STOCK PURCHASE AGREEMENT, made as of the 27th day of February, 2003, by and
between XXXXXXX XXXXXXXXX (the "Buyer") and DCAP GROUP, INC. (the "Seller").
RECITALS
WHEREAS, DCAP Brentwood Inc., a New York corporation (the "Company"),
having its principal place of business at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx
Xxxx 00000 (the "Premises"), was duly organized under and by virtue of the laws
of the State of New York.
WHEREAS, the Seller is the owner of one hundred (100) shares of Common
Stock, without par value, of the Company (the "Shares") which represents all of
the Company's issued and outstanding shares.
WHEREAS, the Seller desires to sell, and the Buyer desires to purchase, all
of the Shares subject to the terms and conditions set forth herein.
NOW, THEREFORE, the parties agree as follows:
1. Sale of Stock; Franchise Agreement. (a) For and in consideration of the
Purchase Price (as hereinafter defined), the Seller hereby sells to the Buyer,
and the Buyer hereby purchases from the Seller, all of the Shares.
(b) The aggregate purchase price for the Shares is One Hundred Fifteen
Thousand Four Hundred Thirty-Seven Dollars ($115,437) (the "Purchase Price"),
payable by certified check simultaneously with the execution and delivery of
this Agreement.
(c) Concurrently herewith, the Company and the Buyer are entering into
a Franchise Agreement with DCAP Management Corp. ("Management"), a wholly-owned
subsidiary of the Seller (the "Franchise Agreement").
2. Representations of the Seller. The Seller represents and warrants to the
Buyer as follows:
(a) Ownership of Shares. The Seller is the sole owner and holder of
the Shares, free and clear of all liens and encumbrances of any kind whatsoever
(collectively, "Liens"), and the Shares have not been assigned, pledged or
otherwise hypothecated.
(b) Capitalization.
(i) The authorized capital stock of the Company consists of 200
shares of Common Stock, no par value, 100 of which are issued and outstanding
and held by the Seller.
(ii) There are no subscriptions, options, warrants, rights, calls
or other commitments to which the Company or the Seller is a party, or by which
either is bound, calling for the issuance, sale, transfer or other disposition
of any class of securities of the Company and there are no outstanding
securities or instruments of the Company convertible into or exchangeable for
shares of Common Stock or any other securities of the Company. The Certificate
of Incorporation of the Company has not been cancelled or revoked nor has the
Company been dissolved.
(c) Assets. The Company's assets are free and clear of all Liens,
except for those leases described on Schedule A attached hereto. The Company has
the following telephone number: 000-000-0000.
(d) Consents. No consent of any governmental or other regulatory
agency, court or third party is required to be received by or on the part of the
Seller to enable it to enter into and carry out this Agreement and the
transactions contemplated hereby.
(e) Authority; Binding Nature of Agreement. The Seller has the power
to enter into this Agreement and to carry out its obligations hereunder. This
Agreement constitutes the valid and binding obligation of the Seller, and is
enforceable in accordance with its terms.
(f) No Breach. Neither the execution and delivery of this Agreement,
nor compliance by the Seller with any of the provisions hereof, nor the
consummation of the transactions contemplated hereby, will:
(i) violate any provision of the Certificate of Incorporation or
By-Laws, each as amended, of the Seller;
(ii) violate any judgment, order, injunction, decree or award
against, or binding upon, the Seller;
(iii) violate or otherwise breach the terms of any agreement or
understanding, written or oral, to which the Seller is a party or is otherwise
bound; or
(iv) violate any law or regulation of any jurisdiction relating
to the Seller.
(g) Brokers. The Seller has not engaged, consented to, or authorized
any broker, finder, investment banker or other third party to act on its behalf,
directly or indirectly, as a broker or finder in connection with the
transactions contemplated by this Agreement.
(h) Litigation. There are no lawsuits pending against the Company
other than actions which may be pending which are covered by insurance, nor, to
the knowledge of the Seller, are there any actions threatened to be instituted
against the Company, nor are there any judgments, warrants or levies outstanding
against the Company or any of its property, nor, to the knowledge of the Seller,
are there any tax examinations or proceedings pending relating to taxes or
assessments against the Company, nor has the Company taken any action in the
nature of an insolvency proceeding.
(i) Premises. The Company is in possession of the Premises under a
written lease between Son Realty, as landlord, and the Company, as tenant, which
lease, together with any modifications, shall be provided to the Buyer.
(j) Taxes. Any and all tax reports required to be filed by the Company
to date hereof have been filed, and all monies required to be paid thereunder
have been paid.
(k) Indebtedness. The Company is not indebted to any party, nor is it
a party to any executory contracts, except as described on Schedule A.
(l) Orders. To our knowledge, there are no outstanding requests or
orders from the New York Board of Fire Underwriters with respect to the
Premises.
(m) Union Contracts. The Company has no union contracts.
(n) Notices of Violation. As of the date hereof, to our knowledge,
there are no notices of violation of record with any governmental authority
having jurisdiction over the Premises or the Company's business.
3. Representations of the Buyer. The Buyer represents and warrants to the
Seller as follows:
(a) Consents. No consent of any governmental or other regulatory
agency, court or third party is required to be received by or on the part of the
Buyer to enable him to enter into and carry out this Agreement or the Franchise
Agreement and the transactions contemplated hereby or thereby.
(b) Authority; Binding Nature of Agreement. The Buyer has the power to
enter into this Agreement, and the Franchise Agreement and to carry out his
obligations hereunder and thereunder. This Agreement and the Franchise Agreement
constitute the valid and binding obligations of the Buyer, and are enforceable
in accordance with their respective terms.
(c) No Breach. Neither the execution and delivery of this Agreement or
the Franchise Agreement, nor compliance by the Buyer with any of the provisions
hereof or thereof, nor the consummation of the transactions contemplated hereby
or thereby, will:
(i) violate any judgment, order, injunction, decree or award
against, or binding upon, the Buyer;
(ii) violate or otherwise breach the terms of any agreement or
understanding, written or oral, to which the Buyer is a party or is otherwise
bound; or
(iii) violate any law or regulation of any jurisdiction relating
to the Buyer.
(d) Brokers. The Buyer has not engaged, consented to, or authorized
any broker, finder, investment banker or other third party to act on his behalf,
directly or indirectly, as a broker or finder in connection with the
transactions contemplated by this Agreement.
(e) Litigation. The Buyer acknowledges and agrees that, prior to the
date hereof, the Company assigned to an affiliate of the Seller all of its
rights under, in connection with and relating to a certain cause of action
brought by the Company against Xxxxxx Xxxxxxxxx and that neither the Company nor
the Buyer shall have any rights with regard thereto.
4. Closing.
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(a) Time and Location. The closing (the "Closing") provided for herein
shall take place simultaneously with the execution of this Agreement at the
offices of Certilman Balin Xxxxx & Xxxxx, LLP, 00 Xxxxxxx Xxxxxx, Xxxx Xxxxxx,
Xxx Xxxx 00000 or at such other time and place as may be mutually agreed to by
the parties.
(b) Items to be Delivered by the Seller. At the Closing, the Seller
will deliver or cause to be delivered to the Buyer:
(i) certificate(s) representing the Shares, together with stock
powers, duly executed by the Seller;
(ii) the resignation of each officer and director of the Company;
and
(iii) the Franchise Agreement, executed on behalf of Management.
(c) Items to be Delivered by the Buyer. At the Closing, the Buyer will
deliver or cause to be delivered to the Seller:
(i) a certified check payable to the order of the Seller in the
amount of the Purchase Price; and
(ii) the Franchise Agreement executed on behalf of the Company
and by the Buyer.
5. Post-Closing Covenants. (a) The Seller agrees that, within five (5)
days following the date hereof (or within five (5) days of receipt of an
invoice, with respect to invoices received on or after the date hereof), it
shall satisfy all accounts payable (including amounts due under leases and
finance agreements, if any) of the Company incurred prior to the date hereof.
(b) The Buyer acknowledges and agrees that the Seller shall not be
responsible for any other obligations of the Company, including, without
limitation, with respect to returned commissions as to which bills or commission
statements are received from the insurance carrier on
or after the date hereof.
(c) The Seller acknowledges and agrees that all commissions received
by the Company after the date of Closing shall be the sole property of the
Company, regardless of how they may have been booked by the Seller.
6. Indemnification. The Seller hereby agrees that it shall indemnify and
hold harmless the Buyer (including reasonable attorney fees) from and against
any and all claims, including taxes, that accrued prior to the Closing date and
shall further assume the prompt payment of all obligations of the Company due
and owing and/or accruing prior to the Closing date, except for return
commissions as provided for herein.
The Seller specifically assumes and agrees to pay all taxes, interest and
penalties payable by the Company, including, but not limited to, New York State
sales taxes, if any, for any period ending prior to the Closing date.
If any claim should be made against the Company or the Buyer for the
payment of any obligations which, under the terms of the aforesaid indemnity,
the Seller would be liable, the Buyer shall give the Seller prompt notice
thereof by certified or registered mail, return receipt requested. Within
fifteen (15) days after such notice, the Seller shall notify the Buyer whether
or not the Seller intends to defend such claim. The Seller shall have the right
to contest any such claim at the Seller's cost and expense. If the Seller fails
to defend any such claim, then the Company or its designee shall be entitled to
receive from the Seller all reasonable costs and expenses incurred by it in the
defense and in the satisfaction of any such claims, including, but not limited
to, reasonable attorney fees.
If there are any security interests on record at the time of Closing, other
than those to which the Buyer has agreed to take subject, the Seller shall
indemnify and hold harmless the Buyer from the obligations forming the basis of
the security interests.
If there are any violations of record against the Premises at the time
of Closing, recorded on or before the date hereof, the Seller agrees to cause
such violation to be cured and removed of record at the Seller's cost and
expense, by the performance of such work, labor and services and/or taking of
such action as may be necessary promptly after the Closing hereof.
At Closing, the Seller shall assume all of the debts and obligations
incurred and existing as of the Closing date, other than those liens the Buyer
will assume or shall have agreed to take title subject to.
All representations of the Seller, including, but not limited to, the
indemnification and hold harmless agreement contained herein shall survive the
closing and transfer of the Shares to the Buyer for a period of two (2) years.
7. Amendment. Neither this Agreement nor any term or provision hereof may
be changed, waived, discharged, or terminated orally, or in any manner other
than by an instrument in writing signed by the party against which the
enforcement of the change, waiver, discharge, or
termination is sought.
8. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the respective parties, and their successors and assigns, heirs and
personal representatives.
9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original.
10. Entire Agreement. This Agreement constitutes the entire understanding
between the parties with respect to its subject matter and supersedes any
previous written or oral agreement with respect thereto. The representations,
warranties and covenants set forth in this Agreement constitute all of the
representations, warranties and covenants of the parties and upon which the
parties have relied.
11. Construction. This Agreement is made under and shall be construed in
accordance with the laws of the State of New York applicable to contracts made
and performed within the State of New York.
12. Notices. Any and all notices or other communications or deliveries
required or permitted to be given or made pursuant to any of the provisions of
this Agreement shall be deemed to have been duly given or made for all purposes
when hand delivered or sent by certified or registered mail (return receipt
requested, postage prepaid), facsimile transmission, or overnight mail or
courier, addressed as follows:
If to the Seller, at:
0000 Xxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: Chief Executive Officer
Telecopier Number: (000) 000-0000
With copy to:
Certilman Balin Xxxxx & Xxxxx, LLP
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
If to the Buyer, at:
000 Xxxxx Xxxxxxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Telecopier Number: (000) 000-0000
With a copy to:
Weil & Xxxxxxxxxx
00-00 Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
Telecopier Number: (000) 000-0000
or at such other address as any party may specify by notice given to the other
parties in accordance with this Section 12.
13. Further Assurances. On or after the date hereof, the parties shall
take all such further actions and execute and deliver all such further
instruments and documents as may be necessary or appropriate to carry out the
transactions contemplated by this Agreement.
14. Severability. In the event any clause, section or part of this
Agreement shall be held or declared to be void, illegal or invalid for any
reason, all other clauses, sections or parts of this Agreement which can be
effected without such void, illegal or invalid clause, section or part shall
nevertheless continue in full force and effect.
15. Headings. The headings or captions in this Agreement are for
convenience of reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.
16. Representation by Counsel; Interpretation. Each party acknowledges
that he or it has been represented by counsel, or has been afforded the
opportunity to be represented by counsel, in connection with this Agreement and
the transactions contemplated hereby. Accordingly, any rule or law or any legal
decision that would require the interpretation of any claimed ambiguities in
this Agreement against the party that drafted it has no application and is
expressly waived by the parties. The provisions of this Agreement shall be
interpreted in a reasonable manner to give effect to the intent of the parties
hereto.
Remainder of page intentionally left blank. Signature page follows.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
DCAP GROUP, INC.
By: /s/ Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
Chief Executive Officer
/s/ Xxxxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxxxxx
Schedule A
Lease Lease expiration date
o Avaya (telephone system) - $43.54/month 05/25/03
o Advanta Leasing (fax machine) - $153.70/month 01/05
(option to purchase at fair market value)
o Xxxx-Xxxx Al 1515 - $89.00/month 04/05
(option to purchase for $1.00)
Other Executory Contracts
Burglar alarm
Window cleaning
