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Title: |
Asset Purchase Agreement |
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Entities: |
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Date: |
2001 |
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Size: |
Preview shows 17KB of 137KB total |
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Price: |
$61 |
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ID: |
#646979 |
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ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT is made and entered into this 20th day
of May, 2000 by and among COUNTRY GAS CO., an Illinois corporation (hereinafter
referred to as "SELLER"), LEONARD PETERSOHN, ARLENE PETERSOHN, the EUGENE N.
GARRISON REVOCABLE TRUST, u/t/d September 9, 1999 and the BETTY J. GARRISON
REVOCABLE TRUST, u/t/d September 9, 1999 (hereinafter referred to as the
"Shareholders"), EUGENE N. GARRISON and BETTY J. GARRISON, and Inergy Partners,
LLC, a Delaware limited liability company (hereinafter referred to as "BUYER").
RECITALS
--------
A. SELLER desires to sell to BUYER substantially all of the assets of
SELLER related to SELLER's business upon the terms and conditions hereinafter
set forth; and
B. BUYER desires to acquire such assets from SELLER upon the terms
and conditions hereinafter set forth.
AGREEMENT
---------
In consideration of the above premises, the mutual agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1. DEFINITIONS
----------------------
In addition to terms defined elsewhere in this Agreement, the
following terms shall have the meanings assigned to them herein, unless the
context otherwise dictates, both for purposes of this Agreement and all
Schedules and Exhibits hereto:
"Accounts Receivable" shall have the meaning set forth in Section
3.1(c).
"Adverse Effect" shall mean a single event, occurrence or fact or
related series of events, occurrences or facts having an adverse effect on the
Assets, Business, operations, prospects or financial condition of the Business.
"Affiliate" shall mean "affiliate" and "associate" as such terms are
defined in Rule 405 of the Securities Act of 1933.
"Agreement" or "this Agreement" shall mean this Asset Purchase
Agreement, as amended from time to time by the parties hereto, together with all
Schedules and Exhibits hereto.
"Assets" shall mean the entire right, title and interest in and to all
of the assets and properties described on Schedule 2.1 hereto, which Schedule
------------ --------
2.1 specifies the assets and properties that are owned by SELLER. It is the
---
parties' intent that BUYER acquire all of the assets and properties owned or
used by SELLER in connection with or arising out of the Business of SELLER of
every type and description, tangible and intangible, wherever located
{PAGE}
and whether or not reflected on the books and records of SELLER, but in no event
is BUYER acquiring the Excluded Assets.
"Assumed Contracts" shall mean the Contracts and Other Agreements set
forth on Schedules 2.1B, 2.1D and Part A of Schedule 2.1F and those of the type
-------------- ---- ------ -------------
described on Part B of Schedule 2.1F that do not violate any other provisions of
------ -------------
this Agreement.
"Balance Sheet" shall mean the balance sheet of Country Gas Co. dated
May 31, 1999.
"Balance Sheet Date" shall mean the date of the Balance Sheet.
"Benefit Plans" shall have the meaning set forth in Section 6.18
hereof.
"Business" shall mean the business of (i) marketing and distributing
propane gas; and (ii) selling, servicing and installing parts, appliances and
supplies related thereto on a retail basis.
"Claim Notice" shall have the meaning set forth in Section 12.4
hereof.
"Closing" shall mean the transfer by SELLER to BUYER of SELLER's
Assets and by BUYER to SELLER of the consideration set forth herein and the
consummation of the transactions contemplated by this Agreement.
"Closing Date" shall be the time of the Closing established pursuant
to Section 4.1 hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Contracts and Other Agreements" shall mean all contracts, agreements,
understandings, indentures, notes, bonds, loans, instruments, leases, subleases,
mortgages, franchises, licenses, commitments or binding arrangements, express or
implied, oral or written, whether or not enforceable.
"Country Enterprises" shall mean Country Enterprises, an Illinois
general partnership of which Leonard Petersohn, Arlene Petersohn and the
Garrison Revocable Living Trust are the partners.
"Cut-Off Date" shall have the meaning set forth in Section 15.1
hereof.
"Damages" shall have the meaning set forth in Section 12.1 hereof.
"Documents and Other Papers" shall mean and include any document,
agreement, instrument, certificate, notice, consent, affidavit, letter,
telegram, telex, statement, file, computer disk, microfiche or other document in
electronic format, schedule, exhibit or any other paper whatsoever.
"ERISA" shall have the meaning set forth in Section 6.18 hereof.
{PAGE}
"Excluded Assets" shall have the meaning set forth in Section 2.2
hereof.
"Facility" shall have the meaning set forth in Section 6.21 hereof.
"GAAP" shall mean generally accepted accounting principles
consistently applied.
"Hazardous Substances" shall have the meaning set forth in Section
6.21 hereof.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.
"Indemnified Party" shall have the meaning set forth in Section 12.4
hereof.
"Indemnifying Party" shall have the meaning set forth in Section 12.4
hereof.
"Knowledge" shall encompass all facts and information which are either
within the actual knowledge of a person or that should have been known to such
person in the exercise of reasonable care and after due inquiry.
"Lien" shall mean any lien, pledge, claim, charge, security interest
or encumbrance of any nature whatsoever.
"Liabilities" shall have the meaning set forth in Section 4.2(b)
hereof.
"Material Adverse Effect" shall mean with respect to the consequences
of any fact or circumstance (including the occurrence or non-occurrence of any
event) to SELLER, that such fact or circumstance has caused, is causing or will
cause, directly, indirectly or consequentially, singly or in the aggregate with
other facts and circumstances, any Damages in excess of One Hundred Thousand
Dollars ($100,000); provided that the foregoing shall not include the
consequences of any fact or circumstance attributable to (i) factors generally
affecting the industry in which the Business of SELLER operates, (ii) general
national, regional or local economic or financial conditions, or (iii) changes
in governmental or legislative laws, rules or regulations.
"Material Contract" shall mean and involve any Contracts and Other
Agreements, if it involves, relates to or affects the Business or the Assets or
both and if any one or more of the following applies: (i) it involves, or may
reasonably be expected to involve, the payment or receipt of Ten Thousand
Dollars ($10,000) or more (whether in cash or in goods or services of an
equivalent value) over its term, including renewal options, or Five Thousand
Dollars ($5,000) during any one year or (ii) it imposes restrictions on the
conduct of the Business, or (iii) it was not made in the ordinary and usual
course of the Business consistent with past practice, or (iv) it is a continuing
contract for the purchase, sale or distribution of materials, supplies,
equipment, products or services, or (v) it burdens, benefits, or imposes
liabilities upon, or otherwise with respect to, any real property owned or
leased by SELLER, or (vi) it is not cancelable on notice of not longer than
thirty (30) days and without liability, penalty or premium, or (vii) the present
or prospective Business is dependent upon it, or (viii) it involves the future
purchase of propane at a fixed price.
{PAGE}
"Noncompetition Agreements" shall have the meaning set forth in
Section 3.2 hereof.
"Notice Period" shall have the meaning set forth in Section 12.4
hereof.
"Organizational Documents" of an entity shall mean, if a corporation,
its articles of incorporation or certificate of incorporation, as the case may
be, and Bylaws, and if a limited liability company, its certificate of formation
and limited liability company agreement, and any other documents, agreements or
instruments relating to the creation, formation, organization, governance or
ownership of such entity.
"Parts and Appliances Inventory" shall have the meaning set forth in
Section 3.1(b) hereof.
"Permitted Encumbrances" shall have the meaning set forth in Section
6.10 hereof.
"Person" means a natural person, partnership, limited partnership,
corporation, limited liability company, trust, government, government agency and
any other legal entity.
"Preferred Interest" shall have the meaning set forth in the amendment
to the limited liability company agreement of BUYER referred to in Section 11.4
hereof.
"Propane Inventory" shall have the meaning set forth in Section 3.1(a)
hereof.
"Purchase Price" shall have the meaning set forth in Section 3.1
hereof.
"Real Property" shall have the meaning set forth in Section 6.10
hereof.
"Release" shall have the meaning set forth in Section 6.22 hereof.
"Retained Liabilities" shall have the meaning set forth in Article 5
hereof.
"Supplemental Information" shall have the meaning set forth in Section
9.11 hereof.
ARTICLE 2. PURCHASE AND SALE OF ASSETS
--------------------------------------
2.1 Assets. Subject to the terms and conditions hereof and
------
subject to the representations and warranties made herein and except as
otherwise provided in Section 2.2, at the Closing SELLER shall validly sell,
assign, transfer, grant, bargain, deliver and convey to BUYER (or to one or more
of its designees) the Assets.
2.2 Excluded Assets. Anything in Section 2.1 to the contrary
---------------
notwithstanding, the assets listed or described on Schedule 2.2 shall not be
------------
transferred to BUYER (the "Excluded Assets").
{PAGE}
2.3 Non-Assignable Contracts. This Agreement and any document
------------------------
delivered hereunder shall not constitute an assignment or an attempted
assignment by SELLER of any right contemplated to be assigned to BUYER
hereunder:
(a) Which is not assignable by SELLER without the consent of a
third party if such consent has not been obtained and such assignment or
attempted assignment would constitute a breach thereof; or
(b) If the remedies for the enforcement or any other particular
provisions thereof available to SELLER would not pass to BUYER.
SELLER shall use all efforts to obtain such consents of third parties as may be
necessary for the assignment of such right by SELLER. To the extent that such
right of SELLER is not assignable or where consents to the assignment thereof
cannot be obtained as herein provided, SELLER shall, at the Closing, assign to
BUYER the full benefit thereof (which shall be deemed to be Assets) and, at
BUYER's option, either (i) grant to BUYER an irrevocable power of attorney to
perform SELLER's covenants and obligations under such rights in respect of the
period after the Closing Date, and to enforce SELLER's rights thereunder in the
name of SELLER but for the benefit of BUYER, or (ii) continue to perform its
covenants and obligations under such rights and SELLER shall take or cause to be
taken such action in its name or otherwise as BUYER may require so as to provide
BUYER with the benefits thereof and to effect collection of money or other
consideration to become due and payable under such items and SELLER shall
promptly pay over to BUYER money received by SELLER in respect of all of the
foregoing items.
ARTICLE 3. PURCHASE PRICE
-------------------------
3.1 Aggregate Purchase Price. The aggregate purchase price (the
------------------------
"Purchase Price") for the Assets and the Noncompetition Agreements is Seventeen
Million Thirty-six Thousand Dollars ($17,036,000), plus an amount equal to the
sum of the following:
(a) The inventory of propane gas (i) located in SELLER's bulk
storage tanks and bobtails on the Closing Date and useable and saleable
in the ordinary course of the Business of SELLER, the amount of such
inventory to be based upon a reading from the sight gauge located on such
bulk storage tanks and bobtails taken jointly by a representative of
BUYER and a representative of SELLER on or as soon after the Closing Date
as practicable, but in any event within five (5) days after the Closing
Date, and priced based upon the lowest wholesale delivered price at which
SELLER could purchase propane on the Closing Date and (ii) owned by
SELLER and stored in third party storage facilities, and priced based
upon the lower of actual cost or market price at such storage facility
(the "Propane Inventory");
(b) The inventory of parts and appliances of SELLER on the Closing
Date usable and saleable in the ordinary course of the Business of
SELLER, with the amount of such inventory to be based upon a physical
inventory taken jointly by a representative of BUYER and a representative
of SELLER on or as soon after the Closing Date as practicable, but in any
event within thirty (30) days after the Closing
{PAGE}
Date, and priced based upon the average cost method for inventory
regularly employed by SELLER in its inventory accounting practices (the
"Parts and Appliances Inventory");
(c) Accounts receivable arising from the Business of SELLER and
owned by SELLER as of the Closing Date that are actually collected within
one hundred twenty (120) days following the Closing Date (the "Accounts
Receivable");
(d) The capital expenditures set forth in Schedule 3.1(d) at the
---------------
total amount shown therein (the "Capital Expenditures");
(e) The amount of SELLER's propane deposits on account with
suppliers on the Closing Date on all of SELLER's outstanding contracts
for the purchase of propane at a fixed price (the "Propane Deposits");
and
the Purchase Price shall be decreased by an amount equal to the
following:
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