Exhibit 10.33
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AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
Bay Xxxxxxx Racecourse
San Mateo, California
SELLER: PATRIOT AMERICAN HOSPITALITY, INC.,
a Virginia corporation
BUYER: PW ACQUISITIONS IV, LLC,
a Delaware limited liability company
April 18, 1997
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
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THIS AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW INSTRUCTIONS ("Agreement")
is made and entered into as of April 18, 1997, and constitutes an agreement by
which PATRIOT AMERICAN HOSPITALITY, INC., a Virginia corporation ("Seller"),
agrees to sell, and PW ACQUISITIONS IV, LLC, a Delaware limited liability
company ("Buyer"), agrees to purchase the following:
A. Those certain parcels of land (the "Land") situated in the City
of San Mateo, State of California, more particularly described on Exhibit A
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attached hereto.
B. All rights, privileges, easements, and appurtenances to the Land
and any structures or other improvements situated on the Land (but specifically
excluding any structures or other improvements situated on that portion of the
Land which is (a) referred to as "Parcel Five" in the PTR (as defined in Section
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4 below) and (b) not a portion of said Parcel Five under contract to be sold
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pursuant to the "Franklin Contract" (as defined in Exhibit B) or the "Xxxxxxx
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Contract" (as defined in Exhibit B) (the "Improvements"), and specifically
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excluding, however, (i) any intangible property (including, without limitation,
the name "Bay Xxxxxxx") (except as specifically set forth herein) ("Intangible
Property"), and (ii) any personal property ("Personal Property"). The term
"Real Property" herein shall refer collectively to the Land, the Improvements,
and all such attendant rights, privileges, easements and appurtenances, but
shall specifically exclude Intangible Property, and Personal Property.
C. The Seller's interest in the contracts affecting the Real
Property which are listed on Exhibit B hereto (the "Contracts"), and the
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Seller's interest in any development agreement executed by Seller and the City
of San Mateo after the date hereof but prior to the closing of the transactions
contemplated hereby (the "Development Agreement").
The Real Property and the Contracts are collectively referred to herein as the
"Property."
The terms and conditions of this Agreement and the instructions to Chicago
Title Company (the "Escrow Holder" and "Title Company") with regard to the
escrow (the "Escrow") created pursuant hereto are as follows:
1. Purchase and Sale. For valuable consideration, the receipt and
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sufficiency of which are hereby acknowledged, Seller agrees to sell the Property
to Buyer, and Buyer agrees to purchase the Property from Seller, upon the terms
and conditions set forth herein.
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2. Purchase Price. The purchase price (the "Purchase Price") for the
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Property shall be Seventy Eight Million Fifty Thousand and 00/100 Dollars
($78,050,000.00), subject to any adjustments to the terms hereof, payable as
follows:
(a) Not later than April 30, 1997, Buyer shall deposit with Escrow Holder
the sum of One Million Dollars ($1,000,000.00), which sum shall be
invested by Escrow Holder in an interest-bearing account selected by
Buyer. Such sum plus all accrued interest thereon shall hereafter be
referred to as the "Deposit". The Deposit shall be applied toward
payment of the Purchase Price upon the "Close of Escrow" (as hereafter
defined).
(b) Upon the Close of Escrow, Buyer shall deposit or cause to be deposited
with Escrow Holder, in the form of a confirmed wire transfer of funds,
the balance of the Purchase Price plus such additional funds, if any,
as may be required to pay Buyer's share of prorations and closing
costs, as set forth herein.
3. Escrow.
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(a) Opening of Escrow. For the purposes of this Agreement, the Escrow
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shall be deemed opened (the "Opening of Escrow") on the date Escrow
Holder shall have received an executed counterpart of this Agreement
from both Buyer and Seller. Escrow Holder shall notify Buyer and
Seller, in writing, of the date Escrow is opened.
(b) Close of Escrow. For purposes of this Agreement, the "Close of
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Escrow" or "Closing" shall be defined as the date that the grant deed
(the "Grant Deed") conveying the Land to Buyer is recorded. The Escrow
shall close on the date that the Merger (as defined in Section 38
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below) closes, unless extended by mutual agreement of Buyer and Seller
("Closing Date"). On or before three (3) business days before the
scheduled Closing Date, Escrow Holder shall prepare a proforma closing
statement, setting forth the estimated adjustments and prorations as
of the scheduled Closing Date.
4. Condition of Title. It shall be a condition to Buyer's obligations
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hereunder that Title Company shall be committed to issue its ALTA Owner's
Extended Coverage Title Insurance Form B-1970 Policy together with such
endorsements as Buyer may reasonably require (the "Title Policy") in the amount
of the Purchase Price, showing fee title to the Land and Improvements vested in
Buyer, subject to the following (the "Condition of Title"):
(a) A lien to secure payment of real estate taxes, not delinquent;
(b) Matters affecting the Condition of Title created with the written
consent of Buyer; and
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(c) Exceptions disclosed by the current Preliminary Title Report (the
"PTR") with respect to the Land and Improvements issued by the Title
Company and dated March 13, 1997 (excluding the land described in the
PTR as "Parcel Two"), a copy of which is attached as Exhibit C hereto,
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which are approved pursuant to this section. Seller shall provide
Buyer with legible copies of the instruments underlying any exceptions
referred to in the PTR (the "Exceptions") within ten (10) days
following the Opening of Escrow, and an ALTA survey of the Land and
Improvements certified to Buyer and the Title Company (the "Survey")
within thirty (30) days following the Opening of Escrow (the PTR, the
Exceptions, and the Survey collectively referred to herein as the
"Title Documents"). Buyer shall have fifteen (15) days following the
delivery of the last of the Exceptions and the Survey to disapprove
any items set forth in the Title Documents. If Buyer fails to notify
Seller within such period, the Title Documents shall conclusively be
deemed approved. If Buyer disapproves any items described therein,
Seller shall thereafter have the right to attempt to eliminate or
ameliorate to Buyer's satisfaction such matters as Buyer shall have so
disapproved on or before the expiration of the Contingency Period.
Seller shall give written notice to Buyer within such period whether
Seller is unable or unwilling to eliminate such disapproved matters.
If Seller so notifies Buyer that it is unable or unwilling to
eliminate any such disapproved matters, Buyer shall have the right,
exercisable by written notice delivered to Seller and Escrow Holder on
or before the date that is fifteen (15) days following the delivery of
such notice, to: (i) waive its prior disapprovals of those matters
which Seller is unable to eliminate, in which event such disapproved
matters shall conclusively be deemed approved, or (ii) terminate the
Escrow, in which event the Deposit shall be returned to Buyer and
thereafter the Escrow, this Agreement and the rights and obligations
of the parties hereunder shall terminate; provided, however, that in
any event Seller shall be obligated to remove any monetary liens
against the Property prior to Closing.
5. Contingency Period. For a period commencing on the Opening of Escrow
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and terminating on the date of the consummation of the Merger (as defined in
Section 38 below) (the "Contingency Period"), Buyer shall have the right to
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satisfy itself that the physical and legal aspects of the Property are
acceptable to Buyer. Buyer's obligations hereunder shall be conditioned upon
Buyer's satisfaction with or waiver of such matters in its sole discretion. If
Buyer, at any time on or before the expiration of the Contingency Period, fails
to disapprove, in a writing delivered to Seller and Escrow Holder, the matters
set forth in this paragraph, then all of such matters shall conclusively be
deemed approved. If Buyer shall disapprove any such matter in a written notice
given to Seller and Escrow Holder prior to the end of the Contingency Period,
then this Agreement shall terminate, and neither party shall have any further
rights or obligations hereunder, provided that, (a) the Escrow Holder shall be
required to refund the Deposit to Buyer if Buyer shall have terminated this
Agreement (1) prior to May 27, 1997 due to the commencement (by such date) of
any appeal of the approval by the City of San Mateo of the Specific Plan or the
Environmental Impact Report relating to the proposed
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development of a portion of the Real Property, or (2) prior to the end of the
Contingency Period due to any act or omission by Cal Jockey that results in a
breach or default by Cal Jockey under the Franklin Contract or Xxxxxxx Contract
or that gives the purchaser under either the Franklin Contract or Xxxxxxx
Contract a right to terminate thereunder, and (b) if Buyer shall have terminated
this Agreement for any reason not set forth in the preceding clause (a) or in
any other Section of this Agreement, then the Escrow Holder shall pay the
Deposit to Seller, and Seller shall be entitled to retain the Deposit in such
case as fair and reasonable consideration for Seller's covenants and agreements
hereunder. During the term of the Escrow, Buyer, its agents, contractors and
subcontractors shall have the right to enter upon the Property at reasonable
times during ordinary business hours, upon reasonable prior notice to Seller and
subject to the rights of tenants under the Leases, to make any and all
inspections and tests as may be necessary or desirable in Buyer's judgment,
subject, however to the terms and conditions of the Acquisition Agreement (as
defined in Section 38 below). Buyer acknowledges and agrees that Seller shall
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be entitled to have its representatives present during any time Buyer or its
agents or independent contractors are on the Real Property. Buyer shall (i)
perform all work permitted under this Agreement in a safe and professional
manner, (ii) not create any dangerous or hazardous condition on the Real
Property, (iii) comply with all applicable laws with respect to Buyer's
inspections, and (iv) obtain all permits required to be obtained with respect to
Buyer's inspections. Any investigation which physically alters or changes the
condition of the Real Property in any material respect shall be subject to
Seller's prior approval, which approval shall not be unreasonably withheld or
delayed and also shall be subject to the Acquisition Agreement. Except as
expressly required by applicable law, Buyer shall (and shall request its agents
to) keep confidential the results and findings of Buyer's studies and
investigations of the Property. Buyer shall indemnify and hold Seller harmless
from damages resulting from Buyer's entry and/or activities upon the Real
Property by Buyer, its agents, contractors and/or subcontractors, except to the
extent any such damages are the result of Seller's negligence.
6. Estoppel Certificates. Seller shall use reason-able efforts to cause
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Cal Jockey (as defined in Section 38 below) to obtain from each of the
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respective other parties to the Contracts and deliver to Buyer on or before the
date that is ten (10) days prior to the originally scheduled Closing Date a duly
executed estoppel certificate stating that no default exists under the
applicable Contract (the "Estoppel Certificate(s)"). The Estoppel Certificates
shall be initially pre-pared by Seller, shall be approved by Buyer, and shall be
dated no earlier than thirty (30) days prior to the originally scheduled Closing
Date.
7. Racecourse Leases. During the Contingency Period, Seller and Buyer
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shall use reasonable good faith efforts to negotiate the form of the following
documents: (a) a new lease (the "Racecourse Lease"), containing the terms and
conditions set forth on the schedule attached hereto as Exhibit D and containing
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other reasonable and customary terms for such a lease covering the portion of
the Property designated as the "Main Track & New Barns" on the diagram attached
hereto as Schedule D-l the "Racecourse Parcel"); (b) a lease or other agreement
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providing for the temporary use of the land and existing facilities on the
portion of the Property designated as the "Stables and Training Area" during
the construction of new
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stables facilities on the Racecourse Parcel (the "Temporary Stables Lease"); and
(c) a lease or other agreement leasing to Seller at a quarterly rental of Seven
Thousand Five Hundred and 00/100 Dollars ($7,500.00), cancelable on ninety (90)
days notice, that portion of the Property commonly known as the Sun-down Tennis
Club and more fully described as "Parcel One" in the PTR (the "Temporary Tennis
Club Lease"). (The Racecourse Lease, the Temporary Stables Lease, and the
Temporary Tennis Club Lease are collectively referred to hereinafter as the "New
Leases".) Concurrently with Closing, Seller shall terminate the existing lease
between Seller and BMOC dated March 29, 1993 covering the Racecourse Parcel (the
"Old Lease") and shall cause BMOC to enter into a Termination and Release
Agreement in connection therewith, and also concurrently with Closing, Seller
and Buyer shall enter into the New Leases.
8. Buyer's Representations and Warranties. Buyer makes the following
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representations and warranties to Seller:
(a) This Agreement has been duly and validly authorized, executed and
delivered by Buyer and no other action is requisite to the valid and
binding execution, delivery and performance of this Agreement by
Buyer. Other than as disclosed to Seller, no consents or waivers of or
by any third party are necessary to permit the consummation by Buyer
of the transactions contemplated pursuant to this Agreement. At all
times during the pendency of this Agreement, Buyer shall be a legal
entity duly incorporated or organized, validly existing and in good
standing under the laws of its incorporation or organization, and
shall have the requisite power and authority and all governmental
permits, approvals and authorizations necessary to own, lease and
operate its properties and to carry on its business as it is now being
conducted. Buyer has the financial ability to perform all of its
obligations under this Agreement.
(b) Buyer has not: (i) made a general assignment for the benefit of
creditors, (ii) filed any voluntary petition in bankruptcy or suffered
the filing of any involuntary petition by Buyer's creditors, (iii)
suffered the appointment of a receiver to take possession of all or
substantially all of Buyer's assets, (iv) suffered the attachment or
other judicial seizure of all, or substantially all, of Buyer's
assets, (v) admitted in writing Buyer's inability to pay its debts as
they come due, or (vi) made an offer of settlement, extension, or
composition to its creditors generally.
9. Seller's Representations and Warranties. Solely as a condition of
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Buyer's obligation to consummate the transactions contemplated by this
Agreement, Seller makes the following representations and warranties to Buyer:
(a) This Agreement has been duly and validly authorized, executed and
delivered by Seller and no other action is requisite to the valid and
binding execution, delivery and performance of this Agreement by
Seller. Other than as disclosed
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to Buyer, no consents or waivers of or by any third party are
necessary to permit the consummation by Seller of the transactions
contemplated pursuant to this Agreement. At all times during the
pendency of this Agreement, Seller shall be a legal entity duly
incorporated or organized, validly existing and in good standing under
the laws of its incorporation or organization, and shall have the
requisite power and authority and all governmental permits, approvals
and authorizations necessary to own, lease and operate its properties
and to carry on its business as it is now being conducted.
(b) Except as disclosed in writing to Buyer, to the best of Seller's
knowledge, there are no actions, suits or proceedings pending against
the Property, nor pending proceedings in eminent domain or otherwise
which would affect the Property or any portion thereof.
(c) Except as disclosed in writing to Buyer, to the best of Seller's
knowledge, the Property is in compliance with all applicable laws,
statutes, ordinances and regulations, whether federal, state or local
(including those applicable to zoning, environmental conditions and
racing).
(d) Except as disclosed on Exhibit B attached hereto, there are no
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agreements affecting or relating to the right of any party with
respect to possession of the Property, or any portion thereof, which
are obligations which will affect the Property or any portion thereof
subsequent to the recordation of the Deed, except as set forth in the
Contracts or as may be reflected in the Condition of Title. Buyer
expressly acknowledges the existence of the Contracts.
(e) Seller is not a "foreign person" within the meaning of Section 1445 et
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seq. of the Internal Revenue Code of 1986, as amended.
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(f) Seller has not: (i) made a general assignment for the benefit of
creditors, (ii) filed any voluntary petition in bankruptcy or suffered
the filing of any involuntary petition by Seller's creditors, (iii)
suffered the appointment of a receiver to take possession of all or
substantially all of Seller's assets, (iv) suffered the attachment or
other judicial seizure of all, or substantially all, of Seller's
assets, (v) admitted in writing Seller's inability to pay its debts as
they come due, or (vi) made an offer of settlement, extension, or
composition to its creditors generally.
The term "best of Seller's knowledge," when used in this Agreement, shall
mean only such information as has actually been communicated to or learned by
Xxxxxxx X. Xxxxx III or Xxxxxx Xxxxxxx, without imputing to such persons the
knowledge of any other person or entity. The persons named above are the persons
employed by Seller with primary responsibility for the operation and management
of the Property and such persons have reviewed the representations and
warranties made by Seller herein.
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If prior to the Close of Escrow Seller becomes aware of any fact or
circumstance which changes a representation or warranty, Seller shall promptly
give written notice of such fact or circumstance to Buyer. Upon notification of
any fact or circumstance which changes any representation or warranty contained
herein, Buyer shall have the option of: (a) waiving the breach of warranty that
would be caused by such change, or (b) terminating this Agreement, whereupon the
Escrow Holder shall promptly return the Deposit to Buyer and neither party shall
have any further rights or obligations hereunder. If Buyer does not so
terminate this Agreement and closes this transaction, Buyer shall be deemed to
have waived the failure of such condition or breach of such representation or
warranty. Seller's representations and warranties set forth above shall not
survive the Close of Escrow.
Buyer acknowledges and agrees that, except as expressly provided in this
Section 9, Seller has not made, does not make and specifically disclaims any
representations, warranties, promises, covenants, agreements or guaranties of
any kind or character whatsoever, whether express or implied, oral or written,
past, present or future, of, as to, concerning or with respect to: (a) the
nature, quality or condition of the Property, including, without limitation, the
water, soil and geology, (b) the income to be derived from the Property, (c) the
suitability of the Property for any and all activities and uses which Buyer may
conduct thereon, (d) the compliance of or by the Property or its operation with
any laws, rules, ordinances or regulations of any applicable governmental
authority or body, (e) the habitability, merchantability or fitness for a
particular purpose of the Property, or (f) any other matter with respect to the
Property. Without limiting the foregoing, except as expressly provided in this
paragraph, Seller does not and has not made any representation or warranty
regarding the presence or absence of any hazardous substances in, on, under or
about the Property or the compliance or noncompliance of the Property with the
Comprehensive Environmental Response, Compensation and Liability Act, the
Superfund Amendment and Reauthorization Act, the Resource Conversation Recovery
Act, the Federal Water Pollution Control Act, the Federal Environmental
Pesticides Act, the Clean Water Act, the Clean Air Act, any so called federal,
state or local "superfund" or "superlien" statute, or any other statute, law,
ordinance, code, rule, regulation, order or decree regulating, relating to or
imposing liability or standards of conduct concerning any hazardous substances.
Buyer further acknowledges and agrees that, except as expressly provided in this
Section 9, having been given the opportunity in this Agreement to inspect the
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Property, Buyer will be purchasing the Property pursuant to its independent
examination, study, inspection and knowledge of the Property and Buyer will rely
upon its own determination of the value of the Property and uses to which the
Property may be put, and not on any information provided or to be provided by
Seller. Buyer acknowledges receipt of the Property Documents and agrees that
Buyer will have reviewed such Property Documents prior to closing the
transactions contemplated hereby. Buyer further acknowledges and agrees that no
representation or warranty respecting the accuracy or completeness of any
information provided or to be provided with respect to the Property from third
party sources (although Seller has no reason to doubt such accuracy) and that
Seller has not made and is not obligated to make any independent investigation
or verification of such information. The occurrence of the Closing shall
constitute an acknowledgment by Buyer that, except as expressly provided in this
paragraph, the Property was accepted without representation or
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warranty, express or implied, and otherwise in an "as is", "where is", and "with
all faults" condition based solely upon Buyer's own inspections.
10. Covenants and Interim Responsibilities of Seller. Seller agrees that
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during the period between the Opening of Escrow and the Closing, Seller shall
use reasonable efforts (subject to any limitations set forth in the Merger
Agreement) to cause Cal Jockey:
(a) Affirmative Covenants. To (i) maintain Cal Jockey's existing
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insurance policies for the Property, (ii) perform all of Cal Jockey's
obligations under the Contracts and any and all other contracts and
agreements affecting the Property, (iii) comply with all applicable
laws, ordinances, rules, regulations and requirements affecting the
Property, and (iv) commence the construction of the improvements to
the Property required by the Entitlements (as defined in Section 39)
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and/or necessary to achieve the development contemplated under the
Contracts (which reasonable efforts shall not include lending money to
Cal Jockey for such work, indemnifying Cal Jockey for the costs of
such work, incurring any other costs or commencing litigation).
(b) Negative Covenants. To refrain from, without Buyer's prior written
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consent, which shall not be unreasonably withheld, delayed or
conditioned: (i) executing any new lease or materially modify any
existing lease affecting the Property, (ii) entering into any new
contract or materially modifying any existing Contract with respect to
the Property which will survive Closing, (iii) removing any Personal
Property from the Property unless replaced by Personal Property of
equal or greater utility and value, or (iv) alienating, placing a lien
upon, allowing a lien to be placed upon, encumbering or otherwise
transferring the Property or any interest therein.
11. Conditions of Closing.
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(a) Buyer's obligation to close this transaction shall be subject to the
occurrence and/or satisfaction of the following conditions:
(i) The Merger (as defined in Section 38 below) shall have been
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consummated.
(ii) The Title Company is committed to issue the Title Policy
insuring title to the Property vested in Buyer or its nominee
in the amount of the Purchase Price in the approved Condition
of Title.
(iii) As of the Close of Escrow, Seller shall have performed all of
the obligations required to be performed by Seller under this
Agreement.
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(iv) All representations and warranties made by Seller to Buyer in
this Agreement shall be materially true and correct as of the
Close of Escrow.
(v) The Old Lease shall have been terminated and the New Leases
shall have been executed.
(vi) Seller shall have obtained all consents, waivers, and other
approvals necessary for Seller to con-summate the transactions
contemplated hereby.
(vii) Buyer shall not have exercised its right to terminate this
Agreement under Section 5 above.
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(b) Seller's obligation shall be subject to the occurrence and/or
satisfaction of the following conditions:
(i) The Merger shall have been consummated.
(ii) As of the Close of Escrow, Buyer shall have performed all of
the obligations required to be performed by Buyer under this
Agreement.
(iii) All representations and warranties made by Buyer to Seller in
this Agreement shall be materially true and correct as of the
Close of Escrow (but without regard to the knowledge
qualifications set forth therein).
(iv) Buyer shall have obtained all consents, waivers, and other
approvals necessary for Buyer to consummate the transactions
contemplated hereby.
(v) The Old Lease shall have been terminated and the New Leases
shall have been executed.
12. Deposits By Seller. Prior to the scheduled Closing Date, Seller shall
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deliver to Escrow Holder for recordation or delivery to Buyer upon the Close of
Escrow, the following documents and instruments, fully executed and acknowledged
where appropriate:
(a) The Grant Deed in a form approved by Buyer, Seller, and Title Company.
(b) The New Leases.
(c) A Memorandum of Lease with respect to the Racecourse Lease (the
"Memorandum of Lease").
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(d) An assignment and assumption of the Contracts in the form attached
hereto as Exhibit E (the "Assignment of Contracts").
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(e) An assignment of the Development Agreement (if applicable) in a form
mutually acceptable to Seller and Buyer in their reasonable discretion
(the "Assignment of Development Agreement") providing for the
assignment and assumption of Seller's rights and obligations under the
Development Agreement.
Seller also shall cause to be transferred to Buyer Seller's interest in all good
faith, xxxxxxx money, and other similar deposits made pursuant to the Contracts.
13. Deposits By Buyer. Buyer shall deposit with Escrow Holder the funds
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which are to be applied towards the payment of the Purchase Price in the amounts
and at the times designated herein, and such other amounts as are required on
account of Buyer's share of closing costs or prorations, as set forth herein. In
addition, at least two (2) business days prior to the scheduled Closing Date,
Buyer shall execute and acknowledge (where appropriate) and deposit with Escrow
Holder for delivery to Seller upon the Close of Escrow counterparts of the New
Leases, the Memorandum of Lease, the Assignment of Contracts and (if
applicable) the Assignment of Development Agreement.
14. Costs and Expenses. Seller and Buyer shall each pay one-half of the
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cost and expenses of this transaction; provided, however, that Seller shall pay
all of the fees and costs due to its counsel, Xxxxxxx, Procter & Xxxx LLP, and
Buyer shall pay all of the fees and costs due to its counsel, Wachtell, Lipton,
Xxxxx & Xxxx.
15. Prorations. The following items shall be prorated by Escrow Holder
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as of the Close of Escrow:
(a) Real property taxes with respect to the Land and Improvements and
personal property taxes based upon the latest available tax
information shall be prorated to the Close of Escrow.
(b) Utilities, services and operating expenses with respect to the Land
and the Improvements shall be prorated to the Close of Escrow based
upon the latest available information.
(c) Premiums for casualty and liability insurance shall not be prorated as
Buyer will obtain its own such insurance upon the Close of Escrow.
If any errors or omissions are made regarding adjustments and prorations as
set forth above, the parties shall make the appropriate corrections promptly
upon the discovery thereof.
16. Disbursements and Other Actions by Escrow Holder. Upon the Close of
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Escrow, Escrow Holder shall promptly undertake all of the following in the
manner indicated:
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(i) Cause the Deed to be recorded in the Official Records of San
Mateo County.
(ii) Disburse all funds deposited with Escrow Holder by Buyer towards
payment of the Purchase Price for the Property as follows:
(A) Deduct therefrom sums required to pay the closing costs of
Buyer.
(B) Disburse therefrom the sum required to pay to Seller the
amount of the Purchase Price, less sums necessary to pay
the closing costs of Seller.
(C) Disburse the balance, if any, to Buyer.
(iii) Deliver the Title Policy to Buyer.
(iv) Deliver the Xxxx of Sale, General Assignment, and counterparts of the
New Leases and the Assignment of Contracts executed by Seller to
Buyer.
(v) Deliver counterparts of the New Leases and the Assignment of
Contracts, executed by Buyer to Seller.
(vi) Deliver to both Buyer and Seller copies of all other documents
delivered to either party hereto or recorded pursuant to this
Agreement.
17. [Intentionally omitted.]
18. Partial Invalidity. If any portion of this Agreement shall be
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declared by any court of competent jurisdiction to be invalid, illegal or
unenforceable, such portion shall be deemed severed from this Agreement and the
remaining parts hereof shall remain in full force and effect as fully as though
such invalid, illegal or unenforceable portion had never been part of this
Agreement.
19. Attorneys' Fees. In the event of the bringing of any action or suit
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by a party hereto against another party hereto by reason of any breach of any of
the covenants or agreements or any inaccuracies in any of the representations
and warranties on the part of the other party arising out of this Agreement,
then, in that event, the prevailing party in such action or dispute, whether by
final judgment or out-of-court settlement, shall be entitled to have and recover
of and from the other party all costs and expenses of suit, including actual
attorneys' fees.
20. Notices. All notices or other communications required or permitted
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hereunder shall be in writing and shall be personally delivered or sent by
registered or certified mail,
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postage prepaid, return receipt requested, delivered or sent by telex, telecopy,
cable or via a reliable overnight courier such as Federal Express, and shall be
deemed received upon the earlier of: (a) if personally delivered or via
overnight courier, the date of delivery to the address of the person to receive
such notice, or (b) if mailed, upon the date of receipt as disclosed on the
return receipt.
To Seller: Patriot American Hospitality, Inc.
0000 XXX Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xx. Xxxx X. Xxxxxxxx
and Xx. Xxxxxx Xxxxxxx
Telecopy: (000) 000-0000
And a copy to: Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
To Buyer: PW Acquisitions IV, LLC
c/o PaineWebber Incorporated
1295 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxx Xxxxxxxx
Telecopy: (000) 000-0000
With a copy to: Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx, Esq.
Telecopy: (000) 000-0000
To Escrow Holder: Chicago Title Company
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
13
In addition, a copy of any notice to any party hereunder shall be delivered to:
Xxxxxx & Xxxxx LLP
Xxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
Notice of change of address shall be given by written notice in the manner
detailed in this paragraph. Rejection or other refusal to accept or the
inability to deliver because of changed address of which no notice was given
shall be deemed to constitute receipt of the notice, demand, request or
communication sent.
21. No Brokers. Seller represents and warrants to Buyer, and Buyer
----------
represents and warrants to Seller, that no broker or finder has been engaged by
it, respectively, in connection with any of the transactions contemplated by
this Agreement or, to its knowledge, is in any way connected with any of such
transactions. In the event of any such additional claims for brokers, or
finders, fees for the consummation of this Agreement, then Buyer shall
indemnify, save harmless and defend Seller from and against such claims if they
shall be based upon any statement or representation or agreement by Buyer, and
Seller shall indemnify, save harmless and defend Buyer if such claims shall be
based upon any statement, representation or agreement made by Seller. The
foregoing indemnities shall survive the Close of Escrow or any termination of
this Agreement.
22. Required Actions of Buyer and Seller. Buyer and Seller agree to
------------------------------------
execute such instruments and documents and to diligently undertake such actions
as may be required in order to consummate the purchase and sale herein
contemplated and shall use their good faith to accomplish the Close of Escrow in
accordance with the provisions hereof.
23. Time of Essence. Time is of the essence of each and every term,
---------------
condition, obligation and provision hereof.
24. Counterparts. This Agreement may be executed in multiple
------------
counterparts, each of which shall be deemed an original, but all of which,
together, shall constitute one and the same instrument.
25. Captions. Any captions to, or headings of, the sections, paragraphs
--------
or subparagraphs of this Agreement are solely for the convenience of the parties
hereto, are not a part of this Agreement, and shall not be used for the
interpretation or determination of the validity of this Agreement or any
provision hereof.
26. No Obligations to Third Parties. The execution and delivery of this
-------------------------------
Agreement shall not be deemed to confer any rights upon, nor obligate any of the
parties hereto, to any person or entity other than the parties hereto.
14
27. Exhibits. The exhibits attached hereto are incorporated herein by this
--------
reference.
28. Amendment to this Agreement. The terms of this Agreement may not be
---------------------------
modified or amended except by an instrument in writing executed by each of the
parties hereto.
29. Waiver. The waiver or failure to enforce any provision of this
------
Agreement shall not operate as a waiver of any future breach of any such
provision or any other provision hereof.
30. Applicable Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of California.
(Remainder of page intentionally left blank)
15
31. [Intentionally Omitted.]
32. Entire Agreement. This Agreement supersedes any prior agreements,
----------------
negotiations and communications, oral or written, and contains the entire
agreement between Buyer and Seller as to the subject matter hereof. No
subsequent agreement, representation or promise made by either party hereto, or
by or to an employee, officer, agent or representative of either party, shall be
of any effect unless it is in writing and executed by the party to be bound
thereby.
33. Successors and Assigns. This Agreement and all of the terms,
----------------------
conditions and provisions hereof shall inure to the benefit of and be binding
upon the respective successors. and assigns of the parties hereto. Neither
party hereto shall assign its rights or obligations hereunder without the prior
written consent of the other.
34. Default.
-------
(a) If any of Seller's representations and warranties contained
herein shall not be materially true and correct, or if Seller
shall have materially failed to perform any of the covenants and
agreements contained herein to be performed by Seller within the
time for performance as specified herein, Buyer may elect as
Buyer's sole and exclusive remedy hereunder, to either: (i)
terminate Buyer's obligations under this Agreement by written
notice to Seller with a copy to Escrow Holder whereupon Escrow
Holder shall refund the Deposit to Buyer, and neither party shall
have any further rights or obligations hereunder, or (ii) file an
action for specific performance of the conveyance described in
this Agreement.
(b) UPON EXPIRATION OF THE CONTINGENCY PERIOD AND BUYERS APPROVAL OF
THE MATTERS SET FORTH ABOVE, IF BUYER COMMITS A DEFAULT UNDER
THIS AGREEMENT AND FAILS TO PURCHASE THE PROPERTY, THEN, IN ANY
SUCH EVENT, ESCROW HOLDER MAY BE INSTRUCTED TO CANCEL THE ESCROW
AND SELLER SHALL THEREUPON BE RELEASED FROM ITS OBLIGATIONS
HEREUNDER. BUYER AND SELLER AGREE THAT IT WOULD BE IMPRACTICAL OR
EXTREMELY DIFFICULT TO FIX ACTUAL DAMAGES IN THE CASE OF BUYERS
DEFAULT AND FAILURE TO PURCHASE THE PROPERTY, THAT THE DEPOSIT IS
A REASONABLE ESTIMATE OF SELLERS DAMAGES IN SUCH EVENT
("LIQUIDATED DAMAGES"), AND THAT IN THE EVENT OF A BREACH BY
BUYER AS DESCRIBED ABOVE, THE ESCROW HOLDER, UPON INSTRUCTIONS TO
DO SO, SHALL DISBURSE THE DEPOSIT TO SELLER AND SHALL CANCEL THE
ESCROW CREATED PURSUANT HERETO, IN WHICH EVENT SELLER AND BUYER
16
SHALL BE RELIEVED FROM ALL LIABILITY HEREUNDER. RECEIPT OF THE
DEPOSIT AS LIQUIDATED DAMAGES SHALL BE SELLER'S SOLE AND
EXCLUSIVE REMEDY IN THE EVENT OF A BREACH BY BUYER AS DESCRIBED
ABOVE AND SELLER HEREBY WAIVES ANY RIGHT TO COMPEL SPECIFIC
PERFORMANCE OF THIS AGREEMENT BY BUYER. ESCROW HOLDER IS HEREBY
RELEASED FROM ANY AND ALL LIABILITY WITH REGARD THERETO. SELLER
AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE
PROVISIONS OF THIS PARAGRAPH AND BY THEIR INITIALS IMMEDIATELY
BELOW AGREE TO BE BOUND BY ITS TERMS.
Seller's Initials Buyer's Initials
/s/ WE /s/ TF
------------------ ----------------
35. Computation of Periods. All periods of time referred to in this
----------------------
Agreement shall include all Saturdays, Sundays and national holidays, unless the
period of time specifies business days; provided, however, that if the date to
perform any act or give a notice with respect to this Agreement shall fall on a
Saturday, Sunday or national holiday, such act or notice may be timely performed
on the next succeeding day which is not a Saturday, Sunday or a national
holiday.
36. Recourse. The obligations and liabilities of the parties under this
--------
Agreement and the exhibits attached hereto are intended to be binding only on
the respective parties and shall not be personally binding upon, nor shall any
resort be had to, the private properties of any of the parties, officers,
directors, trustees or shareholders, or of their investment managers, general
partners, officers, directors, trustees or shareholders thereof, or any
employees or agents of the parties or their respective investment managers.
37. Termination of Merger Agreement. In the event the Merger Agreement is
-------------------------------
terminated by the parties thereto without the consummation of the Merger, this
Agreement shall terminate automatically, whereupon the Escrow Holder shall
promptly return the Deposit to Buyer and neither party shall have any further
rights or obligations hereunder.
38. Compliance With Acquisition and Merger Agreements. The parties
-------------------------------------------------
acknowledge and agree that as of the date hereof and until the consummation of
the Merger (as defined below), the Property is and shall be owned by California
Jockey Club, a Delaware corporation ("Cal Jockey"), an entity which is not
affiliated with Seller. Seller is a party to that certain "Acquisition
Agreement" by and among Seller, Cal Jockey, and Bay Xxxxxxx Operating Company, a
Delaware corporation ("BMOC"), dated as of October 31, 1996 (the "Acquisition
Agreement") and that certain "Agreement and Plan of Merger" dated as of February
24, 1997 by and among Seller, Cal Jockey and BMOC (the "Merger Agreement"),
17
and Seller's rights and interests in the Property are as set forth in the
Acquisition Agreement and the Merger Agreement. Upon consummation of the
transactions contemplated by the Acquisition Agreement and the Merger Agreement
(the "Merger"), Seller will be the legal owner of the Property, however until
the consummation of the Merger and notwithstanding anything to the contrary set
forth in this Agreement, all of the terms and conditions hereof (including,
without limitation, the right to inspect the Property) shall be subject to the
provisions and limitations of the Acquisition Agreement and the Merger
Agreement.
39. Joint Due Diligence; Cooperation With Respect to Entitlements. Seller
-------------------------------------------------------------
and Buyer acknowledge that they are jointly performing due diligence
investigations of the Property and have jointly retained attorneys and other
consultants in connection with such joint due diligence. In this regard, Seller
and Buyer agree that Seller and Buyer shall each cooperate in good faith to
agree on the necessary efforts with respect to due diligence, shall each
promptly provide to the other copies of any due diligence reports or other
information received by them, and shall each pay one half of the costs
associated with all mutually agreed-upon due diligence efforts. Seller and
Buyer also agree to cooperate in good faith with respect to providing mutual
guidance and direction to Cal Jockey in connection with Cal Jockey's current
efforts to secure approval of the Bay Xxxxxxx Specific Plan and the other
entitlements related thereto. Provided, however, that none of the provisions of
this Section 39 shall be construed to limit or diminish Buyer's agreement to
----------
Seller's disclaimers and acknowledgments with respect to the condition of the
Property set forth in the final paragraph of Section 9 above.
---------
40. 1031 Exchange. Notwithstanding anything in this contract to the
-------------
contrary, Seller may, upon reasonable prior written notice to Buyer, assign this
Agreement to sell the Property as part of a tax deferred exchange under the
provisions of section 1031 of the Internal Revenue Code and the regulations
promulgated thereunder. Buyer agrees to assist and cooperate in such exchange,
and further agrees to execute (subject to Buyer's reasonable approval) all
reasonable, customary documents necessary in connection with any such tax free
exchange and otherwise to cooperate reasonably in connection with such an
exchange, all at no cost or expense to Buyer. Seller may be assigning all
contract rights and/or obligations hereunder to a "qualified intermediary" as
that term is defined in the Internal Revenue Code and relevant Treasury
regulations. As part of such exchange, Seller may convey the Property directly
to Buyer or Buyer's nominee and Buyer shall not be obligated to acquire or
convey any other property as part of such exchange.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first set forth above.
SELLER
------
PATRIOT AMERICAN HOSPITALITY,
INC., a Virginia corporation
By: /s/ Xxxxxxx X. Xxxxx III
----------------------------
Its:
---------------------------
BUYER
-----
PW ACQUISITIONS IV, LLC,
a Delaware limited liability company
By: PW Realty Partners, LLC, as
Managing Member
By: PW Acquisitions Corp., as
Managing Member
By: /s/ Xxxxxxxx X. Xxxxxxx
----------------------------
Name:
--------------------------
Its:
---------------------------
ESCROW HOLDER APPROVES THE ESCROW
PROVISIONS AND SPECIFIC INSTRUCTIONS
TO ESCROW HOLDER SET FORTH IN THE
FOREGOING AGREEMENT AND AGREES TO
ACT IN ACCORDANCE THEREWITH.
CHICAGO TITLE COMPANY
By:
----------------------------------------------
Its:
---------------------------------------------
Date: , 1997
----------------------------
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