AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of September 29, 1999
(this "Agreement"), by and among F.S. Convenience Stores, Inc., a Florida
corporation ("FSCI"), United Petroleum Corporation, a Delaware corporation (the
"Company") and Chapter 11 debtor-in-possession, in case No. 99-88 (PJW) (the
"Chapter 11 Case"), pending in the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court"), and United Petroleum Subsidiary,
Inc., a Delaware corporation ("UPC Merger Sub").
WHEREAS, on July 23, 1999, the Company filed with the Bankruptcy
Court its second amended chapter 11 reorganization plan (the "Chapter 11 Plan");
WHEREAS, pursuant to this Agreement and the Chapter 11 Plan, UPC
Merger Sub shall acquire FSCI;
WHEREAS, to complete such acquisition, the Company, UPC Merger
Sub, and FSCI propose the merger of FSCI with and into UPC Merger Sub (the
"Merger") in a forward triangular merger, such that the holders (collectively,
the "FSCI Shareholder") of FSCI's capital stock (the "FSCI Common Stock") will
receive certain common and preferred stock of the reorganized Company, and $3
Million in cash, pursuant to and subject to the terms and conditions of this
Agreement and the Chapter 11 Plan;
WHEREAS, on the Effective Date of the Chapter 11 Plan, each share
of the Company's common stock then issued and outstanding shall be canceled,
annulled and extinguished; and
WHEREAS, on the Effective Date, the Company shall be authorized
to issue 10,000,000 shares of New UPC Common Stock and 300,000 shares of New UPC
Preferred Stock,
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants, representations, warranties and agreements herein contained,
and other good and valuable considerations, the receipt and adequacy of which
are hereby conclusively acknowledged, the parties hereto, intending to be
legally bound, agree as follows:
ARTICLE I
THE MERGER AND RELATED MATTERS
Section 1.1 The Merger.
(a) Subject to the terms and conditions of this Agreement,
at the time of the Closing, a certificate of merger (the "Certificate of
Merger") shall be duly prepared, executed and acknowledged by FSCI and UPC
Merger Sub in accordance with the Delaware General Corporation Law, 8 Del. C.
Section 101 et seq. (the "DGCL"). The Certificate of Merger and any certificate
required to effect the Merger under the applicable provisions of Florida law
shall be filed on the Closing Date with the Secretary of State of the State of
Delaware and the Secretary of State of the State of Florida, respectively. The
Merger shall become effective upon the filing of the Certificate of Merger with
the Secretary of State of the State of Delaware in accordance with the
provisions and requirements of the DGCL. The date and time when the Merger shall
become effective is hereinafter referred to as the "Effective Date" or
"Effective Time."
(b) At the Effective Time, FSCI shall be merged with and
into UPC Merger Sub, the separate corporate existence of FSCI shall cease, and
UPC Merger Sub shall continue as the surviving corporation under the laws of the
State of Delaware (the "Surviving Corporation").
(c) From and after the Effective Time, the Merger shall have
the effects set forth in section 259 of the DGCL.
Section 1.2 Consideration. At the Effective Time, the FSCI
Shareholder shall, by virtue of the Merger and without any action on the part of
the FSCI Shareholder, in exchange for the surrender to the Company of all
outstanding shares of FSCI Common Stock, receive (i) 2,400,000 fully paid and
nonassessable shares of New UPC Common Stock (as defined in Section 2.2(c)
hereof), (ii) 70,000 shares of New UPC Preferred Stock (as defined in Section
2.2(c) hereof), and (iii) cash in the amount of three million dollars
($3,000,000.00)(collectively, the "Merger Consideration").
Section 1.3 Certificate of Incorporation of the Surviving
Corporation. The certificate of incorporation of UPC Merger Sub, in
substantially the form attached as Exhibit A, shall be the certificate of
incorporation of the Surviving Corporation (the "Certificate of Incorporation").
Section 1.4 Bylaws of the Surviving Corporation. The bylaws of
UPC Merger Sub, in substantially the form attached as Exhibit B, shall be the
bylaws of the Surviving Corporation ("Bylaws").
Section 1.5 Directors and Officers of the Surviving Corporation.
At the Effective Time, the directors set forth in Schedule 1.5 shall be the
directors of the Company and the Surviving Corporation, each of such directors
to hold office, subject to the applicable provisions of the Certificate of
Incorporation and Bylaws of the Company or the Surviving Corporation, as
applicable, until the next annual stockholders' meeting of the Company or the
Surviving Corporation, as applicable, and until their respective successors
shall be duly elected or appointed and qualified. At the Effective Time, the
officers described in Schedule 1.5 , subject to the applicable provisions of the
Certificate of Incorporation and Bylaws of the Company or the Surviving
Corporation, as appropriate, shall be the officers of the Company and the
Surviving Corporation, as applicable until their respective successors shall be
duly elected or appointed and qualified.
Section 1.6 Closing. The Closing of the Merger shall take place
at the offices of White & Case LLP, 000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000,
Xxxxx, Xxxxxxx, or, at the option of the lender providing the Merger Financing
at the offices of the lender or counsel to such lender, as soon as practicable
after the last of the conditions set forth in Article V hereof is fulfilled or
waived but in no event later than 5:00 p.m., prevailing Eastern Time, on October
15, 1999, or at such other time and place and on such other date as FSCI, UPC
Merger Sub and the Company shall mutually agree (the "Closing Date").
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the Company and UPC
Merger Sub. Except as may be otherwise disclosed in the Company Disclosure
Schedule, attached or to be attached and initialed by all parties hereto, the
Company and UPC Merger Sub hereby represent and warrant to FSCI as follows:
(a) Due Organization, Good Standing and Corporate Power.
Except as disclosed in Schedule 2.1(a) hereto, each of the Company and its
subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and each such
corporation has all requisite corporate power and authority to own, lease and
operate its properties and to carry on its business as now being conducted. Each
of the Company and its subsidiaries is duly qualified or licensed to do business
and is in good standing in each jurisdiction in which the property owned, leased
or operated by it or the nature of the business conducted by it makes such
qualification necessary, except in such jurisdictions where the failure to be so
qualified or licensed and in good standing would not have a material adverse
effect on the business, properties, assets, liabilities, operations, results of
operations, condition (financial or otherwise) (collectively, the "Condition")
of the Company and its subsidiaries taken as a whole. The certificate of
incorporation and bylaws of the Company, as amended and to be in effect as of
the Effective Time, shall be substantially in the form attached hereto as
Exhibit C.
(b) Authorization and Validity of Agreement. Subject to the
entry of the Confirmation Order and the occurrence of the Effective Date of the
Chapter 11 Plan, the Company and UPC Merger Sub have full corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions and enter into the agreements contemplated hereby. The execution,
delivery and performance of this Agreement by the Company and UPC Merger Sub,
and the consummation by them of the transactions contemplated hereby, have been
duly authorized and approved by their respective Boards of Directors and,
subject to the entry of the Confirmation Order and the occurrence of the
Effective Date of the Chapter 11 Plan, (i) no other corporate action on the part
of the Company or UPC Merger Sub is necessary to authorize the execution,
delivery and performance of this Agreement by the Company and UPC Merger Sub and
the consummation of the transactions contemplated hereby, and (ii) this
Agreement will constitute a valid and binding obligation of the Company and UPC
Merger Sub enforceable against the Company and UPC Merger Sub in accordance with
its terms. Subject to the entry of the Confirmation Order and the occurrence of
the Effective Date of the Chapter 11 Plan, this Agreement has been duly executed
and delivered by the Company and UPC Merger Sub.
(c) Capitalization.
(i) Upon the Effective Date of the Chapter 11 Plan, the
authorized capital stock of the Company will consist of 10,000,000 shares of
common stock ("New UPC Common Stock"), 5,000,000 of which shall be issued and
outstanding, and 300,000 shares of preferred stock, par value $100 per share
("New UPC Preferred Stock"), 140,000 shares of which shall be issued and
outstanding. The authorized capital stock of UPC Merger Sub will consist of
three thousand (3,000) shares of common stock, all of which shall be issued to
and owned by the Company. New UPC Common Stock and New UPC Preferred Stock, when
issued in accordance with the Chapter 11 Plan and this Agreement, (A) will be
duly authorized, validly issued, fully paid and nonassessable, (B) will not be
subject to, nor issued in violation of, any preemptive rights, and (C) will be
free and clear of all liens, proxies, voting trusts, encumbrances, options or
claims whatsoever. The holders of the New UPC Preferred Stock will have all of
the powers, preferences and rights as set forth in the preference certificate.
(ii) Schedule 2.1(c)(ii) lists all of the Company's
subsidiaries. All of the outstanding shares of capital stock of each of the
Company's subsidiaries have been duly authorized and validly issued, are fully
paid and nonassessable, are not subject to, nor were they issued in violation
of, any preemptive rights, and are owned, of record and beneficially, by the
Company, free and clear of all liens, encumbrances, options or claims
whatsoever. Except as contemplated by this Agreement, no shares of capital stock
of the Company or any of the Company's subsidiaries are reserved for issuance
and there are no outstanding or authorized options, warrants, rights,
subscriptions, claims of any character, agreements, obligations, convertible or
exchangeable securities, or other commitments, contingent or otherwise, relating
to the capital stock of the Company or any subsidiary of the Company, pursuant
to which the Company or such subsidiary is or may become obligated to issue any
shares of capital stock of the Company or such subsidiary or any securities
convertible into, exchangeable for, or evidencing the right to subscribe for,
any shares of the Company or such subsidiary. There are no restrictions of any
kind that prevent the payment of dividends by any of the Company's subsidiaries.
Except for the subsidiaries listed on Schedule 2.1(c)(ii), the Company does not
own, directly or indirectly, any capital stock or other equity interest in any
Person or have any direct or indirect equity or ownership interest in any Person
and neither the Company nor any of its subsidiaries is subject to any obligation
or requirement to provide funds for or to make any investment (in the form of a
loan, capital contribution or otherwise) to or in any Person.
(d) Consents and Approvals; No Violations. Assuming that
filings required under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), are made and the waiting period thereunder has been
terminated or has expired, the filing of the Certificate of Merger and other
appropriate merger documents, if any, as required by the DGCL or under the
applicable provisions of Florida law, are made, the Bankruptcy Court enters an
order, that may be the Confirmation Order, approving the Merger and this
Agreement, and subject to the receipt of those consents and approvals identified
in Schedule 2.1(d), the execution and delivery of this Agreement by the Company
and UPC Merger Sub and the consummation by the Company and UPC Merger Sub of the
transactions contemplated hereby will not: (i) violate any provision of the
certificate of incorporation of the Company or UPC Merger Sub or the bylaws of
the Company or UPC Merger Sub, each as in effect as of the Effective Time; (ii)
violate any statute, ordinance, rule, regulation, order or decree of any court
or of any governmental or regulatory body, agency or authority applicable to the
Company or UPC Merger Sub or by which any of their respective properties or
assets may be bound; (iii) require any filing with, or permit, consent or
approval of, or the giving of any notice to, any governmental or regulatory
body, agency or authority; or (iv) result in a violation or breach of, conflict
with, constitute (with or without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of the Company or any
of its subsidiaries under, any of the terms, conditions or provisions of any
note, bond, mortgage, indenture, license, franchise, permit, agreement, lease,
franchise agreement or other instrument or obligation to which the Company or
any of its subsidiaries is a party, or by which it or any of their respective
properties or assets may be bound, excluding from the foregoing clauses (iii)
and (iv) filings, notices, permits, consents and approvals the absence of which,
and violations, breaches, defaults, conflicts and liens that, in the aggregate,
would not have a material adverse effect on the Condition of the Company and its
subsidiaries taken as a whole; or (v) trigger any consent or approval
requirements with respect to those leases, licenses, permits, or approvals held
by the Company.
(e) Company Reports and Financial Statements. Except as set
forth in Schedule 2.1(e), since December 31, 1996, the Company has filed all
forms, reports and documents, together with all exhibits and amendments thereto
with the Securities and Exchange Commission (the "Commission") required to be
filed by it pursuant to the federal securities laws and the Commission rules and
regulations thereunder, and all such forms, reports and documents filed by the
Company with the Commission (collectively, the "Commission Filings") have
complied in all material respects with all applicable requirements of the
federal securities laws and the Commission rules and regulations promulgated
thereunder. The Company has heretofore delivered to FSCI true and complete
copies of all Commission Filings since December 31, 1996. As of their respective
filing dates, the Commission Filings did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. Each of the consolidated balance sheets as
of the end of the fiscal years ended December 31, 1997 and 1998 and the
consolidated statements of operations, consolidated statements of stockholders'
equity and consolidated statements of changes in financial position for the
fiscal years ended December 31, 1997 and 1998 included in the Commission
Filings, were prepared in accordance with generally accepted accounting
principles (as in effect from time to time) applied on a consistent basis
(except as may be indicated therein or in the notes or schedules thereto) and
fairly present in all material respects the consolidated financial position of
the Company and its consolidated subsidiaries as of the dates thereof and the
results of their operations and changes in financial position for the periods
then ended.
(f) Minute Books. The minute books of the Company and its
material subsidiaries, as previously made available to FSCI and its
representatives, contain accurate records of all meetings of and corporate
actions or written consents by the stockholders and Boards of Directors of the
Company and its material subsidiaries since January 1, 1996.
(g) Title to Properties; Encumbrances; Facilities.
(i) The Company and each of its subsidiaries has good,
valid and marketable title to (A) all its material tangible properties and
assets (real and personal), including, without limitation, all the properties
and assets reflected in the consolidated balance sheet as of December 31, 1998
included in the Disclosure Statement (the "Balance Sheet") except as indicated
in the notes thereto and except for properties and assets reflected in the
Balance Sheet that have been sold or otherwise disposed of in the ordinary
course of business, and (B) all the tangible properties and assets purchased by
the Company and any of its subsidiaries since December 31, 1998 except for such
properties and assets that have been sold or otherwise disposed of in the
ordinary course of business; in each case subject to no encumbrance, lien,
charge or other restriction of any kind or character, except for (I) liens
pertaining to indebtedness reflected in the Balance Sheet and described on
Schedule 2.1(g), (II) liens consisting of zoning or planning restrictions,
easements, permits and other restrictions or limitations on the use of real
property or irregularities in title thereto that do not materially detract from
the value of, or impair the use of, such property by the Company or any of its
subsidiaries in the operation of its respective business, (III) liens for
current taxes, assessments or governmental charges or levies on property not yet
due and delinquent, and (IV) statutory landlord's liens, liens granted to
landlords under leases for the Company Facilities, and fee mortgages made by
such landlords.
(ii) Schedule 2.1(g) sets forth a list of all Company
Facilities now being occupied by the Company or any of its subsidiaries or used
in connection with their respective operations. The Company Facilities are all
premises leased or owned by the Company or any of its subsidiaries. Neither the
Company nor any of its subsidiaries has received notice of any building or
health code violations with respect to any of the Company Facilities. Each of
the Company and its subsidiaries has complied with all federal, state and local
laws, ordinances, rules and regulations applicable to each Company Facility,
except where the failure to so comply would not have a material adverse effect
on the Condition of the Company and its subsidiaries. There is no pending,
proposed, or, to the Company's knowledge, threatened condemnation, eminent
domain, or similar proceeding affecting any of the Company Facilities.
(h) Compliance with Laws. The Company and its subsidiaries
are in compliance with all applicable laws, regulations, orders, judgments and
decrees except where the failure to so comply would not have a material adverse
effect on the Condition of the Company and its subsidiaries taken as a whole.
(i) Litigation. Except for the Chapter 11 Case and except as
specifically disclosed in Schedule 2.1(i), there is no action, suit, proceeding
at law or in equity, or any arbitration or any administrative or other
proceeding by or before (or, to the best knowledge, information and belief of
the Company, any investigation by) any governmental or other instrumentality or
agency, pending, or, to the best knowledge, information and belief of the
Company, threatened, against or affecting the Company or any of its
subsidiaries, or any of their properties or rights. There are no such suits,
actions, claims, proceedings or investigations pending or, to the best
knowledge, information and belief of the Company, threatened, seeking to prevent
or challenging the transactions contemplated by this Agreement. Except as
disclosed in the Disclosure Statement, neither the Company nor any of its
subsidiaries is subject to any judgment, order or decree entered in any lawsuit
or proceeding that could have a material adverse effect on the Condition of the
Company and its subsidiaries taken as a whole or on the ability of the Company
or any subsidiary to conduct its business as presently conducted. Schedule
2.1(i) sets forth all litigation involving the Company or its subsidiaries that
is pending or, to the Company's knowledge, threatened.
(j) Employee Benefit Plans.
(i) List of Plans. Set forth in Schedule 2.1(j)
attached hereto is an accurate and complete list of all employee benefit plans
("Employee Benefit Plans") within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), whether or not any
such Employee Benefit Plans are otherwise exempt from the provisions of ERISA,
established, maintained or contributed to by the Company or any of its
subsidiaries (including, for this purpose and for the purpose of all of the
representations in this Section 2.1(j)), all employers (whether or not
incorporated) that by reason of common control are treated together with the
Company as a single employer within the meaning of Section 414 of the Internal
Revenue Code of 1986, as amended (the "Code")).
(ii) Status of Plans. Neither the Company nor any of
its subsidiaries maintains any Employee Benefit Plans subject to ERISA.
(iii) Contributions. Full payment has been made of all
amounts that the Company or any of its subsidiaries is required, under
applicable law or under any Employee Benefit Plan or any agreement relating to
any Employee Benefit Plan to which the Company or any of its subsidiaries is a
party, to have paid as contributions thereto as of the last day of the most
recent fiscal year of such Employee Benefit Plan ended prior to the date hereof.
The Company has made adequate provision for reserves to meet contributions that
have not been made because they are not yet due under the terms of any Employee
Benefit Plan or related agreements. Benefits under all Employee Benefit Plans
are as represented and have not been increased subsequent to the date as of
which documents have been provided to FSCI.
(iv) [Intentionally Omitted]
(v) Tax Qualification. Each Employee Benefit Plan
intended to be qualified under Section 401(a) of the Code has been determined to
be so qualified by the Internal Revenue Service and nothing has occurred since
the date of the last such determination that resulted or is likely to result in
the revocation of such determination.
(vi) Transactions. No Reportable Event (as defined in
Section 4043 of ERISA) has occurred with respect to any Employee Benefit Plan
for which the 30-day notice requirement has not been waived by the Pension
Benefit Guaranty Corporation ("PBGC") and neither the Company nor any of its
subsidiaries has engaged in any transaction with respect to the Employee Benefit
Plans that would subject it to a tax, penalty or liability for prohibited
transactions under ERISA or the Code nor has any of their respective directors,
officers, or employees, to the extent they or any of them are fiduciaries with
respect to such Employee Benefit Plans, breached any of their responsibilities
or obligations imposed upon fiduciaries under Title I of ERISA or would result
in any claim being made under or by or on behalf of any such Employee Benefit
Plans by any party with standing to make such claim.
(vii) Other Plans. The Company currently does not
maintain any employee or non-employee benefit plans or any other foreign
pension, welfare or retirement benefit plans other than those listed in Schedule
2.1(k).
(viii) Documents. The Company has made available to
FSCI and its counsel true and complete copies of (A) all Employee Benefit Plans
as in effect, together with all amendments thereto that will become effective at
a later date, as well as the latest Internal Revenue Service determination
letter obtained with respect to any such Employee Benefit Plan qualified under
Section 401 or 501 of the Code and (B) Form 5500 for the most recent completed
fiscal year for each Employee Benefit Plan required to file such form.
(k) Employment Relations and Agreements. (i) Each of the
Company and its subsidiaries is in substantial compliance with all federal,
state or other applicable laws respecting employment and employment practices,
terms and conditions of employment and wages and hours, and has not and is not
engaged in any unfair labor practice; (ii) to the Company's knowledge, no unfair
labor practice complaint against the Company or any of its subsidiaries is
pending before the National Labor Relations Board; (iii) there is no labor
strike, dispute, slowdown or stoppage actually pending or, to the Company's
knowledge, threatened against or involving the Company or any of its
subsidiaries; (iv) no representation question exists respecting the employees of
the Company or any of its subsidiaries; (v) to the Company's knowledge, no
grievance that might have a material adverse effect on the Condition of the
Company and its subsidiaries as a whole or the conduct of their respective
businesses exists, no arbitration proceeding arising out of or under any
collective bargaining agreement is pending and no claim therefor has been
asserted; (vi) no collective bargaining agreement is currently in effect or
being negotiated by the Company or any of its subsidiaries; and (vii) neither
the Company nor any of its subsidiaries has experienced any material labor
difficulty during the last three years. There has not been, and to the best
knowledge of the Company, there will not be, any change in relations with
employees of the Company or any of its subsidiaries as a result of the
transactions contemplated by this Agreement that could have a material adverse
effect on the Condition of the Company and its subsidiaries or the Surviving
Corporation taken as a whole. Except as disclosed in Schedule 2.1(k) attached
hereto (which schedule lists the maximum payment that could be owed), there
exist no employment, consulting, severance or indemnification agreements between
the Company and any director, officer or employee of the Company or any
agreement that would give any Person the right to receive any payment from the
Company as a result of the Merger.
(l) Taxes. Except as provided in Schedule 2.1(l), the
Company has filed or caused to be filed, within the times and in the manner
prescribed by law (including permitted extensions of time to file), all federal,
state, local and foreign tax returns and tax reports that are required to be
filed by, or with respect to, the Company or any of its subsidiaries. All
federal, state, local and foreign income, profits, franchise, sales, use,
occupancy, excise and other taxes and assessments (including interest and
penalties) payable by, or due from, the Company or any of its subsidiaries (i)
have either been fully paid or will be fully paid under the Chapter 11 Plan to
the extent allowed as a Claim under the Chapter 11 Plan, and (ii) adequately
disclosed and fully provided for in the books and financial statements of the
Company and its subsidiaries. Except as provided in Schedule 2.1(l), the federal
income tax liability of the Company and its subsidiaries has been finally
determined for all fiscal years to and including the fiscal year ended December
31, 1996. No examination of any tax return of the Company or any of its
subsidiaries is currently in progress. There are no outstanding agreements or
waivers extending the statutory period of limitation applicable to any tax
return of the Company or any of its subsidiaries.
(m) Intellectual Properties. In the operation of its
business the Company and its subsidiaries have used, and currently use, domestic
and foreign patents, patent applications, patent licenses, software licenses,
know-how licenses, trade names, trademarks, copyrights, unpatented inventions,
service marks, trademark registrations and applications, service xxxx
registrations and applications, copyright registrations and applications, trade
secrets and other confidential proprietary information (collectively the
"Company Intellectual Property"). Schedule 2.1(m) attached hereto contains an
accurate and complete list of all Company Intellectual Property that is of
material importance to the operation of the business of the Company or any of
its subsidiaries. Unless otherwise indicated in Schedule 2.1(m) the Company (or
the subsidiary indicated) owns the entire right, title and interest in and to
the Company Intellectual Property listed on Schedule 2.1(m) used in the
operation of its business (including, without limitation, the exclusive right to
use and license the same) and each item constituting part of the Company
Intellectual Property that is owned by the Company or a subsidiary and listed on
Schedule 2.1(m) has been, to the extent indicated in Schedule 2.1(m), duly
registered with, filed in or issued by, as the case may be, the United States
Patent and Trademark Office or such other governmental entities, domestic or
foreign, as are indicated in Schedule 2.1(m) and such registrations, filings and
issuances remain in full force and effect. To the best knowledge of the Company,
except as stated in such Schedule 2.1(m), there are no pending or threatened
proceedings or litigation or other adverse claims affecting or with respect to
the Company Intellectual Property. Schedule 2.1(m) lists all notices or claims
currently pending or received by the Company or any of its subsidiaries during
the past two years that claim infringement, contributory infringement,
inducement to infringe, misappropriation or breach by the Company or any of its
subsidiaries of any domestic or foreign patents, patent applications, patent
licenses and know-how licenses, trade names, trademark registrations and
applications, service marks, copyrights, copyright registrations or
applications, trade secrets or other confidential proprietary information. To
the best knowledge of the Company, except as indicated on Schedule 2.1(m), no
Person is materially infringing the Company Intellectual Property.
(n) Broker's or Finder's Fee. No agent, broker, Person or
firm acting on behalf of the Company is, or will be, entitled to any fee,
commission or broker's or finder's fees from any of the parties hereto, or from
any Person controlling, controlled by, or under common control with any of the
parties hereto, in connection with this Agreement or any of the transactions
contemplated hereby.
(o) Accounts Receivable. The accounts receivable of the
Company and its subsidiaries as reflected in the Balance Sheet, to the extent
uncollected on the date of this Agreement, and the accounts receivable reflected
on the books of the Company are, on the basis of existing facts, valid and
existing, represent monies due for goods sold and delivered or services
rendered, and (subject to the aforesaid reserve) are subject to no refunds or
other adjustments (except for returns or discounts for prompt payment given in
the ordinary course of business) and to no defenses, rights of setoff,
assignments, restrictions, encumbrances or conditions enforceable by third
parties on or affecting any thereof.
(p) Inventories. The inventories reflected in the Balance
Sheet were, and those reflected on the books of the Company and its subsidiaries
since such date have been, determined and valued in accordance with generally
accepted accounting principles applied on a consistent basis as reflected in the
consolidated balance sheet, and existed on the respective dates. Except for
normal spoilage or obsolescence, the inventories of the Company and its
subsidiaries consist of items that are good and merchantable and are of a
quality and quantity presently usable or salable in the ordinary course of
business.
(q) Environmental Matters.
(i) The Company and each subsidiary is, and at all
times has been, in substantial compliance with, and has not been and is not in
violation of or liable under, any Environmental Law with respect to any of their
real properties, leaseholds or other real property interests owned or leased by
the Company or any of its subsidiaries, and any buildings, plants, structures,
or equipment (including motor vehicles), that are owned or leased both as of the
date hereof and as of the Closing Date ("Company Facilities"). Except for
matters covered by applicable state remediation programs, the Company and its
subsidiaries have not received any actual or threatened order, notice, or other
communication from (A) any governmental body or private citizen acting in the
public interest, or (B) the current or prior owner or operator of any Company
Facilities, of any actual or potential violation or failure to comply with any
Environmental Law, or of any actual or threatened obligation to undertake or
bear the cost of any Environmental, Health, and Safety Liabilities with respect
to any of the Company Facilities or any other properties or assets (whether
real, personal, or mixed) in which the Company or any of its subsidiaries has an
interest, or with respect to any Company Facility at or to which Hazardous
Materials were generated, manufactured, refined, transferred, imported, used, or
processed by the Company, any of its subsidiaries or any other Person for whose
conduct they are or may be held responsible, or from which Hazardous Materials
have been transported, treated, stored, handled, transferred, disposed,
recycled, or received.
(ii) There are no pending or, to the knowledge of the
Company, threatened claims, liens, or other restrictions of any nature,
resulting from any Environmental, Health, and Safety Liabilities or arising
under or pursuant to any Environmental Law, with respect to or affecting any of
the Company Facilities or any other properties and assets (whether real,
personal, or mixed) in which the Company and of its subsidiaries has an
interest.
(iii) Except for matters covered by any applicable
state remediation programs or applicable insurance policies, the Company and its
subsidiaries have not received any citation, directive, inquiry, notice, order,
summons, warning, or other communication that relates to Hazardous Activity,
Hazardous Materials, or any alleged, actual, or potential violation or failure
to comply with any Environmental Law, or of any alleged, actual, or potential
obligation to undertake or bear the cost of any Environmental, Health, and
Safety Liabilities with respect to any of the Company Facilities.
(iv) Except for matters covered by any applicable state
remediation programs or by applicable insurance policies, the Company and its
subsidiaries have no Environmental, Health, and Safety Liabilities with respect
to the Company Facilities or with respect to any other properties and assets
(whether real, personal, or mixed) in which the Company or any of its
subsidiaries (or any predecessor), has an interest, or at any property
geologically or hydrologically adjoining the Company Facilities or any such
other property or assets.
(v) Except for matters covered by any applicable state
remediation programs or by applicable insurance policies, there has been no
Release or, to the knowledge of the Company, threat of Release, of any Hazardous
Materials at or from the Company Facilities or, to the knowledge of the Company,
at any other locations where any Hazardous Materials were generated,
manufactured, refined, transferred, produced, imported, used, or processed from
or by the Company Facilities, or from or by any other properties and assets
(whether real, personal, or mixed) in which the Company or any of its
subsidiaries has an interest, or to the knowledge of the Company any
geologically or hydrologically adjoining property, whether by the Company, any
of its subsidiaries or any other Person.
(vi) The Company has made available to FSCI true and
complete copies and results of any reports, studies, analyses, tests, or
monitoring possessed or initiated by the Company or any of its subsidiaries
pertaining to Hazardous Materials or Hazardous Activities in, on, or under the
Company Facilities, or concerning compliance by the Company, any of its
subsidiaries, or any other Person for whose conduct they are or may be held
responsible, with Environmental Laws.
(r) Chapter 11 Proceedings. The Company has complied in all
material respects with the Bankruptcy Code, and with all other laws, rules,
regulations, decrees or orders applicable to or arising out of the Chapter 11
Case, except to the extent that any such non-compliance would not have a
material adverse affect on Condition of the Company. To the best of the
Company's knowledge, all lists of creditors and stockholders, schedules,
statements of affairs, and financial reports filed by the Company with the
Bankruptcy Court were complete and accurate in all material respects as of the
date filed or made. Such notice of the Chapter 11 Case as is required by the
Bankruptcy Code has been or will be given to all known holders of Claims (as
such term is defined in the Bankruptcy Code), and the Company shall serve notice
of the transactions contemplated by this Agreement on parties entitled to such
notice under the Bankruptcy Code, as modified by orders in respect of notice
that may be issued at any time and from time to time by the Bankruptcy Court.
(s) Absence of Certain Changes. Except as disclosed in
Schedule 2.1(s) hereto, since December 31, 1998: (i) there has not been any
material adverse change in the Condition of the Company and its subsidiaries,
taken as a whole; (ii) the businesses of the Company and its subsidiaries have
been conducted only in the ordinary course; (iii) the Company and its
subsidiaries have not incurred any material liabilities (direct, contingent or
otherwise) or engaged in any material transaction or entered into any material
agreement outside the ordinary course of business; (iv) the Company and its
subsidiaries have not increased the compensation of any officer or granted any
general salary or benefits increase to their employees other than in the
ordinary course of business; and (v) the Company and its subsidiaries have not
taken any action referred to in Section 3.4 hereof except as permitted or
required thereby.
(t) Material Contracts. Schedule 2.1(t) identifies all
material contracts, agreements and other written or oral arrangements to which
the Company or any of its subsidiaries is party and all arrangements that are
filed with the Commission as part of the Commission Filings. True, correct and
complete copies (with all amendments thereto) thereof have been made available
to FSCI. "Material" contracts, agreements and arrangements are those that
obligate the parties, in the aggregate, to in excess of $50,000 of obligations.
With respect to each written arrangement so listed: (i) the written arrangement
is legal, valid, binding, enforceable, and in full force and effect, and has not
been materially amended or altered; (ii) the Company and its subsidiaries are
not in breach or default, and no event has occurred that, with notice or lapse
of time, or both, would constitute a breach or default by the Company or its
subsidiaries or permit a party other than the Company or its subsidiaries to
terminate, modify, or accelerate performance under any such written arrangement;
and (iii) to the Company's knowledge, no party other than the Company or its
subsidiaries is in breach or default, and no event has occurred that, with
notice or lapse of time, or both, would constitute a breach or default or permit
termination, modification, or acceleration, under any such written arrangement.
(u) Liabilities. The Company and its subsidiaries have no
material outstanding claims, liabilities or indebtedness, contingent or
otherwise, required to be reflected in a financial statement prepared in
accordance with GAAP, except as set forth in the financial statements delivered
to FSCI, or referred to in the footnotes thereto, other than liabilities
incurred subsequent to December 31, 1998 in the ordinary course of business not
involving borrowings by the Company and its subsidiaries. Except for that
indebtedness and those obligations identified in the Disclosure Statement, the
Company and its subsidiaries are not in default in respect of the material terms
and conditions of any material indebtedness or other agreements. The Company
currently estimates that the allowed amount of such Claims will not exceed
$250,000. However, the Company has scheduled as disputed approximately $900,000
of unsecured claims and proofs of unsecured claims, which the Company likewise
disputes, have been filed totaling approximately $2,000,000. Although the
Company believes that all of the disputed scheduled and filed claims will
ultimately be disallowed by the Bankruptcy Court, there can be no assurance that
some or all of the disputed scheduled and filed claims will not be allowed by
the Bankruptcy Court.
Section 2.2 Representations and Warranties of FSCI. Except as may
be otherwise disclosed in the FSCI Disclosure Schedule, attached or to be
attached and initialed by the parties, FSCI represents and warrants to the
Company and UPC Merger Sub, as of the Effective Time, as follows:
(a) Due Organization; Good Standing and Corporate Power.
(i) FSCI and, as of the Effective Time, a subsidiary of
FSCI ("FSCI Sub") formed solely to serve as a partner in the REWJB Gas
Investments, a Florida general partnership (the "Gas Partnership"), Farm Stores
Grocery, Inc., a Delaware corporation in which FSCI will own as of the Effective
Time ten percent (10%) of the issued and outstanding stock ("FSG"), a subsidiary
of FSG ("FSG Sub") formed solely to serve as a partner in REWJB Investments, a
Florida general partnership (the "Drive-Thru Partnership" and, together with the
Gas Partnership, the "Partnerships"), are each corporations duly incorporated,
validly existing, and in good standing under the laws of their respective
jurisdictions of incorporation and have all requisite corporate power and
authority to own, lease and operate their respective properties and to carry on
their respective businesses as now being conducted. FSCI, FSCI Sub, FSG, and FSG
Sub are duly qualified or licensed to do business and are in good standing in
each jurisdiction in which the property owned, leased or operated by it or the
nature of the business conducted by it makes such qualification necessary,
except in such jurisdictions where the failure to be so qualified or licensed
and in good standing would not have a material adverse effect on the Condition
of FSCI, FSCI Sub, FSG, FSG Sub, as appropriate.
(ii) Each of the Partnerships has been duly formed and
is validly existing under the laws of the jurisdiction of its organization and
has all requisite power and authority to own, lease and operate its properties
and carry on its business as now being conducted. Each of the Partnerships is
duly qualified or licensed to do business and is in good standing in each
jurisdiction in which the property owned, leased or operated by each of the
Partnerships or the nature of the business conducted by the Partnerships makes
such qualification necessary, except in such jurisdictions where the failure to
be so qualified or licensed and in good standing would not have a material
adverse effect on the Condition of the Partnerships.
(b) Authorization and Validity of Agreement. FSCI has full
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions and enter into the
agreements contemplated hereby. The execution, delivery and performance of this
Agreement by FSCI, and the consummation of the transactions contemplated hereby,
has been duly authorized by the Board of Directors of FSCI. No other corporate
action on the part of FSCI is necessary to authorize the execution, delivery and
performance of this Agreement by FSCI and the consummation of the transactions
contemplated hereby (other than the approval of this Agreement by the FSCI
Shareholder). This Agreement has been duly executed and delivered by FSCI and is
a valid and binding obligation of FSCI, enforceable against FSCI in accordance
with its terms.
(c) Capitalization.
(i) The FSCI Common Stock is all of the authorized
capital stock of FSCI and consists of 10,000 shares of common stock. As of the
date hereof, (A) 10,000 shares of FSCI Common Stock are issued and outstanding,
(B) no shares of FSCI Common Stock are reserved for issuance pursuant to
outstanding options or stock incentive plans, (C) all issued and outstanding
FSCI Common Stock is owned by the FSCI Shareholder, and (D) no shares of FSCI
Common Stock are held in FSCI's treasury. All issued and outstanding shares of
FSCI Common Stock have been validly issued and are fully paid and nonassessable,
and are not subject to, nor were they issued in violation of, any preemptive
rights. Except as set forth in this Section 2.2(c), at the Effective Time, and
as contemplated by this Agreement, there will not be any outstanding or
authorized options, warrants, rights, subscriptions, claims of any character,
agreements, obligations, convertible or exchangeable securities, or other
commitments, contingent or otherwise, relating to FSCI Common Stock or any other
shares of capital stock of FSCI, pursuant to which FSCI is or may become
obligated to issue shares of FSCI Common Stock, any other shares of its capital
stock or any securities convertible into, exchangeable for, or evidencing the
right to subscribe for, any shares of the capital stock of FSCI.
(ii) The authorized capital stock of FSG consists of
10,000,000 shares of common stock ("FSG Common Stock"),of which, as of the
Effective Time, 1,000,000 will be issued (including 100,000 shares issued to
FSCI) and outstanding or reserved for issuance under options or warrants. Except
as set forth in the preceding sentence, (A) no shares of FSG Common Stock are
reserved for issuance pursuant to outstanding options or stock incentive plans,
(B) all issued and outstanding FSG Common Stock is owned beneficially by FSCI
and FSCI Shareholder, and (C) no shares of FSG Common Stock are held in FSG's
treasury. All issued and outstanding shares of FSG Common Stock have been
validly issued and are fully paid and nonassessable, and are not subject to, nor
were they issued in violation of, any preemptive rights. Except as set forth in
this Section 2.2(c), at the Effective Time, and as contemplated by this
Agreement, there will not be any outstanding or authorized options, warrants,
rights, subscriptions, claims of any character, agreements, obligations,
convertible or exchangeable securities, or other commitments, contingent or
otherwise, relating to FSG Common Stock or any other shares of capital stock of
FSG, pursuant to which FSG is or may become obligated to issue shares of FSG
Common Stock, any other shares of its capital stock or any securities
convertible into, exchangeable for, or evidencing the right to subscribe for,
any shares of the capital stock of FSG.
(iii) The interests in the Gas Partnership owned by
FSCI are fully paid and nonassessable, were issued by the Gas Partnership in
accordance with the Gas Partnership's partnership agreement dated September 9,
1992 ("Gas Partnership Agreement"), and are owned, of record and beneficially,
by FSCI free and clear of all liens and encumbrances. The partnership interests
owned by FSCI in the Gas Partnership constitute a forty percent (40%) interest
in the Gas Partnership. Except for those interests in the Gas Partnership owned
by Xxxx Gas & Food Stores, Inc., a Florida corporation, that are subject to
being and that will be purchased by FSCI immediately prior to the Effective
Time, there are no other outstanding interests in the Gas Partnership nor are
there any options, warrants, rights, subscriptions, claims of any character,
agreements, obligations, convertible or exchangeable securities, or other
commitments, contingent or otherwise, relating to interests in the Gas
Partnership pursuant to which the Gas Partnership is or may become obligated or
any Person is entitled to acquire any interest in the Gas Partnership or any
securities convertible into, exchangeable for, or evidencing the right to
subscribe for, any interest in the Gas Partnership. As of the Effective Time,
there will be no restrictions of any kind in the Gas Partnership Agreement that
prevent the payment of distributions by the Gas Partnership.
(iv) At the Effective time, the interests in the
Drive-Thru Partnership owned by FSG and FSG Sub will be fully paid and
nonassessable, will be issued by the Drive-Thru Partnership in accordance with
the Drive-Thru Partnership's partnership agreement dated September 9, 1992
("Drive-Thru Partnership Agreement"), and will be owned, of record and
beneficially, by FSG and FSG Sub free and clear of all liens and encumbrances.
The partnership interests owned by FSG in the Drive-Thru Partnership constitute
a forty percent (99%) interest in the Drive-Thru Partnership. Except for those
interests in the Drive-Thru Partnership owned by FSG Sub immediately prior to
the Effective Time, there are no other outstanding interests in the Drive-Thru
Partnership nor are there any options, warrants, rights, subscriptions, claims
of any character, agreements, obligations, convertible or exchangeable
securities, or other commitments, contingent or otherwise, relating to interests
in the Drive-Thru Partnership pursuant to which the Drive-Thru Partnership is or
may become obligated or any Person is entitled to acquire any interest in the
Drive-Thru Partnership or any securities convertible into, exchangeable for, or
evidencing the right to subscribe for, any interest in the Drive-Thru
Partnership. As of the Effective Time, there will be no restrictions of any kind
in the Drive-Thru Partnership Agreement that prevent the payment of
distributions by the Drive-Thru Partnership.
(v) Except for its interests in the Gas Partnership and
stock of FSG and FSCI Sub that FSCI will acquire pursuant to or in furtherance
of the Xxxx Agreement immediately prior to the Effective Time, at the Effective
Time FSCI will not own, directly or indirectly, any capital stock or other
equity interest in any Person or have any direct or indirect equity or ownership
interest in any Person. Except as contemplated by this Agreement, each of FSCI,
FSCI Sub, FSG, FSG Sub, and the Partnerships are not subject to any obligation
or requirement to provide funds for or to make any investments (in the form of a
loan, capital contribution or otherwise) to or in any Person.
(d) Consents and Approvals; No Violations. Assuming that
filings required under the HSR Act are made and the waiting period thereunder
has been terminated or has expired, the filing of the Certificate of Merger and
other appropriate merger documents, if any, as required by the DGCL or under the
applicable provisions of Florida law, are made, and the Bankruptcy Court enters
an order, that may be the Confirmation Order, approving the Merger and this
Agreement, and subject to the receipt of those consents and approvals identified
in Schedule 2.2(d), the execution and delivery of this Agreement by FSCI and the
consummation by FSCI of the transactions contemplated hereby will not: (i)
violate any provision of the Certificate of Incorporation or Bylaws of FSCI,
FSCI Sub, FSG, or FSG Sub, respectively, or the Gas Partnership Agreement or
Drive-Thru Partnership Agreement, each as in effect as of the Effective Time;
(ii) violate any statute, ordinance, rule, regulation, order or decree of any
court or of any governmental or regulatory body, agency or authority applicable
to FSCI, FSCI Sub, FSG, FSG Sub, the Partnerships, or by which their respective
properties or assets may be bound; (iii) require any filing with, or permit,
consent or approval of, or the giving of any notice to any governmental or
regulatory body, agency or authority; (iv) result in a violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default (or give rise to any right of termination, cancellation or
acceleration) under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of FSCI, FSCI Sub,
FSG, FSG Sub, or the Partnerships under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, franchise, permit,
agreement, lease or other instrument or obligation to which FSCI, FSCI Sub, FSG,
FSG Sub, or the Partnerships are a party, or by which they or their respective
properties or assets may be bound, excluding from the foregoing clauses (iii)
and (iv) filings, notices, permits, consents and approvals the absence of which,
and violations, breaches, defaults, conflicts and liens that, in the aggregate,
would not have a material adverse effect on the Condition of FSCI, FSCI Sub,
FSG, FSG Sub, or the Partnerships taken as a whole; or (v) trigger any consent
or approval requirements with respect to those leases, licenses, permits, or
approvals held by the Partnerships (excluding those leases, licenses, permits,
or approvals with respect to the Walk-In Convenience Stores Partnerships to
another entity in accordance with this Agreement).
(e) FSCI Reports and Financial Statements. FSCI has
delivered to the Company combined balance sheets for the Partnerships and each
of their combined affiliates as of the end of the fiscal years ended September
1, 1996, August 31, 1997 and August 30, 1998 and the combined statements of
operations, combined statement of equity and consolidated statements of changes
in financial position for the Partnerships and each of their combined affiliates
for the fiscal years ended September 1, 1996, August 31, 1997 and August 30,
1998. Such financial statements were prepared in accordance with generally
accepted accounting principles (as in effect at the time such financial
statements were prepared) applied on a consistent basis (except as may be
indicated therein or in the notes or schedules thereto) and fairly present in
all material respects the combined financial position of the Partnerships and
their combined affiliates as of the dates thereof and the results of their
operations and changes in financial position for the periods then ended.
(f) Absence of Certain Changes. Except as disclosed in
Schedule 2.2(f) hereto, since December 31, 1998: (i) there has not been any
material adverse change in the Condition of FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships, taken as a whole; (ii) the businesses of FSCI, FSCI Sub, FSG, FSG
Sub, and the Partnerships have been conducted only in the ordinary course; (iii)
FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships have not incurred any
material liabilities (direct, contingent or otherwise) or engaged in any
material transaction or entered into any material agreement outside the ordinary
course of business; (iv) FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships have
not increased the compensation of any officer or granted any general salary or
benefits increase to their employees other than in the ordinary course of
business; and (v) FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships have not
taken any action referred to in Section 3.4 hereof except as permitted or
required thereby.
(g) Minute Books. The minute books of FSCI, FSG, and the
managing general partner of the Partnership, as previously made available to the
Company and its representatives, contain accurate records of all meetings of the
stockholders or partners, as appropriate, all corporate actions or written
consents by the stockholders and Boards of Directors of FSCI and FSG, and all
actions on behalf of the Partnership by the managing general partner of the
Partnership since January 1, 1996.
(h) Title to Properties; Encumbrances.
(i) FSCI, FSCI Sub, FSG, FSG Sub and the Partnerships
have, or will acquire contemporaneously with the Merger, good, valid and
marketable title to all of their respective material tangible properties and
assets (real and personal), including, without limitation, all the properties
and assets reflected in Schedule 2.2(h), subject to no encumbrance, lien, charge
or other restriction of any kind or character, except for (A) liens pertaining
to indebtedness reflected in the balance sheets of the Partnerships and
described on Schedule 2.2(h), (B) liens consisting of zoning or planning
restrictions, easements, permits and other restrictions or limitations on the
use of real property or irregularities in title thereto that do not materially
detract from the value of, or impair the use of, such property by FSCI, FSCI
Sub, FSG, FSG Sub, or the Partnerships in the operation of their respective
businesses, (C) liens for current taxes, assessments or governmental charges or
levies on property not yet due and delinquent, and (D) statutory landlord's
liens, liens granted to landlords under leases for the FSCI Facilities, and fee
mortgages made by such landlords.
(ii) Schedule 2.2(h) sets forth a list of all FSCI
Facilities now being occupied, or to be occupied on the Closing Date, by FSCI,
FSCI Sub, FSG, FSG Sub, or the Partnerships or used in connection with their
respective operations. The FSCI Facilities are all, or will be on the Closing
Date, premises leased or owned by FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships. Schedule 2.2(h) describes those leases of FSCI Facilities that
require the landlord's consent to assignment of such leases. No notices of any
building or health code violations with respect to any of the FSCI Facilities
have been received and are pending or uncured which would be material to any
FSCI Facility. Each of FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships have
complied with all federal, state and local laws, ordinances, rules and
regulations applicable to each FSCI Facility, except where the failure to so
comply would not have a material adverse effect on the Condition of FSCI, FSCI
Sub, FSG, FSG Sub, or the Partnerships. Except as disclosed in Schedule 2.2(h),
there is no pending, proposed, or, to FSCI's, knowledge, threatened
condemnation, eminent domain, or similar proceeding affecting any of the FSCI
Facilities.
(i) Compliance with Laws. FSCI, FSCI Sub, FSG, FSG Sub and
the Partnerships are in compliance with all applicable laws, regulations,
orders, judgments and decrees except where the failure to so comply with the
same would not have a material adverse effect on the Condition of FSCI, FSCI
Sub, FSG, FSG Sub, or the Partnerships taken as a whole.
(j) Litigation. Except as set forth in Schedule 2.2(j)
hereto, there is no action, suit, proceeding at law or in equity, or any
arbitration or any administrative or other proceeding by or before (or to the
best knowledge, information and belief of the Company any investigation by) any
governmental or other instrumentality or agency, pending, or, to the best
knowledge, information and belief of FSCI, threatened, against or affecting
FSCI, FSG, the Partnership, or any of their respective properties or rights that
could have a material adverse effect on the Condition of FSCI, FSCI Sub, FSG,
FSG Sub, or the Partnerships. There are no such suits, actions, claims,
proceedings or investigations pending or, to the best knowledge, information and
belief of FSCI, threatened, seeking to prevent or challenging the transactions
contemplated by this Agreement. FSCI, FSCI Sub, FSG, FSG Sub, and the
Partnerships are not subject to any judgment, order or decree entered in any
lawsuit or proceeding that could have a material adverse effect on the Condition
of FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships, taken as a whole or on the
ability of FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships to conduct their
respective businesses as presently conducted. Schedule 2.2(j) sets forth all
litigation involving FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships that is
pending or, to FSCI's knowledge, threatened against FSCI, FSCI Sub, FSG, FSG
Sub, or the Partnerships.
(k) Employee Benefit Plans.
(i) List of Plans. Set forth in Schedule 2.2(k) is an
accurate and complete list of all Employee Benefit Plans within the meaning of
Section 3(3) of ERISA, whether or not any such Employee Benefit Plans are
otherwise exempt from the provisions of ERISA, established, maintained or
contributed to by FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships (including,
for this purpose and for the purpose of all of the representations in this
Section 2.2(k)), all employers (whether or not incorporated) that by reason of
common control are treated together with the Company as a single employer within
the meaning of Section 414 of the Code).
(ii) Status of Plans. Except as set forth in Schedule
22(k) FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships do not maintain any
Employee Benefit Plans subject to ERISA.
(iii) Contributions. Full payment has been made of all
amounts that FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships are required,
under applicable law or under any Employee Benefit Plan or any agreement
relating to any Employee Benefit Plan to which FSCI, or FSG or the Partnership
is or was a party, to have paid as contributions thereto as of the last day of
the most recent fiscal year of such Employee Benefit Plan ended prior to the
date hereof. FSCI has made adequate provision for reserves to meet contributions
that have not been made because they are not yet due under the terms of any
Employee Benefit Plan or related agreements. Benefits under all Employee Benefit
Plans are as represented and have not been increased subsequent to the date as
of which documents have been provided to the Company.
(iv) [Intentionally Omitted]
(v) Tax Qualification. Each Employee Benefit Plan of
FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships intended to be qualified
under Section 401(a) of the Code has been determined to be so qualified by the
Internal Revenue Service and nothing has occurred since the date of the last
such determination that resulted or is likely to result in the revocation of
such determination.
(vi) Transactions. No Reportable Event (as defined in
Section 4043 of ERISA) for which the 30-day notice requirement has not been
waived by the PBGC has occurred with respect to any Employee Benefit Plan
maintained by FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships and FSCI, FSCI
Sub, FSG, FSG Sub, and the Partnerships have not engaged in any transaction with
respect to the Employee Benefit Plans maintained by them that would subject any
of them to a tax, penalty or liability for prohibited transactions under ERISA
or the Code nor have any of their respective directors, officers, partners, or
employees to the extent they or any of them are fiduciaries with respect to such
Employee Benefit Plans, breached any of their responsibilities or obligations
imposed upon fiduciaries under Title I of ERISA or would result in any claim
being made under or by or on behalf of any such Employee Benefit Plans by any
party with standing to make such claim.
(vii) Other Plans. The Company currently does not
maintain any employee or non-employee benefit plans or any other foreign
pension, welfare or retirement benefit plans other than those listed in Schedule
2.1(k).
(viii) Documents. FSCI has made available to the
Company and its counsel true and complete copies of (A) all Employee Benefit
Plans maintained by FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships as in
effect, together with all amendments thereto that will become effective at a
later date, as well as the latest Internal Revenue Service determination letter
obtained with respect to any such Employee Benefit Plan qualified under Section
401 or 501 of the Code and (B) Form 5500 for the most recent completed fiscal
year for each such Employee Benefit Plan required to file such form.
(l) Employment Relations and Agreements. (i) FSCI, FSCI Sub,
FSG, FSG Sub, and the Partnerships are in substantial compliance with all
federal, state or other applicable laws respecting employment and employment
practices, terms and conditions of employment and wages and hours, and have not
and are not engaged in any unfair labor practice; (ii) to the knowledge of FSCI,
no unfair labor practice complaint against FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships is pending before the National Labor Relations Board; (iii) there
is no labor strike, dispute, slowdown or stoppage actually pending or, to the
knowledge of FSCI, threatened against or involving FSCI, FSCI Sub, FSG, FSG Sub,
or the Partnerships; (iv) no representation question exists respecting the
employees of FSCI , FSG, or the Partnership; (v) to the knowledge of FSCI, no
grievance that might have a material adverse effect on the Condition of FSCI,
FSCI Sub, FSG, FSG Sub, or the Partnerships or the conduct of their respective
businesses exists, no arbitration proceeding arising out of or under any
collective bargaining agreement is pending and no claim therefor has been
asserted; (vi) no collective bargaining agreement is currently in effect or
being negotiated by FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships; and (vii)
none of FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships has experienced any
material labor difficulty during the last three years. There has not been, and,
to the best knowledge of FSCI, there will not be, any change in relations with
employees of FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships as a result of
the transactions contemplated by this Agreement that could have a material
adverse effect on the Condition of FSCI, FSG, the Partnership, or the Surviving
Corporation, taken as a whole. Except as disclosed in Schedule 2.2(l) attached
hereto (which schedule lists the maximum payment that could be owed), there
exist no employment, consulting, severance or indemnification agreements (x)
between FSCI and any director, officer or employee of FSCI or any agreement that
would give any Person the right to receive any payment from FSCI as a result of
the Merger, (y) between FSG and any director, officer or employee of FSG or any
agreement that would give any Person the right to receive any payment from FSG
as a result of the Merger, and (z) between the Partnership and any partner or
employee of the Partnership or any agreement that would give any Person the
right to receive any payment from the Partnership as a result of the Merger.
(m) [Intentionally Omitted]
(n) Taxes. FSCI, FSCI Sub, FSG, FSG Sub, and the
Partnerships have filed or caused to be filed, within the times and in the
manner prescribed by law (including permitted extensions of time to file), all
federal, state, local and foreign tax returns and tax reports that are required
to be filed by, or with respect to, FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships. All federal, state, local and foreign income, profits, franchise,
sales, use, occupancy, excise and other taxes and assessments (including
interest and penalties) payable by, or due from, FSCI, FSCI Sub, FSG, FSG Sub,
or the Partnerships have been fully paid or adequately disclosed and fully
provided for in the books and financial statements of FSCI, FSCI Sub, FSG, FSG
Sub, and the Partnerships. No examination of any tax return of FSCI, FSCI Sub,
FSG, FSG Sub, or the Partnerships is currently in progress. There are no
outstanding agreements or waivers extending the statutory period of limitation
applicable to any tax return of FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships.
(o) Liabilities. FSCI, FSCI Sub, FSG, FSG Sub, and the
Partnerships have no material outstanding claims, liabilities or indebtedness,
contingent or otherwise, required to be reflected in a financial statement
prepared in accordance with GAAP, except as set forth in the financial
statements delivered to the Company, or referred to in the footnotes thereto,
other than liabilities incurred subsequent to December 31, 1998 in the ordinary
course of business not involving borrowings by FSCI, FSCI Sub, FSG, FSG Sub, or
the Partnerships. FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships are not in
default in respect of the material terms and conditions of any material
indebtedness or other agreement.
(p) Intellectual Properties. In the operation of its
business, FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships have used, and
currently use, domestic and foreign patents, patent applications, patent
licenses, software licenses, know-how licenses, trade names, trademarks,
copyrights, unpatented inventions, service marks, trademark registrations and
applications, service xxxx registrations and applications, copyright
registrations and applications, trade secrets and other confidential proprietary
information, other than commercially available computer software programs
(collectively the "Farm Store Intellectual Property"). Schedule 2.2(p) attached
hereto contains an accurate and complete list of all Farm Store Intellectual
Property that is of material importance to the operation of the business of
FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships. Unless otherwise indicated
in Schedule 2.2(p), FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships owns the
entire right, title and interest in and to the Farm Store Intellectual Property
listed on Schedule 2.2(p) used in the operation of the businesses of FSCI, FSCI
Sub, FSG, FSG Sub, and the Partnerships (including, without limitation, the
exclusive right to use and license the same) and each item constituting part of
the Farm Store Intellectual Property that is owned by FSCI, FSCI Sub, FSG, FSG
Sub, or the Partnerships and listed on Schedule 2.2(p) has been, to the extent
indicated in Schedule 2.2(p), duly registered with, filed in or issued by, as
the case may be, the United States Patent and Trademark Office or such other
government entities, domestic or foreign, as are indicated in Schedule 2.2(p)
and such registrations, filings and issuances remain in full force and effect.
To the best knowledge of FSCI, except as stated in such Schedule 2.2(p), there
are no pending or threatened proceedings or litigation or other adverse claims
affecting or with respect to the Farm Store Intellectual Property. Schedule
2.2(p) lists all material notices or claims currently pending or received by
FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships during the past two years that
claim infringement, contributory infringement, inducement to infringe,
misappropriation or breach by FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships
of any domestic or foreign patents, patent applications, patent licenses and
know-how licenses, trade names, trademark registrations and applications,
service marks, copyrights, copyright registrations or applications, trade
secrets or other confidential proprietary information. To the best knowledge of
FSCI, except as indicated on Schedule 2.2(p), no Person is materially infringing
the Farm Store Intellectual Property.
(q) Broker's or Finder's Fee. No agent, broker, Person or
firm acting on behalf of FSCI, FSG, the Partnership, or FSCI Shareholder is, or
will be, entitled to any fee, commission or broker's or finder's fees from any
of the parties hereto, or from any Person controlling, controlled by, or under
common control with any of the parties hereto, in connection with this Agreement
or any of the transactions contemplated hereby.
(r) Environmental Matters. Except as disclosed on Schedule
2.2(r) attached hereto:
(i) FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships
are, and at all times have been, in substantial compliance with, and have not
been and are not in violation of or liable under, any Environmental Law with
respect to any of their respective real property, leaseholds or other real
property interests owned or leased by the FSCI, FSCI Sub, FSG, FSG Sub, or the
Partnerships, and any buildings, plants, structures, or equipment (including
motor vehicles), that are owned or leased both as of the date hereof and as of
the Closing Date (collectively, "FSCI Facilities"). Except for matters covered
by the applicable state remediation programs, FSCI, FSCI Sub, FSG, FSG Sub, and
the Partnerships have not received any actual or threatened order, notice, or
other communication from (A) any governmental body or private citizen acting in
the public interest, or (B) the current or prior owner or operator of any FSCI
Facilities, of any actual or potential violation or failure to comply with any
Environmental Law, or of any actual or threatened obligation to undertake or
bear the cost of any Environmental, Health, and Safety Liabilities with respect
to any of the FSCI Facilities or any other properties or assets (whether real,
personal, or mixed) in which FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships
has an interest, or with respect to any FSCI Facility at or to which Hazardous
Materials were generated, manufactured, refined, transferred, imported, used, or
processed by FSCI, FSG, the Partnership, or any other Person for whose conduct
they are or may be held responsible, or from which Hazardous Materials have been
transported, treated, stored, handled, transferred, disposed, recycled, or
received.
(ii) There are no pending or, to the knowledge of FSCI,
threatened claims, liens, or other restrictions of any nature, resulting from
any Environmental, Health, and Safety Liabilities or arising under or pursuant
to any Environmental Law, with respect to or affecting any of the FSCI
Facilities or any other properties and assets (whether real, personal, or mixed)
in which FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships or its subsidiaries
has an interest.
(iii) Except for matters covered by the applicable
state remediation programs and/or by applicable insurance policies, FSCI, FSCI
Sub, FSG, FSG Sub, and the Partnerships have not received any citation,
directive, inquiry, notice, order, summons, warning, or other communication that
relates to Hazardous Activity, Hazardous Materials, or any alleged, actual, or
potential violation or failure to comply with any Environmental Law, or of any
alleged, actual, or potential obligation to undertake or bear the cost of any
Environmental, Health, and Safety Liabilities with respect to any of the FSCI
Facilities.
(iv) Except for matters covered by the applicable state
remediation programs and/or by applicable insurance policies, FSCI, FSCI Sub,
FSG, FSG Sub, and the Partnerships have no Environmental, Health, and Safety
Liabilities with respect to the FSCI Facilities or with respect to any other
properties and assets (whether real, personal, or mixed) in which FSCI, FSCI
Sub, FSG, FSG Sub, or the Partnerships (or any predecessor), has an interest, or
at any property geologically or hydrologically adjoining the FSCI Facilities or
any such other property or assets.
(v) Except for matters covered by the applicable state
remediation programs and/or by applicable insurance policies, there has been no
Release or, to the knowledge of FSCI, threat of Release, of any Hazardous
Materials at or from the FSCI Facilities or, to the knowledge of FSCI, at any
other locations where any Hazardous Materials were generated, manufactured,
refined, transferred, produced, imported, used, or processed from or by the FSCI
Facilities, or from or by any other properties and assets (whether real,
personal, or mixed) in which FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships
has an interest, or, to the knowledge of the FSCI and FSCI Shareholder, any
geologically or hydrologically adjoining property, whether by FSCI, FSG, the
Partnership, or any other Person.
(vi) FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships
have made available to the Company true and complete copies and results of any
reports, studies, analyses, tests, or monitoring possessed or initiated by FSCI,
FSCI Sub, FSG, FSG Sub, or the Partnerships pertaining to Hazardous Materials or
Hazardous Activities in, on, or under the FSCI Facilities, or concerning
compliance by FSCI, FSG, the Partnership, or any other Person for whose conduct
they are or may be held responsible, with Environmental Laws.
(s) Xxxx Agreement. Except as provided in Schedule 2.2(s),
that certain letter agreement, by and between Xxxx X. Xxxxx, as President of
F.S. Dairy Plan, Inc., FSCI, and F.S. Stores, Inc., and Xxxxxxx Xxxxxx, as
President of Robi Dairy Plant, Inc., REW Dairy Investments, Inc., and Xxxx Gas &
Food Stores, Inc., dated April 23, 1999 (the "Xxxx Agreement") a copy of which
has been provided to the Company:
(i) has been duly executed and delivered by the parties
thereto;
(ii) has been approved by all requisite corporate
action of the parties thereto;
(iii) constitutes a valid and binding obligation of
each of the parties thereto, enforceable against each such party in accordance
with its terms; and
(iv) constitutes the entire agreement among the parties
with respect to the transactions contemplated by the Xxxx Agreement and there
have been no oral or written modifications to the Xxxx Agreement.
(t) Material Contracts. Schedule 2.2(t) identifies all
material contracts, agreements and other written or oral arrangements to which
FSCI, FSG or the Partnership is a party and true, correct and complete copies
(with all amendments thereto) thereof have been made available to the Company.
"Material" contracts, agreements and arrangements are those that obligate the
parties, in the aggregate, to in excess of $50,000 of obligations. With respect
to each written arrangement so listed: (i) the written arrangement is legal,
valid, binding, enforceable, and in full force and effect, and has not been
materially amended or altered; and (ii) FSCI, any subsidiary of FSCI, FSCI Sub,
FSG, FSG Sub, and the Partnerships are not in breach or default, and no event
has occurred that, with notice or lapse of time, or both, would constitute a
breach or default by the FSCI, any subsidiary of FSCI, FSG or the Partnership or
permit a party other than the Company or its subsidiaries to terminate, modify,
or accelerate performance under any such written arrangement; and (iii) to
FSCI's knowledge, no party other than FSCI, any subsidiary of FSCI, FSCI Sub,
FSG, FSG Sub, or the Partnerships is in breach or default, and no event has
occurred that, with notice or lapse of time, or both, would constitute a breach
or default or permit termination, modification, or acceleration, under any such
written arrangement.
ARTICLE III
TRANSACTIONS PRIOR TO CLOSING DATE; COVENANTS
Section 3.1 Access to Information Concerning Properties and
Records.
(a) During the period commencing on the date hereof and
ending on the Closing Date, the Company shall, and shall cause each of its
subsidiaries to, upon reasonable notice, afford FSCI, and its counsel,
accountants and other authorized representatives, full access during normal
business hours to the properties, books and records of the Company and its
subsidiaries in order that they may have the opportunity to make such
investigations as they shall desire of the affairs of the Company and its
subsidiaries; such investigation shall not, however, affect the representations
and warranties made by the Company in this Agreement. The Company agrees to
cause its officers and employees to furnish such additional financial and
operating data and other information and respond to such inquiries as FSCI shall
from time to time request.
(b) During the period commencing on the date hereof and
ending on the Closing Date, FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships
shall, upon reasonable notice, afford the Company, and its counsel, accountants
and other authorized representatives, full access during normal business hours
to the properties, books and records of FSCI, FSCI Sub, FSG, FSG Sub, and the
Partnerships in order that it may have the opportunity to make such
investigations as it shall desire of the affairs of FSCI, FSCI Sub, FSG, FSG
Sub, and the Partnerships; such investigation shall not, however, affect the
representations and warranties made by FSCI in this Agreement. FSCI, FSCI Sub,
FSG, FSG Sub, and the Partnerships agree to cause their respective officers and
employees to furnish such additional financial and operating data and other
information and respond to such inquiries as the Company shall from time to time
request.
Section 3.2 Confidentiality. Information obtained by FSCI and the
Company pursuant to Section 3.1 hereof shall be subject to the provisions of the
Confidentiality Agreements between the Company and FSCI, each executed during
June, 1999.
Section 3.3 Conduct of the Business of the Company Pending the
Closing Date. The Company agrees that, except as permitted, required or
specifically contemplated by, or otherwise described in, this Agreement, as may
be required by the Bankruptcy Court in connection with the Chapter 11 Case or
Chapter 11 Plan, or otherwise consented to or approved in writing by FSCI,
during the period commencing on the date hereof and ending on the Closing Date:
(a) The Company and each of its subsidiaries will conduct
their respective operations only according to their ordinary and usual course of
business and will use their best efforts to preserve intact their respective
business organization, keep available the services of their officers and
employees and maintain satisfactory relationships with licensors, suppliers,
distributors, clients and others having business relationships with them;
(b) Neither the Company nor any of its subsidiaries shall
(i) make any change in or amendment to its Certificate of Incorporation or
By-Laws (or comparable governing documents); (ii) issue or sell any shares of
its capital stock or any of its other securities, or issue any securities
convertible into, or options, warrants or rights to purchase or subscribe to, or
enter into any arrangement or contract with respect to the issuance or sale of,
any shares of its capital stock or any of its other securities, or make any
other changes in its capital structure; (iii) declare, pay or make any dividend
or other distribution or payment with respect to, or split, redeem or
reclassify, any shares of its capital stock; (iv) enter into any contract or
commitment except contracts in the ordinary course of business, including
without limitation, any acquisition of a material amount of assets or
securities, any disposition of a material amount of assets or securities or
release or relinquish any material contract rights; (v) amend any employee or
non-employee benefit plan or program, employment agreement, license agreement or
retirement agreement, or pay any bonus or contingent compensation, except in
each case in the ordinary course of business consistent with past practice prior
to the date of this Agreement; (vi) agree, in writing or otherwise, to take any
of the foregoing actions;
(c) Without limiting the generality of subsection (a),
above, the Company shall continue to pay its accounts payable in the ordinary
course and in accordance with its regular and usual practices pertaining to
timing of payment of such payables; and
(d) The Company shall not, and shall not permit any of its
subsidiaries to, (i) take any action, engage in any transaction or enter into
any agreement that would cause any of the representations or warranties set
forth in Section 2.1 hereof to be materially untrue as of the Closing Date, or
(ii) purchase or acquire, or offer to purchase or acquire, any shares of capital
stock of the Company.
Section 3.4 Conduct of the Business of FSCI, FSCI Sub, FSG, FSG
Sub, and the Partnerships Pending the Closing Date. FSCI agrees that, except as
permitted, required or specifically contemplated by, or otherwise described in,
this Agreement, or pursuant to alternative means to perform under the Xxxx
Agreement, or otherwise consented to or approved in writing by the Company,
during the period commencing on the date hereof and ending on the Closing Date:
(a) FSCI will conduct its operations, will not close any
stores (except as set forth on schedule 3.4(a)), and will cause FSCI Sub, FSG,
FSG Sub, and the Partnerships to conduct their operation, only according to
their ordinary and usual course of business and will use its commercially
reasonable best efforts to preserve intact their respective business
organization, keep available the services of their officers and employees and
maintain satisfactory relationships with licensors, suppliers, distributors,
clients and others having business relationships with FSCI, FSCI Sub, FSG, FSG
Sub, and the Partnerships;
(b) FSCI shall not and shall ensure that FSCI Sub, FSG, FSG
Sub and the Partnerships do not (i) make any change in or amendment to its
Certificate of Incorporation or By-Laws or partnership agreement (or comparable
governing documents); (ii) issue or sell any shares of its capital stock or any
of its other securities, or issue any securities convertible into, or options,
warrants or rights to purchase or subscribe to, or enter into any arrangement or
contract with respect to the issuance or sale of, any shares of its capital
stock or any of its other securities, or make any other changes in its capital
structure; (iii) declare, pay or make any dividend or other distribution or
payment with respect to, or split, redeem or reclassify, any shares of its
capital stock, except that, immediately prior to the Effective Time, the
Partnerships may distribute its cash balances (other than funds in the cash
registers of the "Walk-In Convenience Stores" (as defined below) as of the close
of business on the business day immediately preceding the Effective Time) to the
FSCI Shareholder; (iv) enter into any contract or commitment except contracts in
the ordinary course of business, including without limitation, any acquisition
of a material amount of assets or securities, any disposition of a material
amount of assets or securities or release or relinquish any material contract
rights; (v) amend any employee or non-employee benefit plan or program,
employment agreement, license agreement or retirement agreement, or pay any
bonus or contingent compensation, except in each case in the ordinary course of
business consistent with past practice prior to the date of this Agreement; or
(vi) agree, in writing or otherwise, to take any of the foregoing actions;
(c) Without limiting the generality of subsection (a),
above, FSCI, FSCI Sub, FSG, FSG Sub, and the Partnerships shall continue to pay
their respective accounts payable in the ordinary course and in accordance with
its regular and usual practices pertaining to timing of payment of such
payables; and
(d) FSCI shall not, and shall cause FSCI Sub, FSG, FSG Sub,
and the Partnerships not to, take any action, engage in any transaction or enter
into any agreement that would cause any of the representations or warranties set
forth in Section 2.2 hereof to be materially untrue as of the Closing Date.
Section 3.5 Best Efforts. Each of the Company and FSCI shall, and
the Company shall cause each of its subsidiaries to and FSCI shall cause each of
FSCI Sub, FSG, FSG Sub, and the Partnerships to, cooperate and use their
respective commercially reasonable best efforts to take, or cause to be taken,
all appropriate action, and to make, or cause to be made, all filings necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement, including, without
limitation, their respective best efforts to obtain, prior to the Closing Date,
all licenses, permits, consents, approvals, authorizations, qualifications and
orders of governmental authorities and parties to contracts with the Company and
its subsidiaries as are necessary for consummation of the transactions
contemplated by this Agreement and to fulfill the conditions to the Merger.
Section 3.6 HSR Act. The Company and FSCI shall, as soon as
practicable, file Notification and Report Forms under the HSR Act with the
Federal Trade Commission (the "FTC") and the Antitrust Division of the
Department of Justice (the "Antitrust Division") and shall use their respective
best efforts to respond as promptly as practicable to all inquiries received
from the FTC or the Antitrust Division for additional information or
documentation.
Section 3.7 Merger Financing. FSCI shall use its best efforts
together with HW Partners, L.P. to obtain, prior to the Effective Time, the
Merger Financing. The Company and FSCI shall irrevocably commit the proceeds of
the Merger Financing, as follows: (a) $17,000,000.00 for payment under the Xxxx
Agreement by FSCI, (b) $3,000,000.00 for payment to the FSCI Shareholder as part
of the Merger Consideration, (c) that amount required to make the payments due
upon confirmation of the Chapter 11 Plan, and (d) the balance thereof for
working capital or other corporate uses of the Surviving Corporation.
Section 3.8 Plan Covenants. Unless and until this Agreement is
terminated by FSCI or the Company or the Bankruptcy Court fails to confirm the
Chapter 11 Plan (after giving effect to whatever amendments thereto FSCI may
agree), the Company will not actively solicit any Person (other than FSCI) for
the purpose of pursuing a sale or merger transaction with the Company or its
subsidiaries or the assets of any of them. Further, the Company agrees to
provide FSCI with prompt written notice of any offer or expression of interest
(written or otherwise) it receives from any third party for any such
transaction, and to include in such notice the identity of the Person expressing
such interest and a description of the transaction proposed by such Person.
Unless and until this Agreement is terminated by FSCI or the Company, the
Company agrees: (a) to actively and with best efforts support and not directly
or indirectly oppose the confirmation of the Chapter 11 Plan; (b) not to amend
or modify the Chapter 11 Plan without the written consent of FSCI; (c) not to
file, sponsor, or promote any plan or reorganization or liquidation other than
the Chapter 11 Plan; and (d) not to seek dismissal of the Chapter 11 Case or
conversion of the Chapter 11 Case to a case under Chapter 7 of the Bankruptcy
Code.
Section 3.9 Casualty Stores. There are two (2) convenience stores
that have been affected by casualty (each a "Casualty Store" and, collectively,
"Casualty Stores"). The Gas Partnership shall have the right to either (a)
rebuild the Casualty Stores as it sees fit, or (b) transfer the Casualty Stores
to the Drive-Thru Partnership. The Surviving Corporation shall make this
election by written notice to FSG within three (3) months after the Effective
Time.
ARTICLE IV
CONDITIONS PRECEDENT TO MERGER
Section 4.1 Conditions Precedent to Obligations of UPC, UPC
Merger Sub and FSCI. The respective obligations of FSCI, on the one hand, and
the Company and UPC Merger Sub, on the other hand, to effect the Merger are
subject to the satisfaction or waiver (subject to applicable law) at or prior to
the Effective Time of each of the following conditions:
(a) Effectiveness of the Chapter 11 Plan. All conditions
precedent to the effectiveness of the Chapter 11 Plan shall have been satisfied
or waived.
(b) The Confirmation Order. The Confirmation Order shall
have been entered in a form and content acceptable to FSCI and the Company,
shall not have been modified, amended, dissolved, revoked or rescinded, shall be
in full force and effect on the Closing Date, and, without the necessity of any
further action or proceedings by the Company, any of its subsidiaries or the
Bankruptcy Court, shall have, to the extent specified in the Plan, (i) on or
prior to the Closing Date, effected a full and complete discharge and release
of, and thereby extinguished, all debts of the Company and each of its
subsidiaries (to the fullest extent possible under Section 1141(d)(1) of the
Bankruptcy Code) (ii) extinguished all Existing Shares and Existing Equity
Rights, and (iii) at and as of the Closing Date, authorized the issuance of New
UPC Common Stock and New UPC Preferred Stock in accordance with the Plan.
(c) Government Consents. All government consents necessary
for the consummation of the Merger shall have been received (except for
government consents, the absence of which will, alone and in the aggregate, not
have a material adverse effect on the Condition of the Surviving Corporation
either on or after the Closing) and any waiting period (and any extension
thereof) with respect to the HSR Act shall have expired or been terminated.
(d) Material Adverse Effect. Since the date hereof, there
shall not have been any material adverse change with respect to the Company and
its subsidiaries, FSCI, FSCI Sub, FSG, FSG Sub, or the Partnerships or their
respective assets.
(e) Due Diligence. FSCI and the Company shall be reasonably
satisfied with the results of their due diligence investigations;
(f) Injunction. No preliminary or permanent injunction or
other order shall have been issued by any court or by any governmental or
regulatory agency, body or authority that prohibits the consummation of the
Merger and the transactions contemplated by this Agreement and that is in effect
at the Effective Time;
(g) Statutes. No statute, rule, regulation, executive order,
decree or order of any kind shall have been enacted, entered, promulgated or
enforced by any court or governmental authority that prohibits the consummation
of the Merger or has the effect of making the issuance or the purchase of the
Merger Stock illegal.
(h) Merger Financing. The Merger Financing shall have been
obtained, all conditions to the full funding of the Merger Financing shall have
been satisfied or waived, and the proceeds of the Merger Financing shall have
been irrevocably committed as provided in Section 3.7 of this Agreement.
(i) Employment Agreements. The Company shall have entered
into Employment Agreements with Xxxx Bared and Xxxxxx Bared.
Section 4.2 Conditions Precedent to Obligations of FSCI. The
obligations of FSCI and FSCI Shareholder to effect the Merger are also subject
to the satisfaction or waiver, at or prior to the Effective Time, of each of the
following conditions:
(a) Accuracy of Representations and Warranties. All
representations and warranties of the Company and UPC Merger Sub contained
herein shall be true and correct in all material respects as of the date hereof
and at and as of the Closing, with the same force and effect as though made on
and as of the Closing Date, except for representations and warranties made
expressly as of a prior date, that shall continue to be true and correct in all
material respects as of such prior date.
(b) Performance by Company. The Company and UPC Merger Sub
shall have performed in all material respects all obligations and agreements,
and complied in all material respects with all covenants and conditions,
contained in this Agreement to be performed or complied with by it prior to the
Closing Date;
(c) License Agreement. Both the Company and FSCI shall have
executed and delivered a License Agreement, substantially in the form attached
hereto as Exhibit E, with respect to the Company's management of FSG from and
after the Effective Time; and
(d) Management Agreement. Both the Company and FSCI shall
have executed and delivered a Management Agreement, substantially in the form
attached hereto as Exhibit D, with respect to the Company's management of FSG
from and after the Effective Time; and
(e) Resignations of Officers and Directors. On the Closing
Date, all existing officers and directors of the Company and its subsidiaries
shall have tendered their respective resignations.
(f) Other Transactions. The transactions contemplated by the
Xxxx Agreement shall have been performed in their entirety and all consideration
due there under shall have been paid.
(g) Employment Agreements; UPET Related Party Transactions.
Those contracts or other arrangements identified in Schedule 4.2(f) shall have
been terminated (or other arrangements reasonably satisfactory to FSCI shall
have been concluded with respect thereto) and those releases identified in
Schedule 4.2(f) shall have been executed and delivered by the appropriate
parties identified in Schedule 4.2(f).
(h) Required Approvals. The Company shall have secured or
properly applied for all necessary consents, approvals, permits, or licenses
necessary to allow the Surviving Corporation to continue, both on and after the
Closing Date, the sale of all merchandise sold by the Company's stores on the
date of this Agreement, including, without limitation, gasoline and petroleum
products (both as branded and unbranded products), any products offered for sale
under or pursuant to any franchise agreement or license, tobacco products,
alcoholic beverages, money orders, and state lottery tickets.
(i) Distributor Agreement. The Company or FSCI and TCS
Systems, Inc. shall have negotiated an agreement for the assignment to the
Company of the Exxon Distributorship Agreement currently held by TCS Systems,
Inc.
(j) Good Standing. All companies identified in Schedule
2.1(a) shall be in good standing in the jurisdiction in which such company was
formed.
Section 4.3 Conditions Precedent to Obligation of the Company and
UPC Merger Sub. The obligations of the Company and UPC Merger Sub to effect the
Merger is also subject to the satisfaction or waiver, at or prior to the
Effective Time, of each of the following conditions:
(a) Accuracy of Representations and Warranties. All
representations and warranties of FSCI contained herein shall be true and
correct in all material respects as of the date hereof and at and as of the
Closing, with the same force and effect as though made on and as of the Closing
Date, except for representations and warranties made expressly as of a prior
date, that shall continue to be true and correct in all material respects as of
such prior date.
(b) Performance by FSCI. FSCI shall have performed in all
material respects all obligations and agreements, and complied in all material
respects with all covenants and conditions, contained in this Agreement to be
performed or complied with by it prior to the Closing Date;
(c) License Agreement . The Company shall have received an
executed original copy of a license agreement, substantially in the form of
Exhibit E hereto, with respect to use of the "Farm Store" name;
(d) Required Approvals. FSCI shall have used its best effort
to secure all necessary consents, approvals, permits, or licenses necessary to
allow the Surviving Corporation and the Partnerships, as appropriate, to
continue, both on and after the Closing Date, the sale of all merchandise sold
by the Walk-In Convenience Stores and the Drive-Thrus on the date of this
Agreement, including, without limitation, gasoline and petroleum products (both
as branded and unbranded products), any products offered for sale under or
pursuant to any franchise agreement or license, tobacco products, alcoholic
beverages, money orders, and state lottery tickets; provided, however, that FSCI
shall on or before the Effective Date, secure all landlord consents necessary
with respect to that certain Convenience Store number 2651 located in Osceola
County, Florida (the "Required Consent Store") or deliver to the Company
$450,000. In the event of a failure to secure, on or before the Effective Time,
any necessary consents, approvals, permits, or licenses with respect to the
transfer of any Convenience Store other than the Required Consent Store (each a
"Non-Compliant Store"), then, as of the Effective Time, the Surviving
Corporation shall assume all beneficial interests in and to such Non-Compliant
Store, including all benefits and burdens related to ownership of such
Non-Compliant Store, but legal title to such Non-Compliant Store shall be
retained by the Drive-Thru Partnership and not be conveyed to the Surviving
Corporation until such time, not to exceed sixty (60) days from and after the
Effective Date, as the Drive-Thru Partnership, at the Drive-Thru Partnership's
expense, shall have obtained such necessary consents, approvals, permits, or
licenses with respect to such Non-Compliant Store. During such time, the
Drive-Thru Partnership shall operate any Non-Compliant Store solely for the
benefit of and without any management fee to the Surviving Corporation. If, upon
the expiration of the sixty-day period after the Effective Date, the Drive-Thru
Partnership has not obtained the required consents with respect to a
Non-Compliant Store, then FSE shall initiate litigation and bear all costs
related to obtaining such consents.
(e) Ownership of Assets. Subject to the provisions of
Section 4.3(d) and as described on schedule 3.4(a), on the Effective Date and
immediately prior to the Effective Time:
(i) FSCI shall own (A) ten percent (10%) of the issued
and outstanding common stock of FSG, (B) an agreement, subject to approval by
the Board of Directors of the Company, to purchase up to an additional fifteen
percent (15%) of the issued and outstanding common stock of FSG, under a
Purchase Agreement in substantially the form attached as Exhibit F, (C) eleven
(11) retail convenience stores that do not sell gasoline and petroleum products
("Convenience Stores"), and (D) all issued and outstanding stock of FSCI Sub;
(ii) FSCI and FSCI Sub will own all outstanding
interests in the Gas Partnership;
(iii) The Gas Partnership shall own or lease, (A)
sixty-seven (67) retail convenience stores that also sell gasoline and petroleum
products ("Gas Stores"), (B) nine (9) parcels of real estate on which Walk-In
Convenience Stores are situated, (C) two (2) Casualty Stores, and (D) inventory
(at customary levels used in the operation of the Walk-In Convenience Stores),
store fixtures and equipment, merchandise, accounts and general intangibles used
in the operation of the Walk-In Convenience Stores at that time;
(iv) FSG and FSG Sub shall own all outstanding
interests in the Drive-Thru Partnership; and
(v) The Drive-Thru Partnership shall own or lease (A)
all one hundred eight (108) "drive-thru" retail convenience stores operated by
the Drive-Thru Partnership on the date of this Agreement ("Drive-Thrus"), (B)
eleven (11) retail convenience stores that do not sell gasoline or petroleum
products (together with the Convenience Stores and the Gas Stores, the "Walk-In
Convenience Stores"), and (C) all right, title, and interest in and to the trade
names, trademarks, service marks, trade dress, logos, emblems relating to the
name "Farm Stores."
(f) Closing Under Xxxx Agreement. The closing on the
purchase of interests in the Partnerships under the Xxxx Agreement shall have
occurred immediately prior to the Effective Time.
ARTICLE V
TERMINATION AND ABANDONMENT
Section 5.1 Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned, at any time prior to the
Effective Time:
(a) by mutual written consent of the Company and UPC Merger
Sub, on the one hand, and of FSCI and FSCI Shareholder, on the other hand; or
(b) by FSCI and FSCI Shareholder, on the one hand, or the
Company and UPC Merger Sub, on the other hand, if the Effective Time shall not
have occurred by October 15, 1999 or there has been a material breach of any
representation, warranty, obligation, covenant, agreement or condition set forth
in this Agreement on the part of the other party; or
(c) by FSCI if the Chapter 11 Case is dismissed or converted
to a case under Chapter 7 of the Bankruptcy Code.
Section 5.2 Effect of Termination. In the event of the
termination of this Agreement pursuant to Section 5.1 hereof by FSCI and FSCI
Shareholder, on the one hand, or the Company and UPC Merger Sub, on the other
hand, written notice thereof shall forthwith be given to the other party or
parties specifying the provision hereof pursuant to which such termination is
made, and this Agreement shall become void and have no effect, and there shall
be no liability hereunder on the part of FSCI, FSCI Shareholder, the Company, or
UPC Merger Sub, except that Sections 3.2 and 6.1 hereof shall survive any
termination of this Agreement. Nothing in this Section 5.2 shall relieve any
party to this Agreement of liability for breach of this Agreement.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Fees and Expenses. All costs and expenses incurred in
connection with this Agreement and the consummation of the transactions
contemplated hereby shall be paid by the party incurring such costs and
expenses, except for HSR fees payable by the Company as an acquiring person and
the commitment fee payable to Xxxxxxxx Bancorp, Inc.
Section 6.2 Representations and Warranties. The respective
representations and warranties of the Company and UPC Merger Sub, on the one
hand, and FSCI, on the other hand, contained herein or in any certificates or
other documents delivered prior to or at the Closing shall not be deemed waived
or otherwise affected by any investigation made by any party. However, this
Agreement sets forth exclusively all of the parties' representations,
warranties, covenants and agreements regarding the subject matter hereof, and no
representations or statements of any party that is not included in this
Agreement has been relied upon or shall have any legal effect. Except for the
representations and warranties of the parties in this Agreement, each party has
determined to enter into and consummate this Agreement based on its own
independent investigation. Each and every such representation and warranty in
this Agreement shall terminate as of, and not survive the Closing hereunder.
This Section 6.2 shall have no effect upon any other obligation of the parties
hereto, whether to be performed before or after the Effective Time.
Section 6.3 Extension; Waiver. At any time prior to the Effective
Time, the parties hereto, by action taken by or on behalf of the respective
Boards of Directors of the Company, UPC Merger Sub or FSCI, may (i) extend the
time for the performance of any of the obligations or other acts of the other
parties hereto, (ii) waive any inaccuracies in the representations and
warranties contained herein by any other applicable party or in any document,
certificate or writing delivered pursuant hereto by any other applicable party,
or (iii) waive compliance with any of the agreements or conditions contained
herein. Any agreement on the part of any party to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed by such
party.
Section 6.4 Notices. All notices, requests, demands, waivers and
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered in
person or mailed, certified or registered mail with postage prepaid, or Federal
Express or other recognized overnight courier delivery service or sent by telex,
telegram or telecopier, as follows:
(a) if to the Company, to:
United Petroleum Corporation
0000 Xxxxxxx Xxxxxxx Xxxx
Xxxxx X
Xxxxxxxxx, XX 00000
Attention: President
Fax No.: (000)000-0000
with a copy (that will not constitute notice) to:
Young Xxxxxxx Stargatt & Xxxxxx, LLP
Xxxxxx Square North, 11th Floor
0000 Xxxxx Xxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxx, Esquire
Fax No.: (000)000-0000
(b) if to the UPC Merger Sub, to:
c/o United Petroleum Corporation
0000 Xxxxxxx Xxxxxxx Xxxx
Xxxxx X
Xxxxxxxxx, XX 00000
Attention: President
Fax No.: (000)000-0000
with a copy (that will not constitute notice) to:
Young Xxxxxxx Stargatt & Xxxxxx, LLP
Xxxxxx Square North, 11th Floor
0000 Xxxxx Xxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxx, Esquire
Fax No.: (000)000-0000
(c) if to FSCI, to:
F.S. Convenience Stores, Inc.
0000 X.X. 00xx Xxx.
Xxxxx, XX 00000
Attention: President
Fax No.: (000) 000-0000
with a copy (that will not constitute notice) to:
Xxxxxx Xxxxx & Xxxxxxxxx, P.A.
Suite 2950
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxxxx, Esquire
Fax No.: (000) 000-0000
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery, or in the case of overnight courier service, the next business day,
and unless if mailed, in which case on the third business day after the mailing
thereof except for a notice of a change of address, that shall be effective only
upon receipt thereof.
Section 6.5 Entire Agreement. This Agreement and the schedules
and other documents referred to herein or delivered pursuant hereto,
collectively contain the entire understanding of the parties hereto with respect
to the subject matter contained herein and supersede all prior representations,
warranties, agreements and understandings, oral and written, with respect
thereto. The information disclosed in any one schedule to this Agreement shall
be deemed to be disclosed for purposes of each and every other schedule attached
to, or representation made in, this Agreement, provided that proper
cross-reference is made to the appropriate schedule setting forth such
disclosure information.
Section 6.6 Binding Effect; Benefit; Assignment. This Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto without the prior written consent of the other parties.
Nothing in this Agreement, expressed or implied, is intended to confer on any
Person other than the parties hereto or their respective successors and
permitted assigns, any rights, remedies, obligations or liabilities under or by
reason of this Agreement. This Agreement is executed and delivered by each party
solely in a corporate capacity.
Section 6.7 Amendment and Modification. Subject to applicable
law, including but not limited to the requirements of the Bankruptcy Code and
the orders of the Bankruptcy Court, this Agreement may be amended, modified and
supplemented in writing by the parties hereto in any and all respects before the
Effective Time, by action taken by the respective Boards of Directors of FSCI,
UPC Merger Sub and the Company (or by the respective officers authorized by such
Boards of Directors).
Section 6.8 Further Actions. Each of the parties hereto agrees
that, subject to its legal obligations, it will use its best efforts to fulfill
all conditions precedent specified herein, to the extent that such conditions
are within its control, and to do all things reasonably necessary to consummate
the transactions contemplated hereby.
Section 6.9 Headings. The descriptive headings of the several
Articles and Sections of this Agreement are inserted for convenience only, do
not constitute a part of this Agreement and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 6.10 Counterparts. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original, and all
of which together shall be deemed to be one and the same instrument.
Section 6.11 Applicable Law. This Agreement and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to the
conflict of laws rules thereof.
Section 6.12 Severability. If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, the remainder of the terms, provisions, covenants and
restrictions contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
Section 6.13 Definitions. Capitalized terms used throughout this
Agreement shall have the meanings ascribed to them in this Agreement.
(a) Unless otherwise defined in the text of this Agreement,
capitalized terms used in this Agreement shall have the following meanings:
"Closing" means the consummation of the transactions contemplated by this
Agreement on the Closing Date.
"Company Disclosure Schedule" means the disclosure schedule
prepared by the Company that is attached to this Agreement and incorporated by
reference herein.
"Confirmation Order" means a final order entered by the
Bankruptcy Court confirming the Chapter 11 Plan.
"Disclosure Statement" means the disclosure statement dated
July 23, 1999 filed with the Bankruptcy Court on behalf of the Company and in
support of the Chapter 11 Plan.
"Environmental Law" means any federal, state, local or
foreign law (including common law), statute, code, ordinance, rule, regulation
or other requirement relating in any way to the environment, natural resources,
or public or employee health and safety and includes, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"), 42 U.S.C. ss. 9601 et seq., the Hazardous Materials Transportation
Act, 49 U.S.C. ss. 1801 et seq., the Federal Insecticide, Fungicide, and
Rodenticide Act, 7 U.S.C. ss. 136 et seq.., the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. ss. 6901 et seq.., the Toxic Substances Control
Act, 15 U.S.C. ss. 2601 et seq., the Clean Air Act, 42 U.S.C. ss. 7401 et seq.,
the Clean Water Act, 33 U.S.C. ss. 1251 et seq., the Occupational Safety and
Health Act, 29 U.S.C. ss. 651 et seq.., and the Oil Pollution Act of 1990, 33
U.S.C. ss. 2701 et seq., as such laws have been amended or supplemented, and the
regulations promulgated pursuant thereto, and all analogous state and local
statutes.
"Environmental, Health, and Safety Liabilities" means any
liability arising out of violation of an Environmental Law.
"Existing Equity Rights" means options, warrants, or rights
of any nature to receive any form of capital stock of the Company other than New
UPC Common Stock or New UPC Preferred Stock.
"Existing Shares" means all shares of capital stock of the
Company other than New UPC Common Stock or New UPC Preferred Stock.
"FSCI Disclosure Schedule" means the disclosure schedule
prepared by FSCI that is attached to this Agreement and incorporated by
reference herein.
"Hazardous Activity" means any activity in which Hazardous
Materials are used.
"Hazardous Material" means any substance, material or waste
which is regulated by any Governmental Authority of the United States, the
Applicable Foreign Jurisdiction or other national government, including, without
limitation, any material, substance or waste which is defined as a "hazardous
waste," "hazardous material," "hazardous substance," "extremely hazardous
waste," "restricted hazardous waste," "contaminant," "toxic waste" or "toxic
substance" under any provision of Environmental Law, which includes, but is not
limited to, petroleum, petroleum products, asbestos, urea formaldehyde and
polychlorinated biphenyls.
"Merger Financing" means a credit facility that will provide
proceeds of not less than $20,000,000 and not more than $23,000,000 that will be
(i) secured by the Walk-In Convenience Stores, (ii) not require any personal
guarantees of any shareholder of the Company, (iii) upon such other terms and
conditions as shall be acceptable by FSCI and the Company, and (iv) after the
Effective Time, will be an obligation of the Surviving Corporation.
"Person" means any natural person, corporation, general
partnership, limited partnership, limited liability company, business trust, or
other juridical entity.
"Release" means any release, spill, emission, leaking,
pumping, pouring, dumping, emptying, injection, deposit, disposal, discharge,
dispersal, leaching or migration on or into the indoor or outdoor environment or
into or out of any property.
(b) Where any provision contained in this Agreement is
expressly qualified by reference to "best knowledge," "knowledge," "known to" or
similar qualification, the same shall mean the knowledge of any officer,
director, or partner of a party.
(Signature Page Follows)
IN WITNESS WHEREOF, each of FSCI and the Company have caused
this Agreement to be executed by their respective officers thereunto duly
authorized, all as of the date first above-written.
Attest: F.S. CONVENIENCE STORES, INC.,
a Florida corporation
By:
Secretary Name:
Title:
Attest: UNITED PETROLEUM CORPORATION,
a Delaware corporation
By:
Secretary Name:
Title:
Attest: UNITED PETROLEUM SUBSIDIARY, INC.,
a Delaware corporation
By:
Witness Name:
Title:
