EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement is entered into as of this 1st day of
October, 2001, among ATC Healthcare Services, Inc., a Georgia corporation
("Buyer"), Healthcare Staffing, Inc. d/b/a Doctors' Corner Personnel Service and
Healthcare Search Associates, a Delaware corporation qualified to do business in
California ("Seller"), and Gregorius X. Xxxx, an individual owning all of the
outstanding capital stock of Seller ("Balk").
RECITALS
WHEREAS, Seller conducts the business of providing temporary healthcare
personnel staffing together with the permanent placement of healthcare personnel
(the "Business"); and
WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase
from Seller the Business and the Acquired Assets on the terms provided herein;
NOW, THEREFORE, in consideration of the respective representations,
warranties, covenants and agreements contained herein, the parties agree as
follows:
ARTICLE I
PURCHASE AND SALE OF ACQUIRED ASSETS
1.1 Purchase and Sale. Upon the terms and subject to the conditions of
this Agreement and in reliance upon the representations, warranties, covenants
and agreements set forth herein, Buyer agrees to purchase from Seller and Seller
agrees to sell to Buyer at the Closing, free and clear of all Liens (as such
term is defined in Exhibit A hereto together with other defined terms), all of
the assets, properties, rights, interests, licenses, permits, contracts, causes
of action, claims and operations of Seller of every kind and description as the
same shall exist on the Closing Date (other than the Excluded Assets), wherever
located, whether tangible or intangible, real, personal or mixed which relate to
the ownership and/or conduct of the Business (the collective assets, properties,
rights, interests, licenses, permits, contracts, causes of action, claims and
operations of the Business to be transferred to Buyer by Seller pursuant hereto
are referred to collectively herein as the "Acquired Assets") and include,
without limitation, the following:
(a) all books and records of the Business, including, without
limitation, all customer lists, customer files, employee files and information,
databases regarding customers and employees and all manuals, advertising
materials, promotional material and brochures regarding the services provided by
the Business or otherwise used in the Business, and the telephone and fax
numbers and domain names of the Business;
(b) all contracts, leases or other agreements whether written
or oral relating to the Business to which the Seller is a party which are
identified on Exhibit B hereto ("Assumed Agreements");
(c) all trademarks, trade names, brand names, service marks,
copyrights, proprietary data, trade secrets and all other intellectual property
and intellectual property rights utilized in connection with the Business or
otherwise relating to the Business, including those set forth on Exhibit C
hereto, together with the goodwill of the Business associated therewith (the "IP
Rights");
(d) all rights of Seller in and to software used in the
operation of the Business, together with all manuals and other related technical
information;
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(e) equipment, furniture, office equipment, computer equipment
(including all hardware and software), communications equipment, and other
tangible property (and interests in any of the foregoing), including any of the
foregoing that are subject to capital leases;
(f) all rights, claims, credits, causes of action or rights of
set-off against third parties, whether liquidated or unliquidated, fixed or
contingent;
(g) all transferable franchises, licenses, permits or other
authorizations issued or granted by any governmental authority that are owned
by, granted to or held or used by Seller;
(h) all work in progress; and
(i) all goodwill associated with the Business or the Acquired
Assets.
1.2 Excluded Assets. The assets and properties set forth on Exhibit D
(the "Excluded Assets") shall be excluded from the Acquired Assets. The
Receivables are not included in the Acquired Assets.
1.3 Transition. Buyer and Seller will reasonably cooperate in order to
ensure an orderly transition of the Business to Buyer. Such cooperation will
include without limitation arrangements to ensure that telephone calls, e-mail,
mail, faxes and orders and inquiries are promptly forwarded to Buyer. Buyer and
Seller will also cooperate in transferring employees of Seller that Buyer
selects (if any) to Buyer. Seller shall be responsible for terminating employees
of Seller that Buyer does not so select.
1.4 Closure of Business. Immediately upon the Closing, except as
otherwise required hereunder or requested by Buyer, Seller shall cease operation
of the Business and transfer operation of the Business to Buyer.
1.5 Retained Liabilities. Except as provided in Section 1.6, the
parties agree that Buyer is not assuming (and Buyer and its Affiliates shall not
be responsible for) any liabilities or obligations of the Business as operated
prior to the Closing or of Seller and its Affiliates however arising (the
"Retained Liabilities"). Without limitation of the foregoing, Seller shall
retain, and Retained Liabilities shall include, all liabilities and obligations
(x) to employees of the Business (including severance and other obligations),
whether or not Buyer hires such employees, arising prior to the Closing (y)
arising from or in respect of the services provided by the Business prior to
Closing (whether or not the event giving rise to the liability or obligation
occurs prior to or after Closing) and (z) arising as a result of the violation
by Seller or the Business of Legal Requirements regarding the collection and
payment over to governmental authorities of sales, use, excise and similar
taxes, payroll and similar taxes and the withholding of taxes.
1.6 Assumed Liabilities. Buyer hereby assumes as of the Closing and
agrees to perform and discharge when due obligations of Seller under (x) the
Assumed Agreements with respect to periods after the Closing to the extent that
the consideration for any such services is paid to Buyer (other than any
obligations arising from the breach of such Assumed Agreements occurring at or
prior to Closing, which obligations shall constitute Retained Liabilities).
Obligations to be assumed by Buyer pursuant to this Section 1.6 are referred to
herein as "Assumed Liabilities."
1.7 Purchase Price and Payment. (a) In consideration for the Acquired
Assets, Buyer shall pay Seller the amount of Five Hundred Seventy-Five Thousand
($575,000) Dollars (the "Asset Amount"). In consideration for the covenant not
to compete in Section 5.13, Buyer shall pay Seller additional consideration in
the amount of Five Hundred Thousand ($500,000) Dollars (the "Additional
Consideration"). The Asset Price and the Additional Consideration are sometimes
collectively referred to herein as the "Purchase Price". At Seller's request, a
portion of the Purchase Price in consideration for the covenant not to compete
up to the amount of the Additional Consideration shall be paid directly to Balk
in lieu of Seller. Accordingly, Seller shall notify Buyer in writing at least
two (2) business days prior to payment of any installment under this Agreement
or the Promissory Note (as hereafter defined) specifying the amount of any such
installment that shall be paid directly to Balk. Any amounts to
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be so paid directly to Balk shall be credited toward payment of the
corresponding installment of the Purchase Price under this Agreement and/or the
Promissory Note.
(b) The Purchase Price shall be payable as follows:
(i) Three Hundred Thousand ($300,000) Dollars at the
Closing (as hereafter defined) by certified check or electronic transfer to a
bank account designated by Seller in writing at least two (2) business days
prior to the Closing (the "Initial Cash Payment").
(ii) Seven Hundred Seventy-Five Thousand ($775,000)
Dollars (the "Note Payments"), by delivery to Seller at the Closing of a duly
executed promissory note payable to Seller in the form of Exhibit E hereto
("Promissory Note"); provided that the total amount due to Seller under the
Promissory Note shall be subject to adjustment in accordance with the provisions
of Section 1.7(c) below.
The amount due to Seller under the Note Payments
shall bear interest at the rate of 8% per annum, beginning on the Closing Date
and will be due and payable in accordance with the following provisions:
(1) One Hundred Thousand ($100,000) Dollars,
together with interest thereon, shall be due and payable on the date which is
ninety (90) days after the Closing, subject to adjustment in accordance with the
provisions of Section 1.7(c) below;
(2) One Hundred Thousand ($100,000) Dollars,
together with interest thereon, shall be due and payable on the date which is
one hundred eighty (180) days after the Closing; and
(3) Five Hundred Seventy-Five Thousand
($575,000) Dollars shall be due and payable in twenty (20) consecutive quarterly
payments of principal in the amount of $28,750, each together with interest
thereon.
(c) In addition to the payment of the Purchase Price, Buyer
has agreed to pay to Resource Funding Group, Inc. ("RFG") at the Closing, on
behalf of Seller, an amount equal to the accounts receivable of the Business on
the date of the Closing anticipated to be approximately $200,000.00 (the "RFG
Payment Amount"). One business day prior to the Closing, RFG will provide to the
Buyer a detailed list of the open accounts receivable (the "RFG Receivables")
for Buyer's approval. During the ninety (90) day period immediately following
the Closing (the "Collection Period"), Buyer shall be entitled to make and
receive all collections on the RFG Receivables and Seller shall use its best
efforts to assist Buyer in making such collections. All payments received by
Buyer or Seller during the Collection Period on account of the RFG Receivables
shall belong solely to Buyer. Seller shall immediately remit to Buyer all
amounts which it may receive during the Collection Period on account of the RFG
Receivables.
If the aggregate amount of payments received by Buyer
during the Collection Period on account of the RFG Receivables is less than the
RFG Payment Amount, then (i) the first Note Payment due to Seller under the
Promissory Note under Section 1.7(b)(1) shall be reduced by the amount of the
difference between the RFG Payment Amount and the payments received by Buyer on
account of the RFG Receivables and (ii) the total principal sum payable under
the Promissory Note shall be correspondingly reduced by the amount of such
difference.
1.8 Allocation of Purchase Price. On or prior to the Closing Date, the
parties shall mutually agree on allocation of the Purchase Price in accordance
with Section 1060 of the Internal Revenue Code of 1986, as amended (the "Code").
All such mutually agreed to allocations shall be used by each party in preparing
any filing required pursuant to Section 1060 of the Code or any similar
provisions of state or local law and all relevant income and franchise tax
returns.
1.9 Collection of Receivables. Buyer shall not be responsible for the
collection of accounts receivable of the Business arising from the provision of
services prior to Closing as set forth on Exhibit F ("Receivables").
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ARTICLE II
CLOSING
2.1 Closing. The purchase and sale of the Acquired Assets and
assumption of the Assumed Liabilities pursuant to this Agreement (the "Closing")
will take place on October 1, 2001 or such other date as the parties may
mutually agree upon, at the offices of Kasowitz, Benson, Xxxxxx & Xxxxxxxx LLP,
0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m. EST. The date on which
the Closing is to occur is herein referred to as the "CLOSING DATE".
2.2 Deliveries at the Closing. At the Closing:
(a) The following deliveries will be made by Seller to Buyer:
(i) such appropriately executed bills of sale,
assignments and other instruments of transfer providing for the sale,
assignment, transfer, conveyance and delivery (including, to the extent
applicable, of record) of the Acquired Assets to Buyer in forms acceptable to
the Buyer;
(ii) copies of resolutions adopted by the board of
directors of Seller approving the execution and delivery by Seller of this
Agreement and the performance by the Seller of its obligations hereunder, all of
the foregoing certified as of the Closing Date by Seller's Secretary or
Assistant Secretary;
(iii) possession of the Acquired Assets, in such
manner as may reasonably be specified by Buyer;
(iv) a legal opinion of counsel to Seller, as to the
matters set forth on Exhibit G;
(v) such other documents as Buyer may reasonably
request in order to effectuate the transactions contemplated by this Agreement
to be consummated at the Closing.
(b) The following deliveries will made be made by Buyer to
Seller:
(i) the Initial Cash Payment;
(ii) the Promissory Note, duly executed by Buyer;
(iii) copies of resolutions adopted by the board of
directors of Buyer approving the execution and delivery by Buyer of this
Agreement and the performance by the Buyer of its obligations hereunder, all of
the foregoing certified as of the Closing Date by the Buyer's Secretary or
Assistant Secretary;
(iv) such other documents as the Seller may
reasonably request in order to effectuate the transactions contemplated by this
Agreement to be consummated at the Closing.
(c) The following deliveries will be made by Balk:
(i) a duly executed Employment Agreement between Balk
and the Buyer in the form of Exhibit H hereto; and
(ii) duly executed Employment Agreements between the
Buyer and each of Xxxxx Xxxxxx, Xxxxx Xxxxxx and Xxxxxxx Xxxxxxxxx, on terms and
in a form acceptable to the Buyer.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller and Balk each hereby represents and warrants, jointly and
severally, to Buyer as follows:
3.1 Organization and Good Standing. Seller is a corporation validly
existing and in good standing under the laws of the State of Delaware and is
qualified to do business in the State of California. Seller is not required to
be qualified to do business in any other jurisdiction as a result of the
operation or nature of the Business. Seller has the corporate power and
authority to own the Acquired Assets and to carry on the Business as now being
conducted. Balk owns all of the issued and outstanding capital stock of Seller.
3.2 Authority, Approvals and Consents. Seller has the corporate power
and authority to enter into this Agreement and the Ancillary Documents and to
perform its obligations hereunder and thereunder. The execution, delivery and
performance by Seller of this Agreement and each Ancillary Document and the
consummation of the transactions contemplated hereby and thereby have been duly
authorized and approved by the Board of Directors of Seller, and no other
corporate or other proceedings on the part of Seller or the shareholders of
Seller are necessary to authorize and approve this Agreement or the Ancillary
Documents and the transactions contemplated hereby or thereby. This Agreement
and each Ancillary Document has been duly executed and delivered by Seller and
Balk (as applicable). This Agreement and each Ancillary Document constitutes a
binding obligation of Seller and Balk (as applicable), enforceable against
Seller and Balk (as applicable), in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or similar laws affecting
creditors' rights generally or by the principles governing the availability of
equitable remedies. The execution, delivery and performance of this Agreement
and the Ancillary Documents by Seller and Balk, and the consummation of the
transactions contemplated hereby and thereby do not and will not:
(a) contravene any provisions of the certificate of
incorporation or bylaws of Seller (or other similar governing instruments with
different names);
(b) (after notice or lapse of time or both) conflict with,
result in a breach of any provision of, constitute a default under, result in
the modification or cancellation of, or give rise to any right of termination in
respect of, any contract, agreement, commitment, understanding or arrangement of
any kind to which Seller or Balk is a party or to which Seller or any Balk or
any of Seller's or Balk's property is subject;
(c) violate or conflict with any Legal Requirements applicable
to Seller or Balk or any of their business or property; or
(d) require Seller or Balk to obtain any Consent or Approval.
3.3 Financial Statements. Attached as Exhibit I is a true, correct and
complete copy of the unaudited financial statements of Seller in respect of the
Business as of December 31, 1999, and 2000, together with unaudited financial
statements for the fiscal year ended May 31, 2001, and gross margin calculations
for June and July, 2001, (collectively the "Financial Statements"). The
Financial Statements were prepared in accordance with generally accepted
accounting principles consistently applied ("GAAP") and fairly present the
financial condition and results of operations of Seller in respect of the
Business as of the dates and for the periods covered thereby. All information
made available to Buyer by Seller concerning the past and present financial
condition of Seller and the sales volume of the Business is complete and
accurate.
3.4 Absence of Undisclosed Liabilities. Seller does not have any
liability of any nature whatsoever (whether known or unknown, due or to become
due, accrued, absolute, contingent or otherwise), except (i) as and to the
extent reflected on the Financial Statements or (ii) liabilities incurred in the
ordinary course of business and consistent with past practice after July 31,
2001, and which are set forth in Schedule 3.4 hereto.
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3.5 Acquired Assets. (a) Seller has and will at the Closing convey to
Buyer good and marketable title to all of the Acquired Assets, free and clear of
any Liens.
3.6 Operation in the Ordinary Course. Since July 30, 2001, Seller has
conducted the Business only in the ordinary course and no event has occurred
that may reasonably be expected to have a material adverse effect on the
Business or its prospects.
3.7 Legal Matters. There is no claim, action, suit, litigation, formal
investigation or proceeding (a "Proceeding") pending against, or, to the
Knowledge of Seller, threatened against, Seller or any Affiliate, officer,
director, shareholder, agent or employee of Seller at law or in equity before or
by any court, arbitrator, panel, agency or other governmental, administrative or
judicial entity and none of Seller nor any of Seller's Affiliates, officers,
directors, shareholders, agents or employees is subject to any judgment, decree,
writ, injunction or order of any governmental, administrative or judicial entity
with respect to the Business or the Acquired Assets. The Business is being and
has been conducted in compliance with all governmental statutes, ordinances,
codes and regulations and the common law (collectively "Legal Requirements") and
holds all permits, licenses and approvals needed to operate the Business. To the
Knowledge of Seller, (i) there exists no basis for the making of any claim or
the bringing of any Proceeding against Seller, the Business or any officer,
director, employee or agent of Seller, and (ii) no Legal Requirement has been
proposed that may have a material adverse effect on the Business or its
prospects.
3.8 Assumed Agreements. Neither Seller nor, to the Knowledge of Seller
or Balk, any other party to any Assumed Agreement is in breach of or default
under any such Assumed Agreement. The consummation of the transactions
contemplated hereby will not require the Consent of any counterparty to an
Assumed Agreement and will not, after notice or lapse of time or both, conflict
with, result in a breach of any provision of, constitute a default under, result
in the modification or cancellation of, or give to any Person any right of
termination in respect of, any Assumed Agreement. Attached as Exhibit B is a
description of all Assumed Agreements setting forth, for each such Assumed
Agreement, the name of the other party, the nature of the contract and the
annual consideration payable.
3.9 Taxes. Seller has furnished Buyer with true, complete and correct
copies of Seller's 1998, 1999 and 2000 quarterly tax returns. Seller has
complied with all Legal Requirements in respect of the collection and payment
over to appropriate governmental agencies of sales, excise, use and other
similar taxes required to be collected by it. Seller has collected and paid over
to the appropriate governmental authorities all payroll and similar taxes
required to be collected and paid over by it and has complied with all Legal
Requirements regarding withholding of taxes from the income of employees.
3.10 Customers and Suppliers. To the Knowledge of Seller, there exists
no fact or circumstance which indicates that any customer of the Business that
purchased more than $50,000 of Seller's services or products in 2000 will not
purchase services or products in the year ending December 31, 2001, in amounts
at least equal to such purchases from Seller during 2000. There are no disputes
between Seller and any customers and suppliers of the Business. Since July 31,
2001, Seller has provided Services in such manner and in such quantities as are
consistent with past practice in the ordinary course of business, and has not
accelerated such sales prior to the Closing.
3.11 Intellectual Property. The Business and/or the Acquired Assets do
not violate or infringe in any manner on the intellectual property rights of any
other Person. To the Knowledge of Seller, no other Person has violated or
infringed intellectual property rights relating to the Business. The Acquired
Assets include all intellectual property rights utilized by the Seller to
operate the Business.
3.12 Employee and Related Matters; ERISA.
(a) Schedule 3.12(a) sets forth each employee stock option,
incentive, hospitalization, medical, dental, vision, life insurance, accidental
death and dismemberment insurance, business travel insurance, cafeteria and
flexible spending, sick pay, disability, severance, 401(k), golden parachute or
other plan, fund, program, policy, contract or arrangement providing employee
benefits that is maintained or contributed to by Buyer in which any employees
have participated or under which any employees have accrued and remain entitled
to any benefits (the
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"Plans"). No employee of Seller is entitled to any benefit under any Plan by
reason of the transactions contemplated hereby.
(b) None of Seller or any of the Plans or any trust created
thereunder, or any trustee or administrator thereof, has engaged in a
transaction in connection with which Seller would be subject to either a
material liability or civil penalty assessed pursuant to Sections 409, 502(i) or
502(1) of ERISA or a material tax imposed pursuant to Section 4971, 4972, 4974,
4975, 4976 or 4980B of the Code. Each of the Plans has been operated and
administered in all material respects in accordance with applicable laws,
including the Employee Retirement Income Security Act of 1974, as amended
("ERISA") and the Code. There are no pending or, to the Knowledge of Seller,
threatened claims by or on behalf of any of the Plans, by any employee or
beneficiary covered under any such Plan, or otherwise involving any such Plan
(other than ordinary course claims for benefits).
(c) Seller is not, and has not been within the last six years,
obligated to contribute, on behalf of any current or former employee of Seller,
to a multiemployer plan (as defined in Section 3(37) of ERISA).
(d) None of the Plans or any trust established thereunder has
incurred any accumulated funding deficiency (as defined in Section 302 of ERISA
and Section 412 of the Code), whether or not waived, as of the last day of the
most recent fiscal year of each of the Plans. No contribution failure has
occurred with respect to any Plan sufficient to give rise to a lien under
Section 302(f) of ERISA.
(e) With respect to any Plan that is an employee welfare
benefit plan (i) no such Plan is unfunded or funded through a welfare benefits
fund, as such term is defined in Section 419(e) of the Code and (ii) to the
Knowledge of Seller, each such Plan that is a group health plan, as such term is
defined in Section 5000(b)(1) of the Code, complies with the applicable
requirements of Section 4980B(f) of the Code.
3.13 Employee Relations. There is no pending or, to the Knowledge of
Seller, threatened grievance that would have a material adverse effect on the
Business or the Acquired Assets and no charges with respect to or relating to
Seller, any of its subsidiaries or Affiliates are pending before the Equal
Employment Opportunity Commission or any state agency responsible for the
prevention of unlawful employment practices as to which there is a reasonable
likelihood of adverse determination.
3.14 Insurance. Schedule 3.14 sets forth a complete and correct list of
all insurance policies presently maintained relating to the Business and the
Acquired Assets. The insurance policies constitute insurance against all risks
of a character and in such amounts as are usually insured against by similarly
situated companies in the same or similar business, all of such insurance
policies are in full force and effect and are valid, outstanding and
enforceable, and all premiums due thereon have been paid in full. Except as set
forth in Schedule 3.14, there are no pending material claims against such
insurance policies by Seller with respect to the Business or the Acquired Assets
as to which the applicable insurers have denied coverage. In addition, there
exist no material claims under such insurance policies that haven not been
properly filed by Seller with respect to the Business or the Acquired Assets.
3.15 Brokers. None of Seller nor any officer, director or employee
thereof, has employed or dealt with any broker or finder or has incurred or will
incur any broker's, finder's or similar fee, in commission or expense, in each
case in connection with the transactions contemplated by this Agreement, other
than Oxford Mergers and Acquisition, to whom a commission will be paid in
respect of this transaction by Seller.
3.16 Disclosure. All facts that a reasonable purchaser of the Acquired
Assets and Business would consider to be material have been disclosed to Buyer
by Seller in its due diligence investigation of the Business.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller as follows:
4.1 Organization. Buyer is a corporation validly existing and in good
standing under the laws of the State of Georgia. Buyer has the corporate power
and authority to own the Acquired Assets and to carry on the Business.
4.2 Power; Authorization; Consents. Buyer has the corporate power and
authority to enter into this Agreement and to perform its obligations hereunder.
The execution, delivery and performance of this Agreement by Buyer and the
consummation of the transactions contemplated hereby have been duly authorized
and approved by the Board of Directors of Buyer and no other corporate
proceedings on the part of Buyer or the shareholders of Buyer are necessary to
authorize and approve this Agreement and the transactions contemplated hereby.
This Agreement has been duly executed and delivered by Buyer. This Agreement
constitutes a valid and binding obligation of Buyer, enforceable against Buyer
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or similar laws affecting creditors' rights generally or by the
principles governing the availability of equitable remedies. The execution,
delivery and performance of this Agreement by Buyer and the consummation of the
transactions contemplated hereby do not and will not:
(a) contravene any provisions of Buyer's articles of
incorporation or by-laws;
(b) (after notice or lapse of time or both) conflict with,
result in a breach of any provision of, constitute a default under, result in
the modification or cancellation of, or give rise to any right of termination in
respect of, any contract, agreement, commitment, understanding or arrangement of
any kind to which Buyer is a party or to which Buyer or any of Buyer's property
is subject;
(c) violate or conflict with any Legal Requirements applicable
to Buyer or any of its business or property; or
(d) require Buyer to obtain any Approval or Consent.
4.3 Brokers. None of Buyer, nor any director, officer or employee
thereof has employed or dealt with any broker or finder or has incurred or will
incur any broker's, finder's or similar fee, commission or expense, in each case
in connection with the transactions contemplated by this Agreement.
ARTICLE V
COVENANTS AND ADDITIONAL AGREEMENTS
5.1 Announcements. Unless as required under applicable law, between the
date hereof and the Closing Date, no party hereto (and no Affiliate of any party
hereto) will issue any press release or otherwise make any public announcement
with respect to the transactions contemplated hereby without the prior written
consent of Buyer, in the case of Seller and its Affiliates, or Seller, in the
case of Buyer and its Affiliates. Nothing in this Section 5.1 shall restrict
Buyer from notifying customers of the Business of the sale of the Business to
Buyer.
5.2 Further Assurances. Each party shall execute and deliver such
instruments and take such other actions prior to or after the Closing as any
other party may reasonably request in order to carry out the intent of this
Agreement, including, without limitation, obtaining any required consents or
approvals from governmental entities or other third parties, and each party
hereby agrees to use its respective reasonable best efforts to consummate the
transactions contemplated hereby as soon as is practicable. From time to time
after the Closing, Buyer and Seller shall for no additional consideration
execute and deliver or cause to be executed and delivered such further
documents, certificates and instruments of conveyance, assignment and transfer,
and take such further action, as Buyer or Seller may reasonably request in order
more effectively to sell, assign, convey, transfer, reduce to possession and
record title to any of the Acquired Assets to Buyer. Each party shall cooperate
and deliver such instruments and
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take such action as may be reasonably requested by the other party hereto in
order to carry out the provisions and purposes of this Agreement and the
transactions contemplated hereby. Seller hereby irrevocably appoints Buyer as
its attorney-in-fact to execute documents, certificates and instruments in
Seller's name in order to more effectively assign, convey, transfer, reduce to
possession and record title to any of the Acquired Assets to Buyer. Such power
of attorney is coupled with an interest and irrevocable.
5.3 Consents and Approvals. Between the date hereof and the Closing
Date, the parties hereto shall cooperate with each other and use their
reasonable best efforts to promptly prepare and file all necessary
documentation, to effect all applications, notices, petitions and filings, and
to obtain as promptly as practicable all consents, approvals and authorizations
of all third parties which are necessary or advisable to consummate the
transactions contemplated by this Agreement. The parties hereto agree that they
will consult with each other with respect to the obtaining of all consents,
approvals and authorizations of all third parties necessary or advisable to
consummate the transactions contemplated by this Agreement and each party will
keep the other apprized of the status of matters relating to completion of the
transactions contemplated hereby.
5.4 Tax Reporting and Cooperation on Tax Matter. Seller shall comply
with all tax reporting obligations in connection with the Assets and the Assumed
Liabilities on or before the Closing Date, and Buyer shall comply with all tax
reporting obligations with respect to the same after the Closing Date. The
parties shall provide each other with such assistance as may reasonably be
requested by any of them in connection with the preparation of any tax return
that may be required to be filed by it, any audit or other explanation by any
taxing authority, or any judicial or administrative proceedings relating to
liability for taxes. The party requesting assistance hereunder shall reimburse
the other for reasonable out-of-pocket expenses incurred in providing such
assistance.
5.5 Activities Pending Closing. From the date hereof until the Closing
Date, except as expressly contemplated or permitted by this Agreement or with
the prior written consent of Buyer or Balk, Seller shall carry on its business
in the ordinary course consistent with past practices and use all reasonable
efforts to preserve intact its present business organizations and relationships.
Without limiting the generality of the foregoing, except with the prior written
consent of Buyer or as expressly contemplated hereby, between the date hereof
and the Closing Date, neither of Seller or Balk, shall take any action that
would (i) result in any of the representations and warranties of Seller or Balk
contained in this Agreement not to be true and correct in any material respect
at the Closing Date or (ii) adversely affect the ability of Buyer to consummate
the transaction contemplated hereby.
5.6 Commercially Reasonable Efforts. Each of the parties hereto shall
employ commercially reasonable efforts to cause each of the conditions to the
consummation of the transactions contemplated hereby applicable to it to be
fulfilled in accordance with the terms and conditions of this Agreement as soon
as practicable after the date hereof.
5.7 Exclusivity. Until the Closing Date or the termination of this
Agreement, Seller and Balk shall not and shall not permit any Affiliates thereof
or representative to, directly or indirectly, encourage, initiate or engage in
discussions or negotiations with or provide any information to, any Person or
group, other than Buyer concerning any proposal for an acquisition or other
business combination involving all or any part of the Business or the Acquired
Assets or relating thereto or any interest therein.
5.8 Use of Name. Subsequent to the Closing Date, Buyer shall have sole
right and title in the names "Healthcare Staffing, Inc.", "Doctor's Corner
Personnel Service" and "Healthcare Search Associates" and all variations
thereof, and neither Seller, Balk nor any Affiliate thereof shall use the names
"Healthcare Staffing, Inc.", "Doctor's Corner Personnel Service" or "Healthcare
Search Associates" or any variation thereof subsequent to the Closing Date.
5.9 Disclosure Supplements. From time to time prior to the Closing,
each party shall promptly supplement or amend any materials previously disclosed
to the other party pursuant hereto with respect to any matter hereafter arising
which, if existing, occurring or known at the date of this Agreement, would have
been required to be set forth or described in materials previously disclosed to
the other party or which is necessary to
9
correct any information in such materials or statement herein which has been
rendered materially inaccurate thereby; no such supplement or amendment to such
materials shall be deemed to have modified the representations, warranties and
covenants of the parties for the purpose of determining whether the conditions
set forth in Article VI hereof have been satisfied.
5.10 Failure to Fulfill Conditions. In the event that any party hereto
determines that a condition to its respective obligations to consummate the
transactions contemplated hereby cannot be fulfilled on or prior to the
termination of this Agreement, it will promptly notify the other parties. Each
party will promptly inform the other parties of any facts applicable to it that
would be likely to prevent or materially delay approval of the transaction
contemplated hereby by any third party or which would other wise prevent or
materially delay completion of such transactions.
5.11 Execution of Assignments. Concurrent with the Closing, Seller
shall execute and assign, and Buyer may, at its option, accept an assignment of,
all leases, vendor agreements and any other executory contracts to be assumed by
Buyer and Seller shall deliver to Buyer at the Closing executed consents to such
assignments by all landlords, vendors and other applicable third parties, at the
sole expense of Seller.
5.12 Preservation of Seller. For a period of three (3) years following
the Closing Date, Seller and Balk shall take no action to dissolve or liquidate
Seller without the prior delivery to Buyer of the assumption in writing by
another Person satisfactory to Buyer, in its sole discretion, of all Seller's
duties, liabilities, responsibilities and obligations under this Agreement.
5.13 Covenant not to Compete, Non-Solicitation, Confidentiality. (a)
For a period of seven (7) years beginning on the Closing Date, neither Balk nor
Seller shall directly or indirectly, engage (whether as owner, operator,
shareholder, manager, employee or consultant) in any business in competition
with the Business as conducted by Buyer and its Affiliates in those
jurisdictions in which the Business is conducted by Buyer and its Affiliates,
provided that the foregoing restriction shall not prohibit any such Person from
owning up to 2% of the outstanding common equity of any company listed on a
public securities market. It is the desire and intent of the parties that the
provisions of this Section 5.13 shall be enforced to the fullest extent
permitted under the laws and public policies of each jurisdiction in which
enforcement is sought. If any court determines that any provision of this
Section 5.13 is unenforceable, such court shall have the power to reduce the
duration or geographical or temporal scope of such provision, as the case may
be, and, in its reduced form, such provision shall be enforceable; it is the
intention of the parties that the foregoing restrictions shall not be terminated
but shall be deemed amended to the extent required to render them valid and
enforceable, such amendment to only apply with respect to the operation of this
Section 5.13 in the jurisdiction of the court that has made the adjudication.
(b) For a period of seven (7) years beginning on the Closing
Date neither Seller nor Balk shall, directly or indirectly, solicit for
employment (other than through general advertising) or hire either as an
employee or as a consultant any person employed by Buyer or its Affiliates at
any time within one year of the act of solicitation or hiring.
(c) For a period of seven (7) years beginning on the Closing
Date, each of Seller and Balk shall hold confidential and not use in any manner
all confidential information of the Business in their or his possession,
provided that confidential information of the Business shall not include
information that is or becomes publicly available (other than through a breach
of this paragraph (c)).
(d) The parties acknowledge and agree that the restrictions
contained in Section 5.13(a), (b) and (c) are a reasonable and necessary
protection of the immediate interests of Buyer, and any violation of these
restrictions would cause substantial injury to Buyer and that Buyer would not
have entered into this Agreement without receiving the additional consideration
offered by the Seller and Balk in binding themselves, to these restrictions. In
the event of a breach or a threatened breach by the Seller or Balk of these
restrictions, Buyer shall be entitled to an injunction restraining such Person
from such breach or threatened breach without the necessity or proving actual
damages, the inadequacy of monetary damages or posting any bond or security;
provided, however,
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that such right to injunctive relief shall not be construed as prohibiting Buyer
from pursuing any other available remedies for such breach or threatened breach.
Allocation of a portion of the purchase price hereunder to the covenant not to
compete shall not be deemed to be a measurement of Buyer's damages in the event
of breach thereof or otherwise limit Buyer's remedies therefor.
(e) In the event of a termination of the Employment Agreement
between Balk and the Buyer due to either a voluntary termination by the Buyer or
a default by Buyer of the terms of such agreement, the provisions of Sections
5.13(a) and (b) of this Agreement shall terminate and be of no further force or
effect.
5.14 Buyer agrees that each employee of Seller who was employed for at
least the entire 5 year period immediately prior to Closing who becomes an
employee of Buyer immediately after the Closing shall be entitled to Paid Time
Off ("PTO") during the initial twelve months of employment as follows:
(i) 9.5 days at the Closing
(ii) An additional 9.5 days at January 1, 2002
ARTICLE VI
CONDITIONS PRECEDENT
6.1 Conditions Precedent - Buyer and Seller. The respective obligations
of Buyer and Seller to effect the transactions contemplated by this Agreement
shall be subject to the satisfaction of the following conditions on or prior to
the Closing Date:
(a) All approvals, consents and waivers from, or filings or
registrations with, any governmental entity which is required for the
consummation of the transactions contemplated hereby shall have been received or
made, as applicable, provided, however, that no approval, consent or waiver
referred to in this Section 6.1(a) shall be deemed to have been received if it
shall include any condition or requirement that, individually or in the
aggregate, would so materially reduce the economic or business benefits of the
transactions contemplated by this Agreement to Buyer that had such condition or
requirement been known, Buyer, in its reasonable judgment, would not have
entered into this Agreement.
(b) Neither Buyer nor Seller shall be subject to any statute,
rule, regulation, injunction or other order, decree of Legal Requirement which
shall have been enacted, entered, promulgated or enforced by any governmental
entity which prohibits, restricts or makes illegal consummation of the
transactions contemplated hereby.
6.2 Conditions Precedent - Buyer. The obligations of Buyer to effect
the transactions contemplated by this Agreement shall be subject to satisfaction
of the following conditions at or prior to the Closing Date, unless waived by
Buyer.
(a) The representations and warranties of Seller and Balk set
forth in Article III hereof shall be true and correct in all material respects
as of the date of this Agreement and as of the Closing Date as though made on
and as of the Closing Date (or on the date when made in the case of any
representation and warranty which specifically relates to an earlier date).
(b) Seller and Balk shall have performed in all material
respects all obligations and covenants required to be performed by them pursuant
to this Agreement on or prior to the Closing Date.
(c) Seller shall have delivered to Buyer a certificate, dated
the Closing Date and signed by the President of Seller, to the effect that the
conditions set forth in Section 6.2(a) and (b) have been satisfied.
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(d) Seller shall have delivered to Buyer, all in such forms as
Buyer may reasonably specify: (i) bills of sale, assignments of leases and
contracts and such other goods and sufficient instruments of assignment,
transfer and conveyance as shall be necessary or advisable to vest in Buyer all
right, title and interest in and to the Acquired Assets and the Assumed
Liabilities, and (ii) all other documents Buyer may reasonably request relating
to the authority of Seller and Balk to execute and perform under the provisions
of this Agreement.
(e) The consent, approval or waiver of each person, firmer
entity (other than the governmental entities referred to in Section 6.1(a)
hereof) whose consent, approval or waiver shall be required in connection with
the transactions contemplated hereby shall have been obtained.
(f) No action, suit, investigation or other proceeding shall
be pending or threatened against any party to this Agreement which, in the
reasonable opinion of Buyer could result in the restraint or prohibition of any
such party, or the obtaining of damages or other relief from any such party, in
connection with this Agreement or the transactions contemplated hereby.
(g) Seller and Balk shall have furnished Buyer with such
certificates and such other documents to evidence fulfillment of the conditions
set forth in Sections 6.1 and 6.2, as such conditions relate to Seller, as Buyer
may reasonably request.
(h) Buyer shall have received an opinion of counsel to Seller
as to the matters set forth in Exhibit G in a form satisfactory to Buyer and its
counsel.
(i) Balk shall have delivered to Buyer (i) a duly executed
Employment Agreement in the form of Exhibit H hereto and (ii) duly executed
Employment Agreements for each of Xxxxx Xxxxxx, Xxxxx Xxxxxx and Xxxxxxx
Xxxxxxxxx on terms and in a form acceptable to Buyer.
(j) There shall have been between the date hereof and the
Closing Date, no material adverse change in the condition, financial or
otherwise, of Seller, the Business or the Acquired Assets and at the Closing
Date Seller shall have delivered to Buyer a certificate to such effect signed by
the President of Buyer.
6.3 Conditions Precedent - Seller. The obligations of Seller to effect
the transactions contemplated by this Agreement shall be subject to the
satisfaction of the following conditions on or prior to the Closing Date, unless
waived by Seller.
(a) The representations and warranties of Buyer set forth in
Article IV hereof shall be true and correct in all material respects as of the
date of this Agreement and as of the Closing Date (or on the date when made in
the case of any representation and warranty which specifically relates to an
earlier date).
(b) Buyer shall have performed in all material respects all
obligations and covenants required to be performed by it pursuant to this
Agreement on or prior to the Closing Date.
(c) Buyer shall have delivered to the Seller a certificate,
dated the Closing Date and signed by the President of Buyer, to the effect that
the conditions set forth in Section 6.3(a) and (b) have been satisfied.
(d) Buyer shall have delivered to Seller the Initial Cash
Payment and the Promissory Note.
(e) Buyer shall have delivered to Balk (i) a duly executed
Employment Agreement in the form of Exhibit H hereto and (ii) duly executed
Employment Agreements for each of Xxxxx Xxxxxx, Xxxxx Xxxxxx and Xxxxxxx
Xxxxxxxxx on terms and in a form acceptable to Buyer.
(f) Buyer shall have furnished Seller with such certificates
and such other documents to evidence fulfillment of the conditions set forth in
Sections 6.1 and 6.3 as such conditions relate to Buyer as Seller may reasonably
request.
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ARTICLE VII
SURVIVAL AND INDEMNIFICATION
7.1 Survival. The representations and warranties contained in or made
pursuant to this Agreement will survive the Closing. All other provisions of
this Agreement will survive the Closing without limitation. The provisions of
this Article VI are in addition to any other remedy any party hereto may have.
7.2 Seller's Indemnification Obligation. (a) Seller and Balk shall
jointly and severally indemnify and hold harmless Buyer and its Affiliates and
their officers, directors and shareholders ("Buyer Indemnified Parties") from
and against any and all Losses which are incurred by or asserted against one or
more Buyer Indemnified Parties:
(i) resulting from the breach of any representation
or warranty made by Seller or Balk in this Agreement;
(ii) resulting from the breach of any covenant or
agreement of Seller or Balk contained herein or in any Ancillary Document; or
(iii) constituting or arising from Retained
Liabilities.
(b) Seller agrees that, notwithstanding any other provision of
this Agreement, Buyer Indemnified Parties may offset all claims for
indemnification under Section 7.2(a) against any payment to be made to or for
the account of Seller pursuant to this Agreement, including without limitation
on account of Receivables and payments due under the Promissory Note.
7.3 Buyer's Indemnification Obligation. Buyer shall indemnify and hold
harmless Seller and its Affiliates and their officers, directors and
shareholders ("Seller Indemnified Parties") from and against any and all Losses
which are incurred by or asserted against one or more Seller Indemnified
Parties:
(i) resulting from the breach of any representation
or warranty made by Buyer in this Agreement;
(ii) resulting from the breach of any covenant or
agreement of Buyer contained herein; or
(iii) constituting Assumed Liabilities.
7.4 Procedure. Any claim for indemnification under Sections 7.2 or 7.3
will be made in accordance with this Section 7.4. In the case of any claim for
indemnification arising from a claim or demand of a third Person, an Indemnified
Party will give prompt written notice, in no event more than thirty (30) days
following such Indemnified Party's receipt of such claim or demand, to the
Indemnifying Party describing in reasonable detail the basis of such claim or
demand as to which it may request indemnification hereunder. Any other claim for
indemnification will be made within a reasonable time after the time the
Indemnified Party becomes aware of the facts forming the basis of such claim.
Notwithstanding the foregoing, failure or delay in giving such notices shall not
relieve the Indemnifying Party from its obligation to indemnify the Indemnified
Party except to the extent the Indemnifying Party is actually and materially
prejudiced by such failure or delay. If the Indemnifying Party accepts
responsibility for any such third-Person claim or demand by written notice to
the Indemnified Party within ten (10) days of receipt of the notice described
above (and provides assurances that it will and makes provision to satisfy any
Losses in respect thereof, which assurances and provision shall be reasonably
satisfactory to the Indemnified Party), the Indemnifying Party will have the
right to defend and to direct the defense against any such claim or demand, in
its name or in the name of the Indemnified Party, as the case may be, at the
expense of the Indemnifying Party and with counsel selected by the Indemnifying
Party and reasonably satisfactory to the Indemnified Party, provided that the
Indemnifying Party may not settle or compromise any such claim or demand without
the written consent of the
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Indemnified Party (which consent may not be unreasonably withheld or delayed) if
injunctive or other equitable relief would be imposed against the Indemnified
Party as a result thereof or, where the Indemnified Party is a Buyer Indemnified
Party, the settlement or compromise would have an adverse effect on the
Business. The Indemnifying Party shall keep the Indemnified Party fully informed
in the defense of any such claim or demand. The Indemnified Party will have the
right to participate in (but not control) the defense of any claim or demand as
to which the Indemnifying Party has assumed control with counsel employed by it
at the expense of the Indemnified Party. The Indemnifying Party will have no
indemnification obligations with respect to any such claim or demand which is
settled by the Indemnified Party without the prior written consent of the
Indemnifying Party (which consent may not be unreasonable withheld or delayed).
ARTICLE VIII
MISCELLANEOUS
8.1 Expenses. The fees and expenses (including the fees of any lawyers,
accountants or others engaged by such party) in connection with this Agreement
and the transactions contemplated hereby will be paid by Buyer with respect to
Buyer, by Seller with respect to Seller, and by Balk with respect to Balk.
8.2 Notices. Any notice or other communication required or permitted to
be given hereunder will be in writing and will be mailed by prepaid registered
or certified mail, timely deposited with an overnight courier such as Federal
Express, or delivered against receipt (including by confirmed facsimile
transmission), as follows:
(a) In the case of Seller and/or Balk, to:
Xx. Xxxxxxxxx X. Xxxx
Healthcare Staffing, Inc.
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxx Xxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxxxxxx
Corcovelos & Xxxxx LLP
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx Xxxxx, XX 00000
(b) In the case of Buyer, to:
ATC Healthcare Services, Inc.
0000 Xxxxxx Xxxxxx
Xxxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxx Xxxxxxxx
with a copy to:
Kasowitz, Benson, Xxxxxx & Xxxxxxxx LLP
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxxxx, Esq.
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or to such other address as the party may have furnished in writing in
accordance with the provisions of this Section. Any notice or other
communication shall be deemed to have been given, made and received upon
receipt; provided, that any notice or communication that is received other than
during regular business hours of the recipient shall be deemed to have been
given at the opening of business on the next business day of the recipient.
8.3 Assignment. This Agreement and all provisions hereof will be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that neither this Agreement
nor any right, interest or obligation hereunder may be assigned by any party
hereto without the prior written consent of the other party, except that Buyer
may assign its rights and obligations hereunder to any Affiliate or transferee
of that part of its business to which such rights and obligations relate. Any
assignment in violation of this Agreement shall be null and void.
8.4 Entire Agreement. This Agreement and the Ancillary Documents embody
the entire agreement and understanding of the parties with respect to the
transactions contemplated hereby and thereby and supersede all prior written or
oral commitments, arrangements or understandings with respect hereto. There is
no restriction, agreement, promise, warranty, covenant or undertaking with
respect to the transactions contemplated hereby and thereby other than those
expressly set forth herein.
8.5 Amendment; Waiver. (a) This Agreement may only be amended or
modified in a writing signed by the party against whom enforcement of any such
amendment or modification is sought.
(b) No breach of any covenant, agreement, representation or
warranty made herein shall be deemed waived unless expressly waived in writing
by the party who might assert such breach. No omission or failure to exercise
and no delay in exercising any right, remedy or power hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, remedy
or power hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy or power provided herein or by law or in
equity. The waiver by any party hereto of a breach of any term or provision of
this Agreement will not be construed as a waiver of any subsequent breach.
8.6 Counterparts. This Agreement may be executed in two or more
counterparts, all of which will be considered one and the same agreement and
each of which will be deemed an original.
8.7 Governing Law. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (REGARDLESS OF THE LAWS THAT MIGHT BE APPLICABLE UNDER
PRINCIPLES OF CONFLICTS OF LAW) AS TO ALL MATTERS, INCLUDING, WITHOUT
LIMITATION, MATTERS OF VALIDITY, CONSTRUCTION, EFFECT AND PERFORMANCE.
8.8 Severability. If any one or more of the provisions of this
Agreement is held to be invalid, illegal or unenforceable, the validity,
legality or enforceability of the remaining provisions of this Agreement will
not be affected thereby, and Seller, Balk and Buyer will use their reasonable
efforts to substitute one or more valid, legal and enforceable provisions which
insofar as practicable implement the purposes and intent hereof. To the extent
permitted by applicable law, each party waives any provision of law which
renders any provision of this Agreement invalid, illegal or unenforceable in any
respect.
8.9 Specific Performance. Buyer, Seller and Balk and the Additional
Parties recognize that any breach of the terms of this Agreement may give rise
to irreparable harm for which money damages would not be an adequate remedy, and
accordingly agree that, in addition to other remedies, any nonbreaching party
will be entitled to enforce the terms of this Agreement by a decree of specific
performance without the necessity of proving the inadequacy of money damages as
a remedy.
8.10 Arbitration. In the event of a dispute arising from or in
connection with any provision of this Agreement, the parties agree to submit
such dispute to final and binding arbitration in accordance with the
then-obtaining commercial arbitration rules of the American Arbitration
Association ("AAA"). Such arbitration
15
shall be held in the AAA office in New York, New York; provided that if any
arbitration proceeding is initiated by Seller such arbitration shall be held in
the AAA Office nearest to Los Angeles, California. The parties shall share
equally the costs and arbitrator's fees incurred in connection with such
arbitration, but each party shall be responsible for their own attorneys fees.
The arbitrators shall have no authority to modify or add to the provisions of
this Agreement.
8.11 Third Person Beneficiaries. This Agreement is not intended to
confer upon any other Person any rights or remedies hereunder, except that Buyer
and Seller may assert the rights of the Buyer Indemnified Parties and Seller
Indemnified Parties, respectively, hereunder.
8.12 Bulk Transfer Law. The parties hereby waive compliance by Buyer
and Seller with the provisions of any applicable bulk sales law and, without
limitation of any other remedy Buyer may have, Seller agrees to indemnify and
hold harmless Buyer Indemnified Parties from any Loss asserted against any Buyer
Indemnified Party or which any Buyer Indemnified Party may suffer or incur by
virtue of any noncompliance by Buyer or Seller with such laws.
8.13 Transfer Taxes. Seller shall pay all sales, use, transfer and
other similar tax and fees resulting from the transactions contemplated by this
Agreement.
16
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
ATC HEALTHCARE SERVICES, INC.
By: /s/ XXXXX XXXXXXXX
---------------------------
Name: Xxxxx Xxxxxxxx
Title: President
HEALTHCARE STAFFING INC.
By: /s/ GREGORIUS X. XXXX
---------------------------
Name: Gregorius X. Xxxx
Title: President
------------------------------
Gregorius X. Xxxx
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EXHIBIT A
Certain Definitions
"AAA" means American Arbitration Association.
"ADDITIONAL CONSIDERATION" shall have the meaning set forth in Section
1.7.
"AFFILIATE" shall mean, with respect to a Person, another Person
heretofore, now or hereafter, directly or indirectly, through one or more
intermediaries, controlled by, under common control with or which controls, the
Person specified (in each case in their capacities as such).
"AGREEMENT" shall mean this Agreement.
"ANCILLARY DOCUMENTS" means all agreements, instruments, documents or
certificates contemplated to be executed and/or delivered by Seller and/or Balk
pursuant to Section 2.2(a) and (c).
"APPROVAL" shall mean any franchise, license, certificate of
compliance, authorization, consent, order, permit, approval or other action of,
or any filing, registration or qualification with, any federal, state, municipal
or other governmental, administrative or judicial body, agency or authority.
"ACQUIRED ASSETS" shall have the meaning set forth in Section 1.1.
"ASSET AMOUNT" shall have the meaning set forth in Section 1.7.
"ASSUMED LIABILITIES" shall have the meaning set forth in Section 1.6.
"ASSUMED AGREEMENTS" shall have the meaning set forth in Section
1.1(b).
"BALK" shall have the meaning set forth in the heading to this
Agreement.
"BUSINESS" shall have the meaning set forth in the recitals to this
Agreement.
"BUYER" shall have the meaning set forth in the heading to this
Agreement.
"BUYER INDEMNIFIED PARTIES" shall have the meaning set forth in Section
7.2.
"CLOSING" shall have the meaning set forth in Section 2.1.
"CLOSING DATE" shall have the meaning set forth in Section 2.1.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"COLLECTION PERIOD" shall have the meaning set forth in Section 1.7(c).
"CONSENT" shall mean any consent or approval of, or notice,
declaration, report or statement filed with or submitted to, any Person (other
than an Approval).
"ERISA" shall mean the Employee Retirement Income Security Act, as
amended.
"EXCLUDED ASSETS" shall have the meaning set forth in Section 1.2.
"FINANCIAL STATEMENTS" shall have the meaning set forth in Section 3.3.
"INDEMNIFIED PARTY" shall mean the Buyer Indemnified Party or Seller
Indemnified Party seeking indemnification pursuant to Article VII.
"INDEMNIFYING PARTY" shall mean the party from which indemnification is
sought pursuant to Article VII.
"IP RIGHTS" shall have the meaning set forth in Section 1.1(c).
"KNOWLEDGE" with respect to Seller means knowledge of Balk or any
person who is an officer of employee of Seller on the day prior to the Closing
Date.
"LEGAL REQUIREMENTS" shall have the meaning set forth in Section 3.7.
"LIENS" means any lien, encumbrance, charge, security interest or
adverse claim.
"LOSSES" shall mean all liabilities, obligations, losses, damages,
claims, actions, Liens, deficiencies, costs or expenses (including without
limitation settlement costs and attorneys', accountants' and experts' fees and
court costs and any reasonable cost or expense incurred in enforcing rights
pursuant to this Agreement), less any insurance recoveries in respect thereof.
"NOTE PAYMENTS" shall have the meaning set forth in Section 1.7(b).
"PERSON" means and includes an individual, corporation, partnership
(limited, limited liability or general), joint venture, association, trust, any
other unincorporated organization or entity and a governmental entity or any
department or agency thereto.
"PLANS" shall have the meaning set forth in Section 3.12(a).
"PROCEEDING" shall have the meaning set forth in Section 3.7.
"PROMISSORY NOTE" shall have the meaning set forth in Section 1.7(b).
"RECEIVABLES" shall have the meaning set forth in Section 1.9.
"RETAINED LIABILITIES" shall have the meaning set forth in Section 1.5.
"RFG" means Resource Funding Group, Inc.
"RFG AMOUNT PAYMENT" shall have the meaning set forth in Section
1.7(c).
"RFG RECEIVABLES" shall have the meaning set forth in Section 1.7(c).
"SELLER" shall have the meaning set forth in the heading to this
Agreement.
"SELLER INDEMNIFIED PARTIES" shall have the meaning set forth in
Section 7.3.
1
