ASSET PURCHASE AGREEMENT
This
Asset Purchase Agreement (this "Agreement") is made and
entered into as of this 15th day of December 2009 (the “Execution Date”), by and
between PRICE CHOPPER OPERATING CO., INC. ("Buyer"), a New York
corporation or its assignee(s), having its principal place of business at 000
Xxxxxxxxxx Xxxx, Xxxxxxxxxxx, Xxx Xxxx 00000, and THE PENN TRAFFIC COMPANY
("Seller"), a Delaware
corporation, as successor to P & C Food Markets, Inc., having a place of
business at 0000 Xxxxx Xxxx Xxxxxxxxx, X.X. Xxx 0000, Xxxxxxxx, Xxx Xxxx 00000.
Capitalized terms used in this Agreement are defined or cross-referenced in
Exhibit A.
A. On
November 18, 2009 (the “Petition Date”), Seller
commenced a voluntary case for reorganization (the “Bankruptcy Case”) under
Chapter 11 of the Bankruptcy Code, 11 U.S.C. §
§ 101 et seq. (the
“Bankruptcy Code”), in
the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) and
docketed as Case No. 09-14078 (PJW).
B. Seller
operates, among others, the following supermarkets:
1. Store
# 3188 located in Massena, New York (the “Massena
Supermarket”);
2. Store
# 3125 located in Potsdam, New York (the “Potsdam
Supermarket”);
3. Store
# 3090 located in Canton, New York, which also contains a pharmacy (the “Canton
Supermarket”);
4. Store
#3060 located in Gouverneur, New York (the “Gouverneur Supermarket
”);
5. Store
# 3104 located in Pulaski, New York, which also contains a pharmacy (the “Pulaski
Supermarket”);
6. Store
# 3106 located in Baldwinsville, New York on Xxxxxx Street, which also contains
a pharmacy (the “Baldwinsville
Supermarket”);
7. Store
# 3077 located in Camillus, New York at 5335 W. Genesee (the “Camillus
Supermarket”);
8. Store
# 3141 located in Fayetteville, New York, which also contains a pharmacy (the
“Fayetteville
Supermarket”);
9. Store
# 3012 located in Syracuse, New York on Nottingham Road (the “Syracuse Nottingham
Supermarket”);
10. Store
# 3140 located in Syracuse, New York on Brewerton Road, which also contains a
pharmacy (the “Syracuse
Brewerton Supermarket”);
11. Store
# 3127 located in Camden, New York (the “Camden
Supermarket”);
12. Store
# 3068 located in Canastota, New York, which also contains a pharmacy (the “Canastota
Supermarket”);
13. Store
# 3066 located in Cazenovia, New York (the “Cazenovia
Supermarket”);
14. Store
# 3103 located in Chittenango, New York (the “Chittenango
Supermarket”);
15. Store
# 3117 located in Manlius, New York (the “Manlius
Supermarket”);
16. Store
# 3114 located in Skaneateles, New York, which also contains a pharmacy (the
“Skaneateles
Supermarket”);
17. Store
# 3171 located in Penn Yan, New York, which also contains a pharmacy (the “Penn Yan Supermarket
”);
18. Store
# 3105 located in W. Carthage, New York, which also contains a pharmacy (the
“W. Carthage
Supermarket”);
19. Store
# 3070 located in Sherrill, New York, which also contains a pharmacy (the “Sherrill
Supermarket”);
20. Store
# 3157 located in Lincoln, New Hampshire (the “Lincoln
Supermarket”);
21. Store
# 3211 located in Bradford, Vermont (the “Bradford Supermarket”);
and
22. Store
# 3194 located in Towanda, Pennsylvania (the “Towanda
Supermarket”).
The 22
supermarkets listed above, including the associated pharmacies (the “Pharmacies”), are
collectively are referred to herein as the “Supermarkets.”
C. Buyer
desires to purchase certain of the assets used in the operation of the
Supermarkets and assume the Assumed Liabilities from Seller, and Seller desires
to sell, convey, assign and transfer to Buyer such assets used in the operation
of the Supermarkets, together with the Assumed Liabilities on the terms and
conditions set forth in this Agreement, all in the manner and subject to the
terms and conditions set forth in this Agreement and in accordance with sections
105, 363 and 365 and other applicable provisions of the Bankruptcy Code and the
Bankruptcy Rules, the Federal Rules of Bankruptcy Procedures and Local Rules of
the Bankruptcy Court (the “Bankruptcy
Rules”).
D. The
Supermarkets and Assumed Liabilities are assets and liabilities of Seller and
are to be purchased and assumed by Buyer pursuant to an order, in a form
reasonably acceptable to the parties (the “Bankruptcy Sale Order”),
approving such sale pursuant to sections 105, 363 and 365 of the Bankruptcy
Code, free and clear of liens, claims, encumbrances and interests, except for
the Assumed Liabilities, which order will include the authorization for the
assumption by Seller and assignment to Buyer of the Acquired Contracts and
liabilities thereunder in accordance with section 365 of the Bankruptcy Code,
including cure obligations, all in the manner and subject to the terms and
conditions set forth in this Agreement and the Bankruptcy Sale Order, and in
accordance with other applicable provisions of the Bankruptcy Code and
Bankruptcy Rules.
E. All
capitalized terms and phrases not defined above and as used below shall have
those meanings or definitions ascribed to each as set forth in Exhibit A
appended hereto and made a part hereof.
ARTICLE
1. PURCHASE
AND SALE OF THE ACQUIRED ASSETS
SECTION
1.1 Transfer of
Acquired Assets. At the Closing, and upon the terms and conditions set
forth in this Agreement, Seller shall sell to Buyer, and Buyer shall acquire
from Seller, all right, title and interest of Seller in, to and under the
Acquired Assets, free and clear of all Liens, Claims and interests including
pursuant to section 363(f) of the Bankruptcy Code. “Acquired Assets” shall mean
the following assets of Seller used in connection with its business at the
Supermarkets, but excluding the Excluded Assets:
(a) the
equipment, machinery, tools, implements, displays, furniture, fixtures and
improvements of Seller used by Seller in connection with its business at the
Supermarkets, including but not limited to items listed on Schedule 1.1(a) (the
“Owned Machinery and
Equipment”);
(b) the
Supermarket Buildings;
(c) the
Supermarket Land, which is owned by the Seller, for the following Supermarkets
(and to the extent that any of the following properties are leased and not owned
by the Seller, they shall be included in section 1.1(d) below):
1. The
Gouverneur Supermarket;
2. The
Pulaski Supermarket;
3. The
Baldwinsville Supermarket;
4. The
Fayetteville Supermarket;
5. The
Syracuse Nottingham Supermarket;
6. the
Syracuse Brewerton Supermarket;
7. The
Camden Supermarket;
8. The
Canastota Supermarket;
9. The
Cazenovia Supermarket;
10. The
Chittenango Supermarket;
11. The
Skaneateles Supermarket;
12. The
Penn Yan Supermarket;
13. The
X. Xxxxxxxx Supermarket;
14. The
Lincoln Supermarket;
15. The
Bradford Supermarket; and
16. The
Towanda Supermarket
(d) those
Contracts listed on Schedule 1.1(d) as an Acquired Contract (collectively, the
“Acquired
Contracts”);
(e) the
Pharmacy Records including access to computer files in respect
thereto;
(f) the
unexpired Pharmacy Inventory, all supplies and other inventories not held for
resale and all other items of personal property not specifically excluded below;
and
(g) phone
numbers for the Supermarkets, including the Pharmacies.
SECTION
1.2 Excluded
Assets. Notwithstanding anything to the contrary in this
Agreement, no other assets owned or used by Seller shall be included in the
Acquired Assets (all such properties and assets not being acquired by Buyer
being referred to as the “Excluded Assets”). Without
limiting the generality of the foregoing, the Excluded Assets shall
include the following assets:
(a) all
Cash;
(b) all
Accounts Receivable;
(c) all
Inventory held for resale to the public, other than the unexpired Pharmacy
Inventory;
(d) all
Intellectual Property, excluding phone numbers for the Supermarkets;
and
(e) the
equipment listed on Schedule 1.2(e).
SECTION
1.3 Assumption of
Liabilities. At the Closing consistent with the Debtors’ Cure Notice and
the Bankruptcy Sale Order, Seller shall pay all cure obligations (the ”Cure Amounts”) and assume and
assign to Buyer the Acquired Contracts after the Closing Date. Buyer shall
assume, and thereafter pay, perform and discharge, when due, all liabilities and
obligations of Seller with respect to Acquired Contracts first arising after the
Closing Date, which liabilities and obligations are required to be paid by Buyer
in accordance with section 365(k) of the Bankruptcy Code (the “Assumed Liabilities”). The
Cure Amounts include all items of additional rent, including without limitation,
percentage rents, common area maintenance charges, prorated taxes or other
charges for which the Seller may be liable to any landlord are the
responsibility of the Seller up to the Closing Date.
SECTION
1.4 Retention of
Liabilities. Buyer is assuming only the Assumed Liabilities and is not
assuming any other liability or obligation of Seller of whatever nature, whether
presently in existence or arising hereafter, including without limitation any
Claims asserted or unasserted, known or unknown for injuries to persons or
property which are related to circumstances or events that predate the Closing
of the transaction contemplated hereunder. All such other liabilities and
obligations shall be retained by and remain liabilities and obligations of
Seller (all such liabilities are, collectively, the “Excluded Liabilities”).
Without limiting the foregoing, except as expressly provided by Section 1.3
above, neither the Buyer or its Affiliates will be deemed to have assumed or be
liable for; (i) any capitalized leases not included in the Acquired Contracts,
long-term debt, current liabilities, or any other liabilities of the Seller
whether or not reflected on the balance sheets of the Seller or its bankruptcy
schedules; (ii) any intercompany liabilities or amounts due to Seller’s
Affiliates; (iii) any liabilities of the Seller or any of its Affiliates or any
employee retirement, deferred compensation, health, welfare or other benefit
plan or program to or with respect to any former or current employees; (iv) any
liabilities of Seller or its Affiliates accruing or arising on or before the
Closing Date, unless expressly set forth in Section 1.3 above; (v)
any liability or obligation of the Seller to any broker, finder or
similar party; and (vi) all cure amounts including all additional items of rents
as described in Section 1.3 above owed by Seller, whether accrued or invoiced,
up to the Closing Date.
ARTICLE
2.
CONSIDERATION
SECTION
2.1 Purchase
Price. The aggregate consideration for the sale, transfer, assignment and
conveyance of the Acquired Assets will be (a) $54,000,000 in cash (the “Purchase Price”), and (b) the
assumption by Buyer of the Assumed Liabilities (such assumption, together with
the Purchase Price, the “Total
Consideration”), provided, that if
damage or casualty to the Acquired Assets is equal to or less than $500,000 in
the aggregate, the Total Consideration otherwise payable by Buyer shall be
reduced by the amount that such damage or casualty less than $500,000. The
Purchase Price shall be payable in accordance with Section 3.3(a). The Buyer, in
its sole and absolute discretion may delete any Acquired Asset without reducing
the Purchase Price.
SECTION
2.2 Buyer’s
Deposit. Buyer shall deliver an xxxxxxx money deposit of
$5,400,000 (the “Buyer’s
Deposit”), unless a different sum is required by order of the Bankruptcy
Court, to counsel for Seller within one (1) Business Day of the Execution Date.
Such deposit shall be held in escrow in an interest bearing account, with
accrued interest added to the Buyer’s Deposit.
ARTICLE
3. CLOSING AND
DELIVERIES
SECTION
3.1 Closing.
The consummation of the transactions contemplated hereby (the “Closing”) shall take place on
the first Business Day following the satisfaction or waiver by the appropriate
party of all the conditions contained in Article 7 or on such other date or at
such other place and time as may be mutually agreed to by the parties (the “Closing Date”). All
proceedings to be taken and all documents to be executed and delivered by the
parties at the Closing shall be deemed to have been taken and executed
simultaneously and no proceedings shall be deemed to have been taken nor
documents executed or delivered until all have been taken, executed and
delivered.
SECTION
3.2 Seller’s
Deliveries. At the Closing, Seller shall deliver the following to
Buyer:
(a) The
sale, transfer, assignment, conveyance and delivery of good and marketable title
to the Acquired Assets, including but not limited to good and marketable
leasehold interests with respect to the Acquired Contracts, by bills of sale,
deeds, endorsements, assignments and other instruments of transfer and
conveyance in form and substance reasonably acceptable to Buyer;
(b) A
certified copy of the Bankruptcy Sale Order. For purposes of clarity, the
Bankruptcy Sale Order shall contain the provisions, findings and orders
reasonably acceptable to the parties, including, but not limited to, the
following:
(i) that
the terms and conditions of the sale of the Acquired Assets to Buyer as set
forth herein are approved;
(ii) that
Seller holds good and marketable title to the Acquired Assets;
(iii)
that the sale of the Acquired Assets to Buyer is free and clear, other than for
Assumed Liabilities, of any and all Liens, Claims, interests, and encumbrances
of any type or nature whatsoever pursuant to section 363 of the Bankruptcy Code
and to the extent applicable that any such Liens attach to the proceeds of the
sale;
(iv) that
the Total Consideration constitutes fair value for the Acquired
Assets;
(v) that
Buyer is acquiring none of the Excluded Assets;
(vi) that
the transactions contemplated by this Agreement were negotiated at arm’s length,
that the Buyer acted in good faith in all respects and that Buyer and its
assignees and designees are entitled to the protections of Section 363(m) of the
Bankruptcy Code;
(vii)
that notice of the transactions contemplated hereby was adequate and proper
under the circumstances and was provided to all creditors and parties in
interest required to receive such notice pursuant to the Bankruptcy Rules or
order of the Bankruptcy Court, including any and all creditors holding Liens or
encumbrances on the Acquired Assets or any of them;
(viii)
that the Seller is authorized to assume and assign to Buyer each of the Acquired
Contracts set forth on Schedule 1.1(d); provided, that Seller
shall have sole responsibility of paying the cure costs required to be paid in
accordance with section 365(b)(1)(A) of the Bankruptcy Code and Section 7.2(i)
of this Agreement;
(ix) that
the Seller is authorized and directed to consummate the transactions
contemplated by this Agreement and to comply in all respects with the terms of
this Agreement;
(x) that
the sale process conducted by Seller and/or its agents was non-collusive, fair
and reasonable and was conducted in good faith;
(xi) that
Buyer and Seller did not engage in any conduct which would allow the
transactions contemplated by this Agreement to be set aside pursuant to Section
363(n) of the Bankruptcy Code;
(xii)
that Buyer is not a successor to, or otherwise liable for, the debts or
obligations of the Seller, including without limitation, any Claims for injuries
or losses suffered to any persons or property for incidences or circumstances
that occurred before the Closing, other than as specifically set forth in this
Agreement with respect to the Assumed Liabilities;
(xiii)
that Buyer shall not be deemed a successor employer to the Seller for purposes
of any liability arising under the Warn Act or NY Warn Act, or any collective
bargaining agreement or other labor or employment agreement; and
(xiv)
that the Order is binding upon any successors to the Seller, including any
Chapter 7 Trustees;
(c) A
certificate, dated as of the Closing Date, duly executed by the Seller’s
President, certifying the accuracy of the matters set forth in Section 7.2(a)
and 7.2(b), in form and substance reasonably satisfactory to Buyer;
(d) Good
standing certificates of Seller issued by the Secretary of State of Delaware and
the Secretary of State of New York issued within ten (10) days of the Closing
Date;
(e) A
settlement statement in form and substance satisfactory to the parties hereto,
regarding certain Closing matters;
(f) with
respect to any recorded UCC financing statement or mortgage, a UCC-3 termination
statement or mortgage release (in form and substance reasonably satisfactory to
Seller, Buyer and their counsel) releasing the Acquired Assets from such
security interest or mortgage; and
(g) Such
other bills of sale, certificates of title, documents and other instruments of
transfer and such other instruments of conveyance as Buyer may reasonably
request in order to effect the sale, transfer, conveyance and assignment to
Buyer of valid ownership of the Acquired Assets and such other documents as
Seller may reasonably be requested by Buyer, which shall include certain powers
of attorney for temporary use of Seller’s licenses with respect to the Pharmacy,
each in form and substance reasonably satisfactory to Buyer.
SECTION
3.3 Buyer’s
Deliveries.
At the
Closing, Buyer shall deliver the following to Seller:
(a)
Payment of the Purchase Price, less the Buyer’s Deposit, by federal funds wire
transfer;
(b) An
instrument of assignment and assumption of liabilities with respect to the
Assumed Liabilities, reasonably satisfactory in form and substance to counsel
for Seller and Buyer and power of attorney form with respect to Seller’s
licenses and/or permits enabling the Buyer to temporarily operate the Pharmacy
after the Closing until Buyer has obtained its own licenses and
permits;
(c) A
certificate, dated the Closing Date, duly executed by its President, certifying
the accuracy of the matters set forth in Section 7.1(a) and Section 7.1(b);
and
(d) A
settlement statement in form and substance satisfactory to the parties hereto,
regarding certain Closing matters, including any adjustments to the Purchase
Price. Executed by Buyer.
ARTICLE
4. REPRESENTATIONS
AND WARRANTIES
SECTION
4.1 Representations
and Warranties of Seller. Seller hereby represents and warrants to Buyer,
as of the date hereof and as of the Closing Date, as follows:
(a) Corporate
Organization. Seller is duly organized, validly existing and in good
standing under the laws of the State of Delaware. Seller has all
requisite corporate power and authority to own its properties and assets and to
conduct its businesses as now conducted.
(b) Authorization and
Validity. Seller has all requisite corporate power and authority to enter
into this Agreement and, subject to the (i) Bankruptcy Court’s entry
of the Order, and (ii) receipt of all Consents, to perform its obligations
hereunder, the execution and delivery of this Agreement and the performance
of Seller’s obligations hereunder, has been, or on the Closing Date
will be, duly authorized by all necessary corporate action of Seller, and no
other corporate proceedings on the part of Seller are necessary to authorize
such execution, delivery and performance. This Agreement has been duly executed
by Seller, and, subject to the Bankruptcy Court’s entry of the Order,
constitutes valid and binding obligations, enforceable against Seller in
accordance with its terms. The Board of Directors of Seller has resolved to
request that the Bankruptcy Court approve this Agreement and the transactions
contemplated hereby.
(c) No Conflict or
Violation. Subject to the (i) receipt of all Consents and (ii)
the Bankruptcy Court’s entry of the Orders, the execution, delivery and
performance by Seller of this Agreement does not and will not (a) violate or
conflict with any provision of the Certificate of Incorporation or By-laws of
Seller, (b) violate any provision of law, or any order, judgment or decree of
any Government applicable to Seller, (c) result in or require the creation or
imposition of any Liens on any of the Acquired Assets; or (d) violate or result
in a breach of or constitute (with due notice or lapse of time or both) a
default under any Contract entered into by Seller after the Petition Date, by
which Seller is bound or to which the assets of Seller are subject.
(d) Consents and
Approvals. Schedule 4.1(d) sets forth a true and complete list of each
consent, waiver, authorization or approval of any Person and each material
declaration to or filing or registration with any Government that is required to
be obtained by any Seller in connection with the execution and delivery by it of
this Agreement or the performance by it of its obligations hereunder or
thereunder, including, without limitation, any and all material consents and
approvals that are required to be obtained, or rights of first refusal, first
offer or other similar preferential rights to purchase that are required to be
complied with, in connection with the assignment or transfer of any Acquired
Assets to Buyer in accordance with the terms of this Agreement (collectively,
the “Consents”).
(e) Compliance with Laws.
With respect to the Supermarkets, Seller is in compliance with all applicable
laws, regulations, orders or other legal requirements to which Seller is
subject. Seller has not received written notice of any violation of
any law, regulation, order or other legal requirement and Seller is in default
with respect to any order, writ, judgment, award, injunction or decree of any
Government. Seller has complied with the requirements of the WARN Act and the
NYS Warn Act and specifically provided the mandated notifications to the
appropriate governmental agencies or departments on November 18,
2009.
(f) Title to Acquired
Assets. Subject to the entry of the Bankruptcy Sale Order, at the
Closing, Seller has or will obtain good and marketable title to (or has procured
one or more title insurance policies, at Seller’s expense, acceptable to Buyer
providing coverage for any defects in the marketability of the Seller’s title to
any real estate or leasehold interests therein) or a valid and enforceable right
by Contract to use the Acquired Assets which shall be transferred to Buyer free
and clear of all Liens. Except for the Excluded Assets, the Acquired Assets
constitute all of the fixed assets presently used in, and necessary for the
conduct of, the operations of the Supermarkets as currently
conducted.
(g) Legal Proceedings.
Other than the Bankruptcy Case, there is no action, litigation, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any
court, public board or body, pending or, to the best of Seller's knowledge,
threatened against or affecting Seller or the Acquired Assets, nor is there any
basis therefor, wherein an unfavorable decision, ruling or finding would
adversely affect the validity or enforceability of this Agreement or the
consummation of the transactions contemplated hereby.
(h) Supermarkets.
Relating solely to the operation of the Supermarkets, Seller is not a party to
any written or oral:
(i)
contract for the future purchase of fixed assets (other than this
Agreement);
(ii)
contracts for the future purchase of materials, supplies or equipment other than
in the ordinary course of business;
(iii)
agreement or other commitment for capital expenditures in excess of normal
operating requirements;
(iv)
contract, agreement, or commitment under which Seller is required to supply
goods or products to any customer or other person other than in the ordinary
course of business; or
(v) any
other contract, agreement, arrangement or understanding which is material to the
business and operation of the Supermarkets, including without limitation
abridging or modifying any of its leasehold interests with respect to the
Acquired Assets.
(i) Environmental. To the
Knowledge of Seller, no action, hearing, investigation, complaint, or notice has
been filed against Seller with respect to the Supermarkets alleging any failure
to comply with any applicable United States environmental, health, and safety
law, including but not limited to any applicable regulation promulgated by the
Environmental Protection Agency of the United States of America and any
applicable comparable New York statute or regulation. In addition, none of the
Acquired Assets includes any underground or above ground storage tanks or if any
such storage tanks exist that they are in compliance with applicable
environmental statutes, rules and regulations.
SECTION
4.2 Representations and
Warranties of Buyer. Buyer hereby represents and warrants to Seller as
follows:
(a) Corporate
Organization. Buyer is a corporation duly organized, validly existing and
in good standing under the laws of the State of New York and has all requisite
corporate power and authority to own its properties and assets and to conduct
its businesses as now conducted.
(b) Authorization and
Validity. Buyer has all requisite corporate power and authority to enter
into this Agreement and has or will have all requisite corporate power and
authority to perform its obligations hereunder. The execution and delivery of
this Agreement and the performance of Buyer’s obligations hereunder have been,
or on the Closing Date will be, duly authorized by all necessary corporate
action by the Board of Directors of Buyer, and no other corporate proceedings on
the part of Buyer are necessary to authorize such execution, delivery and
performance. This Agreement has been duly executed by Buyer and constitutes
valid and binding obligations, enforceable against Buyer in accordance with its
terms.
(c) No Conflict or
Violation. The execution, delivery and performance by Buyer of this
Agreement to which Buyer is or will become a party do not and will not (i)
violate or conflict with any provision of the Certificate of Incorporation or
Bylaws of Buyer, (ii) violate any provision of law, or any order, judgment or
decree of any court or Government applicable to Buyer; or (iii) violate or
result in a breach of or constitute (with due notice or lapse of time or both) a
default under any Contract to which Buyer is party or by which Buyer is bound or
to which any of Buyer’s properties or assets is subject.
(d) Adequate Assurances
Regarding Acquired Contracts. Buyer is capable of satisfying the
conditions and obligations contained in sections 365(b)(1)(C) and 365(f)(2)(B)
of the Bankruptcy Code with respect to the Acquired Contracts as may be required
pursuant to the Bankruptcy Code.
(e) Litigation. There are
no claims, actions, suits, proceedings or investigations pending or, to the
Knowledge of Buyer, threatened, before any federal or state court, Government or
Person brought by or against Buyer, or any Related Person of Buyer that could
reasonably be expected to affect the ability of Buyer to consummate the
transactions contemplated by this Agreement.
(f) Adequacy of
Funds. Buyer has and on the Closing Date will have access to
sufficient resources to fund the Total Consideration and has provided Seller
proof thereof prior to the date of this Agreement.
(g) HIPPA. Buyer is a “hybrid
covered entity” as such term is defined in the Health Insurance Portability and
Accountability Act of 1996 (“HIPAA”), and is in full
compliance with all of its obligations under HIPAA and the regulations issued
thereunder (the “HIPAA
Regulations”).
SECTION
4.3 Warranties Are
Exclusive. The parties acknowledge that the representations and
warranties contained in this Article 4 are the only representations or
warranties given by the parties and that all other express or implied warranties
are disclaimed. Without limiting the foregoing, Buyer acknowledges that the
Acquired Assets are conveyed “AS IS”, “WHERE IS” and ‘”WITH ALL FAULTS” and that
all warranties of merchantability or fitness for a particular purpose are
disclaimed. WITHOUT LIMITING THE FOREGOING, AND AS EXPRESSLY SET
FORTH IN ARTICLE 4, BUYER ACKNOWLEDGES THAT SELLER AND THEIR RELATED PERSONS AND
AFFILIATES HAVE MADE NO REPRESENTATION OR WARRANTY CONCERNING ANY (A) USE TO
WHICH THE ACQUIRED ASSETS MAY BE PUT; (B) FUTURE REVENUES, COSTS, EXPENDITURES,
CASH FLOW, RESULTS OF OPERATIONS, FINANCIAL CONDITION OR PROSPECTS THAT MAY
RESULT FROM THE OWNERSHIP, USE OR SALE OF THE ACQUIRED ASSETS OR THE ASSUMPTION
OF THE ASSUMED LIABILITIES; OR (C) OTHER INFORMATION OR DOCUMENTS MADE AVAILABLE
TO BUYER OR ITS AFFILIATES OR RELATED PERSONS.
ARTICLE
5. COVENANTS AND
OTHER AGREEMENTS
SECTION
5.1 Pre-Closing
Covenants of Seller. Seller covenants to Buyer that during the
period from the Execution Date through and including the Closing
Date:
(a) Conduct of Business Before
the Closing Date. Unless otherwise agreed in writing by Seller and Buyer,
Seller shall operate the Supermarkets in all material respects in the Ordinary
Course of Business. Without limiting the foregoing and without obtaining the
prior consent of Buyer to take any actions not permitted or required by the
following clauses, Seller:
(i) shall
not take or agree to commit to take any action that would make any
representation or warranty of Seller inaccurate in any material respect at, or
as of any time prior to, the Closing Date;
(ii)
shall keep in full force and effect and pay all premiums and other amounts due
under the insurance policies;
(iii)
shall not sell or dispose of any Acquired Assets other than sales of Pharmacy
Inventory in the Ordinary Course of Business;
(iv)
shall not make any material modification to any Acquired Contract;
and
(v) shall
provide notification to the New York State Department of Taxation and Finance,
the United States Department of Drug Enforcement Administration and any other
regulatory agencies or departments that may be required to have notification of
the transaction contemplated in this Agreement.
(b) Cooperation. Seller
shall use commercially reasonable efforts to (i) obtain the Consents and (ii)
take, or cause to be taken, all action and to do, or cause to be done, all
things necessary or proper, consistent with applicable law, to consummate and
make effective as soon as possible the transactions contemplated
hereby.
(c) Access to Records and
Properties. Buyer shall be entitled to, at its expense, conduct such
investigation of the condition of the Acquired Assets as Buyer shall reasonably
deem appropriate.
(d) Notice of Certain
Events. Seller shall promptly notify Buyer of, and furnish to Buyer, any
information it may reasonably request with respect to the occurrence of any
event or condition or the existence of any fact that would reasonably be
expected to cause any of the conditions to Buyer’s obligations to consummate the
transactions contemplated by this Agreement not to be fulfilled.
SECTION
5.2 Pre-Closing Covenants of
Buyer. Buyer covenants to Seller that, during the period from the
Execution Date through and including the Closing Date or the earlier termination
of this Agreement:
(a) Cooperation. Buyer
shall use commercially reasonable efforts to take, or cause to be taken, all
action and to do, or cause to be done, all things necessary or proper,
consistent with applicable law, to consummate and make effective as soon as
possible the transactions contemplated hereby.
(b) Adequate Assurances
Regarding Acquired Contracts and Required Orders. With respect to each
Acquired Contract, Buyer shall provide adequate assurance of the future
performance of such Acquired Contract by Buyer within the meaning of the
Bankruptcy Code. Buyer shall promptly take such actions as may be reasonably
requested by Seller to assist Seller in obtaining the Bankruptcy Court’s entry
of the Orders and any other order of the Bankruptcy Court reasonably necessary
to consummate the transactions contemplated by this Agreement.
(c) Notice of Certain
Events. Buyer shall promptly notify Seller of, and furnish to Seller, any
information it may reasonably request with respect to the occurrence of any
event or condition or the existence of any fact that would reasonably be
expected to cause any of the conditions to Seller’ obligations to consummate the
transactions contemplated by this Agreement not to be fulfilled.
SECTION
5.3 Employment Matters.
Buyer shall have the right, but shall have no obligation, to offer employment
post-Closing to employees of Seller. Any meeting between any such Person and
Buyer pursuant to this subsection shall occur at a time and place that does not
conflict with such Person’s employment obligations to Seller. Any employment
offered by Buyer to such Person shall be on such terms and conditions as Buyer,
in its sole discretion, may determine.
SECTION
5.4 Post-Closing Covenants of
Buyer.
(a) Buyer
shall comply in all respects with HIPAA and the HIPAA Regulations, including
without limitation the privacy and security obligations thereunder, with respect
to the Pharmacy Records.
(b) For a
period of thirty (30) days after the Closing Date, upon reasonable advance
notice and during reasonable hours, Buyer will permit Seller’s employees, agents
and Person’s otherwise acting within the scope of Seller’s authority to have
reasonable access to the Supermarkets for the purpose of removing or selling
Excluded Assets that have not been removed prior to the Closing.
ARTICLE
6. TAXES
SECTION
6.1 Taxes Related to
Purchase of Acquired Assets. All Taxes, including, without limitation,
all state and local Taxes in connection with the transfer of the Acquired
Assets, and all recording and filing fees (collectively, “Transaction Taxes”) that may
be imposed by reason of the sale, transfer, assignment and delivery of the
Acquired Assets shall be borne fifty percent (50%) by Buyer and fifty percent
(50%) by Seller. Buyer and Seller shall cooperate to (a) determine
the amount of Transaction Taxes payable in connection with the transactions
contemplated under this Agreement, (b) provide all requisite exemption
certificates and (c) prepare and file any and all required Tax Returns for or
with respect to such Transaction Taxes with any and all appropriate Government
taxing authorities.
SECTION
6.2 Cooperation on Tax
Matters.
(a) After
the Closing, Buyer shall retain possession of all accounting, business,
financial and Tax records and information (i) relating to the Acquired Assets or
the Assumed Liabilities that are in existence on the Closing Date and
transferred to Buyer hereunder; and (ii) coming into existence after the Closing
Date that relate to the Acquired Assets or the Assumed Liabilities before the
Closing Date, for the minimal period from the Closing Date as required by the
Code. Buyer shall give Seller notice and an opportunity to retain any such
records in the event that Buyer determines to destroy or dispose of them after
such period. In addition, from and after the Closing Date, Buyer shall provide
access to Seller and its Related Persons (after reasonable notice and during
normal business hours and without charge), to the books, records, documents and
other information relating to the Acquired Assets or the Assumed Liabilities as
Seller may reasonably deem necessary to (i) properly prepare for, file, prove,
answer, prosecute and defend any such Tax Return, claim, filing, tax audit, tax
protest, suit, proceeding or answer; or (ii) administer or complete any case of
Seller under chapter 11 of the Bankruptcy Code. Such access shall include,
without limitation, access to any computerized information retrieval systems
relating to the Acquired Assets or the Assumed Liabilities.
(b) Buyer
and Seller will allocate the Total Consideration among the Acquired Assets in
accordance with a schedule to be reasonably agreed by them (the “Allocation”). The Allocation
will be binding upon Buyer and Seller and their respective successors and
assigns, and the parties to this Agreement shall not take any position (whether
in returns, audits or otherwise) that is inconsistent with the
Allocation.
ARTICLE
7. CONDITIONS
PRECEDENT TO PERFORMANCE BY PARTIES
SECTION
7.1 Conditions Precedent to
Performance by Seller. The obligation of Seller to consummate the
transactions contemplated by this Agreement is subject to the fulfillment, at or
before the Closing, of the following conditions, any one or more of which may be
waived by Seller, in its sole discretion:
(a) Representations and
Warranties of Buyer. The representations and warranties of Buyer made in
Section 4.2 of this Agreement, in each case, shall be true and correct in all
material respects as of the Execution Date and as of the Closing Date as though
made by Buyer again as of the Closing Date, except to the extent that such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties shall be true and correct on and as of
such earlier date.
(b) Performance of the
Obligations of Buyer. Buyer shall have performed in all material respects
all obligations required under this Agreement which are to be performed by it on
or before the Closing Date (except with respect to the obligation to pay the
Total Consideration in accordance with the terms of this Agreement and any
obligations qualified by materiality, which obligations shall be performed in
all respects as required under this Agreement).
(c) Governmental Consents and
Approvals. The Orders shall have been entered and shall not be subject to
a stay, injunction or any governmental investigation or proceedings which may
contest the transaction contemplated by this Agreement.
(d) No Violation of
Orders. No preliminary or permanent injunction or other order of any
court or Government that declares this Agreement invalid or unenforceable in any
material respect or which prevents the consummation of the transactions
contemplated hereby shall be in effect.
(e) No Litigation. There
shall not be pending or threatened in writing by any Government any suit, action
or proceeding (i) challenging or seeking to restrain, prohibit, alter or
materially delay the consummation of any of the transactions contemplated by
this Agreement or (ii) seeking to obtain from any Seller any damages in
connection with the transactions contemplated hereby.
(f) Closing Deliveries.
Buyer shall have made the deliveries contemplated under Section
3.3.
SECTION
7.2 Conditions Precedent to the
Performance by Buyer. The obligation of Buyer to consummate
the transactions contemplated by this Agreement is subject to the fulfillment,
at or before the Closing, of the following conditions, any one or more of which
may be waived by Buyer, in its sole discretion:
(a) Representations and
Warranties of Seller. The representations and warranties of Seller made
in Section 4.1 of this Agreement shall be true and correct in all material
respects as of the Execution Date and as of the Closing Date as though made by
Seller again as of the Closing Date, except to the extent that such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties shall be true and correct on and as of
such earlier date.
(b) Performance of the
Obligations of Seller. Seller shall have performed in all material
respects all obligations required under this Agreement to which Seller is party
to be performed by Seller on or before the Closing Date (except with respect to
any obligations qualified by materiality, which obligations shall be performed
in all respects as required under this Agreement).
(c) Governmental Consents and
Approvals. The Orders shall have been entered and shall not be subject to
a stay or injunction or other governmental investigation or proceeding that may
contest the transaction contemplated by this Agreement.
(d) No Violation of
Orders. No preliminary or permanent injunction or other order of any
court or Government that declares this Agreement invalid in any material respect
or prevents the consummation of the transactions contemplated hereby shall be in
effect.
(e) No Litigation. There
shall not be pending or threatened in writing by any Government any suit, action
or proceeding, (i) challenging or seeking to restrain, prohibit, alter or
materially delay the consummation of any of the transactions contemplated by
this Agreement, (ii) seeking to obtain from Buyer or any of its Affiliates any
damages in connection with the transactions contemplated hereby or (iii) seeking
to prohibit Buyer or any of its Affiliates from effectively controlling or
operating any portion of the Acquired Assets.
(f) Closing Deliveries.
Seller shall have made the deliveries contemplated under Section
3.2.
(g) Condition of Acquired
Assets. Other than reasonable wear and tear with respect to Owned
Machinery and Equipment, the Acquired Assets have not become subject to damage
or other casualty causing a damage to Acquired Assets of an aggregate value
exceeding $500,000.
(h) Store Identification.
Each lessor in respect to the Acquired Contracts (i) consents to the Buyer’s
re-branding and identification of the respective Supermarkets, including the
installation and construction of signage or other alterations to the premises as
required by the Buyer (ii) and waives any restrictions or events of default that
may arise under the terms of any of the real estate leases which arise by reason
of the Buyer temporarily closing the respective Supermarkets for the purposes of
remodeling, altering or renovating the subject premises.
(i) Acquired Contract
Cure. Seller shall, consistent with section 365(b)(1)(A) of the
Bankruptcy Code, either pay undisputed cure claims relating to Acquired
Contracts on the Closing Date or provide for a reservation of funds sufficient
to pay the alleged amount of any disputed cure claim relating to an Acquired
Contract on the Closing Date.
(j) Environmental
Investigation. Buyer may perform an investigation of environmental
matters at the Supermarkets, including but not limited to any Phase I studies,
which investigation must be concluded by noon (Eastern) December 21, 2009, and
Buyer being satisfied in its sole and absolute discretion of the condition of
the subject leased premises in respect thereof.
(k) Material Adverse
Changes. That no material event or threatened event shall have
occurred prior to the Closing Date which was not contemplated by either the
Buyer or Seller which would adversely impair or affect the normal business
operations of the Debtor at the Supermarkets, including without limitation; the
condition of the Acquired Assets, the anticipated financial results of the
Supermarkets or title to the Acquired Assets.
ARTICLE
8. TERMINATION
SECTION
8.1 Conditions of
Termination. This Agreement may be terminated only in accordance with
this Section 8.1. This Agreement may be terminated at any time before the
Closing as follows:
(a) By
mutual written consent of Seller and Buyer;
(b) By
Seller, by written notice to Buyer, or by Buyer, by written notice to Seller, on
or after the date that is thirty (30) days after the entry of the Bankruptcy
Sale Order and (i) from which no appeal has been filed, or (ii) if appealed, no
stay has been issued and the Buyer is decreed to be a good faith purchaser
pursuant to Bankruptcy Code section 365(m) (the “Termination Date”), subject,
however, to extension by the mutual written consent of Seller and Buyer, if the
Closing shall not have occurred on or prior to the Termination Date; provided, however that a party
shall not have the right to terminate this Agreement under this Section 8.1(b)
if Seller (in case of termination by Seller) or Buyer (in case of termination by
Buyer) is then in material breach of this Agreement or has been responsible for
materially delaying the Closing;
(c) By
Seller, by written notice to Buyer, or by Buyer, by written notice to Seller, if
any injunction (including an injunction issued by the Bankruptcy Court or
District Court based upon an appeal from the Bankruptcy Sale Order), other
order, or proceedings/investigations instituted by any governmental agencies or
departments that would delay, impair or otherwise hinder the Closing of the
transactions contemplated by this agreement, restricting the transactions
contemplated by this Agreement shall have become effective; provided, however that the
party seeking to terminate this Agreement pursuant to this Section 8.1(c) has
used its commercially reasonable efforts to remove such injunction or other
order;
(d) By
Seller, by written notice to Buyer, if Seller has previously provided Buyer with
written notice of any inaccuracy of any representation or warranty contained in
Section 4.2 which inaccuracy could reasonably be expected to result in a
material failure to perform any covenant of Buyer contained in this Agreement,
and Buyer has failed, within five Business Days after receipt of such notice, to
remedy such inaccuracy or perform such covenant or provide reasonably adequate
assurance to Seller of Buyer’s ability to remedy such inaccuracy or perform such
covenant; provided, that Seller
shall not have the right to terminate this Agreement under this Section 8.1(d)
if Seller is in material breach of this Agreement at the xxxx Xxxxxx gives such
notice;
(e) By
Buyer, by written notice to Seller, if Buyer has previously provided Seller with
written notice of any inaccuracy of any representation or warranty of Seller
contained in Section 4.1 which inaccuracy could reasonably be expected to result
in, individually or in the aggregate with the results of other inaccuracies, a
material failure to perform any covenant of Seller contained in this Agreement,
and Seller has failed, within five Business Days after receipt of such notice,
to remedy such inaccuracy or perform such covenant or provide reasonably
adequate assurance to Buyer of Seller’s ability to remedy such inaccuracy or
perform such covenant; provided, that Buyer
shall not have the right to terminate this Agreement under this Section 8.1(e)
if Buyer is in material breach of this Agreement at the time it gives such
notice;
(f) By
Buyer, by written notice to Seller, if (i) the Sale Motion is not filed with the
Bankruptcy Court within five Business Days after the Execution Date, or (iii)
the Bankruptcy Sale Order in form and substance acceptable to Buyer is not
entered by the Bankruptcy Court within 65 days of the Execution
Date;
(g) By
Buyer, by written notice to Seller delivered within Five Business Days after
Seller has provided written notice to Buyer of the suffering of damage to the
Acquired Assets which in the aggregate is in excess of $500,000.00 occurs prior
to the Closing Date; provided, that if
damage or casualty to Acquired Assets exceeding $500,000 in the aggregate
occurs, Buyer shall have the option in lieu of terminating this Agreement, which
option shall be exercisable by Buyer in its sole discretion in writing delivered
to Seller not less than one Business Day prior to the Closing, to reduce Total
Consideration otherwise payable by Buyer by the amount that such damage or
casualty consistent with Section 2.1 above.
(h) By
Buyer, in the event that it is a party to a joint bid for the acquisition of the
Debtor’s assets, which includes the Supermarkets, which joint bid is accepted by
the Debtor and approved by the Bankruptcy Court (“Buyer’s Alternate Joint
Bid”).
SECTION
8.2 Effect
of Termination; Remedies.
(a) If
this Agreement is terminated pursuant to any of Section 8.1(a), Section 8.1(b),
Section 8.1(c), Section 8.1(e), Section 8.1(f), Section 8.1(g) and Section
8.1(h), then, within two Business Days after such termination, Seller shall
return the Buyer’s Deposit to Buyer.
(b) If
this Agreement is terminated pursuant to Section 8.1(d), or otherwise due to
Buyer’s breach of this Agreement, then, in addition to any other remedies
available to Seller, Seller shall retain the Buyer’s Deposit; and any court
order approving this Agreement shall so provide.
SECTION
8.3 Remedies. Each party
acknowledges that in case of any breach of their covenants or other obligations,
the other may suffer immediate and irreparable harm. Accordingly, in case of any
such breach, the non-breaching party shall be entitled to obtain damages or
other remedies provided in this Agreement and/or such other relief in law or
equity as may be granted by the Bankruptcy Court or other court of competent
jurisdiction.
ARTICLE
9. SURVIVAL AND
INDEMNIFICATION
SECTION
9.1 Non-survival of
Seller’s Representations, Warranties and Covenants. None of the
representations, warranties and covenants made by Seller in this Agreement will
survive the Closing, except that to the extent Seller maintains general
liability insurance policies, the Seller shall use its best efforts to have the
Buyer named as an additional insured party regarding coverage of the Acquired
Assets from the period of time beginning on the Execution Date and ending on the
Closing Date.
SECTION
9.2 Survival;
Indemnification.
(a) The
representations and warranties of Buyer contained in this Agreement shall
survive the Closing until the date that is six (6) months after the Closing Date
(the “Survival Period”).
Seller shall not have any claim or right of recovery for any Breach of a
representation or warranty unless (x) written notice is given by Seller to Buyer
of the representation or warranty pursuant to which the claim is made or right
of recovery is sought setting forth in reasonable detail the basis for the
purported Breach of the representation or warranty, the amount or nature of the
claim being made, if then ascertainable, and the general basis therefor and (y)
such notice is given prior to the expiration of the Survival
Period.
(b) Buyer
hereby agrees to indemnify and hold Seller and its officers, directors,
shareholders, employees, affiliates, attorneys, accountants and agents
(collectively, the “Seller
Parties”) harmless from, against and in respect of:
(i) any
and all loss suffered or incurred by any of the Seller Parties by reason of any
untrue representation, breach of warranty or non-fulfillment of any covenant by
Buyer contained herein or in any schedule, exhibit, certificate, document or
instrument delivered to Seller pursuant hereto or in connection
herewith;
(ii) any
and all loss suffered or incurred by any of the Seller Parties in respect of, in
connection with or arising out of any Assumed Liabilities from and after the
Closing Date;
(iii) any
and all losses suffered or incurred by any of the Seller Parties arising from
Buyer’s use or operation of the Supermarkets or the Acquired Assets from and
after the Closing Date;
(iv) any
and all actions, suits, proceedings, claims, demands, assessments, judgments,
costs and expenses, including legal fees and expenses, incident to any of the
foregoing or incurred in investigating or attempting to avoid the same or to
oppose the imposition thereof, or in enforcing this indemnity; and
(v) any
claim by any Person for brokerage or finder’s fees or commissions or similar
payments based upon any agreement or understanding alleged to have been made by
such Person with Buyer (or any Person acting on Buyer’s behalf) in connection
with any of the transactions contemplated by this Agreement.
ARTICLE
10. MISCELLANEOUS
SECTION
10.1 Sale
Hearing and Entry of Bankruptcy Sale Order. The Seller shall file with
the Bankruptcy Court a motion seeking the approval of the sale and transactions
contemplated by this Agreement (the “Sale Motion”). The Sale Motion shall seek
entry by the Bankruptcy Court of the Bankruptcy Sale Order on or before January
8, 2010.
SECTION
10.2 Alternative
Transaction. The Purchase Price and the transaction contemplated by this
Agreement is predicated upon the entire transaction not being subject to any
competing bids or solicitation of any bids from other prospective
purchasers. Accordingly, neither the Seller or any other party in
interest (including the Creditor’s Committee) shall solicit any competing
bids. However, in the performance of their fiduciary duties, Seller
may disseminate information to any other prospective purchasers with respect to
the assets and property interests that are the subject of this Agreement but
only based on their written request for such information.
SECTION
10.3 Further
Assurances. At the request and the sole expense of the requesting party,
Buyer or Seller, as applicable, shall execute and deliver, or cause to be
executed and delivered, such documents as Buyer or Seller, as applicable, or
their respective counsel may reasonably request to effectuate the purposes of
this Agreement.
SECTION
10.4 Successors and
Assigns. Buyer shall have the right to assign to any Affiliate or
Affiliates (each, an “Assignee”) any of its rights
or obligations (including the right to acquire any of the Acquired Assets) and
may require any such Assignee to pay all or a portion of the Purchase Price
and/or to assume all or a portion of those Assumed Liabilities that are both
described in Section 1.3 and relate to the Acquired Assets acquired by the
Assignee (“Assignable
Liabilities”). In the event of any assignment pursuant to this Section
10.4, Buyer shall not be relieved of any liability or obligation
hereunder.
SECTION
10.5 Governing Law:
Jurisdiction. This Agreement shall be construed, performed and
enforced in accordance with, and governed by, the laws of the State of New York
(without giving effect to the principles of conflicts of laws thereof), except
to the extent that the laws of such State are superseded by the Bankruptcy Code
or other applicable federal law. For so long as Seller is subject to the
jurisdiction of the Bankruptcy Court, the parties irrevocably elect, as the sole
judicial forum for the adjudication of any matters arising under or in
connection with the Agreement, and consent to the exclusive jurisdiction of, the
Bankruptcy Court. In particular, the Bankruptcy Court shall retain
original and exclusive jurisdiction over, among other matters, any and all
disputes relating to Buyer's claims for indemnification under Section
9.1.
SECTION
10.6 Expenses.
Except as otherwise provided in this Agreement, each of the parties shall pay
its own expenses in connection with this Agreement and the transactions
contemplated hereby, including, without limitation, any legal and accounting
fees, whether or not the transactions contemplated hereby are
consummated.
SECTION
10.7 Broker’s and
Finder’s Fees. Each of the parties represents and warrants that it has
not engaged any broker or finder in connection with any of the transactions
contemplated by this Agreement.
SECTION
10.8 Severability. In the
event that any part of this Agreement is declared by any court or other judicial
or administrative body to be null, void or unenforceable, said provision shall
survive to the extent it is not so declared, and all of the other provisions of
this Agreement shall remain in full force and effect only if, after excluding
the portion deemed to be unenforceable, the remaining terms shall provide for
the consummation of the transactions contemplated hereby in substantially the
same manner as originally set forth at the later of (a) the Execution Date and
(b) the date this Agreement was last amended.
SECTION
10.9 Notices.
All notices, requests, demands, consents and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given: (i)
on the date of service, if served personally on the party to whom notice is to
be given; (ii) on the day of transmission, if sent via facsimile transmission to
the facsimile number given below: (iii) on the day after delivery to Federal
Express or similar overnight courier or the Express Mail service maintained by
the United States Postal Service addressed to the party to whom notice is to be
given; or (iv) on the fifth day after mailing, if mailed to the party to whom
notice is to be given, by first class mail, registered or certified, postage
prepaid and properly addressed, to the party as follows:
If to
Buyer: Price Chopper
Supermarkets 000
Xxxxxxxxxx
Xxxx Xxxxxxxxxxx,
XX 00000 Attn: Vice President Real
Estate/Construction
Telecopy No.: (000) 000-0000
With a
copy to: Price Chopper
Supermarkets 000
Xxxxxxxxxx
Xxxx Xxxxxxxxxxx, XX 00000 Attn: Legal
Department
With a
copy to: Xxxxxx Xxxxxxx &
Xxxxx XXX, Xxxxxxxxx and Counselors Twelve
Xxxxxxxx
Xxxxx, Xxxxx 000 Xxxxxxx, XX 00000-0000 Attn: Xxxxxxx X. Xxxx
Telecopy
No.:
716.853.1617
If to
Seller: The Penn Traffic
Company
X.X. Xxx
0000 Xxxxxxxx, XX 00000 Attention:
Xxxxxx
Xxxxxxx
Telecopy No.: (000) 000-0000
With a
copy to: The Penn Traffic
Company
P. O. Xxx
0000 Xxxxxxxx, XX 00000 Attention: Xxxxxx
Xxxxxxx,
General
Counsel Telecopy No.: (000) 000-0000
Any party
may change its address or facsimile number for the purpose of this Section 10.9
by giving the other parties written notice of its new address in the manner set
forth above.
SECTION
10.10 Counterpart
Execution. This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which shall constitute but one and the
same instrument. Delivery by facsimile or in a PDF transmission of a counterpart
of this Agreement as executed by the party making the delivery shall constitute
good and valid execution and delivery of this Agreement for all
purposes.
(Signature
Page Follows)
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BUYER:
PRICE CHOPPER OPERATING CO., INC.
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" -
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By:
Name: Xxxx X. Xxxxx Title: Chairman of the Board, President &
CEO
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SELLER:
THE PENN TRAFFIC COMPANY
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By:
Name: Xxxxxx X. Xxxxxxx Title: Senior Vice President and General
Counsel
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BUYER:
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PRICE
CHOPPER OPERATING CO., INC.
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By:
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Name:
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Xxxx
X. Xxxxx
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Title:
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Chairman
of the Board, President & CEO
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SELLER:
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THE
PENN TRAFFIC COMPANY
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By:
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 |
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Name:
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Xxxxxx
X. Xxxxxxx
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Title:
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Senior
Vice President and General
Counsel
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EXHIBIT
A
The word
“including” shall mean including without limitation. Any reference to the
singular in this Agreement
shall also include the plural and vice versa. Certain Terms
Defined. As used in this Agreement, the following terms have the
following meanings:
“Accounts Receivable” means
all accounts receivable and notes receivable owed to the Seller as of the
Closing, including unpaid interest on any such accounts receivable and any
security or collateral relating thereto.
“Acquired Assets” has the
meaning set forth in Section 1.1. “Acquired Contracts” has the
meaning set forth in Section 1.1(d). “Affiliate” means, with
respect to any Person, any other Person directly or indirectly controlling,
controlled by or under direct or indirect common control with such Person. “Agreement” has the meaning
set forth in the Preamble. “Allocation” has the meaning
set forth in Section 6.3. “Alternative Transaction”
means a transaction involving a sale, pursuant to a Bankruptcy Court order, of
all of the Acquired Assets to a purchaser or purchasers other than Buyer. “Assignee” has the meaning set
forth in Section 11.3. “Assignable Liabilities” has
the meaning set forth in Section 11.3. “Assumed Liabilities” has the
meaning set forth in Section 1.3 “Baldwinsville Supermarket” has
the meaning set forth in Recital B. “Bankruptcy Case” has the
meaning set forth in Recital A. “Bankruptcy Code” has the
meaning set forth in Recital A. “Bankruptcy Court” has the
meaning set forth in Recital A. “Bankruptcy Rules” has the
meaning set forth in Recital C. “Bankruptcy Sale Order” has
the meaning set forth in Recital D. “Bradford Supermarket” has the
meaning set forth in Recital B. “Breach” means any breach of,
or any inaccuracy in, any representation or warranty or any breach of, or
failure to perform or comply with, any covenant or obligation, in or of this
Agreement or any other contract, or any event which with the passing of time or
the giving of notice, or both, would constitute such a breach, inaccuracy or
failure.
“Building” means the building
in which Seller operates a particular Supermarket “Business Day” means any day
other than Saturday, Sunday and any day that is a legal holiday or a day on
which banking institutions in New York City, New York are authorized by law or
other governmental action to close. “Buyer” has the meaning set
forth in the Preamble. “Buyer’s
Alternate Joint Bid” has the meaning given it in Section 8.1(h). “Buyer’s Deposit” has the
meaning given it in Section 2.2. “Camillus Lease” has the
meaning set forth in Schedule 1.1(d). “Camillus Supermarket” has the
meaning set forth in Recital B. “Camden Supermarket” has the
meaning set forth in Recital B. “Canastota Supermarket” has
the meaning set forth in Recital B. “Canton Lease” has the meaning
set forth in Schedule 1.1(d). “Canton Supermarket” has the
meaning set forth in Recital B. “Cazenovia Supermarket” has
the meaning set forth in Recital B. “Cash” means all cash and cash
equivalents. “Chittenago
Supermarket” has the meaning set forth in Recital B. “Claim” means all rights,
claims, causes of action, defenses, debts, demands, damages, obligations, and
liabilities of any kind or nature under contract, at law or in equity, known or
unknown, contingent or matured, liquidated or unliquidated, and all rights and
remedies with respect thereto, including, without limitation, causes of action
arising under chapter 5 of the Bankruptcy Code or similar state
statutes.
“Closing” has the meaning set
forth in Section 3.1. “Closing
Date” has the meaning set forth in Section 3.1. “Code” means the Internal
Revenue Code of 1986, as amended “Consents” has the meaning set
forth in Section 4.1(d). “Contract” means any written
contract, agreement, lease or sublease, license or sublicense, instrument,
indenture, commitment or undertaking. “Cure Amounts” has the meaning
set forth in Section 1.3. “Employee Benefit Plans” means
mean each employment, collective bargaining or consulting contract, or each
deferred compensation, profit sharing, pension, bonus, stock option, stock
purchase or other fringe benefit or compensation contract, commitment,
arrangement or plan (whether written or oral) for persons who are employed at
any of the Supermarkets, including each plan as defined in Sections 3(3) or
3(37)(A) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), which Seller
has established or maintained, or under which Seller has an obligation to make
contributions or to pay benefits for the benefit of persons employed at the
Supermarkets who are, were or will become entitled to such benefits in
accordance with the terms of such Employee Benefit Plan as employees, former
employees, retirees, directors or independent contractors (or their dependents,
spouses or beneficiaries) of Seller or its predecessor in interest or any
employer which would constitute an ERISA affiliate.
“ERISA” has the meaning set
forth in the definition of Employee Benefit Plans. “ERISA Affiliate” includes all
employers (whether or not incorporated) which by reason of common control are treated
together with Seller as a single employer within the meaning of Section 414 of
the Code. “Excluded
Assets” has the meaning set forth in Section 1.2. “Excluded Liabilities” has the
meaning set forth in Section 1.4. “Execution Date” has the
meaning set forth in the Preamble. “Fayetteville Supermarket” has
the meaning set forth in Recital B. “Gouverneur Parking Lot Lease”
has the meaning set forth in Schedule 1.1(d). “Gouverneur Supermarket” has
the meaning set forth in Recital B. “Government” means any agency,
division, subdivision or governmental or regulatory authority or any
adjudicatory body thereof, of the United States, or any state thereof. “HIPPA” has the meaning set
forth in Section 4.2(g). “HIPPA
Regulations” has the meaning set forth in Section 4.2(g). “Intellectual Property” means
any and all patents, patent applications, trademarks, service marks, trade
names, trade dress rights, internet domain names, trade secrets and copyrights;
foreign equivalent or counterpart rights having similar effect in any
jurisdiction throughout the world; and registrations and applications for
registration of any of the foregoing.
“Inventory” means all
inventory located in the Supermarkets.
“Knowledge of Buyer” or any
other similar term or knowledge qualification means the actual knowledge of
Price Chopper Operating Co., Inc., after due inquiry. “Knowledge of Seller” or any
other similar term or knowledge qualification means the actual knowledge of The
Penn Traffic Company, after due inquiry.
“Lien” means any mortgage,
pledge, security interest, encumbrance, lien (judicial, statutory or other),
conditional sale agreement, claim or liability. “Lincoln Supermarket” has the
meaning set forth in Recital B.
“Manlius Lease” has the
meaning set forth in Schedule 1.1(d). “Manlius Supermarket” has the
meaning set forth in Recital B. “Massena Lease” has the
meaning set forth in Schedule 1.1(d). “Massena Supermarket” has the
meaning set forth in Recital B. “Monro Muffler Lease” has the
meaning set forth in Schedule 1.1(d). “Motion Date” means the date
on which the Sale Motion is filed with the Bankruptcy Court. “NY WARN Act” means the New
York State Worker Adjustment and Retraining Notification
Act.
“Ordinary Course of Business”
means that an action taken by a Person will be deemed to have been taken
in the “Ordinary Course of Business” only if that action:
(i) is
consistent in nature, scope and magnitude with the past practices of such
Person, recognizing that the Seller has filed the Bankruptcy Case, and is taken
in the ordinary course of the normal day-to-day operations of such
Person;
(ii) does
not require authorization by the board of directors or shareholders of such
Person (or by any Person or group of Persons exercising similar authority) and
does not require any other separate or special authorization of any nature,
including prior approval of the Bankruptcy Court; and
(iii) is
similar in nature, scope and magnitude to actions customarily taken, without any
separate or special authorization, in the ordinary course of the normal
day-to-day operations of other Persons that are in the same line of business as
such Person, recognizing that the Seller has filed the Bankruptcy cases and may
be conducting going out of business sales or otherwise liquidating its inventory
(other than the Pharmacy Inventory) at the Supermarkets.
“Orders” means the Bankruptcy
Sale Order.
“Owned Machinery and
Equipment” has the meaning set forth in Section 1.1(a).
“Penn Yan Supermarket” has the
meaning set forth in Recital B.
“Person” means any individual,
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or
Government.
“Petition Date” has the
meaning set forth in Recital A.
“Pharmacy” has the meaning set
forth in Recital B.
“Pharmacy Inventory” means,
with respect to the Pharmacy, the entire inventory of saleable legend drug
products located in the Pharmacy on the Closing Date.
“Pharmacy Records” means, with
respect to the Pharmacy, all prescription files, prescription records and
patient refill history, with the exception of signature capture logs, as of the
Closing Date.
“Potsdam Lease” has the
meaning set forth in Schedule 1.1(d).
“Pulaski Supermarket” has the
meaning set forth in Recital B.
“Purchase Price” has the
meaning set forth in Section 2.1.
“Related Person” means, with
respect to any Person, all past, present and future directors, officers,
members, managers, stockholders, employees, controlling persons, agents,
professionals, attorneys, accountants, lenders, investment bankers or
representatives of any such Person.
“Secured Creditors” means
General Electric Capital Corporation and Kimco Capital Corp.
“Seller” has the meaning set
forth in the Preamble.
“Seller Parties” has the
meaning set forth in Section 9.2(b).
“Xxxxxxxx Supermarket” has the
meaning set forth in Recital B.
“Skaneateles Supermarket” has
the meaning set forth in Recital B.
“Supermarkets” has the meaning
set forth in Recital B.
“Supermarket Land” means the
real property owned by Seller on which and in which Seller operates (1)
Supermarket and (2) a Pharmacy, if any.
“Survival Period” has the
meaning set forth in Section 9.2(a).
“Syracuse Brewerton
Supermarket” has the meaning set forth in Recital B.
“Syracuse Nottingham
Supermarket” has the meaning set forth in Recital B.
“Tax Return” means any report,
return, information return, filing or other information, including any
schedules, exhibits or attachments thereto, and any amendments to any of the
foregoing required to be filed or maintained in connection with the calculation,
determination, assessment or collection of any Taxes (including estimated
Taxes).
“Taxes” means all taxes,
however denominated, including any interest, penalties or additions to tax that
may become payable in respect thereof, imposed by any Government, whether
payable by reason of contract, assumption, transferee liability, operation of
law or Treasury Regulation section 1.1502-6(a) (or any predecessor or successor
thereof or any analogous or similar provision under state, local or foreign
law), which taxes shall include all income taxes, payroll and employee
withholding unemployment insurance, social security (or similar), sales and use,
excise, franchise, gross receipts, occupation, real and personal property,
stamp, transfer, workmen’s compensation, customs duties, registration,
documentary, value added, alternative or add-on minimum, estimated,
environmental (including taxes under section 59A of the Code) and other
assessments or obligations of the same or a similar nature, whether arising
before, on or after the Closing Date.
“Termination Date” has the
meaning set forth in Section 8.1(b) “Total Consideration” has the
meaning set forth in Section 2.1. “Xxxxxxx Supermarket” has the
meaning set forth in Recital B. “Transaction Taxes” has the
meaning set forth in Section 6.1. “W. Carthage Supermarket” has
the meaning set forth in Recital B. “WARN Act” means the Worker
Adjustment and Retraining Notification Act.
