Exhibit 10.17
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AGREEMENT
The parties to this Agreement are Xxxxx X. Xxxxx ("Shine"), Xxxxxxxx'x
Family Restaurants, Inc. ("Xxxxxxxx'x"), and ELXSI. The parties mutually desire
to resolve certain issues and claims between them arising out of or relating to
(i) a certain letter agreement between Shine and ELXSI (and others) dated
December 11, 2001 (the "2001 Agreement"), and (ii) that litigation captioned
Xxxxx X. Xxxxx v., Xxxxxxxx'x Family Restaurants, Inc. and ELXSI and having
Middlesex Superior Court Docket No. 02-04975 (the "litigation").
Accordingly, the parties make the representations, promises,
agreements, and undertakings set forth below.
1. ELXSI shall (i) continue to make all payments of interest in the
amounts, and at the times, due under the 2001 Agreement for the duration of this
Agreement, and (ii) pay all other amounts when due under this Agreement.
2. The parties will execute and file, in substantially the form
attached hereto as Exhibit "A", a stipulation dismissing with prejudice the
Counterclaim filed by Xxxxxxxx'x and ELXSI in the litigation.
3. The parties will sign and file, in substantially the form attached
hereto as Exhibit "B", a stipulation waiving and dismissing with prejudice the
affirmative defenses labeled First through Seventh in the Answer filed by
Xxxxxxxx'x and ELXSI in the litigation.
4. Except as provided in this Agreement, the parties agree that the
litigation will proceed in the ordinary fashion, with the parties using their
best efforts to maintain the litigation pending in Middlesex Superior Court,
within good faith adherence to the rules of that Court, deferring any final
adjudication until March 1, 2007 or such earlier date as may be required by the
Court. After such date, Shine shall be free to seek a judgment in the litigation
and enforce any resulting execution without further notice or delay.
5. Shine will file and present in the litigation, in substantially the
form attached hereto as Exhibit "C", a motion for real estate attachment in the
amount of $784,589 on specified and agreed real and personal property owned by
Xxxxxxxx'x and located in Kingston, Massachusetts (the "Kingston property");
Xxxxxxxx'x and ELXSI will provide Shine, in advance of the filing of the motion
for attachment on the Kingston property, with written assents by their counsel
to the granting of that motion.
6. At least 90 days after the recording of the writ of attachment on
the Kingston property in the Plymouth County Registry of Deeds, but no more than
120 days after that event, and provided that no default with respect to the
obligations of Bickfords or ELXSI shall have occurred under this Agreement,
Shine will execute and deliver to Xxxxxxxx'x and ELXSI; (i) a discharge, in
substantially the form attached hereto as Exhibit "D", of the attachment granted
him in this action on December 3, 2002 as it pertains to real property owned by
Xxxxxxxx'x in Burlington and Waltham, Massachusetts, and (ii) an executed
authorization to be countersigned by ELXSI and Xxxxxxxx'x and delivered to the
Escrow Agent under the Escrow Agreement attached hereto as Exhibit "E",
permitting the release of the escrow funds held thereunder to Bank of America.
7. Any breach by Xxxxxxxx'x or ELXSI of any of their representations,
warranties, promises, agreements or undertakings in this Agreement shall make
Shine's obligations under this Agreement void and of no effect, and Shine may
thereafter, at his discretion, among other available remedies for such breach,
seek a judgment in the litigation and enforce any resulting execution without
further notice or delay.
8. Xxxxxxxx'x and ELXSI represent and warrant that (i) the Kingston
property has a current assessed value of $767,000 (pursuant to the current tax
xxxx for the Kingston Property), and that (ii) the sole encumbrance presently of
record as to the Kingston property is a mortgage given by Xxxxxxxx'x to Citizens
Bank in the current outstanding principal balance of approximately $338,938.54
(the "Citizens' mortgage").
9. Bickfords and ELXSI represent and warrant that they will not
voluntarily encumber, nor suffer any involuntary encumbrance upon, the Kingston
property at any time after the date of this Agreement, other than (i) to permit
the recording of the new attachment referenced in paragraph 5 above at the
Plymouth County Registry of Deeds, or (ii) as permitted in paragraphs 10 and 11
below.
10. Xxxxxxxx'x and ELXSI covenant and agree that, if the current
Citizens' mortgage encumbering the Kingston property is refinanced, (i) the new
principal balance of such refinanced mortgage will not exceed its present
principal, and (ii) it will incorporate amortization terms substantially the
same as provided in the Citizen's mortgage and the note secured thereby.
11. Any default by Xxxxxxxx'x or ELXSI under the Citizens' mortgage, or
under any related instrument of financial obligation (including, any refinancing
thereof permitted under this Agreement), which default continues beyond any
applicable period of notice and/or grace, if any, shall constitute a default by
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such parties under this Agreement and make Shine's obligations under this
Agreement void and of no effect, and Shine may thereafter, at his discretion,
seek judgment in the litigation and enforce any resulting execution without
further notice or delay.
12. ELXSI and Xxxxxxxx'x hereby make the following additional
representations and warranties to and for the benefit of Shine:
A. Due Diligence Deliveries. Simultaneously with or prior to the
execution of this Agreement, ELXSI and Xxxxxxxx'x have provided Shine with true
and correct copies of each of the following items:
(i) the most recent title insurance policy, in Xxxxxxxx'x and/or
ELXSI's possession or control, showing title to the Kingston property.
The foregoing title insurance policy shall be updated and endorsed
through the date of the recording of the writ of attachment against the
Kingston property contemplated by paragraph 5 above, at Xxxxxxxx'x
and/or ELXSI's expense, to confirm that title to the Kingston property
is as warranted in this Agreement.
(ii) all existing environmental assessment reports, or other
reports regarding the possible presence of hazardous materials on, or
in the vicinity of, the Kingston property, in Xxxxxxxx'x and/or ELXSI's
possession or control.
(iii) the most recent surveys, or other plans (including any
building plans) depicting the Kingston property, in Xxxxxxxx'x and/or
ELXSI's possession or control.
(iv) the Citizens' mortgage and the note secured thereby.
(v) the most current appraisal and copies of all other existing
appraisals of the Kingston property in Xxxxxxxx'x or ELXSI's possession
or control.
(vi) the so-called "Sign Agreement" relating to the sign shared
with the adjacent motel operator, together with all other contracts
relating to the use, maintenance, and other aspects of the operation of
the Kingston property.
Except as disclosed in the foregoing items, neither ELXSI nor
Xxxxxxxx'x has any knowledge of (i) any hazardous materials being present at the
Kingston property, (ii) any other condition that might adversely affect the
current use or operation of the Kingston property in any material manner, or
(iii) any other condition, circumstances or other event that might adversely
affect the value of the Kingston property.
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B. Compliance with Law. Neither Xxxxxxxx'x nor ELXSI has received any
notice that Kingston property, as presently constructed or used, violates any
applicable Federal or state law or governmental regulation or any local
ordinance, order or regulation including, but not limited to, laws, regulations
or ordinances relating to use and occupancy, subdivision control, fire
protection, health, sanitation and protection of the environment. Neither ELXSI
nor Xxxxxxxx'x has received any notice that the Kingston property fails to
comply with any zoning laws or regulations or that any such zoning laws or
regulations do not permit the use of the Kingston property as presently used.
C. Proceedings. Neither Xxxxxxxx'x nor ELXSI has received any notice of
any actions or proceeding instituted or pending before any court, administrative
agency or arbitrator against either Xxxxxxxx'x or ELXSI, or otherwise relating
to the Kingston property (including, in particular without limitation, any
eminent domain or condemnation proceedings), and to the best of such party's
knowledge, there are no such actions or proceedings threatened.
D. Underground Storage Tanks. To the best of ELXSI's and Xxxxxxxx'x
knowledge and belief (i) there are no underground oil storage tanks located on
the Kingston property and (ii) there has been no release of any oil or other
hazardous or toxic material on or in the vicinity of the Kingston property.
E. Authority, Etc. Xxxxxxxx'x is the sole owner of the Kingston
property and each of Xxxxxxxx'x and ELXSI has the legal right, power and
authority to enter into this Agreement and perform all of its respective
obligations hereunder. The execution and delivery of this Agreement and the
performance by each of Xxxxxxxx'x and ELXSI of their obligations hereunder do
not conflict with or result in the breach of any terms, conditions, or
provisions of any presently outstanding operative order, judgment, writ,
injunction or decree of any court or governmental authority or agreement or
instrument to which either Xxxxxxxx'x or ELXSI is a party or by which the
Kingston property is subject.
13. ELXSI and Xxxxxxxx'x hereby covenant and agree that they shall
continue to operate and maintain the Kingston property in the ordinary course of
business consistent with prudent business practices throughout the term of this
Agreement by, including, without limitation: (i) keeping the Kingston property
and all improvements thereon insured in accordance with the requirements of the
Citizens' mortgage (or any subsequent mortgage); (ii) maintaining the Kingston
property in good repair; (iii) sending Shine copies of monthly operating
statements (before the 15th of the following month), together with any other
financial information, if any, required under the Citizens' mortgage (or any
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subsequent mortgage); (iv) sending Shine evidence of insurance in force on a
yearly basis; (v) paying all real estate and other taxes due on a timely basis;
(vi) sending Shine evidence of payment of all taxes within ten (10) days of when
due. In the event of any casualty, Xxxxxxxx'x and ELXSI shall restore the
Kingston property to substantially its original condition provided that if the
holder of the Citizen's mortgage (or any subsequent mortgage) refuses to release
the proceeds of the required insurance for such purposes, then any surplus
insurance proceeds remaining after satisfaction of the Citizen's mortgage shall
be paid, in escrow, to Shine's counsel, as additional security for the benefit
of Shine pending final resolution of the litigation.
14. In consideration of the undertakings by Shine in this Agreement,
Xxxxxxxx'x and ELXSI further agree that: (i) the amount now due Shine in the
litigation (the "Obligation") is $784,589, consisting principally of all amounts
due Shine under the 2001 Agreement; (ii) the Obligation also reflects
satisfaction of a certain promissory note executed by Shine and dated October
17, 1997 (copy attached as Exhibit "F"); (iii) the Obligation also reflects
satisfaction by Shine of all other obligations relating to the 2001 Agreement,
including appraisal costs, accrued interest, and any other costs; and (iv) the
Obligation is independent of reimbursement by Xxxxxxxx'x and ELXSI to Shine of
his attorneys' fees and costs incurred to date, and paid with the execution of
this Agreement in the amount of $27,500 (estimated through closing of this
Agreement and the recording of the Attachment which is Exhibit "B").
15. In consideration of the execution of this Agreement, and in
addition to the Obligation, Xxxxxxxx'x and ELXSI agree to (i) pay Shine interest
at 7% per annum, on a quarterly basis, on the Obligation until satisfied, and
(ii) reimburse Shine, at the time of satisfaction of all obligations in this
Agreement, for his reasonable attorneys' fees and costs accrued in connection
with the litigation and/or implementing this Agreement between the date hereof
and such date of satisfaction.
16. Xxxxxxxx'x and ELXSI shall also pay on demand all costs, including
court costs and reasonable attorney's fees paid or incurred by Shine in
connection with enforcing the obligations of Xxxxxxxx'x and ELXSI hereunder,
including, without limitation, all costs relating to enforcement of the
attachment granted hereunder against the Kingston property.
17. Bickfords and ELXSI shall promptly notify Shine in writing of the
occurrence of any event which would make any of the representations or
warranties set forth in this Agreement untrue, false or misleading as a result
of any such event.
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18. The obligations of each of Xxxxxxxx'x and ELXSI hereunder shall be
joint and several and binding on their respective successors and assigns. This
Agreement may only be terminated, modified or otherwise altered only by a
writing signed by each of the parties hereto.
IN WITNESS WHEREOF each of the undersigned has executed this Agreement
as a Massachusetts instrument under seal.
Xxxxx X. Xxxxx Xxxxxxxx'x Family Restaurants, Inc.
/s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
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Its: Vice President
ELXSI
By: /s/ Xxxxx X. Xxxxx
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Its: Vice President
Xxxxx X. Xxxxx, XXXXXXXX'X FAMILY RESTAURANTS,
By his attorney, INC. AND ELXSI
By their attorney,
/s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxxxx X. Xxxx
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Xxxxxx X. Xxxxxxxx, BBO #542305 Xxxxxxx X. Xxxx, BBO# 547488
Xxxxxxxxx Xxxxxxxxxx & Xxxx LLP Holland & Knight
000 Xxxxxxx Xxxxx Xxxxx Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
(000) 000-0000 000-000-0000
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