. The obligations of the
Company, Shareholder, and XxXxxxxx to close are also conditioned on the
receipt (which receipt may be waived in whole or in part) of the
lessors' consent to the assignment or sublease to Simon of the
Subleased Equipment, Assigned Equipment Leases, and the Assigned Real
Estate Leases where such consents (taken as a whole) impact the
transactions contemplated hereunder in a material respect.
7.7 Opinion of Xxxxx & Xxxxxx. Xxxxx shall receive at Closing
the unqualified opinion of Xxxxx & Xxxxxx, subject to standard
exceptions, as to the formation and corporate existence of the Company,
the taking of all necessary corporate actions, and the binding effect,
as to the Company, Shareholder, and XxXxxxxx.
8. The Closing.
-----------
8.1 Time. The transactions contemplated by this
Agreement shall be consummated at a Closing to be held at the offices
of Xxxxx & Xxxxxx in Denver, Colorado at 8:00 a.m. on the first
business day immediately following satisfaction of all conditions
contained herein, or such other time or place as the parties may
agree (the "Closing"). The parties will use their reasonable best
efforts to consummate the transactions contemplated hereunder on or
before January 8, 2001.
8.2 Deliveries. At the Closing, the Company, or
XxXxxxxx with respect to 8.2.3, shall deliver or caused to be
delivered to Simon the following:
8.2.1 Possession and the right of operation of all of
the Transferred Assets, Subleased Equipment, and Leased
Equipment, where such assets are located at that time, except
as provided in Section 9.1, all as adjusted under Section 1.3,
1.4, and 1.5.
8.2.2 Original titles to all tractors and trailers
included in the Transferred Assets, duly endorsed for transfer
and without any Lien noted thereon (or Payoff Letters covering
any Transferred Assets for which Simon shall remit a portion
of the Purchase Price to a lienholder under Section 1.1).
8.2.3 A duly executed Xxxx of Sale for the
Transferred Assets in substantially the form attached as
Exhibit L and a duly executed Lease.
8.2.4 The closing certificates set forth in
Exhibit J-1 and J-2.
8.2.5 The fully executed Assignment and
Assumption Agreements relating to the Assigned Equipment
Leases and the Assigned Real Estate Leases.
8.2.6 Lessor estoppel or consent letters as
provided in Section 5.9.
8.3 At the Closing, Simon shall deliver to the Company the
Cash Purchase Price and payment for the goodwill of the Company's
business as set forth in Section 1.2.1.
9. Conduct of Business Pre and Post-Closing.
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9.1 Completion of Loads. The Company shall be responsible for
billing, collection, and for other costs, expenses, liabilities, and
claims in connection with all shipments dispatched prior to the Closing
(and until such shipment has been delivered and the driver is available
for dispatch in the case of shipments being completed after the
Closing), and all revenue from such shipments shall be for the
Company's account. Any amounts relating to such pre-Closing shipments
collected by Simon shall be turned over to the Company immediately as
received. Simon shall be responsible for dispatching, and shall receive
all revenue from, all loads dispatched after the Closing.
9.2 No Change in Practices. The Company shall operate in the
ordinary course of business until the Closing. In addition, the Company
shall not change its procedures and practices with regard to billing of
freight unless specifically approved in advance by Simon.
9.3 Use of Name. The Company consents to the use of its name
for such time as is reasonably required by Simon to remove the
Company's name from the Transferred Assets, Subleased Equipment, and
Leased Equipment. Simon shall use its best efforts to remove the
Company's name, or any derivative thereof, from the tractors and
trailers included in the Transferred Assets, Subleased Equipment, and
Leased Equipment as soon as practicable, and will not otherwise hold
itself out as operating as Westway during such time. Subject to the
foregoing, Simon agrees to indemnify, defend, and hold harmless the
Company, XxXxxxxx, and Shareholder against all claims, causes, actions
and liabilities arising out of Simon's use of the Company's name as
provided in Section 10.4 hereof.
9.4 Disclosure. The Company, XxXxxxxx, and Shareholder consent
to the disclosure of material terms of this transaction as are required
by Federal or State securities laws. The parties consent to the
disclosure of the material terms of this transaction as required to
obtain third-party consents necessary to consummate the transactions
contemplated hereunder. Simon shall submit any press release to the
Company and XxXxxxxx for review and shall make such changes as may be
reasonably requested; provided, Simon shall not be required to make
changes contrary to the reasonable advice of its counsel.
9.5 Standstill. The Company, XxXxxxxx, and Shareholder agree
not to solicit or respond to competing bids or to conduct negotiations
with any other party following the execution of this Agreement.
9.6 Name Change. Within thirty (30) days after Closing, the
Company shall change its corporate name to a name that does not include
the words "Westway," "trucking," "transport," "transportation,"
"motor," "freight," "cargo," "express," or any similar word connoting
the trucking business.
9.7 Licenses; Operating Authority. The Company agrees to
cooperate with Simon to achieve an acceptable licensing arrangement for
the duration of the licenses and permits that were purchased for the
tractors and trailers included in the Transferred Assets, Subleased
Equipment, and Leased Equipment. If Simon cannot re-license the
tractors and trailers at a cost acceptable to Simon, then, at Simon's
request, Simon and the Company shall enter into a leasing or trust
arrangement structured by Simon in accordance with all requirements of
law and applicable regulations that is intended to preserve the use of
such licenses and permits. Simon shall indemnify, defend and hold the
Company, XxXxxxxx, and Shareholder harmless from any claims, causes,
actions, or liability arising out of such leasing or trust
arrangements, the use of the Company's operating authority, or Simon's
failure to re-license the tractors and trailers, as provided in Section
10.4 hereof.
9.8 Inventory Count and Miscellaneous Equipment Verification.
Prior to the Closing, Simon and the Company shall conduct an inspection
and physical count, if necessary, of the assets described on Exhibit A,
other than bulk fuel in storage and Qualcomm units, to see if such
assets are usable to Simon and agree on a price for such assets. Prior
to Closing, Simon and the Company shall conduct an inspection and
physical count (or view serial numbers) of the Qualcomm units described
on Exhibit A to verify such units have the SensorTrac feature and all
necessary wiring, harnesses, and other accessories. In the event the
Qualcomm units cannot be verified until after the Closing, any
discrepancies from the required condition will be eligible for set-off
under Section 10.9. Assets that are transferred hereunder shall be
considered Transferred Assets. At Closing, Simon and the Company shall
inspect bulk fuel in storage and agree on a price, based upon its cost
to the Company.
9.9 Driver Employment and Engagement. Simon covenants that the
compensation and benefits package offered to employee and independent
contractor drivers of the Company that meet Simon's qualification
standards shall be no less than the Company's compensation and benefits
package, considering the package as a whole. Simon shall use its
reasonable best efforts to hire all fleet or driver managers of the
Company.
9.10 Company Files. Xxxxx xxx request exclusive rights to, and
the Company shall provide, the Company's customer files, driver and
other employee files, maintenance records, warranties, telephone and
fax numbers, and website at no additional consideration.
10. Survival of Representations, Warranties, and Covenants;
Indemnification.
10.1 Survival of Representations, Warranties, and Covenants.
All representations, warranties, covenants, and agreements made by the
Company, XxXxxxxx, Shareholder, and Simon, respectively, in this
Agreement or pursuant hereto, shall survive, and provide a basis for
indemnification, following the Closing. Notwithstanding (a) any right
of the parties (whether or not exercised) to investigate the
representations, warranties, covenants, and agreements of any other
party contained in this Agreement, or (b) the knowledge of the party
seeking indemnification acquired or capable of being acquired,
including as a result of disclosures made on the Disclosure Schedule,
at any time, in each case whether before or after execution and
delivery of this Agreement, a party claiming indemnification shall have
the right to rely fully on the representations, warranties, covenants,
and agreements of the other parties contained in this Agreement to the
extent set forth in Section 10.
10.2 Indemnification by the Company and Shareholder. The
Company and Shareholder, jointly and severally, shall indemnify,
defend, and hold harmless Simon, its successors, assigns, officers,
directors, employees, agents, and Affiliates from and against any and
all claims, causes of action, suits, judgments, taxes, losses, damages,
deficiencies, obligations, fines, costs, and expenses (including,
without limitation, interest, penalties, and reasonable fees and costs
of attorneys and other experts) arising out of or otherwise in respect
of any claim, action, suit, proceeding or investigation, whether civil,
administrative, investigative, or otherwise with regard to: (i) any
misrepresentation, inaccuracy in, or breach of any representation,
warranty, covenant, or agreement of the Company or Shareholder
contained in this agreement or any contract executed in connection
herewith; (ii) any liability of the Company or Shareholder whatsoever,
including any third-party claims, arising from the act or omission of
the Company or Shareholder, either prior to or after the Closing; (iii)
any obligations relating to tractors included in the Assigned Equipment
Leases or trailers included in the Subleased Equipment that are
retained by the Company; (iv) without in any way limiting the scope of
Section 2.14, any liability of the Company or any predecessor or
Affiliate for (a) the handling or disposal of any substance, (b)
arranging for the disposal of any substance, (c) exposing any employee
or other individual to any substance or condition, or (d) owning or
operating any property or facility, in any manner that could form the
basis for any present or future action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand for damage to any
site, location, or body of water (surface or subsurface), for any
illness of or personal injury to any employee or other individual, or
for any other reason, under any Environmental Law; and (v) any cargo
damage, overcharge, or other claims made or threatened against Simon by
customers of the Company for shipments dispatched prior to Closing.
10.3 Indemnification by XxXxxxxx. XxXxxxxx shall indemnify,
defend, and hold harmless Simon, its successors, assigns, officers,
directors, employees, agents, and Affiliates from and against any and
all claims, causes of action, suits, judgments, taxes, losses, damages,
deficiencies, obligations, fines, costs, and expenses (including,
without limitation, interest, penalties, and reasonable fees and costs
of attorneys and other experts) arising out of or otherwise in respect
of any claim, action, suit, proceeding, or investigation, whether
civil, administrative, investigative, or otherwise with regard to: (i)
any misrepresentation, inaccuracy in, or breach of any representation,
warranty, covenant, or agreement of XxXxxxxx contained in this
Agreement; and (ii) without in any way limiting the scope of Section
3.3, any liability of the Company or any predecessor or Affiliate that
XxXxxxxx had knowledge of and which was not disclosed on the Disclosure
Schedule for (a) the handling or disposal of any substance, (b)
arranging for the disposal of any substance, (c) exposing any employee
or other individual to any substance or condition, or (d) owning or
operating any property or facility, in any manner that could form the
basis for any present or future action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand for damage to any
site, location, or body of water (surface or subsurface), for any
illness of or personal injury to any employee or other individual, or
for any other reason under any Environmental Law.
10.4 Indemnification by Simon. Simon shall indemnify, defend,
and hold harmless the Company, XxXxxxxx, and Shareholder, their heirs,
successors, assigns, officers, directors, employees, agents, and
Affiliates from and against any and all claims, causes of action,
suits, judgments, taxes, losses, damages, deficiencies, obligations,
fines, costs, and expenses (including, without limitation, interest,
penalties, and reasonable fees, and costs of attorneys and other
experts) arising out of or otherwise in respect of any claim, action,
suit, proceeding, or investigation, whether civil, administrative,
investigative, or otherwise with regard to: (i) any misrepresentation,
inaccuracy in, or breach of any representation, warranty, covenant, or
agreement of Simon contained in this Agreement or any contract executed
in connection herewith; (ii) any third-party claims relating to the
ownership or operation of the Transferred Assets, Subleased Equipment,
or Leased Equipment by Simon, the factual basis of which transaction or
claim (other than the lease agreements themselves) arose subsequent to
the Closing; (iii) any and all lease obligations arising or relating to
the Assigned Equipment Leases (other than as set forth in Section
10.2(iii)), Subleased Equipment (other than as set forth in Section
10.2(iii)), or the Assigned Real Estate Leases, the factual basis of
which transaction or claim arose subsequent to the Closing; (iv) any
sales or use taxes arising from the purchases under this Agreement; (v)
leasing or trust arrangements under Section 9.7; (vi) Simon's failure
to re-license the tractors and trailers included in the Transferred
Assets; and (vii) death, injury, or claim to or by any person or
property arising from or occurring in connection with the operation,
maintenance, ownership, or use of the Transferred Assets, Subleased
Equipment, or Leased Equipment by Simon, including where such death,
injury, or claim is based upon expressed or implied warranties, and
notwithstanding the provisions of Sections 1.3, 1.4, and 1.5, or
Simon's use of the Company's name or operating authority, or by Simon's
assigns.
10.5 Any Indemnified Party wishing to claim indemnification
upon learning of any action, claim, suit, proceeding, or investigation
described above shall promptly notice the Indemnifying Party or Parties
thereof; provided that the failure to so notify shall not affect the
obligations of the Indemnifying Party or Parties unless and to the
extent that the defense of such claim, proceeding, or lawsuit is
actually prejudiced as a result of such failure. If the Indemnified
Party, in its sole discretion, consents, upon such terms and conditions
as the Indemnified Party may impose, the Indemnifying Party may elect
to assume the defense of such claim, proceeding or lawsuit at the
expense of the Indemnifying Party.
10.6 In the event the Indemnifying Party assumes the defense
of any such claim, proceeding or lawsuit, (i) it will be conclusively
established for purposes of this Agreement that such claim, proceeding,
or lawsuit is within the scope of and subject to indemnification
hereunder; and (ii) no compromise or settlement which may or could in
any respect adversely affect the Indemnified Party may be effected
without the Indemnified Party's consent, and the Indemnified Party
shall have no liability for any compromise or settlement effected
without such consent.
10.7 Subject to Section 6.4, the parties hereby consent to the
non-exclusive jurisdiction of any Colorado or Utah court in which a
claim is brought against the Indemnifying Party for which
indemnification under this Section 10 may be available.
10.8 If an Indemnifying Party or any of its successors or
assigns shall consolidate with or merge into any other entity and shall
not be the continuing or surviving entity of such consolidation or
merger or shall transfer all or substantially all of its assets to any
entity, then and in each case, proper provisions shall be made so that
the successors and assigns of the Indemnifying Party shall assume the
obligations set forth in this Agreement.
10.9 Set-Off. In addition to all other remedies available to
Simon under this Agreement or by law, Simon, following written notice
and a ten (10) day opportunity to cure to Simon's satisfaction, shall
be entitled to withhold and set-off payments of the Recruitment
Assistance Fee Payment against amounts for which it is entitled to
indemnification, based upon its reasonable good faith estimate. If any
notice or opportunity to cure is outstanding, Simon shall be entitled
to withhold any remittance of the Recruitment Assistance Fee Payment
that comes due. If such amounts are later determined to be less than
the amount withheld and set-off, Simon shall promptly pay the Company
the difference between the amount originally withheld and set-off and
the actual amount.
11. Notices. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally or by recognized overnight
courier service on the party to whom notice is to be given, or on the second day
after mailing if mailed to the party to whom notice is to be given by first
class mail, registered or certified, return receipt requested, postage prepaid
and properly addressed as follows:
To Simon: Xxx Xxxxxxxx With copy to: Xxxxx Xxxxxxx-Xxxxxx
Xxxxx Transportation Services Inc. Xxxxxxx Law Firm, P.C., L.L.O.
5175 West 2100 South 000 X. 00xx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx Xxxx, XX 00000-0000 Xxxxxxx, XX 00000
Telephone: 000-000-0000 Telephone: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
To Company: Westway Express, Inc. With copy to: Xxxxxx "Hal" X. Xxxx
c/o Xxxxx X. XxXxxxxx 0000 Xxxxx Xxxxxx
0000 Xxxxx Xxxxxx Xxxxxx, XX 00000-0000
Xxxxxx, XX 00000-0000
To Shareholder: WesternWay Holdings Co. With copy to: Xxxxxx "Xxx" X. Xxxx
0000 Xxxxx Xxxxxx Xxxxxx, XX 00000-0000
Xxxxxx, XX 00000-0000
To Xxxxx X. XxXxxxxx With copy to: Xxxxxx "Hal" X. Xxxx
12. Miscellaneous Provisions.
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12.1 Entire Agreement. This Agreement, the attached Exhibits,
and the Closing deliveries identified herein contain the entire
agreement between the parties hereto with respect to the transactions
contemplated herein. All Exhibits referred to herein are intended to be
and hereby are specifically made a part of this Agreement.
12.2 Expenses. Except as otherwise herein expressly provided,
each party shall bear its own expenses (including without limitation
fees of their respective attorneys and consultants and experts)
incurred by such party in connection with this Agreement or the
consummation of the transactions contemplated herein.
12.3 Further Assurances. Following the Closing, upon
reasonable request by Simon, the Shareholder, XxXxxxxx, or the Company,
the party to which a request was made shall execute, or cause to be
executed, and shall deliver to the requesting party such other and
further documents of assignment, transfer, and conveyance as may be
necessary or advisable, in the reasonable opinion of Simon's counsel or
the Company's counsel, to effectively assign, transfer, and convey to
Simon all of the Transferred Assets being sold, leases being assumed,
subleases being entered into, or other benefits to be derived
hereunder.
12.4 Amendments. This Agreement shall not be changed or
terminated orally and no waiver of compliance with any provision or
condition hereof and no consent provided for herein shall be effective
unless evidenced by a written instrument duly executed by the party to
be charged therewith.
12.5 Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties, Simon Transportation Services
Inc., a Nevada corporation ("Parent") and their respective heirs,
successors, legal representatives, and permitted assigns. This
Agreement may not be assigned by any party without the prior written
consent of the other party; provided, either party may assign this
Agreement to an affiliated or related entity or party, so long as the
assigning party remains liable for performance of any duties of such
assigning party contained herein. If Simon or Parent shall consolidate
with or merge into any other entity and shall not be the continuing or
surviving entity of such consolidation or merger or shall transfer all
or substantially all of its assets to any entity, then and in each
case, this Agreement shall inure to the benefit of, and the obligations
hereunder shall be binding upon, such entity. Without further consent
of Simon, the Company may pledge or assign any rights to the
Recruitment Assistance Fee Payment, as such payment may be set-off
hereunder, subject to all of Simon's rights hereunder.
12.6 Attorneys' Fees. In any dispute regarding the enforcement
and/or breach of this Agreement, the prevailing party shall be entitled
to recover all costs and fees, including attorneys' fees, incurred by
such prevailing party in enforcing, and/or recovering damages for the
breach of, the terms of this Agreement.
12.7 Governing Law. Subject to Section 6.4, in which case the
enforcing court shall apply the laws of its home state, this Agreement
shall be construed and enforced in accordance with the laws of the
State of Utah.
12.8 Invalid Provisions. If any provision of this Agreement is
held to be illegal, invalid, or unenforceable, such provision shall be
fully severable and this Agreement shall be construed and enforced as
if such illegal, invalid, or unenforceable provision had never
comprised a part hereof; and the remaining provisions hereof shall
remain in full force and effect and shall not be affected by the
illegal, invalid, or unenforceable provision or by its severance
therefrom. Furthermore, in lieu of such illegal, invalid, or
unenforceable provision there shall be automatically added as a part of
this Agreement a provision as similar in terms to such illegal,
invalid, or unenforceable provision as may be possible and still be
legal, valid, or enforceable.
12.9 Headings. Paragraph headings herein are for
convenience only and shall not affect the interpretation of any
provision.
12.10 Counterparts. This Agreement may be executed in
one or more counterparts, all of which together shall constitute one
instrument.
* * * * * * * * * * * * * * * * *
Signature Page to the Asset Purchase Agreement
Among Xxxx Xxxxx Trucking, Inc.,
Westway Express, Inc.,
WesternWay Holdings Co., and
Xxxxx X. XxXxxxxx
IN WITNESS WHEREOF, the parties have executed this Agreement of the
day, month, and year first written above.
SELLER: BUYER:
WESTWAY EXPRESS, INC., XXXX XXXXX TRUCKING, INC.,
an Indiana corporation a Utah corporation
By: /s/ Xxxxx D, XxXxxxxx By: /s/ Xxx Xxxxxxxx
Xxxxx X. XxXxxxxx, Chairman Xxx Xxxxxxxx, President
SHAREHOLDER:
WESTERNWAY HOLDINGS CO.
By: /s/ Xxxxx X. XxXxxxxx
Xxxxx X. XxXxxxxx, Chairman
/s/ Xxxxx X. XxXxxxxx
XXXXX X. XxXXXXXX
Individually, as to Sections 1.7, 3, 5.5, 5.6, 6, 7.1, 7.6, 8.2.4, 9, 10, 11,
and 12
EXHIBIT INDEX
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Exhibit Description
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A Transferred Assets
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B IRS Form 8594
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C Albuquerque Lease
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D Disclosure Schedule
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E Equipment Assignment and Assumption Agreement
------------------------------------------------------------ ---------------------------------------------------------
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F Leased Equipment List
------------------------------------------------------------ ---------------------------------------------------------
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G Commerce City Real Estate Assignment and Assumption
------------------------------------------------------------ ---------------------------------------------------------
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H Albuquerque Real Estate Assignment and Assumption
------------------------------------------------------------ ---------------------------------------------------------
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I Charlotte Real Estate Assignment and Assumption
------------------------------------------------------------ ---------------------------------------------------------
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J-1 Closing Certificate of the Company
------------------------------------------------------------ ---------------------------------------------------------
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J-2 Closing Certificate of the Shareholder
------------------------------------------------------------ ---------------------------------------------------------
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K Form of Payoff Letter
------------------------------------------------------------ ---------------------------------------------------------
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L Form of Xxxx of Sale
------------------------------------------------------------ ---------------------------------------------------------
