EXHIBIT 2.1
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is made as of the 16th day
of June, 2000, by and between STRATUS SERVICES GROUP, INC. a Delaware
corporation (the "Buyer"), and OUTSOURCE INTERNATIONAL OF AMERICA, Inc., a
Florida corporation ("Seller").
PRELIMINARY STATEMENT
WHEREAS, the Buyer desires to purchase, and the Seller desires to sell
substantially all of the assets of the Seller that comprise the ongoing
businesses of the offices of the Seller's "Tandem" division in states of New
Jersey and Pennsylvania, consisting of the offices located in the cities of
Trenton, Lebanon (VOP), Philadelphia, New Brunswick, Perth Amboy, Paterson and
Elizabeth and the Cosmetic Essence, Inc. VOP in Cranbury (collectively, the
"Acquired Business") in exchange for the consideration and the assumption of
certain of the Seller's liabilities as set forth below, subject to the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises hereinafter set
forth and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereby agree as follows:
The recitals set forth above are true and correct and are hereby
incorporated herein by reference.
1. SALE AND DELIVERY OF THE ASSETS
1.1 Delivery of the Assets.
(a) Subject to and upon the terms and conditions of
this Agreement, at the closing of the transactions
contemplated by this Agreement (the "Closing"), the Seller
shall sell, transfer, convey, assign and deliver, and cause
its Affiliates (as defined in Section 2.6) to sell, transfer,
convey, assign and deliver, to the Buyer, and the Buyer shall
purchase from the Seller and such Affiliates, all of the
assets, tangible and intangible, of every kind and nature
owned or used by Seller exclusively in connection with the
operation of the Acquired Business (collectively, the
"Assets"), which Assets include those which are set forth on
Schedule 1.1 attached hereto and the following properties,
assets, rights and interests:
(i) all office supplies and similar
materials of the Seller which exist on the Closing
Date (as defined below) and are used exclusively in
the Acquired Business (other than the letterhead,
marketing materials and other supplies bearing the
name "Tandem", which Buyer may use for a reasonable
transition period, not to exceed sixty (60) days from
the Effective Date, as defined below) (the
"Supplies");
(ii) all rights of the Seller and its
Affiliates under the contracts, agreements, real
estate leases, licenses and other instruments
relating exclusively to the Acquired Business, as set
forth on SCHEDULE 1.1 attached hereto (collectively,
the "Contracts");
(iii) all books and records (limited to the
last three years profit and loss statements and
backup), correspondence, service employee and
customer information in the possession of the Seller,
and reports and summaries relating exclusively to the
Acquired Business or the other assets described
herein (collectively, the "Records");
(iv) all rights of the Seller, if any, under
express or implied warranties from the suppliers of
the Seller in connection with the Acquired Business;
(v) all furniture, fixtures, equipment and
leasehold improvements owned by the Seller on the
Closing Date and relating exclusively to the Acquired
Business, whether or not reflected as capital assets
in the accounting records of the Seller, as set forth
on SCHEDULE 1.1 attached hereto (collectively, the
"Fixed Assets"); and
(vi) all other assets, properties, claims,
rights and interests of the Seller and its Affiliates
existing on the Closing Date, of every kind and
nature and description, whether tangible or
intangible, real, personal or mixed, that are used
solely in connection with the Acquired Business.
(b) Notwithstanding anything to the contrary set
forth in this Agreement, the assets, properties, claims,
rights and interests of the Seller that are not used
exclusively in connection with the Acquired Business will not
be transferred to Buyer hereunder. In addition,
notwithstanding anything to the contrary set forth in this
Agreement, the following items are not included in the sale of
Assets contemplated hereby: (i) the cash and cash equivalents,
accounts receivable, prepaid items (except for health benefits
to the employees of the Acquired Business which shall be
Seller's obligation through June 30, 2000) and deposits, used
in or relating to the Acquired Business, (ii) the Purchase
Price (as hereinafter defined) and the other rights of the
Seller under or relating to this Agreement, (iii) the
corporate minute books, stock records, qualification to
conduct business as a foreign corporation, and other documents
relating to the organization, maintenance or existence as a
corporation of the Seller or any Affiliate of the Seller, (iv)
any proprietary software of Seller or any Affiliate of Seller,
are not to be transferred to Buyer hereunder and are not
included within the definition of the Assets, (v) the names
"Tandem", "Labor World", "Outsource" and all other tradenames,
trademarks and other intellectual property now or hereafter
owned by Seller or any Affiliate, and (vi) any real property
owned by the Seller or any Affiliate of the Seller.
1.2 PURCHASE PRICE. The purchase price for the Assets
shall be One Million Three Hundred Thousand and 00/100 Dollars
($1,300,000.00) (the "Purchase Price") payable as follows:
(i) the Buyer has paid to the Seller and the
Seller hereby acknowledges receipt of a deposit in
the amount of One Hundred Thousand and 00/100 Dollars
($100,000.00);
(ii) the Buyer shall pay to the Seller on
the Closing Date the sum of Seven Hundred Thousand
Dollars and 00/100 ($700,000.00) by wire transfer of
immediately available funds to Seller's designated
account (the "Closing Payment"); and
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(iii) the Buyer shall execute and deliver to
Seller on the Closing Date two (2) promissory notes,
in the form attached hereto as EXHIBIT A-1 (THE
"$400K NOTE") AND EXHIBIT A-2 (the "100K Note"). The
$400K Note shall be in the principal amount of Four
Hundred Thousand and 00/100 Dollars ($400,000.00)
bearing interest at the rate of eight and one half
percent (8 1/2%) per annum, payable $200,000 by
wire transfer on the ninetieth (90th) day
following the Closing Date, and the balance of
$200,000, plus all accrued interest, payable by
wire transfer on the one hundred and eightieth
(180th) day following the Closing Date. The $400K
Note shall be secured by a security interest in
all of the Assets purchased by Buyer hereunder
pursuant to the terms of a security agreement
executed by the parties as of the Closing Date in
substantially the form attached hereto as EXHIBIT
B-1 (the "Security Agreement--All Assets"). The
$100K Note shall be in the principal amount of
One Hundred Thousand and 00/100 Dollars
($100,000.00) bearing interest at the rate of
eight and one half percent (8 1/2%) per annum,
payable in twelve (12) equal monthly installments
of principal and interest commencing on the 1st
day of January, 2001 and continuing on the 1st
day of each month thereafter until December 1st,
2001 when the final installment, plus all accrued
and unpaid interest shall be due and payable. The
$100K Note shall not be secured by the Security
Agreement--All Assets.
1.3 Assumption of Liabilities.
(a) The Buyer agrees to assume, as of the Closing
Date, the liabilities of the Seller arising after the Closing
on the Contracts (the "Assumed Liabilities"). To the extent
that the Assets are leased by Seller or any of its Affiliates
as of the Closing Date, the Buyer will thereafter pay the
rental charge or lease payment for same, or, in the
alternative, reimburse Seller periodically in the event Seller
is required to make such payments directly to the lessor. If
at any time after the Trial Period (as defined below), Seller,
in its sole discretion, chooses to pay off the lease liability
of any Asset in one lump sum, Buyer shall reimburse Seller for
such payment and title to such Asset shall pass to Buyer. At
any time after the Closing, Buyer, upon giving Seller
forty-five (45) days written notice (the "Trial Period"), can
return any item of leased property to Seller in the same
condition as such property was received by Buyer, normal wear
and tear excepted, and upon such return, Buyer shall no longer
have responsibility to reimburse Seller for the lease payment
applicable thereto.
(b) The Buyer shall not assume or agree to perform,
pay or discharge, and the Seller and its Affiliates, as the
case may be, shall remain unconditionally liable for, all
obligations, liabilities and commitments, fixed or contingent,
of the Seller and its Affiliates, other than the Assumed
Liabilities.
1.4 OTHER AGREEMENTS.
(a) As further consideration for the transaction
contemplated hereby, as of the Closing Date, the Seller will
enter into a non-competition agreement with Buyer prohibiting
the Seller from competing, for two (2) years, in the
Pennsylvania counties of Philadelphia and Union, and the New
Jersey counties of Somerset, Middlesex, Passaic, Bergen,
Essex, Hudson, Union, Mercer, Monmouth and Ocean, and
prohibiting Seller from soliciting clients of the Acquired
Business for three (3) years in such counties (the
"Non-Competition Agreement").
(b) In addition to the Assets, the Seller is hereby
granting to the Buyer an option to purchase up to thirteen
(13) Vans owned by Seller and used in the Acquired Business.
The option must be exercised, if at all, no later than the
Effective Date (as defined below) as to all or
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some of the Vans. The price for each Van shall be mutually
agreed upon by the parties but shall, in no event, be less
than the "average" value as contained in the Kelly Blue Book.
The Buyer shall execute and deliver to Seller a promissory
note (the "Van Note") in the form attached hereto as Exhibit
A-3 in the principal amount of the aggregate "average" value
for all Vans purchased by Buyer, bearing interest at the rate
of eight and one half percent (8 1/2%) per annum, payable in
twenty four (24) equal monthly installments of principal and
interest commencing on the 1st day of the second full month
following the Effective Date and on the 1st day of each month
thereafter until the twenty fourth (24th) and final
installment plus all accrued and unpaid interest shall be due
and payable. At the time Buyer executes and delivers the Van
Note, Buyer shall also execute and deliver to Seller a
Security Agreement (EXHIBIT B-2) securing Seller's interest in
the Vans until the Van Note is paid in full, and Seller shall
execute a second Bill of Sale in the same form as EXHIBIT C
but only covering those of the Vans that Buyer exercises its
option to purchase and deliver same to Buyer. Seller shall
also execute and deliver such other transfer documents as will
properly vest title of the Vans in Buyer's name.
1.5 THE CLOSING. Subject to and after fulfillment of
the conditions set forth in Section 4 of this Agreement, the
Closing shall take place at the offices of the Seller in
Delray Beach, Florida, at 9:00 a.m. Eastern Time, on June 19,
2000, or such other time or date or such other location as the
parties may mutually agree (the "Closing" or "Closing Date").
The transfer of the Assets by the Seller to the Buyer shall be
deemed to occur at 12:01 a.m., Eastern Time, on June 26, 2000
(the "Effective Date").
1.6 ALLOCATION OF PURCHASE PRICE. The Purchase Price
shall be allocated among the various Assets by mutual
agreement of the parties.
2. REPRESENTATIONS OF THE SELLER. The Seller represents and
warrants to the Buyer as follows:
2.1 ORGANIZATION. The Seller is a corporation duly
organized, validly existing and in good standing under the
laws of the State of Florida and is duly qualified to do
business in, and is in good standing under, the laws of the
States of Florida, Pennsylvania and New Jersey. The Seller has
all requisite power and authority (corporate and other) to
execute and deliver this Agreement and the documents,
instruments and agreements contemplated herein, and to
consummate the transactions contemplated hereby and thereby.
2.2 AUTHORIZATION. The execution and delivery of this
Agreement, and the agreements provided for herein by the
Seller, and the consummation by the Seller of all transactions
contemplated hereby and thereby, have been duly authorized by
all requisite corporate action. This Agreement and all such
other agreements and obligations entered into and undertaken
in connection with the transactions contemplated hereby to
which the Seller is a party constitute the valid and legally
binding obligations of the Seller, enforceable against the
Seller in accordance with their respective terms, except as
the same may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and general
equitable principles, regardless of whether such
enforceability is considered in a proceeding at law or in
equity. The execution, delivery and performance of this
Agreement and the agreements provided for herein, and the
consummation by the Seller of the transactions contemplated
hereby and thereby, will not, with or without the giving of
notice or the passage of time or both, (a) violate the
provisions of any law, rule or regulation applicable to the
Seller; (b) violate the provisions of the Seller's Articles of
Incorporation or Bylaws; or (c) violate any judgment, decree,
order or award of any court, governmental body or arbitrator.
2.3 OWNERSHIP OF THE ASSETS; NO OTHER OBLIGATION TO
TRANSFER. Except where any property subject to this sale is
leased, and subject to a general lien on Seller's assets in
favor of
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Outsource International, Inc.'s senior lenders, the Seller has
good and marketable title to all of the Assets, free and clear
of all liens, claims, encumbrances and restrictions
whatsoever. The consent and release of liens of Outsource
International, Inc.'s senior lenders is required to enable
Seller to sell, transfer and assign the Assets to Buyer as
contemplated by this Agreement.
2.4 LITIGATION. There are no judgments, suits,
actions, investigations or proceedings pending or, to the
Seller's knowledge, threatened against the Seller that relate
to or affect the Assets or the Acquired Business by any court,
administrative agency or other governmental authority.
2.5 REAL PROPERTY; LEASES. Seller does not own any
real estate used in connection with the Acquired Business.
SCHEDULE 2.5 attached hereto sets forth a true, correct and
complete list as of the date hereof of all leases of real
property to which the Seller is a party in connection with the
Acquired Business (collectively, the "Leases"). True, correct
and complete copies of the Leases, and all amendments and
modifications thereof, have previously been delivered by the
Seller to the Buyer. The Leases are in full force and effect
and have not been modified or amended since the date of
delivery to the Buyer. No party to any Lease has sent written
notice to the other claiming that such other party is in
default thereunder, which alleged default remains uncured.
2.6 COMPLIANCE WITH AGREEMENTS AND LAWS. The Seller
has all requisite licenses, permits and certificates from
federal, state and local authorities necessary to conduct the
Acquired Business and own and operate the Assets
(collectively, the "Permits").
3. REPRESENTATIONS OF THE BUYER. The Buyer represents and
warrants to the Seller as follows:
3.1 ORGANIZATION AND AUTHORITY. The Buyer is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has
requisite power and authority (corporate and other) to own its
properties and to carry on its business as now being
conducted. The Buyer has full power to execute and deliver
this Agreement and all other documents, instruments and
agreements to be delivered by it hereunder and to consummate
the transactions contemplated hereby and thereby.
3.2 AUTHORIZATION. The execution and delivery of this
Agreement by the Buyer, and the agreements provided for
herein, and the consummation by the Buyer of all transactions
contemplated hereby, have been duly authorized by all
requisite corporate action. This Agreement and all such other
agreements and written obligations entered into and undertaken
in connection with the transactions contemplated hereby
constitute the valid and legally binding obligations of the
Buyer, enforceable against it in accordance with their
respective terms. The execution, delivery and performance of
this Agreement and the agreements provided for herein, and the
consummation by the Buyer of the transactions contemplated
hereby and thereby, will not, with or without the giving of
notice or the passage of time or both, (a) violate the
provisions of any law, rule or regulation applicable to the
Buyer; (b) violate the provisions of the Buyer's Articles of
Incorporation or Bylaws; (c) violate any judgment, decree,
order or award of any court, governmental body or arbitrator;
or (d) conflict with or result in the breach or termination of
any term or provision of, or constitute a default under, or
cause any acceleration under, or cause the creation of any
lien, charge or encumbrance upon the properties or assets of
the Buyer pursuant to, any indenture, mortgage, deed of trust
or other agreement or instrument to which it or its properties
is a party or by which the Buyer is or may be bound.
3.3 CONSENTS. No consent, approval, authorization or
other action by, or filing with, any governmental authority or
any other third party is required in connection with the
execution,
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delivery and performance by the Buyer of its obligations under
this Agreement and the consummation by the Buyer of the
transactions contemplated hereby.
4. CLOSING DELIVERIES
4.1 BY SELLER. The Seller shall deliver to the Buyer
at the Closing each of the following documents:
(a) a Bill of Sale in the form attached
hereto as EXHIBIT C, duly executed by Seller and the
appropriate Affiliates of Seller;
(b) an Assignment and Assumption of
Contracts and Liabilities executed by the Seller
evidencing the Seller's assignment and the Buyer's
assumption of the Assumed Liabilities contemplated by
Section 1.3 hereof in the form attached hereto as
EXHIBIT D (the "Assignment and Assumption
Agreement");
(c) the Non-Competition Agreement in the
form attached hereto as EXHIBIT E;
(d) the Records;
(e) copies of the general ledgers and books
of account of the Seller pertaining to the Assets or
the Acquired Business for the past three years and
audited annual and unaudited interim "Statements of
Net Assets Acquired and Liabilities Assumed" and
"Statements of Division Results of Operations" in
satisfaction of Rule 310 (c) of Regulation S-B and
for the required periods of Form 8-K, pursuant to the
June 1, 2000 "no-action" letter from the Securities
and Exchange Commission (attached hereto as EXHIBIT
H), it being understood and agreed by the Buyer that
any cost and expense charged by Seller's auditors to
produce such Statements in excess of the first Ten
Thousand and 00/100 Dollars ($10,000.00), which shall
be the responsibility of Seller, shall be paid by
Buyer to Seller's auditors.
(f) consents, in the form of EXHIBIT F
attached hereto from each lessor relating to all
Leases identified on SCHEDULE 2.5 attached hereto,
consenting to the assumption of each such Lease by
the Buyer;
(g) cross receipt executed by the Seller, in
the form of EXHIBIT G ("Cross Receipt");
(h) a certificate executed by an officer of
the Seller that all representations and warranties
made herein by the Seller are true and correct at the
time of Closing;
(i) a certificate from the secretary of the
Seller attesting to the accuracy of resolutions to be
attached thereto approved by the Board of Directors
of the Seller authorizing the sale of the Assets and
providing incumbency information for the individual
signing this Agreement on behalf of the Seller; and
(j) a copy of (i) the consent of the Fleet
National Bank (the "Lender") to the sale, transfer
and assignment of the Assets to the Buyer as
contemplated by this Agreement, and (ii) the release
of the Lender as evidenced by UCC-3 Termination
Statements, pursuant to which the Lender releases or
terminates its security interest in the Assets.
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4.2 BY THE BUYER. The Buyer shall deliver to the
Seller at the Closing each of the following documents:
(a) the Assignment and Assumption Agreement
(EXHIBIT D), executed by Buyer;
(b) payment of the Closing Payment;
(c) the $400K Note (EXHIBIT A-1), executed
by the Buyer;
(d) the $100K Note (EXHIBIT A-2), executed
by the Buyer;
(e) the Security Agreement-All Assets
(EXHIBIT B-1), executed by the Buyer;
(f) a UCC-1 financing statement, executed by
the Buyer;
(g) the Cross Receipt, executed by the
Buyer;
(h) a certificate executed by an officer of
the Buyer that all representations and warranties
made herein are true and correct at the time of
Closing; and
(i) a certificate of the secretary of the
Buyer attesting to the accuracy of the resolutions of
the Board of Directors of the Buyer authorizing the
purchase of the Assets and providing incumbency
information for the individual signing this Agreement
on behalf of the Buyer.
5. INDEMNIFICATION
5.1 BY THE SELLER. The Seller shall indemnify and
hold the Buyer harmless from any and all actions, claims,
liabilities, damages, costs or expenses (including, without
limitation, reasonable attorney's fees and expenses) that the
Buyer may incur, or to which it may become subject, from third
party claims arising from or relating to the operation of the
Acquired Business prior to the Effective Date.
5.2 BY THE BUYER. The Buyer shall indemnify and hold
the Seller harmless from any and all actions, claims,
liabilities, damages, costs or expenses (including, without
limitation, reasonable attorney's fees and expenses) that the
Seller may incur, or to which it may become subject, from
third party claims arising from or relating to the operation
of the Acquired Business from and after the Effective Date.
5.3 SURVIVAL OF REPRESENTATIONS. All representations
and warranties made by the parties herein or in any instrument
or document furnished in connection herewith shall survive for
a period of six (6) months following the Closing and any
investigation at any time made by or on behalf of the parties
hereto.
5.4 REDUCTION FOR INSURANCE PROCEEDS. To the extent
that any Indemnified Party shall receive payment under any
insurance policies on account of Claims arising under Section
5.1 or Section 5.2 hereof, the amount (if any) payable by the
Indemnifying Party on account of such Claims shall be reduced
by the amount of such payment or, if the Indemnified Party
shall have already collected on such Claims from the
Indemnifying Party, then the Indemnified Party shall repay to
the Indemnifying Party the amount of such payment.
6. PRE-CLOSING AGREEMENTS
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6.1 CORE EMPLOYEES. While the Buyer understands that
the Seller cannot guarantee that any employees will enter into
employment, non-competition and non-solicitation agreements
with the Buyer, Seller will make a good faith effort in
encouraging the core staff employees to enter into such
agreements with Buyer.
6.2 CONDUCT OF BUSINESS. Between the date of this
Agreement and the Effective Date, the Seller shall carry on
the Acquired Business substantially in the same manner as
heretofore and shall not make or institute any unusual or new
methods of purchase, sale, performance, lease, management,
accounting or operation. Between the date of this Agreement
and the Effective Date, all of the Assets shall be used,
operated, repaired and maintained by the Seller in a normal
business manner consistent with past practice. Unless
instructed otherwise by the Buyer in writing, the Seller will
accept customer requests for services in the ordinary course
of business and consistent with past practice for all services
offered by the Seller but expected to be performed by the
Buyer after the Effective Date. The Seller and the Buyer will
cooperate in communications with suppliers and customers to
accomplish the transfer of the Assets to the Buyer on the
Effective Date. The Seller will comply with all laws and
regulations which are applicable to its ownership of the
Assets or to the conduct of the Acquired Business and will
perform and comply with all contracts, commitments and
obligations by which it is bound. Seller agrees to notify and
consult with Buyer with respect to all decisions outside of
the ordinary course relating to the Acquired Business and to
notify Buyer of any employee departures or any pending
employee departures.
6.3 ACCESS TO MANAGEMENT, PROPERTIES AND RECORDS.
From the date of this Agreement until the Effective Date, the
Seller shall afford the officers, attorneys, accountants and
other authorized representatives of the Buyer reasonable
access upon reasonable notice and during normal business hours
to all management personnel, and books and records of the
Seller relating solely to the Acquired Business. The Buyer
shall be permitted to make abstracts from, or copies of, all
such books and records. The Seller shall furnish to the Buyer
such financial and operating data and other information as to
the Assets and the Acquired Business as the Buyer shall
reasonably request and cause its management personnel to
cooperate with the Buyer and to be available at the reasonable
request of the Buyer so as to provide the Buyer's agents with
any and all information concerning the Assets and the Acquired
Business that may reasonably be required to close the
transactions contemplated hereby. Notwithstanding anything
contained in this Section 6.3 above, the Buyer's right to
continue its due diligence procedures shall in no way be
construed to imply that completion of such due diligence, or
the ability of the Buyer to obtain financing, is or will be a
condition to closing this transaction. Furthermore, to the
extent Buyer requires Seller to engage Seller's outside
auditors to perform any work in connection with any requests
under this Section 6.3, Buyer shall pay the full cost of such
engagement.
6.4 AGENTS OF AFFILIATES OF SELLER. Seller shall use
its best efforts to cause its Affiliates to execute and
deliver at Closing the Bill of Sale referred to in Section
4.1(a) of this Agreement and the Assignment and Assumption
Agreement referred to in Section 4.1(j) of this Agreement and
any other documents required to be delivered by such
Affiliates in furtherance of evidencing the transfer of the
Assets to the Buyer.
7. POST-CLOSING AGREEMENTS. The Seller and the Buyer, as the case may
be, agree that from and after the Closing Date:
7.1 PROPRIETARY INFORMATION.
(a) The Seller shall hold in confidence, and use its
best efforts to have all of its officers, directors and
personnel hold in confidence, all knowledge and information of
a
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secret or confidential nature with respect to the Acquired
Business and shall not disclose, publish or make use of the
same without the consent of the Buyer, except (i) to the
extent that such information shall have become public
knowledge other than by breach of this Agreement by the
Seller, (ii) as may be required to enforce any of Seller's
rights against Buyer, or (iii) as may be required by law or
legal process.
(b) The Seller agrees that the remedy at law for any
breach of this Section 7.1 may be inadequate and that the
Buyer shall be entitled to seek injunctive relief in addition
to any other remedy it may have upon breach of any provision
of this Section 7.1.
7.2 FURTHER ASSURANCES AND DATA.
(a) At any time and from time to time after the
Effective Date, at the Buyer's reasonable request and without
further consideration, the Seller shall execute and deliver,
and cause its Affiliates to execute and deliver, such
instruments of sale, transfer, conveyance, assignment and
confirmation, and take such other action, all at the Seller's
sole cost and expense, as the Buyer may reasonably request to
more effectively transfer, convey and assign to the Buyer, and
to confirm the Buyer's title to, all of the Assets, to put the
Buyer in actual possession and operating control thereof, to
assist the Buyer in exercising all rights with respect
thereto, and to carry out the purpose and intent of this
Agreement. Immediately after the Closing, the Seller shall, to
the extent applicable, authorize the release, and cause its
Affiliates to authorize the release, to the Buyer of all files
pertaining to the Assets or the Acquired Business held by any
federal, state, county or local authorities, agencies or
instrumentalities.
(b) The parties agree that from and after the
Effective Date, as to any monies received that rightfully
belong to the other party, they shall remit such monies
promptly to the other party.
(c) Within fifteen (15) business days after the
Closing Date, the parties shall mutually agree on the
pro-ration as of the Effective Date of rent, utilities and
telephone for the Acquired Business, and the party obligated
to pay the net amount of such pro-rated items to the other
party will make such payment ten (10) days after the agreement
on pro-rations is consummated. Seller will pay the premiums
for health benefits of the employees of the Acquired Business
through June 30, 2000.
(d) The Buyer shall have the right, for a period of
three (3) years following the Closing Date, to have reasonable
access to those books, records and accounts, including
financial and tax information, correspondence, employment
records and other records that may, at that time, be retained
by the Seller to the extent that any of the foregoing relates
to the Acquired Business and is needed by the Buyer in order
to comply with its obligations under applicable securities,
tax, environmental, employment or other laws and regulations.
7.3 COOPERATION IN LITIGATION. Each party hereto will
reasonably cooperate with the other in the defense or prosecution of
any litigation or proceeding already instituted or which may be
instituted hereafter against or by such party relating to or arising
out of the conduct of the Acquired Business prior to the Closing Date
(other than litigation arising out of the transactions contemplated by
this Agreement). The party requesting such cooperation shall pay the
out-of-pocket expenses (including legal fees and disbursements) of the
party providing such cooperation and of its officers, directors,
employees and agents reasonably incurred in connection with providing
such cooperation, but shall not be responsible to reimburse the party
providing such
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cooperation for such party's time spent in such cooperation or the
salaries or costs of fringe benefits or similar expenses paid by the
party providing such cooperation to its officers, directors, employees
and agents while assisting in the defense or prosecution of any such
litigation or proceeding.
8. TRANSFER AND SALES TAX. Notwithstanding any provisions of
law imposing the burden of such taxes on the Seller or the Buyer, as
the case may be, the Seller shall be responsible for and shall pay (a)
all sales, use and transfer taxes, and (b) all governmental charges, if
any, upon and due in connection with the sale or transfer of any of the
Assets hereunder. If the Seller shall fail to pay such amounts on a
timely basis, the Buyer may pay such amounts to the appropriate
governmental authority or authorities, and the Seller shall promptly
reimburse the Buyer for any amounts so paid by the Buyer.
9. BROKERS
9.1 FOR THE BUYER. The Buyer agrees to pay all fees,
expenses and other compensation owed by it to Equitable
Business & Financial Services ("Equitable"). The Buyer agrees
to indemnify and hold harmless the Seller against any claims
or liabilities asserted against it by Equitable or by any
other person acting or claiming to act as a broker or finder
on behalf of the Buyer.
9.2 FOR THE SELLER. The Seller represents and
warrants that the Seller has not engaged any broker or finder
or incurred any liability for brokerage fees, commissions or
finder's fees in connection with the transactions contemplated
by this Agreement. The Seller agrees to indemnify and hold
harmless the Buyer against any claims or liabilities asserted
against it by any person acting or claiming to act as a broker
or finder on behalf of the Seller.
10. NOTICES. Any notices or other communications required or
permitted hereunder shall be in writing and shall be sufficiently given
if delivered personally or sent by facsimile (with transmission
confirmed), federal express, registered or certified mail, return
receipt requested, postage prepaid, addressed as follows or to such
other address or facsimile number of which the parties may have given
notice:
To the Seller: With a copy to:
Mr. Scott R. Francis Joseph C. Wasch, Esq.
Vice President General Counsel
Outsource International of Outsource International, Inc.
America, Inc. 1690 South Congress Avenue, Suite 210
1690 South Congress Avenue Delray Beach, FL 33445
Delray Beach, FL 33445
To the Buyer: With a copy to:
Mr. Joseph J. Raymond J. Todd Raymond, Esq.
President & CEO General Counsel
Stratus Services Group, Inc. Stratus Services Group, Inc.
500 Craig Road, Suite 201 500 Craig Road, Suite 201
Manalapan, NJ 07726 Manalapan, NJ 07726
Unless otherwise specified herein, such notices or other communications
shall be deemed received (a) on the date delivered, if delivered
personally, by facsimile or by federal express; or (b) three business
days after being sent, if sent by registered or certified mail.
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11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective heirs, successors and assigns, except that neither party may
assign its obligations hereunder without the prior written consent of
the other parties hereto; PROVIDED, HOWEVER, that the Buyer may assign
Buyer's rights hereunder to a subsidiary or affiliate of Buyer,
PROVIDED that the Buyer shall remain liable for its obligations
hereunder. Any assignment in contravention of this provision shall be
void. No assignment shall release the Buyer from any obligation or
liability under this Agreement.
12. ENTIRE AGREEMENT; AMENDMENTS; ATTACHMENTS
12.1 ENTIRE AGREEMENT; AMENDMENT. This Agreement, all
Schedules and Exhibits hereto, and all agreements and
instruments to be delivered by the parties pursuant hereto
represent the entire understanding and agreement between the
parties hereto with respect to the subject matter hereof and
supersede all prior oral and written and all contemporaneous
oral negotiations, commitments and understandings between such
parties. The Buyer and the Seller, by the consent of their
respective Boards of Directors or officers authorized by such
Boards, may amend or modify this Agreement, in such manner as
may be agreed upon, by a written instrument executed by the
Buyer and the Seller.
12.2 ATTACHMENTS. If the provisions of any Schedule
or Exhibit to this Agreement are inconsistent with the
provisions of this Agreement, the provisions of this Agreement
shall prevail. The Exhibits and Schedules attached hereto or
to be attached hereafter are hereby incorporated as integral
parts of this Agreement.
13. EXPENSES. Except as otherwise expressly provided herein,
each party hereto shall pay its own expenses in connection with this
Agreement and the transactions contemplated hereby.
14. LEGAL FEES. In the event that legal proceedings are
commenced by any party hereto against any other party hereto in
connection with this Agreement or the transactions contemplated hereby,
the party which does not prevail in such proceedings shall pay the
reasonable attorneys' fees and costs incurred by the prevailing party
in such proceedings.
15. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New Jersey,
without regard to conflicts of law principles. The parties hereto agree
to be subject to the exclusive jurisdiction and venue shall reside in
the state and federal courts located in Monmouth County, New Jersey for
the purpose of adjudicating any dispute relating to or arising out of
this Agreement.
16. SECTION HEADINGS. The section headings are for the
convenience of the parties and in no way alter, modify, amend, limit,
or restrict the contractual obligations of the parties.
17. SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement.
18. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but
all of which, when taken together, shall be one and the same document.
19. SURVIVAL. The terms and provisions of Section 5 through
(and including) this Section 19 shall survive the Closing of the
transactions contemplated hereby.
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20. PUBLIC DISCLOSURE. Neither party shall make any public
statement about, nor issue any press release concerning this Agreement
or the transaction contemplated hereby without first consulting with
the other party hereto as to the form and substance of any such press
release or public disclosure; provided, however, that nothing in this
Section 20 shall be deemed to prohibit any party hereto from making any
disclosure that its counsel deems necessary or advisable in order to
satisfy such party's disclosure obligation imposed by law.
21. TERMINATION. This Agreement may be terminated at any time
prior to or on the Closing Date:
(a) by mutual written consent of the Buyer and the
Seller; or
(b) by the Buyer if the Seller fails to deliver by
the Closing Date all of the documents the Seller is required
to deliver under Section 4.1 of this Agreement or if the
Seller breaches the provisions of Section 6.2 or 6.3 of this
Agreement; or
(c) by the Seller if the Buyer fails to deliver by
the Closing all of the documents the Buyer is required to
deliver under Section 4.2 of this Agreement; or
(d) by any party in the event that the Closing shall
not have occurred on or prior to July 3, 2000; PROVIDED,
HOWEVER, that the failure of the Closing to occur by such date
shall not have been the result of the failure of the party
seeking to terminate this Agreement to deliver by the Closing
Date all such documents as are required under the relevant
subsection of Section 4.
IN WITNESS WHEREOF, this Agreement has been duly executed by
the parties hereto as of the date first above written.
OUTSOURCE INTERNATIONAL OF AMERICA, INC.
By: /s/ Garry E. Meier
------------------------------
Print Name: Garry E. Meier
-----------------------
Title: President and CEO
---------------------------
STRATUS SERVICES GROUP, INC.
By: /s/ Joseph J. Raymond
------------------------------
Print Name: Joseph J. Raymond
-----------------------
Title: President and CEO
---------------------------
NOTE: EXHIBITS TO THIS ASSET PURCHASE AGREEMENT HAVE BEEN OMITTED AND WILL BE
SUBMITTED TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST.
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