EXHIBIT 10.18
AGREEMENT FOR SALE OF BUSINESS TO CONTRACT DEALER
Sale of Facility No.: 05212
Dated (for identification): September 2, 1999
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This Agreement for Sale of Business to Contract Dealer (this
"Agreement") is entered into by LLO-GAS, INC., a Delaware corporation ("Buyer"),
and PRESTIGE STATIONS, INC., a Delaware corporation ("Seller").
RECITALS
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A. Seller is a wholly owned subsidiary of Atlantic Richfield Company, a
Delaware corporation ("ARCO"). Seller operates an ARCO retail gasoline station
and am/pm mini market at the Real Estate (as defined in Section 1).
B. Seller wishes to sell to Buyer, and Buyer wishes to buy from Seller,
certain assets that Seller uses in connection with the operation of the business
at the Real Estate ("Seller's Operations") and that are located at the Real
Estate. Section 4 describes these assets (the "Business Property").
C. At the same time that Buyer and Seller sign this Agreement, Buyer and
ARCO will sign an Agreement for Sale of Real Estate to Contract Dealer (the
"Real Estate Agreement") for Buyer's purchase of ARCO's interest in the Real
Estate.
D. Buyer and Seller intend to transfer ownership of the Business Property
on the day that Buyer becomes the owner of ARCO's interest in the Real Estate.
E. At the same time that Buyer and Seller sign this Agreement, Buyer and
Seller will sign five Agreements for Sale of Business to Contract Dealer (the
"Companion Business Agreements") for certain assets that Seller uses in
connection with the operation of the businesses at the real property (the
"Companion Real Estate") at the locations (other than the location of the Real
Estate) described in the attached Exhibit "A".
F. At the same time that Buyer and Seller sign this Agreement, Buyer and
ARCO will sign five Agreements for Sale of Real Estate to Contract Dealer (the
"Companion Real Estate Agreements") for Buyer's purchase of ARCO's interest in
the Companion Real Estate.
AGREEMENT
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THEREFORE, Buyer and Seller agree as follows:
1. Basic Provisions.
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Seller's Information: Prestige Stations, Inc.
4 Centerpointe Drive, LPR 0-000
Xx Xxxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxxxx Xxxxxxx
President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Buyer's Information: LLO-Gas; Inc.
00000 Xxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Taxpayer I.D. No.: 00-0000000
Resale/Sales Tax Permit No.: SRARJ41644875
Real Estate: Street Address: 0000 Xxxx Xxxxx Xxxxxx
Xxxx, Xxxxx, XXX Code: Xxx Xxxxxxx, Xxxxxxxxxx 00000
County: Los Angeles
Deposit: $19,125.00 by Buyer's check payable to Atlantic Richfield Company
Purchase Price: $42,000.00
Purchase Price Components:
Equipment: $10,000.00
Estimated Price of Store Inventory: $7,000.00
Estimated Price of Petroleum Inventory: $25,000.00
Closing Date: See Section 6.1.
2. Purchase and Sale. Seller agrees to sell to Buyer, and Buyer agrees to
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buy from Seller, the Business Property. The purchase and sale (the
"Transaction") will be on the terms set forth in this Agreement.
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3. Acceptance by Buyer. To accept this Agreement, Buyer must deliver the
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following items to Seller within ten business days after Buyer receives this
Agreement: (i) This Agreement signed by Buyer, (ii) Buyer's check payable to
Atlantic Richfield Company in the amount of the Deposit as set forth in Section
1, and (iii) written proof that Buyer has, or will have, sufficient funds to
complete the Transaction. This proof must consist of evidence showing that (i)
Buyer has sufficient cash or other liquid assets to complete the Transaction or
(ii) Buyer has submitted to an institutional lender a fully completed
application for a loan in an amount sufficient to complete the Transaction.
Buyer must deliver these items to Seller at the same time that Buyer delivers to
ARCO the items required by Section 3 of the Real Estate Agreement.
4. Business Property. The following items constitute the Business
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Property:
(a) Equipment. All equipment, furnishings, and trade fixtures (i) that
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Seller uses in connection with Seller's Operations, (ii) that are
located at the Real Estate, whether or not those items are
attached to the land or improvements at the Real Estate, and (iii)
that are shown on the attached Schedule 1 (collectively, the
"Equipment");
(b) Petroleum Inventory. The petroleum inventory located at the Real
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Estate on the day that this transaction closes (the "Petroleum
Inventory");
(c) Store Inventory. (i) All resalable inventory of Seller's
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Operations (other than the Petroleum Inventory), in its original
packaging, that is located at the Real Estate on the day that this
transaction closes and (ii) all supplies that Seller uses in
connection with Seller's Operations and that are located at the
Real Estate on the day that this transaction closes (collectively,
the "Store Inventory");
(d) Permits. All transferable licenses and permits that Seller holds
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in connection with Seller's Operations (collectively, the
"Permits"), including without limitation (i) the underground
storage tank permit for the underground storage tanks at the Real
Estate, (ii) any conditional use permit for Seller's Operations,
and (iii) any any operating permit for Seller's Operations; and
(e) Equipment Records. All records regarding equipment monitoring and
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maintenance for Seller's Operations.
The Equipment includes, without limitation, all gasoline dispensers, affixed
sales counters, cash registers, debit card machines, and PayQuick Island Cashier
(PIC) machines.
5. Purchase Price.
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5.1 Amount. The Purchase Price for the Business Property is the
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amount set forth in Section 1. Section 13 provides for the final determination
of the amount payable for the Store Inventory and the Petroleum Inventory.
5.2 Payment. Subject to the collection of Buyer's check for the
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Deposit, Seller shall credit the Deposit to the Purchase Price. Buyer shall
deposit the balance of the Purchase Price with Seller, in cash or immediately
available funds, one business day before the date scheduled for the close of the
Transaction.
6. Closing.
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6.1 Closing Date. The Transaction will close simultaneously with the
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closings under the Real Estate Agreement, the Companion Business Agreements, and
the Companion Real Estate Agreements. Buyer and Seller shall do all that is
reasonably necessary to close the Transaction.
6.2 Closing Conditions. Each party's obligation to complete the
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Transaction is contingent on the satisfaction of the following conditions,
unless that party waives the condition before Escrow closes:
(a) Related Transactions Ready to Close. For each of the transactions
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under the Real Estate Agreement, the Companion Business
Agreements, and the Companion Real Estate Agreements, Seller has
confirmed that (i) Seller is ready and committed to close those
transactions or (ii) if the transaction is being handled through
an escrow, Seller has received notice from the escrow holder that
the escrow holder is ready and committed to close the escrow.
(b) Franchise Documents. ARCO, through its division ARCO Products
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Company ("APC"), and Buyer (i) have signed a Contract Dealer
Gasoline Agreement (the "Gas Agreement") for Buyer's operations at
the Real Estate after the closing and (ii) have signed and have
had notarized a Memorandum of Contract Dealer Gasoline Agreement
in recordable form. The Gas Agreement must have a term of 15 years
and be in ARCO's standard form.
(c) Other Closing Conditions. All closing conditions for that party's
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benefit contained in provisions of this Agreement other than this
Section 6.2 have been satisfied, or will be satisfied as a part of
the closing.
(d) Other Party's Obligations. The other party has performed all its
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obligations under this Agreement to be performed before the
closing, or will perform those obligations as a part of the
closing.
7. Delivery of Documents and Funds.
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7.1 Deliveries by Seller. At or before the closing, Seller shall
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deliver to Buyer the following:
(a) Xxxx of Sale. A xxxx of sale (the "Xxxx of Sale|) transferring
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title to the Business Property to Buyer, signed by Seller;
(b) Business Property. Physical possession of the tangible assets of
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the Business Property and all tangible evidence of the intangible
assets of the Business Property, to the extent that those items
are in Seller's possession or control;
(c) Permits. All the Permits;
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(d) Equipment Records. All records regarding equipment monitoring and
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maintenance for Seller's Operations; and
(e) Other Documents. All other instruments and documents reasonably
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required to complete the Transaction.
7.2 Deliveries by Buyer. At or before the closing, Buyer shall
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deliver to Seller the following:
(a) Cash. Cash or immediately available funds to pay the balance of
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the Purchase Price and Buyer's share of closing costs; and
(b) Other Documents and Funds. All other instruments, documents, and
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funds reasonably required to complete the Transaction.
8. No Assumed Liabilities. Buyer will not assume any liabilities of
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Seller or Seller's Operations.
9. Tax Clearance Certificates. Seller will not be required to provide to
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Buyer tax clearance certificates from applicable governmental agencies. Seller
shall indemnify and defend Buyer from all liabilities, damages, claims, costs,
and expenses (including reasonable attorneys' fees) that Buyer might incur in
connection with any tax liability of Seller related to Seller's Operations
before closing.
10. Sales and Use Tax. Buyer represents that it holds a valid
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Resale/Sales Tax Permit with the identifying number set forth in Section 1.
Therefore, Seller will not collect sales tax on the sale of the Store Inventory
or the Petroleum Inventory to Buyer.
11. Proration of Personal Property Taxes. Seller shall prorate personal
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property taxes between Seller and Buyer as of the date that the Transaction
closes.
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12. Fees and Costs. Buyer and Seller each shall pay one half of the
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filing, recording, publication, and other costs and expenses that are incurred
for the Transaction, unless the cost or expense is otherwise allocated under
this Agreement.
13. Inventory.
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13.1 Store Inventory. On the day that the Transaction closes, an
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outside inventory service (the "Service") selected by Seller will conduct an in-
store inventory of the Store Inventory. The Service will calculate the retail
price of the Store Inventory. At the completion of the in-store inventory,
Buyer and Seller each shall pay to the Service one half of the fee for the in-
store inventory. After the in-store inventory has been completed and the
Service has calculated the retail price of the Store Inventory, Seller shall
calculate the amount payable for the Store Inventory in accordance with its
then-current pricing policies for the sale of store inventory located at an
operating business of Seller to a person who intends to re-sell the store
inventory at the same location. Seller shall then notify Buyer of the amount
payable for the Store Inventory. Seller's Operations will be closed to the
public during the in-store inventory.
13.2 Petroleum Inventory. On the day that the transaction closes,
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Buyer and ARCO's representative conducting the changeover of Seller's Operations
("ARCO's Changeover Representative") shall jointly inventory the Petroleum
Inventory; and after the joint inventory has been completed, ARCO's Changeover
Representative shall calculate the amount payable for the Petroleum Inventory.
The amount payable for the Petroleum Inventory will equal Seller's rack price
based on Seller's latest invoices for gasoline delivered to the Real Estate.
Seller shall then notify Buyer of the amount payable for the Petroleum
Inventory.
13.3 Adjustment for Estimated Price of Inventor. After the petroleum
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inventory and in-store inventory are completed, the sum of the amount payable
for the Petroleum Inventory and the amount payable for the Store Inventory will
be subtracted from the sum of the Estimated Price of Store Inventory and the
Estimated Price of Petroleum Inventory set forth in Section 1. The resulting
overage or shortage will be credited or charged, as applicable, to the Purchase
Price.
14. Equipment Listing. Seller shall attach to the Xxxx of Sale, or
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otherwise deliver to Buyer before or at the closing, a list of the Equipment.
Buyer may inspect the Equipment before the close of the Transaction.
15. Seller's Representations and Warranties. Seller's representations and
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warranties in this Agreement Will survive the closing. Seller represents and
warrants to Buyer, as of the date of this Agreement and as of the close of the
Transaction, as follows:
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15.1 Ownership of Assets. Seller has, and at the close of the
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Transaction will transfer to Buyer, title to the Business Property, free and
clear of all liabilities, liens, encumbrances, security interests, leases,
contracts, and claims.
15.2 Leases, Contracts, and Agreements. No leases, contracts,
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commitments, or understandings connected with Seller's Operations will be
binding on Buyer after the closing.
15.3 Absence of Litigation. No suit, arbitration, or other
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proceeding is pending against Seller, the Business Property, or Seller's
Operations that would prevent Seller from completing the Transaction. Seller
knows of no claim or potential claim that could give rise to such a matter in
the future.
15.4 Taxes. Seller has filed all tax returns required in, connection
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with Seller's Operations. Seller has paid, or will pay before the close of the
Transaction, all taxes (including interest and penalties on the taxes) due from
Seller in connection with Seller's Operations.
15.5 Equipment. All the Equipment is in good working condition. The
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underground storage tanks and gasoline dispensers comply with the terms of
Section 10.A of the Gas Agreement, according to the certificate of upgrade
compliance provided under Section 25284 of the California Health and Safety
Code. The PayQuick Island Cashier has been installed at the Real Estate and
compiles with the terms of Section 10.B of the Gas Agreement. The video
surveillance equipment approved by ARCO has been installed at the Real Estate
and is in good working condition. Any secondary containment equipment for the
underground storage tanks required by Section 11.5 of the Gas Agreement has been
installed at the Real Estate.
15.6 Permits and Laws. Seller's Operations are in compliance with
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(i) a conditional use permit, (ii) all applicable governmental laws,
regulations, and orders as required by Section 15.1 of the Gas Agreement
(collectively, "Laws"), and (iii) the regulations governing operators of retail
gasoline stations in Arizona and California set forth in the ARCO Products
Company auditing regulatory compliance checklist. To Seller's actual knowledge,
Seller has not received notice from any governmental agency of any violation of
any Laws in connection with Seller's Operations. All necessary permits for
Seller's Operations have been obtained. "To Seller's actual knowledge" means to
the actual knowledge of Xxxx Xxxxxxxx, Xxxxx Xxxx, Xxx Xxxxxxx, or Xxxx Xxxxxx,
without independent inquiry, file review, or any investigation whatsoever.
Seller represents to Buyer that Xxxx Xxxxxxxx is Seller's Facility Remediation
Manager assigned to the Real Estate, Xxxxx Xxxx is Seller's Manager of
Environment, Health and Safety, Xxx Xxxxxxx is the Property Management
Representative assigned to the Real Estate, and Xxxx Xxxxxx is Seller's Property
Management Manager assigned to the Real Estate.
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15.7 Trademark and Trade Dress. Seller's Operations comply with the
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trademark and trade dress requirements set forth in Section 14.1 of the Gas
Agreement. All signs required by Section 14.3 of the Gas Agreement have been
installed at the Real Estate.
15.8 Employees. The employment of all employees of Seller for
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Seller's Operations will be terminated as of the date that the Escrow closes or
the changeover of Seller's Operations is completed.
16. As-Is Sale. Buyer acknowledges that (i) it is buying the Business
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Property solely in reliance on its own investigation; (ii) no covenants,
representations, or warranties have been made by Seller or on Seller's behalf,
except those set forth in this Agreement; (iii) Buyer has made itself aware of
all Laws concerning the Business Property or Buyer's operation of a business
using the Business Property; and (iv) Buyer will be buying the Business Property
in its condition existing when the Transaction closes. Nothing in the previous
sentence diminishes Seller's obligations as expressly set forth in this
Agreement.
17. Possession of Business Property. Buyer may possess and operate the
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Business Property when the Transaction closes. Buyer shall open for business at
the Real Estate within 48 hours after the Transaction closes. Any alterations
to any structure on the Real Estate will be considered a "conversion" under
Section 5.02(b) of the Mini Market Agreement.
18. ARCO's Right of First Refusal. Buyer shall grant to ARCO a right of
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first refusal to acquire the Business Property by signing the Right of First
Refusal Agreement, as defined in and required under the Real Estate Agreement.
19. Required Governmental Notices. Promptly following the closing, Buyer
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shall notify the governmental agencies that issued the Permits that Seller
transferred the Permits to Buyer and that they should send notices relating to
the Permits to Buyer.
20. Liquidated Damages. IF THE TRANSACTION FAILS TO CLOSE DUE TO BUYER'S
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DEFAULT, ESTABLISHING SELLER'S ACTUAL DAMAGES CAUSED BY BUYER'S DEFAULT WOULD BE
IMPRACTICAL OR EXTREMELY DIFFICULT. AWARDING SELLER THE DEPOSIT AND ANY ACCRUED
INTEREST ON THE DEPOSIT AS LIQUIDATED DAMAGES FOR BUYER'S DEFAULT WOULD BE
REASONABLE. THEREFORE, SELLER'S SOLE REMEDY FOR BUYER'S DEFAULT WILL BE TO KEEP
THE DEPOSIT AND ANY ACCRUED INTEREST.
SELLER AND BUYER EACH ACKNOWLEDGE THAT IT HAS READ AND UNDERSTANDS THE ABOVE
PROVISIONS OF THIS SECTION 20; AND BY ITS INITIALS IMMEDIATELY BELOW, IT AGREES
TO BE BOUND BY THOSE PROVISIONS.
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/s/ JC /s/ JLS
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Buyer's Initials Seller's Initials
21. Buyer's Authority. Within ten days after Buyer signs this Agreement,
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Buyer shall provide Seller with a copy of Buyer's governing documents (for
example, Articles of Incorporation, Bylaws, Agreement of Partnership, Limited
Liability Company Operating Agreement, or Declaration of Trust), authorizing
action (for example, corporate resolutions, consent of partners, or consent of
members), and any other document necessary to enable Seller to confirm that the
individual signing this Agreement for Buyer is authorized to bind Buyer.
22. Real Estate Agreement. This Agreement will not become effective
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unless the Real Estate Agreement, the Companion Business Agreements, and the
Companion Real Estate Agreements are signed at the same time that this Agreement
is signed. If ARCO terminates the Real Estate Agreement in accordance with its
terms, Seller may terminate this Agreement without further liability to Buyer.
If Buyer terminates the Real Estate Agreement in accordance with its terms,
Buyer may terminate this Agreement without further liability to Seller.
GENERAL PROVISIONS
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G1. Notices. Notices relating to this Agreement must be in writing and
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sent to the addresses set forth in Section 1. But a party may change its
address for notices by giving notice as required by this Section G1. A written
notice will be considered given (i) when personally delivered, (ii) two business
days after deposit in the U.S. Mail as first class mail, certified or
registered, return receipt requested, with postage prepaid, (iii) one business
day after deposit with a reputable overnight delivery service for next business
day delivery, or (iv) on the business day of successful transmission by
electronic facsimile.
G2. Additional Instruments. Seller and Buyer shall sign, acknowledge, and
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deliver to the other any further instruments reasonably required to carry out
the provisions of this Agreement.
G3. Successors and Assigns. Each party's rights and obligations under
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this Agreement bind and benefit its successors and assigns. But Buyer shall not
assign or otherwise transfer its interest under this Agreement without Seller's
prior written consent, which Seller may withhold in its sole discretion. An
assignment or other transfer by Buyer without Seller's prior written consent
will be void.
G4. Time of Essence; Business Day. Time is of the essence of each
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provision of this Agreement in which time is a factor. In this Agreement, the
term "business day" means days other than Saturdays, Sundays, and holidays
observed by the United States or the State of California.
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G5. Uncontrollable Events. Neither party will be liable to the other for
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its failure to perform under this Agreement due to events beyond its control,
including without limitation work stoppages, riots, acts of God, or other
similar events.
G6. Survival. All representations, warranties, indemnities, and releases
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contained in this Agreement will survive the close of the Transaction or the
termination of this Agreement.
G7. Entire Agreement; Modification; Waiver. This Agreement (including any
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attached Exhibits) contains the entire agreement between Buyer and Seller with
respect to the Transaction, including all representations and warranties between
them. Any modification of this Agreement must be in writing and signed by both
parties. Any waiver of a provision of this Agreement by a party must be in
writing.
G8. Governing Law. The internal laws of the State of California govern
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this Agreement.
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G9. Interpretation. The captions appearing in this Agreement are for
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convenience of reference only, and they do not affect the meanings of the
provisions of this Agreement. In this Agreement, each gender includes the other
genders. Words in the singular include the plural and vice versa, when
appropriate. The word "person" includes natural individuals and all other
entities. The word "cost includes any cost or expense. The word "term"
includes any covenant, condition, representation, warranty, or other provision
that is part of an agreement. Whenever a provision of this Agreement requires
Buyer or Seller to perform an act, that person must do so at its sole cost
(unless otherwise stated in connection with that provision).
BUYER:
LLO-GAS, INC.,
a Delaware corporation
By: /s/ Xxxx Xxxxxxxxxxx
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Xxxx X. Xxxxxxxxxxx
President
SELLER:
PRESTIGE STATIONS, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx Xxxxxxx
President
Agreed to by Escrow Holder
on Sept. 2 ,1999
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CITYWIDE ESCROW SERVICES, INC.
By: /s/ Xxxxxxxx Xxxxxx
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Xxxxxxxx Xxxxxx
Escrow Officer
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LOCATION OF THE COMPANION REAL ESTATE
(See Exhibit "A" following this cover sheet.)
EXHIBIT "A"
LOCATION OF THE COMPANION REAL ESTATE
ARCO Facility No.: 01860
Street Address, City, and State: 0000 X. Xxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
ARCO Facility No.: 05502
Street Address, City, and State: 000 Xxxx Xxxxxxxx
Xxxxxxx, Xxxxxxx 00000
ARCO Facility No.: 05212
Street Address, City, and State: 0000 X. Xxx Xxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
ARCO Facility No.: 05513
Street Address, City, and State: 00000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxxx, Xxxxxxxxxx 00000
ARCO Facility No.: 05972
Street Address, City, and State: 00000 00xx Xxxxxx
Xxxxx Xxxx Xxxxxxx, Xxxxxxxxxx 00000
ARCO Facility No.: 06202
Street Address, City, and State: 0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxx 00000
EXHIBIT "A"
