ASSIGNMENT AND ASSUMPTION OF
PURCHASE AND SALE AGREEMENT
(EAGLE RIDGE)
THIS ASSIGNMENT AND ASSUMPTION OF PURCHASE AND SALE AGREEMENT (this
"Assignment Agreement") is made and entered into as of the 20th day of May, 1998
(the "Effective Date"), by and between TROON EAGLE RIDGE LLC, a Delaware limited
liability company ("Assignor"), and GOLF TRUST OF AMERICA, L.P., a Delaware
limited partnership ("Assignee").
THE PARTIES ENTER THIS ASSIGNMENT AGREEMENT on the basis of the
following facts, understandings and intentions:
A. Assignor and Eagle Ridge, L.P., a Delaware limited partnership
("Seller"), have entered into that certain Purchase and Sale Agreement dated as
of March 12, 1998 (the "Purchase Agreement"), whereby Assignor agreed, subject
to certain terms and conditions set forth therein, to acquire from Seller that
certain real property, and improvements located thereon, as more particularly
described in the Purchase Agreement (the "Property"). Capitalized terms used
herein without definition shall have the meanings ascribed to such terms in the
Purchase Agreement.
B. Assignor desires to assign to Assignee, and Assignor desires to
assume from Assignor, Assignor's right and obligation to acquire the Property,
together with Assignor's right, title and interest in, to and under the Purchase
Agreement on the terms and conditions set forth herein.
C. At Closing, and in partial consideration of the terms and
conditions of this Assignment Agreement, including, without limitation, the
obligation of Assignor to deliver the Lease (defined below) to Assignee at
Closing, Assignee will convey ________ units of limited partnership interests in
Assignee [$1,198,750 divided by the average closing price of common stock of
Golf Trust of America, Inc. for the five days prior to Closing] (the "Owner's
Shares"), in a private placement offering (the "Offering").
D. The rights and preferences of holders of the Owner's Shares are
summarized in the final Prospectus of Golf Trust of America, Inc. (the
"Company") dated November 4, 1997, and the documents incorporated therein, and
all documents filed by the Company with the United States Securities and
Exchange Commission (the "Commission") pursuant to the Securities Exchange Act
of 1934 (the "Act") (collectively, the "Offering Documents").
NOW, THEREFORE, for and in consideration of the mutual covenants
contained herein and other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged,
Assignor and Assignee hereby agree as follows:
1. ASSIGNMENT AND ASSUMPTION. As of the Effective Date, Assignor
hereby assigns and transfers to Assignee, all of Assignor's right, title and
interest in, to and under the Purchase Agreement, and, subject to Section 2 of
this Assignment Agreement, Assignee hereby accepts Assignor's assignment and
assumes all of Assignor's duties, obligations and responsibilities arising under
the Purchase Agreement arising from and after the Effective Date. Nothing
contained in this Assignment Agreement shall release Assignor from any of its
obligations under the Purchase Agreement.
2. OBLIGATIONS NOT ASSUMED BY ASSIGNEE. Notwithstanding anything to
the contrary contained in this Assignment Agreement, Assignee shall not assume
the following obligations of Assignor under the Purchase Agreement:
(i) to purchase certain vehicles (including jet skis and paddle
boats) as listed on Exhibit A attached hereto and incorporated
herein by reference;
(ii) to assume Seller's rights and obligations under the Rental Home
Agreements (as defined in the Purchase Agreement).
The foregoing obligations shall specifically be retained by Assignor. The
parties agree that the vehicles (as described in subsection (i)) and the rights
and obligations under the Rental Home Agreements (as described in subsection
(ii)) shall be pledged to Assignee.
3. DELIVERIES AT CLOSING. At Closing, Assignor and Assignee shall
make the following payments and deliveries:
a. ASSIGNOR PAYMENTS. Assignor shall pay or deliver into the
Escrow Fund the balance of the closing costs, escrow and investment fees
required to be paid by Purchaser (as defined in the Escrow Agreement) pursuant
to the Escrow Agreement (after giving effect to Assignee's payment pursuant to
Section 3(b)(ii)), and shall pay or deliver to Assignee the Secondary Collateral
(as defined in the Lease).
b. ASSIGNEE PAYMENTS. Assignee shall pay or deliver (i) to
Seller through escrow $44,000,000 in same day funds, and wired to an account
designated by Escrow Holder, (ii)
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an amount equal to Two Hundred Twenty Six Thousand Two Hundred Fifty Dollars
($226,250) in closing costs, escrow and investment fees required to be paid by
Purchaser pursuant to the Escrow Agreement and (ii) to Assignor the Owner's
Shares.
c. MUTUAL DELIVERY. Assignee shall deliver to Assignor an
executed counterpart of that certain amended and restated limited partnership
agreement relating to Assignee.
4. REPRESENTATIONS AND WARRANTIES REGARDING THE PURCHASE AGREEMENT.
Assignor hereby represents and warrants to Assignee that: (i) there has been no
prior assignment by Assignor of the Purchase Agreement; (ii) there has occurred
no default under the Purchase Agreement on the part of Assignor or, to
Assignor's actual knowledge, on the part of Seller; and (iii) Assignee may rely
on all of the representations and warranties made by Assignor to Seller pursuant
to Article IV of the Purchase Agreement.
5. REPRESENTATIONS AND WARRANTIES REGARDING ACQUISITION OF THE
OWNER'S SHARES. In connection with the acquisition of the Owner's Shares by
Assignor, Assignor makes the following representations and warranties for the
benefit of Assignee and the Company:
a. Assignor represents that it is an "accredited investor" as
such term is defined in Rule 501 ("Rule 501") of Regulation D promulgated under
the Act and that it is able to bear the economic risk of an investment in the
Owner's Shares.
b. Assignor acknowledges that it has prior investment
experience, including investment in non-listed and non-registered securities,
and the ability and expertise to evaluate the merits and risks of such an
investment on its behalf.
c. Assignor hereby represents that it has (i) received the
Offering Documents and (ii) carefully reviewed the Offering Documents.
d. Assignor hereby represents that it has been furnished by
Assignee during the course of this transaction with all information regarding
the Company which it has requested or desired to know; that it has been afforded
the opportunity to ask questions of, and receive answers from, duly authorized
officers or other representatives of the Company concerning the terms and
conditions of the Offering, and has received any additional information which it
has requested.
e. Assignor hereby acknowledges that the offering of Owner's
Shares has not been reviewed by, and the fairness of such Owner's Shares has not
been determined by, the Commission or any state regulatory authority, since the
Offering
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is intended to be a nonpublic offering pursuant to Section 4(2) of the Act.
Assignor represents that the Owner's Shares being acquired by it are being
acquired for its own account, for investment and not for distribution of the
Owner's Shares to others.
f. Assignor understands that the Owner's Shares have not been
registered under the Act or any state securities or "blue sky" laws and are
being sold in reliance on exemptions from the registration requirements of the
Act and such laws.
g. The undersigned, if acting in a representative or fiduciary
capacity, has full power and authority to execute and deliver this Assignment
Agreement, to make the representations and warranties specified herein, and to
consummate the transactions contemplated herein on behalf of the subscribing
partnership, trust, corporation or other entity for which the undersigned is
acting and such partnership, trust, corporation, or other entity has full right
and power to subscribe for Shares and perform its obligations pursuant to this
Assignment Agreement.
h. The Company may rely, and shall be protected in acting upon,
any papers or other documents which may be submitted to it by the Assignor in
connection with the Owner's Shares and which are believed by it to be genuine
and to have been signed or presented by the proper party or parties, and the
Company shall not have any liability or responsibility with respect to the form,
execution or validity thereof.
i. Assignor hereby represents that the address set forth on
Page 1 of the Purchase Agreement is Assignor's principal business address.
j. The foregoing representations, warranties and agreements,
together with all other representations and warranties made or given by the
undersigned to Assignee or the Company in any other written statement or
document delivered in connection with the transactions contemplated hereby,
shall be true and correct in all respects on and as of the date of this
Assignment Agreement as if made on and as of such date and shall survive such
date and if there should be any material change in such information prior to the
Closing, the undersigned will immediately furnish such revised or corrected
information to Assignee. Assignor understands that Assignee and the Company
will rely upon the accuracy and truth of the foregoing representations,
warranties and agreements, and Assignor hereby consents to such reliance.
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6. LEASE, PLEDGE AGREEMENTS AND DEVELOPMENT AGREEMENT.
a. As a condition to Assignee's performance of its obligations
under this Assignment Agreement, at Closing Assignor shall deliver to Assignee
executed counterparts of a lease in the form attached hereto as EXHIBIT B (the
"Lease"), pledge agreements in the forms attached to the Lease as EXHIBITS D and
E (the "Pledge Agreements"), (iii) a pledge agreement in a form agreed by the
parties with respect to the items listed in Section 2(i) and (ii) above, (iv) a
recordable development agreement with respect to the Additional Parcels
substantially in the form attached hereto as EXHIBIT C (the "Development
Agreement"), and (v) a Mortgage with respect to the Additional Parcels in the
form attached to the Lease as EXHIBIT K (the items listed in subsections (i)
through (v) above being, the "Security Agreements").
b. As a condition to Assignor's performance of its obligations
under this Assignment Agreement, at Closing, Assignee shall deliver to Assignor
executed counterparts of the Security Agreements.
7. INDEMNITY. Assignor shall indemnify and hold Assignee harmless
from and against all claims, demands, losses, damages, expenses and costs
including, but not limited to, reasonable attorneys' fees and expenses actually
incurred, arising out of or in connection with Assignor's failure to observe,
perform and discharge each and every one of the covenants, obligations and
liabilities of "Purchaser" under the Purchase Agreement to be observed,
performed or discharged on, or relating to, or accruing with respect to the
period prior to the date of this Assignment Agreement. Assignee shall indemnify
and hold Assignor harmless from and against all claims, demands, losses,
damages, expenses and costs including, but not limited to, reasonable attorneys'
fees and expenses actually incurred, arising out of or in connection with
Assignee's failure, from and after the date of this Assignment Agreement, to
observe, perform and discharge each and every one of the covenants, obligations
and liabilities assumed by Assignee with respect to the Purchase Agreement and
relating to the period from and after the date of this Assignment Agreement.
8. FAILURE TO CONSUMMATE PURCHASE AGREEMENT.
The following subsections (a)-(d) shall be in effect from and after May 22,
1998 until Closing:
(a) If Assignee and Assignor decide to terminate the Purchase Agreement
prior to Closing for a failure of condition or occurrence of any other event
permitting Assignee and Assignor to terminate the Purchase Agreement and recover
the Initial Deposit without penalty (a "Permitted Termination Condition"),
Assignee
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shall receive a seventy-five percent (75%) share of the Initial Deposit, and
Assignor shall receive a twenty-five percent (25%) share of the Initial Deposit.
(b) If Assignee decides not to consummate the Purchase Agreement for any
reason other than a Permitted Termination Condition, Assignor shall have the
right to consummate the transaction with a third party. If Assignor consummates
the transaction with a third party and gets a credit in the amount of at least
One Million Dollars ($1,000,000) for the Initial Deposit, Assignor shall pay
$750,000 to Assignee upon the closing of such transaction. If Assignor is
unable to so consummate the transaction with a third party, Assignee shall pay
$250,000 to Assignor.
(c) If Assignor decides not to consummate the Purchase Agreement for any
reason other than a Permitted Termination Condition, Assignee shall have the
right, pursuant to this Assignment, to consummate the transaction with a third
party. If Assignee consummates the transaction with a third party and gets a
credit in the amount of at least One Million Dollars ($1,000,000.00) for the
Initial Deposit, Assignee shall pay $250,000 to Assignor upon the closing of
such transaction. If Assignee notifies Assignor of its intention to proceed
with the transaction, Assignor shall have no obligation to pay $750,000 to
Assignee. If Assignee does not so notify Assignor, Assignor shall pay $750,000
to Assignee.
(d) If there occurs a material Permitted Termination Condition, and one of
Assignee or Assignor desires to waive such Permitted Termination Condition and
proceed with the Closing (the "Waiving Party"), and the other desires to
terminate the Purchase Agreement (the "Terminating Party"), the Waiving Party
shall have the right to consummate the transaction with a third party, and shall
be obligated to pay to the Terminating Party, whether any such transaction is
consummated or not, the amount of Terminating Party's share of the Initial
Deposit (as set forth in subsection (a) above).
9. NOTICES. All notices, consents, approvals, waivers, and
elections which any party shall be required or shall desire to make or give
under this Assignment Agreement shall be in writing and shall be sufficiently
made or given only when sent by (a) certified mail, return receipt requested,
(b) prepaid overnight delivery service with proof of delivery, or (c) electronic
transmission with hard copy to follow as confirmation of receipt, addressed:
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to Assignor: Troon Eagle Ridge LLC
00000 X. Xxxxxxxx-Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to: Xxxxxxx Xxxxxx, Esq.
Xxxxx Xxxxx & Xxxxx
0000 Xxxxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
to Assignee: Golf Trust of America, L.P.
00 Xxxxx Xxxxx'x Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: W. Xxxxxxx Xxxxx, XX
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to: O'Melveny & Xxxxx LLP
Embarcadero Center West
000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
10. GOVERNING LAW. This Assignment Agreement shall be construed and
enforced in accordance with and governed by the laws of the State of Illinois.
11. BINDING EFFECT. This Assignment Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
executors, personal representatives, successors and assigns.
12. COUNTERPARTS. This Assignment Agreement may be executed in any
number of counterparts, which counterparts, when considered together, shall
constitute a single, binding, valid and enforceable agreement.
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IN WITNESS WHEREOF, Assignor and Assignee have executed this
Assignment Agreement as of the day and year first above written.
ASSIGNEE:
GOLF TRUST OF AMERICA, L.P.,
a Delaware limited partnership
By: GTA GP, Inc.,
a Maryland corporation
Its: General Partner
By:
------------------------
W. Xxxxxxx Xxxxx, XX
President and CEO
ASSIGNOR:
TROON EAGLE RIDGE LLC,
a Delaware limited liability company
By: TROON EAGLE RIDGE, INC.
Its: Member
By:
------------------
Its:
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EXHIBIT A
VEHICLES
All those certain vehicles to be transferred to Purchaser under the Purchase
Agreement, including without limitation, jet skis and paddleboats but excluding
golf carts.
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EXHIBIT B
LEASE
X-0
XXXXXXX X
XXXXXXXXXXX XXXXXXXXX
X-0
