ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (the "Agreement") is made and entered into
this 1st day of March, 2004, by and among Able Propane Co., LLC, a New Jersey
limited liability company, ("Seller"), Able Energy, Inc., a New Jersey
corporation, Xxxxxxxxxxx Xxxxxx (the "Owners"), and Xxxxxxx Xxxxxxxxxx (Manager)
and Liberty Propane, L.P., a Delaware limited partnership ("Parent"), and Action
Gas Propane Operations, LLC, a Delaware limited liability company, and its
successors and assigns ("Buyer").
RECITALS:
A. Seller is engaged in, among other things, the sale of liquid-propane
gas as well as the installation, repair and maintenance of related equipment in
the State of New Jersey (the "Propane Business").
B. The Owners own all of the issued and outstanding equity interest of
Seller.
C. Seller agrees to sell and Buyer agrees to purchase certain assets
operated by, used in or resulting from the Propane Business and to enter into
various ancillary agreements to accomplish the transactions set forth herein.
D. Seller and each of the Owners and Manager agree to enter into a
Noncompetition Agreement with Buyer.
AGREEMENT:
In consideration of the mutual agreements, covenants and premises set
forth herein, the parties agree as follows:
SECTION ONE
PURCHASE AND SALE OF ASSETS
1.1 Agreement to Sell and Purchase.
Seller (and the Owners, to the extent owning any Purchased Assets (defined
below) used in the Propane Business) agrees to sell, grant, convey, transfer,
assign and deliver to Buyer, and Buyer agrees to purchase and accept from Seller
and the Owners, on the Closing Date (as defined in Section 3.1), all of Seller's
and the Owners' right, title, and interest in, to and under the assets and
properties (free and clear of all liens and encumbrances) of every kind, nature
and description (wherever located), operated by, used in, resulting from or made
part of the Propane Business as the same shall exist on the Closing Date (the
"Purchased Assets"), except those assets and properties specifically excluded
pursuant to Section 1.2. The Purchased Assets shall include but not be limited
to:
(a) The propane gas related tangible and intangible property including
but not limited to customer storage tanks and cylinders (whether
installed or uninstalled); tank and cylinder and tank related parts,
pieces, fittings and equipment; 2 30,000 gallon bulk storage tanks;
trucks, trailers, cars, vehicles; appliance inventory; office
furniture and equipment; parts held for resale; fixtures; shop and
other equipment; computer system (including both software and
hardware); regulators, compressors, pumps, pigtails, meters, hoods,
stands, bases, tools, vaporizers, dispensing units; inventory not
otherwise listed; improvements on leased real property; trade
accounts receivable (subject to Section 2.2); Pre-receipted
Accounts, Pre-paid Accounts; and Customer Deposits (each as defined
in and subject to Section 2.3); all propane gas inventory; supplies;
customer information and lists, names or trade names including the
name "Able Propane" (subject to Sections 5.1 and 5.2), copyrights,
patents, licenses, permits and tanks in place of either Seller or
the Owners that are operated by, used in, resulting from or made
part of the Propane Business.
(b) To the extent not conveyed in Section 1.1(a), all assets listed on
Exhibit 1.1(b);
(c) All books and records and all files, documents, papers, agreements,
books of account and other records pertaining to the Purchased
Assets which are located at the offices of Seller or otherwise used
in connection with the Propane Business;
(d) All rights of Seller under all contracts, agreements, covenants,
leases (building, land, vehicles, loading facilities, storage tank
or otherwise) except the rights of Seller under those contracts
listed on Exhibit 4.1(f) for which the obligations of Seller were
not specifically assumed by Buyer on Exhibit 1.3.
1.2 Excluded Assets.
The Purchased Assets to be sold and purchased under Section 1.1 shall not
include the following (the "Excluded Assets"):
(a) The minute books and ownership records of Seller;
(b) Seller's investment securities, cash and cash equivalents (such as
demand deposit or money market accounts);
(c) Claims for refund of taxes and other governmental charges of
whatever nature for all periods prior to the Closing Date, state
sales tax deposits, prepaid expenses, non-trade receivables and
storage gas deposits;
(d) Rights which accrue or will accrue to Seller and the Owners under
this Agreement; and
(e) Claims or rights against third parties relating to liabilities or
obligations which are not specifically assumed by Buyer hereunder.
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1.3 Seller's Liabilities.
All of Seller's liabilities, debts and obligations of every character or
description, known or unknown, including accrued vacation pay and benefits
(defined as an employee's earned but unused vacation time or benefits but which
amount Seller shall pay through the Closing Date to all employees employed at
that time), accruing or arising from transactions or occurrences prior to the
Closing Date shall be Seller's sole obligation and responsibility except as
specifically set forth as follows regarding the proration of certain taxes
and/or except for the liabilities and contractual arrangements as specifically
assumed by Buyer under this Agreement and set forth in Exhibit 1.3 hereto. With
respect to the Purchased Assets, all personal property taxes, inventory taxes or
assessments of like kind, for the year of Closing (as defined in Section 3.1)
shall (i) be prorated based on the number of days owned by each party in the
calendar year and (ii) thereafter be paid by the parties in accordance with such
proration. Buyer shall not assume or be liable for any contract, liability or
obligation of, or claim against Seller or any Owner except to the extent
specifically assumed as set forth on Exhibit 1.3. Buyer shall not assume or be
liable for any sales or transfer taxes arising out of the transfer or sale of
the Purchased Assets.
SECTION TWO
PAYMENT OF PURCHASE PRICE/TERMS AND COLLATERAL AGREEMENTS
2.1 Asset Purchase Price; Noncompete Payment; Allocation.
(a) The aggregate base purchase price for the Purchased Assets (the
"Purchase Price") shall be Four Million Four Hundred Thousand
Dollars ($4,400,000) (consisting of (1) Three Million Dollars
($3,000,000) in cash (the "Closing Payment"), and (2) Five Hundred
Thousand Dollars ($500,000) in a Subordinated Promissory Note (the
"Subordinated Promissory Note") substantially in the form attached
hereto as Exhibit 2.1(a),
(i) plus the Accounts Receivable Payment (as defined and
calculated in accordance with Section 2.2);
(ii) plus or minus the Pre-receipted Accounts, Pre-paid Accounts,
Accruals and Customer Deposits (each as defined and calculated
in accordance with Section 2.3).
(b) In addition, as consideration for the agreements of Seller and each
of the Owners contained in their Noncompetition, Nonsolicitation and
Nondisclosure Agreements (the "Noncompetition Agreements"), Buyer
shall pay the aggregate sum of Nine hundred Thousand Dollars
($900,000) (the "Noncompete Payment") payable in accordance with
Section 2.4(iii);
(c) The Purchase Price shall be allocated among the Purchased Assets as
set forth in Exhibit 2.1(c).
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2.2 Determination of Accounts Receivable Payment.
Buyer will purchase the accounts receivable resulting from Seller's sales
of liquid propane gas owed to Seller at the close of business on the day
immediately prior to the Closing Date (the "Accounts Receivable") and will pay
(within thirty (30) days following the Closing Date) Seller for said accounts
receivable (the "Accounts Receivable Payment") according and pursuant to the
following recitation and assumptions:
(a) Accounts aged 0 - 30 days old: 100% of face value
(b) Accounts aged 31 - 60 days old: 95% of face value
(c) Accounts aged 61 - 90 days old: 85% of face value
(d) Accounts aged over 91 days old 0% of face value
For a period of 120 days, Buyer will collect and remit monthly to Seller, all
collections on accounts aged over 90 days as of the closing date. After 120
days, the remaining balance on all such accounts will revert to the Buyer.
2.3 Pre-receipted Accounts, Pre-paid Accounts, Accruals and Deposits.
Buyer and Seller shall determine what, if any, of Seller's accounts are to
be classified as "Pre-receipted Accounts" and/or "Pre-paid accounts" and/or
"Accruals" as of the close of business on the day immediately prior to the
Closing Date. It is agreed that the cash portion of the Purchase Price shall be
increased or reduced within thirty (30) days following the Closing Date by the
net amount and/or value of the Pre-receipted Accounts and/or Pre-paid Accounts
and/or Accrual as said amount and/or value, unused vacation pay, tax prorations,
unearned tank rent, asset discrepancies or liabilities assumed by Buyer, all as
determined as of the close of business on the day immediately prior to the
Closing Date.
Buyer and Seller shall further determine Seller's "Customer Deposits" held
as of the close of business on the day immediately prior to the Closing Date. It
is agreed that the cash portion of the Purchase Price shall be reduced at
Closing by the net amount and/or value of the Customer Deposits as said amount
and/or value is determined as of the close of business on the day immediately
prior to the Closing Date.
2.4 Payment of Asset Purchase Price.
(a) Buyer shall pay the Purchase Price and the Noncompete Payment to
Seller and the Owners as follows:
(i) Three Million Dollars ($3,000,000) (the "Closing Payment")
shall be paid by Buyer by a wire transfer at the time of
Closing.
(ii) The Accounts Receivable Payment net of the Section 2.3
adjustments shall be paid by Buyer by wire transfer within
thirty (30) days following the Closing Date.
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(iii) The Noncompete Payment shall be paid in installments in
accordance with Exhibit 2.4(iii) hereof.
(iv) Buyer shall deliver the Subordinated Promissory Note to
Seller.
2.5 Storage of Tanks
Buyer shall have the right to store the 2 30,000 gallon tanks
and other new, unused, uninstalled customer storage tanks at the Able Energy,
Inc bulk plant located at 000 Xxxxx 00, Xxxxxxxx, XX, 00000, at no charge, until
such time as Buyer has established its own bulk storage facility.
SECTION THREE
CLOSING
3.1 Closing Date.
The closing of the transactions contemplated by this Agreement shall be
held at the office of Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP, 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, XX, 00000 at 9:00 A.M on March 1, 2004.. The closing shall
be deemed effective as of the close of business on February 29, 2004, with the
actual closing to take place on March 1, 2004. The date and event of such sale
and purchase are, respectively, hereinafter referred to as the "Closing Date"
and the "Closing."
3.2 Seller's Duties at Closing.
(a) At the Closing, Seller shall deliver or cause to be delivered to
Buyer:
(i) The duly executed General Xxxx of Sale substantially in the
form attached hereto as Exhibit 3.2(a)(i) and such other bills
of sale, endorsements, checks, assignments, certificates of
title and other instruments of transfer and conveyance as
shall be effective to vest title to each of the Purchased
Assets in Buyer.
(ii) Documents evidencing that Seller has taken all requisite
corporate action to change its name to "_______________,"
effective immediately following the Closing Date, and is
prepared to file an amendment to Seller's
____________________reflecting such name change immediately
following the Closing Date.
(iii) Copies of the resolutions of the Board of Directors of Seller
adopting and approving this Agreement and authorizing the
transactions contemplated hereby.
(iv) The duly executed Noncompetition Agreements of Seller and each
of the Owners substantially in the form attached hereto as
Exhibit 3.2(a)(iv).
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(v) A good standing certificate for Seller from New Jersey dated
no more than ten (10) days prior to the Closing Date attached
hereto as Exhibit 3.2(a)(v).
(vi) The duly executed Landlord Agreements substantially in the
form attached as Exhibit 3.2(a)(vi).
(vii) The duly executed SubLease Agreements substantially in the
form attached hereto as Exhibit 3.2(a)(vii) (the "SubLease
Agreements");
(viii) A list of Seller's trade creditors attached as Exhibit
3.2(a)(viii).
(ix) An acknowledgment to the assignment of this Agreement to
Buyer's and Parent's lender in the form attached hereto as
Exhibit 3.2(a)(ix).
(x) With respect to Seller's indebtedness for borrowed money in
existence immediately prior to the Closing, a payoff letter
executed by the creditors with respect thereto in the form
attached as Exhibit 3.2(x).
(xi) A duly executed license from the state of New Jersey granting
the Buyer the authority to operate a propane company in the
state of New Jersey.
(xii) An assignment of the through put agreement between Seller and
Alcoa/Howmet.
(b) At the Closing, Buyer shall deliver or cause to be delivered to
Seller:
(i) The Closing Payment to be transferred by wire to Seller's and the
Owners' accounts in accordance with Exhibit 3.2(b)(i).
(ii) The duly executed Noncompetition Agreements of Seller and each of
the Owners.
(iii) The duly executed Lease Agreements.
(iv) The duly executed Assumption Agreement substantially in the form
attached hereto as Exhibit 3.2(b)(v).
SECTION FOUR
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Seller and the Owners.
Seller and the Owners, jointly and severally, represent and warrant to
Buyer, now and as of the closing, as follows:
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(a) Status and Authorization. Seller operates as a limited liability
company known as Able Propane Co., LLC, was formed under the laws of
the State of New Jersey and is wholly owned by the Owners. Except as
disclosed in Exhibit 4.1(a), Seller is in good standing under the
laws of the State of New Jersey and has the power to own its
property and to carry on its business as now being conducted. Seller
is duly qualified to do business and is in good standing in each
jurisdiction set forth in Exhibit 4.1(a) in which such qualification
is necessary. Seller and the Owners have full power, authority and
legal capacity to execute and deliver this Agreement and to perform
the obligations of Seller and the Owners under the terms hereof. The
execution and delivery of this Agreement and the performance of all
the obligations of Seller under the terms hereof have been duly
authorized by all actions necessary to authorize execution, delivery
and performance of this Agreement and the transactions contemplated
hereby. Seller has no subsidiaries, affiliates or investments in any
other entity or business operation, and Seller has no subsidiary or
affiliate whose liabilities or obligations will be assumed by Buyer.
(b) Restrictions. Neither Seller nor any Owner is subject to any
restriction under any law or contained in any organizational
document, bylaw, mortgage, lien, lease, agreement, instrument,
order, judgment or decree, which would prevent the consummation of
the transactions contemplated by this Agreement or which would be
violated by such consummation.
(c) Financial Statements.
(i) Seller has delivered to Buyer: (i) balance sheets of Seller as
at June 30, for each of the three preceding fiscal years and
the related statements of income for each of the fiscal years
then ended, and (ii) a balance sheet of Seller (the "Interim
Balance Sheet") as at September 30, 2003 (the "Financial
Statement Date"), and the related unaudited statement of
income for the three months then ended (together, the
"Financial Statements"). Copies of the Financial Statements
are set forth on Exhibit 4.1(c). The Financial Statements and
the notes thereto are true, correct, accurate and complete and
fairly present the financial condition and the results of
operation of Seller as at the respective dates of and for the
periods referred to in the Financial Statements, all in
accordance with GAAP, subject, in the case of interim
Financial Statements, to normal recurring year-end adjustments
(the effect of which will not, individually or in the
aggregate, be adverse) and the absence of notes (that, if
presented, would not differ from those included in the Interim
Balance Sheet). The Financial Statements referred to in this
section reflect the consistent application of such accounting
principles throughout the periods involved.
(ii) Except for (a) liabilities fully reflected or reserved against
in the Interim Balance Sheet; and (b) regular and usual
liabilities and obligations incurred in the ordinary course of
business consistent with past practices after the Financial
Statement Date, Seller has no liabilities, obligations or
claims (absolute, accrued, fixed or contingent, matured or
unmatured, or otherwise), including liabilities, obligations
or claims which may become known or which arise only after the
Closing Date and which result from actions, omissions or
occurrences of Seller prior to the Closing Date.
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(iii) Since the date of the Interim Balance Sheet, there has not
been any adverse change in the business, operation,
properties, prospects, assets, or condition of Seller, and no
event has occurred and no circumstance exists that may result
in such an adverse change.
(d) Purchased Assets. Seller and/or the Owners have good title to the
personal (tangible and intangible) property to be sold hereunder. As
of the Closing Date, none of the Purchased Assets to be transferred
to Buyer pursuant to this Agreement will be subject to any contract
of sale, or to encumbrances, claims, security agreements, liens or
charges of any kind or character (other than those encumbrances
described on Exhibit 4.1(d)). No person, corporation or firm has any
ownership interest or claim in the Purchased Assets being
transferred pursuant to this Agreement other than Seller and the
Owners.
(e) Condition and Sufficiency of the Purchased Assets. The Purchased
Assets are structurally sound, are in good operating condition and
repair, and are adequate for the uses to which they are being put,
and none of such Purchased Assets are in need of maintenance or
repairs except for ordinary, routine maintenance and repairs. The
Purchased Assets are sufficient for the continued conduct of the
Propane Business after the Closing Date in substantially the same
manner as conducted prior to the Closing Date.
(f) Contracts. Except as set forth in Exhibit 4.1(f), Seller is not,
with respect to or affecting the Purchased Assets, a party to a
contract of any nature or any of the following contracts, whether
the same be written or oral:
(i) Contracts not made in the ordinary course of business;
(ii) Employment contracts, executive employment agreements,
executive compensation agreements, employee pension or
retirement plans or similar arrangements or agreements;
(iii) Contracts with any labor union or similar arrangements or
agreements;
(iv) Bonus, insurance or similar plans providing employee benefits
or similar arrangements or agreements;
(v) Leases with respect to any property, whether as lessor or
lessee, or license agreements;
(vi) Continuing contracts for the future purchase of materials,
supplies or equipment outside the ordinary course of business;
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(vii) Chattel, mortgages, equipment leases, security agreements or
conditional sales agreements; or
(viii) Partnership, joint venture or other business enterprise
agreements and franchise agreements.
Seller has performed all obligations presently required to be
performed by it and is not in default under any contract to which it
is a party. Seller has the ability and authority to transfer, assign
or convey to Buyer all of the contracts and leases used in the
Propane Business which Buyer needs to continue the business as
contemplated under this Agreement and to which Buyer has agreed to
assume pursuant to the specific terms set forth herein.
(g) Accounts Receivable. All accounts receivable of Seller that are
reflected on the Interim Balance Sheet or on the accounting records
of Seller as of the Closing Date represent valid obligations arising
from sales actually made or services actually performed in the
ordinary course of business. There is no contest, claim, or right of
set-off, other than returns in the ordinary course of business,
under any contract with any obligor of an account receivable
relating to the amount or validity of such account receivable.
(h) Taxes. The term "Taxes" means all net income, capital gains, gross
income, gross receipts, sales, use, transfer, ad valorem, franchise,
profits, license, capital, withholding, payroll, employment, excise,
goods and services, severance, stamp, occupation, premium, property,
assessments, or other governmental charges of any kind whatsoever,
together with any interest, fines and any penalties.
(i) Seller has duly and timely filed (and prior to the Closing
Date will duly and timely file) true, correct and complete tax
returns, reports or estimates, all prepared in accordance with
applicable laws, for all years and periods (and portions
thereof) and for all jurisdictions (whether federal, state,
local or foreign) in which any such returns, reports or
estimates were due. All Taxes shown as due and payable on such
returns, reports and estimates have been paid, and there is no
current liability for any Taxes due and payable in connection
with any such returns. There are no existing liens for Taxes
upon any of the Purchased Assets.
(ii) Seller has (i) withheld all required amounts from its
employees, agents, contractors and nonresidents and remitted
such amounts to the proper agencies; (ii) paid all employer
contributions and premiums and (iii) filed all federal, state,
local and foreign returns and reports with respect to employee
income tax withholding, and social security and unemployment
taxes and premiums, all in compliance with the withholding tax
provisions of the Internal Revenue Code of 1986, as amended
(the "Code"), or any prior provision of the Code and other
applicable laws.
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(i) Litigation and Laws. Except as disclosed in Exhibit 4.1(i), neither
Seller nor the Owners are now involved in any litigation or dispute
affecting the Purchased Assets nor are either Seller or the Owners
aware of any pending litigation or dispute which may arise and
Seller is not engaged in nor to the knowledge of Seller or any of
the Owners, threatened with any legal action or other proceeding
before any court or administrative agency, and has not been charged
with, and is not, to the knowledge of Seller or any of the Owners,
under investigation with respect to any charge concerning any
violation of any provision of federal, state or local law or
administrative regulation, including but not limited to, any matter
before the Environmental Protection Agency or any like governmental
agency whether at the federal, state, county or local level with
respect to its business. Further, Seller has previously complied and
is in compliance with all federal, state, county and local laws and
administrative regulations with respect to its Propane Business.
(j) Environmental Matters. Except as set forth in Exhibit 4.1(j):
(i) Seller is, and at all times has been, in compliance with, and
has not been and is not in violation of or liable under, any
environmental health or safety law. Neither Seller nor the
Owners has any basis to expect, nor has any of them received,
any actual or threatened order, notice, or other communication
from any governmental body or private citizen acting in the
public interest of any actual or potential violation or
failure to comply with any environmental health or safety law,
or of any actual or threatened obligation to undertake or bear
the cost of any environmental, health and safety liabilities
with respect to any of its facilities or any other properties
or assets (whether real, personal, or mixed) in which Seller
held an interest, or with respect to any property or facility
at or to which hazardous materials were generated,
manufactured, refined, transferred, imported, used, or
processed by Seller or from which hazardous materials have
been transported, treated, stored, handled, transferred,
disposed, recycled, or received by Seller.
(ii) Neither Seller nor any Owner has any environmental, health,
and safety liabilities with respect to the facilities or with
respect to any other properties and assets (whether real,
personal, or mixed) in which Seller or any of the Owners has
or had an interest.
(iii) Except for propane gas, there are no hazardous materials
present on or in the environment at the facilities used by
Seller in connection with the Propane Business, including any
hazardous materials contained in barrels, above or underground
storage tanks, landfills, land deposits, dumps, equipment
(whether moveable or fixed) or other containers, either
temporary or permanent, and deposited or located in land,
water, dumps, or any other part of the facilities or
incorporated into any structure therein or thereon. Neither
Seller nor any Owner has permitted or conducted, or is aware
of, any hazardous activity conducted with respect to the
facilities or any other properties or assets (whether real,
personal, or mixed) in which Seller has or had an interest
except in compliance with all applicable environmental laws.
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(iv) There has been no release or threat of release, of any
hazardous materials at or from the facilities or at any other
locations where any hazardous materials were generated,
manufactured, refined, transferred, produced, imported, used,
or processed from or by the facilities, or from or by any
other properties and assets (whether real, personal, or mixed)
in which Seller has or had an interest, whether by Seller or
any Owner.
(k) Labor Relations.
(i) Seller has made no representations to its employees with
respect to any undertaking or commitment by Buyer to employ
such employees. Seller has no liability under the National
Labor Relations Act, the Fair Labor Standards Act, the Civil
Rights Act, the Equal Employment Opportunity Act or any other
social, employment or labor law affecting Seller which would
adversely affect the Propane Business. No employee, officer,
or director of Seller is a party to, or is otherwise bound by,
any agreement or arrangement, including any confidentiality,
noncompetition, or proprietary rights agreement, between such
employee or director and any other person that in any way
adversely affects or will affect the operation of the Propane
Business after the Closing Date.
(ii) In the three (3) year period immediately preceding the Closing
Date, Seller has not been or is not a party to any collective
bargaining or other labor contract. In the same three year
period there has not been, there is not presently pending or
existing, and there is not threatened, (i) any strike,
slowdown, picketing, work stoppage, or employee grievance
process, (ii) any proceeding against or affecting Seller
relating to the alleged violation of any legal requirement
pertaining to labor relations or employment matters, including
any charge or complaint filed by an employee or union with the
National Labor Relations Board, the Equal Employment
Opportunity Commission, or any comparable governmental body,
organizational activity or other labor or employment dispute
against or affecting Seller or its premises, or (iii) any
application for certification of a collective bargaining
agent. No event has occurred or circumstance exists that could
provide the basis for any work stoppage or other labor
dispute. There is no lockout of any employees by Seller, and
no such action is contemplated by Seller. Seller is not liable
for the payment of any compensation, damages, taxes, fines,
penalties, or other amounts, however designated, for failure
to comply with any of the foregoing legal requirements.
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(l) No Omissions or Misrepresentations. No representation, warranty or
statement of either Seller or any Owner contained in this Agreement
or in the Exhibits attached hereto is false, or in light of the
circumstances in which it was made, misleading in any respect and
there has been no omission or failure to disclose facts known by any
Owner, or any officer or director of Seller which would adversely
affect the transactions set forth in this Agreement.
4.2 Representations and Warranties of Buyer.
Buyer represents and warrants to Seller as follows:
(a) Status and Authorization. Buyer is a limited liability company duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has the power to own its property and to
carry on its business as it is now being conducted by Seller. Buyer
has full power, authority and legal capacity to execute and deliver
this Agreement and to perform Buyer's obligations under the terms
hereof. The execution and delivery of this Agreement and the
performance of all the obligations of Buyer under the terms hereof
have been duly authorized by all actions necessary to authorize
execution, delivery and performance of this Agreement and the
transactions contemplated hereby.
(b) Restrictions. Buyer is not subject to any restriction contained in
any organizational document, bylaw, mortgage, lien, lease,
agreement, instrument, order, judgment or decree which would prevent
the consummation of the transactions contemplated by this Agreement.
SECTION FIVE
POST-CLOSING COVENANTS
5.1 Use of Seller's Name.
Immediately after the Closing Date, Seller and the Owners will take all
necessary actions to enable Buyer to use "Able Propane," including, but not
limited to, a formal name change of Seller under applicable state law(s) and a
transfer of all registered and trade names to Buyer.
5.2 Further Assurances.
The parties agree, without further consideration, to execute and deliver
such further instruments of transfer or assignment or other documents and to
take such other action as the other parties reasonably may request for the
purpose of carrying out the terms of this Agreement and the other documents
referred to herein.
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SECTION SIX
GENERAL PROVISIONS
6.1 Survival of Representations and Warranties; Indemnity Agreement.
(a) The representations, warranties, covenants and agreements given by
Seller, the Owners and Buyer which are contained in this Agreement
shall survive the Closing Date for a period of three (3) years from
the Closing Date except for Seller's representation regarding (1)
Taxes which shall expire and terminate upon the expiration of the
applicable statute of limitations specified in the Code or in the
laws of any state or other taxing authority as such statute of
limitations period may be validly extended pursuant to applicable
tax laws and (2) Seller's and the Owners' representations regarding
environmental matters under Section 4.1(j) which shall expire upon
the expiration of the applicable statutes of limitations as
specified in the applicable laws. Seller and the Owners will
indemnify Buyer, and Buyer will indemnify Seller and the Owners
against any loss, cost, liability or expense (including, without
limitation, costs and expenses of litigation and reasonable
attorneys' fees) incurred or suffered by either party as a result of
the inaccuracy, misrepresentation or breach of any of the
representations, warranties, covenants and agreements of Seller, the
Owners or Buyer, as the case may be, contained in this Agreement.
Seller and the Owners will further indemnify Buyer for the assertion
against Buyer of any liability of Seller which is not expressly
assumed by Buyer pursuant to this Agreement, including but not
limited to that lawsuit filed 4/15/03, Reference: B10289423, Suit:
SL-00001042-2003, Case: L 001042 03, in Superior Court Law Div. Of
New Jersey by Fremont Indemnity Co. against Able Propane Co., Able
Oil Melbourne, Inc, Able Oil Company Inc D/B/A Northwest Petroleum
000 Xxxxx Xxxx Xxxx, Xxxxxxxx, XX, 00000. Buyer will further
indemnify Seller for the assertion against Seller of any liability
expressly assumed by Buyer pursuant to this Agreement as well as for
any loss suffered by Seller or the Owners as a result of Buyer's use
of the Purchased Assets or operation of the Propane Business
following the Closing Date.
(b) The obligations and liabilities of any party to indemnify any other
party under this Section 6.1 hereof with respect to claims relating
to third parties ("Claims") shall be subject to the following terms
and conditions:
(i) The party to be indemnified (the "Indemnified Party") will
give the other party (the "Indemnifying Party") prompt notice
of any such Claim, and the Indemnifying Party will undertake
the defense, compromise or settlement thereof by
representatives chosen by it. The failure to promptly notify
the Indemnifying Party shall not relieve such party of its
obligations hereunder provided that the failure so to notify
does not adversely prejudice the Indemnifying Party's ability
to defend such Claim.
(ii) If the Indemnifying Party, within a reasonable time after
notice of any such Claim, fails to defend a Claim, the
Indemnified Party will (upon further notice to the
Indemnifying Party) have the right to undertake the defense,
compromise or settlement of such Claim on behalf of, and for
the account and risk of the Indemnifying Party, subject to the
right of the Indemnifying Party to assume the defense of such
Claim at any time prior to settlement, compromise or final
determination thereof.
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(iii) Anything in this Section 6.1(b) to the contrary
notwithstanding (a) if there is a reasonable probability that
a Claim may adversely affect the Indemnified Party other than
as a result of money damages or other money payments, the
Indemnified Party shall have the right, as its own cost and
expense, to defend, compromise or settle such Claim, and (b)
the Indemnifying Party shall not, without the written consent
of the Indemnified Party, settle or compromise any Claim or
consent to the entry of any judgment which does not include as
an unconditional term thereof the giving by the claimant or
the plaintiff to the Indemnified Party a release from all
liability in respect of such Claim.
6.2 Notices.
Any notice, request, instrument or other document to be given hereunder
shall be effective only if it is in writing and (i) personally delivered, (ii)
sent by certified or registered mail, return receipt requested, postage prepaid
or (iii) sent by a nationally recognized overnight delivery service, with
delivery confirmed to:
(a) Buyer:
Xxxx X. Xxxxxxx
Liberty Propane L.P.
00000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxx 00000
Phone: 000.000.0000
Fax: 000.000.0000
With a copy to:
Xxxxxxxx X. Xxxxxx
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Phone: 000.000.0000
Fax: 000.000.0000
(b) Seller:
Xxxxxxx Xxxxxxxxxx
Able Energy
000 Xxxxx Xxxx Xxxx
Xxxxxxxx, Xxx Xxxxxx, 000000
Phone: 000.000.0000
Fax: 000.000.0000
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With a copy to:
Xxxxxx Xxxxxx
Sichenzia Xxxx Xxxxxxxx Xxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx, Xxxx, Xxx Xxxx, 00000
Phone: 000-000-0000
Fax: 000-000-0000
or to such other address as the parties hereto may designate by notice given as
above provided. A notice shall be deemed to have been given as of the date when
(i) personally delivered, (ii) five (5) days after the date when deposited with
the United States mail properly addressed or (iii) when receipt of a Notice sent
by an overnight delivery service is confirmed by such overnight delivery
service, as the case may be, unless the sending party has actual knowledge that
a notice was not received by the intended recipient.
6.3 Confidentiality.
All of the parties to this Agreement shall maintain the confidentiality of
all information received pursuant to this Agreement, which is not otherwise
publicly available. Such information shall be held in confidence and shall not,
at any time, be used for any purpose by the party receiving such information,
unless such information becomes publicly available through a source other than
the parties hereto to whom such information was disclosed.
6.4 Amendment.
This Agreement may be amended only by a written instrument signed by each
of the parties hereto.
6.5 Waiver.
Any waiver shall be valid if set forth in writing signed by the waiving
party or by one authorized on behalf of such party. Waiver of any provision of
this Agreement or of any breach hereof shall be a waiver of only said specific
provision or breach and shall not be deemed a waiver of any other provision or
any further breach hereof.
6.6 Governing Law.
This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of New Jersey.
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6.7 Entire Agreement.
This Agreement and all agreements specifically referred to herein
constitute the entire agreement and understanding of the parties with respect to
the transactions contemplated hereby and supersede any and all prior agreements
and understandings relating to the subject matter hereof.
6.8 Headings.
The section and article headings contained in this Agreement are inserted
for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement.
6.9 Binding Effect.
This Agreement shall be binding upon and inure to the benefit of the
parties, their successors and assigns.
6.10 Assignment.
Buyer has the right to assign its rights under this Agreement to its
parent or an entity formed by Buyer to carry on the Propane Business. Buyer and
its assigns have the further right to assign their rights under this Agreement
to any entity acquiring the stock, assets or operations of Buyer or taking any
interest therein as collateral security. Each of Buyer, Parent and their
respective permitted assigns shall have the right, without the prior consent of
Seller, at any time, in its sole discretion, to assign, in whole or in part, its
rights under this Agreement and all other documents, instruments and agreements
executed in connection with this Agreement for collateral security purposes to
any lender providing financing to Buyer, Parent and/or such permitted assigns.
6.11 Counterparts.
This Agreement may be executed in any number of separate counterparts,
each of which shall be deemed to be an original, but which together shall
constitute one and the same instrument.
6.12 Construction.
This Agreement shall not be construed against any party for having drafted
it or for having the Agreement drafted by such party's counsel.
6.13 Fees and Expenses.
Each party hereto shall be responsible for its own costs, fees and
expenses including any brokerage/finder's fees incurred through the Closing
Date.
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6.14 Arbitration.
In the event of any dispute, interpretation, conflict or claim, in tort,
contract or otherwise, based upon or related to this Agreement, the parties
hereby irrevocably agree that such dispute, interpretation, conflict or claim
shall be resolved by binding arbitration under the rules for Commercial
Transactions before the American Arbitration Association in Rockaway, New
Jersey. Any party bringing suit or action, other than through binding
arbitration, shall hereby have such suit or claim immediately dismissed with
prejudice by the court having jurisdiction thereon.
[SIGNATURES ARE ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed on the day and year first above written.
SELLER: ABLE PROPANE CO., LLC
a New Jersey Limited Liability Company
By:
Name: _______________________________
Title: _____________________________
OWNERS:
By:
Name: Able Energy, Inc_______________
By: ____________________________________
Name: Xxxxxxxxxxx Xxxxxx
MANAGER: By: ___________________________________
Name: Xxxxxxx Xxxxxxxxxx
BUYER:
ACTION GAS PROPANE OPERATIONS, LLC
By: Liberty Propane, L.P.,
its sole member
By: Liberty Propane GP, LLC,
General Partner of
Liberty Propane, L.P.
By: _______________________________
Name: _____________________________
Title: ____________________________
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PARENT:
LIBERTY PROPANE L.P.,
a Delaware Limited Partnership
By Liberty Propane GP, LLC, its
General Partner
By:
Name: ______________________________
Title: ____________________________
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