Exhibit 10.40
***Indicates material has been omitted pursuant to a
Confidential Treatment Request filed with the Securities and
Exchange Commission. A complete copy of this Agreement has been
filed with the Securities and Exchange Commission.
EQUITY INTEREST AND ASSET PURCHASE AND SALE AGREEMENT
among
WCA WASTE CORPORATION,
WCA
TEXAS MANAGEMENT GENERAL, INC.,
WCA
MANAGEMENT LIMITED, INC.
WCA
OF FLORIDA, LLC,
SOUTHWEST DUMPSTER, INC.,
WASTE SERVICES, INC.,
WASTE SERVICES OF FLORIDA, INC.,
WS
GENERAL PARTNER, LLC
and
WASTE SERVICES LIMITED PARTNER, LLC
June 29, 2007
EQUITY INTEREST AND ASSET PURCHASE AND SALE AGREEMENT
THIS EQUITY INTEREST AND ASSET
PURCHASE AND SALE AGREEMENT (this “Agreement”) is made
effective the 29 th day of June,
2007, among WCA Waste Corporation, a Delaware corporation
(“WCA Parent”), WCA Texas Management General, Inc., a
Delaware corporation (“WCT GP”), WCA Management
Limited, Inc., a Delaware corporation (“WCT LP”), WCA
of Florida, LLC, a Delaware limited liability company
(“WCF”), Southwest Dumpster, Inc., a Florida
corporation (“SW”), Waste Services, Inc., a Delaware
corporation (“WSI Parent”), Waste Services of Florida,
Inc., a Delaware corporation (“WSF”), WS General
Partner, LLC, a Texas limited liability company
(“WSGP”) and Waste Services Limited Partner, LLC, a
Delaware limited liability company (“WSLP”) (WCA
Parent, WCT GP, WCT LP, WCF and SW are collectively referred to as
the “WCA Parties;” and WSI Parent, WSF, WSGP and WSLP
are collectively referred to as the “WSI
Parties”).
WHEREAS, WSGP is the sole record and
beneficial owner of all of the issued and outstanding general
partner interests (the “GP Interests”) of each of
(a) Fort Bend Regional Landfill LP, a Texas limited
partnership (“Fort Bend Landfill”) that owns and
operates the Fort Bend Regional Landfill, a municipal solid waste
landfill (the “Landfill”); (b) Ruffino Hills
Transfer Station LP, a Texas limited partnership
(“Ruffino”) that operates a transfer station (the
“Transfer Station”) that it leases from the City of
Bellaire, Texas pursuant to a ground lease agreement dated October
11, 1999 (as amended, the “Ruffino Lease”); and
(c) WSI Waste Services of Texas, LP, a Texas limited
partnership (“WST”) that owns and operates a roll-off
hauling business (the “Hauling Business”) in the
Houston metropolitan area (the foregoing entities referred to
collectively as the “WSI Companies”); WSLP is the sole
record and beneficial owner of all of the issued and outstanding
limited partner interests (“LP Interests”) of each of
the WSI Companies; and the GP Interests and the LP Interests
together represent all of the authorized, issued and outstanding
equity interests (“Equity Interests”) of each of the
WSI Companies; and
WHEREAS, WSGP wishes to sell and WCT
GP wishes to buy all of the GP Interests in each of the WSI
Companies; and WSLP wishes to sell and WCT LP wishes to buy all of
the LP Interests in each of the WSI Companies; and
WHEREAS, WCF owns and operates a
materials recovery facility (the “MRF”) in Fort Myers,
Florida; WCF is the sole record and beneficial owner of all of the
issued and outstanding stock of SW, which owns and operates a
collection business (the “Collection Business”) in
Collier, Lee and Charlotte counties, Florida; and WCF wishes to
sell, and WSF wishes to purchase substantially all of the
businesses and assets of WCF owned and/or operating in Collier, Lee
and Charlotte counties, Florida (the “Ft. Myers
Assets”), including all issued and outstanding stock of
SW;
NOW, THEREFORE, in consideration of
the premises and of the mutual agreements set forth below, and for
other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereby agree as
follows, intending to be legally bound hereby:
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1. Transfer of Equity Interests and Transferred
Assets; Delivery of Other Assets and
Consideration»
1.1 Specified Interests
and Assets . Subject to the terms and conditions of this
Agreement, effective as of the Closing Date (as hereinafter
defined) the parties will take the following actions, and shall
transfer ownership of the Equity Interests and Transferred Assets
described herein, and shall further deliver the consideration
specified below and take the further actions required of them under
this Agreement:
(a) WSGP shall assign, convey,
transfer and deliver to WCT GP 100% of the GP Interests in each of
the WSI Companies.
(b) WSLP shall assign, convey,
transfer and deliver to WCT LP 100% of the LP Interests in each of
the WSI Companies.
(c) WCF shall assign, convey,
transfer and deliver to WSF substantially all of its assets located
in Collier, Lee and Charlotte counties, Florida (hereinafter, the
“Ft. Myers Assets”), all of the issued and outstanding
stock of SW (the “SW Shares”), and prior to the Closing
shall have conveyed to SW the rights and obligations of WCF in and
to that certain Closing and Stock Purchase Agreement among WCF,
William N. Veloz and SW, dated January 3, 2007 (the “SW
Agreement”) as more particularly described on the Schedules
attached hereto (the Ft. Myers Assets, the SW Shares and the SW
Agreement are collectively referred to herein as the
“Transferred Assets”).
(d) WCA Parent will deliver to WSI
Parent, on behalf of WSGP and WSLP, by wire transfer to an account
designated by such Parties, cash in the amount of $22,704,329.00,
representing in the aggregate an amount equal to (i) $23,700,000,
less (ii) all amounts currently on deposit with WSI Parent or
any of its affiliated parties pursuant to that certain Solid Waste
Disposal Agreement by and between Waste Corporation of Texas, L.P.
and Fort Bend Landfill dated March 23, 2005, plus the net
amount due from the WCA Parties to the WSI Parties pursuant to
Section 2.2.
(e) WSI Parent and WSF will make and
deliver to WCA Parent their joint and several promissory note (the
“Note”), which shall be secured by a first priority
purchase money security interest in the real estate being
transferred by WCF to the WSI Parties, which Note shall be paid in
equal monthly installments of $125,000 per month for eighty-four
(84) consecutive months, with the first payment thereof due on
August 1, 2007 and on the first day of each month
thereafter.
1.2 WSI Texas
Assets . It is the Parties’ understanding and
intent that all properties, assets and rights of every type
relating to facilities, operations or operating rights within the
State of Texas (collectively, the “WSI Texas Assets”)
are owned or leased by one or more of the WSI Companies; and by
virtue of Sections 1.1(a) and 1.1(b) above, all such WSI Texas
Assets shall remain in the WSI Companies, which shall from and
after the Closing Date be owned by WCT GP and WCT LP.
Notwithstanding the foregoing, in the event that any WSI Texas
Assets exist that are owned by any of the WSI Parties or their
Affiliates, the WSI Parties hereby jointly and severally convey,
transfer, assign, set over and deliver to WCT GP, and shall cause
their
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Affiliates to convey, transfer, assign, set over and deliver, the
WSI Texas Assets to WCT GP, without any further
consideration.
1.3 Transferred
Assets . It is the Parties’ understanding and intent
that all properties, assets and rights of every type relating to
facilities, operations or operating rights within the counties of
Collier, Lee and Charlotte, Florida (collectively, the “WCA
Florida Assets”) are owned by either SW or WCF; and by virtue
of Sections 1.1(c) and 1.1(d) above, all such WCA Florida
Assets shall remain in the aforementioned counties and after the
Closing Date be owned by WSF. Notwithstanding the foregoing, in the
event that any WCA Florida Assets exist that are owned by any of
the WCA Parties or their Affiliates, the WCA Parties hereby jointly
and severally convey, transfer, assign, set over and deliver to
WSF, and shall cause their Affiliates to convey, transfer, assign,
set over and deliver, the WCA Florida Assets to WSF, without any
further consideration.
1.4 Interests
and Assets Free and Clear of Liens . All of the Equity
Interests, Transferred Assets, the WSI Texas Assets and all other
properties and assets of all types to be conveyed or transferred
hereunder or owned by SW shall be delivered hereunder free and
clear of all liens and encumbrances, except for (a) those
encumbrances to title listed on Exhibits 1.4(a) (i) and
1.4(a)(ii); and (b) the first priority purchase money security
interest described in item 1.1(e) above.
2. Working Capital Adjustment»
2.1 Current
Liabilities .
Immediately prior to the Closing,
(a) the WSI Companies will assign and transfer to WSGP all of
the Current Liabilities of the WSI Companies, and (b) SW will
transfer to WCF all of the Current Liabilities of SW. In addition,
WCF will retain all of its Current Liabilities with respect to the
Ft. Myers Assets. To the extent that the consideration extended by
third parties to any party to this Agreement with respect to any
Current Liability is partially utilized prior to the Closing and
partially utilized after the Closing (a “Cross-Over
Liability”), then each of WSI Parent and WCA Parent will be
responsible for the pro rata share of such Current Liability
applicable to its pre-closing subsidiaries.
2.2 Trade Accounts
Receivable .
At Closing, (a) WCA Parent will
pay WSI Parent an amount equal to the Trade Accounts Receivable of
the WSI Companies as of the Closing Date, and (b) WSI Parent
will pay WCA Parent an amount equal to the Trade Accounts
Receivable of the Transferred Assets as of the Closing Date.
2.3
Reconciliation .
On each consecutive Friday
immediately following Closing, (a) WSI Parent will pay over to
WCA Parent all sums received by WSI Parent with respect to the WSI
Companies’ Trade Accounts Receivable, and (b) WCA Parent
will pay over to WSI Parent all sums received by WCA Parent with
respect to the Trade Accounts Receivable of the Transferred Assets.
Prior to August 31, 2007 WSI Parent will prepare a statement
reconciling each Parties’ pro rata share of
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the
Cross-Over Liabilities applicable to the WSI Companies and WCA
Parent will prepare a statement reconciling each Parties’ pro
rata share of the Cross-Over Liabilities applicable to the
Transferred Assets. Each of WCA Parent and WSI Parent will pay over
to the other an amount equal to its pro rata share of the
Cross-Over Liabilities. In addition, to the extent that any Trade
Account Payable purchased by a Party is determined to have been
improperly included as a Trade Account Payable, the transferor of
such Trade Account Payable shall reimburse the transferee for
amounts paid therefore.
3. Representations and Warranties of the WSI
Parties»
The WSI Parties make the following
representations and warranties jointly and severally, and represent
and warrant that all of the following representations and
warranties are true as of the date of this Agreement and shall be
true on the Closing Date:
3.1 Due
Organization .
(a) Each of the WSI Companies is a
limited partnership, duly formed, validly existing and in good
standing under the laws of its state of formation, and is duly
authorized, qualified and licensed under all applicable laws,
regulations, ordinances and orders of public authorities to carry
on its business in the places and in the manner as now conducted.
Copies of the Certificates of Limited Partnership (certified by the
Secretary of State of each such WSI Company’s state of
formation) and Agreement of Limited Partnership, each as amended,
of each such WSI Company are all attached hereto as Schedule
3.1(a) . The records and minutes books of each of the WSI
Companies, as heretofore made available to the WCA Parties, are
correct and complete, and will be delivered to the WCA Parties at
Closing.
(b) Each of WSGP and WSLP is a
limited liability company duly organized, validly existing and in
good standing under the laws of its state of organization, and is
duly authorized, qualified and licensed under all applicable laws,
regulations, ordinances and orders of public authorities to carry
on its business in the places and in the manner as now conducted or
as proposed to be conducted. Copies of the Articles of Organization
(certified by the Secretary of State of each of WSGP’s and
WSLP’s state of organization) and Operating Agreement
(certified by the Secretary of each of WSGP and WSLP), as amended,
of each of WSGP and WSLP, are attached hereto as
Schedule 3.1(b) . The records and minutes books of each
of WSGP and WSLP, as heretofore made available to the WCA Parties,
are correct and complete.
3.2 Authorization,
Validity and Effect of Agreements .
(a) This Agreement constitutes, and
all agreements and documents contemplated hereby when executed and
delivered pursuant hereto for value received will constitute, the
valid and legally binding obligations of the WSI Parties
enforceable in accordance with their terms, subject to
(i) applicable bankruptcy, insolvency or other similar laws
relating to creditor’s rights generally and (ii) general
principles of equity, regardless of whether considered in a
proceeding in equity or at law.
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(b) The execution and delivery of
this Agreement by the WSI Parties does not, and the consummation of
the transactions contemplated hereby by the WSI Parties will not
(i) except as set forth on Schedule 3.2 hereof,
require the consent, approval or authorization of, or declaration,
filing or registration with, any governmental or regulatory
authority or any third party; (ii) result in the breach of any
term or provision of, or constitute a default under, or result in
the acceleration of or entitle any party to accelerate (whether
after the giving of notice or the lapse of time or both) any
obligation under, or result in the creation or imposition of any
Lien upon any part of the property of the WSI Parties or any of the
WSI Companies pursuant to any provision of any order, judgment,
arbitration award, injunction, decree, indenture, mortgage, lease,
license, lien, or other agreement or instrument to which any the
WSI Parties or any WSI Company is a party or by which it is bound;
or (iii) violate or conflict with any provision of the
respective Certificates of Limited Partnership, Articles of
Organization, Agreements of Limited Partnership or Operating
Agreement, each as amended to the date hereof and as applicable, of
the WSI Parties.
3.3 Equity Interests of
the WSI Companies . All of the limited partnership
interests of the WSI Companies is shown on Schedule 3.3
. All of the limited partnership interests of the WSI Companies
have been duly authorized and validly issued, are fully paid and
nonassessable, are owned of record and beneficially by WSGP and
WSLP in the percentages set forth in Schedule 3.3 , and are
free and clear of all liens, encumbrances and claims of every kind.
All such limited partnership interests were offered, issued, sold
and delivered in compliance with all applicable state and federal
laws concerning the issuance of securities. Further, no such
limited partnership interests were issued in violation of the
preemptive rights of any past or present partner .
3.4 Obligations to
Issue or Sell Equity Interests . No right of first refusal,
option, warrant, call, conversion right or commitment of any kind
exists which obligates any WSI Company to issue any of its
authorized but unissued limited partnership interests or other
securities or equity interests. In addition, there are no
(a) outstanding securities or obligations which are
convertible into or exchangeable for any limited partnership
interests or other securities of any WSI Company, or
(b) contracts, arrangements or commitments, written or
otherwise, under which any WSI Company is or may become bound to
sell or otherwise issue any of its limited partnership interests or
other securities or equity interests. Without limiting the
generality of the foregoing, there is no valid basis upon which any
person (other than WSGP and WSLP) may claim to be in any way the
record or beneficial owner of, or to be entitled to acquire (of
record or beneficially), any limited partnership interest or other
security or equity interest of any WSI Company, and no person has
made or, to the WSI Parties’ knowledge, threatened to make
any such claim. In addition, no WSI Company has any obligation
(contingent or otherwise) to purchase, redeem or otherwise acquire
any of its limited partnership interests or other securities or
equity interests therein or to pay any dividend or make any
distribution in respect thereof.
3.5
Subsidiaries . No WSI Company (a) presently
owns, of record or beneficially, or controls, directly or
indirectly, any capital stock, securities convertible into capital
stock, membership interest, partnership interest, limited
partnership interest or any other equity interest in any
corporation, limited liability company, partnership, limited
partnership,
5
association or business entity; or (b) is, directly or
indirectly, a participant in any joint venture, partnership or
other non-corporate entity, save and except any joint venture
solely with another WSI Company.
3.6 Predecessor Status;
etc . Set forth on Schedule 3.6 is a list of
all of the names of all predecessors of each WSI Company, including
the names of any entities from whom each WSI Company previously
acquired significant assets or with whom each WSI Company merged.
Except as disclosed in Schedule 3.6 , no WSI Company
has ever been a subsidiary or division of another company nor been
a part of an acquisition which was later rescinded.
3.7 Financial
Statements .
(a) the WSI Parties have furnished to
the WCA Parties (and copies of which are attached hereto as
Schedule 3.7(a) ) the statements of operations of the
WSI Companies for the years ending December 31, 2004,
December 31, 2005 and December 31, 2006. The financial
statements referred to in this subsection are herein collectively
referred to as the “ WSI Financial Statements
.”
(b) the WSI Parties have furnished to
the WCA Parties (and copies of which are attached hereto as
Schedule 3.7(b) ) the statements of operations of the
WSI Companies for the period beginning January 1, 2007 and
ending May 31, 2007. The financial statements referred to in
this subsection are herein collectively referred to as the “
Interim WSI Financial Statements .”
(c) The Financial Statements and the
Interim Financial Statements, collectively, in all material
respects fairly set forth the financial condition of the WSI
Companies as of the dates indicated, and the results of its
operations for the periods indicated, and are in accordance with
generally accepted accounting principles consistently applied,
except as otherwise stated therein or in any attachment to
Schedules 3.7(a) and 3.7(b) attached hereto.
3.8 [Intentionally
Omitted] .
3.9 Approvals .
Except as set forth on Schedule 3.9 , no authorization,
consent or approval of, or registration or filing with, any
governmental authority or any other person is or was required to be
obtained or made by the WSI Parties or any WSI Company in
connection with the execution, delivery or performance of this
Agreement. All authorizations, consents and approvals set forth on
Schedule 3.9 have been obtained, and all registrations
and filings have been accomplished.
3.10 Accounts and Notes
Receivable . The WSI Parties have delivered to the WCA
Parties on Schedule 3.10 an accurate list of the WSI
Companies’ accounts and notes receivable as of June 27,
2007 and as of the Closing Date, including receivables from and
advances to their respective employees and to any other WSI Party
or an Affiliate thereof. The WSI Parties shall provide the WCA
Parties with an aging of all accounts and notes receivable showing
amounts due in 30-day aging categories for each WSI Company. To the
best knowledge of the WSI Parties, such accounts and notes of the
WSI Companies are collectible in the amounts shown on Schedule
3.10 .
6
3.11 Permits and
Intangibles .
(a) The WSI Parties have delivered to
the WCA Parties on Schedule 3.11(a) an accurate list
and summary description as of the Closing Date of all of the
certificates of need, permits, titles (including motor vehicle
titles and current registrations), fuel permits, licenses, orders,
approvals, franchises, certificates, trademarks, trade names,
patents, patent applications, copyrights and similar rights of
approvals owned or held by each WSI Company, all of which are now
valid, in good standing and in full force and effect.
(b) Except as set forth on
Schedule 3.11(b) , such permits, titles, fuel permits,
licenses, orders, approvals, franchises, certificates, trademarks,
trade names, patents, patent applications, copyrights and similar
rights of approvals are adequate for the operation of the WSI
Companies, as presently constituted.
(c) Except as set forth on
Schedule 3.11(c) , the WSI Parties have delivered to
the WCA Parties a description and copies as of the date of this
Agreement, of all of the WSI Companies’ material records,
reports, notifications, pending permit applications, engineering
studies, environmental impact studies filed or submitted or
required to be filed or submitted to governmental agencies, other
governmental approvals or applications for approval and of all
material notifications from such governmental agencies.
3.12 Personal Property,
Options and Leases . The WSI Parties have delivered to the
WCA Parties on Schedule 3.12 an accurate list and a
complete description as of the Closing Date of all of the personal
property, leases for equipment and real properties on which are
situated buildings, warehouses, workshops, garages and other
structures used by the WSI Companies, and any option to purchase
real property and including an indication as to which assets were
formerly owned by business or personal Affiliates of each WSI
Company. All leases set forth on Schedule 3.12 are in full
force and effect, constitute valid and binding agreements of the
parties (and their successors) thereto in accordance with their
respective terms, and do not require the assent of any party
thereto or any third party in order to remain in full force and
effect after the Closing. All assets used by the WSI Companies are
either owned by a WSI Company or leased under an agreement
indicated on Schedule 3.12 . Except as described on
Schedule 3.12 , there are no liens, mortgages, charges,
restrictions, pledges, security interests, options, leases, claims,
easements, encroachments or encumbrances on any property or assets
owned or used by any WSI Company.
3.13 Customers;
Contracts and Commitments .
(a) Schedule 3.13(a) sets
forth the names and addresses of all of the customers of the WSI
Companies as of the date hereof, and sets forth monthly billing
information related to such customers. None of the customers, to
the knowledge of the WSI Parties, intends to terminate or change
significantly, its relationship as presently existing, and the WSI
Parties have received no notice to such effect.
7
(b) Schedule 3.13(b) sets
forth a true and complete list of all of the WSI Companies’
contracts, agreements and other instruments and arrangements
(whether written or oral) (i) by which any WSI Company is
bound or affected or (ii) to which any WSI Company is a party
(the “ Contracts ”), including but not limited
to: (A) arrangements relating to providing solid waste
collection, transportation or disposal services to any person or
entity; (B) licenses, permits, insurance policies and other
arrangements concerning or relating to real estate;
(C) employment, consulting, collective bargaining or other
similar arrangements relating to or for the benefit of current,
future or former employees, agents, and independent contractors or
consultants; (D) agreements and instruments relating to the
borrowing of money or obtaining of or extension of credit, (E)
brokerage or finder’s agreements; (F) contracts
involving a sharing of profits or expenses; (G) acquisition or
divestiture agreements; (H) service or operating agreements,
manufacturer’s representative agreements or distributorship
agreements; (I) arrangements limiting or restraining any WSI
Company from engaging or competing in any lines of business or with
any person; (J) documents granting a power of attorney; and
(K) any other agreements or arrangements that are material to
the operation of the WSI Companies.
(c) Except as set forth on
Schedule 3.13(c) : (i) this Agreement will not
give rise to the right of any WSI Party to terminate or modify any
contract or agreement, (ii) no WSI Company is a party to any
contract, agreement or other instrument or commitment which, singly
or in the aggregate, materially and adversely affects such WSI
Company’s business, operations, properties, assets or
condition (financial or otherwise); and (iii) no WSI Company
is bound by or subject to (and none of their respective assets or
properties is bound by or subject to) any arrangement with any
labor union.
3.14 Real
Property . Except as set forth on Schedule 3.14
attached hereto:
(a) the WSI Companies own good and
marketable title to their respective real property described on
Schedule 3.14 (respectively, each “WSI
Company’s Real Property”), free and clear of any lien,
mortgage, charge, restriction, pledge, security interest, option,
lease, claim, easement, encroachment or encumbrance
(“Lien”), other than the Permitted Title Encumbrances,
and no person has an option to purchase all or any portion of such
real property;
(b) No WSI Company’s Real
Property is subject to any pending or threatened condemnation
Proceedings against all or part thereof;
(c) No WSI Company has ever granted
any person or entity a lease, sublease, license, concession, or
other right, written or oral, to use or occupy such WSI
Company’s Real Property, nor has any WSI Company ever entered
into an option, right of first refusal, or other agreement that
would permit any person or entity to purchase all or part of such
WSI Company’s Real Property; and
(d) No WSI Company has ever owned,
occupied, or conducted operations on any lands, other than that
respective WSI Company’s Real Property.
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3.15 Insurance
. The WSI Parties have delivered to the WCA Parties on Schedule
3.15 an accurate list of all of the insurance policies of the
WSI Companies, as well as an accurate list of: (a) all of
their respective insurance loss runs and worker’s
compensation claims received for the past three (3) policy
years; (b) all open claims; and (c) all known
circumstances reasonably likely to result in a claim. Such
insurance policies are currently in full force and effect and shall
remain in full force and effect through the Closing Date. None of
any WSI Company’s insurance has ever been canceled, and no
WSI Company has ever been denied coverage.
3.16 Employment
Matters . Schedule 3.16 contains a list of all
employees engaged to perform services for the WSI Companies,
including the annual compensation, hourly wages, daily rate of pay,
vacation, sick pay and other benefits for all such employees. The
WSI Companies have paid in full to all of their respective
employees all wages, salaries, commissions on jobs finished,
bonuses and other direct compensation for all services performed
(including accrued vacation) by them prior to the Closing and all
amounts required to be reimbursed to the employees, and the WCA
Parties will not, by reason of anything done prior to the Closing,
be liable to any employee for “severance pay” or any
other payment. The WSI Companies are in material compliance with
all federal, state, local and foreign laws and regulations
respecting employment and employment practices, terms and
conditions of employment and wages and hours.
3.17 Parachute
Provisions . The WSI Parties have delivered to the WCA
Parties on Schedule 3.17 an accurate schedule showing
all of the WSI Companies’ employment agreements and any other
agreements containing “parachute” provisions, and
deferred compensation agreements (which shall be considered
“liabilities” and assigned to WSGP pursuant to
Section 3.8), together with copies of such plans, agreements
and any trusts related thereto, and classifications of employees
covered thereby as of the Closing Date.
3.18 Benefit Plans;
ERISA Compliance .
(a) The WSI Parties are Affiliates of
Waste Services, Inc. The WSI Companies participate in, but do not
sponsor or maintain any “employee pension benefit
plans” (as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended (“
ERISA ”)) (sometimes referred to in this
Section 3.18 as “ Pension Plans ”),
“employee welfare benefit plans” (as defined in
Section 3(1) of ERISA) (sometimes referred to in this
Section 3.18 as “ Welfare Plans ”) or any
other Benefit Plans, as defined below.
(b) No WSI Company maintains any
Pension Plan or Benefit Plan intended to be a tax qualified plan
described Section 401(a) of the Code, and no such plan is or has
been subject to the minimum funding rules of Code Section 412
or ERISA Section 302, or the plan termination insurance
provisions of Title IV of ERISA.
(c) There are no voluntary employee
benefit associations maintained by any WSI Company and intended to
be exempt from federal income tax under Section 501(c)(9) of
the Code.
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(e) Neither the execution of this
Agreement nor the consummation of the transactions contemplated by
this Agreement will give rise to, or trigger, any change of
control, severance or other similar provisions in any Pension Plan,
Welfare Plan or Benefit Plan that will obligate the WSI Companies
to make such payment. The consummation of any transaction
contemplated by this Agreement will not result in any:
(i) payment (whether of severance pay or otherwise) becoming
due from the WSI Companies to any of their respective officers,
employees, former employees or directors or to the trustee under
any “rabbi trust” or similar arrangement;
(ii) benefit under any Benefit Plan applicable to the WSI
Companies being established or becoming accelerated, vested or
payable; or (iii) payment or series of payments by any WSI
Company, directly or indirectly, to any person that would
constitute a “parachute payment” within the meaning of
Section 280G of the Code.
(f) No WSI Company provides any
material post-retirement medical, health, disability or death
protection coverage or contribute to or maintain any employee
welfare benefit plan which provides for medical, health, disability
or death benefit coverage following termination of employment by
any officer, director or employee except as is required by
Section 4980B(f) of the Code or other applicable statute, nor
has any WSI Company made any representations, agreements, covenants
or commitments to provide that coverage.
(g) With respect to any Welfare Plan
applicable to the WSI Companies, (i) each such Welfare Plan
that is a group health plan, as such term is defined in
Section 5000(b)(1) of the Code, complies in all material
respects with any applicable requirements of Part 6 of Title I
of ERISA and Section 4980B(f) of the Code and (ii) each
such Welfare Plan (including any such plan covering retirees or
other former employees) may be amended or terminated with respect
to health benefits without material liability to any WSI Company on
or at any time after the Closing Date.
(h) All contributions by any WSI
Company required by law or by a collective bargaining or other
agreement to be made under any Pension Plan, Welfare Plan or
Benefit Plan with respect to all periods through the Closing Date,
including a pro rata share of contributions due for the current
plan year, will have been made by such date.
(i) No WSI Company has, nor will any
WSI Company have, any liability or obligation for taxes, penalties,
contributions, losses, claims, damages, judgments, settlement
costs, expenses, costs, or any other liability or liabilities of
any nature whatsoever arising out of or in any manner relating to
any Pension Plan, Welfare Plan or Benefit Plan (including but not
limited to employee benefit plans such as foreign plans which are
not subject to ERISA), that has been, or is, contributed to by any
entity, whether or not incorporated, which is deemed to be under
common control (as defined in Section 414 of the Code), with
any such WSI Company.
3.19 Conformity with
Law .
(a) Each WSI Company has complied in
all material respects with, and no WSI Company is in material
default under, any law, rule, ordinance, ruling, directive,
or
10
regulation or
any order, award, judgment or decree of any court or federal,
state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality having jurisdiction over
such WSI Company or any of their respective assets or businesses;
there are no claims, actions, suits or Proceedings, pending or
threatened, against or affecting any WSI Company, at law or in
equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality having jurisdiction over such WSI Company or their
respective businesses; and no notice of any claim, action, suit or
Proceeding, whether pending or threatened, has been received by any
WSI Company.
(b) The WSI Companies have conducted
and are conducting their respective operations in material
compliance with the requirements, standards, criteria and
conditions set forth in applicable federal, state and local
statutes, ordinances, permits, licenses, orders, approvals,
variances, rules and regulations, including, without limitation,
all such laws, rules, ordinances, decrees and orders relating to
intellectual property protection, transportation, wage and hour,
antitrust matters, consumer protection, currency exchange,
environmental protection, equal employment opportunity, health and
occupational safety, pension and employee benefit matters,
securities and investor protection matters, labor and employment
matters, and trading-with-the-enemy matters.
(c) No WSI Company has received any
notification of any asserted present or past unremedied failure by
it to comply with any of such laws, rules, ordinances, decrees or
orders.
3.20 Taxes
.
(a) Except as set forth on
Schedule 3.20 , each WSI Company has timely filed all
requisite federal and other Tax Returns for all fiscal periods
ended on or before the Closing Date; there are no open years,
examinations in progress or claims against any WSI Company for
federal and other Taxes (including penalties and interest) for any
period or periods prior to and including the Closing Date; and,
except as set forth on Schedule 3.20 , no notice of any
claim, whether pending or threatened, for Taxes has been received.
After the Closing, no WSI Company will be obligated or liable in
respect of any Tax pursuant to any Tax allocation or sharing
agreement (i.e., any agreement or arrangement for the payment of
Tax liabilities or payment for Tax benefits with respect to a
consolidated, combined or unitary Tax Return which includes any
such WSI Company) for periods ending prior to the Closing Date;
there are no requests for rulings in respect of any Tax pending by
any WSI Company with any tax authority; except as set forth on
Schedule 3.20 , no penalty or deficiency in respect of
any Taxes which has been assessed against any WSI Company remains
unpaid; and, except as set forth on Schedule 3.20 , all
Taxes (whether or not shown on any Tax Return) for all fiscal years
ending on or before the Closing Date will be paid in the normal
course of business by the WSI Parties.
(b) No WSI Company is a subchapter S
corporation within the meaning of sections 1361 and 1362 of the
Internal Revenue Code of 1986, as amended
(“Code”),
11
and no WSI
Company is, or owns any equity interests in, any “qualified
subchapter S subsidiary” within the meaning of sections
1361(b)(3)(B) and 1362 of the Code.
3.21
Completeness . The certified copies of the
Certificates of Limited Partnership and Agreement of Limited
Partnership, each as amended to date, of the WSI Companies and the
copies of all leases, instruments, agreements, licenses, permits,
certificates or other documents which are included on schedules
attached hereto or which have been delivered to the WCA Parties in
connection with the transactions contemplated hereby are complete
and correct; no WSI Company nor any other WSI Party hereto is in
material default thereunder; except as set forth in the schedules
and documents attached to this Agreement, the rights and benefits
of each WSI Company thereunder will not be adversely affected by
the transactions contemplated hereby; and the execution of this
Agreement and the performance of the obligations hereunder will not
violate or result in a breach or constitute a default under any of
the terms or provisions thereof.
3.22 Government
Contracts . Except as set forth on
Schedule 3.22 , no WSI Company is now, and none has
ever been, a party to any governmental contract subject to price
redetermination or renegotiation.
3.23 Absence of
Changes . Except as set forth in Schedule 3.23
, since May 31, 2007, there has not been:
(a) any material adverse change in
the financial condition, assets, liabilities (contingent or
otherwise), income or business of any WSI Company;
(b) any damage, destruction or loss
(whether or not covered by insurance), change in zoning, or change
in any law, rule, regulation, ordinance, or permit condition,
materially adversely affecting the properties or business of any
WSI Company;
(c) any change in the authorized or
outstanding limited partnership interests of any WSI Company or any
grant of any options, warrants, calls, conversion rights or
commitments;
(d) any declaration or payment of any
dividend or distribution in respect of the limited partnership
interests or any direct or indirect redemption, purchase or other
acquisition of any of the limited partnership interests of any WSI
Company;
(e) any bonus or any increase in the
compensation, sales commissions, fringe benefits or fee arrangement
payable or to become payable by any WSI Company to any of its
officers, directors, employees, consultants or agents or any change
in the method by which sales commissions are calculated and
paid;
(f) any work interruptions, labor
grievances or claims filed or, to any WSI Company’s
knowledge, any proposed law or regulation or any event or condition
of any character, materially adversely affecting the business or
future prospects of the WSI Companies;
12
(g) any sale or transfer, or any
agreement to sell or transfer, any assets, property or rights of
any WSI Company to any person;
(h) any cancellation, or agreement to
cancel, any indebtedness or other obligation owing to any WSI
Company;
(i) any plan, agreement or
arrangement granting any preferential rights to purchase or acquire
any interest in the assets, property or rights of any WSI Company
or requiring consent of any party to the transfer and assignment of
any such assets, property or rights;
(j) any purchase or acquisition, or
agreement, plan or arrangement to purchase or acquire, any
property, rights or assets of any WSI Company;
(k) any waiver of any material rights
or claims of any WSI Company;
(l) any breach, amendment or
termination of any material contract, agreement, license, permit or
other right to which any WSI Company is a party; or
(m) any transaction by any WSI
Company outside the ordinary course of its business.
3.24
Deposit Accounts; Powers of Attorney . Each WSI
Company has delivered to the WCA Parties on
Schedule 3.24 an accurate list as of the date of this
Agreement, of:
(a) the name of each financial
institution in which each such WSI Company has accounts or safe
deposit boxes;
(b) the names in which such accounts
or boxes are held;
(c) the type of accounts; and
(d) the name of each person
authorized to draw thereon or have access thereto.
(e) Schedule 3.24 also
sets forth the name of each person, corporation, firm or other
entity holding a general or special power of attorney from each
such WSI Company or any of its subsidiaries and a description of
the terms of such power. Each such power has been or will be
canceled on or before the Closing Date.
(f) Schedule 3.24 also
sets forth a list of all financial assurance instruments issued by
or on behalf of each WSI Company, including the names of the
surety, the obligee and the obligor for each such instrument, the
penal sum for each such instrument, the purpose of such instrument,
and the termination or renewal date of each such instrument.
3.25 Proprietary
Rights . Except as set forth on Schedule 3.25 ,
no WSI Company owns or has any right or interest in any
Intellectual Property, or any license or assignment with
13
respect
thereto. No WSI Company has granted to any third party a license or
other authorization to use any Intellectual Property of such WSI
Company (except to any other one or more of the WSI Companies), and
no third party owns any ownership interest in or holds any claim,
lien or other encumbrance, on any WSI Company’s Intellectual
Property. Neither any WSI Company nor the WSI Parties has received
any notification that any WSI Company has infringed upon or is
infringing upon, or has engaged in or is engaging in any
unauthorized use or misappropriation of, any Intellectual Property
owned by or belonging to any other person; and there is no pending
or threatened claim, and no basis for the assertion of any valid
claim, against any WSI Company with respect to any such
infringement, unauthorized use or misappropriation. Except for
software used in connection with the operation of the WSI
Companies, no WSI Company has entered into any licensing agreements
to use the Intellectual Property of third parties, and no WSI
Company owes to any third parties royalties for the use of
Intellectual Property.
3.26 Validity of
Obligations . The execution and delivery of this Agreement
by each WSI Company and the performance of the transactions
contemplated herein have been duly and validly authorized by the
partners of each WSI Company, and this Agreement has been duly and
validly authorized by all necessary limited partnership action and
is a legal, valid and binding obligation of each WSI Company and
the WSI Parties.
3.27 Relations with
Governments . Neither any WSI Company, nor any shareholder,
member, manager, director, officer, agent, employee or other person
acting on behalf of any WSI Company, has used any funds of any WSI
Company for improper or unlawful contributions, payments, gifts or
entertainment, or made any improper or unlawful expenditures
relating to political activity to domestic or foreign government
officials or others. Each WSI Company has adequate financial
controls to prevent such improper or unlawful contributions,
payments, gifts, entertainment or expenditures. Neither any WSI
Company, nor any partner, shareholder, member, manager, director,
officer, agent, employee or other person acting on behalf of any
WSI Company, has accepted or received any improper or unlawful
contributions, payments, gifts or expenditures. The WSI Companies
have at all times complied, and are in compliance, in all material
respects, with the Foreign Corrupt Practices Act and in all
material respects with all foreign laws and regulations relating to
prevention of corrupt practices.
3.28 Environmental
Matters . The WSI Companies and the WSI Parties have
delivered to the WCA Parties all of the correspondence, agreements,
notices or other documents related to the items set forth on
Schedule 3.28 .
Except as set forth in
Schedule 3.28 :
(a) the WSI Companies and all
property (whether real or personal) which is or was formerly
leased, used, operated, owned or managed in whole or in part in any
manner by any WSI Company or any of its organizational predecessors
(individually, any “Business Facility”, and
collectively, the “Business Facilities”) and all
operations of the WSI Companies and their respective Business
Facilities, are in material compliance and have been in material
compliance with all applicable Environmental Laws;
14
(b) each WSI Company and its Business
Facilities has obtained and is in material compliance with all
permits, licenses, registrations, approvals and other
authorizations (including all applications for all of the
foregoing) required under any Environmental Law for the business of
such WSI Company as currently conducted (collectively,
“Environmental Permits”), and Schedule 3.28
contains an accurate and complete listing of all of the Business
Facilities and all of the Environmental Permits of each WSI
Company;
(c) there is no past or present
event, condition or circumstance that may interfere with the
conduct of any WSI Company’s business in the manner now
conducted relating to such WSI Company’s compliance with
Environmental Laws or which constitutes a material violation
thereof, or which could have a material adverse effect upon such
WSI Company’s business or financial condition;
(d) during the term of each WSI
Company’s ownership of or control of its Business Facilities
(“Ownership Term”), each WSI Company and its respective
Business Facilities, and any operations thereon, have not been and
are not currently subject to an Environmental Claim;
(e) there are no Environmental Claims
or investigations pending or threatened, involving the release or
threat of release of any Polluting Substances from or on
(i) any Business Facility of any WSI Company, or (ii) any
other property where Polluting Substances generated by any WSI
Company or originating from any Business Facility of any WSI
Company have been recycled, stored, treated, released or disposed,
or (iii) any property to which Polluting Substances were
transported by any WSI Company or (iv) any property on which
any WSI Company performs or performed or may be required to perform
Remediation;
(f) there are no Polluting Substances
on any Business Facility of any WSI Company in an amount or
concentration which would require reporting to any governmental
authority or Remediation to comply with the requirements of
Environmental Laws and which have not been so reported;
(g) no WSI Company has undertaken
Remediation or other decontamination or cleanup of any facility or
site or entered into any agreement or extended any offer for the
payment of costs associated with such activity;
(h) each WSI Company has filed all
notices, notifications, financial assurance, applications and all
similar documents which are required to be obtained or filed for
the operation of its business or the use or operation of any of its
Business Facilities and has not received any notification that such
filings are incomplete or insufficient;
(i) there are no Environmental Claims
for which any WSI Company has failed to notify its insurers within
contractually required notice periods or for which insurers have
denied coverage or reserved their rights to deny coverage;
(j) there are no false or misleading
statements in any current or prior Environmental Permit relating to
any WSI Company or any of its Business Facilities;
15
(k) the transactions contemplated by
this Agreement will not require the amendment or transfer of any of
the Environmental Permits;
(l) no WSI Company is now, and to the
best of the WSI Companies’ and the WSI Parties’
knowledge, no WSI Company will be in the future (based solely upon
the Environmental Laws as they exist on the Closing Date), as a
result of the operation or condition of any Business Facility of
any WSI Company or the businesses thereon as conducted prior to or
at Closing, subject to any: (i) contingent liability in
connection with any release or threatened release of Polluting
Substances into the environment other than the normal or routine
disposal of solid waste, whether on or off the Properties or any
Business Facility of any WSI Company; (ii) reclamation,
decontamination or Remediation requirements under Environmental
Laws, or any reporting requirements related thereto, except for
ordinary closure requirements under Environmental Laws; or
(iii) consent order, compliance order or administrative order
relating to or issued under any Environmental Law;
(m) there are no obligations,
undertakings or liabilities arising out of or relating to
Environmental Laws which any WSI Company has agreed to, assumed or
retained, by contract or otherwise, except as referenced in the
Environmental Permits;
(n) there are no, nor to any WSI
Company’s or the WSI Parties’ respective knowledge,
have there ever been any, storage tanks on or under any Business
Facility of any WSI Company, and all Business Facilities of the WSI
Companies containing such tanks during the Ownership Term has been
remediated in compliance with all Environmental Laws; and
(o) to the knowledge of the WSI
Parties:
(i) no drinking water intakes or
water wells exist within a two-mile radius of any Business Facility
of any WSI Company, which could have an adverse affect on the
Environmental Permits or any other governmental
authorization;
(ii) there are no polychlorinated
biphenyls on or in the Properties or any Business Facility of any
WSI Company or any equipment or fixtures thereon; and
(iii) there are no airports, flood
plains, wetlands, fault areas or seismic impact zones on or near
any property of any WSI Company which could have a material effect
on the Environmental Permits, any governmental authorization or the
assets of any WSI Company.
3.29 No Broker’s
or Finder’s Fees . No agent, broker, investment
banker, person or firm has acted directly or indirectly on behalf
of the WSI Parties or any WSI Company in connection with this
Agreement or the transactions contemplated herein who will be
entitled to any broker’s or finder’s fee or any other
commission or similar fee or expense, directly or indirectly, in
connection with this Agreement or the transactions contemplated
herein.
16
3.30 Litigation
. Except as set forth in Schedule 3.30 , there are no
Proceedings pending or, to the knowledge of the WSI Parties or any
WSI Company, threatened against any WSI Company, or challenging the
validity or propriety of the transactions contemplated by this
Agreement or any Environmental Permit or other permit or
governmental authorization; to the knowledge of the WSI Parties and
the WSI Companies, there is no basis or ground for any such
Proceedings; and there is no outstanding order, writ, injunction or
decree of any court, administrative agency, governmental body or
arbitration tribunal against any WSI Company or the WSI Parties or
their respective assets, which relates to or could have an effect
on any WSI Company. Set forth on Schedule 3.30 are all
Proceedings during the last five years to which any WSI Company was
a party, or which, to the knowledge of the WSI Parties or the WSI
Companies, were threatened against any WSI Company, or which relate
in any manner to the assets of any WSI Company.
3.31 Disclosure
. To the knowledge of the WSI Parties, this Agreement and the
schedules hereto and all other documents and information furnished
to the WCA Parties and its representatives pursuant hereto do not
and will not include any untrue statement of a material fact or
omit to state a material fact necessary to make the statements
herein and therein not misleading. If prior to Closing, the WSI
Parties become aware of any fact or circumstance which would change
a representation or warranty of the WSI Parties in this Agreement
or any representation made on behalf of the WSI Parties or the WSI
Companies, the WSI Parties shall immediately give notice of such
fact or circumstance to the WCA Parties. Such notification shall
not relieve the WSI Parties of their obligations under this
Agreement.
4. Representations and Warranties of the WCA
Parties»
The WCA Parties make the following
representations and warranties jointly and severally, and represent
and warrant that all of the following representations and
warranties are true as of the date of this Agreement and shall be
true on the Closing Date:
4.1 Due
Organization .
(a) SW is a corporation, duly formed,
validly existing and in good standing under the laws of its state
of formation, and is duly authorized, qualified and licensed under
all applicable laws, regulations, ordinances and orders of public
authorities to carry on its business in the places and in the
manner as now conducted. Copies of the Articles of Incorporation
(certified by the Secretary of State of SW’s state of
incorporation) and Bylaws, each as amended, of SW are attached
hereto as Schedule 4.1(a) . The records and minutes books of
SW, as heretofore made available to the WCA Parties, are
reconstructed and are, therefore, incomplete, and will be delivered
to the WSI Parties at Closing.
(b) WCF is a limited liability
company duly organized, validly existing and in good standing under
the laws of its state of organization, and is duly authorized,
qualified and licensed under all applicable laws, regulations,
ordinances and orders of public authorities to carry on its
business in the places and in the manner as now conducted or as
proposed to be conducted. Copies of the Articles of Organization
(certified by the Secretary of State of WCF’s state of
organization) and Operating
17
Agreement
(certified by the Secretary of WCF), as amended, of WCF are
attached hereto as Schedule 4.1(b) . The records and
minutes books of WCF, as heretofore made available to the WSI
Parties, are correct and complete, and will be delivered to the WSI
Parties at Closing.
4.2 Authorization,
Validity and Effect of Agreements .
(a) This Agreement constitutes, and
all agreements and documents contemplated hereby when executed and
delivered pursuant hereto for value received will constitute, the
valid and legally binding obligations of the WCA Parties
enforceable in accordance with their terms, subject to
(i) applicable bankruptcy, insolvency or other similar laws
relating to creditor’s rights generally and (ii) general
principles of equity, regardless of whether considered in a
proceeding in equity or at law.
(b) The execution and delivery of
this Agreement by the WCA Parties does not, and the consummation of
the transactions contemplated hereby by the WCA Parties will not
(i) except as set forth on Schedule 4.2 hereof,
require the consent, approval or authorization of, or declaration,
filing or registration with, any governmental or regulatory
authority or any third party; (ii) result in the breach of any
term or provision of, or constitute a default under, or result in
the acceleration of or entitle any party to accelerate (whether
after the giving of notice or the lapse of time or both) any
obligation under, or, except for the first lien purchase-money
security interest in the assets being delivered by WCF, result in
the creation or imposition of any Lien upon any part of the
property of the WCA Parties or SW pursuant to any provision of any
order, judgment, arbitration award, injunction, decree, indenture,
mortgage, lease, license, lien, or other agreement or instrument to
which any the WCA Parties or SW is a party or by which it is bound;
or (iii) violate or conflict with any provision of the respective
Certificates of Limited Partnership, Articles of Organization,
Agreements of Limited Partnership, Operating Agreement, Articles of
Incorporation or Bylaws, each as amended to the date hereof and as
applicable, of the WCA Parties.
4.3 Equity Interests of
SW . All of the issued and outstanding shares of the
capital stock of SW (the “Shares”) are shown on
Schedule 4.3. All of the Shares have been duly
authorized and validly issued, are fully paid and nonassessable,
are owned of record and beneficially by WCF, and are free and clear
of all liens, encumbrances and claims of every kind. All such
Shares were offered, issued, sold and delivered in compliance with
all applicable state and federal laws concerning the issuance of
securities. Further, no such Shares were issued in violation of the
preemptive rights of any past or present Shareholder .
4.4 Obligations to
Issue or Sell Equity Interests . No right of first refusal,
option, warrant, call, conversion right or commitment of any kind
exists which obligates SW to issue any of its Shares or other
securities or equity interests therein. In addition, there are no
(a) outstanding securities or obligations which are convertible
into or exchangeable for any Shares or other securities of SW, or
(b) contracts, arrangements or commitments, written or
otherwise, under which SW is or may become bound to sell or
otherwise issue any of its Shares or other securities or equity
interests. Without limiting the generality of the foregoing, there
is no valid basis upon which any person (other than WCF) may claim
to be in any way the record or
18
beneficial owner of, or to be entitled to acquire (of record or
beneficially), any Shares or other security or equity interest of
SW, and no person has made or, to the WCA Parties’ knowledge,
threatened to make any such claim. In addition, SW does not have
any obligation (contingent or otherwise) to purchase, redeem or
otherwise acquire any of its Shares or other securities or equity
interests therein or to pay any dividend or make any distribution
in respect thereof.
4.5
Subsidiaries . Except as set forth on
Schedule 4.5 , SW (a) does not presently own, of
record or beneficially, or control, directly or indirectly, any
capital stock, securities convertible into capital stock,
membership interest, partnership interest, limited partnership
interest or any other equity interest in any corporation, limited
liability company, partnership, limited partnership, association or
business entity; and (b) is not directly or indirectly, a
participant in any joint venture, partnership or other
non-corporate entity, save and except any joint venture solely with
WCF and its Affiliates (which such joint ventures shall terminate
upon the Closing).
4.6 Predecessor Status;
etc . Set forth on Schedule 4.6 is a list of
all of the names of all predecessors of SW, including the names of
any entities from whom SW previously acquired significant assets or
with whom SW merged. Except as disclosed in
Schedule 4.6 , SW has never been a subsidiary or
division of another company nor been a part of an acquisition which
was later rescinded.
4.7 Financial
Statements .
(a) the WCA Parties have furnished to
the WSI Parties (and copies of which are attached hereto as
Schedule 4.7(a) ) the statements of operations of the
Ft. Myers Assets for the years ending December 31, 2004,
December 31, 2005 and December 31, 2006. The financial
statements referred to in this subsection are herein collectively
referred to as the “ WCF Financial Statements
.”
(b) the WCA Parties have furnished to
the WSI Parties (and copies of which are attached hereto as
Schedule 4.7(b)): (i) SW’s U.S. Income Tax
returns with respect to the Business as of December 31, 2004,
December 31, 2005 and December 31, 2006. The tax returns
referred to in this subsection are herein collectively referred to
as the “SW Financial Statements .”
(c) the WCA Parties have furnished to
the WSI Parties (and copies of which are attached hereto as
Schedule 4.7(c) ) the statements of operations of SW
and the Ft. Myers Assets for the period beginning January 1,
2007 and ending May 31, 2007. The financial statements
referred to in this subsection are herein collectively referred to
as the “ Interim WCF Financial Statements
.”
(d) The WCF Financial Statements and
the Interim WCF Financial Statements, collectively, in all material
respects fairly set forth the financial condition of the Ft Myers
Assets (inclusive of SW with respect to the Interim WCF Financial
Statements), taken as a whole, as of the dates indicated, and the
results of its operations for the periods indicated, and are in
accordance with generally accepted accounting
19
principles
consistently applied, except as otherwise stated therein or in any
attachment to Schedules 4.7(a) and 4.7(c) attached
hereto.
(e) To the knowledge of the WCA
Parties, the SW Financial Statements fully and fairly set forth the
financial condition of SW as of the dates indicated, and the
results of its operations for the periods indicated, and are in
acc
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