Exhibit 2.1
ASSET PURCHASE AGREEMENT
between
QUICK STOP FOOD MART, INC.
and
THE PANTRY, INC.
Dated as of June 5, 1998
*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
Table of Contents
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ARTICLE I - DEFINITIONS...........................................................................................1
1.1 Defined Terms..............................................................................................1
1.2 Additional Definitions.....................................................................................7
ARTICLE II PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF LIABILITIES; PURCHASE PRICE..............................7
2.1 Purchase and Sale of Assets................................................................................7
2.2 Excluded Assets............................................................................................8
2.3 Assumption of Liabilities..................................................................................9
2.4 Excluded Liabilities.......................................................................................9
2.5 Purchase Price.............................................................................................9
2.6 **.........................................................................................................9
2.7 **.........................................................................................................9
2.8 **........................................................................................................10
2.9 Employees.................................................................................................10
ARTICLE III THE CLOSING.........................................................................................10
3.1 Time and Place of Closing.................................................................................10
3.2 Instruments of Transfer...................................................................................10
3.3 Further Assurances........................................................................................11
3.4 Transfer Taxes............................................................................................11
ARTICLE IV TERMINATION...........................................................................................11
4.1 Termination...............................................................................................11
4.2 Effect of Termination.....................................................................................11
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF THE SELLER.........................................................12
5.1 Organization and Good Standing............................................................................12
5.2 Power and Authority.......................................................................................12
5.3 No Violation..............................................................................................12
5.4 No Actions................................................................................................12
5.5 Approvals.................................................................................................13
5.6 Compliance with Laws and Orders...........................................................................13
5.7 Financial Statements......................................................................................13
5.8 Absence of Certain Changes or Events......................................................................13
5.9 Title to Transferred Assets...............................................................................14
5.10 Inventory................................................................................................14
5.11 Real Property............................................................................................14
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5.12 Third Party Leases, Leases of Seller Ground Lease Property
and Affiliate Ground Lease Property......................................................................15
5.13 Insurance................................................................................................16
5.14 Contracts................................................................................................16
5.15 Employment Law Matters...................................................................................16
5.16 Environmental Matters....................................................................................16
5.17 Property of Others.......................................................................................17
5.18 Equipment, Etc...........................................................................................17
5.19 Condition of Tangible Assets.............................................................................17
5.20 Sufficiency of Assets....................................................................................17
5.21 Tax Matters..............................................................................................17
5.22 Finders or Brokers.......................................................................................18
5.23 Disclosure of Material Facts.............................................................................18
5.24 Certain Interests; Affiliate Transactions................................................................18
5.25 Employee Benefit Plans...................................................................................18
ARTICLE VI - REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.....................................................18
6.1 Organization and Good Standing............................................................................19
6.2 Power and Authority.......................................................................................19
6.3 No Violation..............................................................................................19
6.4 No Actions................................................................................................19
6.5 Approvals.................................................................................................19
6.6 Disclosure of Material Facts..............................................................................19
6.7 Finders or Brokers........................................................................................20
ARTICLE VII - CERTAIN OBLIGATIONS OF THE SELLER PRIOR TO
THE CLOSING OR EARLIER TERMINATION OF THIS AGREEMENT.............................................................20
7.1 Conduct of Business.......................................................................................20
7.2 Restricted Activities and Transactions....................................................................20
7.3 Cooperation...............................................................................................21
7.4 Employee Benefit Plans....................................................................................21
7.5 No Negotiations...........................................................................................21
7.6 Access to the Business....................................................................................21
7.7 Disclosure Regarding the Seller...........................................................................22
7.8 Confidentiality...........................................................................................22
ARTICLE VIII - CERTAIN OBLIGATIONS OF THE PURCHASER PRIOR TO
THE CLOSING OR EARLIER TERMINATION OF THIS AGREEMENT.............................................................23
8.1 Cooperation...............................................................................................23
8.2 Disclosure Regarding the Purchaser........................................................................23
8.3 Confidentiality...........................................................................................23
8.4 Restricted Activities.....................................................................................23
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ARTICLE IX CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF THE PURCHASER.................................................................................................23
9.1 Representations and Warranties True.......................................................................23
9.2 Performance...............................................................................................24
9.3 No Adverse Changes........................................................................................24
9.4 Approvals.................................................................................................24
9.5 Estoppel Certificates.....................................................................................24
9.6 Subordination, Non-Disturbance and Attornment Agreements..................................................25
9.7 Deliveries................................................................................................25
9.8 Proceedings...............................................................................................26
9.9 Absence of Litigation.....................................................................................26
9.10 [Intentionally Omitted]..................................................................................26
9.11 Environmental Matters....................................................................................26
ARTICLE X - CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF THE SELLER....................................................................................................26
10.1 Representations and Warranties True......................................................................26
10.2 Performance..............................................................................................26
10.3 Approvals................................................................................................27
10.4 Deliveries...............................................................................................27
10.5 Proceedings..............................................................................................27
10.6 Absence of Litigation....................................................................................28
ARTICLE XI - CERTAIN POST-CLOSING COVENANTS......................................................................28
11.1 Confidentiality..........................................................................................28
11.2 Noncompetition...........................................................................................28
11.3 Responsibility for Environmental Matters.................................................................29
11.4 Specific Performance; Injunctive Relief..................................................................30
11.5 Change of Seller's Name..................................................................................30
11.6 Jacksonville Store..................................................................................... 31
ARTICLE XII - SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION........................................31
12.1 Survival of Representations and Warranties...............................................................31
12.2 Indemnification..........................................................................................31
12.3 Notice and Payment of Claims.............................................................................31
12.4 Limitation on Indemnity..................................................................................32
12.5 Mitigation of Damages....................................................................................33
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ARTICLE XIII - MISCELLANEOUS.....................................................................................33
13.1 Fees and Expenses........................................................................................33
13.2 Notices..................................................................................................33
13.3 Amendment; Waiver........................................................................................34
13.4 Assignment...............................................................................................35
13.5 Governing Law............................................................................................35
13.6 Severability.............................................................................................35
13.7 No Third Party Beneficiaries.............................................................................35
13.8 Public Announcements.....................................................................................35
13.9 Singular and Plural Forms................................................................................35
13.10 References..............................................................................................35
13.11 Headings................................................................................................35
13.12 Entire Agreement........................................................................................35
13.13 Counterparts............................................................................................36
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EXHIBITS
Exhibit A.........Form of Seller Leases and Affiliate Leases
Exhibit B.........Form of Third Party Lease Assignments
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SCHEDULES
1.1 Stores
2.1(e) Change Fund by Store
2.1(f) Contracts
2.1(j) Vehicles
2.7 Allocation of Purchase Price
2.8(c) Myrtle Beach Seasonal Bonus Plan
3.2 Terms for Seller and Affiliate Leases
5.4 Actions
5.5 Approvals
5.6 Compliance with Laws Generally
5.7 Financial Statements
5.8 Certain Changes
5.9 Exceptions to Title
5.11(a) Seller Fee Property
5.11(b) Affiliate Fee Property
5.11(c) Third Party Real Property
5.11(e) Options or Rights of First Refusal Relating to Real Property
5.11(g) Condemnation Proceedings
5.11(i) Flood Hazard Area
5.11(j) Tax Lots
5.12 Third Party Leases
5.14 Contract Assignments Requiring Approval
5.15 Employment Matters
5.16 Underground Storage Tanks
5.18(a) Seller Equipment
5.18(b) Third Party Equipment
5.20 Exceptions to Sufficiency of Assets
5.24 Affiliate Transactions
5.25 Employee Benefit Plans
9.4 Approval Exceptions
9.6 Mortgagees and Their Interests
11.3(a) Identified Preclosing Releases
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ASSET PURCHASE AGREEMENT
Asset Purchase Agreement (the "Agreement"), dated as of the 5th day of
June, 1998, by and among QUICK STOP FOOD MART, INC., a North Carolina
corporation ("Seller"), and THE PANTRY, INC., a Delaware corporation (the
"Purchaser").
WITNESSETH:
WHEREAS, the Seller operates seventy-five (75) convenience stores in
North Carolina and South Carolina and owns gasoline equipment and provides
gasoline products to three (3) subleased locations; and
WHEREAS, the Seller desires to transfer, sell, convey, assign and
deliver (collectively, "Transfer") to the Purchaser, and the Purchaser desires
to acquire and accept from the Seller, certain assets of Seller relating to
Seller's convenience store business, upon the terms and conditions hereinafter
set forth.
NOW, THEREFORE, for and in consideration of the premises, mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms. The following terms, as used in this Agreement,
shall have the following meanings:
"Action" shall mean any action, claim, proceeding, suit or
investigation, or any appeal therefrom.
"Accrued Vacation Pay" shall mean all accrued vacation pay as
of the Closing Date of each of Seller's employees as provided in Seller's
related Employee Benefit Plan.
"Affiliate" shall mean, with respect to any Person, any Person
which, directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such Person. Without limiting
the foregoing definition, the term "Affiliate," as it relates to Seller, shall
include the following persons: Xxxxxx X. XxXxxxxx, Xxxxxxx XxXxxxxx, Xxxxxxx
Xxxxx, Xxxxxx Xxxx, and XxXxxxxx and XxXxxxxx Investments, Inc.
"Affiliate Fee Property" shall mean the real property owned by
an Affiliate and more particularly described on Schedule 5.11(b) hereto.
"Affiliate Leases" shall mean leases for each of the Store
properties identified under the heading Affiliate Leases on Schedule 3.2.
"Agreement" shall mean this Asset Purchase Agreement and shall
include all of the Schedules and Exhibits attached hereto.
"Approval" shall mean any approval, authorization, clearance,
expiration of waiting period, consent, license, franchise, order or permit of or
by, or filing with, any Governmental Authority or other Person.
"Assumed Liabilities" shall have the meaning ascribed to such
term in Section 2.3 hereof.
"Audit" shall mean a physical audit or count of all of the
Inventory to be conducted jointly by Seller and Purchaser at each Store on the
Closing Date and on the two (2) days prior thereto, commencing at 7:00 a.m..
"Business" shall mean the business of Seller's seventy-five
(75) convenience stores and the three (3) locations which are the subject of the
Subleases and to which Seller provides Petroleum Inventory, in North Carolina
and South Carolina, identified on Schedule 1.1.
"Business Day" or "business day" shall mean any day that is
not a Saturday, Sunday, or legal or banking holiday in North Carolina.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act, 42 U.S.C. ss. 9601 et seq., as amended,
including any rules and regulations promulgated thereunder or in connection
therewith.
"Change Fund" shall mean the normal change fund for each
Store, as set forth on Schedule 2.1(e).
"Closing" shall mean the consummation of the transactions
contemplated by this Agreement, effective as of 7:00 a.m. on Thursday, June 25,
1998.
"Closing Date" shall mean June 25, 1998 or as soon thereafter
as the conditions to Closing described in Articles IX and X hereof shall have
been fully satisfied or waived by the appropriate party or parties hereto, but
not later than July 31, 1998.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, and shall include all of the rules and regulations promulgated
thereunder.
"Condition" shall mean, collectively, the business,
properties, assets, operations, results of operations and condition (financial
or otherwise).
"Contracts" shall mean the contracts and agreements of the
Seller relating to the Business and which will be assigned to and assumed by the
Purchaser, as identified on Schedule 2.1(f).
"Cost" shall mean Seller's laid-in cost of Petroleum
Inventory, **% of retail ********************, **% of retail **** and **% of
retail for all other Merchandise Inventory, all as determined from Seller's
books and records and the Audit, subject to confirmation upon completion of
Purchaser's review, as the parties may agree.
"Damages" shall mean any fine, penalty, claim, loss,
deficiency, Liability, cost or expense (including, without limitation,
reasonable attorneys' and accountants' fees, costs and
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*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
expenses) or environmental assessment, monitoring or remediation expense,
diminution in property value, or damage of any kind or nature whatsoever.
"DHEC" shall have the meaning ascribed to such term in Section
2.2(g).
"Employee Benefit Plan" shall mean any employee benefit plan,
arrangement, policy or commitment (including any employee benefit plan within
the meaning ascribed to such term in Section 3(3) of ERISA) including, without
limitation, any employment, consulting or deferred compensation agreement,
executive compensation, bonus, incentive, pension, profit-sharing, savings,
retirement, stock option, stock purchase or severance pay plan, any life,
health, disability, accident or insurance plan or any holiday, vacation or other
employee practice, policy or benefit.
"Equipment" shall mean the Petroleum Equipment and the Store
Equipment.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
"Excluded Assets" shall have the meaning ascribed to such term
in Section 2.2 hereof.
"Excluded Liabilities" shall have the meaning ascribed to such
term in Section 2.4 hereof.
"Financial Statements" shall have the meaning ascribed to such
term in Section 5.7 hereof.
"GAAP" shall mean generally accepted accounting principles in
the United States consistently applied.
"Governmental Authority" shall mean any foreign, Federal,
state, local or other governmental, administrative or regulatory authority,
body, agency, court, tribunal or similar entity.
"Hired Employees" shall mean all employees of Seller employed
by Purchaser after Closing.
"Home Office Computer System" shall mean the computer hardware
and related software located in the home office and used to operate the software
of Professional Data Solutions, Inc.
"Improvement" shall mean any finding, discovery, invention,
addition, modification, change, formulation or development of any kind, whether
or not patented or patentable (and all proprietary information relating
thereto), including, without limitation, any new or improved device, delivery
system, design, composition of matter, method of administration or manufacturing
or other process.
"Indemnified Party" shall mean any party entitled to
indemnification pursuant to Article XII hereof and shall include such party's
Affiliates, successors and assigns and the Representatives of each of them.
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"Indemnifying Party" shall mean any party liable for
indemnification pursuant to Article XII hereof and shall include such party's
successors and assigns.
"Inventory" or "Inventories" shall mean collectively the
Merchandise Inventory and the Petroleum Inventory.
"IRS" shall mean the Internal Revenue Service.
"Knowledge" shall mean (i) the actual knowledge, after due
inquiry and investigation, of any of Seller's executive officers (Xxxxxx
XxXxxxxx, Xxxxxxx XxXxxxxx, Xxxxxx Xxxx, Xxxxxxx Xxxxx, and Xxxxx Xxxxxxxxxxx)
or directors and (ii) the existence of facts, events, occurrences or matters
with respect to which any of the persons referred to above should reasonably be
expected to have knowledge in the ordinary conduct of his duties.
"Law" shall mean any Federal, state, local or foreign law,
statute, rule, regulation, ordinance, standard, requirement, administrative
ruling, order or process (including, without limitation, any zoning or land use
law or ordinance, building code or environmental law, any securities, blue sky,
civil rights or occupational health and safety law or regulation, and any law or
regulation relating to the distribution or sale of food products, beer, wine,
cigarettes, gasoline or other motor fuel) and any court or arbitrator's order or
process.
"Lease" and "Leases" shall mean the Affiliate Leases, the
Seller Leases and the Third Party Leases.
"Liability" shall mean any debt, liability, commitment or
obligation of any kind, character or nature whatsoever, whether known or
unknown, secured or unsecured, accrued, fixed, absolute, contingent or
otherwise, and whether due or to become due.
"Lien" shall mean any lien, statutory lien (including, without
limitation, any lien, restriction or right arising under the North Carolina or
South Carolina Uniform Commercial Code - Bulk Transfers), tax lien, pledge,
mortgage, security interest, charge, encumbrance, easement, right of way,
assessment (pending or confirmed), covenant, claim, restriction, right, option,
conditional sale or other title retention agreement, warrant or equity of any
kind or nature.
"Merchandise Inventory" shall mean all foodstuffs, beverages,
tobacco products, magazines, books, household products, automotive products or
accessories, and any other products of the Business of whatever nature held for
retail sale out of the Stores.
"OSHA" shall mean the Occupational Safety and Health Act of
1970, as amended.
"NCDENR" shall have the meaning ascribed to such term in
Section 2.2(g) hereof.
"Permitted Liens" shall mean (i) liens for Taxes that are not
yet delinquent or are being contested in good faith by appropriate proceedings
and for which there are adequate reserves on the books, (ii) workers or
unemployment compensation liens arising in the ordinary course of business;
(iii) mechanic's, materialman's, suppliers, vendor's or similar liens arising in
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the ordinary course of business securing amounts that are not delinquent, (iv)
laws, ordinances and governmental regulations regulating the use of occupancy of
the Real Property or the character, dimensions or locations of the improvements
thereon, provided that none of the same are or would be violated by the
continued use of any portion of the Real Property for the purposes for which it
has been customarily used by or in the Business; and (v) exceptions discovered
by an inspection or survey or other imperfections of title that do not make
title unmarketable; provided, however, that no Permitted Lien shall be so
substantial as to impair the value of or materially interfere with the continued
or contemplated use of any material portion of the Real Property or Transferred
Assets for the purposes for which they have been used by or in the Business.
"Person" shall mean any individual, partnership, corporation,
limited liability company, association, business trust, joint venture,
governmental entity, business entity or other entity of any kind or nature.
"Petroleum Equipment" shall mean all petroleum marketing
equipment, including, but not limited to, pumps, gasoline dispensers, gas
console, gasoline canopy, canopy structure, lights, registered underground
storage tanks and lines, environmental monitoring or upgrade equipment, and any
related equipment or apparatus located at the Real Property.
"Petroleum Inventory" shall mean all gasoline, diesel and
kerosene products of the Business measured in gallons.
"Petroleum Products" shall have the meaning ascribed to such
term in Section 5.16 hereof.
"Purchase Price" shall have the meaning ascribed to such term
in Section 2.5 hereof.
"Purchaser" shall mean The Pantry, Inc., a Delaware
corporation.
"Purchaser Group" shall have the meaning ascribed to such term
in Section 7.6 hereof.
"Real Property" shall mean, collectively, the Seller Fee
Property, the Affiliate Fee Property, and the Third Party Real Property.
"Representative" shall mean any employee, officer, director,
stockholder, partner, accountant, attorney, investment banker, broker, finder,
investor, subcontractor, consultant or other authorized agent or representative
of a Person.
"Seller" shall mean Quick Stop Food Mart, Inc., a North
Carolina corporation.
"Seller Leases" shall mean leases for each of the Store
properties identified under the heading Seller Leases on Schedule 3.2.
"Seller Fee Property" shall mean the real property more
particularly described on Schedule 5.11(a) hereto.
"Store Equipment" shall mean all convenience store fixtures,
machinery, equipment, including, but not limited to, walk-in coolers, store
fixtures, counters, shelving,
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refrigeration equipment, cash registers, safes, fountain dispensing equipment,
coffee equipment, ice machines, tables and any other fixtures or equipment
necessary for running a convenience store located at any of the Stores,
regardless of whether such items are permanently attached to the Real Property,
pole lights, pole signs or other personal property attached, appurtenant to or
located in or around the buildings or improvements located at the Real Property.
"Store Supplies" shall mean cups, napkins, paper towels,
toilet paper, janitorial supplies and similar non-Inventory items which are used
in the operation or maintenance of the Stores.
"Stores" shall mean the seventy-five (75) convenience stores
operated by the Seller and identified on Schedule 1.1, each being a "Store."
"Subleases" shall mean the three (3) subleases for former
stores 42, 72 and 205 at which Seller owns Petroleum Equipment and provides
Petroleum Inventory.
"Tanks" shall have the meaning ascribed to such term in
Section 5.16 hereof.
"Tax" shall mean any foreign, Federal, state or local income,
gross receipts, license, severance, occupation, premium, environmental
(including taxes under Code Section 59A), customs, duties, profits, disability,
registration, alternative or add-on minimum, estimated, withholding, payroll,
employment, unemployment insurance, social security (or similar), excise, sales,
use, value-added, occupancy, franchise, real property, personal property, gas,
petroleum marketing business and occupation, mercantile, windfall profits,
capital stock, stamp, transfer, workmen's compensation or other tax, fee or
imposition of any kind whatsoever, including any interest, penalties, addition,
assessments or deferred liability with respect thereto, whether disputed or not.
"Tax Return" shall mean any return, report, declaration, claim
for refund, estimate, election or information statement or return relating to
any Tax, including any schedules or attachments thereto and any amendments
thereof.
"Third Party Leases" shall mean the Subleases, and those
leases described on Schedule 5.12.
"Third Party Lease Assignments" shall have the meaning
ascribed to such term in Section 3.2 hereof.
"Third Party Real Property" shall mean the real property more
particularly described on Schedule 5.11(c).
"Transaction Documents" shall mean, collectively, this
Agreement, the Seller Leases, the Affiliate Leases and all agreements,
instruments, certificates and other documents executed and/or delivered in
connection herewith or therewith.
"Transfer" shall mean any sale, transfer, conveyance,
assignment, delivery or other disposition.
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"Transferred Assets" shall have the meaning ascribed to such
term in Section 2.1 hereof.
"Trust Fund" shall have the meaning ascribed to such term in
Section 2.1(h) hereof.
"Vehicles" shall mean the motor vehicles listed on Schedule
2.1(k).
1.2 Additional Definitions. In addition to the foregoing defined terms,
other capitalized terms appearing in this Agreement shall have the respective
meanings ascribed to such terms where they first appear in the text of this
Agreement.
ARTICLE II
PURCHASE AND SALE OF ASSETS AND
ASSUMPTION OF LIABILITIES; PURCHASE PRICE
2.1 Purchase and Sale of Assets. Subject to the terms and conditions of
this Agreement, at the Closing the Seller shall Transfer to the Purchaser, and
the Purchaser shall acquire and accept from the Seller, all of the Seller's
right, title and interest in, to and under all of the furniture, fixtures,
equipment, Inventory and other assets, used or located at the Stores (or the
locations subject to the Subleases) and relating to the Business, less and
except the Excluded Assets (after giving effect to the exclusion of the Excluded
Assets, such assets, together with all right, title and interest as tenant or
lessee pursuant to the Leases, being hereinafter collectively referred to as the
"Transferred Assets"), free and clear of any and all Liens (except Permitted
Liens), such Transferred Assets to include, without limitation:
(a) all of Seller's rights and interests under the Third Party
Leases;
(b) the Store Equipment;
(c) the Petroleum Equipment;
(d) the Inventory and the Store Supplies;
(e) the Change Fund as set forth on Schedule 2.1(e);
(f) all right and interest of the Seller in, to or under the
Contracts identified on Schedule 2.1(f);
(g) all computer hardware and computer software documentation
(subject to applicable license agreements) utilized in, or connected
with, the Stores, including source code and systems documentation and
telephone switches related to point-of-sale and petroleum dispensing
equipment, and the Home Office Computer System.
(h) all rights, interests and claims under the North Carolina
Commercial Leaking Petroleum Underground Storage Tank Cleanup Fund and
the South Carolina SUPERB Account and SUPERB Financial Responsibility
Fund (individually or collectively, as applicable, the "Trust Fund"),
or any other fund, program, or insurance
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policy relating to payment or reimbursement of costs, expenses or
damages related to releases from underground storage tanks;
(i) the names "Quick Stop," "Quick Stop Food Mart," all
variations thereof and the good will associated therewith and with the
Business;
(j) the motor vehicles identified on Schedule 2.1(j).
2.2 Excluded Assets. Notwithstanding anything in Section 2.1 to the
contrary, the Seller shall retain all of its right, title and interest in, to
and under all, and shall not Transfer to the Purchaser any, of the following
assets, rights or properties (the "Excluded Assets"):
(a) all bank accounts, cash and cash equivalents, except the
Change Fund;
(b) all accounts and notes receivable of the Business
(including miscellaneous receivables and rebates due from oil companies) arising
from products sold or services rendered by the Seller prior to the Closing;
(c) all Federal, state, local and foreign income tax deposits
(to the extent not refunded) paid by the Seller in connection with the income or
operations of the Business with respect to any period ending on or prior to the
Closing;
(d) any assets not relating to the Business;
(e) all minute books and stock books of the Seller and other
corporate information not necessary for the operation of the Stores;
(f) any assets relating to any Employee Benefit Plan;
(g) all underground storage tanks that are not properly
registered with the North Carolina Department of Environment and Natural
Resources ("NCDENR") or the South Carolina Department of Health and
Environmental Control ("DHEC") and all above-ground storage tanks, unless
Purchaser specifically elects in writing to acquire any of such tanks;
(h) all assets of the Seller located at its corporate offices
except the Home Office Computer System;
(i) all Hazardous Substances, hazardous wastes, PCBs and PCB
containing materials, asbestos containing materials, and waste oil;
(i) all life insurance policies;
(k) motor vehicles, other than the Vehicles listed on Schedule
2.1(k);
(l) real property owned by Seller, subject, however, to the
Seller Leases; and
(m) non-transferable licenses and permits.
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2.3 Assumption of Liabilities. Subject to the terms and conditions of
this Agreement, at the Closing the Purchaser shall assume and agree to pay,
perform and discharge when due only the following Liabilities (collectively, the
"Assumed Liabilities"):
(a) all Liabilities incurred or accruing from and after the
Closing under the Third Party Leases;
(b) all Liabilities incurred or accruing from and after the
Closing under the Contracts; and
(c) all Liabilities in connection with the remaining
unamortized capital costs (not to exceed $38,600) pursuant to the Car Wash
Facilities Operating Agreement, dated August 1, 1994 by and between Seller and
Xxxxxxx Xxxxxx and Xxxxxxx Xxxxxx, as amended on February 27, 1997.
2.4 Excluded Liabilities. Except for the Assumed Liabilities specified
in Section 2.3 hereof, the Purchaser shall neither assume nor have any liability
for any, and the Seller shall remain fully liable for, and shall pay, perform
and discharge, (a) all Liabilities of the Seller or the Business arising out of
any act or omission occurring or state of facts existing prior to the Closing,
(b) all Liabilities of Seller arising out of any act or omission occurring after
the Closing to the extent that such Liabilities described in this clause (b) do
not arise out of and are not related to the operation of the Business by
Purchaser, its successors or assigns, and (c) all Liabilities arising from or
pursuant to Permitted Liens incurred or accruing for the period prior to Closing
(collectively, the "Excluded Liabilities").
2.5 Purchase Price. The aggregate purchase price (the "Purchase Price")
to be paid by the Purchaser to the Seller for the Transferred Assets and the
non-competition agreement described in Section 11.2 hereof shall be Fifty
Million Dollars ($50,000,000) plus Inventory at Cost.
2.6 Payment of Purchase Price. At Closing, the Purchaser shall pay to
Seller the $50,000,000 portion of the Purchase Price and an amount equal to
98.5% of Seller's book cost of current Inventory ("Inventory Estimate") by wire
transfer of immediately available funds to an account designated by Seller. Upon
completion of the Audit and determination of Cost, if the Cost exceeds the
Inventory Estimate, Purchaser shall promptly pay the difference to Seller and if
the Cost is less than the Inventory Estimate, Seller shall promptly pay the
difference to Purchaser, in either case by wire transfer of immediately
available funds to an account designated in writing by Seller or Purchaser, as
the case may be.
2.7 Allocation of Purchase Price. The Purchase Price shall be allocated
as set forth on Schedule 2.7. The allocation of the Purchase Price is intended
to comply with the requirements of Section 1060 of the Code. Purchaser and
Seller shall file Form 8594, Asset Acquisition Statement Under Section 1060 of
the Code, with their respective income tax returns for the taxable year that
includes the Closing Date, in a manner consistent with the allocation of the
Purchase Price set forth herein. Purchaser and Seller agree to satisfy all of
the reporting requirements of Section 1060 of the Code. If, in a subsequent
taxable year, it is necessary to make any allocation of an increase or decrease
in the Purchase Price, Purchaser and Seller agree to file a supplemental Form
8594 as required.
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2.8 Prorations. All (a) real estate, property and ad valorem taxes, (b)
payments due or arising under the Third Party Leases or Contracts, (c) payments
due under the Myrtle Beach Seasonal Bonus Plan as described on Schedule 2.8(c)
("Myrtle Beach Seasonal Bonus Plan"), and (d) other customarily proratable items
relating to the Transferred Assets payable on or after the Closing and relating
to a period of time both prior to and on or after the Closing shall be prorated
as of the Closing between Purchaser and Seller. If the actual amount of any such
item is not known as of the Closing, the aforesaid proration shall be based on
the previous year's assessment of such item, or in the case of the Myrtle Beach
Seasonal Bonus Plan, upon payment of such bonuses, and the parties agree to
adjust said proration and pay any underpayment or reimburse for any overpayment
within thirty (30) days after the actual amount becomes known.
2.9 Employees. If the Closing occurs, the Purchaser shall be free to
hire such persons, whether or not employees of the Seller or the Business, on
such terms and conditions of employment as the Purchaser shall determine in the
exercise of its sole discretion, and nothing in this Agreement shall establish
any enforceable rights, legal or equitable, in any Person other than the parties
hereto, including, without limitation, any employee of the Seller or the
Business or any beneficiary of such employee. Any claim, including any claim for
benefits, asserted by or on behalf of any Person with respect to such Person's
employment by the Purchaser shall be governed solely by applicable employment
policies and employee benefit plans, if any, which the Purchaser may adopt after
the Closing, as construed in accordance with applicable Federal and state law.
The Seller has delivered to the Purchaser a true and complete list (including
names, titles, job descriptions, compensation, date of hire, and full vs.
part-time status) of all employees of the Business on the date of such notice.
At least seven (7) days prior to the Closing Date, the Purchaser shall notify
Seller in writing which of such employees (if any) the Purchaser does not intend
to hire after the Closing. The Seller shall be fully liable for the employment
(or termination or severance thereof) of any persons listed in such Purchaser's
notice. In addition, the Seller shall be liable for, and shall pay, all wages,
salaries, payroll taxes and employee benefits, including without limitation,
vacation, due, owing or accrued for all employees of the Business through the
Closing. In particular, Seller shall provide and continue to provide all
continuation coverage under its group health plans required by ERISA, the Code
and applicable Law for (i) Seller's employees who terminate employment with
Seller before the Closing Date and (ii) Seller's employees who terminate
employment with Seller as of the Closing Date and whom Purchaser does not
immediately employ. All claims incurred or liabilities asserted under Seller's
Employee Benefit Plans shall be the responsibility of Seller and Purchaser shall
not have any liability with respect to such claims or liabilities.
ARTICLE III
THE CLOSING
3.1 Time and Place of Closing. The Closing shall take place at 10:00
a.m. on the Closing Date at the offices of Smith, Anderson, Blount, Dorsett,
Xxxxxxxx & Xxxxxxxx, L.L.P., 2500 First Union Capitol Center , Raleigh, North
Carolina, or at such other time or place as may be mutually agreed upon by the
parties hereto.
3.2 Instruments of Transfer. At the Closing, the Seller shall deliver
to the Purchaser such bills of sale, assignments, limited powers of attorney,
motor vehicle titles, and other good and sufficient instruments of Transfer, in
form and substance reasonably
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satisfactory to the Purchaser and its counsel, as shall be effective to vest in
the Purchaser all of the Seller's right, title and interest in, to and under the
Transferred Assets. In addition, (a) the Seller and the Purchaser shall execute
and deliver the Seller Leases; (b) the appropriate Affiliate and the Purchaser
shall execute and deliver the Affiliate Leases; and (c) the Seller and the
Purchaser shall execute and deliver assignment and assumption agreements (the
"Third Party Lease Assignments") of the rights granted and obligations imposed
in the Third Party Leases (including the Subleases) identified in Schedule 5.12
as those to be assigned. The Seller Leases and the Affiliate Leases shall be
substantially in the form of Exhibit A hereto upon the terms (including annual
rent) identified in Schedule 3.2 hereto. The Third Party Lease Assignments shall
be substantially in the form of Exhibit B.
3.3 Further Assurances. In addition to the actions, documents and
instruments specifically required to be taken or delivered by this Agreement, at
the Closing or from time to time thereafter, and without further consideration,
the parties hereto shall take such other actions, and execute and deliver such
other documents and instruments, including, without limitation, resale
certificates for Inventory, as the other party or parties hereto or their
respective counsel may reasonably request in order to effectuate and perfect the
transactions contemplated by this Agreement.
3.4 Transfer Taxes. Except for all transfer taxes and fees, if any,
which shall be borne and paid solely by the Seller, each party hereto shall pay
any and all taxes incurred by such party in connection with the transactions
contemplated by this Agreement.
ARTICLE IV
TERMINATION
4.1 Termination. This Agreement may be terminated at any time prior to
the Closing:
(a) by the mutual written consent of the Seller and the
Purchaser;
(b) by the Seller or the Purchaser, upon written notice
describing the breach in reasonable detail, if there shall have been a material
breach by the other party or parties of any of the terms or provisions of this
Agreement or any of the Transaction Documents, and such breach shall not have
been cured by July 31, 1998, so long as the breaching party or parties
diligently pursue a cure after having received notice of the breach;
(c) by the Seller or the Purchaser if any court of competent
jurisdiction or other Governmental Authority shall have issued an order, decree
or ruling or taken any other action restraining, enjoining or otherwise
prohibiting the transaction contemplated by this Agreement, and such order,
decree, ruling or other action shall have become final and non-appealable; or
(d) by the Seller or the Purchaser if Closing shall not have
occurred by July 31, 1998, so long as the delay in Closing shall not have
resulted from the intentional act of the party seeking to terminate.
4.2 Effect of Termination. In the event of the termination of this
Agreement pursuant to Section 4.1(a), (c) or (d) hereof, such termination shall
be the sole remedy, this
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Agreement shall forthwith become void (except for Sections 7.8, 8.3 and 11.1
(Confidentiality) and 13.1 (Fees and Expenses)) and there shall be no liability
on the part of any of the parties hereto, any of their respective Affiliates or
any of the Representatives of any of them; provided, however, that if such
termination shall result from the breach by a party hereto of its obligations
under this Agreement, such party shall be fully liable for any and all Damages
sustained or incurred by the other party or parties as a result of such breach
and such other party or parties shall be entitled to pursue any remedies
available at law or in equity.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby represents and warrants to the Purchaser as follows:
5.1 Organization and Good Standing. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
North Carolina, is qualified to do business in each state in which any Store is
located, and has all requisite power and authority, corporate and otherwise, to
own, operate and lease its properties and assets and to conduct the Business.
5.2 Power and Authority. The Seller has all requisite power and
authority to enter into and deliver this Agreement and the other Transaction
Documents, perform its obligations hereunder and consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the other
Transaction Documents, the performance by it of its obligations hereunder and
thereunder and the consummation of the transactions contemplated hereby have
been duly and validly authorized by all corporate and other actions on its part
required by applicable Law, its Articles of Incorporation, its by-laws or
otherwise. This Agreement and the other Transaction Documents constitute the
legal, valid and binding obligation of the Seller, enforceable against Seller in
accordance with their terms, except as the same may be limited by (a)
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights generally and (b) general
equitable principles.
5.3 No Violation. Subject to Approvals required by Schedule 5.5,
neither the execution and delivery by the Seller of this Agreement and the other
Transaction Documents, the performance by it of its obligations hereunder and
thereunder, nor the consummation of the transactions contemplated hereby and
thereby, will (a) contravene any provision of Seller's articles of
incorporation; (b) violate any material agreement or instrument to which the
Seller is a party or by which it or any of its assets or properties may be
bound; or (c) violate any material Law or any judgment, decree or order of any
court or other Governmental Authority or any arbitration award to which it is
subject or by which any of its assets or properties may be bound.
5.4 No Actions. To the Knowledge of Seller and except as set forth on
Schedule 5.4, there is no Action pending or threatened, against it, any
Affiliate of the Seller or any of their respective assets, properties or rights
(including, without limitation, any relating to any of the Transferred Assets or
the Real Property) before any court or other Governmental Authority which (a)
questions or challenges the validity of this Agreement or the other Transaction
Documents or any action taken or proposed to be taken by the Seller or any
Affiliate pursuant hereto or in connection with the transactions contemplated
hereby or (b) could, if adversely determined, have a material adverse effect on
any of the Transferred Assets, the Real
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Property, the Condition of the Business or the transactions contemplated hereby
and thereby. To the Knowledge of Seller, Schedule 5.4 hereto sets forth a true
and complete list and description of all Actions pending or threatened against
any Affiliate of the Seller or against the Seller with respect to the Business
by any court or other Governmental Authority.
5.5 Approvals. Except as set forth in this Agreement and Schedule 5.5,
neither any declaration, filing or registration with, notice to, nor Approval
of, any Governmental Authority or other Person is required to be made, obtained
or given by or with respect to any Affiliate of the Seller or the Seller or the
Business in connection with the execution, delivery or performance of this
Agreement or the consummation of the transactions contemplated hereby. The
Seller has all Approvals of any Governmental Authority required for the lawful
operation of the Business and the use and ownership or leasing of its properties
and assets as it is currently operated, except where the loss, expiration or
failure to obtain any such Approval would not have a material adverse effect on
the Condition of Seller or the Business. All such Approvals are valid, in full
force and effect and in good standing, except to the extent that any lack of
such force and effect does not, in the aggregate, have a material adverse effect
on the Condition of Seller or the Business. To the Knowledge of Seller, there is
no proceeding pending or threatened that disputes the validity of any such
Approval or that may result in the revocation, cancellation or suspension, or
any adverse modification of, any such Approval. The Seller will make available
to the Purchaser true and complete copies of all such Approvals.
5.6 Compliance with Laws and Orders. To the Seller's Knowledge and
except as described on Schedule 5.6, (a) the Seller has complied in all material
respects with all Laws applicable to it and to the operation of the Business,
(b) the Seller has not been charged with or, to the Knowledge of the Seller,
threatened with any charge concerning or under any investigation with respect
to, any violation of any provision of any Law applicable to or affecting Seller,
the Business or the Real Property, and (c) the Seller is not in violation of or
in default under, and no event has occurred which, with the lapse of time or the
giving of notice or both, could result in the violation of or default under, the
terms of any judgment, decree, order, injunction or writ of any court or other
Governmental Authority applicable to Seller, any of its assets, properties or
Stores, or the Business.
5.7 Financial Statements. Seller has delivered to Purchaser audited
financial statements for the twelve (12) months ended December 31, 1995, 1996
and 1997 and unaudited interim financial statements for the three (3) months
ended March 31, 1998, copies of which are attached as Schedule 5.7. Said
financial statements fairly present the financial condition of Seller for the
periods indicated and the results of the operations of Seller for said periods,
in conformity with generally accepted accounting principles applied on a basis
consistent with prior periods.
5.8 Absence of Certain Changes or Events. Except as described on
Schedule 5.8 hereto, since December 31, 1997 the Seller has conducted the
Business in the ordinary course and consistent with past practice and:
(a) to the Seller's Knowledge, there has not occurred (i) any
material adverse change in the Condition of the Business or any of the Stores or
(ii) any event, circumstance or combination thereof, whether arising prior to or
after December 31, 1997, which might reasonably be expected to result in any
material adverse change in the Condition of the Business or any of the Stores
before, on or after the Closing Date; and
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(b) the Seller has not (i) suffered any damage, destruction or
loss, whether covered by insurance or not, materially and adversely affecting
the Condition of the Business or any Store, (ii) entered into any material
commitment or transaction (including, without limitation, any borrowing or
capital expenditure) affecting or relating to the Business not in the ordinary
course of business in accordance with past practice, (iii) Transferred any of
the assets of the Business except in the ordinary course of business in
accordance with past practice, (iv) granted or agreed to grant any increase in
the compensation of any employee of the Business (including any such increase
pursuant to any bonus, pension, profit-sharing or other plan or commitment) or
any increase in the compensation payable or to become payable to any employee of
the Business, except for those granted in the ordinary course of business in
accordance with past practice, or (v) entered into or agreed (whether in writing
or otherwise) to enter into any agreement or other arrangement to take any
action referred to in this Section 5.8, including, without limitation, any
agreement or arrangement granting any preferential right to purchase any of the
assets of the Business (including, without limitation, the Transferred Assets)
or requiring the consent of any party to the Transfer of any such assets.
5.9 Title to Transferred Assets. (a) Except as set forth on Schedule
5.9, (i) the Seller has good legal title to all of the Transferred Assets and
the Seller Fee Property, free and clear of any pledge, mortgage or security
interest of any kind whatsoever; (ii) each Affiliate identified on Schedule
5.11(b) has good legal title to the Affiliate Fee Property identified as owned
by such Affiliate, free and clear of any pledge, mortgage or security interest
of any kind whatsoever; and (iii) with respect to the Third Party Real Property
identified on Schedule 5.11(e), Seller has no Knowledge of any adverse claim
against the title to such Third Party Real Property.
(b) Upon the delivery of the instruments of Transfer described
in Section 3.2 hereof to the Purchaser at the Closing, the Transferred Assets
shall have been Transferred to the Purchaser, free and clear of any Liens of any
kind whatsoever, other than Permitted Liens.
5.10 Inventory. The Inventories are in good and merchantable condition
and constitute a customary and normal supply and product mix, consistent with
Seller's past practice, of saleable Merchandise Inventory and Petroleum
Inventory currently sold at normal prices in the ordinary course of business of
the Business. The Seller agrees that the parties shall conduct an Audit of all
Inventories on the two days immediately prior to and on the day of the Closing.
The cost of the Audit shall be borne equally by Seller and Purchaser.
5.11 Real Property.
(a) Schedule 5.11(a) hereto contains a true and complete list
and description of all of the Seller Fee Property.
(b) Schedule 5.11(b) hereto contains a true and complete list
and description of all of the Affiliate Fee Property.
(c) Schedule 5.11(c) hereto contains a true and complete list
and description of all of the Third Party Real Property.
(d) The Real Property includes all land, easements, rights of
way, buildings, structures and other improvements used by the Seller in the
conduct of the related Stores and the Business as it is currently being
conducted.
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(e) Except as set forth on Schedule 5.11(e), neither the
Seller, any Affiliate of Seller nor, to the Seller's Knowledge, any owner of
Third Party Real Property owns, holds or is obligated under or a party to any
option, right of first refusal or other contractual right to acquire or sell any
of the Real Property or any interest therein.
(f) Except as set forth on Schedule 5.11(f), to Seller's
Knowledge, no portion of the Real Property encroaches in any material respect
upon any property belonging to any other Person, and no portion of any other
Person's property encroaches in any material respect upon any of the Real
Property.
(g) Except as set forth on Schedule 5.11(g), to the Seller's
Knowledge, with respect to the Real Property, there have not occurred (i) any
pending or threatened condemnation proceedings, (ii) any pending or threatened
Actions or (iii) any other matter materially and adversely affecting the value
thereof.
(h) To the Seller's Knowledge, all maps and surveys heretofore
delivered by the Seller to the Purchaser are true and complete copies of such
documents.
(i) Except as set forth on Schedule 5.11(i), no parcel of the
Real Property is located in a special flood hazard area designated by a
Governmental Authority.
(j) Each of the Seller, the Affiliates of Seller and, to
Seller's Knowledge, the owners of Seller Ground Lease Property, Affiliate Ground
Lease Property, and Third Party Real Property, has paid, and will continue to
pay through Closing, all taxes, assessments, charges, fees, levies and
impositions owing by each or any of them with respect to the Real Property.
Except as set forth on Schedule 5.11(j), each of the parcels of Real Property is
assessed for real estate tax purposes as a wholly independent tax lot, separate
from any adjoining land or improvements not owned by Seller, an Affiliate of
Seller or owner of Seller Ground Lease Property, Affiliate Ground Lease
Property, and Third Party Real Property, as the case may be, and constituting a
part of such parcel. Except as set forth on Schedule 5.11(j), to the Seller's
Knowledge, there is no actual or pending imposition of any assessments or public
betterments, and no improvements have been constructed or planned which would be
paid for by means of assessments upon the Real Property.
5.12 Third Party Leases .
(a) Schedule 5.12 hereto contains a true and complete list,
including annual rent, of each of the Third Party Leases. Except as specifically
identified on Schedule 5.12, the Seller's interest in each of the Third Party
Leases is free and clear of any pledge, mortgage or security interest of any
kind whatsoever. The Seller has delivered to the Purchaser true and complete
copies of all of the Third Party Leases and of all related options, if any, to
purchase the Third Party Real Property.
(b) Each Third Party Lease and each related option to purchase
is valid and binding on Seller or Seller's Affiliate, as the case may be, and to
Seller's Knowledge, on the landlord, and is in full force and effect, subject
only to exceptions based on bankruptcy, insolvency or similar Laws of general
application, and there are no existing material defaults by the Seller or
Seller's Affiliate under, or, to the Knowledge of the Seller, by any other party
to, any Lease or any related option to purchase the Third Party Real Property,
or any condition,
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event or act known to the Seller that, with notice or lapse of time or both,
would constitute a material default. Without limiting the foregoing, the Seller
has not received any notice from any Person asserting that the Seller or
Seller's Affiliate is in default under any Third Party Lease, or under any
related option to purchase, nor does the Seller have any Knowledge of a default
by it or Seller's Affiliate under any Third Party Lease, or under any related
option to purchase. The Seller or Seller's Affiliate currently enjoys peaceful
and undisturbed possession of the Third Party Real Property under each of the
Third Party Leases.
5.13 Insurance. The Seller currently has in effect policies of fire,
liability, worker's compensation and other forms of insurance which provide
coverage for the Stores and the Business (collectively, the "Insurance
Policies"). All presently effective Insurance Policies are and will remain in
full force and effect through the Closing Date. There is no notice of or basis
for any modification, suspension, termination or cancellation of any Insurance
Policy or of any claim thereunder.
5.14 Contracts. Each of the Contracts specified on Schedule 2.1(f) is,
to the Knowledge of Seller, valid and in full force and effect and has been
entered into in the ordinary course of business and, to the Knowledge of the
Seller, none of them is in default in any material respect. The Seller has
delivered to the Purchaser true and complete copies of each of the Contracts.
Except as set forth on Schedule 5.14 hereto, each Contract that is being
assigned by the Seller to the Purchaser hereunder may be so assigned without the
Approval of any Person.
5.15 Employment Law Matters.
(a) With respect to the Business, to Seller's Knowledge (i)
the Seller is in compliance with all applicable Laws respecting employment,
employment practices, terms and conditions of employment, wages and hours and
the employment of aliens or similar immigration matters except where such
non-compliance would not have a material adverse effect on the Business or the
transactions contemplated by this Agreement or the other Transaction Documents;
and (ii) the Seller is not engaged in any unfair labor practice.
(b) To the Seller's Knowledge, there is no strike, labor
dispute, slowdown or work stoppage pending or, to the Knowledge of the Seller,
threatened, against or affecting the Business.
(c) To the Seller's Knowledge, except as set forth on Schedule
5.15 hereto, none of the current employees of the Business is represented by a
labor union, and no petition has been filed or proceedings instituted by any
employee or group of employees of the Business with any labor relations board
seeking recognition of a bargaining representative at any time. There are no
controversies or disputes (including any union grievances or arbitration
proceedings) pending or, to the knowledge of the Seller, threatened, between the
Seller and any of the employees of the Business (or any union or other
representative of such employees), except for such controversies and disputes
which do not and will not, individually or in the aggregate, have a material
adverse effect on the Condition of the Business.
5.16 Environmental Matters. Schedule 5.16 hereto contains a true and
complete list and description of every underground storage tank on the Real
Property (each, a "Tank") for the storage of gasoline and other petroleum
products, by-products and constituents ("Petroleum Products"). Each Tank is
registered with NCDENR or DHEC and Seller has satisfied all
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applicable requirements for coverage under the Trust Fund for all of the Tanks
and each of them. Except as set forth on Schedule 5.16, the Tanks and related
equipment and apparatus meet the requirements of 40 C.F.R. ss. 280.21 that
underground storage tank systems must meet not later than December 22, 1998.
5.17 Property of Others. To the Seller's Knowledge no shortage exists
in (a) any inventory or finished goods owned by suppliers of the Business and
stored upon its premises or otherwise or (b) any other item of personal property
owned by another for which the Business is accountable to another. Without
limiting the foregoing, all items of personal property for which the Business is
accountable under any consignment contract, or otherwise are fully accounted for
with no shortages or missing or lost items, are in workable, usable and saleable
condition and have suffered no damage or deterioration, normal wear and tear
excepted. Should shortages exist at Closing, the Seller shall be responsible for
any required compensation or replenishment.
5.18 Equipment, Etc.
(a) Subject to the valuation threshold noted thereon, Schedule
5.18(a) hereto contains a true and complete list of all machinery, Petroleum
Equipment, Store Equipment, furniture and other tangible personal property and
assets owned by the Seller and included in the definition of Transferred Assets.
(b) Subject to the valuation threshold noted thereon, Schedule
5.18(b) contains a true and complete list of all Petroleum Equipment and Store
Equipment owned by third parties and used in the Business.
5.19 Condition of Tangible Assets. To the Seller's Knowledge, the
facilities, machinery, Store Equipment, Petroleum Equipment, furniture,
fixtures, buildings and other tangible assets which are included in the
Transferred Assets or are a part of the Real Property are in good operating
condition and repair (subject to Section 7.1 hereof), except for ordinary wear
and tear and parts or repairs of an immaterial nature in the aggregate. The
Seller has not received any notice of any violation of any Law in respect of the
Transferred Assets that has not been cured. To the Seller's Knowledge, all of
the equipment necessary for the sustained uninterrupted operation of the
Business complies, and during Seller's operation of the Business such equipment
has complied, in all material respects with all applicable Laws.
5.20 Sufficiency of Assets. Except for the Excluded Assets and as set
forth on Schedule 5.20, the Transferred Assets constitute all of the property,
assets and contractual rights presently used by the Seller with respect to the
Business and such Transferred Assets are adequate for the conduct of the
Business as presently conducted. The Business has a normal operating supply
(consistent with past practices) of Inventories, Equipment and Store Supplies.
5.21 Tax Matters. Purchaser shall not have any liability for payment or
otherwise with respect to any Taxes arising out of, attributable to or affecting
the Transferred Assets or the conduct of the Business through the Closing. There
does not exist and will not exist any liability for Taxes that may be asserted
by any taxing authority against the Transferred Assets or the conduct of the
Business through the Closing for which Purchaser will have any liability for
payment or otherwise, and no lien or other encumbrance for such Taxes has or
will attach to the Transferred Assets through the Closing.
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5.22 Finders or Brokers. The Seller has not employed any investment
banker, broker, finder or intermediary in connection with the transactions
contemplated hereby who is entitled to any fee or commission in connection with
the execution or delivery of this Agreement or any of the other Transaction
Documents or the consummation of the transactions contemplated hereby or
thereby.
5.23 Disclosure of Material Facts. To the Knowledge of the Seller, no
provision of this Agreement contains or will contain at Closing any untrue
statement of a material fact with respect to the Seller, the Business, the
Stores or the Transferred Assets or omits or will omit at Closing to state a
material fact with respect to the Seller, the Business, the Stores or the
Transferred Assets necessary in order to make the statements herein or therein
not misleading.
5.24 Certain Interests; Affiliate Transactions. Schedule 5.24 hereto
sets forth a true and complete list of all written and material unwritten
agreements, commitments, obligations and understandings binding upon or relating
to the Business which provide for or reflect the sale by Seller or the Business
to, or the purchase by Seller or the Business from, any Affiliate of Seller of
any products, goods, supplies, equipment or services which will survive the
Closing. Except as described in detail on Schedule 5.24 hereto, the Termination
of any such agreement, commitment or understanding would not have a material
adverse effect on the Condition of the Business.
5.25 Employee Benefit Plans.
(a) Schedule 5.25 lists all Employee Benefit Plans
participated in or maintained by Seller or with respect to which Seller has made
contributions or has or in the future could have any liability. For purposes of
this Section 5.25, Seller includes any other entity or business that is treated
as a single employer with Seller pursuant to Section 414(b), (c), (m) or (o) of
the Code. Seller has made available to Buyer true, correct and complete copies
of all such written Employee Benefit Plans and descriptions of any such
unwritten Employee Benefit Plans.
(b) The consummation of the transactions contemplated by this
Agreement will not (i) entitle any current or former employee of Seller to
severance pay, unemployment compensation or any similar payment for which
Purchaser could be liable, (ii) accelerate the time of payment or vesting or
increase the amount of any compensation to or in respect of any current or
former employee of Seller for which Purchaser could be liable or (iii) result in
or satisfy any condition to the payment of compensation to any current or former
employee of Seller for which Purchaser could be liable that would, in
combination with any other payment, result in an "excess parachute payment"
within the meaning of Section 280G of the Code.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants to the Seller as follows:
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6.1 Organization and Good Standing. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and is authorized to transact business in the States of North Carolina
and South Carolina.
6.2 Power and Authority. The Purchaser has all requisite power and
authority to enter into and deliver this Agreement and the other Transaction
Documents, perform its obligations hereunder and consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement
and the other Transaction Documents by it, the performance by it of its
obligations hereunder and the consummation of the transactions contemplated
hereby and thereby have been duly and validly authorized by all corporate,
stockholder and other actions on its part required by applicable Law, its
certificate of incorporation or by-laws, or otherwise.
This Agreement and the other Transaction Documents constitute
the legal, valid and binding obligations of the Purchaser, enforceable against
it in accordance with their terms, except (i) as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights generally and (ii) general
equitable principles.
6.3 No Violation. Neither the execution and delivery by the Purchaser
of this Agreement or the other Transaction Documents, the performance by it of
its obligations hereunder and thereunder, nor the consummation of the
transactions contemplated hereby and thereby, will (i) contravene any provision
of its certificate of incorporation or by-laws; (ii) violate any material
agreement or instrument to which it is a party or by which it or any of its
assets or properties may be bound; (iii) violate any material Law or any
judgment, decree or order of any court or other Governmental Authority or any
arbitration award to which it is subject or by which it or any of its assets or
properties may be bound; or (iv) have a material adverse effect on the
Purchaser's business or operations.
6.4 No Actions. There is no Action pending or, to the knowledge of the
Purchaser, threatened, against it or any of its assets, properties or rights
before any court or other Governmental Authority which (i) questions or
challenges the validity of this Agreement or any action taken or proposed to be
taken by it pursuant hereto or in connection with the transactions contemplated
hereby or (ii) could, if adversely determined, have a material adverse effect on
the transactions contemplated hereby.
6.5 Approvals. To the knowledge of the Purchaser, neither any
declaration, filing or registration with, nor any Approval of, any Governmental
Authority is required to be made or obtained by or with respect to it in
connection with the execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby, except such Approval as
may be required under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act, as
amended.
6.6 Disclosure of Material Facts. To the knowledge of the Purchaser, no
provision of this Agreement or any of the other Transaction Documents contains
or will contain at Closing any untrue statement of a material fact with respect
to it or omits or will omit at Closing to state a material fact with respect to
it necessary in order to make the statements herein or therein not misleading.
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6.7 Finders or Brokers. The Purchaser has not employed any investment
banker, broker, finder or intermediary in connection with the transactions
contemplated hereby who is entitled to any fee or commission in connection with
the execution or delivery of this Agreement or the consummation of the
transactions contemplated hereby.
ARTICLE VII
CERTAIN OBLIGATIONS OF THE SELLER PRIOR TO THE CLOSING
OR EARLIER TERMINATION OF THIS AGREEMENT
The Seller hereby covenants that, except as otherwise consented to in
writing by the Purchaser, from and after the date hereof until the Closing or
the earlier termination of this Agreement:
7.1 Conduct of Business. The Seller shall carry on the Business and
operations of the Business only in the ordinary course and in the same manner as
heretofore conducted, including, without limitation: (a) performing in all
material respects all of its material obligations under the Contracts; (b) using
its reasonable efforts to maintain and preserve (i) all of the properties,
equipment, and other assets of the Business in good repair, working order and
condition (except for ordinary wear and tear), (ii) the present workforce of the
Business (including, without limitation, those key employees who have been and
through the Closing Date will be responsible for operating, administering and
managing the Business), (iii) all of the Approvals relating to or affecting the
Business in good standing and (iv) its present relationships with, and the good
will of, the agents, suppliers, and customers of the Business and others with
which it has business relations which relate to or affect the Business; and (c)
keeping in full force and effect insurance with respect to the Business
comparable in amount and scope of coverage to that currently maintained by it
with respect to the Business. The Seller shall consult with the Purchaser from
time to time, upon the reasonable request of the Purchaser, with respect to the
conduct of the Business.
7.2 Restricted Activities and Transactions. Without the prior written
consent of the Purchaser, the Seller shall not engage in any one or more of the
following activities or transactions with respect to the Business: (a) directly
or indirectly create, incur or assume any Lien, other than Permitted Liens, on
or with respect to any property or asset (including any document or instrument
in respect of goods) of the Business, whether now owned or hereafter acquired,
or any income or profits therefrom; (b) Transfer, or agree to Transfer, any part
of the Business's assets, properties or rights, other than in the ordinary
course of the business of the Business in accordance with past practice; (c)
enter or agree to enter, into any agreement or arrangement granting any
preferential rights to purchase any of the Business's assets, properties or
rights (including, without limitation, the Transferred Assets) or requiring the
consent of any party to the Transfer of any such assets, properties or rights;
(d) make or permit to be made any amendment to or termination of any Contract or
any Approval relating to the Business other than in the ordinary course of
business in accordance with past practice; (e) make any change in any
profit-sharing, pension, retirement, long-term disability, hospitalization,
insurance or other Employee Benefit Plan, payment or arrangement, except in the
ordinary course consistent with past practice or as required by Law; (f) enter
into any collective bargaining agreement; (g) enter into any contract or
agreement except in the ordinary course of business in accordance with past
practice; or (h) except in the ordinary course of business,
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enter into any compromise or settlement of any Action affecting or relating to
the Business or any of its properties, assets or businesses.
7.3 Cooperation. The Seller shall use its best efforts to cause the
transactions contemplated by this Agreement to be consummated. Without limiting
the generality of the foregoing, the Seller shall (a) use commercially
reasonable efforts to obtain all Approvals of, make all filings with and give
all notices to, all such Governmental Authorities and other Persons as may be
necessary or reasonably requested by the Purchaser in order to consummate the
transactions contemplated by this Agreement (including, without limitation, all
of the Approvals referred to on Schedules 5.5, 5.12(c) and 5.14 hereof) and (b)
give prompt notice to the Purchaser of (i) any notice of, or other communication
relating to, any default, or any event which, with the giving of notice or the
lapse of time or both, would become a default, under, any material Contract to
which the Seller is a party or by which it or its assets or properties are bound
and which affects or relates to the Business and (ii) any notice or other
communication from any third party alleging that the consent of such third party
is or may be required in connection with the execution and delivery of this
Agreement or the transactions contemplated hereby. In addition, Seller shall
take such action as is reasonably requested by Purchaser to enable Purchaser to
obtain alcoholic beverage licenses and Tank registrations for the Stores as of
the Closing Date.
7.4 Employee Benefit Plans. The Seller shall take any and all actions
necessary or desirable to cause all Employee Benefit Plans and any other plans
or programs relating to employee benefits maintained by the Seller for the
benefit of employees of the Business to be continued in full force and effect,
except as required pursuant to the terms and provisions of such plans or
programs in the ordinary course of business in accordance with past practice.
7.5 No Negotiations. Until July 31, 1998 or earlier termination,
neither the Seller, any of its Affiliates, nor any of the Representatives of any
of them, shall, directly or indirectly, in any way contact, initiate, enter into
or conduct any discussions or negotiations, or enter into any agreements,
whether written or oral, with any Person with respect to the sale of the
Business or all or any significant portion of the assets of Seller. The Seller
shall, immediately upon receipt thereof by it or any of its respective
Affiliates or Representatives, notify the Purchaser of any offer by any Person
to make any such purchase or enter into any such agreement.
7.6 Access to the Business. The Seller hereby acknowledges that the
Purchaser, its Affiliates, and their respective Representatives (collectively,
the "Purchaser Group") may continue their due diligence investigation of the
business, operations and affairs of the Business through and until the Closing.
The Seller and its Affiliates and Representatives shall cooperate fully with
such investigation and, upon reasonable prior notice, shall afford the Purchaser
Group reasonable access, during normal business hours and at other reasonable
times, to the sales records (for 1995, 1996, 1997 and 1998 year-to-date) and
current personnel records, Stores and other facilities of the Business in order
that the Purchaser Group may have the opportunity to make such investigations
thereof as it shall deem necessary or desirable. The Seller shall furnish the
Purchaser Group with any applications or statements to be made to any
Governmental Authority in connection with the transactions contemplated by this
Agreement. Further, the Seller shall assist the Purchaser Group in contacting
and communicating with their independent accountants, suppliers and other
Persons having dealings relating to the Business. None of the information
furnished hereunder or obtained by the Purchaser Group during its due diligence
investigation of the Business shall in any way release the Seller from the
representations and warranties made by it in this Agreement.
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Commencing on the day following the date of this Agreement,
Purchaser and its Representatives shall be allowed to make environmental and
other engineering investigations, including Phase I and Phase II analysis and
testing, as Purchaser shall, in its sole discretion, deem appropriate. Purchaser
shall bear any cost of such investigation, analysis and testing. The Seller has
delivered to the Purchaser copies of all environmental reports, copies of all
environmental related claims, inquiries or requests for information by third
parties, and copies of all correspondence with environmental regulatory agencies
regarding each Store.
Notwithstanding the foregoing, Purchaser's right to enter upon
and conduct tests upon the Real Property is expressly made subject to the
following terms and conditions. Any entry upon the Third Party Real Property, or
any other property owned or leased by a party other than Seller or an Affiliate
of Seller, is conditioned upon Seller's ability to obtain consents from the
owner and lessee. Seller shall not be obligated to obtain any such consent, but
shall exercise reasonable efforts to do so. Any samples and testing will be
undertaken only at locations and in a manner that will not damage any
improvements, equipment or utilities, and Purchaser shall first verify the
location of all utilities, equipment and improvements to insure that no damage
will occur. Purchaser shall undertake all such work through SPATCO
Environmental, Inc., Charlotte, North Carolina, or through another licensed
engineering firm, in accordance with applicable legal requirements and in a
manner that minimizes any disruption to the Real Property and operations
thereon. Purchaser shall notify Seller of the date on which any entry upon the
Real Property shall occur hereunder. Promptly upon completion of any entry upon
the Real Property hereunder, Purchaser shall repair any damage caused by such
entry. Purchaser shall remove from the Real Property and properly dispose of, in
accordance with all applicable legal requirements, any waste materials generated
in connection with sampling work. Purchaser shall indemnify, defend and hold
harmless Seller and the Seller Indemnified Parties from and against any and all
liabilities, damages, claims, demands, costs and expenses of every kind
(including, without limitation, reasonable attorneys' fees) arising out of entry
upon the Real Property or any other property pursuant to this Section 7.6.
7.7 Disclosure Regarding the Seller. The Seller shall, upon reasonable
request, provide the Purchaser Group with such information and documentation
concerning the Seller as may be reasonably necessary for the Purchaser Group to
verify performance of and compliance with the representations, warranties,
covenants and conditions of the Seller contained herein.
7.8 Confidentiality. The Seller shall, and shall cause its Affiliates
and the Representatives to, keep confidential, and not disclose to others, any
proprietary information used or usable by or relating to, and obtained from, the
Purchaser, any of its Affiliates or any of the Representatives of any of them,
to the extent that such information is not or does not become readily available
to the public or is not required to be disclosed by applicable Law or court
order.
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ARTICLE VIII
CERTAIN OBLIGATIONS OF THE PURCHASER PRIOR
TO THE CLOSING OR EARLIER TERMINATION OF THIS AGREEMENT
The Purchaser hereby covenants that, except as otherwise consented to
in writing by the Seller, from and after the date hereof until the Closing or
the earlier termination of this Agreement:
8.1 Cooperation. The Purchaser shall use its best efforts to cause the
transactions contemplated by this Agreement to be consummated and, without
limiting the generality of the foregoing, to obtain all Approvals (except the
Approvals referred to on Schedules 5.5, 5.12(c) and 5.14 hereto) of, make all
filings with and give all notices to, all such Governmental Authorities and
other Persons as may be necessary or reasonably requested by the Seller in order
to consummate the transactions contemplated by this Agreement.
8.2 Disclosure Regarding the Purchaser. The Purchaser shall, upon
reasonable request, provide the Seller with such information and documentation
concerning the Purchaser as may be reasonably necessary for the Seller to verify
performance of and compliance with the representations, warranties, covenants
and conditions of the Purchaser contained herein.
8.3 Confidentiality. The Purchaser shall, and shall cause each of its
Affiliates and the Representatives of each of them to, keep confidential, and
not disclose to others, any information used or usable by or relating to, and
obtained from, the Seller, any of its Affiliates or any of the Representatives
of any of them, to the extent that such Information is not or does not become
readily available to the public or is not required to be disclosed by applicable
Law or court order.
8.4 Restricted Activities. Without the prior written consent of the
Seller, which consent will not be unreasonably withheld, the Purchaser will not
take any action or permit any event to occur which would result in a breach of
any of the representations or warranties set forth in Article VI hereof.
ARTICLE IX
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE PURCHASER
Each and every obligation of the Purchaser under this Agreement to be
performed at or before the Closing shall be subject to the satisfaction, at the
Closing, of each of the following conditions:
9.1 Representations and Warranties True. The representations and
warranties of the Seller contained in this Agreement or in any of the other
Transaction Documents shall be true and correct in all material respects as of
the Closing Date with the same effect as if made on and as of the Closing Date;
provided, however, that the materiality limitation set forth in this Section 9.1
shall apply only with respect to the condition precedent to Purchaser's
obligation to close and shall not limit or qualify Seller's representations and
warranties or Seller's indemnification obligations.
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9.2 Performance. The Seller shall have performed and complied in all
material respects with all agreements, covenants, obligations and conditions
required by this Agreement or any of the other Transaction Documents to be
performed or complied with by it at or prior to the Closing.
9.3 No Adverse Changes.
(a) None of the Stores or other assets or properties material
to the operation or business of the Business shall have been damaged, destroyed
or taken by condemnation to such an extent that substantial operation of the
Business cannot continue or under circumstances where the loss thereof will not
be substantially reimbursed through the proceeds of insurance (including,
without limitation, business interruption insurance) or condemnation awards.
(b) No material adverse change (excluding national or regional
economic downturns) shall have occurred in the Condition of the Business since
the date of this Agreement.
(c) Notwithstanding any provision of Sections 5.8(b)(i), 9.3
or 9.4 hereof, in the event that (i) one or more of the Stores is damaged,
destroyed or taken by condemnation prior to Closing or (ii) Seller is unable to
obtain any Approval required for Purchaser to take possession of a Store at
Closing, in either case, such that Purchaser cannot operate such Store in the
ordinary course of business on the Closing Date, or (iii) one or more Stores is
excluded from the Transferred Assets pursuant to Section 9.11 hereof, Purchaser
shall nevertheless be obligated to close and the Purchase Price shall be reduced
by $667,000 for each such Store; provided, however, that Purchaser may terminate
this Agreement in the event the total number of such excluded Stores exceeds
five (5), and such termination shall be considered to be in accordance with
Section 4.1(a) hereof. If, during the six (6) month period after the Closing
Date, Seller is able to deliver any such Store to Purchaser, fully operational
and otherwise in accordance with the terms of this Agreement, Purchaser shall be
obligated to close on such Store for a purchase price of $667,000.
9.4 Approvals. Except as set forth on Schedule 9.4, all filings,
declarations and registrations with and Approvals from all Governmental
Authorities and other Persons required by applicable Law or otherwise required
to permit consummation of the transactions contemplated hereby (including,
without limitation, all of the Approvals referred to on Schedules 5.5, 5.12(c)
or 5.14 hereto) shall have been made or obtained and shall be in full force and
effect, except to the extent that making any such filing, declaration or
registration or obtaining any such Approval shall have been waived in writing by
the Purchaser.
9.5 Estoppel Certificates. The Seller shall have delivered to the
Purchaser executed estoppel certificates from the lessor named in each of the
Third Party Leases, dated not more than twenty (20) days prior to the Closing
Date, stating, with respect to each such lease the following (or in such other
form as may be reasonably acceptable to Purchaser and its counsel): (a) whether
there have been any amendments, modifications or supplements of any kind to such
lease; (b) that such lease is in full force and effect; (c) the commencement and
expiration dates of such lease; (d) that the Seller or the Affiliate is not in
violation of or in default under such lease and that the lessor thereunder has
no claims against the Seller or the Affiliate; (e) the amount of and the date
through which all fixed rent and any additional rent have been paid under such
lease; (f) that no fixed rent or additional rent has been prepaid for more than
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one month in advance; (g) that such lessor consents to the assignment of such
lease to the Purchaser (if such consent is required) and consents to the
assignment of an option to purchase (if such consent is required); and (h) such
other matters as the Purchaser may reasonably request.
9.6 Subordination, Non-Disturbance and Attornment Agreements. The
Seller shall have delivered to the Purchaser Subordination, Non-Disturbance and
Attornment Agreements ("SNDAs") executed by each mortgagee holding a beneficial
interest in any of the Real Property, each as more particularly described on
Schedule 9.6, and the owner of such Real Property, in form and substance
reasonably acceptable to Purchaser and its counsel.
9.7 Deliveries. The Seller shall have delivered to the Purchaser, at or
prior to the Closing, the following:
(a) the instruments of Transfer referred to in Section 3.2
hereof;
(b) all of the books and records (except corporate books)
relating to the Business, including, without limitation, sales records (for
1995, 1996, 1997 and 1998 year-to-date), current personnel records, and all
underground storage tank and environmental records;
(c) a certificate of existence or good standing, as
applicable, for the Seller, dated not earlier than twenty (20) days prior to the
Closing Date, of each of (i) the Secretary of State of North Carolina; (ii) the
North Carolina Department of Revenue; (iii) the Secretary of State of South
Carolina; and (iv) the South Carolina Department of Revenue.
(d) resolutions, certified as of the Closing Date by the
Secretary or Assistant Secretary of the Seller, adopted by the Board of
Directors and the shareholders of the Seller, respectively, and authorizing the
execution and delivery by the Seller of this Agreement and the other Transaction
Documents, the performance by it of its obligations hereunder and thereunder and
the consummation by it of the transactions contemplated hereby and thereby;
(e) such certificates of the President of the Seller to
evidence compliance with the conditions set forth in Sections 9.1 (without
regard to the materiality limitation stated in Section 9.1) through 9.4, and 9.8
and 9.9 hereof, and any other certificates to evidence compliance with the
conditions set forth in this Article IX as may be reasonably requested by the
Purchaser or its counsel;
(f) the opinion of Xxxxxxxx, Xxxxxxxx & Xxxxxx, P.A., counsel
to the Seller and Seller's Affiliates, dated the Closing Date and addressed to
the Purchaser in form and substance reasonably satisfactory to the Purchaser and
its counsel;
(g) executed Seller Leases, Affiliate Leases and Third Party
Lease Assignments;
(h) powers of attorney, in form and substance reasonably
satisfactory to Purchaser and its counsel, assigning all rights, interests and
claims referred to in Section 2.1(h); flood certificates with respect to the
Stores identified on Schedule 5.11(i); and
(i) such other documents or certificates as shall be
reasonably requested by the Purchaser or its counsel.
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9.8 Proceedings. All corporate and other proceedings in connection with
the transaction contemplated by this Agreement and the other Transaction
Documents shall be in form and substance reasonably satisfactory to the
Purchaser and its counsel, and the Purchaser shall have received all such
originals or certified or other copies of such documents as it shall have
reasonably requested.
9.9 Absence of Litigation. There shall be no Action pending or
threatened before any court or other Governmental Authority which seeks to (a)
invalidate or set aside, in whole or in part, this Agreement or any of the other
Transaction Documents, (b) restrain, prohibit, invalidate or set aside, in whole
or in part, the consummation of the transactions contemplated hereby or thereby
or (c) obtain substantial Damages in connection therewith.
9.10 [Intentionally Omitted].
9.11 Environmental Matters. Purchaser shall promptly complete its
environmental analysis described in Section 7.6 hereof. If Purchaser is not
satisfied in its sole discretion with the environmental condition of one or more
Stores or if Seller is unable to obtain access to a Store site to conduct
environmental investigation, Purchaser shall give written notice thereof to
Seller no later than June 22, 1998, detailing the reasons for its
dissatisfaction, which may include inability to obtain access. If the reason for
Purchaser's dissatisfaction relates to petroleum releases, at Purchaser's
election: (i) the Store or Stores shall be added to Schedule 11.3(a) and Seller
shall be responsible with respect thereto as provided in Section 11.3(a) hereof;
or (ii) the Store or Stores shall be excluded from the Transferred Assets and
the Purchase Price shall be reduced as provided in Section 9.3(c) hereof. If the
reason for Purchaser's dissatisfaction relates to any other environmental
condition or inability to obtain access, Purchaser may either: (i) exclude the
Store or Stores from the Transferred Assets and the Purchase Price shall be
reduced as provided in Section 9.3(c) hereof; or (ii) give the Seller written
notice of its dissatisfaction, detailing the reasons therefor, in which event
the Seller may either promptly effect a cure to Purchaser's satisfaction, to be
determined in its sole discretion, or exclude the affected store from the
Transferred Assets and reduce the Purchase Price as provided in Section 9.3(c)
hereof.
ARTICLE X
CONDITIONS PRECEDENT TO
THE OBLIGATIONS OF THE SELLER
Each and every obligation of the Seller under this Agreement to be
performed at or before the Closing shall be subject to the satisfaction, at the
Closing, of each of the following conditions:
10.1 Representations and Warranties True. The representations and
warranties of the Purchaser contained in this Agreement or in any of the other
Transaction Documents shall be true and correct as of the date of this Agreement
and as of the Closing Date with the same effect as if made on and as of the
Closing Date.
10.2 Performance. The Purchaser shall have performed and complied in
all material respects with all agreements, covenants, obligations and conditions
required by this Agreement
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or any of the other Transaction Documents to be performed or complied with by it
at or prior to the Closing.
10.3 Approvals. All filings, declarations and registrations with and
Approvals from all Governmental Authorities and other Persons required by
applicable Law or otherwise required or desirable for the consummation of the
transactions contemplated hereby (except the Approvals referred to on Schedules
5.5, 5.12(c) and 5.14 hereto, which the Seller shall be solely responsible for
obtaining) shall have been made or obtained and shall be in full force and
effect, except to the extent that making any such filing, declaration or
registration or obtaining any such Approval shall have been waived in writing by
the Seller.
10.4 Deliveries. The Purchaser shall have delivered to the Seller, at
or prior to the Closing, the following:
(a) an amount equal to the Purchase Price described in Section
2.6 hereof;
(b) an instrument of assignment and assumption relating to the
Contracts;
(c) a good standing certificate, dated not earlier than twenty
(20) days prior to the Closing Date, of the Secretary of State of Delaware, as
to the good standing of the Purchaser in Delaware, and a certificate of
authorization, dated not earlier than ten (10) days prior to the Closing Date,
of the Secretary of State of North Carolina and the Secretary of State of South
Carolina, as to the Purchaser's authorization to transact business in North
Carolina and South Carolina, respectively;
(d) resolutions, certified as of the Closing Date by the
Secretary or Assistant Secretary of the Purchaser, adopted by the Board of
Directors of the Purchaser and authorizing the execution and delivery by the
Purchaser of this Agreement and the other Transaction Documents, the performance
by it of its obligations hereunder and thereunder and the consummation by it of
the transactions contemplated hereby and thereby;
(e) such certificates of the President or Vice President of
the Purchaser to evidence compliance with the conditions set forth in Sections
10.1, 10.2, and 10.3 hereof and any other certificates to evidence compliance
with the conditions set forth in this Article X as may be reasonably requested
by the Seller or their counsel;
(f) the opinion of Smith, Anderson, Blount, Dorsett, Xxxxxxxx
& Xxxxxxxx, L.L.P., counsel to the Purchaser, dated the Closing Date and
addressed to the Seller, in form and substance reasonably satisfactory to the
Seller and its counsel;
(g) the executed Seller Leases, Affiliate Leases and Third
Party Lease Assignments;
(h) the executed SNDAs; and
(i) such other documents or certificates as shall be
reasonably requested by the Seller or their counsel.
10.5 Proceedings. All corporate and other proceedings in connection
with the transactions contemplated by this Agreement and the other Transaction
Documents shall be in
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form and substance reasonably satisfactory to the Seller and its counsel, and
the Seller shall have received all such originals or certified or other copies
of such documents as they shall have reasonably requested.
10.6 Absence of Litigation. There shall be no Action pending or
threatened before any court or other Governmental Authority which seeks to (a)
invalidate or set aside, in whole or in part, this Agreement or any of the other
Transaction Documents, (b) restrain, prohibit, invalidate or set aside, in whole
or in part, the consummation of the transactions contemplated hereby or thereby
or (c) obtain substantial Damages in connection therewith.
ARTICLE XI
CERTAIN POST-CLOSING COVENANTS
11.1 Confidentiality.
(a) From and after the Closing, the Purchaser shall, and shall
cause its Representatives to, hold in strict confidence and, except as required
by applicable Law, not disclose to others (except its Representatives) or use
for any reason whatsoever without the prior written consent of the Seller, any
information (unless previously known to the Purchaser or any of its Affiliates
from sources other than the Seller or any of their respective Affiliates or
ascertainable from public or published information or trade sources) received by
the Purchaser or any of its Affiliates from the Seller concerning the Seller and
not relating to the Transferred Assets or the Business.
(b) From and after the Closing, the Seller shall, and shall
cause its Representatives to, hold in strict confidence and, except as required
by applicable Law, not disclose to others (except their Representatives) or use
for any reason whatsoever without the prior written consent of the Purchaser,
(i) any information (unless previously known to the Seller or any of their
Affiliates from sources other than the Purchaser or any of its Affiliates or
ascertainable from public or published information or trade sources) received by
the Seller or any of their respective Affiliates from the Purchaser or any of
its Affiliates concerning the Purchaser or its Affiliates, or (ii) any
information (unless ascertainable from public or published information or trade
sources) concerning the Transferred Assets or the Business.
11.2 Noncompetition. For a period of *************** from and after the
Closing, neither Seller nor any of its Affiliates (including, without
limitation, *******************************************************************
*************************************), will engage, directly or indirectly, in
the operation of, or own or have any interest of any kind, in any convenience
store or gasoline retail business in the Restricted Area, as defined below.
"Restricted Area" shall mean:
(a) any county located in the State of North Carolina or the
State of South Carolina in which Purchaser or any Affiliate owns or operates a
convenience store;
(b) the area within a ************ radius of any convenience
store operated by Purchaser or any Affiliate in North Carolina or South
Carolina;
(c) any county in which any of the Stores are located; and
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*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
(d) the area within a ******** radius of any of the Stores.
Notwithstanding the foregoing, the restrictions imposed by this Section
11.2 shall not apply (i) to any Store as to which Seller or its assignee retakes
possession as a result of Purchaser's breach or default under the Lease for such
Store, or (ii) to ownership by individuals of up to 2% of the stock of a public
company engaged in the convenience store business.
11.3 Responsibility for Environmental Matters.
(a) With regard to any assessment or remediation required by
Law or third party claims as to any Tanks, tanks, or Store sites arising from
leaks, releases, spills or discharges of Petroleum Products which occurred and
were identified, as set forth on Schedule 11.3(a), prior to Closing, the Seller
shall be responsible for such assessment, remediation or claim, which
responsibility may be satisfied by qualification of such assessment, remediation
or claim for coverage (including, without limitation, payment or waiver of
applicable deductibles) under the Trust Fund or by performance of all
remediation required by applicable law and performance of all other obligations
required herein at no cost to the Purchaser. Through Closing, the Seller shall
be responsible for registration of all Tanks, paying or obtaining waivers of
deductibles, and for taking all other necessary action to qualify all Tanks for
coverage by the Trust Fund. Seller shall have no responsibility for lack of
coverage due to a shortage of funds in, or insolvency of, the Trust Fund.
Schedule 11.3(a) may be updated prior to Closing by Purchaser to list any leaks,
releases, spills or discharges of Petroleum Products which are identified up to
the date of Closing. With respect to any matters identified on Schedule 11.3(a),
Seller shall have the right to undertake any investigation, negotiation (with
governmental authorities or third parties), remediation, or other work.
Purchaser shall grant Seller such access to the Store Sites as Seller shall
reasonably require to effect any such investigation, remediation, or other work,
provided that Seller will provide Purchaser with reasonable advance notice of
such access (except in an emergency) and shall use all reasonable efforts to
avoid interference with Purchaser's operations and provide Purchaser with such
access and indemnity agreement as Purchaser may reasonably request. When any
such site has qualified for Trust Fund reimbursement, Purchaser shall assume
administrative oversight thereof.
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*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
(b) The Purchaser shall be solely responsible for maintaining
registration of registered Tanks and Store sites subsequent to Closing. The
Purchaser shall be solely responsible for any assessment or remediation required
by Governmental Authority, by Law and any third party claims to the extent
arising from leaks, releases, spills or discharges of Petroleum Products which
are not identified on Schedule 11.3(a) or occur subsequent to Closing at any of
the Store sites, and Seller hereby assigns its rights and claims against third
parties relating to such assessments and remediation for which Purchaser is
responsible.
(c) Except as specifically provided in Section 5.16, Seller
makes no representations or warranties whatsoever with respect to the
environmental condition of the Real Property, or with respect to the presence or
disposal of any Hazardous Substances hazardous wastes, PCB's, PCB-containing
materials, asbestos-containing materials, or waste oil.
(d) The provisions of Section 11.3 shall neither supersede nor
obviate the representations and warranties of the Seller contained in Section
5.16(g).
(e) Notwithstanding any other provision of this Agreement,
Seller's total responsibility and Liability under this Agreement arising out of
or with respect to the Identified Conditions as of the date hereof respecting
Store Number 77, Store Number 28, and Store Number 43 shall be satisfied and
discharged as set forth in this Paragraph (e).
(i) Seller shall, at or prior to Closing, obtain and
deliver to Purchaser three letters of credit (the "Letters of Credit") in the
amounts of $******* with respect to Store No. 77, $****** with respect to Store
Number 28, and $****** to Store Number 43.
(ii) The Letters of Credit shall be issued by Branch
Banking & Trust Company (or another bank acceptable to Purchaser), shall be in
form and substance reasonably satisfactory to Purchaser and its counsel, shall
name Purchaser as the beneficiary thereof, and shall provide that Purchaser may
draw thereon by certifying in writing to the issuer thereof that Purchaser has
incurred costs in connection with the assessment or remediation required by law
or any third-party claims with respect to the Identified Condition for the
respective Store.
(iii) The Letters of Credit shall be issued for a
term of one year, and Seller shall provide renewal Letters of Credit annually in
the amount of the original Letters of Credit less the amount of any draws
theretofore paid with respect to the respective Letters of Credit. Seller shall
continue to provide the Letters of Credit until the earliest of (a) the drawing
by Purchaser of the full amount of any Letter of Credit, (b) the date upon
which, in Purchaser's reasonable opinion, no further assessment or remediation
shall be required by Law or a third-party claim with respect to the Identified
Condition with respect to the respective Store, or (c) Purchaser's agreement
that Seller shall no longer be required to furnish a Letter of Credit.
(f) Purchaser and Seller shall cooperate with each other to
enable the other to obtain any rights or benefits to which Purchaser or Seller
may be entitled.
11.4 Specific Performance; Injunctive Relief. Each of the parties
hereto acknowledges and understands that any breach or threatened breach by it
of Section 11.1 hereof or (with respect to the Seller, Xxxxxx X. XxXxxxxx,
Xxxxxxx XxXxxxxx, and Xxxxxx Xxxx) Section 11.2 hereof will cause irreparable
injury to the non-breaching party or parties and their respective Affiliates and
that money damages will not provide an adequate remedy therefor. Accordingly, in
the event of any such breach or threatened breach, the non-breaching party or
parties shall have the right and remedy (in addition to any others available at
law or in equity) to have the provisions of Sections 11.1 and 11.2 hereof
specifically enforced by, and to seek injunctive relief and other equitable
remedies in, any court having competent jurisdiction.
11.5 Change of Seller's Name. Within three (3) business days after the
Closing Date, Seller shall amend its articles of incorporation to provide for
the change of its corporate name to a name other than, and one not similar to,
"Quick Stop Food Mart, Inc." and shall effect such name change in each other
jurisdiction in which it is authorized to transact business. Seller shall
promptly thereafter deliver to the Purchaser true and complete copies of
Seller's articles of incorporation, as so amended, certified by the Secretary of
State of North Carolina, and certificates of the Secretary of State of each
other jurisdiction in which it is authorized to transact business, evidencing
the good standing of Seller in each such other jurisdiction under its new name.
Notwithstanding the foregoing, Seller may, for a reasonable period of time, use
its current supply of printed checks and stationery.
*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
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11.6 Jacksonville Store. Seller shall be responsible for completing the
construction of, and upfitting and equipping, the Store in Jacksonville, North
Carolina, consistent with Seller's customary standards, the cost of which is
included in the Purchase Price.
ARTICLE XII
SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION
12.1 Survival of Representations and Warranties. Notwithstanding (a)
the making of this Agreement, (b) any examination or investigation made by or on
behalf of the parties hereto and (c) the Closing hereunder, (i) the
representations and warranties of the parties hereto contained in this Agreement
shall survive the execution and delivery of this Agreement and the Closing for a
period of eighteen (18) months from and after the date hereof, except for the
representations and warranties contained in Sections 5.16 (Environmental
Matters), 5.21 (Tax Matters) and 5.25 (Employee Benefit Plans), which shall
survive until the expiration of the applicable statute of limitations for the
underlying cause of action, and (ii) the covenants and agreements of the parties
hereto contained in this Agreement shall survive until fully performed or
fulfilled (unless non-compliance with such covenants or agreements is waived in
writing by the party or parties hereto entitled to such performance). No claim
for indemnification pursuant to Section 12.2 hereof may be brought with respect
thereto after the applicable expiration date; provided, however, that if prior
to such date a party hereto has notified the other party or parties hereto in
writing of a claim for indemnification under this Article XII (whether or not
formal legal action shall have been commenced based upon such claim), such claim
shall continue to be subject to indemnification in accordance with this Article
XII.
12.2 Indemnification. Subject to Sections 12.1, 12.4 and 12.5 hereof,
from and after the Closing, each of the parties hereto and their respective
successors and assigns (each being an "Indemnifying Party") shall indemnify and
hold harmless the other party or parties hereto, their respective Affiliates,
successors and assigns, and the Representatives of each of them (each being an
"Indemnified Party"), from and against any and all Damages incurred thereby or
caused thereto arising out of or relating to (a) any breach or violation of, or
failure to properly perform, any covenant or agreement made by such Indemnifying
Party in this Agreement or any of the other Transaction Documents, unless waived
in writing by the Indemnified Party; (b) any breach of any of the
representations or warranties made by such Indemnifying Party in this Agreement
or any of the other Transaction Documents and not waived in writing by the
Indemnified Party; (c) with respect to the Seller, its failure to pay, perform
or satisfy when due any of the Excluded Liabilities; (d) with respect to the
Purchaser, its failure to pay, perform or satisfy when due any of the Assumed
Liabilities or any Liability or Damages arising out of or in connection with its
ownership and operation of the Business after Closing; and (e) with respect to
the Seller, Seller's failure to comply with applicable provisions of the North
Carolina or South Carolina Uniform Commercial Code - Bulk Transfers. Except as
otherwise expressly provided in Section 11.2 hereof, no Indemnified Party shall
have any recourse of any kind or nature whatsoever against any of the
Representatives of any Indemnifying Party.
12.3 Notice and Payment of Claims
(a) Promptly after receipt by any Indemnified Party of notice
of the commencement of any action, the assertion by any third party of any
claim, or otherwise giving
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rise to indemnification as provided in this Article (collectively, a "Claim"),
the Indemnified Party receiving such notice (the "Claim Notice") shall notify
the Indemnifying Party in writing of the assertion of such Claim; provided,
however, that failure to give such notice shall not affect the right to
indemnification hereunder except to the extent of actual prejudice. The
Indemnifying Party shall have the option, and shall notify the Indemnified Party
in writing within ten (10) business days after the date of the Claim Notice of
its election either (i) to participate (at its own expense) in the defense of
such Claim (in which case the defense of such Claim shall be controlled by the
Indemnified Party) or (ii) to take charge of and control the defense of such
Claim. The Indemnifying Party's failure to respond shall not relieve the
Indemnifying Party of, or its indemnification obligations under, this Section.
Each Indemnified Party shall have the right to employ separate counsel and
participate in the defense of such Claim, but the fees and expenses of such
counsel shall be at the expense of the Indemnified Party unless: (1) the
employment of such counsel shall have been specifically authorized in writing by
the Indemnifying Party or (2) the named parties in such Claim (including any
impleaded parties) include both the Indemnified Party and the Indemnifying Party
and representation of both parties would be inappropriate due to actual or
potential conflicts of interest between them, it being understood, however, that
the Indemnified Party shall not, in connection with such Claim, be liable for
the fees and expenses of more than one separate firm of attorneys (in addition
to any local counsel) and that all such fees and expenses shall be reimbursed as
they are incurred.
(b) If the Indemnifying Party elects (or is deemed to have
elected) not to assume the defense of a Claim in accordance with the preceding
Section, then the Indemnified Party may settle such Claim without the written
consent of the Indemnifying Party and the Indemnifying Party agrees to indemnify
and hold the Indemnified Party harmless from and against any such Claim settled
without its written consent. As to any claim settled with the Indemnifying
Party's written consent, the Indemnifying Party agrees to indemnify and hold the
Indemnified Party harmless from and against any such Claim by reason of such
settlement, according to the obligations of the Indemnifying Party hereunder.
(c) The Indemnified Party shall provide to the Indemnifying
Party, as soon as practicable after the date of the Claim Notice, all
information and documentation necessary to support and verify any Damages that
the Indemnified Party shall have determined have given or could give rise to a
Claim hereunder, and the Indemnifying Party shall be given access to all books
and records in the possession or under the control of the Indemnified Party
which the Indemnifying Party reasonably determines to be related to such Action.
(d) All Claims under this Articles shall be paid by the
Indemnifying Party on demand in immediately available funds in U.S. dollars
after the liability for Damages thereunder have been finally determined. The
liability for Damages under any such Claim shall be deemed to be "finally
determined" for purposes of this Article when the parties to an Action have so
determined by mutual agreement or, if disputed, when a final non-appealable
order of a court having competent jurisdiction has been entered.
12.4 Limitation on Indemnity.
(a) Maximum Liability. The maximum aggregate amount of Damages
for which (i) Seller or (ii) Purchaser shall be liable pursuant to this Article
shall be $**********.
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*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
(b) Threshold. No Indemnified Party shall seek, or be entitled
to, indemnification from any Indemnifying Party for Damages arising under
Section 12.2(b) until the aggregate amount of such Damages incurred by such
Indemnified Party (but for the operation of this Section 12.4(b)) exceeds
$*******. If Damages incurred by any Indemnified Party in connection with Claims
made pursuant to Section 12.2(b) exceed $*******, the Indemnified Party shall be
entitled to payment from the Indemnifying Party of an amount equal to all of
such Damages.
(c) Characterization of Payment. Any indemnity payment made
pursuant to this Article shall be treated by Purchaser and Seller as an
adjustment to the Purchase Price.
12.5 Mitigation of Damages. If any event shall occur which would
otherwise entitle a party hereto to indemnification hereunder, no Damages shall
be deemed to have been sustained by it to the extent of (a) any tax savings
realized by it with respect thereto or (b) any proceeds received by it from any
insurance policy with respect thereto.
ARTICLE XIII
MISCELLANEOUS
13.1 Fees and Expenses. Except as otherwise expressly provided in this
Agreement, each of the parties hereto shall bear and pay all fees, costs and
expenses incurred by it in connection with the origin, preparation, negotiation,
execution and delivery of this Agreement, the other Transaction Documents and
the transactions contemplated hereby or thereby (whether or not such
transactions are consummated), including, without limitation, any fees, expenses
or commissions of its attorneys, accountants and other representatives.
13.2 Notices.
(a) All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing (including
facsimile, telegraphic, telex or cable communication) and mailed, faxed,
telegraphed, telexed, cabled or delivered:
(i) If to the Seller, to:
Quick Stop Food Mart, Inc.
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile No.: 910/483-2634
Attention: Xxxxxx XxXxxxxx
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*Selected portions have been deleted as confidential pursuant to Rule 24b-2.
Complete copies of the entire exhibit have been filed separately with the
Securities and Exchange Commission and marked "CONFIDENTIAL TREATMENT."
with a copy to:
Xxxxx X. Xxxx
Xxxxxxxx, Xxxxxxxx & Xxxxxx, P.A.
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
(ii) If to Purchaser, to:
The Pantry, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: Chief Financial Officer
with a copy to:
Smith, Anderson, Blount, Dorsett, Xxxxxxxx &
Xxxxxxxx, L.L.P.
0000 Xxxxx Xxxxx Xxxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxx, XX 00000-0000
Facsimile No.: 000-000-0000
Attention: R. Xxxxx Xxxxxx
(b) All notices and other communications required or permitted
under this Agreement which are addressed as provided in this Section 13.2 (i) if
delivered personally against proper receipt or by confirmed facsimile or telex,
shall be effective upon delivery and (ii) if delivered (A) by certified or
registered mail with postage prepaid, (B) by Federal Express or similar courier
service with courier fees paid by the sender or (c) by telegraph or cable, shall
be effective two (2) business days following the date when mailed, couriered,
telegraphed or cabled, as the case may be. The parties hereto may from time to
time change their respective addresses for the purpose of notices to that party
by a similar notice specifying a new address, but no such change shall be deemed
to have been given until it is actually received by the party sought to be
charged with its contents.
13.3 Amendment; Waiver Neither this Agreement, nor any of the terms or
provisions hereof, may be amended, modified, supplemented or waived except by a
written instrument signed by all of the parties hereto (or, in the case of a
waiver, by the party or parties granting such waiver). No waiver of any of the
provisions of this Agreement shall be deemed to be or shall constitute a waiver
of any other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver. No failure of a party hereto to insist upon
strict compliance by another party hereto with any obligation, covenant,
agreement or condition contained in this Agreement shall operate as a waiver of,
or estoppel with respect to, any subsequent or other failure. Whenever this
Agreement requires or permits consent by or on behalf of a party hereto, such
consent shall be given in a manner consistent with the requirements for a waiver
of compliance as set forth in this Section 13.3.
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13.4 Assignment. This Agreement and all of the terms and provisions
hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns, but neither this Agreement
nor any of the rights, interests or obligations of the parties hereunder may be
assigned by any of the parties hereto without the prior written consent of the
other parties; provided, however, that the Purchaser may assign this Agreement
and its rights and obligations hereunder to any of its Affiliates which has
assumed such obligations without the prior written consent of the Seller, but
such assignment shall not release Purchaser from its obligations hereunder or
under the Leases. Any assignment which contravenes this Section 13.4 shall be
void ab initio.
13.5 Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of North Carolina, without
giving effect to the conflicts of laws principles thereof.
13.6 Severability. Each term and provision of this Agreement
constitutes a separate and distinct undertaking, covenant, term and/or provision
hereof. In the event that any term or provision hereof shall be determined to be
unenforceable, invalid or illegal in any respect, such unenforceability,
invalidity or illegality shall not affect any other term or provision hereof,
but this Agreement shall be construed as if such unenforceable, invalid or
illegal term or provision had never been contained herein. Moreover, if any term
or provision hereof shall for any reason be held to be excessively broad as to
time, duration, activity, scope or subject, it shall be construed, by limiting
and reducing it, so as to be enforceable to the extent permitted under
applicable Law as it shall then exist.
13.7 No Third Party Beneficiaries. Except as and to the extent provided
in Article XII hereof, nothing in this Agreement is intended, nor shall anything
herein be construed, to confer any rights, legal or equitable, in any person or
entity other than the parties hereto and their respective successors and
permitted assigns.
13.8 Public Announcements. Except as required by applicable Law or
judicial order, none of the parties hereto, nor any of their respective
Affiliates, successors or assigns, shall issue any press release or make any
public announcement or disclosure with respect to this Agreement or the
transactions contemplated hereby without the prior consent of the other party or
parties hereto, which consent shall not be unreasonably withheld.
13.9 Singular and Plural Forms. The use herein of the singular form
shall also denote the plural form, and the use of the plural form shall denote
the singular form, as in each case the context may require.
13.10 References. All references herein to Articles, Sections and
Exhibits shall be to Articles and Sections of and Exhibits to this Agreement.
13.11 Headings. The headings contained in this Agreement are for
convenience of reference only and shall not constitute a part hereof or define,
limit or otherwise affect the meaning of any of the terms or provisions hereof.
13.12 Entire Agreement. This Agreement, together with the schedules and
exhibits hereto, constitutes the entire agreement between the parties with
respect to the subject matter
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hereof and supersedes all prior understandings, agreements and arrangements,
both oral and written, between the parties with respect to the subject matter
hereof.
13.13 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which, when
taken together, shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and Xxxxxx X. XxXxxxxx, Xxxxxxx XxXxxxxx, and Xxxxxx Xxxx have
executed this Agreement for the limited purposes of acknowledging their
obligations pursuant to Sections 11.2 and 11.4 hereof, as of the day and year
first above written.
QUICK STOP FOOD MART, INC.
Attest:
/s/ (illegible) /s/ Xxxx Xxxx
_________________________ By:_____________________________________
Secretary Name: Xxxx Xxxx
Title: Vice President
(Corporate Seal)
THE PANTRY, INC.
/s/ Xxxxxxx X. Xxxx
By: _____________________________________
Name: Xxxxxxx X. Xxxx
Title: Vice President
/s/ Xxxxxx X. XxXxxxxx
----------------------------------------
Xxxxxx X. XxXxxxxx
----------------------------------------
Xxxxxxx XxXxxxxx
/s/ Xxxxxx Xxxx
----------------------------------------
Xxxxxx Xxxx
