ASSET PURCHASE AGREEMENT

EXHIBIT 10.1   

 ASSET PURCHASE AGREEMENT

(Joseph Uras Monuments)

    ASSET PURCHASE AGREEMENT made and executed this 29th day of December, 2005, by and among Rock of Ages Memorials, Inc.., a Delaware corporation, with a principal office located at 772 Graniteville Road, Graniteville, Vermont 05641 (the "Seller"); Joseph Uras Monuments, Inc.., a New Jersey corporation; and 601 Route 35 LLC, a New Jersey limited liability company (collectively "Buyer").

RECITALS:

    Seller owns all of the assets and business of Rock of Ages Memorials, Inc., d/b/a Joseph Uras Monuments, with business locations at Middletown, Manalapan, and Toms River, New Jersey; and Rock of Ages Memorials, Inc., d/b/a Clinton Monuments, with a business location in Jamesburg, New Jersey (collectively, the "Business"). The Buyer desires to purchase and assume, and the Seller desires to sell and assign, certain real property, assets and liabilities of the Seller upon the terms and subject to the conditions of this agreement.

    NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein, the parties hereby agree as follows:

ARTICLE I

PURCHASE AND SALE OF ASSETS AND
ASSUMPTION OF LIABILITIES

    1.1    Purchase of Assets.    Subject to the terms and conditions of this agreement, the Seller agrees to sell, assign, transfer, convey, and deliver to the Buyer on the Closing Date (as hereinafter defined), and the Buyer agrees to purchase from the Seller on the Closing Date, the assets and properties of the Business listed on Exhibit 1.1; provided that the Assets will not include the items of real and/or personal property identified as "Excluded Assets" on Exhibit 1.1 (collectively referred to as the "Excluded Assets").

    1.2    Purchase of Middletown Realty.    Subject to the terms and conditions of this agreement, Seller agrees to sell, assign, transfer, convey and deliver to 601 Route 35 LLC on the Closing Date, and 601 Route 35 LLC agrees to purchase from Seller on the Closing Date, all of Seller's right, title and interest in and to the real property located at 601 Route 35, Middletown, New Jersey (the "Middletown Realty").

    1.3    Liabilities and Obligations Assumed.    Buyer shall assume those liabilities, obligations and undertakings of Seller identified on Exhibit 1.3 (said liabilities identified on Exhibit 1.3 being collectively referred to as the "Assumed Liabilities"), and those liabilities that may have been incurred by Seller in the ordinary course of the operation of the Businesses. Seller hereby agrees to indemnify and hold Buyer harmless from and against all costs, claims, actions, debts, liabilities, obligations and undertakings of Seller except for the Assumed Liabilities and those liabilities incurred in the ordinary course of business, if any.

    1.4    Bulk Sales.    Buyer and Seller each hereby waive compliance by the other with any applicable provisions of the bulk sales laws of the State of New Jersey or any other applicable jurisdiction, and Seller agrees to indemnify and hold Buyer harmless from any loss, cost or damage, including without limitation reasonable attorneys fees and payments to any of Sellers' creditors, incurred by Buyer because of Sellers' or Buyer's noncompliance with said bulk sales laws.

    1.5    Closing.    The closing of the purchase and sale hereunder (the "Closing") shall take place at the offices of Martin J. Arbus, Esq. at 10:00 a.m. local time, on December 29, 2005 in accordance with the provisions of Article VI hereof after all of the conditions set forth in this agreement shall be fulfilled or waived in accordance with this agreement and applicable law, or at such other time, date and/or place as the parties may agree. The date and time at which the Closing actually occurs is referred to as the "Closing Date".

    1.6    Determination of and Allocation of the Purchase Price.

            (a)    The aggregate purchase price for the Assets (the "Purchase Price") shall be Eight Hundred Fifty Thousand Dollars ($850,000.00) (the "Cash Purchase Price"), as adjusted at the Closing Date in accordance with Exhibit 1.6(a) attached hereto.

            (b)    The parties agree to report the transactions contemplated by this agreement and to allocate the Purchase Price, for tax and accounting purposes in accordance with the allocations set forth on Exhibit 1.6(b), pursuant to Section 1060 of the Code, as amended, and the permanent and temporary Treasury Regulations thereunder.

    1.7    Payment of Purchase Price and Delivery of Title to the Realty and Assets.    Upon the terms and subject to the conditions of this agreement, at the Closing:

            (a)    Buyer shall deliver to Sellers on the Closing Date by Buyer's certified check, its counsel's trust account check, or by wire transfer pursuant to specific wire transfer instructions provided to Buyer at least five (5) days prior to the Closing Date, the amount of the Cash Purchase Price pursuant to Section 1.6(a), and shall pay or assume or otherwise satisfy the Assumed Liabilities (if any) pursuant to Section 1.6, by check or other mutually acceptable means on the Closing Date, subject to any withholdings or reserves from the Purchase Price as provided for in this agreement and any Exhibits hereto.

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            (b)    The Seller shall deliver to Buyer (i) bills of sale and assignment and all other necessary instruments to transfer title to the Assets and Assumed Liabilities; (ii) the agreements listed in Article II; (iii) a special warranty deed conveying insurable and marketable title to the Middletown Realty, free and clear of all liens and encumbrances, except for permitted encumbrances revealed by the title search; and (v) funds for the payment of any taxes, if any, in respect to the sale, to the extent Buyer has any liability for the collection thereof, to which the transactions contemplated hereby may be subject under the laws of the State of New Jersey.

            (c)    Transfer taxes associated with the sale, assignment, transfer and conveyance of the Middletown Realty set forth in paragraph 1.2 herein shall be paid by the Seller.

            (d)    State Sales tax associated with the sale and transfer of vehicles and /or equipment pursuant to the terms of this agreement shall be the sole responsibility of Buyer.

            (e)    Buyer agrees to provide a satisfactory mechanism for the segregation and handling of all monies, refunds or account receivables sent to Buyer and owed to Seller, and to prompt remit same to Seller.

ARTICLE II

FURTHER AGREEMENTS

    2.1    Authorized Retailer Agreement.  At the Closing, the Seller and Buyer shall execute an Authorized Retailer Agreement substantially in the form attached hereto as Exhibit 2.1.

    2.2    Termination of Employment Agreement. At the Closing, the Employment Agreement dated as of January 1, 2003 between Seller and Joseph Uras shall terminate and be of no further force and effect and Seller and Joseph Uras shall be released from their respective obligations thereunder.

    2.3    Seller hereby agrees that, for a period of five (5) years from the date hereof, it will not authorize any retailer, or open a new Rock of Ages owned retail outlet within a ten (10) mile radius of Buyer's retail locations in Middletown, Manalapan, Jamesburg and Toms River, New Jersey.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

    3.1    General Statement.    The parties make the representations and warranties set forth in this Article III. All representations and warranties of the parties are made subject to the exceptions, if any, which are noted in the respective Exhibits and Schedules delivered by the parties to each other and accepted by the receiving party concurrently herewith or in accordance with Section 6.11.

    3.2    Representations and Warranties of the Buyer.    Buyer makes the following representations and warranties to the Sellers, in each case with the intention that they may rely upon the same, and covenants that the same are true and correct in all material respects on the Closing Date.

            (a)    Organization and Qualification.    Buyer is a New Jersey corporation, duly incorporated, validly existing and in good standing under the laws of the State of New Jersey; has all requisite corporate power and authority to own and lease its properties and to carry on the business in which it is presently engaged; and is duly qualified and in good standing to do business in each jurisdiction in which the nature of the business conducted by it or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified will not have, individually or in the aggregate with any other failure to be so qualified, a material adverse effect on Buyer.

            601 Route 35 LLC is a New Jersey limited liability company, duly formed, validly existing and in good standing under the laws of the State of New Jersey; has all requisite power and authority to own and lease its properties and to carry on the business in which it is presently engaged; and is duly qualified and in good standing to do business in each jurisdiction in which the nature of the business conducted by it or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified will not have, individually or in the aggregate with any other failure to be so qualified, a material adverse effect on 601 Route 35 LLC.

            (b)    Authority.    Buyer has the requisite corporate power and authority to execute and deliver this agreement and the related agreements referred to herein, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this agreement by Buyer and the consummation by Buyer of the transactions contemplated hereby have been (or will have been by the Closing Date) duly authorized by all necessary corporate action and no other corporate proceedings on the part of Buyer are necessary to authorize this agreement or to consummate the transactions contemplated hereby (which Buyer shall cause to be obtained prior to Closing). This agreement has been duly executed and delivered by Buyer and, assuming the due authorization, execution and delivery by the other parties hereto, constitutes the legal, valid and binding obligation of Buyer, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors' rights generally, and to general equitable principles.

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            (c)    No Conflict and Consents.    The execution and delivery of this agreement by Buyer does not, and the performance of this agreement by Buyer will not, (i) conflict with or violate the Articles of Incorporation or Bylaws of Buyer ; (ii) conflict with or violate any Laws applicable to Buyer or any of Buyer's Subsidiaries or by which any of their respective properties is bound or affected; or (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a lien or encumbrance on any of the properties or assets of Buyer or any of Buyer's Subsidiaries pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other material instrument or obligation to which Buyer or any of Buyer's Subsidiaries is a party or by which Buyer or any of Buyer's Subsidiaries or any of their respective properties is bound or affected, except for any such conflict or violations described in clause (ii) or breaches or defaults described in clause (iii) that would not have a Buyer Material Adverse Effect.

            (d)    Broker.    No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this agreement based upon arrangements made by or on behalf of Buyer.

            (e)    Sole Representations and Warranties.    The representations and warranties contained in this Section 4.2 and in the Schedules and Exhibits attached hereto and in any closing certificate delivered in connection herewith, are the only representations and warranties made by Buyer in connection with the transactions contemplated by this agreement.

    3.3    Representations and Warranties of Seller.    Seller makes the following representations and warranties to Buyer with the intention that it may rely upon the same, and covenant that the same are true and correct and shall be true and correct at the Closing Date:

            (a)    Organization and Qualification.    Seller is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware, has all requisite corporate power and authority to own and lease its properties and to carry on the Business, and is duly qualified and in good standing to do business in the State of New Jersey.

            (b)    Authority.    Seller has the requisite corporate power and authority to execute and deliver this agreement and the related agreements referred to herein, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this agreement by Seller and the consummation by Seller of the transactions contemplated hereby have been duly authorized by all necessary corporate action, and no other corporate proceedings on the part of each of the Seller is necessary to authorize this agreement or to consummate the transactions contemplated hereby. This agreement has been duly executed and delivered by the Seller and, assuming the due authorization, execution and delivery by the other parties hereto, constitutes the legal, valid and binding obligations of them respectively, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors' rights generally, and to general equitable principles.

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            (c)    No Conflict and Consents.    The execution and delivery of this agreement by Seller does not, and the performance of this agreement by Seller will not, (i) conflict with or violate the Articles of Incorporation, Bylaws, or other formation or governing documents of Seller; (ii) conflict with or violate any Laws applicable to Seller or by which any of its properties is bound or affected; or (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a lien or encumbrance on any of the properties or assets of Seller, or upon the Middletown Realty pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other material instrument or obligation to which Seller is a party or by which Seller or any of its properties is bound or affected, except for any such conflict or violations described in clause (ii) or breaches or defaults described in clause (iii) that would not have a Seller Material Adverse Effect.

            (d)    No Liens, etc.- Litigation.    To the best of Seller's knowledge, information and belief, Seller has not taken any action which would encumber the assets to be purchased and is not aware of any pending litigation affecting the Business.

            (d)     Sole Representations and Warranties.    The representations and warranties contained in this Section 3.3 and in the Schedules and Exhibits attached hereto and in any closing certificate delivered in connection herewith, are the only representations and warranties made by Seller in connection with the transactions contemplated by this agreement.

ARTICLE IV

COVENANTS AND AGREEMENTS

    4.1    Seller's Employees.    All employees of Seller shall be employees of the Seller up to and through the Closing Date. Seller shall be responsible for and shall pay all salaries, wages, expenses, workers' compensation benefits and other fringe benefits and obligations due and payable to its employees through the Closing Date. Notwithstanding the foregoing, Buyer shall be responsible for paying any employee bonuses due in respect of 2005 performance, and Seller shall have no liability for the same.

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    4.2    Indemnification and Reimbursement.    Seller will indemnify and hold harmless Buyer, and will reimburse Buyer for any loss, liability, claim, damage or expense arising from or in connection with any liability arising out of the ownership or operation of the Business prior to the Closing Date, other than the Assumed Liabilities. Likewise, Buyer will indemnify and hold harmless Seller, and will reimburse Seller for any loss, liability, claim, damage or expense arising from or in connection with any liability arising out of the ownership or operation of the Business on or after the Closing Date and any Assumed Liabilities.

    4.3    Confidential Information.    In performing their respective obligations under this agreement, each of the parties may have access to and receive disclosure of certain confidential information about the other parties (including the Parent and its Subsidiaries), including, but not limited to, financial information, operating procedures, marketing plan objectives, books, contracts, eq