EXHIBIT 2.2
PURCHASE AND SALE AGREEMENT
THIS AGREEMENT is made and entered into as of the 1st day of March, 1996,
by and among XxxxXxxx Hospitality Corporation, a Delaware corporation,
("LSHC"), LS Holding Corp., a Delaware corporation (formerly known as XxxxXxxx
Hospitality Corp.) (LS") (LSHC and LS referred to collectively herein as
"XxxxXxxx") and Miami Subs U.S.A., Inc., a Florida Corporation ("MSUSA").
RECITALS
1. XxxxXxxx owns and operates five Miami Subs Grill restaurants (the
"Restaurants") located at (i) 00000 Xxxxxxx Xxxx, Xxxxxx, Xxxxx (the "Preston
Restaurant"), (ii) 0000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxx (the "Lemmon Restaurant"),
(iii) 0000 X. Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxxxx (the "Belt Line Restaurant"),
(iv) 0000 Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxxx, Xxxxx (the "Southwestern
Restaurant"), and (v) 0000 Xxxx Xxxx Xxxxxxxxx, Xxxxxxxx, Xxxxx (the "Town East
Restaurant") (collectively, the "Premises"). XxxxXxxx operates the Restaurants
pursuant to the Area Development Agreement between LS and MSUSA dated July 1,
1992, as amended from time to time (the "Area Development Agreement"), and the
franchise agreements between XxxxXxxx and MSUSA relating to each such restaurant
(collectively, the"Franchise Agreements").
2. XxxxXxxx desires to sell, and MSUSA desires to purchase, the
Restaurants.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, MSUSA and XxxxXxxx hereby agree as follows:
1. AGREEMENT TO PURCHASE AND SELL.
(a) MSUSA agrees to purchase from XxxxXxxx , and XxxxXxxx agrees to
sell and deliver to MSUSA , all of the assets (the "Assets") of the
Restaurants, which assets shall include all leasehold improvements,
furniture, fixtures and equipment to which XxxxXxxx has title, leases, all
territory rights, inventory, Cash on Hand (as hereinafter defined), prepaid
rents, utility and other deposits, transferrable licenses (other than
liquor licenses), and smallwares. MSUSA will not be acquiring any ownership
interest in the alcoholic beverage inventory.
(b) The sale of the Assets will be made free and clear of all claims,
liens and obligations, except for the liens and encumbrances placed on the
Assets in connection with the loan to the XxxxXxxx of $1,500,000 (the
"Xxxxxxxx Loan") by Xxxxxxxx Diversified Leasing, d/b/a Xxxxxxxx Franchise
Finance ("Xxxxxxxx") and as otherwise specifically set forth in this
Agreement. The parties acknowledge that MSUSA is not assuming any
liabilities of XxxxXxxx, or any liability or obligation in connection with
the Assets, the employees of XxxxXxxx, the Restaurants, the Premises or the
business relating thereto, except as otherwise specifically stated herein.
(c) The closing of this transaction (the "Closing") shall take place
on or before March 1, 1996 at the offices of XxxxXxxx, or at such other
time and place as shall be mutually agreed upon by the parties (the
"Closing Date").
(d) The Assets being conveyed hereunder, and the land and the
Premises, shall be
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conveyed in an "AS IS" condition, as of the date of Closing. XxxxXxxx shall
transfer any warranties it may receive from the manufacturer of any
equipment located on the premises
2. CONSIDERATION. As consideration for its purchase of the Assets, on
and as of the Closing, MSUSA will:
(a) cause its parent, Miami Subs Corporation ("MSC") to issue and
deliver to XxxxXxxx 1,325,000 shares of common stock, par value $.01, of
MSC (the "MSC Shares"); and
(b) assume the Xxxxxxxx Loan, subject to approval by Xxxxxxxx and the
release of XxxxXxxx from the Xxxxxxxx Loan;
(c) assume the leases of real estate properties listed in Schedule "A"
hereto;
(d) assume the leases of equipment listed in Schedule "B" hereto;
3. CLOSING. At Closing, XxxxXxxx shall:
(a) pay all fees owed (or estimated to be owed) to MSUSA as of the
Closing Date (including royalties and advertising fees due under the Area
Development Agreement and the Franchise Agreements), all as set forth in
Schedule "C" to this Agreement, and interest accrued thereon; provided
that, within 14 days after the Closing Date, the actual amounts shown on
Schedule "C" as estimates shall be determined, and each party shall pay to
the other any amounts owed upon reconciliation of estimated amounts paid
with actual amounts;
(b) transfer to MSUSA all food, beverage (other than alcoholic
beverages) and paper inventories in the Restaurants, cash funds on hand and
lease/equipment deposits related to any leases assumed by MSUSA, as listed
on Schedule "D" to this Agreement (collectively, the "Cash Equivalents")
and transferrable licenses, other than liquor licenses. To determine the
cash funds on hand in the cash drawers of the Restaurants, representatives
of XxxxXxxx and MSUSA will count the cash in the cash drawers at the time
of the Closing. The parties shall pay to one another any amounts owed
pursuant to any adjustments from amounts shown on Schedule D. The Cash
Equivalents will be credited to the principal balance owed by XxxxXxxx
pursuant to the Promissory Note defined and described in Section 3(d),
below;
(c) pay to MSUSA additional cash in an amount equal to the greater of
(i) the difference between the amount of the Cash Equivalents and $200,000,
or (ii) $100,000. The Cash Equivalents and amounts paid pursuant to this
Section 3(c) will be credited to the principal balance owed by XxxxXxxx
pursuant to the Promissory Note defined and described in Section 3(d),
below;
(d) deliver to MSUSA a promissory note in the principal amount of
$1,500,000, (the "Promissory Note"). The Promissory Note will not bear
interest and will be secured by the MSC Shares. The remaining principal
under Promissory Note (including any amounts added to the principal balance
pursuant to Section 4(c)(i) of this Agreement) will be due and payable on
April 30, 1996 (the "Maturity Date"), provided that, if XxxxXxxx pays to
MSUSA a payment of $50,000 of the principal amount of the Promissory Note
on or before April 30, 1996, the Maturity Date will be extended so that
remaining principal amount of the Promissory Note will be due and payable
on
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or before July 1, 1996. If the Promissory Note has not been paid in full or
the Maturity Date Extended as provided in this Section 3(d), MSUSA may, at
its option, cancel the Promissory Note and foreclose upon the MSC Shares
and shall not have any further liability or obligation whatsoever to
XxxxXxxx.
(e) deliver to MSUSA a xxxx of sale for each Restaurant with
warranties of title and schedule of Assets for each such Restaurant, so as
to transfer to MSUSA title to all of the tangible personal property being
conveyed, subject to liens and encumbrances permitted herein , and such
documents and instruments as may be reasonably required by counsel for
MSUSA.
(f) deliver to MSUSA or its designee all operating manuals, training
manuals and marketing materials, and copies thereof, used in the day-to-day
operation of the Restaurants.
(g) deliver to MSC (i) a stock pledge agreement in form satisfactory
to MSC collateralizing the MSC Shares and (ii) a conditional stock power
agreement appointing the secretary of MSC as XxxxXxxx'x attorney-in-fact
upon default.
(h) deliver to MSUSA of estoppel certificates and landlord consents in
form satisfactory to MSUSA. The parties acknowledge that the leases and
subleases of Premises of which Shoney's, Inc. is the landlord permit
XxxxXxxx to assign such leases and subleases without the consent of
Shoney's, Inc.; and
(i) have a normal inventory of food, paper and supplies, and beverages
adequate for the operation of the Restaurants.
4. COVENANTS.
(a) XxxxXxxx shall provide all necessary records (including originals
and copies of employee records of employees that MSUSA elects to hire, and
information on existing benefit plans), financial and other information
(including, if required for purposes of preparing filings with the
Securities and Exchange Commission ("SEC"), audited financial statements,
at XxxxXxxx'x expense), all Restaurant leases and lease files, and such
other information that MSUSA may reasonably request.
(b) MSUSA shall provide all necessary records, financial and other
information (including, if required for purposes of preparing necessary
filings with the SEC, audited financial statements, at MSC's expense) and
such other information that XxxxXxxx may reasonably request.
(c) Following the Closing, XxxxXxxx shall:
(i) satisfy or pay all employees, vendors and suppliers to the
Restaurants any outstanding amounts owed for work performed, products
or services delivered and/or rendered to the Restaurants prior to the
Closing. If MSUSA deems it necessary to satisfy any such remaining
obligation of XxxxXxxx in order to prevent disruption of ongoing
Restaurant operations, MSUSA shall notify XxxxXxxx in writing of such
remaining obligation; XxxxXxxx shall have ten (10) days from the date
of receipt of such notice to cure
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any such obligation. If XxxxXxxx has not cured such obligation by the
end of such 10-day period, MSUSA may satisfy such obligation; any
payments made by MSUSA pursuant to this Section 4(c)(i), including
payments of interest and penalties, shall be added to the principal
amount of the Promissory Note or, if the Promissory Note has been paid
or cancelled, such amounts shall be immediately payable to MSUSA by
XxxxXxxx.
(ii) not seek to employ Xxxxx Xxxxxxx or any other person
employed by XxxxXxxx at any of the Restaurants (excluding any
corporate, clerical or managerial personnel of XxxxXxxx) for two years
following the Closing without the consent of MSUSA.
(d) Provided that, following the Closing, XxxxXxxx has complied with
the terms and conditions of this Agreement, and with the covenants
representations and warranties therein,
(i) within 60 days after the Closing, MSUSA shall cause MSC to
file with the SEC a registration statement on Form S-3 or other
appropriate form relating to the sale of the MSC Shares; use its best
efforts to cause the effectiveness of such registration statement;
and, to the extent required, register or qualify the MSC Shares under
the securities laws of those states that XxxxXxxx may designate. Upon
effectiveness of such registration statement, MSUSA shall cause MSC to
keep such registration open for a period that shall expire on the
earlier of the date that is 24 months after the Closing or the time at
which XxxxXxxx shall have sold or disposed of all the MSC Shares. MSC
shall bear all expenses of any registration of MSC Shares pursuant to
this Section 4(d)(i);
(ii) pay to XxxxXxxx 50% of the aggregate cash proceeds of the
sale of one or more of the Restaurants pursuant to one or more
contracts of sale entered into during the 12-month period following
the Closing, to the extent such aggregate cash proceeds exceed
$2,300,000. For purposes of this Agreement, cash proceeds shall
include marketable securities and other cash equivalents, as well as
principal payments received on notes issued in connection with such
sale or sales, and cash.
(e) Following the Closing, MSUSA shall permit XxxxXxxx to originate
television programming at the Southwestern Restaurant at no cost to
XxxxXxxx, subject to conditions and parameters mutually agreeable to
XxxxXxxx and MSUSA.
(f) For a period of five (5) years following the Closing, XxxxXxxx
shall not enter into or acquire one or more restaurants in the Dallas/Fort
Worth, Texas that compete with the Restaurants. Notwithstanding the
foregoing, XxxxXxxx may hold publicly traded securities in one or more
companies that own or operate such restaurants, if XxxxXxxx is not an
affiliate (as such term is defined in Rule 405 promulgated under the
Securities Act of 1933) of such companies.
(g) If requested by MSUSA, and at MSUSA's expense, XxxxXxxx shall
timely cooperate and assist MSUSA in transferring each Restaurant's liquor
license to MSUSA or an affiliate of MSUSA or in acquiring a new liquor
license. Until MSUSA secures its own liquor licenses for each Restaurant,
XxxxXxxx agrees, if permitted by law, to consent to MSUSA or its affiliate,
at no cost or expense to XxxxXxxx or its affiliates, to sell alcoholic
beverages using the existing liquor licenses owned by XxxxXxxx or its
affiliates. MSUSA agrees to indemnify and hold XxxxXxxx and its affiliates
harmless from any claims or actions arising thereunder from the date of
Closing. MSUSA
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agrees to use due diligence and best efforts to apply for new permits and
licenses. XxxxXxxx, or its affiliates, agrees to exercise its best efforts
to cause Sub Club II, Inc., operating in the Southwestern Restaurant, and
Sub Club I, private club permit #N232052, operating at the Preston
Restaurant, and Miami Subs Grill private club permit #N241750, operating at
the Belt Line Restaurant to continue the sale of alcoholic beverages,
subject only to termination of such use by the permit holder upon thirty
(30) days notice to MSUSA. XxxxXxxx, or its affiliate, will cause the
permit holders, if requested by MSUSA, to timely execute and deliver such
instruments and take such actions as are reasonable and necessary to allow
MSUSA to transfer such licenses, reacquire the existing licenses and/or
acquire new licenses, all at the expense of MSUSA or its affiliates.
(h) XxxxXxxx shall timely pay all Restaurant employees for services
rendered through the Closing Date. XxxxXxxx shall be current with any
payments due to any federal, state or governmental entity for any payroll
or withholding taxes, and provide MSUSA with receipts and verification of
such payment satisfactory to MSUSA. XxxxXxxx shall pay any and all employee
taxes accrued through the Closing Date.
5. REPRESENTATIONS AND WARRANTIES
(a) XxxxXxxx represents and warrants that:
(i) This Agreement, including the covenants set forth in Section
4, is a valid and binding obligation of XxxxXxxx. Neither the delivery
of this Agreement nor the consummation of the transactions it
contemplates will result in a breach, or give rise to termination, or
accelerate the performance required by any terms of any agreement to
which XxxxXxxx is a party, or constitute a default thereunder, or
result in the creation of any lien, charge or encumbrance upon any of
the assets of XxxxXxxx. LSHC and LS represent and warrant that this
transaction does not violate their respective Certificates of
Incorporation and Bylaws, each as amended, and that the execution and
delivery of this Agreement by their respective officers have been duly
approved by their respective boards of directors. Except for the
approval of Xxxxxxxx to the assumption by MSUSA of the Xxxxxxxx Loan,
and the approval by the lessors of the Premises and the lessors of
equipment leased by XxxxXxxx, the consent or approval of a third party
is not required in order that XxxxXxxx may enter into this Agreement;
(ii) XxxxXxxx has good and marketable title to all of the Assets,
subject to no liens, mortgages, restrictions, pledges, encumbrances or
charges as of the date of Closing.
(iii) There are no actions, suits, proceedings, investigations
pending or, to XxxxXxxx'x knowledge, threatened in any court or before
any governmental agency or instrumentality against, that will have a
material adverse effect (for purposes of this subsection, in excess of
$10,000) on XxxxXxxx or the Assets or that are disclosed in Schedule F
to this Agreement
(iv) XxxxXxxx has not received notice of any violation of any
applicable Federal, State or local statute, law or regulation
(including, without limitation, any applicable building, zoning or
other law, ordinance or regulations), that will have a material
adverse effect (for purposes of this subsection, in excess of $10,000)
on the Assets and the business
5
being sold, and, to XxxxXxxx'x knowledge, there are no such
violations;
(v) XxxxXxxx knows of no broker, finder, intermediary, attorney
or other person who may have been involved in this transaction who
would be entitled to the commission or finder's fee upon its
consummation;
(vi) To XxxxXxxx'x knowledge, the Restaurants and Assets are in
good operating condition, structurally sound and in good repair;
(vii) XxxxXxxx is acquiring the MSC Shares for investment
purposes only, and not with a view to their distribution;
(viii) All tax returns and reports of the business have been
filed as required by law; all taxes, assessments, fees, and other
governmental charges upon the business or upon any of the Assets,
employees, property or income that are due and payable as of the
Closing date have been paid (other than those not yet due and payable
without penalty or interest), including, but not limited to, sales
taxes, personal property taxes, real estate taxes, unemployment
compensation taxes, social security and all other withholding and
payroll taxes;
(ix) The leases for each of the Restaurants are in good standing;
all rent and other amounts payable have been paid; there are no
material defaults under any of the Leases and no material grounds for
default or early termination exists; and there are no material
violations of any kind, pending or, to XxxxXxxx'x knowledge,
threatened regarding the premises, including health department,
building code or zoning violations; the premises are in substantial
compliance with all codes and ordinances;
(x) To the best of XxxxXxxx'x knowledge, XxxxXxxx has not
deposited or disposed of any hazardous materials or waste on the
premises, and there are no hazardous materials or wastes on the
premises;
(xi) XxxxXxxx shall comply with all applicable bulk sales laws
and indemnify and hold MSUSA and its affiliates harmless from the
failure to comply with any such laws;
(xii) XxxxXxxx shall pay to the law firm of Xxxxxxxx, Xxxxxxxx &
Xxxxxx $15,277.27 on or before the Closing Date.
(xiii) all covenants, warranties and representations made herein
shall survive the Closing.
(b) MSUSA represents and warrants that:
(i). This agreement is a valid and binding obligation of MSUSA and
neither the delivery of this Agreement nor the consummation of the
transactions it contemplates will result in a breach, or give rise to
termination, or accelerate the performance required by any terms of
any agreement to which MSUSA is a party, or constitute a default
thereunder, or result in the creation of any lien, charge or
encumbrance upon any of the assets of MSUSA.
6
MSUSA represents and warrants that this transaction does not violate
its Articles of Incorporation or Bylaws, as amended, and that the
execution and delivery of this Agreement by its officers has been duly
approved by its board of directors. The consent or approval of a third
party is not required in order that MSUSA may enter into this
Agreement.
(ii) The issuance and delivery of the MSC Shares, the filing of
the registration statement pursuant to Section 4(c)(1) of this
Agreement and related transactions and have been duly authorized by
the MSC board of directors. The MSC Shares, when issued, will be duly
authorized and non-assessable and, upon full payment of the Promissory
Note, fully paid.
(iii) There are no actions, suits, proceedings, investigations
pending or, to MSUSA's knowledge, threatened in any court or before
any governmental agency or instrumentality against, by or affecting
MSUSA that adversely affect MSUSA's ability to enter into this
Agreement, the transactions contemplated herein, or the MSC Shares,
except as may be disclosed in the reports filed by MSC with the SEC.
(iv) MSUSA knows of no broker, finder, intermediary, attorney or
other person who may have been involved in this transaction who would
be entitled to the commission or finder's fee upon its consummation.
6. CONDITIONS OF CLOSING. Closing of this transaction is made expressly
conditioned upon the following:
(a). All representations, warranties and covenants of XxxxXxxx and
MSUSA contained in this Agreement shall be true and correct in all material
respects on and as of the Closing Date;
(b) XxxxXxxx and MSUSA shall have performed and complied with all of
the terms, covenants, agreements and conditions of this Agreement in all
material respects prior to or at the Closing;
7. RESTRICTIONS ON RESALE, RIGHTS TO REPURCHASE, RIGHT OF FIRST REFUSAL
OF MSC SHARES. The MSC Shares are subject to the following restrictions on
resale, right of repurchase and rights of first refusal:
(a) Except as otherwise provided herein, during the six (6) month
period following the Closing, XxxxXxxx shall not sell or dispose of any of
the MSC Shares, without the approval of MSC.
(b) During the six (6) month period following the Closing, MSC will
have the right to acquire from XxxxXxxx all or any portion of the MSC
Shares at for $2.50 per share (the "Repurchase Price"). The Repurchase
Price shall be proportionately adjusted whenever any of the following
events occur: if MSC should (i) declare or pay a dividend on the its
outstanding common stock payable in shares of its capital stock; (ii)
subdivide its outstanding common stock, combine the outstanding Common
Stock into a smaller number of shares; (iii) issue any shares of its
capital stock by reclassification of the Common Stock (including any such
reclassification in connection with a consolidation or merger in which MSC
is the continuing corporation); or (iv) make any distribution of its assets
to holders of its Common Stock as a liquidation or partial liquidation
dividend or by way
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of return of capital.
(c) Following the six (6) month period provided in Section 7(a),
above, XxxxXxxx shall not sell or dispose of more than 240,000 MSC Shares
per calendar quarter or 20,000 MSC Shares per week, except in a private
transaction, and subject to the MSC right of first refusal provided in
Section 7(d), below and applicable provisions of the Securities Act of 1933
and the rules promulgated thereunder. The number of shares that XxxxXxxx
may sell or dispose of pursuant to this paragraph shall be proportionately
adjusted upon the occurrence of any of the events listed in Section 7(b),
above.
(d) For a period of thirty (30) months following the six (6) month
period provided in Section 7(a), above, MSC shall have a right of first
refusal to acquire any MSC Shares proposed to be sold by XxxxXxxx at then-
current market trading price, less applicable brokerage commissions, if
any, or on the same terms as offered to a third party.
8. TERMINATION OF AREA DEVELOPMENT AGREEMENT AND FRANCHISE AGREEMENTS.
(a) XxxxXxxx acknowledges and agrees that the Area Development
Agreement and the Franchise Agreements will be terminated in their entirety
upon Closing, except for the obligations of confidentiality and post-
termination noncompetition provisions set forth therein, and that neither
XxxxXxxx nor anyone claiming by or through XxxxXxxx will have any right,
title or interest in the Area Development Agreement or the Franchise
Agreements.
(b) MSUSA acknowledges and agrees that,
(i) upon Closing of this Agreement and the termination of the
Area Development Agreement and the Franchise Agreements as provided
herein, MSUSA shall release XxxxXxxx from all obligations to MSUSA
under the Area Development Agreement and Franchise Agreements
including, without limitation, the development of new Miami Subs Grill
restaurants in the Dallas/Fort Worth area and the payment of any fees,
royalties or other payments to MSUSA that accrue after the Closing,
except for the obligations of confidentiality and post-termination
noncompetition provisions set forth therein; and
(ii) upon Closing of this Agreement, the termination of the Area
Development Agreement and Franchise Agreements, the assumption by
MSUSA of the Xxxxxxxx Loan and the payment by XxxxXxxx of legal fees
to the law firm of Xxxxxxxx, Xxxxxxxx & Xxxxxx, as provided herein,
MSUSA shall release XxxxXxxx from all obligations to MSUSA under that
certain Forbearance and Restructuring Agreement dated as of June 30,
1995.
9. EXPENSES AND TAXES.
(a) All sales, transfer or use taxes, real estate, payroll,
unemployment compensation and/or other taxes and fees, if any, including
sales taxes that may be imposed or assessed as the result of the
transactions effected by this Agreement, except those taxes imposed upon
the income of XxxxXxxx, if any, shall be reported and paid by XxxxXxxx as
soon after the Closing as may be required
8
by taxing authorities pursuant to Federal, State or local laws. Each party
shall pay its own attorneys' fees.
(b) MSUSA and XxxxXxxx agree to adjust and pay their respective pro-
rata share of, as of the date of Closing, sewer charges, water charges,
public utility service charges, fuel charges, payroll, unemployment
compensation and other pro-ratable charges attributable to the operation of
the Premises. MSUSA shall either reimburse XxxxXxxx at Closing and take an
assignment of such deposits, or shall post its own deposits in which event
all deposits paid by XxxxXxxx shall be returned to XxxxXxxx. XxxxXxxx
acknowledges that MSUSA will use and deposit credit card sales into
XxxxXxxx'x account and XxxxXxxx will reimburse MSUSA for all such deposits
on a weekly basis.
(c) XxxxXxxx'x pro rata portion of estimated real estate and personal
property taxes for 1996, set forth on Schedule E, shall be added to the
principal balance of the Promissory Note. The parties shall pay to one
another any amounts owed as a result of differences between the estimated
amounts set forth on Schedule E and actual real estate and personal
property taxes paid.
10. INDEMNIFICATION.
(a) INDEMNIFICATION. (i) MSUSA hereby agrees to hold harmless, defend
and indemnify XxxxXxxx from any and all losses, damages, liabilities and
costs and expenses incurred or suffered by XxxxXxxx as a result of the
breach by MSUSA of any covenant, representation or warranty contained in
this Agreement, any obligation or liability arising as a result of the
operation of the Restaurants subsequent to the Closing, in the case of
XxxxXxxx, and any third party claims (including, without limitation, any
creditor, employee vendor, supplier and governmental entity arising
subsequent to the Closing.
(ii) XxxxXxxx hereby agrees to hold harmless, defend and
indemnify MSUSA from any and all losses, damages, liabilities and
costs and expenses incurred or suffered by MSUSA as a result of the
breach of any covenant, representation or warranty contained in this
Agreement, any obligation or liability arising as a result of the
operation of the Restaurants prior to the Closing, and any third party
claims (including, without limitation, any creditor, employee vendor,
supplier and governmental entity arising prior to the Closing.
(iii) This Section 10 shall survive the Closing.
(b) PROCEDURE FOR INDEMNIFICATION. In the event of any claim, suit or
proceeding brought against a party for which another party owes an
indemnification obligation under this Section 10 (a "Claim"), the following
shall apply:
i. The indemnified party shall promptly provide written notice to
the indemnifying party of the Claim, and the indemnifying party shall
have sole control and authority to defend and resolve the Claim.
However, the indemnifying party shall not settle any Claim without the
prior written consent of the indemnified party, which consent shall
not be unreasonably withheld.
ii. The indemnified party shall have the right, at its own
expense, to appoint its own counsel to participate in the Claim, and
the indemnifying party shall cooperate with
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such counsel. Moreover, if the indemnifying party does not reasonably
defend the indemnified party with regard to a Claim, the indemnifying
party shall pay the costs and expenses of the indemnified party's
counsel in defending the Claim.
11. MISCELLANEOUS
(a) NOTICES. All notices, requests, demands and other communications
required or permitted to be given under this Agreement shall be in writing
and shall be deemed to have been properly delivered and received by each
party if delivered personally, by hand, or mailed first class, postage
prepaid, registered or certified mail, return receipt requested, or
delivered by courier or delivered by fax with confirmation of receipt, as
follows:
XXXXXXXX: XxxxXxxx Hospitality Corp.
0000 Xxxxxx Xxxxx Xxxxxxxxx, # 0000
Xxxxxx, Xxxxx 00000
Attn.: Xxxxxx X. Xxxxxxx, President
MSUSA: Miami Subs U.S.A., Inc.
0000 Xxxxxxxxx 00xx Xxxxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxx, Vice President and Chief Financial Officer
Any party hereto may change the address or addresses to which such
communications should be directed by giving written notice to the other
party of such change.
(b) ENTIRE AGREEMENT. This Agreement sets forth the entire agreement
and understanding of the parties in respect to the transactions
contemplated by it and supersedes any and all prior agreements and
understandings relating to the subject matter of this Agreement. No
representations, promises, inducement or statement of intention have been
made by XxxxXxxx to MSUSA that is not embodied in this Agreement or the
written statements or other documents delivered in connection with it or in
connection with the transactions contemplated by this Agreement. Without
limiting the foregoing, XxxxXxxx has made no representation to MSUSA about
the viability or future success of the business.
(c) SURVIVAL. The representations, warranties, obligations, covenants
and agreements of XxxxXxxx and MSUSA made herein shall survive the Closing
Date and shall be binding upon and shall inure to the benefit of the
parties and their successors, assigns, heirs and personal representatives.
(d) AMENDMENT. This Agreement may be amended, modified, superseded or
cancelled, and any of the terms, covenants, representations, warranties or
conditions hereof may be waived, only by a written instrument executed by
the parties or, in the case of a waiver, by the party waiving compliance.
(e) SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws, then (a)
such provision shall be fully severable and this Agreement shall be
construed and enforced as if such illegal, invalid or unenforceable
provision
10
were not a part hereof; (b) the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by such
illegal, invalid or unenforceable provision or by its severance from this
Agreement; and (c) there shall be added automatically as part of this
Agreement a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and still be legal, valid and
enforceable.
(f) FURTHER COOPERATION. The parties agree that they will, at any time
and from time to time after the Closing, promptly upon request by the other
and without further consideration, do, perform, execute, acknowledge and
deliver all such further acts, deeds, assignments, assumptions, transfers,
conveyances, powers of attorney, certificates and assurances as may be
reasonably required in order to fully consummate the transactions
contemplated hereby in accordance with this Agreement or to carry out and
perform any undertaking made by the parties hereunder.
(g) EXHIBITS. The exhibits to this Agreement referred to in this
Agreement and attached hereto are and shall be incorporated herein and made
a part hereof for all purposes as though set forth herein verbatim.
(h) APPLICABLE LAW. This Agreement and the rights and obligations of
the parties hereunder shall be governed by and construed in accordance with
the internal laws of the State of Texas, exclusive of its choice of law or
conflict of law rules.
(i) WAIVER. Any of the terms or conditions of this Agreement may be
waived at any time by the party that is entitled to the benefit thereof, by
action taken by the President or a Vice-President, or by the Board of
Directors of XxxxXxxx or MSUSA, respectively. Such action shall be
evidenced by a signed written notice given in the manner provided in
Section 11(a) hereof. No party to this Agreement shall by any act (except
by a written instrument given pursuant to Section 11(a) hereof) be deemed
to have waived any right or remedy hereunder or to have acquiesced in any
breach of any of the terms and conditions thereof. No failure to exercise,
nor any delay in exercising any right, power or privilege hereunder by any
party hereto shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power
or privilege. A waiver of any party of any right or remedy on any one
occasion shall not be construed as a bar to any right or remedy that such
party would otherwise have on any future occasion or to any right or remedy
that any other party may have hereunder.
(k) ATTORNEYS FEES. If any suit or action is brought to enforce any of
the terms of this Agreement or to enforce any of the obligations set forth
herein, the prevailing party in such suit or action, and in any appeal
therefrom, shall be entitled to recover reasonable attorneys fees and
costs. This paragraph shall survive the Closing.
(l) PRESS RELEASES. Neither party shall issue any press releases
concerning the transaction without the consent of the other, except as may
be required by law.
(m) TIME OF ESSENCE. Time is of the essence in this Agreement and
every provision contained herein.
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This Agreement is effective upon execution of all parties hereto as of the date
first above written.
MIAMI SUBS USA, INC., a XxxxXxxx Hospitality Corporation, a
Florida corporation Delaware corporation
By /s/ Xxxxx X. Xxxx By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------- -------------------------------------
Xxxxx X. Xxxx, Vice President Xxxxxx X. Xxxxxxx, President
LS Holding Corp., a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Xxxxxx X. Xxxxxxx, President
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