ASSET PURCHASE AGREEMENT by and among WINSONIC McCRARY, LLC, COLONEL McCRARY TRUCKING, LLC THE MEMBERS OF COLONEL McCRARY TRUCKING, LLC and LARRY FLETCHER, AS SELLER REPRESENTATIVE DATED NOVEMBER 20, 2007
Exhibit
10.1
[EXECUTION
VERSION]
by
and
among
WINSONIC
XxXXXXX, LLC,
COLONEL
XxXXXXX TRUCKING, LLC
THE
MEMBERS OF COLONEL XxXXXXX TRUCKING, LLC
and
XXXXX
XXXXXXXX, AS SELLER REPRESENTATIVE
DATED
NOVEMBER 20, 2007
TABLE
OF CONTENTS
Page
DEFINITIONS
|
1
|
|
Section
1.1
|
Certain
Definitions
|
1
|
|
Section
1.2
|
Other
Definitions
|
7
|
|
Section
1.3
|
Accounting
Terms
|
7
|
Article
II
|
PURCHASE
AND SALE
|
8
|
|
Section
2.1
|
Agreement
to Purchase and Sell
|
8
|
|
Section
2.2
|
Excluded
Assets
|
9
|
|
Section
2.3
|
Assumption
of Assumed Liabilities
|
9
|
Article
III
|
PURCHASE
PRICE; ALLOCATIONS
|
10
|
|
Section
3.1
|
Purchase
Price
|
10
|
|
Section
3.2
|
Payment
of Purchase Price
|
10
|
|
Section
3.3
|
Allocation
of Purchase Price
|
10
|
|
Section
3.4
|
Allocation
of Certain Items
|
10
|
Article
IV
|
REPRESENTATIONS
AND WARRANTIES
OF THE SELLER AND THE MEMBERS
|
11
|
|
Section
4.1
|
Organization
|
11
|
|
Section
4.2
|
Authorization
|
11
|
|
Section
4.3
|
Absence
of Restrictions and Conflicts
|
12
|
|
Section
4.4
|
Consents
|
12
|
|
Section
4.5
|
Real
Property
|
12
|
|
Section
4.6
|
Personal
Property
|
12
|
|
Section
4.7
|
Sufficiency
of and Title to Assets
|
13
|
|
Section
4.8
|
Inventory
|
13
|
|
Section
4.9
|
Financial
Statements
|
13
|
|
Section
4.10
|
No
Undisclosed Liabilities
|
14
|
|
Section
4.11
|
Absence
of Certain Changes
|
14
|
|
Section
4.12
|
Legal
Proceedings
|
14
|
|
Section
4.13
|
Compliance
with Law
|
14
|
|
Section
4.14
|
Contracts
|
14
|
|
Section
4.15
|
Tax
Returns; Taxes
|
15
|
-i-
TABLE
OF CONTENTS
(continued)
Page
|
Section
4.16
|
Employees
and Independent Contractors
|
15
|
|
Section
4.17
|
Seller
Benefit Plans
|
16
|
|
Section
4.18
|
Labor
Relations
|
16
|
|
Section
4.19
|
Insurance
Policies
|
16
|
|
Section
4.20
|
Environmental,
Health and Safety Matters
|
17
|
|
Section
4.21
|
Intellectual
Property
|
18
|
|
Section
4.22
|
Software
|
18
|
|
Section
4.23
|
Affiliate
Matters
|
18
|
|
Section
4.24
|
Customer
and Supplier Relations
|
18
|
|
Section
4.25
|
Licenses
|
19
|
|
Section
4.26
|
Product
and Service Warranties
|
19
|
|
Section
4.27
|
Brokers,
Finders and Investment Bankers
|
19
|
|
Section
4.28
|
Disclosure
|
19
|
Article
V
|
REPRESENTATIONS
AND WARRANTIES OF THE MEMBERS
|
19
|
|
Section
5.1
|
Authorization
and Validity of Agreement
|
20
|
|
Section
5.2
|
Absence
of Restrictions and Conflicts
|
20
|
|
Section
5.3
|
Legal
Proceedings
|
20
|
|
Section
5.4
|
Investment
Representations
|
20
|
Article
VI
|
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
|
21
|
|
Section
6.1
|
Organization
|
21
|
|
Section
6.2
|
Authorization
|
21
|
|
Section
6.3
|
Absence
of Restrictions and Conflicts
|
21
|
Article
VII
|
CERTAIN
COVENANTS AND AGREEMENTS
|
22
|
|
Section
7.1
|
Conduct
of Business by the Seller
|
22
|
|
Section
7.2
|
Notices
of Certain Events
|
23
|
|
Section
7.3
|
No
Solicitation of Transactions
|
24
|
|
Section
7.4
|
Reasonable
Efforts; Further Assurances; Cooperation
|
24
|
|
Section
7.5
|
Consents
|
24
|
|
Section
7.6
|
Transfer
Taxes; Expenses
|
25
|
-ii-
TABLE
OF CONTENTS
(continued)
Page
|
Section
7.7
|
Insurance
|
25
|
|
Section
7.8
|
Receivables
|
25
|
|
Section
7.9
|
Risk
of Loss
|
25
|
Article
VIII
|
CONDITIONS
TO CLOSING
|
26
|
|
Section
8.1
|
Conditions
to Obligations of the Purchaser
|
26
|
|
Section
8.2
|
Conditions
to Obligations of the Seller and the Members
|
27
|
Article
VIII
|
CLOSING
|
28
|
|
Section
9.1
|
Closing
|
28
|
|
Section
9.2
|
Seller
Closing Deliveries
|
28
|
|
Section
9.3
|
Purchaser
Closing Deliveries
|
29
|
Article
X
|
TERMINATION
|
29
|
|
Section
10.1
|
Termination
|
29
|
|
Section
10.2
|
Specific
Performance and Other Remedies
|
29
|
|
Section
10.3
|
Effect
of Termination
|
30
|
Article
XI
|
INDEMNIFICATION
|
30
|
|
Section
11.1
|
Indemnification
Obligations of the Members
|
30
|
|
Section
11.2
|
Indemnification
Obligations of the Purchaser
|
31
|
|
Section
11.3
|
Indemnification
Procedure.
|
31
|
|
Section
11.4
|
Survival
Period
|
33
|
|
Section
11.5
|
Liability
Limits
|
34
|
|
Section
11.6
|
Investigations
|
34
|
|
Section
11.7
|
Set-Off
|
34
|
|
Section
11.8
|
Exclusive
Remedy
|
34
|
Article
XII
|
MISCELLANEOUS
PROVISIONS
|
34
|
|
Section
12.1
|
Seller
Representative
|
34
|
|
Section
12.2
|
Notices
|
35
|
|
Section
12.3
|
Schedules
and Exhibits
|
36
|
|
Section
12.4
|
Assignment;
Successors in Interest
|
36
|
|
Section
12.5
|
Captions
|
36
|
-iii-
TABLE
OF CONTENTS
(continued)
Page
|
Section
12.6
|
Controlling
Law
|
36
|
|
Section
12.7
|
Severability
|
36
|
|
Section
12.8
|
Counterparts
|
37
|
|
Section
12.9
|
Enforcement
of Certain Rights
|
37
|
|
Section
12.10
|
Waiver;
Amendment
|
37
|
|
Section
12.11
|
Integration
|
37
|
|
Section
12.12
|
Compliance
with Bulk Sales Laws
|
37
|
|
Section
12.13
|
Interpretation
|
37
|
|
Section
12.14
|
Cooperation
Following the Closing
|
37
|
|
Section
12.15
|
Transaction
Costs
|
37
|
-iv-
THIS
ASSET PURCHASE AGREEMENT, dated as of November 20, 2007, is made and entered
into by and between WINSONIC XXXXXXX, LLC, a Georgia limited liability company
(the “Purchaser”), COLONEL XXXXXXX TRUCKING, LLC, a Georgia limited
liability company (the “Seller”), Xx. Xxx Xxxxxxx, an individual resident
of the state of Georgia (“Xx. Xxxxxxx”), Xx. Xxxxxx X. Xxxxxx, an
individual resident of the state of Georgia (“Xx. Xxxxxx”), Mr. Xxxx
Xxxx, an individual resident of the state of Georgia (“Xx. Xxxx”), Xx.
Xxxx XxXxxxx, an individual resident of the state of Georgia (“Xx.
XxXxxxx”), Xx. Xxxxxxx XxXxxxxxxx, an individual resident of the state of
Georgia (“Xx. XxXxxxxxxx”), and Xx. Xxxxx Xxxxxxxx, an individual
resident of the state of Georgia (“Xx. Xxxxxxxx” and collectively with
Xx. Xxxxxxx, Xx. Xxxxxx, Xx. Xxxx, Xx. XxXxxxx and Xx. XxXxxxxxxx, the
“Members” and individually, a “Member”).
RECITALS:
WHEREAS,
upon and subject to the terms and conditions set forth herein, the Seller
desires to sell to the Purchaser, and the Purchaser desires to purchase from
the
Seller, substantially all of the assets used or held for use by the Seller
in
the conduct of its business as a going concern, and the Purchaser desires
to
assume certain of the liabilities and obligations of the Seller as set forth
herein;
NOW,
THEREFORE, in consideration of the foregoing and the respective representations,
warranties, covenants, agreements and conditions set forth herein and other
good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound hereby, each Party hereby
agrees
as follows:
ARTICLE
I
DEFINITIONS
Section
1.1 Certain
Definitions. The following terms, as used herein, have the
meanings set forth below:
“Affiliate”
of any specified Person means any other Person directly or indirectly
Controlling or Controlled by or under direct or indirect common Control with
such specified Person.
“Agreement”
means this Asset Purchase Agreement, as amended from time to time.
“Assumed
Contracts” means those Contracts to which the Seller is a party and which
relate to the Business; provided, however, that the Assumed Contracts shall
not
include any Contract which is an Excluded Asset.
“Audited
Financial Statements” means an audited balance sheet of the Seller as of
December 31, 2006 and statements of income and cash flows of the Seller for
December 31, 2006.
“Business”
means the business of (i) dirt, rock and gravel sales, (ii) hauling and
transportation of dirt, rock and gravel and (iii) providing technology and
management services to small and midsize trucking companies, including Global
Positioning System and telecommunications services.
“Business
Day” means any day except Saturday, Sunday or any day on which banks are
generally not open for business in the City of New York, New York.
“Closing”
means the consummation of the purchase and sale of the Assets and the assumption
of the Assumed Liabilities, as set forth in Article
VIII of this Agreement.
“Closing
Date” means the date on which the Closing occurs.
“Code”
means the United States Internal Revenue Code of 1986.
“Contract”
means any contract, sub-contract, agreement, lease, license, commitment,
sale
and purchase order, note, loan agreement or any other instrument, arrangement,
or understanding of any kind, whether written or oral, and whether express
or
implied.
“Control”
means, when used with respect to any specified Person, the power to direct
the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by Contract or otherwise.
“Employee
Benefit Plan” means, with respect to any Person, each plan, fund, program,
agreement, arrangement or scheme, including each plan, fund, program, agreement,
arrangement or scheme maintained or required to be maintained under applicable
Laws, that is at any time sponsored or maintained or required to be sponsored
or
maintained by such Person or to which such Person makes or has made, or has
or
has had an obligation to make, contributions providing benefits to the current
and former employees, directors, managers, officers, consultants, independent
contractors, contingent workers or leased employees of such Person or the
dependents of any of them (whether written or oral), or with respect to which
such Person has any liability or obligation, including (a) each deferred
compensation, bonus, incentive compensation, pension, retirement, employee
stock
ownership, stock purchase, stock option, profit sharing or deferred profit
sharing, stock appreciation, phantom stock plan and other equity compensation
plan, “welfare” plan (within the meaning of Section 3(1) of ERISA, determined
without regard to whether such plan is subject to ERISA), (b) each “pension”
plan (within the meaning of Section 3(2) of ERISA, determined without regard
to
whether such plan is either subject to ERISA or is tax-qualified under the
Code), (c) each severance plan or agreement, and each other plan providing
health, vacation, supplemental unemployment benefit, hospitalization insurance,
medical, dental, disability, life insurance, death or survivor benefits,
fringe
benefits or legal benefits and (d) each other employee benefit plan, fund,
program, agreement or arrangement.
“Employment
Agreement” means any employment contract, consulting agreement, termination
or severance agreement, salary continuation agreement, change of control
agreement or any other Contract, including offers for any of the above,
respecting the terms and conditions of employment or payment of compensation
in
respect to any current or former officer or employee.
“Environmental
Laws” means all Laws and common law relating to pollution or protection of
health, safety or the environment, including the Federal Water Pollution
Control
Act (33 U.S.C. §1251 et seq.), Resource Conservation and Recovery Act (42 X.X.X.
§0000 et seq.), Safe Drinking Water Act (42 U.S.C. §3000(f) et seq.), Toxic
Substances Control Act (15 X.X.X. §0000 et seq.), Clean Air Act (42 X.X.X. §0000
et seq.), Comprehensive Environmental Response, Compensation and Liability
Act
(42 X.X.X. §0000 et seq.) and other similar federal, state and local
statutes.
“ERISA”
means the United States Employee Retirement Income Security Act of
1974.
“ERISA
Affiliate” means any Person that together with the Seller would be deemed a
“single employer” within the meaning of Section 414 of the Code.
“ERISA
Affiliate Plan” means each Employee Benefit Plan sponsored or maintained or
required to be sponsored or maintained at any time by any ERISA Affiliate,
or to
which such ERISA Affiliate makes or has made, or has or has had an obligation
to
make, contributions at any time, or with respect to which such ERISA Affiliate
has any liability or obligation.
“FMLA”
means the United States Family and Medical Leave Act.
“GAAP”
means United States generally accepted accounting principles.
“Governmental
Entity” means any (a) nation, state, commonwealth, county, city, town,
village, district, or other jurisdiction of any nature, (b) federal, state,
local, municipal, foreign, or other government, (c) federal, state, local
or foreign governmental or quasi-governmental authority of any nature (including
any agency, branch, department, board, commission, court or tribunal),
(d) multi-national or supra-national organization or body, (e) body
exercising, or entitled or purporting to exercise, any administrative,
executive, judicial, legislative, police, regulatory, or taxing authority
or
power, including any court or arbitrator, (f) self-regulatory organization
or (g) official of any of the foregoing.
“Hazardous
Materials” means any pollutant, chemical, substance and any toxic,
infectious, carcinogenic, reactive, corrosive, ignitable or flammable chemical,
or chemical compound, or hazardous substance, material or waste, whether
solid,
liquid or gas, that is subject to regulation, control or remediation under
any
Environmental Laws, including any quantity of friable asbestos, urea
formaldehyde, polychlorinated biphenyls, radon gas, crude oil or any fraction
thereof, all forms of natural gas, petroleum products or by-products or
derivatives.
“Indemnified
Party” means a Purchaser Indemnified Party or a Seller Indemnified
Party.
“Intellectual
Property” means any or all of the following and all rights, arising out of
or associated therewith: (a) all United
States patents and applications therefor and all reissues,
divisions, renewals, extensions, provisionals, continuations and
continuations-in-part thereof; (b) all inventions (whether patentable or
not), invention disclosures, improvements, proprietary information, know-how,
technology, technical data and customer lists, and all documentation relating
to
any of the foregoing; (c) all copyrights, copyright registrations and
applications therefor, and all other rights corresponding thereto; (d) all
industrial designs and any registrations and applications therefor; (e) all
internet uniform resource locators, domain names, trade names,
logos,
slogans, designs, common law trademarks and service marks, trademark and
service
xxxx registrations and applications therefor; (f) all databases and data
collections and all rights therein; (g) all moral and economic rights of
authors and inventors, however denominated; and (h) any similar or
equivalent rights to any of the foregoing.
“Knowledge”
means, with respect to the Seller, all facts known by any officer of the
Seller
or any of the Members on the date hereof or on the Closing Date following
reasonable inquiry and diligence with respect to the matters at
hand.
“Labor
Laws” means all Laws governing or concerning labor relations, unions and
collective bargaining, conditions of employment, employee classification,
employment discrimination and harassment, wages, hours or occupational safety
and health, including ERISA, the United States Immigration Reform and Control
Act of 1986, the United States National Labor Relations Act, the United States
Civil Rights Acts of 1866 and 1964, the United States Equal Pay Act, the
United
States Americans with Disabilities Act, the United States Age Discrimination
in
Employment Act, FMLA, WARN, OSHA, the United States Xxxxx Bacon Act, the
United
States Xxxxx-Xxxxx Act, the United States Service Contract Act, United States
Executive Order 11246, the United States Fair Labor Standards Act and the
United
States Rehabilitation Act of 1973.
“Laws”
means all laws, statutes, common law, rules, codes, regulations, restrictions,
ordinances, orders, decrees, approvals, directives, judgments, rulings,
injunctions, writs, awards and decrees of, or issued or entered by, all
Governmental Entities.
“Leased
Real Property” means the parcel of real property located at 0000 Xxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx.
“Licenses”
means all notifications, licenses, permits (including environmental,
construction and operation permits), franchises, certificates, approvals,
exemptions, classifications, registrations and other similar documents and
authorizations issued by any Governmental Entity, and applications
therefor.
“Liens”
means all mortgages, liens, pledges, security interests, charges, claims,
restrictions and encumbrances of any nature whatsoever.
“Material
Adverse Effect” means any state of facts, change, event, effect or
occurrence (when taken together with all other states of fact, changes, events,
effects or occurrences) that has, has had or is reasonably likely to have
a
materially adverse effect on the financial condition, results of operations,
prospects, properties, assets or liabilities (including contingent liabilities)
of the Seller or the Assets. A Material Adverse Effect shall also
include any state of facts, change, event or occurrence that shall have occurred
or been threatened that (when taken together with all other states of facts,
changes, events, effects or occurrences that have occurred or been threatened)
has prevented or materially delayed, or would be reasonably likely to prevent
or
materially delay, the performance by the Seller or the Members of their
obligations hereunder or the consummation of the transactions contemplated
hereby.
“NLRB”
means the United States National Labor Relations Board.
“Non-Assignable
Contracts” means Assumed Contracts that require third-party consents for
assignment that have not been obtained by the Seller as of the
Closing.
“OSHA”
means the United States Occupational Safety and Health
Administration.
“Owned
Real Property” means the parcels of real property which the Seller owns
(together with all fixtures and improvements thereon).
“Parent
Stock” means the common stock, par value $0.001, of Winsonic Digital Media
Group, Ltd., a Georgia corporation.
“Party”
or “Parties” means, individually, the Purchaser, the Seller, each Member
and the Seller Representative and, collectively, the Purchaser, the Seller,
the
Members and the Seller Representative.
“Paychex
Employee” means any individual employed by Paychex, Inc.
“Permitted
Liens” means (a) Liens for Taxes not yet due and payable (excluding
Liens arising under ERISA or Code Section 412), (b) Liens of carriers,
warehousemen, mechanics, materialmen and repairmen incurred in the ordinary
course of business consistent with past practice and not yet delinquent,
(c) in
the case of the Real Property, zoning, building, or other restrictions,
variances, covenants, rights of way, encumbrances, easements and other minor
irregularities in title, none of which, individually or in the aggregate,
(i)
interfere in any material respect with the present use of or occupancy of
the
affected parcel by the Seller, (ii) have more than an immaterial effect on
the
value thereof or its use or (iii) would impair the ability of such parcel
to be
sold for its present use, and (d) the Liens set forth on Exhibit
1.1(a).
“Person”
means any individual, corporation, partnership, joint venture, limited liability
company, trust, unincorporated organization or Governmental Entity.
“Preliminary
Financial Statements” means (a) the unaudited balance sheets of the Seller
as of December 31, 2005, December 31, 2006 and May 31, 2007, and (b) the
unaudited statements of income of the Seller for the 12-month period ended
December 31, 2005, the 12-month period ended December 31, 2006, and the
five-month period ended May 31, 2007.
“Purchaser
Ancillary Documents” means any certificate, agreement, document or other
instrument, other than this Agreement, to be executed and delivered by the
Purchaser in connection with the transactions contemplated hereby.
“Purchaser
Benefit Plan” means any Employee Benefit Plan maintained by the Purchaser or
any of its Affiliates.
“Purchaser
Indemnified Parties” means the Purchaser and its Affiliates, their
respective officers, directors, employees, agents and representatives and
the
heirs, executors, successors and assigns of any of the foregoing.
“Real
Property” means the Leased Real Property and the Owned Real
Property.
“Receivables”
means the Seller’s accounts receivable, notes receivable and other receivables
as of the close of business on the Closing Date.
“Registered
Intellectual Property” means all United States: (a) patents and patent
applications (including provisional applications); (b) registered
trademarks and service marks, applications to register trademarks and service
marks, intent-to-use applications, or other registrations or applications
related to trademarks and service marks; (c) registered copyrights and
applications for copyright registration; (d) domain name registrations; and
(e) any other Intellectual Property that is the subject of an application,
certificate, filing, registration or other document issued, filed with, or
recorded with any Governmental Entity.
“Release”
means, with respect to any Hazardous Material, any spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
dumping
or disposing into any surface or ground water, drinking water supply, soil,
surface or subsurface strata or medium, or the ambient air.
“Seller
Ancillary Documents” means any certificate, agreement, document or other
instrument, other than this Agreement, to be executed and delivered by the
Seller or a Member in connection with the transactions contemplated
hereby.
“Seller
Benefit Plan” means each Employee Benefit Plan sponsored or maintained or
required to be sponsored or maintained at any time by the Seller or to which
the
Seller makes or has made, or has or has had an obligation to make, contributions
at any time or with respect to which the Seller has any liability or
obligation.
“Seller
Indemnified Parties” means the Seller, the Members and their respective
officers, directors, employees, agents and representatives and the heirs,
executors, successors and assigns of any of the foregoing.
“Seller
Intellectual Property” means any Intellectual Property that is owned by or
licensed to the Seller, including the Seller Software.
“Seller
Registered Intellectual Property” means all of the Registered Intellectual
Property owned by, filed in the name of, or licensed to the Seller.
“Seller
Software” means all software used by the Seller in the
Business.
“Software”
means any computer software program, together with any error corrections,
updates, modifications, or enhancements thereto, in both machine-readable
form
and human-readable form, including all comments and any procedural
code.
“Taxes”
means all taxes, assessments, charges, duties, fees, levies and other charges
of
a Governmental Entity, including income, franchise, capital stock, real
property, personal property, tangible, withholding, employment, payroll,
social
security, social contribution, unemployment compensation, disability, transfer,
sales, use, excise, gross receipts, value-added and all other taxes of any
kind
(including taxes under Treasury Regulation Section 1.1502-6) for which the
Seller or the Purchaser may have any liability imposed by any Governmental
Entity, whether
disputed
or not, and any related charges, interest or penalties imposed by any
Governmental Entity.
“Tax
Return” means any report, return, declaration or other information, in
whatever form or medium, required to be supplied to a Governmental Entity
in
connection with Taxes, including estimated returns and reports of every kind
with respect to Taxes.
“Transferred
Employee” means an employee of the Seller who accepts an offer of employment
from the Purchaser. Such employee shall be considered a “Transferred
Employee” as of the time he or she first performs services for the Purchaser on
or after the Closing Date.
“Treasury
Regulations” means the temporary and final income Tax regulations,
promulgated under the Code.
“WARN”
means the United States Worker Adjustment and Retraining Notification Act
and
similar state Laws.
Section
1.2 Other
Definitions. Each of the following terms is defined in the
Section set forth opposite such term:
Term | Section | |
Acquisition
Transaction
|
7.3
|
|
Assets
|
2.1
|
|
Assumed
Liabilities
|
2.3(b)
|
|
Assumption
Agreement
|
9.2(c)
|
|
Xxxx
of Sale
|
9.2(b)
|
|
Customer
|
4.24
|
|
Excluded
Assets
|
2.2
|
|
Expiration
Date
|
10.1(e)
|
|
Indemnifying
Party
|
11.3(a)
|
|
Members
|
Preamble
|
|
Notice
of Claim
|
11.3(c)
|
|
Parties
|
Preamble
|
|
Party
|
Preamble
|
|
Purchase
Price
|
3.1
|
|
Purchaser
|
Preamble
|
|
Purchaser
Cap
|
11.5
|
|
Purchaser
Losses
|
11.1
|
|
Seller
|
Preamble
|
|
Seller
Losses
|
11.2
|
|
Seller
Representative
|
Preamble
|
|
Supplier
|
4.24
|
Section
1.3 Accounting
Terms. All accounting terms not specifically defined herein shall
be construed in accordance with GAAP.
ARTICLE
II
PURCHASE
AND SALE
Section
2.1 Agreement
to Purchase and Sell. Subject to the terms and conditions hereof,
at the Closing, the Seller shall sell, assign, transfer and deliver to the
Purchaser, and the Purchaser shall purchase and acquire from the Seller,
all
right, title and interest of the Seller in and to, except for the Excluded
Assets, all of its assets, properties and rights of every kind, nature,
character and description, whether real, personal or mixed, whether tangible
or
intangible, and wherever situated, in existence on the date hereof and any
additions thereto on or before the Closing Date (such assets, properties
and
rights, being referred to as the “Assets”), free and clear of all Liens
other than Permitted Liens. The Assets shall include the Seller’s
right, title and interest in and to the following assets, properties and
rights:
(a) cash,
cash equivalents and marketable securities and all rights to any bank
accounts;
(b) inventory,
including finished goods, supplies, raw materials, work in progress, spare,
replacement and component parts, and other inventory property located at,
stored
on behalf of or in transit to the Seller;
(c) deposits,
advances, pre-paid expenses and credits;
(d) fixed
assets, vehicles, equipment, machinery, tools, furnishings, computer hardware
and fixtures;
(e) the
Assumed Contracts;
(f) the
goodwill, patents, patent applications, copyrights, copyright applications,
methods, know-how, Software, technical documentation, processes, procedures,
inventions, trade secrets, trademarks, trade names, service marks, service
names, registered user names, technology, research records, data, designs,
plans, drawings, manufacturing know-how and formulas, whether patentable
or
unpatentable, and other intellectual or proprietary rights or property (and
all
rights thereto and applications therefor), including all Seller Intellectual
Property;
(g) the
Receivables, the proceeds thereof, and any security therefor;
(h) causes
of action, lawsuits, judgments, claims and demands of any nature, whether
arising by way of counterclaim or otherwise;
(i) all
express or implied guarantees, warranties, representations, covenants,
indemnities and similar rights;
(j) Licenses,
including those set forth on Schedule 4.26;
(k) insurance
proceeds and insurance awards receivable with respect to any of the Assets
which
arise from or relate to events occurring prior to or on the Closing
Date;
(l)
information, files, correspondence, records, data, plans, reports,
Contracts and recorded knowledge, including customer, supplier, price and
mailing lists, and all accounting or other books and records of the Seller
in
whatever media retained or stored, including computer programs and disks;
and
(m)
the Owned Real Property.
Section
2.2 Excluded
Assets. Notwithstanding anything to the contrary set forth
herein, the Assets shall not include the following assets, properties and
rights
of the Seller (collectively, the “Excluded Assets”):
(a) the
articles of organization and operating agreement and minute books of the
Seller;
(b) the
Leased Real Property and all licenses, permits, approvals, easements and
other
rights relating thereto;
(c) the
rights that accrue to the Seller hereunder;
(d) rights
to refunds of Taxes paid by the Seller, whether paid directly by the Seller
or
indirectly by a third party on the Seller’s behalf, regardless of whether such
rights have arisen or hereafter arise; and
(e) insurance
policies (and any cash or surrender value thereon).
Section
2.3 Assumption
of Assumed Liabilities.
(a) Except
as provided in Section
2.3(b), the Purchaser shall not assume, in connection with the transactions
contemplated hereby, any liability or obligation of the Seller whatsoever,
whether known or unknown, disclosed or undisclosed, accrued or hereafter
arising, absolute or contingent, and the Seller shall retain responsibility
for
all such liabilities and obligations.
(b) Effective
as of the Closing, the Purchaser shall assume the following liabilities and
obligations of the Seller (collectively, the “Assumed
Liabilities”):
(i) the
obligations of the Seller under each Assumed Contract, except to the extent
such
obligations are required to be performed on or prior to the Closing Date,
are
not disclosed on the face of such Assumed Contract, or accrue and relate
to the
operation of the Business prior to the Closing Date;
(ii) the
current liabilities of the Seller accrued on the Preliminary Financial
Statements and current liabilities of the Seller incurred in the ordinary
course
of business after the date of the Preliminary Financial Statements and on
or
before the Closing Date; and
(iii) those
debt obligations and other liabilities of Seller set forth on Exhibit
2.3(b)(iii) (the “Assumed Long-Term Liabilities”).
(c) Specifically
Excluded Liabilities. Except for the Assumed Liabilities,
Purchaser shall not assume any obligation or liability of Seller of any kind,
and Seller shall pay, satisfy and perform all of its obligations (other than
the
Assumed Liabilities), whether fixed, contingent, known or unknown and whether
existing as of the Closing or arising thereafter, which may affect in any
way
the transferred assets. Such specifically excluded liabilities shall
include all claims, actions, litigation and proceedings relating to any or
all
of the foregoing and all costs and expenses in connection
therewith.
ARTICLE
III
PURCHASE
PRICE; ALLOCATIONS
Section
3.1 Purchase
Price. The aggregate amount to be paid for the Assets (the
“Purchase Price”) shall be 4,287,490 shares of Parent
Stock. In addition to the foregoing payment, as consideration for the
sale, assignment, transfer and delivery of the Assets, the Purchaser shall
assume and discharge the Assumed Liabilities.
Section
3.2 Payment
of Purchase Price. On the Closing Date, the Purchaser shall
deliver, or shall arrange to be delivered, to each Member the portion of
the
Purchase Price set forth opposite such Member’s name on Exhibit
3.2.
Section
3.3 Allocation
of Purchase Price. The Purchase Price shall be allocated among
the Assets at their respective book values and any balance of the Purchase
Price
shall be allocated to goodwill. The Purchaser and the Seller shall
file their Tax Returns (and IRS Form 8594, if applicable) on the basis of
such allocation and neither Party shall thereafter take a Tax Return position
inconsistent with such allocation unless such inconsistent position shall
arise
out of or through an audit or other inquiry or examination by the Internal
Revenue Service or other Governmental Entity.
Section
3.4 Allocation
of Certain Items. With respect to certain expenses incurred in
the operations of the Seller, the following allocations shall be made between
the Seller on the one hand and the Purchaser on the other:
(a) Taxes. Real
and ad valorem property Taxes shall be apportioned at the Closing based upon
the
amounts set forth in the current tax bills therefor and the number of days
in
the taxable period prior to (and including) the Closing Date and in the taxable
period following the Closing Date.
(b) Utilities. Utilities,
water and sewer charges shall be apportioned based upon the number of Business
Days occurring prior to (and including) the Closing Date and following the
Closing Date during the billing period for each such charge.
Appropriate
cash payments by the Purchaser or the Seller, as the case may require, shall
be
made hereunder from time to time as soon as reasonably practicable after
the
facts giving rise to the obligation for such payments are known in the amounts
necessary to give effect to the allocations provided for in this Section
3.4.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF
THE SELLER AND THE MEMBERS
The
Seller and the Members hereby represent and warrant to the Purchaser as follows,
as of the date hereof and the Closing Date:
Section
4.1 Organization.
(a) The
Seller is a limited liability company duly organized, validly existing and
in
good standing under the Laws of the State of Georgia and has all requisite
corporate power and authority to own, lease and operate its properties and
to
carry on the Business as now being conducted. The authorized
ownership interests of the Seller are set forth on Schedule
4.1(a). The Members own all of the issued an outstanding
ownership interests of the Seller. There are no outstanding options,
warrants, conversion rights, subscriptions or other rights entitling any
Person
to acquire or receive, or requiring the Seller to issue, any ownership interests
or securities convertible into, or exchangeable for, such ownership
interests.
(b) The
Seller is duly qualified or registered as a foreign entity to transact business
under the Laws of each jurisdiction where the character of its activities
or the
location of the properties owned or leased by it requires such qualification
or
registration. Schedule 4.1(b) contains a true, correct
and complete list of the jurisdictions in which the Seller is qualified or
registered to do business as a foreign entity. The Seller has
heretofore delivered to the Purchaser true, correct and complete copies of
its
articles of organization and operating agreement as currently in effect and
its
corporate record books with respect to actions taken by its members and
managers.
(c) The
Seller does not own, directly or indirectly, any capital stock or other equity,
securities or interests in any other corporation or in any limited liability
company, partnership, joint venture or other Person. Except for the Business,
the Seller is not engaged in any other business or commercial
activity. All activities and operations of the Business are conducted
by the Seller and no Person (except in his or her capacity as a director,
officer or employee of the Seller) is engaged in the Business.
(d) There
are no assets, properties or rights (whether real, personal or mixed and
whether
tangible or intangible) that are owned or used by the Seller that are not
related to or utilized in the Business. There are no liabilities of
the Seller of any kind whatsoever, whether accrued, contingent, absolute
or
otherwise, that are not related to the Business.
Section
4.2
Authorization. The Seller has full corporate power and
authority to execute and deliver this Agreement and the Seller Ancillary
Documents and to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. This
Agreement has been, and the Seller Ancillary Documents shall be as of the
Closing Date, duly executed and delivered by the Seller and do or shall,
as the
case may be,
constitute
the valid and binding agreements of the Seller, enforceable against the Seller
in accordance with their respective terms.
Section
4.3 Absence
of Restrictions and Conflicts. The execution, delivery and
performance by the Seller of this Agreement and the Seller Ancillary Documents,
as applicable, the consummation of the transactions contemplated hereby and
thereby and the fulfillment of and compliance with the terms and conditions
hereof and thereof do not or shall not (a) contravene or conflict with any
term or provision of the articles of organization or operating agreement
of the
Seller, (b) except as indicated on Schedule 4.3, violate or conflict
with, constitute a breach of or default under, result in the loss of any
benefit
under, permit the acceleration of any obligation under or create in any party
the right to terminate, modify or cancel any Contract or License to which
the
Seller is a party, (c) contravene or conflict with any judgment, decree or
order of any Governmental Entity to which the Seller is a party or by which
the
Seller or any of its respective properties are bound, (d) contravene or
conflict with any Law or arbitration award applicable to the Seller, or (e)
result in the creation or imposition of any Lien on any
Asset.
Section
4.4 Consents. No
consent, approval, order or authorization of, or registration, declaration
or
filing with, any Governmental Entity is required with respect to the Seller
or
any of the Members in connection with the execution, delivery or performance
of
this Agreement or the Seller Ancillary Documents or the consummation of the
transactions contemplated hereby.
Section
4.5 Real
Property.
(a) Schedule
4.5(a) sets forth a true, correct and complete legal description of each
parcel of Owned Real Property. The Seller has good and marketable,
indefeasible, fee simple title to the Owned Real Property. The Seller
has delivered to the Purchaser true, correct and complete copies of the deeds
and other instruments (as recorded) by which the Seller acquired the Owned
Real
Property, and true, correct and complete copies of all title insurance policies,
abstracts and surveys relating to the Owned Real Property.
(b) Except
for the Permitted Liens, no Real Property is subject to (i) any Liens, (ii)
any
governmental decree or order (or, to the Knowledge of the Seller, threatened
or
proposed order) or (iii) any rights of way, building use restrictions,
exceptions, variances, reservations or limitations of any nature
whatsoever.
(c) There
are no improvements and fixtures on the Real Property. There is no
condemnation, expropriation or similar proceeding pending or, to the Knowledge
of the Seller, threatened against any of the Real Property or any improvement
thereon. The Real Property constitutes all of the real property
utilized by the Seller in the operation of the Business. None of the
Real Property is used for any purpose other than the operation of the
Business.
Section
4.6 Personal
Property. All equipment and other items of tangible personal
property and assets included in the Assets (a) are free of defects and in
good
operating condition and in a state of good maintenance and repair, ordinary
wear
and tear excepted and (b) were acquired and are usable in the regular and
ordinary course of business. All of the tangible
personal
property and assets included in the Assets are located at the Owned Real
Property. No Person other than the Seller owns any equipment or other
tangible personal property or asset that is necessary to the operation of
the
Business, except for the leased equipment, property or Assets listed on
Schedule 4.6.
Section
4.7 Sufficiency
of and Title to Assets. The Assets constitute all of the assets
(whether real, personal or mixed and whether tangible or intangible) necessary
and sufficient to permit the Seller to conduct the Business in accordance
with
the Seller’s past practices and as presently planned to be
conducted. The Seller has (and shall convey to the Purchaser at the
Closing) good title to or, in the case of leased property, valid leasehold
interests in, the Assets, free and clear of all Liens except Permitted
Liens.
Section
4.8
Inventory. The Seller’s inventory (a) was acquired
and is sufficient for the operation of the Business in the ordinary course
consistent with past practice, (b) is of a quality and quantity usable or
saleable in the ordinary course of business, and (c) is valued on the books
and
records of the Seller at the lower of cost or market with the cost determined
under the weighted average inventory valuation method consistent with past
practice.
Section
4.9 Financial
Statements. Schedule 4.9 contains true, correct and
complete copies of the Preliminary Financial Statements. The
Preliminary Financial Statements are in conformity with GAAP and have been
prepared from, and are in accordance with, the books and records of the Seller,
which books and records have been maintained on a basis consistent with the
past
practice of the Seller. Each balance sheet included in the
Preliminary Financial Statements (including the related notes and schedules)
is
true, correct and complete and fairly presents the financial position of
the
Seller as of the date of such balance sheet, and each statement of income
and
cash flows included in the Preliminary Financial Statements (including the
related notes and schedules) is true, correct and complete and fairly presents
the results of operations and changes in cash flows, as the case may be,
of the
Seller for the periods set forth therein.
On
or prior to the Closing Date, the Seller shall provide the Purchaser with
true,
correct and complete copies of the Audited Financial Statements. The
Audited Financial Statements will be in conformity with GAAP and will be
prepared from, and will be in accordance with, the books and records of the
Seller, which books and records have been maintained on a basis consistent
with
the past practice of the Seller. Each balance sheet included in the
Audited Financial Statements (including the related notes and schedules)
will be
true, correct and complete and fairly presents the financial position of
the
Seller as of the date of such balance sheet, and each statement of income
and
cash flows included in the Audited Financial Statements (including the related
notes and schedules) will be true, correct and complete and will fairly present
the results of operations and changes in cash flows, as the case may be,
of the
Seller for the periods set forth therein.
Since
December 31, 2006, there has been no change in any accounting (or tax
accounting) policy, practice or procedure of the Seller. The Seller
maintains accurate books and records reflecting its assets, liabilities,
revenues and expenses and maintains proper and adequate internal accounting
controls which provide assurance that (i) transactions are executed in
accordance with management’s authorization, (ii) transactions are recorded
as necessary to
permit
preparation of financial statements in conformity with GAAP, and
(iii) accounts, notes and other receivables and inventory are recorded
accurately, and proper and adequate procedures are implemented to effect
the
collection thereof on a current and timely basis.
Section
4.10 No
Undisclosed Liabilities. There are no liabilities of the Seller
of any kind whatsoever, whether accrued, contingent, absolute or otherwise,
and
whether known or unknown, except for:
(a) liabilities
and obligations fully reflected or provided for in the Preliminary Financial
Statements or the Audited Financial Statements;
(b) liabilities
and obligations incurred in the ordinary course of business, consistent with
past practice, since December 31, 2006; and
(c) liabilities
and obligations under Contracts that are not (i) attributable to any failure
by
the Seller to comply with the terms thereof or any express or implied warranty,
or (ii) entered into in violation of this Agreement.
Section
4.11 Absence of
Certain Changes. Since December 31, 2006, there has not been
(a) any Material Adverse Effect, (b) any damage, destruction, loss or
casualty to property or assets of the Seller (including the Assets) with
a value
in excess of $10,000, whether or not covered by insurance, (c) any sale,
transfer or disposition of any properties or assets, other than sales of
inventory in the ordinary course of business, consistent with past practice
or
(d) any action taken of the type described in Section 7.1 that, had such
action occurred following the date hereof without the Purchaser’s prior
approval, would be in violation of such Section 7.1.
Section
4.12 Legal
Proceedings. Except as set forth on Schedule 4.12, there
is no suit, action, claim, arbitration, proceeding or investigation pending
or,
to the Knowledge of the Seller, threatened against the Seller, or the Assets
before any Governmental Entity. No suit, action, claim, proceeding or
investigation pending or, to the Knowledge of the Seller, threatened against
the
Seller or the Assets before any Governmental Entity (including any of those
set
forth on Schedule 4.12), if finally determined adversely, is reasonably
likely, individually or in the aggregate, to have a Material Adverse
Effect. The Seller is not subject to any judgment, decree,
injunction, rule or order of any court or arbitration panel.
Section
4.13 Compliance
with Law. The Seller is (and has been at all times since Seller’s
inception) in compliance with all applicable Laws (including applicable Laws
relating to zoning and the safety and health of employees). The
Seller (a) has not been charged with, and the Seller has not received any
written notice that it is under investigation with respect to, and, to the
Knowledge of the Seller, is not otherwise now under investigation with respect
to, a violation of any applicable Law, (b) is not a party to, or bound by,
any order, judgment, decree, injunction, rule or award of any Governmental
Entity and (c) has filed all reports and has all Licenses required to be
filed
with any Governmental Entity on or prior to the date hereof.
Section
4.14 Contracts. True,
correct and complete copies of all Assumed Contracts have been provided to
the
Purchaser. The Assumed Contracts are legal, valid, binding and
enforceable in accordance with their respective terms with respect to the
Seller
and, to the Knowledge of the Seller, each other party thereto. There
is no existing default or breach of the
Seller
under any Assumed Contract (or event or condition that, with notice or lapse
of
time or both could constitute a default or breach) and, to the Knowledge
of the
Seller, there is no such default (or event or condition that, with notice
or
lapse of time or both, could constitute a default or breach) with respect
to any
third party to any Assumed Contract. There is no term, obligation,
understanding or agreement that would modify any term of an Assumed Contract
or
any right or obligation of a party thereunder which is not reflected on the
face
of such Assumed Contract. The Seller is not participating in any
discussions or negotiations regarding modification of or amendment to any
Assumed Contract or entry in any new Contract.
Section
4.15 Tax Returns;
Taxes.
(a) All
Tax Returns due to have been filed by the Seller through the date hereof
in
accordance with all applicable Laws (pursuant to an extension of time or
otherwise) have been duly filed and are true, correct and complete in all
respects. All Taxes, deposits and other payments for which the Seller
has liability (whether or not shown on any Tax Return) have been paid in
full or
are accrued as liabilities for Taxes on the books and records of the
Seller.
(b) The
amounts so paid, together with all amounts accrued as liabilities for Taxes
(including Taxes accrued as currently payable but excluding any accrual to
reflect timing differences between book and Tax income) on the books of the
Seller, shall be adequate based on the tax rates and applicable Laws in effect
to satisfy all liabilities for Taxes of the Seller in any jurisdiction through
the Closing Date, including Taxes accruable upon income earned through the
Closing Date.
(c) No
claims have been asserted and no proposals or deficiencies for any Taxes
of the
Seller are being asserted, proposed or, to the Knowledge of the Seller,
threatened, and no audit or investigation of any Tax Return of the Seller
is
currently underway, pending or threatened.
(d) No
claim has ever been made against the Seller by any Governmental Entity in
a
jurisdiction where the Seller does not file Tax Returns that the Seller is
or
may be subject to taxation in such jurisdiction.
(e) There
are no Liens for Taxes with respect to the Seller or the Assets, nor is there
any such Lien that is pending or, to the Knowledge of the Seller,
threatened.
Section
4.16 Employees and
Independent Contractors. Schedule 4.16 contains a true,
correct and complete list of all of the employees (including the Paychex
Employees) currently employed by the Seller, specifying the name of the employee
and type of labor/title. All Persons classified by the Seller as
independent contractors have been properly classified in accordance with
all
applicable Laws. Each independent contractor and employee has the
requisite License required to provide the services such independent contractor
or employee provides the Seller, as applicable. Neither the Seller
nor the Members have received a claim from any Governmental Entity to the
effect
that the Seller has improperly classified any Person as an independent
contractor, nor to the Knowledge of the Seller has any such claim been
threatened. Neither the Seller nor the Members have made any verbal
commitments to any Person with respect to
compensation,
promotion, retention, termination, severance or similar matters in connection
with the transactions contemplated hereby or otherwise.
Section
4.17 Seller
Benefit Plans. Except for the benefits provided by Paychex with
respect to the Paychex Employees, the Seller does not have any Seller Benefit
Plans or ERISA Affiliate Plans. The Seller has not announced or
entered into any plan or binding commitment to adopt, create or cause to
exist
any Seller Benefit Plan.
Section
4.18 Labor
Relations.
(a) No
employee (including any Paychex Employee) currently used by the Company has
been, or currently is, represented by a labor organization or group that
was
either certified or voluntarily recognized by any labor relations board
(including the NLRB) or certified or voluntarily recognized by any other
Governmental Entity. The Seller is not and has never been a signatory
to a collective bargaining agreement with any trade union, labor organization
or
group.
(b) The
Seller is not and has not been engaged in any unfair labor practice and the
Seller is not aware of any pending or, to the Knowledge of the Seller,
threatened labor board proceeding of any kind, including any such proceeding
against the Seller or any trade union, labor union, employee organization
or
labor organization representing the Seller’s employees. No labor
dispute, walk out, strike, slowdown, hand billing, picketing, work stoppage
(sympathetic or otherwise), or other “concerted action” involving the employees
of the Seller has occurred, is in progress or, to the Knowledge of the Seller,
has been threatened. The Seller is in compliance with all Labor Laws
and is not liable for any liability, judgment, decree, order, arrearage of
wages
or taxes, fine or penalty for failure to comply with any Labor
Law. No citation has been issued by OSHA against the Seller and no
notice of contest, claim, complaint, charge, investigation, or other
administrative enforcement proceeding involving the Seller has been filed
or is
pending or, to the Knowledge of the Seller, threatened against the Seller
under
the Laws administered or enforced by OSHA or any other applicable Law relating
to occupational safety and health. No workers’ compensation or
retaliation claim, complaint, charge or investigation has been filed or is
pending against the Seller.
(c) The
Seller has maintained and currently maintains adequate insurance as required
by
applicable Law with respect to workers’ compensation claims and unemployment
benefits claims.
Section
4.19 Insurance
Policies. Schedule 4.19 contains a true, correct and
complete list of all insurance policies carried by or for the benefit of
the
Seller, specifying the insurer, the amount of and nature of coverage, the
risk
insured against, the deductible amount (if any) and the date through which
coverage shall continue by virtue of premiums already paid. The
Seller maintains sufficient insurance with reputable insurers for the business
and assets of the Seller against all risks normally insured against, and
in
amounts normally carried, by the Seller consistent with past
practice. All insurance policies and bonds with respect to the
business and assets of the Seller are in full force and effect and shall
be
maintained by the Seller in full force and effect as they apply to any matter,
action or event relating to the Seller occurring through the
Closing
Date and the Seller has not reached or exceeded its policy limits for any
insurance policy in effect at any time during the past five (5)
years.
Section
4.20 Environmental,
Health and Safety Matters.
(a) The
Seller possesses all Licenses required under, and is in full compliance with,
all Environmental Laws, and the Seller is in compliance with all applicable
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in all Environmental Laws
or
contained in any other Law, or any notice or demand letter issued
thereunder.
(b) No
portion of the Real Property has been used as a landfill or waste disposal
site. None of the buildings and improvements owned or utilized by the
Seller is constructed of, or contains as a component part thereof, any material
that, either in its present form or as such material could reasonably be
expected to change through aging and normal use and service, releases any
substance, whether gaseous, liquid or solid, that is or may be, either in
a
single dose or through repeated and prolonged exposure, injurious or hazardous
to the health of any individual who may from time to time be in or about
such
buildings or improvements.
(c) The
Seller has not received notice of actual or threatened liability under CERCLA
or
any similar foreign, state or local Law from any Governmental Entity or any
third party and there is no fact or circumstance (including, without limitation,
the management, handling or Release of Hazardous Materials) that could form
the
basis for the assertion of any claim against the Seller under any Environmental
Law, including CERCLA or any similar local, state or foreign Law with respect
to
any on-site or off-site location.
(d) The
Seller has provided to the Purchaser true, correct and complete copies of
any
and all audits conducted regarding any environmental or health and safety
matter
related to the Real Property. For purposes of this Section 4.20(d),
an “audit” means any inspection, investigation, assessment, study or test
performed at the request of, or on the behalf of, a Governmental
Entity. The Seller has provided to the Purchaser true, correct and
complete copies of all reports, correspondence, memoranda, computer data
and the
complete files relating to environmental matters; and the Seller has not
paid
any fine, penalty or assessment within the prior five (5) years with respect
to
environmental matters.
(e) No
improvement or equipment included in the Assets contains any asbestos,
polychlorinated biphenyls, underground storage tanks, open or closed pits,
sumps
or other containers on or under any Asset. The Seller has not
imported, received, manufactured, produced, processed, labeled, or shipped,
stored, used, operated, transported, treated or disposed of any Hazardous
Material other than in compliance with all Environmental Laws.
Section
4.21 Intellectual
Property.
(a) The
Seller does not have any Seller Registered Intellectual Property.
(b) The
Seller owns and has good and exclusive title to, or has licenses (sufficient
for
the conduct of its business as currently conducted) to, each item of Seller
Intellectual Property, free and clear of any Lien (excluding licenses and
related restrictions); the Seller is the exclusive owner or exclusive licensee
of all trademarks and service marks, trade names and domain names used in
connection with the operation or conduct of the Business, including the sale
of
any products or the provision of any services by the Seller, free and clear
of
all Liens; and the Seller’s licensing of any of its trademarks and service marks
has been subject to commercially reasonable quality control of the Seller
and
the Seller has exercised such quality control in a consistent and commercially
reasonable manner.
(c) The
operation of the Business as it is currently conducted, including the design,
development, marketing and sale of the products or services (including products
currently under development), has not and does not infringe or misappropriate
in
any manner the Intellectual Property of any third party or, to the Knowledge
of
the Seller, constitute unfair competition or trade practices under the Laws
of
any jurisdiction. To the Knowledge of the Seller, no Person has or is
infringing or misappropriating any Seller Intellectual Property.
(d) The
Seller has taken reasonable steps to protect the rights of the Seller in
the any
trade secret or confidential information of third parties used by the Seller,
and, except under confidentiality obligations, there has not been any disclosure
by the Seller of any such trade secret or confidential information of third
parties.
Section
4.22 Software. The
Seller does not own any Software. The Seller is in compliance in all
respects with the terms and conditions of all Contracts in favor of the Seller
relating to the Seller Software.
Section
4.23 Affiliate
Matters. Except as set forth on Schedule 4.23, no (a)
Member or officer or director of the Seller, (b) Person with whom any such
Member, officer or director has any direct or indirect relation by blood,
marriage or adoption, or (c) Affiliate of any of the foregoing, or
(e) current or former Affiliate of the Seller, has any interest in or is
a party
to: (i) any Contract with, or relating to the Seller, the Business, the
Assets or the Assumed Liabilities; (ii) any loan for or relating to the Seller,
the Business or the Assets; or (iii) any property (real, personal or mixed,
tangible or intangible) used or currently intended to be used by the
Seller. Schedule 4.23 also sets forth a true, correct and
complete list of all accounts receivable, notes receivable and other receivables
and accounts payable owed to or due from any such Person described above
by or
to the Seller.
Section
4.24 Customer
and Supplier Relations. Schedule 4.24(1) contains a true,
correct and complete list of the names and addresses of the current customers
of
the Seller (the “Customers”). Schedule 4.24(2) contains
a true, correct and complete list of the names and addresses of the current
suppliers of the Seller (the “Suppliers”). The Seller
maintains good
commercial
relations with each of its Customers and Suppliers and, to the Knowledge
of the
Seller, no event has occurred that could materially and adversely affect
the
Seller’s relations with any such Customer or Supplier. The Seller has
not received any notice and does not have any Knowledge to the effect that
any
current customer or supplier may terminate or materially alter its business
relations with the Seller, either as a result of the transactions contemplated
hereby or otherwise. All accounts receivable of the Seller (i) are
valid, existing and collectible in a manner consistent with the Seller’s past
practice without resort to legal proceedings or collection agencies,
(ii) represent monies due for goods sold and delivered or services rendered
in the ordinary course of business and (iii) are not subject to any refund
or
adjustment or any defense, right of set-off, assignment, restriction, security
interest or other Lien.
Section
4.25 Licenses. Schedule
4.25 is a true, correct and complete list of all Licenses held by the Seller
for use in the Business. The Seller owns or possesses all Licenses
that are necessary to enable it to carry on the Business as presently conducted
and as presently planned to be conducted. All Licenses are valid,
binding and in full force and effect. The Seller has taken all
necessary action to maintain each License, except where the failure to so
act
shall not have an adverse effect on the Seller or the Business. No
loss or expiration of any License is pending or, to the Knowledge of the
Seller,
threatened (other than expiration upon the end of any
term). Schedule 4.25 identifies with an asterisk each License
set forth therein which by its terms cannot be transferred to the Purchaser
at
Closing.
Section
4.26 Product and
Service Warranties. The Seller does not make any warranty or
guaranty as to goods manufactured, sold, leased, licensed or delivered or
services provided by the Seller, and there is no pending or, to the Knowledge
of
the Seller, threatened claim alleging any breach of any such warranty or
guaranty.
Section
4.27 Brokers,
Finders and Investment Bankers. Neither the Seller, nor any
officer, member, director or employee of the Seller, nor any Affiliate of
the
Seller, nor any Member has employed any broker, finder or investment banker
or
incurred any liability for any investment banking fees, financial advisory
fees,
brokerage fees or finders’ fees in connection with the transactions contemplated
hereby.
Section
4.28
Disclosure. No representations, warranties, assurances or
statements by any Member or the Seller in this Agreement and no statement
contained in any document (including the Preliminary Financial Statements,
Audited Financial Statements and the schedules and exhibits to this Agreement),
certificates or other writings furnished or to be furnished by any Member
or the
Seller (or caused to be furnished by any Member or the Seller) to the Purchaser
or any of its representatives pursuant to the provisions hereof contains
or will
contain any untrue statement of material fact, or omits or will omit to state
any fact necessary, in light of the circumstances under which it was made,
in
order to make the statements herein or therein not misleading.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES OF THE MEMBERS
Each
Member severally, and not jointly, represents and warrants to the Purchaser
as
follows, as of the date hereof and as of the Closing Date:
Section
5.1
Authorization and Validity of Agreement. Such Member has the
legal right, power and capacity to execute and deliver this Agreement and
the
Seller Ancillary Documents to which it is a party and to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated
hereby
and thereby. This Agreement has been, and the Seller Ancillary
Documents to which it is a party shall be as of the Closing Date, duly and
validly executed and delivered by such Member and do or shall, as the case
may
be, constitute the valid and binding agreements of such Member, enforceable
against such Member in accordance with their respective terms.
Section
5.2 Absence
of Restrictions and Conflicts. The execution, delivery and
performance by such Member of this Agreement and the Seller Ancillary Documents
to which it is a party, the consummation of the transactions contemplated
hereby
and thereby and the fulfillment of and compliance with the terms and conditions
hereof and thereof do not or shall not (as the case may be), with the passing
of
time or the giving of notice or both, (a) violate or conflict with, constitute
a
breach of or default under, result in the loss of any benefit under, permit
the
acceleration of any obligation under or create in any party the right to
terminate, modify or cancel any Contract to which such Member is a party,
(b)
contravene or conflict with any judgment, decree or order of any Governmental
Entity to which such Member is a party or by which such Member is bound,
or (c)
contravene or conflict with any Law or arbitration award applicable to such
Member.
Section
5.3 Legal
Proceedings. There are no suits, actions, claims, proceedings or
investigations pending or, to the knowledge of such Member, threatened against,
relating to or involving such Member that could adversely affect such Member’s
ability to consummate the transactions contemplated by this
Agreement.
Section
5.4 Investment
Representations.
(a) No
Member is acquiring shares of Parent Stock with any present intention of
distributing or selling such shares in violation of federal, state or other
securities laws. Each Member agrees that it will not sell, transfer,
offer for sale, pledge, hypothecate or otherwise dispose of the shares of
Parent
Stock in violation of any federal, state or other securities
law. Each Member acknowledges that the Parent Stock is subject to
market and other conditions beyond the control of the Purchaser.
(b) Reliance
upon Members’ Representations. Each Member understands that the
Parent Stock is being offered and sold to it in reliance on specific exemptions
from the registration requirements of the United States federal securities
laws
and that the Purchaser is relying on the truth and accuracy of, and each
Member’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Members set forth herein in order
to
determine the availability of such exemptions and the eligibility of each
Member
to acquire the Parent Stock.
(c) Restricted
Securities. Each Member agrees and acknowledges that the
Purchaser Stock to be received by such Member pursuant to this Agreement
may not
be sold, transferred or otherwise disposed of without registration under
the
Securities Act of 1933 (the “Securities Act”) or an exemption therefrom,
and that in the absence of an
effective
registration statement covering the Parent Stock or an available exemption
from
registration under the Securities Act, the Parent Stock must be held
indefinitely. In particular, each Member is aware that the Parent
Stock may not be sold pursuant to Rule 144 promulgated under the Securities
Act
unless all of the conditions of that Rule are met. Among the
conditions for use of Rule 144 may be the availability of current information
to
the public about the Purchaser.
(d) Experience. Each
Member represents that it is experienced in evaluating and can bear the economic
risk of investment in securities which are not registered under the Securities
Act, and has such knowledge and experience in financial and business matters
that such Member is capable of evaluating the merits and risks of an investment
in the Parent Stock.
(e) Access
to Information. Each Member agrees and acknowledges that it has
had access to such information regarding the Purchaser as it deems necessary
for
it to make an informed decision regarding the investment in the
Purchaser.
ARTICLE
VI
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
The
Purchaser hereby represents and warrants to the Seller and each of the Members
as follows as of the date hereof and the Closing Date:
Section
6.1
Organization. The Purchaser is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Georgia and has all requisite corporate power and authority to own,
lease and operate its properties and to carry on the Business as now being
conducted.
Section
6.2 Authorization. The
Purchaser has full corporate power and authority to execute and deliver this
Agreement and the Purchaser Ancillary Documents, to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated
hereby
and thereby. The execution and delivery of this Agreement and the
Purchaser Ancillary Documents by the Purchaser, the performance by the Purchaser
of its obligations hereunder and thereunder, and the consummation of the
transactions provided for herein and therein have been duly and validly
authorized by all necessary corporate action on the part of the
Purchaser. This Agreement has been and, as of the Closing Date, the
Purchaser Ancillary Documents shall be, duly executed and delivered by the
Purchaser and do or shall, as the case may be, constitute the valid and binding
agreements of the Purchaser, enforceable against the Purchaser in accordance
with their respective terms.
Section
6.3
Absence of Restrictions and Conflicts. The execution, delivery
and performance of this Agreement and the Purchaser Ancillary Documents,
the
consummation of the transactions contemplated hereby and thereby and the
fulfillment of, and compliance with, the terms and conditions hereof and
thereof
do not or shall not (as the case may be), with the passing of time or the
giving
of notice or both, (a) contravene or conflict with any term or provision of
the charter documents of the Purchaser, (b) violate or conflict with,
constitute a breach of or default under, result in the loss of any benefit
under, permit the acceleration of any
obligation
under or create in any party the right to terminate, modify or cancel any
Contract to which the Purchaser is a party, (c) contravene or conflict with
any judgment, decree or order of any Governmental Entity to which the Purchaser
is a party or by which the Purchaser is bound or (d) contravene or conflict
with any statute, Law, rule or regulation applicable to the
Purchaser. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is required
with respect to the Purchaser in connection with the execution, delivery
or
performance of this Agreement or the Purchaser Ancillary Documents or the
consummation of the transactions contemplated hereby or thereby.
ARTICLE
VII
CERTAIN
COVENANTS AND AGREEMENTS
Section
7.1 Conduct
of Business by the Seller. Except as expressly permitted by this
Agreement or Schedule 7.1 or as required by applicable Law, during the
period commencing on the date hereof and ending on the Closing Date, unless
the
Purchaser otherwise consents, the Seller shall (and the Members will cause
the
Seller to) conduct the Business in the ordinary course, consistent with past
practice and shall:
(a) use
its commercially reasonable efforts to preserve intact the goodwill and business
organization of the Seller, keep the officers and employees of the Seller
available to the Purchaser and preserve the relationships and goodwill of
the
Seller with customers, distributors, suppliers, employees and other Persons
having business relations with the Seller;
(b) maintain
its existence and good standing in its jurisdiction of organization and in
each
jurisdiction listed on Schedule 4.1(b);
(c) comply
with all applicable Laws;
(d) maintain
in existing condition and repair (ordinary wear and tear excepted), consistent
with past practices, all equipment, fixtures and other tangible personal
property located on the Real Property;
(e) not
authorize for issuance or issue and deliver any additional membership interests
or securities convertible into or exchangeable for membership interests,
or
issue or grant any right, option or other commitment for the issuance of
membership interests;
(f) not
amend or modify its articles of organization or operating
agreement;
(g) not
declare any dividend, pay or set aside for payment any dividend or other
distribution or make any payment to any Member, officer or director or any
Person with whom any such Member or manager has any direct or indirect relation,
other than the payment of salaries in the ordinary course of business and
consistent with past practice;
(h) not
(i) create, incur or assume any indebtedness secured by the Assets,
(ii) grant, create, incur or suffer to exist any Lien on the Assets that
did not exist on the date hereof, (iii) write-down the value of any asset
or
investment (including any Asset)
on
the
books or records of the Seller, except for depreciation and amortization
in the
ordinary course of business and consistent with past practice, (iv) cancel
any
debt or waive any claim or right, (v) make any commitment for any capital
expenditure to be made on or following the date hereof, (vi) enter into any
Contract which cannot be cancelled by the Seller on notice of not longer
than
thirty (30) days and without liability or penalty of any kind, (vii) enter
into
any Contract which imposes, or purports to impose, any obligations or
restrictions on any of its Affiliates, or (viii) settle or compromise any
legal
proceedings related to or in connection with the Seller’s business;
(i) not
increase in any manner the compensation of, or enter into any new bonus or
incentive agreement or arrangement with, any of its employees, officers,
directors or consultants, except in the ordinary course of business to the
extent consistent with past practice of the Seller;
(j) not
enter into any Employment Agreement;
(k) perform
in all material respects all of its obligations under all Assumed Contracts
and
Licenses, and not default or suffer to exist any event or condition that
with
notice or lapse of time or both could constitute a default under any Assumed
Contract or License (except those being contested in good faith);
(l) continue
to maintain its books and records in accordance with GAAP consistently applied
and on a basis consistent with past practice and not make any change in any
of
its accounting (or tax accounting) policies, practices or
procedures;
(m) continue
its current cash and inventory management practices in the ordinary course
of
business consistent with past practice; and
(n) not
authorize, or commit or agree to take, any of the foregoing
actions.
Section
7.2 Notices
of Certain Events. The Seller shall promptly notify the Purchaser
of:
(a) any
fact, condition, change or event that, individually or in the aggregate,
has had
or could reasonably be expected to have a Material Adverse Effect or otherwise
results in any representation or warranty of the Seller or the Members hereunder
being inaccurate in any respect as of the date of such fact, condition, change
or event had such representation or warranty been made as of such
date;
(b) any
fact, condition, change or event that causes or constitutes a breach of any
of
the representations or warranties of the Seller or the Members hereunder
made as
of the date hereof;
(c) any
notice or other communication from any Person alleging that the consent of
such
Person is or may be required in connection with the transactions contemplated
hereby;
(d) any
action, suit, claim, investigation or proceeding commenced or, to the Knowledge
of the Seller, threatened against, relating to or involving or otherwise
affecting the Seller that, if pending on the date hereof, would have been
required to have been disclosed pursuant to Section 4.12 or that relate to
the
consummation of the transactions contemplated hereby; and
(e) (i)
the damage or destruction by fire or other casualty of any Asset or part
thereof
or (ii) any Asset or part thereof becoming the subject of any proceeding
(or, to
the Knowledge of the Seller, threatened proceeding) for the taking thereof
or of
any right relating thereto by condemnation, eminent domain or other similar
governmental action.
The
Seller and the Members hereby acknowledge that the Purchaser does not and
shall
not waive any right it may have hereunder solely as a result of such
notifications and any notification given pursuant to this Section 7.2 (including
any supplement to the schedules to this Agreement) shall (x) not have any
effect
for purposes of determining satisfaction of the conditions set forth in Section
8.1 of this Agreement, (y) be disregarded for purposes of determining the
obligations of the Seller under Article XI hereof, and (z) not in any way
limit
the Purchaser’s exercise of its rights hereunder.
Section
7.3 No
Solicitation of Transactions. Until the earlier of the Closing or
the termination of this Agreement pursuant to Article X, neither the Seller
nor
any of the Members shall, directly or indirectly, through any officer, director,
manager or agent of any of them or otherwise, initiate, solicit or encourage
(including by way of furnishing non-public information or assistance), or
enter
into negotiations of any type, directly or indirectly, or enter into a
confidentiality agreement, letter of intent or other similar Contract with
any
Person other than the Purchaser with respect to a sale of all or any substantial
portion of the Assets, or a merger, consolidation, business combination,
sale of
all or any substantial portion of the capital stock of the Seller, or the
liquidation or similar extraordinary transaction with respect to the Seller
(an
“Acquisition Transaction”). The Seller shall notify the
Purchaser orally (within two (2) Business Days) and in writing (as promptly
as
practicable) of all relevant terms of any inquiry or proposal by a third
party
to do any of the foregoing that the Seller or any of the Members or any of
their
respective officers, directors, partners, managers, employees, investment
bankers, financial advisors, attorneys, accountants or other representatives
may
receive relating to any of such matters. In the event such inquiry or
proposal is in writing, the Seller shall deliver to the Purchaser a copy
of such
inquiry or proposal together with such written notice.
Section
7.4 Reasonable
Efforts; Further Assurances; Cooperation. Subject to the other
provisions hereof, each Party shall use its reasonable, good faith efforts
to
perform its obligations hereunder and to take, or cause to be taken, and
do, or
cause to be done, all things necessary, proper or advisable under applicable
Law
to cause the transactions contemplated herein to be effected as soon as
practicable, but in any event on or prior to the Expiration Date, in accordance
with the terms hereof and shall cooperate fully with each other Party and
its
officers, directors, employees, agents, counsel, accountants and other designees
in connection with any step required to be taken as a part of its obligations
hereunder, including the following:
Section
7.5 Consents. The
Members and the Seller shall, during the remaining term of each Non-Assignable
Contract, use commercially reasonable efforts to (a) obtain the consent
of
the
third
parties required thereunder, (b) make the benefit of such Non-Assignable
Contract available to the Purchaser so long as the Purchaser fully cooperates
with the Seller and promptly reimburses the Seller for all payments made
by the
Seller (with the prior approval of the Purchaser) in connection therewith
and
(c) enforce, at the request of the Purchaser and at the sole expense and
for the
account of the Purchaser, any right of the Seller arising from such
Non-Assignable Contract against the other party or parties thereto (including
the right to elect or terminate any such Non-Assignable Contract in accordance
with the terms thereof). The Seller shall not take any action or
suffer any omission that could limit, restrict or terminate in any material
respect the benefits to the Purchaser of such Non-Assignable Contract unless,
in
good faith and after consultation with and prior written notice to the
Purchaser, the Seller is (i) ordered to do so by a Governmental Entity of
competent jurisdiction or (ii) otherwise required to do so by Law; provided,
however, that if any such order is appealable, the Seller shall, at the
Purchaser’s sole cost and expense, take such reasonable actions as are requested
by the Purchaser to file and pursue such appeal and to obtain a stay of such
order. Nothing in this Agreement or the Assumption Agreement shall
constitute a sale, assignment, transfer or conveyance to, or assumption by,
the
Purchaser of the Non-Assignable Contracts. With respect to any such
Non-Assignable Contract as to which the necessary approval or consent for
the
assignment or transfer to the Purchaser is obtained following the Closing,
the
Seller shall transfer such Non-Assignable Contract to the Purchaser by execution
and delivery of an instrument of conveyance reasonably satisfactory to the
Purchaser within five (5) Business Days following receipt of such approval
or
consent.
Section
7.6 Transfer
Taxes; Expenses. Any Taxes or recording fees payable as a result
of the purchase and sale of the Assets or any other action contemplated hereby
(other than any federal, state, local or foreign Taxes measured by or based
upon
income or gains imposed upon the Purchaser) shall be paid by the
Seller. The Parties shall cooperate in the preparation, execution and
filing of all returns, questionnaires, applications and other documents
regarding Taxes and all transfer, recording, registration and other fees
that
become payable in connection with the transactions contemplated hereby that
are
required or permitted to be filed at or prior to the
Closing.
Section
7.7 Insurance. If
requested by the Purchaser, each of the Seller and the Members shall in good
faith cooperate with the Purchaser and take all actions reasonably requested
by
the Purchaser that are necessary or desirable to permit the Purchaser to
have
available to it following the Closing the benefits (whether direct or indirect)
of the insurance policies maintained by or on behalf of the Seller that are
currently in force. All costs relating to the actions described in
this Section 7.7 shall be borne solely by the Purchaser.
Section
7.8 Receivables. From
and after the Closing, if the Seller or any Member receives or collects any
Receivables, the Seller or Member, as applicable, shall remit any such amounts
to the Purchaser within five (5) days of each day on which the Seller or
Member,
as applicable, receives such sum.
Section
7.9 Risk
of Loss. The risk of loss with respect to the Assets shall remain
with the Seller until the Closing. Until the Closing, the Seller
shall maintain in force all the policies of property damage insurance under
which any Asset is insured. In the event prior to the
Closing
any
material Asset is lost, damaged, destroyed or taken or threatened to be taken
by
the exercise of the right of eminent domain, then:
(a) the
Purchaser may terminate this Agreement in accordance with the provisions
of
Section 10.1(d); or
(b) the
Purchaser may require the Seller to assign to the Purchaser the proceeds
of any
insurance payable as a result of the occurrence of such loss, damage or
destruction and to reduce the Purchase Price by the amount of the replacement
cost of the Assets that were lost, damaged, destroyed or taken or threatened
to
be taken by the exercise of the right of eminent domain, less the amount
of any
proceeds of insurance payable as a result of the occurrence.
ARTICLE
VIII
CONDITIONS
TO CLOSING
Section
8.1 Conditions
to Obligations of the Purchaser. The obligations of the Purchaser
to consummate the transactions contemplated hereby shall be subject to the
fulfillment (or waiver by the Purchaser) at or prior to the Closing
of each of the following additional conditions:
(a) Injunction.
There shall be no effective injunction, writ or preliminary restraining order
or
any order of any nature issued or Law passed by a Governmental Entity of
competent jurisdiction to the effect that the transactions contemplated hereby
may not be consummated as provided herein, no proceeding or lawsuit shall
have
been commenced by any Governmental Entity for the purpose of obtaining any
such
injunction, writ or preliminary restraining order and no written notice shall
have been received from any Governmental Entity indicating an intent to
restrain, prevent, materially delay or restructure the transactions contemplated
hereby, in each case where the Closing would (or would be reasonably likely
to)
result in a material fine or penalty payable by the Purchaser or a material
restriction on the Purchaser’s operation of its business as a result of such
matter.
(b) Consents.
All consents set forth on Exhibit 8.1(b) shall have been obtained or made
on terms and conditions reasonably satisfactory to the Purchaser.
(c) Representations
and Warranties. Each of the representations and warranties of the
Seller and the Members set forth in Article IV and of the Members contained
in
Article V shall have been true and correct in all material respects as of
the
date hereof and shall be true and correct in all material respects as of
the
Closing Date as though made on and as of the Closing Date, except that those
representations and warranties that by their terms are qualified by materiality
shall be true and correct in all respects.
(d) Performance
of Obligations of the Seller and the Members. The Seller and each
of the Members shall have performed in all material respects all covenants
and
agreements required to be performed by it hereunder at or prior to the
Closing.
(e) No
Material Adverse Effect. Between the date hereof and the Closing
Date, there shall not have occurred (nor shall the Purchaser have become
aware
of) any Material Adverse Effect or any development reasonably likely to result
in a Material Adverse Effect.
(f) Release
of Liens. The Purchaser shall have received evidence reasonably
satisfactory to it that all Liens affecting any Asset (other than Permitted
Liens) have been released, or will be released upon repayment of the Closing
Date Indebtedness pursuant hereto.
(g) Audited
Financial Statements. The Seller shall have delivered to the
Purchaser the Audited Financial Statements in accordance with Section
4.9.
(h) Owned
Real Property. The Purchaser shall have obtained a title
insurance policy showing that the Purchaser has good, valid and marketable
title
in fee simple absolute to all the Owned Real Property, free and clear of
all
title defects or Liens other than Permitted Liens, and containing a
non-imputation endorsement to the effect that any knowledge of title defects
on
the part of the Members or the Seller on or prior to the Closing will not
be
attributed to the Purchaser. The Seller and the Purchaser shall have
prepared for execution all documentation and other information necessary
to
consummate the transfer of the Owned Real Property at the Closing, including
without limitation, the receipt of any affidavits or indemnities required
by a
title company in connection with the receipt of a title insurance policy
with
respect to the Owned Real Property. The Purchaser shall have received
an executed deed with respect to the Owned Real Property.
(i)
Ancillary Documents. The Seller shall have
delivered, or caused to be delivered, to the Purchaser the documents listed
in
Section 9.2.
Section
8.2 Conditions
to Obligations of the Seller and the Members. The obligations of
the Seller and the Members to consummate the transactions contemplated hereby
shall be subject to the fulfillment (or waiver by the Seller) at or prior
to the
Closing of each of the following additional conditions:
(a) Injunction. There
shall be no effective injunction, writ or preliminary restraining order or
any
order of any nature issued by a Governmental Entity of competent jurisdiction
to
the effect that the transactions contemplated hereby may not be consummated
as
provided herein, no proceeding or lawsuit shall have been commenced by any
Governmental Entity for the purpose of obtaining any such injunction, writ
or
preliminary restraining order and no written notice shall have been received
from any Governmental Entity indicating an intent to restrain, prevent,
materially delay or restructure the transactions contemplated hereby, in
each
case where the Closing would (or would be reasonably likely to) result in
a
material fine or penalty payable by the Seller.
(b) Representations
and Warranties. Each of the representations and warranties of the
Purchaser set forth in Article VI shall have been true and correct in all
material respects as of the date hereof and shall be true
and correct in all material respects
as
of the
Closing Date as though made on and as of the Closing Date, except that those
representations and warranties that by their terms are qualified by materiality
shall be true and correct in all respects.
(c) Performance
of Obligations by the Purchaser. The Purchaser shall have
performed in all material respects all covenants and agreements required
to be
performed by it hereunder on or prior to the Closing Date.
(d) Ancillary
Documents. The Purchaser shall have delivered, or caused to be
delivered, to the Seller the documents listed in Section 9.3.
ARTICLE
IX
CLOSING
Section
9.1 Closing. Subject
to the satisfaction or waiver of the conditions set forth in Article VIII,
the
Closing shall occur no later than five (5) Business Days following the date
when
all of the conditions set forth in Article VIII hereof have been satisfied
or
otherwise waived by the appropriate Party, or such other date as the Parties
may
agree. The Closing shall take place at the offices of Paul, Hastings,
Xxxxxxxx & Xxxxxx LLP, 600 Xxxxxxxxx Xxxxxx, XX, Xxxxx 0000, Xxxxxxx,
Xxxxxxx 00000, or at such other place as the Parties may agree.
Section
9.2 Seller
Closing Deliveries. At the Closing, the Seller and the Members,
as applicable, shall deliver to the Purchaser the following:
(a) a
certificate or certificates executed by the Members and the Manager of the
Seller as to compliance with the conditions set forth in Section 8.1(c),
(d) and
(e) hereof;
(b) executed
bills of sale, instruments of assignment, certificates of title documents,
deeds
and other conveyance documents, dated as of the Closing Date, transferring
to
the Purchaser all of the Seller’s right, title and interest in and to the
Assets, together with possession of the Assets, including the Xxxx of Sale
substantially in the form of Exhibit 9.2(b) (the “Xxxx of
Sale”);
(c) documents
evidencing the assumption of the Assumed Liabilities, including the Assumption
Agreement substantially in the form of Exhibit 9.2(c) (the “Assumption
Agreement”).
(d) a
certificate of non-foreign status that complies with Treasury Regulation
Section
1.1445-2(b)(2);
(e) a
certificate by the Manager of the Seller, dated the Closing Date, as to
(1) the good standing of the Seller in its jurisdiction of organization and
in each other jurisdiction where it is qualified to do business, (2) the
completeness of the Seller’s articles of organization and operating agreement
and (3) the effectiveness of the resolutions of the Members of the Seller
authorizing the execution, delivery and performance hereof by the Seller
passed
in connection herewith and the transactions contemplated hereby;
and
(f) all
other documents required to be entered into by the Seller and the Members
pursuant hereto or reasonably requested by the Purchaser to convey the Assets
to
the Purchaser or to otherwise consummate the transactions contemplated
hereby.
Section
9.3 Purchaser
Closing Deliveries. On the Closing, the Purchaser shall deliver,
or caused to be delivered, to the Seller the following:
(a) the
Purchase Price in accordance with Section 3.2.
(b) a
certificate of an authorized officer as to compliance with the conditions
set
forth in Section 8.2(b) and (c);
(c) the
Assumption Agreement; and
(d) all
other documents required to be entered into or delivered by the Purchaser
at or
prior to the Closing pursuant hereto.
ARTICLE
X
TERMINATION
Section
10.1 Termination. This
Agreement may be terminated:
(a) in
writing by mutual consent of the Purchaser and the Seller;
(b) by
written notice from the Seller to the Purchaser, in the event the Purchaser
(i)
fails to perform in any material respect any of its agreements contained
herein
required to be performed by it at or prior to the Closing or (ii) materially
breaches any of its representations and warranties contained herein, which
failure or breach is not cured within ten (10) days following the Seller
having
notified the Purchaser of its intent to terminate this Agreement pursuant
to
this Section 10.1(b);
(c) by
written notice from the Purchaser to the Seller, in the event the Seller
or the
Members (i) fails to perform in any material respect any of their agreements
contained herein required to be performed by it at or prior to the Closing
or
(ii) materially breaches any of their representations and warranties contained
herein, which failure or breach is not cured within ten (10) days following
the
Purchaser having notified the Seller of its intent to terminate this Agreement
pursuant to this Section 10.1(c);
(d) by
written notice from the Purchaser to the Seller under the circumstances
described in Section 7.9; or
(e) by
written notice by the Seller to the Purchaser or the Purchaser to the Seller,
as
the case may be, in the event the Closing has not occurred on or prior to
December 31, 2007 (the “Expiration Date”) for any reason other than delay
or nonperformance of the Party seeking such termination.
Section
10.2 Specific
Performance and Other Remedies. Each Party hereby acknowledges
that the rights of each Party to consummate the transactions contemplated
hereby
are
special, unique and of extraordinary character and that, in the event that
any
Party violates or fails or refuses to perform any covenant or agreement made
by
it herein, the non-breaching Party may be without an adequate remedy at
law. In the event that any Party violates or fails or refuses to
perform any covenant or agreement made by such Party herein, the non-breaching
Party or Parties may, subject to the terms hereof and in addition to any
remedy
at law for damages or other relief, institute and prosecute an action in
any
court of competent jurisdiction to enforce specific performance of such covenant
or agreement or seek any other equitable relief.
Section
10.3 Effect
of Termination. In the event of termination of this Agreement
pursuant to this Article X, this Agreement shall forthwith become void and
there
shall be no liability on the part of any Party or its partners, officers,
directors or stockholders, except for obligations under Section 10.2 (Specific
Performance and Other Remedies), Section 12.2 (Notices), Section 12.6
(Controlling Law), Section 12.7 (Severability), Section 12.9 (Enforcement
of
Certain Rights), Section 12.10 (Waiver; Amendment) and Section 12.15
(Transaction Costs) and this Section 10.3, all of which shall survive the
Termination Date. Notwithstanding the foregoing, nothing contained
herein shall relieve any Party from liability for any breach hereof.
ARTICLE
XI
INDEMNIFICATION
Section
11.1 Indemnification
Obligations of the Members. From and after the
Closing, the Seller and the Members (as a group) jointly
and severally, and the Members, severally but not jointly, shall indemnify,
defend and hold harmless the Purchaser Indemnified Parties from, against,
and in
respect of, any and all claims (including for diminution in value), liabilities,
obligations, damages, losses, costs, expenses, penalties, fines and judgments
(at equity or at law, including statutory and common) whenever arising or
incurred (including amounts paid in settlement, costs of investigation and
reasonable attorneys’ fees and expenses) arising out of or relating
to:
(a) any
liability or obligation of the Seller or the Members of any nature whatsoever
except the Assumed Liabilities;
(b) events
or circumstances occurring or existing with respect to the ownership, operation
and maintenance of the Seller’s business and the Assets on or prior to the
Closing Date, except the Assumed Liabilities;
(c) any
breach or inaccuracy of any representation or warranty made by the Seller
or the
Members in this Agreement (other than in Article V) or the Seller Ancillary
Documents, whether such representation or warranty is made as of the date
hereof
or as of the Closing Date (for purposes of this Section 11.1(c), each such
representation and warranty shall be read without reference to any materiality
or Material Adverse Effect qualifications contained therein);
(d) any
breach of any covenant, agreement or undertaking made by the Seller or the
Members in this Agreement or the Seller Ancillary Documents; or
(e) (i)
any provision of any Environmental Law and arising out of, or relating to,
(1)
any act or omission of the Seller or its employees, agents or representatives
on
or prior to the Closing Date or (2) the ownership, use, control or operation
on
or prior to the Closing Date of any real property, plant, facility, site,
area
or property used in the Seller’s business (whether currently or previously owned
or leased by the Seller), including arising from any Release of any Hazardous
Material or off-site shipment of any Hazardous Material at or from such real
property, plant, facility, site, area or property or (ii) mold or any other
environmental matter or condition arising on or prior to the Closing
Date.
The
claims, liabilities, obligations, losses, damages, costs, expenses, penalties,
fines and judgments of the Purchaser Indemnified Parties described in this
Section 11.1 as to which the Purchaser Indemnified Parties are entitled to
indemnification are collectively referred to as “Purchaser
Losses”.
Section
11.2 Indemnification
Obligations of the Purchaser. The Purchaser shall indemnify and
hold harmless the Seller Indemnified Parties from, against and in respect
of any
and all claims, liabilities, obligations, losses, damages, costs, expenses,
penalties, fines and judgments (at equity or at law, including statutory
and
common) and damages whenever arising or incurred (including amounts paid
in
settlement, costs of investigation and reasonable attorneys’ fees and expenses)
arising out of or relating to:
(a) the
Purchaser’s failure to perform, discharge or satisfy the Assumed Liabilities,
provided, however, that the Seller Indemnified Parties shall not be
indemnified with respect to Seller Losses arising with respect to any
Non-Assignable Contract to the extent the Seller Losses result from (i) the
Seller’s failure to take any lawful action under such Non-Assignable Contract in
accordance with the Purchaser’s reasonable instructions or (ii) the Seller’s
negligence or willful misconduct;
(b) any
breach or inaccuracy of any representation or warranty made by the Purchaser
in
this Agreement or in any Purchaser Ancillary Document, whether such
representation or warranty is made as of the date hereof or as of the Closing
Date; or
(c) any
breach of any covenant, agreement or undertaking made by the Purchaser in
this
Agreement or in any Purchaser Ancillary Document.
The
claims, liabilities, obligations, losses, damages, costs, expenses, penalties,
fines and judgments of the Seller Indemnified Parties described in this Section
11.2 as to which the Seller Indemnified Parties are entitled to indemnification
are collectively referred to as “Seller Losses”.
Section
11.3 Indemnification
Procedure.
(a) Promptly
following receipt by an Indemnified Party of notice by a third party (including
any Governmental Entity) of any complaint, dispute or claim or the commencement
of any audit, investigation, action or proceeding with respect to which such
Indemnified Party may be entitled to receive payment from the other Party
for
any Purchaser Losses or any Seller Losses (as the case may be), such Indemnified
Party shall provide written notice thereof to the Purchaser or the Seller
and
the Members, as the case
may
be
(the “Indemnifying Party”), provided, however, that the
failure to so notify the Indemnifying Party shall relieve the Indemnifying
Party
from liability hereunder with respect to such claim only if, and only to
the
extent that, such failure to so notify the Indemnifying Party results in
the
forfeiture by the Indemnifying Party of rights and defenses otherwise available
to the Indemnifying Party with respect to such claim. The
Indemnifying Party shall have the right, upon written notice delivered to
the
Indemnified Party within twenty (20) days thereafter assuming full
responsibility for any Purchaser Losses or Seller Losses (as the case may
be)
resulting from such audit, investigation, action or proceeding, to assume
the
defense of such audit, investigation, action or proceeding, including the
employment of counsel reasonably satisfactory to the Indemnified Party and
the
payment of the fees and disbursements of such counsel. In the event,
however, that the Indemnifying Party declines or fails to assume the defense
of
the audit, investigation, action or proceeding on the terms provided above
or to
employ counsel reasonably satisfactory to the Indemnified Party, in either
case
within such 20-day period, then any Purchaser Losses or any Seller Losses
(as
the case may be), shall include the reasonable fees and disbursements of
counsel
for the Indemnified Party as incurred. In any audit, investigation,
action or proceeding for which indemnification is being sought hereunder
the
Indemnified Party or the Indemnifying Party, whichever is not assuming the
defense of such action, shall have the right to participate in such matter
and
to retain its own counsel at such Party’s own expense. The
Indemnifying Party or the Indemnified Party (as the case may be) shall at
all
times use reasonable efforts to keep the Indemnifying Party or Indemnified
Party
(as the case may be) reasonably apprised of the status of the defense of
any
matter the defense of which it is maintaining and to cooperate in good faith
with each other with respect to the defense of any such matter.
(b) No
Indemnified Party may settle or compromise any claim or consent to the entry
of
any judgment with respect to which indemnification is being sought hereunder
without the prior written consent of the Indemnifying Party (which may not
be
unreasonably withheld or delayed), unless (i) the Indemnifying Party fails
to
assume and maintain the defense of such claim pursuant to Section 11.3(a)
or
(ii) such settlement, compromise or consent includes an unconditional release
of
the Indemnifying Party and its officers, directors, employees and Affiliates
from all liability arising out of, or related to, such claim. An
Indemnifying Party may not, without the prior written consent of the Indemnified
Party, settle or compromise any claim or consent to the entry of any judgment
with respect to which indemnification is being sought hereunder unless such
settlement, compromise or consent (x) includes an unconditional release of
the
Indemnified Party and its officers, directors, employees and Affiliates from
all
liability arising out of, or related to, such claim, (y) does not contain
any
admission or statement suggesting any wrongdoing or liability on behalf of
the
Indemnified Party and (z) does not contain any equitable order, judgment
or term
that in any manner affects, restrains or interferes with the business of
the
Indemnified Party or any of the Indemnified Party’s Affiliates.
(c) In
the event an Indemnified Party claims a right to payment pursuant hereto,
such
Indemnified Party shall send written notice of such claim to the appropriate
Indemnifying Party (a “Notice of Claim”). Such Notice of Claim
shall specify the basis for such claim. The failure by any
Indemnified Party so to notify the Indemnifying Party
shall
not
relieve the Indemnifying Party from any liability that it may have to such
Indemnified Party with respect to any claim made pursuant to this Section
11.3(c), it being understood that notices for claims in respect of a breach
of a
representation or warranty must be delivered prior to the expiration of the
survival period for such representation or warranty under Section
11.4. In the event the Indemnifying Party does not notify the
Indemnified Party within thirty (30) days following its receipt of such notice
that the Indemnifying Party disputes its liability to the Indemnified Party
under this Article or the amount thereof, the claim specified by the Indemnified
Party in such Notice of Claim shall be conclusively deemed a liability of
the
Indemnifying Party under this Article XI, and the Indemnifying Party shall
pay
the amount of such liability to the Indemnified Party on demand or, in the
case
of any notice in which the amount of the claim (or any portion of the claim)
is
estimated, on such later date when the amount of such claim (or such portion
of
such claim) becomes finally determined. In the event the Indemnifying
Party has timely disputed its liability with respect to such claim as provided
above, as promptly as possible, such Indemnified Party and the appropriate
Indemnifying Party shall establish the merits and amount of such claim (by
mutual agreement, litigation, arbitration or otherwise) and, within five
(5)
Business Days following the final determination of the merits and amount
of such
claim, the Indemnifying Party shall pay to the Indemnified Party immediately
available funds in an amount equal to such claim as determined hereunder;
provided, however, that the Members may, at their option, pay to the
Purchaser a number of shares of Parent Stock equal to the product of (i)
the
amount of such claim pursuant to Section 11.3(c) multiplied by (ii)
0.5.
Section
11.4 Survival
Period. The representations and warranties of the Parties
contained herein shall not be extinguished by the Closing, but shall survive
the
Closing for, and all claims for indemnification in connection therewith shall
be
asserted not later than, 24 months following the Closing Date; provided,
however, that (a) each of the representations and warranties contained in
Section 4.1 (Organization), Section 4.2 (Authorization), Section 4.7
(Sufficiency of and Title to Assets), Section 4.23 (Affiliate Matters), Section
4.27 (Brokers, Finders and Investment Bankers) and Section 5.1 (Authorization)
shall survive the Closing without limitation as to time, and the period during
which a claim for indemnification may be asserted in connection therewith
shall
continue indefinitely, and (b) each of the representations and warranties
contained in Section 4.15 (Tax Returns; Taxes), Section 4.17 (Seller Benefit
Plans), Section 4.18 (Labor Relations) and Section 4.20 (Environmental Health
and Safety Matters) shall survive the Closing until, and all claims for
indemnification in connection therewith shall be asserted not later than
sixty
(60) days following, the expiration of any statute of limitations applicable
to
the rights of any Person to bring any claim with respect to such
matters. The covenants and agreements of the Parties hereunder shall
survive without limitation as to time, and the period during which a claim
for
indemnification may be asserted in connection therewith shall continue
indefinitely. Notwithstanding the foregoing, if, prior to the close
of business on the last day a claim for indemnification may be asserted
hereunder, an Indemnifying Party shall have been properly notified of a claim
for indemnity hereunder and such claim shall not have been finally resolved
or
disposed of at such date, such claim shall continue to survive and shall
remain
a basis for indemnity hereunder until such claim is finally resolved or disposed
of in accordance with the terms hereof.
Section
11.5 Liability
Limits. The total aggregate amount of the liability of the Seller
and the Members for Purchaser Losses with respect to any claims made pursuant
to
Section 11.1(c) shall be limited to $2,143,745 (the “Purchaser
Cap”). Notwithstanding the foregoing, the liability of the Seller
and the Members for Purchaser Losses arising out of or related to fraud or
willful misconduct or a breach of any representations and warranties contained
in Sections 4.1, 4.2, 4.7, 4.15, 4.17, 4.18, 4.20, 4.23, 4.27, or 5.1 shall
not
be subject to the Purchaser Cap. For the avoidance of doubt, if the
Members elect to pay for Purchaser Losses with Parent Stock pursuant to Section
11.1(c), the value of such Parent Stock shall be deemed to equal $0.50 per
share.
Section
11.6 Investigations. The
respective representations and warranties of the Parties contained in this
Agreement or any certificate or other document delivered by any Party at
or
prior to the Closing and the rights to indemnification set forth in Article
XI
shall not be deemed waived or otherwise affected by any investigation made,
or
knowledge acquired, by a Party.
Section
11.7 Set-Off. The
Purchaser shall be entitled to set-off any amount or right it may be entitled
to
pursuant to this Agreement against any amount, right or obligations owed
to the
Seller or any Member under this Agreement or any Seller Ancillary Documents.
Section
11.8 Exclusive
Remedy. Except for actions grounded in fraud, from and after the
Closing, the indemnities provided in this Article XI shall constitute the
sole
and exclusive remedy of any Indemnified Party for damages arising out of,
resulting from or incurred in connection with any claims related to this
Agreement or arising out of the transactions contemplated hereby; provided,
however, that this exclusive remedy for damages does not preclude a party
from
bringing an action for specific performance or other equitable remedy to
require
a party to perform its obligations under this Agreement or any agreement
entered
into in connection herewith.
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
Section
12.1 Seller
Representative.
(a) Xx.
Xxxxxxxx is hereby irrevocably appointed as representative, agent and
attorney-in-fact for the Seller and each Member, (i) to give and receive
notices and communications relating to the transactions and other matters
contemplated by this Agreement or the Seller Ancillary Documents, including
those relating to adjustments to the Purchase Price and indemnification claims;
(ii) to make decisions on behalf of the Seller and the Members with respect
to
the transactions and other matters contemplated by this Agreement or the
Seller
Ancillary Documents, including regarding (A) adjustments to the Purchase
Price,
(B) indemnification claims, (C) amendments to this Agreement or the Seller
Ancillary Documents and (D) the defense of third party suits that may be
the
subject of indemnification claims, and to negotiate, enter into settlements
and
compromises of, and demand litigation or arbitration with respect to such
third
party suits or claims by the Purchaser for indemnification; and (iii) to
take other actions on behalf of the Seller and the Members as contemplated
by
this Agreement or the Seller Ancillary
Documents,
including the exercise of all rights granted to the Seller and the Members
under
this Agreement or the Seller Ancillary Documents.
(b) The
Seller and each Member agrees that (i) the provisions of this Section 12.1
are independent and severable, are irrevocable and coupled with an interest
and
shall be enforceable notwithstanding any rights or remedies the Seller or
any
Member may have in connection with the transactions contemplated by this
Agreement or the Seller Ancillary Documents, (ii) the remedy at law for any
breach of the provisions of this Section 12.1 would be inadequate, and
(iii) the provisions of this Section 12.1 shall be binding upon the
successors and assigns of the Seller and each Member.
(c) A
decision, act, consent or instruction of the Seller Representative relating
to
this Agreement or the Seller Ancillary Documents shall constitute a decision
for
the Seller and all Members, and shall be final, binding and conclusive upon
the
Seller and the Members, and the Purchaser may rely upon any such decision,
act,
consent or instruction of the Seller Representative as being the decision,
act,
consent or instruction of the Seller and every Member.
Section
12.2 Notices. All
notices, communications and deliveries required or made hereunder must be
made
in writing signed by or on behalf of the Party making the same, shall specify
the Section hereunder pursuant to which it is given or being made, and shall
be
delivered personally or by telecopy transmission or by a national overnight
courier service or by registered or certified mail (return receipt requested)
(with postage and other fees prepaid) as follows:
To
the
Purchaser: Winsonic
XxXxxxx, LLC
100
Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxx 00000
Attn: Xxxxxxx
Xxxxxxx
Facsimile
No.: (000) 000-0000
with a copy
to: Paul,
Hastings, Xxxxxxxx & Xxxxxx LLP
600
Xxxxxxxxx Xxxxxx, XX, Xxxxx
0000
Xxxxxxx,
Xxxxxxx 00000-0000
Attn: Xxxxx
Xxxxxxxx
Facsimile
No.: (000)
000-0000
To
the
Seller: Colonel
XxXxxxx Trucking, LLC
100
Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxx 00000
Attn: Xxx
Xxxxxx
Facsimile
No.: (000) 000-0000
To
the
Members:
Xxxxx Xxxxxxxx
37X
Xxxxxxx Xxxxxxx
Xxxxxx,
Xxxxxxx 00000
Facsimile
No.: (000) 000-0000
or
to
such other representative or at such other address of a Party as such Party
may
furnish to the other Parties in writing. Any such notice,
communication or delivery shall be deemed given or made (a) on the date of
delivery, if delivered in person, (b) upon transmission by facsimile if receipt
is confirmed by telephone, (c) on the first (1st) Business Day following
delivery to a national overnight courier service or (d) on the fifth (5th)
Business Day following it being mailed by registered or certified
mail.
Section
12.3 Schedules
and Exhibits. The schedules and exhibits to this Agreement
are hereby incorporated into this Agreement and are hereby made a part hereof
as
if set out in full herein.
Section
12.4 Assignment;
Successors in Interest. No assignment or transfer by any Party of
such Party’s rights and obligations hereunder shall be made except with the
prior written consent of the other Parties; provided that the Purchaser shall,
without the obligation to obtain the prior written consent of any other Party,
be entitled to assign this Agreement or all or any part of its rights or
obligations hereunder to one or more Affiliates of the
Purchaser. This Agreement shall be binding upon and shall inure to
the benefit of the Parties and their respective successors and permitted
assigns, and any reference to a Party shall also be a reference to the
successors and permitted assigns thereof.
Section
12.5 Captions. The
titles, captions and table of contents contained herein are inserted herein
only
as a matter of convenience and for reference and in no way define, limit,
extend
or describe the scope of this Agreement or the intent of any provision
hereof.
Section
12.6 Controlling
Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal Laws of the State of Georgia without
reference to its choice of law rules. Except with respect to any
action, dispute, suit or proceeding arising under Section 3.3 hereof, each
Party
irrevocably and unconditionally (a) consents to submit to the exclusive
jurisdiction of the Business Case Division of the Xxxxxx County Superior
Court
located in the State of Georgia (the “Business Court”), and in the event the
Business Court does not have jurisdiction over such dispute, then of the
courts
of the State of Georgia and of the United States District Court for the Northern
District of Georgia for any action, dispute, suit or proceeding arising out
of
or relating to this Agreement (and each party irrevocably and unconditionally
agrees not to commence any such action, dispute, suit or proceeding except
in
such courts), (b) waives any objection to the laying of venue of any such
action, dispute, suit or proceeding in any such courts and (c) waives and
agrees
not to plead or claim that any such action, dispute, suit or proceeding brought
in any such court has been brought in an inconvenient forum. Each
Party hereby irrevocably waives any and all rights to trial by jury in any
legal
proceeding arising out of or related to this Agreement.
Section
12.7 Severability. Any
provision hereof that is prohibited or unenforceable in any jurisdiction
shall,
as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof,
and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by Law, each Party hereby
waives any provision of Law that renders any such provision prohibited or
unenforceable in any respect.
Section
12.8 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, and it shall not be necessary in making proof of this
Agreement or the terms hereof to produce or account for more than one of
such
counterparts.
Section
12.9 Enforcement
of Certain Rights. Nothing expressed or implied herein is
intended, or shall be construed, to confer upon or give any Person other
than
the Parties, and their successors or permitted assigns, any right, remedy,
obligation or liability under or by reason of this Agreement, or result in
such
Person being deemed a third-party beneficiary hereof.
Section
12.10 Waiver;
Amendment. Any agreement on the part of a Party to any extension
or waiver of any provision hereof shall be valid only if set forth in an
instrument in writing signed on behalf of such Party. A waiver by a
Party of the performance of any covenant, agreement, obligation, condition,
representation or warranty shall not be construed as a waiver of any other
covenant, agreement, obligation, condition, representation or
warranty. A waiver by any Party of the performance of any act shall
not constitute a waiver of the performance of any other act or an identical
act
required to be performed at a later time. This Agreement may not be
amended, modified or supplemented except by written agreement of the
Parties.
Section
12.11
Integration. This Agreement and the documents executed
pursuant hereto supersede all negotiations, agreements and understandings
among
the Parties with respect to the subject matter hereof and constitute the
entire
agreement among the Parties with respect thereto.
Section
12.12 Compliance with
Bulk Sales Laws. Each Party hereby waives compliance by the
Parties with the “bulk sales,” “bulk transfers” or similar Laws and all other
similar Laws in all applicable jurisdictions in respect of the transactions
contemplated by this Agreement.
Section
12.13 Interpretation. Where
the context requires, the use of a pronoun of one gender or the neuter is
to be
deemed to include a pronoun of the appropriate gender. References
herein to any Law shall be deemed to refer to such Law, as amended from time
to
time, and all rules and regulations promulgated thereunder. The words
“include,” “includes,” and “including” shall not be deemed to be terms of
limitation, but rather shall be deemed to be followed by the words “without
limitation.” Except as otherwise indicated, all references in this
Agreement to “Sections” and “Exhibits” are intended to refer to Sections of this
Agreement and Exhibits of this Agreement.
Section
12.14 Cooperation
Following the Closing. Following the Closing, each Party shall
deliver to the other Parties such further information and documents and shall
execute and deliver to the other Parties such further instruments and agreements
as any other Party shall reasonably request to consummate or confirm the
transactions provided for herein, to accomplish the purpose hereof or to
assure
to any other Party the benefits hereof.
Section
12.15 Transaction
Costs. Except as provided above or as otherwise expressly
provided herein, (a) the Purchaser shall pay its own fees, costs and expenses
incurred in connection herewith and the transactions contemplated hereby,
including the fees, costs and expenses of its financial advisors, accountants
and counsel, and (b) the Seller and the Members shall pay the fees, costs
and
expenses of the Seller and the Members incurred in connection
herewith
and the transactions contemplated hereby, including the fees, costs and expenses
of financial advisors, accountants and counsel to the Seller and the
Members.
* * *
IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed,
as
of the date first above written.
PURCHASER: | ||||
WINSONIC XxXXXXX, LLC | ||||
|
By:
|
/s/ Xxxxxxx Xxxxxxx | ||
Name:
|
Xxxxxxx Xxxxxxx | |||
Title:
|
Manager |
SELLER: | ||||
COLONEL XxXXXXX TRUCKING, LLC | ||||
|
By:
|
/s/ Xxxxx Xxxxxxxx | ||
Name:
|
Xxxxx Xxxxxxxx | |||
Title:
|
Manager |
MEMBERS: | ||||
|
/s/ Xxxxxxx
XxXxxxxxxx
|
|||
XXXXXXX XxXXXXXXXX |
|
/s/ Xxx
Xxxxxxx
|
|||
XXX XXXXXXX |
|
/s/ Xxxxxx
X. Xxxxxx
|
|||
XXXXXX X. XXXXXX |
|
/s/
Xxxx Xxxx
|
|||
XXXX XXXX |
|
/s/
Xxxx Xx Xxxxx
|
|||
XXXX XxXXXXX |
|
/s/
Xxxxx Xxxxxxxx
|
|||
XXXXX XXXXXXXX, AS AN INDIVIDUAL MEMBER AND AS SELLER REPRESENTATIVE |