ENVIRONMENTAL AGREEMENT EXHIBIT 10.7
This Environmental Agreement (the "Agreement") is made as of July 1, 1997,
between Cross-Continent Auto Retailers, Inc., a Delaware corporation ("C-CAR"),
and The Xxxx Xxxxxxx Revocable Living Trust (the "Trust") (collectively, the
"Parties").
RECITALS
WHEREAS, by that certain Stock Purchase Agreement (the "Stock Purchase
Agreement") dated February 28, 1997, as amended, the Trust and The Xxxx X.
Xxxxxxx Revocable Family Trust have agreed to sell all of the issued and
outstanding shares of capital stock of Sahara Nissan, Inc., a Nevada corporation
(the "Purchased Corporation"), to C-CAR; and
WHEREAS, in consummating such transaction, the Purchased Corporation will
continue to occupy, pursuant to a commercial lease, the parcel of property
located in Las Vegas, Nevada more fully described on Exhibit "A" attached hereto
and made a part hereof; and
WHEREAS, the Parties have agreed that the Trust shall indemnify C-CAR and
the Purchased Corporation (the "Indemnified Parties") for any and all
liabilities associated with hazardous substances (as defined below) emanating
from, or existing at, on or beneath the Property as of the date of this
Agreement; and
WHEREAS, the Parties have agreed that the Trust shall undertake full
responsibility for remediation of all hazardous substances emanating from, or
existing at, on or beneath the Property to the extent necessary to receive
approval for such remediation from appropriate local, state and federal
agencies.
NOW, THEREFORE, in consideration of the foregoing promises and mutual
representations, warranties, covenants and agreements contained herein, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereby
agree as follows:
I
DEFINITIONS
As used in this Agreement, the following terms have the following meanings:
A. "Property" means the parcel of real property described in Exhibit "A"
hereto.
B. "Environmental Regulation" means any federal, state or local law,
ordinance, rule, regulation or requirement (including provisions of common law)
relating to the environment or human health, or governing, regulating or
pertaining to the generation, treatment, storage, handling, transportation, use
or disposal of any Hazardous Substance whether now or hereafter enacted. The
term "Environmental Regulation" includes, but is not limited to, the
Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"),
as amended by the Superfund Amendments and Reauthorization Act of 1986 ("XXXX"),
42 U.S.C.
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Sections 9601-9675, the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Sections 6901-6991, the Clean Water Act, 33 U.S.C. Section
1251, ET SEQ., the Clean Air Act, 42 U.S.C. Sections 7401 ET SEQ., the Federal
Insecticide, Fungicide and Rodenticide Act ("FIFRA"), 7 U.S.C. Section 136 ET
SEQ., the Toxic Substances Control Act ("TSCA"), 15 U.S.C. Sections 2601-2671,
and any similar state or local law or regulation.
C. "Hazardous Substance" means (i) any substance or material defined in
or governed by any Environmental Regulation as a dangerous, toxic or hazardous
pollutant, contaminant, chemical, waste, material or substance; (ii) any
substance, the presence of which requires investigation, notification, reporting
or remediation under any Environmental Regulation or under common law; (iii) any
toxic, explosive, corrosive, flammable, radioactive, or other hazardous
substance which is regulated by any Environmental Regulation; and (iv) urea-
formaldehyde, polychlorinated biphenyls, asbestos or asbestos-containing
materials, petroleum, and petroleum products.
D. "Losses" means any and all liabilities, claims, damages, judgments,
penalties, attorneys' and expert fees, damages or expenses incurred by an
Indemnified Party arising from the presence of any Hazardous Substance or under
any Environmental Regulation, including without limitation (i) any and all costs
associated with investigation or identification of Hazardous Substances on any
Property; (ii) all costs of defending and settling such Indemnified Party's
liability or potential liability with governmental agencies and third parties;
(iii) all costs of remedial or corrective measures; and (iv) all other direct
and consequential losses incurred by such Indemnified Party in connection
therewith.
E. "Environmental Remediation" means all actions necessary to investigate
and, if necessary, effectively remediate (including removal and proper disposal)
all Hazardous Substances emanating from, or existing at, on or beneath the
Property to such extent necessary to obtain a "no further action" letter from
the appropriate governmental entity or agency in the State of Nevada.
II
INDEMNIFICATION AND REMEDIATION OBLIGATIONS
A. The indemnification as provided for herein shall be deemed continuing
for the benefit of the Indemnified Parties and their respective officers,
directors, stockholders, affiliates and assignees, and shall survive any
transfer of title of the Property (pursuant to sale, foreclosure or otherwise)
or any transfer of ownership of the capital stock of any Indemnified Party.
B. The Trust hereby agrees to indemnify, release and hold harmless the
Indemnified Parties from Losses arising from the presence of any Hazardous
Substances, emanating from, or existing at, on or beneath the Property, and from
Losses resulting from the performance of the Environmental Remediation.
Notwithstanding the foregoing, the Trust has no obligation to provide
indemnification for any Losses arising from the presence of Hazardous Substances
on the Property which are demonstrated by the Trust to have been caused by any
of the Indemnified Parties subsequent to the date hereof.
C. On or before December 31, 1998, the Trust shall (i) remove all
underground storage tanks located on the Property, and (ii) undertake, at its
sole cost and expense, an
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investigation of all Hazardous Substances in soil or groundwater located on,
at, beneath or emanating from the Property. If such investigation reveals the
presence of Hazardous Substances on the Property, the Trust at its sole cost
and expense shall remediate such Hazardous Substances to such extent necessary
to obtain a "no further action" letter from the appropriate governmental
entity or agency in the State of Nevada.
III
RIGHT TO OFFSET
Notwithstanding anything contained in the Stock Purchase Agreement or in
that certain Lease Agreement (the "Lease") dated July 1, 1995, by and between
Xxxx X. Xxxxxxx and Sahara Nissan, Inc., as amended, to the contrary, the
Purchased Corporation shall be entitled to offset (against any amount due under
the Lease) any Losses arising from the presence of any Hazardous Substances
emanating from, or existing at, on or beneath the Property, and from any Losses
resulting from the performance of any Environmental Remediation.
IV
MISCELLANEOUS
A. This Agreement shall supersede the environmental indemnification
contained in the Stock Purchase Agreement.
B. All matters relating to the interpretation, construction, validity and
enforcement of this Agreement shall be governed by the laws of the State of
Nevada without giving effect to any choice or conflict of law provision or rule
(whether of the State of Nevada or any other jurisdiction) that would cause the
application of laws of any jurisdiction other than the State of Nevada.
C. This Agreement contains the entire agreement of the Parties relating
to the subject matter hereof and supersedes all prior agreements and
understandings with respect to such subject matter.
D. No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel to enforce any provisions of this
Agreement, except by a statement in writing signed by the party against whom
enforcement of the waiver or estoppel is sought.
E. To the extent any provision of this Agreement shall be invalid or
unenforceable, it shall be considered deleted herefrom and the remainder of such
provision and of this Agreement shall be unaffected and shall continue in full
force and effect.
F. This Agreement shall be continuing, irrevocable and binding on the
Parties and their respective successors and permitted assigns and shall inure to
the benefit of the Indemnified Parties and their respective successors and
permitted assigns.
G. Each Indemnified Party agrees to provide the Trust and its contractors
with access to the Property, upon reasonable notice, as may be reasonably
necessary for the Trust and its agents to investigate and remediate
contamination on the Property.
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H. All notices under this Agreement shall be given in writing and sent by
certified mail, return receipt requested, postage prepaid, or by overnight
courier. Delivery of such notices shall be deemed given three (3) days after
been sent by certified mail, return receipt requested, postage prepaid, or one
(1) business day after being sent by overnight courier. Notices will be sent to
the Parties at the addresses set forth below:
C-CAR: 0000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
THE TRUST: 00 Xxxx Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
THE PURCHASED 0000 X. Xxxxxx
XXXXXXXXXXX: Xxx Xxxxx, Xxxxxx 00000
I. The signatories to this Agreement represent and warrant that they are
duly authorized to sign this Agreement.
CROSS-CONTINENT AUTO RETAILERS, INC.
By:
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Xxxx Xxxxxxxxx,
Chairman & Chief Executive Officer
THE XXXX XXXXXXX REVOCABLE
LIVING TRUST
By:
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Xxxx X. Xxxxxxx, Trustee
By:
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Xxxxxxx Xxxxxxx, Trustee
SAHARA NISSAN, INC.
By:
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Xxxx Xxxxxxxxx, President
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