REAL ESTATE PURCHASE AGREEMENT
among
T & B LEASING, A NORTH CAROLINA GENERAL PARTNERSHIP,
THE PARTNERS OF T & B LEASING
and
CASTLE PROPERTIES, L.L.C.,
A DELAWARE LIMITED LIABILITY COMPANY
REAL ESTATE PURCHASE AGREEMENT
THIS REAL ESTATE PURCHASE AGREEMENT (the "Agreement") is made and entered
into this 7th day of March, 1997, among T & B LEASING, a North Carolina general
partnership ("Seller"); XXXXXX XXXXXXXX and XXXXXXX XXXXXXXX (collectively
referred to as the "Partners"), and CASTLE PROPERTIES, L.L.C., a Delaware
limited liability company ("Purchaser").
RECITALS
WHEREAS, Seller owns the real estate and improvements for thirteen (13)
Burger King(R) restaurants and the improvements only on two (2) other Burger
King(R) restaurants;
WHEREAS, each of the Partners is a general partner of Seller and the
Partners are the only general partners of Seller;
WHEREAS, Seller desires to sell, assign, transfer and deliver to Purchaser,
and Purchaser desires to purchase from Seller, such real estate and
improvements, as described in Article I hereof, on the terms and subject to the
conditions hereinafter contained;
WHEREAS, Purchaser and the Partners desire to enter into certain agreements
between them on the terms and subject to the conditions hereinafter contained.
NOW THEREFORE, in consideration of the Recitals, which shall be deemed to
be a substantive part of this Agreement, and the mutual covenants, promises,
agreements, representations and warranties contained in this Agreement, the
parties hereto do hereby covenant, promise, agree, represent and warrant as
follows:
ARTICLE I -- PURCHASE AND SALE OF ASSETS
1.1 Purchase and Sale. On the terms and subject to the conditions set
forth in this Agreement, at the Closing on the Closing Date (as such terms are
defined in Section 2.1 hereof), Seller shall sell, convey, assign, transfer and
deliver to Purchaser and Purchaser shall purchase and accept from Seller all of
the right, title and interest of Seller in and to the property described below:
1.1.1 Fee simple title to all of the land (the "Land") and
improvements (the "Improvements") more fully described on Exhibit 1.1 attached
hereto and incorporated by reference herein.
1.1.2 All of Seller's right, title and interest as lessor in all
leases covering the Land and Improvements (said leases, together with any and
all amendments, modifications or supplements thereto, are hereinafter referred
to collectively as the "Store Leases").
1.1.3 All of Seller's right, title and interest as lessee in all
ground leases upon which any of the Improvements are situated (said leases,
together with any and all amendments, modifications or supplements thereto, are
hereinafter referred to collectively as the "Ground Leases" and are identified
on Exhibit 1.1.3 attached hereto and incorporated by reference herein).
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1.1.4 All rights, privileges, easements and appurtenances to the
Land and the Improvements, if any, including, without limitation, all of
Seller's right, title and interest in and to all mineral and water rights and
all easements, rights-of-way and other appurtenances used or connected with the
beneficial use or enjoyment of the Land and the Improvements (the Land, the
Improvements and all such easements and appurtenances, including, without
limitation, Seller's interest as lessor under the Store Leases and as lessee
under the Ground Leases, are sometimes collectively hereinafter referred to as
the "Real Property").
1.1.5 All fixtures, if any, owned by Seller and located on the Land
and/or Improvements including, but not limited to, the items described on
Exhibit 1.1.5 attached hereto and incorporated by reference herein (the
"Fixtures").
1.1.6 The service contracts listed and described on Exhibit 1.1.6
attached hereto and incorporated by reference herein (the "Assumed Service
Contracts").
1.1.7 All right, title and interest of Seller, if any, in and to all
site plans, surveys, soil and substratus studies, architectural drawings, plans
and specifications, engineering, electrical and mechanical plans and studies,
floor plans, landscape plans, and other plans and studies of any kind if
existing and in Seller's possession or control that relate to the Real Property
or the Fixtures (collectively the "Property Documents"). (The Real Property,
Fixtures, Assumed Service Contracts and Property Documents are sometimes
collectively hereinafter referred to as the "Property").
1.2 Purchase Price; Allocations. The purchase price for the Property is
Fifteen Million Two Hundred Seventy Five Thousand Five Hundred Fifty One and
no/100 Dollars ($15,275,551.00) (the "Purchase Price"), and shall be subject to
the adjustments and prorations provided herein. The parties agree that the
Purchase Price for the Property shall be allocated among the Property in the
manner set forth on Exhibit 1.2 attached hereto.
1.3 Liabilities of Seller. Except as set forth in this Section 1.3, Seller
shall be and remain solely liable and responsible for all debts, obligations,
duties, and liabilities of Seller and its business. Purchaser does not and shall
not assume, agree to pay or pay any debts, obligations, duties or liabilities of
any nature of Seller or its business. Notwithstanding the foregoing, Purchaser
agrees to assume from and after the Closing Date all of the rights and
obligations of Seller attributable to the period from and after the Closing Date
under the Store Leases, the Ground Leases and the Assumed Service Contracts.
(The Store Leases, the Ground Leases and the Assumed Service Contracts are
sometimes collectively hereinafter referred to as the "Assumed Contracts").
1.4 Prorations. All rents payable under the Ground Leases, utilities and
all other operating expenses for the Property, pre-paid or incurred, for the
current year and general real estate, personal property and ad valorem taxes and
special assessments, if any, pertaining to the Property for the current tax year
shall be prorated at the Closing effective as of 12:01 AM on the Closing Date.
If the Closing shall occur before the tax rate(s) are fixed for any ad valorem
taxes to be prorated hereunder, the apportionment of such taxes shall be upon
the basis of the most recent ascertainable taxes, and shall be represented and
adjusted between the parties upon availability of the actual bills therefor. At
the Closing, the parties shall execute a "Proration Adjustment Letter,"
substantially in the form attached hereto as Exhibit 1.4, pursuant to which the
parties shall agree to adjust the proration of operating expenses and taxes of
the Property for the year 1997.
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Pursuant to the Proration Adjustment Letter, the parties shall also agree to
adjust the proration of real estate taxes for the year 1997. Security deposits,
if any, pursuant to the Ground Leases shall be paid by and credited to
Purchaser. Except as set forth in this Section 1.4, all items of income and
expense which accrue for the period prior to the Closing will be for the account
of Seller and all items of income and expense which accrue for the period on and
after the Closing will be for the account of Purchaser. The provisions of this
Section 1.4 shall survive the Closing.
1.5 Casualty Loss. All risk of loss to the Property shall remain upon
Seller prior to the Closing. If, prior to the Closing, any portion of the
Property is damaged or destroyed by fire or other casualty to a material extent,
Purchaser may, at its option, (a) terminate this Agreement by written notice to
Seller, in which event this Agreement will become null and void and be of no
further effect, and neither Seller nor Purchaser will have any further rights or
obligations hereunder, except for those obligations which, by their express
terms, survive termination of this Agreement, or (b) receive an assignment of
insurance proceeds (with payment by Seller of any deductible) as below
described. Unless otherwise provided herein, the term "material" shall mean
damage or destruction, the cost of repairing which exceeds One Hundred Thousand
Dollars ($100,000). If, prior to the Closing, any portion of the Property is
damaged or destroyed by fire or other casualty to less than a material extent,
Purchaser shall have no right to terminate this Agreement by reason thereof, and
Seller shall either repair the same prior to Closing, at Seller's expense, or
reimburse Purchaser for the cost of repairing the same by assigning any
insurance proceeds resulting therefrom to Purchaser and paying to Purchaser the
difference between the amount of the proceeds and the cost of repair, or by
allowing Purchaser to deduct such cost from the cash payable to Seller at the
Closing. If the extent of damage or the amount of insurance proceeds to be made
available is not able to be determined prior to the Closing Date specified
below, or the repairs are not able to be completed prior to said date, then
either party, by written notice to the other, may postpone the date of the
Closing to such date as shall be designated in such notice, but not more than
thirty (30) days after the Closing Date specified below.
ARTICLE II -- CLOSING AND TERMINATION
2.1 Time, Date and Place. The closing of the purchase and sale of the
Property and the other transactions contemplated by this Agreement (referred to
throughout this Agreement as the "Closing") shall take place at the offices of
Xxxxxx & Xxxxxxx, L.L.P., Suite 4000, 100 North Xxxxx Street, Charlotte, North
Carolina, or such other place that Purchaser shall determine. The time, place
and date of the Closing are referred to throughout this Agreement as the
"Closing Date."
Unless this Agreement is terminated as provided for herein, the Closing
shall occur on May 23, 1997, or ten (10) days following the completion of all of
the Conditions Precedent outlined in Article VII below, whichever is later.
2.2 Termination.
2.2.1 If the Closing contemplated hereunder has not occurred on or
before June 30, 1997, either Purchaser or Seller may terminate this Agreement
upon written notice to the other party.
2.2.2 If any of the representations, warranties or covenants of
Seller or the Partners are found to be untrue or breached in any material
respect, at or prior to Closing, and Seller or the Partners shall
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not have cured such breach within 30 days after Purchaser shall have given
written notice to Seller of the existence of such breach, Purchaser may
terminate this Agreement upon written notice to Seller.
2.2.3 If any of the representations, warranties or covenants of
Purchaser are found to be untrue or breached in any material respect, at or
prior to Closing, and Purchaser shall not have cured such breach within 30 days
after Seller shall have given written notice to Purchaser of the existence of
such breach, Seller may terminate this Agreement upon written notice to
Purchaser.
2.2.4 This Agreement may be terminated by the written agreement of
Purchaser and Seller. This Agreement may be terminated by Purchaser in its sole
discretion if any of the contingencies set forth in Section 7.2 is not met to
Purchaser's satisfaction.
2.2.5 This Agreement may be terminated by Purchaser if the Exhibits
hereto are not furnished in accordance with Section 5.1.14 hereof, or are found,
in Purchaser's sole discretion, to be unacceptable within five (5) business days
following receipt by Purchaser thereof and of the letter required by Section
5.1.14.
2.3 Effect of Termination. In the event of the termination and abandonment
of this Agreement pursuant to Section 2.2, this Agreement shall be of no further
force and effect, and except as specifically provided herein, with no
liabilities or obligations to any party under this Agreement; provided, however,
that the parties shall not be released from any liabilities, claims or actions
regarding the falsity in any material respect of a representation or warranty
set forth in Article III or Article IV or a failure to perform or comply with
any material obligation under this Agreement.
2.4 Expenses. Seller shall pay the following closing costs: (1) the cost
of preparing the Surveys (as hereinafter defined) and (2) state, county, and, if
applicable, municipal transfer taxes, sales taxes, documentary fees and deed
recording costs. Purchaser shall pay the following closing costs: (1) the
premium and other charges of the title company for issuing the Title Policy (as
hereinafter defined) and (2) the fees of the title company or its affiliate for
handling the Closing. Each party shall pay the fees and expenses of its own
legal counsel and, except as provided above, the cost of obtaining or preparing
each document to be delivered by such party at Closing. Except as provided
above and set forth below, Purchaser shall pay all expenses associated with
Purchaser's investigation of the Property, including, but not limited to, the
fees and expenses of any third parties, such as environmental consultants
conducting Phase I or Phase II environmental assessments, engaged by Purchaser
with respect thereto.
ARTICLE III -- REPRESENTATIONS AND WARRANTIES
OF SELLER AND PARTNERS
Seller and the Partners, jointly and severally, represent and warrant to
Purchaser as of the date hereof and as of the Closing on the Closing Date each
of the following:
3.1 Ownership of Seller. The Partners are the sole and exclusive owners
of all of the partnership interests of Seller. The Partners have duly approved
Seller's sale, assignment, transfer and delivery of the Property to Purchaser in
accordance with the terms of this Agreement and the consummation of all the
transactions contemplated hereby.
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3.2 Due Organization; Name and Address; Good Standing, Authority of
Seller. Seller is a general partnership duly organized, validly existing and in
good standing under the laws of the State of North Carolina. The only name and
business address of Seller which has been used by Seller at any time within the
past three years ending at the date of this Agreement is T & B Leasing, 0000
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxx Xxxxxxxx. Seller has full right, power
and authority to own and lease its properties and assets. Seller is not, and has
not been within the past three years ending at the date of this Agreement,
engaged in any active line of business and, during such period, its sole
business has been owning and leasing its properties and assets. Seller is duly
licensed, qualified and authorized to do business in each jurisdiction in which
the location or nature of the Property make such licensing, qualification and
authorization legally necessary. Except as disclosed on Exhibit 3.2, Seller is
not in breach or violation of, and the execution, delivery and performance of
this Agreement will not result in a breach or violation of, any of the
provisions of Seller's partnership agreement, as amended to the date of this
Agreement or other governing documents (the "Governing Documents"), or any
agreement to which it is a party.
3.3 Authorization and Validity of Agreements. Seller and the Partners
have the legal capacity, right, power, and authority to enter into this
Agreement. Seller has the full right, power and authority to execute,
acknowledge and deliver this Agreement and to perform the transactions
contemplated by this Agreement. The execution, acknowledgment and delivery of
this Agreement by Seller and the Partners and the performance by Seller and the
Partners of the transactions contemplated hereby have been duly and validly
authorized by all necessary partnership and partner action. This Agreement has
been duly executed, acknowledged and delivered by Seller and the Partners and is
the legal, valid and binding obligation of Seller and the Partners enforceable
against Seller and the Partners, respectively, in accordance with its terms,
except in each case as such enforceability may be limited by general principles
of equity, bankruptcy, insolvency, moratorium and similar laws relating to
creditors rights generally.
3.4 Agreement Not in Conflict with Other Instruments; Required Approvals
Obtained. Except as disclosed on Exhibit 3.4, the execution, acknowledgment,
delivery, and performance of this Agreement by the parties thereto, and the
consummation of the transactions contemplated by this Agreement will not (a)
materially violate or require any consent, approval, or filing under, (i) any
common law, law, statute, ordinance, rule or regulation (collectively referred
to throughout this Agreement as "Laws") of any federal, state or local
government (collectively referred to throughout this Agreement as "Governments")
or any agency, bureau, commission, instrumentality or judicial body of any of
the Governments (collectively referred to throughout this Agreement as
"Governmental Agencies") except that which may be required by the Xxxx-Xxxxx-
Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR Act"), or (ii)
any judgment, injunction, order, writ or decree of any court, arbitrator,
Government or Governmental Agency by which Seller or any of the Property is
bound; (b) conflict with, require any consent, approval, or filing under, result
in the breach or termination of any provision of, constitute a default under, or
result in the creation of any claim, security interest, lien, charge, or
encumbrance upon any of the Property pursuant to (i) Seller's Governing
Documents, (ii) any indenture, mortgage, deed of trust, license, permit,
approval, consent, franchise, lease, contract, or other instrument, document or
agreement to which Seller is a party or by which Seller, or any of the Property
is bound, or (iii) any judgment, injunction, order, writ or decree of any court,
arbitrator, Government or Governmental Agency by which Seller or any of the
Property is bound. All permits, licenses and authorizations of any Government or
Governmental Agency required to be obtained by Seller prior to the Closing,
shall have been obtained and shall be in full force and effect as of the Closing
Date.
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3.5 Conduct of Business in Compliance with Regulatory and Contractual
Requirements. Seller has conducted and is conducting its business in material
compliance with all applicable Laws of all Governments and Governmental
Agencies.
3.6 Legal Proceedings. There is no action, suit, proceeding, claim or
arbitration, or to the best of Seller's and the Partners' knowledge any
investigation by any person or entity, including, but not limited to, any
Government or Governmental Agency, (i) pending, to which Seller or the Partners
are a party, or threatened against or relating to Seller, Seller's business or
the Property, or (ii) challenging Seller's or the Partners' right to execute,
acknowledge, deliver, perform under or consummate the transactions contemplated
by this Agreement or (iii) asserting any right with respect to any of the
Property, and, in each such case, there is no basis for any such action, suit,
proceeding, claim, arbitration or investigation.
3.7 Financial Information. Attached hereto as Exhibit 3.7 are copies of
the unaudited Balance Sheets of Seller as of December 31, 1994, 1995, 1996, and
the Operating Statements of Seller for each of the three fiscal years then
ended, which are being provided by Seller and the Partners to Purchaser (the
"Financial Statements"). The Financial Statements are in accordance with the
books and records of Seller, are true and correct and accurately present
Seller's financial position in all material respects as of the dates set forth
therein and the results of Seller's operations for the periods then ended; all
such Financial Statements are in conformity with the accounting principles
historically utilized by Seller and applied on a consistent basis during each
period and on a basis consistent with that of prior periods. Until the Closing
Date, Seller shall deliver to Purchaser month end balance sheets and income
statements within twenty (20) days of the end of each month.
3.8 Tax Matters. All tax returns of Seller as filed by Seller with the
Internal Revenue Service (the "IRS") and all information reported on the returns
are true, accurate, and complete in all material respects. Seller is not a
party to any pending , and is not aware of any threatened action, suit,
proceeding, or assessment against it for the collection of taxes by any
Government or Governmental Agency. Seller has duly and timely filed with all
appropriate Governments and Governmental Agencies, all tax returns, information
returns, and reports required to be filed by Seller. Seller has paid in full
all taxes, interest, penalties, assessments and deficiencies owed by Seller to
all taxing authorities, except for such amounts not yet due and payable. All
taxes and other assessments and levies which Seller is required by applicable
Law to withhold or to collect have been duly withheld and collected and have
been paid over to the proper Governments and Governmental Agencies or are
properly held by Seller for such payment. All claims by the IRS or any state
taxing authorities for taxes due and payable by Seller have been paid by Seller.
Seller is not a party to any pending , and is not aware of any threatened
action, suit, proceeding, or assessment against it for the collection of taxes
by any Government or Governmental Agency.
3.9 Title to Property. Except for the Permitted Exceptions (as
hereinafter defined), Seller has sole and exclusive, good and marketable title
to all of the Property and the same shall be free and clear of any and all
pledges, claims, threats, liens, restrictions, agreements, leases, security
interests, charges and encumbrances at the time of Closing. All of the Property
is in good, working and operating condition and repair, reasonable wear and tear
excepted and free from any material defects known to Seller or to the Partners.
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3.10 Records. Seller's books and records pertaining to the Property (the
"Records") have been delivered by Seller to Purchaser or shall be delivered by
Seller to Purchaser, and such Records are true, complete and correct in all
material respects.
3.11 Absence of Certain Changes or Events. Since December 31, 1996,
Seller has not engaged in or experienced any of the following:
3.11.1 Sold, assigned, transferred, leased, disposed of, or agreed to
sell, assign, transfer, lease, or dispose of, any of the Property, except in the
ordinary course of Seller's business, as such business has been operated
historically.
3.11.2 Suffered any material adverse change in Seller's operations,
earnings, assets, liabilities, or business (financial or otherwise).
3.11.3 Except as set forth in Exhibit 3.11.3, failed to pay any
indebtedness or other obligation, including any taxes and other charges, when
due.
3.12 Adverse Conditions. Except as set forth in Exhibit 3.12, attached
hereto and incorporated by reference herein, there are no past, present or
future conditions, facts or circumstances which have materially affected or
which might materially affect adversely the Property or Purchaser's intended use
thereof, excluding general economic, financial and market conditions that are
known to the public.
3.13 Leases and Contracts. Except for the Assumed Contracts, and except
for service contracts that will be canceled as of the Closing Date, there are no
leases, contracts, licenses, agreements or other commitments of Seller as
obligor involving a liability, obligation, contingent liability or contingent
obligation in excess of $5,000 per Restaurant. Each of the Assumed Contracts
are in full force and effect and have not been modified, and Seller has no
knowledge of any current material default in the performance of the obligations
of any party under the Assumed Contracts. Other than tenants who will vacate
the Property at or prior to Closing, there are no parties in possession of any
portion of the Property as lessees, tenants at sufferance or trespassers.
3.14 Title to Land and Improvements. At the Closing, Seller will convey
to Purchaser fee simple title to the Land and Improvements by general warranty
deeds, free and clear of any and all liens, assessments, unrecorded easements,
security interests and other encumbrances, except for the Permitted Exceptions.
Delivery of the Title Policy shall be deemed to satisfy the obligation of Seller
as to the sufficiency of title required hereunder.
3.15 Hazardous Materials. Except as disclosed on Exhibit 3.15 attached
hereto, the Real Property (including the land, surface water, ground water, and
improvements), is free of "contamination" from (A) any "hazardous waste," any
"hazardous substance," and any "oil, petroleum products, and their by-products,"
as such terms are defined by any federal, state, county or local law, ordinance,
regulation or requirement applicable to any portion of such Real Property, as
the same may be amended from time to time, and including any regulations
promulgated thereunder, and (B) any substance the presence of which on any of
the Real Property is regulated or prohibited by any law (collectively,
"Hazardous Substances"). "Contamination" means the uncontained presence of
Hazardous Substances at such Real Property or arising from such Real Property
that may require remediation or cleanup under any applicable law. Seller has
not
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used any Hazardous Substances on, from or affecting any of the Real Property in
any manner that violates any applicable law, and to the best of Seller's
knowledge, no prior owner or user of any of the Real Property has used such
substances on, from, or affecting any of the Real Property in any manner which
violates any applicable law. There is not now, nor, to the best of Seller's
knowledge, has there ever been on or in any of the Real Property underground
storage tanks or surface impoundments, asbestos-containing materials, or any
material spills of polychlorinated biphenyls, including those used in hydraulic
oils, electric transformers or other equipment. Without limiting in any respect
the generality of the foregoing, there are no actual, alleged or perceived
health issues applicable to any of the Real Property. The copies of any
environmental reports that may have been delivered by Seller to Purchaser, are
complete and accurate copies of the same and Seller has no other environmental
reports, tests or audits in its possession or under its control, and Seller has
no knowledge of any other environmental reports, tests or audits regarding any
of the Real Property existing elsewhere. In addition, Seller has received no
notice from any government authority claiming that any of the Real Property
(including the improvements located thereon) is contaminated by Hazardous
Substances.
3.16 Full Disclosure. This Agreement (including the Exhibits hereto) does
not contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements contained herein not misleading.
There is no fact known to Seller or to the Partners that is not disclosed in
this Agreement that materially adversely affects the accuracy of the
representations and warranties contained in this Agreement or Seller's financial
condition, operations, business, earnings, assets, or liabilities.
3.17 No Brokerage. Other than the obligations owed to the Cypress
Consulting Group, Inc., which Seller agrees to pay, neither Seller nor the
Partners has incurred any obligation or liability, contingent or otherwise, for
brokerage fees, finder's fees, agent's commissions, or the like in connection
with this Agreement or the transactions contemplated hereby.
3.18 Notice of Violations. Seller has received no notice of and, to the
best of Seller's knowledge, there is no violation or alleged violation of any
legal requirement affecting, the Property, including, without limitation, any
violation or alleged violation of any local, state or federal environmental,
zoning, handicap or fire law, ordinance, code, regulation, rule or order, and
specifically including, without limitation, variances or special permits
affecting the Property. Seller has performed all conditions to any permits or
other governmental approvals or licenses with respect to the Property,
including, without limitation, the payment of all development impact or other
fees and developer exactions.
3.19 Condition of Property. The Real Property and Fixtures comply, in all
material respects, with the current Burger King Corporation Repairs and
Maintenance Standards (the "Standards"). In the event Burger King Corporation
requires any modification to the Real Property and/or Fixtures as a result of
their failure to meet the Standards, Seller shall, at its sole cost and expense,
effect such repairs to bring all Real Property and Fixtures into compliance with
the Standards; provided, however, that Seller shall not be required to make any
improvements to the Real Property and/or Fixtures to comply with the Burger King
Corporation's Project Xxxxxxxx standards or any merely cosmetic changes to the
Real Property and/or Fixtures that are not related to the operation,
functionality or safety of same.
ARTICLE IV -- REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller and the Partners, jointly and
severally, as of the date hereof and as of the Closing on the Closing Date each
of the following:
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4.1 Due Organization; Good Standing; Power. Purchaser is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware. Purchaser has full right, power and
authority to enter into this Agreement and to perform its obligations hereunder.
Purchaser is not in breach or violation of, and the execution, delivery and
performance of this Agreement will not result in a breach or violation of, any
of the provisions of Seller's articles of organization or operating agreement
(the "Governing Documents").
4.2 Authorization and Validity of Documents. The execution, delivery and
performance by Purchaser of this Agreement, and the transactions contemplated
hereby and thereby, have been duly and validly authorized by Purchaser. This
Agreement has been duly executed, acknowledged and delivered by Purchaser and is
a legal, valid and binding obligation of Purchaser, enforceable against
Purchaser in accordance with its terms except as such enforceability may be
limited by general principles of equity, bankruptcy, insolvency, moratorium and
similar laws relating to creditors' rights generally.
4.3 No Brokerage. Purchaser has not incurred any obligation or liability,
contingent or otherwise, for brokerage fees, finder's fees, agent's commissions,
or the like in connection with this Agreement or the transactions contemplated
hereby.
4.4 Obligations Assumed. Purchaser covenants that it will pay all
obligations assumed by it under this Agreement.
ARTICLE V -- COVENANTS
5.1 Seller's and Partners' Covenants. Seller and the Partners, jointly
and severally, covenant, promise and agree that from the date hereof and until
the Closing, Seller and the Partners shall, and the Partners shall cause Seller
to perform and comply with each of the following:
5.1.1 Preserve the Property.
5.1.2 Maintain and continue normal and usual maintenance and
repair of the Property.
5.1.3 Cooperate with Purchaser to achieve an orderly transfer of the
Property.
5.1.4 Pay or provide for payment of all sales, use, personal
property, social security, withholding, payroll, unemployment compensation,
income and other taxes, assessments, fees and public charges due and payable by
Seller in respect of its business and the Property through the Closing Date and
any portion thereof applicable to any period prior to the Closing Date unless
otherwise provided herein.
5.1.5 Maintain in effect all insurance policies covering the
Property.
5.1.6 Fully perform and comply with all covenants, promises and
agreements hereunder which are required to be performed or complied with by
Seller and the Partners prior to or at the Closing, and exert their best efforts
to completely satisfy and fulfill all conditions precedent to Seller's and the
Partners' obligations to close hereunder at the Closing on the Closing Date.
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5.1.7 Exert their best efforts to prevent the occurrence of any event
which could result in any of Seller's or the Partners' representations and
warranties contained in this Agreement not being true and correct at or as of
the time immediately after the occurrence of such event, and Seller and the
Partners shall promptly notify Purchaser of the occurrence of any event or the
discovery of any fact which would cause any of their covenants, promises and
agreements to be breached or violated or any of their representations and
warranties to become not true and correct or which could interfere with or
prevent the consummation of the transactions contemplated hereby.
5.1.8 Provide Purchaser and its representatives with access during
normal business hours to all of Seller's Property and Records, provide Purchaser
and its representatives with such financial and operating data and other
information with respect to the Property as Purchaser shall from time to time
reasonably request, and permit Purchaser and its representatives, at Purchaser's
sole expense, to consult with Seller's representatives, officers, employees and
accountants up to the time of Closing and for 120 days thereafter.
5.1.9 Take no action which is or would cause a material violation of
any Laws of any Government or Governmental Agency.
5.1.10 Take, or cause to be taken, all reasonable actions necessary to
permit Purchaser to furnish all information required under the HSR Act and
promptly cooperate with and furnish information to Purchaser in connection with
any such requirements imposed upon Purchaser or its parent in connection with
the transaction as set forth herein. The parties acknowledge and agree that the
filing fees for any filings required under the HSR Act shall be paid by
Purchaser.
5.1.11 Not to further encumber any of the Property or allow any
further encumbrance upon title to the Property, or modify the terms of any
Assumed Service Contract, or enter into any new service contract which would be
binding upon Purchaser or the Property after Closing, without the prior written
consent of Purchaser.
5.1.12 Order from Chicago Title Insurance Company ("Title Company"),
and promptly, but in no event later than April 4, 1997, deliver to Purchaser one
or more ALTA Form B extended coverage title commitments pertaining to each
parcel of the Land, the Ground Leases and the Improvements providing for the
deletion of standard printed exceptions pertaining to survey matters, mechanic's
liens and rights of parties in possession (the "Commitments"), together with
copies of all documents relating to the title exceptions referred to in such
Commitments and a tax certificate issued by the treasurer of each of the
counties in which the Land and/or the Improvements are located. Purchaser shall
bear the expense of obtaining such Commitments.
5.1.13 Deliver to Purchaser on or before April 4, 1997, an as-built
ALTA/ACSM survey (or update to existing survey) for each parcel of the Land, the
Ground Leases and the Improvements prepared by a licensed surveyor (the
"Surveys"). The Surveys shall be sufficient to enable Title Company to update
the Commitments to: (i) delete the standard survey matters, (ii) add any new
title exceptions which are revealed by said Surveys and an inspection of the
Real Property, and (iii) enable Title Company at the Closing to issue, or to
unequivocally agree in writing to issue, an extended owner's policy of title
insurance (with the standard printed exceptions pertaining to survey matters
deleted), and shall be certified to Seller, Purchaser and Title Company.
10
5.1.14 Deliver to Purchaser within 14 business days of the date of
execution of this Agreement all exhibits to be furnished by Purchaser, together
with a letter certifying that all such exhibits have been furnished and that the
information contained therein is true and complete in all material respects.
5.2 Joint Covenants. Seller and the Partners, jointly and severally, on
the one hand, and Purchaser, on the other hand, covenant, promise and agree to
each other as follows: That, on or before April 25, 1997, Purchaser shall notify
Seller in writing of any title exceptions identified in the Commitments and/or
matters reflected in the Surveys of which Purchaser disapproves. Any exception
or matter not disapproved in writing on or before such date shall be deemed
approved by Purchaser, and shall constitute a "Permitted Exception" hereunder.
Within ten (10) business days after Seller's receipt of Purchaser's disapproved
title exceptions and/or Survey matters (but, provided that Seller has had at
least five (5) business days in which to review Purchaser's disapproved
exceptions and/or Survey matters, but in no event later than ten (10) business
days prior to the Closing), Seller shall notify Purchaser in writing of any
disapproved title exceptions and/or Survey matters which Seller is unable or
unwilling to cause to be removed or insured against prior to or at Closing and,
with respect to such exceptions and/or Survey matters, Purchaser then shall
elect, by giving written notice to Seller within five (5) calendar days
thereafter, (x) to terminate this Agreement, or (y) to waive its disapproval of
such exceptions and/or Survey matters, in which case such exceptions and/or
matters shall then be deemed to be Permitted Exceptions.
ARTICLE VI -- OPINIONS OF COUNSEL
6.1 Opinion of Seller's and Partners' Counsel. At the Closing, Seller and
the Partners shall deliver to Purchaser the opinion of their counsel, dated as
of the Closing Date, in substantially the form attached hereto as Exhibit 6.1.
6.2 Opinion of Purchaser's Counsel. At the Closing, Purchaser shall
deliver to Seller and to the Partners the opinion of its counsel, dated as of
the Closing Date, in substantially the form attached hereto as Exhibit 6.2.
ARTICLE VII -- CONDITIONS
7.1 Seller's Conditions to Close. Seller's obligation to close the
transactions contemplated hereby at the Closing shall be subject to the complete
satisfaction and fulfillment of all of the following conditions precedent, any
or all of which may be waived in whole or in part by Seller (but no such waiver
of any such condition precedent shall be or constitute a waiver of any covenant,
promise, agreement, representation or warranty made by Purchaser in this
Agreement):
7.1.1 All representations and warranties made by Purchaser in this
Agreement shall be complete and accurate at and as of the Closing on the Closing
Date. Seller shall have been furnished with a certificate, signed by Purchaser,
and dated the Closing Date to the foregoing effect.
7.1.2 All covenants, promises and agreements made by Purchaser in
this Agreement and all other actions required to be performed or complied with
by Purchaser under this Agreement prior to or at the Closing shall have been
fully performed or complied with by Purchaser. Seller shall have been furnished
with a certificate, signed by Purchaser, and dated the Closing Date to the
foregoing effect.
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7.1.3 Purchaser shall have delivered to the Title Company the items
described in Section 8.1.
7.1.4 Seller shall have received an opinion of counsel for Purchaser
as of the Closing Date, as required by Section 6.2.
7.1.5 Purchaser shall not have received, prior to Closing, any
notification under the HSR Act that seeks to prohibit Purchaser and Seller from
consummating the transaction set forth in this Agreement.
7.1.6 Seller shall have received consent from the lessors under the
Ground Leases to the assignment of each such Ground Leases to Purchaser.
7.2 Purchaser's Conditions to Close. Purchaser's obligation to close the
transactions contemplated hereby at the Closing shall be subject to the complete
satisfaction and fulfillment of all of the following conditions precedent, any
or all of which may be waived in whole or in part by Purchaser (but no such
waiver of any such condition precedent shall be or constitute a waiver of any
covenant, promise, agreement, representation or warranty made by Seller and the
Partners in this Agreement):
7.2.1 All representations and warranties made by Seller and the
Partners in this Agreement shall be complete and accurate at and as of the
Closing on the Closing Date. Purchaser shall have been furnished with a
certificate, signed by the Partners and Seller, and dated the Closing Date, to
the foregoing effect.
7.2.2 All covenants, promises and agreements made by Seller and the
Partners in this Agreement and all other actions required to be performed or
complied with by Seller and the Partners under this Agreement prior to or at the
Closing shall have been fully performed or complied with by Seller and the
Partners. Purchaser shall have been furnished with a certificate, signed by the
Partners and Seller, and dated the Closing Date, to the foregoing effect.
7.2.3 Seller shall have obtained, and delivered to Purchaser, copies
of all consents, approvals or other authorizations which Seller is required to
obtain from, and any filing which Seller is required to make with, any
governmental authority or agency or any other person including, but not limited
to, consents required from Burger King Corporation (the "Burger King Consents")
in connection with the execution, delivery and consummation of this Agreement
and the other documents associated herewith and the consummation of the
transactions contemplated hereby or thereby (collectively, the "Required
Consents"), in form and substance reasonably satisfactory to Purchaser.
7.2.4 Within ten (10) business days after the effective date of this
Agreement, Seller shall have delivered to Purchaser, true, correct and complete
copies of all information in the possession of Seller or Seller's property
manager, or otherwise reasonably subject to Seller's control, pertaining to the
Property which is of the following types or categories: (i) Seller's current
title insurance policies and commitments issued to Seller thereafter; (ii) plans
and specifications (including all "as built" and other architectural plans and
drawings), permits, licenses, approvals and inspection reports pertaining to the
Real Property and Fixtures; (iii) information relating to environmental
conditions at the Property; (iv) the most recent plat of survey of the Real
Property; (v) copies of all Store Leases, Ground Leases, Service Contracts and
any other
12
contracts materially affecting the Property, together with all amendments
thereto; and (vi) a detailed summary of all unresolved legal or administrative
actions, suits or proceedings in any way affecting the Property or any interest
therein. At the xxxx Xxxxxx delivers the Property information to Purchaser,
Seller shall also deliver to Purchaser the certificate of the Partners that the
Property information so delivered constitutes all of the information which
Seller is required to deliver to Purchaser hereunder.
7.2.5 Purchaser shall have received all things required to be
delivered or furnished to Purchaser by Seller and the Partners hereunder prior
to or at the Closing, including the Surveys and the Commitments.
7.2.6 All necessary permits, licenses and approvals required to be
obtained by Purchaser shall have been obtained by Purchaser.
7.2.7 There shall not have occurred any material adverse change in
the Property.
7.2.8 Purchaser shall have received an opinion of counsel for Seller
and the Partners, as of the Closing Date, as required by Section 6.1 hereof.
7.2.9 Purchaser and its representatives shall have completed, to
their complete satisfaction, an investigation and examination of all aspects of
the Property, including the Financial Statements. No employee or representative
of Purchaser will perform on-site due diligence of the Property without Seller's
prior approval, at which time such employee or representative will be
accompanied by Seller or its designee. Purchaser shall have completed its review
of the Property to confirm that the Property conforms in all material respects
to the standards described in Section 3.22 hereof and to confirm the physical
condition of the Property, including the conduct of engineering and all
environmental studies and assessments (the "Inspection") on or before forty-five
(45) days following the execution of this Agreement (the "Inspection Deadline").
The Inspection shall not include title and survey matters, which shall be
governed by Sections 5.1.12 and 5.1.13. If written notice of any unsatisfactory
condition, signed by or on behalf of Purchaser is not received by Seller on or
before the Inspection Deadline, the physical condition of the Property shall be
deemed to be satisfactory to Purchaser. If such notice is received by Seller as
set forth above, and if Purchaser and Seller have not agreed in writing to a
settlement thereof on or before fifteen (15) days following the Inspection
Deadline (the "Resolution Deadline"), this Agreement shall terminate three (3)
business days following the Resolution Deadline; unless, within such three (3)
business day period, Seller receives written notice from Purchaser waiving
objection to any unsatisfactory condition.
7.2.10 Within forty-five (45) days of execution of this Agreement,
Purchaser's auditor shall have (i) reviewed the financial and accounting system
of Seller; (ii) reviewed and confirmed the Financial Statements and results set
forth in the Financial Statements; and (iii) found no material objection to the
financial and accounting system of Seller, or Seller and Purchaser shall have
resolved any objection raised by the auditor and presented to Seller by
Purchaser.
7.2.11 Seller shall have delivered to Purchaser the following
documents:
7.2.11.1 fully executed original counterparts of each Assumed
Contract in Seller's possession;
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7.2.11.2 if available, certificates dated no earlier than thirty
(30) days prior to the Closing Date, from the Secretary of State for the State
of North Carolina as to the good standing of Seller;
7.2.11.3 the Commitments and the Surveys;
7.2.11.4 state, county and, if applicable, municipal, transfer
tax declarations executed by or on behalf of Seller;
7.2.11.5 to the extent in Seller's possession or under Seller's
control, originals (or if originals are not so available, copies) of the plans
and specifications for the Real Property, the Service Contracts, and any other
agreements, licenses or permits used for the operation of the Property and
assigned to Purchaser; and
7.2.11.6 all other documents, instruments and agreements
required to be delivered by Seller to Purchaser pursuant to this Agreement.
7.2.12 The Title Company shall be irrevocably committed to issue, at
the Closing, one or more ALTA owner's policies of title insurance with extended
coverage and endorsements (if any) to insure over any title exceptions and/or
Survey matters pursuant to Section 5.2 hereof (the "Title Policy") insuring
Purchaser's interest in the Land, the Ground Leases and the Improvements, dated
the Closing Date, with liability in the amount of the Purchase Price, subject
only to the Permitted Exceptions.
7.2.13 The Boards of Directors of National Restaurant Enterprises,
Inc. d/b/a AmeriKing, Inc. and the members and managers of Purchaser shall have
approved this Agreement and the transactions contemplated herein.
7.2.14 Purchaser shall have concurrently consummated the transactions
set forth in the F & P Enterprises, Inc. Asset Purchase Agreement, the North
Foods, Inc. Asset Purchase Agreement, and the W & W Investments Limited
Partnership Real Estate Purchase Agreement.
7.2.15 [intentionally omitted]
7.2.16 Subject to the Permitted Exceptions and rights of parties
under the Assumed Service Contracts, Seller shall have delivered possession of
the Property to Purchaser at Closing.
7.2.17 Seller shall have delivered to the Title Company the items
listed in Section 8.1.
7.3 Contemporaneous Transfer. All transfers, assignments, conveyances, and
transactions under this Agreement shall be effected contemporaneously for
present value between and among Seller, the Partners and Purchaser.
ARTICLE VIII - CLOSING DELIVERIES
8.1 Purchaser's Closing Deliveries. At or prior to the Closing, Purchaser
shall deliver or cause to be delivered to the Title Company the following:
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8.1.1 The Purchase Price, together with such other sums as the Title
Company shall require to pay the Closing costs, prorations, reimbursements and
adjustments as set forth herein, in immediately available funds.
8.1.2 A General Assignment executed in duplicate by the Purchaser, in
the form of Exhibit 8.1.2(a) (the "General Assignment"), whereby Purchaser shall
assume the obligations under the Assumed Service Contracts, and an Assignment of
Leases, in the form of Exhibit 8.1.2(b) (the "Assignment of Leases"), whereby
Purchaser shall assume the obligations under the Ground Leases and the Store
Leases.
8.1.3 A certificate from Purchaser stating that all of Purchaser's
conditions precedent to Closing have been satisfied.
8.1.4 Any other documents, instruments or agreements reasonably
necessary or customary in North Carolina or the localities in which any of the
Property is located, or required by the Title Company, to effectuate the
transaction contemplated by this Agreement.
8.2 Seller's Closing Deliveries. At or prior to the Closing, Seller shall
deliver or cause to be delivered to the Title Company the following:
8.2.1 A General Warranty Deed for each parcel of the Land and the
Improvements in the form attached hereto as Exhibit 8.2.1.
8.2.2 A Xxxx of Sale and Assignment in the form attached hereto as
Exhibit 8.2.2.
8.2.3 Two executed counterparts of the General Assignment and the
Assignment of Leases, assigning to Purchaser the Assumed Contracts and any
warranties, guaranties and indemnities relating to the Property, to the extent
such items are assignable, and the Store Leases and Ground Leases, and Consents
to Assignment, Estoppel, and Releases pertaining to the Ground Leases.
8.2.4 Any required easement assignments.
8.2.5 An affidavit from Seller and any other parties required
pursuant to Section 1445 of the Internal Revenue Code and/or regulations
relating thereto stating, under the penalty of perjury (a) that Seller is not a
foreign person; (b) the U.S. Taxpayer identification number of Seller; and (c)
such other information as may be required by regulations enacted by the
Department of Treasury, in connection with Section 1445 of the Internal Revenue
Code.
8.2.6 A certificate from Seller stating that all of Seller's
conditions precedent to Closing have been satisfied.
8.2.7 Any other documents, instruments or agreements reasonably
necessary or customary in North Carolina or the localities in which any of the
Property is located, or required by the Title Company, to effectuate the
transactions contemplated in this Agreement.
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ARTICLE IX -- ESCROW
9.1 Escrow.
9.1.1 Instructions. Not less than ten (10) business days prior to
Closing, Purchaser and Seller each shall deposit a copy of this Agreement
executed by such party (or either of them shall deposit a copy executed by both
Purchaser and Seller) with the Title Company. This Agreement, together with such
further instructions, if any, as the parties shall provide to the Title Company
by written agreement, shall constitute the escrow instructions. If any
requirements relating to the duties or obligations of the Title Company
hereunder are not acceptable to the Title Company, or if the Title Company
requires additional instructions, the parties hereto agree to make such
deletions, substitutions and additions hereto as counsel for Purchaser and
Seller shall mutually approve, which additional instructions shall not
substantially alter the terms of this Agreement unless otherwise expressly
agreed to by Seller and Purchaser.
9.1.2 Deposits into Escrow. Seller shall make its deposits into
escrow in accordance with Section 8.2. Purchaser shall make its deposits into
escrow in accordance with Section 8.1. The Title Company is hereby authorized to
close the escrow only if and when: (i) the Title Company has received all items
to be delivered by Seller and Purchaser pursuant to Article VIII; and (ii) the
Title Company can and will issue the Title Policy.
9.1.3 Close of Escrow. If and when Purchaser and Seller have
deposited into escrow the items required by this Agreement and Title Company can
and will issue the Title Policy concurrently with the Closing, Title Company
shall:
9.1.3.1 Deliver to Purchaser: (i) the General Warranty Deeds by
causing them to be recorded in the records of the clerk and recorder for the
respective Counties in which the Land and Improvements are located; (ii) the
Xxxx of Sale and Assignment; (iii) the affidavit of non-foreign status; (iv) one
copy of the General Assignment; and (v) one copy of the Assignment of Leases.
9.1.3.2 Deliver to Seller: (i) the Purchase Price, after
satisfying the prorations and adjustments to be paid by Seller; (ii) one copy of
the General Assignment and (iii) one copy of the Assignment of Leases.
9.1.3.3 Deliver to Purchaser: any funds deposited by Purchaser,
and any interest earned thereon, in excess of the amount required to be paid by
Purchaser hereunder.
9.1.3.4 Deliver the Title Policy issued by the Title Company to
Purchaser.
9.1.4 Real Estate Reporting Person. The Title Company is hereby
designated the "real estate reporting person" for purposes of Section 6045 of
title 26 of the United States Code and Treasury Regulation 1.6045-4 and any
instructions or settlement statement prepared by the Title Company shall so
provide. Upon the consummation of the transaction contemplated by this
Agreement, the Title Company shall file Form 1099 information return and send
the statement to Seller as required under the aforementioned statute and
regulation
16
ARTICLE X -- INDEMNIFICATION
10.1 Indemnification By Seller And Partners. Seller and the Partners,
jointly and severally, shall defend, indemnify and hold harmless Purchaser, its
managers, members, agents, servants and employees and their respective heirs,
personal and legal representatives, guardians, successors and assigns, from and
against any and all claims, threats, liabilities, taxes, interest, fines,
penalties, suits, actions, proceedings, demands, damages, losses, costs and
expenses (including reasonable attorneys' and experts' fees and court costs) of
every kind and nature arising out of, resulting from, or in connection with the
following:
10.1.1 Any material misrepresentation or breach by Seller or the
Partners of any representation or warranty contained in this Agreement.
10.1.2 Any material nonperformance, failure to comply or breach by
Seller or the Partners of any covenant, promise or agreement of Seller or the
Partners contained in this Agreement.
10.1.3 Any debts, obligations, duties and liabilities of Seller and
the Partners (except those assumed by Purchaser).
10.1.4 The past or future failure of the Seller or the Partners to
comply with any applicable Environmental Laws (as hereinafter defined) or the
presence of Hazardous Materials (as hereinafter defined) in the soil or ground
water on the Real Property at the time of Closing.
10.1.5 Any matter, act, thing or occurrence caused by or resulting
from any act or omission of Seller or the Partners prior to or at the Closing.
For purposes of this Section 10.1, the following terms shall have the
meaning set forth below:
(i) "Environmental Law" shall mean any and all laws, statutes,
ordinances, rules, regulations, judgments, orders, decrees, permits,
concessions, grants, agreements, licenses, or other governmental restrictions or
requirements regulating Hazardous Materials or relating to health, safety, the
environment or the release of Hazardous Materials into the environment, now or
hereafter in effect.
(ii) "Hazardous Materials" shall mean any chemical, substance,
material, object, condition, waste or combination thereof which is or may be
hazardous to human health or safety due to its radioactivity, ignitability,
corrosivity, reactivity, explosiveness, toxicity, carcinogenicity,
infectiousness or other harmful or potentially harmful properties or effects,
including, without limitation, all of those chemicals, substances, materials,
objects, conditions, wastes or combinations thereof which are now or become
listed, defined or regulated in any manner by any Environmental Law.
10.2 Indemnification by Purchaser. Purchaser shall defend, indemnify and
hold harmless Seller, the Partners and their respective heirs, personal and
legal representatives, guardians, successors and assigns, from and against any
and all claims, threats, liabilities, taxes, interest, fines, penalties, suits,
actions, proceedings, demands, damages, losses, costs and expenses (including
reasonable attorneys' and experts' fees and court costs) of every kind and
nature arising out of, resulting from, or in connection with the following:
17
10.2.1 Any material misrepresentation, omission or breach by
Purchaser of any representation or warranty contained in this Agreement.
10.2.2 Any material nonperformance, failure to comply or breach by
Purchaser of any covenant, promise or agreement of Purchaser contained in this
Agreement.
10.3 Defense of Claims. In the event of any claim, threat, liability, tax,
interest, fine, penalty, suit, action, proceeding, demand, damage, loss, cost or
expense with respect to which indemnity is or may be sought hereunder (an
"Indemnity Claim"), the indemnified party shall promptly notify the indemnifying
party in writing of such Indemnity Claim, specifying in reasonable detail the
Indemnity Claim and the circumstances under which it arose. The indemnifying
party may elect to assume the defense of such Indemnity Claim, at its own
expense, by written notice to the indemnified party given within 10 days after
the indemnifying party receives written notice of the Indemnity Claim, and the
indemnifying party shall promptly engage counsel reasonably acceptable to the
indemnified party to direct and conduct such defense; provided, however, that
the indemnified party shall have the right to engage its own counsel, at its own
expense, to participate in such defense. In the event the indemnifying party
does not so elect to assume the defense of such Indemnity Claim in the manner
specified above, or if, in the reasonable opinion of counsel to the indemnified
party, there are defenses available to the indemnified party which are different
from or additional to those available to the indemnifying party or which give
rise to a material conflict between the defense of the indemnified party and of
the indemnifying party, then upon notice to the indemnifying party, the
indemnified party may elect to engage separate counsel to conduct its defense,
at the expense of the indemnifying party.
In the event the indemnifying party assumes the defense of any Indemnity
Claim, it may at any time notify the indemnified party of its intention to
settle, compromise or satisfy such Indemnity Claim and may make such settlement,
compromise or satisfaction (at its own expense) unless within twenty (20) days
after the giving of such written notice the indemnified party shall give written
notice to the indemnifying party of its intention to assume the defense of the
Indemnity Claim, in which event the indemnifying party shall be relieved of its
duty hereunder to indemnify the indemnified party. Unless the indemnified party
shall have given the notice referred to in the preceding sentence, (i) the
indemnified party shall not consent to or make any settlement, compromise or
satisfaction with respect to the Indemnity Claim without the prior written
consent of the indemnifying party, which consent shall not be unreasonably
withheld, and (ii) any settlement, compromise or satisfaction made by the
indemnifying party with respect to such Indemnity Claim shall be deemed to have
been consented to by and shall be binding upon the indemnified party.
10.4 Arbitration. Any dispute arising out of or relating to this Agreement
which occurs after the date of Closing, which has not been resolved by non-
binding means within thirty (30) days, shall be finally settled by arbitration
conducted in accordance with the American Arbitration Association Commercial
Arbitration Rules by a sole arbitrator selected by the parties. In the event the
parties cannot agree upon an arbitrator, each party shall select an arbitrator
and the two arbitrators so selected shall select the arbitrator to hear the
dispute. The place for arbitration shall be Chicago, Illinois.
ARTICLE XI -- MISCELLANEOUS
11.1 Survival of Representations, Warranties and Agreements. All of the
representations, warranties, covenants, promises and agreements of the parties
contained in this Agreement (or in any
18
document delivered or to be delivered pursuant to this Agreement or at or in
connection with the Closing) shall survive the execution, acknowledgment and
delivery of this Agreement and the consummation of the transactions contemplated
hereby for a period of five (5) years from the date of Closing.
11.2 Post-Closing Obligation. Within fifteen (15) days following the
Closing Date, Seller shall pay all wages, bonuses, commissions and other
benefits and sums (and all required taxes, insurance, social security and
withholding thereon), including all accrued vacation, accrued sick leave,
accrued benefits and accrued payments (and pro rata accruals for a portion of a
year) due to Seller's employees for all periods prior to and through the Closing
Date.
11.3 Notices. All notices, requests, demands, consents, and other
communications which are required or may be given under this Agreement
(collectively, the "Notices") shall be in writing and shall be given either (a)
by personal delivery with a receipted copy of such delivery, (b) by certified or
registered United States mail, return receipt requested, postage prepaid, or (c)
by facsimile transmission with an original mailed by first class mail, postage
prepaid, to the following addresses:
(i) If to Seller, to:
T & B Leasing
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxx X. Xxxxxxx
Xxxxxx & Xxxxxxx, L.L.P.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
(ii) If to the Partners, to:
Xxxxxx Xxxxxxxx
Xxxxxxx Xxxxxxxx
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Fax: (000) 000-0000
19
with a copy to:
Xxxx X. Xxxxxxx
Xxxxxx & Xxxxxxx, L.L.P.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
(iii) If to Purchaser:
Xxxxxxxx X. Xxxx, Manager
Castle Properties, L.L.C.
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Telefax No.: (000) 000-0000
with copies to:
A. Xxxxxxx Xxxxxx
The Jordan Company
0 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Telefax No.: (000) 000-0000
and
Xxxxxx X. Xxxxxxx, Esq.
Xxxxxx Xxxxxxxx Xxxxxx & X'Xxxxxxx, P.C.
0000 00xx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Telefax No.: (000) 000-0000
or to such other address of which written notice in accordance with this Section
11.3 shall have been provided to the other parties. Notices may only be given in
the manner hereinabove described in this Section 11.3 and shall be deemed
received three (3) days after given in such manner; provided however, that any
notice sent by facsimile shall be deemed to have been given as of the date of
the transmission.
11.4 Entire Agreement. This Agreement (including the Exhibits hereto,
which constitute a part of this Agreement) constitutes the full, entire and
integrated agreement between the parties hereto with respect to the subject
matter hereof, and supersedes all prior negotiations, correspondence,
understandings and agreements among the parties hereto respecting the subject
matter hereof.
11.5 Assignability. This Agreement shall not be assignable by any party
hereto without the prior written consent of the other parties hereto; provided,
however, that Purchaser may assign this Agreement to another subsidiary of
AmeriKing Corporation.
20
11.6 Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
personal and legal representatives, guardians, successors and permitted assigns.
Nothing in this Agreement, express or implied, is intended to confer upon any
other person any rights, remedies, obligations, or liabilities.
11.7 Severability. Any provision of this Agreement which is held by a
court of competent jurisdiction to be prohibited or unenforceable only shall be
ineffective only to the extent of such prohibition or unenforceability, without
invalidating or rendering unenforceable the remaining provisions of this
Agreement.
11.8 Amendment; Waiver. No provision of this Agreement may be amended,
waived or otherwise modified without the prior written consent of all of the
parties hereto. No action taken pursuant to this Agreement, including any
investigation by or on behalf of any party shall be deemed to constitute a
waiver by the party taking such action of compliance with any representation,
warranty, covenant or agreement herein contained. The waiver by any party hereto
of a breach of any provision or condition contained in this Agreement shall not
operate or be construed as a waiver of any subsequent breach or of any other
conditions hereof.
11.9 Recording. This Agreement shall not be recorded by either party in
the Office of the clerk and recorder of the county in which any of the Real
Property is located or in any other office or place of public record and, if
Purchaser shall record this Agreement or cause or permit same to be recorded,
Seller may, at its option, elect to treat such act as a breach of this
Agreement.
11.10 Confidentiality. Each party agrees that, except as otherwise set
forth in this Agreement or provided by law or unless compelled by an order of a
court, it shall keep the contents of this Agreement and any information related
to the transaction contemplated hereby confidential and further agrees to
refrain from generating or participating in any publicity statement, press
release, or other public notice regarding this transaction without the prior
written consent of the other party unless required under applicable law or by a
court order. The provisions of this Section 11.10 shall survive the Closing or
any termination of this Agreement and shall not be merged into any instrument or
conveyance delivered at the Closing.
11.11 Section Headings. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
11.12 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
11.13 Applicable Law; Jurisdiction and Venue; Service of Process. This
Agreement shall be governed by, construed, interpreted and enforced in
accordance with the laws of the State of North Carolina.
11.14 Remedies. The parties hereto acknowledge that in the event of a
breach of this Agreement by Seller, any claim for monetary damages hereunder may
not constitute an adequate remedy, and that it may therefore be necessary for
the protection of the Purchaser to carry out the terms of this Agreement to
apply for the specific performance of the provisions hereof. It is accordingly
hereby agreed by Seller that no objection to the form of the action or the
relief prayed for in any proceeding for specific performance of this
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Agreement shall be raised by Seller, the Partners or any of their affiliates, in
order that such relief may be expeditiously obtained by Purchaser.
11.15 Further Assurances. Seller and the Partners jointly and severally
agree to execute, acknowledge and deliver, after the date hereof, without
additional consideration, such further assurances, instruments and documents,
and to take such further actions, as Purchaser may reasonably request in order
to fulfill the intent of this Agreement and the transactions contemplated
hereby.
11.16 Use of Genders. Whenever used in this Agreement, the singular shall
include the plural and vice versa, and the use of any gender shall include all
genders and the neuter.
11.17 Negotiations with Other Persons. Until the earlier of the Closing
or the termination of this Agreement as provided herein, neither Seller nor the
Partners shall initiate, encourage the initiation by others, or participate in
any discussion or negotiations with any other person or entity relating to the
sale of any or all of the Property, the business of Seller or any securities of
Seller. From the date of this Agreement and until after the Closing and the
consummation of the transactions contemplated by this Agreement, the Partners
shall not offer for sale, sell or otherwise transfer (with or without
consideration) any securities of Seller owned of record or beneficially by him.
11.18 Tax Deferred Exchange. Seller shall have the right and option to
engage in a tax-deferred exchange of the Land pursuant to Section 1031 of the
Internal Revenue Code of 1986, as amended, and Purchaser shall cooperate with
Seller to the extent necessary to accomplish such an exchange, so long as
Purchaser's rights hereunder are not prejudiced in any manner, as determined by
Purchaser in its sole discretion. The representations and warranties made by
Seller and the Partners to Purchaser in this Agreement shall apply to any
intermediary which becomes a seller of the Land by virtue of such a tax-deferred
exchange.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement, with the intention of making it a valid and binding instrument, on
the date first above written.
Seller:
ATTEST: T & B LEASING
_________________________________ ______________________________________
By:___________________________________
Its: General Partner
WITNESS: Partners:
_________________________________ ______________________________________
Xxxxxx Xxxxxxxx
______________________________________
Xxxxxxx Xxxxxxxx
Purchaser:
ATTEST: CASTLE PROPERTIES, L.L.C.
_________________________________ By:___________________________________
Xxxx Xxxxxx, Manager Xxxxxxxx X. Xxxx, Manager
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EXHIBIT LIST
1.1 Legal Descriptions of Land and Improvements
1.1.3 Ground Leases
1.1.5 Fixtures
1.1.6 Assumed Service Contracts
1.2 Allocation of Purchase Price
1.4 Proration Adjustment Letter
3.2 Breaches or Violations of Governing Documents
3.4 Disclosure of Exceptions regarding Authority
3.7 Financial Statements
Unaudited Balance Sheets as of December 31, 1994
Unaudited Balance Sheets as of December 31, 1995
Unaudited Balance Sheets as of December 31, 1996
Operating Statements for January 1, 1994 through December 31, 1994
Operating Statements for January 1, 1995 through December 31, 1995
Operating Statements for January 1, 1996 through December 31, 1996
3.11.3 Payment of Indebtedness and Taxes
3.12 Adverse Conditions
3.15 Hazardous Materials
6.1 Opinion of Seller's and Partners' Counsel
6.2 Opinion of Purchaser's Counsel
8.1.2(a) General Assignment
8.1.2(b) Assignment of Leases
8.2.1 Form of General Warranty Deed
8.2.2 Form of Xxxx of Sale and Assignment
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