Exhibit 2.6
AGREEMENT FOR SALE OF ASSETS
AGREEMENT made and entered into by and between Perfect Copy, Inc., a
Georgia corporation with a usual place of business at 322 Oak Street,
Gainesville, GA 30501 and a second location at 2375 West Broad St Suite A,
Athens, GA, 30506 ("SELLER"), and Imtek Corporation, a Maryland corporation
qualified to do business in the Commonwealth of Virginia ("BUYER"), with its
principal place of business at 707 E. Main Street, Suite 1050, Richmond, VA
23219.
WHEREAS, Seller operates a business engaged in the sale, leasing,
rental, servicing and wholesaling of office equipment products and supplies,
including photocopy machines, typewriters, facsimile machines and various other
related equipment and products at its leased premises located at the address
herein stated; and is desirous of selling the assets of the same to BUYER as a
going business concern; and
WHEREAS, BUYER is willing to purchase said assets and continuing the
operation of the business engaged in the sale, leasing, rental, servicing and
wholesaling of office equipment products and supplies, including photocopy
machines, typewriters, facsimile machines and various other related equipment
and products on the terms as herein contained; and
NOW, THEREFORE, it is for good and valuable consideration and in
consideration of the covenants, agreements, representations, warranties, terms,
and provisions as herein contained, and mutually, and intending to be legally
bound, the parties hereto agree as follows:
ARTICLE I: Sale and Purchase of Business Assets
1.1 Transfer of Assets. Subject to the terms and conditions of this
Agreement, Buyer, in reliance upon the representations and warranties of Seller
herein made and in the exhibits and schedules annexed hereto, will at the
Closing (hereinafter defined), acquire from Seller, and Seller, in reliance upon
the representations and warranties of Buyer herein made and in the exhibits and
schedules annexed hereto, will at the Closing, transfer and convey to the Buyer,
with the exceptions set forth herein, the business, assets, properties and
contract rights of Seller, of every type and description, real, personal or
mixed, whether tangible or intangible, including the following:
(a) All of the furniture, fixtures, equipment, autos, supplies, tools
of trade and assets of every kind and description relating to or involved in any
manner with the Seller's sale, lease, rental, servicing of photocopy equipment,
typewriters, facsimile machines and other automated office equipment from its
leased business premises.
(b) All of Sellers accounts receivable of whatever source of the
Business Being Purchased, including trade and manufacturer's receivable, in the
exact amount of (accounts receivable shall be determined as of the Date of
Closing), and such amount shall be guaranteed to be collectible by the Seller
and subject to the set-off rights of Buyer as hereinafter provided.
The Schedule of Accounts Receivable to be purchased by Buyer shall be agreed to
by the Buyer and Seller and a copy shall be attached hereto as Exhibit A.
(c) All inventory, including machines, equipment, furniture, parts,
supplies, miscellaneous and rental machines located at customer's business
premises, as described on the Schedule of Inventory, of the Business Being
Purchased shall be agreed to by the Seller and Buyer and the Schedule of
Inventory shall be attached hereto as Exhibit B on the Closing Date.
(d) All rights under contracts, agreements, franchises and leases of
whatever nature, including parts and service contracts and warranty performance
agreements, books and records and all other property and rights of every kind
and nature owned or held by Seller with regard to the Business Being Purchased
on the date of Closing, as such rights and property shown on the Schedule of
Contracts to be attached hereto as Exhibit C on the Date of Closing.
(e) All of Seller's cash in transit as of the date of this Agreement.
(f) All of the goodwill and the exclusive right, privilege and
ownership in perpetuity to the logos, trademarks and name "Perfect Copy", in any
manner or form including but not limited to policy manuals, price lists,
supplier lists, customer lists, advertising, promotion, signs or otherwise of
the Business Being Purchased.
ARTICLE II: Assets to be Retained by Seller
2.1 Excluded Assets. There shall be excluded from Seller's Assets being
sold and transferred hereunder the following:
(a) All cash on hand or on deposit as of the close of business in May
31, 1998.
(b) All refundable income taxes; the cash surrender value of any life
insurance policies; and investments in marketable securities; specified
automobiles and motor vehicles; as such terms are defined and itemized on the
Schedule of Seller's Excluded Assets to be attached hereto as Exhibit D on the
Closing Date.
(c) Any liabilities, accounts payable or obligations of Seller
including any trade payables and open accounts due to the manufacturers, which
are either not expressly disclosed or which are not expressly assumed by the
Buyer herein or in a Schedule hereto, which liabilities and obligations shall
remain the responsibility of Seller and shall be paid by Seller in accordance
with their terms. The failure of Seller to pay any such debts, liabilities or
obligations shall entitle Buyer, at Buyer's option to pay same on behalf of
seller deduct any such payments, including Attorney's fees and costs incurred by
Buyer from any deferred sums due Seller as hereinafter stated or as may be
otherwise due Seller from Buyer.
ARTICLE III: Purchase Price
3.1 Purchase Price. The total purchase price to be paid to Seller for
the sale and transfer of Seller's Assets to Buyer in accordance with the
provisions of this Agreement is the approximate sum of Three Hundred Eighty
Seven Thousand and no/100 ($387,000.00) Dollars plus the buyer shall assume the
sellers liability in an amount not to exceed One Hundred Thousand and no/100
($100,000.00) Dollars for service and performance of the unexpired term for any
maintenance contracts as listed in Exhibit E. The purchase price shall be
payable in cash as provided in paragraph 3.1(a) below; and, the Buyer shall
assume the Seller's liability for service and performance of the unexpired term
for any photocopy and facsimile equipment service contracts renewed and invoiced
by Seller prior to June 1, 1998.
(a) At time of closing, Buyer shall pay the Seller the sum Three
Hundred Thirty Seven Thousand ($337,000.00) Dollars, less any sums paid directly
to Seller's creditors provided in subparagraph (c) hereinafter, and one year
from closing date, Buyer shall pay the Seller the sum of Fifty Thousand and
no/100 ($50,000.00) Dollars subject to any setoff, each of which sums shall be
payable by the Buyer's corporate check.
(b) The buyer shall assume the Seller's liability for service and
performance of the un-expired term for any photocopy and facsimile equipment
service contracts renewed and invoiced by Seller prior to June 1, 1998. The
Seller shall prepare an itemized list with terms of all such contracts. The
Schedule of Maintenance Contracts, which the Buyer is assuming hereunder and a
copy shall be attached hereto as Exhibit E on the closing Date.
(c) The buyer shall assume no other liabilities, accounts, debts or
notes payables of the Seller. All liabilities, accounts, debts and obligations,
except with respect to deferred service contracts as set forth in paragraph (b)
above, shall be paid by the Seller prior to closing or at closing from the
proceeds of the transaction or the Buyer may pay any such liabilities or debts
directly to the Seller's creditor deducting the amounts so paid from the cash
paid to the Seller at Closing as provided in Section (a) above. Attached hereto
as Schedule 3.l(c) is an itemization of the Seller's liabilities to be paid at
Closing directly by the Buyer. In the event any additional liabilities and
obligations of the Seller which accrued prior to the Closing Date and which are
not paid by the Seller or directly by the Buyer as herein provided are asserted
against the Buyer or the Assets subsequent to the Closing, the Seller shall pay
any such liabilities immediately upon demand and of the Buyer or Buyer may, in
its sole discretion, pay same on behalf of the Seller and deduct any such
payments from the deferred sums due Seller as hereinafter provided.
For illustration only, if the cost value of the inventory is determined
to be Two Hundred Forty Two Thousand ($242,000) Dollars the total purchase price
shall be Three Hundred Eighty Seven Thousand ($387,000) Dollars.
ARTICLE IV: Allocation of Purchase Price
The purchase price shall be allocated in the manner following:
$ 90,000.00 For Article Ia assets
Furniture, Fixtures & Equipment
$ 100,000.00 For Article Ib assets
Accounts Receivable
$ 242,000.00 For Article 1c assets
Inventory
$ 20,000.00 Rental Equipment
$ 35,000.00 For Article Id assets
Non Compete
ARTICLE V: Payment of Purchase Price
The purchase price as herein above to be determined in accordance with Article
III; shall be paid in the manner following:
Three Hundred Forty Thousand ($340,000) at the time of closing, payable
by Buyer's corporate check.
Fifty Thousand ($50,000) Dollars to be paid to Seller in one year. All
sums due Seller are subject to the Buyer's rights of set off as provided herein.
ARTICLE VI: Sale Free and Clear
Seller agrees that it shall sell said assets free and clear of all liens,
encumbrances, liabilities and claims of parties adverse thereto. Seller agrees
that it shall:
1. Waive all the conditions and requirements of the Bulk Sales Act; but
Seller shall complete and execute an affidavit annexed as Exhibit F.
2. At time of closing, Seller shall provide Buyer with a tax waiver
from the Department of Revenue.
3. That any and all liens, encumbrances, security agreements, tax liens
or attachments of record shall be fully discharged at time of closing.
4. Seller shall provide Buyer with an indemnity agreement as annexed as
Exhibit G, indemnifying Buyer from any asserted claims against assets sold to
Buyer.
ARTICLE VII: Seller's Warranties and Representations
The SELLER warrants and represents to BUYER with knowledge the BUYER shall rely
on same to enter into this transaction, each and all of the foregoing:
(a) That the Seller owns all and singular the assets being sold
hereunder and has full marketable title to same.
(b) That the Seller has full right and authority to enter into this
agreement and right to perform and sell hereunder.
(c) That there are no known eminent domain, condemnation or eviction
proceedings affecting the premises area containing the business or any of its
common areas.
(d) That at the time of the sale, all fixtures, office equipment, other
equipment, air conditioners, heating equipment and other apparatus shall be in
good working order at the time of passing.
(e) That seller does not have any undisclosed liabilities which have
not heretofore been paid and discharged, except (a) to the extent disclosed in
this Agreement or in any schedule annexed to this Agreement if such liabilities
are to be assumed by the Buyer; (b) those liabilities to be paid by Seller at
the closing from the proceeds of the transaction described in this Agreement;
(c) those liabilities to be paid by the Seller subsequent to the closing for
continuing obligations of the Seller.
(f) Seller has timely filed with the appropriate Federal and State
governmental agencies all tax returns and tax reports required to be filed by it
including sales tax returns and reports. Seller has paid all taxes, assessments,
fees and other governmental charges levied upon its assets and income, other
than those not yet due and payable or delinquent which Seller will pay before
delinquency. Seller has not had its federal income tax returns audited by the
Internal Revenue Service, nor has it had a State of Georgia state sales tax
audit within the last two fiscal years preceding the date of this agreement.
(g) Seller has no litigation, including any arbitration investigation
or other proceeding of or before any court, arbitrator, or governmental or
regulatory official body or authority pending or to the best knowledge of the
Seller, threatened against Seller or which relates to the Seller's Assets or the
transactions contemplated by this Agreement, nor does the Seller know of any
reasonable likely basis for any such litigation, the result of which could
adversely affect Seller, its Assets or the transactions contemplated hereby.
(h) No representations and or warranty by Seller in this Agreement, or
any documents provided hereunder, contains or will contain any untrue statement
or omits or will omit to state any material fact necessary to make the
statements contained herein not misleading.
ARTICLE VIII: Covenant Not To Compete
Jimi Epps and Donald Blackburn shall have entered into the Restrictive Covenants
Agreement in the form attached hereto as Exhibit H.
ARTICLE IX: Seller's Obligation Pending Closing
Seller agrees, warrants and covenants that during the pendency of this
agreement, that:
(a) Seller shall maintain customary hours.
(b) Seller shall maintain its customary and usual pricing and
promotional programs.
(c) Seller shall maintain an adequate stock necessary to maintain the
goodwill of the business.
(d) Seller shall maintain the current employees for the benefit of
BUYER; however nothing herein shall prevent a discharge for cause or require
BUYER to employ any present employees.
ARTICLE X: Casualty
The risk of any loss, destruction or other damage to the Seller's Assets, other
than ordinary wear and tear, between the date of execution hereof and the
completion of the Closing, shall be solely that of Seller.
ARTICLE XI: Conditions-Precedent-Concurrent-and-Subsequent
This agreement and all of BUYER'S obligations hereunder shall be fully
conditional upon the occurrence of the following:
(a) All representations and warranties of Seller contained in this
Agreement shall be true in all material respects as of and at the Closing Date.
(b) Seller shall have performed and complied with all agreements, terms
and conditions required by this Agreement on or before the Closing Date.
(c) No change other than as contemplated or permitted by this
Agreement, or other than in the normal course of Seller's business, shall have
occurred from May 15, 1998 to the Closing Date.
(d) Jimi Epps and Donald Blackburn shall have entered into the
Restrictive Covenant Agreement in the form attached hereto as Exhibit H.
(e) Seller agrees to order and deliver to Buyer appropriate Atax
clearance letters from the Department of Revenue and/or State of Georgia
evidencing current payment of all state imposed sales and/or use taxes of any
nature due or to become due through the Effective Date.
(f) At or prior to closing, Seller will obtain valid, binding, and
enforceable releases, satisfactions and/or discharges, as the case may be, of
all of the liens, charges, and encumbrances affecting Seller's Assets, except
those expressly assumed and accepted by Buyer hereunder or to be payable by
Seller after closing.
(g) Jimi Epps and Don Blackburn agree and shall have entered into the
employment contract guaranteeing a minimum one-year of service to Imtek in the
form attached hereto as Exhibit I.
ARTICLE XII: Brokers
The parties warrant and represent to each other that Jeff Sturm served as a
broker in the transaction and will be paid $23,000.00 by Imtek.
ARTICLE XIII: Miscellaneous
(1) To the extent previously not furnished to Buyer, all of Seller's
business records and papers and any order, contracts, agreements, purchase
orders, accepted or unaccepted, quotations, and any other property or records
used and usable in connection with the continued operation of Business Being
Purchased.
(2) This Agreement supersedes any and all agreements, if any,
previously made between the parties relating to the subject matter hereof, and
there are no understandings or agreements other than those included herein.
(3) Any notice, payment, request, instruction or other document to be
delivered hereunder shall be deemed sufficiently given if in writing and
delivered personally or mailed by certified mail, postage prepaid, if to Buyer:
IMTEK CORPORATION
Michael Lowe
President
707 East Main Street Suite 1050
Richmond, VA 23219
and if addressed to Seller:
Jimi Epps
322 Oak Street, Suite 1
Gainesville, GA 30501
unless in each case Buyer and Seller shall have notified the other in writing of
a different address.
(4) Headings are for convenience only and are not an integral part of
this Agreement.
(5) For value received, the receipt of which is hereby acknowledged,
any covenant, agreement, representation, warranty, or other commitment herein
made by Seller is unconditionally, individually and severally made and
guaranteed by Jimi Epps the sole shareholder of the Seller who joins in and who
executes this Agreement for such express purpose.
(6) All fees, costs, charges, expenses, taxes required to be paid or
imposed in connection withs with the negotiation, preparation or transfer of any
Seller's Assets pursuant to the terms of this Agreement shall be paid by the
Seller.
(7) The parties shlal do, undertake, execute and perform all acts and
documents reasonably required to carry out the tenor and provisions of this
Agreement.
ARTICLE XIV: Closing
The Closing shall be on June 3, 19998 with the agreement of sale of assets to be
effective June 1, 1998 at the office of the Seller, 322 Oak Street, Gainsville,
GA.
In witness whereof, the partied have executed this Agreement this
1st day of June 1998.
BUYER
IMTEK CORPORATION
BY: /s/ Michael L. Lowe
Michael L. Lowe
Its Authorized Representative
SELLER
PERFECT COPY, INC.
BY: Jimi Epps
Jimi Epps
President
GUARANTOR
Jimi Epps
BY: /s/ Jimi Epps
Jimi Epps
Individually