ASSET PURCHASE AGREEMENT
BETWEEN
U.S. PAWN, INC.
AND
CITY NATIONAL PAWN, INC.
d/b/a
CITY NATIONAL PAWN
TABLE OF CONTENTS
1. Assets To Be Transferred. 1
2. Assets Not To Be Transferred. 3
3. Calculation of Purchase Price. 3
4. Purchase Price and Allocation of Purchase Price. 3
5. Payment of Purchase Price. 4
6. Right of Inspection Prior To The Closing Date. 4
7. Closing. 4
8. Contingencies. 4
9. Covenant of Further Assistance. 5
10. Additional Closing Procedures. 5
11. Liabilities To Be Assumed. 5
12. Possession of Property. 5
13. Seller's Warranties. 6
14. Risk of Loss. 9
15. Purchaser's Warranties. 9
16. Conduct of Business. 10
17. Trade Secrets. 10
18. Covenant Not To Compete. 11
19. Indemnification. 11
20. Seller's Right To Access To Certain Records. 11
21. Construction of Agreement. 11
22. Entire Agreement. 12
23. Broker Commissions. 12
24. Costs. 13
25. Headings. 13
26. Notices. 13
27. Default. 13
28. Succession and Assignment. 13
29. Execution. 13
30. Gender. 13
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (hereinafter "Contract" or "Agreement") is
made and entered into this 2nd day of August 1996, (the "Transfer Date") by and
between U.S. PAWN ("Purchaser"), and CITY NATIONAL PAWN, INC., d/b/a CITY
NATIONAL PAWN (hereinafter called "Seller"), upon the following premises, terms,
conditions, considerations and agreements:
PREMISE
It is recognized that Seller is the owner and operator of a pawnshop store,
located at 000 Xxxxx Xxxxxxx Xxx., Xxxx Xxxxxxx, XX, 00000 which shall
hereinafter be referred to as "the pawnshop business". It is further recognized
that it is those assets constituting the pawnshop business which are being sold
and are those identified in Paragraph 1 and respective exhibits attached hereto.
It is intended hereby that whatever right, title and/or interest is owned by
each of the parties included in the term "Seller" shall be conveyed to Purchaser
hereby.
1. Assets To Be Transferred. For and in consideration of the purchase
price set forth below, and of the mutual covenants and agreements
herein contained, Seller agrees to SELL, TRANSFER, CONVEY AND DELIVER
to Purchaser, and Purchaser agrees to PURCHASE AND ACCEPT from Seller,
the following described property, being intended to describe all of
the assets of the pawnshop business located at 000 Xxxxx Xxxxxxx Xxx.,
Xxxx Xxxxxxx, XX, 00000 except those excluded in Paragraph 2 below:
A. All furniture, fixtures, equipment and supplies of Seller located
at and used by Seller in the operation of the pawnshop business
owned by Seller at the address stated above.
B. All merchandise inventory owned and/or acquired through Seller's
pawnshop business or otherwise located at the address stated
above, and all existing rights to the merchandise;
C. All contracts to purchase and accounts receivable of Seller,
together with all promissory notes, contracts to purchase and
other evidences of indebtedness owed to Seller arising out of the
pawnshop business (including, but not limited to, the contracts
to purchase accounts of Seller heretofore furnished to Purchaser
for examination), together with all of Seller's rights in and
with respect to pawned merchandise securing same. Contracts to
purchase inventory consisting of firearms is specifically
included in the assets, but title to such inventory shall remain
vested in Seller until Purchaser has obtained its own license
from the Bureau of Alcohol, Tobacco and Firearms (ATF) for the
pawnshop, on which date title to such inventory shall vest in
Purchaser;
D. The right of Seller to not engage in any business of the nature
presently being operated by Seller at the address referred to
above, or any business similar thereto or any degree competitive
therewith, including any business subject to regulation as a
pawnshop by any governmental entity or agency or regulation under
the Federal Firearms Act, as hereinafter set out;
E. All layaway receivables and contracts, together with all
promissory notes, contracts and evidences of indebtedness owed to
Seller on such layaway receivables and contracts, together with
all rights to evidences of indebtedness, claims, choses in
action, liens, pledges and other instruments and security of
every kind and nature owned by Seller as security for and in any
manner securing or collateral to or for said layaway receivables
and/or contracts;
F. All of Seller's right, title and interest in and to the leasehold
assets in and upon the premises presently occupied by the
pawnshop business located at 000 Xxxxx Xxxxxxx Xxx., Xxxx
Xxxxxxx, XX, 00000.
G. Goodwill and all compilations and lists of present or former
customers and/or borrowers, all mailing lists, all business
records (including all records relating to borrowers, loan
accounts and contracts heretofore charged off on the books of
Seller, and all pawn and inventory records), all telephone
numbers, listings and advertisements (including specifically the
telephone number(s) set out above presently used by Seller in the
pawnshop business), all prepaid expenses, all utility deposits,
the right (but not the obligation) to assume Seller's experience
rating or other rating with any employment commission or
regulatory agency, all transferable and non-transferable licenses
and permits (specifically including Seller's pawnshop license),
unless otherwise excluded, and all intangibles and other rights
and privileges of Seller desirable or useful to Purchaser for the
purpose of continuing the pawnshop business of Seller and
maintaining and retaining the existing customers and business of
Seller, together with the right to use the trade name or assumed
name of Seller set out above, any other trade names presently or
formerly used by Seller in the pawnshop business, and any name so
similar as to require the consent of Seller to its rightful use,
for any lawful business purpose. In connection with the right to
use such similar name, Seller shall withdraw all Certificates or
Notices on file in any recording office in order that the name
referred to above or any similar name may be used by Purchaser.
Further, Purchaser shall have the right, but not the obligation,
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to hire any and all of the present employees of Seller. Purchaser
shall also have the right, but not the obligation, to assume any
rights, privileges or duties under any continuing contracts
relating in any way to the operation of the pawnshop business.
2. Assets Not To Be Transferred. Seller and Purchaser recognize and agree
that there is not sold as a part of the pawnshop business, the
following described assets:
A. Cash on hand;
B. Cash in banks;
C. Loans to affiliates;
D. Employee stockholder notes receivable;
E. Vehicles;
F. Seller's accounting forms or other work sheets;
G. Office furniture in Seller's office;
H. Animal Heads;
I. Store computers (Purchaser will be allowed to use the computers
for a period of six months);
3. Calculation of Purchase Price. The actual contracts to purchase
principal balance (the Contract Loan Balance) and the actual inventory
cost valuation ( the "Inventory Valuation") shall be verified and
determined by an on-the-premises audit and negotiation between the
parties. A list of the furniture, fixtures, equipment, pawn
transactions and inventory shall be prepared at the time of the audit
and attached hereto and incorporated herein by reference as Exhibit
"A. The Contract Loan Balance shall be equal to the amount of the
current contracts to purchase principal balance, unless Purchaser
determines that the Seller's cost exceeds fair market value for that
item, in which case the Contract Loan Balance for that item shall be
equal to its fair market value thereof. The Inventory Valuation,
furniture fixture and equipment valuation shall be equal to the net
book value of the inventory furniture fixture and equipment. The
purchase price shall be determined by adding the Contract Loan Balance
to the Inventory Valuation, furniture fixture and equipment valuation,
goodwill, covenant not to compete and trade secret covenants. The sum
so obtained shall be the total purchase price.
4. Purchase Price and Allocation of Purchase Price. The parties have
considered and negotiated the purchase price and allocation of the
purchase price. It is agreed and understood that the total purchase
price and allocation of the purchase price shall be set forth in
Exhibit "B" which will be completed prior to the closing. Seller and
Purchaser each agree to use the Exhibit "B" allocations in reporting
this transaction to any federal, state or local taxing authorities.
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5. Payment of Purchase Price. As consideration for the sale of the assets
described in Paragraph 1 above, Purchaser agrees to pay, the total
purchase price as follows:
A. $225,000.00 shall be paid by cashier's check on the transfer
date.
B. The remaining balance due shall be paid by Purchaser's Company
check, the receipt and sufficiency of which is hereby
acknowledged by Seller, except that $3,000.00 shall be held by
Purchaser in escrow for 60 days for payment of any unforeseen
expenses arising from Seller's operation of the business prior to
the transfer date.
C. In the event that Purchaser does not obtain a pawnshop license to
operate said businesses located at 0000 Xxxxx Xxxxxxx Xxxxxxx,
Xxxxxxxx, XX 00000, 0000 Xxxx Xxxxx Xxxx. Xxxxxxxx XX 00000 and
000 Xxxxx Xxxxxxx Xxx., Xxxx Xxxxxxx, XX, 00000 all funds paid to
Seller hereunder and under the Asset Purchase Agreement for the
0000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxxxxx, XX 00000, 0000 Xxxx Xxxxx
Xxxx. Xxxxxxxx XX 00000 stores shall be returned to the
Purchaser. Seller shall also pay to Purchaser all monies paid by
Purchaser for Contracts to Purchase and inventory while Purchaser
was operating aforesaid stores.
6. Right of Inspection Prior To The Closing Date. The Purchaser shall
have the right to inspect and physically audit the assets prior to the
Transfer Date, to confirm the representations made herein by Seller to
Purchaser. If the results of the audit are unacceptable to Purchaser,
then in its sole discretion, Purchaser may cancel this Agreement or
modify the purchase price or calculation thereof.
7. Closing. Closing will be on the Transfer Date.;
8. Contingencies. The asset purchase agreement will be specifically
contingent upon the following:
A. Approval of the transfer of the pawnshop license to Purchaser
pursuant to the provisions of applicable ordinances or laws in
the municipality or county where the pawnshop is located except
as provided in paragraph 5 C. The transfer fee shall be paid by
Purchaser.
B. Seller and Purchaser executing a new lease for the store located
at 000 Xxxxx Xxxxxxx Xxx., Xxxx Xxxxxxx, XX, 00000 in a form and
pursuant to terms reasonably acceptable to Purchaser.
C. The execution of a management agreement for firearms transaction
by Purchaser and Seller.
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D. At the time of the inventory, the Seller must have an approximate
Contract Loan balance of $115,117.00 and inventory with an
approximate value (net book value) of $72,956.00.
9. Covenant of Further Assistance. Without additional consideration,
Seller agrees to aid, assist and cooperate with Purchaser in all
respects in the orderly transfer to Purchaser of the business
operations of Seller, and to use all reasonable efforts to the end
that Purchaser shall realize a maximum retention of the customers and
general business and goodwill of Seller. Seller specifically agrees to
take all steps to complete all instruments, and to do everything
necessary or beneficial to assist in the orderly and fully effective
transfer of the business and assets covered hereby to Purchaser.
10. Additional Closing Procedures. Additional closing procedures, upon the
execution hereof, are agreed to be as follows:
A. Possession and title to all assets, except firearms contracts to
purchase, purchased hereunder shall pass to Purchaser as of the
Transfer Date so that Purchaser may thereafter commence its
business operations with all assets sold hereunder;
B. Upon the execution hereof and at any time thereafter, Seller
shall and does hereby agree to execute and deliver any other
releases, instruments, or documents required to complete any
legal requirements for the transfer of title to any assets sold
hereunder, consistent with the terms of this Agreement.
11. Liabilities To Be Assumed. It is specifically agreed and understood
that Purchaser does not and shall not assume any accounts payable of
Seller, nor any other obligations, liabilities or duties of Seller
arising out of or in any way connected with Seller's activities and/or
the operation of the pawnshop business prior to the Transfer Date,
except as specifically set forth herein and those obligations in
connection with contracts to purchase and accounts receivables
(layaways) which shall include, but not be limited to, the accounts
receivable deposits. Purchaser shall assume certain utility
obligations; provided, however, that such utilities shall be prorated
and paid by Seller at the Closing Date. Seller agrees to indemnify
Purchaser from any outstanding debts of Seller; provided Purchaser
shall afford Seller thirty (30) days in which to pay, compromise, or
defend any claim that may be a lien on the assets herein sold.
12. Possession of Property. Possession of all property sold hereunder
shall be effectively transferred to Purchaser as of the Transfer Date
and title to all such property, except firearm contracts to purchase,
shall be and has been delivered on the same date. It is recognized
that Seller has been operating a pawnshop business on the
above-described premises which Purchaser intends to continue
operating, and in connection therewith, the following additional
agreements are made:
A. All income earned before the Transfer Date shall be credited or
received by Seller, and all income earned or accrued after the
Transfer Date shall be credited and received by Purchaser;
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B. All expenses incurred or benefitting operations before the
Transfer Date shall be paid by Seller, and all expenses incurred
thereafter shall be paid by Purchaser;
C. Both parties agree to cooperate with each other so that there is
an orderly transfer of the business operations of the pawnshop
business, collection of all applicable income of each party, and
the payment of all applicable expenses attributable to each party
in accordance with this Agreement. All income collected by one
party attributable to the other shall, upon receipt, be
immediately remitted to the other party entitled to the income.
Any expenses attributable to one party presented for payment
after the Transfer Date shall be immediately paid by the party
owing such expense in accordance herewith, or such party shall
immediately reimburse the other party for any such expense paid
by such other party upon accounting therefor.
13. Seller's Warranties. Seller, and if there is more than one, then each
of them as Seller, individually and collectively, jointly, and
severally, all hereby make the following representations, warranties,
and guarantees to Purchaser, which representations, warranties, and
guarantees are in addition to and not exclusive of any other
representations, warranties, or guarantees made elsewhere in this
Agreement:
A. All contracts to purchase accounts, accounts receivable, notes
and other evidences of indebtedness reflected by Seller's books
and records as owed to and owned by Seller and which are being
transferred and sold to Purchaser represent bona fide assets of
Seller and bona fide transactions between Seller and the
respective parties to such transactions. Seller's books and
records, which are being delivered to Purchaser, contain an
accurate record of the amount loaned, the lawful finance charge
and other lawful charges, if any, to accrue thereon, renewals, if
any, and an accurate description of the pledged goods, and all
contracts to purchase accurately reflect the lawful finance
charge and other lawful charges, if any, applicable to the
transaction and merchandise pawned. All pawned merchandise
reflected by Seller's books and records is physically present on
the pawnshop premises at the address referred to above, and all
such merchandise is available for redemption or sale, as the case
may be;
B. Seller has complied with the provisions of state statute C.R.S.
ss. 00-00-000 et. seq. and the Pawnbroker provisions of Fort
Xxxxxxx Municipal Code;
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C. Seller is the owner of the pawnshop business and all assets of
every kind and nature being transferred to Purchaser hereunder,
and has good and marketable title to and the absolute right to
sell, assign, convey, transfer and deliver to Purchaser the
pawnshop business and such assets, free and clear of any
contracts, interests, security interests, claims, liens, pledges,
penalties, charges, encumbrances, buy-sell agreements or other
rights of any party whatsoever of every kind and character. Upon
payment of the purchase price in accordance with this Agreement,
good and marketable title to all such assets, except firearm
contracts to purchase, shall be and has become vested in
Purchaser, free and clear of any contracts, interests, security
interests, claims, liens, pledges, penalties, charges,
encumbrances, buy-sell agreements or other rights of any party
whatsoever;
D. No refunds, repayments or claims of any nature are now due or
will become due and payable relating to any transactions of
Seller, and all transactions of any nature have been entered into
and/or completed in accordance with all applicable statutes,
laws, rules, codes, regulations, and ordinances;
E. Seller is not a party to, nor is there any threat of any action,
lawsuit, claim or proceeding, whether judicial or administrative,
arising out of, in connection with, or in any way affecting any
of the business, assets or property being transferred under or in
connection with the terms of this Agreement;
F. There are no judgments, liens, claims, bankruptcy proceedings,
encumbrances, charges, demands, bankruptcy holds, police holds,
restitution owed to Seller, or security interests in effect or
outstanding against Seller. If there are any police or bankruptcy
holds, Seller will reimburse Purchaser for the current Contract
Loan Balance (or fair market value if there is not a current
Contract Loan Balance) of each hold;
G. Seller has not entered into any other currently valid or existing
contract relating to or affecting the business and assets sold
and conveyed pursuant to the terms of the Agreement;
H. Seller has not been, is not presently, and has no reason to
anticipate being considered, in violation of any statute, rule,
ordinance, regulation, decision, charge or order of any Court or
official or administrative body, nor is any type of action or
proceeding pending or threatened against Seller that could in any
respect affect the business and/or assets being transferred
pursuant to the terms of this Agreement;
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I. Seller has paid all ad valorem, FICA, payroll, withholding,
sales, income and unemployment insurance taxes owed to date,
except those not currently due and payable, and any taxes which
later become due and owing and are attributable to Seller's
ownership and/or operation of the pawnshop business prior to the
Transfer Date will be paid by Seller when due, and Seller will
comply with all requirements under all applicable tax law. No
deficiency assessment or proposed adjustment of Seller's United
States or Colorado taxes is pending, and Seller has no knowledge
of any proposed liability for any tax to be imposed upon Seller
or the Assets, for which there is not an adequate reserve
reflected in the financial information provided by Seller to
Purchaser;
J. There are no agreements with any labor union, other labor
organization or labor representatives applicable to or covering
the employees of Seller, nor are any discussions or negotiations
in anticipation of any such agreement presently under way or
anticipated, nor has there been any request made to enter any
such negotiations or to hold any type of election relating to
employer/employee relations or bargaining;
K. There are no oral or written agreements of employment with any
employee of the pawnshop business which are not terminable at
will with liability for such termination;
L. Seller has made no commitment to past or present employees
regarding expenses, pension, profit sharing or any other type of
compensation, benefit, option, remuneration or reimbursement;
M. Seller has complied with all applicable federal and state wage
and hour laws and regulations.
N. Purchaser will suffer no loss, cost or expense because of the
non-compliance of the parties hereto with any bulk transfer
statute or law;
O. Seller has full power and authority to execute and perform this
Agreement. All necessary action has been taken by Seller to
authorize the execution, delivery and performance of this
Agreement and the transaction contemplated hereby. This Agreement
has been duly executed and delivered and is a valid and binding
obligation of Seller, enforceable in accordance with its terms.
No consent, waiver, approval or authorization of, or declaration,
designation, filing, registration or qualification with, any
governmental or regulatory authority, or any other third party,
is required to be made or obtained by Seller in connection with
the execution, delivery and performance of this Agreement or the
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transaction contemplated hereby, or to preserve for Purchaser any
rights and benefits enjoyed by Seller on the date hereof
following the consummation of this transaction;
P. The execution, delivery and performance of this Agreement by
Seller will not conflict with or result in any breach of any of
the terms, conditions, or provisions of, or with the passage of
time or by the giving of notice, constitute a default, or result
in the creation of any lien, charge, claim or encumbrance upon
any of the properties or assets of Seller covered hereby, under
any contract, indenture, mortgage, deed of trust, agreement or
other instrument to which Seller is a party or by which any of
the property covered hereby may be bound or affected;
Q. The representations, warranties, and guarantees contained in this
Agreement and all information contained in any exhibits hereto,
and any other written documents furnished by Seller in connection
with the transaction contemplated hereby are true and correct in
all material respects. There are no facts known to Seller, which
are not also known to Purchaser, or generally known in the
pawnshop industry, which materially adversely affect or in the
future may (so far as Seller can now reasonably foresee)
materially adversely affect the pawnshop business or the
condition, properties, assets, operations or prospects of the
pawnshop business.
R. The premises currently occupied by seller satisfies all local
ordinances and Colorado statutes and seller has complied in all
material respects with all environmental laws, including
hazardous or toxic waste disposal laws and regulations applicable
to Seller and its business.
14. Risk of Loss. SELLER shall assume all risk of loss of the assets to be
sold due to destruction or damage due to fire or other casualty up to
the time of closing. PURCHASER shall have no right to terminate this
Agreement and waives any claims for damages against SELLER if the
business is curtailed or interrupted prior to closing by loss,
destruction, damage due to fire or other casualty, or condemnation. In
the event of damage to the assets to be conveyed, Seller at Seller's
option may either declare this Agreement void or enforce this sale
with a pro-rata adjustment for the conveyance of the non-damaged or
partially damaged assets.
15. Purchaser's Warranties. As an inducement to Seller hereunder,
Purchaser represents and warrants to Seller that:
A. Purchaser is a Colorado Corporation duly organized, validly
existing and in good standing under the laws of the State of
Colorado, with the authority to own, purchase and acquire
Seller's assets as described herein.
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B. This Agreement has been validly authorized by Purchaser.
C. Purchaser will apply forthwith to the appropriate authorities to
transfer or acquire a new pawnshop license in the name of the
Purchaser.
16. Conduct of Business. Up to and until the Transfer Date, Seller shall
continue to conduct its business and shall use reasonable efforts to
maintain its business relationships in the ordinary course and shall
not, without the prior written consent of Purchaser, take the
following actions which would adversely affect the Assets of the
pawnshop:
A. borrow any money;
B. enter into any agreement with any customer other than in the
ordinary and usual course of business;
C. incur any liability other than in the ordinary course of business
or in connection with the performance or consumption of this
agreement;
D. encumber or permit to be encumbered any of the assets;
E. dispose of any assets other than inventory which may be disposed
of in the ordinary course of business;
F. enter into any lease or contract for the purchase of any
property, real or personal.
17. Trade Secrets. As further consideration for the purchase price
provided for in Paragraph 4, Seller recognizes and acknowledges that
any and all compilations and lists of Seller's customers are valuable,
special and unique assets of the pawnshop business. Seller covenants
that Seller will not, directly or indirectly, for a five year period
from the date of this Agreement, or from the date of a final judgment
of a Court of competent jurisdiction enforcing this covenant,
whichever is later, disclose any compilation or list or identity of
Seller's customers or any part thereof, or any information of any
kind, nature or description concerning any matters affecting or
relating to the pawnshop business, its manner of operations, its
plans, processes, or other data of any kind, nature or description, to
any person, firm, corporation, association or other entity (other than
Purchaser, its agents and employees, and except as required by law)
for any reason or purpose whatsoever. The parties hereto stipulate
that as between them and the successors and assigns of the Purchaser,
all such items of information are important, material, confidential,
valuable, special unique assets that greatly affect the effective and
successful conduct of the pawnshop business and its goodwill and
disclosure of all such items of information will constitute a breach
of this Agreement. In the event that Seller violates or threatens to
violate or cause Purchaser to believe Seller may violate any of the
provisions of this paragraph, Seller specifically understands and
agrees that Purchaser shall be entitled to an injunction from any
Court having competent jurisdiction to legally enforce the covenants
and agreements stated herein, without prejudice to any of the other
rights or remedies which Purchaser may have and without the necessity
of Purchaser having to allege or prove irreparable harm or injury or
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the absence of an adequate remedy at law. The existence of any claim
or cause of action of any kind of Seller against Purchaser, whether
predicated in this Agreement or otherwise, shall not constitute a
defense to the enforcement of the covenants in this paragraph by
Purchaser.
18. Covenant Not To Compete. As further consideration for the purchase
price provided for in Paragraph 4 herein, Seller, for a five-year
period (the Non- Competition Period), shall not open, own, engage in,
consult, promote, advise or otherwise operate in any manner, any form
of business which competes directly or indirectly with any pawnshop,
jewelry or firearms business (collectively, the "Specified
Businesses") operated by Purchaser, in any area or location within a
ten-mile radius of Seller's store located at 000 Xxxxx Xxxxxxx Xxx.,
Xxxx Xxxxxxx, XX, 00000 and Purchaser's stores. With respect to
Customers, during the Non- Competition Period, Seller will not,
directly or indirectly, make any statement, written or oral, or
perform any other act or omission which is, or is likely to be,
materially detrimental to the goodwill of Purchaser. The parties
hereto stipulate that Seller is presently connected with and
conducting the pawnshop business at the address stated above and that
the restricted territory and Non-Competition Period specified herein
are reasonable, and that the restrictions are not oppressive to Seller
and do not deprive the public of competition or of needed goods or
services. The parties hereto further stipulate that this restrictive
covenant is necessary to protect the business that is being sold to
Purchaser. In the event that Seller violates or threatens to violate
or cause Purchaser to believe Seller may violate any of the provisions
of this paragraph, Seller specifically understands and agrees that
Purchaser shall be entitled to an injunction from any Court having
competent jurisdiction to legally enforce the covenants and agreements
stated herein, without prejudice to any of the other rights or
remedies which Purchaser may have and without the necessity of
Purchaser having to allege or prove irreparable harm or injury or the
absence of an adequate remedy at law. The existence of any claim or
cause of action of any kind of Seller against Purchaser, whether
predicated in this Agreement or otherwise, shall not constitute a
defense to the enforcement of the covenants in this paragraph by
Purchaser.
19. Indemnification. Seller and Purchaser, and if there is more than one,
then each of them as Seller and Purchaser, individually and
collectively, jointly and severally, agrees to fully indemnify and
save and hold each other harmless of and from any and all loss, costs,
or expense, of any type or nature and whensoever or howsoever
incurred, as a result of any breach of any warranty, representation,
covenant, guarantee, promise or agreement contained in this Agreement
or any instrument referred to in this Agreement or any instrument
executed pursuant to this Agreement. Such indemnity and covenant to
hold harmless shall include, but not be limited to, attorneys' fees
incurred with or without litigation, court costs, witness fees, travel
expenses, direct or indirect losses and overhead costs and payments to
third parties in settlement of any claim or judgment against Seller
and/or Purchaser by a creditor of or claimant against Seller or
Purchaser seeking to enforce against Seller and/or Purchaser any claim
against Seller and/or Purchaser as a result of or in any way arising
from Purchaser's purchase hereunder.
20. Seller's Right To Access To Certain Records. It is agreed that Seller
shall have, upon reasonable notice, the right of reasonable access to
the accounts, books, records and other information being transferred
to Purchaser to meet any requirements imposed upon Seller by any
statute, code, or rule of law. Purchaser shall not be required to keep
or maintain such items longer than it normally retains its own such
items.
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21. Construction of Agreement. This Agreement shall be construed under and
in accordance with the laws of the State of Colorado, even if executed
elsewhere, and even if pertaining to a business located elsewhere. All
of the terms, agreements, covenants, warranties, representations,
promises and conditions contained in this Agreement shall apply to, be
binding upon, and inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, legal representatives,
successors and assigns, and shall survive the closing hereunder and
the Transfer Date. In case any one or more of the provisions contained
in this Agreement or any instrument(s) executed pursuant to the terms
of this Agreement shall be held to be invalid, illegal, or
unenforceable in any respect for any reason, such invalidity,
illegality or unenforceability shall not affect any other provision
hereof, and this Agreement shall be construed as if such invalid,
illegal or unenforceable provisions had never been contained herein,
and specifically, with reference to the non-disclosure and/or
non-competitive covenant contained in the Agreement, the parties
hereto specifically agree that, in the event any Court of appropriate
jurisdiction should determine that any portion or provision of any
part of the language setting out such agreed to non-disclosure and/or
non-competitive covenant is invalid, unenforceable or excessively
restrictive, the parties agree that any such Court shall, and the
parties agree to request such Court to, rewrite such provision in
order to make such portion or provision legal, enforceable and
acceptable to such Court to the maximum extent permissible under the
law actually applied to determine the validity or reasonableness of
any such provision.
22. Entire Agreement. This agreement and the documents and papers executed
in accordance with the provisions herein at time of closing embrace
and include the entire transaction between the parties hereto. This
Agreement supersedes any and all other prior understandings and
agreements, either oral or in writing, between the parties hereto with
respect to the subject matter hereof. Each party to this Agreement
acknowledges that no representations, inducements, warranties,
covenants, guarantees, promises or other agreements, oral or
otherwise, have been made by any party, or by anyone acting on behalf
of any party, which are not embodied herein, and that no
representation, inducement, warranty, covenant, guarantee, agreement,
statement or promise not contained in this writing shall be valid or
binding or of any force or effect. However, notwithstanding any
investigation by Purchaser of the accounts, books, records, or any
other business of Seller, Purchaser shall be entitled to rely upon all
agreements, covenants, promises, warranties, representations, and
guarantees of Seller contained in this Agreement. No change or
modification of this Agreement shall be valid or binding upon the
parties hereto unless such change or modification shall be in writing
and signed by all of the parties hereto.
23. Broker Commissions. Seller represents and warrants that it has not
incurred any obligation to pay any brokerage commission or finder's
fee with regard to the transaction contemplated by this Agreement, and
Purchaser represents and warrants that any commission or other
compensation payable to any broker(s) engaged by it will be borne by
Purchaser. Purchaser hereby agrees to fully indemnify Seller, and
Seller hereby agrees to fully indemnify Purchaser, from and against
any and all liability (including, without limitation, reasonable
attorneys' fees and other costs of defending any such liability and
enforcing its indemnification) for payment of any commission, fee or
12
other compensation in the nature of a brokerage's commission or
finder's fee to any person, firm, or corporation claiming to have
acted on behalf of such indemnifying party in connection with the
transaction contemplated by this Agreement.
24. Costs. Purchaser and Seller shall each pay their own expenses and
costs (including, without limitation, all accountants' and attorneys'
fees) in connection with the negotiation, preparation and consummation
of this Agreement and the transaction contemplated hereby.
25. Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
26. Notices. Any notices required or permitted to be given pursuant to
this Agreement must be in writing and may be given by registered or
certified mail, shall be deemed to have been given and received
forty-eight (48) hours after a registered or certified letter
containing such notice, properly addressed with postage pre-paid, is
deposited in the United States mail; and if given other than by
registered or certified mail, it shall be deemed to have been given
when actually delivered to and received by the party to whom
addressed. Notice shall be given to the parties hereto at the
addresses to be designated by their signatures.
27. Default. If any action, at law or in equity, including any action for
declaratory relief, is brought to enforce or interpret the provisions
of this Agreement, the prevailing party or parties shall be entitled
to recover reasonable attorneys' fees from the other party or parties,
which fees may be set by the Court in the trial of such action or may
be enforced in a separate action brought for that purpose, and which
fees shall be in addition to any other relief that may be awarded.
28. Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective
successors and permitted assigns. No party may assign either this
Agreement or any of its rights, interests, or obligations hereunder
without the prior written approval of the other parties.
29. Execution. This Agreement may be executed in separate or multiple
counterparts, each of which shall be deemed an original, but all of
which together shall be considered as one and the same Agreement.
30. Gender. Whenever the context hereof shall so require, the singular
shall include the plural, the male gender shall include the female
gender and the neuter, and vice versa.
IN WITNESS WHEREOF, the parties have executed this Agreement on the 2nd day
of August, 1996.
SELLER'S ADDRESS:
/S/ XXXX XXXXXXXXX
0000 Xxxx Xxxxxxxx Xxxx ------------------------------------
Xxxxxxxx, XX 00000 Xxxx Xxxxxxxxx, President
CITY NATIONAL PAWN, INC., Seller
13
/S/ XXXXXX XXXXXX
-----------------------------------
XXXXXX XXXXXX, President
U.S. PAWN, INC., Purchaser
/S/ XXXXXXX X. XXX XXXXX
-----------------------------------
XXXXXXX X. XXX XXXXX,
Chief Financial Officer
PURCHASER'S ADDRESS:
0000 Xxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx
14
EXHIBIT "B"
PART II
ASSET AND PURCHASE PRICE ALLOCATION
1. Total Purchase Price $ 225,000.00
----------
A. Inventory $ 75,301.88
----------
B. Contract Loans $ 118,872.60
----------
C. Furniture, Fixtures and Equipment $ 12,632.00
----------
D. Less Layaways $ 2,743.00
----------
F. Subtotal (A + B + C - D) $ 204,063.48
----------
G. Remaining to be allocated (1-F) $ 20,936.52
----------
H. Non-Compete and Trade Secrets
(24% x G) $ 5,000.00
----------
I. Goodwill (76% x G) $ 15,936.52
----------
2. Total [F + H + I] (1 must equal 2) $ 225,000.00
----------
SELLER: PURCHASER:
CITY NATIONAL PAWN, INC., d/b/a U.S. PAWN, INC.
CITY NATIONAL PAWN
By: /S/ XXXX XXXXXXXXX By: /S/ XXXXXX XXXXXX
------------------------------- ------------------------------
Xxxx Xxxxxxxxx Xxxxxx Xxxxxx
President President
By: /S/ XXXXXXX X. XXX XXXXX
-----------------------------
Xxxxxxx X. Xxx Xxxxx
Chief Financial Officer
