EXHIBIT 10.1
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ASSET PURCHASE AGREEMENT
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BETWEEN: Western Power & Equipment Corp.,
an Oregon corporation ("Western")
AND: Yukon Equipment, Inc.
an Alaska corporation ("Buyer")
DATE: May 17, 2007
RECITALS
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A. Western is the owner and operator of construction equipment sales, service,
and leasing operations in Anchorage and Fairbanks, Alaska (the "Retail
Operations"); and
B. Buyer desires to purchase from Western certain of the assets relating to the
Retail Operations, and Western is willing to sell such assets to Buyer all under
the terms and conditions below.
AGREEMENT
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ARTICLE 1. DEFINITIONS
SECTION 1.01 "Affiliate" shall mean any Person that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with the Person specified.
SECTION 1.02 "Knowledge" with respect to Western shall mean the best
knowledge of Xxxx XxXxxx, President and Xxx Xxxxxx, Vice President of Sales.
SECTION 1.03 "Lien" shall mean any mortgage, pledge, security interest,
lease, lien or other encumbrance of any kind, including without limitation any
conditional sale contract, title retention contract or similar arrangement.
ARTICLE 2. PURCHASE AND SALE
SECTION 2.01 PURCHASE AND SALE OF ASSETS. Buyer purchases from Western,
and Western sells to Buyer, all of the right, title and interest of Western in
the following assets and rights associated with the Retail Operations (the
"Purchased Assets"), which Purchased Assets are more particularly described
below:
(a) Equipment. All items of equipment and attachments set forth on
EXHIBIT A ("Equipment").
(b) Parts. All parts set forth on EXHIBIT B ("Parts").
(c) Furniture & Fixtures. All furniture and fixtures set forth on
EXHIBIT C ("F&F").
(d) Shop Tools. Shop equipment, service tools, parts and service
manuals and literature set forth on EXHIBIT D ("Shop Tools").
(e) Vehicles. All vehicles set forth on EXHIBIT E ("Vehicles").
(f) Office and Shop Supplies. All office and shop supplies EXCEPT
items imprinted with Western's logo (such as letterhead, order
forms, and similar items).
(g) Signage. All existing signage at the Retail Operations
("Signage").
(h) Computer Equipment. All computer equipment set forth on EXHIBIT F
("Computers").
(i) Service and Parts Manuals. All service and parts manuals and
literature currently at the Retail Operations.
(j) Leasehold Improvements. All leasehold improvements currently at
the Retail Operations.
(k) Service Work-in-Process. All service work-in-process as of the
date of closing.
(l) Assumed Business Name. All rights to the dba/tradename of Yukon
Equipment.
SECTION 2.02 EXCLUDED ASSETS. The assets of Western being sold,
transferred, assigned, and delivered to Buyer shall include only those Purchased
Assets described in Section 2.01. Such Purchased Assets shall not, however,
include any of the following assets or properties of Western:
(a) Cash and cash equivalents on hand or in banks as of the closing
date;
(b) All accounts receivable as of the closing date;
(c) All certificates of deposit and other forms of security or bid
deposits held by third-parties;
(d) Prepaid taxes, insurance, and other expenses and credits, refunds
and receivables of such items.
(e) Any other assets not specifically described in Section 2.01.
For purposes of this Agreement, all of the property, assets, and rights retained
by Western under this Section 2.02 are collectively referred to as the "Excluded
Assets."
SECTION 2.03 PURCHASE PRICE.
(a) The purchase price for the Purchased Assets ("Purchase Price") is
as follows:
(1) Equipment. The purchase price for the Equipment, as set forth
on EXHIBIT A attached hereto, is a total of $10,759,274.31;
consisting of $7,387,320.38 for new equipment, $249,953.31
for used equipment, and $3,122,000.62 for rental equipment.
Terms are cash, debt assumption as set forth on EXHIBIT A-1,
and/or dealer transfer as of the date of closing set forth
above.
(2) Parts. The purchase price for the Parts, as set forth on
EXHIBIT B attached hereto, is $647,295.10. Terms are cash
and/or dealer transfer as of the date of closing set forth
above.
(3) Furniture & Fixtures. The purchase price for the Furniture &
Fixtures, as set forth on EXHIBIT C attached hereto, shall be
$52,409.25. Terms are cash at closing.
(4) Shop Tools. The purchase price for the Shop Tools, as set
forth on EXHIBIT D attached hereto, shall be $81,881.08.
Terms are cash at closing.
(5) Vehicles. The purchase price for the Vehicles, as set forth
on EXHIBIT E attached hereto, shall be $80,000.00. Terms are
cash at closing.
(6) Office and Shop Supplies. The purchase price for the Office
and Shop Supplies, as set forth above, shall be $3,000.00
payable in cash at closing.
(7) Signage. The purchase price for the Signage, as set forth
above, shall be $5,000.00 payable in cash at closing.
(8) Computers. The purchase price for the Computers, as set forth
on EXHIBIT F attached hereto, shall be $11,315,25 payable in
cash at closing.
(9) Service and Parts Manuals. The purchase price for the Service
and Parts Manuals, as set forth above, shall be $5,000.00
payable in cash at closing.
(10) Leasehold Improvements. The purchase price for the Leasehold
Improvements, as set forth above, shall be $-0- payable in
cash at closing.
(11) Service Work-In-Process. The purchase price for the Service
Work-In-Process, as set forth above, shall be $32,764.70
payable in cash at closing. Except as otherwise provided in
section 7.02, Buyer will assume all of Western's future
liabilities and obligations to perform machine warranty work
for a prepaid fee of $30,000 which fee to be credited against
the purchase price at closing.
(12) Prepaid Items. All prepaids expenses, taxes, purchases, and
deposits shall be prorated between Buyer and Western as of
the date of close. At closing, Buyer shall reimburse Western
for that portion of such prepaid items that are properly
allocated to the Retail Operations after the date of closing.
(b) The Purchase Price for all assets specified above is payable in
full in cash at closing and/or dealer transfer at closing as set
forth above. In the event that Case Corp. does not authorize any
dealer transfer set forth above, in whole or in part, Buyer shall
remit such amount to Western in cash within 5 days of Western's
request to Buyer.
SECTION 2.04 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be
allocated in the manner set forth in Sections 2.03 and 2.05.
SECTION 2.05 GOODWILL. In addition to the above Purchase Price, Buyer
shall pay for all of Western's goodwill and going concern value for the Retail
Operations. The Goodwill value for the Retail Operations is agreed to be
$500,000 payable in accordance with the terms of a Promissory Note in the form
attached as EXHIBIT G. However, Buyer is not purchasing and will not obtain any
right to use Western's tradenames or trademarks.
ARTICLE 3. DELIVERIES
SECTION 3.01 DELIVERIES BY WESTERN. Western has delivered to Buyer
the following:
(a) An executed and acknowledged xxxx of sale form and substance as
necessary to transfer to Buyer all of Western's right, title, and
interest in and to the Purchased Assets; and
(b) The other documents, instruments, and writings required to be
delivered by Western pursuant to this Agreement or otherwise
required in connection herewith.
SECTION 3.02 DELIVERIES BY BUYER. Buyer has delivered to Western the
following:
(a) The amount of the Purchase Price and any other amounts due under
this Agreement;
(b) Fully executed Promissory Note for Goodwill;
(c) Duly executed and effective assumptions of lease for both the
Anchorage, AK facility and the Fairbanks, AK facility; and
(d) Any other documents, instruments and writings required to be
delivered by Buyer pursuant to this Agreement or otherwise
required in connection herewith.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF WESTERN. Western represents and
warrants to Buyer as set forth below:
SECTION 4.01 ORGANIZATION AND QUALIFICATION. Western is a corporation
validly existing and in good standing under the laws of the State of Oregon and
is duly qualified to conduct business in the State of Alaska.
SECTION 4.02 AUTHORITY RELATIVE TO THIS AGREEMENT. Western has the
requisite corporate power to execute and deliver this Agreement and the related
agreements contemplated hereby to which it is a party and to consummate the
transactions contemplated thereby. This Agreement and the related agreements
contemplated hereby to which Western is a party have been duly executed and
delivered by Western and constitute legal, valid, and binding obligations of
Western and are enforceable against Western in accordance with their terms
subject to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws affecting creditors' rights
and remedies generally and to the effect of general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or in
equity).
SECTION 4.03 OWNERSHIP OF PURCHASED ASSETS. Western has title to the
tangible and intangible personal property included in the Purchased Assets
sufficient for the conduct of the Retail Operations as currently conducted by
Western.
SECTION 4.04 ACCURACY OF INFORMATION. To the Knowledge of Western, all
information contained in this Agreement and all exhibit to this Agreement,
including descriptions of the
Purchased Assets, price information, and information on the schedules to such
exhibits and to the Agreement, is true and correct.
SECTION 4.05 USE OF COMPUTER SYSTEM AND SOFTWARE. In connection with
Buyer's purchase of the Retail Operations, Buyer has requested that after the
close of such purchase the Buyer be allowed to continue to use Western's
computer system and software until such time as Buyer has its own system and
software operational. Western agrees to allow such access and provide ongoing
support of Buyer's use of Western's system under the following terms and
conditions:
(a) Buyer shall pay Western $2,500 per month (or such other sum as may
be agreed between Buyer and Western in writing) for access to and
use of Western's computer system and software. Such amount shall
be paid by the first of each month for each month that Buyer uses
Western's system. The first and last months' fees shall be
prorated for the actual portion of the month Buyer had access to
Western's system.
(b) All third-party charges for use of the system and software
including, without limitation, database creation and maintenance
fees, programming and software changes, set-up, data input, file
conversion, and similar fees and expenses incurred by Western
shall be reimbursed by Buyer to Western upon Western's request.
(c) Western shall not be held responsible or liable for system or
software problems or errors.
(d) Buyer will be solely responsible for acquiring and setting up a
new system for Buyer's use and to pay all fees and expenses
related thereto including, but not limited to, set-up, date input,
file conversion, database creation and transfer, user access, and
maintenance.
(e) Western shall provide routine ongoing support of Western's system
and Buyer's use of such system. Western will not provide training
or other non-routine support.
(f) Buyer acknowledges receipt of the outline of issues to be
considered in using Western's systems and in establishing Buyer's
own system attached as EXHIBIT 4.05.
(g) Buyer agrees to reimburse Western for all regular dataline access
fees for the Retail Operations while Buyer is using Western's
system. These fees vary somewhat but are approximately $780 per
month for Anchorage and $830 per month for Fairbanks.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
warrants to Western as set forth below.
SECTION 5.01 ORGANIZATION AND QUALIFICATION. Buyer is a corporation
validly existing and in good standing under the laws of the State of Alaska.
SECTION 5.02 AUTHORITY RELATIVE TO THIS AGREEMENT. Buyer has the
requisite corporate power to execute and deliver this Agreement and the related
agreements contemplated hereby to which it is a party and to consummate the
transactions contemplated thereby. This Agreement and the related agreements
contemplated hereby to which Buyer is a party have been duly executed and
delivered by Buyer and constitute legal, valid, and binding obligations of Buyer
and are enforceable against Buyer in accordance with their terms subject to the
effect of any applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium, or similar laws affecting creditors' rights and remedies
generally and to the effect of general principles of equity (regardless of
whether enforcement is considered in a proceeding at law or in equity).
SECTION 5.03 FINANCING. Buyer has sufficient funds or committed lines
of credit to consummate the transactions contemplated by this Agreement.
SECTION 5.04 INSPECTION OF PURCHASED ASSETS. Buyer has inspected to its
complete satisfaction the physical condition of the Purchased Assets.
SECTION 5.05 BANKRUPTCY. Buyer is not, and has not within the past six
years been, the subject of a bankruptcy or insolvency proceeding, nor is Buyer
subject to any Lien that might adversely affect Buyer's ability to perform its
obligations as contemplated by this Agreement.
SECTION 5.06 TAXES AND FEES. Buyer shall be responsible for and pay all
taxes and fees applicable to this transaction including, but not limited to,
sales taxes, use taxes, transfer taxes/fees, and registration fees.
SECTION 5.07 EMPLOYER IDENTIFICATION NUMBER. Buyer's federal employer
identification number is 00-0000000.
SECTION 5.08 ASSUMPTION OF LEASES. Buyer will take all actions required
to assume all real property and personal property leases for the Retail
Operations.
SECTION 5.09 REPLACEMENT OF SECURITY DEPOSITS. Buyer will take all
actions required to replace all existing prepayments, security deposits, and bid
deposits held by customers and vendors ("Deposits") and refund all Deposits to
Western at closing. Deposits are listed on attached as EXHIBIT H.
ARTICLE 6. ADDITIONAL COVENANTS OF THE PARTIES
SECTION 6.01 FURTHER ASSURANCES. Each party will use reasonable efforts
to take, or cause to be taken, all action, and to do, or cause to be done, all
things necessary, proper, or advisable to carry out all of its respective
obligations under this Agreement and to consummate and make effective the
purchase and sale of the Purchased Assets and the assumption of the real
property leases pursuant to this Agreement. Each party shall, and shall cause
its Affiliates to,
execute, acknowledge, and deliver all such further conveyances, notices,
assumptions, releases, and acquittances and such other instruments, and shall
take such further actions, as may be necessary or appropriate more fully to
assure to Buyer and their successors or permitted assigns, all of the
properties, rights, titles, interests, estates, remedies, powers, and privileges
intended to be conveyed to Buyer pursuant to this Agreement and more fully to
assure to Western and its Affiliates and their successors and assigns the
assumption of the liabilities and obligations intended to be assumed by Buyer
pursuant to this Agreement, respectively.
SECTION 6.02 ASSIGNMENT OF CONTRACTS. Buyer agrees to assume all
liabilities for the leases specified on attached EXHIBIT 6.02. To the extent any
lease, contract, right, or commitment included in the Purchased Assets is not
capable of being assigned, transferred, subleased, or sublicensed without the
consent or waiver of the issuer thereof, the other party thereto, or any third
party (including a government or governmental unit), or if such assignment,
transfer, sublease, or sublicense or attempted assignment, transfer, sublease or
sublicense would constitute a breach thereof or a violation of any law, decree,
order, regulation, or other governmental edict, this Agreement shall not
constitute an assignment, transfer, sublease, or sublicense thereof, or an
attempted assignment, transfer, sublease or sublicense of any such lease,
contract, right, or commitment. Anything in this Agreement to the contrary
notwithstanding, Western is not obligated to transfer to Buyer any of its rights
and obligations in and to any such contract, lease, right, or commitment without
first having obtained all necessary consents and waivers.
SECTION 6.03 PRESERVATION OF RECORDS. Except for tax records, Buyer
shall preserve and keep (or cause to be preserved and kept) the books and
records conveyed pursuant to this Agreement, and Western shall preserve and keep
(or cause to be preserved and kept) such books and records as it or any of its
Affiliates shall retain with respect to the Purchased Assets, for a period of
three years after the date of this Agreement, and Buyer and Western shall each
grant to the other reasonable access to such books and records retained by them
during such period. In the event either Buyer or Western wishes to destroy such
records after such period, it shall first give written notice to the other party
and the other party shall have the right at its option, upon prior written
notice given to the party providing the initial notice, to take possession of
said records as promptly as practicable, but in any event within 180 days after
the date of its notice requesting the same.
SECTION 6.04 RISK OF LOSS. Buyer assumes all risk of loss from all
causes with respect to the Purchased Assets from and after the date of this
Agreement.
SECTION 6.05 CERTAIN PERSONNEL MATTERS.
(a) Compensation of and any bonuses for all employees hired by Buyer
for all periods of employment subsequent to the date of this
Agreement shall be borne and paid for by Buyer. All vacation, sick
day, commissions, and holiday pay of all employees of the Retail
Operations that have accrued or were earned prior to the date of
this Agreement shall be the sole responsibility of Western and
shall be paid in full prior to the date of this Agreement or
accrued on the books of Western and remitted to the employee at
the time of such payments are due to the employees. Buyer shall be
responsible for all vacation, sick day, commissions, and holiday
pay of all employees of the Retail Operations that accrue or are
earned after the date of closing.
(b) Western shall be solely liable and responsible for obligations
under any and all deferred compensation, pension, profit sharing,
retirement, group insurance, or other employee benefit or welfare
plans, written or oral, relating to employees of the Retail
Operations, whether or not constituting an "employee benefit plan"
under the Employee Retirement Income Security Act of 1974, as
amended, that have accrued through and including the date of this
Agreement. Buyer shall be solely liable and responsible for such
obligations from the date of this Agreement.
SECTION 6.06 BUSINESS CUTOFF. Commencing as of the day following the
date of this Agreement (i) all sales of new, used, and allied machinery and
attachments, parts and service shall be deemed to have been conducted for the
account of Buyer and (ii) all obligations for the following shall be deemed to
have been for the account of Buyer: sales commissions, travel, and entertainment
expenses, purchases of parts, machinery, and attachments and shop and office
supplies, shipping costs and costs of outside labor and materials incurred in
connection with the Retail Operations.
SECTION 6.07. CONSENT OF CASE CREDIT CORPORATION AND CASE CORPORATION.
Buyer acknowledges that Western's agreements with Case Credit Corporation and
Case Corporation ("Case") require that Western obtain the consent of Case to the
sale transaction described in this agreement, and that such consent is the
responsibility of Buyer.
SECTION 6.08. ALLOCATION OF ENVIRONMENTAL RESPONSIBILITY. The Buyer
acknowledges that Western is conducting Phase One environmental surveys for the
Retail Operations. Seller shall provide copies of the surveys upon their
completion. Buyer agrees to assume the risk and liability for all environmental
claims related to the Retail Operations occurring on and after the date of
closing. Western shall be liable for all environmental claims related to the
Retail Operations arising before the date of closing.
ARTICLE 7. INDEMNIFICATION AND LIMITATIONS ON LIABILITY
SECTION 7.01 DEFINITIONS. As used in this Article, the following terms
shall have the meanings set forth below:
(a) Losses. The term "Loss" or "Losses" shall mean any and all direct
or indirect payments, assessments, liabilities, costs and expenses
paid or incurred (whether or not known or asserted prior to the
date hereof, fixed or unfixed, conditional or unconditional,
xxxxxx or inchoate, liquidated or unliquidated, secured or
unsecured, accrued, absolute, contingent or otherwise), including
without limitation penalties, interest on any amount payable to an
unaffiliated party as a result of the foregoing and, subject to
Section 7.05 hereof, any legal or other expenses reasonably
incurred in connection with investigating or defending any
Third-Party Claims, whether or not resulting in any liability, and
all amounts paid in respect of claims or actions in accordance
with Section 7.05 hereof; provided,
however, that Losses shall not include any loss of profit or
anticipated profit and shall be net of any insurance proceeds
received by an Indemnitee from a nonaffiliated insurance company
on account of such Losses (after deducting any direct costs
incurred in obtaining such proceeds); provided, further, however,
that nothing in this Article shall require an Indemnitee to
proceed against its insurance carrier.
(b) Third-Party Claims. The term "Third-Party Claims" shall mean any
claims, actions or rights asserted against an Indemnitee by a
party that is not the Indemnitor and is not an Affiliate of the
Indemnitee, including without limitation, claims by governmental
authorities.
(c) Indemnitee. The term "Indemnitee" shall mean any Person that may
be entitled to seek indemnification pursuant to the provisions of
Section 7.02 or Section 7.03 hereof.
(d) Indemnitor. The term "Indemnitor" shall mean any Person that may
be obligated to provide indemnification pursuant to Section 7.02
or Section 7.03 hereof.
(e) Specified Officer. With respect to any particular matter, the term
"Specified Officer," as applied to any corporation, shall mean the
chairman, president, general counsel, any vice president, or
secretary of such corporation, or the manager of any plant or
other facility of such corporation, or any other employee or agent
of such corporation (who may report, directly or indirectly, to
such person) having responsibility for an operational or staff
function who in the normal course of such officer's, manager's or
other person's responsibility would reasonably be expected to have
knowledge of such matter.
(f) Notice Period--Third-Party Claims. The term "Notice Period," as
applied to any Third-Party Claim for which an Indemnitee seeks to
be indemnified pursuant to this Article, shall mean the period
ending the earlier of the following:
(1) Three months after the time at which any Specified Officer of
the Indemnitee (or the Indemnitee, if the Indemnitee is an
individual) has received actual notice of such Third-Party
Claim.
(2) With respect to any Third-Party Claim that has become the
subject of proceedings before any court or tribunal, such
time as would allow the Indemnitor sufficient time to
contest, on the assumption that there is an arguable defense
to such Third-Party Claim, such proceeding prior to any
judgment or decision thereon.
(3) With respect to any Third-Party Claim that the Indemnitee
proposes to pay or settle, such time as would provide the
Indemnitor sufficient time
prior to such payment or settlement to determine whether to
contest such claim and assume the defense pursuant to
Section 7.05.
(4) The time period under which a Claim Notice must be given as
set forth in Section 7.06.
(g) Claim Notice. The term "Claim Notice" shall have the meaning set
forth in Section 7.04.
SECTION 7.02 INDEMNITY BY WESTERN. Subject to Section 7.09, Western
shall, to the fullest extent permitted by law, defend and hold harmless Buyer
and their Affiliates, including the directors, officers, employees, agents and
representatives of each of them (each of whom may be an Indemnitee pursuant to
this section), from and against the following:
(a) Breach. All Losses arising from the breach by Western in any
material respect of any of its covenants or representations set
forth in this Agreement.
(b) Liabilities. All Losses relating to the ownership or operation of
the Retail Operations prior to the date of this Agreement.
SECTION 7.03 INDEMNITY BY BUYER. Buyer shall, to the fullest extent
permitted by law, defend and hold harmless Western and its Affiliates, including
the current and former directors, officers, employees, agents, and
representatives of each of them (each of whom may be an Indemnitee pursuant to
this section), from and against the following:
(a) Liabilities. All Losses (other than Losses for which Western is
obligated to indemnify Buyer pursuant to Section 7.02) relating to
or arising from the ownership, operation, occupancy, construction,
condition (including without limitation environmental conditions)
or use of the Purchased Assets or the Real Property or operation
of a dealership, to the extent such Losses relate to, arise from
or are associated with any period after the date of this Agreement
and whether arising from the negligence or gross negligence of
Western or any of its Affiliates or otherwise.
(b) Breach. All Losses arising from the breach by Buyer in any
material respect of any of their covenants or representations set
forth in this Agreement.
SECTION 7.04 NOTIFICATION OF THIRD-PARTY CLAIMS. In no case shall any
Indemnitor under this Agreement be liable with respect to any Third-Party Claim
against any Indemnitee unless the Indemnitee shall have delivered to the
Indemnitor within the Notice Period a notice ("Claim Notice") describing in
reasonable detail the facts giving rise to such Third-Party Claim and stating
that the Indemnitee intends to seek indemnification for such Third-Party Claim
from the Indemnitor pursuant to this Article.
SECTION 7.05 DEFENSE OF CLAIMS. Upon receipt of a Claim Notice from an
Indemnitee with respect to any Third-Party Claim, the Indemnitor may assume the
defense thereof with counsel reasonably satisfactory to such Indemnitee and the
Indemnitee shall cooperate in all
reasonable respects in such defense. The Indemnitee shall have the right to
employ separate counsel in any action or claim and to participate in the defense
thereof, provided that the fees and expenses of counsel employed by the
Indemnitee shall be at the expense of the Indemnitor only if such counsel is
retained pursuant to the second succeeding sentence or if the employment of such
counsel has been specifically authorized by the Indemnitor. The Indemnitor may
conduct such defense in the name of or on behalf of the Indemnitee or Indemnitor
and shall have full authority and control with respect thereto, including the
settlement thereof. If the Indemnitor does not notify the Indemnitee within 60
days after receipt of the Claim Notice that it elects to undertake the defense
thereof, the Indemnitee shall have the right to defend at the expense of the
Indemnitor the claim with counsel of its choosing, subject to the right of the
Indemnitor to assume the defense of any claim at any time prior to settlement or
final determination thereof. In such event, the Indemnitee shall send a written
notice to the Indemnitor of any proposed settlement of any claim, which
settlement the Indemnitor may reject, in its reasonable judgment, within 30 days
after receipt of such notice. Failure to reject such settlement within such
30-day period shall be deemed an acceptance of such settlement. In the event the
Indemnitor rejects such settlement, the Indemnitee shall have the right to
settle the claim over the objection of the Indemnitor, unless the Indemnitor
assumes the defense from the Indemnitee upon rejecting the settlement.
SECTION 7.06 NOTICE OF OTHER CLAIMS. In the event any Indemnitee should
have a claim against any Indemnitor under or in connection with this Agreement
that does not involve a Third-Party Claim, the Indemnitee shall notify the
Indemnitor of such claim, specifying the nature of and specific basis for such
claim and the amount of such claim, with reasonable promptness, but in no event
later than when notice thereof is required to be made pursuant to this Article.
The Indemnitor shall remit payment for the amount of such claim upon receipt of
an invoice therefor, or in the event of a dispute, the Indemnitee and the
Indemnitor shall proceed in good faith to negotiate a resolution of such
dispute, and if not resolved through negotiations, such dispute will be resolved
by litigation in an appropriate court of competent jurisdiction.
SECTION 7.07 ACCESS AND COOPERATION. Western and Buyer shall each
cooperate fully with the other as to all claims made under this Agreement, shall
make available to the other as reasonably requested all information, records and
documents relating to all such claims and shall preserve all such information,
records and documents until the termination of any such claim. Western and Buyer
also shall each make available to the other, as reasonably requested and subject
to availability, its personnel (including technical and scientific), agents and
other representatives who are responsible for preparing or maintaining
information, records or other documents, or who may have particular knowledge
with respect to any such claim.
SECTION 7.08 NO INSURANCE. The indemnifications provided for in this
Article shall not be construed as a form of insurance and shall be binding upon
and inure to the benefit of Western and Buyer and their respective Affiliates,
successors and permitted assigns. Western and Buyer hereby waive for themselves,
their Affiliates, successors and permitted assigns, including without limitation
any insurers, any rights to subrogation for Losses arising from claims for which
each of them is respectively liable or against which each respectively
indemnifies the other, and, if necessary, Western and Buyer shall obtain waiver
of such subrogation from their respective insurers.
SECTION 7.09 LIMITATIONS ON LIABILITIES.
(a) Limitation on Liability.
(1) Western's obligations for any claim relating to any
Environmental Law, Hazardous Materials, or other
environmental matter shall arise only under Section 7.02(b).
(2) Western shall have no liability for any Indemnifiable Loss,
and Buyer shall have no liability for any claim for
indemnification under Section 7.03, unless a Claim Notice or
other notice has been delivered to the other as required by
Section 7.04 or Section 7.06. In addition, and anything
herein to the contrary notwithstanding, Western shall have no
liability for any Indemnifiable Loss, and Buyer shall have no
liability for any claim for indemnification under Section
7.03, for any breaches of covenants hereunder, unless a Claim
Notice or other notice has been delivered to the other within
one year after performance of the covenant giving rise to
such Indemnifiable Loss or claim for indemnification, as the
case may be, is required under this Agreement. In addition,
and anything herein to the contrary notwithstanding, Western
shall have no liability for any Indemnifiable Loss for any
breaches of representations hereunder unless a Claim Notice
or other notice has been delivered to it within the period
that the representation giving rise to such Indemnifiable
Loss survives as set forth in Article 8.
(b) No Incidental or Consequential Damages. Neither Buyer nor Western
shall be entitled to recover from the other for any Losses any
amount in excess of the actual damages suffered by such party.
Buyer and Western each waive any right to recover punitive,
special, exemplary, incidental and consequential damages.
(c) Maximum Liability. Neither Western nor any of its Affiliates shall
be liable for aggregate Losses (i) in excess of the Purchase
Price, or (ii) for any Losses pertaining to the Real Property in
excess of the purchase price thereof.
(d) Exclusive Remedy. Western and Buyer each hereby acknowledges and
agrees that its sole and exclusive remedy with respect to any and
all claims relating to the representations, warranties, covenants
and agreements contained in this Agreement or other claims
pursuant to or in connection with this Agreement shall be pursuant
to the indemnification provisions set forth in this Article.
(e) No Rescission. No breach of any representation, warranty, covenant
or agreement contained herein shall give rise to any right on the
part of Buyer or Western, as the case may be, after the
consummation of the purchase and sale contemplated hereby, to
rescind this Agreement or any of the transactions contemplated
hereby.
(f) Mitigation. Buyer and Western shall take all reasonable steps to
mitigate all Losses upon and after becoming aware of any event
that could reasonably be expected to give rise to any Losses that
are indemnifiable hereunder.
ARTICLE 8. SURVIVAL. The representations and warranties of Western set forth in
this Agreement and in any certificate or instrument delivered in connection
herewith shall survive for a period of one year following the date of this
Agreement.
ARTICLE 9. BROKERS. Each of the Buyer and Western represent to the other that,
neither of the Buyer nor Western has, directly or indirectly, employed any
broker, finder or intermediary in connection with this Agreement or the
transactions contemplated hereby who might be entitled to a fee or commission
upon the execution of this Agreement or consummation of the transactions
contemplated hereby.
ARTICLE 10. EXPENSES. Except as otherwise specifically provided herein, each
party will bear all legal and other costs and expenses incurred by it.
ARTICLE 11. NOTICES; MISCELLANEOUS
SECTION 11.01 NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or by
facsimile transmission or mailed by registered or certified mail (return receipt
requested), postage prepaid, to the parties at the following addresses (or at
such other address for a party as shall be specified by like notice; provided,
that notices of a change of address shall be effective only upon receipt
thereof):
To Western, as follows: To Buyer, as follows:
Western Power & Equipment Corp. Yukon Equipment, Inc.
0000-X X.X. 000xx Xxxxxx 0000 X. Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Attn: President Attn: President
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
SECTION 11.02 MISCELLANEOUS.
(a) Entire Agreement. This Agreement supersedes all prior agreements
between the parties (written or oral) and, except as aforesaid, is
intended as a complete and exclusive statement of the terms of the
Agreement between the parties. This Agreement may be amended only
by a written instrument duly executed by the parties.
(b) Governing Law; Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Alaska,
without regard to the principles of conflicts of laws of such
state. If any action is brought to enforce or interpret this
agreement, such action shall be brought in a federal district
court of Alaska or any Alaska state court.
(c) Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
(d) Assignability. Neither Buyer nor Western may transfer, assign, or
encumber any of its rights, duties, or obligations under this
Agreement or any part hereof without the prior written consent of
the other party. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted
assigns.
(e) No Third-Party Beneficiaries. Except as otherwise expressly
provided herein, nothing in this Agreement shall entitle Western,
Buyer, or their respective successors and assigns permitted hereby
to any claim, cause of action, remedy, or right of any kind.
(f) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability, but this shall not affect the validity or
enforceability of any of the terms and provisions of this
Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, such provision shall
be interpreted to be only so broad as is enforceable.
(g) Equitable Relief. The parties hereto agree that irreparable damage
would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific
terms or were otherwise breached. Accordingly, it is agreed that
the parties shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the
terms and provisions hereof in any court of the United States or
any state having jurisdiction, this being in addition to any other
remedy at law or in equity.
(h) Counterparts. This Agreement may be executed in any number of
counterparts, no one of which needs to be executed by all the
parties, and this Agreement shall be binding upon all the parties
with the same force and effect as if all the parties had signed
the same document, and each such signed counterpart shall
constitute an original of this Agreement.
(i) Closing. Closing shall occur at the Retail Operations' Anchorage
facility on or before May 4, 2007 or at such other time and place
as the parties may mutually agree to; but in no event shall
closing occur later than May 31, 2007.
Western Power & Equipment Corp., Yukon Equipment, Inc.,
an Oregon corporation an Alaska corporation
By: ___________________________ By: ___________________________
X.X. Xxxxxx Xxxxx Xxxxxxxxx
Vice President of Sales President
