EXHIBIT 2.5
PURCHASE AND SALE AGREEMENT
TWO PIZZA HUT RESTAURANTS
MARTINSBURG and FRONT ROYAL, VIRGINIA
PURCHASE AND SALE AGREEMENT
This PURCHASE AND SALE AGREEMENT ("Agreement") is entered into as of June,
______, 1996, by and between XXXXX X. XXXXX, an individual ("Seller"), and U. S.
RESTAURANT PROPERTIES OPERATING L. P., a Delaware limited partnership ("Buyer"),
and its assigns.
W I T N E S S E T H:
In consideration of the mutual covenants set forth herein, Seller and Buyer
agree as follows:
1. CONVEYANCE OF PROPERTY. On the terms and subject to the conditions
set forth in this Agreement, at Closing, as hereinafter defined, Seller shall
sell, convey and assign to Buyer, and Buyer shall buy and accept from Seller,
subject to the Permitted Encumbrances, as hereinafter defined, the properties
(the "Properties") designated on SCHEDULE 1 hereto, including the following:
(a) Good and indefeasible title in fee simple to the land (the
"Land"), located in Martinsburg and Front Royal, Virginia on which Pizza Hut
restaurants are located, together with all rights and interests appurtenant
thereto, including Seller's right, title, and interest in and to all adjacent
streets, alleys, rights-of-way and any adjacent strips or gores of real estate;
and buildings, structures and other improvements located on the Land
("Improvements");
(b) all of Seller's interest in the leases demising space in the
Improvements ("Leases") and the security deposits ("Deposits") made by tenant
("Tenants") holding under the Leases;
(c) to the extent assignable, all of Seller's interest in all
agreements (other than the agreements described elsewhere in this Section 1)
that relate to the ownership, maintenance and operation of the Properties
("Property Agreements") which Buyer agrees in writing to assume; and
(d) to the extent in Seller's possession and assignable, any and all
(i) plans, drawings, specifications, surveys, and other technical descriptions
("Plans"), (ii) warranties ("Warranties"), (iii) licenses or permits
("Licenses"), and (iv) telephone exchanges, trade names and marks, and other
identifying material pertaining to the Land and Improvements ("Intangible
Personal Property").
2. XXXXXXX MONEY. Within three (3) business days of the date both Buyer
and Seller execute and deliver this Agreement, Buyer shall deliver to
Commonwealth Land Title Company, 00000 Xxxxxx Xxxxxxx, Xxxxx 000, Xxxx Xxx 00,
Xxxxxx, Xxxxx 00000, Attn: Xxxxx Xxxxxx ("Title Company") $50.00 ("Non-
Refundable Xxxxxxx Money") in consideration for this Agreement and the
Inspection Period, as hereinafter defined. The Title Company shall immediately
deliver the Non-Refundable Xxxxxxx Money to Seller and the Non-Refundable
Xxxxxxx Money shall be retained by Seller in all
PURCHASE AND SALE AGREEMENT - PAGE 1
TWO PIZZA HUT RESTAURANTS IN VIRGINIA
events. In addition, the Buyer shall deposit $8,000.00 with Title Company
(the "Xxxxxxx Money"). The Xxxxxxx Money shall be deposited in escrow or
trust accounts that are interest-bearing, readily available, liquid and
federally insured to the full extent of the Xxxxxxx Money deposited therein
so that no portion of the Xxxxxxx Money shall ever be at risk. The Xxxxxxx
Money shall include any interest earned thereon. Title Company shall deliver
the Xxxxxxx Money only in accordance with this Agreement.
3. PURCHASE PRICE.
(a) The purchase price for the Property shall be $800,000.00 (the
"Purchase Price"), payable by delivery by Buyer of 32,000 units of limited
partnership (the "Units") of U. S. Restaurant Properties Master L. P., a
Delaware limited partnership (the "Partnership"). The Units will not be
registered under U. S. securities laws, but Buyer will obtain the registration
of the Units at its cost and expense within twelve (12) months after the Closing
Date. For purposes of determining the credit against the Purchase Price for
Units delivered hereunder, each Unit shall be valued at $25.00, and shall be
subject to the unit price guaranty of the Purchaser, attached as EXHIBIT G
hereto. The Purchase Price shall be paid to the Title Company and distributed
by the Title Company as designated by Seller. The Purchase Price shall be
adjusted as described in this Agreement.
(b) No proration shall be made of real estate and personal property
taxes, utility charges and maintenance expenses, since these expenses are
obligations of the Tenant pursuant to the Leases. Base Rent and Percentage Rent
pursuant to the Leases shall be prorated as of 11:59 o'clock p.m. on the Closing
Date.
4. DELIVERY OF DOCUMENTS BY SELLER. On or before the date which is
thirty (30) days following the date hereof, Seller shall deliver to Buyer the
following documents ("Documents"):
(a) All current and historical sales information provided to Seller
by the Tenants (the "Financial Statements");
(b) Commitment for title insurance covering the fee estates in the
Land and the Improvements ("Title Commitment") from the Title Company, setting
forth the status of the title of the Land and the Improvements, showing all
matters of record affecting the Land and the Improvements, together with a true,
complete, and legible copy of all documents referred to in the Title Commitment;
(c) Current "as-built" survey ("Survey") listing all easements and
encroachments affecting the Properties, parking spaces (including handicapped
designation), containing a flood plain certification, with sufficient detail to
obtain deletion of the standard survey exception in the Title Commitment; and
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TWO PIZZA HUT RESTAURANTS IN VIRGINIA
(d) copies of any (i) Warranties, (ii) Licenses, (iii) certificates
of occupancy for the Improvements, (iv) Plans, (v) Property Agreements, (vi)
engineering studies, but only to the extent in Seller's possession or obtainable
by Seller without undue expense.
5. RIGHT OF ENTRY AND INSPECTION.
(a) From the date hereof to the Closing Date, Seller shall afford
Buyer and its representatives a continuing right to inspect, at reasonable
hours, the Property, Documents, and all other documents or data pertaining to
the Properties, subject to the rights of Tenants under the Leases. Buyer shall
indemnify and hold Seller harmless from and against any loss, claim or liability
arising or resulting from the inspections made by Buyer. If Buyer, in its sole
and absolute discretion is not satisfied with the physical condition of the
Improvements, any matter in the Documents, or any matter in the information
available to Buyer concerning the Properties, Buyer may terminate this Agreement
in accordance with Section 14, by delivering written notice to Seller prior to
5:00 o'clock p. m. on the date that is thirty (30) days after the last to be
delivered of any of the Documents referenced in Sections 4(a) through 4(e)
hereof (such period, the "Inspection Period").
(b) Buyer's failure to terminate this Agreement by delivering the
notice by the time called for in Section 5(a) shall terminate Buyer's right to
terminate this Agreement under that Section.
6. TITLE. Buyer shall have the right, at any time during the Inspection
Period, to object in writing to any matters reflected by the Survey or the Title
Commitment. All matters to which Buyer objects are "Non-Permitted
Encumbrances". All matters to which such objection is not made are "Permitted
Encumbrances". Seller, at its sole cost and expense, shall have the right, but
not the obligation, to cure or remove all Non-Permitted Encumbrances within ten
(10) days following the expiration of the Inspection Period. If Seller does not
cause all of the Non-Permitted Encumbrances to be removed or cured within the
above described ten (10) day period, this Agreement shall automatically
terminate and Buyer shall receive a refund of the Xxxxxxx Money, unless Buyer,
in its sole discretion elects to purchase the Properties subject to the Non-
Permitted Encumbrances.
7. REPRESENTATIONS AND WARRANTIES. Seller hereby represents and warrants
to, and covenants with, Buyer that:
(a) Seller has the full right, power, and authority to execute,
deliver, and perform this Agreement, and this Agreement, when executed and
delivered by Seller and Buyer, shall constitute the valid and binding agreement
of Seller, and shall be enforceable against Seller in accordance with its terms.
(b) All requisite action on the part of Seller has been taken by
Seller in connection with making and entering into this Agreement and the
consummation of the purchase and sale provided for herein.
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(c) No attachments, execution proceedings, assignments for the
benefit of creditors, insolvency, bankruptcy, reorganization or other
proceedings are pending or, to the best of Seller's knowledge, threatened
against Seller, which would materially adversely affect the ability of Seller to
consummate the transactions contemplated by this Agreement.
(d) Seller has not received any written notice from appropriate
governmental authorities that either Property is in violation of any applicable
laws.
(e) Seller has not received any written notices from any insurance
company, board of fire underwriters or similar organization regarding any
defects in either Property.
(f) Seller has no knowledge of any litigation, or possible
litigation, or of claims of violations or noncompliance with applicable laws and
regulations affecting either Property, including regulations of the
Environmental Protection Agency and any state regulatory body concerning the
disposal of grease, hazardous waste, petroleum, any underground storage tanks or
any other hazardous materials, or regulations of the Americans Disability Act
providing for access to the premises, dining areas and bathroom areas of the
Properties ("Applicable Laws").
(g) Seller has no contracts of any kind, such as for waste disposal,
termite protection, cleaning services, or paper supplies which will survive the
Closing Date.
(h) Seller has received no written notice of taking, condemnation,
betterment or assessment, actual or proposed, with respect to either Property.
(i) No portion of either Property lies within any 100-year flood
plain.
(j) Except for the Permitted Encumbrances, Seller owns the Properties
free and clear of all liens, restrictions, charges and encumbrances. From the
date hereof until the Closing Date or earlier termination of this Agreement,
Seller will not sell, assign or create any right, title or interest whatsoever
in or to either Property or create or permit to exist any liens (other than
Permitted Encumbrances), encumbrances or charges thereon without discharging the
same prior to the Closing Date.
(k) Seller has no information or actual knowledge of any proposed
change in any of the Applicable Laws or any judicial or administrative action or
any action by adjacent land owners or any facts or conditions relating to either
Property which would materially and adversely affect, prevent or limit the use
of such Property as a restaurant.
(l) All Licenses and occupancy certificates necessary for the
operation and occupancy of each Property, including, but not limited to, all
building and use permits, have been obtained for all operations to date and
shall be maintained through Closing.
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TWO PIZZA HUT RESTAURANTS IN VIRGINIA
(m) Each Lease is in full force and effect, and Seller has no
knowledge of any event which would constitute a default or an event of default
either by Seller or Tenant under either Lease.
(n) From and after the date hereof, and until the Closing or earlier
termination of this Agreement, Seller shall not take any action, or omit to take
any action, which action or omission would have the effect of violating any of
the representations and warranties of Seller contained in this Agreement.
All representations and warranties made in this Agreement shall be
deemed to be made on the date hereof and again on the Closing Date. It shall be
a condition of Buyer's obligation to close that all warranties and
representations made hereunder are true on the Closing Date. If Buyer discovers
prior to Closing, that any representation or warranty made in this Agreement is
not true, then Buyer shall have the right, as its sole and exclusive remedies,
to either (i) terminate this Agreement in accordance with Section 14 by
delivering notice to Seller prior to the Closing Date, or (ii) elect to purchase
the Properties subject to such untrue warranty or representation without any
reduction in the Purchase Price.
8. CLOSING. The closing ("Closing") of the sale of the Property by
Seller to Buyer shall occur on the date fifteen (15) days following the last day
of the Inspection Period, or at such earlier date agreed to by Seller and Buyer
in writing (the date such Closing occurs is hereinafter referred to as the
"Closing Date"). Closing shall occur in the offices of the Title Company,
located at 00000 Xxxxxx Xxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, or at another
place and or time as mutually agreed upon by Seller and Buyer, commencing at
10:00 o'clock a. m. on the Closing Date. At Closing:
(a) Buyer shall deliver to Seller (i) the Purchase Price in
accordance with Section 3; (ii) evidence satisfactory to Seller and the Title
Company that the person executing documents on behalf of Buyer has full right,
power and authority to do so; and (iii) the Guaranty Agreement.
(b) Seller shall deliver or cause to be delivered to Buyer the
following ("Closing Documents"):
(i) Special Warranty Deed in the form of EXHIBIT B, conveying to
Buyer the Land and Improvements subject to the Permitted Encumbrances;
General Assignment in the form of EXHIBIT C; Xxxx of Sale in the form of
EXHIBIT D; and IRC Section 1445 Certification in the form of EXHIBIT E;
original Estoppel Certificate in the form of EXHIBIT I; all fully executed,
sworn to, and acknowledged, as appropriate, by Seller;
(ii) Evidence satisfactory to Buyer and Title Company that the
person or persons executing the Closing Documents on behalf of Seller have
full right, power and authority to do so;
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TWO PIZZA HUT RESTAURANTS IN VIRGINIA
(iii) The originals (to the extent in Seller's possession) of
the Leases, all Property Agreements, Warranties, Licenses and Plans; and
(iv) An Investment Letter substantially in the form of EXHIBIT H,
hereto.
(c) Seller shall be responsible for the costs of obtaining the
Survey. Buyer shall pay for the Phase I Report on the Properties. Buyer and
Seller shall share the costs of the Title Commitment, the Owner's Policy of
title insurance, any transfer taxes or deed stamp taxes, and any escrow and
recording costs.
(d) Each of Seller and Buyer shall pay its own legal fees incurred in
connection with this Agreement; provided, however, that if a suit is filed by
Buyer or Seller alleging a breach hereof or default hereunder, the non-
prevailing party shall pay all reasonable legal fees of the prevailing party
resulting from such suit.
(e) Seller shall deliver to Buyer possession of the Property.
(f) The Title Company shall deliver to Buyer the Xxxxxxx Money.
9. OPERATION OF PROPERTY. From the date hereof until Closing, Seller
warrants that it shall maintain and operate the Property in a manner consistent
with its past maintenance and operation.
10. NOTICES. Any notice provided or permitted to be given under this
Agreement must be in writing and may be served by depositing same in the United
States mail, addressed to the party to be notified, postage prepaid and
certified, with return receipt requested, by delivering the same in person to
such party, or by delivering the same by confirmed facsimile. Notice given in
accordance herewith shall be effective upon the earlier of receipt at the
address of the addressee or on the second (2nd) day following deposit of same in
the United States mail as provided for herein, regardless of whether same is
actually received. For purposes of notice, the addresses of the parties shall
be as follows:
If to Buyer, to: U. S. Restaurant Properties, Inc.
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 000, XX 168
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxxxx
With copy to: Xxxxxxx X. Xxxxxxxx, Esq.
Middleberg Xxxxxx & Gianna
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
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TWO PIZZA HUT RESTAURANTS IN VIRGINIA
If to Seller, to: Xx. Xxxxx X. Xxxxx
c/o Sasnack Management Corporation
0000 Xxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxx 00000
Either party may change its address for notice by giving ten (10) days prior
written notice thereof to the other party.
11. BROKERAGE COMMISSIONS. Buyer shall defend, indemnify, and hold
harmless Seller from any claim by any party claiming under Buyer for any
brokerage, commission, finder's, or other fees relative to this Agreement or the
sale of the Property, and any court costs, attorneys' fees, or other costs or
expenses arising therefrom and alleged to be due by authorization of Buyer.
Seller shall defend, indemnify and hold harmless Buyer from any claim by any
party claiming under Seller for any brokerage, commission, finder's, or other
fees relative to this Agreement or the sale of the Property, and any court
costs, attorneys' fees, or other costs or expenses arising therefrom and alleged
to be due by authorization of Seller.
12. ASSIGNS. This Agreement shall inure to the benefit of and be binding
on the parties hereto and their respective heirs, legal representatives,
successors and assigns. This Agreement may be assigned by Buyer without the
consent of Seller by delivery of written notice of assignment to Seller.
13. DESTRUCTION, DAMAGE OR TAKING BEFORE CLOSING. In the event of damage
to or destruction of all or any portion of any Property by fire or other
casualty, Seller shall promptly notify Buyer. If Seller reasonably estimates
that $50,000.00 or less is required to be expended to repair or restore the
damaged or destroyed Property or portion thereof ("Repair Cost"), this Agreement
shall remain in full force and effect, and Seller shall, at its option, either
(i) repair such damage or destruction, or, if such damage or destruction has not
been repaired prior to Closing, (ii) require Buyer to take title to the
Property, assign to Buyer all available casualty insurance proceeds and
indemnify Buyer (in form and content satisfactory to Buyer) for all costs and
expenses of repair in excess of available insurance proceeds. If Seller
reasonably estimates that the Repair Cost exceeds $50,000.00, Buyer shall have,
as its sole and exclusive remedies, (i) the option to terminate this Agreement
in accordance with Section 14 within ten (10) business days after its receipt of
notice from Seller as set forth above, by notice in writing to Seller, or (ii)
if Buyer does not elect to terminate, this Agreement shall remain in full force
and effect, Buyer shall take title to the Property subject to such damage to or
destruction, with an assignment by Seller to Buyer of all available casualty
insurance proceeds. In the event of an eminent domain taking or the issuance of
a notice of an eminent domain taking with respect to all or any portion of the
Property, Seller shall promptly notify Buyer. Buyer shall have, as its sole and
exclusive remedies, (i) the option to terminate this Agreement in accordance
with Section 14 within ten (10) business days after its receipt of such notice
from Seller, by notice in writing to Seller, or (ii) if Buyer does not elect to
terminate this Agreement, this Agreement shall remain in full force and effect,
Buyer shall be obligated to consummate this transaction for the full Purchase
Price, and Buyer shall be entitled to
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TWO PIZZA HUT RESTAURANTS IN VIRGINIA
receive all eminent domain awards and, to the extent the same may be necessary
and appropriate, Seller shall assign to Buyer at Closing Seller's rights to such
awards. In no event shall the Purchase Price be reduced, except to the extent
of any deductible amounts payable in connection with insurance proceeds assigned
by Seller to Buyer.
14. TERMINATION AND REMEDIES.
(a) If Buyer fails to consummate the purchase of the Properties
pursuant to this Agreement for any reason other than termination hereof pursuant
to a right granted to Buyer in Sections 5, 6, 7, or 13, then Seller, as its sole
and exclusive remedy, shall have the right to terminate this Agreement by
notifying Buyer thereof, in which event the Title Company shall deliver to
Seller, as liquidated damages, the Xxxxxxx Money, whereupon neither Buyer nor
Seller shall have any further rights or obligations hereunder. Seller and Buyer
hereby acknowledge and agree they have included the provision for payment of
liquidated damages because, in the event of a breach by Buyer, the actual
damages incurred by Seller can reasonably be expected to approximate the amount
of liquidated damages called for, and because the actual amount of such damages
would be difficult if not impossible accurately to measure.
(b) If Seller fails to consummate the sale of the Property pursuant
to this Agreement for any reason other than (i) termination hereof by Buyer
pursuant to Sections 5, 6, 7, or 13 or (ii) Buyer's failure to perform its
obligations hereunder, Buyer shall have the right, as its sole and exclusive
remedies, to terminate this Agreement by notifying Seller thereof, in which case
the Title Company shall deliver the Xxxxxxx Money to Buyer, whereupon neither
party hereto shall have any further rights or obligations hereunder.
(c) If Buyer terminates this Agreement pursuant to a right granted
Buyer in Section 5, 6, 7, or 13, then the Title Company shall deliver the
Xxxxxxx Money to Buyer whereupon neither Buyer or Seller shall have any further
rights or obligations hereunder.
15. MISCELLANEOUS. Each of Buyer and Seller agrees with the other that it
has no present intention to make any public announcement of the purchase and
sale transaction contemplated hereby or of any of the terms thereof, and shall
obtain the written consent of the other party prior to making any announcment
or divulging any information. Both Seller and Buyer shall cooperate with one
another and in a timely manner execute all documents reasonably required to give
effect to the purchase and sale provided for herein. If any provision of this
Agreement is adjudicated by a court having jurisdiction over a dispute arising
herefrom to be invalid or otherwise unenforceable for any reason, such
invalidity or unenforceability shall not affect the other provisions hereof.
This Agreement shall be governed and construed in accordance with the laws of
the State of Texas. This Agreement is the entire agreement between Seller and
Buyer concerning the sale of the Property and no modification hereof or
subsequent agreement relative to the subject matter hereof shall be binding on
either party unless reduced to writing and signed by the party to be bound. The
provisions of Sections 3, 7, 8, and 11 shall
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survive Closing. EXHIBITS A-I attached hereto are incorporated herein by this
reference for all purposes. Time is of the essence in the performance of each
and every provision of this Agreement. In the event that the last day for
taking any action or serving notice under this Agreement falls on a Saturday,
Sunday or legal holiday, the time period shall be extended until the
following business day.
16. DATE OF AGREEMENT. All references in this Agreement to "the date
hereof" or similar references shall be deemed to refer to the last date, in
point of time, on which all parties hereto have executed and received a fully
executed copy of this Agreement. This Agreement constitutes an offer by Buyer
to purchase the Properties on the terms and conditions and for the Purchase
Price specified herein. Unless sooner terminated or withdrawn by notice in
writing to Seller, this offer shall lapse and terminate at the close of Buyer's
business day on ten (10) days following execution of this Agreement by Buyer,
unless, prior to such time, Seller has returned to Buyer two (2) fully executed
copies of this Agreement.
IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of the
date first set forth above.
BUYER:
U. S. RESTAURANT PROPERTIES OPERATING L. P.
By: U. S. RESTAURANT PROPERTIES, INC.
By:
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Name:
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Title:
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SELLER:
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By:
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Name:
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Title:
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The undersigned hereby executes this Agreement for the sole purpose of (i)
acknowledging receipt of the Xxxxxxx Money and the Non-Refundable Xxxxxxx Money
and (ii) to evidence its agreement to hold the Non-Refundable Xxxxxxx Money and
the Xxxxxxx Money in trust for the parties hereto in accordance with the terms
of this Agreement.
TITLE COMPANY:
COMMONWEALTH LAND TITLE COMPANY
By:
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Name:
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Title:
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Date of Execution:
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ATTACHMENTS:
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Exhibit A - Intentionally Deleted
Exhibit B - Special Warranty Deed
Exhibit C - General Assignment
Exhibit D - Xxxx of Sale
Exhibit E - IRC Section 1445 Certification
Exhibit F - Intentionally Deleted
Exhibit G - Guaranty Agreement
Exhibit H - Investment Letter
Exhibit I - Estoppel Certificate
Schedules and Exhibits Omitted
