EXHIBIT 10.1
June 16, 2003
LETTER OF INTENT FOR THE PURCHASE OF BUSINESS ASSETS
Xxxxx Xxxxx
Broadway Smog Check
0000 Xxxxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Dear Xx. Xxxxx Xxxxx:
The following will summarize the principal terms of an asset purchase
agreement ("Asset Purchase Agreement") to be entered into between Smog Centers
of California LLC, or its designee or assignee, ("Buyer"), and you ("Seller"),
as follows:
1. Buyer will purchase from Seller certain assets, including among
other things, current assets, fixed assets, trademarks, tradenames, and all
intangible assets, including goodwill, (collectively, "Purchased Assets") used
by Seller in connection with the ownership and operation of smog testing
facility located at 0000 Xxxxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000 ("Business").
Buyer will not assume any liability incurred by Seller on or prior to the
Closing Date, as defined in this Letter of Intent, other than the liabilities
set forth in the Asset Purchase Agreement to be specifically assumed by Buyer.
2. The purchase price shall be $60,00, payable as follows:
(a) $5,000 due upon the signing of this Letter of Intent;
(b) $55,000 payable within thirty (30) days from the date of
this Letter of Intent.
3. The closing of the Asset Purchase Agreement ("Closing") will be a
date not later than -0- days after the Asset Purchase Agreement is signed, which
will be the Closing Date.
4. The terms of the proposed purchase will be further negotiated and
memorialized in the definitive Asset Purchase Agreement, which will contain the
usual and customary Seller's representations and warranties, specific
obligations of the parties pending the Closing and conditions precedent to
Closing.
5. Xxxxx's representatives are to be permitted to make a full and
complete investigation of the business, properties, customers, financial
statements and books and records of Seller for a period of thirty (30) days from
the signing of this Letter of Intent ("Due Diligence Period").
6. During the period prior to Closing, Seller will operate the Business
in the ordinary course and Seller will use its best efforts to preserve the
Business.
7. Seller agrees to grant to Buyer an exclusive right to acquire the
Purchased Assets for a period of thirty (30) days from the date of this Letter
of Intent and will not offer, solicit bids for or negotiate the purchase of, the
Purchased Assets with any other potential buyer.
8. Seller and Buyer each agree to bear its own expenses incurred in
connection with the proposed purchase of assets, including fees of their
respective attorneys, accountants and other advisors.
This Letter of Intent is accepted by the parties as a statement of
mutual intention at this time to conduct further negotiations along the lines
indicated above, and it is understood that the proposed purchase of assets is
subject to the negotiation of the Asset Purchase Agreement, and review and
approval thereof by the respective legal counsel of the parties. It is
understood that except for the provisions of paragraphs 7 and 8 (which are
binding on Seller), neither Seller or Buyer will be bound to the other by this
Letter of Intent for damages, expenses, failure to finally agree upon a formal
and final Purchase Agreement, or in any other way.
If the foregoing correctly sets forth our general understanding, kindly
so indicate by signing and returning the enclosed copy of this Letter of Intent.
Very truly yours,
AGREED AND ACCEPTED AS OF THE DATE OF THIS LETTER:
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