ASSET AND REAL PROPERTY PURCHASE AND SALE AGREEMENT
This Asset and Real Property Purchase and Sale Agreement ("Agreement")
is entered into as of this 6 day of November, 2000, among NEW MEXICO WATER
SERVICE CORPORATION, a New Mexico corporation ("Purchaser"), and RIO GRANDE
UTILITY CORPORATION ("Seller"), with reference to the following recitals:
RECITALS
A. Seller is a public water and wastewater utility ("Utility Systems") regulated
by the New Mexico Public Regulation Commission ("NMPRC"). The Seller's Utility
Systems are located in the area of Rio communities, New Mexico and serve
approximately 2,265 water customers and 1,600 wastewater treatment customers.
B. Purchaser is a wholly owned subsidiary of California Water Service Group
("CWSG"), a publicly traded water and wastewater utility company. CWSG organized
Purchaser to own and to operate water and wastewater utilities in the State of
New Mexico. CWSG has committed to finance and fund Purchasers acquisitions and
operations in the State of New Mexico.
C. Seller and Purchaser believe that the sale of the assets and business
hereunder is in the best interest of the population served by the Seller's
Utility Systems, in view of Purchaser's expertise and financial resources.
D. Closing of the proposed transaction hereunder is conditional upon the
approval of the NMPRC, the New Mexico Environment Department ("NMED") and the
United States Environmental Protection Agency ("EPA").
E. Seller desires to sell to Purchaser and Purchaser desires to purchase from
Seller all of Seller's water and wastewater utility assets, on the terms and
subject to the conditions herein set forth.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals, which shall
be deemed a relevant part of this Agreement, and the mutual covenants, promises,
agreements, representations and warranties contained herein, for good and
valuable consideration, the parties hereto agree as follows:
1. TRANSFER OF ASSETS
1.1 Agreement to Sell. Upon the terms and subject to all of the
conditions contained herein, Seller agrees to sell, assign, transfer and deliver
to Purchaser on the Closing Date (as defined in Section 5.1 hereof), and
Purchaser hereby agrees to purchase and accept from Seller on the Closing Date,
the Acquired Assets (as defined in Section 1.2 hereof). Seller shall deliver to
Purchaser at the Closing appropriate bills of sale, assignments, easements,
deeds and such other documents of conveyance as are necessary and convenient to
effect the transfer of title to the
Acquired Assets to Purchaser on the Closing Date, in form and substance
satisfactory to Purchaser and its counsel.
1.2 Description of Assets. For purposes of this Agreement, the term
"Acquired Assets" shall refer to the assets described in the following:
(a) Utility Systems. All water and wastewater treatment
equipment and facilities, xxxxx, pumping equipment, connections, tanks,
reservoirs, mains, meters and hydrants owned by Seller and described in Schedule
1.2 (a) hereof.
(b) Real Property and Easements. All real property, easements
and other real property rights held or owned by Seller, as described in Schedule
1.2 (b) hereof (the "Real Property").
(c) Water Rights. Fourteen hundred and ninety one (1,491)
acre-feet of ground water rights in the Rio Grande basin, as more particularly
described in Schedule 1.2 (c) hereof (the "Water Rights").
(d) Other Assets. All other tangible assets owned by the
Seller and used in the Seller's business, including but not limited to vehicles,
personal property (office furniture, office and computer equipment, fixtures,
computer software and other tangible property) all rights under contracts, all
claims and all prepaid expenses, and described in Schedule 1.2 (d) hereof.
(e) Inventory. All inventories owned by Seller, including but
not limited to component parts and spare parts and described in Schedule 1.2 (e)
hereof.
(f) Accounts Receivable. All accounts receivable owned by
Seller.
(g) Books and Records. Copies of all books, records, files,
contracts, and other data of Seller relating to Acquired Assets, whether or not
located at 000 Xxxx Xxx Xxxxxxxxxxx Xxxx., Xxxxx, Xxx Xxxxxx, its principal
place of business, and whether or not in tangible form or in the form of
intangible computer storage media, such as disks, tapes, and other similar
storage media.
(h) Licenses. All licenses of Seller described in Schedule
6.22 hereof.
(i) Deposits. All deposits with government agencies, vendors,
contractors and other entities described in Schedule 1.2 (i) hereof. Seller
shall provide such information to third parties holding deposits as is necessary
to transfer Seller's interest in the deposits to Purchaser.
(j) Other Property. All of the interest of Seller in any
intangible property owned by the Seller and used in Seller's business and to the
extent approved by Purchaser in writing pursuant to the provisions of this
Agreement, any and all contracts, warranties, guarantees, agreements, utility
contracts, operating and customer account records, maps and drawings, permits,
franchises, licenses, claims, prepaid expenses, grants, certificates and
privileges and other rights owned by Seller, or in which Seller holds any
beneficial interest, relating to or used in connection
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with the ownership, operation, use, occupancy or enjoyment of all or any part of
the Seller's business all of which are collectively referred to as the "Other
Property". The Other Property shall include, without limitation, all customer
service contracts and all site plans, plans and specifications, "as-built" plans
and drawings, permits and other governmental reviews, approvals and entitlements
related to Utility Systems and such of the foregoing as have been heretofore
prepared, applied for, obtained or otherwise are in the name or possession of,
under the control of or available to Seller. Other Property is set forth in
Schedule 1.2(j).
1.3 Excluded Assets. Any and all assets not to be acquired by the
Purchaser shall be considered "Excluded Assets." These Excluded Assets described
in Schedule 1.3 hereof shall not be considered Acquired Assets.
2. LIABILITIES AND SALES TAXES
2.1 Only Certain Liabilities Being Assumed. Except as described in
Schedule 2.1 hereof, Purchaser will not assume or be obligated to satisfy or
perform any of the liabilities, or commitments, whether fixed or contingent,
which relate to the operation of Seller's business prior to the Closing Date.
2.2 Liabilities Not Being Assumed. Purchaser will not assume or be
obligated to satisfy or perform any other liabilities, obligations or
commitments of Seller, whether fixed or contingent, or known or unknown,
including but not limited to Seller's tax, environmental and water quality
liabilities and obligations to its employees.
2.3 Excise and Property Tax. Seller shall pay all sales, gross
receipts, use and transfer taxes arising out the transfer of the Acquired Assets
and shall pay its portion, prorated as of the Closing Date, of state and local
real and personal property taxes of the business. Purchaser shall not be
responsible for any taxes of any kind related to any period before the Closing
Date.
2.4 Assumption Agreement. Purchaser shall assume only those certain
liabilities as described in Schedule 2.1 in an agreement that is set forth in
Schedule 2.4 attached hereto.
3. PURCHASE PRICE AND PAYMENT THEREFORE; OTHER PAYMENTS.
3.1 Purchase Price. As consideration for the sale, assignment, transfer
and delivery of the Acquired Assets by Seller to Purchaser, and upon the terms
and subject to all of the conditions contained herein, Purchaser agrees to pay
and Seller agrees to accept a cashier's check for $2,300,000.00 (Two Million,
Three-Hundred Thousand and 00/100 Dollars).
3.2 Allocation of Purchase Price. The Purchase Price shall be allocated
among the various categories of Acquired Assets in accordance with Schedule 3.2
hereof.
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4. PROPERTY DESCRIPTION, TITLE BINDER, SURVEY, ENVIRONMENTAL ASSESSMENT
4.1 Property Description, Current Surveys and Title Policies. Within
fifteen (15) days after the date hereof, Seller shall provide to Purchaser
descriptions of the Real Property (the "Property Descriptions"); copies of any
existing surveys and title policies, environmental, soils, engineering and any
other studies relating to the real property in Seller's possession for
Purchaser's review and confirmation of the descriptions and extent of Seller's
ownership.
4.2 Water Rights. Within fifteen (15) days after the date hereof,
Seller shall provide to Purchaser descriptions of the Water Rights including any
and all documents or filings made with the Office of the New Mexico State
Engineer, other state and local agencies or courts. Such documents shall
include, but not be limited to, declarations, permits, licenses or any other
documents evincing the existence and Seller's ownership of the Water Rights.
Within the time set forth herein, Seller also shall provide copies of any
existing water quality studies, test results, well capacity analyses, water use
documents or any other evidence of placement of water to beneficial use and any
other water quality or quantity studies or information pertaining to water used
in Seller's business, including any such documents filed with the Office of the
New Mexico State Engineer or New Mexico Environment Department.
4.3 Title Binder. Within thirty (30) days after the date hereof, Seller
shall cause to be delivered to Purchaser a title binder for an ALTA Owner's
Policy of Title Insurance covering the Property and furnish to Purchaser legible
and true copies of all instruments which are the basis of any exceptions (other
than the standard printed exceptions) (the "Exceptions") referred to therein
(the "Binder"). Standard printed exceptions 8 and 9 (as to current year taxes)
and that portion of standard printed exception 7 which cannot be deleted and the
other exceptions which Purchaser approves or waives in the manner provided
hereafter shall be deemed "Permitted Exceptions".
4.4 Survey. Within thirty (30) days after the Effective Date hereof and
at Seller's expense, Seller shall cause to be delivered to Purchaser surveys
sufficient to allow deletion of the Standard Survey exception from the Owner's
policy of Title insurance to be issued pursuant to this Purchase Agreement (the
"Surveys"). Seller will provide all surveys in its possession, its most recent
plat map of the Real Property and all pipeline, utility and other easements
benefiting the Real Property, and all deeds, agreements and other documents
evidencing such easements. If any additional surveys are deemed necessary by
Purchaser they will be performed at Purchaser's expense; provided that Seller
shall use its best efforts to assist Purchaser in obtaining such additional
surveys. Purchaser may terminate agreement if not satisfied with surveys
provided or which Purchaser deems necessary.
4.5 Environmental Assessment; Water Quality and Quantity Analysis.
Purchaser shall have the right, at its expense, to conduct Phase One and Phase
Two Environmental Assessments of the Real Property following the ASTM standards
for Environmental Assessments. Purchaser shall
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also have the right, at its expense to conduct any other studies of water
quality or quantity that Purchaser deems appropriate.
4.6 Permits; Agency Filings. Within fifteen (15) days after the
Effective Date hereof and at Seller's expense, Seller shall cause to be
delivered to Purchaser any and all permits or licenses Seller holds with the New
Mexico Public Regulation Commission, the New Mexico Environment Department or
EPA. Seller also shall deliver any and all filings made with such agencies,
subsequent case filings made by Seller or third parties, and orders entered, if
any.
4.7 Personal Property Search. Within thirty (30) days after the date
hereof, and at Seller's expense, Seller shall provide a personal property record
search of Seller for any liens or encumbrances on all personal property owned by
Seller and subject to this Agreement (the "UCC Search").
4.8 Review; Correction of Disapproved Items. Purchaser shall have until
the end of the Inspection Period (as defined herein) within which to review the
Binder, the Property Descriptions, the Surveys, the Title Policies, the
Environmental Assessments, the UCC Search and any other studies, investigations
or other matters, whether by Seller or undertaken by Purchaser (collectively
referred to herein as the "Due Diligence Items"). Before the expiration of the
Inspection Period, Purchaser shall indicate in writing any Due Diligence Items
that are not acceptable. Diligence Items not expressly disapproved shall be
deemed approved. Seller shall have thirty (30) days after the end of the
Inspection Period to cure all disapproved Due Diligence Items ("Seller's Cure
Period"). If Seller does not cure the objections within Seller's Cure Period,
Purchaser may at its option either cancel this Agreement or waive the objections
and proceed to Closing.
4.9 Inspection and Investigation. Purchaser and Purchaser's agents and
consultants shall have until sixty (60) days after the Effective Date Hereof
(the "Inspection Period") within which to conduct the inspections,
investigations and reviews provided by this Article 4. Any delay by Seller in
providing the Due Diligence Items shall entitle Purchaser to an equivalent
extension of the Inspection Period. Purchaser shall have the right to enter upon
Seller's property at necessary times for the purpose of inspecting the Real
Property. Except as provided herein, Purchaser shall be responsible for all
inspections, examinations, tests and evaluations.
5. THE CLOSING
5.1 Closing Date. The closing ("Closing") of the transactions
contemplated by this Agreement shall take place at a location mutually agreed
upon by the parties, during regular business hours, on the 5th business day
after the effective date of the NMPRC `s final order granting approval of the
transaction referred to in Section 9.1 or at such other time as the parties may
agree ("Closing Date").
5.2 Seller's Obligations at Closing. At the Closing, upon delivery of
the items specified in Section 4.3 hereof, Seller shall deliver to Purchaser the
Acquired Assets and the documents described in Schedules 1.2(a)-(j) hereof.
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5.3 Purchaser's Obligation at the Closing. At the Closing, Purchaser
shall
a. Deliver to Seller the purchase price specified in Section
3.1 in a form mutually agreeable to the Parties, and
b. Offer all current employees of Seller employment with
Purchaser or an affiliated company of the Purchaser at their current
wages and comparable benefits and fully execute and perform employment
offers with certain employees of Valley Improvement Association, set
forth on Schedule 5.3 hereof,.
6. SELLER'S REPRESENTATIONS AND WARRANTIES
Seller represents and warrants to Purchaser as follows:
6.1 Organization, Good Standing and Qualification. Seller is a
corporation duly organized, validly existing and in good standing under the laws
of the State of New Mexico and has all necessary corporate powers to own, lease
and operate its assets and properties and to carry on its business as now owned
and operated by it. Seller is not doing business in any state other than New
Mexico. Seller does not own, directly or indirectly, any interest or investment
(whether equity or debt) in or control any corporation, partnership, business,
trust, joint venture or other entity.
6.2 Authority. Seller has the full corporate power and authority to
enter into this Agreement and to carry out the transactions contemplated hereby.
The Seller's Board of Directors and Seller's controlling shareholder, Valley
Improvement Association, have duly and effectively approved Seller's execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby and no other corporate proceeding on the part
of Seller is necessary to authorize this Agreement and the transactions that it
contemplates. This Agreement has been duly and validly executed by Seller and is
a valid and binding agreement of Seller enforceable in accordance with its
terms.
6.3 Financial Statements. Seller has delivered to Purchaser the
unaudited balance sheets of Seller as of December 31, 1997, 1998 and 1999 and
the related unaudited statements of income and retained earnings for the years
then ending, certified by the President of Seller. These financial statements
are hereinafter collectively referred to as the "Seller Financial Statements."
To the best of Seller's knowledge, the Seller Financial Statements are true and
correct in all material respects, fairly present the financial position of
Seller as of the respective dates of the balance sheets included in the Seller
Financial Statements, and the results of its operations for the respective
periods indicated.
6.4 Absence of Specified Changes, Claims and Litigation. Except as
described in Schedule 6.4 hereof, since December 31, 1999, there has not been
any:
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(a) Transaction by Seller except in the ordinary course of
business as conducted on that date consistent with past practices;
(b) Capital expenditure by Seller exceeding $5,000;
(c) Obligations incurred by Seller, except trade or business
obligations incurred in the ordinary course of business consistent with past
practices;
(d) Cancellation or compromise of any debt or claim, except in
the ordinary course of business consistent with past practices;
(e) Material adverse change in the financial condition,
liabilities, assets, business, results of operation or prospects of Seller;
(f) Destruction, damage to or loss of any assets of Seller
(whether or not covered by insurance) that materially and adversely affects the
financial condition, business, operations or prospects of Seller;
(g) Sale or transfer of any asset of Seller, except in the
ordinary course of business consistent with past practices;
(h) Execution, creation, amendment or termination of any
contract, agreement or license to which Seller is a party, except in the
ordinary course of business consistent with past practices;
(i) Waiver or release of any right or claim of Seller, except
in the ordinary course of business;
(j) Mortgage, pledge or other encumbrance of any asset of
Seller;
(k) Cancellation or the giving of notice of cancellation of
any policy insuring Seller, its business or assets;
(l) Other event or condition of any character that has or
might reasonably have a material and adverse effect on the financial condition,
assets, business, results of operation or prospects of Seller; or
(m) Agreement by Seller to do any of the things described in
the preceding clauses (a) through (l) except as agreed to in writing by
Purchaser.
6.5 Tax Returns and Audits. Within the times and in the manner
prescribed by law, Seller has filed or caused to be filed all federal, state and
local tax returns required by law and has
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paid all taxes, assessments and penalties due and payable. These tax returns
reflect accurately all liability for taxes of Seller for the periods covered
thereby.
6.6 Real Property Leased to or by Seller. Except as described in
Schedule 6.6 hereof, Seller is not a party to any agreement for the lease of
real property.
6.7 Tangible Personal Property. Except as described in Schedule 6.7
hereof, no personal property used by Seller in connection with its business is
held under any lease, security agreement, conditional sales contract, or other
title retention or security arrangement or is located other than in possession
of Seller. Seller owns all tangible personal property necessary to conduct its
business as now conducted.
6.8 Title to and Condition of Assets and Properties. Seller has sole
and exclusive good and merchantable title to all of the Acquired Assets and all
of its properties and assets reflected in the Seller Financial Statements and
all assets acquired by Seller subsequent to December 31, 1999 (except in each
case those disposed of in the ordinary course of business since December 31,
1999), free and clear of mortgages, liens, pledges, charges, encumbrances,
equities, claims, easements, rights of way, covenants, conditions, or any other
restriction or defect in title, except for the liens of current taxes and
assessments, and easements, rights of way, encumbrances, restrictions, clouds
and defects which do not materially and adversely affect the operations of or
the fair market values of its assets or properties. To the best of Seller's
knowledge and belief, all of Seller's real property, its pipes, xxxxx and water
storage facilities, and all machinery, equipment, fixtures, automobiles, and
other physical assets owned, leased, or used by Seller in the conduct of its
business as presently conducted are in good operating condition and repair,
ordinary wear and tear excepted, and are free from any defects, except (i) such
defects that are correctable through routine maintenance, (ii) such minor
defects that do not materially interfere with the continued use of such property
in the conduct of Seller's normal operations, and (iii) such defects as
described in Schedule 6.8 hereof. No officer, director or employee of Seller,
owns or has any interest, directly or indirectly, in any of the real or personal
property used by Seller in the conduct of its business. Seller does not occupy
any real property in violation of any law, regulation or decree.
6.9 Zoning. As of the date hereof, the zoning of each parcel of real
property owned or used by Seller in the conduct of its operations permits the
presently existing improvements and the continuation of the business presently
being conducted on such parcel. Seller is not aware of any facts or
circumstances which suggest that a change in zoning which would affect the
present use of Seller's real property is likely.
6.10 Business. Seller is engaged in the business of a public utility
water and wastewater company serving the area of Rio Communities, New Mexico in
Valencia County, and with respect to which, it holds a valid certificate of
public convenience and necessity issued by the NMPRC, copies of which will be
delivered to Purchaser by Seller within thirty (30) days after the date hereof
in accordance with Paragraph 4. above.
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6.11 Physical Assets. Except as described in Schedule 6.11 hereof, to
the best of the Seller's knowledge the physical assets of Seller are in sound
operating condition and have been consistently maintained in a manner
appropriate to the purposes to which similar water and wastewater utility system
equipment and improvements would ordinarily be devoted. There are no material
arrears in the maintenance of any such physical assets.
6.12 Litigation. Except as described in Schedule 6.12 hereof, to the
best of Seller's knowledge and belief, there is no action, suit, proceeding,
claim arbitration, or investigation, audit, inquiry or hearing, at law or in
equity, before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, or other
person pending or, to the knowledge of Seller, threatened, against Seller or
relating to or affecting Seller, its business, assets or properties or any basis
for such action, suit, proceeding, claim investigation, audit, inquiry, or
hearing to the knowledge of Seller. Seller is not presently engaged in any legal
action to recover money due it or damages sustained by it.
6.13 NMPRC/Rates. There are no NMPRC proceedings or investigations
pending or, to the knowledge of Seller, threatened against Seller, which might
adversely affect the business or financial condition of Seller or the water or
wastewater rates of Seller presently in effect.
6.14 NMED. There are no NMED proceedings or investigations pending or,
to the knowledge of Seller, threatened against Seller, which might adversely
affect the business or financial condition of Seller.
6.15 EPA. There are no EPA proceedings or investigations pending, or to
the knowledge of Seller, threatened against Seller, which might adversely affect
the business or financial condition of Seller.
6.16 Condemnation. No elections have been held or other actions taken
authorizing the commencement of proceedings toward condemnation of any of the
properties of Seller, and, to the best knowledge of Seller, no such actions have
been proposed.
6.17 Existing Employment Contracts. Seller has no collective bargaining
or employment agreements or any agreements that contain severance, termination,
vacation or sick pay obligations with any of its officers or employees, other
than currently effective vacation and sick policies, copies of which have been
furnished to Purchaser. There are no pension, bonus, profit-sharing, stock
option, health insurance benefit, or other plans, agreements or arrangements
providing for officer or employee remuneration or benefits to which Seller is
bound, other than the Seller's currently effective health, disability and life
insurance plans and a 401(K) employee/employer contributed plan, copies of which
have been furnished to Purchaser. There is no pending or, to the knowledge of
Seller, threatened labor dispute, strike or work stoppage affecting Seller's
business.
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6.18 Liabilities; Other Contracts. Except as set forth in the Seller's
Financial Statements or described in Schedule 6.18 hereof, there are no debts,
liabilities or obligations, fixed or contingent, known or unknown, to which
Seller, its business or assets are subject, other than those incurred subsequent
to December 31, 1999 in the ordinary course of business consistent with past
practices. Seller is not a party to, nor are its assets bound by, any agreement
not entered into in the ordinary course of business consistent with past
practices, any indenture, mortgage, deed of trust, lease or any agreement that
is unusual in nature, duration or amount (including, without limitation, any
agreement requiring the performance by Seller of any obligation for a period of
time extending beyond one year from the Closing Date, calling for consideration
of more than $2,000, or requiring purchase at prices in excess of prevailing
market prices). Seller is not a party to, nor is Seller or any of its assets
bound by, any agreement that is materially adverse to the business, assets,
prospects or financial condition of Seller.
6.19 Compliance with Laws. To the best of Seller's knowledge and
belief, except as described in Schedule 6.19 hereof, the Seller has always
complied with, and is not in violation of, applicable federal, state or local
statutes, laws and regulations (including, without limitation, any applicable
environmental, building, zoning, or other law, ordinance or regulation)
affecting its properties or the operation of its business.
6.20 Compliance with Water Quality Regulations and Requirements. To the
best of Seller's knowledge and belief, except as described in Schedule 6.20
hereof, the water which Seller provides to its customers has always complied
with all applicable federal, state and local regulations and requirements and is
otherwise of good, potable quality.
6.21 Water Rights. Seller now has and as of Closing shall have good and
merchantable, fee simple title to the Water Rights. The Water Rights are free
and clear of all liens, security interests, mortgages, pledges, encumbrances,
taxes and assessments and charges or claims of whatever nature. The Water Rights
are in good standing with the Office of the New Mexico State Engineer and have
not been forfeited or abandoned and are not subject to judgment, suit, lien,
receivership or any other encumbrance whatsoever.
6.22 Licenses. Seller possesses and holds in its name all licenses,
permits, consents, franchises, approvals, authorization, qualifications, and
orders of all governments and governmental agencies (hereinafter collectively
referred to as "Licenses") required to enable Seller to conduct its business as
presently conducted and to own, lease and operate its assets as presently owned,
leased and operated. Schedule 6.22 hereof describes all Licenses that are held
by Seller. Except as described in Schedule 6.22, all of the Licenses held by
Seller are in full force and effect and there is no default of any provision
thereof which would affect the ability of Seller to engage in its business or
which would result in imposition of a criminal or monetary penalty in excess of
$250 in any single instance, or $1,000 in the aggregate. No action is pending
or, to Seller's knowledge, threatened, seeking the suspension, modification,
cancellation, revocation or limitation of any License and, to their knowledge,
there is no basis for such actions.
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6.23 Agreement Will Not Cause Breach or Violation. Neither the entry
into this Agreement nor the consummation of the transactions contemplated hereby
will result in or constitute any of the following: (i) a breach of any term or
provision of this Agreement, (ii) a default or any event that, with notice or
lapse of time, or both, would be a default, breach or violation of the Articles
of Incorporation or By-Laws of Seller or of any lease, franchise, License,
promissory note, conditional sales contract, commitment, indenture, mortgage,
deed of trust, or other agreement, instrument, or arrangement to which Seller or
is a party or by which the Seller or its assets are bound, (iii) an event that
would permit any party to terminate any agreement or policy of insurance or to
accelerate the maturity of any indebtedness or other obligation of Seller, (iv)
the creation of imposition of any lien, charge or encumbrance on any of the
assets of Seller, or (v) the violation of any permit, license, law, regulation,
ordinance, judgment, order or decree applicable to or affecting Seller or its
business, assets or financial condition.
6.24 Authority and Consents. No approvals or consents of any person
other than the NMPRC, NMED or EPA are necessary for or in connection with the
execution, delivery and performance of Seller's obligations hereunder.
6.25 Duration of Representation and Warranties. The representation and
warranties made hereinabove will be correct and accurate in all material
respects as of the Closing Date, and shall survive the Closing Date for the
limitation of actions period applicable to contracts in the State of New Mexico.
7. PURCHASER'S REPRESENTATIONS AND WARRANTIES
Purchaser hereby represents and warrants to Seller as follows:
7.1 Organization, Good Standing and Qualification. Purchaser is a
corporation duly organized, existing and in good standing under the laws of the
State of New Mexico, and has all necessary corporate powers to own and operate
its properties and to carry on its business as now owned and operated by it.
7.2 Authority and Consents. Purchaser has the right, power, legal
capacity and authority to enter into and perform its obligations under the
Agreement, and no approvals or consents of any persons, other than the NMPRC or
NMED, are necessary in connection therewith. The execution and delivery of this
Agreement and the consummation of the transactions hereunder by Purchaser have
been, or prior to the Closing will have been, duly authorized by all necessary
corporate action of Purchaser, approval by Board of Directors and no further
corporate authorization is or will be necessary on the part of Purchaser. This
Agreement constitutes a legal, valid and binding obligation of Purchaser
enforceable in accordance with its terms.
7.3 Books and Records. Purchaser reviewed the books and records prior
to executing this Agreement, and based upon their review, Purchaser satisfied
itself as to the financial condition of Seller's business
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7.4 Duration of Representation and Warranties. The representation and
warranties made hereinabove will be correct and accurate in all material
respects as of the Closing Date, and shall survive the Closing Date for a period
of six (6) years.
8. SELLER'S OBLIGATIONS BEFORE CLOSING.
Seller covenants that, except as otherwise agreed or waived in writing
by Purchaser, from the date of this Agreement until the Closing:
8.1 Access to Premises and Information. In addition to the right to
conduct investigations and inspections as provided in Article 4 hereof,
Purchaser and its counsel, accountants and other representatives shall have full
access during normal business hours to all Seller's properties, books, accounts,
records, contracts and documents of or relating to Seller and its assets,
properties and business. Seller shall furnish or cause to be furnished to
Purchaser and its representatives all data and information concerning the
business, finances and properties of Seller that Purchaser, in its sole
discretion, deems material to its decision to close.
8.2 Conduct of Business in Normal Course. Seller shall carry on its
business and activities diligently and in substantially the same manner as they
have been carried on through December 31, 1999, and shall not make or institute
any change in management, accounting or operations that will vary materially
from the methods used by the Seller as of that date.
8.3 Preservation of Business and Relationships. Seller shall use its
best efforts, without making any commitments or agreements on behalf of
Purchaser, to preserve its business organization intact, and to preserve its
present relationships with suppliers, customers and others having business
relationships with it. Seller shall, within (60) sixty days after the date
hereof, provide complete copies of all current supply and customer contracts and
other written documentation evidencing such relationships.
8.4 Maintain Insurance. Seller shall continue to carry its existing
insurance, subject to variations in amounts required by the ordinary operations
of its business. At the request of Purchaser and at Purchaser's sole expense,
Seller shall cause the amount of insurance, which at the date of this Agreement
Seller carries, to be increased by such amount or amounts as Purchaser shall
specify.
8.5 New Transactions. Seller shall not do, or agree to do, any of the
following acts without the prior written consent of Purchaser:
(a) Enter into any contract, commitment or transaction not in
the usual and ordinary course of its business, consistent with past practices;
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(b) Enter into any contract, commitment or transaction in the
usual and ordinary course of business involving an amount exceeding five
thousand dollars ($5,000) individually, except for items on Schedule 8.5(b)
hereof, or ten thousand dollars ($10,000) in the aggregate;
(c) Make any capital expenditures in excess of five thousand
dollars ($5,000), except for items on Schedule 8.5(c) hereof, for any single
item or in the aggregate, or enter into any leases of capital equipment or
property under which the annual lease charge is in excess of one thousand five
hundred dollars ($1,500); or
(d) Sell or dispose of any capital assets with a net book
value in excess of one thousand dollars ($1,000) individually or two thousand
dollars ($2,000) in the aggregate.
8.6 Payment of Liabilities and Waiver of Claims. Seller shall not do,
or agree to do, any of the following acts (i) pay any obligation or liability,
fixed or contingent, other than current liabilities, (ii) waive or compromise
any right or claim or (iii) cancel, without full payment, any note, loan or
other obligation owing to Seller.
8.7 Existing Agreements. Seller shall not modify, amend, cancel or
terminate any of its existing contracts or agreements, or agree to do any of
those acts.
8.8 Representations and Warranties True at Closing. Seller's
representations and warranties set forth in this Agreement or in any Exhibit,
Schedule, letter, certificate, memorandum and in any other written document
furnished by Seller or Controlling Party or on his, its or their behalf, in
connection with this Agreement shall be true and correct as of the Closing Date
as if made on that date and all conditions precedent to Closing shall have been
met at Closing.
8.9 NMPRC Filings. The Seller shall cooperate fully with Purchaser in
preparing and filing such applications to the NMPRC as Purchaser may deem
necessary or appropriate to obtain NMPRC approval of the transactions
contemplated by this Agreement.
8.10 Maintenance of Inventories. Seller shall maintain normal
quantities of materials and supplies determined in accordance with the practices
of Seller in existence on December 31, 1999.
8.11 Employees and Compensation. Seller shall not do, or agree to do,
any of the following: (i) grant any increase in salaries payable or to become
payable to any officer or employee, or (ii) increase benefits payable or to
become payable to any officer or employee, except for incentive compensation for
professional certification awards by a governmental agency or salary increases
in the ordinary course of business, consistent with past business practices and
approved by Purchaser who shall not unreasonably withhold such approval.
8.12 Transfer of Real Property Interest. Purchaser shall be satisfied
with respect to the Seller's ability to transfer merchantable title to Purchaser
for all real property and/or easements described in Schedule 8.12 herein.
Purchaser and Seller shall jointly prepare legal descriptions for
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all real property interest to be transferred from Seller to Purchaser ("Legal
Descriptions"). Prior to the Closing, Purchaser and Seller shall amend Schedule
1.2 (b) contained in this Agreement to include the Legal Descriptions.
8.13 Easement Claims. Purchaser shall be satisfied with respect to the
legal right of the easement claims contemplated herein. Purchaser and Seller
shall jointly prepare legal descriptions for the purpose of claiming an interest
("Legal Descriptions for Claims"), by prescription or otherwise, for all
easements described in Schedule 8.13. Prior to the Closing, Purchaser and Seller
shall amend Schedule 1.2 (b) contained in this Agreement to include the Legal
Descriptions for Claims.
8.14 Conveyance Documents. Seller shall convey the Assets to Purchaser
by a Xxxx of Sale in the Form as set forth by Schedule 8.14(a) attached hereto.
Seller shall convey the Operating Easements, to Purchaser by a Grant Deed in the
Form as set forth by Schedule 8.14(b) attached hereto. Seller shall convey the
Other Property to Purchaser by an Assignment of Property in the form of Schedule
8.14(c) attached hereto.
9. PURCHASER'S OBLIGATIONS BEFORE CLOSING
9.1 NMPRC Authorization. Purchaser will use its best efforts to secure
NMPRC authorization for the transactions contemplated under this Agreement. To
this end, Purchaser agrees to prepare at its own expense and file promptly with
the NMPRC an appropriate application for such authorization.
9.2 NMED Authorization. Purchaser will use its best efforts to secure
NMED authorization for the transactions contemplated under this Agreement. To
this end, Purchaser agrees to prepare at its own expense and file promptly with
the NMED, an appropriate application for such authorization. The Seller shall
cooperate fully with Purchaser in preparing and filing such applications to the
NMED.
9.3 EPA Approval. Purchaser will use its best efforts to secure EPA
approval for the transfer of Seller's National Pollution Discharge Elimination
System ("NPDES") permit(s) from Seller to Purchaser. To this end, Purchaser
agrees to prepare at its own expense and file promptly with the EPA an
appropriate application for such transfer. The Seller shall cooperate fully with
Purchaser in preparing and filing such applications to the EPA.
10. CONDITIONS PRECEDENT TO PURCHASER'S PERFORMANCE
The obligations of Purchaser under this Agreement are subject to the
satisfaction, at or before the Closing, of all the conditions set out below in
this Article 10. Purchaser may waive any or all of these conditions, other than
those set forth in Section 10.1 and 10.2 hereof, in accordance with Section 1.2
hereof; provided, however, that no such waiver of a condition shall constitute a
waiver by Purchaser of any of its other rights or remedies, at law or in equity,
if Seller or the Shareholders
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shall be in default of any of their representations, warranties, covenants or
agreements under this Agreement.
10.1 Authorization of NMPRC. NMPRC authorization for Purchaser to
acquire the Acquired Assets pursuant to the terms and conditions of this
Agreement shall be in full force and effect on the Closing Date.
10.2 Authorization of NMED. NMED authorization for Purchaser to operate
Seller's Utility Systems shall be in full force and effect on the Closing Date.
10.3 Authorization of EPA. EPA authorization for Purchaser to assume
Seller's NPDES permit(s) shall be in full force and effect on the Closing Date.
10.4 Approval by Purchaser's Board of Directors. Ratification and
approval of this Agreement and the transactions contemplated hereunder by
Purchaser's Board of Directors.
10.5 Accuracy of Seller's Representations and Warranties. The
representations and warranties of Seller in this Agreement and in any Exhibit,
Schedule, letter, certificate, memorandum and in any other written document
furnished by Seller, in connection with this Agreement shall be true on and as
of the Closing Date as though such representations and warranties were made on
and as of that date.
10.6 Absence of Liens; Title Insurance. At or prior to the Closing,
Purchaser shall have received a Uniform Commercial Code ("UCC") search report
dated as of a date not more than five (5) days before the Closing Date issued by
the New Mexico Secretary of State indicating that there are no filings under the
UCC on file with such Secretary of State which name Seller as debtor or
otherwise indicating any lien on the Acquired Assets. At the Closing, Purchaser
shall receive a policy of title insurance insuring fee simple title to the Real
Property, free of any lien or exception to title, other than exceptions
acceptable to Purchaser.
10.7 Seller's Corporate Approval. Seller shall have received corporate
authorization and approval for the execution and delivery of this Agreement and
shall have taken all corporate action necessary or proper to fulfill its
obligations to be performed under this Agreement on or before the Closing Date.
10.8 Seller's Performance. Seller shall have performed, satisfied and
complied with all covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with on or before the Closing
Date.
10.9 Certification by Seller. Seller shall have furnished Purchaser
with a certificate, dated the Closing Date, signed by Seller certifying, in such
detail as Purchaser and its counsel may reasonably request, that the conditions
specified in Sections 10.5 and 10.6 hereof have been fulfilled. Certification is
set forth in Schedule 10.9 attached hereto.
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10.10 Absence of Litigation. No action, suit or proceeding before any
court or any governmental body or authority (other than the NMPRC authorization
specified in Section 9.1, NMED authorization specified in Section 9.2 and EPA
authorization specified in Section 9.3) pertaining to the transactions
contemplated by this Agreement or to their consummation shall have been
instituted or threatened on or before the Closing Date.
10.11 Consents. All necessary agreements, consents and approvals of any
persons to the consummation of the transactions contemplated by this Agreement,
or otherwise pertaining to the matters covered by it, shall have been obtained
by Seller and delivered to Purchaser.
10.12 Approval of Documentation. The form and substance of all
certificates, instruments, opinions and other documents delivered to Purchaser
under this Agreement shall be satisfactory in all reasonable respects to
Purchaser and its counsel.
10.13 Purchaser's Satisfaction with Inspections, Title, Survey, Water
Quality. Purchaser shall be satisfied with all inspections and investigations
concerning title to and surveys of the Real Property, Water Rights and other
Acquired Assets, as provided in Article 4 hereof.
10.14 No Material Adverse Change. Prior to the Closing, there shall
have been no material adverse change in the Acquired Assets or liabilities, the
business or condition, financial or otherwise, the results of operations, or
prospects of Seller as described in the Annual Report of Seller as of December
31, 1999 filed with the NMPRC, whether (without limitation) as a result of any
legislative or regulatory change, revocation of any franchise or license, fire,
accident, storm or other casualty or labor or civil disturbance or act of God.
11. CONDITIONS PRECEDENT TO SELLER'S PERFORMANCE
The obligations of Seller under this Agreement are subject to the
satisfaction, at or before the Closing, of all the conditions set out below in
this Article 11. Seller may waive any or all of these conditions in accordance
with Section 1.2 hereof; provided, however, that no such waiver of a condition
shall constitute a waiver by it of any of its other rights or remedies, at law
or in equity, if Purchaser shall be in default of any of its representations,
warranties, covenants or agreements under this Agreement.
11.1 Accuracy of Purchaser's Representations and Warranties. The
representations and warranties by Purchaser contained in this Agreement and in
any Exhibit, Schedule, letter, certificate, memorandum and in any other written
document furnished by Purchaser, or on its behalf, in connection with this
Agreement shall be true on and as of the Closing Date as though such
representations and warranties were made on and as of that date.
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11.2 Purchaser's Performance. Purchaser shall have performed, satisfied
and complied with all covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by Purchaser on or before
the Closing Date.
11.3 Purchaser's Corporate Approval. Purchaser shall have received
corporate authorization and approval for the execution and delivery of this
Agreement and shall have taken all corporate action necessary or proper to
fulfill its obligations to be performed under this Agreement on or before the
Closing Date.
11.4 Certification by Purchaser. Purchaser shall have furnished Seller
with a certificate, dated the Closing Date, signed by an officer of Purchaser,
certifying, in such detail as they and their counsel may reasonably request,
that the conditions specified in Sections 11.1, 11.2 and 11.3 hereof have been
fulfilled. Certification by Purchaser is set forth in Schedule 11.4 attached
hereto.
12. SELLER'S OBLIGATIONS AFTER THE CLOSING
12.1 Indemnification. Seller agrees to indemnify, defend and hold
harmless Purchaser against any and all losses, claims, liabilities, damages,
actions, costs or expenses, including attorney's fees and costs (the
"Indemnified Losses") arising from, in connection with, or with respect to the
following items:
(a) Any breach of any representation, warranty, covenant or
agreement of Seller contained in this Agreement, or any agreement, certificate
or document executed and delivered by them, or their affiliates pursuant hereto
or in connection with any of the transactions contemplated in this agreement;
(b) Any failure by Seller to satisfy, perform or pay any
liabilities relating to Seller, except those specifically assumed by Purchaser
and identified in Schedule 2.1 contained in this Agreement.
(c) Any and all actions, suits, proceedings, claims or demands
by third parties ("Third Party Claims") and losses, liabilities, expenses or
judgments relating thereto, directly resulting from or arising from matters (i)
relating to Seller, its business or the Acquired Assets which occurred or are
alleged to have occurred prior to the Closing or (ii) matters relating to
Seller, or liabilities of Seller other than those specifically assumed by
Purchaser and identified in Schedule 2.1 contained in this Agreement.
Third Party Claims shall include, without limitation, any and all actions,
suits, proceedings, claims or demands by governmental agencies or third parties
made in connection with any Environmental Condition (as defined in this
Subsection 12.1(d)) that (i) exists or is alleged to have existed on the Real
Property on or prior to the Closing Date or (ii) that exists or is alleged to
exist on
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other land due to activities on the Real Property as of or prior to the Closing
Date. "Environmental Condition" means the presence of any "hazardous substance"
as that term is defined in any federal, state, county or municipal statute,
ordinance, regulation, rule, order, judgment or decree, including, without
limitation, (i) the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended; the Resource Conservation and Recovery Act of
1976, as amended; the Clean Air Act; the Water Pollution Control Act (the Clean
Water Act); the Toxic Substances Control Act; the Safe Drinking Water Act; and
the Insecticide, Fungicide and Rodenticide Control Act, as amended; and any
state counterpart of those laws; and (ii) any material or substance which is now
listed in the United States Department of Transportation Hazardous Materials
Table (49 CFR ss.172.101); and any contaminant, oil, petroleum product or
by-product, radioactive material or by-product, any mining waste, toxic
substance, hazardous waste or other material, the removal of which is required
or the existence or management of which is prohibited, penalized or regulated by
any federal, state or local government agency, authority or unit.
(d) If a Third Party Claim is made against Purchaser,
Purchaser shall notify in writing, and in reasonable detail, of the Third Party
Claim within 30 business days after it receives written notice thereof;
provided, however, that failure to give such notice shall not affect the
indemnification obligation provided hereunder except to the extent Seller shall
have been actually prejudiced as a result of such failure. Thereafter, Purchaser
shall deliver to Seller, within five business days after Purchaser's receipt
thereof, copies of all notices and documents (including court papers) received
by Purchaser relating to Third Party Claim. Purchaser shall have the right to
assume the defense of any Third Party Claim with counsel selected by it. Seller
shall have the right to participate in the defense and to employ a counsel, at
their expense, separate from the counsel employed by Purchaser. Counsel for
Purchaser shall cooperate and share information with counsel for Seller if they
participate in the defense of the Third Party Claim, but Purchaser shall control
such defense at all times. Seller shall be liable to Purchaser for the
reasonable fees and expenses of the counsel it employs to defend the Third Party
Claim.
If Purchaser does not elect to assume the defense of a Third Party
Claim, Seller shall be obligated to assume the defense thereof at their own
expense. Purchaser shall be entitled to participate in the defense thereof with
separate counsel employed at its own expense.
12.2 Duration of Indemnification; Statutory Limitation. Except as
described in Schedule 12.2 hereof, the obligations agreed to by Seller in
Sections 12.1 (a) through (d) shall survive the Closing Date for a period of
four (4) years. If a court of competent jurisdiction determines that the
provisions of Section 56-7-1, XXXX 0000, as amended, are applicable to this
Agreement or any claim arising under this Agreement, then any agreement to
indemnify contained in this Agreement shall not extend to liability, claims,
damages, losses or expenses, including attorney fees, arising out of:
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(a) The preparation or approval of maps, drawings, opinions,
reports, surveys, change orders, designs or specifications by the indemnitee, or
the agents or employees of the indemnitee; or
(b) The giving of or the failure to give directions or
instructions by the indemnitee, or the agents or employees of the indemnitee,
where such giving or failure to give directions or instructions is the primary
cause of bodily injury to persons or damages.
12.3 Access to Records. From and after the Closing, Seller shall allow
Purchaser and its counsel, accountants, and other representatives such access to
records which after the Closing are in the custody or control of Seller as
Purchaser reasonably requests.
13. PURCHASER'S OBLIGATIONS AFTER THE CLOSING
13.1 Indemnification. Purchaser agrees to indemnify, defend and hold
harmless Seller against any and all losses, claims, liabilities, damages,
actions, costs or expenses, including attorney's fees and costs (the
"Indemnified Losses") arising from, in connection with, or with respect to the
following items:
(a) Any breach of any representation, warranty, covenant or
agreement of Purchaser contained in this Agreement, or any agreement,
certificate or document executed and delivered by them, or their affiliates
pursuant hereto or in connection with any of the transactions contemplated in
this agreement;
(b) Any and all actions, suits, proceedings, claims or demands
by third parties, or assessments or judgments in their favor, directly resulting
from or arising from matters relating to (i) the Acquired Assets which occurred
or are alleged to have occurred after the Closing or (ii) liabilities assumed by
Purchaser and identified in Schedule 2.1 contained in this Agreement.
13.2 Duration of Indemnification; Statutory Limitation. The obligations
agreed to by Purchaser in Section 13.1 (a) and (b) shall survive the Closing
Date for a period of six (6) years. If a court of competent jurisdiction
determines that the provisions of Section 56-7-1, XXXX 0000, as amended, are
applicable to this Agreement or any claim arising under this Agreement, then any
agreement to indemnify contained in this Agreement shall not extend to
liability, claims, damages, losses or expenses, including attorney fees, arising
out of:
(a) The preparation or approval of maps, drawings, opinions,
reports, surveys, change orders, designs or specifications by the indemnitee, or
the agents or employees of the indemnitee; or
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(b) The giving of or the failure to give directions or
instructions by the indemnitee, or the agents or employees of the indemnitee,
where such giving or failure to give directions or instructions is the primary
cause of bodily injury to persons or damages.
13.3 Seller's Facility Master Plan. Purchaser acknowledges Seller's
facilities master plan and intends to integrate its goals and objectives into
Purchaser's facility master plan, where such goals and objectives are applicable
and compatible with Purchaser's own facilities master plan. The parties further
understand that Purchaser must comply with NMPRC policies on system expansion,
and Purchaser cannot invest in facilities that are not in the best interest of
its customers and in compliance with NMPRC policy.
14. COSTS
14.1 Finder's or Broker's Fees. Except for the obligation to Xxxxx
Xxxxx as set forth in Xxxxx' agreement with Purchaser, each of the parties
represents and warrants that it has not dealt with any broker or finder in
connection with any of the transactions contemplated by this Agreement, and,
insofar as it knows, no broker or other person is entitled to any commission or
finder's fee in connection with any of these transactions
14.2 Escrow and Title Expenses. Purchaser shall pay for all costs, fees
and expenses incurred or to be incurred by it relating to title insurance.
Seller shall pay the transfer tax associated with the transfer of all real
property and easements by it to Purchaser.
14.3 Survey and Related Expenses. Seller shall pay for all costs, fees
and expenses incurred or to be incurred by it relating to perfecting the
transfer of certain real property interests to Purchaser described in Schedule
8.12.
14.4 All Other Expenses. Except for those expenses described in
Sections 14.2 and 14.3, each of the parties shall pay all costs and expenses
incurred or to be incurred by it in negotiating and preparing this Agreement and
in closing and carrying out the transactions contemplated by this Agreement.
15. FORM OF AGREEMENT
15.1 Headings. The subject headings of the Articles and Sections of
this Agreement are included for purposes of convenience only, and shall not
affect the construction or interpretation of any of its provisions.
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15.2 Entire Agreement; Modification; Waiver. This Agreement constitutes
the entire agreement between the parties pertaining to the subject matter
contained herein and supersedes all prior and contemporaneous agreements,
representations and understandings of the parties. No supplement, modification
or amendment of this Agreement shall be binding unless executed in writing by
all the parties. No waiver of any of the provisions of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall be
binding unless executed in writing by the party making the waiver.
15.3 Counterparts. This Agreement may be executed simultaneously in one
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
16. PARTIES
16.1 Parties in Interest. Nothing in this Agreement, whether express or
implied, is intended to confer any rights or remedies under or by reason of this
Agreement on any persons other than the parties to it and their respective
successors and permitted assigns, nor is anything in this Agreement intended to
relieve or discharge the obligation or liability of any third persons to any
party to this Agreement, nor shall any provisions give any third persons any
right of subrogation or action over against any party to this Agreement.
16.2 No Assignment. This Agreement may not be transferred, assigned,
pledged or hypothecated by any party hereto, except by Purchaser to an
affiliated company which is controlled by, controls, or under common control
with it; provided, further, that Purchaser may assign (whether or not as
collateral) Purchaser's rights to payments hereunder. This Agreement shall be
binding on and shall inure to the benefit of the parties to it and their
respective heirs, legal representatives, successors and permitted assigns.
17. REMEDIES
17.1 Recovery of Litigation Costs. If any legal action or other
proceeding is brought by either Seller or Purchaser for the enforcement of this
Agreement, or because of an alleged dispute, breach, default or
misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing party or parties shall be entitled to recover
reasonable attorney's fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be entitled.
17.2 Non-Exclusivity of Remedies. The remedies provided for in this
Section 17 are not intended, and shall not be deemed, to be exclusive or
restrictive of any other rights to which the parties are entitled by law or
equity with respect to any breach or default of any representations, warranties,
covenants or agreements under this Agreement.
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18. NOTICES
All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given on the
date of service if served personally on the party to whom notice is to be given,
or on the third day after mailing if mailed to the party to whom notice is to be
given, by first class mail registered or certified, postage prepaid, and
properly addressed as follows:
To Seller at: Rio Grande Utility Corporation
X.X. Xxx 0000
Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
To Purchaser at: NEW MEXICO WATER SERVICE COMPANY
0000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Any party may change its address for purposes of this Section 17 by
giving the other party written notice of the new address in the manner set forth
above.
19. GOVERNING LAW
This agreement shall be construed in accordance with, and governed by,
the laws of the State of New Mexico, without regard to, any contrary conflict of
laws provision or rule.
20. MISCELLANEOUS
20.1 Announcements. Seller will not make any announcements to the
public or to agents of Seller concerning this Agreement or the transactions
contemplated hereby without the prior approval of Purchaser, which will not be
unreasonably withheld.
20.2 Knowledge. Where any representation or warranty contained in this
Agreement is expressly qualified by reference to the knowledge of any party,
such party confirms that it has made due and diligent inquiry as to the matters
that are the subject of such representations and warranties.
20.3 Severability. If any provision in this Agreement shall be held
invalid, illegal or unenforceable, the validity, legality or enforceability of
the remaining provisions hereof will not in any way be affected or impaired
thereby.
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20.4 References. Unless otherwise specified, references to Sections or
Articles are to Sections or Articles in this Agreement. All references to this
"Agreement" shall include its Exhibits and Schedules.
IN WITNESS WHEREOF, the parties to this Agreement have duly executed it as of
the day and year first above written.
PURCHASER: NEW MEXICO WATER SERVICE COMPANY, a New Mexico
corporation
By: /s/ Xxxxx X. Xxxxxx
XXXXX X. XXXXXX
Chief Executive Officer
SELLER: RIO GRANDE UTILITY CORPORATION, a New Mexico
corporation
By: /s/ Xxxx Xxxxxx
XXXX XXXXXX
President
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SCHEDULE 2.4
ASSUMPTION AGREEMENT
FOR VALUABLE CONSIDERATION, New Mexico Water Service Company, a New
Mexico corporation ("Purchaser"), hereby assumes those obligations and
liabilities of Rio Grande Utility Corporation, a New Mexico corporation
("Seller") described in Schedule 2.1 of the Asset And Real Property Purchase And
Sale Agreement ("Agreement"), dated November 6, 2000, among Purchaser and
Seller.
Pursuant to Section 2.1 of the Agreement, Purchaser is not assuming and
will not assume or be obligated to satisfy or perform any liabilities,
obligations or commitments of Seller, other than those described in Schedule 2.1
to the Agreement, whether fixed or contingent, or known or unknown.
IN WITNESS WHEREOF, Purchaser has caused this Assumption Agreement to
be executed as of this 6th day of November 2000.
NEW MEXICO WATER SERVICE COMPANY
A New Mexico Corporation
By /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Chief Executive Officer
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SCHEDULE 8.14(a)
XXXX OF SALE
FOR GOOD AND VALUABLE CONSIDERATION, receipt of which is hereby
acknowledged, Rio Grande Utility Corporation, a New Mexico corporation
("Seller"), hereby sells, grants, conveys, assigns, transfers and sets over to
NEW MEXICO WATER SERVICE COMPANY, a New Mexico public utility water corporation
("Purchaser"), all improvements and personal property comprising the water
production, storage and distribution facilities and all water rights, and assets
of every kind comprising the Utility Systems owned and operated by Seller, in
the area of Belen, Valencia County, New Mexico, including, without limiting the
generality of the foregoing, the following:
1. All of the Improvements described in Schedule 1.2(a) attached
hereto.
2. To the extent not described in Schedule 1.2(a) hereto, all xxxxx,
pumps, pumping plants and pumping equipment, tanks, mains, pipes, pipelines,
hydrants, valves, connections, services, meters, meter boxes and associated
facilities, buildings, structures, improvements and appurtenances thereto, and
all property and assets of every kind comprising a part of or used in connection
with the operation of Seller's potable Utility Systems.
3. All rights of any kind now held by Seller in and to any and all
water, water rights and rights to receive distribution of water.
4. Seller warrants to Purchaser that Seller owns and has the right to
convey all property conveyed by this Xxxx of Sale and that all property conveyed
hereby is conveyed free and clear of all liens, encumbrances, claims and
liabilities.
Executed on the 6th day of November, 2000.
RIO GRANDE UTILITY CORPORATION
a New Mexico Corporation
By: /s/ Xxxx Xxxxxx
Xxxx Xxxxxx
President
By: /s/ Xxxxxxx Xxxxx
Xxxxxxx Xxxxx
Controller
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