EXHIBIT 10.1
STOCK PURCHASE AGREEMENT WITH JOCKS & JILLS XXXXX, INC. AND DIVINE EVENTS, INC.
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STOCK PURCHASE AGREEMENT
THIS AGREEMENT entered into on the 18th day of October, 1996 (the
"Agreement Date"), by and among Xxxxxx Xxxxxxx (the "Seller"), Jocks & Jills
Xxxxx, Inc. ("Xxxxx"), Divine Events, Inc. ("Divine"), and Classic Restaurants
International, Inc. ("Purchaser").
WHEREAS, the Seller owns 67.5% of the issued and outstanding common
stock of Xxxxx (the "Xxxxx Stock") and 60.75% of the issued and outstanding
common stock of Divine (the "Divine Stock" and with the Xxxxx Stock, the
"Stock"); and
WHEREAS, the Seller has agreed to sell all of the Stock to the
Purchaser, and the Purchaser has agreed to purchase all of the Stock from the
Seller, on the terms and conditions set forth herein; and
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is acknowledged by the parties, and in consideration of the
mutual covenants set forth herein, the parties hereby agree as follows:
1. PURCHASE AND SALE OF STOCK. Subject to the terms and conditions set
forth in this Agreement, Seller agrees to sell, convey, transfer, assign and
deliver to Purchaser, and Purchaser agrees to purchase from Seller, all of the
Stock.
2. PURCHASE PRICE. The purchase price for the Stock shall be $1,800,000
(the "Purchase Price"). The Purchaser shall pay the Purchase Price at Closing in
cash.
3. XXXXXXX MONEY DEPOSIT. Within two days of execution of this
Agreement, the Purchaser shall deposit $50,000 (the "Xxxxxxx Deposit") in with
the Seller. In addition, each time the Purchaser requests a thirty day extension
of the Closing Date pursuant to Paragraph 7 herein, the Purchaser shall
simultaneously pay to the Seller an additional $10,000 as an additional Xxxxxxx
Deposit. In the event Closing occurs, the Xxxxxxx Deposit shall be applied to
the Purchase Price. In the event Closing does not occur, then the Xxxxxxx
Deposit shall be disposed of pursuant to Paragraph 11 herein.
4. BROKER'S FEE. The parties acknowledge that National Restaurant
Brokers, Inc. ("Broker") has acted as a broker in this transaction and will be
due a brokerage fee in the event Closing occurs under this Agreement. The Seller
shall be responsible for $112,500 of the Broker's fee, and the Purchaser shall
be responsible for any amount over $112,500. Other than Broker, there are no
brokers involved in this transaction. Seller represents to Purchase that, other
than the Broker, neither Seller, Xxxxx nor Divine have engaged any broker or
agent in regard hereto or to the sale and purchase of the Property or the Stock,
and Seller hereby agrees to indemnify Purchaser and hold Purchaser harmless
against all liability, loss, cost, damage and expense (including, without
limitation, attorneys' fees and cost of litigation) Purchaser shall ever suffer
or incur because of any claim by any broker or agent claiming by, through or
under Seller, Xxxxx or Divine, whether or not meritorious, for any fee,
commission or other compensation with respect hereto or to the sale and purchase
of the Property or the Stock provided herein.Purchaser represents to Seller that
it has not engaged any broker or agent in regard hereto or to the sale and
purchase of the Property or the Stock, and Purchaser hereby agrees to indemnify
Seller and hold Seller harmless against all liability, loss, cost, damage and
expense (including, without limitation, attorneys' fees and cost of litigation)
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Seller shall ever suffer or incur because of any claim by any broker or agent
claiming by, through or under Purchaser, whether or not meritorious, for any
fee, commission or other compensation with respect hereto or to the sale and
purchase of the Property or the Stock provided herein.
5. CLOSING COSTS. The Seller shall pay all normal and customary closing
costs, including the fees of Broker and all recording costs and transfer taxes,
if applicable. Each party shall bear their own legal, accounting and auditing
costs, and in particular any costs incurred by the Purchaser to obtain an audit
of the financial statements of Xxxxx or Divine, as well as any other costs
incurred by the Purchaser for due diligence, shall be borne exclusively by the
Purchaser.
6. DUE DILIGENCE BY PURCHASER. Promptly after execution of this
Agreement, the Seller, Xxxxx and Divine shall provide the Purchaser, and its
engineers, accountants, attorneys, agents and representatives with:
a) unaudited financial statements for Xxxxx and Divine (which include a
balance sheet, statement of income and expenses, and statement of cash
flows) for the years ended December 31, 1995, and December 31, 1994,
and for the six months ended June 30, 1996;
b) copies of any liens, claims, encumbrances or lease agreements
affecting the assets of Xxxxx or Divine;
c) access to all corporate books and records of Xxxxx and Divine on
reasonable notice during normal business hours;
d) access to all other books and records of Xxxxx and Divine on
reasonable notice during normal business hours;
e) access to inspect all physical locations at which Xxxxx and Divine
conduct business on reasonable notice during normal business hours.
The Purchaser shall have the right until November 30, 1996 to terminate
this Agreement in the event its due diligence indicates that the Seller has
materially breached any of the representations and warranties contained in
paragraph 9 of this Agreement.
7. CLOSING DATE. The transactions contemplated by this Agreement shall
occur on or before November 30, 1996 (the "Closing Date"), in the offices of
Xxxxxxx & Van Gelderen, 0000 Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000
(hereinafter, the "Closing"), unless another date and time is subsequently
agreed to by the parties; provided, however, that the Purchaser shall have the
right to extend the Closing for three thirty (30) day periods upon written
notice to Seller and payment of $10,000 as an additional Xxxxxxx Deposit
pursuant to Paragraph 3 herein.
8. UNDERTAKINGS BY XXXXX AND DIVINE PRIOR TO THE CLOSING DATE. Between
the Agreement Date and the Closing Date, Xxxxx and Divine shall not and the
Seller shall not cause Xxxxx and Divine to:
a) transfer any assets, incur any obligation or engage in any
transaction other than in the ordinary course of business;
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b) change the compensation or benefits of, or pay any bonus to, any
officer, director or employee other than in the normal course of
business;
c) terminate any registration or license, or allow any such
registration or license to lapse;
d) declare or pay any dividend, or redeem any capital stock; provided
that Xxxxx and Divine may declare one or more dividends provided their
combined net worth is not less than $1,323,467.01 as of the Closing
Date.
9. REPRESENTATIONS AND WARRANTIES OF THE SELLER, XXXXX AND DIVINE. The
Seller, Xxxxx and Divine warrant and represent, to the best of their knowledge
after due investigation, as of the Agreement Date and the Closing Date, that:
a) Xxxxx is a validly formed corporation in good standing under the
laws of the State of Georgia, and all franchise taxes and fees required
to maintain it in good standing have been paid;
b) Divine is a validly formed corporation in good standing under the
laws of the State of Georgia, and all franchise taxes and fees required
to maintain it in good standing have been paid;
c) the Seller, Xxxxx and Divine are authorized to execute, deliver and
perform this Agreement according to its terms;
d) the Xxxxx Stock constitutes 67.5% of the issued and outstanding
capital stock of Xxxxx;
e) the Divine Stock constitutes 60.75% of the issued and outstanding
capital stock of Divine;
f) the Stock is not encumbered by any lien, claim or encumbrance, and
will be sold, assigned, conveyed and transferred to the Purchaser free
of any lien, claim, debt, or obligation whatsoever;
g) Xxxxx and Divine are operating in full compliance with the laws,
rules and regulations of any and all regulatory agencies having
jurisdiction over Xxxxx and Divine;
h) there is no claim, judgment, complaint or lawsuit pending or
threatened against Xxxxx, Divine or the Seller, except as disclosed on
Exhibit "A" attached hereto;
i) Xxxxx and Divine are not in default or past due with respect to an
obligation except as disclosed on Exhibit "A" attached or local agency;
j) the Seller, Xxxxx or Divine have not filed bankruptcy under Title
11. U.S. Code. or any other debt relief law, have not had a receiver
appointed, have not made an assignment for the benefit of creditors,
and have not been found or adjudicated insolvent by any court or
tribunal;
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k) the financial statements provided to the Purchaser pursuant to
Paragraph 6(a) of this Agreement are prepared according to GAAP and
accurately reflect the assets, liabilities and financial condition of
Xxxxx and Divine as of the date(s) thereof.
10. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants as of the date of this Agreement, and as the Closing
Date, the following:
a) the Purchaser is a validly formed corporation in good standing under
the laws of the State of Colorado, and all franchise taxes and fees
required to maintain the Purchaser in good standing have been paid;
b) the Purchaser is authorized to execute, deliver and perform this
Agreement according to its terms.
11. TERMINATION OF AGREEMENT. In the event of a termination of this
Agreement due to the exercise by Purchaser of its right to terminate the
Agreement in paragraph 6 herein, then neither party shall have any liability to
the other, including particularly for any incidental or consequential damages
which each may have incurred or suffer as consequence of the party's entry into
this Agreement, and the Xxxxxxx Deposit shall be promptly refunded to the
Purchaser in full. In view of the difficulty of determining Seller's damages in
the event of default by Purchaser if Closing does not occur because of
Purchaser's default (as distinguished from the exercise by Purchaser of an
express right to cancel or terminate as provided in paragraph 6 herein or the
failure of any of the conditions to Closing to be satisfied or waived), Seller
shall be entitled to retain the Xxxxxxx Deposit as full and complete liquidated
damages, and not as a penalty and, thereupon, no party shall have any further
obligation or liability hereunder nor any other remedy at law or in equity. If
the Closing does not occur on account of Seller's default by (i) failing to
provide any documents reasonably necessary to effectuate the transactions
contemplated by this Agreement, (ii) voluntarily encumbering or causing title
defects to occur after the Agreement Date and failing to remove or satisfy such
encumbrances or title defects on or before Closing, or (iii) breaching any
warranty or representation set forth herein in a material respect, then the
Xxxxxxx Deposit shall be promptly refunded to the Purchaser and the Purchaser
shall be entitled to pursue any and all remedies afforded by law or in equity,
including but not limited to: (1) the right to have this Agreement specifically
enforced against Seller, and (2) the right to xxx Seller for damages resulting
to Purchaser.
12. MISCELLANEOUS PROVISIONS.
a) NO WAIVERS. No failure or delay on the part of any party in
exercising any right, power, privilege or remedy arising hereunder
shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power, privilege or remedy preclude any other or
future exercise thereof or the exercise of any other right, power,
privilege or remedy. No notice to or demand on any party in any case
shall entitle it to any other or further notice or demand in similar or
other circumstances.
b) MULTIPLE COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall constitute an original.
c) HEADINGS; INTERPRETATION. Section headings have been inserted in
this Agreement as a matter of convenience and for reference only and it
is agreed that such section headings are
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not a part of this Agreement and shall not be used in the
interpretation of any provision of this Agreement. Whenever used
herein, the singular shall include the plural, the plural shall include
the singular.
d) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall incur to the benefit of the parties hereto and their respective
successors and assigns, except as otherwise provided herein. Except as
provided in the preceding sentence, there are no third party
beneficiaries.
e) GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed by and interpreted in accordance
with the laws of Georgia.
f) MODIFICATIONS. No modification, amendment or waiver of any provision
of this Agreement, nor any consent to any departure by any party from
the terms hereof, shall be effective unless the same be in writing and
signed by all parties hereto.
g) ENTIRE AGREEMENT. This Agreement constitutes the entire and complete
agreement between the parties hereto and all prior agreements,
understandings, obligations or statements by and between the parties
concerning the subject matter hereof will be merged into and be
superseded by this Agreement and shall be of no further force and
effect. There are no third-party beneficiaries to this Agreement,
either intended or unintended.
h) SURVIVAL. This Agreement and the representations, warranties and
covenants contained herein shall survive consununation of the
transactions herein contemplated for a period of four (4) years.
i) ATTORNEY'S FEES. In the event any party hereto files a lawsuit in
connection with this Agreement, then the party which prevails in such
action shall be entitled to recover, in addition to all other remedies
and damages, reasonable attorney's fees and costs of court incurred in
such lawsuit.
j) NOTICES. All notices required or permitted hereunder, and under any
instrument delivered pursuant hereto, shall be given in writing, and
shall be deemed to have been given and received upon the earlier to
occur of: (a) the actual receipt of any such notice by the intended
recipient; and (b) the third business day following deposit of any such
notice enclosed in a wrapper with postage prepaid, properly addressed
to the intended recipient at its address set forth below, as a
certified item, return receipt requested, in an official depository of
and under the care and custody of the United States Postal Service. The
parties' address for notice shall be as follows:
If to the Purchaser:
Xxxxx Xxxxxx Xxxx
Classic Restaurants International, Inc.
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
(000) 000-0000
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and
Xxxxxx X. Xxxxxxx
Xxxxxxx & Van Gelderen
0000 Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
(000) 000-0000
If to Seller, Xxxxx or Divine:
Xxxxxx X. Xxxxxxx
Xxxxxxx & Associates, P.C.
0000 Xxxxxxxxx Xxxxxx, X.X.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
(000) 000-0000
Any party hereto may change its address for notice set forth herein by
giving the other parties at least 10 days advance written notice of such change
of address.
IN WITNESS WHEREOF, the parties have set their hands and seals the date
set forth above.
/s/Xxxxxx X. Xxxxxxx
By: Xxxxxx Xxxxxxx, Individually
JOCKS & JILLS XXXXX, INC., a Georgia
corporation
/s/Xxxxxx X. Xxxxxxx
By: Xxxxxx X. Xxxxxxx
Its: President
DIVINE EVENTS, INC., a Georgia corporation
/s/Xxxxxx X. Xxxxxxx
By: Xxxxxx X. Xxxxxxx
Its: President
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CLASSIC RESTAURANTS INTERNATIONAL
INC., a Colorado corporation
/s/Xxxxx Xxxxxx Xxxx
By: Xxxxx Xxxxxx Xxxx, Chairman
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