Exhibit 10.27
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AGREEMENT OF SALE
THIS AGREEMENT OF SALE ("Agreement") is made this 8th day of November, 2002,
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between J.G. Petrucci Company, Inc. or its Assigns, a New Jersey corporation
("Buyer") and Paragon Technologies, Inc., a Delaware corporation, as successor
in interest to SI Handling Systems, Inc. ("Seller"). This Agreement is to be
effective as of the date on which Buyer receives this Agreement signed by Seller
(the "Effective Date").
In consideration of the covenants and provisions contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Agreement to Sell and Purchase. Seller agrees to sell to Buyer, and Buyer
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agrees to purchase from Seller, subject to the terms and conditions of this
Agreement, that certain tract or piece of land known as 600 Kuebler Road,
consisting of an approximately 173,000 s/f building on approximately 20
acres located in Easton, Pennsylvania as more fully described by metes and
bounds in the legal description attached hereto as Exhibit "A," being all
of the property owned by Seller in that location, together with all right,
title, and interest of Seller in and to any land lying in the bed of any
highway, street, road, or piece of land and any easements and appurtenances
pertaining thereto (the "Real Property") and all the buildings and other
improvements situate thereon, including all fixtures, equipment,
appliances, and other personal property attached or appurtenant to, located
in or on, or used in connection with the Real Property (the "Personal
Property") (the Real Property and the Personal Property are jointly called
(the "Property").
2. Purchase Price. The purchase price for the Property is Three Million and
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00/XX Dollars ($3,000,000.00) (the "Purchase Price"), payable as follows:
(a) a deposit of One Hundred Fifty Thousand and 00/XX ($150,000.00)
Dollars ("Deposit") shall be held by Fidelity National Title Insurance
Company located in Philadelphia, Pennsylvania ("Fidelity") in an
interest bearing account for which Fidelity shall serve as the Escrow
Agent and shall incur no liabilities other than for the Deposit pending
the Settlement. The Deposit shall be applied against the Purchase Price
at Settlement subject to the earlier termination of this Agreement as
provided herein; and
(b) the balance of Two Million Eight Hundred Fifty Thousand and 00/XX
($2,850,000.00) shall be paid in cash or wired funds to an account
designated by Seller at Settlement.
3. Settlement. Settlement shall be held on the date which is fifteen (15) days
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after the expiration of the Due Diligence Period (as defined below) (or on
the next business day thereafter if such date is not a business day), or on
such earlier date as Buyer shall designate by at least five (5) days'
advance written notice to Seller, at Buyer's office
at 171 Route 173, Suite 201, Asbury, New Jersey 08802, at 10:00 a.m. or
such other time and place mutually acceptable to Buyer and Seller
("Settlement"). It is agreed that the time of Settlement and delivery
of the Purchase Price by Buyer and the obligation of Seller to deliver
the Deed (as hereinafter defined) at Settlement are of the essence of
this Agreement.
4. Condition of Title.
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(a) Buyer shall within five (5) days from the Effective Date, order a
title report for the Property from Buyer's chosen title company. Title
to the Property shall be good and marketable (i) free and clear of all
liens, restrictions, easements, encumbrances, claims or liens by
contractors, subcontractors, mechanics and materialmen, leases,
financing statements or other personal property liens or encumbrances
and other title objections, other than title exceptions listed on
Schedule B-II of the title report and such other title exceptions as
may be approved by Buyer within fourteen (14) business days after
Buyer receives its title report for the Property, (ii) affirmatively
insured as contiguous with no gaps or gores, and (iii)
insurable as aforesaid at ordinary rates by Commonwealth Land Title
Insurance Company or any other title insurance company selected by
Buyer. There shall be no exception for possible mechanics liens or
possible unsettled taxes of any kind against Seller or the Property.
Seller shall pay and discharge all monetary liens of an ascertainable
amount at or before Settlement; if Seller fails to do so, Buyer shall
have the option, at its election, to pay and discharge such monetary
liens, and all such amounts paid by Buyer shall be a credit against
the Purchase Price. Buyer shall promptly forward a copy of the title
report to Seller upon Buyer's receipt of such report.
(b) If title to the Property cannot be conveyed to Buyer at Settlement
in accordance with the requirements of this Agreement for a reason
other than the existence of any lien on the Property for an amount
not in excess of the Purchase Price, Seller shall take appropriate
action to cure the defect, and at Buyer's option Settlement may be
postponed for a reasonable time, not exceeding thirty (30) days,
to permit Seller to cure the title deficiency. If the title
deficiency is of such a nature that it is not capable of being cured
by Seller, Buyer shall have the option (i) of taking such title as
Seller can convey without abatement of the Purchase Price, or (ii)
of terminating Buyer's obligations under this Agreement,
having the Deposit (with any accrued interest) returned to it and
being reimbursed by Seller for all reasonable out-of pocket costs and
expenses incurred by Buyer in connection with this Agreement and the
Property, including but not limited to title company charges,
consultant fees for due diligence tests, and other similar charges
("Buyer's Reasonable Costs").
5. Representations and Warranties. Seller, to induce Buyer to enter into this
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Agreement and to complete the sale and purchase of the Property hereunder,
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represents, warrants, and covenants to Buyer as follows:
(a) Seller has no actual knowledge of, and has received no notice from
any governmental authority requiring any work, repairs,
construction, alterations, or installations on or in connection
with the Property, or ordinances, codes, orders, regulations, or
requirements affecting any portion of the Property, including,
without limitation, any applicable environmental laws or
regulations. There is no action, suit, or proceeding pending or,
to the knowledge of Seller, threatened against or affecting Seller
or the Property or any portion thereof or relating to or arising
of the ownership of the Property, in any court or before or by any
federal, state, county, or municipal department, commission,
board, bureau, or agency or other governmental instrumentality.
(b) No assessments or charges for any public improvements have been
made against the Property which remain unpaid, no improvements to
the Property or any roads or facilities abutting the Property have
been made or, to the actual knowledge of Seller, ordered for which
a lien, assessment, or charge can be filed or made and Seller has
no actual knowledge of any plans for improvements by any
governmental or quasi-governmental authority which might result in
a special assessment against the Property. Seller has incurred no
obligations relating to the installation of or connection to any
sanitary sewers or storm sewers which shall be enforceable against
the Property, and all public improvements commenced, or completed
prior to the Effective Date shall be paid in full by Seller prior
to Settlement.
(c) The Property has been duly subdivided in accordance with all
applicable laws and constitutes an independent tract of land for
all applicable zoning, subdivision, and taxation purposes.
(d) The Property is serviced by public water, public sewer, gas, and
electric.
(e) Except as listed on Exhibit "B" attached hereto and made a part
hereof, Seller has received no notice from any insurance company
which has issued a policy with respect to the Property or by any
board of fire underwriters (or other body exercising similar
functions) claiming any defects for deficiencies or requesting the
performance of any repairs, alterations or other work, and Seller
will promptly notify Buyer of and comply with any such notice or
requirement at Seller's cost if such notice is received prior to
Settlement.
(f) Except as listed on Exhibit "C", attached hereto and made a part
hereof, there are no management, employment, service, equipment,
supply, maintenance, water, sewer, or other utility or concession
agreements escrows or bonds with respect to or affecting the
Property which will burden the Property or Buyer after Settlement
in any manner whatsoever, except for instruments of record.
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(g) To Seller's actual knowledge all roads abutting the Property are
dedicated public roads and the deed to be delivered to Buyer at
Settlement hereunder is the only instrument necessary to convey to
Buyer (i) full access to and right to freely use such roads, and
(ii) all rights appurtenant to the Property in such roads.
(h) To Seller's actual knowledge, the Property has not been registered
or certified as "historic" by any local, state, or federal
governmental entity or historic commission.
(i) Except as disclosed on the Survey, there are no wetlands
restrictions or riparian rights affecting the Property and no
portion of the Property is within the boundaries of the 100 year
flood plain.
(j) Seller or the Easton Area Industrial Development, Inc. ("EAID"),
holds fee simple title to the Property. Seller is a duly existing
Delaware corporation and has the power and authority to enter in
this Agreement and to consummate the transaction herein
contemplated.
(k) No representation, statement, or warranty by Seller contained in
this Agreement or in any exhibit attached hereto contains or will
contain any untrue statements or omits or will omit a material
fact necessary to make the statement of fact therein recited not
misleading. If, after Seller's execution hereof, any event occurs
or condition exists which renders any of the representations
contained herein untrue or misleading in any material way, Seller
shall promptly notify Buyer.
(l) No brokerage or leasing commissions or other compensation is or
will be due or payable to any person, firm, corporation, or other
entity with respect to or on account of any of the Leases or any
extensions or renewals thereof, if any.
(m) Except to the extent of the space to be occupied by Seller in
accordance with the Lease attached hereto as Exhibit "D", the
Property will be delivered to Buyer vacant and except for the
Lease contemplated by Section 24 of this Agreement there will be
no leases or other agreements in place affecting the Property. No
former tenant, licensee or other occupant under any prior leases
or other agreements has, nor does any other party have, any right
or option to acquire the Property or any portion thereof.
(n) Neither the execution and delivery of this Agreement, nor
compliance with the terms and conditions of this Agreement by
Seller, nor the consummation of the transaction contemplated
herein, constitutes or will constitute a violation or breach of
the articles of Incorporation or By-Laws of Seller, or of any
agreement or other instrument to which it is a party, to which it
is subject or by which it is bound.
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(o) The execution and delivery of this Agreement have been approved by
the authorized officers of Seller and no further corporate action
is required on the part of Seller to consummate the transaction
contemplated hereby. The officers executing this Agreement on
behalf of Seller have all requisite authority to execute this
Agreement, and this Agreement, as executed is valid, legal, and
binding upon Seller. There are no proceedings pending or
threatened by or against Seller in bankruptcy, insolvency, or
reorganization in any state or federal court.
6. Representations and Warranties of Buyer. Buyer hereby represents
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and warrants to, and covenants with Seller, as follows:
(a) Buyer is a New Jersey corporation, duly organized, validly
existing and good standing under the laws of the State of New
Jersey, is qualified to do business in Pennsylvania and has the
authority to enter into and consummate its obligations under this
Agreement.
(b) Buyer has the power and authority to enter into this Agreement,
and the execution, delivery and performance of this Agreement have
been duly authorized by Buyer.
(c) Neither its entering into this Agreement nor its consummation of
the transactions contemplated hereby does or will violate any
provision of Buyer's Articles of Incorporation or by-laws or any
indenture, agreement or order by which Buyer is bound, or any
rule, order or law applicable to Buyer.
7. Conditions of Buyer's Obligations. The obligation of Buyer under this
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Agreement to purchase the Property from Seller is subject to the
satisfaction at Settlement of each of the following conditions (any one
of which my be waived in whole or in part by Buyer at or prior to
Settlement):
(a) All of the representations and warranties by Seller set forth in
this Agreement shall be true and correct at and as of Settlement
in all respects as though such representations and warranties were
made at and as of Settlement, and Seller shall have performed,
observed, and complied with all covenants, agreements, and
conditions required by this Agreement to be performed on its part
prior to or as of Settlement.
(b) Due Diligence Period.
(i) Buyer shall have a period from the Effective Date through
the date, which is sixty (60) days thereafter (the "Due
Diligence Period") to conduct due diligence investigations,
including but not limited to soils testing and analysis of
the Property and all information pertaining to the Property.
If Buyer, in its sole discretion, determines that it does
not desire
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to acquire the Property, with or without reason,
and notifies Seller in writing by 5:00 p.m. on the last day
of the Due Diligence Period of its election to terminate,
this Agreement thereupon shall become void, the Deposit
shall be returned to Buyer with interest and there shall
be no further obligation or liability on either of the
parties hereto. If Buyer terminates this Agreement, Buyer
shall promptly return to Seller all copies and originals of
all due diligence reports obtained by Buyer and all copies
of reports and other information given to Buyer by Seller.
Buyer shall not be permitted to retain any copies of the
foregoing information unless otherwise approved by Seller.
(ii) Buyer acknowledges that all of Buyer's investigations and
testing of the Property are undertaken by Buyer at Buyer's
sole risk, cost and expense. Buyer shall indemnify, defend
and hold harmless the Seller from and against any claim,
loss, cost, liability, judgment settlement, damage or
expense, including, without limitation, reasonable
attorney's fees and legal costs, caused by Buyer or Buyer's
designees conducting any investigations or testing which
Buyer undertakes in connection with the Property. This
indemnification shall survive any termination or expiration
of this Agreement
(c) Within twenty (20) days after the Effective Date, Seller shall
deliver to Buyer copies of all of the following documents
currently in Seller's possession, if available:
(i) The latest as-built plans or surveys (the "Survey") of the
Property prepared by a registered and licensed surveyor;
(ii) Copies of the floor plans of all buildings on the
Property;
(iii) Copies of all service contracts with respect to the
Property;
(iv) Copies of the latest environmental reports with respect
to the Property which are in Seller's possession; and
(v) Copies of the latest title commitment and title policy
with respect to the Property, which are in Seller's
possession.
(d) EAID Issues. Seller shall act in good faith to resolve any existing
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title issues concerning the Property with the EAID including, if necessary,
filing a corrective deed in the Recorder of Deeds Office in and for Northampton
County. Seller shall provide Buyer with weekly updates as to the status of this
resolution.
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(e) At Settlement, Seller shall deliver or caused to be delivered to
Buyer duly executed originals of the following:
(i) A Special Warranty Deed duly executed and acknowledged by
Seller and in proper form for recording (the "Deed");
(ii) A valid bill of sale for the Personal Property as listed
on Exhibit "G";
(iii) An assignment in form and substance mutually
satisfactory to Seller and Buyer, duly executed by Seller,
assigning to Buyer all of Seller's right, title, and interest
in and to (A) any and all guaranties and warranties, if any,
pertaining to the Property; and (B) any permits, licenses,
plans authorizations, approvals relating to ownership,
operation, or occupancy of the Property;
(iv) Originals or copies, if available, of the following
instruments, all certified by Seller as true and correct to
the best knowledge of Seller:
(A) All certificates of occupancy (and any required
governmental approvals in connection with the
transfer of the Property), licenses, plans,
permits, authorizations, and approvals required
by law and issued by all governmental authorities
having jurisdiction over the Property
(B) All building records in Seller's possession or control
with respect to the Property;
(C) Each bill of current real estate taxes, sewer charges and
assessments, water charges, and other utilities; and
(D) All assigned guarantees and warranties;
(v) Except for any keys required to access Seller's leased
space in which event copies of keys will be provided to
Buyer, all keys and combinations to locks at the Property,
all plans, specifications, as-built drawings, surveys, site
plans, equipment manual, technical data, and other
documentation relating to the building systems, equipment,
and any other personal property forming part of the Property
or any portion thereof in possession of Seller or any
property manager(s);
(vi) An affidavit of title in favor of Buyer and Buyer's title
insurer in the form used by such title insurance company;
(vii) A letter from the Township or other local governing body
confirming the present zoning of the Property and stating that
there are on outstanding
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violations of laws, ordinances, or regulations issued against the
Property, and otherwise in the form of Exhibit "E" attached hereto;
(viii)Such other documents as reasonably may be required to
consummate this transaction accordance with this Agreement.
Unless all of the foregoing conditions contained in this Paragraph 7
are satisfied within the time period specified, or if no time period is
specified, prior to or at Settlement, Buyer, at its election, may, either (i)
extend the date for Settlement until such conditions are satisfied or (ii) waive
in writing the satisfaction of any such conditions, in which event this
Agreement shall be read as if such conditions no longer existed.
8. Conditions of Seller's Obligations. The obligation of Seller under this
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Agreement to convey title to the Property to Buyer is subject to the
satisfaction at Settlement of each of the following conditions:
(a) Delivery by Buyer of the Purchase Price;
(b) Delivery of such other documents as reasonably may be required
to consummate this transaction accordance with this Agreement.
(c) The representations and warranties of Buyer in this Agreement
shall be true and correct in all material respects as of
Settlement and Buyer shall have performed all covenants and
obligations required to be performed by Buyer under this
Agreement.
9. Possession. Except for the portion of the Property to be leased by Seller
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pursuant to the provisions of Section 24 hereof, possession of the Property
shall be given to Buyer at Settlement unoccupied and free of any liens.
Prior to Settlement hereunder, Seller shall clean the Property of trash,
debris, equipment (except equipment which Buyer and Seller agree shall
remain on the Property, as listed on Exhibit "G" attached hereto and made a
part hereof, vehicles, toxic waste, and billboards, whether on the surface
or buried below.
10. Apportionments; Taxes.
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(a) Real estate taxes, all utilities, operating expenses, and other
apportionable income and expenses paid or payable by Seller shall
be apportioned prorata on a per diem basis as of Settlement.
Taxes, and additional rent paid on account thereof, shall be
apportioned based on the fiscal year of the taxing authority.
Seller shall cause any and all public utilities serving the
Property to issue final bills to Seller on the basis of readings
made as of Settlement, and all such bills shall be paid by Seller.
(b) All realty transfer taxes imposed on or in connection with this
transactions shall be shared equally by Seller and Buyer.
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11. Condemnation. Seller covenants and warrants that Seller has not heretofore
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received any notice of any condemnation proceeding or other proceeding in
the nature of eminent domain in connection with the Property. If prior to
Settlement any such proceeding is commenced or any change is made, or
proposed to be made, to the current means of ingress and egress to the
Property or the roads or driveways adjoining the Property, or to change
such ingress or egress or to change the grade thereof, Seller agrees
immediately to notify Buyer thereof. Buyer then shall have the right, at
Buyer's option, to terminate this Agreement by giving written notice to
Seller within thirty (30) days after receipt of such notice. If Buyer does
not so terminate this agreement, Buyer shall proceed to Settlement
hereunder as if no such proceeding had commenced and will pay Seller the
full Purchase Price in accordance with this Agreement; Seller shall assign
to Buyer all of its right, title, and interest in and to any compensation
for such condemnation, Seller shall not negotiate or settle any claims for
compensation prior to Settlement, and Buyer shall have the sole right (in
the name of Buyer or Seller or both) to negotiate for, to agree to, and to
contest all offers and awards.
12. Default by Buyer. If Buyer, without the right to do so and in default of
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its obligation hereunder, fails to complete Settlement, the Deposit and all
accrued interest shall be paid to Seller. Such payment of the Deposit and
all accrued interest to Seller shall be deemed to be liquidated damages for
Buyer's default and the receipt of same shall be Seller's exclusive and
sole remedy, and Seller hereby waives any right to recover the balance of
the Purchase Price, or any part thereof, and the right to pursue any other
remedy permitted at Law or in equity against Buyer.
13. Default by Seller.
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If Seller, without the right to do so and in default of its obligations
hereunder, fails to complete Settlement, the Deposit and all accrued
interest shall be returned to Buyer or Buyer may sue for specific
performance.
14. Risk of Loss. Seller shall bear the risk of all loss or damage to the
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Property from all causes, except for losses or damages caused by Buyer's or
Buyer's agents performing any due diligence on behalf of Buyer, negligence
or willful misconduct until Settlement. Seller represents that it has, and
will maintain pending Settlement, a policy of fire and extended coverage
insurance in at least the full amount of the replacement cost of all
buildings and improvements located on the Property. Seller will deliver to
Buyer within fifteen (15) days after the Effective Date a certificate
issued by such insurer evidencing that such policy is in effect, that it
will not be canceled without at least ten (10) days' prior notice to Buyer.
If at any time prior to Settlement any portion of the Property is destroyed
or damaged as a result of fire or any other casualty whatsoever, Seller
shall promptly give written notice thereof to Buyer and Buyer shall have
the right (i) to terminate this Agreement by written notice to Seller,
whereupon Escrow Agent shall return the Deposit (with any accrued interest)
to Buyer, and thereafter this Agreement shall be void and neither party
shall have any further rights or
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obligations hereunder; or (ii) to proceed with this Agreement and to
notify Seller that, at Buyer's sole option, Seller either shall (A) use
any available insurance proceeds to restore the Property prior to
Settlement to its condition as of the Effective Date, and
if there are any excess insurance proceeds after completion of such
restoration, such proceeds shall be kept by Seller; or (B) in lieu of
restoration, prior to Settlement, clear the site of debris and deposit all
remaining insurance proceeds in escrow with Escrow Agent and such funds,
together with interest thereon, shall be disbursed to Buyer at Settlement.
All unpaid claims and rights in connection with any such losses shall be
assigned to Buyer at Settlement without in any manner affecting the
Purchase Price.
15. Signs. Seller hereby consents to the placing of signs upon the Property by
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Buyer; provided, however, that such signs shall be in compliance with all
zoning and other regulations governing the Property and the specifications
for any such sign must first be submitted to Seller for its approval, which
approval shall not be unreasonably withheld or delayed. If Settlement is
not made hereunder, Buyer shall remove such signs at Buyer's expense and
restore the Property to its condition existing prior to installation of the
signs. The parties hereto agree that Seller's identification sign on the
Property shall remain during the term of the lease as provided in Section
24 hereof.
16. Brokerage. Buyer represents and warrants to Seller and Seller represents
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and warrants to Buyer that each dealt with no broker, agent, finder, or
other intermediary in connection with this sale and purchase other than
Gelcor GVA Worldwide for whose commission Seller shall be solely
responsible if and when Settlement takes place out of the proceeds thereof
and Beacon Commercial Real Estate for whose commission Buyer shall be
solely responsible. The parties agree to indemnify, defend, and hold each
other harmless from and against the claims of any and all brokers and other
intermediaries claiming a commission through that party in connection with
this sale.
17. Operation of the Property Prior to Settlement. Prior to Settlement:
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(a) The Property shall be operated, managed, and maintained in a
reasonable, professional, and prudent manner, and kept in
reasonably good condition at all times, ordinary wear and tear
excepted.
(b) At reasonable times following reasonable notice, Buyer, its
accountants, architects, attorneys, engineers, contractors, and
other representatives shall be afforded reasonable access to the
Property to inspect, measure, appraise, test, and make surveys of
the Property.
(c) Seller promptly shall notify Buyer of Seller's receipt of any
notice from any party alleging that Seller is in default of its
obligation under any permit or agreement affecting the Property,
or any portion or portions thereof.
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(d) No contract for or on behalf of or affecting the Property shall be
negotiated or entered into which cannot be terminated by Seller
prior to Settlement without charge, cost, penalty, or premium,
without Buyer's prior consent.
(e) Except with the prior written consent of Buyer, Seller shall not enter
into any new leases for any portion of the Property; any new lease
shall be on a form of lease supplied to Seller by Buyer. In the event
Buyer approves any new leases, Seller shall deliver to Buyer an
estoppel certificate from the tenant (s) and guarantor (s) thereunder
as required hereunder for the leases and otherwise shall comply, as to
such new leases and new guaranties, with the terms of this Agreement.
Further, except with the prior written consent of Buyer, Seller shall
not amend, extend, terminate, accept surrender of, or permit any
assignments or subleases of, any of the leases nor accept any rental
more than one (1) month in advance or accelerate the rent due to any
tenant default under any of the leases.
18. Notice. All notices, requests, and other communications under this
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Agreement shall be in writing and shall be delivered (i) in person, (ii) by
registered or certified mail, return receipt requested, or (iii) by
recognized overnight delivery service providing positive tracking of items
(for example, Federal Express), addressed as follows or at such other
address of which Seller or Buyer shall have given notice as herein
provided:
If intended for Seller:
Paragon Technologies, Inc.
600 Kuebler Road
Easton, PA 18040
Attention: William R. Johnson
Telephone: 610-252-3205
with a copy to:
Pepper Hamilton, LLP
400 Berwyn Park
899 Cassatt Road
Berwyn, PA 19312
Attention: Cuyler H. Walker, Esquire
Telephone: 610-640-7823
If intended for Buyer:
J.G. Petrucci Company, Inc.
171 Route 173, Suite 201
Asbury, NJ 08802
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Attention: Gregory T. Rogerson, Esq.
Telephone: 908-730-6909
All such notices, requests, and other communications shall be deemed to have
been sufficiently given for all purposes hereof only upon receipt by the party
to whom which notice is sent. Notices by the parties may be given on their
behalf by their respective attorneys.
19. AS-IS Condition of Property. Except as otherwise expressly provided in this
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Agreement or any documents to be delivered to Buyer at Settlement the
Seller disclaims the making of any representations or warranties, express
or implied, regarding the Property or matters affecting the Property,
whether made by the Seller, on the Seller's behalf or otherwise, including,
without limitation, the physical condition of the Property, title to or the
boundaries of the Real Property, pest control matters, soil conditions, the
presence, existence or absence of Hazardous Substances, hazardous wastes,
toxic substances, or other environmental matters, compliance with
environmental statues, building, health, safety, land use and zoning laws,
regulations and orders, structural and other engineering characteristics,
traffic patterns, market data, economic conditions or projections, and any
other information pertaining to the Property. The Buyer acknowledges (a)
that Buyer has entered into this Agreement with the intention of making and
relying upon its own investigations or that of third parties selected by
Buyer with respect to the physical, environmental, economic and legal
condition of the Property, and (b) that the Buyer is not relying upon any
statements, representation or warranties of any kind, other than those
specifically set forth in this Agreement or in any document to be delivered
to the Buyer at Settlement made (or purported to be made) by the Seller or
any one acting or claiming to act on the Seller's behalf. The Buyer further
acknowledges that it has not received from or on behalf of the Seller any
accounting, tax, legal, architectural engineering, property management or
other advice with respect to this transaction and is relying solely upon
the advice of third party accounting, tax, legal, architectural
engineering, property management and advisors of Buyer. Subject to the
provisions of this Agreement, the Buyer shall purchase the Property in its
"as is" condition and "with all faults" at Settlement.
20. Further Assurance. After Settlement, at Buyer's sole cost and expense,
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Seller shall execute, acknowledge, and deliver, for no further
consideration, all assignments, transfers, deeds, and other documents as
Buyer may reasonably request to vest in Buyer and perfect Buyer's right,
title, and interest in and to the Property.
21. Environmental Representations, Warranties and Covenants. Except as set
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forth in Exhibit "F":
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(a) The business of Seller is being conducted and has at
all times prior to the date of Settlement been
conducted in compliance with all applicable
Environmental Laws. To Seller's actual knowledge and
except as disclosed in the reports listed on Exhibit
"F", Seller has not received any notice of any
asserted violation of any Environmental Law, or any
notice of any claim pursuant to the provisions of any
Environmental Law, or any notice of any claim for
contribution, trespass, nuisance, or damage or injury
to persons, property or natural resources as a result
of a release or threatened Release of a Hazardous
Substance at, on or from the Property or any notice
of any release of a Hazardous Substance which may
effect the Property;
(b) To Seller's actual knowledge and except as disclosed
in the reports listed on Exhibit "F", there are no
defects or conditions existing at, on or beneath the
Property which could have a material adverse effect
on the Property or, to Seller's knowledge, could
interfere with the Buyer's continued use of the
Property and there are no conditions, at, on, under
or related to, the Property which pose a hazard to
human health or the environment;
(c) Seller has obtained and maintains in full force and
effect, all permits, licenses and other
authorizations required by law or issued pursuant to
any Environmental Law for the operation of the
business of Seller. Seller is in compliance with all
of the terms and conditions of such permits, licenses
and other authorizations, has not received any notice
or other communication concerning any alleged
violation of any such permits, licenses and other
authorizations, and there are no capital expenses or
increases in operating costs anticipated in order for
Seller not to remain in compliance with any
Environmental Law and such permits, licenses and
other authorizations;
(d) There exists no writ, injunction, decree, order or
judgment outstanding, nor any lawsuit, claim,
proceeding, citation, directive, summons or
investigation pending or threatened against Seller
relating to (i) the occupation or use of the
Property; (ii) any alleged violation of any
Environmental Law, or (iii) the suspected presence,
Release or threatened Release of any Hazardous
Substance on, under, in or from the Property, nor, to
the knowledge of Seller, does there exist any valid
basis for any such lawsuit, claim, proceeding,
citation, directive, summons or investigation;
(e) No above, at grade or underground tanks or other
impoundments are now or have ever been located on or
under the Property, except for such tanks which have
been removed in compliance with Environmental Laws as
set forth in Exhibit "F", and except as set forth on
Exhibit "F", no Hazardous Substances are, or to
Seller's actual knowledge ever been stored at or on
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the Property;
(f) All friable asbestos located on the Property has been
properly repaired and sealed to prevent any emission
of asbestos fibers into the ambient air;
(g) There is no PCB containing equipment or material
located on the Property;
(h) Seller has not produced, treated, disposed of or
Released any Hazardous Substance, arranged for the
disposal or Release of any Hazardous Substance or
exposed any employee or other individual to any
Hazardous Substance.
(i) For the purposes of this Agreement:
(i) Environmental Law shall mean all federal, state and
-----------------
local laws, statutes, ordinances, regulations, rules,
judicial and administrative orders and decrees,
permits, licenses, approvals, authorizations and
similar requirements of all federal, state and local
governmental agencies or other governmental
authorities, pertaining to the protection of human
health and safety or the environment.
(ii) Hazardous Substance shall mean any substance which is: 1)
-------------------
defined as a hazardous substance, hazardous material,
hazardous waste, pollutant or contaminant under any
Environmental Law, (2) a petroleum hydrocarbon, including
crude oil or any fraction thereof, (3) hazardous, toxic,
corrosive, flammable, explosive, infectious, radioactive,
carcinogenic, or a reproductive toxicant, or (4) regulated
pursuant to any Environmental Law.
(iii) Release shall mean any spilling, leaking, pumping,
-------
pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping or disposing into the
environment (including the abandonment or discharging of
barrels, containers and other closed receptacles
containing any Hazardous Substance), other than in
compliance with Environmental Law.
(iv) Property shall mean the real property located at 600
Kuebler Road, Easton, PA and all buildings and
improvements thereon.
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22. Environmental Indemnification. The Seller agrees to indemnify and hold
-----------------------------
harmless the Buyer and its directors, officers, employees, affiliates and
assigns from and against any claims, losses, damages, liabilities and
expenses (including reasonable legal expenses) which may be sustained,
suffered or incurred by reason of or arising from:
(a) a material breach of any representation, warranty, covenant or
agreement of Seller contained in this Agreement or any document or
any certificate furnished pursuant to or in connection with this
Agreement, or a claim by an unaffiliated third party that, without
regard to the merits of the claim, would constitute such a breach;
and, or
(i) the presence on, in under or having emanated from the
Property of any Hazardous Substance on or before
Settlement, any release or threatened release of any
Hazardous Substance generated by Seller or any person or
entity for whom Seller has legal liability, first
occurring on, under or from the Property prior to the
Settlement Date, or the use, generation, manufacturing,
production, handling, storage, transport, discharge,
disposal or arrangement for disposal of any Hazardous
Substance on or before Settlement irrespective of whether
any of such activities were undertaken in accordance with
Environmental Law or other applicable laws and
regulations, or
(ii) any offsite disposition of wastes or recyclable materials
generated by Seller prior to Settlement or any violation
of Environmental Law prior to Settlement.
23. Miscellaneous.
-------------
(a) The captions in this Agreement are inserted for convenience of
reference only and in no way define, describe, or limit the scope
or intent of this Agreement or any of the provisions hereof.
(b) Formal tender of an executed deed and purchase money is hereby
waived.
(c) Buyer shall have the right to cause Seller to convey the Property
directly to Buyer's nominee provided that Buyer has fulfilled
Buyer's obligations under this Agreement.
(d) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective heirs,
executor, administrators, legal representatives, successors, and
assigns.
(e) This Agreement, including the exhibits attached hereto, contains
the whole agreement as to the Property between Seller and Buyer,
and there are no other terms, obligations, covenants,
representations, statements, or conditions, oral or otherwise of
any kind whatsoever concerning this sale and purchase. This
Agreement shall not be altered, amended, changed, or
15
modified except in writing executed by the parties hereto.
(f) This Agreement shall be construed in accordance with the laws of
the Commonwealth of Pennsylvania.
(g) Both parties to this Agreement have participated fully and equally
in the negotiation and preparation hereof, this Agreement shall
not be more strictly construed, or any ambiguities within this
Agreement resolved, against either party hereto.
24. Lease Execution. This Agreement is conditioned on the execution of the
Lease Agreement between Buyer as landlord and Seller as tenant attached
hereto and incorporated herein on substantially the terms and conditions
listed in the Letter of Intent, a copy of such provisions attached hereto
as Exhibit "D" on or before the Settlement as defined herein. Settlement
shall not occur until the Lease Agreement is fully executed.
IN WITNESS WHEREOF, intending to be legally bound, the parties have
caused this Agreement to be duly executed, under seal, as of the day and year
first written above.
SELLER:
Paragon Technologies, Inc.
By: /s/ William R. Johnson
----------------------------
Name: William R. Johnson
Title: President & CEO
Witness:/s/ Ronald J. Semanick
----------------------------
BUYER:
J.G. Petrucci Company, Inc.
By: /s/ James G. Petrucci
----------------------------
Name: James G. Petrucci
Title: President
Witness:/s/ Gregory T. Rogerson
----------------------------
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Exhibit A
Legal Description of Property
Copy of Legal Description of Property as prepared by
First American Title Insurance Company
Exhibit B
Insurance Claims
Copy of Police Accident Report and Repair Proposal
pertaining to damaged fire hydrant on
Company property.
Exhibit C
Management Agreements
Except as provided in Schedule C-1, to the best of Seller's knowledge, there are
no existing Management Agreements.
Schedule C-1
------------
Copy of Maintenance Agreement pertaining to
Snow Removal Services
Exhibit D
Lease
To be delivered after the execution of this Agreement incorporating the
terms as set forth in Schedule D-1 attached hereto.
Schedule D-1
Lease-Back: Paragon Technologies, Inc. shall sign a lease for 25,000 s/f of
office space for five (5) years at $8.25 per s/f with three
percent increases per annum (space shall be leased "as-is").
Paragon Technologies, Inc. may break this lease at any time
during the term of this lease to move to any of J.G. Petrucci
Co., Inc.'s existing office buildings or build to suit land
sites.
Paragon Technologies, Inc. reserves the right to investigate
other J.G. Petrucci Co. Inc.'s properties during the Due
Diligence period for the purpose of exploring the
possibility of exchanging Paragon's aforementioned lease
commitment for its Easton, Pennsylvania facility with another
J.G. Petrucci Co. Inc.'s property.
Expenses: Tenant shall pay its pro-rata share of operating expenses on a
monthly basis throughout the term of the Lease.
Security: Tenant will post a letter of credit of $200,000 as security at
the time of final execution of the Lease.
Exhibit E
Zoning Regulations
To be provided by Buyer to Seller after execution of this Agreement but in no
event later than five (5) days after the beginning of the Due Diligence Period.
Exhibit F
Environmental Reports
1. Phase 1 - Environmental Risk Assessment dated September 26, 2002 prepared
by Barry Isett & Associates, Inc.
2. Phase 1 - Environmental Risk Assessment dated August 30, 2001 prepared by
Barry Isett & Associates, Inc.
3. Phase 1 - Environmental Risk Assessment dated August 24, 1999 prepared by
Barry Isett & Associates, Inc.
4. Phase 1 - Product Distribution Equipment Closure Report dated October 21,
1999 prepared by EMS Environmental, Inc.
Exhibit G
Personal Property
To be agreed to by Buyer and Seller after execution of this Agreement but in no
event later than five (5) days prior to Settlement.