AMENDMENT NO. 1 TO CONTRACT OF SALE OF STOCK
IN
CRANBERRY CREEK RAILROAD, INC.
THIS AMENDMENT NO. 1 TO CONTRACT OF SALE OF STOCK IN CRANBERRY CREEK
RAILROAD, INC. (the "Amendment") is made as of February 8, 2006 by and between
the Estate of Xxxxxx X. Xxxxxxxxx, having an address of c/o Xxxx X. Xxxxxxxxx,
Administratrix, 00 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxx (the "Seller"), and
Chartwell International, Inc., a Nevada corporation having an address of 000
Xxxxxxxxx Xxxx., Xxxxx 000, Xxxxxxx, XX 00000 (the "Purchaser"), under that
certain Contract of Sale of Stock in Cranberry Creek Railroad, Inc. dated as of
December 30, 2005 (the "Agreement"). Capitalized terms not specifically
described herein shall have the meaning ascribed to them in the Agreement.
RECITALS
WHEREAS, the Seller and Purchaser executed the Agreement dated December 30,
2005, pursuant to which the Purchaser was willing to acquire from the Seller,
and the Seller was willing to sell to the Purchaser, on the terms and subject to
the conditions set forth in the Agreement, Sixty-Six and two-thirds Percent (66
2/3%) of all the issued and outstanding shares of capital stock in Cranberry
Creek Railroad, Inc., consisting of twenty (20) shares of common stock;
WHEREAS, the Seller was a party to a governance proceeding, the resolution
of which is a condition precedent to certain of Purchaser's obligations under
the Agreement, including payment into escrow of the Consideration consisting of
$1,650,000 in cash;
WHEREAS, the Seller has concluded said governance proceeding and a consent
order dated January 20, 2006 has been entered by the Superior Court of New
Jersey Middlesex County (the "Consent");
WHEREAS, pursuant to the Consent, Seller agreed to receive the
Consideration in the form of $1,150,000 in cash and $500,000 in a convertible
promissory note;
WHEREAS, the Seller desires, and Purchaser agrees, to amend the Agreement
to properly reflect certain matters, including the Consideration agreed to in
the Consent.
NOW, THEREFORE, in consideration of the foregoing and the promises and
covenants contained herein, the sufficiency of which is hereby acknowledged, the
parties agree as follows:
TERMS AND CONDITIONS
1. Closing Consideration. Section 2(B) of the Agreement is hereby amended and
restated in its entirety to read as follows:
"B. Closing Consideration. ONE MILLION AND FOUR HUNDRED EIGHTY-FIVE
THOUSAND DOLLARS AND NO/100 ($1,485,000) upon satisfaction of all the
conditions in Section 5(B) as follows: (i) NINE HUNDRED EIGHTY FIVE
THOUSAND DOLLARS AND NO/100 ($985,000) by wire transfer, certified
check, or bank check or money order which sum shall be held in an
interest bearing escrow account, for the account of SELLER, and (ii)
the issuance of two-year convertible promissory notes in the aggregate
amount of FIVE HUNDRED THOUSAND DOLLARS AND NO/100 at approximately
eight percent (8%) annual interest rate, convertible into 158,000
shares of common stock of the PURCHASER at the end of the term of the
note at price per share of $3.165, in substantially the form attached
hereto as Exhibit D (the "Note"). Interest shall be payable quarterly
beginning May 15, 2006 at a rate of two percent (2%) of the principal
balance outstanding on each payment date. The funds under Section
2(B)(i) and the Note shall be held by the law firm of Xxxxxxxxxx and
Gubits, Esqs., pursuant to the Escrow Agreement until the Closing
Date, at which time such funds and the Note shall be released
forthwith to SELLER. All interest earned shall be payable to such
party hereto that is entitled to receive the Deposit as provided in
this Agreement."
2. Convertible Note. The "Form of Convertible Promissory Note" attached hereto
as Exhibit A is appended to the Agreement as Exhibit D.
3. Finders Fee. Seller agrees that any agent, finders or broker fee (the "Broker
Fee") it is obligated to pay upon consummation of the transaction contemplated
by the Agreement shall be Seller's sole responsibility. Seller shall defend,
indemnify and hold harmless Purchaser and its respective officers, directors,
stockholder, employees and agents from and against any and all losses, claims,
judgments, liabilities, demands, charges, suits, penalties, costs or expenses,
including court costs and attorney's fees with respect to or arising from the
Broker Fee.
4. Effectiveness; Continuity of Terms. This Amendment shall be effective when
executed by the Seller and Purchaser. All other terms and provisions of the
Agreement shall remain in full force and effect.
5. Governing Law. This Amendment shall be governed, construed and enforced in
accordance with the laws of the State of New York, without regard to the
principles of conflicts of laws.
6. Counterparts. This Amendment may be signed in counterparts, each of which
when taken together shall constitute one fully executed document.
SIGNATURES
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
and delivered by their proper and duly authorized officers as of the day and
year first above written.
SELLER:
ESTATE OF XXXXXX X. XXXXXXXXX
By: _________________________________
Xxxx Xxxxxxxxx, Administratrix
PURCHASER:
CHARTWELL INTERNATIONAL, INC.
By: __________________________
Xxxx Xxxxxxx, Chairman
By: __________________________
Xxxxxx Xxxxxxx, Director
EXHIBIT A
FORM OF CONVERTIBLE PROMISSORY NOTE
