EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
BY AND BETWEEN
XXXXXXX X. XXXXXXXX,
XXXXXXX X. XXXXXXXX
IRREVOCABLE WITHDRAWAL TRUST
DATED DECEMBER 24, 1991,
AND
XXXXXXX X. XXXXXXXX
IRREVOCABLE NON-WITHDRAWAL TRUST
DATED DECEMBER 24, 1991
AND
U.S. XPRESS ENTERPRISES, INC.
December 16, 1997
STOCK PURCHASE AGREEMENT
THIS AGREEMENT made by and between U.S. Xpress Enterprises, Inc., a Nevada
corporation (the "BUYER"), and Xxxxxxx X. Xxxxxxxx ("XXXXXXXX"), Xxxxxxx X.
Xxxxxxxx Irrevocable Withdrawal Trust Dated December 24, 1991, and Xxxxxxx X.
Xxxxxxxx Irrevocable Non-Withdrawal Trust Dated December 24, 1991 (together, the
"TRUSTS") (Xxxxxxxxx and the Trusts are collectively referred to as the
"SELLERS") is entered into on December 16, 1997. The Buyer and the Sellers are
referred to collectively herein as the "PARTIES."
W I T N E S S E T H:
WHEREAS, the Sellers in the aggregate own all of the outstanding capital stock
of Victory Express, Inc., an Ohio corporation (the "TARGET"); and
WHEREAS, the Sellers desire to sell and the Buyer desires to purchase all of
the outstanding capital stock of the Target pursuant to the terms and conditions
of this Agreement.
NOW THEREFORE, in consideration of the mutual promises and conditions
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the Parties hereto, intending to be
legally bound hereby, agree as follows:
ARTICLE I
PURCHASE AND SALE OF TARGET SHARES
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1.1 BASIC TRANSACTION. On and subject to the terms and conditions of this
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Agreement, the Buyer agrees to purchase from each of the Sellers, and each of
the Sellers agrees to sell, transfer, assign
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and deliver to the Buyer, all of his or its Shares of the Target for the
consideration specified below in Section 1.2.
1.2 PURCHASE PRICE. The Buyer agrees to pay to the Sellers at the Closing as
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consideration for the Shares Fifty-One Million Dollars ($51,000,000) (the
"PURCHASE PRICE") by delivery of the Purchase Price in cash payable by wire
transfer of immediately available funds pursuant to the wire transfer
instructions attached hereto as EXHIBIT 1.2(A). The Base Purchase Price shall
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be allocated among the Sellers in proportion to their respective holdings of
Shares as set forth in EXHIBIT 1.2(B). The Parties further agree that Five
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Million One Hundred Thousand Dollars ($5,100,000) (the "ESCROW FUNDS") shall be
withheld from the funds to be delivered pursuant to Xxxxxxxx'x wire instructions
and be delivered instead to National City Bank, Dayton, Ohio (hereinafter the
"ESCROW AGENT") in cash payable by wire transfer of immediately available funds
pursuant to wire transfer instructions attached hereto as EXHIBIT 1.2(C). All
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Escrow Funds are to be held in escrow pursuant to the terms of an Escrow
Agreement in the form of EXHIBIT 1.2(D) hereto (the "ESCROW AGREEMENT") as a
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non-exclusive source of indemnification. All payments or distributions from the
Escrow Funds shall be made in accordance with the terms of the Escrow Agreement.
All income earned on the Escrow Funds shall be for the benefit of the Sellers in
accordance with the terms of the Escrow Agreement. All fees and expenses of the
Escrow Agent incurred in connection with the escrow shall be borne equally by
the Buyer and the Sellers.
1.3 THE CLOSING. The delivery of the Purchase Price pursuant to Section 1.2
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hereof, the sale, transfer, and delivery of the Shares pursuant to Section 1.1
hereof and the delivery of the other instruments, certificates and legal
opinions required hereunder (the "CLOSING"), shall take place at the law office
of Xxxx X. Xxxxxx, Esq., 0000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxx, Xxxx, at 11:00 A.M.
local time on January, 30, 1998 or on such other date or at such other time or
place as the parties hereto shall agree in writing (the date and time of the
Closing being referred to herein as the "CLOSING DATE").
1.4 DELIVERIES AT THE CLOSING. At the Closing, (i) the Sellers will deliver
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to the Buyer the various certificates, instruments, and documents referred to in
Section 6.1 below, (ii) the Buyer will deliver to the Sellers the various
certificates, instruments, and documents referred to in Section 6.2
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below, (iii) each of the Sellers will deliver to the Buyer stock certificates
representing all of his or its Target Shares, endorsed in blank or accompanied
by duly executed assignment documents, and (iv) the Buyer will deliver to each
of the Sellers the consideration specified in Section 1.2 above.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
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In order to induce the Buyer to enter into this Agreement and the consummate
the transactions contemplated hereby, Xxxxxxxx represents and warrants that as
of the date hereof and as of the Closing Date, the following representations and
warranties are true, complete and accurate, and all such representations and
warranties shall be continuing and shall survive the Closing pursuant to Section
7.1 below. The Trusts make the statements referenced in Sections 2.1, Section
2.2 and the last sentence of Section 2.4 and are not making any representations
or warranties involving any of the other Sections in this Article III.
2.1 ORGANIZATION OF THE TRUSTS. Each Seller represents and warrants that
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each of the Trusts is duly organized, validly existing, and in good standing
under the laws of the jurisdiction of its organization. Attached hereto as
EXHIBIT 2.1 are a true, complete and correct copies of the trust agreements and
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all related documents governing the Trusts.
2.2 OWNERSHIP OF AND TITLE TO THE SHARES, ETC. Each Seller represents and
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warrants that as concerns the shares he or it possesses that he or it owns the
shares of the Target set forth opposite such Seller's name on EXHIBIT 1.2(B)
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hereof (the "SHARES"); that each such Seller has good and marketable title to
the Shares set forth after his or its name, free and clear of all liens,
encumbrances, restrictions on transfer, options, charges, security interests,
equities and claims whatsoever; that each has the full legal right, capacity and
power to execute, deliver and perform this Agreement; that this Agreement and
the collateral documents referenced herein executed by each such Seller
constitutes the legal, valid and binding obligation of each such Seller
according to its respective terms; that each such Seller has full legal right
and power to sell, transfer and deliver such Shares in the manner provided in
this Agreement; that upon delivery of, and payment for,
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such Shares pursuant to this Agreement, the Buyer will acquire good and
marketable title thereto, free and clear of all liens, encumbrances,
restrictions on transfer, options, charges, security interests, equities and
claims whatsoever; and that such Shares are at the date hereof and will on the
Closing Date be duly authorized, validly issued and outstanding, fully-paid and
non-assessable, with no personal liability attaching to the ownership thereof.
2.3 NO CONFLICT. Except as set forth on Schedule 2.3, neither the execution
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and the delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will (i) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which the Sellers or the
Target are subject or any provision of the charter, bylaws or other
organizational document of the Target or (ii) conflict with, result in a breach
of, constitute a default under, result in the acceleration of, create in any
party the right to accelerate, terminate, modify, cancel, or require any notice
under any agreement, contract, lease, license, instrument, or other arrangement
to which the Sellers or the Target are a party or by which they are bound or to
which any of the Target's assets are subject which would have a material impact
or effect on this transaction or the operations of the Target, or (iii) result
in the imposition of any lien, charge, encumbrance or other security interest
upon any of the Target's assets. There is no option, warrant, purchase right, or
other contract or commitment that could require the sale, transfer, or other
disposal of any capital stock or other securities of the Target (other than this
Agreement). There are no outstanding or authorized options, warrants, purchase
rights, subscription rights, conversion rights, exchange rights, or other
contracts or commitments that could require the Target to issue, sell, or
otherwise cause to become outstanding any of its capital stock or any other
securities. There are no outstanding or authorized stock appreciation, phantom
stock, profit participation, or similar rights with respect to the Target.
There are no voting trusts, proxies, or other agreements or understandings with
respect to the voting of the capital stock of the Target. Neither the Sellers
nor the Target are required to give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any government or governmental
agency in order for the parties to consummate the transactions contemplated by
this Agreement, other than compliance with the provisions of the Xxxx-Xxxxx-
Xxxxxx Antitrust Improvements Act.
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2.4 CAPITAL STOCK AND STOCKHOLDER RELATIONS The entire authorized capital
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stock of the Target consists of two hundred fifty (250) shares of common stock
no par value per share (the "TARGET SHARES"), of which 134.5 Target Shares are
issued and outstanding and 15.5 Target Shares are held in treasury. All of the
issued and outstanding Target Shares have been duly authorized, validly issued,
fully paid, and are nonassessable. The Shares constitute all of the issued and
(with the exception of any of the Target Shares held in treasury) outstanding
Target Shares. There are no outstanding options, warrants, contracts,
preemptive rights, proxies, calls, commitments or demands of rights of any
character obligating the Target to issue any Target Shares or options or rights
with respect thereto or any other securities, and there are not existing or
outstanding securities of any kind convertible into or exchangeable for Target
Shares. There are no outstanding obligations of the Target to repurchase,
redeem or otherwise acquire any Target Shares. No current or former stockholder
of the Target or of any corporation heretofore merged with or into the Target
has any claim or cause of action whatsoever against the Target arising out of or
in any way connected with any occurrence or state of facts in existence prior to
the Closing Date, and no such present or former stockholder shall come to have
any claim or cause of action whatsoever against the Target, or any officer,
director or stockholder of the Target, by virtue of, or in any way connected
with, the transactions contemplated by this Agreement or otherwise. By the
execution of this Agreement, the Sellers hereby waive any and all rights,
options, calls, equities or other claims (other than claims they may have
pursuant to this Agreement) which the Sellers may have with respect to the
Target Shares by reason of the transactions contemplated by this Agreement or
any prior transaction, or any other claim or demand whatsoever that they may
have against the Target.
2.5 ORGANIZATION, QUALIFICATION, AND CORPORATE POWER OF THE TARGET. The
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Target is a corporation duly organized, validly existing, and in good standing
under the laws of the State of Ohio. The Target is duly authorized to conduct
business and is in good standing under the laws of each jurisdiction where such
qualification is required, all such jurisdictions being set forth on Schedule
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2.5. The Target has all requisite authority, corporate or otherwise and all
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authorizations necessary to carry on and conduct the businesses in which it is
engaged and to own or lease and use the properties and
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assets owned and used by it. The Target is not in default under or in violation
of any provision of its charter, bylaws or other organizational or governing
instrument.
2.6 ORGANIZATIONAL DOCUMENTS. The Sellers have delivered to the Buyer (or
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will deliver within seven (7) days of the date hereof) correct, complete and
certified copies of the charter documents and bylaws of the Target (as amended
and in effect as of the date hereof), the minute books (containing complete,
correct and true records of meetings of the stockholders, the board of
directors, and any committees of the board of directors), the stock certificate
books, and the stock record books of the Target (containing the complete, true
and accurate record of stock issuances as of the date of delivery). Schedule
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2.6 contains a true and complete list of all of the current officers and
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directors of the Target.
2.7 BROKERS' FEES. Neither the Target nor the Sellers have any liability or
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obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the transactions contemplated by this Agreement.
2.8 TITLE TO ASSETS. The Target has good and marketable title to, or a valid
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leasehold interest in, the properties and assets used by it, wherever located,
including those shown on the Baseline Financial Statement of the Target dated
September 30, 1997, or acquired after the date thereof, free and clear of all
security interests, except for properties and assets disposed of in the ordinary
course of business since the date of the aforesaid balance sheet.
2.9 SUBSIDIARIES AND AFFILIATES. Except as set forth on Schedule 2.9, the
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Target does not have any subsidiaries or affiliated businesses or operations,
and there are no other assets, operations, personnel, know how or the like
owned, employed or used by the Target in the operation of the transportation
business known as "Victory Express" that would not inure to the sole benefit and
control of the Buyer upon consummation of the transactions contemplated by the
Agreement.
2.10 FINANCIAL STATEMENTS. The Sellers have delivered to the Buyer financial
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statements of the Target for the fiscal years ended December 31, 1994, December
31, 1995, December 31, 1996,
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and, attached hereto as EXHIBIT 2.10, for the month ended September 30, 1997,
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(the "BASELINE FINANCIAL STATEMENT") and the month ended November 30, 1997
(collectively the "FINANCIAL STATEMENTS"). The Financial Statements (including
the notes thereto) have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered thereby, present fairly the
financial condition of the Target as of such dates and the results of operations
of the Target for such periods, are correct and complete, and are consistent
with the books and records of the Target (which books and records are correct
and complete and kept in accordance with GAAP); provided, however, that the
Baseline Financial Statement is subject to year-end adjustments which will not
in the aggregate result in a material adverse change to the Baseline Financial
Statement. The Baseline Financial Statement will also lack footnotes and other
normal presentation items.
2.11 EVENTS SUBSEQUENT TO THE BASELINE FINANCIAL STATEMENT. Since September
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30, 1997 and other than as set forth in Schedule 2.11, Target has conducted its
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business in the ordinary course and there has not been any change in the
business, financial condition, operations, results of operations, relationships
with any suppliers or customers or future prospects of the Target which will or
is likely to have an adverse effect on either the net income or stockholders
equity of the Target. Without limiting the generality of the foregoing, since
that date and except as set forth on Schedule 2.11:
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(A) the Target has not sold, leased, transferred, or assigned any of its
assets, tangible or intangible, other than for a fair consideration in the
ordinary course of business;
(B) other than shipper contracts, the Target has not entered into any
material agreement, contract, lease, or license (or series of related
agreements, contracts, leases, and licenses) or any agreement, contract,
lease, or license (or series of related agreements, contracts, leases and
licenses) outside the ordinary course of business;
(C) no party (including the Target) has accelerated, terminated, modified,
or canceled any material agreement, contract, lease, or license (or series
of related agreements, contracts, leases, and licenses) to which the Target
is a party or by which the Target is bound;
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(D) the Target has not granted or allowed to be imposed any lien, claim,
charge, security interest or other encumbrance upon any of its assets;
(E) the Target has not made any material capital expenditure (or series of
related capital expenditures) or any capital expenditure outside the
ordinary course of business that has not been reflected on the Baseline
Financial Statement;
(F) other than in the ordinary course of business, the Target has not made
any capital investment in, or any acquisition of the securities or assets
of, any third party;
(G) the Target has not made any loan or advance to, and has not received a
loan or advance from the Sellers which will remain outstanding at the
Closing;
(H) the Target has not issued any note, bond, or other debt instrument or
created, incurred, assumed, or guaranteed any indebtedness for borrowed
money or capitalized lease obligation;
(I) the Target has not unreasonably delayed or postponed the payment of
accounts payable or other liabilities beyond the payment terms applicable
to said accounts payable or liabilities;
(J) the Target has not canceled, compromised, waived, or released any
right or claim (or series of related rights and claims) either involving
more than Twenty-Five Thousand Dollars ($25,000.00) or outside the ordinary
course of business;
(K) the Target has not granted any license or sublicense of any rights
under or with respect to any of the Target Intellectual Property;
(L) other than as set forth in the documents delivered pursuant to Section
2.6, there has been no change made or authorized in the charter or bylaws
of the Target;
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(M) the Target has not issued, sold, or otherwise disposed of any of the
Target Shares, or granted any options, warrants, or other rights to
purchase or obtain (including upon conversion, exchange, or exercise) any
of the Target Shares;
(N) the Target has not declared, set aside, nor paid any dividend or made
any distribution with respect to the Target Shares (whether in cash or in
kind) or redeemed, purchased, or otherwise acquired any of the Target
Shares;
(O) the Target has not experienced any damage, destruction, or loss
(whether or not covered by insurance) which materially adversely affect its
properties or business;
(P) the Target has not made any loan to, or entered into any other
transaction with or on behalf of (including but not limited to guarantees
of debt), any of its directors, officers, and employees other than normal
salary, bonuses and employee benefits paid or granted in the ordinary
course of business consistent with past practice; provided, however that
none of the Sellers will directly or indirectly have received any bonuses,
dividends or other forms of compensation (other than routine monthly salary
paid in the ordinary course) from January 1, 1997 through the Closing;
(Q) the Target has not granted any increase in the base compensation of
any of its directors, officers, and employees outside the ordinary course
of business, and has not adopted, amended, modified, or terminated any
bonus, profit-sharing, incentive, severance, or other plan, contract, or
commitment for the benefit of any of its directors, officers, and employees
(or taken any such action with respect to any other Employee Benefit Plan);
(R) the Target has not made any other change in employment terms for any
of its directors, officers, and employees;
(S) other than in the ordinary course of business, the Target has not made
or pledged to make any charitable or other capital contribution;
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(T) there has not been any other occurrence, event, incident, action,
failure to act, or transaction outside the ordinary course of business
involving the Target, and the Target has conducted its business in the
ordinary and usual course and in a reasonable business manner;
(U) the Target has not committed to any of the foregoing;
(V) the Target has not incurred any liability, contingent or otherwise,
except in the ordinary and usual course of business; and
(W) the Target has not made any change in any method of accounting or
principle of accounting.
2.12 UNDISCLOSED LIABILITIES. Except as set forth on Schedule 2.12, the
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Target does not have any liability or obligation whatsoever, whether accrued,
absolute, contingent or otherwise (and there is no basis for any present or
future action, suit, proceeding, hearing, investigation, charge, complaint,
claim, or demand against it giving rise to any liability), except for
liabilities set forth and adequately reserved against in the Baseline Financial
Statement and all subsequent financial statements.
2.13 LEGAL COMPLIANCE. Except as set forth on Schedule 2.13, the Target
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has reasonably complied with all applicable laws (including rules, regulations,
codes, plans, injunctions, judgments, orders, decrees, rulings, and charges
thereunder) of federal, state, local, and foreign governments (and all agencies
thereof), and no material action, suit, proceeding, hearing, investigation,
charge, complaint, claim, demand, or notice has been filed, commenced or
threatened against it alleging any failure so to comply.
2.14 TAX MATTERS.
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(A) The Target has filed all tax returns and reports that it was required
to file. All such tax returns and reports were correct and complete. All
taxes owed by the Target (whether or not
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shown on any tax return) have been paid or accrued on the Baseline
Financial Statement. The Target currently is not the beneficiary of any
extension of time within which to file any tax return or report or to make
any tax payment. No claim has ever been made by an authority in a
jurisdiction where the Target does not file tax returns or reports that the
Target is or may be subject to taxation by that jurisdiction.
(B) The Target has withheld and paid all taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or other third party.
(C) Xxxxxxxx does not expect any authority to assess any additional taxes
for any period for which tax returns have been filed. There is no dispute
or claim concerning any tax liability of the Target either (i) claimed or
raised by any authority in writing or (ii) as to which either Xxxxxxxx or
any of the officers and employees of the Target responsible for tax matters
has been notified or has knowledge based upon personal contact with any
agent of such authority. As concerns income tax, Schedule 2.14(c) sets
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forth all federal, state and local tax returns filed with respect to the
Target for taxable periods ended on or after December 31, 1987, indicates
those tax returns that have been audited, and indicates those tax returns
that currently are the subject of audit, investigation or other inquiry.
Xxxxxxxx has delivered to the Buyer correct and complete copies of all
federal and state income tax returns, examination reports, and statements
of deficiencies assessed against or agreed to by the Target since December
31, 1987. Schedule 2.14(d) sets forth all other tax returns and reports
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filed with respect to the Target for taxable periods ended on or after
December 31, 1996, indicates those tax returns that have been audited, and
indicates those tax returns that currently are the subject of audit,
investigation or other inquiry.
(D) The Target has not waived any statute of limitations in respect of
taxes or agreed to any extension of time with respect to a tax assessment
or deficiency.
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(E) The Target has not filed a consent under Code (S)341(f) concerning
collapsible corporations. The Target has not made any payments, is not
obligated to make any payments, nor is a party to any agreement that under
certain circumstances could obligate it to make any payments that will not
be deductible under Code (S)280G. The Target has not been a United States
real property holding corporation within the meaning of Code (S)8979(c)(2)
during the applicable period specified in Code (S)8979(c)(1)(A)(ii). The
Target is not a party to any tax allocation or sharing agreement. The
Target (A) has not been a member of an affiliated group filing a
consolidated federal income tax return and (B) has no liability for the
taxes of any person or entity (other than the Target) under Reg.
(S)1.1502-6 (or any similar provision of state or local law), as a
transferee or successor, by contract, or otherwise.
(F) Schedule 2.14(f) sets forth the following information with respect to
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the Target as of the most recent practicable date: (i) the basis of the
Target in its assets; and (ii) the amount of any net operating loss, net
capital loss, unused investment or other credit, unused foreign tax, or
excess charitable contribution allocable to the Target.
(G) The unpaid taxes of the Target (i) did not, as of the Baseline
Financial Statement, exceed the reserve for tax liability set forth on the
face of the Baseline Financial Statement (rather than in any notes thereto)
and (ii) do not exceed that reserve as adjusted for the passage of time
through the Closing Date in accordance with the past custom and practice of
the Target in filing tax returns.
2.15 REAL PROPERTY. Schedule 2.15(a) lists and briefly describes all real
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property that the Target leases for the operation of its terminal and general
offices (the "REAL ESTATE"). No real property is owned by the Target other than
a residential condominium located in Ft. Xxxxx, Florida (copies of the deeds,
condominium governing documents and most recent condominium fee invoice being
attached as Schedule 2.15(b) (the "CONDOMINIUM")). Attached hereto as EXHIBIT
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2.15 is a true, complete and correct copy of the lease for the Real Estate (the
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"LEASE").
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(A) GENERAL. Except for the Real Estate and the Condominium, there is no
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real property owned, leased or occupied by the Target and used or connected with
its business.
(B) CODES, ORDINANCES, USE AND NOTICE OF CONDEMNATION. There are no
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existing, pending, or proposed violations of any fire or health codes, building
ordinances, or rules of the Board of Fire Underwriters (or organization
exercising functions similar thereto), with respect to the Real Estate, nor is
there, any defect in the Real Estate which would render all or any part thereof
unsuitable for its continued use by the Target in the manner historically used
by Target except that the Real Estate is located partially on wetlands and a
flood plain and the appropriate approval has been granted to so construct and
operate the Real Estate thereon. Neither Xxxxxxxx nor the Target has received
any notice of any condemnation proceeding in process or proposed that would
affect the Real Estate. Xxxxxxxx shall advise the Buyer forthwith of any notice
concerning violations, condemnation proceeding, and tax or utility rate
increases that may affect the Real Estate.
(C) LICENSES AND PERMITS. The Target holds all licenses, certificates,
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permits, franchises and rights from all appropriate federal, state, local and
other public authorities necessary for the conduct of its current operations,
which licenses, certificates, permits, franchises and rights are specified on
Schedule 2.15(c).
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(D) NO NOTICE OF VIOLATIONS. The Target is in reasonable compliance with
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all applicable laws, rules and regulations. The Target has not received any
notice of violations of any federal, state or local laws, ordinances, rules,
regulations or orders relating to its business operations.
(E) UTILITY CONNECTIONS. All public utility connections located on or
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serving the Real Estate and the Condominium have been completed, installed,
activated, paid for and are in operational condition and are in compliance with
all appropriate codes, rules and regulations.
(F) TAXES AND UTILITIES. Sellers are not aware of, nor has the Target
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received, any notice or information of any condition which would result in an
increase in the assessments covering the Real Estate or the Condominium or
utility rates affecting the Real Estate or the Condominium.
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(G) ACCESS. The Target presently has the unencumbered right to use all
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accesses from the Real Estate and the Condominium to and from public
thoroughfares, as such accesses are presently configured and utilized.
(H) RIGHT TO OPERATE. The Target has the legal right to operate all parts of
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the Real Estate in the manner in which it is currently being operated as a
terminal and general corporate office facility for an interstate trucking
company.
(I) GOOD TITLE. Except as set forth on Schedule 2.15(i), the lessor of the
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Real Estate has good and marketable title to each parcel of Real Estate, free
and clear of any liens, mortgages, deeds to secure debt, security interests,
easement, covenant, or other restriction, except for recorded easements,
covenants, and other restrictions which do not impair the current use,
occupancy, or value, or the marketability of title, of the property subject
thereto. Except as set forth on Schedule 2.15(i), the Target has good and
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marketable title to the Condominium, free and clear of any liens, mortgages,
deeds to secure debt, security interests, easement, covenant, or other
restriction, except for recorded easements, covenants, and other restrictions
which do not impair the current use, occupancy, or value, or the marketability
of title, of the property subject thereto.
(J) NO OTHER LEASES. Except for the Lease and as set forth in Schedule
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2.15(j), there are no leases, subleases, licenses, concessions, or other
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agreements, written or oral, granting to any party or parties the right of use
or occupancy of any portion of the Real Estate or the Condominium.
(K) STATUS OF THE LEASE.
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(I) the Lease is legal, valid, binding, enforceable, and in full force
and effect in accordance with its terms, including those terms that
will go into effect as of the Closing;
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(II) the Lease will continue to be legal, valid, binding, enforceable,
and in full force and effect (assuming no default by the Target
subsequent to the Closing) following the consummation of the
transactions contemplated hereby;
(III) no party to the Lease is in breach or default, and no event has
occurred which, with notice or lapse of time, would constitute a
breach or default or permit termination, modification, or acceleration
thereunder;
(IV) no party to the Lease has repudiated any provision thereof;
(V) there are no disputes, oral agreements, or forbearance programs in
effect as to the Lease; and
(VI) except as noted in Schedule 2.15(i) the Target has not assigned,
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transferred, conveyed, mortgaged, deeded in trust, or encumbered any
interest in the Lease, and the lessor of the Lease has not assigned,
transferred, conveyed, mortgaged, deeded in trust, or encumbered any
interest in the Real Estate.
2.16 INTELLECTUAL PROPERTY. Set forth on Schedule 2.16 is a complete and
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accurate list of all intellectual property rights owned by or licensed to the
Target, including but not limited to all rights in and to servicemarks,
trademarks, tradenames (including the name "Victory Express" and all variations
thereof), copyrights, patents and the like whether or not subject to
registration (collectively the "TARGET INTELLECTUAL PROPERTY").
(A) There are no other forms of intellectual property rights necessary for
the operation of the businesses of the Target as presently conducted other
than the Target Intellectual Property. Each item of the Target Intellectual
Property owned or used by the Target immediately prior to the Closing
hereunder will be owned or available for use by the Target on identical
terms and conditions immediately subsequent to the Closing hereunder. The
Target has applied to register any trademark it owns with the Untied States
Patent and Trademark Office.
15
(B) The Target has never interfered with, infringed upon, misappropriated
or otherwise come into conflict with any intellectual property rights of
third parties, other than as listed in Schedule 2.16(b), and none of the
----------------
Sellers and the directors and officers (and employees with responsibility
for intellectual property matters) of the Target has ever received any
charge, complaint, claim, demand, or notice alleging any such interference,
infringement, misappropriation, or violation (including any claim that the
Target must license or refrain from using any intellectual property rights
of any third party). No third party has interfered with, infringed upon,
misappropriated, or otherwise come into conflict with any of the Target
Intellectual Property. The Target will not interfere with, infringe upon,
misappropriate, or otherwise come into conflict with, any intellectual
property rights of third parties as a result of the continued operation of
its businesses as presently conducted.
(C) With regard to each item of the Target Intellectual Property:
(I) the Target possess all right, title, and interest in and to the
item, free and clear of any security interest, license, or other
restriction;
(II) the item is not subject to any outstanding injunction, judgment,
order, decree, ruling, or charge;
(III) no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand is pending or threatened which challenges
the legality, validity, enforceability, use, or ownership of the item;
and
(IV) the Target has never agreed to indemnify any of Sellers or any
other third party for or against any interference, infringement,
misappropriation, or other conflict with respect to the item.
16
2.17 ROLLING STOCK AND OTHER TANGIBLE ASSETS. Other than those photocopiers
----------------------------------------
and fax machines and those items listed in Schedule 2.17 that are leased, the
-------------
Target has good, valid and marketable title to all personal and mixed, tangible
and intangible properties and assets all machinery, equipment, and other
tangible assets (including but not limited to the Rolling Stock (as herein
defined)) used in its business as presently conducted or which it otherwise
purports to own, free and clear of all liens, claims, charges and encumbrances
whatsoever. Each such tangible asset is free from defects (patent and latent),
has been maintained in accordance with normal industry practice, is in good
operating condition and repair (subject to normal wear and tear), and is
suitable for the purposes for which it presently is used. Schedule 2.17(a) sets
----------------
forth a list (by make, model, year, license plate/registration number and
vehicle identification number) of all power units and trailers used or usable by
the Target (the "ROLLING STOCK"). The Rolling Stock is "as is" and has operable
engines and drive trains except as noted in Schedule 2.17(a). Except as set
----------------
forth on Schedule 2.17(a), no item of Rolling Stock is due for major overhaul or
----------------
replacement during the next fifty thousand (50,000) miles of service. Schedule
--------
2.17(b) sets forth a list (by make, model, year, license plate/registration
-------
number and vehicle identification number) of all other motor vehicles and
equipment (other than Rolling Stock) used or usable by the Target. Schedule
--------
2.17(c) sets forth a list all other personal property owned by the Target. The
-------
location of all the Rolling Stock and other personal property located on
Schedule 2.17(a), Schedule 2.17(b) and Schedule 2.17(c) is set forth on such
---------------- ---------------- ----------------
schedules, or if the location of any such Rolling Stock or other personal
property is unknown to the Target or in transit such information shall be noted
on such schedule.
2.18 CONTRACTS. Schedule 2.18 sets forth all oral or written contracts and
---------- -------------
other agreements to which the Target is a party, including but not limited to:
(A) any agreement (or group of related agreements) for the lease of
personal property to or from any of the Sellers or any third party
providing for lease payments in excess of Fifty Thousand Dollars ($50,000)
per annum;
(B) any agreement (or group of related agreements) for the purchase or sale
of supplies, products, or other personal property, or for the furnishing or
receipt of services, the
17
performance of which will extend over a period of more than one year or
involve consideration in excess of Ten Thousand Dollars ($10,000);
(C) any agreement concerning a partnership or joint venture;
(D) any agreement (or group of related agreements) under which the Target
has created, incurred, assumed, or guaranteed any indebtedness for borrowed
money, or any capitalized lease obligation, in excess of Fifty Thousand
Dollars ($50,000) or under which it has imposed a lien on any of its
assets, tangible or intangible;
(E) any agreement concerning confidentiality or noncompetition;
(F) any agreement with any of the Sellers;
(G) any agreement for the employment of any individual on a full-time,
part-time, consulting, or other basis providing annual compensation in
excess of Ten Thousand Dollars ($10,000) or providing severance benefits or
other post-employment benefits of any amounts;
(H) any agreement under which it has advanced or loaned any amount to any
of its directors, officers, and employees other than driver advances issued
in the ordinary course of business;
(I) any agreement under which the consequences of a default or termination
could have an adverse effect on the business, financial condition,
operations, results of operations, or future prospects of the Target in
excess of Ten Thousand Dollars ($10,000) in earnings before interest,
taxes, depreciation and amortization;
(J) any other agreement (or group of related agreements) the performance of
which involves consideration in excess of Ten Thousand Dollars ($10,000);
or
18
(K) all trucking, carrier, shipper, dedicated service, broker and transport
contracts which account for more than Five Hundred Thousand Dollars
($500,000) in annual revenues. Xxxxxxxx will make available to the Buyer
prior to the Closing the files containing all other such contracts.
Xxxxxxxx has delivered to the Buyer a correct and complete copy of each written
agreement set forth on Schedule 2.18 (as amended to date) and a written summary
-------------
setting forth the terms and conditions of each oral agreement referred to in
Schedule 2.18. With respect to each such agreement: (i) the agreement is legal,
-------------
valid, binding, enforceable, and in full force and effect; (ii) the agreement
will continue to be legal, valid, binding, enforceable, and in full force and
effect on identical terms following the consummation of the transactions
contemplated hereby; (iii) no party is in breach or default, and no event has
occurred which with notice or lapse of time would constitute a breach or
default, or permit termination, modification, or acceleration, under the
agreement; (iv) no party has repudiated any provision of the agreement; and (v)
no party is the subject of bankruptcy proceedings, has had a trustee appointed
on its behalf or is insolvent.
2.19 EMPLOYEE ARRANGEMENTS, UNION AGREEMENTS AND BENEFIT PLANS AND GOVERNMENT
------------------------------------------------------------------------
COMPLIANCE.
----------
(a) Schedule 2.19(a) sets forth a complete and accurate list and
----------------
description of all oral or written employment, consulting or collective
bargaining contracts, deferred compensation, change in control agreements,
golden parachute agreements, profit-sharing, bonus, option, share purchase
or other benefit or compensation commitment, benefit plans, arrangements,
policies or plans, including all welfare plans of or pertaining to the
present or former employees of the Target, or the Target's predecessors in
interest. Except as set forth on Schedule 2.19(a), the Target and its
----------------
predecessors in interest have reasonably complied with all of their
respective obligations, including the payment of all contributions, the
filing of all reports, and the payment or accrual of all expenses for the
period between the end of the previous plan year and the Closing Date, with
respect to such contracts, commitments, arrangements and plans. The plans
have been maintained in compliance with all applicable
19
laws and regulations. The levels of insurance reserves and accrued
liabilities with regard to all such plans are reasonable and are sufficient
to provide for all incurred but unreported claims and any retroactive
premium adjustments.
(B) Except as set forth on Schedule 2.19(b), the Target has never had any
----------------
oral or written employment, consulting or collective bargaining contracts,
deferred compensation, change in control agreements, golden parachute
agreements, profit-sharing, bonus, option, share purchase or other benefit
or compensation commitment, benefit plans, arrangements or plans, including
all welfare plans of or pertaining to the present or former employees of
the Target, or the Target's predecessors in interest.
(C) Schedule 2.19(c) sets forth the name of each salaried employee of the
----------------
Target and such employee's annual salary, position and hire date.
(D) Except as disclosed on Schedule 2.19(d), the Target is reasonably in
----------------
compliance with all worker compensation laws and requirements of all
applicable states.
(E) Except to the extent set forth in Schedule 2.19(e):
----------------
(I) The Target is in compliance with all applicable laws and
collective bargaining agreements respecting employment (if any) and
employment practices, terms and conditions of employment and wages and
hours and occupational safety and health;
(II) There is no unfair labor practice, charge or complaint or any
other matter against or involving the Target or pending or, to the
Target's knowledge, threatened before the National Labor Relations
Board or any court of law;
(III) There is no labor strike, dispute, slowdown or stoppage actually
pending or, to the Target's knowledge, threatened against the Target;
20
(IV) To the Target's knowledge, no certification or decertification
question or organizational drive exists or has existed within the past
twenty-four months respecting the employees of the Target;
(V) No grievance proceeding or arbitration proceeding arising out of
or under any collective bargaining agreement is pending against the
Target, or, to the knowledge of the Target, threatened; and, to the
knowledge of the Target, no basis for any claim therefor exists;
(VI) Except for general labor relation laws, no agreement (including
any collective bargaining agreement), arbitration or court decision or
governmental order which is binding on the Target in any way limits or
restricts the Target from relocating or closing any of its operations;
(VII) The Target has not experienced any organized work stoppage or
other labor difficulty since January 1, 1988; and
(VIII) There are no charges, or known administrative proceedings or
formal complaints of discrimination (including discrimination based
upon sex, age, marital status, race, national origin, sexual
preference, handicap or veteran status) pending before the Equal
Employment Opportunity Commission or any federal, state or local
agency or court against the Company. Except as disclosed in Schedule
--------
2.19(e), since January 1, 1992, there have been no governmental audits
-------
of the equal employment opportunity practices of the Target.
2.20 EMPLOYEE BENEFIT PLANS.
----------------------
(A) Target does not have and has never had an employee pension benefit
plan.
21
(B) Schedule 2.20(b) lists any employee welfare benefit plan within the
----------------
meaning of Section 3(1) of the Employee Retirement Income Security Act of
1974 ("ERISA") maintained or contributed to by the Target during the last
five (5) years and with respect to any group health plan subject to COBRA,
maintained or contributed to by the Target during the last five (5) years.
"COBRA" means the provisions for the continuation of health care enacted by
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, as
set forth in Section 4080B of the Code (and any amendments or predecessor
or successor provisions) and Sections 601 through 608 of ERISA (and any
amendments or predecessor or successor provisions), including any
regulations promulgated under the applicable provisions of the Code and
ERISA. As of the Closing Date, each of the employee benefit plans set forth
in Schedule 2.20(b) and the Retirement Plan (collectively, the "EMPLOYEE
----------------
BENEFIT PLANS") are in material compliance with, and have been administered
in material compliance with, the provisions of ERISA and the Code.
(C) In connection with each Employee Benefit Plan:
(I) The Target has provided to the Buyer true, complete and correct
copies of (A) each Employee Benefit Plan (or, in the case of any
unwritten Employee Benefit Plan, a description thereof), (B) each
trust agreement, group annuity contract, and any other contract
relating to any Employee Benefit Plan, (C) the three (3) most recent
Forms 990 and the three most recent Annual Reports, including all
schedules, exhibits, and audits (Form 5500) filed for each Employee
Benefit Plan for which such a filing is required; and there has been
no material change or amendment to any of such documents or filings
relating to the Employee Benefit Plans as of the Closing Date; (D) the
most recent Summary Plan Descriptions and all Summary of Material
Modifications prepared subsequent to such Summary Plan Descriptions,
(E) the three (3) most recent Summary Annual Reports prepared and
distributed for each Employee Benefit Plan for which such document is
required, (F) the three most recent actuarial reports for the
Retirement Plan, (G) all Notices of Reportable Events filed with the
Pension Benefit Guaranty
22
Corporation, (H) with respect to the Retirement Plans, a copy (or if
not formally published, a description) of the established policies and
procedures reasonably designed to promote and facilitate overall
compliance with the requirements of Section 401(a) of the Code and all
corrections made since January 1, 1997, as a result of such policies
and procedures, and (I) a copy of all Forms 5330.
(II) Neither the Target nor any fiduciary as defined in Section 3(21)
of ERISA has taken any action or failed to take any action which would
result in any liability to the Target after the Closing Date for
matters prior to the Closing Date with respect to any Employee Benefit
Plan, other than the payment of the specified benefits.
(III) There is not any contract, plan or commitment or legal
requirement (other than the funding requirement of ERISA with respect
to the Retirement Plan), that would require the Target to create any
additional employee benefit plan to provide or designed to provide
benefits for any its employees or their dependents or beneficiaries or
that would require the Target to make any additional contribution to
or to pay any expense of the Retirement Plan or to any Employee
Benefit Plan for matters occurring prior to the Closing Date.
(IV) There is no action, suit, grievance, arbitration or other manner
of litigation, or claim with respect to the assets of any Employee
Benefit Plan (other than routine claims for benefits made in the
ordinary course of Employee Benefit Plan administration for which
administrative review procedures have not been exhausted) pending,
threatened or imminent against or with respect to the Employee Benefit
Plan, the Target or any other fiduciary (as defined in Section 3(21)
of ERISA) of any Employee Benefit Plan (including any action, suit,
grievance, arbitration or other manner of litigation, or claim
regarding conduct which allegedly interferes with the attainment of
rights under any Employee Benefit Plan).
23
(V) Neither the Target nor any other fiduciary (as defined in
Section 3(21) of ERISA) has any knowledge of any facts which would
give rise to or could give rise to any action, suit, grievance,
arbitration or other manner of litigation, or claim with respect to
any Employee Benefit Plan.
(D) Schedule 2.20(e) sets forth the names of claimants, the relationship
----------------
to the employee and amount and description of all claims made under any
policy or plan of health benefits sponsored by the Target, whether or not
insured, during the last five years that aggregate Five Thousand Dollars
($5,000) or more with respect to any claimant.
2.21 NOTES AND ACCOUNTS RECEIVABLE. In the ordinary course of business all
------------------------------
notes and accounts receivable of the Target are reflected properly on its books
and records, are valid receivables subject to no refunds, adjustments, defenses,
restrictions, assignments, disputes, setoffs or counterclaims, are current and
collectible, and will be collected in accordance with their terms at their
recorded amounts within 120 days of the date incurred without resort to legal
process, subject only to the reserve for bad debts set forth on the face of the
Baseline Financial Statement (rather than in any notes thereto) as adjusted for
the passage of time through the Closing Date in accordance with the past custom
and practice of the Target.
2.22 POWERS OF ATTORNEY. There are no outstanding powers of attorney
------------------
executed on behalf of the Target.
2.23 INSURANCE. Schedule 2.23 sets forth the following information with
---------- -------------
respect to each insurance policy (including policies providing property,
casualty, liability, and workers' compensation coverage and bond and surety
arrangements) to which the Target has been a party, a named insured, or
otherwise the beneficiary of coverage at any time within the past five (5)
years:
(A) the name, address, and telephone number of the agent;
24
(B) the name of the insurer, the name of the policyholder, and the name of
each covered insured;
(C) the policy number and the period of coverage;
(D) the scope (including an indication of whether the coverage was on a
claims made, occurrence, or other basis) and amount (including a
description of how deductibles and ceilings are calculated and operate) of
coverage; and
(E) a description of any retroactive premium adjustments or other loss-
sharing arrangements.
With respect to each such insurance policy: (i) the policy is legal, valid,
binding, enforceable, and in full force and effect; (ii) the policy will
continue to be legal, valid, binding, enforceable, and in full force and effect
on identical terms following the consummation of the transactions contemplated
hereby (subject to (A) the terms of the policy, (B) the payment of premiums and
(C) to no notice of cancellation by the Target subsequent to the Closing); (iii)
neither the Target nor any other party to the policy is in breach or default
(including with respect to the payment of premiums or the giving of notices),
and no event has occurred which, with notice or the lapse of time, would
constitute such a breach or default, or permit termination, modification, or
acceleration, under the policy; and (iv) no party to the policy has repudiated
any provision thereof. The Target has been covered during the past five (5)
years by insurance in scope and amount customary and reasonable for the
businesses in which it has engaged during the aforementioned period. Schedule
--------
2.23 describes any self-insurance arrangements affecting the Target.
----
2.24 LITIGATION AND CLAIMS. Schedule 2.24(a) sets forth each instance in
---------------------- ----------------
which the Target (i) is subject to any outstanding injunction, judgment, order,
decree, ruling, claim or charge, or (ii) is a party or is threatened to be made
a party to any action, claim, suit, proceeding, hearing, or investigation of,
in, or before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign jurisdiction or before any arbitrator. Set
forth on Schedule 2.24(b) are copies of all accident registers and loss runs
----------------
relating to all open matters not totally resolved and closed. Set forth on
25
Schedule 2.24(c) are copies of the cargo loss log relating to all open matters
----------------
not totally resolved and closed. Schedule 2.24(d) sets out all facts of which
----------------
the Target is aware involving any bodily injury, property, vehicular or cargo
incident between the Target and a third party occurring since January 1, 1998,
where no claim has yet been made or threatened and which is not reflected on
either Schedule 2.24(a), Schedule 2.24(b) or Schedule 2.24(c). Schedule 2.24(a),
---------------- ---------------- ---------------- ----------------
Schedule 2.24(b) and Schedule 2.24(c) each set forth in individual detail all
---------------- ----------------
liabilities recorded in the financial statements, including booked reserves and
accruals relating to each entry.
2.25 GUARANTIES. The Target is not a guarantor or otherwise is liable for
----------
any liability or obligation (including indebtedness) of any other person or
entity.
2.26 ENVIRONMENTAL, HEALTH, AND SAFETY MATTERS. ENVIRONMENTAL PROTECTION.
----------------------------------------- ------------------------
The Target has reasonably obtained all permits, licenses and other
authorizations and filed all notices and reports which are required to be
obtained or filed by it for the operation of its business under federal, state
and local laws relating to environmental matters, health and safety, pollution,
or protection of the environment (the "HSE LAWS"). The Target is in compliance
in all material respects with all terms and conditions of such required permits,
licenses and authorizations. The Target is in compliance in all material
respects with all other applicable limitations, restrictions, conditions,
standards, prohibitions, requirements, obligations, schedules and timetables
contained in the HSE Laws or contained in any law, regulation, code, plan,
order, decree, judgment, notice or demand letter issued, entered, promulgated or
approved thereunder. In addition to the foregoing, the Target specifically
warrants that all underground storage tanks ("USTS") presently or previously
located on the Real Estate at all times were in compliance in all material
respects with the HSE Laws or that any violations have been properly corrected
to the satisfaction of the appropriate governmental authority, and further
warrants that all USTs presently on the Real Estate are in reasonable compliance
with the 1998 UST upgrade requirements. Except as disclosed on Schedule 2.26,
-------------
there are no past or present events, conditions, circumstances, activities,
practices, incidents, actions or plans which may interfere with or prevent
continued compliance in all material respects with, or which may give rise to
any material common law or statutory liability, or otherwise form the basis of
any material claim, action, suit, notice of
26
violation, proceeding, or hearing pursuant to the HSE Laws, nor has there been
any distribution, use, treatment, storage, disposal, transport, handling,
emission, discharge, release or threatened release into the environment of any
pollutant, contaminant, or hazardous or toxic material or waste with respect to
the Target or its business. Except as disclosed on Schedule 2.26, the Target has
-------------
received no notice of violation or the like or any complaint or other threat of
any actions by any party related in any way to the HSE laws. The Real Estate
does not contain any asbestos, urea-formaldehyde, lead-based paint, or PCBs in
any form. The Buyer will conduct a Phase I Environmental Site Assessment
("ESA") of the Real Estate at the Buyer's expense not later than January 15,
1998. The Buyer may, at its option conduct a Phase II ESA on any item of concern
noted in the Phase I ESA. Any material violation of the HSE Laws documented by
the Phase II ESA but not reported by the Target on Schedule 2.26, shall be, at
-------------
the Buyer's option, corrected to the satisfaction of the appropriate
governmental authority by or at the cost of the Seller, or corrected by the
Buyer with the cost of correction deducted from the purchase price hereunder.
2.27 ABSENCE OF CERTAIN PAYMENTS. Other than for services legitimately and
---------------------------
openly performed under applicable law, business discounts customarily granted in
the ordinary course of business and nominal non-cash gifts (with a total per
donee retail value of less than $100 in any year), neither the Target, nor, to
Xxxxxxxx'x knowledge, any agent, employee or representative of the Target has
made or offered to make to any customer, supplier, government official,
insurance carrier, referral source, employee or agent or any other person or
entity, any payment, gratuity, gift, service or thing of material value. For
purposes of this Section, "material" shall mean a fair market value of One
Hundred Dollars ($100.00) or more, and "person" shall not include the Sellers.
2.28 ANTITRUST MATTERS. The Target is and throughout any applicable
-----------------
statutory period of limitation has been in compliance with all laws, regulations
and/or ordinances, whether federal, state or municipal, pertaining or relating
in any way to the regulation of competition or trade among or between business
entities, including but not limited to, Sections 1 and 2 of the Xxxxxxx Act,
Section 3 of the Xxxxxxx Act, the Xxxxxxxx-Xxxxxx Act, the Xxxxxx Act, Section 5
of the Federal Trade Commission Act and applicable state or municipal antitrust
and trade laws,
27
regulations and/or ordinances. The business and operations of the Target, or any
predecessor, affiliate, parent or subsidiary thereof, have been conducted in
full and complete compliance with any and all such laws, regulations and/or
ordinances.
2.29 SAFETY RATING. Except as noted in Schedule 2.29, the Target holds a
------------- -------------
Satisfactory safety rating from the United States Department of Transportation
and has always held same since such ratings were first issued.
2.30 ORGANIZATIONS AND CLUBS. Set forth on Schedule 2.30 is a listing of
----------------------- -------------
all organizations and clubs of which the Target is a member or to which it pays
dues or fees on behalf of itself or any person, which person shall be identified
in the schedule.
2.31 BANK ACCOUNTS. Schedule 2.31 sets forth a complete and accurate list
-------------- -------------
of each bank or financial institution at which the Target has an account or safe
deposit box (giving the address and account numbers) and the names of the
persons authorized to draw thereon or to have access thereto.
2.32 MAJOR SUPPLIERS AND CUSTOMERS. Schedule 2.32 sets forth a list of the
----------------------------- -------------
Target's fifty (50) largest suppliers and fifty (50) largest customers for the
year ended December 31, 1997, together with in each case the amount paid or
billed during such period. To Xxxxxxxx'x knowledge, the Target, other than as
noted in Schedule 2.32 is not engaged in any material dispute with any of such
-------------
suppliers or customers. None of the officers or directors of the Target, or any
person related to any officer or director of the Target, or any company or other
organization in which any officer or director of the Target, or any person
related to any officer or director of the Target has a direct or indirect
financial interest, has any material financial interest in any supplier or
customer of the Target.
2.33 DISCLOSURE. The representations and warranties contained in this
-----------
Article II do not contain any untrue statement of a material fact nor omit to
state any material fact necessary in order to make the statements and
information contained in this Article II not misleading.
28
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BUYER
-------------------------------------------
In order to induce the Sellers to enter into this Agreement and the consummate
the transactions contemplated hereby, the Buyer represents and warrants that as
of the date hereof and as of the Closing Date, the following representations and
warranties are true, complete and accurate, and all such representations and
warranties shall be continuing and shall survive the Closing pursuant to Section
7.1 below.
3.1 ORGANIZATION OF THE BUYER. The Buyer is a corporation duly organized,
--------------------------
validly existing, and in good standing under the laws of the State of Nevada.
3.2 AUTHORIZATION OF TRANSACTION. The Buyer has full power and authority
-----------------------------
(including full corporate power and authority) to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement constitutes
the valid and legally binding obligation of the Buyer, enforceable in accordance
with its terms and conditions. Except as set forth on Schedule 3.2 and
------------
compliance with the provisions of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act, the Buyer need not give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency in
order to consummate the transactions contemplated by this Agreement.
3.3 NONCONTRAVENTION. Except as set forth on Schedule 3.3, neither the
----------------- ------------
execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (a) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which the Buyer
is subject or any provision of its charter or bylaws or (b) conflict with,
result in a breach of, constitute a default under, result in the acceleration
of, create in any party the right to accelerate, terminate, modify, or cancel,
or require any notice under any agreement, contract, lease, license, instrument,
or other
29
arrangement to which the Buyer is a party or by which it is bound or to which
any of its assets is subject.
3.4 BROKERS' FEES. The Buyer has no liability or obligation to pay any fees
--------------
or commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which any Seller could become liable or
obligated.
3.5 INVESTMENT. The Buyer is not acquiring the Shares with a view to or for
-----------
sale in connection with any distribution thereof within the meaning of the
Securities Act of 1933.
ARTICLE IV
PRE-CLOSING COVENANTS
---------------------
The Parties agree as follows with respect to the period between the execution of
this Agreement and the Closing.
4.1 GENERAL. Each of the Parties will use his or its best efforts to take all
--------
action and to do all things necessary, proper, or advisable in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth in
Article VI below).
4.2 NOTICES AND CONSENTS. Xxxxxxxx will cause the Target to give any notices
---------------------
to third parties, and will cause the Target to use its best efforts to obtain
any third party consents, that the Buyer may request in connection with the
matters referred to in Section 2.3 above. Each of the Parties will (and
Xxxxxxxx will cause the Target to) give any notices to, make any filings with,
and use its best efforts to obtain any authorizations, consents, and approvals
of governments and governmental agencies in connection with the matters referred
to in Section 2.3, Section 3.2 and Section 3.3 above. Without limiting the
generality of the foregoing, each of the Parties will file (and Xxxxxxxx will
cause the Target to file) any Notification and Report Forms and related material
that he or it may be required to file with
30
the Federal Trade Commission and the Antitrust Division of the United States
Department of Justice under the Xxxx-Xxxxx-Xxxxxx Act, will use his or its best
efforts to obtain (and Xxxxxxxx will cause the Target to use its best efforts to
obtain) an early termination of the applicable waiting period, and will make
(and Xxxxxxxx will cause the Target to make) any further filings pursuant
thereto that may be necessary, proper, or advisable in connection therewith.
Xxxxxxxx, without prior consultation with the Buyer, shall not cause or permit
the Target to purchase or contract to purchase any equipment or Rolling Stock,
regardless of whether such purchase is in the ordinary course of business.
4.3 OPERATION OF BUSINESS. Xxxxxxxx will not cause or permit the Target to
----------------------
engage in any practice, take any action, or enter into any transaction outside
the ordinary course of business. Without limiting the generality of the
foregoing, Xxxxxxxx without prior written consent from the Buyer will not cause
or permit the Target to (a) declare, set aside, or pay any dividend or make any
distribution with respect to its capital stock or redeem, purchase, or otherwise
acquire any of its capital stock, (b) enter into a transaction with the Sellers,
or (c) otherwise engage in any practice, take any action, or enter into any
transaction of the sort described in Section 2.11 above.
4.4 PRESERVATION OF BUSINESS. Xxxxxxxx will cause the Target to keep its
-------------------------
business and properties substantially intact, including its present operations,
Rolling Stock, physical facilities, working conditions, and relationships with
lessors, licensors, suppliers, customers, and employees. Xxxxxxxx will
immediately notify the Buyer upon Xxxxxxxx or the Target receiving any
indication that a customer or certain customers intends to reduce substantially
or cease doing business with the Target. For purposes of this Section,
"customer" shall mean a customer who individually accounts for five per cent
(5%) of the Target's annual gross revenue and "certain customers" shall mean
customers who in the aggregate (whether related or not) account for five per
cent (5%) of the Target's annual gross revenue.
4.5 FULL ACCESS. Xxxxxxxx will permit, and Xxxxxxxx will cause the Target to
------------
permit, representatives of the Buyer to have full access at all reasonable
times, including permitting the Buyer's independent accountants to conduct on
audit of the Target, and in a manner so as not to interfere with
31
the normal business operations of the Target, to all premises, properties,
personnel, books, records (including tax records), contracts, and documents of
or pertaining to the Target.
4.6 NOTICE OF DEVELOPMENTS. Each Party will give prompt written notice to the
-----------------------
others of any material adverse development causing a breach of any of their
respective representations and warranties in Article II and Article III above.
4.7 EXCLUSIVITY. None of the Sellers will (and Xxxxxxxx will not cause or
------------
permit the Target to) (a) solicit, initiate, or encourage the submission of any
proposal or offer from any person or entity relating to the acquisition of any
capital stock or other voting securities, or any substantial portion of the
assets, of the Target (including any acquisition structured as a merger,
consolidation, or share exchange) or (b) participate in any discussions or
negotiations regarding, furnish any information with respect to, assist or
participate in, or facilitate in any other manner any effort or attempt by any
person or entity to do or seek any of the foregoing. None of the Sellers will
vote their respective Shares in favor of any such acquisition structured as a
merger, consolidation, share exchange or purchase of assets. Xxxxxxxx will
notify the Buyer immediately if any person or entity makes any proposal, offer,
inquiry, or contact with respect to any of the foregoing.
4.8 SURVEY. With respect to the Real Estate, Xxxxxxxx will cause the Target
-------
to procure in preparation for the Closing a current survey of the Real Estate
certified to the Buyer, prepared by a licensed surveyor and conforming to
current ALTA Minimum Detail Requirements for Land Title Surveys, disclosing the
location of all improvements, easements, party walls, sidewalks, roadways,
utility lines, and other matters shown customarily on such surveys, and showing
access affirmatively to public streets and roads (the "SURVEY"). There shall be
no any survey defect or encroachment from or onto the Leased Property which has
not been cured or insured over prior to the Closing.
4.9 SETTLEMENT OF DEBT. Xxxxxxxx shall ensure that on or before the Closing
-------------------
that all outstanding debts and liabilities between the Sellers and the Target
are settled in cash.
32
4.10 TRANSFER OF THE BUYER'S PROPERTY TO THE REAL PROPERTY. Xxxxxxxx shall
------------------------------------------------------
cause the Target to allow the Buyer to move certain of its assets to and store
and manage them at and from the Real Estate prior to the Closing Date if the
Closing Date occurs after January 15, 1998.
ARTICLE V
POST-CLOSING COVENANTS
----------------------
The Parties agree as follows with respect to the period following the Closing.
5.1 GENERAL. In case at any time after the Closing any further action is
-------
necessary or desirable to carry out the purposes of this Agreement, each of the
Parties will promptly take without further consideration such further action
(including the execution and delivery of such further instruments and documents)
as any other Party reasonably may request. Xxxxxxxx acknowledges and agrees
that from and after the Closing the Buyer will be entitled to possession of all
documents, books, records (including tax records), agreements, and financial
data of any sort relating to the Target.
5.2 LITIGATION SUPPORT. In the event and for so long as any Party actively is
-------------------
contesting or defending against any action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand in connection with (a) any
transaction contemplated under this Agreement or (b) any fact, situation,
circumstance, status, condition, activity, practice, plan, occurrence, event,
incident, action, failure to act, or transaction on or prior to the Closing Date
involving the Target, each of the other Parties will cooperate with him or it
and his or its counsel in the contest or defense, make available their
personnel, and provide such testimony and access to their books and records as
shall be necessary in connection with the contest or defense, all at the sole
cost and expense of the contesting or defending Party (unless the contesting or
defending Party is entitled to indemnification therefor under Article VIII
below).
5.3 TRANSITION. Xxxxxxxx will not take any action that is designed or
-----------
intended to have the effect of discouraging any lessor, licensor, customer,
supplier, or other business associate of the Target from maintaining the same
business relationships with the Target after the Closing as it maintained with
33
the Target prior to the Closing. Xxxxxxxx will refer all customer inquiries
relating to the businesses of the Target to the Buyer from and after the
Closing.
5.4 CONFIDENTIALITY. Xxxxxxxx will treat and hold all nonpublic information
----------------
of the Target as confidential information for a period of three (3) years
subsequent to the Closing and refrain from using any of the confidential
information except in connection with this Agreement, and deliver promptly to
the Buyer or destroy, at the request and option of the Buyer, all tangible
embodiments (and all copies) of the confidential information which are in his or
its possession. In the event that any of the Sellers is requested or required
(by oral question or request for information or documents in any legal
proceeding, interrogatory, subpoena, civil investigative demand, or similar
process) to disclose any confidential information, that Seller will notify the
Buyer promptly of the request or requirement so that the Buyer may seek an
appropriate protective order or waive compliance with the provisions of this
Section. If, in the absence of a protective order or the receipt of a waiver
hereunder, any of the Sellers is, on the advice of counsel, compelled to
disclose any confidential information to any tribunal or else stand liable for
contempt, that Seller may disclose the confidential information to the tribunal;
provided, however, that the disclosing Seller shall use his or its reasonable
-----------------
best efforts to obtain, at the reasonable request of the Buyer, an order or
other assurance that confidential treatment will be accorded to such portion of
the confidential information required to be disclosed as the Buyer shall
designate. The foregoing provisions shall not apply to any confidential
information which is generally available to the public immediately prior to the
time of disclosure so long as such general availability is not due to a breach
by the Sellers with the provisions of this Section.
ARTICLE VI
CONDITIONS TO OBLIGATION TO CLOSE
---------------------------------
6.1 CONDITIONS TO OBLIGATION OF THE BUYER. The obligation of the Buyer to
--------------------------------------
consummate the transactions to be performed by it in connection with the Closing
is subject to satisfaction of the following conditions:
34
(A) the representations and warranties set forth in Article II shall be
true and correct in all material respects at and as of the Closing Date;
(B) the Sellers shall have performed and complied with all of their
covenants hereunder in all material respects through the Closing;
(C) the Target shall have procured all of the third party consents
specified in Section 2.3 above and the Survey (except for those consents
covered under Section 6.1(f) below);
(D) no action, suit, or proceeding shall be pending or threatened before
any court or quasi-judicial or administrative agency of any federal, state,
local, or foreign jurisdiction or before any arbitrator wherein an
unfavorable injunction, judgment, order, decree, ruling, or charge would
(i) prevent consummation of any of the transactions contemplated by this
Agreement, (ii) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation, (iii) affect adversely
the right of the Buyer to own the Shares and to control the Target, or (iv)
affect adversely the right of the Target to own its assets and to operate
its businesses (and no such injunction, judgment, order, decree, ruling, or
charge shall be in effect);
(E) Xxxxxxxx shall have delivered to the Buyer a certificate to the effect
that each of the conditions specified above in Section 6.1(a)-(d) is
satisfied in all respects;
(F) all applicable waiting periods (and any extensions thereof) under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act shall have expired or
otherwise been terminated and the Parties and the Target shall have
received all other authorizations, consents, and approvals of governments
and governmental agencies referred to in Section 3.2;
(G) Xxxxxxxx shall have executed the Escrow Agreement;
35
(H) Xxxxxxxx shall have entered into a non-competition and consulting
agreement with the Target and the Buyer in the form of EXHIBIT 6.1(H)
--------------
hereto (the "NON-COMPETITION AND CONSULTING AGREEMENT");
(I) the Buyer shall have received from counsel for Xxxxxxxx, an opinion,
dated the Closing Date and in form and substance reasonably satisfactory to
the Buyer's counsel, to the effect that:
(I) the Target is a corporation validly existing and in good
standing under the laws of the State of Ohio;
(II) this Agreement and the collateral documents to be executed in
connection herewith constitute the valid and binding obligations of
Xxxxxxxx, enforceable in accordance with their terms except as
enforcement may be limited by bankruptcy, insolvency or other laws
affecting the enforcement of creditors' rights generally and except
that the availability of the remedy of specific performance or other
equitable relief is subject to the discretion of the court before
which any proceeding therefor may be brought;
(III) the authorized capital stock of the Target consists of Two
Hundred Fifty (250) shares of common stock, no par value per share,
and, based upon a review of the minute books and stock books of the
Target and upon specified certificates of appropriate officers of the
Target, there are 134.5 shares of such stock issued and outstanding
and there are 15.5 shares held as treasury stock, all of which issued
and outstanding shares are owned of record by the Sellers, have been
duly authorized, are validly issued and outstanding, and are fully
paid and nonassessable;
(IV) insofar as such counsel are aware, and based upon a review of
the minute books and stock books of the Target, neither the Target nor
the Sellers are a party
36
to, or bound by, any outstanding option, warrant, agreement (other
than this Agreement), preemptive right, proxy, call, commitment or
demand or right of any character obligating the Target or the Sellers
to sell, issue or otherwise dispose of any capital stock of the Target
or any option or rights with respect thereto;
(V) Insofar as such counsel are aware, neither the execution and
delivery of this Agreement by Xxxxxxxx nor compliance with the terms
and provisions hereof by Xxxxxxxx will violate any provision of any
injunction, order or decree of any governmental agency, authority or
court of which such counsel are aware; and
(VI) The Non-Competition and Consulting Agreement hereto constitutes
the valid and binding obligation of Xxxxxxxx, enforceable in
accordance with its terms except as enforcement may be limited by
bankruptcy, insolvency or other laws affecting the enforcement of
creditors' rights generally and except that the availability of the
remedy of specific performance or other equitable relief is subject to
the discretion of the court before which any proceeding therefor may
be brought;
(J) the Buyer shall have received the resignations, effective as of the
Closing, of each director and officer of the Target other than those whom
the Buyer shall have specified in writing at least five (5) business days
prior to the Closing; such resignation to be accompanied by a waiver of any
and all claims against the Target (such resignation and waiver to be in
form and content reasonably acceptable to the Buyer and its counsel);
(K) there shall not have occurred any material adverse change since
December 31, 1996 in the business, properties, assets, liabilities, results
of operations, prospects or financial condition of the Target or physical
loss or damage to any of the properties or assets (which, if covered by
insurance could not be fully replaced within thirty (30) days of such loss
or damage without payment by the Target of a deductible in excess of three
(3) per cent of the loss amount) of the Target which materially and
adversely affects or impairs
37
the business now being or to be conducted by the Target, and the Sellers
shall have delivered to the Buyer a certificate, signed by the Sellers and
dated the Closing Date, to all such effects. For purposes of this Section,
a "material adverse change" shall be as determined by the Buyer in its sole
discretion;
(L) Xxxxxxxx shall have entered into an amendment of the Lease that
provides: (i) for the continuation of the present term through December 31,
2007 at the present lease rate; (ii) that upon termination of that present
Lease term, the Target shall have an option to extend the Lease for four
(4) consecutive terms of five (5) years each, each renewal term subject to
adjustment based upon the Consumer Price Index and at such other terms
satisfactory to the Buyer; (iii) that the Target shall have a right of
first refusal to purchase the Real Estate should Xxxxxxxx ever sell the
Real Estate; and (iv) that there are no defaults existing under the Lease
as of the Closing Date, nor any condition which, with notice or the passage
of time, or both, will result in a default under the Lease;
(m) Xxxxxxxx shall have delivered to the Buyer: (i) a certified copy of
the charter of the Target from the Ohio Secretary of State; (ii) a
certificate of good standing from the Ohio Secretary of State (and any
other state in which the Target is qualified); and (iii) a certified copy
of the Target's bylaws;
(N) the Schedules and Exhibits hereto, certified as true and correct by
Xxxxxxxx under Section 9.1(b), shall have been delivered to the Buyer and
such schedules and exhibits shall be satisfactory in the sole opinion of
the Buyer. At Closing, Xxxxxxxx shall issue a "bring down" certificate
certifying that there have been no material changes in the information
contained in the Schedules and Exhibits since the date of the prior
certification, or if there have been changes, specifying the changes. The
Buyer shall have the right to approve or reject any such changes in its
sole discretion, provided that it acts in good faith in doing so;
38
(O) the Buyer shall have been given an opportunity to review all financial
and legal aspects of the Target's business, including an inspection of its
facilities and a review of its accounting and tax records, and to conduct
interviews of its officers and employees, and shall have discovered no
information or circumstances that cause it to believe that the Target may
suffer a material liability in the future that has not been adequately
disclosed and/or reserved for on the Financial Statements;
(P) all actions to be taken by the Sellers in connection with consummation
of the transactions contemplated hereby and all schedules hereto, exhibits
hereto, certificates, opinions, instruments, and other documents required
to effect the transactions contemplated hereby will be satisfactory in form
and substance to the Buyer and its counsel;
(Q) the execution and performance of this Agreement and the transactions
contemplated hereby shall have been approved by the Buyer's Board of
Directors; and
(R) Xxxxxxxx shall have executed a Memorandum of Lease substantially in the
form of EXHIBIT 6.1(R).
--------------
The Buyer may waive any condition specified in this Section 6.1 if it executes a
writing so stating at or prior to the Closing.
6.2 CONDITIONS TO OBLIGATION OF THE SELLERS. The obligation of the Sellers
---------------------------------------
to consummate the transactions to be performed by them in connection with the
Closing is subject to satisfaction of the following conditions:
(A) the representations and warranties set forth in Article III above shall
be true and correct in all material respects at and as of the Closing Date;
(B) the Buyer shall have performed and complied with all of its covenants
hereunder in all material respects through the Closing;
39
(C) no action, suit, or proceeding shall be pending or threatened before
any court or quasi-judicial or administrative agency of any federal, state,
local, or foreign jurisdiction or before any arbitrator wherein an
unfavorable injunction, judgment, order, decree, ruling, or charge would
(i) prevent consummation of any of the transactions contemplated by this
Agreement or (ii) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation (and no such injunction,
judgment, order, decree, ruling, or charge shall be in effect);
(D) the Buyer shall have delivered to the Sellers a certificate to the
effect that each of the conditions specified above in Section 6.2(a)-(c) is
satisfied in all respects;
(E) all applicable waiting periods (and any extensions thereof) under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act shall have expired or
otherwise been terminated and the Parties and the Target shall have
received all other authorizations, consents, and approvals of governments
and governmental agencies referred to in Section 3.2;
(F) the Buyer shall have executed the Escrow Agreement;
(G) the Buyer shall have executed the Non-competition and Consulting
Agreement;
(H) the Sellers shall have received from Xxxx, Xxxxxxx and Xxxxxxxx, P.C.,
counsel for the Buyer, an opinion, dated the Closing Date and in form and
substance reasonably satisfactory to counsel for Stockholders, to the
effect that:
(I) the Buyer is a corporation validly existing and in good
standing under the laws of the State of Nevada;
(II) the Buyer has the corporate power to execute and deliver this
Agreement and to carry out the terms and conditions hereof;
40
(III) the execution, delivery and performance of this Agreement by
the Buyer has been duly authorized by all necessary corporate action;
and
(IV) This Agreement and the collateral documents to be executed in
connection herewith constitute the valid and binding obligations of
the Buyer, enforceable in accordance with their terms (except as
enforcement may be limited by bankruptcy, insolvency or other laws
affecting enforcement of creditors' rights generally and except that
the availability of the remedy of specific performance or other
equitable relief is subject to the discretion of the court before
which any proceeding therefor may be brought);
(I) the Buyer shall have delivered to the Sellers a certificate of good
standing from the Nevada Secretary of State certifying the good standing of
the Buyer;
(J) the Buyer shall have delivered to the Sellers a copy of the resolutions
of the Buyer's Board of Directors or duly authorized committee thereof that
approve this transaction, said copy being certified by the corporate
secretary of the Buyer; and
(K) all actions to be taken by the Buyer in connection with consummation of
the transactions contemplated hereby and all certificates, opinions,
instruments, and other documents required to effect the transactions
contemplated hereby will be reasonably satisfactory in form and substance
to the Sellers.
The Sellers may waive any condition specified in this Section 6.2 if they
execute a writing so stating at or prior to the Closing.
41
ARTICLE VII
REMEDIES FOR BREACHES OF THIS AGREEMENT
---------------------------------------
7.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
-------------------------------------------
representations and warranties of the Parties contained in this Agreement shall
survive the Closing hereunder (even if the damaged party knew or had reason to
know of any misrepresentation or breach of warranty or covenant at the time of
Closing) and continue in full force and effect subject to any applicable
statutory period of limitations.
7.2 INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE BUYER.
----------------------------------------------------
(A) Xxxxxxxx agrees to defend, indemnify and hold the Buyer harmless from
and against and with respect to any and all loss, damage, liability,
deficiency, cost, obligation, or expense resulting from or with respect to
(i) any breach of any covenant or warranty or representation or any
material inaccuracy or material misrepresentation by him or the Trusts
contained in this Agreement or any certificate or document delivered to the
Buyer by Xxxxxxxx or the Trusts in connection with the transactions
contemplated hereby; (ii) the failure of the Sellers, or any of the
Sellers, to perform or comply with any covenant, agreement or obligation
required by this Agreement to be performed or compiled with by the Sellers;
and (iii) all undisclosed, unbooked, under accrued or under reserved
liabilities, including, but not limited to, assessments, taxes, penalties,
interest, claims, losses, fines and judgments. All claims for
indemnification shall bear interest at a rate equal to the rate earned on
the Escrow Funds from the date of receipt of notice of claim as provided in
Section 7.5 until the date such claim is satisfied.
(B) Notwithstanding anything contained herein, no claim for indemnification
shall be made by the Buyer hereunder against Xxxxxxxx for any claims under
Section 7.2(a) that does not exceed Twenty Thousand Dollars ($20,000). And
in any event, Xxxxxxxx shall have no liability hereunder for any and all
claims in excess of Twenty Thousand Dollars ($20,000) of every type and
description until such claims exceed the aggregate sum of
42
Five Hundred Thousand Dollars ($500,000), at which time Xxxxxxxx shall
incur liability for the entire amount of all subsequent claims in excess of
Twenty Thousand Dollars ($20,000). The aggregate sum of Five Hundred
Thousand Dollars ($500,000) will be increased by the difference between the
amount of the reserve, accrual or booked amount for any claim and the
amount for which such liability is actually settled.
7.3 INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLERS. The Buyer
------------------------------------------------------
agrees to defend, indemnify and hold the Sellers harmless from and against and
with respect to any and all loss, damage, liability, deficiency, cost,
obligation, or expense resulting from or with respect to (i) any breach of any
covenant or warranty or representation or any material inaccuracy or material
misrepresentation by the Buyer contained in this Agreement or any certificate or
document delivered by the Buyer to the Sellers in connection with the
transactions contemplated hereby; and (ii) the failure of the Buyer to perform
or comply with any covenant, agreement or obligation required by this Agreement
to be performed or compiled with by the Buyer. All claims for indemnification
shall bear interest at a rate equal to the rate earned on the Escrow Funds from
the date of receipt of notice of claim as provided in Section 7.5 until the date
such claim is satisfied.
7.4 MATTERS INVOLVING THIRD PARTIES.
--------------------------------
(A) If any third party shall notify any Party (the "INDEMNIFIED PARTY")
with respect to any matter (a "THIRD PARTY CLAIM") which may give rise to a
claim for indemnification against any other Party (the "INDEMNIFYING
PARTY") under this Article VII, then the Indemnified Party shall promptly
notify each Indemnifying Party thereof in writing; provided, however, that
-----------------
no delay on the part of the Indemnified Party in notifying any Indemnifying
Party shall relieve the Indemnifying Party from any obligation hereunder
unless (and then solely to the extent) the Indemnifying Party thereby is
prejudiced.
(B) Any Indemnifying Party will have the right to defend the Indemnified
Party against the Third Party Claim with counsel of its choice reasonably
satisfactory to the Indemnified Party so long as (i) the Indemnifying Party
notifies the Indemnified Party in writing within fifteen (15)
43
days after the Indemnified Party has given notice of the Third Party Claim
that the Indemnifying Party will indemnify the Indemnified Party from and
against the entirety of any losses the Indemnified Party may suffer
resulting from, arising out of, relating to, in the nature of, or caused by
the Third Party Claim, (ii) the Indemnifying Party provides the Indemnified
Party with evidence reasonably acceptable to the Indemnified Party that the
Indemnifying Party will have the financial resources to defend against the
Third Party Claim and fulfill its indemnification obligations hereunder,
(iii) the Third Party Claim involves only money damages and does not seek
an injunction or other equitable relief, (iv) settlement of, or an adverse
judgment with respect to, the Third Party Claim is not, in the good faith
judgment of the Indemnified Party, likely to establish a precedential
custom or practice materially adverse to the continuing business interests
of the Indemnified Party, and (v) the Indemnifying Party conducts the
defense of the Third Party Claim actively and diligently.
(C) So long as the Indemnifying Party is conducting the defense of the
Third Party Claim in accordance with Section 7.4(b) above, (i) the
Indemnified Party may retain separate co-counsel at its sole cost and
expense and participate in the defense of the Third Party Claim, (ii) the
Indemnified Party will not consent to the entry of any judgment or enter
into any settlement with respect to the Third Party Claim without the prior
written consent of the Indemnifying Party (not to be withheld
unreasonably), and (iii) the Indemnifying Party will not consent to the
entry of any judgment or enter into any settlement with respect to the
Third Party Claim without the prior written consent of the Indemnified
Party (not to be withheld unreasonably).
(D) In the event any of the conditions in Section 7.4(b) above is or
becomes unsatisfied, however, (i) the Indemnified Party may defend against,
and consent to the entry of any judgment or enter into any settlement with
respect to, the Third Party Claim in any manner it reasonably may deem
appropriate (and the Indemnified Party need not consult with, or obtain any
consent from, any Indemnifying Party in connection therewith), (ii) the
Indemnifying Parties will reimburse the Indemnified Party promptly and
periodically for the costs of defending against the Third Party Claim
(including reasonable attorneys' fees and expenses), and (iii) the
Indemnifying Parties will remain responsible for any adverse consequences
the
44
Indemnified Party may suffer resulting from, arising out of, relating to,
in the nature of, or caused by the Third Party Claim to the fullest extent
provided in this Article VII.
7.5 NOTICE OF CLAIM. When a Party determines in good faith that it has a
----------------
claim or potential claim for indemnification pursuant to this Article VII it
shall deliver notice thereof to the other Party at the address specified in
Section 12.7. Such notice shall set forth the section or sections under this
Agreement pursuant to which such claim is made and the amount or estimate of the
claim and shall state, in reasonable detail, the basis for such claim. The
Indemnifying Party shall have twenty (20) days after receipt of a notice of
claim within which to either pay such claim or notify the Indemnified Party of
the Indemnifying Party's disagreement with all or a portion of said claim. If
the Indemnified Party has not received notice of disagreement from the
Indemnifying Party within the twenty (20) day period, the amount of the claim
shall be compensible in full. If the Indemnified Party receives within the
twenty (20) day period a notice of disagreement regarding only a portion of a
claim, the portion of the claim not subject to disagreement shall be
compensible. If the Parties are unable to resolve the validity or the amount of
a claim after said twenty (20) day period, then the dispute may be resolved by
arbitration to be conducted in Chattanooga, Tennessee, in accordance with the
then existing rules of the American Arbitration Association, and the decision
rendered by the arbitrator (who shall be selected by mutual consent by the
Parties and, if the Parties are unable to agree on an arbitrator, submitted to
American Arbitration Association office in Nashville, Tennessee, for resolution)
shall be binding upon the Parties. Any judgment upon any arbitration award may
be entered in the highest state or federal court having jurisdiction thereof. In
the event the Buyer makes any claim against the Escrow Funds, the Buyer shall
provide the Escrow Agent with notice in accordance with the Escrow Agreement and
the Escrow Agent shall, pending resolution of such claim, withhold payment to
the Sellers of that portion of the Escrow Funds that are reasonably necessary to
satisfy the claim. Nothing herein shall be deemed to prevent the Buyer from
making a claim for indemnification hereunder for potential or contingent claims
or demands provided the notice sets forth the specific basis for any such
potential or contingent claim or demand to the extent then feasible and the
Buyer has reasonable grounds to believe that such a claim or demand may be made.
45
7.6 OTHER INDEMNIFICATION PROVISIONS. The foregoing indemnification
---------------------------------
provisions are in addition to, and not in derogation of, any statutory,
equitable, or common law remedy (including without limitation any such remedy
arising under HSE Laws) any Party may have with respect to the Target or the
transactions contemplated by this Agreement. Xxxxxxxx hereby agrees that he
will not make any claim for indemnification against the Target by reason of the
fact that he was a director, officer, employee, or agent of any such entity or
was serving at the request of any such entity as a partner, trustee, director,
officer, employee, or agent of another entity (whether such claim is for
judgments, damages, penalties, fines, costs, amounts paid in settlement, losses,
expenses, or otherwise and whether such claim is pursuant to any statute,
charter document, bylaw, agreement, or otherwise) with respect to any action,
suit, proceeding, complaint, claim, or demand brought by the Buyer against
Xxxxxxxx (whether such action, suit, proceeding, complaint, claim, or demand is
pursuant to this Agreement, applicable law, or otherwise).
ARTICLE VIII
TAX MATTERS
------------
The following provisions shall govern the allocation of responsibility as
between the Buyer and Xxxxxxxx for certain tax matters following the Closing
Date:
8.1 TAX PERIODS ENDING ON OR BEFORE THE CLOSING DATE. The Buyer shall
-------------------------------------------------
prepare or cause to be prepared and file or cause to be filed all tax returns
for the Target for all periods ending on or prior to the Closing Date which are
filed after the Closing Date. The Buyer shall permit Xxxxxxxx to review and
comment on each such tax return described in the preceding sentence prior to
filing. Xxxxxxxx'x obligation to reimburse the Buyer for taxes of the Target
with respect to such period to the extent such taxes are not reflected in the
reserve for tax liability is set forth in Section 7.2.
8.2 TAX PERIODS BEGINNING BEFORE AND ENDING AFTER THE CLOSING DATE. The
---------------------------------------------------------------
Buyer shall prepare or cause to be prepared and file or cause to be filed any
tax returns of the Target for tax periods which begin before the Closing Date
and end after the Closing Date. Xxxxxxxx'x obligation to reimburse the Buyer an
amount equal to the portion of such taxes which relates to the portion of such
46
taxable period ending on the Closing Date to the extent such taxes are not
reflected in the reserve for tax liability is set forth in Section 7.2. For
purposes of this Section, in the case of any taxes that are imposed on a
periodic basis and are payable for a taxable period that includes (but does not
end on) the Closing Date, the portion of such tax which relates to the portion
of such taxable period ending on the Closing Date shall (a) in the case of any
taxes other than taxes based upon or related to income or receipts, be deemed to
be the amount of such tax for the entire taxable period multiplied by a fraction
the numerator of which is the number of days in the taxable period ending on the
Closing Date and the denominator of which is the number of days in the entire
taxable period, and (b) in the case of any tax based upon or related to income
or receipts be deemed equal to the amount which would be payable if the relevant
taxable period ended on the Closing Date. Any credits relating to a taxable
period that begins before and ends after the Closing Date shall be allocated in
the same manner. All determinations necessary to give effect to the foregoing
allocations shall be made in a manner consistent with prior practice of the
Target.
8.3 COOPERATION ON TAX MATTERS.
---------------------------
(A) The Buyer and Xxxxxxxx shall cooperate fully, as and to the extent
reasonably requested by the other Party, in connection with the filing of
tax returns pursuant to this Section and any audit, litigation or other
proceeding with respect to taxes. Such cooperation shall include the
retention and (upon the other Party's request) the provision of records and
information which are reasonably relevant to any such audit, litigation or
other proceeding and making employees available on a mutually convenient
basis to provide additional information and explanation of any material
provided hereunder.
(B) the Buyer and Xxxxxxxx further agree, upon request, to use their best
efforts to obtain any certificate or other document from any governmental
authority or any other person or entity as may be necessary to mitigate,
reduce or eliminate any tax that could be imposed (including, but not
limited to, with respect to the transactions contemplated hereby).
47
(C) the Buyer and Xxxxxxxx further agree, upon request, to provide the
other Party with all information that either party may be required to
report pursuant to Section 6043 of the Code and all Treasury Department
regulations promulgated thereunder.
8.4 TAX SHARING AGREEMENTS. Xxxxxxxx shall cause all tax sharing
-----------------------
agreements or similar agreements with respect to or involving the Target shall
to be terminated as of the Closing Date and, after the Closing Date, the Target
shall not be bound thereby or have any liability thereunder.
8.5 CERTAIN TAXES. All transfer, documentary, sales, use, stamp,
--------------
registration and other such taxes and fees (including any penalties and
interest) incurred in connection with this Agreement, shall be paid by Xxxxxxxx
when due, and Xxxxxxxx will, at his own expense, file all necessary tax returns
and other documentation with respect to all such transfer, documentary, sales,
use, stamp, registration and other taxes and fees, and, if required by
applicable law, the Buyer will, and will cause its affiliates to, join in the
execution of any such tax returns and other documentation.
ARTICLE IX
TERMINATION
-----------
9.1 TERMINATION OF AGREEMENT. The Parties may terminate this Agreement
-------------------------
as provided below:
(A) the Buyer and the Sellers may terminate this Agreement by mutual
written consent at any time prior to the Closing;
(B) Notwithstanding any other provision in this Agreement, it is understood
that this Agreement has been executed without the Schedules and Exhibits
contemplated hereby and that Xxxxxxxx shall have until January 9, 1998,
unless otherwise extended by the Buyer, to deliver all of such Schedules
and Exhibits to the Buyer under the certificate of Xxxxxxxx stating that
the attachments constitute all the Schedules and Exhibits contemplated in
this Agreement for which Xxxxxxxx is responsible and that such Schedules
48
and Exhibits are true and correct to the best of his knowledge, information
and belief. Upon receipt of such certificate and schedules, the Buyer shall
have a period of fifteen days in which to review and satisfy itself with
respect to the content of such schedules (the "REVIEW PERIOD"), and
Xxxxxxxx will, and Xxxxxxxx will cause the Target to, cooperate fully with
the Buyer in connection with its review and due diligence with respect to
such schedules during the Review Period. If, prior to the expiration of the
Review Period, the Buyer finds any matter or items disclosed on such
Schedules and Exhibits, or which should have been disclosed and was not so
disclosed on such Schedules and Exhibits, which the Buyer determines in
good faith to be material and to cause the Buyer not to proceed with the
acquisition of the Shares, then Buyer shall give notice in writing to the
Sellers on or before the Closing Date of its election to terminate this
Agreement and not to purchase the Shares;
(C) the Buyer may terminate this Agreement by giving written notice to the
Sellers on or before the Closing Date if the Buyer's continuing business,
legal, environmental, and accounting due diligence regarding the Target
reveals any fact or facts that would or could reasonably likely result in
materially adverse consequences or changes to the business of the Target as
presently conducted subsequent to the consummation of the transactions
contemplated by this Agreement;
(D) the Buyer may terminate this Agreement by giving written notice to the
Sellers at any time prior to the Closing (i) in the event any of the
Sellers have breached any material representation, warranty, or covenant
contained in this Agreement in any material respect, the Buyer has notified
the Sellers of the breach, and the breach has continued without cure for a
period of thirty (30) days after the notice of breach or (ii) if the
Closing shall not have occurred on or before January 31, 1998, by reason of
the failure of any condition precedent under Section 6.1 hereof (unless the
failure results primarily from the Buyer itself breaching any
representation, warranty, or covenant contained in this Agreement); and
49
(E) the Sellers may terminate this Agreement by giving written notice to
the Buyer at any time prior to the Closing in the event the Buyer has
breached any material representation, warranty, or covenant contained in
this Agreement in any material respect, any of the Sellers has notified the
Buyer of the breach, and the breach has continued without cure for a period
of thirty (30) days after the notice of breach.
9.2 EFFECT OF TERMINATION. If any Party terminates this Agreement
----------------------
pursuant to Section 9.1 above, all rights and obligations of the Parties
hereunder shall terminate without any liability of any Party to any other Party
(except for any liability of any Party then in breach), including any obligation
of Xxxxxxxx relating to the Non-Compete and Consulting Agreement and the Lease
(as amended per Section 6.1(l)).
ARTICLE X
DEFINITIONS, SCHEDULES AND EXHIBITS
-----------------------------------
10.1 DEFINITIONS.
-----------
DEFINED TERM SECTION WHERE DEFINED
------------ ---------------------
Baseline Financial Statement Section 2.10
Buyer Preamble
Closing Section 1.3
Closing Date Section 1.3
COBRA Section 2.20(b)
Condominium Section 2.15
Employee Benefits Plans Section 2.20(b)
ERISA Section 2.20(b)
ESA Section 2.26
Escrow Agent Section 1.2
Escrow Agreement Section 1.2
Escrow Funds Section 1.2
Financial Statements Section 2.10
HSE Laws Section 2.26
Indemnified Party Section 7.4(a)
Indemnifying Party Section 7.4(a)
Lease Section 2.15
Non-Competition Consulting Agreement Section 6.1(h)
Parties Preamble
50
Purchase Price Section 1.2
Real Estate Section 2.15
Review Period Section 9.1(b)
Rolling Stock Section 2.17
Xxxxxxxx Preamble
Sellers Preamble
Shares Section 2.2
Survey Section 4.8
Target Recitals
Target Intellectual Property Section 2.16
Target Shares Section 2.4
Third Party Claim Section 7.4(a)
Trusts Preamble
USTs Section 2.26
10.2 LIST OF SCHEDULES AND EXHIBITS.
------------------------------
SCHEDULES DESCRIPTION
--------- -----------
Schedule 2.3 Conflicts and Consents
Schedule 2.5 Jurisdictions in which the Target is Qualified
Schedule 2.6 Officers & Directors
Schedule 2.9 Subsidiaries & Affiliates
Schedule 2.11 Events Subsequent to Baseline Financial Statement
Schedule 2.12 Undisclosed Liabilities
Schedule 2.13 Legal Compliance
Schedule 2.14(c) Income Taxes
Schedule 2.14(d) Other Taxes
Schedule 2.14(f) Tax Basis, NOL's, etc.
Schedule 2.15(a) Leased Real Property
Schedule 2.15(b) Condominium Documents
Schedule 2.15(c) Licenses & Permits
Schedule 2.15(i) Good Title
Schedule 2.15(j) Leases & Subleases
Schedule 2.16 Intellectual Property
Schedule 2.16(b) Intellectual Property Infringement
Schedule 2.17 Leased Tangible Assets
Schedule 2.17(a) Rolling Stock
Schedule 2.17(b) Motor Vehicle & Equipment
Schedule 2.17(c) Personal Property
Schedule 2.18 Contracts
Schedule 2.19(a) Employment Policies & Contracts
Schedule 2.19(b) Employee Benefits
51
Schedule 2.19(c) Salaried Employees
Schedule 2.19(d) Workers' Compensation Compliance
Schedule 2.19(e) Labor Relations & Compliance
Schedule 2.20(b) Employee Benefit Plans
Schedule 2.20(e) Employee Claims
Schedule 2.23 Insurance
Schedule 2.24(a) Litigation Claims
Schedule 2.24(b) Accident Registers & Loss Runs
Schedule 2.24(c) Cargo Loss Logs
Schedule 2.24(d) Incidents since January 1, 1998
Schedule 2.26 Environmental, Health & Safety Matters
Schedule 2.29 Safety Rating
Schedule 2.30 Organizations & Clubs
Schedule 2.31 Bank Accounts
Schedule 2.32 Major Suppliers & Customers
Schedule 3.2 Authorization of Transaction
Schedule 3.3 Noncontravention
EXHIBITS DESCRIPTION
-------- ------------
Exhibit 1.2(a) Sellers' Wire Transfer Instructions
Exhibit 1.2(b) Outstanding Stock of the Target
Exhibit 1.2(c) Escrow Agent's Wire Transfer Instructions
Exhibit 1.2(d) Escrow Agreement
Exhibit 2.1 Trust Agreements
Exhibit 2.10 Baseline Financial Statement
Exhibit 2.15 Lease
Exhibit 6.1(h) Non-Competition Consulting Agreement
Exhibit 6.1(r) Memorandum of Lease
ARTICLE XI
MISCELLANEOUS
-------------
11.1 PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. It is the understanding of
----------------------------------------
the parties that on the date of execution of this Agreement, Xxxxxxxx with the
Buyer will jointly announce the subject matter of this Agreement to the
employees of the Target and the Buyer, issue press releases and make the
requisite government notice filings.
52
11.2 NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any
-----------------------------
rights or remedies upon any person or entity other than the Parties and their
respective successors and permitted assigns.
11.3 ENTIRE AGREEMENT. This Agreement (including the documents referred
-----------------
to herein) constitutes the entire agreement among the Parties and supersedes any
prior understandings, agreements, or representations by or among the Parties,
written or oral, to the extent they related in any way to the subject matter
hereof.
11.4 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and
--------------------------
inure to the benefit of the Parties named herein and their respective heirs,
personal representative, estates, successors and permitted assigns. No Party may
assign either this Agreement or any of his or its rights, interests, or
obligations hereunder without the prior written approval of the Buyer and The
Sellers; provided, however, that the Buyer may (i) assign any or all of its
-----------------
rights and interests in the assets hereunder to one or more of its affiliated
companies and (ii) designate one or more of its affiliate companies to perform
its obligations hereunder (in any or all of which cases the Buyer nonetheless
shall remain responsible for the performance of all of its obligations
hereunder).
11.5 COUNTERPARTS. This Agreement may be executed in one or more
-------------
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
11.6 HEADINGS. The section headings contained in this Agreement are
---------
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
11.7 NOTICES. All notices, requests, demands, claims, and other
--------
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
53
If to the Buyer:
----------------
U.S. Xpress Enterprises, Inc.
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
With a Copy to:
---------------
Xxxx, Xxxxxxx & Xxxxxxxx, P.C.
0000 XxxXxxxx Xxxx Xxxxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, III, Esq.
Fax: (000)000-0000
If to the Sellers:
------------------
XXXXXXXX:
Xxxxxxx X. Xxxxxxxx
00 Xxxxxxxxx Xxxxx
Xxxxx, XX 00000
Fax: (000) 000-0000
With a Copy to:
---------------
Xxxx X. Xxxxxx, Esq.
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
If to the Trusts:
-----------------
National City Bank
Attn: Trust Department
0 Xxxxx Xxxx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
54
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy or ordinary mail), but no such notice, request, demand, claim,
or other communication shall be deemed to have been duly given unless and until
it actually is received by the intended recipient. Any Party may change the
address to which notices, requests, demands, claims, and other communications
hereunder are to be delivered by giving the other Parties notice in the manner
herein set forth.
11.8 GOVERNING LAW. This Agreement shall be governed by and construed in
--------------
accordance with the domestic laws of the State of Tennessee without giving
effect to any choice or conflict of law provision or rule (whether of the State
of Tennessee or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Tennessee.
11.9 AMENDMENTS AND WAIVERS. No amendment of any provision of this
-----------------------
Agreement shall be valid unless the same shall be in writing and signed by the
Buyer and Xxxxxxxx. No waiver by any Party of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, shall be
deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any prior or subsequent such occurrence. The course of conduct or
course of dealing of the parties shall not operate to modify or waive the
provisions of this Section.
11.10 SEVERABILITY. Any term or provision of this Agreement that is
-------------
inavalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. In such event, the offending provision
shall be modified to the minimum extent necessary to make it valid and
enforceable.
11.11 EXPENSES. Each of the Parties shall bear its own costs and expenses
---------
(including legal fees and expenses) incurred in connection with this Agreement
and the transactions contemplated hereby.
55
11.12 CONSTRUCTION. The Parties have participated jointly in the
-------------
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation. The Parties intend
that each representation, warranty, and covenant contained herein shall have
independent significance. If any Party has breached any representation,
warranty, or covenant contained herein in any respect, the fact that there
exists another representation, warranty, or covenant relating to the same
subject matter (regardless of the relative levels of specificity) which the
Party has not breached shall not detract from or mitigate the fact that the
Party is in breach of the first representation, warranty, or covenant.
11.13 INCORPORATION OF EXHIBITS, ANNEXES, AND SCHEDULES. The Exhibits,
--------------------------------------------------
Annexes, and Schedules identified in this Agreement are incorporated herein by
reference and made a part hereof.
11.14 SPECIFIC PERFORMANCE. Each of the Parties acknowledges and agrees
--------------------
that the other Parties would be damaged irreparably in the event any of the
provisions of this Agreement are not performed in accordance with their specific
terms or otherwise are breached. Accordingly, each of the Parties agrees that
the other Parties shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Agreement and to enforce specifically this
Agreement and the terms and provisions hereof in any action instituted in any
court of the United States or any state thereof having jurisdiction over the
Parties and the matter, in addition to any other remedy to which they may be
entitled, at law or in equity.
11.15 SUBMISSION TO JURISDICTION. Each of the Parties submits to the
---------------------------
jurisdiction of any state or federal court sitting in Chattanooga, Tennessee, in
any action or proceeding arising out of or relating to this Agreement and agrees
that all claims in respect of the action or proceeding may be heard and
determined in any such court. Each Party also agrees not to bring any action or
proceeding arising out of or relating to this Agreement in any other court. Each
of the Parties waives any defense of
56
inconvenient forum to the maintenance of any action or proceeding so brought and
waives any bond, surety, or other security that might be required of any other
Party with respect thereto. Each Party agrees that a final judgment in any
action or proceeding so brought shall be conclusive and may be enforced by suit
on the judgment or in any other manner provided by law or at equity.
*****
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
date first above written.
U.S. XPRESS ENTERPRISES, INC.
By:____________________________
Xxx X. Xxxxxx
Title: Co-Chairman and Secretary
SELLERS:
_______________________________
XXXXXXX X. XXXXXXXX
Owner of 71.5 shares of Common Stock
XXXXXXX X. XXXXXXXX
IRREVOCABLE WITHDRAWAL TRUST
DATED DECEMBER 24, 1991
_______________________________
By:____________________________
Position:________________________
NATIONAL CITY BANK, F/K/A
THE FIRST NATIONAL BANK,
DAYTON, OHIO, TRUSTEE
Owner of 4 shares of Common Stock
57
XXXXXXX X. XXXXXXXX
IRREVOCABLE NON-WITHDRAWAL TRUST
DATED DECEMBER 24, 1991
_______________________________
By:____________________________
Position:________________________
NATIONAL CITY BANK, F/K/A
THE FIRST NATIONAL BANK,
DAYTON, OHIO, TRUSTEE
Owner of 59 shares of Common Stock
58
