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EXHIBIT 10.2
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AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS AMENDMENT TO STOCK PURCHASE AGREEMENT ("AMENDMENT") is dated as of
December 8, 1995, by and among by and among Able Telcom Holding Corporation, a
Florida corporation ("Able"), H.C. Investments, Inc. a wholly-owned subsidiary
of Able ("Purchaser"), and X. X. Xxxxxxx and Xxxx X. Xxxxxxx, individuals
residing at 0000 X.X. 000X, Xxxxxxxx, Xxxxxxx (hereinafter individually
referred to as a "Seller" and collectively referred to as "Sellers").
RECITALS
A. The parties have entered into that certain Stock Purchase
Agreement dated as of October 31, 1995, providing for the purchase by Purchaser
of all of the outstanding capital stock of Seller. Unless otherwise defined
herein, all capitalized terms shall have the meanings set forth in the Purchase
Agreement.
B. The parties wish to amend certain terms and agreements
contained in the Purchase Agreement and to include additional provisions which
relate to the transactions contemplated by the Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants herein contained, the receipt and adequacy of which are hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
1. Purchase Price. Section 2(b), with respect to the Purchase
Price, is hereby amended to read as follows:
(b) Purchase Price. The aggregate purchase price of
$2,215,074 (the "Purchase Price") for the Shares, subject to the adjustments
provided herein, shall consist of:
(i) $500,000, by wire transfer at the Closing to an
account designated by Sellers in writing at least
five days prior to the Closing ("Closing Payment");
(ii) $1,465,074, by the issuance to Sellers of a
promissory note executed by Purchaser, in said
principal amount, payable on June 8, 1996, and
bearing interest at the rate of 6.0% per annum, in
the form attached hereto as Exhibit 1(a) (the "Term
Note");
(iii) $250,000, by the issuance to Sellers of a promissory
note executed by Purchaser, in said principal amount,
payable on December 8, 1996, and bearing interest at
the rate of 1.0% in excess of the prime rate of
interest
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set forth, from time to time, in the "Money
Rates" section of the Wall Street Journal, in the
form attached hereto as Exhibit 1(b) (the "Indemnity
Note"). Although the Indemnity Note may not be
prepaid, the Purchaser shall have the option, at any
time, to substitute a cash escrow account for the
Indemnity Note pursuant to the terms of Section
2(b)(ii) of the Stock Purchase Agreement.
(iv) The Term Note and the Indemnity Note will be secured
by a collateral pledge of all shares of capital stock
of the Company held by Purchaser pursuant to the
Pledge and Security Agreement in the form attached
hereto as Exhibit 1(c) (the "Pledge and Security
Agreement"), which shares of capital stock will be
held in escrow by Xxxxxxx X. Xxxx, P.A. pursuant to
an Escrow Agreement among Purchaser, the Sellers and
the Escrow Agent, in the form attached hereto as
Exhibit 1(d) (the "Escrow Agreement"). Purchaser
shall have the option, at any time, to provide
substitute collateral to Sellers and obtain the
release of the shares from the Escrow Agent;
provided, however, that such substitute collateral
shall be reasonably acceptable to Sellers.
2. Closing Transactions.
(a) Section 2(c)(ii) with respect to closing deliveries
by Purchaser is amended to read as follows:
(A) the Closing Payment, Term Note and Indemnity
Note as required under Paragraph 2(b) above;
(B) the certificates, agreements, opinion and
other instruments required to be delivered by
Purchaser hereunder;
(C) the Pledge and Security Agreement,
accompanied by stock powers duly executed in
blank, covering all shares of capital stock
of Seller held by Purchaser; and
(D) all of Purchaser's schedules and exhibits
listed herein.
(b) Section 2(c)(iv) with respect to the delivery of the
Escrow Agreement is hereby amended to read as follows:
(iv) Purchaser, Sellers and the Escrow Agent shall enter
into the Escrow Agreement and Purchaser shall deliver
to the Escrow Agent the stock and stock powers
required under Paragraph 2(b)(iv) above.
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3. Post-Closing Purchase Price Adjustment.
(a) Section 3(a) with respect to the Closing Net Book
Value is hereby amended as follows:
(i) The definition of Closing Financial Statements is
hereby amended to mean audited financial statements
for the Company as of November 30, 1995, and the
definition of Closing Net Book Value is hereby
amended to mean the net book value of the Company as
of November 30, 1995.
(b) Section 3(c)(ii) with respect to Purchase Price
Adjustments is hereby amended to read as follows:
(ii) Within five days after the determination of the
Purchase Price adjustments, if any, required by
Paragraph 3(c)(i), the Purchase Price shall be
adjusted as follows:
(A) If there is a Purchase Price
Increase, the Term Note shall be
increased in an amount equal to the
Purchase Price Increase;
(B) If there is a Purchase Price
Decrease, the Term Note shall be
decreased in an amount equal to the
Purchase Price Decrease. If the
Purchase Price Decrease exceeds the
amount of the Term Note, then
Sellers shall immediately pay to
Purchaser the excess of the Purchase
Price Decrease over the amount of
the Term Note.
(c) Section 3(c)(iii) with respect to Purchase Price
Adjustments is hereby renumbered as Section 3(c)(iv) and a new Section
3(c)(iii) is hereby created to read as follows:
(iii) In the event that, prior to the Closing Financial
Statements and the Closing Net Book Value becoming
final, binding and conclusive as set forth above,
Sellers are able to arrange a release (the "Release")
of the Company from any and all liabilities to the
Employer's Self Insurers Fund ("Fund"), the Purchase
Price shall be adjusted increasing the Purchase Price
in the amount of $235,000. To reflect that increase,
the Indemnity Note will also be increased by
$235,000.
(iv) In the event that the Sellers are unable to arrange a
Release, on November 30, 1998, the Purchase Price
shall be adjusted by the difference between $235,000
and the total amount of worker's compensation claims,
with an occurrence date prior to December 1, 1995,
actually paid by the Company during the period from
November 30, 1995 through November 30, 1998
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as shown on the reports prepared by the worker's compensation
administrator of the Employer's Self Insurers Fund (the "Final Claims
Liability"). If the Final Claims Liability is greater than $235,000,
within five days after the determination of the Final Claims Liability
the Sellers' shall pay to Purchaser, in cash, the amount of that
difference. If the Final Claims Liability is less than $235,000,
within five days after the determination of the Final Claims Liability
the Purchaser shall pay to Sellers', in cash, the amount of the
difference.
4. Representations, Warranties and Covenants of Sellers.
Section 6(c) with respect to the legal authority of Sellers is hereby amended
as follows:
(c) Legal Authority, Binding Effect. Sellers and the
Company have, and will on the Closing Date have, full
legal right, power and authority to execute, deliver
and perform this Agreement, the Escrow Agreement, the
Lease Agreement, the Noncompetition Agreement and the
Consulting Agreement, and all other writings, spousal
and other waivers and consents relating hereto
(collectively the "Closing Documents") to be signed
by the Sellers and/or the Company, and to consummate
the transactions contemplated hereunder and
thereunder, including selling and transferring the
Shares to Purchaser. This Agreement does, and when
executed by the Sellers and/or the Company, the other
Closing Documents shall, constitute legal, valid and
binding obligations of the Sellers and the Company
and such other respective parties, enforceable in
accordance with their respective terms.
5. Escrow. Section 8 with respect to the Escrow Funds is hereby
amended as follows:
Contemporaneously with the Closing hereunder and
pursuant to Paragraph 2(b)(iv) hereof, Purchaser shall cause
to be deposited into escrow with the Escrow Agent all shares
of capital stock of the Company held by Purchaser. The Escrow
Agent shall serve as trustee over such shares in accordance
with the Escrow Agreement (the "Escrow Agreement"). The
Escrow Agent shall be authorized to release the shares only
pursuant to and in accordance with the Escrow Agreement and
the term hereof.
6. Guaranty of Receivables.
(a) Section 11(c)(i) with respect to the Seller's
guaranty of receivables is hereby amended as follows:
(i) For purposes of this Paragraph, the "Guaranteed
Receivables" means all accounts, notes and other
receivables of the Company recorded on the
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balance sheet contained in the Financial Statements (before any
reserves therefor reflected on such balance sheet and without giving
effect to any write-off of such receivables after August 31, 1995) and
the gross amount (before any reserves therefor and write-offs) of all
accounts, notes and other receivables of the Company acquired or
arising after August 31, 1995 and through November 30, 1995 (whether
or not written off by the Company prior to November 30, 1995), but
excluding all receivables from officers of the Company, which shall be
paid in full at the Closing.
(b) Section 11(c)(iii) with respect to the Seller's
guaranty of receivables is hereby amended as follows:
(iii) Purchaser shall have the right to assign to Sellers,
without recourse, any Guaranteed Receivables which
remain unpaid as of March 30, 1996, such assignment
to be made at any time thereafter and Sellers jointly
and severally shall pay to Purchaser in cash the face
amount of such assigned Guaranteed Receivables within
10 days of a written notice to Sellers specifying the
accounts and amounts involved. At Purchaser's option
in lieu of cash payment by Sellers as provided for in
the preceding sentence, Purchaser may offset the
amount of such uncollectible Guaranteed Receivables
against the Term Note.
(c) Section 11(c)(iv) is hereby deleted in its entirety.
7. Bank Loans. Section 4(n) is hereby deleted in its
entirety.
8. Tax Matters.
(a) Section 12(e)(iii) with respect to tax matters is
hereby amended as follows:
(iii) If in any dispute with a taxing authority relating to
the Company, the taxing authority is clearly willing
to settle such dispute and so indicates unequivocally
in writing on a basis acceptable to Sellers, but
unacceptable to Purchaser, then Sellers may elect to
pay Purchaser the cost of such settlement, including
taxes that are the responsibility of Sellers
hereunder based on such settlement and, thereafter,
Sellers shall be relieved of further cost of such
proceedings, including any taxes, attorneys' and
accountants' fees or other costs of proceeding with
the dispute nor shall they be entitled to any
reduction in taxes resulting from Purchaser's
pursuance of such proposed settlement; provided,
however, that if such resolution could have the
effect of increasing the tax liabilities of, or
attributable to, the Company in a Post-Closing Period
and Sellers have not agreed to indemnify Purchaser
fully for such increase, Sellers shall afford
Purchaser the opportunity to control jointly the
conduct and resolution of
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the portion of such tax proceeding that could have the effect of
increasing the tax liabilities of, or attributable to, the Company in
a Post-Closing Period.
9. Indemnification of Purchaser.
(a) The second paragraph of Section 14 with respect to
the Sellers' indemnification of Purchaser is hereby amended as follows:
Sellers' indemnity of Purchaser hereunder shall be
treated as an adjustment to the Purchase Price and payable
first by a reduction in the principal amount of the Term Note,
to the extent that the balance of the Term Note exceeds any
such adjustment amounts, and then by a reduction from the
Indemnity Note, to the extent that the balance of the
Indemnity Note exceeds any such adjustment amounts; provided,
that if both the Term Note and the Indemnity Note are
insufficient or unavailable to satisfy Sellers' obligations to
Purchaser pursuant to this indemnity, Purchaser shall be
entitled to enforce such indemnity rights in an action at law
and the existence of the Term Note and the Indemnity Note
shall in no way limit, impair or preclude Purchaser's right to
enforce Sellers' obligations under this indemnity in any such
action.
10. Rules Regarding Indemnification.
(a) Section 16(b)(vii) with respect to the rules
regarding indemnification is hereby amended as follows:
(vii) Except as otherwise provided herein, all adjustments
to the Purchase Price under Paragraph 14 shall be
satisfied first by reducing the balance of the Term
Note and then by reducing the balance of the
Indemnity Note. If and when the Term Note and the
Indemnity Note shall have been reduced to zero, the
Purchaser may, in its sole discretion, next claim
against the amounts remaining unpaid under the
Consulting Agreement and, thereafter, the Sellers
shall reimburse the Purchaser for any remaining
Purchase Price adjustment up to the full amount of
the Purchase Price; provided, however, that the
limitations in this Paragraph 16(b)(vii) shall in no
way be construed to limit any remedy the Purchaser
may have against the Sellers or any other person for
fraud, willful misconduct or any other intentional
misrepresentation.
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IN WITNESS WHEREOF, on the date first above written, the
parties have duly executed this Amendment.
PURCHASER:
H.C. INVESTMENTS, INC.
By:
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Xxxxxxx X. Xxxxxxxx, President
ABLE:
ABLE TELCOM HOLDING CORPORATION
By:
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Xxxxxxx X. Xxxxxxxx, President
SELLERS:
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X.X. Xxxxxxx
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Xxxx X. Xxxxxxx
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