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EXHIBIT 2
EXECUTION COPY
SHARE PURCHASE AGREEMENT
RELATING TO THE ACQUISITION OF
ALL OF THE OUTSTANDING CAPITAL STOCK OF
XXXXX X. XXXXX FINANCIAL SERVICES, INC.
BY
INTREPID CAPITAL CORPORATION
DATED AS OF
AUGUST 4, 1999
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TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINED TERMS..........................................................................................1
ARTICLE 2. SALE AND PURCHASE OF THE SHARES........................................................................2
2.1 SALE AND PURCHASE........................................................................................2
2.2 PURCHASE PRICE...........................................................................................2
2.3 ADJUSTMENT TO THE PURCHASE PRICE.........................................................................3
2.4 PREPARATION OF THE CLOSING DATE BALANCE SHEET............................................................3
2.5 RESOLUTION OF DISPUTES...................................................................................3
2.6 POST-CLOSING PAYMENTS....................................................................................4
2.7 OPTION SECURITIES AND CONVERTIBLE SECURITIES.............................................................4
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF THE XXXXX SHAREHOLDERS...............................................4
3.1 ORGANIZATION AND BUSINESS; POWER AND AUTHORITY; EFFECT OF TRANSACTION....................................4
3.2 TITLE TO SHARES..........................................................................................5
3.3 XXXXX'X FINANCIAL AND OTHER INFORMATION..................................................................6
3.4 MATERIAL STATEMENTS AND OMISSIONS; ABSENCE OF EVENTS.....................................................6
3.5 TITLE TO PROPERTIES......................................................................................6
3.6 RELATED TRANSACTIONS.....................................................................................7
3.7 INSURANCE................................................................................................7
3.8 EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974..........................................................7
3.9 SOLVENCY.................................................................................................8
3.10 BANK ACCOUNTS, ETC.......................................................................................8
3.11 ORDINARY COURSE OF BUSINESS..............................................................................8
3.12 MATERIAL AND ADVERSE RESTRICTIONS........................................................................9
3.13 BROKER OR FINDER.........................................................................................9
3.14 CAPITAL STOCK............................................................................................9
3.15 QUALIFICATION OF THE XXXXX SHAREHOLDERS.................................................................10
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF XXXXXX, SYNAGEN AND XXXXXXXXX.......................................10
4.1 COMPLIANCE WITH PRIVATE AUTHORIZATIONS..................................................................11
4.2 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE LAW..........................................11
4.3 INTANGIBLE ASSETS.......................................................................................13
4.4 TAX MATTERS.............................................................................................14
4.5 EMPLOYMENT AND CONSULTING ARRANGEMENTS..................................................................14
4.6 MATERIAL AGREEMENTS.....................................................................................15
4.7 ENVIRONMENTAL MATTERS...................................................................................15
4.8 YEAR 2000 COMPLIANCE....................................................................................16
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF XXXXXX..............................................................16
5.1 COMPLIANCE WITH PRIVATE AUTHORIZATIONS..................................................................16
5.2 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE LAW..........................................17
5.3 INTANGIBLE ASSETS.......................................................................................19
5.4 TAX MATTERS.............................................................................................19
5.5 EMPLOYMENT AND CONSULTING ARRANGEMENTS..................................................................20
5.6 MATERIAL AGREEMENTS.....................................................................................20
5.7 ENVIRONMENTAL MATTERS...................................................................................21
5.8 YEAR 2000 COMPLIANCE....................................................................................21
ARTICLE 6. REPRESENTATIONS AND WARRANTIES OF INTREPID............................................................22
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6.1 ORGANIZATION AND BUSINESS; POWER AND AUTHORITY; EFFECT OF TRANSACTION...................................22
6.2 INTREPID'S FINANCIAL AND OTHER INFORMATION..............................................................23
6.3 MATERIAL STATEMENTS AND OMISSIONS; ABSENCE OF EVENTS....................................................23
6.4 TITLE TO PROPERTIES.....................................................................................24
6.5 COMPLIANCE WITH PRIVATE AUTHORIZATIONS..................................................................24
6.6 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE LAW..........................................24
6.7 INTANGIBLE ASSETS.......................................................................................27
6.8 RELATED TRANSACTIONS....................................................................................27
6.9 INSURANCE...............................................................................................27
6.10 TAX MATTERS.............................................................................................27
6.11 EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974.........................................................28
6.12 SOLVENCY................................................................................................28
6.13 MATERIAL AND ADVERSE RESTRICTIONS.......................................................................28
6.14 BROKER OR FINDER........................................................................................29
6.15 ENVIRONMENTAL MATTERS...................................................................................29
6.16 YEAR 2000 COMPLIANCE....................................................................................29
ARTICLE 7. COVENANTS.............................................................................................30
7.1 ACCESS TO INFORMATION...................................................................................30
7.2 CONDUCT OF THE BUSINESS PRIOR TO THE CLOSING............................................................30
7.3 AGREEMENT TO COOPERATE..................................................................................32
7.4 SATISFACTION OF CONDITIONS..............................................................................32
7.5 NOTICE OF DEVELOPMENTS..................................................................................32
7.6 EMPLOYEE BENEFITS.......................................................................................32
7.7 ELECTIONS TO THE BOARD OF DIRECTORS.....................................................................32
7.8 ADVANCE TO EMPLOYEE.....................................................................................32
7.9 KEY MAN INSURANCE.......................................................................................33
7.10 RULE 144................................................................................................33
ARTICLE 8. CLOSING; CLOSING DATE; DELIVERIES.....................................................................33
8.1 CLOSING; CLOSING DATE...................................................................................33
8.2 DELIVERIES BY THE XXXXX SHAREHOLDERS....................................................................33
8.3 DELIVERIES BY INTREPID..................................................................................34
ARTICLE 9. CONDITIONS PRECEDENT TO OBLIGATIONS...................................................................34
9.1 CONDITIONS TO OBLIGATIONS OF INTREPID...................................................................34
9.2 CONDITIONS TO OBLIGATIONS OF THE XXXXX SHAREHOLDERS.....................................................35
ARTICLE 10. INDEMNIFICATION......................................................................................36
10.1 SURVIVAL................................................................................................36
10.2 INDEMNIFICATION.........................................................................................36
10.3 LIMITATION OF LIABILITY.................................................................................37
10.4 NOTICE OF CLAIMS........................................................................................37
10.5 DEFENSE OF THIRD PARTY CLAIMS...........................................................................37
10.6 RIGHT OF SET-OFF........................................................................................38
10.7 EXCLUSIVE REMEDY........................................................................................38
ARTICLE 11. TERMINATION..........................................................................................38
11.1 TERMINATION BY INTREPID.................................................................................38
11.2 TERMINATION BY THE XXXXX SHAREHOLDERS...................................................................39
11.3 TERMINATION BY ANY PARTY................................................................................39
11.4 TERMINATION BY MUTUAL CONSENT...........................................................................39
11.5 EFFECT OF TERMINATION...................................................................................39
ARTICLE 12. GENERAL PROVISIONS...................................................................................39
12.1 WAIVERS; AMENDMENTS.....................................................................................39
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12.2 FEES, EXPENSES AND OTHER PAYMENTS.......................................................................40
12.3 NOTICES.................................................................................................40
12.4 SPECIFIC PERFORMANCE; OTHER RIGHTS AND REMEDIES.........................................................41
12.5 SEVERABILITY............................................................................................41
12.6 COUNTERPARTS............................................................................................42
12.7 SECTION HEADINGS........................................................................................42
12.8 GOVERNING LAW...........................................................................................42
12.9 FURTHER ACTS............................................................................................42
12.10 ENTIRE AGREEMENT........................................................................................42
12.11 EXHIBITS................................................................................................43
12.12 ASSIGNMENT..............................................................................................43
12.13 PARTIES IN INTEREST.....................................................................................43
12.14 MUTUAL DRAFTING.........................................................................................43
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APPENDICES
APPENDIX NO. DESCRIPTION
------------ -----------
APPENDIX I: Definitions
LIST OF EXHIBITS
EXHIBIT NO. DESCRIPTION
----------- -----------
EXHIBIT A: Non-Negotiable Subordinated Convertible Promissory Note
EXHIBIT B: Non-Negotiable Subordinated Convertible Promissory Note
EXHIBIT C: Non-Negotiable Subordinated Convertible Promissory Note
EXHIBIT D: Xxxxxxxx X. Xxxxxx, Xx. Employment Agreement
EXHIBIT E: Xxxxx Xxxxx Employment Agreement
EXHIBIT F: Matters As To Which Xxxxx & Xxxxxxx Will Opine
EXHIBIT G: Matters As To Which Xxxxxx & Xxxxxx Will Opine
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SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT (the "Agreement") is made and entered
into as of August 4, 1999 by and among INTREPID CAPITAL CORPORATION, a Delaware
corporation ("Intrepid"), XXXXXXXX X. XXXXXX, XX., an individual resident of
the State of Florida ("Xxxxxx"), XXXXXXX X. XXXXXX, as trustee of the Xxxxxxx
X. Xxxxxx Revocable Trust dated September 10, 1997 ("Xxxxxx"), SYNAGEN CAPITAL
PARTNERS, INC., a Florida corporation ("Synagen"), and XXXXXX X. XXXXXXXXX, an
individual resident of the State of Florida ("Xxxxxxxxx" and, together with
Xxxxxx, Xxxxxx and Synagen, referred to herein collectively as the "Xxxxx
Shareholders").
W I T N E S S E T H:
WHEREAS, the Xxxxx Shareholders own in the aggregate 5,426 shares (the
"Shares") of the common stock, par value $.10 per share (the "Xxxxx Common
Stock"), of Xxxxx X. Xxxxx Financial Services, Inc., a Florida corporation
("Xxxxx"), which Shares represent all of the issued and outstanding capital
stock of Xxxxx; and
WHEREAS, Intrepid desires to purchase from the Xxxxx Shareholders, and
the Xxxxx Shareholders desire to sell to Intrepid, all of the Shares in
exchange for the Purchase Price (as hereinafter defined) in accordance with the
terms and conditions set forth in this Agreement (hereinafter referred to as
the "Share Purchase");
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements herein contained and
other valuable consideration, the receipt and adequacy whereof are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby
represent, warrant, covenant and agree as follows:
ARTICLE 1.
DEFINED TERMS
As used herein, unless the context otherwise requires, the terms
defined in Appendix I shall have the respective meanings set forth therein.
Terms defined in the singular shall have a comparable meaning when used in the
plural, and vice versa, and the reference to any gender shall be deemed to
include all genders. Unless otherwise defined or the context otherwise clearly
requires, terms for which meanings are provided in this Agreement shall have
such meanings when used in the Xxxxx Disclosure Schedule, the Intrepid
Disclosure Schedule and the Collateral Documents executed or required to be
executed pursuant hereto or thereto or otherwise delivered, from time to time,
pursuant hereto or thereto. References to "hereof," "herein" or similar terms
are intended to refer to the Agreement as a whole and not a particular section,
and references to "this Section" or "this Article" are intended to refer to the
entire section or article and not a particular subsection thereof. As used
herein, (a) the term "either party" shall, unless the context otherwise
requires, refer to Intrepid, on the one hand, and the Xxxxx Shareholders, on
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the other hand, and (b) the terms "include", including" and "includes" are each
deemed to be followed by the words "without limitation".
ARTICLE 2.
SALE AND PURCHASE OF THE SHARES
2.1 SALE AND PURCHASE. Subject to the terms and conditions
hereinafter set forth and on the basis of and in reliance upon the
representations, warranties, obligations and agreements set forth herein, on
the Closing Date, the Xxxxx Shareholders shall sell, assign, convey and
transfer to Intrepid, and Intrepid shall purchase from the Xxxxx Shareholders,
all of the Shares in exchange for an amount equal to the Purchase Price, as
defined in Section 2.2. The Xxxxx Shareholders shall deliver on the Closing
Date, free and clear of all Liens, all certificates representing the Shares,
duly endorsed in blank or accompanied by appropriate stock powers executed in
blank.
2.2 PURCHASE PRICE. The purchase price for the Shares (the
"Purchase Price") shall be $1,300,000, as the same may be adjusted pursuant to
the terms of Section 2.3 hereof, and shall be paid by Intrepid on the Closing
Date as follows:
(a) One Hundred Twelve Thousand Two Hundred Fifty
Seventy Cents ($112,250.70) of the Purchase Price shall be paid to
Xxxxxx in cash by wire transfer of immediately available funds to an
account designated by Xxxxxx in writing no later than two (2) business
days prior to the Closing Date.
(b) Seven Hundred Fifty-Five Thousand Two Hundred
Forty-Three Dollars and Five Cents ($755,243.05) of the Purchase Price
shall be paid to Synagen by delivery of (i) cash in the amount of Six
Hundred Fifty-Five Thousand Two Hundred Forty-Three Dollars and Five
Cents ($655,243.05) by wire transfer of immediately available funds to
an account designated by Synagen in writing no later than two (2)
business days prior to the Closing Date; and (ii) Intrepid's
promissory note in the principal amount of One Hundred Thousand
Dollars ($100,000) substantially in the form attached hereto as
Exhibit "A" (the "Synagen Promissory Note").
(c) Three Hundred Six Thousand Six Hundred Sixty-Nine
Dollars and Eighty Cents ($306,669.80) of the Purchase Price shall be
paid to Xxxxxx by delivery of (i) cash in the amount of One Hundred
Six Thousand Six Hundred Sixty-Nine Dollars and Eighty Cents
($106,669.80) by wire transfer of immediately available funds to an
account designated by Xxxxxx in writing no later than two (2) business
days prior to the Closing Date; and (ii) Intrepid's promissory note in
the principal amount of Two Hundred Thousand Dollars ($200,000)
substantially in the form attached hereto as Exhibit "B" (the "Xxxxxx
Promissory Note ").
(d) One Hundred Twenty-Five Thousand Eight Hundred Thirty-Six
Dollars and Forty-Five Cents ($125,836.45) of the Purchase Price shall
be paid to Xxxxxxxxx by delivery of (i) cash in the amount of
Seventy-Five Thousand Eight Hundred Thirty-Six Dollars and Forty-Five
Cents ($75,836.45) by wire transfer of immediately available
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funds to an account designated by Xxxxxxxxx in writing no later than
two (2) business days prior to the Closing Date; and (ii) Intrepid's
promissory note in the principal amount of Fifty Thousand Dollars
($50,000) substantially in the form attached hereto as Exhibit "C"
(the "Xxxxxxxxx Promissory Note ").
Notwithstanding the foregoing, Intrepid shall retain $10,000 of the cash
portion of the Purchase Price (the "Holdback Amount"), which shall be
distributed in accordance with the following: (i) a portion of the Holdback
Amount shall be paid by Intrepid to the NASD after the Closing for fines (the
"NASD Fines") levied against Xxxxx in connection with its recently concluded
examination once the amount of such fines has been liquidated; and (ii) the
Pro-Rata Amount of the balance, if any, of the Holdback Amount shall be paid to
the Xxxxx Shareholders in accordance with the terms of this Section 2.2 after
Intrepid has paid the NASD Fines. If the NASD Fines are greater than the
Holdback Amount, each Xxxxx Shareholder shall immediately pay such Xxxxx
Shareholder's Pro Rata Amount of such excess to Intrepid by wire transfer of
immediately available funds to an account designated by Intrepid.
2.3 ADJUSTMENT TO THE PURCHASE PRICE. As the case may be, on a
dollar-for-dollar basis, the cash portion of each Xxxxx Shareholder's Pro-Rata
Amount of the Purchase Price shall be reduced or increased by the Pro-Rata
Amount of such reduction or increase to such cash portion of the Purchase Price
to the extent that the shareholders' equity of Xxxxx as of the Closing Date
(the "Actual Equity"), as set forth on the Closing Date Balance Sheet, is below
or above One Million Three Hundred Thousand Dollars ($1,300,000) (the "Target
Equity").
2.4 PREPARATION OF THE CLOSING DATE BALANCE SHEET. As soon as
practicable (but in no event later than twenty (20) days after the Closing
Date), Intrepid, at its cost and expense, shall cause a balance sheet for Xxxxx
to be prepared as of the close of business on the Closing Date (the "Closing
Date Balance Sheet"). The Closing Date Balance Sheet shall be prepared in
accordance with GAAP, using the same methods and criteria employed by Xxxxx in
connection with the preparation of its most recent year-end balance sheet to
the extent such methods are consistent with GAAP, and shall present fairly
Xxxxx'x financial position as of the Closing Date. Upon completion of the
preparation of the Closing Date Balance Sheet, copies thereof shall promptly be
provided to the Xxxxx Shareholders.
2.5 RESOLUTION OF DISPUTES. If the Xxxxx Shareholders shall notify
Intrepid within fifteen (15) days after receipt of the Closing Date Balance
Sheet that the Xxxxx Shareholders dispute any matter with respect thereto, then
all such matters (hereinafter referred to as the "Disputed Matters") shall be
submitted to arbitration in Jacksonville, Florida (the "Arbitration") within
fifteen (15) days after such notice unless the Xxxxx Shareholders and Intrepid
agree in writing to extend such fifteen (15) day period in an attempt to
negotiate a settlement of such Disputed Matters. The arbitrator (the
"Arbitrator") shall be any one of the nationally recognized independent
accounting firms which is on the Closing Date among the five largest such firms
(the "Big Five accounting firms") mutually agreed to by the Xxxxx Shareholders
and Intrepid. Any reference herein to the Big Five accounting firms shall be
deemed to include a reference to any member or employee thereof (who is a
certified public accountant) which any such firm may designate as the
Arbitrator on its behalf. If, within ten (10) days following the expiration of
the fifteen (15) day period referred to above or any extension thereof, the
Xxxxx Shareholders and Intrepid shall have failed to agree upon the selection
of the Arbitrator or any such Arbitrator
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selected by them shall not have agreed to perform the services called for
hereunder, the Arbitrator shall thereupon be selected in accordance with the
rules of the American Arbitration Association, with preference being given to
any one of the Big Five accounting firms or any member or employee thereof (who
is a certified public accountant) which or who may be willing to perform such
services, other than any such firm which is then employed by Xxxxx, any of the
Xxxxx Shareholders, Intrepid or any of their respective Affiliates. The
Arbitrator shall consider only the Disputed Matters, and the Arbitration shall
be conducted in accordance with the commercial arbitration rules of the
American Arbitration Association then in effect. The Arbitrator shall act
promptly to resolve all Disputed Matters, and the Arbitrator's decision with
respect to all Disputed Matters shall be final and binding upon the parties
hereto and shall not be appealable to any court. The costs and expenses of the
Arbitrator shall be shared 50% by the Xxxxx Shareholders and 50% by Intrepid.
2.6 POST-CLOSING PAYMENTS. If the Actual Equity (a) is greater
than the Target Equity, then Intrepid shall immediately pay to each Xxxxx
Shareholder his or its Pro Rata Amount of such excess in cash, (b) is less than
the Target Equity, then each of the Xxxxx Shareholders shall immediately pay
his or its Pro Rata Amount of such deficiency to Intrepid in cash, or (c) is
equal to the Target Equity, then no adjustment shall be made to the Purchase
Price hereunder; provided, however, that, in each such case, if there are any
Disputed Matters, any payment finally determined to be due either by agreement
or by Arbitration shall be made by the Xxxxx Shareholders or Intrepid, as the
case may be, within ten (10) days after such determination.
2.7 OPTION SECURITIES AND CONVERTIBLE SECURITIES. Upon the
consummation of the Transactions, each outstanding Option Security and each
Convertible Security of Xxxxx, if any, whether or not then exercisable for or
convertible into Xxxxx Common Stock or other Xxxxx securities, outstanding
immediately prior to the consummation of the Share Purchase shall be canceled
and retired and shall cease to exist, and the holder thereof shall not be
entitled to receive any consideration therefor.
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES OF THE XXXXX SHAREHOLDERS
Except as set forth in Section 10.7 hereof, the survival of and
liability for the representations and warranties contained in this Article 3
shall be governed solely by Article 10, and the remedies set forth in Article
10 shall be the sole remedies for any breach of such representations and
warranties. Each of the Xxxxx Shareholders, severally and not jointly, hereby
represents and warrants to Intrepid as follows:
3.1 ORGANIZATION AND BUSINESS; POWER AND AUTHORITY; EFFECT OF
TRANSACTION.
(a) Xxxxx and each of its Subsidiaries is a
corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization,
as the case may be, has all requisite power and authority (corporate
and otherwise) to own or hold under lease its properties and to
conduct its business as now conducted and is duly qualified and in
good standing as a foreign corporation in each
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other jurisdiction (as shown on Section 3.1(a) of the Xxxxx Disclosure
Schedule) in which the character of the property owned or leased by it
or the nature of its business or operations requires such
qualification, except for such qualifications the failure of which to
obtain, individually or in the aggregate, would not have a material
adverse effect on Xxxxx.
(b) Such Xxxxx Shareholder has all requisite power
and authority and has in full force and effect all Governmental
Authorizations and Private Authorizations necessary to enable such
Xxxxx Shareholder to execute and deliver, and to perform his or its
obligations under, this Agreement and each Collateral Document, if
any, executed or required to be executed by such Xxxxx Shareholder
pursuant hereto or thereto or to consummate the Transactions. This
Agreement has been duly executed and delivered by such Xxxxx
Shareholder and constitutes, and each Collateral Document, if any,
executed or required to be executed by such Xxxxx Shareholder pursuant
hereto or thereto or to consummate the Transactions, when executed and
delivered by such Xxxxx Shareholder and the other parties thereto,
will constitute legal, valid and binding obligations of such Xxxxx
Shareholder, enforceable against such Xxxxx Shareholder in accordance
with their respective terms, except as such enforceability may be
subject to bankruptcy, moratorium, insolvency, reorganization,
arrangement, voidable preference, fraudulent conveyance and other
similar laws relating to or affecting the rights of creditors and
except as the same may be subject to the effect of general principles
of equity.
(c) Except as set forth in Section 3.1(c) of the Xxxxx
Disclosure Schedule, to such Xxxxx Shareholder's knowledge, neither
the execution and delivery by such Xxxxx Shareholder of this Agreement
or any Collateral Document, if any, executed or required to be
executed by such Xxxxx Shareholder pursuant hereto or thereto, nor the
consummation of the Transactions, nor compliance with the terms,
conditions and provisions hereof or thereof by such Xxxxx Shareholder:
(i) will conflict with, or result in a breach or
violation of, or constitute a default under, any Organic
Document of Xxxxx or any of its Subsidiaries or any
Applicable Law, or will conflict with, or result in a breach
or violation of, or constitute a default under, or permit the
acceleration of any obligation or liability in, or but for
any requirement of the giving of notice or passage of time or
both would constitute such a conflict with, breach or
violation of, or default under, or permit any such
acceleration in, any Contractual Obligation of such Xxxxx
Shareholder, Xxxxx or any of Xxxxx'x Subsidiaries; or
(ii) will require such Xxxxx Shareholder, Xxxxx
or any of its Subsidiaries to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization.
(d) The Subsidiaries of Xxxxx are as set forth in Section
3.1(d) of the Xxxxx Disclosure Schedule.
3.2 TITLE TO SHARES. Such Xxxxx Shareholder owns the Shares set
forth opposite such Xxxxx Shareholder's name in Section 3.2 of the Xxxxx
Disclosure Schedule. Except as set forth
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in Section 3.2 of the Xxxxx Disclosure Schedule, such Xxxxx Shareholder owns
and has good and marketable title to the Shares as so set forth, free and clear
of all Liens.
3.3 XXXXX'X FINANCIAL AND OTHER INFORMATION. Xxxxx has heretofore
furnished to Intrepid copies of the financial statements of Xxxxx and its
Subsidiaries listed in Section 3.3 of the Xxxxx Disclosure Schedule (the "Xxxxx
Financial Statements"). The Xxxxx Financial Statements, including in each case
the notes thereto, have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered thereby, except as otherwise
noted therein or as set forth in Section 3.3 of the Xxxxx Disclosure Schedule,
and fairly present the financial condition and the results of operations and
cash flow of Xxxxx and its Subsidiaries in accordance with GAAP, on the bases
therein stated, as of the respective dates thereof, and for the respective
periods covered thereby subject, in the case of unaudited financial statements,
to normal nonmaterial year-end audit adjustments and accruals.
3.4 MATERIAL STATEMENTS AND OMISSIONS; ABSENCE OF EVENTS. To such
Xxxxx Shareholder's knowledge, neither any representation or warranty made by
such Xxxxx Shareholder contained in this Agreement or in any certificate,
document or other instrument furnished or to be furnished by such Xxxxx
Shareholder pursuant to the provisions hereof nor the Xxxxx Disclosure Schedule
contains or will contain any untrue statement of a material fact or omits or
will omit to state any material fact required to make any statement contained
herein or therein, in light of the circumstances under which they were made,
not misleading. Since the date of the most recent financial statements
constituting a part of the Xxxxx Financial Statements, except to the extent
specifically described in Section 3.4 of the Xxxxx Disclosure Schedule, there
has been no change with respect to Xxxxx and its Subsidiaries which has had, or
(so far as such Xxxxx Shareholder can now reasonably foresee) is reasonably
likely to have, a material adverse effect on Xxxxx. Since December 31, 1998,
there is no Event which has had, or (so far as such Xxxxx Shareholder can now
reasonably foresee) is reasonably likely to have, a material adverse effect on
Xxxxx, except to the extent specifically described in Section 3.4 of the Xxxxx
Disclosure Schedule. Such Xxxxx Shareholder is not aware of any impending or
contemplated Event that would cause any of the representations and warranties
made by such Xxxxx Shareholder in this Article not to be true, correct and
complete on the date of such Event as if made on that date.
3.5 TITLE TO PROPERTIES. Except for leasehold estates and related
easements and licenses, Xxxxx and its Subsidiaries do not own, directly or
indirectly, any real property. Xxxxx and its Subsidiaries have good,
indefeasible, marketable and insurable title to or valid leasehold interests in
their respective properties and assets, real or personal, tangible or
intangible, reflected in the balance sheet that is a part of the Xxxxx
Financial Statements (collectively, the "Xxxxx Assets"), which together
constitute all of the property, real and personal, tangible and intangible,
owned or leased by Xxxxx. All of the Xxxxx Assets are so owned, in each case,
free and clear of all Liens, except (i) Permitted Liens and (ii) Liens set
forth on Section 3.5 of the Xxxxx Disclosure Schedule (which Liens shall be
released prior to the consummation of the Share Purchase). Except for financing
statements evidencing Liens referred to in the immediately preceding sentence
(a true, accurate and complete list and description of which is set forth in
Section 3.5 of the Xxxxx Disclosure Schedule), no financing statements under
the Uniform Commercial Code and no other filing which names Xxxxx or any of its
Subsidiaries as debtor or which covers or purports to cover any of the Xxxxx
Assets is on file in any state or
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other jurisdiction, and neither Xxxxx nor any Subsidiary of Xxxxx has signed or
agreed to sign any such financing statement or filing or any agreement
authorizing any secured party thereunder to file any such financing statement
or filing. To such Xxxxx Shareholder's knowledge, there is no pending,
threatened or contemplated action to take by eminent domain or otherwise to
condemn any material part of any real property leased by Xxxxx or any of its
Subsidiaries.
3.6 RELATED TRANSACTIONS. Neither Xxxxx nor any Subsidiary of
Xxxxx is a party or subject to any Contractual Obligation relating to the
ownership or operation of the Xxxxx Assets or the conduct of the business of
Xxxxx and its Subsidiaries (the "Xxxxx Business") between Xxxxx or any of its
Subsidiaries and any of their respective officers, directors, shareholders,
employees or, to the knowledge of such Xxxxx Shareholder, any Affiliate of any
thereof, including any Contractual Obligation providing for the furnishing of
services to or by, providing for rental of property, real, personal or mixed,
to or from, or providing for the lending or borrowing of money to or from or
otherwise requiring payments to or from, any such Person, other than (a)
Employment Arrangements listed or described in Section 4.5 of the Xxxxx
Disclosure Schedule, (b) Contractual Obligations between Xxxxx or any of its
Subsidiaries and any of their respective directors, shareholders, officers,
employees or Affiliates of Xxxxx or any of the foregoing, which will be
terminated, at no cost or expense to Xxxxx or its Subsidiaries, prior to the
Closing Date, or (c) as specifically set forth in Section 3.6 of the Xxxxx
Disclosure Schedule.
3.7 INSURANCE. Xxxxx and its Subsidiaries maintain, with respect
to the Xxxxx Assets and the Xxxxx Business, policies of fire and extended
coverage and casualty, liability and other forms of insurance in such amounts
and against such risks and losses as are set forth in Section 3.7 of the Xxxxx
Disclosure Schedule.
3.8 EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. Except as
described in Section 3.8 of the Xxxxx Disclosure Schedule:
(a) Xxxxx (which for purposes of this Section shall
include any ERISA Affiliate) has never contributed or sponsored, and
has not at any time since its organization made any contribution to or
sponsored, any Plan or Benefit Arrangement which is subject to ERISA.
(b) Xxxxx is not and never has been a party to any
Multiemployer Plan or made contributions to any such Plan.
(c) Xxxxx does not maintain any Plan that provides
benefits described in Section 3(1) of ERISA, except as the provisions
of COBRA may apply, to any former employees or retirees of Xxxxx.
(d) The execution, delivery and performance by each
Xxxxx Shareholder of this Agreement and the Collateral Documents
executed or required to be executed pursuant hereto and thereto will
not involve any prohibited transaction within the meaning of ERISA or
Section 4975 of the Code.
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3.9 SOLVENCY. As of the execution and delivery of this Agreement,
Xxxxx and each of its Subsidiaries (other than Subsidiaries which are inactive
and have only intercompany liabilities) are, and immediately prior to and
immediately after giving effect to the consummation of the Share Purchase will
be, Solvent.
3.10 BANK ACCOUNTS, ETC. Section 3.10 of the Xxxxx Disclosure
Schedule contains a true, accurate and complete list as of the date hereof of
all banks, trust companies, savings and loan associations and brokerage firms
in which Xxxxx or any of its Subsidiaries has an account or a safe deposit box
and the names of all Persons authorized to draw thereon, to have access
thereto, or to authorize transactions therein, the names of all Persons, if
any, holding valid and subsisting powers of attorney from Xxxxx or any of its
Subsidiaries and a summary statement as to the terms thereof.
3.11 ORDINARY COURSE OF BUSINESS. Except (i) as may be described
in Section 3.11 of the Xxxxx Disclosure Schedule, (ii) as may be required or
expressly contemplated by the terms of this Agreement, or (iii) as may be
described in the Xxxxx Financial Statements, including the notes thereto, from
December 31, 1998 through the date hereof, Xxxxx and each of its Subsidiaries:
(a) have operated their respective businesses in all
material respects in the normal, usual and customary manner in the
ordinary and regular course of business, consistent with prior
practice;
(b) except in each case in the ordinary course of
business, consistent with prior practice, (i) have not incurred any
obligation or liability (fixed, contingent or otherwise), (ii) have
not sold or otherwise disposed of or contracted to sell or otherwise
dispose of any of its properties or assets, (iii) have not entered
into any individual commitment having a value in excess of $25,000,
and (iv)have not canceled any debts or claims;
(c) have not created or permitted to be created any Lien
on any of the Xxxxx Assets, except for Permitted Liens;
(d) have not made or committed to make any additions to
its property or any purchases of equipment;
(e) have not increased the schedule of compensation
payable or to become payable to any of the employees and consultants
of Xxxxx and its Subsidiaries (collectively, the "Xxxxx Employees")
other than nonmaterial increases in the ordinary course of business,
or otherwise materially altered, modified or changed the terms of
their employment;
(f) have not suffered any damage, destruction or loss
(whether or not covered by insurance) or any acquisition or taking of
property by any Authority that has had or is reasonably likely to have
a material adverse effect on Xxxxx;
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(g) have not waived any rights of material value without
fair and adequate consideration;
(h) have not experienced any work stoppage;
(i) except in the ordinary course of business, have not
entered into, amended or terminated any Lease, Governmental
Authorization, Private Authorization, Material Agreement or Employment
Arrangement, or any transaction, agreement or arrangement with any
Affiliate of Xxxxx; and
(j) have not made, paid or declared any Distribution
(except for any Distribution to Xxxxx by any of its Subsidiaries).
3.12 MATERIAL AND ADVERSE RESTRICTIONS. Neither Xxxxx nor any
Subsidiary of Xxxxx is a party to or subject to, nor is any of the Xxxxx Assets
subject to, any Applicable Law or Governmental Authorization (other than
Applicable Laws or Governmental Authorizations which affect similarly situated
businesses in Xxxxx'x industry generally), Contractual Obligation, Employment
Arrangement, Lease, Material Agreement, Private Authorization or any other
obligation or restriction of any kind or character, which now has or, as far as
such Xxxxx Shareholder can now reasonably foresee, individually or in the
aggregate, is reasonably likely to have, any material adverse effect on Xxxxx,
except as set forth in Section 3.12 of the Xxxxx Disclosure Schedule. Except as
set forth in Section 3.12 of the Xxxxx Disclosure Schedule, neither Xxxxx nor
any of its Subsidiaries is subject to regulation under the Investment Advisers
Act of 1940, as amended, or the Investment Company Act of 1940, as amended.
Xxxxx, each of its Subsidiaries and each of their respective employees which
are or who are required to be registered as a broker/dealer, an investment
adviser, a registered representative, an insurance agent or a sales Person (or
in a similar capacity) with any Authority or any Self-Regulatory Organization,
are duly registered as such. All federal, state and foreign registration
requirements have been complied with in all material respects and such
registrations as currently filed, and all periodic reports required to be filed
with respect thereto, are accurate and complete in all material respects.
3.13 BROKER OR FINDER. No Person assisted in or brought about the
negotiation of this Agreement or the Share Purchase in the capacity of broker,
agent or finder or in any similar capacity on behalf of Xxxxx or the Xxxxx
Shareholders.
3.14 CAPITAL STOCK. The authorized and outstanding capital stock
of Xxxxx is as set forth in Section 3.14 of the Xxxxx Disclosure Schedule. The
Shares constitute all of the outstanding capital stock of Xxxxx, and all of the
Shares have been duly authorized and validly issued, are fully paid and
nonassessable, are not subject to any preemptive or similar rights and are
owned of record and, to such Xxxxx Shareholder's knowledge, beneficially as
shown in Section 3.14 of the Xxxxx Disclosure Schedule. Except as set forth in
Section 3.14 of the Xxxxx Disclosure Schedule, Xxxxx has not granted or issued,
nor has Xxxxx agreed to grant or issue, any shares of its capital stock or any
Option Security or Convertible Security, and Xxxxx is not a party to or bound
by any agreement, put or commitment pursuant to which it is obligated to
purchase, redeem or otherwise acquire any shares of capital stock or any Option
Security or Convertible Security.
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3.15 QUALIFICATION OF THE XXXXX SHAREHOLDERS. Each of the Xxxxx
Shareholders: (a) is an "accredited investor" within the meaning of Regulation
D of the Securities Act and, upon the conversion of the Synagen Promissory
Note, the Xxxxxx Promissory Note and the Xxxxxxxxx Promissory Note, as the case
may be, will be acquiring shares of the common stock of Intrepid for such Xxxxx
Shareholder's own account and not with a view to, or for resale in connection
with, any distribution thereof; (b) understands and acknowledges that the
common stock of Intrepid to be issued upon the conversion of each of the
Synagen Promissory Note, the Xxxxxx Promissory Note and the Xxxxxxxxx
Promissory Note has not been registered under the Securities Act or any state
securities laws by reason of certain exemptions from the registration
provisions thereof which depend upon, among other things, the bona fide nature
of such Xxxxx Shareholder's investment intent as expressed herein; (c) is able
to bear the economic risk of an investment in the common stock of Intrepid and
has such knowledge and experience in financial and business matters that such
Xxxxx Shareholder is capable of evaluating the risks and merits of the common
stock of Intrepid; (d) has personally been provided with all information or
been given access to all information with respect to Intrepid which such Xxxxx
Shareholder believes might affect such Xxxxx Shareholder's decision whether to
effect the Transactions; and (e) understands and acknowledges that the common
stock of Intrepid will be "restricted securities" as that term is defined in
Rule 144 under the Securities Act and that the certificate or certificates
representing the common stock of Intrepid to issued upon the conversion of the
Synagen Promissory Note, the Xxxxxx Promissory Note or the Xxxxxxxxx Promissory
Note will bear a legend restricting transfer unless (i) the transfer is exempt
from the registration requirements under the Securities Act any applicable
state securities law and an opinion of counsel reasonably satisfactory to
Intrepid that such transfer is exempt therefrom is delivered to Intrepid or
(ii) the transfer is made pursuant to an effective registration statement under
the Securities Act and any applicable state securities law. In determining to
proceed with the transaction contemplated hereby, each of the Xxxxx
Shareholders has relied solely on the results of such Xxxxx Shareholder's own
independent investigation with respect to Intrepid and the common stock of
Intrepid, upon the representations, warranties, covenants and statements of
Intrepid set forth herein and in such Xxxxx Shareholder's own independent
investigation of the Intrepid Business. Each of the Xxxxx Shareholders
acknowledges that the representations, warranties, covenants and statements to
the Xxxxx Shareholders by Intrepid set forth herein constitute the sole and
exclusive representations, warranties, covenants and statements of Intrepid or
any of its officers, directors, stockholders or other Affiliates in connection
with the Transactions, and each of the Xxxxx Shareholders understands,
acknowledges and agrees that all other representations, warranties, covenants
and statements of any kind or nature, whether oral or contained in any writing
other than this Agreement and each of the Collateral Documents are specifically
disclaimed by Intrepid.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES OF
XXXXXX, SYNAGEN AND XXXXXXXXX
Except as set forth in Section 10.7 hereof, the survival of and
liability for the representations and warranties contained in this Article 4
shall be governed solely by Article 10, and the remedies set forth in Article
10 shall be the sole remedies for any breach of such
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representations and warranties. Each of Xxxxxx, Synagen and Xxxxxxxxx,
severally and not jointly, hereby represents and warrants to Intrepid as
follows:
4.1 COMPLIANCE WITH PRIVATE AUTHORIZATIONS. Section 4.1 of the
Xxxxx Disclosure Schedule sets forth a true, accurate and complete list and
description of each Private Authorization which individually is material to the
Xxxxx Assets or the Xxxxx Business. Xxxxx and its Subsidiaries have obtained
all Private Authorizations that are necessary for the ownership or operation of
the Xxxxx Assets or the conduct of the Xxxxx Business which, if not obtained
and maintained, would, individually or in the aggregate, be reasonably likely
to have a material adverse effect on Xxxxx. To such Xxxxx Shareholder's
knowledge, all of such Private Authorizations are valid and in good standing
and are in full force and effect, except for such exceptions as, individually
or in the aggregate, have not had and are not reasonably likely to have a
material adverse effect on Xxxxx. To such Xxxxx Shareholder's knowledge,
neither Xxxxx nor any of its Subsidiaries is in breach or violation of, or in
default in the performance, observance or fulfillment of, any such Private
Authorization, and no Event exists or has occurred which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any such Private
Authorization, except for such defaults, breaches or violations as,
individually or in the aggregate, have not had and will not have any material
adverse effect on Xxxxx. No such Private Authorization is the subject of any
pending or, to such Xxxxx Shareholder's knowledge, threatened, attack,
revocation or termination, except for such exceptions as, individually or in
the aggregate, have not had and are not reasonably likely to have a material
adverse effect on Xxxxx.
4.2 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE
LAW.
(a) To such Xxxxx Shareholder's knowledge, Section
4.2(a) of the Xxxxx Disclosure Schedule contains a true, complete and
accurate description of each Governmental Authorization that is
material to the ownership or operation of the Xxxxx Assets or the
conduct of the Xxxxx Business and that is required under Applicable
Law (i) to own and operate the Xxxxx Assets and conduct the Xxxxx
Business as currently conducted, all of which are in full force and
effect or (ii) that is necessary to permit Xxxxx to execute and
deliver this Agreement and to perform its obligations hereunder. Xxxxx
and its Subsidiaries have obtained all Governmental Authorizations
that are necessary for the ownership or operation of the Xxxxx Assets
or the conduct of the Xxxxx Business as now conducted and which, if
not obtained and maintained, would, individually or in the aggregate,
have a material adverse effect on Xxxxx. None of the Governmental
Authorizations listed in Section 4.2(a) of the Xxxxx Disclosure
Schedule is subject to any restriction or condition that would limit
in any material respect the ownership or operations of the Xxxxx
Assets or the conduct of the Xxxxx Business as currently conducted,
except for restrictions and conditions generally applicable to
Governmental Authorizations of such type. The Governmental
Authorizations listed in Section 4.2(a) of the Xxxxx Disclosure
Schedule are valid and in good standing, are in full force and effect
and, to such Xxxxx Shareholder's knowledge, are not impaired in any
material respect by any act or omission of Xxxxx, its Subsidiaries or
any of their respective officers, directors, employees or agents, and
the ownership and operation of the Xxxxx Assets and the conduct of the
Xxxxx Business are in accordance in all material respects with the
Governmental Authorizations. All material reports, forms and
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statements required to be filed by Xxxxx and its Subsidiaries with all
Authorities and Self-Regulatory Organizations with respect to the
Xxxxx Business have been filed and are true, complete and accurate in
all material respects. To such Xxxxx Shareholder's knowledge, no such
Governmental Authorization currently held by Xxxxx or any of its
Subsidiaries is the subject of any pending or, to such Xxxxx
Shareholder's knowledge, threatened challenge or proceeding to revoke
or terminate any such Governmental Authorization that, individually or
in the aggregate, if revoked or terminated, would have a material
adverse effect on Xxxxx. Such Xxxxx Shareholder has no reason to
believe that any such Governmental Authorization will not be renewed
in the name of Xxxxx or its Subsidiaries, as the case may be, by the
granting Authority in the ordinary course.
(b) To such Xxxxx Shareholder's knowledge, Xxxxx and its
Subsidiaries are in compliance with all Applicable Laws, except where
such non-compliance, individually or in the aggregate, has not had and
is not reasonably likely to have a material adverse effect on Xxxxx.
Except as set forth in Section 4.2(b) of the Xxxxx Disclosure
Schedule, there are no Legal Actions of any kind pending or, to the
knowledge of such Xxxxx Shareholder, threatened, at law, in equity or
before any Authority or Self-Regulatory Organization against Xxxxx or
its Subsidiaries. Such disclosed Legal Actions, if determined
adversely to Xxxxx or its Subsidiaries, individually or in the
aggregate, are not reasonably likely to have a material adverse effect
on Xxxxx.
(c) Except as set forth in Section 4.2(c) of the Xxxxx
Disclosure Schedule, to such Xxxxx Shareholder's knowledge, Xxxxx and
its Subsidiaries have not received any notification or communication
from any Authorities or Self-Regulatory Organizations (i) asserting
non-compliance with any of the Laws that such Authorities or
Self-Regulatory Organizations enforce, (ii) threatening to revoke or
condition the continuation of any Private Authorization or
Governmental Authorization (nor do any grounds for any of the
foregoing exist), (iii) requiring them (or any of their respective
directors or controlling Persons) to enter into a cease and desist
order, agreement, memorandum of understanding, censure or disciplinary
agreement (or requiring the board of directors thereof to adopt any
resolution or policy), or (iv) restricting or disqualifying their
respective activities (except for restrictions generally imposed by
disqualifying their respective activities) other than for restrictions
generally imposed by rule, regulation or administrative policy on
brokers or dealers generally.
(d) Other than periodic examinations by Self-Regulatory
Organizations in the ordinary course, such Xxxxx Shareholder is not
aware of any pending or threatened investigation, review or
disciplinary proceedings by any Authorities or Self-Regulatory
Organizations against Xxxxx or any Subsidiary of Xxxxx or any of their
respective officers, directors or employees.
(e) To such Xxxxx Shareholder's knowledge, neither
Xxxxx, nor its Subsidiaries, nor any of their respective employees is,
and, to such Xxxxx Shareholder's knowledge, none of Xxxxx'x Affiliates
or their respective employees are, subject to a "statutory
disqualification" (as defined in Section 3(a)(39) of the Exchange Act)
or subject to a disqualification that would be a basis for censure,
limitations on the activities, functions or operations of, or
suspension or revocation of the registration of any broker-
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dealer Affiliate as a broker-dealer, municipal securities dealer,
government securities broker or government securities dealer under
Section 15, Section 15B or Section 15C of the Exchange Act, and, to
such Xxxxx Shareholder's knowledge, there is no reasonable basis for,
or proceeding or investigation, whether formal or informal, or whether
preliminary or otherwise, that is reasonably likely to result in, any
such censure, limitations, suspension or revocation.
(f) To such Xxxxx Shareholder's knowledge, neither Xxxxx
nor any of its Subsidiaries is required to be registered as an
investment company, commodity trading advisor, commodity pool
operator, futures commission merchant, insurance agent or transfer
agent under any federal, state, local or foreign Law. To such Xxxxx
Shareholder's knowledge, neither Xxxxx nor any its Subsidiaries acts
as the "sponsor" of a "broker-dealer trading program", as such terms
are defined in rule 17a-23 under the Exchange Act.
(g) To such Xxxxx Shareholder's knowledge, in the conduct
of their respective businesses with respect to employee benefit plans
subject to Title I of ERISA, neither Xxxxx nor any of its Subsidiaries
has (i) breached any applicable fiduciary duty under Part 4 of Title I
of ERISA which would subject it to liability under Sections 405 or 409
of ERISA or (ii) engaged in a "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975(c) of the Code which
would subject it to liability or Taxes under Sections 409 or 502(I) of
ERISA or Section 4975(a) of the Code.
(h) Except as set forth in Section 4.2(c) of the Xxxxx
Disclosure Schedule, neither Xxxxx nor any of its Subsidiaries is
subject to any cease and desist, censure or other order issued by, or
a party to any written agreement, consent agreement, memorandum of
understanding or disciplinary agreement with, or a party to any
commitment letter or similar undertaking to, or subject to any order
or directive by, or a recipient of any supervisory letter from or
adopted any board resolutions at the request of any Authority or
Self-Regulatory Organization, or been advised by any Authority or
Self-Regulatory Organization that is considering issuing or requesting
any such agreement or other action, and such Xxxxx Shareholder has no
knowledge of any pending or threatened regulatory investigation.
(i) To such Xxxxx Shareholder's knowledge, except as set
forth in Section 4.2(i) of the Xxxxx Disclosure Schedule, Xxxxx and
its Subsidiaries have timely filed all reports, registrations and
statements, together with any amendments required to be made with
respect thereto, that were required to be filed under any applicable
law, regulation or rule, with (A) all applicable Authorities and (B)
any Self-Regulatory Organization (collectively, the "Xxxxx Reports").
To such Xxxxx Shareholder's knowledge, as of their respective dates,
the Xxxxx Reports complied with the applicable statutes, rules,
regulations and orders enforced or promulgated by the regulatory
authority with which they were filed.
4.3 INTANGIBLE ASSETS. Except as set forth in Section 4.3 of the Xxxxx
Disclosure Schedule, to such Xxxxx Shareholder's knowledge, no Intangible
Assets (except Governmental Authorizations, Private Authorizations and the
Intangible Assets so set forth) are required for the
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ownership or operation of the Xxxxx Assets or the conduct of the Xxxxx Business
as currently owned, operated and conducted, except for such exceptions to the
foregoing as, individually or in the aggregate, have not had and will not have
any material adverse effect on Xxxxx. Xxxxx and its Subsidiaries do not, to
such Xxxxx Shareholder's knowledge, wrongfully infringe upon or unlawfully use
any Intangible Assets owned or claimed by another, and, to such Xxxxx
Shareholder's knowledge, Xxxxx and its Subsidiaries have not received any
notice of any claim or infringement relating to any such Intangible Asset,
except for such exceptions to the foregoing which, individually or in the
aggregate, have not had and are not reasonably likely to have any material
adverse effect on Xxxxx.
4.4 TAX MATTERS.
(a) Xxxxx and each of its Subsidiaries have in
accordance with all Applicable Laws filed all Tax Returns which are
required to be filed, and have paid, or made adequate provision for
the payment of, all Taxes which have or may become due and payable
pursuant to said Tax Returns and all other governmental charges and
assessments received to date and which are now due and payable other
than those Taxes being contested in good faith for which adequate
provision has been made on the most recent balance sheet forming a
part of the Xxxxx Financial Statements. The Tax Returns of Xxxxx and
its Subsidiaries have been prepared in all material respects in
accordance with all Applicable Laws. All Taxes which Xxxxx and its
Subsidiaries are required by law to withhold and collect have been
duly withheld and collected, and have been paid over, in a timely
manner, to the proper Authorities to the extent due and payable.
Neither Xxxxx nor any of its Subsidiaries has executed any waiver to
extend, or otherwise taken or failed to take any action that would
have the effect of extending, the applicable statute of limitations
respect of any Tax liabilities of Xxxxx or its Subsidiaries for the
fiscal years prior to and including the most recent fiscal year.
Adequate provision has been made on the most recent balance sheet
forming a part of the Xxxxx Financial Statements for all Taxes accrued
through the date of such balance sheet of any kind, including interest
and penalties in respect thereof, whether disputed or not, and whether
past, current or deferred, accrued or unaccrued, fixed, contingent,
absolute or otherwise, and there are, to such Xxxxx Shareholder's
knowledge, no past transactions or matters which are reasonably likely
to result in additional Taxes of a material nature to Xxxxx for which
an adequate reserve has not been provided on such balance sheet.
Niether Xxxxx nor any of its Subsidiaries is a "consenting
corporation" within the meaning of Section 341(f) of the Code. To such
Xxxxx Shareholder's knowledge, Xxxxx and its Subsidiaries have at all
times been taxable as Subchapter C corporations under the Code, and
have never been members of any consolidated group for Tax purposes,
except as otherwise set forth in Section 4.4(a) of the Xxxxx
Disclosure Schedule. Neither Xxxxx nor any of its Subsidiaries is a
party to any tax sharing agreement or arrangement.
(b) All record and beneficial holders of Xxxxx Common
Stock are "United States persons" within the meaning of Section
7701(a)(30) of the Code.
4.5 EMPLOYMENT AND CONSULTING ARRANGEMENTS. Section 4.5 of the
Xxxxx Disclosure Schedule contains a true, accurate and complete list of all
Xxxxx Employees, together with each such Person's title or the capacity in
which such Person is employed or retained and
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each such Person's compensation. Except as described in Section 4.5 of the
Xxxxx Disclosure Schedule, all Xxxxx Employees are employed "at will", and
neither Xxxxx nor any Subsidiary of Xxxxx has any obligation or liability,
contingent or otherwise, under any Employment Arrangement with any Xxxxx
Employee. Except as described in Section 4.5 of the Xxxxx Disclosure Schedule,
to such Xxxxx Shareholder's knowledge, (a) none of the Xxxxx Employees is now,
or since its organization has been, represented by any labor union or other
employee collective bargaining organization, and neither Xxxxx nor any
Subsidiary of Xxxxx is or ever has been a party to any labor or other
collective bargaining agreement with respect to any of the Xxxxx Employees, (b)
there are no pending grievances, disputes or controversies with any union or
any other employee or collective bargaining organization of such employees, or
threats of strikes, work stoppages or slowdowns or any pending demands for
collective bargaining by any such union or other organization, (c) neither
Xxxxx nor any of it Subsidiaries is now, or has since its organization been,
subject to or involved in or threatened with, any union elections, petitions
therefor or other organizational or recruiting activities, in each case with
respect to the Xxxxx Employees, and (d) none of the Xxxxx Employees has
notified Xxxxx or any Subsidiary of Xxxxx that such Person does not intend to
continue employment with Xxxxx or such Subsidiary or with Intrepid following
the consummation of the Share Purchase. To such Xxxxx Shareholder's knowledge,
Xxxxx and its Subsidiaries have performed in all material respects all
obligations required to be performed under all Employment Arrangements and are
not in material breach or violation of, or in material default or arrears
under, any of the terms, provisions or conditions thereof.
4.6 MATERIAL AGREEMENTS. Listed on Section 4.6 of the Xxxxx
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the Xxxxx Assets or the conduct of the Xxxxx Business or to which
Xxxxx or any of its Subsidiaries is a party or to which it is bound or which
any of the Xxxxx Assets is subject. True, accurate and complete copies of each
of such Material Agreements have been made available by Xxxxx to Intrepid, and
Xxxxx has provided Intrepid with photocopies of all such Material Agreements
requested by Intrepid. To such Xxxxx Shareholder's knowledge, all of such
Material Agreements are valid, binding and legally enforceable obligations of
Xxxxx or its Subsidiaries, as the case may be, and all other parties thereto,
except as such enforceability may be limited by bankruptcy, moratorium,
insolvency and similar laws affecting the rights and remedies of creditors and
obligations of debtors generally and by general principles of equity. To such
Xxxxx Shareholder's knowledge, neither Xxxxx nor its Subsidiaries, as the case
may be, nor any other party thereto, has failed to comply with all of the
material terms and conditions of each such Material Agreement or has done or
performed, or failed to do or perform (and no Claim is pending or threatened in
writing to the effect that Xxxxx or its Subsidiaries, as the case may be, has
not so complied, done and performed or failed to do and perform) any act which
would invalidate or provide grounds for the other party thereto to terminate
(with or without notice, passage of time or both) such Material Agreement or
impair the rights or benefits, or increase the costs, of Xxxxx or its
Subsidiaries under any such Material Agreements, except for such
non-compliance, acts or omissions that, individually or in the aggregate, have
not had and will not have a material adverse effect on Xxxxx. Except as set
forth in Section 4.6 of the Xxxxx Disclosure Schedule, neither Xxxxx nor any of
its Subsidiaries extends credit to any of its clients or customers.
4.7 ENVIRONMENTAL MATTERS. Except as set forth in Section 4.7 of
the Xxxxx Disclosure Schedule and except for such non-compliance, failures and
liabilities which have not
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had and are not reasonably likely to have a material adverse effect on Xxxxx,
to such Xxxxx Shareholder's knowledge:
(a) Xxxxx and each of its Subsidiaries (i) have complied
with the Environmental, Health and Safety Laws in all material
respects, and no action, suit, proceeding, hearing, investigation,
charge, complaint, claim, demand or notice has been filed or commenced
against any of them alleging any such failure to comply, (ii) have
obtained and has at all times been and is in substantial compliance
with all of the terms and conditions of all Governmental
Authorizations and training which are required under any of the
Environmental, Health and Safety Laws, and (iii) have complied in all
material respects with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations,
schedules and timetables which are contained in the Environmental,
Health and Safety Laws; and
(b) Xxxxx and each of its Subsidiaries have no material
liability, and Xxxxx and each of its Subsidiaries and their respective
predecessors have not handled or disposed of any substance, arranged
for the disposal of any substance, exposed any employee or other
individual to any substance or condition, or owned or operated any
property or facility in any manner that could give rise to any
material liability, for contamination or damage to any site, location
or body of water (surface or subsurface), for any illness of or
personal injury to any employee or other individual, or for any reason
under any Environmental, Health and Safety Law.
4.8 YEAR 2000 COMPLIANCE. To such Xxxxx Shareholder's knowledge
(without inquiry or independent investigation), the software and hardware
operated by Xxxxx are capable of providing uninterrupted millennium
functionality to record, store, process and present calendar dates falling on
or after January 1, 2000 and date-dependent data in substantially the same
manner and with the same functionality as such software records, stores,
processes and presents such calendar dates and date-dependent data as of the
date hereof.
ARTICLE 5.
REPRESENTATIONS AND WARRANTIES OF XXXXXX
Except as set forth in Section 10.7 hereof, the survival of and
liability for the representations and warranties contained in this Article 5
shall be governed solely by Article 10, and the remedies set forth in Article
10 shall be the sole remedies for any breach of such representations and
warranties. Xxxxxx hereby represents and warrants to Intrepid as follows:
5.1 COMPLIANCE WITH PRIVATE AUTHORIZATIONS. Section 4.1 of the
Xxxxx Disclosure Schedule sets forth a true, accurate and complete list and
description of each Private Authorization which individually is material to the
Xxxxx Assets or the Xxxxx Business. Xxxxx and its Subsidiaries have obtained
all Private Authorizations that are necessary for the ownership or operation of
the Xxxxx Assets or the conduct of the Xxxxx Business which, if not obtained
and maintained, would, individually or in the aggregate, be reasonably likely
to have a material adverse effect on Xxxxx. All of such Private Authorizations
are valid and in good standing and are in full force and effect, except for
such exceptions as, individually or in the aggregate, have
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not had and are not reasonably likely to have a material adverse effect on
Xxxxx. Neither Xxxxx nor any of its Subsidiaries is in breach or violation of,
or in default in the performance, observance or fulfillment of, any such
Private Authorization, and no Event exists or has occurred which constitutes,
or but for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any such Private
Authorization, except for such defaults, breaches or violations as,
individually or in the aggregate, have not had and will not have any material
adverse effect on Xxxxx. No such Private Authorization is the subject of any
pending or, to Xxxxxx'x knowledge, threatened, attack, revocation or
termination, except for such exceptions as, individually or in the aggregate,
have not had and are not reasonably likely to have a material adverse effect on
Xxxxx.
5.2 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE
LAW.
(a) Section 4.2(a) of the Xxxxx Disclosure Schedule
contains a true, complete and accurate description of each
Governmental Authorization that is material to the ownership or
operation of the Xxxxx Assets or the conduct of the Xxxxx Business and
that is required under Applicable Law (i) to own and operate the Xxxxx
Assets and conduct the Xxxxx Business as currently conducted, all of
which are in full force and effect or (ii) that is necessary to permit
Xxxxx to execute and deliver this Agreement and to perform its
obligations hereunder. Xxxxx and its Subsidiaries have obtained all
Governmental Authorizations that are necessary for the ownership or
operation of the Xxxxx Assets or the conduct of the Xxxxx Business as
now conducted and which, if not obtained and maintained, would,
individually or in the aggregate, have a material adverse effect on
Xxxxx. None of the Governmental Authorizations listed in Section
4.2(a) of the Xxxxx Disclosure Schedule is subject to any restriction
or condition that would limit in any material respect the ownership or
operations of the Xxxxx Assets or the conduct of the Xxxxx Business as
currently conducted, except for restrictions and conditions generally
applicable to Governmental Authorizations of such type. The
Governmental Authorizations listed in Section 4.2(a) of the Xxxxx
Disclosure Schedule are valid and in good standing, are in full force
and effect and are not impaired in any material respect by any act or
omission of Xxxxx, its Subsidiaries or any of their respective
officers, directors, employees or agents, and the ownership and
operation of the Xxxxx Assets and the conduct of the Xxxxx Business
are in accordance in all material respects with the Governmental
Authorizations. All material reports, forms and statements required to
be filed by Xxxxx and its Subsidiaries with all Authorities and
Self-Regulatory Organizations with respect to the Xxxxx Business have
been filed and are true, complete and accurate in all material
respects. No such Governmental Authorization currently held by Xxxxx
or any of its Subsidiaries is the subject of any pending or, to
Xxxxxx'x knowledge, threatened challenge or proceeding to revoke or
terminate any such Governmental Authorization that, individually or in
the aggregate, if revoked or terminated, would have a material adverse
effect on Xxxxx. Xxxxxx has no reason to believe that any such
Governmental Authorization will not be renewed in the name of Xxxxx or
its Subsidiaries, as the case may be, by the granting Authority in the
ordinary course.
(b) Xxxxx and its Subsidiaries are in compliance with
all Applicable Laws, except where such non-compliance, individually or
in the aggregate, has not had and is
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not reasonably likely to have a material adverse effect on Xxxxx.
Except as set forth in Section 4.2(b) of the Xxxxx Disclosure
Schedule, there are no Legal Actions of any kind pending or, to
Xxxxxx'x knowledge, threatened, at law, in equity or before any
Authority or Self-Regulatory Organization against Xxxxx or its
Subsidiaries. Such disclosed Legal Actions, if determined adversely to
Xxxxx or its Subsidiaries, individually or in the aggregate, are not
reasonably likely to have a material adverse effect on Xxxxx.
(c) Except as set forth in Section 4.2(c) of the Xxxxx
Disclosure Schedule, Xxxxx and its Subsidiaries have not received any
notification or communication from any Authorities or Self-Regulatory
Organizations (i) asserting non-compliance with any of the Laws that
such Authorities or Self-Regulatory Organizations enforce, (ii)
threatening to revoke or condition the continuation of any Private
Authorization or Governmental Authorization (nor do any grounds for
any of the foregoing exist), (iii) requiring them (or any of their
respective directors or controlling Persons) to enter into a cease and
desist order, agreement, memorandum of understanding, censure or
disciplinary agreement (or requiring the board of directors thereof to
adopt any resolution or policy), or (iv) restricting or disqualifying
their respective activities (except for restrictions generally imposed
by disqualifying their respective activities) other than for
restrictions generally imposed by rule, regulation or administrative
policy on brokers or dealers generally.
(d) Other than periodic examinations by Self-Regulatory
Organizations in the ordinary course, Xxxxxx is not aware of any
pending or threatened investigation, review or disciplinary
proceedings by any Authorities or Self-Regulatory Organizations
against Xxxxx or any Subsidiary of Xxxxx or any of their respective
officers, directors or employees.
(e) Neither Xxxxx, nor its Subsidiaries, nor any of
their respective employees is, and, to Xxxxxx'x knowledge, none of
Xxxxx'x Affiliates or their respective employees are, subject to a
"statutory disqualification" (as defined in Section 3(a)(39) of the
Exchange Act) or subject to a disqualification that would be a basis
for censure, limitations on the activities, functions or operations
of, or suspension or revocation of the registration of any
broker-dealer Affiliate as a broker-dealer, municipal securities
dealer, government securities broker or government securities dealer
under Section 15, Section 15B or Section 15C of the Exchange Act, and
there is no reasonable basis for, or proceeding or investigation,
whether formal or informal, or whether preliminary or otherwise, that
is reasonably likely to result in, any such censure, limitations,
suspension or revocation.
(f) Neither Xxxxx nor any of its Subsidiaries is
required to be registered as an investment company, commodity trading
advisor, commodity pool operator, futures commission merchant,
insurance agent or transfer agent under any federal, state, local or
foreign Law. Neither Xxxxx nor any its Subsidiaries acts as the
"sponsor" of a "broker-dealer trading program", as such terms are
defined in rule 17a-23 under the Exchange Act.
(g) To Xxxxxx'x knowledge, in the conduct of their
respective businesses with respect to employee benefit plans subject
to Title I of ERISA, neither Xxxxx nor any of
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its Subsidiaries has (i) breached any applicable fiduciary duty under
Part 4 of Title I of ERISA which would subject it to liability under
Sections 405 or 409 of ERISA or (ii) engaged in a "prohibited
transaction" within the meaning of Section 406 of ERISA or Section
4975(c) of the Code which would subject it to liability or Taxes under
Sections 409 or 502(I) of ERISA or Section 4975(a) of the Code.
(h) Except as set forth in Section 4.2(c) of the Xxxxx
Disclosure Schedule, neither Xxxxx nor any of its Subsidiaries is
subject to any cease and desist, censure or other order issued by, or a
party to any written agreement, consent agreement, memorandum of
understanding or disciplinary agreement with, or a party to any
commitment letter or similar undertaking to, or subject to any order or
directive by, or a recipient of any supervisory letter from or adopted
any board resolutions at the request of any Authority or
Self-Regulatory Organization, or been advised by any Authority or
Self-Regulatory Organization that is considering issuing or requesting
any such agreement or other action, and Xxxxxx has no knowledge of any
pending or threatened regulatory investigation.
(i) Except as set forth in Section 4.2(i) of the Xxxxx
Disclosure Schedule, Xxxxx and its Subsidiaries have timely filed all
Xxxxx Reports. To Xxxxxx'x knowledge, as of their respective dates, the
Xxxxx Reports complied with the applicable statutes, rules, regulations
and orders enforced or promulgated by the regulatory authority with
which they were filed.
5.3 INTANGIBLE ASSETS. Except as set forth in Section 4.3 of the
Xxxxx Disclosure Schedule, no Intangible Assets (except Governmental
Authorizations, Private Authorizations and the Intangible Assets so set forth)
are required for the ownership or operation of the Xxxxx Assets or the conduct
of the Xxxxx Business as currently owned, operated and conducted, except for
such exceptions to the foregoing as, individually or in the aggregate, have not
had and will not have any material adverse effect on Xxxxx. Xxxxx and its
Subsidiaries do not, to Xxxxxx'x knowledge, wrongfully infringe upon or
unlawfully use any Intangible Assets owned or claimed by another, and Xxxxx and
its Subsidiaries have not received any notice of any claim or infringement
relating to any such Intangible Asset, except for such exceptions to the
foregoing which, individually or in the aggregate, have not had and are not
reasonably likely to have any material adverse effect on Xxxxx.
5.4 TAX MATTERS.
(a) Xxxxx and each of its Subsidiaries have in
accordance with all Applicable Laws filed all Tax Returns which are
required to be filed, and have paid, or made adequate provision for
the payment of, all Taxes which have or may become due and payable
pursuant to said Tax Returns and all other governmental charges and
assessments received to date and which are now due and payable other
than those Taxes being contested in good faith for which adequate
provision has been made on the most recent balance sheet forming a
part of the Xxxxx Financial Statements. The Tax Returns of Xxxxx and
its Subsidiaries have been prepared in all material respects in
accordance with all Applicable Laws. All Taxes which Xxxxx and its
Subsidiaries are required by law to withhold and collect have been
duly withheld and collected, and have been paid over, in a
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timely manner, to the proper Authorities to the extent due and
payable. Neither Xxxxx nor any of its Subsidiaries has executed any
waiver to extend, or otherwise taken or failed to take any action that
would have the effect of extending, the applicable statute of
limitations respect of any Tax liabilities of Xxxxx or its
Subsidiaries for the fiscal years prior to and including the most
recent fiscal year. Adequate provision has been made on the most
recent balance sheet forming a part of the Xxxxx Financial Statements
for all Taxes accrued through the date of such balance sheet of any
kind, including interest and penalties in respect thereof, whether
disputed or not, and whether past, current or deferred, accrued or
unaccrued, fixed, contingent, absolute or otherwise, and there are, to
Xxxxxx'x knowledge, no past transactions or matters which are
reasonably likely to result in additional Taxes of a material nature
to Xxxxx for which an adequate reserve has not been provided on such
balance sheet. Niether Xxxxx nor any of its Subsidiaries is a
"consenting corporation" within the meaning of Section 341(f) of the
Code. Xxxxx and its Subsidiaries have at all times been taxable as
Subchapter C corporations under the Code, and have never been members
of any consolidated group for Tax purposes, except as otherwise set
forth in Section 4.4(a) of the Xxxxx Disclosure Schedule. Neither
Xxxxx nor any of its Subsidiaries is a party to any tax sharing
agreement or arrangement.
(b) All record and beneficial holders of Xxxxx Common
Stock are "United States persons" within the meaning of Section
7701(a)(30) of the Code.
5.5 EMPLOYMENT AND CONSULTING ARRANGEMENTS. Section 4.5 of the
Xxxxx Disclosure Schedule contains a true, accurate and complete list of all
Xxxxx Employees, together with each such Person's title or the capacity in
which such Person is employed or retained and each such Person's compensation.
Except as described in Section 4.5 of the Xxxxx Disclosure Schedule, all Xxxxx
Employees are employed "at will", and neither Xxxxx nor any Subsidiary of Xxxxx
has any obligation or liability, contingent or otherwise, under any Employment
Arrangement with any Xxxxx Employee. Except as described in Section 4.5 of the
Xxxxx Disclosure Schedule, (a) none of the Xxxxx Employees is now, or since its
organization has been, represented by any labor union or other employee
collective bargaining organization, and neither Xxxxx nor any Subsidiary of
Xxxxx is or ever has been a party to any labor or other collective bargaining
agreement with respect to any of the Xxxxx Employees, (b) there are no pending
grievances, disputes or controversies with any union or any other employee or
collective bargaining organization of such employees, or threats of strikes,
work stoppages or slowdowns or any pending demands for collective bargaining by
any such union or other organization, (c) neither Xxxxx nor any of it
Subsidiaries is now, or has since its organization been, subject to or involved
in or threatened with, any union elections, petitions therefor or other
organizational or recruiting activities, in each case with respect to the Xxxxx
Employees, and (d) none of the Xxxxx Employees has notified Xxxxx or any
Subsidiary of Xxxxx that such Person does not intend to continue employment
with Xxxxx or such Subsidiary or with Intrepid following the consummation of
the Share Purchase. Xxxxx and its Subsidiaries have performed in all material
respects all obligations required to be performed under all Employment
Arrangements and are not in material breach or violation of, or in material
default or arrears under, any of the terms, provisions or conditions thereof.
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5.6 MATERIAL AGREEMENTS. Listed on Section 4.6 of the Xxxxx
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the Xxxxx Assets or the conduct of the Xxxxx Business or to which
Xxxxx or any of its Subsidiaries is a party or to which it is bound or which
any of the Xxxxx Assets is subject. True, accurate and complete copies of each
of such Material Agreements have been made available by Xxxxx to Intrepid, and
Xxxxx has provided Intrepid with photocopies of all such Material Agreements
requested by Intrepid. All of such Material Agreements are valid, binding and
legally enforceable obligations of Xxxxx or its Subsidiaries, as the case may
be, and all other parties thereto, except as such enforceability may be limited
by bankruptcy, moratorium, insolvency and similar laws affecting the rights and
remedies of creditors and obligations of debtors generally and by general
principles of equity. Neither Xxxxx nor its Subsidiaries, as the case may be,
nor, to Xxxxxx'x knowledge, any other party thereto, has failed to comply with
the material terms and conditions of each such Material Agreement or has done
or performed, or failed to do or perform (and no Claim is pending or threatened
in writing to the effect that Xxxxx or its Subsidiaries, as the case may be,
has not so complied, done and performed or failed to do and perform) any act
which would invalidate or provide grounds for the other party thereto to
terminate (with or without notice, passage of time or both) such Material
Agreement or impair the rights or benefits, or increase the costs, of Xxxxx or
its Subsidiaries under any such Material Agreements, except for such
non-compliance, acts or omissions that, individually or in the aggregate, have
not had and will not have a material adverse effect on Xxxxx. Neither Xxxxx nor
any of its Subsidiaries extends credit to any of its clients or customers.
5.7 ENVIRONMENTAL MATTERS. Except as set forth in Section 4.7 of
the Xxxxx Disclosure Schedule and except for such non-compliance, failures and
liabilities which have not had and are not reasonably likely to have a material
adverse effect on Xxxxx, to Xxxxxx'x knowledge:
(a) Xxxxx and each of its Subsidiaries (i) have complied
with the Environmental, Health and Safety Laws in all material
respects, and no action, suit, proceeding, hearing, investigation,
charge, complaint, claim, demand or notice has been filed or commenced
against any of them alleging any such failure to comply, (ii) have
obtained and has at all times been and is in substantial compliance
with all of the terms and conditions of all Governmental
Authorizations and training which are required under any of the
Environmental, Health and Safety Laws, and (iii) have complied in all
material respects with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations,
schedules and timetables which are contained in the Environmental,
Health and Safety Laws; and
(b) Xxxxx and each of its Subsidiaries have no material
liability, and Xxxxx and each of its Subsidiaries and their respective
predecessors have not handled or disposed of any substance, arranged
for the disposal of any substance, exposed any employee or other
individual to any substance or condition, or owned or operated any
property or facility in any manner that could give rise to any
material liability, for contamination or damage to any site, location
or body of water (surface or subsurface), for any illness of or
personal injury to any employee or other individual, or for any reason
under any Environmental, Health and Safety Law.
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5.8 YEAR 2000 COMPLIANCE. To Xxxxxx'x knowledge, the software and
hardware operated by Xxxxx are capable of providing uninterrupted millennium
functionality to record, store, process and present calendar dates falling on
or after January 1, 2000 and date-dependent data in substantially the same
manner and with the same functionality as such software records, stores,
processes and presents such calendar dates and date-dependent data as of the
date hereof.
ARTICLE 6.
REPRESENTATIONS AND WARRANTIES OF INTREPID
Except as set forth in Section 10.7 hereof, the survival of and
liability for the representations and warranties contained in this Article 6
shall be governed solely by Article 10, and the remedies set forth in Article
10 shall be the sole remedies for any breach of such representations and
warranties. Intrepid hereby represents and warrants to the Xxxxx Shareholders
as follows:
6.1 ORGANIZATION AND BUSINESS; POWER AND AUTHORITY; EFFECT OF
TRANSACTION.
(a) Intrepid and each of its Subsidiaries is a
corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization,
as the case may be, has all requisite power and authority (corporate
and otherwise) to own or hold under lease its properties and to
conduct its business as now conducted and is duly qualified and in
good standing as a foreign corporation in each other jurisdiction in
which the character of the property owned or leased by it or the
nature of its business or operations requires such qualification,
except for such qualifications the failure of which to obtain,
individually or in the aggregate, would not have a material adverse
effect on Intrepid.
(b) Intrepid has all requisite power and authority
(corporate and otherwise) and has in full force and effect all
Governmental Authorizations and Private Authorizations necessary to
enable it to execute and deliver, and to perform its obligations
under, this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto or to
consummate the Transactions; and the execution, delivery and
performance of this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto have been
duly authorized by all requisite corporate or other action on the part
of Intrepid. This Agreement has been duly executed and delivered by
Intrepid and constitutes, and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto or to
consummate the Transactions, when executed and delivered by Intrepid
and the other parties thereto, will constitute legal, valid and
binding obligations of Intrepid, enforceable against Intrepid in
accordance with their respective terms, except as such enforceability
may be subject to bankruptcy, moratorium, insolvency, reorganization,
arrangement, voidable preference, fraudulent conveyance and other
similar laws relating to or affecting the rights of creditors and
except as the same may be subject to the effect of general principles
of equity.
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(c) Except as set forth in Section 6.1(c) of the
Intrepid Disclosure Schedule, neither the execution and delivery by
Intrepid of this Agreement or any Collateral Document executed or
required to be executed by it pursuant hereto or thereto, nor the
consummation of the Transactions, nor compliance with the terms,
conditions and provisions hereof or thereof by Intrepid:
(i) will conflict with, or result in a breach
or violation of, or constitute a default under, any Organic
Document of Intrepid or any of its Subsidiaries or any
Applicable Law, or will conflict with, or result in a breach
or violation of, or constitute a default under, or permit the
acceleration of any obligation or liability in, or but for
any requirement of giving of notice or passage of time or
both would constitute such a conflict with, breach or
violation of, or default under, or permit any such
acceleration in, any Contractual Obligation of Intrepid or
any of its Subsidiaries; or
(ii) will require Intrepid or any of its
Subsidiaries to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization.
(d) The Subsidiaries of Intrepid are (i) Intrepid Asset
Management, Inc., a Florida corporation, (ii) Capital Research
Corporation, a Florida corporation, and (iii) Enviroq Corporation, a
Delaware corporation. Enviroq owns 50% of the outstanding capital
stock and has voting control of Sprayroq Corporation, a Delaware
corporation ("Sprayroq"). Each of Intrepid's Subsidiaries other than
Sprayroq is wholly owned.
6.2 INTREPID'S FINANCIAL AND OTHER INFORMATION. Intrepid has
heretofore furnished to the Xxxxx Shareholders copies of the financial
statements of Intrepid (collectively, the "Intrepid Financial Statements")
included in Intrepid's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1998 and in Intrepid's Quarterly Report on Form 10-QSB for the
quarter ended March 31, 1999 (the "Intrepid SEC Reports"). The Intrepid
Financial Statements, including in each case the notes thereto, have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods covered thereby, except as otherwise noted therein or as set forth in
Section 6.2 of the Intrepid Disclosure Schedule or in the Intrepid SEC Reports,
and fairly present the financial condition and the results of operations and
cash flow of Intrepid and its Subsidiaries in accordance with GAAP, on the
bases therein stated, as of the respective dates thereof, and for the
respective periods covered thereby subject, in the case of unaudited financial
statements, to normal nonmaterial year-end audit adjustments and accruals.
6.3 MATERIAL STATEMENTS AND OMISSIONS; ABSENCE OF EVENTS. Neither
any representation or warranty made by Intrepid contained in this Agreement or
in any certificate, document or other instrument furnished or to be furnished
by Intrepid pursuant to the provisions hereof, nor the Intrepid Disclosure
Schedule, contains or will contain any untrue statement of a material fact or
omits or will omit to state any material fact required to make any statement
contained herein or therein, in light of the circumstances under which they
were made, not misleading. Since the date of the most recent financial
statements constituting a part of the Intrepid Financial Statements, there has
been no change with respect to Intrepid and its Subsidiaries which has had, or
(so far as Intrepid can now reasonably foresee) is reasonably likely to have, a
material adverse effect on Intrepid. Since December 31, 1998, there is no Event
known to Intrepid which has had, or (so far as Intrepid can now reasonably
foresee) is reasonably likely to have, a material adverse effect on Intrepid.
Intrepid is not aware of any impending or contemplated Event that would cause
any of the representations and warranties made by Intrepid in this Article 6
not to be true, correct and complete on the date of such Event as if made on
that date.
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6.4 TITLE TO PROPERTIES. Intrepid and its Subsidiaries have good,
indefeasible, marketable and insurable title to or valid leasehold interests in
their respective properties and assets, real or personal, tangible or
intangible, reflected in the balance sheet that is a part of the Intrepid
Financial Statements (collectively, the "Intrepid Assets"), which together
constitute all of the property, real and personal, tangible and intangible,
owned or leased by Intrepid. To Intrepid's knowledge, there is no pending,
threatened or contemplated action to take by eminent domain or otherwise to
condemn any material part of any Real Property of Intrepid or its Subsidiaries.
6.5 COMPLIANCE WITH PRIVATE AUTHORIZATIONS. Section 6.5 of the
Intrepid Disclosure Schedule sets forth a true, accurate and complete list and
description of each Private Authorization which individually is material to the
Intrepid Assets or the business of Intrepid and its Subsidiaries (the "Intrepid
Business"). Intrepid and its Subsidiaries have obtained all Private
Authorizations that are necessary for the ownership or operation of the
Intrepid Assets or the conduct of the Intrepid Business which, if not obtained
and maintained, would, individually or in the aggregate, be reasonably likely
to have a material adverse effect on Intrepid. To Intrepid's knowledge, all of
such Private Authorizations are valid and in good standing and are in full
force and effect, except for such exceptions as, individually or in the
aggregate, have not had and are not reasonably likely to have a material
adverse effect on Intrepid. To Intrepid's knowledge, neither it nor any of its
Subsidiaries is in breach or violation of, or in default in the performance,
observance or fulfillment of, any such Private Authorization, and no Event
exists or has occurred which constitutes, or but for any requirement of giving
of notice or passage of time or both would constitute, such a breach, violation
or default, under any such Private Authorization, except for such defaults,
breaches or violations as, individually or in the aggregate, have not had and
will not have any material adverse effect on Intrepid. No such Private
Authorization is the subject of any pending or, to Intrepid's knowledge,
threatened, attack, revocation or termination, except for such exceptions as,
individually or in the aggregate, have not had and are not reasonably likely to
have a material adverse effect on Intrepid.
6.6 COMPLIANCE WITH GOVERNMENTAL AUTHORIZATIONS AND APPLICABLE
LAW.
(a) To Intrepid's knowledge, Section 6.6(a) of the
Intrepid Disclosure Schedule contains a true, complete and accurate
description of each Governmental Authorization that is material to the
ownership or operation of the Intrepid Assets or the conduct of the
Intrepid Business and that is required under Applicable Law (i) to own
and operate the Intrepid Assets and conduct the Intrepid Business as
currently conducted, all of which are in full force and effect or (ii)
that is necessary to permit Intrepid to execute and deliver this
Agreement and to perform its obligations hereunder. Intrepid and its
Subsidiaries have obtained all Governmental Authorizations that are
necessary for the ownership or operation of the Intrepid Assets or the
conduct of the Intrepid Business as now conducted and which, if not
obtained and maintained, would, individually or in the aggregate, have
a material adverse effect on Intrepid. None of the Governmental
Authorizations listed in Section 6.6(a) of the Intrepid Disclosure
Schedule is subject to any restriction or condition that would limit
in any material respect the ownership or
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operations of the Intrepid Assets or the conduct of the Intrepid
Business as currently conducted, except for restrictions and
conditions generally applicable to Governmental Authorizations of such
type. The Governmental Authorizations listed in Section 6.6(a) of the
Intrepid Disclosure Schedule are valid and in good standing, are in
full force and effect and, to Intrepid's knowledge, are not impaired
in any material respect by any act or omission of Intrepid, its
Subsidiaries or any of their respective officers, directors, employees
or agents, and the ownership and operation of the Intrepid Assets and
the conduct of the Intrepid Business are in accordance in all material
respects with the Governmental Authorizations. All material reports,
forms and statements required to be filed by Intrepid and its
Subsidiaries with all Authorities and Self-Regulatory Organizations
with respect to the Intrepid Business have been filed and are true,
complete and accurate in all material respects. To Intrepid's
knowledge, no such Governmental Authorization currently held by
Intrepid or any of its Subsidiaries is the subject of any pending or,
to Intrepid's knowledge, threatened challenge or proceeding to revoke
or terminate any such Governmental Authorization that, individually or
in the aggregate, if revoked or terminated, would have a material
adverse effect on Intrepid. Intrepid has no reason to believe that any
such Governmental Authorization will not be renewed in the name of
Intrepid or its Subsidiaries, as the case may be, by the granting
Authority in the ordinary course.
(b) To Intrepid's knowledge, Intrepid and its
Subsidiaries are in compliance with all Applicable Laws, except where
such non-compliance, individually or in the aggregate, has not had and
is not reasonably likely to have a material adverse effect on
Intrepid. Except as set forth in Section 6.6(b) of the Intrepid
Disclosure Schedule or in the Intrepid SEC Reports, there are no Legal
Actions of any kind pending or, to the knowledge of Intrepid,
threatened, at law, in equity or before any Authority or
Self-Regulatory Organization against Intrepid or its Subsidiaries.
Such disclosed Legal Actions, if determined adversely to Intrepid or
its Subsidiaries, individually or in the aggregate, are not reasonably
likely to have a material adverse effect on Intrepid.
(c) Except as set forth in Section 6.6(c) of the
Intrepid Disclosure Schedule or in the Intrepid SEC Reports, to
Intrepid's knowledge, Intrepid and its Subsidiaries have not received
any notification or communication from any Authorities or
Self-Regulatory Organizations (i) asserting non-compliance with any of
the Laws that such Authorities or Self-Regulatory Organizations
enforce, (ii) threatening to revoke or condition the continuation of
any Private Authorization or Governmental Authorization (nor do any
grounds for any of the foregoing exist), (iii) requiring them (or any
of their respective directors or controlling Persons) to enter into a
cease and desist order, agreement, memorandum of understanding,
censure or disciplinary agreement (or requiring the board of directors
thereof to adopt any resolution or policy), or (iv) restricting or
disqualifying their respective activities (except for restrictions
generally imposed by disqualifying their respective activities) other
than for restrictions generally imposed by rule, regulation or
administrative policy on brokers or dealers generally.
(d) Other than periodic examinations by Self-Regulatory
Organizations in the ordinary course, Intrepid is not aware of any
pending or threatened investigation, review or disciplinary
proceedings by any Authorities or Self-Regulatory Organizations
against Intrepid or any Subsidiary of Intrepid or any of their
respective officers, directors or employees.
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(e) To Intrepid's knowledge, neither Intrepid, nor its
Subsidiaries, nor any of their respective employees is, and, to
Intrepid's knowledge, none of Intrepid's Affiliates or their
respective employees are, subject to a "statutory disqualification"
(as defined in Section 3(a)(39) of the Exchange Act) or subject to a
disqualification that would be a basis for censure, limitations on the
activities, functions or operations of, or suspension or revocation of
the registration of any broker-dealer Affiliate as a broker-dealer,
municipal securities dealer, government securities broker or
government securities dealer under Section 15, Section 15B or Section
15C of the Exchange Act, and, to Intrepid's knowledge, there is no
reasonable basis for, or proceeding or investigation, whether formal
or informal, or whether preliminary or otherwise, that is reasonably
likely to result in, any such censure, limitations, suspension or
revocation.
(f) Neither Intrepid nor any of its Subsidiaries is
required to be registered as an investment company, commodity trading
advisor, commodity pool operator, futures commission merchant,
introducing broker, insurance agent or transfer agent under any
federal, state, local or foreign Law. Neither Intrepid nor any its
Subsidiaries acts as the "sponsor" of a "broker-dealer trading
program", as such terms are defined in rule 17a-23 under the Exchange
Act.
(g) To Intrepid's knowledge, in the conduct of their
respective businesses, neither Intrepid nor any of its Subsidiaries
has (i) breached any applicable fiduciary duty under Part 4 of Title I
of ERISA which would subject it to liability under Sections 405 or 409
of ERISA or (ii) engaged in a "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975(c) of the Code which
would subject it to liability or Taxes under Sections 409 or 502(I) of
ERISA or Section 4975(a) of the Code.
(h) Neither Intrepid nor any of its Subsidiaries is
subject to any cease and desist, censure or other order issued by, or
a party to any written agreement, consent agreement, memorandum of
understanding or disciplinary agreement with, or a party to any
commitment letter or similar undertaking to, or subject to any order
or directive by, or a recipient of any supervisory letter from or
adopted any board resolutions at the request of any Authority or
Self-Regulatory Organization, or been advised by any Authority or
Self-Regulatory Organization that is considering issuing or requesting
any such agreement or other action, and Intrepid has no knowledge of
any pending or threatened regulatory investigation.
(i) To Intrepid's knowledge, except as set forth in
Section 6.6(i) of the Intrepid Disclosure Schedule or in the Intrepid
SEC Reports, Intrepid and its Subsidiaries have timely filed all
reports, registrations and statements, together with any amendments
required to be made with respect thereto, that were required to be
filed under any applicable law, regulation or rule, with (A) all
applicable Authorities and (B) any Self-Regulatory Organization
(collectively, the "Intrepid Reports"). To Intrepid's knowledge, as of
their respective dates, the Intrepid Reports complied with the
applicable statutes, rules, regulations and orders enforced or
promulgated by the regulatory authority with which they were filed.
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6.7 INTANGIBLE ASSETS. Except as set forth in Section 6.7 of the
Intrepid Disclosure Schedule or in the Intrepid SEC Reports, to Intrepid's
knowledge, no Intangible Assets (except Governmental Authorizations, Private
Authorizations and the Intangible Assets so set forth) are required for the
ownership or operation of the Intrepid Assets or the conduct of the Intrepid
Business as currently owned, operated and conducted, except for such exceptions
to the foregoing as, individually or in the aggregate, have not had and will
not have any material adverse effect on Intrepid. Intrepid and its Subsidiaries
do not, to Intrepid's knowledge, wrongfully infringe upon or unlawfully use any
Intangible Assets owned or claimed by another, and, to Intrepid's knowledge,
Intrepid and its Subsidiaries have not received any notice of any claim or
infringement relating to any such Intangible Asset, except for such exceptions
to the foregoing which, individually or in the aggregate, have not had and are
not reasonably likely to have any material adverse effect on Intrepid.
6.8 RELATED TRANSACTIONS. Neither Intrepid nor any Subsidiary of
Intrepid is a party or subject to any Contractual Obligation relating to the
ownership or operation of the Intrepid Assets or the conduct of the Intrepid
Business between Intrepid or any of its Subsidiaries and any of their
respective officers, directors, shareholders, employees or, to Intrepid's
knowledge, any Affiliate of any thereof, including any Contractual Obligation
providing for the furnishing of services to or by, providing for rental of
property, real, personal or mixed, to or from, or providing for the lending or
borrowing of money to or from or otherwise requiring payments to or from, any
such Person, other than (a) Employment Arrangements of Intrepid listed or
described in Section 6.8 of the Intrepid Disclosure Schedule, (b) Contractual
Obligations between Intrepid or any of its Subsidiaries and any of their
respective directors, shareholders, officers, employees or Affiliates of
Intrepid or any of the foregoing, which will be terminated, at no cost or
expense to Intrepid or its Subsidiaries, prior to the date hereof, or (c) as
otherwise specifically set forth in Section 6.8 of the Intrepid Disclosure
Schedule or in the Intrepid SEC Reports.
6.9 INSURANCE. Intrepid and its Subsidiaries maintain, with
respect to the Intrepid Assets and the Intrepid Business, policies of fire and
extended coverage and casualty, liability and other forms of insurance in such
amounts and against such risks and losses as are set forth in Section 6.9 of
the Intrepid Disclosure Schedule.
6.10 TAX MATTERS. Intrepid and each of its Subsidiaries have in
accordance with all Applicable Laws filed all Tax Returns which are required to
be filed, and have paid, or made adequate provision for the payment of, all
Taxes which have or may become due and payable pursuant to said Tax Returns and
all other governmental charges and assessments received to date and which are
now due and payable other than those Taxes being contested in good faith for
which adequate provision has been made on the most recent balance sheet forming
a part of the Intrepid Financial Statements. The Tax Returns of Intrepid and
its Subsidiaries have been prepared in all material respects in accordance with
all Applicable Laws. All Taxes which Intrepid and its Subsidiaries are required
by law to withhold and collect have been duly withheld and collected, and have
been paid over, in a timely manner, to the proper Authorities to the extent due
and payable. Neither Intrepid nor any of its Subsidiaries has executed any
waiver to
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extend, or otherwise taken or failed to take any action that would have the
effect of extending, the applicable statute of limitations in respect of any
Tax liabilities of Intrepid or its Subsidiaries for the fiscal years prior to
and including the most recent fiscal year. Adequate provision has been made on
the most recent balance sheet forming a part of the Intrepid Financial
Statements for all Taxes accrued through the date of such balance sheet of any
kind, including interest and penalties in respect thereof, whether disputed or
not, and whether past, current or deferred, accrued or unaccrued, fixed,
contingent, absolute or otherwise, and there are, to Intrepid's knowledge, no
past transactions or matters which are reasonably likely to result in
additional Taxes of a material nature to Intrepid for which an adequate reserve
has not been provided on such balance sheet. Niether Intrepid nor any of its
Subsidiaries is a "consenting corporation" within the meaning of Section 341(f)
of the Code. Intrepid and its Subsidiaries have at all times been taxable as
Subchapter C corporations under the Code, and have never been members of any
consolidated group for Tax purposes, except as otherwise set forth in Section
6.10 of the Intrepid Disclosure Schedule or in the Intrepid SEC Reports.
Neither Intrepid nor any of its Subsidiaries is a party to any tax sharing
agreement or arrangement.
6.11 EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. Except as
described in Section 6.11 of the Intrepid Disclosure Schedule or in the
Intrepid SEC Reports:
(a) Intrepid (which for purposes of this Section shall
include any ERISA Affiliate) has never contributed or sponsored, and
has not at any time since its organization made any contribution to or
sponsored, any Plan or Benefit Arrangement which is subject to ERISA.
(b) Intrepid is not and never has been a party to any
Multiemployer Plan or made contributions to any such Plan.
(c) Intrepid does not maintain any Plan that provides
benefits described in Section 3(1) of ERISA, except as the provisions
of COBRA may apply, to any former employees or retirees of Intrepid.
(d) The execution, delivery and performance by each
Intrepid Shareholder of this Agreement and the Collateral Documents
executed or required to be executed pursuant hereto and thereto will
not involve any prohibited transaction within the meaning of ERISA or
Section 4975 of the Code.
6.12 SOLVENCY. As of the execution and delivery of this Agreement,
Intrepid and each of its Subsidiaries (other than Subsidiaries which are
inactive and have only intercompany liabilities) are, and immediately prior to
and immediately after giving effect to the consummation of the Share Purchase
will be, Solvent.
6.13 MATERIAL AND ADVERSE RESTRICTIONS. Neither Intrepid nor any
Subsidiary of Intrepid is a party to or subject to, nor is any of the Intrepid
Assets subject to, any Applicable Law or Governmental Authorization (other than
Applicable Laws or Governmental Authorizations which affect similarly situated
businesses in Intrepid's industry generally), Contractual Obligation,
Employment Arrangement, Lease, Material Agreement, Private Authorization or any
other obligation or restriction of any kind or character, which now has or,
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as far as Intrepid can now reasonably foresee, individually or in the
aggregate, is reasonably likely to have, any material adverse effect on
Intrepid, except as set forth in Section 6.13 of the Intrepid Disclosure
Schedule or in the Intrepid SEC Reports. Except as set forth in Section 6.13 of
the Intrepid Disclosure Schedule or in the Intrepid SEC Reports, neither
Intrepid nor any of its Subsidiaries is subject to regulation under the
Investment Advisers Act of 1940, as amended, or the Investment Company Act of
1940, as amended. Intrepid, each of its Subsidiaries and each of their
respective employees which are or who are required to be registered as a
broker/dealer, an investment adviser, a registered representative, an insurance
agent or a sales Person (or in a similar capacity) with any Authority or any
Self-Regulatory Organization, are duly registered as such. All federal, state
and foreign registration requirements have been complied with in all material
respects and such registrations as currently filed, and all periodic reports
required to be filed with respect thereto, are accurate and complete in all
material respects.
6.14 BROKER OR FINDER. No Person assisted in or brought about the
negotiation of this Agreement or the Share Purchase in the capacity of broker,
agent or finder or in any similar capacity on behalf of Intrepid.
6.15 ENVIRONMENTAL MATTERS. Except as set forth in Section 6.15 of
the Intrepid Disclosure Schedule or in the Intrepid SEC Reports and except for
such non-compliance, failures and liabilities which have not had and are not
reasonably likely to have a material adverse effect on Intrepid, to Intrepid's
knowledge:
(a) Intrepid and each of its Subsidiaries (i) have
complied with the Environmental, Health and Safety Laws in all
material respects, and no action, suit, proceeding, hearing,
investigation, charge, complaint, claim, demand or notice has been
filed or commenced against any of them alleging any such failure to
comply, (ii) have obtained and has at all times been and is in
substantial compliance with all of the terms and conditions of all
Governmental Authorizations and training which are required under any
of the Environmental, Health and Safety Laws, and (iii) have complied
in all material respects with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations,
schedules and timetables which are contained in the Environmental,
Health and Safety Laws; and
(b) Intrepid and each of its Subsidiaries have no
material liability, and Intrepid and each of its Subsidiaries and
their respective predecessors have not handled or disposed of any
substance, arranged for the disposal of any substance, exposed any
employee or other individual to any substance or condition, or owned
or operated any property or facility in any manner that could give
rise to any material liability, for contamination or damage to any
site, location or body of water (surface or subsurface), for any
illness of or personal injury to any employee or other individual, or
for any reason under any Environmental, Health and Safety Law.
6.16 YEAR 2000 COMPLIANCE. To Intrepid's knowledge (without
inquiry or independent investigation), the software and hardware operated by
Intrepid are capable of providing uninterrupted millennium functionality to
record, store, process and present calendar dates falling on or after January
1, 2000 and date-dependent data in substantially the same
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manner and with the same functionality as such software records, stores,
processes and presents such calendar dates and date-dependent data as of the
date hereof.
ARTICLE 7.
COVENANTS
7.1 ACCESS TO INFORMATION.
(a) The Xxxxx Shareholders shall afford, and shall cause
Xxxxx to afford, to Intrepid and, on a need to know basis, its
accountants, counsel, financial advisors and other representatives
(the "Intrepid Representatives") full access during normal business
hours throughout the period prior to the Closing Date to all of
Xxxxx'x properties, books, contracts, commitments and records
(including its tax returns) and, during such period, shall furnish
promptly to Intrepid or the Intrepid Representatives (i) a copy of
each report, schedule, memorandum, letter, agreement or other document
that may have a material adverse effect on Xxxxx; and (ii) such other
information concerning the Xxxxx Business and the Xxxxx Assets as
Intrepid shall reasonably request; provided, however, that no
investigation pursuant to this Section 7.1 shall
amend or modify any representations or warranties made herein or the
conditions to the obligations of the respective parties to consummate
the Transactions.
(b) Intrepid shall, and shall use its best efforts to
cause the Intrepid Representatives to, hold in strict confidence, and
not disclose to any Person without the prior written consent of the
other party hereto, or use in any manner except in connection with the
Transactions, all information obtained from Xxxxx and the Xxxxx
Shareholders in connection with the Transactions (collectively,
"Confidential Information"), except that such Confidential Information
may be disclosed (i) where necessary to any Authorities or
Self-Regulatory Organizations; (ii) if required by court order or
decree; (iii) if it is ascertainable or obtained from public or
published information; (iv) if it is or becomes known to the public
other than through disclosure by Intrepid or the Intrepid
Representatives; (vi) if Intrepid can demonstrate it was in its
possession prior to disclosure thereof in connection with this
Agreement; (vii) if Intrepid can demonstrate it was independently
developed by it; or (viii) if Intrepid is advised in writing by
counsel that it is legally required to make such disclosure. If such
information is to be disclosed pursuant to (i) or (ii) hereinabove,
Intrepid shall (x) give as much notice to the Xxxxx Shareholders as is
practicable prior to making such disclosure, (y) cooperate with the
Xxxxx Shareholders to obtain an appropriate protective order or other
reliable assurance to prevent or limit the disclosure of the
information and (z) disclose only that portion of the information as
is necessary to comply with Applicable Law.
7.2 CONDUCT OF THE BUSINESS PRIOR TO THE CLOSING. During the
period from the date of this Agreement to the Closing Date, except as otherwise
contemplated by this Agreement or consented to or approved by Intrepid in
writing, the Xxxxx Shareholders shall cause Xxxxx (i) to conduct the Xxxxx
Business in the usual, regular and ordinary course consistent with past practice
and prudent business principles and (ii) to use its reasonable best efforts to
maintain and preserve intact its business organization, employees, goodwill with
customers and advantageous
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business relationships and to retain the services of its officers and key
employees. The Xxxxx Shareholders further agree that on and or after the date
hereof and prior to the Closing Date, without the written consent of Intrepid,
the Xxxxx Shareholders shall not cause or otherwise suffer or permit Xxxxx or
any of its Subsidiaries to:
(a) alter, amend or modify any provision of its Articles
of Incorporation and Bylaws;
(b) incur or become subject to, or agree to incur or
become subject to, any obligation or liability (absolute or
contingent) except current liabilities incurred, and obligations under
contracts entered into, in the ordinary course of the Xxxxx Business;
(c) discharge or satisfy any Lien or pay any obligation
or liability (absolute or contingent) other than liabilities payable
in the ordinary course of the Xxxxx Business;
(d) mortgage, pledge or subject to any Lien any of
Xxxxx'x properties, or agree so to do;
(e) sell or transfer or agree to sell or transfer any of
the Xxxxx Assets or cancel or agree to cancel any debt or claim,
except in each case in the ordinary course of the Xxxxx Business;
(f) consent or agree to a waiver of any right of
substantial value;
(g) enter into any transaction other than in the
ordinary course of the Xxxxx Business;
(h) except as provided in Section 7.2(h) of the Xxxxx
Disclosure Schedule, increase the rate of compensation payable or to
become payable by it to any Xxxxx Employees or any agents of Xxxxx by
more than 5% of the rate being paid to them at the date hereof;
(i) terminate any Material Agreement of Xxxxx;
(j) through negotiation or otherwise, make any
commitment or incur any liability or obligation to any labor
organization except in the ordinary course of the Xxxxx Business
consistent with past practice;
(k) except as provided in Section 7.2(k) of the Xxxxx
Disclosure Schedule, make or agree to make any accrual or arrangement
for or payment of bonuses or special compensation of any kind to any
Xxxxx Employee;
(l) except for the termination of Ms. Xxxxxx Xxxxx, the
details of which have been previously provided by Xxxxx to Intrepid,
terminate any Xxxxx Employee earning in excess of $25,000 per annum or
directly or indirectly pay or make a commitment to pay any severance
or termination pay to any Xxxxx Employee or agent of Xxxxx except in
the ordinary course of the Xxxxx Business consistent with past
practice;
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(m) introduce any new method of management, operation or
accounting with respect to the Xxxxx Business or any of the Xxxxx
Assets or any rights applicable thereto;
(n) offer or extend more favorable prices, discounts or
allowances than were offered or extended regularly on and prior to the
date hereof;
(o) make capital expenditures or commitments therefor in
excess of $10,000 except for repairs and maintenance in the ordinary
course of the Xxxxx Business consistent with past practice; or
(p) authorize or enter into any agreement to do any of
the foregoing.
7.3 AGREEMENT TO COOPERATE. Subject to the terms and conditions
herein provided, each of the parties hereto shall use all reasonable efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under Applicable Law to consummate and
make effective the Transactions, including using its reasonable efforts to
obtain all Private Authorizations and Governmental Authorizations and to effect
all necessary filings and submissions with all Authorities and Self-Regulatory
Organizations.
7.4 SATISFACTION OF CONDITIONS. Each of the parties hereto shall
use its best efforts to fulfill or obtain the fulfillment of all of the
conditions to Closing set forth herein.
7.5 NOTICE OF DEVELOPMENTS. Intrepid and the Xxxxx Shareholders
agree to give each other prompt written notice in the event that any of the
representations and warranties made by Intrepid or any of the Xxxxx
Shareholders are discovered to be untrue as of the time made or in the event
any party hereto determines that his or its own representations and warranties
shall be untrue as if made at and as of the Closing Date.
7.6 EMPLOYEE BENEFITS. Following the Closing Date, Intrepid shall
provide generally to the officers and employees of Xxxxx and its Subsidiaries
employee benefits under employee benefit plans on terms and conditions which,
when taken as a whole, are substantially similar to those currently provided by
Xxxxx and its Subsidiaries to their similarly situated officers and employees
and set forth in Section 7.6 of the Xxxxx Disclosure Schedule. For purposes of
participation and vesting under such employee benefit plans, the service of the
employees of Xxxxx and its Subsidiaries prior to the Closing Date shall be
treated as service with Intrepid.
7.7 ELECTIONS TO THE BOARD OF DIRECTORS. Immediately following
the Closing, Intrepid shall use its best efforts to cause Messrs. Xxxxxxxx X.
Xxxxxx, Xx. and Xxxxxx X. Xxxxxxxxx to be elected to the Board of Directors of
Intrepid.
7.8 ADVANCE TO EMPLOYEE. If, following the Closing Date, Xxxxx
shall receive reimbursement of the advance made by Xxxxx to Xxx Xxxxx in the
amount of $31,136.14 or any portion thereof, such amount shall be paid in cash
in immediately available funds to each of the Xxxxx Shareholders in proportion
to their Pro Rata Amount without adjustment by Intrepid.
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7.9 KEY MAN INSURANCE. After the Closing, Intrepid or Xxxxx may,
in its discretion and at its sole cost and expense, purchase and maintain one
or more policies of key man insurance on Xxxxxx, which policies of insurance
shall designate Intrepid or Xxxxx, as the case may be, as the beneficiary
thereunder. Xxxxxx covenants and agrees to cooperate fully with Intrepid and
Xxxxx after the date hereof in obtaining such policies of insurance and to make
available all records and information that are required to obtain such policies
of insurance in a prompt and timely manner.
7.10 RULE 144. From the Closing Date until December 31, 2004,
Intrepid shall (i) make available adequate current public information and (ii)
file with the SEC in a timely manner all reports and other documents required
of Intrepid under the Exchange Act so as to facilitate the disposition by the
Xxxxx Shareholders of the shares of common stock of Intrepid, if any, issued to
the Xxxxx Shareholders upon conversion of the Synagen Promissory Note, the
Xxxxxx Promissory Note or the Xxxxxxxxx Promissory Note, as the case may be, in
accordance with the terms of Rule 144 under the Securities Act as in effect on
the date hereof. In connection with any sale, transfer or other disposition by
any Xxxxx Shareholder or its assigns of shares of the capital stock of Intrepid
pursuant to Rule 144 under the Securities Act, Intrepid shall reasonably
cooperate with such Xxxxx Shareholder or its assigns to facilitate the timely
preparation and delivery of certificates representing such shares to be sold
and not bearing any Securities Act legend other than as may be required by
Applicable Law.
ARTICLE 8.
CLOSING; CLOSING DATE; DELIVERIES
8.1 CLOSING; CLOSING DATE. The Transactions shall close and all
deliveries to be made at the time of closing of the Transactions (the
"Closing") shall take place at 10:00 a.m., local time, on August 4, 1999, or on
such other date as may be agreed upon from time to time in writing by the Xxxxx
Shareholders and Intrepid (the "Closing Date"). The Closing shall take place at
the offices of Xxxxx & Xxxxxxx, Jacksonville, Florida, or such other place as
the parties hereto shall agree.
8.2 DELIVERIES BY THE XXXXX SHAREHOLDERS. On or prior to the
Closing Date, the Xxxxx Shareholders shall deliver or cause to be delivered to
Intrepid each of the following:
(a) Certificates representing the Shares in accordance
with the terms of Section 2.2 hereof.
(b) An Employment Agreement substantially in the form of
Exhibit D attached hereto and incorporated herein by this reference
(the "Xxxxxx Employment Agreement"), duly executed by Xxxxxx;
(c) An Employment Agreement substantially in the form of
Exhibit E attached hereto and incorporated herein by this reference
(the "Beach Employment Agreement"), duly executed by Beach;
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(d) An opinion of Xxxxx & Lardner, counsel to Xxxxx,
dated as of the Closing Date, substantially in the form of Exhibit F
hereto;
(e) Written resignations of all of the directors and
officers of Xxxxx, except for such directors and officers as Intrepid
shall designate in writing; and
(f) Such other separate instruments or documents as
Intrepid may reasonably deem necessary or appropriate in order to
consummate the Transactions.
8.3 DELIVERIES BY INTREPID. On or prior to the Closing Date,
Intrepid shall deliver or cause to be delivered to the Xxxxx Shareholders each
of the following:
(a) The cash portion of the Purchase Price in accordance
with the terms of Section 2.1 hereof;
(b) The Synagen Promissory Note, duly executed by
Intrepid;
(c) The Xxxxxx Promissory Note, duly executed by
Intrepid;
(d) The Xxxxxxxxx Promissory Note, duly executed by
Intrepid;
(e) The Xxxxxx Employment Agreement, duly executed by
Intrepid;
(f) The Beach Employment Agreement, duly executed by
Intrepid;
(g) An opinion of Xxxxxx & Xxxxxx LLP, counsel to
Intrepid, dated as of the Closing Date, substantially in the form of
Exhibit G hereto; and
(h) Such other separate instruments or documents as the
Xxxxx Shareholders may reasonably deem necessary or appropriate in
order to consummate the Transactions.
ARTICLE 9.
CONDITIONS PRECEDENT TO OBLIGATIONS
9.1 CONDITIONS TO OBLIGATIONS OF INTREPID. Each and every
obligation of Intrepid to be performed on the Closing Date shall be subject to
the satisfaction on or prior to the Closing Date of the following conditions
(unless waived in writing by Intrepid):
(a) The representations and warranties set forth in
Articles 3, 4 and 5 hereof shall have been true and correct in all
material respects when made and shall be true and correct in all
material respects at and as of the Closing Date as if such
representations and warranties were made as of the Closing Date,
except for changes permitted or contemplated by this Agreement and
except to the extent that any representation or a warranty is made as
of a specified date, in which case such representation or warranty
shall be true and correct as of such date;
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(b) All covenants, conditions and other obligations
under this Agreement which are to be performed or complied with by the
Xxxxx Shareholders shall have been fully performed and complied with
on or prior to the Closing Date, including the delivery of fully
executed instruments and documents in accordance with Section 8.2
hereof;
(c) There shall be no pending or threatened Claims,
Legal Actions or investigations by any Authorities against Intrepid,
the Xxxxx Shareholders or Xxxxx, for the purpose of enjoining or
preventing the consummation of this Agreement or the Transactions, or
otherwise claiming that this Agreement or the consummation of the
Transactions is illegal;
(d) All Private Authorizations, Governmental
Authorizations and filings or registrations with any Authority or
Self-Regulatory Organization required in connection with the
execution, delivery and performance of this Agreement (including all
consents, approvals, authorizations, certificates, licenses and
permits of the NASD) shall have been obtained or made, except where
the failure to have obtained or made any such consent, authorization,
order, approval, filing or registration would not have a material
adverse effect on Xxxxx; and
(e) There shall not have occurred any event or
circumstance resulting or reasonably likely to have a material adverse
effect on Xxxxx.
9.2 CONDITIONS TO OBLIGATIONS OF THE XXXXX SHAREHOLDERS. Each and
every obligation of the Xxxxx Shareholders to be performed on the Closing Date
shall be subject to the satisfaction on or prior to the Closing Date of the
following conditions (unless waived in writing by the Xxxxx Shareholders):
(a) The representations and warranties set forth in
Article 6 hereof shall have been true and correct in all material
respects when made and shall be true and correct in all material
respects at and as of the Closing Date as if such representations and
warranties were made as of the Closing Date, except for changes
permitted or contemplated by this Agreement and except to the extent
that any representation or a warranty is made as of a specified date,
in which case such representation or warranty shall be true and
correct as of such date;
(b) All covenants, conditions and other obligations
under this Agreement which are to be performed or complied with by
Intrepid shall have been fully performed and complied with on or prior
to the Closing Date, including the delivery of fully executed
instruments and documents in accordance with Section 8.3 hereof;
(c) There shall be no pending or threatened Claims,
Legal Actions or investigations by any Authorities against Intrepid,
the Xxxxx Shareholders or Xxxxx, for the purpose of enjoining or
preventing the consummation of this Agreement or the Transactions, or
otherwise claiming that this Agreement or the consummation of the
Transactions is illegal;
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(d) All Private Authorizations, Governmental
Authorizations and filings or registrations with any Authority or
Self-Regulatory Organization required in connection with the
execution, delivery and performance of this Agreement (including all
consents, approvals, authorizations, certificates, licenses and
permits of the NASD shall have been obtained or made, except where the
failure to have obtained or made any such consent, authorization,
order, approval, filing or registration would not have a material
adverse effect on Intrepid; and
(e) There shall not have occurred any event or
circumstance resulting or reasonably likely to have a material adverse
effect on Intrepid.
ARTICLE 10.
INDEMNIFICATION
10.1 SURVIVAL. Regardless of any investigation or statement as to
the results thereof made by or on behalf of any party hereto, the
representations and warranties of the parties contained in or made pursuant to
this Agreement or any Collateral Document shall survive the Closing Date and
shall remain operative and in full force and effect for a period of twelve (12)
months after the Closing Date, except for representations and warranties
contained in Sections 3.1, 3.2, 3.5, 3.8, 3.14, 4.2, 4.3, 4.4, 4.7, 5.2, 5.3,
5.4, 5.7, 6.1, 6.4, 6.6, 6.7, 6.10, 6.11 and 6.16 hereof, all of which shall
survive and remain operative and in full force and effect for the applicable
statute of limitations. The covenants and agreements of the parties contained
in or made pursuant to this Agreement or any Collateral Document shall survive
the Closing Date (unless any such covenant or agreement by its express terms in
this Agreement does not so survive) and shall remain operative and in full
force and effect for the statute of limitations applicable to contractual
obligations. The term "Indemnity Period" shall mean the applicable period with
respect to which a representation, warranty, covenant or agreement survives the
Closing Date as provided in this Section 10.1. No claim for indemnification,
other than with respect to fraud or intentional and willful breach or
misrepresentation, may be asserted after the expiration of the Indemnity
Period. Notwithstanding anything herein to the contrary, any representation,
warranty, covenant and agreement which arises and is the subject of a Claim
which is asserted in writing prior to the expiration of the applicable
Indemnity Period shall survive with respect to such Claim or any dispute with
respect thereto until the final resolution thereof.
10.2 INDEMNIFICATION.
(a) Each Xxxxx Shareholder agrees, severally and not
jointly, that on and after the Closing Date, such Xxxxx Shareholder
shall indemnify and hold harmless Intrepid and its stockholders,
directors, officers, employees and representatives (collectively, the
"Intrepid Indemnified Parties") from and against such Xxxxx
Shareholder's Pro Rata Amount of any and all damages, claims, losses,
expenses, costs, obligations, and liabilities, including liabilities
for all reasonable attorneys', accountants' and experts' fees and
expenses incurred, including those incurred to enforce the terms of
this Agreement or any Collateral Document (collectively, "Loss and
Expense"), suffered by the Intrepid Indemnified Parties by reason of
or arising out of (i) any breach of representation or warranty made by
such Xxxxx Shareholder pursuant to this Agreement or any Collateral
Document, or (ii) any failure by such Xxxxx Shareholder to perform or
fulfill any of its covenants or agreements set forth in this Agreement
or any Collateral Document.
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(b) Intrepid agrees that on and after the Closing Date
it shall indemnify each Xxxxx Shareholder and hold such Xxxxx
Shareholder harmless from and against all Loss and Expense suffered by
such Xxxxx Shareholder by reason of or arising out of (i) any breach
of representation or warranty made by Intrepid pursuant to this
Agreement or any Collateral Document, or (ii) any failure by Intrepid
to perform or fulfill any of its covenants or agreements set forth in
this Agreement or any Collateral Document.
10.3 LIMITATION OF LIABILITY. Notwithstanding the provisions of
Section 10.2 hereof, after the Closing Date, except as otherwise provided in
Section 10.6 hereof, the Intrepid Indemnified Parties, on the one hand, and the
Xxxxx Shareholders, on the other hand, shall be entitled to recover their Loss
and Expense in respect of any Claim only (i) in the event that the aggregate
Loss and Expense for all Claims exceeds, in the aggregate, Twenty-Five Thousand
Dollars ($25,000), in which event the indemnified party shall be entitled to
recover all such Loss and Expense; and (ii) to the extent that the aggregate
Loss and Expense for all Claims does not exceed Five Hundred Thousand Dollars
($500,000). In no event shall (i) the liability of any Xxxxx Shareholder exceed
his or its Pro Rata Amount of the aggregate Loss and Expense which may be
recovered hereunder, or (ii) any Xxxxx Shareholder be entitled to recover more
than his or its Pro Rata Amount of the aggregate Loss and Expense which may be
recovered hereunder.
10.4 NOTICE OF CLAIMS. If an indemnified party believes that it
has suffered or incurred any Loss and Expense, it shall notify the indemnifying
party promptly in writing, and in any event within the applicable Indemnity
Period specified in Section 10.1 hereof, describing such Loss and Expense, all
with reasonable particularity and containing a reference to the provisions of
this Agreement in respect of which such Loss and Expense shall have occurred.
If any Legal Action is instituted by a third party with respect to which an
indemnified party intends to claim any liability or expense as Loss and Expense
under this Article, such indemnified party shall promptly notify the
indemnifying party of such Legal Action, but the failure to so notify the
indemnifying party shall not relieve such indemnifying party of its obligations
under this Article, except to the extent such failure to notify prejudices such
indemnifying party's ability to defend against such Claim.
10.5 DEFENSE OF THIRD PARTY CLAIMS. The indemnifying party shall
have the right to conduct and control, through legal counsel of its own
choosing, reasonably acceptable to the indemnified party, any third party Legal
Action or other Claim, but the indemnified party may, at its election,
participate in the defense thereof at its sole cost and expense; provided,
however, that if the indemnifying party shall fail to defend any such Legal
Action or other Claim, then the indemnified party may defend, through legal
counsel of its own choosing, such Legal Action or other Claim, and (so long as
it gives the indemnifying party at least fifteen (15) days' notice of the terms
of the proposed settlement thereof and permits the indemnifying party to then
undertake the defense thereof) settle such Legal Action or other Claim and to
recover the amount of such settlement or of any judgment and the reasonable
costs and expenses of such defense. The indemnifying party shall not compromise
or settle any such Legal Action or other Claim without the prior written
consent of the indemnified party, which consent shall not unreasonably
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be withheld, delayed or conditioned if the terms and conditions of such
compromise or settlement proposed by the indemnifying party and agreed to in
writing by the claimant in such Legal Action or other Claim (a) include a full
release of the indemnified party from the Legal Action or other Claim which is
the subject of the Settlement Proposal, and (b) if the indemnified party is an
Intrepid Indemnified Party, and such compromise or settlement does not include
any term or condition which would restrict in any material manner the continued
ownership or operations of the Xxxxx Assets or the conduct of the Xxxxx
Business in substantially the manner then being owned, operated and conducted.
No matter whether an indemnifying party defends or prosecutes any third party
Legal Action or Claim, the indemnified and indemnifying parties shall cooperate
in the defense or prosecution thereof. Such cooperation shall include access
during normal business hours afforded to the indemnifying party to, and
reasonable retention by the indemnified party of, records and information which
are reasonably relevant to such third party Legal Action or Claim, and making
employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder, and the
indemnifying party shall reimburse the indemnified party for all its reasonable
out-of-pocket expenses in connection therewith.
10.6 RIGHT OF SET-OFF. If from time to time and at any time after
the Closing Date Intrepid or Xxxxx shall have been finally determined to be
entitled to be paid any amount by the Xxxxx Shareholders based upon a final and
binding arbitration or the final judgment of a court of competent jurisdiction
under the provisions of this Article 10 or any other provision of this
Agreement or pursuant to any Exhibit hereto or any other agreement executed and
delivered in connection herewith, Intrepid and Xxxxx shall be entitled, if they
so elect, to set-off such amount against, or to deduct such amount from, any
payments to be made by Intrepid or Xxxxx to the Xxxxx Shareholders pursuant to
this Agreement, the Synagen Promissory Note, the Xxxxxx Promissory Note or the
Xxxxxxxxx Promissory Note. The right of set-off described in this Section 10.6
shall be in addition to, and not in substitution of, any other rights Intrepid
and Xxxxx shall be entitled to under the provisions of this Article 10 or
otherwise.
10.7 EXCLUSIVE REMEDY. Except for fraud, purposeful or intentional
misrepresentation or willful or intentional breach of any warranty, covenant or
agreement or as otherwise provided in Section 12.4 hereof, the indemnification
(and any available right of offset) provided in this Article 10 shall be the
sole and exclusive remedy after the Closing Date available to any party against
any other party for any Claim under this Agreement.
ARTICLE 11.
TERMINATION
11.1 TERMINATION BY INTREPID. This Agreement may be terminated and
cancelled at any time prior to the Closing Date by Intrepid upon written notice
to the Xxxxx Shareholders if: (i) any of the representations or warranties of
the Xxxxx Shareholders contained herein shall prove to be inaccurate or untrue;
or (ii) any obligation, term or condition to be performed, kept or observed by
the Xxxxx Shareholders or Xxxxx hereunder has not been performed, kept or
observed in any material respect at or prior to the time specified in this
Agreement; provided, however, that the Xxxxx Shareholders shall have a 10-day
period in which to cure any defect described in clause (i) or (ii) of this
Section 11.1, and Intrepid may not terminate this Agreement if the Xxxxx
Shareholders cure such defect within such 10-day period.
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11.2 TERMINATION BY THE XXXXX SHAREHOLDERS. This Agreement may be
terminated and cancelled at any time prior to the Closing Date by the Xxxxx
Shareholders upon joint written notice to Intrepid if: (i) any of the
representations or warranties of Intrepid contained herein shall prove to be
inaccurate or untrue; or (ii) any obligation, term or condition to be
performed, kept or observed by Intrepid hereunder has not been performed, kept
or observed in any material respect at or prior to the time specified in this
Agreement; provided, however, that Intrepid shall have a 10-day period in which
to cure any defect described in clause (i) or (ii) of this Section 11.2, and
the Xxxxx Shareholders may not terminate this Agreement if Intrepid cures such
defect within such 10-day period.
11.3 TERMINATION BY ANY PARTY. Any party hereto shall have the
right to terminate and cancel this Agreement if (i) the Closing Date shall not
have occurred on or before September 1, 1999, provided that such failure of
occurrence shall not have resulted from the delay, default or breach of such
party; or (ii) a court of competent jurisdiction shall have issued an order,
decree or ruling permanently restraining, enjoining or otherwise prohibiting
the transactions contemplated by this Agreement, and such order, decree, ruling
or other action shall have become final and nonappealable.
11.4 TERMINATION BY MUTUAL CONSENT. This Agreement may be
terminated and cancelled at any time prior to the Closing Date by mutual
written consent of Intrepid and the Xxxxx Shareholders.
11.5 EFFECT OF TERMINATION. In the event of termination of this
Agreement by any party hereto as provided in this Article 11, this Agreement
shall forthwith become void and there shall be no further obligation on the
part of either party or their officers or directors (except as set forth in
this Section 11.5 and in Section 7.1(b), which shall survive such termination;
provided, however, that nothing in this Section 11.5 shall relieve any party
from liability for any breach or failure of observance of any provision of this
Agreement. ARTICLE 12. GENERAL PROVISIONS
12.1 WAIVERS; AMENDMENTS. Changes in or additions to this
Agreement may be made, or compliance with any term, covenant, agreement,
condition or provision set forth herein may be omitted or waived (either
generally or in a particular instance and either retroactively or
prospectively) with, but only with, the consent in writing of the parties
hereto. No delay on the part of either party at any time or times in the
exercise of any right or remedy shall operate as a waiver thereof. Any consent
may be given subject to satisfaction of conditions stated therein. The failure
to insist upon the strict provisions of any covenant, term, condition or other
provision of this Agreement or to exercise any right or remedy thereunder shall
not constitute a waiver of any such covenant, term, condition or other
provision thereof or default in connection therewith. The waiver of any
covenant, term, condition or other provision thereof or default thereunder
shall not affect or alter this Agreement in any other respect, and each and
every covenant, term,
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condition or other provision of this Agreement shall, in such event, continue
in full force and effect, except as so waived, and shall be operative with
respect to any other then existing or subsequent default in connection
therewith.
12.2 FEES, EXPENSES AND OTHER PAYMENTS. All costs and expenses
incurred in connection with any transfer taxes, sales taxes, recording or
documentary taxes, stamps or other charges levied by any Authority in
connection with this Agreement and the consummation of the Share Purchase shall
be paid by Intrepid. Except for the costs and expenses referred to in the first
sentence of this Section 12.2, (a) Intrepid shall pay its own fees, costs and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby, including the fees, costs and expenses of its financial
advisors, accountants and legal counsel, and (b) the Xxxxx Shareholders shall
pay all of the fees, costs and expenses incurred by them and by Xxxxx and its
Subsidiaries in connection with this Agreement and the transactions
contemplated hereby, including the fees, costs and expenses of their respective
financial advisors, accountants and legal counsel; provided, however, that all
fees, costs and expenses of Xxxxx and its Subsidiaries and the Xxxxx
Shareholders incurred in connection with this Agreement and the transactions
contemplated hereby shall be borne by Xxxxx and shall be accounted for as a
reduction in Actual Equity on the Closing Date Balance Sheet. Any of such fees,
costs and expenses not accounted for as a reduction in Actual Equity on the
Closing Date Balance Sheet shall be paid by the Xxxxx Shareholders and shall
not be paid by Xxxxx or its Subsidiaries or out of any of the Xxxxx Assets.
12.3 NOTICES. All notices and other communications which by any
provision of this Agreement are required or permitted to be given shall be
given in writing and shall be deemed to have been delivered (a) three (3)
business days after being mailed by first-class or express mail, postage
prepaid, (b) the next day when sent overnight by recognized courier service,
(c) upon confirmation when sent by telex, telegram, telecopy or other form of
rapid transmission, confirmed by mailing (by first class or express mail,
postage prepaid, or by recognized courier service) written confirmation at
substantially the same time as such rapid transmission, or (d) upon delivery
when personally delivered to the receiving party (which if other than an
individual shall be an officer or other responsible party of the receiving
party). All such notices and communications shall be mailed, sent or delivered
as follows:
(a) If to Intrepid:
Intrepid Capital Corporation
00 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxxx Xxxxxx
Telecopier No.: (000) 000-0000
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with a copy to (which shall not constitute notice to
Intrepid):
Xxxxxx & Xxxxxx LLP
0000 Xxxxxxxxxxxxx Xxxxx, Xxxxxxxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxx, Esq.
Telecopier No.: (000) 000-0000
(b) If to the Xxxxx Shareholders:
Xxxxxxx X. Xxxxxx and Synagen Capital Partners, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxx Xxxx, Xxxxxxx 00000
Telecopier No.: (000) 000-0000
with a copy to (which shall not constitute notice to any
Xxxxx Shareholder):
Xxxxx & Xxxxxxx
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
Telecopier No.: (000) 000-0000
or to such other person(s), telex or facsimile number(s) or address(es) as the
party to receive any such communication or notice may have designated by
written notice to the other party.
12.4 SPECIFIC PERFORMANCE; OTHER RIGHTS AND REMEDIES. Each party
recognizes and agrees that in the event the other party should refuse to
perform any of its obligations under this Agreement or any Collateral Document,
the remedy at law would be inadequate and further agrees that for breach of
such provisions, each party shall, in addition to the remedies set forth in
Article 10 hereof and such other remedies as may be available to it at law or
in equity, be entitled to injunctive relief and to enforce its rights by an
action for specific performance to the extent permitted by Applicable Law. Each
party hereby waives any requirement for security or the posting of any bond or
other surety in connection with any temporary or permanent award of injunctive,
mandatory or other equitable relief. Nothing herein contained shall be
construed as prohibiting any party from pursuing any other remedies available
to it pursuant to the provisions of this Agreement or Applicable Law for such
breach or threatened breach, including the recovery of damages.
12.5 SEVERABILITY. If any term or provision of this Agreement
shall be held to be, or shall in fact be, invalid, illegal or unenforceable,
the validity, legality or enforceability of the other provisions and terms
hereof, or the application of such term or provision to Persons or
circumstances other than those to which it is held invalid, illegal or
unenforceable, shall not be affected thereby, and there shall be deemed
substituted for the provision or term at issue a valid, legal and enforceable
provision as similar as possible to the provision or term at issue. If any term
or provision of this Agreement shall be held or deemed to be, or shall in fact
be, invalid, inoperative, illegal or unenforceable as applied to any particular
case in any jurisdiction or
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jurisdictions, or in all jurisdictions or in all cases, because of the
conflicting of any provision with any constitution or statute or rule of public
policy or for any other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid, inoperative, illegal
or unenforceable in any other jurisdiction or in any other case or circumstance
or of rendering any other provision or provisions herein contained invalid,
inoperative, illegal or unenforceable to the extent that such other provisions
are not themselves actually in conflict with such constitution, statute or rule
of public policy, but this Agreement shall be reformed and construed in any
such jurisdiction or case as if such invalid, inoperative, illegal or
unenforceable provision had never been contained herein and such provision
reformed so that it would be valid, operative and enforceable to the maximum
extent permitted in such jurisdiction or in such case. Notwithstanding the
foregoing, in the event of any such determination the effect of which is to
affect materially and adversely any party, the parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible to the fullest extent permitted by Applicable
Law in an acceptable manner to the end that the Transactions are fulfilled and
consummated to the maximum extent possible.
12.6 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument, binding upon all of the
parties. In pleading or proving any provision of this Agreement, it shall not
be necessary to produce more than one set of such counterparts.
12.7 SECTION HEADINGS. The headings contained in this Agreement
are for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
12.8 GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by, and construed in accordance
with the laws of the State of Florida, without giving effect to any choice or
conflict of laws provision or rule that would cause the application of domestic
substantive laws of any other jurisdiction.
12.9 FURTHER ACTS. Each party hereto agrees that at any time, and
from time to time, before and after the consummation of the transactions
contemplated by this Agreement, it will do all such things and execute and
deliver all such Collateral Documents and other assurances, as any other party
hereto or its legal counsel reasonably deems necessary or desirable in order to
carry out the terms and conditions of this Agreement and the transactions
contemplated hereby or to facilitate the enjoyment of any of the rights created
hereby or to be created hereunder.
12.10 ENTIRE AGREEMENT. This Agreement (together with the Xxxxx
Disclosure Schedule, the Exhibits and the other Collateral Documents delivered
or to be delivered in connection herewith) constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes all prior
agreements, arrangements, covenants, promises, conditions, undertakings,
inducements, representations, warranties and negotiations, expressed or
implied, oral or written, between the parties, with respect to the subject
matter hereof. Each of the parties hereto is a sophisticated Person that was
advised by experienced legal counsel and, to the extent it deemed necessary,
other advisors in connection with this Agreement. Each of the parties hereto
hereby acknowledges that (a) none of the parties hereto has relied or will rely
in respect of this Agreement or the transactions contemplated hereby upon any
document or written or oral information previously furnished to or discovered
by it or its representatives, other than
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this Agreement (or such of the foregoing as are delivered at the consummation
of the Share Purchase), (b) there are no covenants or agreements by or on
behalf of any party hereto or any of its respective Affiliates or
representatives other than those expressly set forth in this Agreement and the
Collateral Documents, and (c) the parties' respective rights and obligations
with respect to this Agreement and the events giving rise thereto will be
solely as set forth in this Agreement and the Collateral Documents.
12.11 EXHIBITS. The Xxxxx Disclosure Schedule and all Exhibits
hereto are hereby incorporated into this Agreement and made a part hereof as if
set out in full herein.
12.12 ASSIGNMENT. This Agreement shall not be assignable by any
party hereto and any such assignment shall be null and void, except that it
shall inure to the benefit of and be binding upon any successor to any party
hereto by operation of law, including by way of merger, consolidation or sale
of all or substantially all of its assets.
12.13 PARTIES IN INTEREST. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any Person
any right, benefit or remedy of any nature whatsoever under or by reason of
this Agreement, except as otherwise provided in Section 12.12 hereof. There are
no third party beneficiaries of this Agreement.
12.14 MUTUAL DRAFTING. This Agreement is the result of the joint
efforts of the Xxxxx Shareholders and Intrepid, and each provision hereof has
been subject to the mutual consultation, negotiation and agreement of the
parties hereto and there shall be no construction against any party hereto
based on any presumption of that party's involvement in the drafting thereof.
[SIGNATURES NEXT PAGE]
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement or caused this Agreement to be executed and delivered by their
respective officers thereunto duly authorized, all as of the date first written
above.
INTREPID CAPITAL CORPORATION
By /s/ Xxxxxxx Xxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxx
------------------------------------
Title: President
-----------------------------------
XXXXX SHAREHOLDERS:
/s/ Xxxxxxx X. Xxxxxx
----------------------------------------------
XXXXXXX X. XXXXXX, AS TRUSTEE OF THE
XXXXXXX X. XXXXXX REVOCABLE TRUST DATED
SEPTEMBER 10, 1997
SYNAGEN CAPITAL PARTNERS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------------------
Title: President
-----------------------------------
/s/ Xxxxxxxx X. Xxxxxx, Xx.
----------------------------------------------
XXXXXXXX X. XXXXXX, XX.
/s/ Xxxxxx X. Xxxxxxxxx
----------------------------------------------
XXXXXX X. XXXXXXXXX
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APPENDIX I
DEFINITIONS
ACTUAL EQUITY shall have the meaning given to it in Section 2.3.
ADVERSE, ADVERSELY, when used alone or in conjunction with other terms
(including "affect," "change" and "effect") shall mean any Event which is
reasonably likely, in the reasonable business judgment of the relevant party,
to be expected to (a) adversely affect the validity or enforceability of this
Agreement or the likelihood of consummation of the Share Purchase, or (b)
adversely affect the business, operations, management, properties or prospects,
or the condition, financial or other, or results of operation of the Xxxxx
Business or the business of Intrepid, as applicable, or (c) impair such party's
ability to fulfill its obligations under the terms of this Agreement, or (d)
adversely affect the aggregate rights and remedies of such party under this
Agreement.
AFFILIATE, AFFILIATED shall mean, with respect to any Person, (a) any
other Person at the time directly or indirectly controlling, controlled by or
under direct or indirect common control with such Person, (b) any other Person
of which such Person at the time owns, or has the right to acquire, directly or
indirectly, five percent (5%) or more of any class of the capital stock or
beneficial interest, (c) any other Person which at the time owns, or has the
right to acquire, directly or indirectly, five percent (5%) or more of any
class of the capital stock or beneficial interest of such Person, (d) any
executive officer or director of such Person, (e) with respect to any
partnership, joint venture or similar Entity, any general partner thereof, and
(f) when used with respect to an individual, shall include any member of such
individual's immediate family or a family trust.
AGREEMENT shall mean this Agreement as originally in effect,
including, unless the context otherwise specifically requires, this Appendix A,
the Xxxxx Disclosure Schedule and all exhibits hereto, and as any of the same
may from time to time be supplemented, amended, modified or restated in the
manner herein or therein provided.
APPLICABLE LAW shall mean any Law of any Authority, whether domestic
or foreign, including all federal and state securities Laws, to which a Person
is subject or by which it or any of its business or operations is subject or
any of its property or assets is bound.
ARBITRATION shall have the meaning given to it in Section 2.5.
ARBITRATOR shall have the meaning given to it in Section 2.5.
AUTHORITY shall mean any governmental or quasi-governmental authority,
whether administrative, executive, judicial, legislative or other, or any
combination thereof, including any federal, state, territorial, county,
municipal or other government or governmental or quasi-governmental agency,
arbitrator, authority, board, body, branch, bureau, or comparable agency or
Entity, commission, corporation, court, department, instrumentality, mediator,
panel, system or other political unit or subdivision or other Entity of any of
the foregoing, whether domestic or
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foreign, including the SEC, the Commodity Futures Trading Commission, the Board
of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation
or the Office of the Comptroller of the Currency.
BEACH EMPLOYMENT AGREEMENT shall have the meaning given to it in
Section 8.2.
BENEFIT ARRANGEMENT shall mean any material benefit arrangement that
is not a Plan, including (a) any employment or consulting agreement, (b) any
arrangement providing for insurance coverage or workers' compensation benefits,
(c) any incentive bonus or deferred bonus arrangement, (d) any arrangement
providing termination allowance, severance or similar benefits, (e) any equity
compensation plan, (f) any deferred compensation plan, and (g) any compensation
policy and practice, but only to the extent that it covers or relates to any
officer, employee or other Person involved in the ownership and operation of
the assets of Xxxxx or the conduct of the business of Xxxxx.
BIG FIVE ACCOUNTING FIRMS shall have the meaning given to it in
Section 2.5.
XXXXXX EMPLOYMENT AGREEMENT shall have the meaning given to it in
Section 8.2.
XXXXXX PROMISSORY NOTE shall have the meaning given to it in Section
2.2.
XXXXXX'X KNOWLEDGE (or words of similar import) shall mean the actual
knowledge of Xxxxxx, as such knowledge exists on the date of this Agreement and
from such date through the Closing Date, after a reasonable review of
appropriate Xxxxx records and after a reasonable inquiry of appropriate Xxxxx
officers, directors, employees and agents.
CLAIMS shall mean any and all debts, liabilities, obligations, losses,
damages, deficiencies, assessments and penalties, together with all Legal
Actions, pending or threatened, claims and judgments of whatever kind and
nature relating thereto, and all fees, costs, expenses and disbursements
(including reasonable attorneys' and other legal fees, costs and expenses)
relating to any of the foregoing.
CLOSING shall have the meaning given to it in Section 8.1.
CLOSING DATE shall have the meaning given to it in Section 8.1.
CLOSING DATE BALANCE SHEET shall have the meaning given to it in
Section 2.4.
COBRA shall mean the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, as set forth in Section 4980B of the Code and Part 6 of
Subtitle B of Title I of ERISA.
CODE shall mean the Internal Revenue Code of 1986, as the same has
been amended, and the rules and regulations thereunder, all as from time to
time in effect, or any successor law, rules or regulations, and any reference
to any statutory or regulatory provision shall be deemed to be a reference to
any successor statutory or regulatory provision.
COLLATERAL DOCUMENTS shall mean the Synagen Promissory Note, the
Xxxxxx Promissory Note, the Xxxxxxxxx Promissory Note, the Xxxxxx Employment
Agreement, the Beach
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Employment Agreement and any other agreement, certificate, contract,
instrument, notice or other document delivered pursuant to the provisions of
this Agreement or any Collateral Document.
CONFIDENTIAL INFORMATION shall have the meaning given to it in Section
7.1.
CONTRACT, CONTRACTUAL OBLIGATION shall mean any executory agreement,
arrangement, commitment, contract, covenant, indemnity, undertaking or other
obligation or liability to which Xxxxx or Intrepid, as the case may be, is a
party or to which any of the Xxxxx Assets or the Intrepid Assets, as the case
may be, is subject.
CONTROL (including the terms "controlled," "controlled by" and "under
common control with") shall mean the possession, directly or indirectly or as
trustee or executor, of the power to direct or cause the direction of the
management or policies of a Person, or the disposition of such Person's assets
or properties, whether through the ownership of stock, equity or other
ownership, by contract, arrangement or understanding, or as trustee or
executor, by contract or credit arrangement or otherwise.
CONVERTIBLE SECURITIES shall mean any evidences of indebtedness,
shares of capital stock (other than common stock) or other securities directly
or indirectly convertible into or exchangeable for shares of common stock,
whether or not the right to convert or exchange thereunder is immediately
exercisable or is conditioned upon the passage of time, the occurrence or
non-occurrence or existence or non-existence of some other Event, or both.
DISPUTED MATTERS shall have the meaning given to it in Section 2.5.
DISTRIBUTION shall mean, with respect to any Person, (a) the
declaration or payment of any dividend (except dividends payable in common
stock of such Person) on or in respect of any shares of any class of capital
stock of such Person or any shares of capital stock of any Subsidiary owned by
a Person other than such Person or a Subsidiary of such Person, (b) the
purchase, redemption or other retirement of any shares of any class of capital
stock of such Person or any shares of capital stock of any Subsidiary of such
Person owned by a Person other than such Person or a Subsidiary of such Person,
and (c) any other distribution on or in respect of any shares of any class of
capital stock of such Person or any shares of capital stock of any Subsidiary
of such Person owned by a Person other than such Person or a Subsidiary of such
Person.
EMPLOYMENT ARRANGEMENT shall mean any employment, consulting,
retainer, severance or similar contract, agreement, plan, arrangement or policy
(exclusive of any which is terminable within thirty (30) days without
liability, penalty or payment of any kind by Xxxxx or Intrepid, as the case may
be, or any Affiliate thereof), or providing for severance, termination
payments, insurance coverage (including any self-insured arrangements), workers
compensation, disability benefits, life, health, medical, dental or
hospitalization benefits, supplemental unemployment benefits, vacation or sick
leave benefits, pension or retirement benefits or for deferred compensation,
profit-sharing, bonuses, stock options, stock purchase or appreciation rights
or other forms of incentive compensation or post-retirement insurance,
compensation or post-retirement insurance, compensation or benefits, or any
collective bargaining or other labor
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agreement, whether or not any of the foregoing is subject to the provisions of
ERISA, but only to the extent that it covers or relates to any officer,
employee or other Person involved in the ownership or operation of the Xxxxx
Assets or the Intrepid Assets, as the case may be, or the conduct of the Xxxxx
Business or the Intrepid Business, as the case may be.
ENCUMBER shall mean to suffer, accept, agree to or permit the
imposition of a Lien.
ENTITY shall mean any corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust (inter vivos or
testamentary), estate of a deceased, insane or incompetent individual, business
trust, joint stock company, joint venture or other organization, entity or
business, whether acting in an individual, fiduciary or other capacity, or any
Authority.
ENVIRONMENTAL, HEALTH AND SAFETY LAWS means the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource
Conservation and Recovery Act of 1976, and the Occupational Safety and Health
Act of 1970, each as amended, together with all other laws (including rules,
regulations, codes, plans, injunctions, judgments, orders, decrees, rulings and
charges thereunder) of federal, state, local and foreign governments (and all
agencies thereof) concerning pollution or protection of the environment, public
health and safety, or employee health and safety, including laws relating to
emissions, discharges, releases, or threatened releases of pollutants,
contaminants or chemical, industrial, hazardous or toxic materials or waste
into ambient air, surface water, ground water or lands or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants or chemical, industrial,
hazardous or toxic materials or waste.
ERISA shall mean the Employee Retirement Income Security Act of 1974,
as the same has been amended, and the rules and regulations thereunder, all as
from time to time in effect, or any successor law, rules or regulations, and
any reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
ERISA AFFILIATE shall mean any Person that is treated as a single
employer with Xxxxx under Sections 414(b), (c), (m) or (o) of the Code or
Section 4001(b)(1) of ERISA.
EVENT shall mean the existence or occurrence of any act, action,
activity, circumstance, condition, event, fact, failure to act, omission,
incident or practice, or any set or combination of any of the foregoing.
XXXXX shall have the meaning given to it in the first Whereas
paragraph.
XXXXX ASSETS shall have the meaning given to it in Section 3.5.
XXXXX BUSINESS shall have the meaning given to it in Section 3.6.
XXXXX COMMON STOCK shall have the meaning given to it in the first
Whereas paragraph.
XXXXX DISCLOSURE SCHEDULE shall mean the Xxxxx Disclosure Schedule
dated as of the date hereof and heretofore delivered by Xxxxx to Intrepid.
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XXXXX EMPLOYEES shall have the meaning given it in Section 3.11.
XXXXX FINANCIAL STATEMENTS shall have the meaning given to it in
Section 3.3.
XXXXX REPORTS shall have the meaning given to it in Section 4.2.
XXXXX SHAREHOLDER(S) shall have the meaning given to such terms in the
Preamble.
XXXXX SHAREHOLDER'S KNOWLEDGE (or words of similar import) shall mean
the actual knowledge of any Xxxxx Shareholder, as such knowledge exists on the
date of this Agreement and from such date through the Closing Date, and, in the
case of Xxxxxx, only after a reasonable review of appropriate Xxxxx records and
after a reasonable inquiry of appropriate Xxxxx officers, directors, employees
or agents.
EXCHANGE ACT shall mean the Securities Exchange Act of 1934, as the
same has been amended, and the rules and regulations thereunder, all as from
time to time in effect, or any successor law, rules or regulations, and any
reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
FINAL ORDER shall mean, with respect to any Authority, one with
respect to which no appeal, no stay, no petition or application for rehearing,
reconsideration, review or stay, whether on motion of the applicable Authority
or other Person or otherwise, and no other Legal Action contesting such consent
or approval, is in effect or pending and as to which the time or deadline for
filing any such appeal, petition or application or other Legal Action has
expired or, if filed, has been denied, dismissed or withdrawn, and the time or
deadline for instituting any further Legal Action has expired.
GAAP shall mean generally accepted accounting principles applied on a
consistent basis, (i) as set forth in Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants ("AICPA")
and/or in statements of the Financial Accounting Standards Board that are
applicable in the circumstances as of the date in question, (ii) when not
inconsistent with such opinions and statements, as set forth in other AICPA
publications and guidelines and/or (iii) that otherwise arise by custom for the
particular industry, all as the same shall exist on the date of this Agreement.
GOVERNMENTAL AUTHORIZATIONS shall mean all approvals, concessions,
consents, franchises, licenses, permits, plans, registrations and other
authorizations of all Authorities, including the Securities and Exchange
Commission, the Commodity Futures Trading Commission, the Board of Governors of
the Federal Reserve, the Federal Deposit Insurance Corporation and the Office
of the Comptroller of the Currency, in connection with the ownership or
operation of the Xxxxx Assets or the Intrepid Assets, as the case may be, or
the conduct of the Xxxxx Business or the Intrepid Business, as the case may be.
GOVERNMENTAL FILINGS shall mean all filings, including franchise and
similar Tax filings, and the payment of all fees, assessments, interest and
penalties associated with such filings, with all Authorities.
XXXXXXXXX PROMISSORY NOTE shall have the meaning given to it in
Section 2.2.
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HOLDBACK AMOUNT shall have the meaning given to it in Section 2.2.
INDEBTEDNESS shall mean, with respect to any Person, (a) all items,
except items of capital stock or of surplus or of general contingency or
deferred tax reserves or any minority interest in any Subsidiary of such Person
to the extent such interest is treated as a liability with indeterminate term
on the consolidated balance sheet of such Person, which in accordance with GAAP
would be included in determining total liabilities as shown on the liability
side of a balance sheet of such Person, (b) all obligations secured by any Lien
to which any property or asset owned or held by such Person is subject, whether
or not the obligation secured thereby shall have been assumed, and (c) to the
extent not otherwise included, all Contractual Obligations of such Person
constituting capitalized leases and all obligations of such Person with respect
to Leases constituting part of a sale and leaseback arrangement.
INDEBTEDNESS FOR MONEY BORROWED shall mean money borrowed and
Indebtedness represented by notes payable and drafts accepted representing
extensions of credit, all obligations evidenced by bonds, debentures, notes or
other similar instruments, the maximum amount currently or at any time
thereafter available to be drawn under all outstanding letters of credit issued
for the account of such Person, all Indebtedness upon which interest charges
are customarily paid by such Person, and all Indebtedness issued or assumed as
full or partial payment for property or services, whether or not any such
notes, drafts, obligations or Indebtedness represent Indebtedness for money
borrowed, but shall not include (a) trade payables, (b) expenses accrued in the
ordinary course of business, (c) customer advance payments and customer
deposits received in the ordinary course of business, or (d) conditional sales
agreements not prohibited by the terms of this Agreement.
INDEMNIFIED PARTIES shall have the meaning given to it in Section
10.9.
INTANGIBLE ASSETS shall mean all assets and property lacking physical
properties the evidence of ownership of which must customarily be maintained by
independent registration, documentation, certification, recordation or other
means, and shall include concessions, copyrights, franchises, license, patents,
permits, service marks, trademarks, trade names, and applications with respect
to any of the foregoing, technology and know-how.
INTELLECTUAL PROPERTY shall mean any and all research, information,
inventions, designs, procedures, developments, discoveries, improvements,
patents and applications therefor, trademarks and applications therefor,
service marks, trade names, copyrights and applications therefor, logos, trade
secrets, drawings, plans, systems, methods, specifications, computer software
programs, tapes, discs and related data processing software (including object
and source codes) owned by such Person or in which it has an ownership interest
and all other manufacturing, engineering, technical, research and development
data and know-how made, conceived, developed and/or acquired by such Person,
which relate to the manufacture, production or processing of any products
developed or sold by such Person or which are within the scope of or usable in
connection with such Person's business as it may, from time to time, hereafter
be conducted or proposed to be conducted.
INTREPID shall have the meaning given to it in the Preamble.
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INTREPID ASSETS shall have the meaning given to it in Section 6.4.
INTREPID BUSINESS shall have the meaning given to it in Section 6.5.
INTREPID DISCLOSURE SCHEDULE shall mean the Intrepid Disclosure
Schedule dated as of the date hereof and heretofore delivered by Intrepid to
the Xxxxx Shareholders.
INTREPID FINANCIAL STATEMENTS shall have the meaning given to it in
Section 6.2.
INTREPID INDEMNIFIED PARTIES shall have the meaning given to it in
Section 10.2(a).
INTREPID'S KNOWLEDGE (or words of similar import) shall mean the
actual knowledge of any director or executive officer of Intrepid, as such
knowledge exists on the date of this Agreement and from such date through the
Closing Date.
INTREPID REPORTS shall have the meaning given to it in Section 6.6.
INTREPID REPRESENTATIVES shall have the meaning given to it in Section
7.1.
INTREPID SEC REPORTS shall have the meaning given to it in Section
6.2.
LAW shall mean (a) any administrative, judicial, legislative or other
action, code, consent decree, constitution, decree, directive, enactment,
finding, law, injunction, interpretation, judgment, order, ordinance, policy
statement, proclamation, promulgation, regulation, requirement, rule, rule of
law, rule of public policy, settlement agreement, statute or writ of any
Authority, domestic or foreign, (b) the common law, or other legal precedent,
or (c) any arbitrator's, mediator's or referee's award, decision, finding or
recommendation.
LEASE shall mean any lease of property, whether real, personal or
mixed, and all amendments thereto, and shall include all use or occupancy
agreements.
LEGAL ACTION shall mean, with respect to any Person, any and all
litigation or legal or other actions, arbitrations, counterclaims,
investigations, proceedings, requests for material information by or pursuant
to the order of any Authority or suits, at law or in arbitration, equity or
admiralty, whether or not purported to be brought on behalf of such Person,
affecting such Person or any of such Person's business, property or assets.
LIEN shall mean any of the following: mortgage; lien (statutory or
other); or other security agreement, arrangement or interest; hypothecation,
pledge or other deposit arrangement; assignment; charge; levy; executory
seizure; attachment; garnishment; encumbrance (including any easement,
exception, reservation or limitation, right of way, and the like); conditional
sale, title retention or other similar agreement, arrangement, device or
restriction; preemptive or similar right; any financing lease involving
substantially the same economic effect as any of the foregoing; the filing of
any financing statement under the Uniform Commercial Code or comparable law of
any jurisdiction; restriction on sale, transfer, assignment, disposition or
other alienation; or any option, equity, claim or right of or obligation to,
any other Person, of whatever kind and character.
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LOSS AND EXPENSE shall have the meaning given to it in Section
10.2(a).
MATERIAL, MATERIALLY OR MATERIALITY for the purposes of this
Agreement, shall, unless specifically stated to the contrary, be determined
without regard to the fact that various provisions of this Agreement set forth
specific dollar amounts.
MATERIAL AGREEMENT shall mean any Contractual Obligation which (a) was
not entered into in the ordinary course of business, (b) was entered into in
the ordinary course of business which (i) involved the purchase, sale or lease
of goods or materials, or purchase of services, aggregating more than $25,000
during any of the last three fiscal years, (ii) extends for more than three (3)
months, or (iii) is not terminable on sixty (60) days or less notice without
penalty or other payment, (c) involves a capitalized lease obligation or
Indebtedness for Money Borrowed in excess of $25,000 in any single instance,
(d) is or otherwise constitutes a written agency, broker, dealer, license,
distributorship, sales representative or similar written agreement, (e)
accounted for more than five percent (5%) of the revenues of the Xxxxx Business
or the Intrepid Business, as the context requires, in any of the last three
fiscal years or is likely to account for more than five percent (5%) of
revenues of the Xxxxx Business or the Intrepid Business, as the case may be,
during the current fiscal year, or (f) is with any Authority.
MULTIEMPLOYER PLAN shall mean a Plan which is a "multiemployer plan"
within the meaning of Section 4001(a)(3) of ERISA.
NASD shall mean The National Association of Securities Dealers, Inc.
NASD FINES shall have the meaning given to it in Section 2.2.
OPTION SECURITIES shall mean all stock appreciation rights, rights,
options and warrants, and calls or commitments evidencing the right, to
subscribe for, purchase or otherwise acquire shares of capital stock or
Convertible Securities, whether or not the right to subscribe for, purchase or
otherwise acquire is immediately exercisable or is conditioned upon the passage
of time, the occurrence or non-occurrence or the existence or non-existence of
some other Event.
ORGANIC DOCUMENT shall mean, with respect to a Person which is a
corporation, its Articles of Incorporation or other charter documents, its
by-laws and all shareholder agreements, voting trusts and similar arrangements
applicable to any of its capital stock and, with respect to a Person which is a
partnership, its agreement and certificate of partnership, any agreements among
partners, and any management and similar agreements between the partnership and
any general partners (or any Affiliate thereof).
PBGC shall mean the Pension Benefit Guaranty Corporation and any
Entity succeeding to any or all of its functions under ERISA.
PERMITTED INDEBTEDNESS shall mean any Indebtedness for Money Borrowed
of Xxxxx or other Excluded Liability outstanding as of the date hereof and
consented to in writing by Intrepid in its sole and absolute discretion.
PERMITTED LIENS shall mean (a) Liens for current taxes which are not
yet due and payable or are being contested in good faith and by appropriate
proceedings, and appropriate reserves
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therefor have been established, (b) such imperfections of title, easements,
encumbrances and mortgages or other Liens, if any, as are not, individually or
in the aggregate, substantial in character, amount or extent and do not
materially detract from the value, or materially interfere with the present
use, of the property subject thereto or affected thereby, or otherwise
materially impair the conduct of the Xxxxx Business or the Intrepid Business,
as applicable, and (c) such other Liens as are permitted by the provisions of
this Agreement to be in place on the Closing Date.
PERSON shall mean any natural individual or any Entity.
PLAN shall mean, with respect to any Person and at a particular time,
any employee benefit plan which is covered by ERISA and in respect of which
such Person or an ERISA Affiliate is (or, if such plan were terminated at such
time, would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA, but only to the extent that it covers or
relates to any officer, employee or other Person involved in the ownership and
operation of the Xxxxx Assets or the conduct of the business of the Xxxxx
Business.
PRIVATE AUTHORIZATIONS shall mean all approvals, concessions,
consents, franchises, licenses, permits, and other authorizations of all
Persons (other than Authorities) including those with respect to Intellectual
Property or to any Self-Regulatory Organization.
PRO RATA AMOUNT shall mean, with respect to any Xxxxx Shareholder,
such Xxxxx Shareholder's proportionate interest in the aggregate outstanding
capital stock of Xxxxx immediately as of the Closing, expressed as a
percentage.
REAL PROPERTY shall mean all of the fee estates and buildings and
other fixtures and improvements thereon, leasehold interest, easements,
licenses, rights to access, right-of-way, and other real property interests
which are owned or used by Xxxxx or Intrepid, as the case may be, as of the
date hereof in the operations of the Xxxxx Business or the Intrepid Business,
as the case may be.
REGULATIONS shall mean the federal income tax regulations promulgated
under the Code, as such Regulations may be amended from time to time. All
references herein to specific sections of the Regulations shall be deemed also
to refer to any corresponding provisions of succeeding Regulations, and all
references to temporary Regulations shall be deemed also to refer to any
corresponding provisions of final Regulations.
SEC shall mean the United States Securities and Exchange Commission.
SECURITIES ACT shall mean the Securities Act of 1933, as the same has
been amended, and the rules and regulations thereunder, all as from time to
time in effect, or any successor law, rules or regulations, and any reference
to any statutory or regulatory provision shall be deemed to be a reference to
any successor statutory or regulatory provision.
SELF-REGULATORY ORGANIZATION shall mean the NASD, The New York Stock
Exchange, the American Stock Exchange, the Chicago Stock Exchange, the
Philadelphia Stock Exchange, the Chicago Board of Trade, any other inter-dealer
quotation system or exchange, or any commission, board, agency or body that is
not an Authority but is charged with the supervision
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or regulation of brokers, dealers, securities underwriting or trading, stock
exchanges, commodities exchanges, insurance companies or agents, investment
companies or investment advisers.
SHARE PURCHASE shall have the meaning given to it in the second
Whereas paragraph.
SHARES shall have the meaning given to it in the first Whereas
paragraph.
SOLVENT shall mean, with respect to any Person on a particular date,
that such Person is "solvent" within the meaning of the federal Bankruptcy Code
and applicable state insolvency and fraudulent conveyance statutes.
SPRAYROQ shall have the meaning given to it in Section 6.1(d).
SUBSIDIARY shall mean, with respect to a Person, any Entity a majority
of the capital stock ordinarily entitled to vote for the election of directors
of which, or if no such voting stock is outstanding, a majority of the equity
interests of which, is owned directly or indirectly, legally or beneficially,
by such Person or any other Person controlled by such Person.
SYNAGEN PROMISSORY NOTE shall have the meaning given to it in Section
2.2.
TARGET EQUITY shall have the meaning given to it in Section 2.3.
TAX (and "Taxable", which shall mean subject to Tax), shall mean, with
respect to any Person, (a) all taxes (domestic or foreign), including any
income (net, gross or other including recapture of any tax items such as
investment tax credits), alternative or add-on minimum tax, gross income, gross
receipts, gains, sales, use, leasing, lease, user, ad valorem, transfer,
recording, franchise, profits, property (real or personal, tangible or
intangible), fuel, license, withholding on amounts paid to or by such Person,
payroll, employment, unemployment, social security, excise, severance, stamp,
occupation, premium, environmental or windfall profit tax, custom, duty or
other tax, or other like assessment or charge of any kind whatsoever, together
with any interest, levies, assessments, charges, penalties, addition to tax or
additional amount imposed by any Taxing Authority, (b) any joint or several
liability of such Person with any other Person for the payment of any amounts
of the type described in (a), and (c) any liability of such Person for the
payment of any amounts of the type described in (a) as a result of any express
or implied obligation to indemnify any other Person.
TAX RETURN OR RETURNS shall mean all returns, consolidated or
otherwise (including information returns), required to be filed with any
Authority with respect to Taxes.
TAXING AUTHORITY shall mean any Authority responsible for the
imposition of any Tax.
TRANSACTIONS shall mean the transactions contemplated to be
consummated on or prior to the Closing Date, including the Share Purchase and
the execution, delivery and performance of the Collateral Documents.
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