Preview
FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023
NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023
EXHIBIT 2
FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023
NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023
ASSFT PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement"), dated as of , is entered
Group"
into by and between Property Analytix, LLC, DBA "Archstone and Archstone
Group NYC LLC, (collectively, "Buyer") and RD Geronimo, Ltd. ("Seller"), a New York
Corporation, and Richard J. DiGeronimo ("RJD") based on the following recitals, terms
and conditions.
RECITALS
R. D. Geronimo a New York located at 158 3rd
WHEREAS, LTD, Corporation, St.,
Mineola, NY 11501, is a real estate appraisal business (the "Business"); and
WHEREAS, RJD is the sole owner of 100% of the stock of the Business; and
WHEREAS, Seller is the sole owner of various pieces of equipment, products,
inventory, and other assets used in connection with the Business; and
WHEREAS, Buyer desires to purchase and Seller desires to sell the Business and all
of its tangible-and-intangible assets-(except as set forth-he-rein) utilized in-relation to the
Business, all of which is the property of Seller, upon the terms and conditions set forth in
this Agreement; and
NOW, THEREFORE, in consideration of the foregoing recitals and the terms and
conditions set forth below, the parties hereby agree as follows:
1 Purchase and Sale
1.1 Agreement to Sell and Purchase Purchased Assets. Subject to the terms and
conditions of this Agreement, and in reliance on the representations, warranties and
covenants set forth in this Agreement, Seller agrees to sell, assign, transfer and convey to
Buyer at the Closing, and Buyer agrees to purchase and acquire from Seller at the Closing,
all of Seller's right, title and interest in and to the Business and all of the Purchased Assets
(as defined in Section 1.2 below), free and clear of all liens, claims, encumbrances and
interests of record, or of which Seller has knowledge after a reasonable inquiry.
Assets"
1.2 Assets to be Sold. The "Purchased specifically include, but are not
limited to, the following:
1.2.1 The goodwill of Seller, including the name R.D. Geronimo, within ten (10)
days after closing Seller shall amend the name of its corporation to RJD, Ltd.
1.2.2 The current business website, www.rdgeronimo.com, including all
intellectual property affiliated with the website and website management tools and
interfaces.
1 | Asset Purchase Agreement
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1.2.3 Any and all online presence for the Business, including social media pages
(Facebook, Instagram, etc.).
1.2.4 The phone numbers: 294-8600 all 294-
(516) (including extensions); (516)
8804 (FAX)
1.2.5 Email addresses: *@rdgeronimo.com
1.2.6 Any and all signage related to the business, whether fixed or movable.
1.2.7 Intentionally Omitted.
1.2.8 Accounts Receivable. At the time of closing, Seller shall execute an
assignment of $200,000.00 accounts receivable to Buyer. In the event that at the time of
closing the total account receivable are less than $200,000.00, Seller shall contribute cash
to ensure the amount of accounts receivable and cash equal a minimum of $200,000.00.
Any and all accounts receivable of Seller in excess of $200,000.00 shall remain owned by
Seller. Set forth of Schedule 1.2.8 is a list of the accounts receivable assigned to Buyer.
1.2.9 Intentionally Omitted.
1.2.10 Intentionally Omitted.
1.2.11 Intentionally Omitted.
1.2.12 All prospective buyers known to Seller
1.2.13 Any and all relationships with vendors, bankers, and financial institutions
1.2.14 Any and all corporate records and compliance filings
1.2.15 Any and all licenses pertaining to the business.
1.2.16 Any and all pending orders not yet completed before the closing date of this
Agreements.
1.2.17 All other tangible property listed on Schedule 1.2.17 attached hereto and
made part of this agreement.
1.2.18 Seller agrees to cooperate fully in executing any necessary documents to
transfer its interest in the above-described property to Buyer, including, but not limited to,
the Bill of Sale annexed hereto as Exhibit "A".
1.2.19 To the extent title to certain property cannot pass absent additional
documentation, Seller and Buyer agree to prepare and execute such additional
documentation within seven (7) days of a request or presentation of such.
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1.2.20 Assignment of leased equipment shown on Schedule 1.2.20 subject to
consent of Lessor thereof, if required, and Buyer agrees to assume the obligations thereof
and indemnify Seller and RJD for the same.
1.3 Excluded Assets. All cash and cash equivalents, except as set forth in 1.4.5
hereof. All other assets of the Business have been included in Section 1.2 above as well as
the attached Schedule 1.2.17. In the event certain business assets were omitted, it is the
intent of the parties that such were intended to be listed herein, that such were omitted
unintentionally, and that all such omitted assets pass to Buyer in conjunction with this
Agreement.
1.4 Contracts and Liabilities of Seller.
1.4.1 Seller shall remain liable for any liabilities which accrued prior to
closing due to the gross negligence of an individual or individuals employed by Seller prior
to closing, not disclosed in the due-diligence process and/or RJD knew of or had reason to
know had accrued.
1.4.2 Seller shall defend, indemnify and hold harmless the Buyer, its agents,
employees, attorneys, accountants and other professionals, from and against any claims,
mandsrcauses-of-action liabilitiesroostsrexpensesrlawsuits (includingreasonable
attorneys'
fees) damages, awards, etc., which existed, arose, or accrued prior to the date of
closing.
1.4.3 Buyer shall defend, indemnify and hold harmless the Seller, his agents,
employees, attorneys, accounts and other professionals, from and against any claims,
demands, causes of action, liabilities, costs, expenses, lawsuits (including reasonable
attorneys'
fees) damages, awards, etc., which exist, arise, accrued subsequent to the date of
closing. This indemnification specifically excludes any claim, demands, causes of action,
liabilities, costs, expenses, lawsuits, etc., which arise or could arise as a result of RJD's
actions as an employee/manager of the company after the date of closing.
1.4.4 Seller shall remain liable for the PPP loan and/or any and all other
lines of credit in the name of the business. In the event any portion of any PPP loan is not
forgiven as of the closing, Seller shall continue responsibility for such amount. Any unused
portion of the PPP loan at the time of closing shall be held in escrow until forgiveness is
given by the SBA. Upon forgiveness, any remaining PPP funds shall be given to Seller.
Seller represents that to the best of its knowledge, all funds obtained from PPP loans were
used for expenses which entitle it to be fully forgiven.
1.4.5 Seller shall open a money market account with TD bank under the
name of R.D. Geronimo, LLC, and shall deposit the sum of $100,000.00 with its own funds
which shall be held and pledged as working capital for a period of 12 months. Such
working capital shall be used exclusively for operating expenses related to Buyer's conduct
of the business operations of Seller as continued by Buyer and not for any related, affiliated
or business operations of Buyer other than the New York office acquired from Seller. Upon
the expiration of 12 months, Seller shall receive his $100,000.00 deposit back.
3 Asset Purchase Agreement
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1.4.6 Upon the closing, Buyer shall cause to be deposited into the operating
account of the entity operating the purchased business hereunder, Archstone Goup NYC LLC,
(Archstone) not less than $150,000 to provide sufficient working capital and liquidity for the
operations of Archstone. Buyer shall deposit into the operating account such additional amounts
as necessary so that during the 12 months after the closing, the balance in the operating account
is a minimum of $150,000 excluding any of the funds that may otherwise be available from the
account established in 1.4.5 hereof. At all times until the later of (i) any amounts are still owed
under the Note provided for in 2.1.2 hereof; or (ii) Richard J. DiGeronimo is employed by
Archstone, Buyer shall cause the operating account of Archstone to have a minimum balance of
$150,000.
1.5 Contracts and Liabilities of Buyer.
1.5.1 Buyer shall initially continue the relationship with Seller's current
employees (including Jan DiGeronimo) subject to acceptable performance on the same
terms and conditions.
1.5.2 For a period of two years (or such other time as mutually agreed) all
operations, and any current employees who choose to remain employed, shall continue
under the current Business branding to allow sufficient time for this transition and to
locate and secure an MAI designated Appraiser for the New York office. Buyer shall work
to transition all operations/branding to its Archstone business umbrella as reasonably
practical within that time.
1.5.3 RJD shall continue his current role at a salary of $268,000.00 per year.
Additionally, RJD shall receive a 10% account manager fee for referral of any business
outside of New York City, Nassau, Suffolk and Westchester Counties by the New York office
for a period of three (3) years, unless otherwise agreed in writing. During the period of
RJD's employ, he shall have a seat on the board of directors of Buyer and participate fully in
the management of the acquired Business as the CEO of the New York office.
1.5.3.1 The company shall additionally pay up to $1,500.00 per month for
RJD's reimbursable expenses (car payment, car insurance, cell phone, etc.), plus any regular
employee reimbursable expenses.
1.5.3.2 Buyer shall continue to pay RJD's life insurance (Mass Mutual) at a
yearly cost of $32,000.00, plus health insurance during the period of RJD's employ.
1.5.4 Buyer shall initially retain in place, for a minimum period of two
years, the currently existing or similar 401k plan and shall continue to provide an
employee match for RJD as it does any other employee on a fully vested basis. Employer
required 401k contributions shall become the responsibility of Buyer. Thereafter, Buyer
may, at any time, amend, change, or otherwise terminate said plan.
1.5.5 The parties will jointly work to on-board a new MAI designated
appraiser within 2 years.
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1.5.6 RJD shall contribute to Buyer any amounts he receives from ABS RD
Geronimo Valuation Services, LLC, promptly upon receipt.
1.5.7 Seller and Buyer, respectively, agree that after the Closing, any
accounts receivable paid and received by a party which is then owned by the other party
shall promptly deliver such amounts to the party who then owned that account receivable.
1.5.8 In addition to all other sums, Buyer shall pay to RJD a signing bonus of
$20,000.00 on or before January 31, 2022 and an additional bonus of $20,000.00 on or
before January 31, 2023.
2 Purchase Price.
2.1 As and for consideration for the Business and all listed assets, the adequacy
and sufficiency of which is hereby acknowledged, and any challenge to the sufficiency
thereof forever waived, Buyer shall pay to Seller the sum of ONE MILLION FOUR
HUNDRED THOUSAND DOLLARS ($1,400,000.00), as follows:
2.1.1 A down payment of $700,000.00 at the time of closing ("Down
Payment").
2.1.2 The balance of $700,000.00 shall be paid in sixteen (16) equal
quarterly installments of $43,750.00, plus interest at 5.5% per annum, beginning March 1,
2022, and every quarter thereafter. The principals of Buyer, Michael Miller, Royce Ashton
Rowles and Ryan Lynn, shall provide personal guaranties to Seller securing the unpaid
balance. Such balance shall be in the form of a Note in the form annexed hereto as Exhibit
"B".
2.1.3 ADIUSTMENT TO PURCHASE PRICE. The purchase price set forth
herein is subject to an adjustment-based bonus of 10% of any year over year increase in
gross revenue, on an accrual basis, at the current NY Office over a base of $1,900,000.00,
for a period of five (5) years after execution of this Agreement.
2.1.4 REDUCTION IN PURCHASE PRICE. It is a material term to this
Agreement that the current NY office gross revenue, on an accrual basis, defined as
$1,700,000.00 (defined as "GR") , must be maintained for the three (3) year period after
execution of this Agreement (or for such longer period that RJD continues to be employed
by Company, up to a maximum period of five (5) years). In the event that GR declines, as
measured annually on the anniversary date of the Closing, then the purchase price shall
decrease by 7.5% of the amount of the decline in GR. For example, if the NY office GR
decreases by $100,000 in the first year, then the purchase price would decrease by
$7,500.00. Said decrease shall reduce the amortized payments for the following calendar
year. In the event Buyer has prepaid the balance due such that sufficient payments do not
remain to offset any given reduction in purchase price, Seller shall, within 30 days of the
end of any applicable calendar year, pay to buyer, via certified funds, any applicable
reduction in purchase price.
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2.2 The parties agree that the Purchase Price represents fair value for the
Business and Purchased Assets and agree that this transaction was negotiated at arm's
length and in good faith.
2.3 At the Closing, Buyer shall execute a Security Agreement in the form annexed
"D"
hereto as Exhibit to secure the Buyer's obligations to Seller herein.
3 Closing.
3.1 Intentionally Omitted.
3.2 Title Passage. Except as otherwise provided in this Section, upon the Closing,
Seller's right, title and interest in the Purchased Assets shall pass to Buyer. Subject to the
foregoing, upon Closing, Seller shall: (I) make available to Buyer possession of all of the
Purchased Assets as provided in Section 1.2 and the attached Schedules and (ii) deliver to
Buyer proper assignments, conveyances and bills of sale ("Bill of Sale"), sufficient to convey
to Buyer title to all the Purchased Assets, in accordance with the terms of this Agreement,
as well as such other instruments of conveyance necessary (both at and after the Closing)
to effect or evidence the transfers contemplated hereby.
3.3 Availability of Purchased-Assets-The-Purchased Assets and-all-deeuments to
be provided by Seller to Buyer pursuant to this Agreement shall be made available to the
Buyer at the Seller's principal place of business, or at such other location as shall be
mutually acceptable to the parties. Seller shall cooperate with all reasonable requests of
Buyer regarding arrangements to transfer the Purchased Assets.
3.4 Closing. The Closing shall be held at the offices of Seller, or its counsel, or
remotely, or such other place as may be agreed upon by the parties, no later than 5:00 p.m.
Eastern Time on or about April 30, 2021, unless extended in writing by the mutual
agreement of Buyer and Seller.
4 Taxes. Income taxes, including capital gains taxes (defined collectively as "Income
Taxes"), arising from the transfer of the Purchased Assets or that would be due thereon, if
any, shall be paid by and be the obligation of the Seller. Seller shall defend, indemnify and
hold harmless the Buyer, his agents, employees, attorneys, accountants and other
professionals, from and against any claims, demands, causes of action, liabilities, costs,
attorneys'
expenses (including reasonable fees) damages, awards and penalties arising out
of or resulting from the Income Taxes. Buyer shall pay any sales and use taxes, transfer
taxes or any other tax on the sale of the Purchased Assets. For purposes of this Agreement,
the Purchase Price is allocated as follows:
Intangible Assets including intellectual
property and goodwill $1,239,000.00
Accounts Receivable $100,000.00
Furniture, fixtures & Equipment $10,000.00
Leasehold improvements $1,000.00
Restrictive Covenants $75,000.00
Total $1,400,000.00
6 Asset Purchase Agreement
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5 Representations and Warranties.
5 5.1 Each party represents and warrants to the other that it has, or at Closing
shall have, the authority to enter into the subject transaction providing for the sale of the
Purchased Assets to Buyer. Seller represents and warrants that he is transferring the
Purchased Assets free and clear of any known liens or encumbrances. Except as expressly
set forth herein, Seller makes no representations or warranties, express, implied or
statutory, including without limitation warranty of merchantability and warranty of fitness
for a particular purpose, all of which are waived and disclaimed. THE PURCHASED ASSETS
IS" FAULTS."
SHALL BE SOLD IN "AS IS, WHERE CONDITION "WITH ALL
5.2 Buyer represents that it is not a party to any security agreement, whereby it has
agreed to pledge, lien, hypothecate or grant a UCC security interest in the assets to be
acquired hereunder or to any agreement that, by its terms, will create such an interest in
the after acquired assets transferred by Seller to Buyer hereunder.
6 Closing Obligations.
6.1 Buyer's Closing Obligations. At the Closing, Buyer shall deliver to Seller the
following:
6.1.1 Executed Agreements, Bill of Sale, any assignments.
6.1.2 Personal Guaranties
6.1.3 Note
6.1.4 The Down Payment
6.1.5 A resolution of Buyer authorizing the purchase described herein and
the delivery of the Note
6.2 Seller's Closing Obligations. At the Closing, Seller shall deliver to Buyer the
following:
6.2.1 The Bill of Sale conveying all of Sellers right, title and interest in and
to the Purchased Assets (Exhibit"A").
6.2.2 A duly executed non-competition/non-solicitation agreement in the
form annexed hereto as Exhibit "
Preview
FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 EXHIBIT 2 FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 ASSFT PURCHASE AGREEMENT This Asset Purchase Agreement ("Agreement"), dated as of , is entered Group" into by and between Property Analytix, LLC, DBA "Archstone and Archstone Group NYC LLC, (collectively, "Buyer") and RD Geronimo, Ltd. ("Seller"), a New York Corporation, and Richard J. DiGeronimo ("RJD") based on the following recitals, terms and conditions. RECITALS R. D. Geronimo a New York located at 158 3rd WHEREAS, LTD, Corporation, St., Mineola, NY 11501, is a real estate appraisal business (the "Business"); and WHEREAS, RJD is the sole owner of 100% of the stock of the Business; and WHEREAS, Seller is the sole owner of various pieces of equipment, products, inventory, and other assets used in connection with the Business; and WHEREAS, Buyer desires to purchase and Seller desires to sell the Business and all of its tangible-and-intangible assets-(except as set forth-he-rein) utilized in-relation to the Business, all of which is the property of Seller, upon the terms and conditions set forth in this Agreement; and NOW, THEREFORE, in consideration of the foregoing recitals and the terms and conditions set forth below, the parties hereby agree as follows: 1 Purchase and Sale 1.1 Agreement to Sell and Purchase Purchased Assets. Subject to the terms and conditions of this Agreement, and in reliance on the representations, warranties and covenants set forth in this Agreement, Seller agrees to sell, assign, transfer and convey to Buyer at the Closing, and Buyer agrees to purchase and acquire from Seller at the Closing, all of Seller's right, title and interest in and to the Business and all of the Purchased Assets (as defined in Section 1.2 below), free and clear of all liens, claims, encumbrances and interests of record, or of which Seller has knowledge after a reasonable inquiry. Assets" 1.2 Assets to be Sold. The "Purchased specifically include, but are not limited to, the following: 1.2.1 The goodwill of Seller, including the name R.D. Geronimo, within ten (10) days after closing Seller shall amend the name of its corporation to RJD, Ltd. 1.2.2 The current business website, www.rdgeronimo.com, including all intellectual property affiliated with the website and website management tools and interfaces. 1 | Asset Purchase Agreement FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 1.2.3 Any and all online presence for the Business, including social media pages (Facebook, Instagram, etc.). 1.2.4 The phone numbers: 294-8600 all 294- (516) (including extensions); (516) 8804 (FAX) 1.2.5 Email addresses: *@rdgeronimo.com 1.2.6 Any and all signage related to the business, whether fixed or movable. 1.2.7 Intentionally Omitted. 1.2.8 Accounts Receivable. At the time of closing, Seller shall execute an assignment of $200,000.00 accounts receivable to Buyer. In the event that at the time of closing the total account receivable are less than $200,000.00, Seller shall contribute cash to ensure the amount of accounts receivable and cash equal a minimum of $200,000.00. Any and all accounts receivable of Seller in excess of $200,000.00 shall remain owned by Seller. Set forth of Schedule 1.2.8 is a list of the accounts receivable assigned to Buyer. 1.2.9 Intentionally Omitted. 1.2.10 Intentionally Omitted. 1.2.11 Intentionally Omitted. 1.2.12 All prospective buyers known to Seller 1.2.13 Any and all relationships with vendors, bankers, and financial institutions 1.2.14 Any and all corporate records and compliance filings 1.2.15 Any and all licenses pertaining to the business. 1.2.16 Any and all pending orders not yet completed before the closing date of this Agreements. 1.2.17 All other tangible property listed on Schedule 1.2.17 attached hereto and made part of this agreement. 1.2.18 Seller agrees to cooperate fully in executing any necessary documents to transfer its interest in the above-described property to Buyer, including, but not limited to, the Bill of Sale annexed hereto as Exhibit "A". 1.2.19 To the extent title to certain property cannot pass absent additional documentation, Seller and Buyer agree to prepare and execute such additional documentation within seven (7) days of a request or presentation of such. FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 1.2.20 Assignment of leased equipment shown on Schedule 1.2.20 subject to consent of Lessor thereof, if required, and Buyer agrees to assume the obligations thereof and indemnify Seller and RJD for the same. 1.3 Excluded Assets. All cash and cash equivalents, except as set forth in 1.4.5 hereof. All other assets of the Business have been included in Section 1.2 above as well as the attached Schedule 1.2.17. In the event certain business assets were omitted, it is the intent of the parties that such were intended to be listed herein, that such were omitted unintentionally, and that all such omitted assets pass to Buyer in conjunction with this Agreement. 1.4 Contracts and Liabilities of Seller. 1.4.1 Seller shall remain liable for any liabilities which accrued prior to closing due to the gross negligence of an individual or individuals employed by Seller prior to closing, not disclosed in the due-diligence process and/or RJD knew of or had reason to know had accrued. 1.4.2 Seller shall defend, indemnify and hold harmless the Buyer, its agents, employees, attorneys, accountants and other professionals, from and against any claims, mandsrcauses-of-action liabilitiesroostsrexpensesrlawsuits (includingreasonable attorneys' fees) damages, awards, etc., which existed, arose, or accrued prior to the date of closing. 1.4.3 Buyer shall defend, indemnify and hold harmless the Seller, his agents, employees, attorneys, accounts and other professionals, from and against any claims, demands, causes of action, liabilities, costs, expenses, lawsuits (including reasonable attorneys' fees) damages, awards, etc., which exist, arise, accrued subsequent to the date of closing. This indemnification specifically excludes any claim, demands, causes of action, liabilities, costs, expenses, lawsuits, etc., which arise or could arise as a result of RJD's actions as an employee/manager of the company after the date of closing. 1.4.4 Seller shall remain liable for the PPP loan and/or any and all other lines of credit in the name of the business. In the event any portion of any PPP loan is not forgiven as of the closing, Seller shall continue responsibility for such amount. Any unused portion of the PPP loan at the time of closing shall be held in escrow until forgiveness is given by the SBA. Upon forgiveness, any remaining PPP funds shall be given to Seller. Seller represents that to the best of its knowledge, all funds obtained from PPP loans were used for expenses which entitle it to be fully forgiven. 1.4.5 Seller shall open a money market account with TD bank under the name of R.D. Geronimo, LLC, and shall deposit the sum of $100,000.00 with its own funds which shall be held and pledged as working capital for a period of 12 months. Such working capital shall be used exclusively for operating expenses related to Buyer's conduct of the business operations of Seller as continued by Buyer and not for any related, affiliated or business operations of Buyer other than the New York office acquired from Seller. Upon the expiration of 12 months, Seller shall receive his $100,000.00 deposit back. 3 Asset Purchase Agreement FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 1.4.6 Upon the closing, Buyer shall cause to be deposited into the operating account of the entity operating the purchased business hereunder, Archstone Goup NYC LLC, (Archstone) not less than $150,000 to provide sufficient working capital and liquidity for the operations of Archstone. Buyer shall deposit into the operating account such additional amounts as necessary so that during the 12 months after the closing, the balance in the operating account is a minimum of $150,000 excluding any of the funds that may otherwise be available from the account established in 1.4.5 hereof. At all times until the later of (i) any amounts are still owed under the Note provided for in 2.1.2 hereof; or (ii) Richard J. DiGeronimo is employed by Archstone, Buyer shall cause the operating account of Archstone to have a minimum balance of $150,000. 1.5 Contracts and Liabilities of Buyer. 1.5.1 Buyer shall initially continue the relationship with Seller's current employees (including Jan DiGeronimo) subject to acceptable performance on the same terms and conditions. 1.5.2 For a period of two years (or such other time as mutually agreed) all operations, and any current employees who choose to remain employed, shall continue under the current Business branding to allow sufficient time for this transition and to locate and secure an MAI designated Appraiser for the New York office. Buyer shall work to transition all operations/branding to its Archstone business umbrella as reasonably practical within that time. 1.5.3 RJD shall continue his current role at a salary of $268,000.00 per year. Additionally, RJD shall receive a 10% account manager fee for referral of any business outside of New York City, Nassau, Suffolk and Westchester Counties by the New York office for a period of three (3) years, unless otherwise agreed in writing. During the period of RJD's employ, he shall have a seat on the board of directors of Buyer and participate fully in the management of the acquired Business as the CEO of the New York office. 1.5.3.1 The company shall additionally pay up to $1,500.00 per month for RJD's reimbursable expenses (car payment, car insurance, cell phone, etc.), plus any regular employee reimbursable expenses. 1.5.3.2 Buyer shall continue to pay RJD's life insurance (Mass Mutual) at a yearly cost of $32,000.00, plus health insurance during the period of RJD's employ. 1.5.4 Buyer shall initially retain in place, for a minimum period of two years, the currently existing or similar 401k plan and shall continue to provide an employee match for RJD as it does any other employee on a fully vested basis. Employer required 401k contributions shall become the responsibility of Buyer. Thereafter, Buyer may, at any time, amend, change, or otherwise terminate said plan. 1.5.5 The parties will jointly work to on-board a new MAI designated appraiser within 2 years. FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 1.5.6 RJD shall contribute to Buyer any amounts he receives from ABS RD Geronimo Valuation Services, LLC, promptly upon receipt. 1.5.7 Seller and Buyer, respectively, agree that after the Closing, any accounts receivable paid and received by a party which is then owned by the other party shall promptly deliver such amounts to the party who then owned that account receivable. 1.5.8 In addition to all other sums, Buyer shall pay to RJD a signing bonus of $20,000.00 on or before January 31, 2022 and an additional bonus of $20,000.00 on or before January 31, 2023. 2 Purchase Price. 2.1 As and for consideration for the Business and all listed assets, the adequacy and sufficiency of which is hereby acknowledged, and any challenge to the sufficiency thereof forever waived, Buyer shall pay to Seller the sum of ONE MILLION FOUR HUNDRED THOUSAND DOLLARS ($1,400,000.00), as follows: 2.1.1 A down payment of $700,000.00 at the time of closing ("Down Payment"). 2.1.2 The balance of $700,000.00 shall be paid in sixteen (16) equal quarterly installments of $43,750.00, plus interest at 5.5% per annum, beginning March 1, 2022, and every quarter thereafter. The principals of Buyer, Michael Miller, Royce Ashton Rowles and Ryan Lynn, shall provide personal guaranties to Seller securing the unpaid balance. Such balance shall be in the form of a Note in the form annexed hereto as Exhibit "B". 2.1.3 ADIUSTMENT TO PURCHASE PRICE. The purchase price set forth herein is subject to an adjustment-based bonus of 10% of any year over year increase in gross revenue, on an accrual basis, at the current NY Office over a base of $1,900,000.00, for a period of five (5) years after execution of this Agreement. 2.1.4 REDUCTION IN PURCHASE PRICE. It is a material term to this Agreement that the current NY office gross revenue, on an accrual basis, defined as $1,700,000.00 (defined as "GR") , must be maintained for the three (3) year period after execution of this Agreement (or for such longer period that RJD continues to be employed by Company, up to a maximum period of five (5) years). In the event that GR declines, as measured annually on the anniversary date of the Closing, then the purchase price shall decrease by 7.5% of the amount of the decline in GR. For example, if the NY office GR decreases by $100,000 in the first year, then the purchase price would decrease by $7,500.00. Said decrease shall reduce the amortized payments for the following calendar year. In the event Buyer has prepaid the balance due such that sufficient payments do not remain to offset any given reduction in purchase price, Seller shall, within 30 days of the end of any applicable calendar year, pay to buyer, via certified funds, any applicable reduction in purchase price. FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 2.2 The parties agree that the Purchase Price represents fair value for the Business and Purchased Assets and agree that this transaction was negotiated at arm's length and in good faith. 2.3 At the Closing, Buyer shall execute a Security Agreement in the form annexed "D" hereto as Exhibit to secure the Buyer's obligations to Seller herein. 3 Closing. 3.1 Intentionally Omitted. 3.2 Title Passage. Except as otherwise provided in this Section, upon the Closing, Seller's right, title and interest in the Purchased Assets shall pass to Buyer. Subject to the foregoing, upon Closing, Seller shall: (I) make available to Buyer possession of all of the Purchased Assets as provided in Section 1.2 and the attached Schedules and (ii) deliver to Buyer proper assignments, conveyances and bills of sale ("Bill of Sale"), sufficient to convey to Buyer title to all the Purchased Assets, in accordance with the terms of this Agreement, as well as such other instruments of conveyance necessary (both at and after the Closing) to effect or evidence the transfers contemplated hereby. 3.3 Availability of Purchased-Assets-The-Purchased Assets and-all-deeuments to be provided by Seller to Buyer pursuant to this Agreement shall be made available to the Buyer at the Seller's principal place of business, or at such other location as shall be mutually acceptable to the parties. Seller shall cooperate with all reasonable requests of Buyer regarding arrangements to transfer the Purchased Assets. 3.4 Closing. The Closing shall be held at the offices of Seller, or its counsel, or remotely, or such other place as may be agreed upon by the parties, no later than 5:00 p.m. Eastern Time on or about April 30, 2021, unless extended in writing by the mutual agreement of Buyer and Seller. 4 Taxes. Income taxes, including capital gains taxes (defined collectively as "Income Taxes"), arising from the transfer of the Purchased Assets or that would be due thereon, if any, shall be paid by and be the obligation of the Seller. Seller shall defend, indemnify and hold harmless the Buyer, his agents, employees, attorneys, accountants and other professionals, from and against any claims, demands, causes of action, liabilities, costs, attorneys' expenses (including reasonable fees) damages, awards and penalties arising out of or resulting from the Income Taxes. Buyer shall pay any sales and use taxes, transfer taxes or any other tax on the sale of the Purchased Assets. For purposes of this Agreement, the Purchase Price is allocated as follows: Intangible Assets including intellectual property and goodwill $1,239,000.00 Accounts Receivable $100,000.00 Furniture, fixtures & Equipment $10,000.00 Leasehold improvements $1,000.00 Restrictive Covenants $75,000.00 Total $1,400,000.00 6 Asset Purchase Agreement FILED: NASSAU COUNTY CLERK 08/28/2023 05:49 PM INDEX NO. 608383/2023 NYSCEF DOC. NO. 16 RECEIVED NYSCEF: 08/28/2023 5 Representations and Warranties. 5 5.1 Each party represents and warrants to the other that it has, or at Closing shall have, the authority to enter into the subject transaction providing for the sale of the Purchased Assets to Buyer. Seller represents and warrants that he is transferring the Purchased Assets free and clear of any known liens or encumbrances. Except as expressly set forth herein, Seller makes no representations or warranties, express, implied or statutory, including without limitation warranty of merchantability and warranty of fitness for a particular purpose, all of which are waived and disclaimed. THE PURCHASED ASSETS IS" FAULTS." SHALL BE SOLD IN "AS IS, WHERE CONDITION "WITH ALL 5.2 Buyer represents that it is not a party to any security agreement, whereby it has agreed to pledge, lien, hypothecate or grant a UCC security interest in the assets to be acquired hereunder or to any agreement that, by its terms, will create such an interest in the after acquired assets transferred by Seller to Buyer hereunder. 6 Closing Obligations. 6.1 Buyer's Closing Obligations. At the Closing, Buyer shall deliver to Seller the following: 6.1.1 Executed Agreements, Bill of Sale, any assignments. 6.1.2 Personal Guaranties 6.1.3 Note 6.1.4 The Down Payment 6.1.5 A resolution of Buyer authorizing the purchase described herein and the delivery of the Note 6.2 Seller's Closing Obligations. At the Closing, Seller shall deliver to Buyer the following: 6.2.1 The Bill of Sale conveying all of Sellers right, title and interest in and to the Purchased Assets (Exhibit"A"). 6.2.2 A duly executed non-competition/non-solicitation agreement in the form annexed hereto as Exhibit "