Exhibit 10 (v)
ASSET PURCHASE AGREEMENT
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AGREEMENT dated October 14, 1999 among BERKSHIRE SERVICE SOLUTIONS,
INC., a Massachusetts corporation with a principal place of business in
Pittsfield, Massachusetts ("BSS"), XXXXX, INC., a Massachusetts corporation
with a principal place of business in Pittsfield, Massachusetts ("Xxxxx"),
XXXXXXX XXXXX of Xxxxxxxxxxx, Massachusetts ("Xxxxxxx"), and XXXXXX X. XXXX
of Xxxxxx, Massachusetts ("Xxxxxx"; Xxxxxxx and Xxxxxx are collectively
referred to herein as the "Stockholders").
PRELIMINARY STATEMENT
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BSS is a wholly-owned subsidiary of Berkshire Energy Resources, a
Massachusetts business trust with a principal place of business in
Pittsfield, Massachusetts ("BER"). BSS was organized by BER to: (a) engage
in the business of mechanical contracting, including the design,
installation and servicing of plumbing, heating, ventilating and air
conditioning systems and equipment (including sheet metal fabrication) and
the sale and servicing of related products (the "MC Business"), (b) acquire,
pursuant to this Agreement, all of the MC Business assets of Xxxxx, and (c)
acquire the business assets of other entities engaged in the MC Business.
Xxxxx is engaged in the MC Business in Berkshire County, Massachusetts
with places of business at 724 and 000 Xxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx and at 000 Xxxx Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx (the
"Xxxxx Business").
Xxxxx desires to sell to BSS, and BSS desires to purchase from Xxxxx,
substantially all of the assets of the Xxxxx Business, on the terms and
subject to the conditions set forth herein.
AGREEMENT
IT IS THEREFORE AGREED AS FOLLOWS:
1. SALE OF ASSETS. At the Closing (as defined in Section 6), Xxxxx
shall sell to BSS, and BSS shall purchase from Xxxxx, for the Purchase Price
(defined in Section 4) the following assets of Xxxxx (the "Purchased
Assets"):
(a) all furniture and fixtures including leasehold improvements by
Xxxxx at its 724 and 000 Xxxxx Xxxxxx, Xxxxxxxxxx and 000 Xxxx
Xxxxxxxxxx Xxxxxx, Xxxxxx, locations, machinery, vehicles and
equipment (collectively, "FF&E"), including, without
limitation, the FF&E listed on Schedule 1 (a) attached hereto;
(b) all accounts receivable ("Accounts Receivable") listed on
Schedule 1 (b) attached hereto;
(c) all inventory ("Inventory") listed on Schedule 1 (c) attached
hereto;
(d) all customer lists of any type or description;
(e) all rights to the telephone numbers assigned to Xxxxx;
(f) the business names "Xxxxx" and "Xxxxxx Sheet Metal" for use in
connection with the MC Business and related goodwill;
(g) all of Xxxxx'x contract rights under all contracts entered into
in connection with the Xxxxx Business (the "Xxxxx Contracts"),
including the Re-Bath Agreement (defined in Section 18), to the
extent such rights are transferable;
(h) all customer work-in-process ("Work-in-Process") listed on
Schedule 1 (h) attached hereto; and
(i) all other assets utilized in the operation of the Xxxxx
Business,
excluding the Excluded Assets (defined in Section 2).
2. EXCLUDED ASSETS. The Purchased Assets shall not include (a)
cash and cash equivalents such as prepaid insurance and (b) those assets
listed on Schedule 2 attached hereto (the "Excluded Assets").
3. ASSUMPTION OF LIABILITIES; ASSIGNMENT OF XXXXX CONTRACTS. BSS
shall not assume, and shall have no obligation to pay, any liabilities or
obligations of Xxxxx or the Stockholders except for liabilities and
obligations set forth on Schedule 3 attached hereto (the "Assumed
Liabilities"). At the Closing, Xxxxx and BSS shall enter into an assignment
and assumption agreement with respect to the Assumed Liabilities and the
Xxxxx Contracts in the form attached hereto as Exhibit 3 (the "Assignment
and Assumption Agreement").
4. PURCHASE PRICE; ALLOCATION OF PURCHASE PRICE.
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4.1 Purchase Price. The purchase price (the "Purchase Price")
for the Purchased Assets, which shall be subject to adjustment as set
forth in Section 4.4, shall be the sum of $1,136,462, which includes
$278,000 designated to be used by Xxxxx to satisfy third-party trade
creditor obligations as of the Closing.
4.2 Payment of the Purchase Price; Escrow. Except for that
portion of the Purchase Price that shall be held in escrow as set
forth in Section 4.2.2, the Purchase Price shall be paid at the
Closing by wire transfer to Xxxxx of immediately available funds to
accounts designated by Xxxxx.
4.3 Escrow. Simultaneously with the receipt of the Purchase
Price, Xxxxx shall remit to Cain, Hibbard, Xxxxx & Xxxx, P.C. (the
"Escrow Agents") $150,000 of the Purchase Price to be held in escrow
pursuant to the terms and conditions of an Escrow Agreement among BSS,
Xxxxx and the Escrow Agents in the form of Exhibit 4.3.2 attached
hereto (the "Escrow Agreement").
4.4 Purchase Price Allocation. The allocation of the Purchase
Price (the "Purchase Price Allocation") shall be as follows, subject
to adjustment as set forth in Section 4.5:
FF&E $212,636
Accounts Receivable $445,754
Inventory $176,500
Goodwill $301,572
To the extent permitted by law, the parties shall not take any position on
any income tax returns or before any governmental agency charged with the
collection of any tax, or in any judicial proceeding relating thereto, that
shall be inconsistent with the allocation of the Purchase Price set forth in
this Section 4.4.
4.5 Adjustment of the Purchase Price and Purchase Price
Allocation as at the Closing.
4.5.1 The Purchase Price is predicated in part on the
value of Accounts Receivable, and Work-in-Process, and the
Purchase Price shall be appropriately increased or reduced, as
confirmed by an Addendum to this Agreement (the "Purchase Price
Adjustments"), by the amount by which the value of Accounts
Receivable and Work-in-Process, as of the end of the business
day immediately preceding the Closing, shall be above or below
the following amounts:
Closing A/R $445,754
Work-in-Process $ 42,380
As used herein, "Closing A/R" shall mean the total Accounts Receivable shown
on the books of Xxxxx.
4.5.2 The Purchase Price and Purchase Price Allocation
shall be adjusted to reflect the Purchase Price Adjustments.
4.6 Adjustment of Purchase Price After the Closing. After
the Closing, the Purchase Price shall be adjusted to reflect the
actual amount of Closing A/R collected by BSS during the six-month
period following the Closing, with the amount of any deficit disbursed
to BSS as provided in the Escrow Agreement.
5. LOAN BY BSS TO THE STOCKHOLDERS. At the Closing, BSS shall loan
(a) Xxxxxxx the sum of $210,000 and (b) Xxxxxx the sum of $90,000 on the
terms set forth in the promissory notes attached hereto as Exhibit 5 (the
"Notes"). Xxxxxxx and Xxxxxx acknowledge that during the term of the Notes,
each shall receive notification from BSS on an annual basis, pursuant to
Internal Revenue Code Section 7872, of the amount of foregone interest
deemed to have been paid as additional compensation.
6. CLOSING. The closing (the "Closing") of BSS's purchase of the
Purchased Assets shall take place on October 14, 1999 (the "Closing Date"),
at 10:00 a.m. at the offices of Cain, Hibbard, Xxxxx & Xxxx, P.C., 00 Xxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx, or at such other time and place as shall
be mutually agreed upon by the parties.
7. REPRESENTATIONS AND WARRANTIES BY XXXXX AND THE STOCKHOLDERS.
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Xxxxx and the Stockholders jointly and severally represent and warrant to
BSS as follows:
7.1 Organization. Xxxxx is a corporation duly organized,
validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and is qualified to conduct its business
as it is presently conducted. Xxxxx has the corporate power and is
duly authorized to carry on its business where and as now conducted
and to own, lease, use and operate its properties as it now does.
7.1.1 Xxxxx is the surviving corporation in a merger
between Xxxxx and Dalton Sheet Metal Co., Inc. pursuant to
Articles of Merger filed with the Massachusetts Secretary of
State on April 1, 1998. Since the effective date of the merger,
all business activities of the former Xxxxxx Sheet Metal Co.,
Inc. have been conducted through Xxxxx as the surviving
corporation. There are no affiliates or subsidiaries of Xxxxx.
7.1.2 The authorized capital stock of Xxxxx consists of
12,500 shares of common stock, no par value, of which 1,000
shares are issued and outstanding (the "Shares"). The
Stockholders are and will be on the Closing Date the record and
beneficial owners and holders of the Shares, free and clear of
all encumbrances. Xxxxxxx owns 700 of the Shares, and Xxxxxx
owns 300 of the Shares.
7.2 Capacity. Xxxxx and each of the Xxxxx Stockholders has
full authority and capacity to enter into and to perform this
Agreement in accordance with its terms, and is not bound by or subject
to any contractual or other obligation that would be violated by the
execution or performance of this Agreement, and this Agreement is
valid and binding upon Xxxxx and the Stockholders in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditor's rights in general.
7.3 Financial Statements. Xxxxx has delivered to BER financial
statements of Xxxxx for the fiscal years ended March 31, 1998 and
March 31, 1999, prepared on a "review" basis by Xxxxx'x independent
certified public accountants, including balance sheets of Xxxxx as at
such dates and statements of income, retained earnings and cash flows
for the periods then ended, together with related notes and schedules
and internally prepared financial statements for the five months ended
August 31, 1999, which include a balance sheet of Xxxxx at such date
and a statement of income for such period (collectively, the "Xxxxx
Financial Statements"). Except to the extent that certain 2000 year-
end adjustments may not be reflected on the financial statements for
the five months ended August 31, 1999, the Xxxxx Financial Statements
have been prepared in accordance with generally accepted accounting
principles applied on a basis consistent with prior periods and fairly
present the financial condition of Xxxxx as of the respective dates
thereof and the results of operations of Xxxxx for the periods then
ended.
7.4 Absence of Certain Changes. Except as noted on the Xxxxx
Financial Statements or as set forth on Schedule 7.4 attached hereto,
from the date of the Xxxxx Financial Statements through the date
hereof, the business of Xxxxx has been operated in the ordinary course
and there has not been:
7.4.1 Any change in the assets, liabilities, business,
prospects, or condition (financial or otherwise) of Xxxxx except
changes in the ordinary course of business, none of which shall
have been materially adverse.
7.4.2 Any damage, destruction or loss (whether covered by
insurance or not) materially or adversely affecting the business
or properties of Xxxxx.
7.4.3 Any general salary increase made for the benefit of
the employees of Xxxxx or any specific increase in the salary of
any employee of Xxxxx.
7.4.4 Any unusual commitment or liability incurred, or
any unusual acquisitions or purchases made, by Xxxxx.
7.4.5 Any significant event or condition of any character
materially or adversely affecting the business or prospects of
Xxxxx.
7.5 Taxes. Xxxxx has filed all federal, state and local
income, employment and other tax returns required to be filed by it on
or before the dates on which such returns were due to be filed or
extensions to file such returns have been timely filed or granted and
have not expired. Except as set forth on Schedule 7.5 attached
hereto, Xxxxx has paid all taxes of any nature for which Xxxxx is
responsible, except for taxes which are not yet due and payable as of
the date hereof. The amounts established as provisions for taxes on
the Xxxxx Financial Statements are sufficient for the payment of all
accrued and unpaid federal, state and local income, employment and
other taxes of Xxxxx for all periods ending prior to August 31, 1999.
Except as set forth on Schedule 7.5, (a) there are no claims pending
or threatened against Xxxxx for unpaid taxes, (b) there are no
outstanding waivers or agreements by Xxxxx for the extension of the
time for the assessment of any tax, (c) neither the Internal Revenue
Service nor any state agency has conducted a tax audit or examination
of Xxxxx for the past three years, and (d) no deficiencies in taxes or
any other governmental charges have been claimed, proposed or assessed
against Xxxxx, and no facts exist or have existed which would
constitute a basis for assessment of liability for any tax or other
governmental charge which is not reflected on the Xxxxx Financial
Statements.
7.6 Title. Except as set forth on Schedule 7.6 attached
hereto, Xxxxx has, and as of the Closing shall be conveying to BSS,
good and marketable title to the Purchased Assets, free and clear of
all claims, liens or other encumbrances.
7.7 Personnel. Attached hereto as Schedule 7.7 is a true and
complete (a) list of all employees of Xxxxx which sets forth (i) the
full name, address and social security number of each employee, (ii)
each employee's date of hire, (iii) the method of payment (i.e. hourly
or salaried) and current rate of earnings for each employee and (iv)
any written agreement relating to such employee's employment and (b)
description of all employee benefit plans, programs or arrangements,
written or unwritten, to which Xxxxx is a party, including, without
limitation, any pension, profit sharing or other retirement plans, any
health and welfare benefit plans, and plans, programs or arrangements
for bonuses, vacation and other leaves, severance and deferred
compensation. Xxxxx has no collective bargaining agreement with any
of its employees. The term of the employment agreement for Xxxx
Xxxxxx, a copy of which is attached to Schedule 7.7, has expired and
has not been extended or renewed.
7.8 Litigation; Etc. Except as set forth on Schedule 7.8
attached hereto, (a) there is no litigation, proceeding or
governmental investigation pending or, to the knowledge of Xxxxx or
the Stockholders, threatened, and there is no order, injunction or
decree outstanding against or relating to Xxxxx or any Stockholder,
the property, assets or business of Xxxxx or any Stockholder. Neither
Xxxxx nor any of the Stockholders is in violation of any applicable
law, regulation, ordinance, order, injunction or decree, or any other
requirement of any governmental body or court, relating to the
property or business of Xxxxx.
7.9 Leases, Contracts, Etc. Attached hereto as Schedule 7.9
are complete and accurate lists, descriptions and/or schedules of the
following:
7.9.1 With respect to the real property or personal
property leased by Xxxxx:
7.9.1.1 The location of such property;
7.9.1.2 The name of the landlord or lessor of each
such property which is leased, together with (a) the name
of the tenant or lessee, (b) the rental payable, (c) the
expiration date of existing leases and a specification of
all rights of renewal or purchase or other rights existent
upon expiration, and (d) a copy of each existing lease.
7.9.2 All mortgages, pledges, deeds of trust, loan and
credit instruments, and agreements and similar instruments to
which Xxxxx is a party.
7.9.3 To the extent not included in the foregoing, all
leases, purchase and sales orders, licenses, contracts,
agreements, commitments and understandings of any nature,
written or oral to which Xxxxx is a party in any capacity or by
which it is bound, and which cannot be terminated by Xxxxx on
less than 30 days' notice without liability or which involve
expenditure by Xxxxx of more than $10,000 (a "Contract").
Except as set forth on Schedule 7.8 and 7.9, with respect to
each Contract:
7.9.3.1 Xxxxx is, and at all times since the first
day of the last completed fiscal year has been, in
compliance with all applicable material terms and
requirements of each Contract under which Xxxxx has or had
any obligation or liability or by which Xxxxx, or any of
the assets owned or used by Xxxxx, is or was bound.
7.9.3.2 No event has occurred or circumstances
exist that (with or without notice or lapse of time) may
contravene, conflict with, or result in a violation or
breach of, or give Xxxxx the right to declare a default or
exercise any remedy under, or to accelerate the maturity
or performance of, or to cancel, terminate or modify, any
Contract.
7.9.3.3 Xxxxx has not given to or received from any
other party, at any time since the first day of the last
completed fiscal year of Xxxxx, any notice or other
communication (whether oral or written) regarding any
actual, alleged, possible or potential violation or breach
of, or default under, any Contract.
7.10 Accuracy of Representations. All statements contained in
any exhibit, certificate or other document delivered by or on behalf
of Xxxxx or the Stockholders pursuant to this Agreement or in
connection with the transactions contemplated hereby shall be deemed
representations and warranties hereunder by Xxxxx and the
Stockholders. No representation or warranty by Xxxxx or any
Stockholder in this Agreement or in any exhibit, certificate or other
document delivered or to be delivered by Xxxxx or the Stockholders
pursuant to this Agreement or in connection with the transactions
contemplated hereby contains or will contain any untrue statement of a
material fact, or omits or will omit to state a material fact
necessary to make the statements contained therein not misleading.
7.11 Condition and Sufficiency of Assets. The FF&E listed on
Schedule 1 (a) is in good operating condition and repair and is
adequate for the uses to which they are being put, and none of such
FF&E is in need of maintenance or repairs except for (a) ordinary,
routine maintenance and repairs and (b) other repair in an amount not
to exceed $5,000. The FF&E of Xxxxx is sufficient for the continued
conduct of the Xxxxx Business after the Closing in substantially the
same manner as conducted prior to the Closing.
7.12 Accounts Receivable. All accounts receivable of Xxxxx
listed on Schedule 1 (b) and all unbilled Work-in-Process listed on
Schedule 1 (h) (each an "Account" and collectively, the "Accounts") as
of the Closing Date represent or will represent valid obligations
arising from services actually performed in the ordinary course of
business. Unless paid prior to the Closing Date, the Accounts are or
will be as of the Closing Date current and collectible. Except as set
forth on Schedule 7.8, there is no contest, claim or right of set-off,
other than returns in the ordinary course of business, under any
contract with any obligor of an Account relating to the amount or
validity of such Account.
7.13 Inventory. The Inventory of Xxxxx listed on Schedule 1
(c) consists of a quality and quantity usable and salable in the
ordinary course of business, except for obsolete items and items of
below-standard quality, all of which have been written off or written
down to the net realizable value and have been valued as such as of
the Closing Date. The quantities of each item of inventory (whether
raw materials, work-in-process or finished goods) are not excessive,
but are reasonable in the present circumstances of Xxxxx.
8. REPRESENTATIONS AND WARRANTIES BY BSS. BSS represents and
warrants to Xxxxx and the Stockholders as follows:
8.1 Organization. BSS is a Massachusetts corporation duly
organized, validly existing and in good standing under the laws of
Massachusetts and is qualified to conduct its business as it is presently
conducted. BSS has the requisite power and is duly authorized to carry on
its business where and as now conducted and to own, lease, use and operate
its properties as it now does.
8.2 Capacity. BSS has full authority and capacity to enter
into and to perform this Agreement in accordance with its terms, and
is not bound by or subject to any contractual or other obligation that
would be violated by the execution or performance of this Agreement,
and this Agreement is valid and binding upon BSS in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditor's rights in general.
8.3 Employee Benefit Plans. Attached hereto as Schedule 8.3 is
a true and complete description of all employee benefit plans,
programs or arrangements, written or unwritten, which BSS shall
provide to its employees, including, without limitation, any pension,
profit sharing or other retirement plans, any health and welfare
benefit plans, and plans, programs or arrangements for bonuses,
vacation and other leaves, severance and deferred compensation.
8.4 Litigation; Etc. Except as set forth on Schedule 8.4
attached hereto, there is no litigation, proceeding or governmental
investigation pending or to the knowledge of BSS, threatened, and
there is no order, injunction or decree outstanding against or
relating to BSS or the property, assets or business of BSS.
8.5 Accuracy of Representations. All statements contained in
any exhibit, schedule, certificate or other document delivered by or
on behalf of BSS pursuant to this Agreement or in connection with the
transactions contemplated hereby shall be deemed representations and
warranties hereunder by BSS. No representation or warranty by BSS in
this Agreement or in any exhibit, schedule, certificate or other
document delivered or to be delivered by BSS pursuant to this
Agreement or in connection with the transactions contemplated hereby
contains and will contain any untrue statement of a material fact, or
omits or will omit to state a material fact necessary to make the
statements contained therein not misleading.
9. CONDITIONS TO CLOSING; TERMINATION.
9.1 Conditions Precedent to Obligations of BSS. The Closing
and all obligations of BSS pursuant to this Agreement shall be
conditioned upon the following:
9.1.1 Representations and Warranties. All
representations and warranties of Xxxxx and the Stockholders
contained in Section 7 shall be true in all material respects as
of the Closing Date and BSS shall have received a confirmation
from an executive officer of Xxxxx, in form acceptable to BSS
and its counsel, to that effect.
9.1.2 No Material Changes. From the date hereof through
the Closing Date, the Xxxxx Business shall have been operated in
the ordinary course and there shall not have been:
9.1.2.1 Any change in the assets, liabilities,
business, prospects or condition (financial or otherwise)
of Xxxxx except changes in the ordinary course of
business, none of which shall have been materially
adverse.
9.1.2.2 Any damage, destruction or loss (whether
covered by insurance or not) materially or adversely
affecting the business or properties of Xxxxx.
9.1.2.3 Any general salary increase made for the
benefit of the employees of Xxxxx or any specific increase
in the salary of any employee of Xxxxx.
9.1.2.4 Any unusual commitment or liability
incurred, or any unusual acquisitions or purchases made,
by Xxxxx.
9.1.2.5 Any significant event or condition of any
character materially or adversely affecting the business
or prospects of Xxxxx.
9.1.3 Performance of Obligations. Xxxxx and the
Stockholders shall have performed all of their obligations under
this Agreement required to be performed as of the Closing Date,
including any obligations under Sections 11, 16, 17 and 18 to be
performed prior to the Closing.
9.1.4 Consents and Approvals. All consents, waivers,
authorizations and approvals of any governmental authority,
domestic or foreign, or of any other person, entity or
organization shall have been obtained, and the transactions
contemplated hereby shall not conflict with or result in any
breach or violation of the terms and conditions of, or
constitute (or with notice or lapse of time, or both,
constitute) a default under applicable federal, state, local or
foreign statute, regulation, order, judgment or decree.
9.1.5 Due Diligence. BSS shall have been satisfied with
its "due diligence" examinations of Xxxxx pursuant to Section /1
13.1.
9.1.6 Approval of BER Trustees and BSS Directors. The
BER Board of Trustees and the BSS Board of Directors shall have
approved and authorized (a) the execution and delivery of this
Agreement (b) the performance by BER and BSS of this Agreement
and all of the transactions contemplated hereby and (c) the
execution and performance of the other agreements and
instruments to be executed and delivered by BER and BSS as
provided herein.
9.1.7 Delivery of Documents. Xxxxx shall have delivered
all documents, certificates and any other instruments required
to be delivered by it pursuant to Section 10.2.
9.2 Conditions Precedent to Obligations of Xxxxx and the
Stockholders. The Closing and all obligations of Xxxxx and the
Stockholders pursuant to this Agreement shall be conditioned upon the
following:
9.2.1 Representations and Warranties. All
representations and warranties of BSS contained in Section 8
shall be true in all material respects as of the Closing Date
and Xxxxx and the Stockholders shall have received confirmation
from the President of BSS, in form acceptable to Xxxxx, the
Stockholders and their counsel, to that effect.
9.2.2 Performance and Obligations. BSS shall have
performed all of its obligations under this Agreement required
to be performed as of the Closing Date.
9.2.3 Consents and Approvals. All consents, waivers,
authorizations and approvals of any governmental authority,
domestic or foreign, or of any other person, entity or
organization shall have been obtained and the transactions
contemplated hereby shall not conflict with or result in any
breach or violation of the terms and conditions of, or
constitute (or with notice or lapse of time, or both,
constitute) a default under applicable federal, state, local or
foreign statute, regulation, order, judgment or decree.
9.2.4 Delivery of Documents. BSS shall have delivered
all documents, certificates and any other instruments required
to be delivered by it pursuant to Section 10.1.
9.3 Termination.
9.3.1 Termination by the Parties. This Agreement may be
terminated and the transactions contemplated hereby may be
abandoned prior to the Closing as follows:
9.3.1.1 At any time by the mutual written consent
of BSS, Xxxxx and the Stockholders.
9.3.1.2 By notice from BSS to Xxxxx and the
Stockholders if all of the conditions set forth in Section
9.1 shall not have been either (i) satisfied or (ii)
waived, on or prior to the Closing Date.
9.3.1.3 By notice from Xxxxx and the Stockholders
to BSS if all of the conditions set forth in Section 9.2
shall not have been either (i) satisfied or (ii) waived,
on or prior to the Closing Date.
9.3.1.4 By notice from BSS, Xxxxx or the
Stockholders to the others if for any reason the Closing
shall not have taken place on or before October 15, 1999;
provided, however, that any party may extend the closing
date up to and including October 22, 1999 after which time
this Agreement shall terminate.
9.3.2 Effect of Termination. If this Agreement shall be
terminated pursuant to Section 9.3.1, it shall become null and
void and of no further force or effect and no party to this
Agreement shall have any liability or further obligation to any
other party to this Agreement with respect to this Agreement or
the transactions contemplated hereby except as provided in
Section 9.3.3 and Section 15.11; provided, however, that no
termination of this Agreement pursuant to the provisions of
Section 9.3.1 shall relieve any party of liability for a breach
of any provision of this Agreement occurring prior to such
termination.
9.3.3 Return of Documents Upon Termination. In the event
of termination of this Agreement pursuant to Section 9.3.1, BSS,
Xxxxx and the Stockholders shall each return to the other party
any documents or copies thereof in possession of such party
furnished by the other party in connection with the transactions
contemplated by this Agreement.
10. TRANSACTIONS AT CLOSING. At the Closing, BSS, Xxxxx and the
Stockholders shall deliver to each other the documents, certificates and
other instruments set forth in this Section 10.
10.1 BSS's Deliveries. At or prior to the Closing, BSS shall
deliver to Xxxxx the following:
10.1.1 Trustee's Certificate. A copy of the resolutions
of the trustees of BER, certified as having been duly and
validly adopted and as being in full force and effect on the
Closing Date, authorizing the execution and delivery by BSS of
this Agreement, the other agreements and instruments to be
executed and delivered by BER and BSS as provided herein, and
the performance by BER and BSS of the transactions contemplated
hereby.
10.1.2 BSS Clerk's Certificate. A copy of the
resolutions of the directors of BSS, certified by its corporate
clerk or assistant clerk as having been duly and validly adopted
and as being in full force and effect on the Closing Date,
authorizing the execution and delivery by BSS of this Agreement,
the other agreements and instruments to be executed and
delivered by BSS as provided herein and the performance by BSS
of the transactions contemplated hereby.
10.1.3 Incumbency Certificates. A certified incumbency
and signature certificate for (a) the officers of BER and (b)
the officers of BSS.
10.1.4 Certificates of Good Standing. Certificates of
Good Standing issued by the Massachusetts Secretary of State as
to the good standing of BER and BSS.
10.1.5 Opinion of BER's and BSS's Counsel. The written
opinion of counsel for BER and BSS satisfactory in form and
substance to Xxxxx, the Stockholders and counsel for Xxxxx and
the Stockholders and substantially in the form of Exhibit 10.1.5
attached hereto, dealing with the matters set forth in Exhibit
10.1.5 and such other matters as Xxxxx, the Stockholders and
counsel for Xxxxx and the Stockholders may reasonably request.
10.1.6 Certificate of President. Certificate of the
President of BSS containing the confirmation described in
Section 9.2.1 that all representations and warranties of BSS
contained in Section 8 shall be true in all material respects as
of the Closing Date.
10.1.7 Employment Agreements. The employment agreements
between (a) BSS and Xxxxxxx and (b) BSS and Xxxxxx
(collectively, the "Employment Agreements"), in the forms of
Exhibits 10.1.7(a) and 10.1.7(b) attached hereto, executed by
BSS.
10.1.8 Management Operations Agreement. The Management
Operations Agreement among BER, BSS, Xxxxxxx and Xxxxxx in the
form attached as Exhibit A to the Employment Agreements (the
"MOA"), executed by BER and BSS.
10.1.9 Lease Agreements. The following lease agreements
(collectively, the "Lease Agreements"), executed by BSS:
10.1.9.1 Lease between BSS and Xxxxxx X. Xxxxx for
the premises located at 000 Xxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx, in the form of Exhibit 10.1.9.1 attached
hereto.
10.1.9.2 Lease between BSS and Xxxxxxx Xxxxx for
the premises located at 000 Xxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx, in the form of Exhibit 10.1.9.2 attached
hereto.
10.1.9.3 Assignment and Assumption of Lease dated
January 20, 1999 between Berkshire Bridge & Iron Co., Inc.
and Xxxxx for the premises located at 000 Xxxx Xxxxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, in the form of Exhibit
10.1.9.3 attached hereto.
10.1.10 Assignment and Assumption Agreement. The
Assignment and Assumption Agreement executed by BSS.
10.1.11 Other Documents. All such other documents,
certificates and instruments as Xxxxx, the Stockholders and
their counsel may reasonably request in connection with the
consummation of the transactions contemplated by this Agreement.
10.2 Xxxxx'x Deliveries. At or prior to the Closing, Xxxxx
shall deliver to BSS the following documents:
10.2.1 Corporate Resolutions. A copy of the resolutions
of the stockholders and directors of Xxxxx, certified by its
corporate clerk or assistant clerk as having been duly and
validly adopted and as being in full force and effect on the
Closing Date, authorizing the execution and delivery by Xxxxx of
this Agreement, the other agreements and instruments to be
executed and delivered by Xxxxx as provided herein, and the
performance by Xxxxx of the transactions contemplated hereby.
10.2.2 Incumbency Certificate. A certified incumbency
and signature certificate for the officers of Xxxxx.
10.2.3 Xxxx of Sale. A Xxxx of Sale, conveying all of
Xxxxx'x right, title and interest in the Purchased Assets to
BSS.
10.2.4 Certificate of Corporate Good Standing. A
Certificate of Good Standing issued by the Massachusetts
Secretary of State as to the corporate good standing of Xxxxx.
10.2.5 Certificate of Executive Officer. The Certificate
of an Executive Officer of Xxxxx containing the confirmation
described in Section 9.1.1 that all representations and
warranties of Xxxxx and the Stockholders contained in Section 7
shall be true in all material respects as of the Closing Date.
10.2.7 Opinion of Xxxxx'x Counsel. The written opinion
of counsel for Xxxxx and the Stockholders satisfactory in form
and substance to BSS and BSS's counsel and substantially in the
form of Exhibit 10.2.7 attached hereto, dealing with the matters
set forth in Exhibit 10.2.7 and such other matters as BSS and
BSS's counsel may reasonably request.
10.2.8 Employment Agreements. The Employment Agreements
executed by each of the Stockholders.
10.2.9 MOA. The MOA executed by each of the
Stockholders.
10.2.10 Lease Agreements. The Lease Agreements executed
by Xxxxxx X. Xxxxx, Xxxxxxx and Xxxxx, as the case may be.
10.2.11 Assignment and Assumption Agreement. The
Assignment and Assumption Agreement executed by Xxxxx.
10.2.12 Notes. The Notes executed by each of the
Stockholders.
10.2.13 Motor Vehicle Titles. Motor vehicle titles, free
of all encumbrances, for each of the motor vehicles listed on
Schedule 1 (a), executed by Xxxxx conveying all of Xxxxx'x
right, title and interest in the motor vehicles to BSS.
10.2.14 Xxxxxxxx Release. An executed release, in form
satisfactory to BSS's counsel, of Xxxxxx Xxxxxxxx releasing any
claim that he may have with respect to the Re-Bath Agreement.
10.2.15 Other Documents. All such other documents,
certificates and instruments as BSS and its counsel may
reasonably request in connection with the consummation of the
transactions contemplated by this Agreement.
11. EMPLOYEES. On the Closing Date, Xxxxx shall terminate all of
its employees currently employed in connection with the Xxxxx Business (the
"Employees") and BSS shall hire the Employees as Employees-at-Will, except
for Xxxxxxx, Xxxxxx and Xxxx Xxxxx (whose employment contract expires on May
11, 2000) for substantially the same wages and under terms of employment,
including fringe benefits, similar to their present terms of employment.
Xxxxx shall pay the Employees any accrued vacation pay owed on or before the
Closing Date.
12. INDEMNIFICATION.
----------------
12.1 Indemnification by Xxxxx. Xxxxx and each Stockholder
shall, jointly and severally, indemnify, defend and hold BSS and its
officers, directors, stockholders, agents, employees, representatives,
successors and assigns (collectively, the "BSS Indemnified Parties"),
harmless from and against any and all damage, loss, cost, obligation,
claims, demands, assessments, judgments or liability (whether based on
contract, tort, product liability, strict liability or otherwise),
including taxes, and all expenses, including, without limitation,
interest, penalties and reasonable attorneys' and accountants' fees
and disbursements (collectively, "Damages"), incurred by any of the
BSS Indemnified Parties, resulting from or in connection with any one
or more of the following:
12.1.1 Any breach of any representation or warranty made
by Xxxxx or any Stockholder in Section 7 of this Agreement,
excluding the representations and warranties with respect to
Inventory and Accounts Receivable.
12.1.2 Any failure to perform any covenant or agreement
made or undertaken by Xxxxx or any Stockholder in Sections 11,
16, 17 or 18 of this Agreement.
12.1.3 Any failure to perform any other covenant or
agreement made or undertaken by Xxxxx or any Stockholder in this
Agreement or in any other agreement delivered to BSS pursuant to
this Agreement.
12.1.4 Any services provided by Xxxxx prior to the
Closing Date.
12.1.5 Any third party claim for brokerage or finders'
fees or commissions based on any agreement between Xxxxx and
such third party that may have been made in connection with this
transaction.
12.1.6 Any failure of Xxxxx to pay or discharge the
liabilities of Xxxxx.
12.2 Survival. The obligations of Xxxxx and the Stockholders
under Sections 12.1.1 and 12.1.3 shall survive until December 31, 2001
and the obligations of Xxxxx and the Stockholders under Sections
12.1.2, 12.1.4, 12.1.5 and 12.1.6 shall survive indefinitely.
12.3 Indemnification by BSS. BSS shall indemnify, defend and
hold the Stockholders and Xxxxx and its officers, directors, agents,
employees, representatives, successors and assigns (collectively, the
"Xxxxx indemnified Parties"), harmless from and against any and all
Damages incurred by any of the Xxxxx Indemnified Parties, resulting
from or in connection with any one or more of the following:
12.3.1 Any breach of any representation or warranty made
by BSS in Section 8 of this Agreement.
12.3.2 Any failure to perform any covenant or agreement
made or undertaken by BSS in this Agreement or in any other
agreement delivered to Xxxxx or the Stockholders pursuant to
this Agreement.
12.3.3 Any failure of BSS to pay or discharge the Assumed
Liabilities.
12.3.4 Any third party claim for brokerage or finders'
fees or commissions based on any agreement between BER or BSS
and such third party that may have been made in connection with
this transaction.
12.3.5 Any services provided by BSS after the Closing
Date.
12.4 Survival. The obligations of BSS under Sections 12.3.1
and 12.3.2 shall survive until December 31, 2001 and the obligations
of BSS under Sections 12.3.3, 12.3.4 and 12.3.5 shall survive
indefinitely.
12.5 Effects of Insurance. If any party or parties who shall
have suffered Damages for which the other party or parties shall be
liable for indemnification pursuant to this Section 12 shall obtain
monetary recovery for such Damages under an insurance policy or from
any other third party, the amount of such monetary recovery shall be
deducted from the amount due from the indemnifying party or parties.
If an indemnified party's monetary recovery from a third party shall
be made after payment shall have been made by the indemnifying party
or parties, then the amount of such recovery shall be refunded to the
indemnifying party or parties, but only after and to the extent of the
amount of the recovery from such third party. An indemnified party
who shall have received a recovery for Damages arising from a breach
of a representation, warranty or covenant under this Agreement which
is subject to indemnification shall have no right to recover twice for
the same Damages under the indemnification provided in this Agreement.
12.6 Effects of Taxes. The amount of any Damages for which
Indemnification shall be provided pursuant to this Section 12 shall be
reduced to take account of any tax benefit actually realized by the
indemnified party as a result of the deductibility of such Damages.
For purposes of this Agreement, an indemnified party shall be deemed
to have "actually realized" a net tax benefit to the extent that the
amount of taxes payable by such indemnified party shall be reduced
below the amount of taxes that such indemnified party would have been
required to pay but for the deductibility of such Damages.
12.7 Right of Set-Off.
-----------------
12.7.1 Notice of Set-Off. Upon notice to the
Stockholders specifying in reasonable detail the basis for such
set-off (the "Set-Off Notice"), BSS may set off the amount of
any Damages to which it may be entitled pursuant to Section 12.1
of this Agreement or as a result of a breach of the MOA,
Employment Agreements, Lease Agreements or Notes (the "Set-Off
Amount") against payments otherwise payable to the Stockholders
under the Employment Agreements, excluding the Salary and fringe
benefits payable under Sections 6.1 and 6.3 of the Employment
Agreements, the MOA and the Lease Agreements, unless, within 20
days after the giving of the Set-Off Notice, the Stockholders
shall give BSS a notice stating that the Stockholders dispute
the claim underlying the proposed set-off (the "Dispute
Notice").
12.7.2 Escrow of Set-Off Amount. If a Dispute Notice
shall be given, BSS shall deposit the Set-Off Amount in escrow
with the Escrow Agents, to be held by the Escrow Agents in an
interest-bearing account until such time as (a) the Escrow
Agents shall receive a joint written notice from BSS and the
Stockholders instructing the Escrow Agent to release the Set-Off
Amount and accrued interest as specified in such notice or (b)
the dispute shall be adjudicated pursuant to a final
unappealable order of a court of competent jurisdiction, in
which event the Escrow Agents shall release the Set-Off Amount
and accrued interest in accordance with such order.
12.7.3 Indemnification of Escrow Agents. The Escrow
Agents shall not be liable for any action which they may in good
faith take or refrain from taking in connection herewith,
believed by them to be authorized or within the rights and powers
conferred upon them by this Section 12.7. The parties shall
jointly and severally indemnify and hold harmless the Escrow
Agents from and against any claims against them for any action
taken in good faith.
12.7.4 Authority of Escrow Agents. The Escrow Agents
shall be authorized to act upon any document, request or notice
which is believed by them in good faith to be genuine and signed
or presented by the proper party or parties, and shall be
protected in so acting.
12.7.5 Remedies. Neither the exercise of, nor the
failure to exercise, BSS's right of set-off pursuant to this
Section 12.7 shall constitute an election of remedies or limit
BSS in any manner in the enforcement of any other remedies that
may be available to it.
12.7.6 Exercise of Set-Off. The exercise of the right
of set-off set forth in this Section 12.7 by BSS in good faith,
whether or not ultimately determined to be justified, shall not
constitute a breach of this Agreement.
13. DUE DILIGENCE.
--------------
13.1 BSS's Due Diligence Examination. During the period of
time ending on October 13, 1999 (the "Due Diligence Period"), to the
extent not already delivered by Xxxxx, Xxxxx shall provide such
information concerning Xxxxx as BSS may request, including, without
limitation, the Articles of Organization of Xxxxx and any amendments
thereto, the By-Laws of Xxxxx, and all books, records, surveys,
accounting reports and other documents relating to Xxxxx and the
management and operation of the Xxxxx Business. Upon prior notice to
Xxxxx, BSS and its agents, attorneys, accountants, advisors,
appraisers, engineers, independent contractors and proposed credit
providers (collectively, "BSS's Agents") shall have the right during
the Due Diligence Period to (a) view, inspect and test the Purchased
Assets, the real estate on which the various offices of the Xxxxx
Business are located and their physical condition during regular
business hours and (b) interview the management and employees of Xxxxx
and Xxxxx'x customers; provided, however, that BSS shall request
Xxxxx'x prior approval (which shall not be unreasonably withheld) of
the persons to be interviewed and the estimated length of interviews.
All examinations, inquiries and investigations conducted by BSS and
BSS's Agents shall be conducted in such a manner as to minimize the
disruption of the Xxxxx Business to the extent reasonably practicable.
13.2 Xxxxx'x Due Diligence Examination. During the Due
Diligence Period, to the extent not already delivered by BSS, BSS
shall provide to Xxxxx a disclosure package consisting of copies of
the following: (a) BSS's employee benefit plans and policies and
(b)BSS's Articles of Organization and By-Laws.
14. PROFESSIONAL FEES. Each of BER and Xxxxx shall bear the cost
of all fees, expenses and disbursements due its own attorneys, accountants
and appraisers.
15. MISCELLANEOUS PROVISIONS.
15.1 Severability. If any provision of this Agreement shall be
deemed by any court having jurisdiction thereon to be invalid or
unenforceable, the balance of this Agreement shall remain in effect;
if any provision of this Agreement shall be deemed by any such court
to be unenforceable because such provision shall be too broad in
scope, such provision shall be construed to be limited in scope to
the extent such court shall deem necessary to make it enforceable; and
if any provision shall be deemed inapplicable by any such court to any
person or circumstances, it shall nevertheless be construed to apply
to all other persons and circumstances.
15.2 Assignment. This Agreement and any rights granted
hereunder may not be assigned or otherwise transferred by any party
without the prior consent of the other parties.
15.3 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors and
assigns but shall not be assignable except as set forth in Section
15.2.
15.4 Entire Agreement. This Agreement contains a complete
statement of the undertakings between the parties with respect to its
subject matter, cannot be changed or terminated orally, and supersedes
all prior agreements and undertakings. There is no representation not
set forth in this Agreement (including the Schedules and Exhibits
hereto) which have been relied upon by the parties.
15.5 Notice. Any notice, approval, consent or other
communication under this Agreement shall be in writing and shall be
considered given when (1) delivered personally, or (2) mailed by
registered or certified mail, return receipt requested or (3)
transmitted by telecopy with a confirming copy sent by overnight mail
or courier service, return receipt requested, to the parties at the
addresses indicated below (or at such other address as a party may
specify by notice to the others pursuant hereto). Notice given by a
party's counsel shall be considered notice given by that party.
(a) If to BER, to it at:
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx, President
Telecopy No. 000-000-0000
(b) If to Xxxxx, to it at:
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telecopy No. 000-000-0000
(c) If to Xxxxxxx, to him at:
000 Xxxxx Xxxx
Xxxxxxxxxxx, XX 00000
(d) If to Xxxxxx, to him at:
0 Xxxxxxx Xxxx
Xxxxxx, XX 00000
(e) In each case, with a copy to:
Xxxx X. Xxxxxx, Xx., Esquire
XXXXXX & XXXXXXXX, LLP
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Telecopy No. 000-000-0000
and
C. Xxxxxxx Xxxx, Esquire
CAIN, HIBBARD, XXXXX & XXXX, P.C.
00 Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telecopy No. 000-000-0000
15.6 Modifications. This Agreement may not be modified except
by a writing signed by all of the parties hereto.
15.7 Further Assurances.
-------------------
15.7.1 From time to time after the Closing, each party
shall, at the request of the other party, execute and deliver
such documents and take such actions as may be necessary to
implement the transactions contemplated by this Agreement.
15.7.2 Except for the Assumed Liabilities, Xxxxx shall
promptly pay, within 30 days of the Closing, all disclosed or
undisclosed liabilities of Xxxxx in existence as of the Closing
Date.
15.8 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original
and all of which taken together shall constitute one and the
same agreement.
15.9 Governing Law; Effect. This Agreement shall be
governed by and construed in accordance with the substantive law of
the Commonwealth of Massachusetts, without giving effect to the
conflicts or choice of law provisions of Massachusetts or any other
jurisdiction, and shall have the effect of a sealed instrument.
15.10 No Waiver. Each party hereto may, by written notice to
the other parties hereto: (a) extend the time for the performance of
any of the obligations or other actions of such other party under this
Agreement; (b) waive any inaccuracies in the representations,
warranties, conditions or covenants of such other party contained in
this Agreement; or (c) waive or modify performance of any of the
obligations of such other party under this Agreement. Except as
provided in the foregoing sentence, no waiver of the performance or
breach of, or default under, any condition or obligation hereof shall
be deemed to be a waiver of any other performance, or breach of, or
default under the same or any other condition or obligation of this
Agreement.
15.11 Confidentiality.
----------------
15.11.1 Confidential Information. In connection with the
transaction contemplated by this Agreement, BSS, Xxxxx and the
Stockholders shall be exchanging certain confidential
information regarding their respective businesses, including
financial statements, reports, summaries of operations,
projections, customer lists and information, employee lists,
policy statements and other information relating to such
businesses (collectively, "Confidential Information").
Confidential Information shall include written and oral
statements, documents and materials relating to BSS, Xxxxx and
the Stockholders that shall be divulged by BSS, Xxxxx and the
Stockholders and their agents, attorneys, accountants and
advisors or that shall otherwise come into the possession of
BSS, Xxxxx and the Stockholders, as the case may be. BSS, Xxxxx
and the Stockholders shall maintain the Confidential Information
of the other party in strict confidence. Without the prior
written authorization of BSS, Xxxxx and the Stockholders, as the
case may be, none of the Confidential Information shall be (a)
copied or (b) disclosed to any other party. The obligations of
the parties set forth in this Section 15.11.1 shall survive the
termination of this Agreement.
15.11.2 Confidentiality of Terms and Conditions. Each
party shall maintain confidential the terms and conditions of
this Agreement and not disclose any of such terms and conditions
to any third party without the prior written consent of the
other parties hereto.
15.12 Non-Solicitation. During the period commencing on the
date of this Agreement and ending on the Closing Date, Xxxxx shall not
permit or take any action to encourage, solicit, engage in discussions
or negotiations with, or provide any information to, any person, firm,
or other entity or group (other than BSS or its representatives)
concerning any merger, consolidation, sale of substantial assets,
purchase or sale of shares of capital stock or other similar
transaction involving Xxxxx.
15.13 Survival. This Agreement shall survive the Closing.
16. CORPORATE PLUMBER'S LICENSE. From and after the Closing
until the expiration or earlier termination of his Employment Agreement
("Darrell's Term"), Xxxxxxx shall be obligated, at no additional
compensation from BSS, to make available to BSS his master plumber's license
to support the issuance of the corporate plumber's license required for the
operation of the MC Business. If for any reason Darrell's license shall not
be available at any time during Darrell's Term, Xxxxxxx shall immediately
engage, at no additional expense to BSS, another license holder to support
BSS's corporate license so that at no time during Darrell's Term shall BSS
have to suspend operations because of lack of the required license. Xxxxxxx
shall be responsible for any legal fees, fines or penalties incurred by or
imposed against him or Xxxxx in connection with the action currently pending
before the Board of the State Examiners of Plumbers and Gasfitters. Xxxxxxx
acknowledges that the indemnification set forth in Section 12.1 covers this
Section 16.
17. INDEMNIFICATION FOR XXXXX LITIGATION. From and after the
Closing, at no cost to BSS, Xxxxx and the Stockholders shall endeavor to
resolve and dispose of each of the litigation matters described on Schedule
7.8. In all cases, Xxxxx and the Stockholders shall be responsible for any
settlement, fines, interest, penalties or legal fees incurred in connection
with the resolution of said matters.
18. RE-BATH AGREEMENT. From and after the Closing, Xxxxx and the
Stockholders shall take all action necessary to enable BSS to sell and
install Re-Bath products in the same manner as done by Xxxxx prior to the
Closing, including the assignment of Xxxxx'x interest in the Dealership
Agreement dated November 1, 1993 between Re-Bath Corporation and Xxxxx (the
"Re-Bath Agreement") to BSS.
Signed and sealed on the date first written above.
BERKSHIRE SERVICE SOLUTIONS, INC.
By /s/ Xxxxxx X. Xxxxxxxx
--------------------------------
Its President
XXXXX, INC.
By /s/ Xxxxxxx Xxxxx
--------------------------------
Its President
/s/ Xxxxxxx Xxxxx
--------------------------------
XXXXXXX XXXXX
/s/ Xxxxxx X. Xxxx
-------------------------------------
XXXXXX X. XXXX
