Exhibit 2.1
CROSS COUNTRY STAFFING
ASSET PURCHASE AGREEMENT
JUNE 24, 1999
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS..............................................................................................2
1.01 GENERAL..................................................................................2
1.02 DEFINED TERMS............................................................................2
ARTICLE 2
PURCHASE AND SALE.......................................................................................14
2.01 SALE OF ASSETS; RETAINED ASSETS.........................................................14
2.02 ASSUMPTION OF LIABILITIES...............................................................15
2.03 OTHER CONTRACTS.........................................................................15
2.04 NO ENCUMBRANCES.........................................................................15
2.05 CONSIDERATION...........................................................................16
ARTICLE 3
CLOSING.................................................................................................16
3.01 SCHEDULED CLOSING DATE..................................................................16
3.02 TIME AND PLACE OF CLOSING, SIMULTANEITY.................................................16
3.03 ACTIONS AT THE CLOSING..................................................................17
3.04 FURTHER ASSURANCES......................................................................17
ARTICLE 4
POST-CLOSING ADJUSTMENT.................................................................................18
4.01 CLOSING OF BOOKS........................................................................18
4.02 COMPUTATION.............................................................................18
4.03 CLOSING STATEMENT. .....................................................................19
4.04 ACCEPTANCE; NON-ACCEPTANCE; RESOLUTION..................................................19
4.05 POST-CLOSING ADJUSTMENT. ...............................................................21
ARTICLE 5
SELLERS' REPRESENTATIONS AND WARRANTIES.................................................................21
5.01 CORPORATE STATUS AND AUTHORITY, OWNERSHIP, ETC..........................................21
5.02 AUTHORIZATION...........................................................................22
5.03 EXECUTION AND DELIVERY..................................................................22
5.04 NO CONFLICT.............................................................................23
5.05 ASSETS..................................................................................24
5.06 FINANCIAL STATEMENTS....................................................................24
5.07 LITIGATION; INVESTIGATIONS..............................................................26
5.08 ORDINARY COURSE OF BUSINESS.............................................................26
5.09 INSURANCE...............................................................................26
i
5.10 CONTRACTS...............................................................................27
5.11 LABOR AND EMPLOYMENT....................................................................27
5.12 EMPLOYEE BENEFIT PLANS..................................................................28
5.13 INTELLECTUAL PROPERTY...................................................................30
5.14 COMPLIANCE WITH LAWS....................................................................30
5.15 PERMITS.................................................................................30
5.16 TAXES...................................................................................31
5.17 CUSTOMERS...............................................................................32
5.18 YEAR 2000 COMPLIANCE....................................................................32
5.19 ENVIRONMENTAL MATTERS...................................................................32
5.20 QUESTIONABLE PAYMENTS...................................................................32
5.21 INVESTMENT INTENT.......................................................................33
ARTICLE 6
BUYER REPRESENTATIONS AND WARRANTIES....................................................................33
6.01 CORPORATE STATUS AND AUTHORITY..........................................................33
6.02 AUTHORIZATION...........................................................................33
6.03 CAPITALIZATION..........................................................................33
6.04 EXECUTION AND DELIVERY..................................................................34
6.05 NO CONFLICT.............................................................................34
6.06 SUFFICIENT FUNDS........................................................................35
ARTICLE 7
INVESTIGATION, ETC. ....................................................................................35
7.01 INVESTIGATION, ETC......................................................................35
7.02 NO ADDITIONAL REPRESENTATIONS...........................................................36
ARTICLE 8
COVENANTS OF SELLERS AND BUYER..........................................................................36
8.01 ACCESS AND INQUIRY......................................................................36
8.02 BULK TRANSFER...........................................................................36
8.03 XXXX-XXXXX-XXXXXX ACT...................................................................36
8.04 PERMITS.................................................................................37
8.05 NO SOLICITATION, ETC....................................................................37
8.06 MRA SHARES..............................................................................39
8.07 ASSIGNMENT OF NON-COMPETITION AGREEMENTS................................................39
8.08 FULFILLMENT OF CONDITIONS...............................................................39
8.09 NOTICES TO THIRD PARTIES................................................................39
8.10 REASONABLE EFFORTS......................................................................39
ARTICLE 9
CONDUCT OF BUSINESS PRIOR TO THE CLOSING................................................................40
ii
9.01 OPERATION IN ORDINARY COURSE............................................................40
9.02 DISPOSITION OF ASSETS...................................................................40
9.03 ASSUMED CONTRACTS.......................................................................40
9.04 RELATIONS WITH CUSTOMERS AND SUPPLIERS..................................................41
ARTICLE 10
CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS.............................................................41
10.01 ACCURACY OF REPRESENTATIONS AND WARRANTIES..............................................41
10.02 PERFORMANCE OF COVENANTS AND AGREEMENTS.................................................41
10.03 XXXX-XXXXX-XXXXXX ACT...................................................................41
10.04 PERMITS, CONSENTS, ETC..................................................................41
10.05 LITIGATION..............................................................................42
10.06 CERTIFICATES OF SELLERS.................................................................42
10.07 OPINION OF SELLERS' COUNSEL.............................................................43
10.08 MATERIAL ADVERSE CHANGE.................................................................43
10.09 LANDLORD CONSENT/ESTOPPEL LETTERS.......................................................43
ARTICLE 11
CONDITIONS PRECEDENT TO SELLERS' OBLIGATIONS............................................................43
11.01 ACCURACY OF REPRESENTATIONS AND WARRANTIES..............................................43
11.02 PERFORMANCE OF COVENANTS AND AGREEMENTS.................................................43
11.03 XXXX-XXXXX-XXXXXX ACT...................................................................44
11.04 LITIGATION..............................................................................44
11.05 CERTIFICATE OF BUYER....................................................................44
11.06 OPINION OF BUYER'S COUNSEL..............................................................44
ARTICLE 12
EMPLOYEE MATTERS........................................................................................45
12.01 EMPLOYMENT..............................................................................45
12.02 ASSUMED CCS PLANS.......................................................................45
ARTICLE 13
TERMINATION.............................................................................................46
13.01 RIGHTS TO TERMINATE.....................................................................46
13.02 CONSEQUENCES OF TERMINATION.............................................................47
ARTICLE 14
Indemnification.........................................................................................48
14.01 DEFINITIONS.............................................................................48
14.02 SELLERS' INDEMNIFICATION................................................................48
14.03 BUYER'S INDEMNIFICATION.................................................................49
14.04 LIMITATIONS WITH RESPECT TO CERTAIN CLAIMS..............................................50
iii
14.05 DEFENSE OF THIRD PARTY CLAIMS...........................................................51
14.06 PUNITIVE DAMAGES........................................................................54
ARTICLE 15
Cooperation in Various Matters..........................................................................54
15.01 MUTUAL COOPERATION......................................................................54
15.02 PRESERVATION OF SELLERS' FILES AND RECORDS..............................................54
ARTICLE 16
Post-Closing Matters....................................................................................55
16.01 INFORMATION FOR REPORTS.................................................................55
16.02 COVENANT NOT TO COMPETE.................................................................55
16.03 CONFIDENTIALITY AGREEMENTS..............................................................56
16.04 INSURANCE...............................................................................56
16.05 USE OF "CROSS COUNTRY" NAME.............................................................57
ARTICLE 17
Expenses................................................................................................57
17.01 BUYER'S EXPENSES........................................................................57
17.02 SELLERS' EXPENSES.......................................................................57
17.03 TRANSFER TAXES..........................................................................58
ARTICLE 18
Notices.................................................................................................58
18.01 NOTICES.................................................................................58
ARTICLE 19
General.................................................................................................59
19.01 ENTIRE AGREEMENT........................................................................59
19.02 GOVERNING LAW...........................................................................59
19.03 SUBMISSION TO JURISDICTION..............................................................60
19.04 SUCCESSORS AND ASSIGNS..................................................................60
19.05 AMENDMENTS AND WAIVERS..................................................................60
19.06 COUNTERPARTS............................................................................61
19.07 CAPTIONS................................................................................61
iv
CROSS COUNTRY STAFFING
ASSET PURCHASE AGREEMENT
EXHIBITS AND SCHEDULES
EXHIBITS
1A Retained Assets
1B Retained Liabilities
10.07 Opinion of Sellers' Counsel
11.06 Opinion of Buyer's Counsel
SCHEDULES
4.05 Base Working Capital Amount
5.01(a) Qualification
5.04 Conflicts
5.05 Real Property used in Business
5.06(a) Financial Statements
5.06(b) Other Business of CCS Parents
5.06(c) Related Party Transactions
5.07(a) Litigation
5.07(b) Investigations
5.08 Ordinary Course of Business
5.09(a) Insurance Contracts
5.09(b) Notices regarding Insurance Coverage
5.09(c) Insurance Policies of Seller Entities which are Retained Assets
5.10 Contracts
5.11(a) Collective Bargaining, Employment or Consulting Agreements
5.11(b) Labor Matters
5.12(a) Plans
5.12(c) Exceptions to the Plans
5.12(d) Promises to Create Plans
5.13(a) Intellectual Property
5.13(b) Licenses to Third Party to use Intellectual Property
5.13(c) Material Contracts with Third Party for CCS to use Intellectual Property
5.14 Compliance with Laws
5.15 Material Permits
5.16 Taxes
5.17 Customer List
9.01 Operation of Business
10.04(b) Buyer's Closing Conditions: Third Party Consents
v
CROSS COUNTRY STAFFING
ASSET PURCHASE AGREEMENT
CROSS COUNTRY STAFFING ASSET PURCHASE AGREEMENT dated June ___, 1999,
by and among X. X. Xxxxx & Co.- Conn., a Connecticut corporation ("GRACE"),
Cross Country Staffing, a Delaware general partnership ("CCS"), and Cross
Country Holdings, Inc., a Delaware corporation ("BUYER").
WITNESSETH:
WHEREAS, CCS is engaged in the business of recruiting and placing
temporary health care and other professionals (the "BUSINESS");
WHEREAS, a 64% partnership interest in CCS is owned by CCHP, Inc., a
Delaware corporation and an indirect subsidiary of Grace ("CCHP"), and a 36%
partnership interest in CCS is owned by MRA Staffing Systems, Inc., a Delaware
corporation ("MRA"), which will be an indirect wholly-owned subsidiary of Grace
prior to the Closing (as defined); and
WHEREAS, CCS desires to sell to Buyer, and Buyer desires to purchase
from CCS, substantially all of the tangible and intangible assets and business
of CCS, on the terms and conditions and for the consideration provided herein;
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.01 GENERAL. All Article and Section numbers, and Exhibit and
Schedule references used in this Agreement refer to Articles and Sections of
this Agreement, and Exhibits and Schedules attached hereto or delivered
simultaneously herewith, unless otherwise specifically stated. Any of the
terms defined in this Agreement may be used in the singular or the plural. In
this Agreement, unless otherwise specifically stated, "hereof," "herein,"
"hereto," "hereunder" and the like mean and refer to this Agreement as a
whole and not merely to the specific Section, paragraph or clause in which
the word appears; and words importing any gender include the other genders.
1.02 DEFINED TERMS. For purposes of this Agreement, including the
Exhibits and Schedules, the following defined terms have the meanings set
forth in this Section.
"401(k) PLAN" has the meaning given such term in Section 5.12(c).
"ACCOUNT" means the bank account designated by CCS within five days
prior to Closing.
"ACQUISITION PROPOSAL" has the meaning given such term in Section 8.05.
"ADDITIONAL FINANCIAL INFORMATION" has the meaning given such term in
Section 7.01.
"AFFILIATE" of any specified Person at the time at which such status is
being determined, means a Person that at such time, directly or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, the Person specified. "CONTROL" of a specified entity means
the direct or indirect possession of the power to direct or cause the direction
of the management and policies of such entity, whether through the ownership
2
of voting securities, by contract, or otherwise, and in any event shall
include ownership, directly or indirectly through one or more intermediaries,
of voting securities or other equity interests of such entity having a
majority of the voting power of the voting securities or other equity
interests of such entity.
"AGREEMENT" means this Cross Country Staffing Asset Purchase Agreement.
"ASSETS" has the meaning given such term in Section 2.01(a).
"ASSUMED CONTRACTS" has the meaning given such term in Section 2.01(a).
"ASSUMED LIABILITIES" has the meaning given such term in Section 2.02.
"BALANCE SHEET DATE" has the meaning given such term in Section
5.06(c).
"BASE WORKING CAPITAL AMOUNT" means such amount determined in
accordance with SCHEDULE 4.05.
"BREAK UP FEE" has the meaning given such term in Section 13.02(a).
"BUSINESS" has the meaning given such term in the recitals hereto.
"BUSINESS DAY" means a day that is not a Saturday or Sunday, nor a day
on which banks are generally closed in New York City.
"BUYER" means Cross Country Holdings, Inc., a Delaware corporation.
"BUYER ENTITY" means a member of the Buyer Group.
"BUYER GROUP" means, collectively, Buyer and its Affiliates.
"BUYER SHARES" means the shares of Common Stock, par value $.01 per
share, of Buyer.
"BUYERS' CLAIMS" has the meaning given such term in Section 14.04(a).
"BUYER'S EXPENSES" has the meaning given to such term in Section
13.02(a).
3
"CASH PURCHASE PRICE" has the meaning given such term in Section 2.05.
"CCHP" means CCHP, Inc., a Delaware corporation.
"CCS" means Cross Country Staffing, a Delaware general partnership.
"CCS ENTITY" means CCS, CCHP, MRA and each entity (other than Grace
International Holdings, Inc.) which is as of the date hereof or will be as of
the Closing, a direct or indirect subsidiary of Grace and a direct or indirect
shareholder of CCHP or MRA.
"CCS EXECUTIVES" means Xxxxxx Xxxxxxxx, Xxxxxx X. Xxxxxxx, Xxxx Xxxxxx
and Xxxxxxxx Xxxx.
"CCS PARENTS" means all CCS Entities other than CCS.
"CCS PLAN" means any Employee Benefit Plan exclusively maintained,
sponsored or contributed to by CCS or by CCHP, solely for the employees of CCS,
other than the Phantom Equity Program and the Fixed Participation Program.
"CLAIM" has the meaning given such term in Section 14.01.
"CLOSING" means the actions to be taken by the parties described in
Section 3.03.
"CLOSING CURRENT ASSETS" means the aggregate amount, as of the
Valuation Time, of CCS's current assets, computed in accordance with Section
4.02, but excluding those current assets that are Retained Assets.
"CLOSING CURRENT LIABILITIES" means the aggregate amount, as of the
Valuation Time, of CCS's current liabilities, computed in accordance with
Section 4.02, but excluding those current liabilities that are Retained
Liabilities.
"CLOSING DATE" means the date on which the Closing takes place.
"CLOSING STATEMENT" has the meaning given such term in Section 4.03.
4
"CLOSING WORKING CAPITAL AMOUNT" means the amount of the Closing
Current Assets less the amount of the Closing Current Liabilities.
"CODE" means the Internal Revenue Code of 1986, as amended, and any
reference to a particular Code section shall include any revision or successor
to that section regardless of how numbered or classified.
"CONFIDENTIALITY AGREEMENT" means the confidentiality letter agreement
dated January 5, 1999, between CCS and Buyer.
"COVERED PARTIES" has the meaning given such term in Section 8.05.
"CREDIT AGREEMENT" means that Credit Agreement dated July 1, 1996 by
and among CCS, NationsBank, National Association (South) and the other lenders
party thereto.
"CUT-OFF TIME" has the meaning given such term in Section 16.04.
"DAMAGES" has the meaning given such term in Section 14.01.
"DIRECT CLAIMS" has the meaning given such term in Section 14.01.
"DOJ" means the United States Department of Justice.
"EMPLOYEE BENEFIT PLAN" means any written "employee benefit plan" (as
defined under Section 3(3) of ERISA) and any other vacation, bonus, deferred
compensation, pension, retirement, stock purchase, stock appreciation,
severance, or change in control plan or any other employee benefit plan, policy,
arrangement or practice (written or unwritten, insured or uninsured) providing
compensation or benefits to current or former employees, directors or partners
who are individuals.
"ENVIRONMENTAL LAWS" means any federal, state, local or common law,
rule, regulation, ordinance, code, order or judgment (including the common law
and any judicial or
5
administrative interpretations, guidance, directives, policy statements or
opinions) relating to the injury to, or the pollution or protection of human
health and safety or the environment.
"ENVIRONMENTAL LIABILITIES" means any claims, judgments, damages
(including punitive damages), losses, penalties, fines, liabilities,
encumbrances, liens, violations, costs and expenses (including attorneys and
consultants fees) of investigation, assessment, remediation or defense of any
matter relating to human health, safety or the environment of whatever kind or
nature by any Person or governmental entity, (A) which are incurred as a result
of (i) the existence of Hazardous Substances in, on, under, at or emanating from
any real property presently or previously owned or operated by any CCS Entity,
(ii) the offsite transportation, treatment, storage or disposal of Hazardous
Substances generated by any CCS Entity or (iii) the violation of any
Environmental Laws or (B) which arise under the Environmental Laws.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.
"FIELD STAFF" means employees of CCS who work for its clients pursuant
to staffing contracts between CCS and the clients, and other individuals who
staff a client facility under a contract between CCS and such client.
"FINANCIAL STATEMENTS" has the meaning given such term in Section 5.06.
"FTC" means the United States Federal Trade Commission.
"GAAP" means generally accepted accounting principles in the United
States.
"GN" means GN Holdings, Inc., a Delaware corporation (formerly named
CCHP Delaware, Inc.).
6
"GOVERNMENTAL AUTHORITY" means an entity, whether domestic or foreign,
exercising executive, legislative, judicial, regulatory or administrative
functions of government, including, but not limited to, agencies, departments,
boards, commissions, or other instrumentalities.
"GRACE" means X. X. Xxxxx & Co. -Conn., a Connecticut corporation.
"GRACE ENTITY" means a member of the Grace Group.
"GRACE EXECUTIVES" means, collectively, Xxxxx Xxxxxxxxx, Xxxx X.
XxXxxxxxx, Xxxx XxXxxxx and Xxxxx X. Xxxxxxx.
"GRACE GROUP" means, collectively, Grace and its Subsidiaries
(excluding any CCS Entities).
"HAZARDOUS SUBSTANCE" means any substance, compound, chemical or
element which is (a) defined as a hazardous substance, hazardous material, toxic
substance, hazardous waste, pollutant or contaminant under any Environmental
Law, (b) a petroleum hydrocarbon, including crude oil or any fraction thereof,
or (c) regulated pursuant to any Environmental Law.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations thereunder.
"INCOME TAX REGULATIONS" means the rules and regulations promulgated by
the Internal Revenue Service (the "IRS") pursuant to the Code.
"INDEMNITEE" and "INDEMNITOR" have the meanings given such terms in
Section 14.05(a).
"INTELLECTUAL PROPERTY" means Trade Secrets, patents and pending patent
applications, registered and unregistered trademarks, service marks, logos, and
copyrights, trade names and pending registrations and applications to register
or renew the registration of any of the
7
foregoing, technical data, processes, designs (including originals of all
product drawings and product spec sheets), licenses, and other similar
intellectual property rights material to the Business. For purposes of this
definition, the term "Trade Secrets" means any information which (i) is used
in a business, (ii) is not generally known to the public or to Persons who
can obtain economic value from its disclosure, and (iii) is subject to
reasonable efforts to maintain its secrecy or confidentiality; the term may
include but is not limited to inventions, processes, know-how, formulas,
computer programs and backup programs, whether for manufacturing or otherwise
and whether in source code, object code or executable code and mask works
which are not patented and are not protected by registration (E.G., under
copyright or mask work laws); lists of customers, vendors, suppliers, and
employees, and data related thereto; business plans and analyses; and
financial data.
"JOINT VENTURE AGREEMENT" means the Joint Venture Agreement dated May
31, 1996, as amended by the letter agreement dated the same date, between CCHP,
Grace, MRA and Xxxxxx (then named Xxxxxx-BNA plc) providing for the formation of
CCS.
"KNOWLEDGE" means actual knowledge on the date of this Agreement or on
the Closing Date, as applicable, and in the case of the Sellers, their Knowledge
shall mean such knowledge of the Grace Executives after consultation with the
CCS Executives.
"KPMG" means KPMG LLP.
"LEASED REAL PROPERTY" means those parcels of leased real property used
in the business of CCS, excluding leases of living quarters for Field Staff, as
set forth in SCHEDULE 5.05.
8
"LIEN" means any mortgage, pledge, hypothecation, security interest,
agreement to sell, option to buy, right of first refusal, title retention device
or other lien or encumbrance, including any of the foregoing arising under a
deed of trust or indenture.
"LITIGATION EXPENSES" has the meaning given such term in Section 14.01.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on the
business, assets, operations or condition (financial or other) of CCS.
"MATERIAL CONTRACTS" has the meaning given such term in Section 5.10.
"MATERIAL PERMITS" has the meaning given such term in Section 5.15.
"MRA" means MRA Staffing Systems, Inc., a Delaware corporation.
"XXXXXX" means Xxxxxx Healthcare Group plc, an English public limited
liability company (formerly known as Xxxxxx-BNA plc).
"XXXXXX SHAREHOLDERS' APPROVAL" has the meaning given such term in
Section 13.01.
"NOTICE CONDITION" has the meaning given such term in Section 14.05.
"OTHER CONTRACTS" has the meaning given such term in Section 2.03.
"PARTNERSHIP AGREEMENT" means the General Partnership Agreement of
Cross Country Staffing dated May 31, 1996, between CCHP and MRA, as amended by
the letter agreement dated the same date between CCHP, MRA, Grace and Xxxxxx.
"PENDING" has the meaning given such term in Section 5.07.
"PERMITS" has the meaning given such term in Section 5.15.
"PERMITTED LIENS" means (a) Liens for Taxes which are not due and
payable or which may thereafter be paid without penalty, or which are being
contested in good faith by appropriate proceedings; (b) mechanics',
materialmen's, workers', repairmen's,
9
warehousemen's, carriers' and other similar Liens for amounts which are not
yet due and payable, or which may be paid without penalty, or which are being
contested in good faith by appropriate proceedings; and (c) any Liens which
individually or in the aggregate will not have or will not reasonably be
expected to have a Material Adverse Effect.
"PERSON" means any individual, partnership, firm, trust, association,
corporation, joint venture, unincorporated organization, other business entity
or Governmental Authority.
"PLAN" means any Employee Benefit Plan established, maintained,
sponsored, or contributed to by any CCS Entity on behalf of any employee,
director or partner of CCS who is an individual (whether current, former or
retired) or their beneficiaries, with respect to which any CCS Entity has any
current obligation on behalf of such individual.
"PURCHASE PRICE" has the meaning given such term in Section 2.05.
"PwC" means Pricewaterhouse Coopers LLP.
"RETAINED ASSETS" means any CCS Entity's right, title and interest in
(1) cash and cash items, other than deposits with third parties, (2) records
relating solely to any of the Retained Liabilities, (3) Claims related to
Retained Liabilities, including, without limitation, rights to refunds and
credits of all Taxes that fall into the category of Retained Liabilities and (4)
those assets listed in EXHIBIT 1A.
"RETAINED LIABILITIES" means (1) all liabilities and obligations of any
CCS Entity pertaining to all federal, state and local obligations (a) for income
Taxes for any period through and including the Closing Date, (b) under Section
1.1502-6 of the Income Tax Regulations (or any comparable provision of law or
regulation) resulting from the affiliation of any of the CCS Entities with any
other entity during any period through and including the Closing Date, (c) for
10
employment Taxes (including without limitation, withholding Taxes) caused by or
arising from any CCS Entity's practices with regard to meal and incidental
expense payments, lodging allowances or in-kind lodging to the extent that the
employment Tax obligation (i) relates to any period through and including, the
Closing Date or (ii) relates to any period after the Closing Date and results
from meal and incidental expense payments or lodging allowances paid, or in-kind
lodging provided, pursuant to contracts with Field Staff or mobile agreements
entered into on or prior to the Closing (but not including subsequent extensions
or renewals of such contracts) and (d) to make a payment resulting from a
failure to post a bond with respect to any of the obligations set forth in (a),
(b) or (c) above, (2) any liability or obligation of CCS arising out of any
agreement or arrangement with any CCS Parent, Grace or Xxxxxx or any Affiliate
thereof, (3) any liability or obligation under any Employee Benefit Plan (other
than a CCS Plan) of any CCS Entity, Xxxxx, Xxxxxx or any entity, whether or not
incorporated, which is or was part of a controlled group or under common control
with any CCS Entity, Grace or Xxxxxx or otherwise treated as a "single employer"
with any CCS Entity, Grace or Xxxxxx within the meaning of Section 414(b), (c),
(m) or (o) of the Code or under Section 4001 of ERISA with respect to any
Employee Benefit Plan established, maintained, sponsored or contributed to by
any CCS Entity, Grace or Xxxxxx or such entity, including, but not limited to
(i) liabilities for complete and partial withdrawals under any "multiemployer
plan" (as defined in Section 3(37) of ERISA) pursuant to Section 4203 or 4205 of
ERISA, respectively; (ii) liabilities to the Pension Benefit Guaranty
Corporation (including, without limitation, liabilities for premiums and
terminations); (iii) liabilities under Section 4980B of the Code or Part 6 of
Subtitle B of Title I of ERISA; and (iv) liabilities arising under Section 412
of the Code or
11
Section 302(a)(2) of ERISA; (4) any liability or obligation, with respect to
any CCS Plan that is an "employee benefit plan" (as defined by Section 3(3)
of ERISA) that satisfies each of the following two conditions: such liability
or obligation (i) is not incurred under the terms of such Plan (or the terms
of other agreements related to such Plan, including, but not limited to,
agreements or policies between any CCS Entity and an insurance company) and
(ii) arises solely and exclusively as a result of such CCS Plan having been
established, maintained, sponsored or contributed to by an entity that was
part of a controlled group or under common control with Grace or Xxxxxx or by
any entity treated as a "single employer" with Grace or Xxxxxx, within the
meaning of Section 414(b), (c), (m) or (o) of the Code ; (5) any liability or
obligation of CCS under the Joint Venture Agreement, Partnership Agreement,
Shareholders Agreement or Credit Agreement, (6) any liability or obligation
relating to the Retained Assets; and (7) those liabilities listed in EXHIBIT
1B.
"SCHEDULED CLOSING DATE" has the meaning given such term in Section
3.01.
"SECURITIES ACT" has the meaning given such term in Section 5.21.
"SELLERS" means collectively Grace and CCS.
"SHAREHOLDERS AGREEMENT" means the Shareholders Agreement dated July
15, 0000, xxxxxxx XX, XXXX, Xxxxx, and Xxxxxx X. Xxx, Xxxxx X. Xxx, Xxxxx X.
Xxxxx and Xxxxxxxx X. Xxxxx, as amended and supplemented by the Amendment to
Employment Agreement, Shareholders Agreement and Consulting Agreement dated as
of January 15, 1994, between CCHP and Xxxxx X. Xxxxx, CCNU, Inc., AAM, Inc.,
Xxxxxxxx X. Xxxxx, Xxxxxx X. Xxx, Xxxxx X. Xxx, GN and Grace, and the Agreement
dated as of February 9, 0000, xxxxxxx XX, XXXX, Xxxxx, Xxxxxx X. Xxx, Xxxxx X.
Xxx, Xxxxx X. Xxxxx and Xxxxxxxx X. Xxxxx.
12
"SUBSIDIARIES" of a party means any corporation or other organization,
whether incorporated or unincorporated, of which at least a majority of the
securities or interests having power to elect at least a majority of the board
of directors or other Person performing similar functions, or having power to
manage such organization, is directly or indirectly owned or controlled by such
party and/or one or more of its Subsidiaries.
"SUPERIOR PROPOSAL" has the meaning given such term in Section 8.05.
"TAX RETURN" means any return, declaration, report, claim for refund,
or information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"TAXES" means all federal, state, county, local, foreign and other
taxes (including, without limitation, income, profits, premium, estimated,
excise, sales, use, occupancy, gross receipts, franchise, ad valorem, severance,
capital levy, production, transfer, withholding, employment and payroll related
and property taxes, import duties and other governmental charges and
assessments), whether attributable to statutory or nonstatutory rules and
whether or not measured in whole or in part by net income, and including,
without limitation, interest, additions to tax or interest, charges and
penalties with respect thereto.
"THIRD PARTY CLAIMS" has the meaning given such term in Section 14.01.
"TRANSACTION DOCUMENTS" means this Agreement and the transfer and
assumption documents to be executed at or before the Closing pursuant to Section
3.03.
"TRANSFERRED EMPLOYEE" has the meaning given such term in Section
12.01.
"VALUATION TIME" means 11:59 p.m. local time on the day immediately
preceding the Closing Date.
13
ARTICLE 2
PURCHASE AND SALE
2.01 SALE OF ASSETS; RETAINED ASSETS.
(a) On the Closing Date, CCS shall sell, assign, transfer and
deliver to Buyer, and Buyer shall purchase, acquire and accept from CCS, all
right, title and interest of CCS in and to ALL of the assets, rights and
properties of CCS other than the Retained Assets (collectively, the "ASSETS"),
including, without limitation:
(i) all of the machinery, furniture, leasehold
improvements and fixtures, and all other tangible assets owned by CCS
or used in the Business;
(ii) the contracts and agreements of CCS (other than
Other Contracts and contracts which are part of the Retained Assets)
(the "ASSUMED CONTRACTS");
(iii) all of the Intellectual Property of CCS,
including, without limitation, the items set forth on SCHEDULE 5.13(a)
and the name "Cross Country Staffing";
(iv) the books, records and other data relating to
the Business;
(v) all of the accounts receivable of CCS;
(vi) all deposits and prepaid expenses of CCS as
well as CCS's rights under insurance policies covering the Assets or
the Business (other than those rights under insurance policies listed
on SCHEDULE 5.09(c));
(vii) the CCS Plans;
(viii) all right, title and interest of CCS in and to
any and all Permits to the extent transferable or assignable;
14
(ix) all customer and supplier lists and related
information of CCS as well as all existing advertising plans of any
kind, sales literature and related items (including, without
limitation, all art work and printers' plates presently in the
possession of CCS' advertising agencies and printers); and
(x) all of the goodwill and other intangibles
pertaining or relating to the Business.
2.02 ASSUMPTION OF LIABILITIES. At the Closing, Buyer shall assume
all obligations and liabilities of CCS, other than the Retained Liabilities
(the "ASSUMED LIABILITIES"), and no others.
2.03 OTHER CONTRACTS. Anything contained in this Agreement to the
contrary notwithstanding, this Agreement shall not constitute an agreement to
assign or transfer any contract or agreement of CCS or any claim or right to
any benefit arising thereunder, if an attempted assignment or transfer
thereof, without the consent to such assignment or transfer by the other
parties thereto, would constitute a breach thereof (the "OTHER CONTRACTS") .
In each case in which consent of a third party is required for assignment or
transfer of such Other Contract to Buyer, Buyer shall use its reasonable
efforts to obtain, and Sellers agree to cooperate with Buyer in its efforts
to obtain, such consent. If such consent is not obtained, Sellers and Buyer
shall cooperate in any reasonable arrangements designed to provide for Buyer
the benefits and relieve Sellers of the obligations under such Other Contract
including, without limitation, CCS appointing Buyer as its subcontractor with
respect to such Other Contract.
15
2.04 NO ENCUMBRANCES. Seller hereby covenants that the sale,
assignment, transfer and delivery of the Assets hereunder shall be made free
and clear of all Liens, except Permitted Liens (for purposes of this Section
2.04, Permitted Liens shall not include Liens for those Taxes which are
included within the Retained Liabilities).
2.05 CONSIDERATION. In consideration of the aforesaid sale,
assignment, transfer and delivery of the Assets, Buyer shall at the Closing
(i) pay to CCS $183,000,000 (the "CASH PURCHASE PRICE") by wire transfer to
the Account and (ii) issue to CCS 75,396 Buyer Shares (the Cash Purchase
Price, together with the shares in (ii) shall collectively be referred to as
the "PURCHASE PRICE"). The Cash Purchase Price shall be subject to adjustment
as set forth in Article 4. The parties agree that the value of the Buyer
Shares is $6 million and that they will report consistently with such
valuation on all Tax Returns.
2.06 ALLOCATION OF PURCHASE PRICE. Prior to the Closing Date, the
parties hereto shall work together to establish a valuation of Grace's
non-competition agreement set forth in Section 16.02 and those non-competition
agreements assigned to Buyer pursuant to Section 8.07. Buyer shall pay any fees
and expenses of Ernst & Young LLP, retained to assist in establishing a
valuation of the non-competition agreements.
ARTICLE 3
CLOSING
3.01 SCHEDULED CLOSING DATE. The "SCHEDULED CLOSING DATE" shall be
July 30, 1999, or such other day as the parties may agree in an amendment to
this Agreement executed and delivered in accordance with Section 19.05.
16
3.02 TIME AND PLACE OF CLOSING, SIMULTANEITY. Subject to fulfillment
or waiver of the conditions set forth in Articles 10 and 11, the Closing
shall take place at 10:00 a.m. local time on the Scheduled Closing Date at
the offices of Xxxxxxxxx Xxxx XXX, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, or as
the parties otherwise shall mutually agree. All of the actions to be taken
and documents to be executed and delivered at the Closing shall be deemed to
be taken, executed and delivered simultaneously, and no such action,
execution or delivery shall be effective until all actions to be taken and
executions and deliveries to be effected at the Closing are complete.
3.03 ACTIONS AT THE CLOSING. At the Closing, on the terms and
subject to the conditions set forth in this Agreement:
(a) CCS will execute and deliver to Buyer bills of sale,
instruments of assignment and other instruments of transfer
for the Assets, in form reasonably satisfactory to Buyer;
(b) Buyer and each of Sellers will deliver to the other party all
other documents, instruments and writings required to be
delivered at or prior to the Closing Date pursuant to this
Agreement;
(c) Buyer will pay the Cash Purchase Price contemplated by Section
2.05 hereof;
(d) Buyer will deliver to CCS a certificate representing 75,396
Buyer Shares;
(e) Buyer will deliver to CCS an instrument or instruments in form
reasonably satisfactory to CCS by which Buyer shall assume the
Assumed Liabilities; and
(f) Each of Buyer and Sellers will deliver to the other such
certificates, opinions and other documents as are required by
Articles 10 and 11.
17
3.04 FURTHER ASSURANCES. At any time and from time to time after the
Closing, each of Sellers and Buyer shall execute and deliver, and cause to be
executed and delivered, such other agreements, instruments and documents to
effect, confirm or evidence the transactions contemplated by this Agreement
as any other party hereto shall reasonably request consistent with the terms
and conditions of this Agreement, and take, or cause to be taken, all such
other actions, as such other party reasonably deems necessary or desirable to
perfect, confirm or evidence the transactions contemplated by this Agreement.
Each document of transfer or assumption executed and delivered pursuant to
this Agreement shall be reasonably satisfactory in form and substance to
Sellers and Buyer, but shall contain no terms, conditions, representations,
warranties, covenants, agreements or indemnities either not provided by, or
inconsistent with, the terms, conditions, representations, warranties,
covenants, agreements or indemnities contained in this Agreement.
ARTICLE 4
POST-CLOSING ADJUSTMENT
4.01 CLOSING OF BOOKS. Sellers and Buyer shall cooperate to close
the books and related accounting records of CCS as of the Valuation Time.
4.02 COMPUTATION. The Closing Working Capital Amount shall be
determined (in US dollars) on a going concern basis, in accordance with GAAP,
applied on a basis consistent to the Financial Statements for 1998. In
addition, the Closing Working Capital Amount shall be determined using the
same account classifications, closing procedures and time schedules as those
used in the preparation of the Financial Statements for 1998. The
18
parties hereto acknowledge that the use of the closing procedures used in the
Financial Statements for 1998 shall not prevent the Buyer from objecting to
the sufficiency of the amounts of accruals and allowances reported in the
Closing Working Capital Amount.
4.03 CLOSING STATEMENT. Within 60 days following the Closing Date,
Sellers shall deliver to Buyer a statement setting forth their determination
of the Closing Working Capital Amount, together with a report of PwC (the
"CLOSING STATEMENT") stating whether or not the Closing Working Capital
Amount has been determined in accordance with the terms of this Agreement.
Simultaneously with the delivery of the Closing Statement, Sellers shall
deliver to Buyer a statement of the Base Working Capital Amount determined in
accordance with the provisions of SCHEDULE 4.05. Upon and after delivery of
the Closing Statement and the statement of the Base Working Capital Amount,
upon Buyer's request, its independent accountants shall be given access to
PwC's working papers and Grace's working papers to facilitate Buyer's review
of the Closing Statement and the statement of the Base Working Capital
Amount, respectively.
4.04 ACCEPTANCE; NON-ACCEPTANCE; RESOLUTION.
(a) Buyer shall have 30 days after receipt of the Closing
Statement and the statement of the Base Working Capital Amount to advise Sellers
that Buyer disputes either of the working capital amounts. If Buyer fails to
provide such notice (which shall describe in reasonable detail the basis of the
objection and Buyer's proposed adjustments), then the Closing Working Capital
Amount shown on the Closing Statement and the Base Working Capital Amount shall
be final and binding on Sellers and Buyer. If Buyer provides notice that it
disputes either of the working capital amounts within such 30-day period, Buyer
and Sellers
19
shall promptly endeavor to resolve such dispute through negotiation. If
written agreement settling all disputes has not been reached through
negotiation within 45 days after receipt by Sellers of Buyer's notice of
dispute, then either Sellers or Buyer may, by notice to the other, submit the
dispute for determination by binding arbitration to KPMG, which shall have
sole and absolute discretion with respect to the resolution of such dispute
(subject to the provisions of Section 4.04(c)). KPMG shall settle any
disputes regarding either the Closing Working Capital Amount or the Base
Working Capital Amount separately. The working capital amounts, as modified
by KPMG, shall be final and binding upon the parties, and shall constitute
the final working capital amounts.
(b) The fees and expenses of KPMG for any determination of the
Closing Working Capital Amount shall be shared as follows: Sellers shall bear
that portion thereof equal to the total amount of such fees and expenses
multiplied by a fraction, the denominator of which shall be the difference
between the Closing Working Capital Amount as finally proposed by Buyer and the
Closing Working Capital Amount as finally proposed by Sellers, and the numerator
of which shall be the difference between the Closing Working Capital Amount as
determined by KPMG and the Closing Working Capital Amount as proposed by
Sellers. Buyer shall bear the remainder of such fees and expenses. Buyer and
Sellers (treating the Sellers as a single entity for this purpose) each shall
pay 50% of the fees and expenses of KPMG for any determination of the Base
Working Capital Amount.
(c) KPMG shall not be authorized or permitted to (i) determine
any question or matter whatsoever under or in connection with this Agreement,
except the determination of what adjustments, if any, must be made to one or
more of the items reflected in the
20
calculation of the Closing Working Capital Amount, (ii) modify the methods
set forth in SCHEDULE 4.05 to calculate the Base Working Capital Amount, or
(iii) determine working capital amounts that are not in the range between and
including the final proposals of Sellers and Buyer. Nothing herein shall be
construed to require KPMG to follow any rules or procedures of any
arbitration association.
4.05 POST-CLOSING ADJUSTMENT.
The Cash Purchase Price shall be increased by the amount, if
any, by which the finally determined Closing Working Capital Amount exceeds the
finally determined Base Working Capital Amount. The Cash Purchase Price shall be
decreased by an amount, if any, by which the finally determined Closing Working
Capital Amount is less than the finally determined Base Working Capital Amount.
Such adjusting payment shall be made not later than 15 calendar days after the
final determination of the working capital amounts. If the net amount of the
adjusting payment exceeds $100,000, interest shall accrue on the entire amount
of the net adjusting payment, from the Closing Date to the date of payment, at a
floating rate equal to the U.S. prime rate in effect from time to time during
the period from the Closing Date until the date of payment in full, as reported
by the Eastern Edition of THE WALL STREET JOURNAL.
21
ARTICLE 5
SELLERS' REPRESENTATIONS AND WARRANTIES
Sellers jointly and severally represent and warrant to Buyer as
follows:
5.01 CORPORATE STATUS AND AUTHORITY, OWNERSHIP, ETC.
22
(a) STATUS AND AUTHORITY. CCS is a general partnership duly
formed and existing under the laws of the State of Delaware with full
partnership power and authority to own the Assets and to carry on the Business.
CCS is licensed or qualified to transact business and is in good standing as a
foreign entity in each jurisdiction set forth in SCHEDULE 5.01(a). Each of the
Sellers has all requisite power and authority to execute, deliver and perform
its obligations under this Agreement and the Transaction Documents to which it
is or will be a party. A true, correct and complete copy of the Partnership
Agreement has been made available to Buyer; such Partnership Agreement is in
full force and effect and has not been amended either orally or in writing since
the date thereof.
(b) CCS, CCHP AND MRA OWNERSHIP. CCHP is the owner of a 64%
partnership interest in CCS and MRA is the owner of a 36% partnership interest
in CCS. Grace indirectly owns at least 90% of the outstanding capital stock of
CCHP and, on the Closing, will own, directly or indirectly, all of the
outstanding capital stock of MRA. CCS owns no equity security or any other
equity interest of any Person.
5.02 AUTHORIZATION. The execution and delivery by each of the
Sellers of this Agreement and the Transaction Documents to which it is or
will be a party, and its performance of its obligations hereunder and
thereunder have been duly authorized by all required partnership action, in
the case of CCS, or corporate action, in the case of Grace. No vote of the
stockholders of Grace or GN is required for the execution, delivery and
performance by the Sellers of this Agreement.
5.03 EXECUTION AND DELIVERY. Each of the Sellers has duly and
validly executed and delivered this Agreement and the Transaction Documents
to which it is a party and which
23
are being executed and delivered simultaneously with this Agreement; and this
Agreement and such Transaction Documents are valid and binding obligations of
such Seller, enforceable against such Seller in accordance with their
respective terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and general
principles of equity (whether or not considered in a proceeding at law or in
equity). The remaining Transaction Documents to which a Seller will be a
party, when executed and delivered at the Closing, will be duly and validly
executed and delivered by such Seller, and upon such execution and delivery,
will be valid and binding obligations of such Seller enforceable against such
Seller in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and general principles of equity (whether or not
considered in a proceeding at law or in equity).
5.04 NO CONFLICT. Except as otherwise disclosed in SCHEDULE 5.04,
the execution and delivery by each of the Sellers of this Agreement and the
Transaction Documents to which it is or will be a party, and its performance
of its obligations hereunder and thereunder, does not and will not: (i)
violate any provision of the certificate of incorporation or by-laws of Grace
or the Partnership Agreement; (ii) violate, result in a breach of or
constitute a default (or an event which, with or without notice, lapse of
time or both, would constitute a default) under or result in the invalidity
of, or accelerate the performance required by or cause or give rise to any
right of acceleration or termination of any right or obligation pursuant to
any material agreement or contract to which either of the Sellers or any CCS
Entity is a party or by which any of
24
them (or any of their respective assets) is subject or bound; (iii) violate,
or result in the creation of, or give any party the right to create, any Lien
upon any of the Assets; (iv) violate, result in a breach of or constitute a
default (or an event which, with or without notice, lapse of time or both,
would constitute a default) under any judgment, decree, order or process of
any court or Governmental Authority binding upon either of the Sellers, or
any of their respective businesses or properties, including the Assets; (v)
violate any statute, law or regulation applicable to either of the Sellers,
or any of their respective businesses or properties, including the Assets;
(vi) terminate or modify, or give any third party the right to terminate or
modify, the provisions or terms of any Assumed Contract; or (vii) require
either of the Sellers to obtain any authorization, consent, approval or
waiver from, or to make any filing with, any Person (other than those
obtained by Sellers prior to the Closing, which are in full force and effect
at the Closing), except for such violations, breaches, defaults, Liens,
modifications, terminations or failures to obtain consents which would not
reasonably be expected to have a Material Adverse Effect.
5.05 ASSETS.
SCHEDULE 5.05 sets forth a description of the Leased Real
Property, and any rights of third parties to occupy space at the leased
premises. CCS enjoys peaceful possession of all such property. Except as
specified in SCHEDULE 5.05 and except for leases of living quarters for Field
Staff, no real property is used in the Business. CCS does not own any real
property.
25
5.06 FINANCIAL STATEMENTS.
(a) SCHEDULE 5.06(a) contains the balance sheet and related
statements of income and partners' capital and of cash flows of CCS at and for
the years ended December 31, 1998 and 1997, which have been audited and reported
upon by PwC (collectively, the "FINANCIAL STATEMENTS"). The Financial Statements
present fairly, in all material respects, the financial position of CCS at their
respective dates, and the result of its operation and its cash flows for the
years covered thereby, in conformity with GAAP consistently applied. Revenues of
not less than $58,800,000 have been earned, fairly stated and recorded by CCS
for the four-month period ended April 30, 1999, consistent with past practice
and CCS's policies with respect to revenue recognition.
(b) Except as set forth in SCHEDULE 5.06(b), no Seller nor any
officer, director or Affiliate of any Seller or any CCS Entity owns any
controlling interest in any corporation, partnership, firm, association or
business organization, entity or enterprise, which is a competitor, supplier or
customer of CCS and which relationship is material to the Business; owns, in
whole or in part, any property, asset or right used in connection with, and is
material to, the Business; has an interest in any Material Contract; or has any
contractual arrangements with CCS which are Material Contracts. Without limiting
the foregoing, SCHEDULE 5.06(c) sets forth all contracts, licenses, agreements,
commitments or other arrangements between any CCS Parent, member of the Grace
Group and CCS, whether written or oral, and whether express or implied, pursuant
to which such entity provides management, administrative, legal, financial,
accounting, data processing, insurance, technical support, or other services to
CCS which are material to the Business, or the use by CCS of any assets of such
entity, or pursuant
26
to which rights, privileges or benefits are accorded to CCS which are
material to the Business.
(c) Except for the Retained Liabilities, CCS has no
liabilities or obligations of any nature, whether absolute, accrued, contingent
or otherwise, except for (i) liabilities included or reflected in the Financial
Statements; (ii) liabilities disclosed in the Schedules to this Agreement; (iii)
liabilities incurred in the ordinary course of business subsequent to December
31, 1998 (the "BALANCE SHEET DATE"); or (iv) liabilities or performance
obligations arising in the ordinary course of business (and not as a result of a
breach or default by CCS) out of or under agreements, contracts, leases,
arrangements or commitments to which CCS is a party. Sellers have no Knowledge
of any basis for the assertion against CCS of any such liability.
5.07 LITIGATION; INVESTIGATIONS.
(a) Except as set forth in SCHEDULE 5.07(a) AND EXCEPT WITH
RESPECT TO RETAINED LIABILITIES, there are no actions, suits or proceedings
Pending (which shall be defined as service of a written summons or complaint on
the Person in question) or, to the Knowledge of Sellers, threatened against CCS,
the CCS Parents, Sellers or the Plans (other than non-material notice claims for
benefits, and appeals of such claims), any trustee or fiduciary of the Plans or
any assets of any trust of the Plans which would reasonably be expected to have
a Material Adverse Effect.
(b) Except as set forth in the SCHEDULE 5.07(b) AND EXCEPT
WITH RESPECT TO RETAINED LIABILITIES, there are no Pending or, to the Knowledge
of Sellers, threatened
27
governmental investigations of CCS, the CCS Parents, the Business, or the
Plans which would reasonably be expected to have a Material Adverse Effect.
5.08 ORDINARY COURSE OF BUSINESS. Except as set forth in SCHEDULE
5.08 and except for such actions which would not reasonably be expected to
have a Material Adverse Effect, since the Balance Sheet Date the Business has
been conducted only in the ordinary and usual course consistent with past
practice.
5.09 INSURANCE. SCHEDULE 5.09(a) describes the insurance coverage
maintained by or on behalf of CCS, the Business or the Assets. Except as set
forth on SCHEDULE 5.09(b), no member of the Grace Group or any CCS Entity has
received any written notice from, or on behalf of, any insurance carrier
issuing to it those insurance policies which are among the Assumed Contracts
to the effect that: (a) insurance rates will hereafter be substantially
increased; (b) there will hereafter be no renewal of existing policies; or
(c) material modification of any aspect of the Business will be required.
5.10 CONTRACTS. SCHEDULE 5.10 lists all the contracts and agreements of
CCS that (i) (A) have a term of one year or more, (B) cannot be canceled by CCS
without penalty upon notice of one year or less and (C) under which CCS may
reasonably be expected to make expenditures or obtain receipts of $100,000 or
more or (ii) could reasonably be expected to impose a material restriction on
the conduct of the business of CCS (the agreements described in (i) and (ii)
above shall collectively be referred to as the "MATERIAL CONTRACTS"). CCS
heretofore has delivered or made available to Buyer complete copies of all such
Material Contracts as currently in effect. Each Material Contract is valid and
in full force and effect, and CCS is not in default thereunder.
28
5.11 LABOR AND EMPLOYMENT. SCHEDULE 5.11(a) lists each collective
bargaining agreement between CCS and a labor union or similar organization
covering any employee of any CCS Entity and each individual employment or
consulting agreement that will remain in effect after the Closing covering any
employee or consultant of a CCS Entity. Except as set forth in SCHEDULE 5.11(b),
there is no labor strike, dispute, slowdown or stoppage actually Pending,
threatened against or affecting any CCS Entity which may have a Material Adverse
Effect; no CCS Entity has, during the twelve (12) month period prior to the date
hereof, experienced any work stoppage or other labor dispute which may have a
Material Adverse Effect.
5.12 EMPLOYEE BENEFIT PLANS.
(a) Except as set forth in SCHEDULE 5.12(a), there are no
Plans, individually, that are expected to have liabilities in excess of $100,000
annually. With respect to each Plan, as applicable, accurate and complete (i)
copies of each written Plan (including all amendments thereto), (ii) copies of
related trust or funding agreements, (iii) copies of written summary plan
descriptions, (iv) copies of written summaries of material modifications, (v)
copies of the most recent annual reports and financial statements, (vi) copies
of the most recent determination letter from the IRS for each Plan intended to
qualify under Code Section 401(a) and (vii) written summary descriptions of each
unwritten Plan set forth in SCHEDULE 5.12(a), have been heretofore delivered or
made available to Buyer.
(b) No CCS Entity nor any of their respective predecessors,
has ever contributed to, contributes to, or has ever been required to contribute
to, any plan subject to Section 412 of the Code, Section 302 of ERISA or Title
IV of ERISA, including, without
29
limitation, any "multiemployer plan" (within the meaning of Sections (3)(37)
or 4001(a)(3) of ERISA or Section 414(f) of the Code), or any single employer
pension plan (within the meaning of Section 4001(a)(15) of ERISA) which is
subject to Sections 4063 and 4064 of ERISA.
(c) With respect to each of the Plans on SCHEDULE 5.12(a),
except as set forth on SCHEDULE 5.12(c) (i) all payments required to be made
prior to Closing by any Plan with respect to all periods through the date of the
Closing shall have been made; (ii) each Plan in form and in operation complies
in all material respects with applicable law, including, without limitation,
ERISA and the Code; (iii) no "prohibited transaction," within the meaning of
Section 4975 of the Code and Section 406 of ERISA which would reasonably be
expected to have a Material Adverse Effect, has occurred with respect to the
Plan (and the consummation of the transactions contemplated by this Agreement
will not constitute or directly or indirectly result in such a "prohibited
transaction"); and (iv) with respect to each Plan that is funded mostly or
partially through an insurance policy, no CCS Entity has any liability in the
nature of retroactive rate adjustment or loss sharing arrangement. The CCHP
401(k) Plan (the "401(k) PLAN") is the only CCS Plan intended to qualify under
Section 401(a) of the Code. The 401(k) Plan is a prototype plan. Nothing has
occurred since the inception of the 401(k) Plan, or is expected to occur through
the Closing Date, that would reasonably be expected to cause the loss of the
401(k) Plan's status as a plan qualified under Section 401 (a) of the Code. The
IRS has issued to the 401(k) Plan's prototype sponsor a favorable determination
letter that has been delivered to the Buyer.
30
(d) The consummation of the transactions specified in this
Agreement will not give rise to any liability for severance pay, unemployment
compensation, termination pay, or withdrawal liability, or accelerate the
time of payment or vesting or increase the amount of compensation or benefits
due to any employee, director or shareholder of any CCS Entity (whether
current, former, or retired) or their beneficiaries under any Plan listed in
SCHEDULE 5.12(a) solely by reason of such transactions. No CCS Entity
maintains, contributes to, or in any way provides for any benefits of any
kind whatsoever under an "employee welfare benefit plan" (as defined under
Section 3(1) of ERISA) to any current or future retiree or terminee, other
than under Section 4980B of the Code. Except as set forth in SCHEDULE
5.12(d), no authorized officer, director, partner or employee of Xxxxx,
Xxxxxx or any CCS Entity has made any promises or commitments to create any
additional plan, agreement, or arrangement, or to modify or change any
existing Plan listed on SCHEDULE 5.12(a) that would materially increase the
liabilities associated with such Plan. Except for the provisions of
applicable law (including, without limitation, applicable contract law), no
event, condition, or circumstance exists that would prevent the amendment or
termination of any Plan set forth in SCHEDULE 5.12(a).
5.13 INTELLECTUAL PROPERTY. SCHEDULE 5.13(a) sets forth a list of all
patents and patent applications, registered trademarks and trademark
applications, registered service marks and service xxxx applications and
copyrights and copyright applications owned by CCS and used directly and
primarily in the Business. Except as set forth in SCHEDULE 5.13(b), CCS has not
granted any third party any license to use any of such items. The Intellectual
Property included in the Assets is the only Intellectual Property used directly
and
31
primarily in the Business except for such Intellectual Property, the failure
of which to be included in the Assets would not have a Material Adverse
Effect. SCHEDULE 5.13(c) lists all Material Contracts under which CCS has a
license from an unaffiliated Person to use the Intellectual Property in the
Business. CCS heretofore has delivered or made available to Buyer complete
copies of such Material Contracts as currently in effect.
5.14 COMPLIANCE WITH LAWS. Except as set forth in SCHEDULE 5.14, CCS,
the CCS Parents and the Plans are in compliance with all federal, state, county,
local or foreign laws, statutes, ordinances, rules and regulations, the failure
to be in compliance with which would reasonably be expected to have a Material
Adverse Effect.
5.15 PERMITS. CCS has duly obtained all permits, concessions, grants,
franchises, licenses and other governmental authorizations and approvals
(collectively, "PERMITS") necessary for the conduct of the Business, except for
such Permits the failure of which to have obtained would not reasonably be
expected to have a Material Adverse Effect (the "MATERIAL PERMITS"); each of the
Material Permits is listed in SCHEDULE 5.15 and is in full force and effect;
there are no proceedings Pending or, to the Knowledge of Sellers, threatened
which may result in the revocation, cancellation, suspension or modification of
any Material Permit.
5.16 TAXES. Except with respect to Taxes which are included within the
Retained Liabilities and except as set forth in SCHEDULE 5.16: (a) each CCS
Entity has filed (or had filed on its behalf) with appropriate tax authorities
all Tax Returns required to be filed by it and has paid (or had paid on its
behalf) all Taxes due for all periods ending on or prior to the Closing Date;
(b) all amounts required to be withheld or collected by any CCS Entity from
customers or from or on behalf of employees for income, social security and
unemployment
32
insurance Taxes have been collected or withheld and either paid to the
appropriate governmental agency or set aside and, to the extent required by
law, held in accounts for such purpose; (c) there are no Pending or
threatened actions or proceedings by any applicable taxing authority for the
assessment, collection, adjustment or deficiency of Taxes against any CCS
Entity and there are no Pending or threatened Tax audits of any CCS Entity;
(d) there are no outstanding agreements or waivers extending the statutory
period of limitation applicable to any assessment of Tax or audit of any Tax
Return of any CCS Entity for any period; and (e) no CCS Entity is a party to
any agreement, contract, arrangement or plan that as a result of the
transactions contemplated by this Agreement would result, separately or in
the aggregate, in the payment on behalf of any CCS Entity of any "excess
parachute payments" within the meaning of Section 280G of the Code.
5.17 CUSTOMERS. Set forth in SCHEDULE 5.17 is a true and complete list
of the top two and fourth through tenth largest customers of CCS in order of
dollar amount of revenues during the last two fiscal years and for the period
from the end of the last fiscal year through April 30, 1999, showing the total
revenues in dollars from each such customer during each such period.
5.18 YEAR 2000 COMPLIANCE. Based on representations and warranties made
by vendors to the CCS Entities, the computer systems (including all work
stations and other components) of CCS are year 2000 compliant, except for such
failures to be so compliant which would not reasonably be expected to have a
Material Adverse Effect.
5.19 ENVIRONMENTAL MATTERS. All the operations of CCS comply and have
at all times complied with all applicable Environmental Laws and CCS has not
incurred any
33
Environmental Liabilities, except as, singularly or in the aggregate, would
not have a Material Adverse Effect.
5.20 QUESTIONABLE PAYMENTS. No CCS Entity or any director, officer,
agent, employee, or any other Person acting on behalf of a CCS Entity has,
directly or indirectly, used any corporate funds for unlawful contributions,
gifts, entertainment, or other unlawful expenses; made any unlawful payment
to government officials or employees or to political parties or campaigns;
established or maintained any unlawful fund of corporate monies or other
assets; made or received any bribe, or any unlawful rebate, payoff, influence
payment, kickback or other payment; given any favor or gift which is not
deductible for federal income tax purposes; or made any bribe, kickback, or
other payment of a similar or comparable nature, to any governmental or
non-governmental Person, regardless of form, whether in money, property, or
services, to obtain favorable treatment in securing business or to obtain
special concessions, or to pay for favorable treatment for business or for
special concessions secured, which such acts as described above, if
discovered, would reasonably be expected to have a Material Adverse Effect.
5.21 INVESTMENT INTENT. CCS represents that it is acquiring the Buyer
Shares for investment purposes and not with a view to the distribution thereof,
provided that the disposition of its property shall at all times be within its
control. Sellers acknowledge that the Buyer Shares have not been registered
under the Securities Act of 1933, as amended (the "SECURITIES ACT") and may be
resold only if registered pursuant to the provisions of the Securities Act or if
an exemption from registration is available, except under circumstances where
neither such registration nor such an exemption is required by law.
34
ARTICLE 6
BUYER REPRESENTATIONS AND WARRANTIES
Buyer represents and warrants to Sellers as follows:
6.01 CORPORATE STATUS AND AUTHORITY. Buyer is a corporation duly
organized and validly existing under the laws of Delaware. Buyer has full
corporate power to enter into this Agreement and the Transaction Documents to
which it is or will be a party and perform its obligations hereunder and
thereunder.
6.02 AUTHORIZATION. The execution and delivery by Buyer of this
Agreement and the Transaction Documents to which it is or will be a party,
and its performance of its obligations hereunder and thereunder, have been
duly authorized by all required corporate action (including stockholder
action).
6.03 CAPITALIZATION. As of the date hereof, the authorized capital
stock of Buyer consists of 2,000,000 Buyer Shares, of which, as of the
Closing 1,000,000 shares (which includes those shares issued to CCS) will be
issued and outstanding. Upon issuance of the Buyer Shares to CCS in
connection with this Agreement, such Buyer Shares shall be validly issued and
outstanding, fully paid and nonassessable, free of preemptive rights, and
free and clear of all Liens, except for Liens resulting from actions of or on
behalf of Sellers.
6.04 EXECUTION AND DELIVERY. Buyer has duly and validly executed and
delivered this Agreement and the Transaction Documents to which it is a party
and which are being executed and delivered simultaneously with this
Agreement; and, this Agreement and such Transaction Documents are valid and
binding obligations of Buyer, enforceable against Buyer in accordance with
their respective terms, except as such enforceability may be limited by
35
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally and
general principles of equity (whether or not considered on a proceeding at
law or in equity). The remaining Transaction Documents to which Buyer will be
a party, when executed and delivered at the Closing, will be duly and validly
executed and delivered by Buyer, and upon such execution and delivery, will
be valid and binding obligations of Buyer, enforceable against Buyer in
accordance with their respective terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally
and general principles of equity (whether or not considered on a proceeding
at law or in equity).
6.05 NO CONFLICT. The execution and delivery by Buyer of this
Agreement and the Transaction Documents to which it is or will be a party,
and its performance of its obligations hereunder and thereunder, does not and
will not (a) conflict with its certificate of incorporation or by-laws; or
(b) result in a breach of any of the provisions of, or constitute a default
under, any judgment, order, decree, or agreement to which Buyer is bound,
which breach or default would prevent Buyer from executing and delivering
this Agreement or any Transaction Document to which it is or will be a party
or performing its obligations hereunder or thereunder.
6.06 SUFFICIENT FUNDS. Buyer will have on the Scheduled Closing Date
sufficient funds to consummate the transactions contemplated by this
Agreement to be performed by Buyer.
36
ARTICLE 7
INVESTIGATION, ETC.
7.01 INVESTIGATION, ETC. Buyer hereby acknowledges the following:
(a) Buyer has conducted its own investigation and has made its
own evaluation of the CCS Entities and the Business, Assets and Assumed
Liabilities. The scope of such investigation has been determined by Buyer. No
such investigation shall limit any representation or warranty of Sellers
contained herein.
(b) As part of its investigation, Buyer is being given certain
forecasts, projections and opinions prepared or furnished by or on behalf of
Sellers with respect to the Business (the "ADDITIONAL FINANCIAL INFORMATION").
Buyer has taken responsibility for evaluating the adequacy of the Additional
Financial Information. There are uncertainties inherent in attempting to make
projections and forecasts and formulate opinions; Buyer is familiar with such
uncertainties, and has taken such uncertainties into account in its evaluation
of the Additional Financial Information. Except for the representations and
warranties contained in Article 5 of this Agreement, neither of Sellers nor any
of their respective Affiliates shall have any liability of any kind to Buyer or
any other Buyer Entity, with respect to any of the Additional Financial
Information.
7.02 NO ADDITIONAL REPRESENTATIONS. (a) Buyer hereby acknowledges
that, except for the representations and warranties contained in Article 5 of
this Agreement, no Seller nor any of its Affiliates is making any
representation or warranty, express or implied, of any nature whatsoever with
respect to the Business, Assets and Assumed Liabilities.
37
(b) Sellers hereby acknowledge that, except for the
representations and warranties contained in Article 6 of this Agreement, neither
Buyer nor any of its Affiliates is making any representation or warranty,
express or implied, of any nature whatsoever, in connection with the
transactions contemplated hereby.
ARTICLE 8
COVENANTS OF SELLERS AND BUYER
8.01 ACCESS AND INQUIRY. Between the date of this Agreement and the
Closing, Sellers shall give Buyer reasonable access to the facilities of the
CCS Group and Buyer will be permitted to contact and make reasonable inquiry
of employees and customers of CCS regarding the Business, Assets and Assumed
Liabilities. Sellers shall make available to Buyer all books, records, and
other financial data and files of the CCS Entities. Buyer acknowledges that
the terms of the Confidentiality Agreement shall apply to information
obtained pursuant to this Section.
8.02 BULK TRANSFER. The parties agree to waive compliance with any
bulk transfer law applicable to any of the transactions contemplated hereby.
8.03 XXXX-XXXXX-XXXXXX ACT. As soon as practicable after the date
hereof, Sellers and Buyer will file or cause to be filed appropriate
Notification and Report Forms under the HSR Act. Sellers and Buyer shall
cooperate to coordinate such filings, and to make reasonable efforts to
respond to any governmental request or inquiry with respect thereto.
8.04 PERMITS. As soon as reasonably practicable after the date
hereof, Buyer shall prepare and file or cause to be prepared and filed with
the appropriate licensing and permitting authorities applications for the
issuance to Buyer of all those Material Permits on
38
SCHEDULE 5.15 that are not assignable or will be revoked, canceled, suspended
or modified as a result of the transactions contemplated by this Agreement.
Buyer shall use all reasonable efforts to secure such Material Permits.
Sellers shall use all reasonable efforts requested by Buyer to assist Buyer
in the preparation of such applications and the securing of such Material
Permits.
8.05 NO SOLICITATION, ETC. Sellers and the Covered Parties (as
defined in the following sentence) shall immediately cease and terminate any
existing solicitation, initiation, encouragement, activity, discussion or
negotiation with any parties conducted heretofore by Sellers or the Covered
Parties with respect to an Acquisition Proposal (as defined herein). From the
date hereof, Sellers shall not, and shall not permit any of their respective
Affiliates (including X.X. Xxxxx & Co.) or any of the CCS Entities or any
officer, director, employee or representative of any of them (collectively,
the "COVERED PARTIES"), to directly or indirectly, solicit or initiate any
inquiries or the making of any proposal which constitutes or may reasonably
be expected to lead to an Acquisition Proposal from any Person, or engage in
any discussion or negotiations relating thereto or accept any Acquisition
Proposal; provided, however, that notwithstanding the foregoing, Sellers may
at any time prior to the Closing: (i) engage in discussions or negotiations
with a third party who (without any solicitation or initiation, directly or
indirectly, by any of the Sellers or the Covered Parties after the date
hereof) seeks to initiate such discussions or negotiations and may furnish
such third party information concerning CCS and its business if (A) the third
party has first made an unsolicited bona fide written Acquisition Proposal
(so long as such proposal did not result from a breach of this Section 8.05)
and Grace determines in good faith that to do so has a
39
reasonable prospect of leading to an Acquisition Proposal that is superior to
the transaction contemplated by this Agreement (taking into account all
legal, financial and regulatory aspects of the proposal and the Person making
such proposal), has a reasonable likelihood of being consummated and for
which financing for the Acquisition Proposal has a reasonable prospect to be
obtained (any such more favorable proposal, a "SUPERIOR PROPOSAL") and (B)
prior to furnishing such information to or entering into discussions or
negotiations with such Person, Grace (x) provides prompt notice to Buyer to
the effect that it is planning to furnish information to or enter into
discussions or negotiations with such Person and (y) receives or shall have
received from such Person an executed confidentiality agreement or (ii)
accept a Superior Proposal from a third party, provided Grace concurrently
terminates this Agreement pursuant to Section 13.01(c) and immediately pays
the Break-Up Fee set forth in Section 13.02(a). Sellers and the Covered
Parties shall notify Buyer orally of the terms and conditions of any Superior
Proposals and the identity of the Person making it within 24 hours of the
receipt thereof. As used herein, "ACQUISITION PROPOSAL" shall mean a proposal
to offer (other than by a member of the Buyer Group) to acquire by merger,
reorganization, consolidation, purchase or otherwise any equity securities
of, or partnership interest in, any CCS Entity or 15% or more of the assets
of any CCS Entity.
8.06 MRA SHARES. Grace shall acquire, directly or indirectly, from
Xxxxxx prior to Closing all of the outstanding capital stock of MRA (or such
other entity as may be the partner of CCS); provided, however, that this
Section shall be deemed void AB INITIO if this Agreement is terminated
pursuant to Section 13.01 or because the conditions set forth in Article 11
shall not have been satisfied.
40
8.07 ASSIGNMENT OF NON-COMPETITION AGREEMENTS. Effective as of the
Closing, each member of the Grace Group hereby assigns to Buyer all its
rights under all non-competition agreements with respect to the Business to
which it is a party. Each member of the Grace Group covenants that it shall
not terminate or modify, or agree to terminate or modify, such agreements.
8.08 FULFILLMENT OF CONDITIONS. Buyer and Sellers shall use their
reasonable efforts to cause the conditions to Closing set forth in Articles
10 and 11 to be fulfilled in a timely manner.
8.09 NOTICES TO THIRD PARTIES. Buyer and Sellers shall cooperate to
make all other filings and to give notice to all third parties that may
reasonably be required to consummate the transactions contemplated by this
Agreement.
8.10 REASONABLE EFFORTS. In using reasonable efforts under Sections
8.03, 8.04, and 8.08, neither Grace, CCS, Buyer nor their respective Affiliates
shall be required to make any payment (other than for reasonable legal fees)
that it is not presently legally or contractually required to make, divest any
assets (including but not limited to the Assets), make any change in the conduct
of its business, accept any limitation on the future conduct of its business,
enter into any other agreement or arrangement with any Person that it is not
presently contractually required to enter into, accept any significant
modification in any existing agreement or arrangement, or agree to any of the
foregoing.
8.11 LETTER REGARDING CONDITIONS. At the opening of business on the day
before the Closing Date, Buyer shall provide Sellers with a letter (a) stating
that as of that time, all the conditions set forth in Article 10 (other than the
conditions in Sections 10.06 and 10.07) have
41
been satisfied, and that the forms of certificates and opinion required by
Sections 10.06 and 10.07 are acceptable, or (b) specifying the conditions set
forth in Article 10 that have not been satisfied. If, during the period from
and after the delivery of such letter, Buyer determines that any condition
set forth in Article 10 is no longer satisfied, Buyer shall not be obligated
to cause the Closing to occur and shall have no liability to Sellers as a
result of Buyer's delivery of such letter.
ARTICLE 9
CONDUCT OF BUSINESS PRIOR TO THE CLOSING
Sellers agree that except as otherwise contemplated by this Agreement
or consented to by Buyer, from the date of this Agreement until the Closing:
9.01 OPERATION IN ORDINARY COURSE. Except as set forth in SCHEDULE
9.01, the Business shall be conducted only in the ordinary course and
consistent with past practice.
9.02 DISPOSITION OF ASSETS. CCS shall not sell, lease (as lessor),
transfer, license (as licensor), or otherwise dispose of, any of the Assets
except the Retained Assets, other than in the ordinary course of business.
9.03 ASSUMED CONTRACTS. CCS shall not terminate or enter into any
Material Contract.
9.04 RELATIONS WITH CUSTOMERS AND SUPPLIERS. CCS shall use all
reasonable efforts to preserve its relations with customers and suppliers.
42
ARTICLE 10
CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
All obligations of Buyer under this Agreement are subject, at Buyer's
option, to the fulfillment prior to or at the Closing, of each of the following
conditions.
10.01 ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each and every
representation and warranty of Sellers under this Agreement shall be true and
accurate in all material respects.
10.02 PERFORMANCE OF COVENANTS AND AGREEMENTS. Sellers shall have
performed, in all material respects, all of the covenants and agreements
required to be performed by them at or prior to the Closing pursuant to this
Agreement.
10.03 XXXX-XXXXX-XXXXXX ACT. All waiting periods under the HSR Act
applicable to the transactions contemplated by this Agreement shall have
expired, by passage of time or by valid termination by the FTC or the DOJ; no
representative or member of the staff of either the FTC or the DOJ shall be
taking the position that any such waiting period has not expired for any
reason; and no representative or member of the staff of either the FTC or the
DOJ shall have requested a delay of the Closing for a period which has not
expired, which request has not been withdrawn.
10.04 PERMITS, CONSENTS, ETC.
(a) There shall be no Material Permits, consents, or
declarations to or filings with, any Governmental Authority required in
connection with the transactions contemplated by this Agreement and the
Transaction Documents that have not been accomplished
43
or obtained, the failure to have accomplished or obtained would reasonably be
expected to have a Material Adverse Effect.
(b) The non-governmental third party consents set forth on
SCHEDULE 10.04(b) shall have been obtained at or prior to the Closing.
10.05 LITIGATION. No action, suit or proceeding by any third person
(including, without limitation, any Governmental Authority) shall have been
instituted (and remain Pending on the date of the Closing) against Grace, any
CCS Entity or Buyer Entity that questions, or reasonably could be expected to
lead to subsequent questioning of, the validity or legality of this Agreement
or the transactions contemplated by this Agreement or seeks damages against
any Buyer Entity or CCS Entity or injunctive relief in connection therewith.
10.06 CERTIFICATES OF SELLERS. (a) Each Seller shall have delivered
to Buyer its certificate, dated the Closing Date, signed by such Seller or
its Chief Executive Officer or President or any of its Vice Presidents,
certifying that: (i) each and every representation and warranty made by it
under this Agreement is true and accurate in all material respects as of the
Closing; and (ii) such Seller has performed, in all material respects, at or
prior to the Closing all of the covenants and agreements required to be
performed by it at or prior to the Closing pursuant to this Agreement.
(b) On or before the Closing Date, Sellers may deliver to
Buyer one or more proposed amendments to the Schedules to reflect any
information not included in the original Schedules. If Buyer accepts in writing
(which acceptance or rejection shall be in Buyer's sole and absolute discretion)
such amendments to the Schedules and/or the certificates described in clause (a)
containing exceptions, and proceeds with the Closing, then
44
Buyer shall be deemed to have waived any rights against Sellers with respect
to any misrepresentation or breach of warranty disclosed in such amendments
or exceptions.
10.07 OPINION OF SELLERS' COUNSEL. Sellers shall have delivered to
Buyer an opinion of Grace's General Counsel, dated the Closing Date, in the
form of Exhibit 10.07.
10.08 MATERIAL ADVERSE CHANGE. No material adverse change shall have
occurred since the Balance Sheet Date in the business, assets, operations,
prospects or condition (financial or other) of CCS.
10.09 LANDLORD CONSENT/ESTOPPEL LETTERS. Sellers shall provide Buyer
with an estoppel letter reasonably satisfactory to Buyer dated within five
Business Days of the Closing Date from each of the lessors of Leased Real
Property confirming the effectiveness of the applicable lease and the absence
of any default thereunder and, for the property in Boca Raton, FL, consenting
to the transactions contemplated by this Agreement.
ARTICLE 11
CONDITIONS PRECEDENT TO SELLERS' OBLIGATIONS
All obligations of Sellers under this Agreement are subject to the
fulfillment prior to or at the Closing, of each of the following conditions.
11.01 ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each and every
representation and warranty of Buyer under this Agreement shall be true and
accurate in all material respects as of the Closing.
11.02 PERFORMANCE OF COVENANTS AND AGREEMENTS. Buyer shall have
performed, in all material respects, all of the covenants and agreements
required to be performed by Buyer at or prior to the Closing pursuant to this
Agreement.
45
11.03 XXXX-XXXXX-XXXXXX ACT. All waiting periods under the HSR Act
applicable to the transactions contemplated by this Agreement shall have
expired, by passage of time or by valid termination by the FTC or the DOJ; no
representative or member of the staff of either the FTC or the DOJ shall be
taking the position that any such waiting period has not expired for any
reason and no representative or member of the staff of either the FTC or the
DOJ shall have requested a delay of the Closing for a period which has not
expired, which request has not been withdrawn.
11.04 LITIGATION. No action, suit or proceeding by any third person
(including, without limitation, any Governmental Authority) shall have been
instituted (and remain Pending on the date of the Closing) against Grace or
any CCS Entity that questions, or reasonably could be expected to lead to
subsequent questioning of, the validity or legality of this Agreement or the
transactions contemplated by this Agreement or seeks damages from either
Seller or its respective Affiliates or injunctive relief in connection
therewith.
11.05 CERTIFICATE OF BUYER. Buyer shall have delivered to Sellers a
certificate of Buyer, dated the Closing Date, signed by its Chief Executive
Officer or President or any of its Vice Presidents, certifying that: (i) each
and every representation and warranty made by it under this Agreement is true
and accurate in all material respects as of the Closing; and (ii) Buyer has
performed, in all material respects, at or prior to the Closing all of the
covenants and agreements required to be performed by it at or prior to the
Closing pursuant to this Agreement.
46
11.06 OPINION OF BUYER'S COUNSEL. Buyer shall have delivered to Sellers
an opinion of Proskauer Rose LLP, counsel to Buyer, dated the Closing Date, in
the form of Exhibit 11.06.
ARTICLE 12
EMPLOYEE MATTERS
12.01 EMPLOYMENT. Prior to the Closing Date, Buyer shall make an
offer of employment to each employee who is actively employed by CCS on the
Closing Date (each a "TRANSFERRED EMPLOYEE"); provided, however, that any
such offer of employment shall be contingent on the consummation of the
Closing. Sellers consent to Buyer contacting such employees with respect to
the desire of such employees to enter the employ of Buyer. Notwithstanding
the foregoing, nothing herein shall be construed as to prevent Buyer from
terminating the employment of any Transferred Employee at any time after the
Closing Date for any reason (or no reason). Sellers shall deliver to Buyer as
of the Closing Date all personnel files relating to Transferred Employees.
12.02 ASSUMED CCS PLANS. On the Closing Date, Buyer shall assume all
assets and liabilities under each of the CCS Plans and Sellers and Buyer
shall take all action as may be necessary or appropriate to establish Buyer
as the successor as to all rights, duties, assets and liabilities under, or
with respect to, the CCS Plans so assumed. Notwithstanding the foregoing,
Buyer shall have the right (consistent with applicable law) to continue,
terminate, merge or make changes or cause changes to be made in any CCS Plan
or in any compensation, benefits and other terms of employment of any
Transferred Employee.
47
ARTICLE 13
TERMINATION
13.01 RIGHTS TO TERMINATE.
(a) This Agreement may be terminated at any time prior to
the Closing by written agreement of Sellers and Buyer.
(b) If for any reason the Closing shall not take place on
the Scheduled Closing Date (as it may be postponed by an amendment to this
Agreement executed in accordance with Section 19.05) or within ten Business Days
thereafter, then either Grace or Buyer may terminate this Agreement at any time
thereafter.
(c) This Agreement may be terminated by Sellers at any time
prior to the Closing by written notice to Buyer if Grace determines that an
Acquisition Proposal constitutes a Superior Proposal pursuant to the provisions
of Section 8.05 herein.
(d) This Agreement may be terminated at any time prior to
the Closing by Sellers or Buyer if:
(i) Xxxxxx shall not have received, by the
Scheduled Closing Date, the approval of the sale of Nestor's interest in CCS to
Grace from the holders of the ordinary shares of Xxxxxx by a simple majority of
the votes cast at an extraordinary general meeting (the "XXXXXX SHAREHOLDERS'
APPROVAL"); or
(ii) an action, suit or proceeding by a third
person (including, without limitation, any Governmental Authority) has been
instituted (and remains Pending on the date of the Closing) against Xxxxxx or
any of its Subsidiaries that questions or reasonably could be expected to lead
to subsequent questioning of, the legality of the sale of Nestor's interest
48
in CCS to Grace or seeks damages against Xxxxxx or any of its Subsidiaries or
injunctive relief in connection therewith.
13.02 CONSEQUENCES OF TERMINATION.
(a) The termination of this Agreement shall not affect a
party's obligation to the other parties hereto (and all related Persons) for any
prior breach of any covenant or agreement contained in this Agreement, except
that upon termination of this Agreement in accordance with: (i) any of the
provisions of Section 13.01, the parties (and all related Persons) shall be
released from any and all liability for breach of any of the representations and
warranties contained in Articles 5 and 6 of this Agreement, (ii) Section
13.01(c), Sellers shall pay to Buyer an aggregate fee of $6 million plus actual
third party expenses of Buyer, not in excess of $900,000, relating to the
transactions contemplated by this Agreement (including, without limitation, fees
and expenses of Buyer's counsel and counsel to Buyer's lenders) (the "BUYER'-
EXPENSES" and together with the $6 million fee, the "BREAK-UP FEE"), and (iii)
Section 13.01(d)(i), Sellers shall pay to Buyer the amount of Buyer's Expenses;
PROVIDED, HOWEVER, that if Sellers accept a Superior Proposal within 12 months
from the date of termination of this Agreement pursuant to Section 13.01(d)(i),
Sellers shall pay to Buyer the Break-Up Fee (less the amount of the Buyer's
Expenses previously paid). Termination of this Agreement pursuant to Section
13.01(c) shall not be effective until the Break-Up Fee has been paid.
(b) In the event of termination of this Agreement pursuant to Section
13.01 by either Sellers or Buyer, Sections 13.02, 17.01 and 17.02 shall survive
any such termination.
49
ARTICLE 14
INDEMNIFICATION
14.01 DEFINITIONS.
(a) "Claim" means any claim, demand, suit, action or
proceeding.
(b) "Damages" means any and all penalties, fines, damages,
liabilities, losses, costs or expenses (including reasonable Litigation
Expenses).
(c) "Direct Claims" means Claims other than Third Party
Claims.
(d) "Litigation Expenses" means attorneys' fees and other
costs and expenses incident to investigations or proceedings respecting, or the
prosecution or defense of, a Claim.
(e) "Third Party Claims" means any and all Claims by any
Person, other than any Grace Entity, CCS Entity or Buyer, which could give rise
to a right of indemnification under this Article.
14.02 SELLERS' INDEMNIFICATION.
(a) Subject to the terms and limitations of this Article,
each of the Sellers shall severally and jointly indemnify Buyer and the other
Buyer Entities against any Damages which are caused by or arise out of: (i) the
failure to perform or fulfill any covenant or agreement to be performed or
fulfilled by the Sellers under this Agreement or any of the Transaction
Documents, (ii) any inaccuracy in any representation or breach of any warranty
made by the Sellers in Article 5, (iii) the failure to comply with any
applicable bulk transfer law, or (iv) the Retained Liabilities.
50
(b) The representations and warranties set forth in Article
5 shall survive the Closing; PROVIDED, HOWEVER, that (i) the representations and
warranties set forth in Sections 5.01 through 5.03 and Sections 5.12 and 5.16
shall expire and be of no further force or effect upon the expiration of the
statute of limitations applicable to the relevant Claim and (ii) the
representations and warranties set forth in Sections 5.04 and subsequent
Sections of Article 5 (other than Sections 5.12 and 5.16) shall expire and be of
no further force and effect 12 months after the Closing Date, except in both
cases, with respect to Claims which Buyer or other Buyer Entities have
previously asserted in writing against Sellers describing the nature of such
Claims with reasonable specificity, such representation or warranty shall not
expire until the Claims are finally resolved.
(c) Any indemnification payment under this Section shall
be treated as a reduction of the Purchase Price.
14.03 BUYER'S INDEMNIFICATION.
(a) Subject to the terms and limitations of this Article,
Buyer shall indemnify Sellers and the other Grace Entities against any Damages
which are caused by or arise out of (i) the failure to perform or fulfill any
covenant or agreement to be performed or fulfilled by Buyer under this Agreement
or any of the Transaction Documents, (ii) any inaccuracy in any representation
or breach of any warranty made by Buyer in Article 6 or (iii) the Assumed
Liabilities.
(b) The representations and warranties set forth in Article
6 shall survive the Closing; PROVIDED, HOWEVER, that the representations and
warranties set forth in Sections 6.01 through 6.05 shall expire and be of no
further force or effect upon the expiration of the
51
statute of limitations applicable to the relevant Claim, except with respect
to Claims which Sellers or other Grace Entities have previously asserted in
writing against Buyer describing the nature of such Claims with reasonable
specificity, such representation or warranty shall not expire until the
Claims are finally resolved.
14.04 LIMITATIONS WITH RESPECT TO CERTAIN CLAIMS.
(a) No Buyer Entity may assert any Claim for indemnification
(collectively, "BUYERS' CLAIMS"), with respect to the breach of any
representation or warranty made in Section 5.04 or subsequent Sections of
Article 5, unless (i) Buyers' Claims give rise to Damages, which individually or
together with all other related Buyers' Claims exceed $25,000, and (ii) unless
and until the aggregate amount of such Buyers' Claims assertable under clause
(i) shall exceed $1,000,000, and then only with respect to the excess of such
aggregate Buyers' Claims over said $1,000,000.
(b) In no event shall the aggregate amount of the Sellers'
indemnification obligations under Sections 14.02(a)(i) and 14.02(a)(ii) of this
Agreement exceed the Purchase Price. In no event shall the aggregate amount of
Buyer's indemnification obligations under Sections 14.03(a)(i) and 14.03(a)(ii)
of this Agreement exceed the Purchase Price.
(c) The dollar thresholds set forth in this Section have
been negotiated for the special purpose of the provision to which they relate,
and are not to be taken as evidence of the level of "materiality" for purposes
of any statutory or common law which may be applicable to the transactions
contemplated by this Agreement under which a level of materiality might be an
issue.
52
(d) The limitations set forth in Sections 14.04(a) and
14.04(b) shall not apply to any other claims for indemnification under this
Agreement.
14.05 DEFENSE OF THIRD PARTY CLAIMS.
(a) If any Person intends to seek indemnification under this
Agreement for a Third Party Claim, or to have a Third Party Claim taken into
account for purposes of the dollar thresholds of Section 14.04, such Person (an
"INDEMNITEE" with respect to such Third Party Claim) shall notify the Persons
from whom it intends to seek such indemnification or request the taking into
account of such Claim (the "INDEMNITORS" with respect to such Third Party Claim)
in writing as soon as reasonably practicable after learning of such Third Party
Claim. It shall be a necessary condition of any Claim by any Indemnitee for
indemnification with respect to any Third Party Claim, or for such Third Party
Claim to be taken into account for purposes of the dollar thresholds under
Section 14.04, that such lndemnitee notify the Indemnitors prior to the time
when the Indemnitors' ability to contest the Third Party Claim would be
materially impaired by lack of notice (the "NOTICE CONDITION"). If the Notice
Condition is not met with respect to a Third Party Claim, then the lndemnitees
shall be deemed to have waived their rights to indemnification or payment with
respect to such Third Party Claim to the extent the Indemnitor's ability to
contest such Third Party Claim has been impaired by such lack of notice.
(b) Except as otherwise provided in subsection (c) of this
Section, the lndemnitors may undertake the defense of a Third Party Claim of
which the Indemnitees have notified the Indemnitors, by notice to the
Indemnitees not later than 30 calendar days after receipt by the lndemnitors of
Indemnitees' notice of the claim. Failure on the part of the
53
Indemnitors to so notify the lndemnitees that they will undertake such
defense shall be deemed to be a waiver of the lndemnitors' right to undertake
such defense. If the Indemnitors undertake the defense of any Third Party
Claim, they shall control the investigation and defense thereof, except that
the Indemnitors shall not require any Indemnitee, without its prior written
consent, to take or refrain from taking any action in connection with such
Third Party Claim, or make any public statement, which such lndemnitee
reasonably considers to be against its interest, nor shall the Indemnitors,
without the prior written consent of the Indemnitees, consent to any
settlement that does not consist solely of the payment of money by the
Indemnitors (or by the Indemnitees if the thresholds in Section 14.04 have
not yet been satisfied) and an unconditional release of the Indemnitees; and
subject to the Indemnitors' control rights, the Indemnitees may participate
in such investigation and defense, at their own expense. If the Indemnitors
do not undertake the defense of a Third Party Claim, then except as otherwise
provided in subsection (c) of this Section, the lndemnitees shall control
such investigation and defense, except that the Indemnitees shall not require
any Indemnitor, without its prior written consent, to take or refrain from
taking any action in connection with such Third Party Claim, or make any
public statement, which such lndemnitor reasonably considers to be against
its interest; with respect to any Third Party Claim for which Indemnitors
have agreed to assume the liability but have not undertaken the defense, no
Indemnitee shall consent to any settlement of such Third Party Claim without
the prior written consent of the Indemnitors which consent will not be
unreasonably withheld; and subject to the lndemnitees' control rights, the
Indemnitors may participate in such investigation and defense, at their own
expense.
54
(c) If there is a material conflict of interest between the
Indemnitors and the Indemnitees with respect to a Third Party Claim, neither
group shall be entitled to assume the defense thereof. In that event the
Indemnitors and the Indemnitees each shall be entitled to conduct their own
respective investigations and defenses, but they shall cooperate to conduct such
investigation and defense as efficiently as possible. If the Indemnitors are
required to indemnify the lndemnitees with respect to such Third Party Claim,
they shall pay the reasonable attorneys' fees and expenses of one individual or
firm representing the Indemnitees and one local counsel in each relevant
jurisdiction with respect thereto.
(d) Buyer and Sellers shall make available to each other,
their counsel and other representatives, all information and documents
reasonably available to them which relate to any Third Party Claim or any Tax
liability which is a Retained Liability, and otherwise cooperate as may
reasonably be required in connection with the investigation and defense thereof.
Grace shall have sole authority to conduct the defense on behalf of the CCS
Entities of any IRS audit of the CCS Entities' meals and incidentals program for
all Tax years ending on or prior to Closing. Buyer shall cooperate in providing
reasonable assistance to Grace, at no cost to Buyer, in the defense thereof.
Grace shall retain exclusive authority to settle any such audit on terms and
conditions as Grace may determine.
14.06 PUNITIVE DAMAGES. No party to this Agreement, nor any other Grace
Entity, CCS Entity or Buyer Entity, shall seek or be entitled to punitive
Damages with respect to any Direct Claim, nor shall it accept payment of any
award or judgment for such Direct Claim to the extent that such award or
judgment includes such punitive Damages.
55
ARTICLE 15
COOPERATION IN VARIOUS MATTERS
15.01 MUTUAL COOPERATION.
After the Closing, Sellers and Buyer shall cooperate with
each other as reasonably requested between them in connection with the
prosecution or defense of any claims or other matters relating to the Business
or the Assets. Such cooperation shall include the furnishing of testimony and
other evidence, permitting access to employees, and providing information
regarding the whereabouts of former employees.
15.02 PRESERVATION OF SELLERS' FILES AND RECORDS. For a period of
six years after the Closing, Sellers shall, and shall cause their respective
Subsidiaries to, preserve all files and records in their possession relating
directly and primarily to CCS and its business, allow the Buyer Group access
to such files and records and the right to make copies and extracts therefrom
at any time during normal business hours, and not dispose of any thereof,
except that at any time after the Closing, either Seller may, but shall not
be required to, give Buyer written notice of its intention to dispose of any
records that are more than six years old, specifying the items to be disposed
of in reasonable detail. Any Buyer Entity may, within a period of sixty days
after receipt of any such notice, notify such Seller of the Buyer Group's
desire to retain one or more of the items to be disposed of. Such Seller
shall, upon receipt of such a notice from the Buyer Group, deliver such items
as reasonably requested, at the Buyer Group's expense.
56
ARTICLE 16
POST-CLOSING MATTERS
16.01 INFORMATION FOR REPORTS. At the reasonable request of Sellers,
Buyer shall provide to Sellers on a timely basis, in such form as Sellers may
reasonably request, such information relating to CCS and the Business for
periods ending on or prior to the Closing Date as Sellers may require in
order to enable it to prepare financial, Tax and other reports and statements
for such periods.
16.02 COVENANT NOT TO COMPETE. Grace agrees with respect to all
Grace Entities that for a period of three (3) years after the Closing Date,
no such entity shall engage directly or indirectly, anywhere in the United
States, in the business of providing health care professionals to hospitals
and other health care facilities on a temporary or short-term basis; PROVIDED
that the foregoing shall not apply to provision of such services by a
business acquired by a Grace Entity after the Closing Date if, in the year
prior to such acquisition, its net sales of such services were less than 20%
of the net sales of the entire acquired business. A Grace Entity may also
acquire a business that exceeds the threshold set forth in the immediately
preceding sentence; PROVIDED that the entity divests the unit of such
business providing such services within one year after its acquisition; and
PROVIDED, FURTHER, that if the entity shall not have effected such
divestiture within one year after acquisition despite its reasonably diligent
efforts, Buyer shall grant the entity reasonable extension of the divestiture
period not to exceed six months. If the entity proposes to sell the unit of
the acquired business that provides such services, it shall notify Buyer and
give Buyer the opportunity to participate
57
in the bidding or other process for the sale of such unit on a basis
substantially equal to other interested parties.
16.03 CONFIDENTIALITY AGREEMENTS. Each of the Sellers hereby agrees
to assign their respective rights to those certain confidentiality agreements
with Persons who had been previously solicited to acquire the Business. Such
confidentiality agreements shall be among the Assumed Contracts. To the
extent that such agreements may not be assigned to Buyer, Sellers agree to
take all reasonable actions requested by Buyer to enforce such agreements,
including the commencement of litigation. Buyer agrees to pay all third party
costs and expenses incurred by Sellers in enforcing such agreements, and to
indemnify and hold harmless Sellers against any Damages arising out of such
enforcement activities.
16.04 INSURANCE. Buyer shall have no rights under any of the
insurance policies maintained by any Seller or Grace Entity on behalf of the
CCS Group or its business or assets with respect to events or occurrences
after 11:59 p.m. local time on the Closing Date (the "CUT-OFF TIME"), or
under any of the claims made policies included in such policies with respect
to claims not made before the Cut-Off Time, and any amounts received with
respect to such policies shall be promptly paid over to the relevant Person.
With respect to rights and claims related to events or occurrences prior to
the Cut-Off Time under such policies or the policies on SCHEDULE 5.09(a),
Buyer shall be entitled to all rights under such insurance policies. In
addition, Sellers agree to take all reasonable actions requested by Buyer to
provide Buyer the rights set forth in the immediately proceeding sentence and
Buyer shall be responsible for the making and administration of any claims,
and Sellers shall provide such cooperation as Buyer may reasonably request in
connection therewith. Any amounts
58
received with respect to such policies shall be promptly paid over to Buyer.
All rights of Buyer with respect to such policies shall be subject to the
terms and conditions of the policies included therein.
16.05 USE OF "CROSS COUNTRY" NAME. As soon as practicable after the
Closing, Sellers shall use their reasonable efforts to change the name of CCS
to a name that does not include any of the words "Cross Country Staffing."
ARTICLE 17
EXPENSES
17.01 BUYER'S EXPENSES. Buyer shall pay and indemnify Sellers
against all expenses incurred by or on behalf of Buyer in connection with the
preparation, authorization, execution and performance of this Agreement and
the transactions contemplated hereby, including, but not limited to, all fees
and expenses of Buyer's brokers, finders, agents, representatives, counsel
and accountants.
17.02 SELLERS' EXPENSES. Each Seller shall pay or cause to be paid
and indemnify Buyer against all expenses incurred by or on behalf of it, or
by or on behalf of its Affiliate, in connection with the preparation,
authorization, execution and performance of this Agreement and the
transactions contemplated hereby, including, but not limited to, all fees and
expenses of CS First Boston and all fees and expenses of brokers, finders,
agents, representatives, counsel and accountants of the Sellers and their
respective Affiliates and CCS.
17.03 TRANSFER TAXES. Buyer and the Sellers (treating the Sellers as
a single entity for this purpose) each shall pay 50% of any sales, transfer,
value added, excise, recording,
59
registration or similar Taxes applicable to the transfer of the Assets
pursuant to this Agreement.
ARTICLE 18
NOTICES
18.01 NOTICES. All notices, requests, demands and other
communications required or permitted to be given under this Agreement or any
of the Transaction Documents shall be deemed to have been duly given if in
writing and delivered personally, delivered by facsimile transmission (upon
telephonic confirmation of receipt), or delivered by overnight courier or
first-class, postage prepaid, registered or certified mail, return receipt
requested, addressed as follows:
If to Grace or CCS:
X.X. Xxxxx & Co.-Xxxx.
0000 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Secretary
Fax: (000) 000-0000
Confirmation: (000) 000-0000
If to Buyer:
Cross Country Holdings, Inc.
c/o Charterhouse Group International, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
Confirmation: (000) 000-0000
60
with a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
Confirmation: (000) 000-0000
Any party may change the address to which such communications are to be
directed to it by giving written notice to Sellers in the manner provided above.
ARTICLE 19
GENERAL
19.01 ENTIRE AGREEMENT. The Transaction Documents set forth the
entire agreement and understanding of the parties with respect to the subject
matter hereof and thereof and supersede all prior agreements, arrangements
and understandings relating thereto. No representation, promise, inducement
or statement of intention relating to the transactions contemplated by this
Agreement has been made by any party or any related person which is not set
forth in the Transaction Documents.
19.02 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, excluding any
conflict-of-laws provisions thereof that would otherwise require the
application of the law of any other jurisdiction.
19.03 SUBMISSION TO JURISDICTION. Each party to this Agreement
hereby irrevocably submits in any suit, action or proceeding arising out of
or relating to this Agreement or any of the Transaction Documents to which it
is or will be a party, or any of its obligations hereunder or thereunder, to
the jurisdiction of the United States District Court for the Southern
District of New York and the jurisdiction of any court of the State of New
York
61
located in New York County, and waives any and all objections to such
jurisdiction that it may have under the laws of the State of New York or any
other jurisdiction.
19.04 SUCCESSORS AND ASSIGNS. This Agreement shall be assignable by
Buyer only with the prior written consent of Sellers, and by Sellers only
with the written prior consent of Buyer; PROVIDED, that Buyer may, without
such consent, assign its rights under this Agreement to any Affiliate of
Buyer or to any Person providing financing to Buyer. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
19.05 AMENDMENTS AND WAIVERS. This Agreement may be amended,
superseded or canceled, and any of the terms hereof may be waived, only by a
written instrument specifically referring to this Agreement and specifically
stating that it amends, supersedes or cancels this Agreement or waives any of
its terms, executed by Sellers and Buyer. Failure of any party to insist upon
strict compliance with any of the terms of this Agreement in one or more
instances shall not be deemed to be a waiver of its rights to insist upon
such compliance in the future, or upon compliance with other terms hereof.
19.06 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which counterparts may be signed by one or more
parties. Each such counterpart shall be an original, but all such
counterparts shall constitute but one agreement.
19.07 CAPTIONS. The captions used in this Agreement are for
convenience of reference only and shall not be considered in the
interpretation of the provisions hereof.
62
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written. X. X. XXXXX & CO.-CONN.
By: /s/ Xxxxx Xxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
CROSS COUNTRY HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman
CROSS COUNTRY STAFFING
By: CCHP, INC., ITS GENERAL PARTNER
By: /s/ Xxxxx Xxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
By: MRA STAFFING SYSTEMS, INC.,
its general partner
By: /s/ Xxxxx Xxxx
----------------------------------
Name: Xxxxx Xxxx
Title: President
63
The performance by X. X. Xxxxx & Co.-Xxxx. and Cross Country Staffing of their
respective obligations under the foregoing Asset Purchase Agreement is hereby
guaranteed:
X. X. XXXXX & CO.
By: /s/ Xxxxx Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
The performance by Cross Country Holdings, Inc. of its obligations under the
foregoing Asset Purchase Agreement is hereby guaranteed:
CHARTERHOUSE EQUITY PARTNERS III, L.P.
BY CHUSA EQUITY INVESTORS III, L.P., ITS GENERAL PARTNER
BY CHARTERHOUSE EQUITY III, INC., ITS GENERAL PARTNER
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Managing Director
64
