SNTL 8-K
Sentinel Holdings Ltd. (SNTL)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
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(Address of principal executive offices and zip code)
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Securities registered pursuant to Section 12(b) of the Act:
NONE
SECURITIES MARKET WHERE STOCK TRADES
Title of each class |
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Common Stock, par value $.001 per share |
| SNTL |
| OTCMKTS |
(Former name or former address, if changed since last report)
Not Applicable
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
ITEM 2.01 Completion of Acquisition or Disposition of Assets.
On October 16th, 2025, the Company acquired all of the service contracts of Opsec Specialized Protections, Inc. along with its work force and certain intangible assets, for a purchase price of $650.000 paid in cash, and additional terms set forth below.
Pursuant to a consulting agreement with the Seller, the principal shareholder/CEO of the Seller will continue to work in the business over six months at a salary of $50,000 per month.
Provided at least 80% of the current active security services accounts of the business acquired by the Company are in the aggregate providing the same level of income per month or more than they provided at closing, the Company will pay the Seller an additional Performance Bonus of One Hundred Fifty Thousand Dollars ($150,000.00). Total revenues for the month of September, 2025, from service contracts, the month proceeding the closing, totaled approximately $799,000, and cash expenses for the month totaled approximately $604,000. 80% revenues from service contracts equaled approximately $639,000 in the month of October.
The Company also entered a six month lease with Fred Porras, the majority shareholder of the Seller, to rent Mr. Porras’ office space where the Seller’s business was located, at a rental rate of Five Thousand Five Hundred Dollars ($5,500.00) per month, on a triple net basis. Almost all liabilities of the business were retained by Seller and not assumed by the Company.
ITEM 5.02. CHANGE IN CONTROL.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
Financial statements required by this item are not included, but will be filed by an amendment to this report not later than 71 calendar days after the date of this filing,
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2.01 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| By: | /s/ Kyle Madej |
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| Chief Executive Officer |
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| Date: | November 11, 2025 |
AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT
(Effective Date: October 7, 2025)
This Amendment No. 1 to Asset Purchase Agreement (“Amendment”) is entered into as of
October 7, 2025, by and between:
Opsec Specialized Protection Inc., a California corporation (“Seller”),
Fred Porras, majority shareholder of Seller, and
Sentry Protect Services, a Wyoming corporation (“Buyer”),
the wholly owned subsidiary of Sentinel Holdings Ltd.
Collectively, the above are referred to as the “Parties.”
WHEREAS, the Parties entered into that certain Asset Purchase Agreement (the “Agreement”) dated October 3, 2025, for the sale and purchase of substantially all of Seller’s assets; and
WHEREAS, the Parties now desire to amend the Agreement to provide for Buyer’s early operational takeover and to establish additional payment and insurance terms.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
Effective October 7, 2025, Buyer shall assume operational control of the Business, including all active accounts, employees, and daily operations. Buyer agrees to add all accounts to its insurance policy as of this date.
1A.Temporary Operation by Seller
The Parties further agree that, notwithstanding Buyer’s assumption of control as of October 7, 2025, the Seller shall continue to operate and manage the Business on behalf of Buyer until October 15, 2025. During this interim period, Seller shall oversee all ongoing operations, personnel management, and client services to ensure a smooth transition of accounts and operations to Buyer. In consideration of such continued operation, Seller shall retain and collect all income and receivables generated by the Business from all active accounts through October 15, 2025. Effective October 16, 2025, Buyer shall assume all operational control, billing rights, and entitlement to account income.
(a)Buyer shall immediately add all active accounts to its commercial general liability and workers’ compensation insurance policies.
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(b)Buyer shall provide the Seller with a Certificate of Insurance (COI) evidencing that all accounts have been added.
(c)Buyer shall also provide a Declaration Page naming the Landlord as Additional Insured under Buyer’s insurance policy.
(d)Buyer shall further provide proof that all business vehicles have been added to Buyer’s insurance policy effective October 7, 2025.
Buyer agrees to make payments to Seller and Seller’s Broker as follows:
October 7, 2025 (Today):
•$150,000 to Seller, and
•$50,000 to Seller’s Broker, Liberty Business Advisors of San Francisco.
On or before October 15, 2025:
•$350,000 to Seller, and
•$100,000 to Seller’s Broker, Liberty Business Advisors of San Francisco.
All payments shall be made by wire transfer in immediately available funds.
Except as expressly amended herein, all other terms and provisions of the original Asset Purchase Agreement shall remain in full force and effect. In the event of any conflict between this Amendment and the Agreement, the terms of this Amendment shall govern.
This Amendment may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Signatures delivered electronically or by DocuSign shall be deemed binding for all purposes.
IN WITNESS WHEREOF, the Parties have executed this Amendment as of the date first above written.
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NEW REVISED ACQ AGREEMENT FRIDAY 10 03
THIS ASSET PURCHASE AGREEMENT (the “Agreement”), is entered into as of the date below
written (the “Execution Date”), by and between Opsec Specialized Protection Inc. a California Corporation ( “Seller" herein), Fred Porras, the majority shareholder of Seller (“Porras”) and Sentry Protect Services, a Wyoming Corporation (the “Buyer” herein) and the wholly owned subsidiary of Sentinel Holdings Ltd..
WITNESSETH
WHEREAS, Seller Opsec Specialized Protection Inc, desireS to sell, and desires to purchase, substantially all of Seller’s assets, including specifically the
Good Will of the Seller’s Business, free and clear of all liens, claims and encumbrances; and
WHEREAS, the Parties desire to enter into this Agreement for the purpose of accomplishing said sale and setting forth their mutual rights and obligations with respect to the transaction.
NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged and accepted, and in consideration of the premises and mutual promises herein contained, the Parties, intending to be legally bound, hereby agree as follows:
ARTICLE 1
TRANSFER OF ASSETS
1.1 Sale of Assets. At the Closing and subject to the terms and conditions of this Agreement, other than the Excluded Assets, Seller shall sell, transfer, convey, assign and deliver to Buyer, and Buyer shall purchase from Seller, all rights, title, and interest in and to all assets of every description, and whether real, personal or mixed, tangible or intangible, owned or leased by Seller and held or used in the Seller’s Business, including the following items (collectively, the “Acquired Assets”):
(a) All tangible and intangible assets of the Entity, including furniture, fixtures & equipment (FF&E), current active accounts, and a list of inactive accounts available, as described on Schedule 1.1(a), but expressly excluding vehicles and accounts receivable and the Real Property (Building) described on Schedule 1.1(a) as not included. Accounts receivable are billed in arrears, and shall be allocated based on services rendered before or after the closing.
(b) All contractual rights relating to the Personal Property used in the operation of the Business to which Seller is a Party, including those described on Schedule 1.1(b). NONE
(c) All Contracts and contract rights of Seller, whether pertaining to contracts to provide security services, or otherwise relating to the Acquired Assets and/or the Business of the Seller, of any type or nature, including those listed on Schedule 1.1(c). KYLE HAS
(d) All real property leases, leasehold interests or other contractual rights, interests, easements and appurtenances relating to the Business (whether as (sub)lessor or (sub)lessee) (the “Real Property Leases”) to which Seller is a Party, including the Real Property Leases described on Schedule 1.1(d). NONE
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(e) To the extent transferable or assignable and subject to any applicable consent requirements, rights to all state, federal, special or local licenses or permits (including, but not limited to, air, water or other environmental licenses and permits), rights, certificates of need, certificates of exemption, franchises, accreditations, registrations, permits, approvals and consents, and all applications therefor and waivers of any requirements pertaining thereto (each a “License” and collectively, the “Licenses”), if any, issued to Seller for the Acquired Assets or the Business, including the Licenses described on Schedule 1.1(e). Buyer may rely on Sellers permits and licenses briefly after close to continue business, until replaced with Buyer’s name. ATTACH AS SCHEDULE 1.1 (e)) all city and state licenses and permits.
(f) All computer hardware and data processing equipment held by Seller or used primarily in the conduct of its Business or the operation of the Acquired Assets, and, to the extent assignable or transferable, all rights in all warranties of any manufacturer or vendor with respect thereto and the computer software listed on Schedule 1.1(f); MIKE TO PREPARE LIST AND ATTACH AS SCHEDULE
(g) All inventories of usable goods and supplies of the Business owned by or, with respect to the business owned by Seller, including uniforms, utility belts, medical kits, pharmaceuticals and medications, food, supplies, office supplies, forms, consumables, disposables, existing and wherever located (collectively, the “Purchased Inventory”). LIST 400 UNIFORMS OWNED BY SELLER. MIKE TO ATTACH CONTRACT WITH UNIFORN COMPANY.
(h) The deposits, prepaid expenses or other advance payments of Seller relating to the Business which are assumable and usable by Buyer listed on Schedule 1.1(h) (collectively, the “Prepaid Expenses”). MIKE TO LIST. EG UTILITY DEPOSITS
(i) To the extent transferable or assignable and subject to any applicable consent requirements, all documents, books, records, operating and policy manuals and files owned by Seller, pertaining to or used primarily in connection with the Business, operations of Seller or the Acquired Assets, whether in hard copy or other form, including all patient records, medical records, financial records, equipment records and securities and administrative libraries, personnel records and purchase and vendor records, existing and wherever located (collectively, the “Transferred Records”), but excluding the Excluded Records, subject to the Parties’ rights under this Agreement. ALL. KYLE ALL READY HAS.
(j) To the extent held or used in or ancillary to the Business or operation of the Acquired Assets, trademarks, trade names, service marks, copyrights and any applications therefor, mask works, net lists, schematics, technology, know-how, trade secrets ideas, algorithms, process, domain names or intangible proprietary information or material set forth on Schedule 1.1(j). NONE
(k) The names, logos and symbols used by Seller in connection with the Business or the Acquired Assets, including the name, all goodwill associated with the Business of Seller as a going concern, all warranties (express or implied) and all telephone and facsimile). PUT numbers as currently used by Seller primarily in support of the Business. Set forth on Schedule 1.1(K). PUT ON SCHEDULE: LOGO, WEBSITE, PASSWORDS FOR WEBSITE, FLYERS AND ALL PROMOTIONAL MATERIALS
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(l) Any insurance proceeds and insurance proceeds receivable (including applicable deductibles, co-payments or self-insured requirements) arising from the Acquired Assets. NONE
(m) All claims of Seller against third parties, choate or inchoate, known or unknown, contingent or otherwise, relating to the Acquired Assets. NONE KNOWN
(n) All the Good Will of the business known as Opsec Specialized Protection Inc. (the “Business”).
(o) All rights to continue employment of 7 office personnel working in the office. PUT ON SCHEDULE THE 7 NAMES AND ADDRESS AND TELEPHONE NUMBERS, AND SALARIES OF EACH.
1.2 Excluded Assets. Notwithstanding anything to the contrary, Seller is not selling, and Buyer is not purchasing or assuming obligations with respect to, the following assets which shall remain the property of Seller after the Closing (the “Excluded Assets”):
(a)All vehicles.
(b)Accounts receivable.
(c)All cash in corporate accounts.
(d)Real property consisting of land and building located in Landcaster, Calif.
(e)The corporate record books, minute books, corporate seals and tax records of Seller and all records of any kind that Seller is required by Legal Requirements to retain in its own possession (collectively, the “Excluded Records”), subject to the Parties’ rights herein.
(f)All claims of Seller against third parties, choate or inchoate, known or unknown, contingent or otherwise, relating to the Excluded Assets.
(g)Such other property and assets, if any, specifically described on Schedule 1.2(d). NONE
(h)All claims for refunds of Taxes, if any, and other governmental charges of whatever nature pertaining to Business operation before the closing
(i)All personnel records and other books and records (or copies thereof, as applicable) that Seller is required by law to retain in its possession; provided, however, that the originals or copies of all such records shall be provided to Buyer at the Closing.
(j)All accounts receivable of Seller, and all rights to payment, whether billed or unbilled, recorded or unrecorded, accrued and existing, whether or not written off, as of the Closing date with respect to the Business, including, without limitation, rights to payment all goods and services that Seller provides prior to the closing date, (collectively, the “Accounts Receivable”).
(k)All bank accounts of Seller.
(l)All interest in AV Security Academy.
1.3 Assumption of Liabilities. As of the Closing date, Buyer shall assume and agree to pay, discharge and perform according to their terms only the following liabilities and obligations of Seller (collectively, the “Assumed Liabilities”):
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(a) All liabilities and obligations arising out of operation of the Business or the use or ownership of the Acquired Assets after the closing date.
(b) Notwithstanding the above, all liabilities and obligations of Seller as of the Closing date for accrued paid time off expenses, whether for vacation sick pay or otherwise (collectively, the “Accrued PTO”), attributable to the Seller’s Employees prior to the closing date will not be assumed by Buyer; Seller shall pay to Buyer in immediately available funds as of the Closing date an amount equal to the Accrued PTO expenses attributable to the Seller’s Employees reflected on the Seller’s books as of the Closing Date or arising from its operation of the Business prior to the Closing date, to be held in trust by Buyer for such employees.
1.4 Excluded Liabilities. Except for the Assumed Liabilities, Buyer shall not assume or become liable or obligated in any way and Seller shall retain and remain solely liable for any obligation to pay, perform and discharge all Liabilities of Seller, regardless of when asserted, including without limitation, any of the following (collectively, the “Excluded Liabilities”):
(a)Any obligations or liabilities of Seller under the Excluded Contracts accrued prior to the closing date.
(b) Any obligation or liability of Seller arising out of or relating to any violation of any Legal Requirements prior to the Closing date.
(c)Any obligation or liability of Seller arising out of or relating to any Employee Benefit Plan of any nature whatsoever maintained by Seller or its Affiliates for the benefit of its or their employees.
(d)Any accounts payable reflected on the Seller’s books as of the Closing Date or arising from the operation of the Business prior to the Closing date.
(e)Obligations or liabilities for Taxes, including, without limitation, (1) any Taxes arising as a result of Seller’s operation of the Business or ownership of the Acquired Assets prior to the Closing date; (2) any Taxes that will arise as a result of the sale of the Acquired Assets pursuant to this Agreement; and (3) any deferred Taxes of any nature; provided however, it is acknowledged that Buyer shall have the obligation to pay its proportionate share of all personal property Taxes due as a result of the ownership or operation of the Acquired Assets following the Closing date.
(i)Seller’s expenses relating to this Agreement.
(j)All liability claims or other claims for acts or omissions of Seller.
1.5 Purchase Price.
(a)Subject to the terms of this Agreement, the consideration payable by Buyer for the Acquired Assets will be $650,000 (the “Purchase Price”), which represents payment for the good will of the business and the assets specified.
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1.6 Closing; Closing date.
(a) The closing of the transactions contemplated by this Agreement shall take place at 12:00 a.m., local time, as soon as practical, and in any event on or before October or before 31, 2025 at Los Angeles, California, or at such other time and date and/or at such other location as the Parties may mutually designate in writing (such closing being called the “Closing” and such date being called the “Closing Date”).
(b) The transactions contemplated by this Agreement shall be effective as of 11:59 p.m. on the closing date.
(c) At the Closing, Seller shall deliver to Buyer the Seller’s Closing Documents.
(d) At the Closing, Buyer shall deliver the payment of the Purchase Price and the Buyer’s Closing Documents. Buyer shall wire $500,000 of the Purchase Pric to the Seller on the Closing Date, and per the direction of the Seller, acknowledged by Seller’s execution of this Agreement, the balance of the Purchase Price, being $150,000, shall be wired to Liberty Business Advisors of San Francisco (the Seller’s broker), on the closing date, on behalf of Seller.
1.7 Tax Allocation. The Purchase Price will be allocated among the Acquired Assets for all Tax purposes in accordance with Section 1060 of the IRS Code. After the Closing, the Parties shall make consistent use of such allocation for all Tax purposes and in any Tax Returns filed with the Internal Revenue Service in respect thereof, including IRS Form 8594. In any Proceeding related to the determination of any Tax, neither Buyer nor Seller shall contend or represent that such allocation is not a correct allocation.
1.8 Conveyances.
Conveyance of the Personal Property and intangible property, and all Good Will of the Business shall be by a Bill of Sale and Assignment between Seller and Buyer.
1.9 Consulting Fee:
Buyer shall execute at the closing, a Consulting Agreement with Seller for a period of six (6) months following the closing date. Under this Consulting Agreement, Buyer shall pay a consulting fee of Fifty Thousand Dollars ($50,000.00) per month, payable to Seller , on a 1099 basis. Seller shall provide the services of Fred Porras to perform the Consulting Agreement services under this Consulting Agreement, to Buyer. Under the terms of the Consulting Agreement, Seller agrees to provide the services of Fred Porras to provide personally a minimum of 20 hours per week of consulting services. Upon successful completion of the six-month consulting period, and provided Buyer has successfully transitioned at least 80% of the current active security services accounts of the business to Buyer, and such accounts are in the aggregate providing the same level of income per month or more than they provided at closing, Buyer shall pay Seller an additional Performance Bonus of One Hundred Fifty Thousand Dollars ($150,000.00) as a final balloon payment at the end of the term of the consulting agreement six months out from closing. In this regard, Buyer shall not make any decision over said six month period to reduce services to customers, unless either customers request such reduction in Services, or Seller consents in writing to reduction of services.
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It is expressly agreed and acknowledged by all Parties that any loss, reduction, or termination of customer accounts attributable to the Buyer’s deliberate reduction in personnel, or deliberate increases in pricing of services shall not be construed against Seller, or create liability for Seller. Any loss of accounts as a result of complaints about frequency of vehicle patrol services, which are currently serviced by the Seller’s vehicles, shall not be attributed to Seller since Buyer has elected not to purchase such vehicles as part of the transaction It is Seller’s responsibility, acting through Porras over said six month period to help Buyer retain all current accounts, for the Business hereby acquired by Buyer. But Porra shall not be required to make any solicitation calls or participate in any marketing social events.
Consultation Duties of Seller
Seller agrees to provide consultation services to Buyer for a period of six (6) months following the transfer of the Business (“Consultation Period”). The scope of Seller’s duties during the Consultation Period shall be to assist Buyer and Buyer’s staff with learning and understanding the existing operations of the Business, assisting Buyer in making a smooth transition of contract service accounts over to the Buyer, assisting Buyer staff with handling service complaints during the six month period, meeting with representatives of very large paying contracts and the Buyer’s representative to make introductions and smooth the transition, preparing a Notice letter from Seller, with Buyer’s input and prior approval, notifying service customers of the change over to Buyer, and assisting in collections on the accounts. Such duties shall also include, but are not limited to, instruction on day-to-day business operations, responding to client emails, assisting with the handling of client complaints, and preparing or reviewing proposals in the ordinary course of business.
It is expressly understood and agreed that Seller shall not be required, nor shall it be considered part of Seller’s obligations, to go out into the community to solicit or obtain new business, perform cold-calling activities, or act in any similar sales capacity for the purpose of securing new accounts.
UCC-1 Filing Right
Any failure by the Buyer to perform under the Consulting portion of this Agreement without cause shall be deemed a material breach of the Agreement, and Seller shall have the right to file a UCC-1 Financing Statement against the Business assets acquired under the Agreement. Such filing shall remain in effect until the matter is resolved or the obligations are satisfied in full.
1.10 Six-month Lease
Fred Porras, the majority shareholder of Seller, (“Porras”), agrees, at the closing, to execute a six-month lease, whereby Porras personally leases to Buyer that certain property generally described as therein to Buyer, and Buyer agrees to lease said property from Fred Porras for said six months at a rental rate of Five Thousand Five Hundred Dollars ($5,500.00) per month, on a triple net basis. Said lease to be in the form as attached here to as Schedule 1.10.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF SELLER
As of the Execution Date and again as of the Closing Date, Seller and Porras jointly and separately, hereby represents and warrants to Buyer that, except as contained in the disclosure Schedules attached hereto and incorporated herein:
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2.1 Organization, Corporate Power and Authority.
(a) Seller is a duly formed, validly existing and in good standing under the laws of the State of California, and is duly qualified to do business and is in good standing under the laws of the State of California . Seller has the corporate power and authority to own, lease, license, and operate and hold its properties and to carry on its Business as now conducted and to sell all of its assets as contemplated herein
(b) Seller has full corporate power and authority to execute, deliver and perform the corporate obligations and covenants contained in this Agreement and Seller’s Closing Documents and to carry out the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and Seller’s Closing Documents by Seller and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of Seller. This Agreement constitutes the legal, valid and binding obligation of Seller, enforceable in accordance with its terms, subject to applicable Exceptions.
Each of Seller’s Closing Documents, when duly executed and delivered by Seller to Buyer, will constitute the legal, valid and binding obligation of Seller enforceable in accordance with its respective terms.
(b) Seller shall deliver to Buyer at the closing a copy of adopted resolutions of Seller’s Board of Directors, authorizing this transaction, certified as correct by the Seller’s Secretary and notarized.
2.2 No Breach. Neither the execution and delivery of this Agreement and related agreements contemplated herein by Seller nor the consummation or performance of the transactions contemplated hereby or in the Seller’s Closing Documents will, directly or indirectly (with or without notice, lapse of time or both): (i) conflict with or result in any violation of or constitute a breach or default under any term of:
(A) Seller’s respective charter documents, bylaws, the articles of organization, operating agreements or other organizational documents of Seller.
(B) any Contract, permit or other instrument to which Seller is a party, or by which Seller is bound or to which the Seller’s Business or any of the Acquired Assets is subject, assuming however all third party consents to assignments of customer Contracts have been obtained,
(C) any judgment to which Seller, the Business or any of the Acquired Assets is bound or subject, or
(D) any Legal Requirement that (ii) will result in the creation of any lien or other encumbrance upon the Business or the assets which are a part of the Acquired Assets, or (iii) trigger any notice to or any permit, authorization, consent or approval of any Governmental Authority or of any other Person, in order for or required for Buyer to carry on the Business.
2.3 Assets.
(a) Except as described on Schedule 2.3(a), Seller is the sole and exclusive legal and equitable owner of all right, title and interest in, has good and marketable title in fee simple absolute to, and is in possession of all Acquired Assets. Except as described on Schedule 2.3(a), no Affiliate of Seller or any Person has any direct or indirect ownership, leasehold or other interest in the Acquired Assets. As of the Closing Date, all of the Acquired Assets will be free and clear of any encumbrances.
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(b) The Acquired Assets and the Excluded Assets constitute all assets which are held or used by Seller in the conduct of the Business and it’s operations. The Acquired Assets constitute all assets that are necessary for Buyer to conduct the Business and operate it as currently conducted.
2.4 No Outstanding Rights. Except as described on Schedule 2.4, there are no outstanding rights (including any right of first refusal), interests, options or Contracts giving any Person any current or future right to obtain an equity interest in Seller or to require Seller or, from and after the Closing date, requiring Buyer, to sell or transfer to such Person or to any third party any interest in any of the Acquired Assets.
2.5 Personal Property Leases.
(a) Schedule 1.1(b) is an accurate and complete list of any and all Personal Property Leases involving Seller (but excluding the Equipment Leases set forth in Schedule 1.1(b)). The Seller does not have any liability with respect to any of such Personal Property Leases except as expressly set forth therein.
(b) Equipment Leases. Schedule 2.5(b) is an accurate and complete list of all equipment leased or subleased by Seller or any of its Affiliates (the listed equipment being collectively called the “Leased Equipment”), including identification of the lease or sublease affecting such Leased Equipment or any interest therein to which the Seller or any of its Affiliates now are a party or by which any of such entity’s interests in the Leased Equipment is or will be bound. Neither the Seller nor any of its Affiliates have entered into a Contract or made a commitment to lease equipment other than as disclosed in Schedule 2.5(b). Seller and/or its Affiliates are in peaceable possession of the Leased Equipment and have exclusive use of the Leased Equipment. Except as disclosed on Schedule 2.5(b), none of such Leased Equipment is subject to any licenses, use restrictions, exceptions, reservations, limitations or other impediments which adversely affect the value to the Business of the leasehold interest therein or which interfere with or impair the present and continued use thereof in the usual and normal conduct of the Business as currently conducted. Except as disclosed on Schedule 2.5(b), none of such Leased Equipment is subject to any lien (except liens for current taxes not yet due and payable, and liens to be discharged prior to the Closing date by Seller) which could, by foreclosure or enforcement, terminate or otherwise adversely affect any Personal Property Lease to which the Leased Equipment is subject.
2.6 No Violation of Law. Seller (a) is not in violation of any Legal Requirements and (b) has not received any current written notice of any alleged violation or non-compliance with any Legal Requirement.
2.7 Legal Proceedings. Except as described on Schedule 2.7, there are no Proceedings instituted or pending or threatened against Seller that challenge, or may have the effect of preventing, delaying, making illegal or otherwise interfering with, the transactions contemplated hereby, and there are no Orders outstanding or threatened against Seller that challenge, or that may have the effect of preventing, delaying, making illegal or otherwise interfering with, the transactions contemplated hereby. LIST ON SCHEDULE 2.7 ALL LITIGATION MATTERS THAT ARE ACTIVE.
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Except as described on Schedule 2.7, Seller is not a party to any Proceedings, and Seller and the Acquired Assets are not subject to any Orders. Seller has not received notice of any pending action, suit, Proceeding or investigation by or before any court, arbitrator or Governmental Authority concerning the Business or the affairs of Seller or to which the Acquired Assets are subject, and, to Seller’s Knowledge, there is no basis for any such action. There is no action, suit or Proceeding or investigation that is currently being threatened in writing against Seller or against any stockholder, officer, director, manager, member or employee of Seller in relation to or otherwise involving the Business, the Acquired Assets or affairs of Seller. LIST ON SCHEDULE 2.7 ALL MATTERS UNDER AUDIT WITH THE IRS OR STATE AUTHORITIES.
2.8 Fees and Commissions. Any fees associated with the retention of a financial advisor, broker or other intermediary who has acted on behalf of Seller in connection with the negotiation or consummation of this Agreement or the transactions contemplated thereby are the sole and exclusive obligation of the Seller, including any broker’s, finder’s or originator’s fees or commissions by reason of services rendered for or, at the instance of, Seller, in connection with this Agreement or the transactions contemplated hereby.
2.9 Material Contracts. Schedule 2.9 lists all Material Contracts. Except as described on Schedule 2.9, each Material Contract (a) has been entered into by Seller in the normal course of its Business, and (b) is in full force and effect, and has not been amended or modified except as described on Schedule 2.9. Seller is not currently in default in any material respect, nor has Seller received any written notice that it is in default, with respect to any Material Contract, and no other party to any Material Contract is currently in default in any material respect or has any defense, counterclaim or offset right. Seller has not assigned or encumbered any such Material Contract in any manner. Each of Seller’s in place contracts to provide securities services at this date is deemed a material contract. I AM TOLD KYLE ALREADY HAS
2.10 Insurance. Schedule 2.10 sets forth a true and complete list of all insurance policies or self-insurance funds maintained by Seller covering the ownership and operation of the Business and the Acquired Assets, indicating the types of insurance, policy numbers, terms, identity of insurers and amounts and coverages (including applicable deductibles). Seller has one or more “business interruption” insurance policies in customary form and amount covering Business and the Acquired Assets (which coverage includes coverage from the date hereof until the Closing Date), and the proceeds of such policies are assignable to Seller as to the period from the date hereof until the Closing Date, if the Closing occurs as contemplated hereunder. All of such policies are now and will be until the Closing in full force and effect on an occurrence basis with no premium arrearages. Such policies of insurance shall not be assigned to Buyer as part of the Acquired Assets and Buyer acknowledges that all of the coverages listed on Schedule 2.10 with respect to the Purchased Assets will cease with respect to events occurring after the Closing date.
2.11 Tax Matters.
(a) For purposes of this Section, “Tax Returns” means all reports, estimates, declaration of estimated Tax, information statements and returns relating to, or required to be filed in connection with, any Taxes and any schedules attached to or amendments of (including
refund claims with respect to) any of the foregoing.
(b) Except as described on Schedule 2.11 (i) all Tax Returns required to be filed by or on behalf of Seller in respect of income, assets or other items relating to Seller, and/or its Business in all cases, have been duly filed on a timely basis or within the applicable final extension periods granted to it(ii) such Tax Returns are true, complete and correct in all respects; and (iii) all Taxes owed by Seller with respect to any taxable period or partial taxable period of Seller ending prior to the Closing date have been paid or will be timely paid by Seller.
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2.12 Absence of Certain Changes or Events.
Except as set forth in Schedule 2.12.
(a), there has not been any development (including consummation of the transactions contemplated hereby) or threatened development of a nature which would be reasonably likely to cause any material adverse change in the financial condition, net worth, assets, liabilities, personnel, or operations of Seller, including any of the Seller’s or its Affiliate’s relationships with Seller’s customers and/or employees, or the ability of Seller to perform its obligation under this Agreement and any related agreements.
(b) Except as specifically set forth in Schedule 2.12, and except as expressly authorized by this Agreement to accomplish the transactions contemplated hereby, since January 1, 2025, Seller has conducted (and from the date hereof through the Closing date, will continue to conduct) the Business and its operations only in the ordinary course in all material respects. Without limiting the generality of the foregoing, since January 1, 2025, and, except as set forth on Schedule 2.12 and, except for transactions required to affect this Agreement, Seller has not (and from the Execution Date through the Closing date, will not):
(i) create or suffer to exist any liens, encumbrances or other restrictions with respect to any of the Acquired Assets;
(ii) sell, lease to others, license to others, dispose of, or otherwise transfer any of the material assets or properties of the Business;
(iii) suffered any material loss, or material interruption in use, of any material asset or property of the Business (whether or not covered by insurance) on account of fire, flood, riot, strike or other hazard or act of God;
(iv) purchase, call, redeem or otherwise acquire (other than for cash) or declare or pay any dividends or other distributions (other than cash) on or with respect to, any equity interest in Seller or any of its Affiliates;
(v) (A) increased the rate or terms of compensation (including termination and severance pay), commission, bonus or other direct or indirect remuneration (or the rate thereof) payable or to become payable to any of Seller’s employees, officers, directors or persons otherwise serving in such capacities, other than regularly scheduled increases in base salary in the ordinary course and consistent with past practice in all material respects;
(B) adopt, amend or terminate any Employee Benefit Plan, or entered into any employment, consulting, severance or termination agreement;
(vi) waived any rights relating to the Business or arising under or in connection with any of the Acquired Assets;
(vii) acquire any assets or properties other than in the ordinary course and consistent with past practice;
(viii) entered into any merger, consolidation, recapitalization or other business combination or reorganization (other than this sale of assets);
(ix) make any loans, advances or capital contributions to or investments in any Person,
(x) induced any employee to leave his or her employment, or act to otherwise adversely affect the relations with any such employee;
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(xi) delay payment of payables, change credit practices or do anything to materially and adversely affect the relationship of the Business with any customers or supplier that is material to the Business;
(xii) make any purchase commitment materially in excess of the usual requirements of the Business or at any price materially in excess of the then-current market price or upon terms and conditions more onerous than those usual and customary in the industry or make any material change in its selling, pricing, advertising or personnel practices inconsistent with its prior practice;
(xiii) commenced or terminated any line of business;
(xiv) make any change in its general pricing practices or policies or any change in its credit or allowance practices or policies other than in the ordinary course;
(xv) received written notice from any customer representing during the last fiscal year sales or purchases of $2,000 or more that such customer or supplier has ceased, may cease or will cease to do business with it;
(xvi) enter into any transaction, agreement, contract or understanding with any Person (other than Buyer) affecting the Business or altered the terms of any transaction, agreement, contract or understanding with any Person (other than Buyer) materially affecting the Business;
(xvii) without limiting the foregoing, entered into any material transaction for the business resulting in a liability or expenditure that is not prior approved in its sole discretion by Buyer in writing;
(xviii) enter into any material amendment, modification, termination (partial or complete) or grant any material waiver under or give any material consent with respect to any Contract that is required to be disclosed in the Schedules to this Agreement; (xix) make any change in any method of accounting or accounting practice that applies to Seller;
(xx) make or defer any material capital expenditure without the prior written consent of Buyer:(xxi) except for this Agreement, entered into any oral or written agreement, contract, commitment, arrangement or understanding with respect to any of the matters described in this Section 2.12.
2.12 Employees.
(a) Schedule 2.13 lists the employees of Seller and their current rates of compensation, dates of hire, status (i.e., exempt or non-exempt) and eligibility for, and participation in, Employee Benefit Plans. NEED THIS SCHEDULE ATTACHED.
Except as described on Schedule 2.13 NONE
(i) there are no collective
agreements or bargaining relationships or other contracts or understandings with any labor organization with respect to Seller’s employees, (ii) the Seller has no Knowledge of any organizational effort presently being made or threatened by or on behalf of any labor union with respect to employees of the Seller, and to the Seller’s Knowledge no such efforts have occurred within the past three years, (iii) there is no worker’s compensation liability, experience or matter outside the Ordinary Course of Business, (iv) there are no strikes, slowdowns, work stoppages, material grievances, material unfair labor practices claims or other material employee or labor disputes currently pending or threatened against or involving the Seller and none has occurred within the last three years, (v) the Seller has not engaged in any unfair labor practices within the meaning of the National Labor Relations Act, (vi) during the three year period preceding the Closing Date, the Seller has not implemented any layoffs of employees that could implicate the Worker Adjustment and Retraining Notification Act, 29 U.S. Stat. § 2101 et seq. (the “WARN Act”), (vii) there are no pending or threatened in writing complaints or charges before any
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Governmental Authority regarding employment discrimination, safety or other employment related charges or complaints, wage and hour claims, unemployment compensation claims, worker’s compensation claims or the like involving any current or former employee of Seller,
(viii) Seller is in compliance in all material respects with all Legal Requirements and Contracts respecting employment and employment practices, labor relations, terms and conditions of employment and wages and hours, including those applying to the provision of security services, both armed and unarmed and (ix) Buyer will not be subject to any claim or liability for severance pay as a result of the consummation of the transactions contemplated by this Agreement as long as Buyer fulfills its obligations under the term of this Agreement.
(b) All Employee Benefit Plans maintained by the Seller or to which the Seller is obligated to contribute, are listed on Schedule 2.13 hereto. With respect to the Employee Benefit Plans:
(i) a copy of each such Employee Benefit Plans has been made available to the Buyer and/or its agents;
(ii) all such Employee Benefit Plans have been maintained, funded and administered in compliance in all material respects with all applicable Legal Requirements, including ERISA and the Code;
(iii) no Employee Benefit Plan is or has within the last three years been subject to the minimum funding requirements of Section 412 or 430 of the Code or Title IV of ERISA;
(iv) the Seller does not have any obligation to contribute to any “multiemployer plan” within the meaning of Section 3(37) of ERISA;
(v) each Employee Benefit Plan intended to qualify under Section 401(a) of the Code has received a favorable determination letter or is entitled to rely on an opinion letter from the Internal Revenue Service that such Employee Benefit Plan is a “qualified plan” under Section 401(a) of the Code, the related trust is exempt from tax under Section 501(a) of the Code, and no facts or circumstances exist that would be reasonably likely to jeopardize the qualification of such Employee Benefit Plan; and
(vi) with respect to the Employee Benefit Plans, all required contributions have been made or properly accrued on the Seller’s financial statements.
2.14 Financial Information.
(a) Schedule 2.14 hereto contains the following financial statements and financial information (collectively, the “Historical Financial Information”): (i) balance sheets and income statements of the Seller for the twelve-month periods ended and
; (ii) unaudited balance sheet and income statement of the Seller dated for the last three fiscal years; and (iii) the most recently available unaudited balance sheet and income statement of Seller. I’M TOLD KYLE HAS. BUT WE NEED TO ATTACH.
The financial statements included in the Historical Financial Information have been prepared in accordance with GAAP, applied on a consistent basis throughout the periods indicated provided that the unaudited statements are not footnoted and are subject to customary year end adjustments, and Seller has not changed any accounting policy or methodology throughout all periods presented. The balance sheets contained in the Historical Financial Information present fairly in all material respects the financial condition of Seller as of the dates indicated thereon, and the income statements contained in the Historical Financial Information present fairly in all material respects the results of operations of Seller for the periods covered thereby.
(b) Except for (i) liabilities that are disclosed in this Agreement, the Historical Financial Statements, Contracts entered into in connection herewith and schedules and exhibits hereto and thereto, and (ii) liabilities that were incurred after, in the ordinary course of business, there are no material liabilities of any nature of Seller relating to its business or the Acquired Assets and Assumed Liabilities.
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2.15 Intellectual Property.
(a) Except as described on Schedule 2.20, there is no unauthorized use, disclosure, infringement or misappropriation of any intellectual property rights of Seller, any trade secret of Seller, or any intellectual property right of any third party to the extent licensed by or through Seller, including any employee or former employee of Seller, relating in any way to any of the Acquired Assets. There are no royalties, fees or other payments payable by Seller to any Person by reason of the ownership, use, sale or disposition of intellectual property related to any of the Acquired Assets except as set forth in the Contracts.
(b) Except as described on Schedule 2.15, Seller is not nor will be as a result of the execution and delivery of this Agreement or any of the documents described herein or the performance of its obligations under this Agreement or any of the documents described herein, in breach of any license, sublicense or other Contract relating to the intellectual property included in the Acquired Assets.
(c) Except as described on Schedule 2.15, Seller has no patents, registered trademarks, registered service marks or registered copyrights related to any of the Acquired Assets, and Seller is not infringing upon any patents, trademarks, service marks, copyrights or in violation of any trade secret or other proprietary right of any third party related to any of the Acquired Assets. Seller has not brought any Proceeding against any third party for infringement of intellectual property or breach of any license or Contract involving intellectual property related to any of the Acquired Assets.
2.16 The seven office employees at the Seller’s office have all indicated a desire to stay on and be employed by the Buyer.
2.17Completeness of Disclosure. No representation or warranty by Seller in this Agreement or statement made by Seller in any schedule to this Agreement, or any certificate or other document furnished or to be furnished to Buyer pursuant hereto, or in connection with the negotiation, execution or performance of this Agreement, contains or will at the Closing contain any untrue statement of a material fact or omits or will omit to state a material fact required to be stated herein or thereon or necessary to make any statement herein or therein not misleading in any material respect.
EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS ARTICLE 2, THE ACQUIRED ASSETS ARE BEING SOLD TO BUYER “AS IS, WHERE IS, AND WITH ALL FAULTS”, AND SELLER EXPRESSLY DISCLAIMS ANY AND ALL OTHER REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER
As of the Execution Date and again as of the Closing Date, Buyer represents and warrants to Seller that, except as contained in the disclosure Schedules attached hereto and incorporated herein:
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3.1 Organization, Corporate Power and Authority.\
(a) Buyer is a duly organized, validly existing and in good standing under the laws of the State of Californa.
(b) Buyer has full corporate power and authority to execute, deliver and perform the corporate obligations and covenants contained in this Agreement and Buyer’s Closing Documents and to carry out the transactions contemplated hereby and thereby. The execution
and delivery of this Agreement and Buyer’s Closing Documents by Buyer and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of Buyer. This Agreement constitutes the legal, valid, and binding obligation of Buyer, enforceable in accordance with its terms, subject to applicable Exceptions. Each of Buyer’s Closing Documents, when duly executed and delivered by Buyer and the other Parties thereto, will constitute the legal, valid and binding obligation of Buyer, enforceable in accordance with its respective terms.
3.2 No Breach. Neither the execution and delivery of this Agreement and related agreements contemplated herein by Buyer nor the consummation or performance of the transactions contemplated hereby or in the Buyer’s Closing Documents will, directly or indirectly (with or without notice, lapse of time, or both): (i) conflict with or result in the breach or violation of the governing documents of or resolutions adopted by Buyer; (ii) conflict with or result in the breach or violation of any provision of any Order of any Governmental Authority, in either such case, to which Buyer, or any of the Acquired Assets, are bound, or cause any acceleration thereof; or (iii) contravene, conflict with, or result in a violation in any Legal Requirements. Except for the other approvals and consents described on Schedule 3.2, Buyer is not and will not be required to give any notice to or obtain any consent from any Governmental Authority in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby.
3.4 Fees and Commissions. No finder, broker, agent, financial advisor or other intermediary has acted on behalf of Buyer in connection with the negotiation or consummation of this Agreement or the transactions contemplated thereby, and Buyer has not directly or indirectly agreed to pay or become liable to pay any broker’s, finder’s, or originator’s fees or commissions by reason of services alleged to have been rendered for, or at the instance of, Buyer in connection with this Agreement or the transactions contemplated hereby.
3.5 Funding of Purchase Price. The Buyer has sufficient cash available to enable it to fulfill its obligations hereunder and to make payment of all amounts to be paid by it hereunder on the Closing Date, it being acknowledged that there is no financing contingency as a condition to Buyer’s obligation to complete this transaction.
ARTICLE 4
CONDITIONS TO THE OBLIGATIONS OF BUYER
The obligations of Buyer to consummate the purchase of the Acquired Assets and any other transaction contemplated by this Agreement are subject to the satisfaction, on or before the Closing Date, of the following conditions:
4.1 Representations and Warranties to be True and Correct. The representations and warranties of Seller contained in ARTICLE 2 shall be true, complete and correct in all material respects on and as of the Execution Date and the Closing Date with the same effect as though such representations and warranties had been made on and as of such date, and an officer of Seller shall have certified to such effect to Buyer in writing.
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4.2 Covenants. Seller shall have performed and complied with all of its covenants hereunder through Closing.
4.3 No Action or Proceeding. No Order of any Governmental Authority restraining, enjoining or otherwise preventing or delaying the consummation of this Agreement or the transactions contemplated hereby shall be outstanding, and no Proceedings or investigations by or before, or otherwise involving, any Governmental Authority shall be threatened or pending against Seller or Buyer which seeks to enjoin or prevent the consummation of the transactions contemplated under this Agreement or which seeks damages in connection with the transactions contemplated hereby.
4.4 Licenses, Consents. Buyer shall have been issued, or shall have received approval of approval of the transfer of, all Licenses necessary to enable Buyer to own and use the Acquired Assets and operate the Business. Buyer shall have been issued, or shall have received approval or assurance of approval of the transfer of all customer service contracts of Seller to Buyer, which constitute the service contracts for securities services hereby acquired by Buyer.
4.5 Seller’s Closing Deliverables. Buyer and its counsel shall have received executed copies of the following documents (the “Seller’s Closing Documents”):
(a) Bill of Sale and Assignment. A bill of sale and assignment , executed by Seller conveying to Buyer good and marketable title to all tangible assets, including Personal Property, which are a part of the Acquired Assets and good and marketable title to all intangible assets which are a part of the Acquired Assets, free and clear of all encumbrances .
(b) Assignment and Assumption Agreement. An Assignment and assumption agreement, (the “Assignment and Assumption Agreement”) executed by Seller: (i) conveying to Buyer all of Seller’s right, title and interest in, to and under the Assumed Contracts and (ii) consents from each Contract holders stating Buyer is authorized to assume the future performance on each customers contract in the place and stead of Seller, .
(d) Authorizing Resolutions. Copies of duly adopted resolutions of the board of directors of Seller, authorizing and approving Seller’s performance of the transactions contemplated hereby and the execution and delivery of this Agreement and the Seller’s Closing Documents, certified by the appropriate officer or officers of Seller as true and in full force and effect as of
the Closing.
(e) Certificates. Receipt of certificates executed by Seller and dated as of the Closing Date and reasonably satisfactory in form and substance to Buyer, certifying that (i) each of the representations and warranties of Seller contained herein is true and correct on and as of the Closing Date, and (ii) Seller shall have performed and complied with all agreements, obligations, covenants and conditions required to be performed or complied with by them pursuant hereto on or prior to the Closing Date, except as may have been waived in writing by Buyer.
(f) Secretary’s Certificate. A certificate of the Secretary or an Assistant Secretary of Seller dated as of the Closing Date and certifying: (i) that attached thereto is a true and complete copy of all resolutions adopted by the directors and shareholders of Seller authorizing the execution, delivery, and performance of this Agreement and all transactions contemplated by this Agreement and that all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated by this Agreement; and (ii) to the incumbency and specimen signature of each officer of Seller executing this Agreement or the other documents to b edelivered by Seller pursuant to this Agreement, and a certification by another officer of Seller as to the incumbency and signature of the officer signing the certificate referred to in this Section 4.5(f).
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(g) FIRPTA Certificate. A FIRPTA certificate, executed by Seller certifying Seller’s U.S. taxpayer identification number and that Seller is not a foreign Person, within the meaning of Section 1445 of the Code.
(hj) Certificate of Good Standing. A certificate of good standing of Buyer from the Secretary of State of the State of dated no earlier than ten (10) days prior to the Closing.
4.6 No Material Casualty. Between the Execution Date and the Closing date, no Material Casualty shall have occurred. A “Material Casualty” shall mean damage or destruction of any part of the Acquired Assets by fire or the elements or by any other cause and the cost to repair such damage is reasonably likely to exceed the insurance coverage . In the event of a Material Casualty, Seller shall within fifteen (15) business days after such Material Casualty provide written notice thereof to Buyer. Such notice shall include copies of all insurance policies then in force relating to the Acquired Assets covering such Material Casualty and, Seller’s initial good faith estimate of the cost to repair such damage or destruction (“Cost Estimate”). Buyer may, by written notice to Seller within twenty (20) days after Buyer’s receipt of notice of the Material Casualty, elect in writing to terminate this Agreement. Should Buyer terminate this Agreement in accordance with the provisions of this Section 4.6, this Agreement shall be terminated. If any part of the Acquired Assets is damaged or destroyed prior to the Closing Date but this Agreement cannot be terminated or is not terminated by Buyer, this Agreement shall not be affected and the parties shall not be excused from performance hereunder, but, as of the Closing date, at Buyer’s request, Seller shall assign to Buyer all of its right, title and interest in and to the proceeds of insurance insuring against the loss and Seller’s interest in sums payable thereunder or, to the extent that such proceeds are less than the CostEstimate, make payment to Buyer in amount that together with such proceeds equals the Cost Estimate.
ARTICLE 5
CONDITIONS TO THE OBLIGATIONS OF SELLER
The obligations of Seller to consummate the sale of the Acquired Assets and any other transaction contemplated by this Agreement are subject to the satisfaction, on or before the Closing Date, of the following conditions.
5.1 Representations and Warranties to be True and Correct. The representations and warranties of Buyer contained in ARTICLE 3 shall be true, complete and correct in all material respects (except to the extent qualified by materiality or Material Adverse Effect, in which case they shall be true and correct in all respects in accord with those standards) on and as of the Execution Date and the Closing Date, with the same effect as though such representations and warranties had been made on and as of such date, and an officer of Buyer shall have certified to such effect to Seller in writing.
5.2 Performance. Buyer shall have performed and complied in all material respects with all of its covenants hereunder through Closing.
5.3 No Action or Proceeding. No Order of any Governmental Authority restraining, enjoining or otherwise preventing or delaying the consummation of this Agreement or the transactions contemplated hereby shall be outstanding, and no Proceeding or investigations by or before, or otherwise involving, any Governmental Authority shall be threatened or pending against Seller or Buyer which seeks to enjoin or prevent the consummation of the transactions contemplated under this Agreement or which seeks material damages in connection with the transactions contemplated hereby.
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5.4 Buyer’s Closing Deliverables. Seller and their counsel shall have received executed copies of the following documents (the “Buyer’s Closing Documents”):
(a) Assignment and Assumption Agreement, executed.
(b) Certificates. Receipt of a certificate executed by Buyer, dated as of the Closing Date and reasonably satisfactory in form and substance to Seller, certifying that (i) each of the representations and warranties of Buyer contained herein is true and correct in all material respects on and as of the Closing Date, and (ii) Buyer has performed and complied in all material respects with all agreements, obligations, covenants, and conditions required to be performed or complied with by them pursuant hereto on or prior to the Closing Date, except as may have been waived in writing by Seller.
(c) Certificate of Good Standing. A certificate of good standing of Buyer from the Secretary of State of the State of dated no earlier than ten (10) days prior to the Closing. (d) Secretary’s Certificate. A certificate of the Secretary or an Assistant Secretary of Buyer dated as of the Closing Date and certifying: (i) that attached thereto is a true and complete copy of all resolutions adopted by the members of Buyer authorizing the execution, delivery, and performance of this Agreement and all transactions contemplated by this Agreement and that all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated by this Agreement; (ii) an incumbency and specimen signature of each officer of Buyer executing this Agreement or the other documents to be delivered by Buyer pursuant to this Agreement, and a certification by another officer of Buyer as to the incumbency and signature of the officer signing the certificate referred to in this Section 5.4(d).
ARTICLE 6
ADDITIONAL AGREEMENTS
6.1 Retention and Access to Records. After the Closing Date, Buyer shall retain the Transferred Records for a period consistent with Buyer’s record retention policies and practices, but in any event for at least the minimum period for which such Transferred Records are required to be retained under applicable Legal Requirements. Buyer also shall provide Seller and its representatives reasonable access thereto, during normal business hours and on reasonable prior written notice, to enable them to prepare financial statements, tax returns, respond to tax audits or any other reasonable business purpose.
6.2 Access to Acquired Assets; Contracts.
(a) Between the Execution Date and the Closing Date, Seller shall afford to the authorized representatives and agents of Buyer reasonable access to and the right to inspect the properties, books and records of Seller relating to the Business and the Acquired Assets, and the enforce service contracts of Seller to be acquired by Buyer, and will furnish Buyer with such additional financial and operating data and other information as to the Business and the Acquired Assets as Buyer and it’s representatives may from time to time reasonably request.
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Buyer’s right of access and inspection shall be made in such a manner as not to interfere unreasonably with the operation of Seller’s Business or Seller’s use of the Acquired Assets.
(b) This Agreement shall not constitute an attempt to assign any Acquired Asset or assume any Assumed Liability, if the attempted assignment or assumption of same, as a result of the absence of a consent or authorization of a third party, would constitute a breach or default under any lease, agreement or commitment or would in any way adversely affect the rights, or increase the obligations, of Buyer or Seller with respect thereto. Except as otherwise agreed to by the Parties, Buyer and Seller shall cooperate in good faith for obtaining any consent or authorization of a third party necessary for the assignment of any Acquired Asset to Buyer or the assumption by Buyer of any Assumed Liability. With respect to any Acquired Asset, if Seller fails to obtain the consent or authorization necessary for the assignment of such Acquired Asset prior to Closing, then Buyer may, at its option and expense, require Seller to enter into such arrangement (including sublease, agency, pass through, indemnity or payment arrangement) as reasonably necessary to provide Buyer with the benefits of such Acquired Asset. With respect to any Assumed Liability, Buyer agrees to cooperate with Seller to the extent reasonably necessary to relieve Seller from the obligations of such Assumed Liability. Seller shall get the consent of parties to service contracts maintained by Seller, and deliver them to Buyer prior to the closing date.
6.3 Misdirected Payments. Seller shall promptly remit to Buyer any monies received by Seller after Closing constituting or in respect of the Acquired Assets or Assumed Liabilities or Buyer’s operation of the Business on or following the Closing date. Buyer shall promptly remit to Seller any monies received by Buyer after Closing constituting or in respect of the Excluded Assets or Excluded Liabilities or Seller’s operation of the Business prior to the Closing date.
6.4 Cooperation on Tax Matters. Following the Closing, the Parties shall reasonably cooperate with each other and shall make available to the other, as reasonably requested and at the expense of the requesting Party (but including only out-of-pocket expenses to third parties photocopying and delivery costs), to any Tax authority, all information, records or documents relating to Tax liabilities or potential Tax liabilities, if any, of Seller for all periods on or prior to the Closing and any information which is relevant to determining the amount payable under this Agreement, and shall preserve all such information, records and documents (to the extent a part of the Acquired Assets delivered to Buyer at Closing) until the expiration of any applicable statute of limitations or extensions thereof. Seller shall make available to Buyer the records of individual wages of all employees, as well as copies of state unemployment Tax returns, to the extent reasonably necessary for Buyer to verify future unemployment Tax rates and to calculate the correct taxable payroll for the remainder of the calendar year in which the transaction occurs. Seller shall file terminating Forms W-2 and Forms 1099 with respect to all periods ending prior to the Closing Date, as appropriate.
6.5 Cooperation.
The Parties shall reasonably cooperate with each other and with their respective representatives in connection with any steps required to be taken as part of their respective obligations under this Agreement, and shall (i) furnish upon written request to each other such further information; (ii) execute and deliver to each other such other documents; (iii) cooperate and provide reasonable assistance during any payroll transition; and (iv) do such other acts and things, all as the other Party may reasonably request, for the purpose of carrying out the intent of this Agreement and the contemplated transaction.
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6.6 Costs and Charges.
(a) Transfer and Other Taxes. Seller shall be responsible for the cost of any and all state, county, local and municipal transfer and/or excise stamps or Taxes, however denominated, required as a result of the transfer of the Acquired Assets hereunder to Buyer.
(b) Professional Fees. Buyer and Seller shall each pay their own professionals’ fees and expenses, including those of attorneys, investment bankers and accountants.
6.7 Employees.
(a) Buyer shall not be required to hire any former employee of Seller whose employment record indicates such person is ineligible for rehire consistent with Buyer’s standard practices with respect to employment of former employees.
(b) Seller or a Seller Affiliate shall provide continuation coverage, to the extent it is required to do so under COBRA, (i) to all former employees of Seller (and its Affiliates) who incur COBRA “qualifying events” prior to the Closing date (and their covered dependents) and (ii) to all employees who do not become Employees of Buyer (and their covered dependents), to extend Buyer is required to do so.
(c) Buyer shall employ and retain for such period of time following the Closing Date such number of Seller’s Employees as shall be necessary to avoid any potential liability by Seller for a violation of the Workers Adjustment and Retraining Notification Act, 29 U.S. Stat. § 2101 et seq. (the “WARN Act”), attendant to Seller’s (or Seller Affiliate’s) failure to notify such Employees of a “mass layoff” or “plant closing” (as such terms are defined in the WARN Act). Buyer shall be liable and responsible for any notification required under the WARN Act (or under any similar state or local Laws) and Buyer shall indemnify and hold Seller and its Affiliates harmless from and against any liability asserted against Seller or any Seller affiliate under the WARN Act as a result of Buyer’s failure to comply with the provision of the WARN Act as of or after the Closing Date or Buyer’s failure to comply.
(d) At the Closing, Seller shall deliver to Seller copies of all personnel records of the Seller Employees. Seller shall coordinate with Buyer promptly after the Execution Date to provide Buyer reasonable access to employees of Seller and its Affiliates. 6.8 Change of Name. On or before the Closing Date, Seller shall (a) amend its charter and take all other actions necessary to change its name to one sufficiently dissimilar to Seller’s present name, in Buyer’s judgment, to avoid confusion, and (b) take all actions requested by Buyer to enable Buyer to use any names acquired by Buyer at the Closing if it chooses to do so. From and after the Closing Date, Seller shall make no further use of (i) the name or any derivative thereof, or (ii) any other name that, in Buyer’s reasonable judgment, is sufficiently similar to so as to potentially cause confusion.
6.9 Conduct of the Company. During the period from the date of this Agreement and continuing until the Closing, the Seller agrees that, except as expressly contemplated or permitted by this Agreement or the Schedules; as required by any Legal Requirement; or to the extent that the Buyer shall otherwise consent in writing, which consent shall not be unreasonably withheld, conditioned or delayed:
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(a) the Seller shall use reasonable efforts to carry on its business in the usual, regular and ordinary course in all material respects, in substantially the same manner as heretofore conducted; provided, however, that no action by the Seller with respect to matters specifically addressed by any other provision of this Section shall be deemed a breach of this Section , unless such action would constitute a breach of one or more of such other provisions;
(b) other than as may be required by or in conformance with Legal Requirements in order to permit or facilitate the consummation of the transactions contemplated hereby or the transactions disclosed in the Schedules, the Seller shall not sell, encumber or otherwise dispose of, or agree to sell, encumber or otherwise dispose of, any of its material assets other than in the ordinary course of business consistent with past practice;
(c) other than as required by an existing contract or agreement as in effect on the date hereof and other than in the ordinary course of business consistent with past practice, the Company shall not (i) increase the amount of cash compensation or severance pay of any officer, (ii) make any material increase in, or commitment to increase materially, any employee benefits or (iii) adopt or make any commitment to adopt any material Employee Benefit Plan.
6.10 Broker Indemnification Buyer agrees to j indemnify, defend and hold harmless Liberty Business Advisors of San Francisco, together with its agents, representatives, and Houmehr Mike Panoussi (DRE Lic. No. 01853627), from and against any and all claims, liabilities, losses, damages, costs, or expenses (including reasonable attorneys’ fees) arising out of the wrongful deliberate act or gross negligence act of Buyer.
Seller agrees to j indemnify, defend and hold harmless Liberty Business Advisors of San Francisco, together with its agents, representatives, and Houmehr Mike Panoussi (DRE Lic. No. 01853627), from and against any and all claims, liabilities, losses, damages, costs, or expenses (including reasonable attorneys’ fees) arising out of the wrongful deliberate act or gross negligence act of Seller.
ARTICLE 7
TERMINATION
7.1 Termination. This Agreement may be terminated at any time prior to the Closing:
(a) by the mutual written consent of the Buyer and the Seller;
(b) by the Seller, if there has been a material breach by the Buyer of any covenant, representation or other agreement or term contained herein which has prevented the satisfaction of any condition to the obligations of the Seller at the Closing and such breach has not been waived by the Seller or cured by the Buyer within ten business days after the Buyer’s receipt of written notice thereof from the Seller;
(b) by the Buyer, if there has been a material breach by the Seller of any covenant, representation or other agreement or term contained herein which has prevented the satisfaction of any condition to the obligations of the Buyer at the Closing and such breach has not been waived by the Buyer or cured by the Seller within ten business days after the receipt of written notice thereof from the Buyer;
(c) by the Seller, if the transactions contemplated hereby have not been consummated on or before October 31, 2025 ; provided that the Seller shall not be entitled to terminate this Agreement pursuant to this Section if the Seller’s breach of it obligations under this Agreement has prevented the consummation of the transactions contemplated herein;
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(d) by the Buyer, if the transactions contemplated hereby have not been consummated on or before October 31, 2025 ; provided that the Buyer shall not be entitled to terminate this Agreement pursuant to this Section if the Buyer’s breach of this Agreement has prevented the consummation of the transactions contemplated hereby; or
(f) by the Buyer upon (i) the failure of the representations and warranties of Seller described herein in to be true and correct in all material respects as of the Closing Date, or
(ii) a Governmental Authority orders in writing that the transactions contemplated by this Agreement not be completed or notifies Buyer or Seller in writing that it is investigating such transaction for compliance with Legal Requirements. The party desiring to terminate this Agreement pursuant to this section shall give written notice of such termination to the other party hereto.
7.2 Effect of Termination. In the event this Agreement is terminated by either the Buyer or the Seller, the provisions of this Agreement shall immediately become void and of no further force and effect, and there shall be no liability on the part of the Buyer or the Seller to any other party hereto, and the party breaching the Agreement shall pay to the other party all attorneys fees and costs incurred in connection with negotiating and executing the Agreement by the non-breaching party.
ARTICLE 8
INDEMNIFICATION
8.1 General.
The representations and warranties made by each Party herein shall survive the closing and/or termination of this Agreement for a period of six months after the Closing.
8.2 The Seller shall defend, indemnify and hold harmless, the Buyer and its respective directors, from and against any and all Losses suffered or incurred by Buyer after the date hereof as a result of or arising out of: (i) the falsity or incorrectness of or breach of any representation or warranty of Seller in this Agreement;
(ii) The failure by Seller to perform any covenant or agreement applicable to it in the Transactions.
(iii) Any and all claims lodged against Buyer, its’ officers, directors, shareholders, or affiliates, by the Estate of Seller’s deceased former minority shareholder.
8.3 The Buyer shall defend, indemnify and hold harmless, the Seller from and against any and all Losses suffered or incurred by Seller after the date hereof as a result of or arising out of:
(i) the falsity or incorrectness of or breach of any representation or warranty of Buyer in this Agreement;
8.4 The representations and warranties of each Party set forth in this Agreement shall expire and be of no further force or effect on the date that is 6 months after the Date selected as the Closing Date, provided, however, with respect to any matter as to which a reasonable and good faith claim for indemnification has been duly noticed hereunder and is pending or unresolved at the end of the above Period, such claim shall continue to be covered by the indemnification provisions hereof, and the Indemnifying Party shall remain potentially liable therefor, until resolved.
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8. 5 Seller shall not be dissolved prior to the end of 24 months following the Closing Date.
ARTICLE 9
MISCELLANEOUS
9.1 No Shop. Except for the sale of inventory and other assets in the ordinary course, Seller agrees that, from the date hereof through the date of consummation or earlier termination of this Agreement, it shall not, and shall not permit any of its Affiliates or employees or any investment banker, attorney, adviser or other representative of Seller to, directly or indirectly, (i) offer for sale or solicit offers to buy the Business, any part of the Acquired Assets or any interest in Seller, (ii) hold discussions or negotiate with, or provide information to, any Person (other than Buyer) with a view towards such an offer or solicitation or with a view towards a sale of any equity interest in or a merger or consolidation of any entity owning the Acquired Assets, or (iii) enter into any Contract with any such Person relating to the sale or other disposition of any of the Seller’s assets or any part of the acquired Assets.
9.2 Non Compete, Confidential Information
a. Seller and Fred Porras, jointly and individually, on behalf of themselves, their agents, representatives and affiliates, each acknowledge that (i) Buyer is purchasing all of the Business’ Good Will from Seller; and (ii) it is a condition precedent to the Buyer’s obligation to consummate the transactions contemplated by the Asset Purchase Agreement that Buyer acquire all the Good Will of the Business: and (iii) Buyer would not have entered into the Asset Purchase Agreement unless the Seller and Porras agreed to sell to Buyer all of the Good Will of the Business; and (iv) the Seller hereby enters the following non-competition agreement in order to protect the Business’ Good Will so being acquired by Buyer. The Seller and Porras agree not to start a business, join a business, conduct a business, or work for a competitor of the Business being sold hereby, within the California counties of Los Angeles and Ventura, which is or would be competitive with the Business of Seller being acquired, for a period of thirty-six months from the date of Closing. The sale price for the Business being acquired pursuant to the terms of this Agreement, serves in part as the consideration for this non-compete provision, as it's exchanged for the seller's promise not to compete.
b. Each of Seller and Porras acknowledges that he, she or it is and will be in possession of Confidential Information concerning the Business, including, but not limited to, information about markets, key personnel, current and prospective customers and other business affairs and methods and other information not readily available to the public; provided, however, that, for purposes of this Agreement, Confidential Information shall not include information which (a) is or becomes generally available to the public other than as a result of wrongful disclosure by any Porras or the Seller, or (b) becomes available to P orras or the Seller, as applicable, from a third party without restriction or breach of this Agreement and, to their knowledge, without breach of any other confidentiality obligation owed to the Buyer. As a means reasonably designed to protect the Confidential Information, and to protect the Good Will of the Business acquired by the Buyer, from the Closing Date above until the third anniversary of the Closing Date, the Seller and Porras agree that they will not, directly or indirectly (including through Affiliates), within the geographic region of Los Angeles and Ventura Counties, California, engage in, assist (financially or otherwise), render services to, or perform any activity that is competitive with, or substantially similar to the Business (the “Protected Activities”). Notwithstanding the foregoing, each of Porras and the Seller may own, directly or indirectly, an aggregate of no more than one percent (1%) of the outstanding stock or other equity interest of or in any publicly traded corporation or other business enterprise that engages in the Protected Activities, provided that such participation therein is solely as a passive investor and does not include any role, as applicable, as director, officer, manager or other service provider.
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c. From the Closing Date until the third anniversary of the Closing Date, neither the Seller nor Porras will, without the prior written consent of the Purchaser, directly, indirectly (including through his, her or its Affiliates) or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity: (a) hire, solicit, encourage the resignation of, or in any other manner seek to engage or employ, any person who, as of the Closing Date or at any time during the six (6) month period prior thereto, was an employee of the Seller and was engaged in the Business (provided, however, that if any such employee is hired by the Buyer and thereafter terminated by the Buyer, then the Seller may hire such person), or (b) contact, solicit, service or otherwise have any dealings with any person or entity with whom the Purchaser has a then-current business relationship in connection with the Protected Activities if such contact, solicitation or other dealings could reasonably be expected to adversely impact the Buyer’s relationship with such person or entity. This shall not preclude Seller from rendering consulting services to Buyer after the Closing as contemplated by this Agreement.
d. Unless otherwise approved in writing by the Purchaser, each of Porras and the Seller covenants and agrees that he, she or it will not use for any purpose and will keep secret and will not intentionally disclose to anyone other than the Buyer, any and all Confidential Information about the Business.
f. It is expressly agreed among the parties hereto that monetary damages would be inadequate to compensate a party hereto for any breach by any other party of its covenants and agreements in this Article. Accordingly, the parties agree and acknowledge that any such violation or threatened violation will cause irreparable injury to the other and that, in addition to any other remedies which may be available, such party shall be entitled to injunctive relief against the threatened breach of this Agreement or the continuation of any such breach without the necessity of proving actual damages and without posting any bond or other security, and may seek to specifically enforce the terms of this Agreement.9.3 Broker Indemnification
Buyer agrees to indemnify, defend and hold harmless, Liberty Business Advisors of San Francisco, together with its agents, representatives, and Houmehr Mike Panoussi, from and and against all claims, liabilities, lossess, damages costs or expenses, including reasonable attorneyls fee, arising of out of the negotiation, execution performance or enforcement of this Agreement, as a result of the Buyers harmful intentional or tortious acts.
Seller each agree to indemnify, defend and hold harmless, Liberty Business Advisors of San Francisco, together with its agents, representatives, and Houmehr Mike Panoussi, from and and against all claims, liabilities, lossess, damages costs or expenses, including reasonable attorneyls fee, arising of out of the negotiation, execution performance or enforcement of this Agreement, as a result of the Sellers harmful intentional or tortious acts.
9.3 Amendments. This Agreement may not be amended, modified or supplemented, and no provision hereof shall be waived, without the signed written consent of all the Parties hereto and clearly expressing such intent.
9.4 Waiver. Failure to insist upon strict compliance with any of the terms, covenants, or conditions of this Agreement at any one time shall not be deemed a waiver of such term, covenant, or condition at any other time, nor shall any waiver or relinquishment of any right or power herein at any time be deemed a waiver or relinquishment of the same or any other right or power at any other
time.
9.5 Notices. All notices, payments, or other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given only if sent by hand delivery or by recognized overnight courier, or by email, addressed as follows (or to such other addresses subsequently designated by a Party from time to time pursuant to this Section ):
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If to Seller to: | Attn: Fred Porras |
with a copy to: | 44262 Division Street |
| OPSEC Specialized Protection |
| Lancaster, CA 93535 |
If to Buyer, to: | Sentinel Holdings Ltd |
Copy to: | Santa Clara CA 95050 |
| 2010 El Camino Real #517 |
9.6 Counterparts. This Agreement may be executed in any number of counterparts (including by means of telecopied signature pages or signature pages sent electronically in a .pdf format), each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.
9.7 Enforceability and Severability. In the event any provision of this Agreement or portion thereof is found to be wholly or partially invalid, illegal, or unenforceable in any Proceeding, such provision shall be deemed to be modified or restricted to the extent and in the manner necessary to render the same valid and enforceable, or shall be deemed severed from this Agreement, as the case may require, and the balance of this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision had been originally incorporated herein as so modified or restricted or as if such provision had not been originally contained herein, as the case may be.
9.8 Governing Law. This Agreement shall be construed in accordance with the laws of the State of California, without regard to conflicts of laws principles.
9.9 Assignment. This Agreement shall not be assigned or delegated by any Party without the signed prior written consent of the other Party; provided, however, that Buyer may, without the written consent of the other Party (a) assign any or all of its rights and interests hereunder to one or more of its Affiliates and (b) designate one or more of its Affiliates to perform its obligations hereunder, provided that such assignment shall not relieve Buyer of any of its obligations or liabilities hereunder. Absent an express written agreement among the Parties to the contrary, any assignment, delegation, or designation shall not release a Party from any obligations under this Agreement, and the delegating or designating Party shall remain liable, jointly and severally, with any delegate or designee with respect to all obligations of the delegating or designating Party under this Agreement. Any purported assignment, delegation, or designation in violation of this Section 9.9 is void.
9.10 Expenses. Each Party will pay its own expenses in connection with the transactions contemplated hereby, whether or not such transactions shall be consummated.
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9.11 Parties in Interest. All representations, covenants, and agreements contained in this Agreement by or on behalf of any of the Parties hereto shall bind and inure to the benefit of the respective successors and permitted assigns (if any) of the Parties hereto.
9.12 Consents. No consent or approval contemplated hereunder shall be unreasonably withheld, conditioned, delayed or denied.
9.13 Third Parties. Except as specifically contained herein, this Agreement does not and is not intended to create any rights in any Person which is not a Party to this Agreement.
9.14 Entire Agreement. This Agreement, including the Schedules and Exhibits hereto and agreements referenced herein, constitutes the sole and entire agreement and understandings of the Parties with respect to the subject matter hereof, and supersedes and terminates any and all prior agreements, discussions, negotiations or communications. All Schedules and Exhibits hereto are incorporated herein by reference.
9.15 Specific Performance; Injunctive Relief. Each Party shall have the right, in addition to any other rights and remedies existing in its favor, to enforce its rights and the obligations of the other Party hereunder not only by an action(s) for damages but also by an action(s) for specific performance, injunctive and/or other equitable relief, without posting any bond or other undertaking. The Parties acknowledge and agree that any breach or threatened breach of any post-Closing covenant by any Party will likely result in some irreparable injury.
9.16 Headings; Construction. The headings of Articles and Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. All words used in this Agreement will be construed to be of such gender or number as the context requires. All references to documents, instruments or agreements will be deemed to refer as well to all addenda, exhibits, schedules or amendments thereto, but only to the extent existing as of the date hereof.
9.17 Applicable Date. Any reference to any Legal Requirements or to any Contract means same as exists as of the Execution Date and again as of the Closing Date.
9.18 Dispute Resolution.
(a) In the event of any dispute or disagreement between the Parties following the Closing as to the interpretation of any provision of this Agreement or the performance of any obligations hereunder the matter, upon the written request of any Party, shall be referred to representatives designated by each respective Party for resolution binding on the Parties. Such representatives shall promptly meet in a good faith effort to resolve the dispute. If the representatives do not agree upon a resolution within thirty (30) calendar days after reference of the matter to them, each Party shall be free to exercise the remedies available to it under the law.
(b) If any controversy, dispute or claim arising out or relating in any way to this Agreement or the transactions contemplated hereunder is not resolved by negotiation pursuant hereto, then either Party involved in such controversy, dispute or claim may demand that the controversy, dispute or claim be resolved by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect by three arbitrators selected in accordance with such rules unless the parties shall agree on a single arbitrator. The arbitrators shall reside or practice primarily in the County of Los Angeles, State of California The arbitration proceedings shall be held in Los Angeles County, Californiaor another mutually acceptable neutral venue.
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Each Party shall bear all of its own expenses and the arbitrators’ fees and expense shall be shared equally by the parties to the arbitration; provided, however, that at the conclusion of the arbitration, the arbitrator shall award costs and expenses (including the costs of the arbitration previously advanced and the fees and expenses of attorneys, accountants and other experts) to the prevailing Party or Parties. The decision of the arbitrators shall (i) be rendered in writing, and concurred in by a majority of the arbitrators, if more than one, and (ii) be final, binding and conclusive and entitled to be enforced to the fullest extent permitted by law and entered in any court of competent jurisdiction. To the extent practical, the decision of the arbitrators shall be rendered no more than thirty (30) days following commencement of proceedings with respect thereto. The arbitrators shall have the power to grant equitable relief. The arbitrators shall cause their written decision to be delivered to the Parties. The Parties consent to the jurisdiction of the foregoing arbitrator or arbitrators and further consent to the jurisdiction of any state or federal court located in the State of for the purpose of enforcing the decision or award of the arbitrators. The Parties agree that service of process may be made on any such Party by personal delivery or by registered or certified mail addressed to the appropriate Party at the address for such Party specified herein. The submission to the jurisdiction of the courts referred to above for the purpose of enforcing the decision or award of the arbitrators shall not (and shall not be construed so as to) limit the right of any Party to file or commence a proceeding against the other in any other court of competent jurisdiction for the purpose of enforcing the decision or award of the arbitrators if and to the extent permitted by applicable law. In the event any suit or other legal proceeding is brought for the enforcement of any decision or award of the arbitrators, the Parties agree that the prevailing Party or Parties shall be entitled to recover from the other Party or Parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal and costs incurred in bringing such suit or proceeding. Notwithstanding anything to the contrary, and without prejudice to the above procedures, any Party may apply to any court of competent jurisdiction for temporary injunctive or other provisional judicial relief if such action is necessary to avoid irreparable damage or to preserve the status quo until such time as the arbitrator is selected and available to hear such Party’s request for temporary relief.
9.19 Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state, local, or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. The word “including” shall mean including without limitation.
9.20 Incorporation of Exhibits and Schedules. Notwithstanding any provision of this Agreement to the contrary, Buyer and Seller acknowledge and agree that, with respect to any exhibit and/or schedule referenced in this Agreement but not completed and attached hereto as of the Execution Date, Buyer and Seller shall, in good faith negotiate the contents of such exhibit and/or schedule prior to the Closing Date.
[Signature pages to follow]
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