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Stock Purchase and Sale Agreement between Workforce Systems Corp., a
Florida corporation, and Darren Apel, Barbara Hausman and Ronna Newman
Rutstein, as shareholders of LPS Acquisition Corp.
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STOCK PURCHASE AND SALE AGREEMENT
THIS AGREEMENT made and entered into this 22nd day of September, 1997,
between DARREN APEL, BARBARA HAUSMAN and RONNA NEWMAN RUTSTEIN, hereinafter
referred to as "Sellers", and WORKFORCE SYSTEMS CORP., hereinafter referred to
as "Purchaser".
W I T N E S S E T H:
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WHEREAS, Sellers owns all of the authorized, issued and outstanding shares
of LPS ACQUISITION CORP., a Florida corporation doing business as "Lantana Peat
& Soil" ("LPS") at 10570 Hagen Ranch Road, Boynton Beach, Florida 33437 as
follows:
DARREN APEL 852 SHARES
BARBARA HAUSMAN 74 SHARES
RONNA NEWMAN RUTSTEIN 74 SHARES
WHEREAS, LPS is engaged in the production and sale of custom-blended soil
mixes primarily in the State of Florida;
WHEREAS, Purchaser is a publicly traded Florida Corporation engaged in a
variety of businesses unrelated to the business of LPS;
WHEREAS, Sellers desires to sell to Purchaser, and Purchaser desires to
purchase from Sellers One Thousand (1,000) shares of the stock of LPS, which
shares represent One Hundred (100%) percent of the outstanding and issued
authorized shares of LPS, in a stock-for-stock exchange at the rate of 270
shares of Purchaser's shares for each share of LPS stock owned by Sellers, on
the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual and
dependent promises hereinafter set forth, the parties hereto agree as follows:
1. EXCHANGE OF SHARES AT CLOSING .
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1.1 At Closing, Sellers shall deliver to Purchaser a certificate(s)
representing One Thousand (1,000) shares of common stock of LPS representing One
Hundred (100%) percent of the then outstanding and issued authorized shares of
LPS (the "Stock"). The certificates shall be duly endorsed for transfer in favor
of Purchaser, or accompanied by properly executed stock powers, with signatures
guaranteed.
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1.2 In consideration for the sale and transfer of Stock, Purchaser shall
deliver to Sellers at Closing an aggregate number of Two Hundred and Seventy
Thousand (270,000) Shares of Common Stock of the Purchaser (the "Issued
Shares"). The certificates shall be duly endorsed for transfer in favor of
Sellers, or accompanied by properly executed stock powers, with signatures
guaranteed.
1.3 The Issued Shares have not been registered under the Securities Act
of 1933 (the "Act") or any other applicable federal or state statute and they
cannot be transferred, sold or otherwise disposed of unless registered under the
Act or pursuant to an exemption therefrom. Therefore, the following legend will
be placed on the certificate evidencing the Issued Shares:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"). THE
SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF A CURRENT AND EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT WITH RESPECT TO SUCH SHARES, OR AN OPINION OF THE
REGISTERED HOLDER'S COUNSEL REASONABLY ACCEPTABLE TO ISSUER'S
COUNSEL TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER
THE ACT.
Sellers are aware of the provisions of Rule 144 under the Act, as such
rule is presently written.
2. CLOSING.
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2.1 The Closing shall take place on or about September 22, 1997 (the
"Closing"), at the offices of Sellers. In addition to the deliveries to be made
at the Closing as provided for in Paragraph 1 above, there shall also be
delivered as a condition precedent to closing the following:
a. LPS's most recent unaudited financial statement as of August
31, 1997;
b. duly executed Corporate Resolution and Certificates of Good
Standing as of the Closing date evidencing that the Purchaser has the power and
authority to complete this Agreement as contemplated herein;
c. the resignations of all officers and directors of LPS; and
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d. an opinion of Sellers' counsel reasonably required by
Purchaser which gives legal effect to the transaction contemplated by this
Agreement;
e. any and all documents reasonably required by the Parties to
give legal effect to the transaction contemplated by this Agreement as a
tax-free (stock-for-stock) exchange under the applicable provisions of the
Internal Revenue Code. Otherwise, Sellers may terminate this Agreement; and
f. Purchaser's receipt of a fairness opinion in support of the
stock-for-stock exchange contemplated by this Agreement within 30 days from the
Closing. In the event the fairness opinion does not support the stock-for-stock
exchange ratio of 270 to 1, the exchange ratio shall be adjusted by mutual
agreement of the Sellers and Purchaser.
3. SELLERS' REPRESENTATIONS AND WARRANTIES.
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3.1 Except as and to the extent reflected on Exhibit "A", or as herein
set forth below, Sellers represent and warrant to Purchaser that as of the date
of this Agreement LPS had no other known material liabilities or obligations
secured or unsecured (whether accrued, absolute, contingent or otherwise) and
that:
a. LPS has paid any and all taxes, license fees, or other charges
levied, assessed or imposed, upon the business and any property of LPS, except
those which are not yet due and payable. All taxes required to be made to
government agencies by LPS with respect to its operations prior to the Closing
will be the sole responsibility of LPS and paid as they become due.
b. LPS has duly prepared and filed all tax returns and reports
required by all Federal, State and local tax authorities, that the returns so
filed are true and correct, and that all such taxes, including sales, corporate,
property, excise and use taxes, if any, have been paid.
c. LPS is not presently involved in any active or outstanding
disputes with any taxing authority, with possible exception of a dispute
concerning payment of delinquent Palm Beach County tangible personal property
taxes, the outcome of which will not result in a liability to LPS in excess of
$20,000.
3.2 Sellers represent and warrant that all of the leasehold
improvements, machinery and equipment now owned or used by LPS, is in good
working condition and will be in the same physical condition as of the Closing
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date, ordinary wear and tear excepted, and their use in the business of LPS is
in compliance with applicable laws and governmental regulations.
3.3 Sellers represent and warrant LPS's books of account reflect
substantially all of its items of income and expense, and all of its assets and
liabilities. In addition, LPS has filed all reports and returns required by any
law or regulation to be filed, and is in good standing on all of its operating
and capital leases.
3.4 Sellers represent and warrant LPS has good and marketable title to
all of its property free and clear of all mortgages, pledges, liens, charges,
and other encumbrances except those set forth in Exhibit "A" which are in good
standing as of the Closing date.
3.5 Sellers represent and warrant there is no litigation, proceeding or
governmental investigation pending or threatened against, or relating to LPS or
its properties or business.
3.6 Sellers represent and warrant they have the legal power and right to
enter into and perform this Agreement and the consummation of the transaction
contemplated by this Agreement will not result in a breach or a termination of
any terms or provisions of, nor constitute a default under, any contract,
mortgage or other instruments to which Sellers or LPS are a party or by which
they are bound.
3.7 Except as specifically set forth above, Sellers have not made any
representation(s), or given any warranty(ies), expressed or implied, oral or
written, with respect to the financial or economic performance of the business
of LPS, of the usability, condition or fitness of the assets of LPS, or of the
quality, marketability or fitness of the product inventories (for resale) of
LPS. By its execution of this Agreement, Purchaser acknowledges and agrees that
it has not relied upon any representation or warranty, other than set forth
above, and that Sellers has not made any other representation(s), or given any
other warranty(ies), express or implied, oral or written, with respect to the
financial or economic performance of the business of LPS, of the usability,
condition or fitness of the assets of LPS, or of the quality, merchantability or
fitness of the product inventories (for resale) of LPS.
3.8 Purchaser is familiar with the business operations of LPS and has
had an opportunity to review its books and records prior to execution of this
Agreement. Purchaser is further aware that:
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(i) LPS acquired on August 11, 1997 (the "Acquisition Date")
substantially all of its existing operating assets, accounts receivable,
furniture and equipment and general intangibles, including the trade name
"Lantana Peat & Soil", from KEDAC, INC., a Florida corporation which is
presently a debtor under Chapter XI of the U.S. Bankruptcy Code (Case No.
97-30009 BKC-SHF, Southern District of Florida), pursuant to the terms of that
certain Agreement for Sale of Business Assets dated June 16, 1997, a copy of
which is attached hereto as Exhibit "B";
(ii) pursuant to the terms of the Agreement for Sale of Business Assets,
LPS has entered into a long-term employment agreement with a key employee, Eric
W. Deckinger, a copy of which is attached hereto as Exhibit "C" (the "Employment
Agreement");
(iii) since the Acquisition Date, LPS experienced a theft of two (2)
trucks which requires replacement in order to operate the business of LPS;
(iv) pursuant to the terms of the Agreement for Sale of Business Assets,
LPS is required to assume two (2) banks loans totaling $750,000 which are
personally guaranteed and collateralized by Eric W. Deckinger and Adrienne
Deckinger, his wife, and which are also collateralized by the assets of LPS;
(v) LPS cannot operate its business on the land it presently leases from
the Deckinger Family Trust No. 2 because it does not have special exception
zoning. Consequently, LPS is required to relocate its operations to another
qualified location by December 31, 1997; and
(vi) LPS has not yet reached an agreement with Associate Commercial
concerning the continued use and lease of certain leased equipment critical to
the continued operation of the business of LPS.
4. INDEMNIFICATION
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Sellers shall indemnify and hold Purchaser harmless from any material
misrepresentation arising under Paragraph 3 above (to the extent known by
Sellers as of the Closing date) including but not limited to all debts,
liabilities and obligations, taxes and/or claims imposed by creditors or taxing
authorities against LPS arising or existing by reason of LPS's business
operations, or otherwise, prior to its sale of Stock to Purchaser hereunder.
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5. SELLERS' CONDUCT PENDING CLOSING
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5.1 All of LPS's assets will be adequately insured against fire and
casualty to the Closing date, and valid policies are in effect and will be
outstanding and fully in force and the premiums due thereon to the date of
Closing will have been paid.
5.2 Sellers have not and will not enter into any agreement to sell,
mortgage, pledge or transfer any parts of LPS, and that there are no claims by
any third- parties arising out of such agreement.
5.3 Sellers will operate the business in its ordinary manner between the
date of this Agreement and the date of Closing.
5.4 Sellers shall provide Purchaser with access to LPS's books and
records at such reasonable times as Purchaser deems appropriate in order to
allow Purchaser to evaluate the Sellers' representations and warranties as set
forth in Paragraph 3 above and to monitor Sellers' conduct under this Paragraph
pending Closing.
6. CONDITIONS PRECEDENT OF PURCHASER'S OBLIGATIONS.
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6.1 The representations and warranties of Sellers contained in this
Agreement are true and correct in all material respects, and shall be deemed to
have been made again, as of the time of Closing.
6.2 Prior to or at Closing, Sellers shall perform and comply with all
agreements and conditions required by this Agreement, including but not limited
to those set forth in Paragraph 5 above.
6.3 Prior to or at Closing, Sellers shall deliver to Purchaser in
satisfactory form all of the documents required under this Agreement.
6.4 The failure of any one of the foregoing shall entitle Purchaser to
declare this Agreement null and void in which event Sellers and Purchaser shall
have no further obligation under this Agreement.
7. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
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The representations, warranties, covenants and indemnifications of the
Sellers and Purchaser provided for herein shall survive the Closing.
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8. WAIVER.
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Each party may, at its option, waive in writing any and all obligations to
be performed by the other party and any and all of the conditions herein
contained to which its obligations hereunder are subject.
9. REPRESENTATION BY COUNSEL.
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Each party has been represented by counsel and shall pay its own
attorney's fees in connection with this transaction.
10. NOTICES.
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Any and all notices required to be given pursuant to this Agreement shall
be deemed given if sent by United States Certified Mail, First Class, postage
prepaid, return receipt requested, correctly addressed to the party for whom it
is intended as follows:
FOR SELLERS: 7777 West Glades Road
Suite 213
Boca Raton, FL 33434
FOR PURCHASER: 7777 West Glades Road
Suite 211
Boca Raton, FL 33434
WITH COPY TO: ROBERT I. CLAIRE, ESQUIRE
Selman & Claire
7280 W. Palmetto Park Road
Suite 106
Boca Raton, Florida 33433
Attorney for Sellers
WITH COPY TO: JOEL D. MAYERSOHN, ESQUIRE
Atlas, Pearlman, Trop & Borkson, P.A.
200 E. Las Olas Blvd.
Suite 1900
Ft. Lauderdale, FL 33301
Attorney for Purchaser
11. INVALIDITY.
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If any part or parts of this Agreement shall, for any reason whatsoever,
be declared invalid and ineffectual by any court of competent jurisdiction, the
other
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parts thereof shall nonetheless remain valid and effectual and continue in full
force and effect to the extent that such excision of the invalid portions is
possible without doing violence to the paramount intention of the parties hereto
as set forth. If it shall appear impossible or impractical to continue this
Agreement in force after such excision, then and in that event, the parties
hereto do hereby each undertake and agree that they will, upon demand of any of
the other parties, make, execute, acknowledge and deliver any and all
instruments which may be lawfully competent to accomplish the purposes hereof.
12. ENTIRE AGREEMENT.
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This Agreement contains the entire agreement between the parties, and any
executory agreement hereafter made shall be ineffective to change, modify, or
discharge, in whole or in part, this Agreement, unless such executory agreement
is in writing and is signed by the parties against when enforcement of the
change, modification or discharge is sought.
IN WITNESS WHEREOF, the parties have executed this Agreement the date
first above written.
WITNESSES: SELLERS:
/s/ Darren Apel
DARREN APEL
/s/ Barbara Hausman
BARBARA HAUSMAN
/s/ Ronna Newman Rutstein
RONNA NEWMAN RUTSTEIN
PURCHASER:
WORKFORCE SYSTEMS CORP.
By: /s/ Robert Hausman
ROBERT HAUSMAN, PRESIDENT
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