ASSET
PURCHASE AGREEMENT
by and between
CAROLINA CAPITAL VENTURES, LTD.
Seller,
and
RALEIGH FAMILY GOLF CENTERS, INC.,
Purchaser
PREMISES:
0000 Xxxxxxx Xxxxxxxxx
Xxxx Xxxxxx, Xxxxx Xxxxxxxx
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INDEX OF EXHIBITS AND SCHEDULES
EXHIBIT A LEGAL DESCRIPTION
EXHIBIT B PERSONAL PROPERTY
EXHIBIT C CONTRACTS
EXHIBIT D LEASE
EXHIBIT E ESCROW AGREEMENT
EXHIBIT F PERMITTED EXCEPTIONS
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ASSET
PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT, made as of the __th day of March, 1997
(this "Agreement"), by and between CAROLINA CAPITAL VENTURES, LTD., a North
Carolina corporation having an address 0000 Xxxxxxx Xxxxxxxxx, Xxxx Xxxxxx,
Xxxxx Xxxxxxxx 00000 ("Seller"), and RALEIGH FAMILY GOLF CENTERS, INC., a
Delaware corporation having an address at 000 Xxxxxxxxxxx Xxxx, Xxxxx 000X,
Xxxxxxxx, Xxx Xxxx 00000 ("Purchaser").
W I T N E S S E T H :
WHEREAS, Seller is the owner of certain real property located 0000
Xxxxxxx Xxxxxxxxx, Xxxx Xxxxxx, Xxxxx Xxxxxxxx 00000 and more particularly
described on Exhibit A attached hereto and made a part hereof, which is
subject to that certain Option Agreement by and between the Seller and Xxxxxxx
X. Xxxxxxx, dated March 12, 0000 (xxx "Xxxx") and the buildings and
improvements located on the Land (the "Improvements" and, together with the
Land, the "Premises");
WHEREAS, Seller operates a driving range and related facilities
at the Premises under the name "The Capital Sports Golf Center" (the
"Business"); and
WHEREAS, Seller wants to lease the Premises, and sell certain
assets, to the Purchaser, and Purchaser want to lease the Premises, and
purchase certain assets, from the Seller, on the terms, and subject to the
conditions, set forth herein.
NOW, THEREFORE, in consideration of the respective premises,
mutual covenants and agreements of the parties hereto, and other good and
valuable consideration, the receipt and
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sufficiency of which are hereby acknowledged, the parties hereto agree to the
foregoing and as follows:
1. Agreement to Sell and Purchase Certain Assets.
1.1 Property to be Purchased by Purchaser. Seller agrees to
sell and convey to Purchaser, and Purchaser agrees to purchase and acquire
from Seller, upon the terms and conditions hereinafter set forth, all of
Seller's right, title and interest in and to the following property
(collectively, the "Property"):
1.1.1 all furnishings, fixtures, machinery,
equipment, vehicles and personalty attached or appurtenant to or used in
connection with the Premises that are owned by Seller, and all inventories,
supplies, sales, marketing and instructional materials of every kind and
description relating to the Business, wherever located, including without
limitation, the items described on Exhibit B attached hereto and made a part
hereof and which are being transferred "as is" with no representations or
warranties as to condition (the "Personal Property");
1.1.2 the files, books, notices and other
correspondence from any governmental agencies, and other records used or
employed by Seller or its affiliates in connection with the ownership and/or
operation of the Premises and the Business (collectively, the "Records");
1.1.3 any consents, authorizations, variances,
waivers, licenses, certificates, permits and approvals held by or granted to
Seller in connection with the ownership of the Premises or operation of the
Business (collectively, the "Permits");
1.1.4 the contracts, leases and other agreements
of or relating to the Business described on Exhibit C attached hereto and made
a part hereof, except to
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the extent the same relate solely to any Retained Assets or Retained
Liabilities (as hereinafter defined) (the "Contracts");
1.1.5 all accounts receivable of Seller arising
out of the sale of goods or services rendered at the Premises or otherwise in
connection with the Business on or after the Closing Date (as hereinafter
defined);
1.1.6 any manufacturers' and vendors' warranties
and guarantees, except to the extent the same relate solely to any Retained
Assets or Retained Liabilities (the "Claims"); and
1.1.7 any other properties and assets of every
kind and nature, real or personal, tangible or intangible, relating in any way
whatsoever to the Premises or the Business, except to the extent the same
relate solely to the Retained Assets or Retained Liabilities.
1.2 Assets to be Retained by Seller. Anything herein to the
contrary notwithstanding, Seller shall not sell, and Purchaser shall not
acquire, the following assets of Seller (the "Retained Assets"):
1.2.1 all trade accounts receivable arising out
of the sale of goods or services prior to the Closing Date;
1.2.2 any rights of Seller with respect to
insurance policies owned by Seller or for which Seller is the named insured;
1.2.3 all cash, funds in bank accounts and cash
equivalents existing as of the Closing Date hereof; and
1.2.4 any patents, trademarks, trademark
registrations, copyrights, copyright registrations, trade names and all
registrations thereof and all applications for
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any of the foregoing, whether issued or pending, if any, and all goodwill
associated with any of the foregoing (the "Intangible Assets").
1.3 Assumption of Certain Liabilities. Purchaser shall
assume and agree to pay and discharge when due: (i) all liabilities and
obligations of Seller under the Contracts to the extent the same arise from
and after the Closing Date and (ii) up to $500 of outstanding commitments to
customers with respect to pre-paid range ball cards and gift certificates (the
"Assumed Liabilities").
1.4 Liabilities to be Retained by Purchaser. Seller shall
retain, and Purchaser shall not assume, perform, discharge or pay, and shall
not be responsible for, any and all liabilities or obligations of any nature
whatsoever in connection with or relating to the Property, the Premises,
Seller or the Business or any predecessor owner of the Property, the Premises
or the Business other than the Assumed Liabilities (collectively, the
"Retained Liabilities"). All outstanding commitments to customers with respect
to pre-paid range ball cards and gift certificates which have not been assumed
by Purchaser, shall be honored by Purchaser and Seller shall reimburse
Purchaser all such amounts within five days after request therefore by
Purchaser.
2. Lease Of Premises. Concurrently with the execution of this
Agreement, Seller shall lease the Premises to Purchaser in accordance with,
and subject to the terms and conditions of, the Lease, attached as Exhibit D
hereto.
3. Consideration. In consideration for the Property and the
leasehold interest in the Premises, Purchaser shall pay to Seller at Closing
$1,100,000.00 (the "Purchaser Price"), payable in cash, certified or bank
check or wire transfer of funds, $100,000.00 of which shall be placed in
escrow to be held and distributed in accordance with the Escrow Agreement,
attached hereto as Exhibit E (the "Escrow Agreement").
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4. Title; Permitted Exceptions. Seller will convey the Property to
Purchaser, free and clear of any and all liens, charges, encumbrances,
pledges, security interests, agreements and other interests and adverse claims
(collectively, "Encumbrances"), other than the matters set forth in Exhibit F
attached hereto and made a part hereof (the "Permitted Exceptions").
5. Apportionments.
5.1 The parties hereto agree that (i) all operating expenses
of Seller relating to the Premises (i.e., real estate taxes, utilities,
advertising, collections, fees, hired services, insurance, miscellaneous
expenses, postage, repairs and maintenance, supplies, taxes and wages, but
specifically not including interest on indebtedness, professional fees and
expenses, travel, lodging, or depreciation), and (ii) all income of Seller,
shall be apportioned between Seller and Purchaser as of the Closing Date based
on the portion of each such expense or revenue attributable to the period
falling before the Closing Date on the one hand, which Seller shall bear the
responsibility and benefit of, and the portion of each such expense or revenue
attributable to the period falling on or after the Closing Date, on the other
hand, which Purchaser shall bear the responsibility and benefit of (the
"Adjustment"). The expenses and liabilities for which Seller shall be liable
pursuant to this Section shall be included within the meaning of the term
"Retained Liabilities".
5.2 To the extent that any of the prorations made pursuant
to this Article are based upon estimates of payments to be made and/or
expenses to be incurred by Purchaser subsequent to the Closing Date, or either
party discovers any errors in or omissions in respect of the Adjustment,
Seller and Purchaser agree to adjust such prorations promptly upon receipt by
Seller or Purchaser, as the case may be, of such payments or of bills or other
documentation setting forth the actual amount of such expenses.
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5.3 Seller and Purchaser shall maintain and make available
to each other any books or records necessary for the adjustment of any item
pursuant to this Article. The provisions of this Article shall survive the
closing of the transactions described herein (the "Closing").
6. The Closing.
6.1 The Closing of the transaction provided for in this
Agreement shall take place simultaneously with the execution and delivery of
this Agreement (the actual date of the Closing being referred to herein as the
"Closing Date").
6.2 At the Closing, Seller shall deliver or cause to be
delivered to Purchaser physical possession of the Property (receipt of which
may be actual or constructive) and the following:
6.2.1 a xxxx of sale conveying,
transferring and selling to Purchaser all right, title and interest of Seller
in and to all of the Personal Property, which xxxx of sale shall contain a
warranty that such property is free and clear of all Encumbrances other than
the Permitted Exceptions, duly executed and acknowledged by Seller;
6.2.2 an assignment and assumption
agreement (the "Assignment and Assumption Agreement") assigning to Purchaser
all of Seller's right, title and interest in and to the Contracts, the Permits
and the Claims, duly executed and acknowledged by Seller;
6.2.3 a settlement statement (the
"Settlement Statement") setting forth the amounts paid by or on behalf of
and/or credited to each of Purchaser and Seller pursuant to this Agreement;
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6.2.4 the Escrow Agreement, duly
executed and acknowledged by Seller;
6.2.5 the Lease, duly executed and
acknowledged by Seller;
6.2.6 a Certificate or Certificates
of Occupancy for all Improvements;
6.2.7 original counterparts of each
of the Contracts;
6.2.8 any transfer tax or other
return required by any applicable governmental authority in connection with
the sale of the Property, duly executed and acknowledged by Seller;
6.2.9 keys to all locks relating to
the Property, appropriately labeled;
6.2.10 all other instruments and
documents to be executed, acknowledged where appropriate and/or delivered by
Seller to Purchaser pursuant to any of the other provisions of this Agreement;
and
6.2.11 such other documents as may
be reasonably required by Purchaser's counsel in connection with this
transaction.
6.3 At the Closing, Purchaser shall deliver or cause to be
delivered to Seller the following:
6.3.1 the cash consideration
referred to in Section 2 hereof;
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6.3.2 the Assignment and Assumption
Agreement, duly executed and acknowledged by Purchaser;
6.3.3 the Settlement Statement, duly
executed and acknowledged by Purchaser;
6.3.4 the Escrow Agreement, duly
executed and acknowledged by Purchaser;
6.3.5 the Lease, duly executed and
acknowledged by Purchaser;
6.3.6 all other instruments and
documents to be executed, acknowledged where appropriate and/or delivered by
Purchaser to Seller; and
6.3.7 such other documents as may be
reasonably required by Seller's counsel in connection with this transaction.
7. Representations and Warranties.
7.1 Seller represents and warrants to Purchaser as
follows:
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7.1.1 Organization; Power and Authority. Seller is a
corporation duly formed, validly existing and in good standing under the laws
of the State of North Carolina, and has all requisite power and authority to
carry on its business as it is now being conducted, to execute, deliver and
perform its obligations under this Agreement and to consummate the
transactions contemplated hereby.
7.1.2 Due Authorization and Execution; Effect of
Agreement. The execution, delivery and performance by Seller of this Agreement
and the consummation by Seller of the transactions contemplated hereby have
been duly authorized by all necessary corporate action required to be taken on
the part of Seller. This Agreement has been duly and validly executed and
delivered by Seller and constitutes the valid and binding obligation of
Seller, enforceable in accordance with its terms, except to the extent that
such enforceability (a) may be limited by bankruptcy, insolvency, or other
similar laws relating to creditors' rights generally; and (b) is subject to
general principles of equity.
7.1.3 Consents. No consent, approval or authorization of,
exemption by, or filing with, any governmental or regulatory authority or any
third party is required in connection with the execution, delivery and
performance by Seller of this Agreement, except for consents, approvals,
authorizations, exemptions and filings, if any, which have been obtained.
7.1.4 Compliance with Applicable Laws. Seller is not
engaging in any activity or omitting to take any action as a result of which
Seller is in violation of any material law, rule, regulation, ordinance,
statute, order, injunction or decree, or any other requirement of any court or
governmental or administrative body or agency, applicable to the Property or
the Business, and neither the execution and delivery by Seller of this
Agreement or of
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any of the other agreements and instruments to be executed and delivered by it
pursuant hereto, the performance by Seller of its obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby will result in any such violation. Seller is in compliance with all
material requirements imposed in writing by any insurance carrier of Seller to
the extent such carrier is an insurer or indemnitor of the Property. The
Premises are not subject to any notice of violation of law, municipal
ordinance, orders or requirements issued by any building department or other
governmental agency or subdivision having jurisdiction.
7.1.5 Permits. All Permits required by any federal,
state, or local law, rule or regulation and necessary for the operation of the
Property and the Business as currently being conducted have been obtained and
are currently in effect. No registrations, filings, applications, notices,
transfers, consents, approvals, orders, qualifications, waivers or other
actions of any kind are required by virtue of the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby (a)
to avoid the loss of any Permit or the violation of any law, regulation, order
or other requirement of law, or (b) to enable Purchaser to continue the
operation of the Property as presently conducted after the Closing. The
current use and occupation of any portion of the Property does not violate any
of, and, where applicable, is in material compliance with, the Permits, any
applicable deed restrictions or other covenants, restrictions or agreements
including without limitation, any of the Permitted Exceptions, site plan
approvals, zoning or subdivision regulations or urban redevelopment plans
applicable to the Premises.
7.1.6 Title to Assets. Seller has good and marketable
title to the Property free and clear of all Encumbrances other than the
Permitted Exceptions.
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7.1.7 Contracts. Except as set forth on Exhibit C, Seller
is not a party to any leases, contracts, orders or agreements relating to the
Property or the Business (written or otherwise) (collectively, "Contracts").
Exhibit C sets forth a full and complete description of the Contracts
described therein, and none of such Contracts have been amended or modified
except as reflected on said Exhibits. Seller is not holding any security
deposits under any of said Contracts. Each of the Contracts are in full force
and effect and no party under any such Contract, including Seller, is in
default, or has sent or received notice of default, in any respect of any such
Contract.
7.1.8 INTENTIONALLY OMITTED.
7.1.9 INTENTIONALLY OMITTED.
7.1.10 Environmental Matters.
7.1.10.1 As used in this Agreement
"Hazardous Material" shall mean: (i) any "hazardous substance" as now defined
pursuant to the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("CERCLA"), 42 U.S.C. ' 9601(33); (ii) any "pollutant or
contaminant" as defined in 42 U.S.C. ' 9601(33); (iii) any material now
defined as "hazardous waste" pursuant to 40 C.F.R. Part 261; (iv) any
petroleum, including crude oil and any fraction thereof; (v) natural or
synthetic gas usable for fuel; (vi) any "hazardous chemical" as defined
pursuant to 29 C.F.R. Part 1910; (vii) any asbestos, asbestos containing
material, polychlorinated biphenyl ("PCB"), or isomer of dioxin, or any
material or thing containing or composed of such substance or substances; and
(viii) any other pollutant, contaminant, chemical, or industrial or hazardous,
toxic or dangerous waste, substance or material,
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defined or regulated as such in (or for purposes of any Environmental Law (as
hereinafter defined) and any other toxic, reactive or flammable chemicals.
7.1.10.2 To the best of Seller's
knowledge, there is no Hazardous Material at, under or on the Premises and
there is no ambient air, surface water, groundwater or land contamination
within, under, originating from or relating to the Premises. Seller has not,
and has not caused to be, manufactured, processed, distributed, used, treated,
stored, disposed of, transported or handled any Hazardous Material at, on or
under the Premises.
7.1.10.3 To the best of Seller's
knowledge, Seller has no obligation or liability imposed or based upon any
provision under any foreign, federal, state or local law, rule, or regulation
or common law, or under any code, order, decree, judgment or injunction
applicable to Seller or the Property or any notice, or request for information
issued, promulgated, approved or entered thereunder, or under the common law,
or any tort, nuisance or absolute liability theory, relating to public health
or safety, worker health or safety, or pollution, damage to or protection to
the environment, including without limitation, laws relating to emissions,
discharges, releases or threatened releases of Hazardous Material into the
environment (including without limitation, ambient air, surface water,
groundwater, land surface or subsurface), or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, generation,
disposal, transport or handling of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes (hereinafter collectively
referred to as "Environmental Laws").
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7.1.10.4 Seller has not been subject
to any civil, criminal or administrative action, suit, claim, hearing, notice
of violation, investigation, inquiry or proceeding for failure to comply with,
or received notice of any violation or potential liability under the
Environmental Laws in respect of the Premises.
7.1.10.5 To the best of Seller's
knowledge, the Premises are not (a) listed or proposed for listing on the
National Priority List or (b) listed on the Comprehensive Environmental
Response, Compensation, Liability Information System List ("CERCLIS")
promulgated pursuant to CERCLA, 42 U.S.C. ' 9601(9), or any comparable list
maintained by any foreign, state or local government authority.
7.1.10.6 To the best of Seller's
knowledge, there are no underground storage tanks at the Premises other than
as disclosed on the Phase I environmental report commissioned by the Purchaser
in connection with this transaction and Seller further warrants and represents
that any prior use and operation of underground storage tanks by Seller has
been in compliance with all Environmental Laws.
7.1.11 Tax Proceedings. There are no proceedings pending
regarding the reduction of real estate taxes or assessments in respect of the
Premises.
7.1.12 Utilities. All water, storm and sanitary sewer,
gas, electricity, telephone and other utilities adequately service the
Premises, enter the Premises through lands as to which valid public or private
easements exist that will inure to the benefit of Purchaser and the Premises
are furnished utilities by facilities of public utilities and the cost of
installation of such utilities has been fully paid.
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7.1.13 Access. To the best of Seller's knowledge, there
are no federal, state, county, municipal or other governmental plans to change
the highway or road system in the vicinity of the Premises which could
materially restrict or change access from any such highway or road to the
Premises or any pending or threatened condemnation or eminent domain
proceedings relating to or affecting the Premises. All roads bounding the
Premises are public roads and the Lease is the only instrument necessary to
convey to Purchaser full access to and the right to use such roads freely, as
well as to convey all rights appurtenant to the Premises in such roads.
7.1.14 Insurance Requirements. All requirements or
recommendations by any insurer or by any board of fire underwriters or similar
body in respect of the Property have been satisfied.
7.1.15 Litigation. There is no action or proceeding
(zoning or otherwise) or governmental investigation pending, or, to the best
of Seller's knowledge, threatened against, or relating to, Seller (insofar as
it relates to the Premises or the Business), the Premises, the Business or the
transactions contemplated by this Agreement, nor is there any basis for any
such action, proceeding or investigation.
7.1.16 Assessments. There are no special or other
assessments for public improvements or otherwise now affecting the Premises
nor does Seller know of (a) any pending or threatened special assessments
affecting the Premises or (b) any contemplated improvements affecting the
Premises that may result in special assessments affecting the Premises.
7.1.17 Employee Agreements. There are no union or
employment contracts or agreements (written or oral) involving employees of
Seller or its affiliates
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affecting the Property or the Business which will survive the Closing. All
employees of Seller will have been terminated as of the date hereof.
7.1.18 Work at the Premises. No services, material or
work have been supplied to the Premises for which payment has not been made in
full.
7.1.19 Financial Condition. Seller has delivered to
Purchaser, true and correct copies of audited financial statements consisting
of balance sheets and income statements of Seller as of December 31, 1996.
Seller has delivered true and correct copies of monthly internal reports for
the months of January and February, 1997. Each such balance sheet presents
fairly the financial condition, assets and liabilities of Seller as of its
date; each such statement of income presents fairly the results of operations
of Seller for the period indicated. The financial statements referred to in
this Section are in accordance with the books and records of Seller. Since
December 31, 1996: (a) there has at no time been a material adverse change in
the financial condition, results of operations, businesses, properties,
assets, liabilities or future prospects of Seller, the Property, the Premises
or Business; (b) the Business has been conducted in all respects only in the
ordinary course; and (c) Seller has not suffered an extraordinary loss
(whether or not covered by insurance) or waived any right of substantial
value.
7.1.20 Full Disclosure. None of the information supplied
by Seller herein or in the exhibits hereto contains any untrue statement of a
material fact or omits to state a material fact required to be stated herein
or necessary in order to make the statements herein, in light of the
circumstances under which they are made, not misleading.
7.2 Representations and Warranties of Purchaser.
Purchaser hereby represents and warrants to Seller as follows:
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7.2.1 Organization; Power and Authority. Purchaser is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, and has all requisite power and authority to
carry on its business as it is now being conducted, to execute, deliver and
perform its obligations under this Agreement and to consummate the
transactions contemplated hereby.
7.2.2 Due Authorization and Execution; Effect of
Agreement. The execution, delivery and performance by Purchaser of this
Agreement and the consummation by Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate action required to
be taken on the part of Purchaser. This Agreement has been duly and validly
executed and delivered by Purchaser and constitutes the valid and binding
obligation of Purchaser, enforceable in accordance with its terms. The
execution, delivery and performance by Purchaser of this Agreement and the
consummation by Purchaser of the transactions contemplated hereby will not,
with or without the giving of notice or the lapse of time, or both, (a)
violate any provision of any law, rule or regulation to which Purchaser is
subject; (b) violate any order, judgment or decree applicable to Purchaser; or
(c) conflict with or result in a breach of or a default under any term or
condition of Purchaser's Certificate of Incorporation or By-Laws or any
agreement or other instrument to which Purchaser is a party or by which it or
its assets may be bound, except in each case, for violations, conflicts,
breaches or defaults which in the aggregate would not materially hinder or
impair the consummation of the transactions contemplated hereby.
7.3 Survival. The representations and warranties of the
parties made in this Article 7 shall survive the Closing.
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8. Further Assurances. At any time and from time to time after the
Closing, Seller shall, at the request of Purchaser, execute and deliver any
further instruments or documents and take all such further action as Purchaser
may reasonably request in order to transfer into the name of Purchaser any and
all Property contemplated to be sold pursuant to this Agreement and to further
consummate the transactions contemplated by this Agreement. This Article shall
survive the Closing.
9. Brokers. Seller and Purchaser warrant and represent to each
other that they dealt with no broker, finder or similar agent or party who or
which might be entitled to a commission or compensation on account of
introducing the parties, the negotiation or execution of this Agreement and/or
the closing of the transaction provided for herein other than Xx. Xxxxx
Xxxxxxx and Blue Sky Commercial (the "Brokers"). Seller agrees to pay the
Brokers any and all fees and commissions due to the Brokers in connection with
this transaction. Purchaser and Seller hereby respectively agree to indemnify
and hold harmless the other party from and against all loss, liability, damage
and expense (including, without limitation, attorneys' fees) imposed upon or
incurred by the other party by reason of any claim for commissions or other
compensation for bringing about this transaction by any broker, finder or
similar agent or party (other than the Brokers) who claims to have dealt with
the indemnifying party in connection with this transaction. The provisions of
this Article shall survive the Closing or any termination of this Agreement.
10. Costs and Fees. Documentary stamps or conveyancing taxes, if
any, shall be payable by Seller, and in no event be payable by Purchaser.
Purchaser shall pay the expenses incurred in connection with (a) the
examination of title, and (b) a survey of the Property. Any other similar
costs not expressly provided for elsewhere in this Agreement shall be divided
and borne in
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accordance with the usual practices in the jurisdiction where the Premises are
located. The provisions of this Article shall survive the Closing.
11. Indemnification.
11.1 Subject to the further provisions of this Article,
Seller shall protect, defend, hold harmless and indemnify Purchaser, its
officers, directors, shareholders, employees, agents and affiliates, and their
respective successors and assigns, from, against and in respect of any and all
losses, liabilities, deficiencies, penalties, fines, costs, damages and
expenses whatsoever (including without limitation, reasonable professional
fees and costs of investigation, litigation, settlement, and judgment and
interest) ("Losses") that may be suffered or incurred by any of them arising
from or by reason of (i) any Retained Liability or other liability or
obligation of Seller which is not an Assumed Liability; (ii) the breach of any
representation, warranty, covenant or agreement of Seller contained in this
Agreement or in any document or other writing delivered pursuant to this
Agreement (determined for this purpose as if all reference to knowledge and
materiality contained in Section 7 are deleted); and (iii) any and all
actions, suits, proceedings, claims, demands, assessments, judgments, costs
and expenses (including without limitation, interest, penalties, reasonable
legal fees and accounting fees) incident to the foregoing and the enforcement
of the provisions of this Section 11.1.
11.2 Subject to the further provisions of this Article,
Purchaser shall protect, defend, hold harmless and indemnify Seller, its
officers, directors, shareholders, affiliates, employees and agents, and its
successors and assigns from, against and in respect of any and all Losses that
may be suffered or incurred by any of them arising from or by reason of (i)
any of the Assumed Liabilities on and after the date hereof, (ii) the breach
of any representation, warranty,
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covenant or agreement of Purchaser contained in this Agreement or in any
document or other writing delivered pursuant to this Agreement (determined for
this purpose as if all references to knowledge and materiality contained in
Section 7 are deleted); and (iii) any and all actions, suits, proceedings,
claims, demands, assessments, judgments, costs and expenses (including without
limitation, interest, penalties, reasonable legal fees and accounting fees)
incident to the foregoing and the enforcement of the provisions of this
Section 11.2.
11.3 Whenever a party hereto (such party and each of its
affiliates which is entitled to indemnification pursuant to any provision of
this Agreement, an "Indemnified Party") shall learn after the Closing of a
claim that, if allowed (whether voluntarily or by judicial or quasi judicial
tribunal or agency), would give rise to an obligation of another party (the
"Indemnifying Party") to indemnify the Indemnified Party under any provision
of this Agreement, before paying the same or agreeing thereto, the Indemnified
Party shall promptly notify the Indemnifying Party in writing of all such
facts within the Indemnified Party's knowledge with respect to such claim and
the amount thereof (a "Notice of Claim"). If, prior to the expiration of
thirty (30) days from the mailing of a Notice of Claim, the Indemnifying Party
shall request, in writing, that such claim not be paid, the Indemnified Party
shall not pay the same, provided the Indemnifying Party proceeds promptly, at
its or their own expense (including employment of counsel reasonably
satisfactory to the Indemnified Party), to settle, compromise or litigate, in
good faith, such claim. After notice from the Indemnifying Party requesting
the Indemnified Party not to pay such claim and the Indemnifying Party's
assumption of the defense of such claim at its or their expense, the
Indemnifying Party shall not be liable to the Indemnified Party for any legal
or other expense subsequently incurred by the Indemnified Party in connection
with the defense thereof. However,
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the Indemnified Party shall have the right to participate at its expense and
with counsel of its choice in such settlement, compromise or litigation. The
Indemnified Party shall not be required to refrain from paying any claim which
has matured by a court judgment or decree, unless an appeal is duly taken
therefrom and execution thereof has been stayed, nor shall the Indemnified
Party be required to refrain from paying any claim where the delay in paying
such claim would result in the foreclosure of a lien upon any of the property
or assets then held by the Indemnified Party. The failure to provide a timely
Notice of Claim as provided in this Section 11.3 shall not excuse the
Indemnifying Party from its or their continuing obligations hereunder;
however, the Indemnified Party's claim shall be reduced by any damages to the
Indemnifying Party resulting from the Indemnified Party's delay or failure to
provide a Notice of Claim as provided in this Section 11.3.
11.4 For purposes of this Article, any assertion of fact
and/or law by a third party that, if true, would constitute a breach of a
representation or warranty made by a party to this Agreement or make
operational an indemnification obligation hereunder, shall, on the date that
such assertion is made, immediately invoke the Indemnifying Party's obligation
to protect, defend, hold harmless and indemnify the Indemnified Party pursuant
to this Article.
11.5 The obligations of Seller under Section 11.1 shall
be satisfied first from the Escrow Account and, if the Escrow Account is
inadequate to provide indemnification to Purchaser, then from Seller directly.
12. Bulk Sales. The parties agree to waive the requirements, if any,
of all applicable bulk sales laws. As an inducement to Purchaser to enter into
such waiver, Seller represents and warrants that (a) it will not be rendered
insolvent by the transactions contemplated by this Agreement, (b) all debts,
obligations and liabilities relating to the Property and Business that are not
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expressly assumed by Purchaser under this Agreement will be promptly paid and
discharged by Seller as and when they become due, and (c) the sale of the
Property pursuant to this Agreement does not constitute a "bulk sale" within
the meaning of applicable law. Seller agrees to indemnify and hold Purchaser
harmless from, and reimburse Purchaser for, any loss, cost, expense, liability
or damage which Purchaser may suffer or incur by virtue of the noncompliance
by Seller or Purchaser with any law pertaining to fraudulent conveyance, bulk
sales or any similar law which might make the sale or transfer of any part of
the Property or Business ineffective as to creditors of or claimants against
Seller.
13. Notices. All notices, demands, requests, consents or other
communications ("Notices") which either party may desire or be required to
give to the other hereunder shall be in writing and shall be delivered by
hand, overnight express carrier, or sent by registered or certified mail,
return receipt requested, postage prepaid, in either event, addressed to the
parties at their respective addresses first above set forth. A copy of any
Notice given by Seller to Purchaser shall simultaneously be given in either
manner provided above to Family Golf Centers, Inc., 000 Xxxxxxxxxxx Xxxx,
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxxxx, Esq., General
Counsel. A copy of any Notice given by Purchaser to Seller shall be sent to it
at 0000 Xxxxxxxxxxx Xxxx, Xxxxxxx, Xxxxx Xxxxxxxx 00000, and simultaneously be
given in either manner provided above to Xxxxxxxx, Xxxxxx & Xxxxxxx, X.X.X.,
Xxxxxxxxxxxx Xxxxx, Xxxxx 000, 000 Xxxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx
Xxxxxxxx 00000-0000, Attention: Xxxxxxx X. Xxxxxxx, Esq. Notices given in the
manner aforesaid shall be deemed to have been given three (3) business days
after the day so mailed, the day after delivery to any overnight express
carrier and on the day so delivered by hand. Either party shall have the right
to change its address(es) for the receipt of
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Notices by giving Notice to the other party in either manner aforesaid. Any
Notice required or permitted to be given by either party may be given by that
party's attorney.
14. Miscellaneous.
14.1 This Agreement shall bind and inure to the benefit of
the parties hereto and their respective successors and assigns. Each of the
individuals comprising Seller shall be jointly and severally liable for each
and every covenant, agreement, obligation, representation and warranty of
Seller hereunder.
14.2 The parties agree to submit any unresolved disputes
under this Agreement to non-binding mediation to be conducted in accordance
with the rules governing mediated settlement conferences in Superior Court as
promulgated, from time-to-time, by the North Carolina Supreme Court. Such
mediation shall take place in Raleigh, North Carolina.
14.3 This Agreement shall be governed by, interpreted under
and construed and enforced in accordance with, the laws of the State of North
Carolina.
14.4 The captions or article headings in this Agreement are
for convenience only and do not constitute part of this Agreement.
14.5 This Agreement has been fully negotiated by the parties
and rules of construction construing ambiguities against the party responsible
for drafting agreements shall not apply.
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14.6 It is agreed that, except where otherwise expressly
provided in particular Articles or Sections of this Agreement, none of the
provisions of this Agreement shall survive the Closing.
14.7 This Agreement (including the Exhibits annexed hereto)
contains the entire agreement between the parties with respect to the subject
matter hereof and supersedes all prior understandings, if any, with respect
thereto.
14.8 This Agreement may not be modified, changed,
supplemented or terminated, nor may any obligations hereunder be waived,
except by written instrument signed by the party to be charged or by its agent
duly authorized in writing or as otherwise expressly permitted herein.
14.9 No waiver of any breach of any agreement or provision
herein contained shall be deemed a waiver of any preceding or succeeding
breach thereof or of any other agreement or provision herein contained. No
extension of the time for performance of any obligations or acts shall be
deemed an extension of the time for performance of any other obligations or
acts.
14.10 This Agreement may be executed in one or more
counterparts, each of which when so executed and delivered shall be deemed an
original, but all of which taken together shall constitute but one and the
same original.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
CAROLINA CAPITAL VENTURES, LTD.
By:______________________
Name:
Title:
RALEIGH FAMILY GOLF CENTERS, INC.
By: _____________________
Name:
Title:
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EXHIBIT F
PERMITTED EXCEPTIONS
1. Taxes for 1997, not yet due and payable.
2. Deed of Trust from Carolina Capital Ventures, Ltd., to Xxxxxxxx X.
Xxxxxxx, Trustee, for the benefit of United Carolina Bank, recorded in
Book 4697, Page 725, Wake County Registry.
3. Rights of tenants in possession under unrecorded lease of less than one
(1) year's duration.
4. Joint Access Easement with Provision for Maintenance by and between
Carolina Capital Ventures, Ltd., and Janko Import Cars, Inc., recorded in
Book 5062, Page 747, Wake County Registry.
5. Right of Way to Carolina Power & Light Company, recorded in Book 4743,
Page 189, Wake County Registry.
6. UCC-1 Financing Statement bearing File Number 90-15732, evidencing
Carolina Capital Ventures, Ltd., as Debtor, and United Carolina Bank, as
Secured Party, and continued by UCC-3 Financing Statement bearing File
Number 95-09405, both filed in the Wake County Registry.
7. UCC-1 Financing Statement bearing File Number 675085, evidencing Carolina
Capital Ventures, Ltd., as Debtor, and United Carolina Bank, as Secured
Party, and continued by UCC-3 Financing Statement bearing File Number
1192146, both filed in the North Carolina Secretary of State.
8. Option Agreement by and between Carolina Capital Ventures, Ltd. And
Xxxxxxx X. Xxxxxxx, dated March 12, 1997.
* Items 2, 6 and 7 shall be removed as soon as practicable after Closing.
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