ASSET PURCHASE AGREEMENT
THIS AGREEMENT is hereby made this, April 30, 1998 by and between Xxxxx Outdoor
Advertising Co., a Texas corporation ("Xxxxx" or the "Company"), Xxxxxxx X.
Xxxxx, individually, the sole shareholder of Xxxxx Outdoor ("Shareholder"), and
Xxxxxx Outdoor Advertising & Travel Centers Incorporated, a Nevada corporation
("Xxxxxx").
Purpose of Agreement
Xxxxxx desires to purchase and Xxxxx desires to sell certain tangible and
intangible assets that comprise a certain portion of Edgar's business known as
"Xxxxx Outdoor Advertising Co." Therefore, in consideration of the premises and
of the mutual representations, warranties and covenants herein contained, the
parties hereby agree as follows:
Terms and Conditions
Purchase Price
The purchase price shall be a total of $900,000 paid at closing.
In addition to the amount specified above, Xxxxxx will pay to Xxxxx at closing:
(a) an amount equal to the amount of any prepaid rents, leases, permits and
taxes as specified in attached Exhibit E and incorporated for all purposes
herein
The purchase price, and payments noted above, shall be the sole considerations
paid by Xxxxxx under this agreement.
Date of Closing
The parties contemplate that Closing shall take place on May 1, 1998. If Closing
does not occur by that date, it will occur as soon thereafter as Xxxxxx is able
to complete its due diligence investigation. The parties agree that Xxxxxx'x
obligation to complete this purchase is contingent upon Xxxxxx being satisfied,
in its sole discretion, that all representations made to it concerning Edgar's
assets are true; that the financial condition, books, and accounts of Xxxxx are
sound; that the land leases, outdoor advertising permits and advertising
contracts are of satisfactory condition to Xxxxxx; and that the value of the
assets being transferred is not less than the purchase price. Transfer of Assets
to Xxxxxx, and Transfer of Funds to Xxxxxxx X. Xxxxx shall take place on May 1,
1998.
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Transfer of Assets
At closing, Xxxxx will sell, transfer, assign, convey and deliver to Xxxxxx free
and clear of any liens, debts, or encumbrances, and Xxxxxx will purchase, accept
and acquire from Xxxxx all of the Assets listed in Exhibit A attached hereto and
incorporated for all purposes herein.
In addition to the Assets listed in Exhibit A, Xxxxx will sell, transfer,
assign, convey and deliver to Xxxxxx the right to use the names "Xxxxx" and
"Xxxxx Outdoor Advertising Co." and variants of those names for a period of six
months or longer if circumstances require for Xxxxxx'x to have time to change
identifications on the signs acquired.
Instruments of Transfer
(a) Xxxxx and Shareholder's Deliveries. At the closing, Xxxxx shall
deliver to Xxxxxx:
i. A xxxx of sale transferring to Xxxxxx title to the Assets as
provided herein, in form and substance acceptable to Xxxxxx;
ii. A ten (10) year non-competition agreement for Xxxxxxx X. Xxxxx
(See attached Exhibit B);
iii. Letter(s) from Xxxxx and Shareholder to the Texas Department of
Transportation regarding transfer of the applicable outdoor
advertising permits from Shareholder to Xxxxxx in the form of
attached Exhibit F;
iv. Assignment of land lease agreements pertinent to sign sites
located on property owned by third parties (See attached Exhibit
G);
v. Such other bills of sale, titles and other instruments of
assignment, transfer and conveyance as Xxxxxx shall reasonably
request, in recordable form, where appropriate, and properly
executed, evidenced and notarized where appropriate in such form
as shall be necessary or appropriate to vest in Xxxxxx good title
to the Assets.
vi. A Corporate resolution signed by Xxxxx and Shareholder
authorizing Xxxxxxx X. Xxxxx to act on behalf of the corporation
and sell assets thereof.
(b) Xxxxxx'x Deliveries. At the closing, Xxxxxx shall deliver to Xxxxx:
i. A wire transfer for the cash portion of the purchase price as
specified herein;
ii. Checks in an amount sufficient to pay the net amount due for
items listed in Exhibit E, and
iii. A check payable to the Texas Highway Beautification Fund in the
amount of $1075.00 for the transfer of Edgar's outdoor
advertising permits (see attached Exhibit F).
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(c) Other Transfer Instruments. Following the Closing, at the request of
Xxxxxx, Xxxxx shall deliver any further Instruments and take all
reasonable action as may be necessary or appropriate to vest in Xxxxxx
all of Edgar's title to the assets.
No Assumption of Liabilities
It is expressly understood and agreed by the parties hereto that Xxxxxx
assumes no debts, liabilities (including tax liabilities) or obligations
(contractual or otherwise) of Xxxxx or Shareholder or any other debts,
liabilities or obligations related to the conduct of Edgar's business.
Representations and Warranties
Xxxxx and Shareholder represent and warrant to Xxxxxx as of the date hereof
and on the closing date as follows (all representations and warranties
being joint and several):
(a) Authority. Xxxxx has the legal authority to sell, transfer, and
deliver to Xxxxxx the tangible and intangible assets of the business
known as "Xxxxx Outdoor Advertising Co."
(b) Title. Xxxxx has good and indefeasible title to all properties, assets
and leasehold estates, real and personal, tangible and intangible, to
be transferred pursuant to this Agreement subject to no mortgage,
pledge, lien, conditional sales agreement, encumbrance or charge
except for mortgages, liens or encumbrances on the real property fee
simple estates of the ground lessors.
(c) Omitted
(d) Violations, Suits, Claims, etc. Xxxxx is not in default under any law
or regulation, or under any order of any court or federal, state,
municipal or other governmental department, commission, board, bureau,
agency or instrumentality wherever located, and to Edgar's knowledge
and belief there are (1) no claims, actions, suits or proceedings
instituted or filed and (2) no claims actions, suits or proceedings
threatened presently or which in the future may be threatened or
asserted against or affecting Xxxxx at law or in equity, or before or
by any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality wherever located,
and (3) there are no potential claims, demands, liens, encumbrances,
or debts with regard to the assets that are the subject of this sale
or that may create for Xxxxxx any environmental or regulatory
liability except for signs #110-#111-#128.
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(e) Tax Returns. Xxxxx has filed or will file all requisite federal, state
and other tax returns due for all fiscal periods ended on or before
the date of this agreement. There are no claims against Xxxxx for
federal, state or other taxes for any period or periods to and
including the date of this agreement.
(f) Sole Shareholder. Shareholder is the sole owner of all issued and
outstanding capital stock of the Company, and no other person has any
right to acquire shares of capital stock of the Company.
(g) Organization, Good Standing, Power, etc. Xxxxx (a) is a corporation
duly organized, validly existing and in good standing under the laws
of the State of Texas; and (b) has the requisite power and authority
to own, lease and operate its properties and to carry on its business
as currently conducted.
(h) Authorizations and Enforceability. Xxxxx has all requisite power and
authority to execute, deliver and perform this Agreement and the other
agreements and instruments delivered pursuant hereto and to consummate
the transactions contemplated hereby. This Agreement and the other
agreements and instruments delivered pursuant hereto have been duly
and validly authorized, executed and delivered by Xxxxx and
constitutes the valid and binding obligations of Xxxxx, fully
enforceable in accordance with their terms.
(i) Effect of Agreement. The execution, delivery and performance of this
Agreement by Xxxxx and Shareholder and the consummation of the
transactions contemplated hereby will not, with or without the giving
of notice or the lapse of time, or both: (a) violate any material
provision of law, statute, rule or regulation to which Company is
subject; (b) violate any judgment, order, writ or decree of any court,
arbitrator or governmental agency applicable to Company; or (c) result
in a material breach of or material conflict with any term, covenant,
condition or provision of, result in the modification or termination
of, constitute a material default under, or result in the creation or
imposition of, any lien, security interest, charge or encumbrance upon
any of the Assets pursuant to any charter, bylaw, commitment, contract
or other agreement or instrument, to which Company is a party or by
which any of its Assets is bound.
(j) Permits, Licenses, Compliance with Applicable Laws and Court Orders.
Company has all requisite corporate power and authority, and all
permits, licenses and approvals of governmental and administrative
authorities, to own, lease and operate its properties and to carry on
its business as presently conducted; all such permits, licenses and
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approvals material to the conduct of the business of Company are in
full force and effect. Company's conduct of its business does not
materially violate or infringe any applicable law, statute, ordinance
or regulation. Company is not in default in any respect under any
executive, legislative, judicial, administrative or private (such as
arbitration) ruling, order, writ, injunction or decree. EXCEPT AS
LISTED: City of Gainesville permits for #110 and #111 have not been
paid for 1997 and have not been invoiced for 1998. No state permit was
required when these signs were built. The following signs were
acquired from other companies and no city permits were required when
the signs were built, but may now be required for new signs. These
signs are as follows: City of Athens:
#301-#302-#303-#304-#306-#307-#308-#309-#311-#313, Xxxxx #122-#123,
Rice -#124, and Corsicana -#125-#126-#127.
(k) Financial Information. All financial information relating to the
Assets or the business and provided to Xxxxxx by Xxxxx have been
prepared from the books and records of seller in accordance with
generally accepted accounting principles and fairly and accurately
present the financial condition of Xxxxx and the business relating to
the Assets as of the date of such information.
(l) Absence of Undisclosed Liabilities. Xxxxx has no liabilities other
than those that are expressly disclosed in the financial information
provided to Xxxxxx. Between the date of this Agreement and the
Closing, there will be no material change in the financial position of
Xxxxx.
(m) Agreements, Plans, Arrangements, etc. Except as set forth in Exhibit
A, Company is not a party to, nor is Company or any of the Assets
bound or affected by, any oral or written:
(1) lease agreement (whether as lessor or lessee) relating to real or
personal property;
(2) license agreement, assignment or other contract (whether as
licensor or licensee, assignor or assignee) relating to
trademarks, trade names, patents, copyrights (or applications
therefor);
(3) agreement with any business broker with respect to this
transaction;
(4) agreement with any supplier, distributor, franchisor, dealer,
sales agent or representative;
(5) joint venture or partnership agreement with any other person;
(6) agreement with any bank, factor, finance company or similar
organization regarding the financing of accounts receivable or
other extensions of credit;
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(7) agreement granting any lien, security interest or mortgage on any
Asset or other property of Company, including, without
limitation, any factoring agreement for the assignment of
accounts receivable;
(8) agreement for the Construction or modification of any Asset or
leasehold interest of Company except #148 is still under
construction but will be finished by Xxxxx as soon as possible
with all associated liabilities paid;
(9) agreement with any employee, consultant, or independent
contractor providing personal services to Company.
(n) Acquisition Agreements. There are no agreements relating to the
acquisition of the stock, business or Assets of Company to which
Company is a party, other than this Agreement.
(o) Status of Real Property. Neither Company nor Shareholder has received
any notice of noncompliance with respect to real property on which any
of the Assets are located (the "Real Property") with any applicable
statutes, laws, codes, ordinances, regulations or requirements
relating to fire, safety, health or environmental matters or
noncompliance with any covenants, conditions and restrictions (whether
or not of record) or local, municipal, regional, state or federal
requirements or regulations. To the best of Company's and
Shareholder's knowledge, there has been no release or discharge on or
under the Real Property by the Company of any toxic or hazardous
substance, material or waste which is or has been regulated by any
governmental or quasi-governmental authority or is or has been listed
as toxic or hazardous under any applicable local, state or federal
law. To the best of the Company's and Shareholder's knowledge, there
are no subsurface or other conditions related to toxic or hazardous
waste affecting the Real Property or any portion or component thereof,
and there are no underground storage tanks located on the Real
Property.
(p) Defects. To the best of Company's and Shareholder's knowledge, there
are no structural or operational defects in any of the Assets.
(q) Leases Current. All obligations of the Company under all existing
lease agreements which are required by such agreements to have been
performed by Company have been fulfilled by the Company, including the
payment by the Company of all lease payments due and payable through
the date hereof, except for the following: Lease #110 (Gainsville -
not paid) -#113-#128 (Corsicana - no contact) -#124 (Month to Month
lease-new land owner as of April wants to renegotiate)-#144 (Xxxxxx -
has not paid).
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Xxxxxx represents and warrants to Xxxxx and Shareholder as of the date hereof
and the Closing date as follows:
(a) Organization. Xxxxxx is a validly existing corporation organized under
the laws of the State of Nevada and has all requisite corporate power
and authority to own, operate and lease its properties and assets.
(b) Authority. Xxxxxx has full corporate power, authority and legal rights
to execute and deliver, and to perform its obligations under this
Agreement, and has taken all necessary action to authorize the
purchase hereunder on the terms and conditions of this Agreement and
to authorize the execution, delivery and performance of this
Agreement. This Agreement has been duly executed by Xxxxxx, and
constitutes a legal, valid and binding obligation of Xxxxxx
enforceable in accordance with its terms.
(c) Compliance with Instruments, Consents, Adverse Agreements. Neither the
execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will conflict with or result in any
violation of or constitute a default under the articles of
incorporation or the by-laws of Xxxxxx, or any Law, Instrument, lien
or other Contract by which Xxxxxx is bound. Xxxxxx is not a party or
subject to any Contract, or subject to any article or other corporate
restriction or any Law which materially and adversely affect the
business operation, prospects, properties, assets or condition,
financial or otherwise, of Xxxxxx.
(d) Litigation. There is no suit, action or litigation, administrative,
arbitration, or other proceeding or governmental investigation pending
or, to the knowledge of Xxxxxx, threatened which might, severally or
in the aggregate materially and adversely affect the financial
condition or prospects of Xxxxxx or Xxxxxx'x ability to acquire the
Assets as contemplated by this Agreement.
(e) Brokers. All negotiations relative to the Agreement and the
transactions contemplated hereby have been carried on by Xxxxxx is
such manner without giving rise to any valid claim against Xxxxx for a
finder's fee, brokerage commission or other like payment.
Covenants
Between the date of this agreement and the closing date:
(a) Edgar's officers will cause Company to:
(1) Carry on its outdoor advertising business in substantially the
same manner as it has heretofore and not introduce any material
new method of management, operation or accounting;
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(2) Maintain their properties and facilities in as good working order
and condition as at present, ordinary wear and tear excepted;
(3) Perform all material obligations under agreements relating to or
affecting its assets, properties and rights;
(4) Omitted; and
(5) Use its best efforts to maintain and preserve its assets intact,
and maintain its relationships with suppliers, customers and
others having business relations with it.
(b) Edgar's officers will not permit Xxxxx without the prior written
consent of Xxxxxx to:
(1) Enter into any contract or commitment or incur or agree to incur
any liability or make any capital expenditures except in the
normal course of business as to the assets purchased pursuant to
this agreement.
(2) Create, assume or permit to exist any mortgage, pledge or other
lien or encumbrance upon any assets or properties transferred
under this agreement, whether now owned or hereafter acquired; or
(3) Sell, assign, lease or otherwise transfer or dispose of any
property or equipment subject to this agreement except in the
normal course of business.
Competition
Simultaneously with the execution of this Agreement, Xxxxxxx X. Xxxxx will
execute and deliver to Xxxxxx a Non-Competition Agreement in the form and
on the terms as set forth in Exhibit B attached hereto and incorporated by
reference herein for all purposes.
Conditions to Xxxxxx'x Obligations
The obligations of Xxxxxx hereunder are subject to the fulfillment, at or
prior to the Closing, of each of the following conditions, any or all of
which may be waived in writing by Xxxxxx, in its sole discretion:
(a) Accuracy of Representations and Warranties. Each of the
representations and warranties of Xxxxx and Shareholder contained in
this Agreement shall be true on and as of the Closing Date with the
same force and effect as though made on and as of the Closing Date,
except as affected by transactions contemplated hereby.
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(b) Performance of Covenants. Xxxxx shall have performed and complied with
all covenants, obligations and agreements to be performed or complied
with by it on or before the Closing Date pursuant to this Agreement.
(c) No Litigation or Claims. No claim, action, suit, proceeding,
arbitration, investigation or hearing or notice of hearing shall be
pending or threatened against or affecting Xxxxx which: (a) might
foreseeably result, or has resulted, either in an action to enjoin or
prevent or delay the consummation of the transactions contemplated by
this Agreement or in such an injunction; or (b) could, in the
determination of Xxxxxx, have an adverse effect on the assets to be
transferred hereunder.
(d) No Violations. No material violation of Xxxxx shall exist, or be
alleged by any governmental authority to exist, of any law, statute,
ordinance or regulation, the enforcement of which would adversely
affect the financial condition, results of operations, properties or
business of Xxxxx except for City of Gainesville permits for 1997 on
signs #110-#111 that have not been paid.
(e) Consents and Assignments. Xxxxx shall have delivered to Xxxxxx all
consents and assignments of all persons and entities necessary for the
performance of the transactions contemplated by this Agreement,
including the transfer of all assets and the assignment of leases, and
Xxxxx shall have obtained the consents of: any lender to Xxxxx, or, in
the alternative, the release of all liens held by such lender, with
respect to the sale and transfer of the assets; and any other consents
of third parties deemed necessary or appropriate by Xxxxxx.
(f) Certificate. Xxxxxx shall have received a certificate signed by Xxxxx
and Shareholder, dated the Closing Date, satisfactory in form and
substance to Xxxxxx and its counsel, certifying as to the fulfillment
of the conditions specified above.
(g) Satisfactory Completion of Due Diligence. Xxxxxx shall be satisfied in
its sole discretion with the content of the final Exhibits hereto and
other related documents for closing and shall otherwise be satisfied
in its sole discretion with the results of its due diligence review,
including the right to terminate this agreement with no penalty in the
event that the land leases, outdoor advertising permits and
advertising contracts are not of satisfactory condition to Xxxxxx.
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Indemnification
(a) Indemnification of Xxxxxx by Xxxxx and Shareholder. Xxxxx and
Shareholder, jointly and severally, agree to indemnify and hold
harmless Xxxxxx and any person claiming by or through it or its
successors and assigns from, against and in respect of any and all
losses, claims, and liabilities incurred by or asserted against Xxxxxx
or its successors or assigns in connection with any breach of any
representation or warranty of Xxxxx or Shareholder;
(i) any breach of any representation or warranty of Xxxxx or
Shareholder;
(ii) any breach of any covenant or agreement made by Xxxxx or
Shareholder in this Agreement;
(iii)any liability, debt or obligation of Xxxxx or lien or
encumbrance on the Assets or (iv) any claim arising out of the
use, sale or operation of the Assets by Xxxxx or Shareholder
and/or the operation of the business of Xxxxx or Shareholder
prior to the Closing.
(b) Indemnification of Xxxxx and Shareholder by Xxxxxx. Xxxxxx agrees to
indemnify and hold harmless Xxxxx and Shareholder and any person
claiming by or through it or its successors and assigns from, against
and in respect of any and all losses, claims, and liabilities incurred
by or asserted against Xxxxx or Shareholder or its successors or
assigns in connection with:
(i) any breach of any representation or warranty of Xxxxxx;
(ii) any breach of any covenant or agreement made by Xxxxxx in this
Agreement;
(iii)any act or omission of Xxxxxx after Closing, and
(iv) any claim arising out of the use, sale or operation of the Assets
by Xxxxxx and/or the operation of the business by Xxxxxx after
Closing.
Taxes
Real Estate and personal property taxes, if any, assessed or to be assessed
for the current calendar or fiscal year, regardless of when payable, shall
be prorated between Xxxxxx and Xxxxx as of the closing date.
Risk of Loss
The risk of loss or destruction of or damage to the assets transferred
hereunder from any cause whatsoever at all times on or subsequent to the
execution of this document but before closing shall be borne by Xxxxx.
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Xxxxxx'x Remedies
Xxxxxx shall be entitled, without limitation, to all incidental and
consequential damages resulting from a breach of any warranty or
representation or covenant of Xxxxx or Shareholder made herein including,
but not limited to, all costs of litigation incurred, including reasonable
attorney's fees.
Arbitration Dispute Resolution
In the event of any dispute arising from this agreement, Texas law shall
apply. Any claims or controversy between Xxxxx or its officers or
shareholders, on the one hand, and Xxxxxx, on the other hand, arising out
of or relating to this agreement or the sale and purchase of assets, shall
be decided by arbitration at Dallas, TX in accordance with Commercial
Arbitration Rules of the American Arbitration Association by a single
arbitrator appointed in accordance with the rules in effect when
arbitration is first demanded by any party. The award rendered by the
arbitrator shall be final and judgment may be entered into any court having
jurisdiction.
Miscellaneous
(a) Expenses. Except as otherwise provided herein, whether or not the
transactions contemplated by this Agreement are consummated, each
party hereto shall pay its own expenses and the fees and expenses of
its counsel and accountants and other experts. Furthermore, Xxxxxx
shall be responsible for payment to the business broker retained by
it.
(b) Survival of Representations and Warranties. The representations,
warranties, covenants and agreements set forth in this Agreement and
any other written representation in any ancillary document shall
survive the Closing.
(c) Waivers. The waiver by any party hereto of a breach of any provision
of this Agreement shall not operate or be construed as a waiver of any
subsequent breach.
(d) Binding Effect; Benefits. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and assigns.
(e) Notices. All notices, requests, demands and other communications which
are required to be or may be given under this Agreement shall be in
writing and shall be deemed to have been duly given when delivered in
person or transmitted by fax or five (5) days after deposit in the
U.S. mails by certified or registered first class mail, postage
prepaid, return receipt requested, addressed to the party to whom the
same is so given or made.
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if to Xxxxx or Shareholder to:
Xxxxxxx X. Xxxxx
X.X. Xxx 00000
Xxxxxxxxx, XX 00000
if to Xxxxxx to:
Xxxxxx Outdoor Advertising and Travel Centers Incorporated
000 Xxxxxxxxx Xxxx. X.X.
Xxxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, President
or to such other address or Fax Number as any party may designate by giving
notice to the other parties hereto.
(f) Further Assurances. The Company and Shareholder shall, from time to
time at or after the Closing, at the request of Xxxxxx, and without
further consideration, execute and deliver such other instruments and
take such other actions as may be required to confer to Xxxxxx and its
assignees the benefits contemplated by this Agreement.
(g) Entire Agreement. This document contains the entire agreement between
the parties and supersedes all prior agreements between the parties,
if any, written or oral, with respect to the subject matter thereof.
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AGREED and ACCEPTED:
XXXXXX OUTDOOR ADVERTISING & TRAVEL CENTERS INCORPORATED
By: /s/ C. XXXXXXXXXXX XXXX
------------------------------------
X. X. Xxxx, Executive Vice President
XXXXX OUTDOOR ADVERTISING CO.
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx, President
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx, Individually
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Acknowledgment for Corporations
STATE OF TEXAS )
) ss.
COUNTY OF _____________ )
The foregoing instrument was acknowledged before me this [ ] day of
[ ], 199[ ], by X. X. Xxxx, Executive Vice President of Xxxxxx
Outdoor Advertising & Travel Centers Incorporated, a Nevada Corporation, on
behalf of the corporation.
--------------------------------
Notary Public
My commission expires:
----------------------
Acknowledgment for Corporations
STATE OF TEXAS )
) ss.
COUNTY OF ____________ )
The foregoing instrument was acknowledged before me this [ ] day of
[ ], 199[ ] by Xxxxxxx X. Xxxxx, President of Xxxxx Outdoor
Advertising Co., a Texas Corporation, on behalf of the corporation.
--------------------------------
Notary Public
My commission expires:
----------------------
Acknowledgment for Individual
STATE OF TEXAS )
) ss.
COUNTY OF ___________ )
The foregoing instrument was acknowledged before me this [ ] day of
[ ], 199[ ] by Xxxxxxx X. Xxxxx, Individually.
--------------------------------
Notary Public
My commission expires:
----------------------
