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Exhibit 10.1
EXECUTION COPY
ASSET PURCHASE AGREEMENT
dated as of May 6, 1997
by and between
TRI-STATE SYSTEMS, INC.
and
TRI-STATE OUTDOOR MEDIA GROUP, INC.
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TABLE OF CONTENTS
1. DEFINITIONS.......................................................... 1
2. PURCHASE AND SALE OF THE ASSETS...................................... 1
2.1 Agreement to Purchase and Sell................................. 1
2.2 Purchased Assets............................................... 1
2.3 Excluded Assets................................................ 3
2.4 Agreement to Assume Certain Liabilities........................ 3
2.5 Excluded Liabilities........................................... 4
2.6 Closing........................................................ 5
2.7 Purchase Price................................................. 5
2.8 Transactions at the Closing.................................... 5
3. REPRESENTATIONS AND WARRANTIES OF SELLER............................. 6
3.1 Organization and Good Standing................................. 6
3.2 Authority of Seller and the Stockholders; No Conflict.......... 6
3.3 Solvency....................................................... 7
3.4 Books and Records.............................................. 7
3.5 Structures..................................................... 7
3.6 Permits........................................................ 7
3.7 Site Leases.................................................... 7
3.8 Owned Real Property............................................ 8
3.9 Title, Encumbrances............................................ 8
3.10 Financial Statements........................................... 8
3.11 Taxes.......................................................... 9
3.12 Compliance with Legal Requirements............................. 10
3.13 Legal Proceedings; Orders...................................... 10
3.14 Other Contracts................................................ 10
3.15 Insurance...................................................... 10
3.16 [Intentionally Omitted]........................................ 10
3.17 Intangible Property............................................ 10
3.18 Relationships with Affiliates.................................. 10
3.19 Brokers or Finders............................................. 10
3.20 Employee Benefit Matters....................................... 11
3.21 Employees: Labor Matters....................................... 11
3.22 No Undisclosed Liabilities..................................... 11
3.23 Absence of Certain Changes..................................... 12
3.24 Accounts Receivable............................................ 12
3.25 Certain Contracts.............................................. 12
3.26 WARN ACT LIABILITIES........................................... 13
3.27 NON-DISCLOSURE AGREEMENTS...................................... 13
3.28 INDEBTEDNESS AND SECURITY INTEREST............................. 13
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3.29 Disclosure..................................................... 13
4. REPRESENTATIONS AND WARRANTIES OF BUYER.............................. 13
4.1 Organization and Good Standing................................. 13
4.2 Authority; No Conflict......................................... 13
4.3 Certain Proceedings............................................ 14
4.4 Brokers or Finders............................................. 14
4.5 HSR............................................................ 14
5. COVENANTS OF SELLER.................................................. 14
5.1 Access and Investigation....................................... 14
5.2 Operation of the Purchased Assets.............................. 14
5.3 Best Efforts................................................... 16
5.4 Required Approvals............................................. 16
5.5 Notification................................................... 16
5.6 No Negotiation................................................. 16
5.7 Cooperation; Books and Records................................. 16
5.8 Tax Clearance.................................................. 16
6. COVENANTS OF BUYER................................................... 17
6.1 Required Approvals............................................. 17
6.2 Best Efforts................................................... 17
6.3 Notification................................................... 17
6.4 COBRA Continuation Coverage.................................... 17
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE.................. 17
7.1 Accuracy of Representations.................................... 18
7.2 Seller's Performance........................................... 18
7.3 Consents....................................................... 18
7.4 Additional Documents........................................... 18
7.5 No Proceedings................................................. 18
7.6 No Prohibition................................................. 18
7.7 No Material Adverse Change..................................... 18
7.8 Satisfaction of Indebtedness................................... 18
7.9 Non-Solicitation Agreements.................................... 19
7.10 Billboard Income............................................... 19
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE................. 19
8.1 Accuracy of Representations.................................... 19
8.2 Buyer's Performance............................................ 19
8.3 Additional Documents........................................... 19
8.4 No Proceedings................................................. 19
8.5 No Prohibition................................................. 20
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9. TERMINATION.......................................................... 20
9.1 Termination Events............................................. 20
9.2 Effect of Termination.......................................... 20
10. INDEMNIFICATION; REMEDIES............................................ 21
10.1 Indemnification and Payment of Damages by the
Indemnifying Stockholders...................................... 21
10.2 Indemnification and Payment of Damages by Buyer................ 21
10.3 Procedure for Indemnification -- Third Party Claims............ 22
10.4 Procedure for Indemnification -- Other Claims.................. 22
10.5 Survival/Limitations........................................... 23
11. GENERAL PROVISIONS................................................... 23
11.1 Expenses....................................................... 23
11.2 Public Announcements........................................... 23
11.3 [Intentionally Omitted]........................................ 24
11.4 Notices........................................................ 24
11.5 Further Assurances............................................. 25
11.6 Waiver......................................................... 25
11.7 Entire Agreement and Modification.............................. 25
11.8 Assignments, Successors, and No Third-Party Rights............. 25
11.9 Accounts Receivable............................................ 26
11.10 Severability................................................... 26
11.11 Risk of Loss................................................... 26
11.12 Post-Closing Access............................................ 26
11.13 Headings; Construction......................................... 26
11.14 Applicable Law................................................. 26
11.15 Incorporation of Exhibits and Schedules........................ 27
11.16 Counterparts................................................... 27
11.17 Jurisdiction and Consent to Service............................ 27
EXHIBITS
Exhibit A - Definitions
Exhibit B - Assignment of Contracts
Exhibit C - Xxxx of Sale, Assignment and Assumption Agreement
Exhibit D - Affirmation
Exhibit E - Pro Rata Indemnification
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SCHEDULES
Schedule 2.2(a) - Structures; Permits
Schedule 2.2(c) - Owned Real Property
Schedule 2.2(d) - Site Leases
Schedule 2.2(f) - Tangible Personal Property
Schedule 2.2(h) - Advertising Contracts
Schedule 2.7 - Addition to Purchase Price
Schedule A.1 - Exclusions From Accounts Payable
DISCLOSURE SCHEDULE
Part 3.2 Part 3.9(a) Part 3.18
Part 3.5 Part 3.9(b) Part 3.20
Part 3.6 Part 3.11 Part 3.21
Part 3.7 Part 3.13 Part 3.22
Part 3.8(b) Part 3.14 Part 3.25
Part 3.15 Part 3.28
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is entered into as of May 6,
1997 by and between TRI-STATE SYSTEMS, INC., a Georgia corporation ("Seller"),
TRI-STATE OUTDOOR MEDIA GROUP, INC., a Kansas corporation ("Buyer") and all of
the Indemnifying Stockholders (as defined below) of Seller. (Buyer, Seller and
the Indemnifying Stockholders are sometimes herein referred to individually as a
"Party" and collectively as the "Parties.")
RECITALS
Seller is engaged in the business of owning and operating outdoor signs,
billboards and benches and otherwise providing outdoor advertising services (the
"Business"). Seller desires to sell and assign all assets necessary and/or used
in connection with the Business (except the Excluded Assets, as hereinafter
defined) (the "Purchased Assets") to Buyer, and Buyer desires to purchase such
assets and to assume certain liabilities associated with such assets, pursuant
to the terms, conditions, limitations and exclusions contained in this
Agreement.
AGREEMENT
The Parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the terms listed on Exhibit A attached
hereto have the meanings specified or referred to in Exhibit A.
2. PURCHASE AND SALE OF THE ASSETS
2.1 AGREEMENT TO PURCHASE AND SELL. Subject to the terms and conditions of
this Agreement, Seller hereby agrees to grant, sell, assign, transfer, convey
and deliver all right, title and interest in and to the Purchased Assets, free
and clear of any liens, title claims, Encumbrances or Security Interests (except
as otherwise specifically permitted pursuant to the provisions of this
Agreement), and Buyer hereby agrees to buy and acquire the Purchased Assets from
Seller, and to assume the Assumed Liabilities upon the terms and conditions set
forth in this Agreement.
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2.2 PURCHASED ASSETS. The Purchased Assets include, without limitation,
the following:
(a) all of the billboard displays, benches and other out-of-home
advertising structures, together with all components, fixtures, parts,
appurtenances, and equipment attached to or made a part thereof that are
existing, under construction or for which Seller has any rights (collectively,
the "Structures"), including, without limitation, all of the Structures listed
on Schedule 2.2(a);
(b) all state and local licenses or permits/tags which Seller has
with respect to the Business and all other Governmental Authorizations that are
required for the operation of the Business (collectively, the "Permits"),
including, without limitation, all of the Permits listed on Schedule 2.2(a);
(c) all of the real property owned in fee by Seller and any rights
therein, including, without limitation, all of the real property listed on
Schedule 2.2(c), and all buildings, facilities, structures, fixtures, leasehold
and other improvements located therein, and all rights under the J.G.A. Lease
(collectively, the "Owned Real Property");
(d) all leases, licenses, easements, other rights of ingress or
egress, and all other grants of the right to place, construct, own, operate or
maintain the Structures on land, buildings and other real property owned by
third parties, and all rights therein (collectively, the "Site Leases"),
including, without limitation, all of the Site Leases listed on Schedule 2.2(d);
(e) all Books and Records;
(f) all tangible personal property, including furniture, vehicles,
machinery, equipment, computer hardware and software, owned by Seller and used
in the operation of the Business (collectively, the "Tangible Personal
Property"), including, without limitation, all of the Tangible Personal Property
listed on Schedule 2.2(f);
(g) accounts receivable, prepaid items and expenses and other assets
of Seller used in the Business that would be reflected as current assets on a
balance sheet of Seller as of the Closing Date prepared in a manner consistent
with Section 3.10(a), but excluding cash and cash equivalents;
(h) all of the rights under existing and pending sales and
advertising contracts associated with the Business, all rights to the
advertising copy displayed on the Structures as of the Closing Date, all other
rights to collect and receive income from the use of the Structures and security
deposits, if any, with respect thereto (collectively, the "Advertising
Contracts") including, without limitation, all of the Advertising Contracts
listed on Schedule 2.2(h);
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(i) all additional supplies used in connection with the Business,
including, without limitation, panels, moldings, steel components, sections,
parts, paint and painting supplies, appurtenances, equipment, electrical
connections, wiring and lighting components;
(j) the Intangible Property;
(k) the Other Contracts;
(l) the Current Proceedings;
(m) the Non-Solicitation Agreements; and
(n) all rights (including any benefits arising therefrom), causes of
action, claims and demands of whatever nature (whether or not liquidated) of
Seller relating to the Purchased Assets described in subparagraphs 2.2(a)-(m)
above, including, without limitation, condemnation rights and proceeds accruing
after the Closing, and all rights against suppliers under warranties covering
any of the same.
2.3 EXCLUDED ASSETS. Notwithstanding anything to the contrary herein
contained, the Purchased Assets shall not include the following assets, which
assets shall be retained by Seller ("Excluded Assets"):
(a) all cash and cash equivalents as of the Closing;
(b) the furniture and equipment located in Seller's Atlanta office
and/or in the apartment of Seller's president in Tifton, Georgia and the
automobile driven by Seller's President; and
(c) such Owned Real Property that Buyer elects not to purchase
pursuant to Section 2.8(a).
2.4 AGREEMENT TO ASSUME CERTAIN LIABILITIES. At the Closing, Buyer shall
assume and agree to discharge and perform all liabilities and obligations of
Seller, except Excluded Liabilities, incurred in the Ordinary Course of Business
of Seller before or after the Closing, including, without limitation:
(a) all current liabilities reflected on the December Balance Sheet
(but not including any Excluded Balance Sheet Liabilities) which remain unpaid
and undischarged on the Closing Date;
(b) all liabilities of Seller which are of the same kind and nature
as those assumed pursuant to Section 2.4(a) above to the extent arising in the
Ordinary Course of Business between December 31, 1996 and the Closing Date to
the extent the same remain unpaid and
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undischarged on the Closing Date, provided, however, that Excluded Trade
Payables and Excluded Sales Commissions shall not be assumed;
(c) all liabilities and obligations of Seller with respect to the
Structures, Site Leases, Permits, Advertising Contracts, Non-Solicitation
Agreements and Assumed Other Contracts to the extent arising in the Ordinary
Course of Business whether before or after the Closing;
(d) all liabilities and obligations of Seller under the Site Leases,
Advertising Contracts, Non-Solicitation Agreements and Assumed Other Contracts,
including all obligations under the Courtesy Leases, to the extent the same are
performable on or after the Closing and accrue on or after the Closing;
(e) liabilities and obligations in respect of the Current
Proceedings;
(f) COBRA Continuation Coverage for Seller's employees; and
(g) liabilities of the kind shown on Schedule A.1 arising on or
after the Closing and to the extent set forth on Schedule A.1 arising prior to
the Closing .
The liabilities described in this Section 2.4 are collectively referred to as
"Assumed Liabilities." The assumption by Buyer of any Assumed Liabilities shall
not be deemed to modify or amend Seller's representations and warranties
contained herein or in any way impair Buyer's right to rely upon such
representations and warranties or to obtain indemnification pursuant to Article
10 hereof for any breach of such representations and warranties.
2.5 EXCLUDED LIABILITIES. All claims against and liabilities and
obligations of Seller not specifically assumed by Buyer pursuant to Section 2.4,
including, without limitation, the following claims against and liabilities of
Seller, are excluded, and shall not be assumed or discharged by Buyer, and shall
be discharged in full when due by Seller:
(a) any liabilities (other than those with respect to the on-site
location itself, which the Parties agree are neither Assumed Liabilities nor
Excluded Liabilities hereunder) under the Environmental Laws to third parties to
the extent arising from Seller (its agent, employees or contractors) removing to
an offsite location, or disposing of Hazardous Materials before the Closing from
any location used in the Business and personal injury claims arising from the
same;
(b) any liabilities to the extent not attributable to the Purchased
Assets arising before or after the Closing;
(c) any liability attributable to the Purchased Assets before the
Closing that did not arise in the Ordinary Course of Business of Seller;
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(d) any liability of Seller for Income Taxes or payroll Taxes
arising prior to or from the sale of the Purchased Assets under this Agreement;
(e) any liabilities for or related to indebtedness of Seller to
Xxxxxx, other long-term bank debt and/or other secured indebtedness;
(f) any liabilities of Seller for or with respect to any employees
of Seller, except COBRA Continuation Coverage, including, without limitation,
payroll Taxes, any liabilities pursuant to any compensation (excepting,
specifically, the Assumed Sales Commissions), collective bargaining, pension,
retirement, severance, termination, or other benefit plan (excepting any such
liabilities created by Buyer after the Closing or before the Closing pursuant to
the authority granted in Section 3.21).
(g) the Excluded Trade Payables and the Excluded Sales Commissions.
The liabilities described in this Section 2.5 are collectively referred to as
"Excluded Liabilities."
2.6 CLOSING. The purchase and sale of the Purchased Assets (the "Closing")
provided for in this Agreement will take place at the offices of Buyer's lender,
on or before June 12, 1997, or such other time and place as the Parties may
agree (the "Closing Date"). The effective time of the Closing shall be 12:01
a.m., Eastern Standard Time, on the Closing Date.
2.7 PURCHASE PRICE. In consideration for the Purchased Assets, Buyer shall
assume the Assumed Liabilities, and pay an amount equal to the sum of Thirty-One
Million Dollars ($31,000,000). The Purchase Price shall be increased by the
amounts listed on Schedule 2.7 and any additional items hereafter added to this
Schedule and initialled by both Buyer and Seller. The Parties agree to cooperate
with each other in determining and reaching an agreement in writing on the
allocation of the Purchase Price among the Purchased Assets on or prior to
Closing in accordance with the provisions of Section 1060 of the IRC. Buyer and
Seller also each agree to file IRS form 8594 consistently with the foregoing and
in accordance with Section 1060 of the IRC. Buyer and Seller each agree not to
file any document with any Governmental Body that conflicts in any way with the
agreed-upon allocation of the Purchase Price.
2.8 TRANSACTIONS AT THE CLOSING. The following transactions shall take
place at the Closing:
(a) Seller shall deliver to Buyer (i) the Xxxx of Sale, (ii) the
Assignment of Contracts, (iii) the Deeds and all applicable documentary stamp or
real estate transfer taxes payable in connection with the conveyance of Owned
Real Property, and (iv) other instruments of transfer, evidence of consent and
all other related documents as may be necessary to evidence or perfect the sale,
assignment, transfer, and conveyance of good title to all of the Purchased
Assets as provided for herein; provided, however, that Buyer, by written notice
to Seller, may elect not to acquire all or any of the Owned Real Property.
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(b) Buyer shall deliver to Seller the Purchase Price by wire
transfer of immediately available funds, and such assumption agreements,
instruments and other documents as may be necessary to evidence the assumption
by Buyer of the Assumed Liabilities.
(c) The Parties shall also deliver to each other the agreements,
instruments, opinions, certificates, and other documents referred to in this
Agreement.
2.9 FURTHER ASSURANCES. Seller from time to time after the Closing at the
request of Buyer and without further consideration shall execute and deliver
further instruments of transfer and assignment and take such other action as
Buyer may reasonably require to effectively transfer and assign to, and vest in,
Buyer each of the Purchased Assets.
3. REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller represents and warrants to Buyer as follows:
3.1 ORGANIZATION AND GOOD STANDING. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of its
incorporation, with full power and authority to conduct the Business as it is
now being conducted, to own or use the Purchased Assets, and to perform all its
obligations. The Seller will deliver to Buyer prior to Closing true and complete
copies of its Organizational Documents, as currently in effect, and Seller is
not in violation of any of the provisions thereof. Seller is duly qualified or
licensed and in good standing to do business in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business conducted
by it makes such qualification necessary. Seller has no subsidiaries. Seller
does not own any securities issued by any other business, organization or
governmental authority, except U.S. Government securities, bank certificates of
deposit or money market accounts acquired as short-term investments in the
ordinary course of its business.
3.2 AUTHORITY OF SELLER AND THE STOCKHOLDERS; NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of the Seller, enforceable against Seller in accordance with its
terms. Upon the execution and delivery by the Seller of any Closing Documents to
be executed at Closing pursuant to this Agreement, such Closing Documents will
constitute the legal, valid, and binding obligations of the Seller, enforceable
against Seller in accordance with their respective terms. The Seller has the
absolute and unrestricted right, power and authority to execute and deliver this
Agreement and the Closing Documents to which it is a Party and to perform its
obligations thereunder. The execution, delivery and performance of this
Agreement has been duly authorized by the Seller's Board of Directors and the
Stockholders. The Stockholders own beneficially and of record all of the
outstanding capital stock of Seller (the "Shares"). Except as set forth in Part
3.2(a) of the Disclosure Schedule, there are no voting agreements, trusts,
proxies or other agreements, instruments or undertakings with respect to the
voting of any of Seller's Shares to which Seller or any of the Indemnifying
Stockholders is a party.
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(b) Except as set forth in Part 3.2(b) of the Disclosure Schedule,
neither the execution and delivery by the Seller or the Indemnifying
Stockholders of this Agreement nor the consummation or performance by the Seller
or the Indemnifying Stockholders of any of the Contemplated Transactions will:
(i) conflict with, violate or result in a breach of (A) any
provision of the Organizational Documents of the Seller; (B) any Legal
Requirement or any Order to which the Seller or any of the Purchased
Assets may be subject; or (C) any Governmental Authorization held by the
Seller or that otherwise relates to the Purchased Assets; or
(ii) contravene, conflict with, or result in a violation or
breach of any provision of, or give any Person the right to declare a
default or exercise any remedy under, or to accelerate the maturity or
performance of, or to cancel, terminate, or modify any Contract to which
the Seller is a Party or by which the Seller may be bound, or any interest
or rights of Seller in or to the Purchased Assets; or result in the
imposition or creation of any Encumbrance upon or with respect to any of
the Purchased Assets.
(c) Except as set forth in Part 3.2(c) of the Disclosure Schedule,
the Seller is not and will not be required to give any notice to or obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.
3.3 SOLVENCY. By consummating the transactions contemplated hereby, Seller
does not intend to hinder, delay or defraud any of Seller's present or future
creditors. Before giving effect to the transactions contemplated hereby, Seller
has been paying its debts and discharging its liabilities and obligations in the
Ordinary Course of Business and, after giving effect to the transactions
contemplated hereby, Seller intends to pay or discharge all of its respective
debts (or make adequate provision for the payment thereof), including, without
limitation, the Excluded Liabilities.
3.4 BOOKS AND RECORDS. The books of account, and other Books and Records
of Seller maintained in connection with the Purchased Assets are complete and
correct in all material respects and have been maintained in accordance with
sound business practices.
3.5 STRUCTURES. Except as set forth in Part 3.5 of the Disclosure
Schedule, (i) Seller owns all of the Structures, (ii) each Structure (a) is
located entirely on property covered by a Site Lease or is located entirely on
the Owned Site, and (b) complies in all material respects with the terms of the
Permits pertaining to it, and (iii) Seller maintains in full force and effect
all required Permits with respect to each of the Structures for which there is a
Legal Requirement of a Permit or Permits.
3.6 PERMITS. Except as set forth in Part 3.6 of the Disclosure Schedule,
(a) the Permits constitute all material licenses, permits, registrations and
approvals necessary to operate the
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Business, (b) Seller is in material compliance with the terms of the Permits,
and (c) Seller is not in violation of any Permit, and Seller has not received
written notice that any Governmental Body issuing any Permit intends to cancel,
terminate, modify or amend any Permit.
3.7 SITE LEASES. The Site Leases listed on Schedule 2.2(d) are all of the
executed Site Leases to which Seller is a party or by which Seller or any of the
Purchased Assets are bound and Seller will deliver on or prior to Closing the
original Site Leases. The Site Leases are in full force and effect, and are
binding upon the Parties thereto. Except as set forth in Part 3.7 of the
Disclosure Schedule, (a) no default by Seller or any other Party has occurred
under the Site Leases, (b) no event, occurrence or condition exists which (with
or without notice or lapse of time or the happening of any further event or
condition) would become a default by Seller thereunder or would entitle any
other Party to terminate a Site Lease, to make a claim or set-off against Seller
or otherwise to amend such Site Lease or prevent such Site Lease from being
renewed in accordance with its terms, and (c) Seller has not received any notice
of default, termination or non-renewal under any Site Lease and none has been
Threatened.
3.8 OWNED REAL PROPERTY.
(a) Seller has good and marketable record fee title to the Owned
Real Property, such title being a fee interest in the Owned Real Property.
Seller has not received any notice of pending or Threatened claims, Proceedings,
planned public improvements, annexations, special assessments, rezonings or
other adverse claims affecting the Owned Real Property.
(b) Except as set forth in Part 3.8(b) of the Disclosure Schedule,
any buildings and related improvements located on or constituting a part of the
Owned Real Property are in good operating condition and repair, normal wear and
tear excepted. Except as set forth in Part 3.8(b) of the Disclosure Schedule,
none of the Owned Real Property is subject to special flood or mudslide hazards
or is within the 100 year flood plain. All water, sewer, gas, electric,
telephone, drainage and other utilities necessary for the current operation of
the Owned Real Property have been connected pursuant to valid permits and are
sufficient to service the Owned Real Property. All improvements constituting
part of the Owned Real Property have been completed and are now in compliance in
all material respects with all applicable Legal Requirements and Government
Authorizations. Seller has not received a notice of any pending or threatened
real estate tax deficiency or reassessment or condemnation of all or any portion
of any of the Owned Real Property. The J.G.A. Lease is in full force and effect,
is binding upon the Parties thereto, and no default by Seller or any other Party
thereto has occurred thereunder.
3.9 TITLE, ENCUMBRANCES.
(a) Except as set forth on Part 3.9(a) of the Disclosure Schedule,
Seller owns or has good title to all of the Purchased Assets, and there are no
existing agreements, options, commitments or rights with, of or to any Person to
acquire any of the Purchased Assets or any interest therein. All of the
Purchased Assets, including the Owned Real Property, are owned free and clear of
all Encumbrances except for Permitted Liens.
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(b) Except as set forth in Part 3.9(b) of the Disclosure Schedule,
none of the Structures or the Owned Real Property are or will be, subject to
zoning, use, or building code restrictions that will prohibit the continued
effective ownership, leasing or other use of such assets as currently owned and
used by Seller.
3.10 FINANCIAL STATEMENTS.
(a) Seller has delivered to Buyer the following financial
statements:
(i) the audited balance sheets of Seller for the fiscal years
ending on September 30, 1994, September 30, 1995 and September 30,
1996 (the "Base Balance Sheet") and statements of income, retained
earnings and cash flows for the three years then ended, including
the notes thereto, certified by Xxxxx & Xxxxxxx P.C., independent
public accountants; and
(ii) the unaudited balance sheets of Seller for the quarter
ending December 31, 1996 and income statements for the period then
ended, certified by Seller's chief financial officer.
The Financial Statements have been prepared using generally accepted
accounting principles consistently applied during the periods covered
thereby and are (i) complete and correct in all material respects, and
(ii) present fairly in all material respects the financial condition of
Seller at the dates of said statements and the results of Seller's
operations and cash flows for the periods covered thereby (subject in the
case of the unaudited Financial Statements to normal year-end adjustments
and the absence of footnotes). There has been no Material Adverse Change
in the financial condition of the Business or Purchased Assets since the
date of the Base Balance Sheet.
(b) As of the date hereof and as of the Closing Date, Seller had and
will have no liabilities (which liabilities, when taken individually or in
the aggregate are material) of any nature, whether accrued, absolute,
contingent or otherwise, asserted or unasserted, known or unknown
(including, without limitation, liabilities as guarantor or otherwise with
respect to obligations of others, or liabilities for taxes due or then
accrued or to become due or contingent or potential liabilities relating
to activities of Seller or the conduct of the Business of Seller prior to
the date hereof or the Closing, as the case may be, regardless of whether
claims in respect thereof had been asserted as of such date), except (i)
liabilities reflected in the Financial Statements or the notes thereto,
(ii) liabilities reflected in the Disclosure Schedule furnished to Buyer
hereunder, or (iii) liabilities incurred in the Ordinary Course of
Business since December 31, 1996.
3.11 TAXES. Seller has filed all Tax Returns that it was required to file.
All such Tax Returns were complete and accurate in all material respects. All
Taxes owed by Seller for periods, or portions of periods, ending on or before
the Closing Date have been paid. Seller is not the
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beneficiary of any current extension of time within which to file any such Tax
Returns. Except as set forth in Part 3.11 of the Disclosure Schedule, no claim
has been made by any authority that any Taxes have not been paid by Seller and
no authority is examining Seller with respect to Taxes. Seller is not subject to
taxation in any jurisdiction other than those in which Seller has filed Tax
Returns. No claim is being made by an authority in a jurisdiction where Seller
does not file Tax Returns that it is or may be subject to a taxation by that
jurisdiction. There are no security interests or liens on any of the assets of
any of Seller that arose in connection with any failure (or alleged failure) to
pay any Tax. Seller has not filed, or ever been required to file, a consolidated
federal income tax return or any combined, consolidated or unitary Tax Return.
Seller is not a party to any tax sharing agreements or similar agreements.
Seller is not liable for the Taxes of any other person. The deficiencies
assessed against Seller by the State of Florida Department of Revenue in respect
of sales and use Taxes have been resolved and paid in full. Seller will be
solely responsible for and pay any and all Taxes that may be owed by Seller up
to and through the Closing Date.
3.12 COMPLIANCE WITH LEGAL REQUIREMENTS. Seller is in material compliance
with all Legal Requirements applicable to Seller's ownership or use of the
Purchased Assets.
3.13 LEGAL PROCEEDINGS; ORDERS. Except as set forth in Part 3.13 of the
Disclosure Schedule, there is no Proceeding pending or Threatened by or against
the Seller or affecting any of the Purchased Assets, and there is no Order to
which the Seller or the Purchased Assets is subject.
3.14 OTHER CONTRACTS. The Seller is not a Party to or bound by any Other
Contract obligating the Seller for more than Two Thousand Five Hundred Dollars
($2,500), except as disclosed in Part 3.14 of the Disclosure Schedule.
3.15 INSURANCE. Seller maintains (and will through and including the
Closing Date maintain) in full force and effect policies of fire and other
casualty, liability, title and other forms of insurance covering the Purchased
Assets and the Business, and the operation thereof, of the types and with the
amounts of coverage as are consistent with industry standards for outdoor
advertising businesses comparable to the Business. A list of all insurance
policies and arrangements of Seller is set forth in Part 3.15 of the Disclosure
Schedule. Seller has not received any notice of cancellation with respect to any
such insurance.
3.16 [INTENTIONALLY OMITTED].
3.17 INTANGIBLE PROPERTY. Seller uses no Intangible Property in connection
with the operation of the Business or the Purchased Assets except for the
Permits, the Books and Records, the trade names "Tri-State Systems," and "Public
Service Displays" and licenses for commonly available software programs under
which Seller is the licensee.
3.18 RELATIONSHIPS WITH AFFILIATES. Except as set forth on Part 3.18 of
the Disclosure Schedule, Seller has not, in the three (3) years immediately
preceding the date hereof, entered into any agreement with or engaged in any
transaction with any Affiliates of (a) Seller or (b) any stockholder, officer,
director, employee or consultant of Seller for (i) the provision of any
services,
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or (ii) the purchase, sale or other transfer of any assets, other than
compensation arrangements with Seller's employees and consultants entered into
in the Ordinary Course of Business.
3.19 BROKERS OR FINDERS. Neither Seller nor any Representative of Seller
has employed or retained any broker, agent, finder or other party, or incurred
any obligation for brokerage fees, finder's fees or commissions with respect to
the transactions contemplated by this Agreement, or otherwise dealt with anyone
purporting to act in the capacity of a finder or broker with respect thereto,
other than to Brush Xxxx & Daven, LLC, whereby Seller or Buyer may be obligated
to pay a fee or a commission. Seller shall pay a fee to Brush Xxxx & Xxxxx, LLC
pursuant to a separate agreement.
3.20 EMPLOYEE BENEFIT MATTERS. Except as disclosed on Part 3.20 of the
Disclosure Schedule, with respect to the Seller:
(a) Seller does not maintain and has never maintained an "employee
benefit pension plan," within the meaning of ERISA Section 3(2), that is or was
subject to Title IV of ERISA.
(b) Seller does not have and has not ever had any past, present or
future obligation or liability to contribute to any "multiemployer plan," as
defined in ERISA Section 3(37).
For purposes of this Section 3.20, the term Seller shall be deemed to include
any other corporation, trade, business or other entity, which would together
with the Seller, now or in the past constitute a single employer within the
meaning of Section 414 of the IRC.
3.21 EMPLOYEES: LABOR MATTERS. All employees of Seller are employees at
will. Seller has made no warranty, representation or agreement, either in
writing or orally, to any employee of Seller that Purchaser intends to employ
such employee on or after the Closing Date. Seller consents to Purchaser
communicating with the employees, consultants and independent contractors of
Seller on or before the Closing Date in order to allow Purchaser make such
communications to such Persons as Purchaser reasonably deems necessary, and
Seller shall reasonably cooperate and join with Purchaser in the making of any
such communications deemed necessary by Purchaser. Seller is not a party to any
collective bargaining agreement with respect to any of its employees nor are any
employees of Seller with respect to the Business covered by any collective
bargaining agreement. A list of all employees and consultants of Seller,
including the name and rate of salary and/or other compensation and amount of
accrued vacation, compensatory and other leave time of each such Person, is set
forth on Part 3.21 of the Disclosure Schedule. No labor organization or group of
employees has made a demand for recognition, has filed a petition seeking a
representation proceeding or given Seller notice of any intention to hold an
election of a collective bargaining organization. There are no known writs,
actions, claims or legal, administrative, arbitration or other proceedings or
governmental investigations pending or Threatened involving or alleging civil
rights violations, unfair labor practice claims, back pay orders or other
similar claims or proceedings. Seller is in material compliance with all
federal, state and local laws respecting
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employment and employment practices, terms and conditions of employment and
wages and hours, and is not engaged in any unfair labor practice; there is no
unfair labor practice complaint against Seller pending before the National Labor
Relations Board; there is no labor strike, dispute, slowdown, stoppage pending
or threatened against or involving the employees of Seller; no grievance or any
arbitration proceeding is pending or threatened against Seller and no claim
therefor exists. Seller has not experienced any material labor stoppage,
concerted activity or other material labor difficulty during the last five (5)
years.
3.22 NO UNDISCLOSED LIABILITIES. Except as disclosed on Part 3.22 of the
Disclosure Schedule and except to the extent set forth in or provided for in the
Financial Statements, Seller has no liabilities, whether accrued, absolute,
contingent or otherwise, whether due or to become due and whether the amount
thereof is readily ascertainable or not, in each case insofar as pertaining to
the Business, which, individually or in the aggregate, would have a Material
Adverse Effect.
3.23 ABSENCE OF CERTAIN CHANGES. Subsequent to September 30, 1996, Seller
has not:
(a) incurred any liability or obligation with respect to the
Business under agreements or otherwise, except current liabilities entered into
or incurred in the Ordinary Course of Business consistent with past practice;
issued any notes or other debt securities or paid or discharged any outstanding
indebtedness with respect to the Business, except in the Ordinary Course of
Business consistent with past practice; or waived any of its rights with respect
to the Business;
(b) mortgaged, pledged or subjected to any Encumbrance any of the
Purchased Assets; entered into any lease of real property or buildings used in
the Business (other than Site Leases); or, except in the Ordinary Course of
Business consistent with past practice, entered into any lease of machinery or
equipment or sold or transferred any tangible or intangible asset or property
used in the Business;
(c) entered into any transaction with respect to the Business or the
Purchased Assets other than in the Ordinary Course of Business consistent with
past practice, except in connection with the execution and performance of this
Agreement and the transactions contemplated hereby; or
(d) suffered any material damage, destruction or loss to any of the
Purchased Assets (whether or not covered by insurance).
3.24 ACCOUNTS RECEIVABLE. To the knowledge of Seller, the accounts
receivable of Seller included in the Purchased Assets are fully collectible,
subject only to the allowance for doubtful accounts stated in the most recent
balance sheet included in the Financial Statements and relating to such
accounts.
3.25 CERTAIN CONTRACTS. The Advertising Contracts listed on Schedule 2(h)
are all of the executed Advertising Contracts to which Seller is a party or by
which Seller or any of the
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Purchased Assets is bound on the date hereof. Except as set forth in Part 3.25
of the Disclosure Schedule, (a) the Advertising Contracts and Other Contracts
are in full force and effect, and are binding upon the Parties thereto, (b) no
default by Seller or any other Party has occurred under the Advertising
Contracts and Other Contracts, (c) no event, occurrence or condition exists
which (with or without notice or lapse of time or the happening of any further
event or condition) would become a default by Seller thereunder or would entitle
any other Party to terminate an Advertising Contract or Other Contract, to make
a claim or set-off against Seller or otherwise to amend such Advertising
Contract or Other Contract, or prevent such Advertising Contract or Other
Contract from being renewed in accordance with its terms, and (d) Seller has not
received any notice of default, termination or non-renewal under any Advertising
Contract or Other Contract, and none has been Threatened.
3.26 WARN ACT LIABILITIES. Seller employs less than fifty (50) employees.
3.27 NON-DISCLOSURE AGREEMENTS. The Non-Disclosure Agreements are the
binding obligations of Seller, Xxxxxx and Miles, respectively, enforceable
against each of Seller, Xxxxxx and Miles in accordance with their respective
terms, except as may be limited by the laws of the State of Georgia. The
Non-Disclosure Agreements are in full force and effect and are freely assignable
by Seller without notice to or consent of Xxxxxx and/or Miles. No default by
Seller or, to the Knowledge of Seller, any other Party to the Non-Disclosure
Agreements has occurred, and, to the knowledge of Seller, no event, occurrence
or condition exists which (with or without notice or lapse of time or the
happening of any further event or condition) would become a default by Seller
thereunder or would entitle any other Party to terminate any of the
Non-Disclosure Agreements, to make a claim against Seller thereunder or to amend
such Non-Disclosure Agreements. Seller has not received any notice of default,
termination or unenforceability under either of the Non-Disclosure Agreements,
and none has been Threatened.
3.28 INDEBTEDNESS AND SECURITY INTEREST. Set forth on Part 3.28 of the
Disclosure Schedule attached hereto is a list of all Security Interests
affecting the Purchased Assets (other than Permitted Liens). There is no
indebtedness for money borrowed of the Seller other than amounts owed to Xxxxxx,
which amounts are set forth on Schedule 3.28. The indebtedness to Xxxxxx and all
such Security Interests, other than Permitted Liens, shall be satisfied and
discharged at or before the Closing.
3.29 DISCLOSURE. No representation or warranty of Seller in this Agreement
and no statement in the Disclosure Schedule contains an untrue statement of
material fact or omits to state a material fact necessary to make the statements
herein or therein, in light of the circumstances in which they were made, not
misleading.
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4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly organized,
validly existing, and in good standing under the laws of the jurisdiction of its
organization.
4.2 AUTHORITY; NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms.
Upon the execution and delivery by Buyer of the Closing Documents to which Buyer
is a party, such Closing Documents will constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms. Buyer has the absolute and unrestricted right, power, and
authority to execute and deliver this Agreement and the Closing Documents and to
perform its obligations under this Agreement and the Closing Documents to which
Buyer is a party.
(b) Neither the execution and delivery of this Agreement by Buyer
nor the consummation or performance of any of the Contemplated Transactions by
Buyer will give any Person the right to prevent, delay, or otherwise interfere
with any of the Contemplated Transactions pursuant to (i) any provision of
Buyer's Organizational Documents; (ii) any resolution adopted by the board of
directors or the stockholders of Buyer; (iii) any Legal Requirement or Order to
which Buyer may be subject; or (iv) any material Contract to which Buyer is a
party or by which Buyer may be bound. Buyer is not and will not be required to
give any notice to or obtain any Consent from any Person in connection with the
execution and delivery of this Agreement or the consummation or performance of
any of the Contemplated Transactions.
4.3 CERTAIN PROCEEDINGS. There is no pending Proceeding that has been
commenced against Buyer and that challenges, or may have the effect of
preventing, making illegal, or otherwise interfering with, any of the
Contemplated Transactions. To Buyer's Knowledge, no such Proceeding has been
Threatened in writing and no event has occurred or circumstance exist that may
give rise to or serve as a basis for the commencement of any Proceeding.
4.4 BROKERS OR FINDERS. Buyer has not incurred any obligation or
liability, contingent or otherwise, for brokerage or finders' fees or agents'
commissions or other similar payment in connection with this Agreement that will
not be paid by the Buyer.
4.5 HSR. Buyer is not a person (or included in a person) that has total
assets of $100 million or more or annual net sales of $100 million or more,
within the meaning of and as determined in accordance with the HSR Act. Buyer
has consulted with its legal counsel in determining and making such
representation.
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5. COVENANTS OF SELLER
5.1 ACCESS AND INVESTIGATION. Between the date of this Agreement and the
Closing Date, Seller will, and will cause its Representatives to, afford Buyer
and its Representatives reasonable access during normal business hours to
Seller's personnel, properties, Books and Records, and all other documents and
data relating to the Purchased Assets and the Business, and make these available
to Buyer and its Representatives. Seller and the Indemnifying Stockholders agree
to (i) permit Buyer to include financial information concerning the Purchased
Assets and the Business in any document prepared by Buyer for the purpose of
obtaining financing, and (ii) use their reasonable efforts to obtain any
necessary consents to the publication of such financial information.
5.2 OPERATION OF THE PURCHASED ASSETS. Between the date of this Agreement
and the Closing Date, Seller will:
(a) operate the Purchased Assets and Business only in the Ordinary
Course of Business consistent with the past custom and practices of the normal
day-to-day operations of the Business (including with respect to quantity and
frequency);
(b) use it Best Efforts to maintain the Purchased Assets, and
maintain good relations and good will with advertisers, landlords and others
associated with the operation of the Business;
(c) confer with Buyer concerning any Structure which involves a
proposed investment in excess of $20,000;
(d) use its Best Efforts to prevent any change with respect to its
management and supervisory personnel;
(e) use its Best Efforts to keep intact its business organization,
to keep available its present officers and employees;
(f) have in effect and maintain at all times all insurance of the
kind, in the amount and with the insurers set forth in Part 3.15 of the
Disclosure Schedule hereto or equivalent insurance with any substitute insurers
approved in writing by Buyer;
(g) furnish Buyer with unaudited monthly balance sheets and
statements of income and retained earnings and cash flows of Seller within
fifteen (15) days after each month end for each month ending more than fifteen
(15) days before the Closing;
(h) make no purchase, sale or lease in respect of the Business or
any of the Purchased Assets, except in a manner consistent with prior practice,
including, without limitation, the payment of sales and leasing commissions;
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(i) maintain its Books and Records in accordance with good business
practices, on a basis consistent with prior practice;
(j) xxxx for services rendered and pay accounts payable in
connection with the Business, on a regular and timely basis consistent with past
practice;
(k) comply in all material respects with all Legal Requirements
applicable to it and to the conduct of the Business and perform all of its
obligations (including obligations imposed under this Agreement) without
default, consistent with past practice;
(l) not make any loans or advances of any of the Purchased Assets,
directly or indirectly, to any Person, nor further mortgage, pledge or subject
to Encumbrance any of the Purchased Assets;
(m) not make any change in the terms of any contract, license,
lease, mortgage or any other agreement to which it is a party, except in the
Ordinary Course of Business, consistent with past practice; and
(n) not waive, cancel, sell or otherwise dispose of for less than
the face value thereof any claim or right included in the Purchased Assets that
it has against others, except in the Ordinary Course of Business consistent with
past practice.
5.3 BEST EFFORTS. Between the date of this Agreement and the Closing Date,
Seller will use its Best Efforts to cause the conditions in Section 7 to be
satisfied.
5.4 REQUIRED APPROVALS AND CONSENTS. As promptly as practicable after the
date of this Agreement, Seller will make all filings required by Legal
Requirements and other third parties to be made by it in order to consummate the
Contemplated Transactions and will use Best Efforts to obtain the Consents
identified in Section 3.2 for the transfer of the Purchased Assets.
5.5 NOTIFICATION. Between the date of this Agreement and the Closing Date,
Seller will promptly notify Buyer in writing if Seller becomes aware of any fact
or condition that causes or constitutes a breach of any of Seller's
representations and warranties as of the date of this Agreement, or if Seller
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. Seller shall use its Best Efforts to remedy any such
breach. During the same period, Seller will promptly notify Buyer of the
occurrence of any breach of any covenant of Seller in this Section 5 or of the
occurrence of any event that may make the satisfaction of the conditions in
Section 7 impossible or unlikely.
5.6 NO NEGOTIATION. Until the earlier of the Closing or such time, if any,
as this Agreement is terminated pursuant to Section 9, neither Seller nor any
Affiliate will, nor will they
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permit their respective Representatives to, directly or indirectly solicit,
initiate, or encourage any inquiries or proposals from, discuss or negotiate
with, provide any non-public information to, or consider the merits of any
inquiries or proposals from, or make any offers or proposals to, any Person
(other than Buyer or its Representatives) relating to or affecting any
transaction involving the sale of the Purchased Assets.
5.7 COOPERATION; BOOKS AND RECORDS. Seller and the Indemnifying
Stockholders shall cooperate with all reasonable requests of Buyer and Buyer's
Representatives in connection with the consummation of the transactions
contemplated hereby. Seller shall maintain its Books and Records in accordance
with good business practices, on a basis consistent with past practices.
5.8 TAX CLEARANCE. If requested by Buyer, Seller shall promptly file with
the applicable taxing authorities of the States of Georgia, Florida, Alabama,
South Carolina, Tennessee, Kentucky and Mississippi, in accordance with the
respective tax laws of such states, any notification required with respect to
the Contemplated Transactions. Seller represents and warrants to Buyer that the
Business is not doing business in any jurisdiction other than States of Georgia,
Florida, Alabama, South Carolina, Tennessee, Kentucky, and Mississippi. In the
event that either Seller or Buyer shall receive either before or after the
Closing from any such authority notice that the applicable state has a possible
claim against Seller for any Taxes relating to the Purchased Assets or the
Business, but not including any sales, transfer or similar tax (other than the
transfer taxes in connection with the conveyance of the Owned Real Property) in
connection with the consummation of the Contemplated Transactions (which, if
any, shall be paid for by Buyer), Seller shall promptly satisfy such claim (it
being agreed and understood that notwithstanding the foregoing, tax clearances
shall not be a condition to the Closing.)
6. COVENANTS OF BUYER
6.1 REQUIRED APPROVALS. As promptly as practicable after the date of this
Agreement, Buyer will make all filings required by Legal Requirements to be made
by it to consummate the Contemplated Transactions.
6.2 BEST EFFORTS. Between the date of this Agreement and the Closing Date,
Buyer will use its Best Efforts to cause the conditions in Section 8 to be
satisfied; provided that this Agreement will not require Buyer to dispose of or
make any change in any portion of its business or to incur any other burden to
obtain a Governmental Authorization.
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6.3 NOTIFICATION. Between the date of this Agreement and the Closing Date,
Buyer will promptly notify Seller in writing if Buyer becomes aware of any fact
or condition that causes or constitutes a breach of any of Buyer's
representations and warranties as of the date of this Agreement, or if Buyer
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Buyer will promptly notify
Seller of the occurrence of any breach of any covenant of Buyer in this Section
6 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 8 impossible or unlikely.
6.4 COBRA CONTINUATION COVERAGE. Buyer shall offer or make available
"continuation coverage," within the meaning of Section 4980B(f)(2) of the Code
from and after the Closing to former employees of the Seller who terminate
employment on or prior to the Closing in satisfaction of Seller's obligations to
make such coverage available, without regard to the termination of the Seller's
group health plan. The assumption of this obligation by Buyer does not, and
shall not be construed as creating, an employer-employee relationship between
Buyer and any former employee of Seller who is provided such coverage.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Purchased Assets and to take the other
actions required to be taken by Buyer at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Buyer, in writing, in whole or in part):
7.1 ACCURACY OF REPRESENTATIONS. Seller's representations and warranties
in this Agreement must have been accurate in all material respects as of the
date of this Agreement, and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date, and Buyer shall have received a
certificate of an executive officer of Seller, dated as of the Closing Date, as
to such accuracy.
7.2 SELLER'S PERFORMANCE. The covenants and obligations that Seller is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Buyer shall have received a certificate of an executive officer of Seller,
dated as of the Closing Date, as to such compliance.
7.3 CONSENTS. Each of the Consents required pursuant to Section 5.4, the
failure of which to obtain will or may have, separately or in the aggregate, a
Material Adverse Effect, must have been obtained and must be in full force and
effect.
7.4 ADDITIONAL DOCUMENTS. Each of the following documents must have been
delivered to Buyer:
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(a) an opinion of Powell, Goldstein, Xxxxxx & Xxxxxx LLP dated the
Closing Date, in the form and substance reasonably satisfactory to Buyer;
(b) the deliveries required from Seller in Section 2.8; and
(c) such other documents as Buyer may reasonably request for the
purpose of (i) evidencing the satisfaction of any condition referred to in this
Section 7, or (ii) otherwise facilitating the consummation or performance of any
of the Contemplated Transactions.
7.5 NO PROCEEDINGS. Since the date of this Agreement, there must not have
been commenced and pending or Threatened any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, (ii) that prevents, makes illegal, or otherwise
materially interferes with any of the Contemplated Transactions or seeks to do
any of the foregoing, or (iii) that involves any material claim against Seller.
7.6 NO PROHIBITION. There must not be in effect any Legal Requirement or
any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions, including, without limitation, HSR Act
compliance.
7.7 NO MATERIAL ADVERSE CHANGE. There shall not have been a Material
Adverse Change in the Purchased Assets or the Business since the date hereof.
7.8 SATISFACTION OF INDEBTEDNESS. At or prior to the Closing, Seller shall
have repaid in full all outstanding indebtedness of Seller to Xxxxxx and shall
cause all Security Interests affecting the Purchased Assets (including, without
limitations those securing the indebtedness to Xxxxxx) other than Permitted
Liens to be extinguished.
7.9 NON-SOLICITATION AGREEMENTS. The Non-Solicitation Agreements shall
have been assigned to Buyer and each of Xxxxxx X. Xxxxxx and Xxxx X. Xxxxx shall
have executed and delivered to Buyer an affirmation of the same in the form of
Exhibit D.
7.10 BILLBOARD INCOME. The gross billboard lease income of the Business
for the calendar month preceding the Closing must be $490,000 or more.
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE
Seller's obligation to sell the Purchased Assets and Seller's obligations
to take the other actions required to be taken by Seller at the Closing is
subject to the satisfaction, at or prior to the Closing, of each of the
following conditions (any of which may be waived by Seller in writing, in whole
or in part):
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8.1 ACCURACY OF REPRESENTATIONS. Buyer's representations and warranties in
this Agreement must have been accurate in all material respects as of the date
of this Agreement and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date, and Seller shall have received a
certificate of an executive officer of Buyer, dated as of the Closing Date, as
to such accuracy.
8.2 BUYER'S PERFORMANCE. The covenants and obligations that Buyer is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Seller shall have received a certificate of an executive officer of Buyer,
dated as of the Closing Date, as to such compliance.
8.3 ADDITIONAL DOCUMENTS. Buyer must have caused the following documents
to be delivered to Seller:
(a) an opinion of St. Xxxx & Xxxxx, L.L.C., dated the Closing Date,
in the form and substance reasonably satisfactory to Seller;
(b) the deliveries required from Buyer in Section 2.8; and
(c) such other documents as Seller may reasonably request for the
purpose of (i) evidencing the satisfaction of any condition referred to in this
Section 8, or (ii) otherwise facilitating the consummation of any of the
Contemplated Transactions.
8.4 NO PROCEEDINGS. Since the date of this Agreement, there must not have
been commenced and pending or Threatened any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, or (ii) that prevents, makes illegal, or otherwise
materially interferes with any of the Contemplated Transactions or seeks to do
any of the foregoing.
8.5 NO PROHIBITION. There must not be in effect any Legal Requirement or
any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions, including, without limitation, HSR Act
compliance.
9. TERMINATION
9.1 TERMINATION EVENTS. This Agreement may, by written notice given prior
to or at the Closing, be terminated:
(a) by mutual consent of Buyer and Seller;
(b) (i) by Buyer if any of the conditions in Section 7 has not been
satisfied as of the Closing Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of Buyer to comply with its
obligations under this Agreement), Buyer has not waived in
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writing such condition on or before the Closing Date, and Buyer is not in breach
of any of the provisions of this Agreement; or (ii) by Seller, if any of the
conditions in Section 8 has not been satisfied as of the Closing Date or if
satisfaction of such a condition is or becomes impossible (other than through
the failure of Seller to comply with its obligations under this Agreement),
Seller has not waived in writing such condition on or before the Closing Date,
and Seller is not in breach of any of the provisions of this Agreement; or
(c) by Buyer, on the one hand, or Seller, on the other hand, if the
Closing has not occurred (other than through the failure of the Party seeking to
terminate this Agreement to comply fully with its obligations under this
Agreement) on or before June 12, 1997.
9.2 EFFECT OF TERMINATION. Each Party's right of termination under Section
9.1 is in addition to any other rights it may have under this Agreement. If this
Agreement is terminated pursuant to Section 9.1, all further obligations of the
Parties under this Agreement will terminate, except that the obligations in
Section 11.1 will survive; provided, however:
(a) If Buyer shall default in its obligations under this Agreement
to consummate the Contemplated Transactions (other than as a result of Seller's
default under this Agreement), and Buyer shall fail to cure such default within
seven (7) days after receipt of written notice of default from Seller, then
Seller shall have the right to pursue any or all legal and equitable remedies,
separately or simultaneously (including specific performance) which will survive
the termination unimpaired; provided, that damages shall include, but not be
limited to: (i) the difference between $31 million and the lesser amount
received by Seller or Stockholders in any subsequent sale of all of the assets
or stock of Seller, and (ii) all fees, costs and expenses incurred by Seller or
Stockholders in connection with any such sale, which sale shall not be necessary
to prove damages (provided further, that any such sale must be arm's-length with
a bona fide purchaser).
(b) If Seller shall default in its obligations under this Agreement
to consummate the Contemplated Transactions (other than as a result of Buyer's
default under this Agreement), and Seller shall fail to cure such default within
seven (7) days after receipt of written notice of default from Buyer, then Buyer
shall have the right to pursue any or all legal and equitable remedies,
separately or simultaneously (including specific performance), which will
survive the termination unimpaired.
(c) The remedies set forth in this Section 9.2 apply only to the
failure of a Party to consummate the Contemplated Transactions, and not with
respect to any obligations specified herein that survive the Closing or
termination of this Agreement.
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10. INDEMNIFICATION; REMEDIES
10.1 INDEMNIFICATION AND PAYMENT OF DAMAGES BY THE INDEMNIFYING
STOCKHOLDERS. After the Closing, the Indemnifying Stockholders, severally and on
a pro rata basis in proportion to the percentages set forth in Exhibit E, will
indemnify and hold harmless Buyer, its stockholders, employees, controlling
Persons, and Affiliates (collectively, the "Seller Indemnified Persons") for,
and will pay to the Seller Indemnified Persons the amount of, any loss,
liability, claim, damage, expense (including reasonable costs of investigation,
defense and settlement and reasonable attorneys' fees), whether or not involving
a third-party claim (collectively, "Damages"), arising, directly or indirectly,
from or in connection with:
(a) any breach of any representation or warranty made by Seller in
this Agreement, the Disclosure Schedule, or any other certificate, schedule,
exhibit or document delivered by Seller pursuant to this Agreement;
(b) any breach by Seller of any covenant or obligation of Seller in
this Agreement or any certificate or document delivered by Seller pursuant to
this Agreement; and
(c) the failure of Seller and/or the Indemnifying Stockholders to
satisfy and discharge any Excluded Liabilities.
10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will indemnify
and hold harmless Seller, its stockholders, controlling Persons and Affiliates
(collectively, the "Buyer Indemnified Persons") for, and will pay to the Buyer
Indemnified Persons the amount of any Damages arising, directly or indirectly,
from or in connection with:
(a) any breach of any representation or warranty made by Buyer in
this Agreement or in any certificate or document delivered by Buyer pursuant to
this Agreement;
(b) any breach by Buyer of any covenant or obligation of Buyer in
this Agreement including, without limitation, any failure to pay Assumed
Liabilities after the Closing; and
(c) any liability arising from Buyer's operation of the Purchased
Assets.
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10.3 PROCEDURE FOR INDEMNIFICATION -- THIRD PARTY CLAIMS.
(a) Promptly after receipt by an Indemnified Person under Section
10.1 or 10.2, of notice of any claim against it, such Indemnified Person will,
if a claim is to be made against an Indemnifying Party under such Section, give
written notice to the Indemnifying Party of the commencement of such claim, but
the failure to notify the Indemnifying Party will not relieve the Indemnifying
Party of any liability that it may have to any Indemnified Person, except to the
extent that the Indemnifying Party demonstrates that the defense of such action
is prejudiced by the Indemnified Party's failure to give such notice.
(b) If any claim referred to in Sections 10.1 or 10.2 is brought
against an Indemnified Person and it gives written notice to the Indemnifying
Party of such claim, the Indemnifying Party may, at its option, assume the
defense of such claim with counsel satisfactory to the Indemnified Person and,
after written notice from the Indemnifying Party to the Indemnified Person of
its election to assume the defense of such claim, the Indemnifying Party will
not, as long as it diligently conducts such defense, be liable to the
Indemnified Person under this Article 10 for any fees of other counsel or any
other expenses with respect to the defense of such claim, subsequently incurred
by the Indemnified Person in connection with the defense of such claim, other
than reasonable costs of investigation. If the Indemnifying Party assumes the
defense of a claim, (i) no compromise or settlement of such claims may be
effected by the Indemnifying Party without the Indemnified Person's consent
unless (A) there is no finding or admission of any violation of Legal
Requirements or any violation of the rights of any Person, and (B) the sole
relief provided is monetary damages that are paid in full by the Indemnifying
Party; and (ii) the Indemnified Person will have no liability with respect to
any compromise or settlement of such claims effected without its consent.
Subject to Section 10.3(c), if notice is given to an Indemnifying Party of any
claim and the Indemnifying Party does not, within twenty days after the
Indemnified Person's notice is given, give notice to the Indemnified Person of
its election to assume the defense of such claim, the Indemnifying Party will be
bound by any determination made in such Proceeding or any compromise or
settlement effected by the Indemnified Person.
(c) Notwithstanding the foregoing, if an Indemnified Person
determines in good faith that there is a reasonable probability that a claim may
adversely affect it or its affiliates other than as a result of monetary damages
for which it would be entitled to indemnification under this Agreement, the
Indemnified Person may, by notice to the Indemnifying Party, assume the
exclusive right to defend, compromise, or settle such claim, but the
Indemnifying Party will not be bound by any determination of a claim so defended
or any compromise or settlement effected without its consent (which may not be
unreasonably withheld).
10.4 PROCEDURE FOR INDEMNIFICATION -- OTHER CLAIMS. A claim for
indemnification for any matter not involving a third-party claim shall be
asserted by written notice to the Indemnifying Party from whom indemnification
is sought.
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10.5 SURVIVAL/LIMITATIONS.
(a) The Parties hereto agree that (i) the covenants and agreements
contained in the Agreement (including, without limitation, Section 10.1(c)) and
any document delivered pursuant hereto and the representations and warranties
contained in Sections 3.1, 3.2(a), 3.3, 3.8(a), 3.9(a), 3.11, 3.12, 3.13, 3.19,
3.20, 3.21, 3.29, 4.1, 4.2(a) and 4.4 shall survive until ninety (90) days after
the expiration of all applicable statutes of limitation with respect to the
subject matter thereof, (ii) all other representations and warranties shall
survive until eighteen (18) months following the Closing Date, and (iii) any
indemnification claim for a breach of the foregoing must be made in writing in
accordance with the provision of this Article 10 within the applicable survival
period for the underlying representation, warranty or covenant. The expiration
of the applicable survival period will not extinguish an indemnification claim
properly made prior to such expiration in accordance with this Article 10.
(b) The Indemnifying Stockholders shall not be required to make any
payments to the Seller Indemnified Persons (i) pursuant to Section 10.1(a) or
Section 10.1(b) until the Damages, in the aggregate, exceed Five Hundred
Thousand Dollars ($500,000) and then only to the extent of Damages in excess of
such amount, and in no event shall the Indemnifying Stockholders' obligation to
indemnify the Seller Indemnified Persons for Damages pursuant to such sections
collectively exceed One Million Six Hundred Thousand Dollars ($1,600,000). The
Indemnifying Stockholders shall not be required to make any payments to the
Seller Indemnified Persons pursuant to Section 10.1(c) to the extent Damages, in
the aggregate, exceed the amount of the Purchase Price less the amount of all
Excluded Liabilities paid to third parties to the date of such claim.
(c) Notwithstanding the foregoing, any claims for Damages arising
from fraud by Seller or the Indemnifying Stockholders hereunder shall be without
limitation of any kind.
(d) Buyer's sole and exclusive remedy after the Closing has occurred
for any breach of this Agreement or for Damages shall be under this Section 10.
11. GENERAL PROVISIONS
11.1 EXPENSES. Except as otherwise expressly provided in this Agreement,
each Party to this Agreement will bear its respective expenses incurred in
connection with the preparation, execution, and performance of this Agreement
and the Contemplated Transactions, including all fees and expenses of agents,
representatives, brokers or finders, counsel, and accountants. In the event of
termination of this Agreement, the obligation of each Party to pay its own
expenses will be subject to any rights of such Party arising from a breach of
this Agreement by another Party.
11.2 PUBLIC ANNOUNCEMENTS; CONFIDENTIALITY. Any public announcement or
similar publicity with respect to this Agreement or the Contemplated
Transactions will be issued, if at all,
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at such time and in such manner as Buyer and Seller agree in writing, provided
that the Parties shall reasonably cooperate in such announcements, and provided
further that nothing contained herein shall prevent any Party from at any time
furnishing information required by a Governmental Body. Unless consented to by
Buyer and Seller in advance or required by Legal Requirements, prior to the
Closing, each Party shall, and shall cause their respective Representatives to,
keep this Agreement strictly confidential and may not make any disclosure of
this Agreement to any Person, except that Buyer may disclose this Agreement to
financing sources.
11.3 [INTENTIONALLY OMITTED].
11.4 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by telecopier (with written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and telecopier
numbers set forth below (or to such other addresses and telecopier numbers as a
Party may designate by notice to the other Parties):
If to Seller, to:
Tri-State Systems, Inc.
X.X. Xxx 0000
Xxxxxxx 00 Xxxxx
Xxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
President
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
Powell, Goldstein, Xxxxxx & Xxxxxx LLP
Sixteenth Floor
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
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If to Buyer, to:
Tri-State Outdoor Media Group, Inc.
0000 Xxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
President
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
St. Xxxx & Xxxxx, L.L.C.
0 Xxxx Xxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
11.5 FURTHER ASSURANCES. The Parties agree (a) to furnish upon request to
each other such further information, (b) to execute and deliver to each other
such other documents, and (c) to do such other acts and things, all as the other
Party may reasonably request for the purpose of carrying out the intent of this
Agreement and the documents referred to in this Agreement, all at the sole cost
and expense of the requesting Party (unless the requesting Party is entitled to
indemnification therefor under Section 10).
11.6 WAIVER. Neither the failure nor any delay by any Party in exercising
any right, power, or privilege under this Agreement or the documents referred to
in this Agreement will operate as a waiver of such right, power, or privilege,
and no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege.
11.7 ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes all
prior agreements between the Parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement between the Parties with
respect to its subject matter. This Agreement may not be amended, nor may
compliance with any condition set forth herein be waived, except by a written
agreement executed by each Party hereto, or in the case of a waiver, the Party
waiving compliance.
11.8 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. Prior to the
Closing, Buyer's rights and obligations under this Agreement shall be assignable
by Buyer to a corporation or partnership or other legal entity controlling,
controlled by or under common control with Buyer upon written notice to Seller.
After the Closing, Buyer's rights and obligations hereunder shall be freely
assignable. This Agreement may not be assigned by Seller without the prior
written consent of Buyer. No assignment to or assumption by any assignee,
however made, will release the assigning Parties from their respective duties
and obligations under this Agreement. This
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Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the Parties, their successors, and their permitted assigns. Nothing
expressed or referred to in this Agreement will be construed to give any Person
other than the Parties to this Agreement any legal or equitable right, remedy,
or claim under or with respect to this Agreement or any provision of this
Agreement.
11.9 ACCOUNTS RECEIVABLE. Seller agrees to forward to Buyer any payments
that Buyer may receive with respect to any accounts receivable included in the
Purchased Assets.
11.10 SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
11.11 RISK OF LOSS. Material risk of loss or damage to the Purchased
Assets from any casualty prior to the Closing shall be borne by Seller, and
after the Closing shall be borne by Buyer.
11.12 POST-CLOSING ACCESS. Buyer agrees that all Books and Records
delivered to Buyer by Seller pursuant to this Agreement shall be maintained open
for inspection by Seller at any time during regular business hours upon
reasonable notice for a period of six (6) years (or for such longer period as
may be required by applicable Legal Requirements) following the Closing and
that, during such period, Seller, at its expense, may make such copies thereof
as it may reasonably desire. Seller agrees that all books and records relating
to the Purchased Assets and retained by Seller shall be maintained open for
inspection by Buyer at any time during regular business hours for a period of
six (6) years (or for such longer period as may be required by applicable Legal
Requirements) following the Closing and that, during such period, Buyer, at its
expense, may make such copies thereof as it may reasonably desire. Nothing
contained in this Section 11.12 shall obligate any Party hereto to make
available any books and records if to do so would violate the terms of any
Contract or Legal Requirement to which it is a Party or to which it or its
assets are subject.
11.13 HEADINGS; CONSTRUCTION. The headings of Sections in this Agreement
are provided for convenience only and will not affect its construction or
interpretation. All words used in this Agreement will be construed to be of such
gender or number as the circumstances require. Unless otherwise expressly
provided, the word "including" does not limit the preceding words or terms.
11.14 APPLICABLE LAW. This Agreement shall be governed and controlled as
to validity, enforcement, interpretations, construction, effect and in all other
respects by the internal laws of the State of Georgia applicable to contracts
made in that State excepting specifically for any matters pertaining to real
estate located in or permits issued by a Governmental Body in States other than
Georgia and all such matters shall be governed and controlled by the laws of the
applicable State.
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11.15 INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits and Schedules
identified in this Agreement are incorporated herein by reference and made a
part hereof.
11.16 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
11.17 JURISDICTION AND CONSENT TO SERVICE. Each of Seller, Buyer and the
Indemnifying Stockholders (a) consent to the jurisdiction of any state or
federal court of Georgia in any suit, action or proceeding relating to or
arising out of this Agreement; (b) waive any objection which they may have to
the laying of venue in any such suit, action or proceeding in any such court,
and (c) agree that service of any court paper may be provided under applicable
laws or court rules governing service of process in such court.
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IN WITNESS WHEREOF, the Parties have executed, sealed and delivered this
Agreement as of the date first written above.
BUYER:
TRI-STATE OUTDOOR MEDIA GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
______________________________________
Xxxxxxx X. Xxxxx
President
SELLER:
TRI-STATE SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
______________________________________
Xxxxxxx X. Xxxxxxx
Vice President
[Signatures continued on next page]
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00
XXXXXXXXXXXX XXXXXXXXXXXX:
/s/ DCD
_________________________________________
Xxxxxx X. Xxxxxx
/s/ Xxxxxx X. Xxxxxx
_________________________________________
Xxxxxx X. Xxxxxx, Xx.
Buckhead Investment Group:
By:______________________________________
Title:___________________________________
Xxxxxx X. Xxxxxx Individual Retirement Account
By: /s/ DCD
_________________________________________
Lincoln Trust Company
Custodian
Xxxxxxx & Xxxxx, P.C. Profit Sharing Plan
By: /s/ Xxxxxxx X. Xxxxxxx
_________________________________________
Xxxxxxx X. Xxxxxxx, Xx., Trustee
/s/ Xxxxxx Xxxxx
_________________________________________
Xxxxxx X. Xxxxx
/s/ Xxxxxxx X. XxXxxxxx
_________________________________________
Xxxxxxx X. XxXxxxxx
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/s/ Xxxx X. Xxxxx
_________________________________________
Xxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxxxx
_________________________________________
Xxxxxxx X. Xxxxxxx, Xx.
SouthTrust Asset Management Co. of Ga., NA,
Trustee for Xxxxxx X. Xxxxxx, Xx., XXX
/s/ Xxxxxx X. Xxxxxx
By:______________________________________
Title:___________________________________
SouthTrust Asset Management Co. of Ga., NA,
Custodian FBO Xxxxxx X. Xxxxxx, Xx., XXX
/s/ Xxxxxx X. Xxxxxx
By:______________________________________
Title:___________________________________
SouthTrust Asset Management Co. of Ga., NA,
Trustee for Xxxxxx X. Xxxxxx, Xx., P/U
Invesco Money Purchase Pension Plan
/s/ Xxxxxx X. Xxxxxx
By:______________________________________
Title:___________________________________
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EXHIBIT A
DEFINITIONS
"ADVERTISING CONTRACTS" -- as defined in Section 2.2(h).
"AFFILIATES" -- when used with reference to a specified Person, any other
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with the specified Person and any
spouse or immediate family member of such Person. For purposes of this
definition of Affiliate, "control" means the possession, directly or indirectly,
of the power to direct or to cause the direction of management and policies of
the Person in question, whether through the ownership of voting securities or by
contract or otherwise.
"ASSIGNMENT OF CONTRACTS" -- the Assignment and Assumption of Advertising
Contracts in the form of Exhibit B attached hereto.
"ASSUMED LIABILITIES" -- as defined in Section 2.4.
"ASSUMED OTHER CONTRACTS" -- all Other Contracts except any evidencing
Seller's indebtedness to Xxxxxx.
"ASSUMED SALES COMMISSIONS" -- sales and leasing commissions due and
payable to employees of Seller within thirty (30) days after the Closing Date up
to $26,477 in the aggregate and any sales and leasing commissions which become
due and payable to employees of Seller thereafter with respect to Advertising
Contracts or Site Leases transferred hereunder.
"BASE BALANCE SHEET" -- the balance sheet of Seller as of September 30,
1996 described in Section 3.10(a)(i).
"BEST EFFORTS" -- the efforts that a prudent Person desirous of achieving
a result would use in similar circumstances.
"XXXX OF SALE" -- the Xxxx of Sale, Assignment and Assumption Agreement in
the form of Exhibit C attached hereto.
"BOOKS AND RECORDS" -- All copies of Seller's books and records relating
to the Purchased Assets, including, without limitation, Site Lease files, Permit
files, maintenance and other records relating to the Structures, logs,
advertiser, customer and supplier lists, computer files and databases.
"BUYER" -- as defined in the first paragraph of this Agreement.
"CLOSING" -- as defined in Section 2.6.
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"CLOSING DATE" -- as defined in Section 2.6.
"CLOSING DOCUMENTS" -- any documents to be executed at Closing pursuant to
this Agreement.
"COBRA CONTINUATION COVERAGE" -- that coverage described in Section 6.4
hereof.
"CODE" -- the Internal Revenue Code of 1986, as amended.
"CONFIDENTIAL INFORMATION" -- any information concerning the Businesses,
the Purchased Assets and the affairs of Seller that is not generally available
to the public.
"CONSENT" -- any approval, consent, ratification, waiver, or other
authorization (including any Governmental Authorization).
"CONTEMPLATED TRANSACTIONS" -- all of the transactions contemplated by
this Agreement, including: (a) the purchase of the Purchased Assets by Buyer
from Seller and assignment to and assumption by Buyer of the Assumed
Liabilities, and (b) the performance by Buyer and the Seller of their respective
covenants and obligations under this Agreement.
"CONTRACT" -- any agreement, contract, obligation, promise, or undertaking
(whether written or oral and whether express or implied) that is legally
binding.
"COURTESY LEASES" -- those certain leases between Seller and Courtesy
Leasing dated August 26, 1994 (Nos. 4574, 4575, 4576, 4577 and 4578) and June 7,
1996 (Nos. 4814 and 4815).
"COURTESY LEASING" -- Courtesy Leasing, Inc., an Alabama corporation.
"CURRENT PROCEEDINGS" -- proceedings listed on Part 3.13 of the Disclosure
Schedule.
"DAMAGES" -- as defined in Section 10.1.
"DECEMBER BALANCE SHEET" -- the balance sheet of Seller as of December 31,
1996 described in Section 3.10(a)(ii).
"DEEDS" -- limited warranty deeds (or the statutory equivalent thereof
with covenants against grantor's acts only), in recordable form, with respect to
the Owned Real Property.
"DISCLOSURE SCHEDULE" -- the disclosure schedule, delivered by Seller to
Buyer concurrently with the execution and delivery of this Agreement.
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"ENCUMBRANCE" -- any charge, claim, condition, equitable interest, lien,
option, pledge, security interest, right of first refusal, or restriction of any
kind, including any restriction on use, transfer, receipt of income, or exercise
of any other attribute of ownership.
"ENVIRONMENT" -- soil, land surface or subsurface strata, surface waters,
groundwaters, drinking water supply, stream sediments, ambient air (including
indoor air), plant and animal life, and any other environmental medium or
natural resource.
"ENVIRONMENTAL LAW" -- any Legal Requirement pertaining to environmental
discharges, Release, emissions or spills or the manufacture, sale, processing,
handling, transportation, storage or disposal of any Hazardous Materials, or
relating to any environmental processes or condition, including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act ("CERCLA"), the Clean Air Act, the Clean Water Act, the Resource
Conservation and Recovery Act ("RCRA"), the Endangered Species Act, the Federal
Insecticide, Fungicide and Rodenticide Act, the Hazardous Materials
Transportation Act, the Surface Mining Control and Reclamation Act, the
Emergency Planning and Community Right to Know Act, the Safe Drinking Water Act,
the Toxic Substances Control Act, the Coastal Zone Management Act, the National
Environmental Policy Act, the Noise Control Act. As used in this Agreement,
Environmental Laws shall mean any of such laws or regulations as the same exist
now or at the Closing Date.
"ERISA" -- the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to that Act or any
successor law.
"EXCLUDED BALANCE SHEET LIABILITIES" -- shall mean payroll and Income
Taxes, indebtedness to Xxxxxx, vacation and sick pay, audit fees, director's
fees, health insurance claims and premiums, and liabilities under the Courtesy
Leases to the extent accrued and payable prior to Closing.
"EXCLUDED LIABILITIES" -- as defined in Section 2.5.
"EXCLUDED SALES COMMISSIONS" -- sales and leasing commissions due and
payable to employees of Seller within thirty (30) days after the Closing in
excess of $26,477 in the aggregate.
"EXCLUDED TRADE PAYABLES" -- all trade payables of the Seller (not
including those items listed on Schedule A.1) as of the Closing Date that (i)
are more than forty-five (45) days past the invoice date, or (ii) are forty-five
(45) days or less past the invoice date but that exceed $60,000 in the
aggregate.
"FINANCIAL STATEMENTS" -- those financial statements of Seller described
in Sections 3.10(a)(i) and (ii).
"GOVERNMENTAL AUTHORIZATION" -- any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise made
available by or under the authority of any Governmental Body or pursuant to any
Legal Requirement.
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"GOVERNMENTAL BODY" -- any federal, state, local, municipal, foreign, or
other government; or governmental or quasi-governmental authority of any nature
(including any governmental agency, branch, department, official, or entity and
any court or other tribunal).
"HAZARDOUS MATERIALS" -- any waste or other substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, and specifically including petroleum and all derivatives
thereof or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
"XXXXXX" -- Xxxxxx Financial, Inc.
"HSR ACT" -- the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, and any regulations and rules promulgated thereunder.
"INCOME TAX" -- any federal, state, local, or foreign income tax or
capital gains tax, including any interest, penalty, or addition thereto, whether
disputed or not.
"INCOME TAX RETURN" -- any return, declaration, report, claim for refund,
or information return or statement relating to Income Taxes, including any
schedule or attachment thereto.
"INDEMNIFIED PERSON" -- any of the Seller Indemnified Persons or the Buyer
Indemnified Persons, as the context requires.
"INDEMNIFYING PARTY" -- the Buyer or the Seller, as the context requires.
"INDEMNIFYING STOCKHOLDERS" -- the partners of Tri-State Partners (other
than American Cancer Society, Georgia Institute of Technology Foundation, Holy
Spirit Church, Xxxxxxx X. Xxxxxxx Charitable Remainder Unitrust and Xxxxxx X.
Xxxxxx Charitable Remainder Unitrust) and the Stockholders (other than
Chattahoochee Leasing Corporation, Xxxxxxxx X. Xxxxxxx, X. Xxxxxx Xxxxx III,
Xxxxxxxx X. Xxxxxx, Buckhead Investment Group and Tri-State Partners).
"INTANGIBLE PROPERTY" -- All right, title and interest in and to the
goodwill and other intangible property (including Seller's trade names and trade
logos but excluding Seller's corporate name) used in connection with the
Purchased Assets, all licenses, permits and authorizations pertaining to the
Purchased Assets or the right to own and operate the Purchased Assets and all
right, title and interest in and to (i) any intellectual property used in
connection with the Purchased Assets, and (ii) all records and data relating to
the Purchased Assets.
"IRC" -- the Internal Revenue Code of 1986, as amended from time to time,
or any successor law, and regulations issued by the IRS pursuant to the Internal
Revenue Code or any successor law.
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"IRS" -- the United States Internal Revenue Service and, to the extent
relevant, the United States Department of the Treasury.
"J.G.A. LEASE" -- that certain Lease dated January 15, 1996 between Seller
and J.G.A. Corp.
"KNOWLEDGE" -- a Person will be deemed to have "Knowledge" of a particular
fact or other matter only if such Person is actually aware of such fact or other
matter without making any independent inquiry or investigation. A Person (other
than an individual) will be deemed to have "Knowledge" of a particular fact or
other matter if any individual who is serving as a director, officer, partner,
executor, or trustee of such Person (or in any similar capacity) has Knowledge
of such fact or other matter.
"LEGAL REQUIREMENT" -- any federal, state, local, municipal, foreign,
international, multinational, or other administrative Order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.
"MATERIAL ADVERSE CHANGE" -- a change that, more likely than not, will
cause a Material Adverse Effect.
"MATERIAL ADVERSE EFFECT" -- a material adverse effect on the Purchased
Assets or the business prospects, operations or conditions (financial or
otherwise) relating thereto, taken as a whole.
"NON-SOLICITATION AGREEMENT" -- those Non-Disclosure and Non-Solicitation
Agreements dated July 1, 1993 of the Seller with each of Xxxxxx X. Xxxxxx and
Xxxx X. Xxxxx.
"ORDER" -- any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any court,
administrative agency, or other Governmental Body or by any arbitrator.
"ORDINARY COURSE OF BUSINESS" -- a matter will be deemed in the "Ordinary
Course of Business" if it is a matter that is reasonably related to the
operation of the Business and is consistent with the custom and practices of
similarly situated businesses in the outdoor advertising industry.
"ORGANIZATIONAL DOCUMENTS" -- (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the partnership agreement and
any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) any charter or similar document adopted or filed in connection
with the creation, formation, or organization of a Person; and (e) any amendment
to any of the foregoing.
"OTHER CONTRACT" -- any Contract (other than an Advertising Contract, a
Site Lease or the Non-Solicitation Agreements) relating to or affecting the
Purchased Assets (i) under which Seller
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has or may acquire any rights, (ii) under which Seller has or may become subject
to any obligation or liability, or (iii) by which Seller or any of the Purchased
Assets is or may become bound.
"OWNED REAL PROPERTY" -- as defined in Section 2.2(c).
"PARTY" -- as defined in the first paragraph of this Agreement.
"PARTIES" -- as defined in the first paragraph of this Agreement.
"PERMITS" -- as defined in Section 2.2(b).
"PERMITTED LIENS" -- liens for Taxes (other than Income Taxes) not yet
delinquent, interests of lessors, liens securing liabilities which are Assumed
Liabilities, or for other liens (not securing any indebtedness or which are not
otherwise dischargeable by the payment of a sum certain) which are immaterial in
character and do not prohibit and would not prohibit the use of the Purchased
Assets for their intended purpose.
"PERSON" -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, or other entity
or Governmental Body.
"PROCEEDING" -- any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced or brought by any Person relating to the Purchased Assets,
the Business, this Agreement or any of the transactions contemplated by this
Agreement.
"PURCHASE PRICE" -- as defined in Section 2.7.
"PURCHASED ASSETS" -- as defined in Section 2.2.
"RELEASE" -- any spilling, leaking, emitting, discharging, depositing,
escaping, leaching, dumping, or other releasing into the Environment, whether
intentional or unintentional.
"REPRESENTATIVE" -- with respect to a particular Person, any director,
officer, employee, agent, consultant, advisor, or other representative of such
Person, including legal counsel, accountants, and financial advisors.
"SECURITY INTEREST" -- any mortgage, pledge, lien, encumbrance, charge or
other security interest or option or right of any third party with respect
thereto.
"SELLER" -- as defined in the first paragraph of this Agreement.
"SITE LEASES" -- as defined in Section 2.2(d).
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"STOCKHOLDERS" -- all of the stockholders of Seller.
"STRUCTURES" -- as defined in Section 2.2(a).
"TAX OR TAXES" -- shall mean all tax (including income tax, capital gains
tax, value added tax, sales tax, property tax, transfer tax or intangibles tax),
levy assessment, tariff, duty, deficiency or other fee and any related charge or
amount (including fine, penalty and interest) imposed, assessed or collected by
or under the authority of any Governmental Body.
"TAX RETURN" -- any return (including any information return), report,
statement, schedule, notice, form, or other document or information filed with
or submitted to, or required to be filed with or submitted to, any Governmental
Body in connection with the determination, assessment, collection, or payment of
any Tax or in connection with the administration, implementation, or enforcement
of or compliance with any Legal Requirement relating to any Tax.
"THREATENED" -- a claim, Proceeding or dispute will be deemed to have been
"THREATENED" if any demand or statement has been made or any notice has been
given that would lead a prudent Person to conclude that such a claim, Proceeding
or dispute is likely to be asserted, commenced, taken, or otherwise pursued in
the future.
"TRI-STATE PARTNERS" -- Tri-State Partners, a Georgia general partnership.
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EXHIBIT B
ASSIGNMENT OF CONTRACTS
THIS ASSIGNMENT, made and entered into this ____ day of ___________, 1997,
by and between TRI-STATE SYSTEMS, INC., a Georgia corporation ("Assignor") and
TRI-STATE OUTDOOR MEDIA GROUP, INC., a Kansas corporation ("Assignee").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Asset Purchase Agreement dated
_______________, 1997 by and between Assignor and Assignee (the "Purchase
Agreement"), Assignor agreed to sell to Assignee and Assignee agreed to purchase
from Assignor, for the consideration and upon the terms and conditions set forth
in the Purchase Agreement, the Purchased Assets (as defined in the Purchase
Agreement), including, but not limited to, Assignor's rights in and to the Site
Leases, the Advertising Contracts, the Non-Solicitation Agreements and the
Assumed Other Contracts.
NOW, THEREFORE, for good and valuable consideration, the premises, and the
mutual covenants herein contained, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, the parties agree as follows:
1. Assignor hereby transfers and assigns to Assignee all of Assignor's
right, title and interest in and to the Site Leases, the Advertising Contracts,
the Non-Solicitation Agreements and the Assumed Other Contracts.
2. Assignee, by its acceptance hereof, does hereby assume and agree to
perform to the extent required by the terms of the Purchase Agreement any and
all obligations and duties of Assignor as a party under the Site Leases, the
Advertising Contracts, the Non-Solicitation Agreements and the Assumed Other
Contracts.
3. Assignor hereby covenants to execute and deliver to Assignee, upon
Assignee's reasonable request therefore, such further reasonable instruments of
assignment and transfer as may be necessary or desirable to (a) transfer to
Assignee all of such Assignor's right, title and interest in and to the Site
Leases, the Advertising Contracts, the Non-Solicitation Agreements and the
Assumed Other Contracts, or (b) evidence such assignment or transfer to
Assignee.
4. This Assignment of Contracts shall inure to the benefit of, and be
binding upon, the respective legal representatives, successors and permitted
assigns of the Parties hereto.
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5. Nothing in this Agreement supersedes or extinguishes any of the
obligations, agreements, covenants or warranties of Seller or Buyer contained in
the Purchase Agreement. If any conflict exists between this Agreement and the
Purchase Agreement, then the terms of the Purchase Agreement shall govern and
control.
IN WITNESS WHEREOF, Assignor and Assignee have caused this Agreement to be
executed and delivered as of the date first above written.
ASSIGNOR:
TRI-STATE SYSTEMS, INC.
By:___________________________________
Xxxxxx X. Xxxxxx
President
ASSIGNEE:
TRI-STATE OUTDOOR MEDIA GROUP, INC.
By:___________________________________
Title:________________________________
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EXHIBIT C
XXXX OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT
This Xxxx of Sale, Assignment and Assumption Agreement (the "Agreement")
is executed and delivered effective as of ___________, 1997, by TRI-STATE
SYSTEMS, INC., a Georgia corporation ("Seller"), and TRI-STATE MEDIA GROUP,
INC., a Kansas corporation ("Buyer").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Asset Purchase Agreement dated
_______________, 1997 by and between Seller and Buyer (the "Purchase
Agreement"), Seller desires to sell to Buyer and Buyer wishes to purchase from
Seller, for the consideration and upon the terms and conditions set forth in the
Purchase Agreement, the Purchased Assets (as defined in the Purchase Agreement),
subject to the assumption by Buyer of the Assumed Liabilities (as defined in the
Purchase Agreement);
NOW, THEREFORE, in consideration of the premises, and for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed that:
1. Conveyance of Assets. Seller does hereby contribute, grant, convey,
assign, transfer and deliver to Buyer all right, title and interest of Seller in
and to all of the Purchased Assets, subject to the Assumed Liabilities.
2. Assumption of Liabilities. Buyer does hereby assume and agree to pay,
discharge and perform, as appropriate, the Assumed Liabilities in accordance
with and to the extent required by the terms of the Purchase Agreement.
3. Power of Attorney. Seller hereby constitutes and appoints Buyer its
true and lawful attorney-in-fact, with full power of substitution of Buyer in
the name or stead of Seller (a) to demand, collect, and receive for the account
of Seller or Buyer any or all of the Purchased Assets hereby sold, conveyed,
transferred, assigned, and delivered to Buyer or intended so to be; (b) from
time to time to institute or prosecute, in the name of Seller or otherwise, all
proceedings that Buyer, in its sole discretion, may deem necessary or convenient
in order to realize upon, affirm, or obtain title to or possession of, or to
collect, assert, or enforce any claim, right or title of any kind in or to the
Purchased Assets; (c) to endorse the name of Seller on any and all checks,
notes, drafts or other instruments of commercial paper that may be payable or
endorsed to the order or orders of Seller and that constitute or represent all
or any part of the Purchased Assets; (d) to defend and compromise any and all
actions, suits or proceedings in respect of any of the Purchased Assets; and
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(e) to do all such other acts and things in relation to the Purchased Assets as
Buyer, in its sole discretion, deems desirable. Seller agrees that the foregoing
powers are coupled with an interest and shall not be revocable by Seller for any
reason whatsoever.
4. Execution and Delivery of Instruments. Seller shall duly execute and
deliver or cause to be executed and delivered all instruments of sale,
conveyance, transfer and assignment, and all notices, releases, acquittances and
other documents that may be necessary more fully to grant, convey, transfer,
assign, and deliver to and vest in Buyer the Purchased Assets hereby granted,
conveyed, transferred, assigned, and delivered or intended so to be.
5. Governing Law. This Agreement shall be governed by the laws of the
state of Georgia.
6. Conflict. Nothing in this Agreement supersedes or extinguishes any of
the obligations, agreements, covenants or warranties of Seller or Buyer
contained in the Purchase Agreement. If any conflict exists between this
Agreement and the Purchase Agreement, then the terms of the Purchase Agreement
shall govern and control.
IN WITNESS WHEREOF, Seller and Buyer have caused this Agreement to be
executed and delivered as of the date first above written.
SELLER:
TRI-STATE SYSTEMS, INC.
By:_____________________________________
Title:__________________________________
BUYER:
TRI-STATE OUTDOOR MEDIA GROUP INC.
By:_____________________________________
Title:__________________________________
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SCHEDULE 3.2(a)
Pursuant to an Agreement for Sale of Stock dated as of April 14, 1997 by and
among North American Acquisitions, Inc., a Wyoming corporation ("NAA"),
Tri-State Partners, the partners of Tri-State Partners, the Seller, and the
stockholders of Seller, the Seller and Indemnifying Stockholders are a party to
an Agreement regarding the voting of the stock of Seller by NAA after the sale
of the stock to NAA.
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SCHEDULE 3.2(b)
All agreements of Seller with Xxxxxx.
The Courtesy Leases.
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SCHEDULE 3.2(c)
The consent of Xxxxxx is required under the agreements of Seller with Xxxxxx.
All indebtedness of Seller to Xxxxxx will be satisfied at Closing and such
agreements terminated.
The Courtesy Leases require consent to assignment, as well as the ground leases
requiring notification or consent on the attached lists.
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SCHEDULE A.1
MONTHLY PAYMENTS NOT INCLUDED IN ACCOUNTS PAYABLE ON BALANCE SHEET
1. Xxxxx Xxxxxxxxx $ 75.00 (illum. exp.)
2. Xxxxxx Xxxxxxx 75.00 (illum. exp.)
3. College Park Storage 53.00 (PSD Mat & Supply)
4. Colonial Mini Storage 64.00 (PSD Mat & Supply)
5. Expense reports--Payment period: within one week after presentment.
6. Contract painters--Payment period: the later of 7 days after work performed
or xxxx presented for payment.
7. Light bills--Payment period: on or before the due date.
8. Land rent--Payment period: within 5 days after the last day of month in which
the rent is due and owing.
9. Phone bills (if due date is before accounts payable run)--Payment period: on
or before the due date.
The payment periods for each of the items in 1 through 4 is the first day of
each month.
Payables arising prior to the Closing and outstanding at Closing with respect to
items 1 through 9 above shall be included in the definition of Assumed
Liabilities provided that in each case such payables are not older than the
applicable payment periods described above.
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