AGREEMENT OF PURCHASE AND SALE
EXHIBIT
2.2
AGREEMENT
OF PURCHASE AND SALE
This
Agreement of Purchase and Sale (“Agreement”)
is
entered into this 5th day of August, 2005, by and between Ford Motor Company,
a
Delaware corporation (“Seller”),
and
PNP Commercial Acquisition, LLC (“Buyer”),
a
Delaware limited liability company and a wholly owned subsidiary of Norprop,
Inc., one of the general partners of Pick-N-Pull Auto Dismantlers, a California
general partnership. Buyer and Seller are each referred to herein as a
“Party”
and
together as the “Parties.”
RECITALS
| A. |
Seller
is the sole owner of 100% of all of the membership interests (the
“Interests”)
of GLA Real Estate Holdings, LLC (“GLARE”),
which is engaged in the business of holding certain real property
assets
consisting of five parcels of land (as further defined in Section
4.1(f)
herein, the “Real
Property”),
which are leased by Xxxxxxxxx Auto Recyclers, LLC, a Delaware limited
liability company, as tenant (“Xxxxxxxxx”)
under certain lease agreements dated June 4, 2003 (each a "Lease").
|
| B. |
Seller
is the holder of (i) a certain Promissory Note and related credit
documents dated June 4, 2003 executed by Tree Acquisition, L.P.,
a
Delaware limited partnership (“Tree”)
and Xxxxxxxxx, payable to Seller in the principal amount of $7,100,000,
together with all accrued interest, fees, expenses, obligations,
claims,
rights and interests therein (the “Series
A Junior Secured Note”)
and (ii) a certain Promissory Note and related credit documents dated
June
4, 2003 executed by Tree and Xxxxxxxxx, payable to the order of Seller
in
the original principal amount of $7,400,000, together with all accrued
interest, fees, expenses, obligations, claims rights and interests
therein
(the “Series
C Junior Secured Note”
and, together with the Series A Junior Secured Note, the “Notes”).
|
| C. |
Prior
to the Closing (as defined in Section 3.1 herein), Seller shall have
entered into an agreement with Xxxxxxxxx (the “Note
Modification Agreement”)
in the form attached hereto as Exhibit
B
whereby the Series C Junior Secured Note shall be
modified.
|
| D. |
In
connection with this Agreement and the transactions contemplated
hereby,
Buyer is entering into a Unit Purchase Agreement of even date herewith
pursuant to which it is agreeing to purchase from Tree all of the
issued
and outstanding units of membership interests of Xxxxxxxxx (the
“Xxxxxxxxx
Transaction”).
|
| E. |
Buyer
desires to purchase from Seller the Assets (defined below) on the
following terms and conditions.
|
| F. |
Seller
desires to sell to Buyer the Assets on the following terms and
conditions.
|
NOW,
THEREFORE, in consideration of the foregoing recitals and the mutual covenants,
representations, warranties, conditions, and agreements contained herein and
in
the other agreements executed in connection herewith, and for other good and
valuable
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consideration,
the receipt and sufficiency of which are hereby acknowledged, and intending
to
be legally bound, the Parties agree as follows:
1. Purchase
and Sale of the Assets and Interests.
1.1. Assets
to be Transferred.
At the
Closing (defined below) on the Closing Date (defined below) and effective as
of
the Effective Time (defined below), Seller shall sell to Buyer and Buyer shall
purchase from Seller, all of Seller’s right, title and interest in the assets,
described in the following clauses (a) and (b) (the “Assets”):
(a) The
Notes; and
(b) The
Interests.
Buyer
hereby acknowledges that the sale of the Notes hereunder shall be on a
non-recourse basis.
1.2. Excluded
Obligations.
Buyer
shall not assume or in any way be liable for the payment, performance or
satisfaction of any liabilities or obligations of Seller except for (a) Seller’s
obligations under the limited liability company agreement of GLARE and (b)
Seller's obligations under the Notes.
2. Purchase
Price; Payment.
2.1. Purchase
Price.
The
Buyer shall pay to Seller Twenty One Million Five Hundred Thousand Dollars
(U.S.
$21,500,000) (the “Purchase
Price”)
in
consideration of the Assets. Exhibit
A
hereto
sets forth the allocation of the Purchase Price among the Assets, which
allocation has been made in accordance with section 1060 of the Internal Revenue
Code of 1986, as amended (the “Code”),
and
the Treasury regulations thereunder (and any similar provision of state, local
or foreign law, as appropriate). Buyer and Seller shall report and file Tax
Returns (defined below), including, without limitation, IRS Form 8594, for
all
Tax purposes in a manner consistent with such allocation and shall take no
position inconsistent therewith or contrary thereto unless required to do so
by
applicable law.
2.2. Payment.
On the
Closing Date, Buyer shall deliver, by wire transfer of immediately-available
funds, the Purchase Price to an account designated by Seller.
3. Closing.
3.1. Closing.
The
consummation of the transactions contemplated by this Agreement (the
“Closing”)
shall
take place at 9:00 a.m. at the offices of Xxxxx Liddell & Xxxx, Dallas,
Texas, or such other location as is mutually agreed upon by the Parties,
on the
date
on which the Closing of the Xxxxxxxxx Transaction occurs (the “Xxxxxxxxx
Closing”)
or
such other date as the Parties may mutually agree in writing (the “Closing
Date”),
effective simultaneously with the Xxxxxxxxx Closing (the “Effective
Time”).
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3.2. Closing
Costs.
Except
as set forth in this Section 3.3, all costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid
by
the Party incurring such costs and expenses. Notwithstanding the foregoing,
Buyer shall (a) bear all real estate transfer taxes, recording fees, escrow
fees
and lot split costs, if and to the extent applicable, associated with the
transactions contemplated by this Agreement and (b) pay for the ALTA surveys
delivered to Buyer pursuant to Section 3.3(a)(iv).
3.3. Closing
Deliveries.
(a) By
Seller.
Seller
shall execute and/or deliver the following to Buyer on or before the Closing
Date, all in form and substance reasonably acceptable to Buyer:
(i) a
xxxx of
sale for the Notes;
(ii) an
assignment of the Interests;
(iii) evidence
of execution and delivery of the Note Modification Agreement;
(iv) ALTA
Surveys for each of the parcels of Real Property pursuant to the provisions
of
Section 5.4;
(v) evidence
of waiver or release of the rights granted to Tree in the Letter Agreement
(as
defined in Section 4.1(f);
(vi) a
certificate from Seller in the form attached hereto as Exhibit
3.3(a)(vi),
certifying that the conditions contained in Section 6.1(b)
and
Section 6.1(c)
have
been satisfied;
(vii) a
non-foreign affidavit dated as of the Closing Date, sworn under penalty of
perjury and in form and substance required under Treasury regulations issued
pursuant to section 1445 of the Code (defined below) stating that Seller is
not
a “Foreign Person” as defined in section 1445 of the Code;
(viii) written
resignations of the Officers of GLARE; and
(ix) such
further instruments and documents as Buyer may reasonably request to assure
the
full and effective sale to it of the Assets and the performance of Seller’s
obligations hereunder.
(b) By
Buyer.
Buyer
shall execute and/or deliver the following to Seller on or before the Closing
Date, all in form and substance reasonably acceptable to Seller:
(i) the
Purchase Price;
(ii) a
certificate of Buyer in the form attached hereto as Exhibit
3.3(b)(ii),
certifying that the conditions contained in Section 6.2(c)
and
Section 6.2(d)
have
been satisfied; and
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(iii) such
further instruments and documents as Seller may reasonably request to assure
the
full and effective sale to Buyer of the Assets and the performance by Buyer
of
Buyer’s obligations hereunder.
(c) Books
and Records.
On or
before the Closing Date, Seller shall have delivered the originals or
photocopies of all books and records in the possession of Seller or any of
its
affiliates relating exclusively to GLARE that are not available at the Real
Property to Buyer. The Parties shall cooperate fully with each other after
the
Closing so that each Party has access, for any proper purpose, to all books
and
records existing at the Closing Date which relate exclusively to GLARE or the
Real Property prior to the Closing (whether such records are in the possession
of Buyer or Seller). Following the closing, the Party in possession of any
books
or records existing at the Closing Date which relate exclusively to GLARE or
the
Real Property prior to the Closing shall use its reasonable efforts to not
destroy such books or records for a period of six (6) years after the Closing
Date without giving the other Party at least thirty (30) days’ prior written
notice and permitting such Party to examine and remove such books and records
prior to their destruction. Access to such books and records shall be during
normal business hours and upon not less than two (2) days’ prior written
request, and shall be subject to such reasonable limitations as the Party having
custody or control thereof may impose to preserve the confidentiality of
information contained therein.
4. Representations
and Warranties.
4.1. Seller’s
Representations and Warranties.
Seller
hereby makes the following representations and warranties, each of which is
true
and correct on the date hereof and shall survive the Closing to the extent
set
forth herein:
(a) Organization,
Qualification and Power.
Seller
is a corporation duly organized, validly existing and in good standing under
the
laws of the State of Delaware. GLARE is a limited liability company duly
organized, validly existing and in good standing under the laws of the State
of
Delaware. Seller has delivered to Buyer true, complete and correct copies of
GLARE’s certificate of formation and limited liability company agreement as
currently in effect. Seller is the sole holder of record and the beneficial
owner of all of the Interests of GLARE. GLARE has all requisite company power
and authority to own and lease the Real Property. Seller has not received any
notices from any Government agency indicating that it does not have any
authorizations, licenses and permits necessary and required in respect of its
ownership of the Interests. GLARE is duly registered, licensed or qualified
to
do business as a foreign entity and is in good standing in the states, where
such registration, licensure or qualification is required.
(b) Ownership
of the Interests.
The
authorized, issued and outstanding Interests of GLARE are set forth in
Schedule
4.1(b).
All
voting rights in GLARE are vested exclusively in its units of membership
interests, and there are no voting trusts, proxies or other agreements or
understandings with respect to the voting of the units of membership interests
of GLARE. All of the issued and outstanding units of membership interests of
GLARE are validly authorized and issued, fully paid and non-assessable. Except
for Buyer’s rights pursuant to this Agreement, there are no outstanding
warrants, options or rights of any kind to acquire from Seller
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or
GLARE
any units of membership interests of GLARE or securities of any kind, and there
are no preemptive rights with respect to the issuance or sale of units of
membership interests of GLARE. GLARE has no obligation to acquire any of its
issued and outstanding units of membership interests or any other security
issued by it from any holder thereof.
(c) Authorization;
Enforceability; Noncontravention.
Seller
has all necessary power and authority to enter into this Agreement (and all
other agreements, instruments and certificates executed and delivered in
connection herewith) and to carry out their terms, and will have taken by
Closing all action necessary to consummate the transactions contemplated hereby
and thereby and to perform its respective obligations hereunder and thereunder.
This Agreement has been duly executed and delivered by Seller, and each and
every agreement, instrument and certificate contemplated by this Agreement
to
which Seller is a Party will be duly executed and delivered by Seller, and
this
Agreement and each such other agreement, instrument and certificate will be
a
legal, valid and binding obligation of Seller, enforceable against Seller in
accordance with the terms hereof and thereof, except as such enforceability
may
be subject to (i) any bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or similar laws affecting creditors’ rights
generally, and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity). Except
for the Leases and other agreements set forth on Schedule
4.1(c),
neither
GLARE nor Seller is a party to any contracts or other binding agreements that
relate to the Interests or the Real Property, and to the Knowledge of Seller,
there are no Orders or Actions (each as defined below) that would prevent the
carrying out of the transactions contemplated hereby or which do or would
restrict or limit GLARE’s right to own and lease the Real Property. GLARE is a
special purpose entity formed for the purpose of owning and leasing the Real
Property to Xxxxxxxxx.
(d) Undisclosed
Liabilities.
GLARE
does not have any liability or obligation (whether absolute, accrued, contingent
or other, and whether due or to become due) that is not accrued, reserved
against or disclosed in the financial statements of GLARE, other than
liabilities incurred in the ordinary course of business and consistent with
past
practice arising from the ownership or leasing of the Real Property. The
financial statements of GLARE are attached as Schedule
4.1(d).
(e) Title
to the Assets.
Seller
has good and marketable title to the Assets. Upon
the
Closing, good and marketable title to the Assets shall be vested in Buyer free
and clear of all Liens. For purposes of this Agreement, “Lien” shall mean any
lien, security interest, financing statement, mortgage, indenture, deed of
trust, pledge, charge, adverse claim, or other encumbrance. No consent or permit
from any third Party is necessary to transfer the Assets, and there exists
no
restriction on the transfer of the Assets or the consummation of the
transactions contemplated hereby.
(f) Real
Property.
(i) Set
forth
on Schedule
4.1(f)(i)
is a
list of the real property owned by GLARE (the “Real
Property”),
together with the address of each parcel of Real Property. GLARE owns no assets
other than the Real Property. Neither
Seller nor GLARE has encumbered the Real Property with a mortgage, deed of
trust, indenture or other security interest
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or
failed
to timely pay any income Tax that has or would give rise to a Lien for Taxes
being placed against the Real Property.
(ii) GLARE
is
not the lessee of any real property.
(iii) Other
than the leasehold interests in the Real Property held by Xxxxxxxxx, GLARE
is
not the lessor of any real property. Except as set forth on Schedule
4.1(f)(iii), to Seller’s Knowledge, there is no pending or threatened
condemnation proceeding, administrative action or judicial proceeding of any
type relating to the Real Property.
(iv) Other
than the leasehold interests in the Real Property held by Xxxxxxxxx, neither
Seller nor GLARE has granted any leases, subleases, options, rights of first
refusal, licenses, easements, concessions or other agreements, written or oral,
granting to any person or entity the right to use or occupy any portion of
the
Real Property, other than that certain letter agreement between GLARE and Tree
dated as of June 4, 2003 (the “Letter Agreement”) (which shall have been
released or waived as of Closing).
(g) Compliance
with Laws and Constituent Documents.
Except
for any items that XxxxxXxxx is responsible for under the terms of the
applicable leases, to Seller’s Knowledge GLARE is not in violation of, or
subject to a claim of remedial or similar obligation under, any applicable
order, judgment, injunction, award, decree or writ (collectively, “Orders”),
or
any applicable law, statute, code, ordinance, injunction, rule, regulation
or
other requirement (collectively, “Laws”),
of
any government or political subdivision thereof, or any agency or
instrumentality of any such government or political subdivision, or any court
or
arbitrator (collectively, “Government”);
neither Seller nor GLARE has received written notice that any such violation
is
being or may be alleged; GLARE is not nor has it been in default under or in
breach or violation of any provision of its certificate of formation or limited
liability company agreement (or equivalent documents).
(h) Consents
and Approvals.
No
consent, approval or authorization of, or declaration, filing or registration
with, any Government or regulatory authority, or any other person or entity,
is
required to be made or obtained by Seller in connection with the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby.
(i) Litigation.
There
is no, and since June 4, 2003 there has not been any, suit, claim, litigation,
proceeding (administrative, judicial, or in arbitration, mediation or
alternative dispute resolution), Government or grand jury investigation, or
other action (any of the foregoing, an “Action”)
pending or, to Seller’s or GLARE’s knowledge, threatened, anticipated or
contemplated against Seller with respect to the Interests or GLARE involving
the
Real Property, or any of GLARE’s members, officers, agents, or other personnel
in their capacity as such, including, without limitation, any Action
challenging, enjoining, or preventing this Agreement, or the consummation of
the
transactions contemplated hereby.
(j) Tax
Matters.
(i) GLARE
has
timely and properly filed all Income Tax returns (including any information
return), reports, statements, schedules, notices, forms,
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declarations,
claims for refund and other documents or information required to be filed by
it
(the “Income
Tax Returns”).
All
such Income Tax Returns are true, accurate and complete.
(ii) All
Income Taxes due and owing by GLARE have
been
timely and fully paid.
(iii) GLARE
is
not a party to or bound by any Tax indemnity, Tax sharing or Tax allocation
agreement or arrangement.
(iv) Definitions.
“Tax”
means
any income, gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, property, environmental, windfall profit, customs,
vehicle, airplane, boat, vessel or other title or registration, capital stock,
franchise, employees’ income withholding, foreign or domestic withholding,
social security, unemployment, disability, real property, personal property,
sales, use, transfer, value added, alternative, add-on minimum and other tax,
fee, assessment, levy, tariff, charge or duty of any kind whatsoever and any
interest, penalty, addition or additional amount thereon imposed, assessed
or
collected by or under the authority of any Government, whether or not disputed
and including any obligations to indemnify or otherwise assume or succeed to
the
Tax liability of any other person or entity. “Income
Tax”
means
any income, gross receipts, windfall profit, franchise, alternative, add-on
minimum and other income tax, of any kind whatsoever and any interest, penalty,
addition or additional amount thereon imposed, assessed or collected by or
under
the authority of any income tax authority, whether or not disputed and including
any obligations to indemnify or otherwise assume or succeed to the Income Tax
liability of any other person or entity.
(k) Environmental.
Buyer
acknowledges and agrees that, as between Seller and Buyer, Buyer is purchasing
GLARE and taking the Real Property in its “as-is” condition as to environmental
matters and Buyer is solely relying on its investigation of the physical and
environmental condition of the Real Property. Seller makes no representations
or
warranties as to the adequacy or accuracy of any Phase I Environmental Reports
or any other environmental information about the Real Property provided by
Seller.
(l) Records.
The
books of account, minute books, purchase and sale records (collectively, the
“Records”)
of
GLARE are true, complete and accurate in all material respects, and there have
been no transactions involving GLARE or the Real Property that properly should
have been set forth therein and have not been accurately so set forth. True,
complete and accurate copies of the Records have been made available to Buyer.
(m) Brokers.
Seller
has not entered into nor will Seller enter into any agreement, arrangement
or
understanding with any person or firm that will result in the obligation of
Buyer to pay any finder’s fee, brokerage commission or similar payment in
connection with the transactions contemplated hereby.
(n) Employment
Matters.
GLARE
has no employees or employee benefit plans.
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Seller
acknowledges that the foregoing warranties and representations are material
and
are being relied upon by Buyer (the continued truth and accuracy of which shall
constitute a condition precedent to Buyer’s obligations hereunder). Seller
represents and warrants to, and covenants with Buyer that Seller’s
representations and warranties set forth in this Section 4.1
will be
true and correct in all material respects (except for those representations
and
warranties that are qualified as to materiality which shall be true and correct
in all respects) as of the Closing Date. Seller agrees to take no voluntary
and
intentional actions or omissions to act, which would cause any of Seller’s
representations or warranties contained in this Agreement to become untrue.
If,
after the date hereof and prior to the Closing Date, Seller becomes aware that
any of its representations or warranties are, or have become, untrue (whether
occurring before or after the date hereof), with or without the voluntary and
intentional act or omission to act of Seller, then Seller shall promptly give
written notice of such fact to Buyer. In such event, Buyer may, in Buyer’s sole
and absolute discretion but without obligation to do so, terminate this
Agreement, in which event this Agreement shall automatically terminate and
none
of the Parties shall thereafter have any further obligations or liability under
this Agreement, except as otherwise expressly provided herein; provided that,
if
Buyer does not terminate this Agreement as a result of such notice, any related
breach of representation and warranty shall be deemed cured or
waived.
4.2. Buyer's
Representations and Warranties.
Buyer
hereby makes the following representations and warranties, each of which is
true
and correct on the date hereof and shall survive the Closing Date and the
transactions contemplated hereby to the extent set forth herein.
(a) Corporate
Organization, Qualification and Power.
Buyer
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware, and has all requisite limited
liability company power and authority to own, lease and use its assets and
to
conduct its business.
(b) Authorization;
Enforceability; Noncontravention.
Buyer
has all necessary power and authority to enter into this Agreement (and all
other agreements, instruments and certificates executed and delivered in
connection herewith) and to carry out their terms, and has taken all action
necessary to consummate the transactions contemplated hereby and thereby and
to
perform its obligations hereunder and thereunder. This Agreement has been duly
executed and delivered by Buyer and each and every agreement, instrument and
certificate contemplated by this Agreement to which Buyer is a party will be
duly executed and delivered by Buyer and this Agreement and each such other
agreement, instrument and certificate will be a legal, valid and binding
obligation of Buyer, enforceable against Buyer in accordance with the terms
hereof and thereof, except as such enforceability may be subject to (i) any
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors’ rights generally, and (ii)
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity). Buyer is not a party to or bound by any
agreement or any order or requirement of any Government body which would
restrict or limit its ability to perform its obligations hereunder.
(c) No
Brokers.
Buyer
has not entered into nor will Buyer enter into any agreement, arrangement or
understanding with any person or firm that will result in the
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obligation
of Seller to pay any finder’s fee, brokerage commission or similar payment in
connection with the transactions contemplated hereby.
(d) Acquisition
of Interests for Investment. Buyer
is
not acquiring the Interests with any present intention of distribution or
selling such Interests in violation of federal, state or other securities laws.
Buyer expressly agrees not to sell or otherwise dispose of the Interests in
violation of any federal, state or other securities laws.
(e) Purchase
of Notes.
Buyer
acknowledges that it will be purchasing the Notes from Seller on a non-recourse
basis and that Seller (i) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Notes or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Note or any other instrument or document
furnished pursuant thereto; and (ii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of Tree or
XxxxxXxxx or the performance or observance by Tree or XxxxxXxxx of any of their
respective obligations under the Notes or any other instrument or document
furnished pursuant thereto. In addition, Buyer confirms that it has received
a
copy of the Notes and such other documents and information (including financial
information relating to Tree and XxxxxXxxx) as it has deemed appropriate to
make
its own credit analysis and decision to enter into this Agreement and to
purchase the Notes, independently and without any reliance upon any
representation, warranty or certification of Seller, or any affiliate of Seller,
except as expressly set forth in this Agreement.
Buyer
acknowledges that the foregoing warranties and representations are material
and
are being relied upon by Seller (the continued truth and accuracy of which
shall
constitute a condition precedent to Seller’s obligations hereunder). Buyer
represents and warrants to, and covenants with Seller that Buyer’s
representations and warranties set forth in this Section 4.2 will
be
true and correct in all material respects (except for those representations
and
warranties that are qualified as to materiality which shall be true and correct
in all respects) as of the Closing Date. Buyer agrees to take no voluntary
and
intentional actions or omissions to act, which would cause any of Buyer’s
representations or warranties contained in this Agreement to become untrue.
If,
after the date hereof and prior to the Closing Date, Buyer becomes aware that
any of its representations or warranties are, or have become, untrue (whether
occurring before or after the date hereof), with or without the voluntary and
intentional act or omission to act of Buyer, then Buyer shall promptly give
written notice of such fact to Seller. In such event, Seller may, in Seller’s
sole and absolute discretion but without obligation to do so, terminate this
Agreement, in which event this Agreement shall automatically terminate and
neither Party shall thereafter have any further obligations or liability under
this Agreement, except as otherwise expressly provided herein, provided that;
if
Seller does not terminate this Agreement as a result of such notice, any related
breach of representation and warranty shall be deemed cured or
waived.
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5. Covenants.
5.1. Modification
of Note.
Prior
to the Closing Seller shall enter into the Note Modification Agreement.
5.2. Conduct
Until Closing.
During
the period between the date this Agreement is executed and the Closing Date
(the
“Interim
Period”),
Seller shall cause GLARE to, at Seller’s or GLARE’s cost, not enter into any
transaction outside the ordinary course of business or terminate, amend, modify
or extend any existing lease.
5.3. Investigation
by Buyer.
During
the Interim Period, Seller shall allow Buyer or Buyer's agents and
representatives, during regular business hours and such other times as Buyer
may
reasonably request, to make such investigation of GLARE, the Assets, the Real
Property, and all books and records relating thereto, and to conduct such
examinations as Buyer deems necessary or advisable to familiarize itself
therewith, including, without limitation, such environmental studies and
sampling as Buyer reasonably deems advisable to determine the environmental
conditions at the Real Property; to identify any facts, matters or conditions
that Buyer may deem material; and to verify the representations and warranties
of Seller hereunder.
5.4. Title
Matters.
Seller
shall be responsible for securing an ALTA survey for the Real Property certified
to Buyer and satisfying such requirements as Buyer shall require, at Buyer’s
expense. Seller will provide copies of any such ALTA survey to Buyer, as well
as
copies of any other due diligence materials created or acquired from third
parties. Seller shall be responsible for securing, at Seller’s expense, the
standard coverage title insurance and shall utilize LandAmerica for the title
work. Any endorsements above the standard endorsements to the title insurance
policy shall be Buyer’s responsibility.
5.5. Consents.
Seller
will, as soon as possible, take all action required to obtain all consents,
approvals and agreements of, and to give all notices and make any filings with,
any third parties, including Government bodies, necessary to authorize, approve
or permit the sale of the Assets.
5.6. Possession.
Possession of the Assets shall be delivered to Buyer on the Closing Date. On
the
Closing Date, Seller shall deliver to Buyer keys to all locks for the facilities
located on the Real Property in the possession of Seller, GLARE or Seller’s or
GLARE’s agents or employees.
5.7. Risk
of Loss.
To the
extent that there is a loss or damage to the Real Property by fire, flood or
other casualty that is not the responsibility of XxxxxXxxx under the relevant
Lease (whether by required insurance or otherwise), such risk of loss shall
be
borne by Seller up to the Effective Time. In the event of any such loss or
damage prior to the Effective Time, Seller shall either (1) promptly pay to
Buyer any amount equal to the fair market value of such loss or damage,
or
(2) promptly replace or repair such loss or damage to Buyer's satisfaction,
and
in any event within a commercially reasonable period.
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5.8. Tax
Covenants.
(a)
All
sales, use, transfer, documentary, registration and other similar Taxes (other
than Income Taxes of Seller) and fees (including any penalties and interest),
if
any, incurred in connection with the transfer of the Assets shall be borne
by
Buyer. Seller shall prepare or cause to be prepared and timely file any Tax
Returns required to be filed in connection with any such Taxes, and Buyer shall
cooperate with Seller in such preparation.
(b) All
Income Taxes applicable to or payable by GLARE in respect of any Tax periods
ending on or before the Effective Time are the responsibility of and shall
be
paid by Seller.
(c) From
and
after the Closing Date until the applicable statute of limitations expires,
to
the extent reasonably requested by the other Party, and at the requesting
Party’s expense, Seller and Buyer shall assist and cooperate with the other in
the preparation and filing of any Tax Return described in this Section 5.8
and
shall assist and cooperate with the other in preparing for any disputes, audits
or other litigation relating to Taxes for which the other Party is responsible
pursuant to this Agreement. Any Income Tax audit or other Income Tax proceeding
relating to the Income Taxes of GLARE shall be deemed to be a third-party claim
subject to the procedures set forth in Section 7.5 of this
Agreement.
5.9. Further
Assurances.
On and
after the Closing Date, the Parties will take all appropriate action and execute
all documents, instruments or conveyances of any kind that may be reasonably
required to make effective the transactions contemplated hereby.
6. Conditions
to Closing.
6.1. Buyer's
Conditions to Closing.
Buyer’s
obligation to proceed with the Closing is subject to the satisfaction of the
following conditions precedent, any of which may be waived in whole or in part
by Buyer:
(a) The
simultaneous consummation of the Xxxxxxxxx Transaction.
(b) Seller’s
representations and warranties set forth in this Agreement shall be true and
correct in all material respects, except for those representations and
warranties that are qualified as to materiality which shall be true and correct
in all respects, on and as of the date hereof and on and as of the Closing
Date
as if made on and as of the Closing Date, except for modifications to any
representation or warranty which may have been agreed to in writing by
Buyer.
(c) Seller
shall have performed and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed or complied
with by Seller on or prior to the Closing Date including delivery of the
documents required by Section 3.3(a).
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(d) Buyer
shall have completed its due diligence review of GLARE and the Real Property,
and in its sole discretion, shall be satisfied with the results of such due
diligence review.
(e) During
the Interim Period no Order of any Government shall have been made, which would
impose any limitations or conditions that prohibits or prevents the consummation
of the transactions contemplated by this Agreement.
(f) All
filings required under this Agreement to be made by GLARE with Government
authorities shall have been made and any necessary authorizations, consents
or
approvals required from such Government authorities to consummate this Agreement
shall have been obtained and shall be in full force and effect.
(g) On
the
Closing Date, there shall exist no valid Order which prohibits or prevents,
and
no Action shall have been instituted or be threatened that seeks to prohibit
or
prevent, the consummation of the transactions contemplated by this
Agreement.
6.2. Seller’s
Conditions to Closing.
Seller’s obligation to proceed with the Closing is subject to the satisfaction
of the following conditions precedent, any of which may be waived in whole
or in
part by Seller:
(a) The
simultaneous consummation of the Xxxxxxxxx Transaction.
(b) The
simultaneous execution of the Working Capital Increase Agreement with Tree
in
form attached hereto as Exhibit 6.2(b).
(c) The
representations and warranties of Buyer in this Agreement shall be true and
correct in all material respects, except for those representations and
warranties that are qualified as to materiality which shall be true and correct
in all respects, on and as of the date hereof and on and as of the Closing
Date
as if made on and as of the Closing Date, except for modifications to any
representation or warranty, which may have been agreed to in writing by
Seller.
(d) Buyer
shall have performed and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed or complied
with by Buyer on or prior to the Closing Date including delivery of the Purchase
Price and the documents required to be delivered by Buyer pursuant to Section
3.3(b).
(e) On
the
Closing Date, there shall exist no valid Order which prohibits or prevents,
and
no Action shall have been instituted or be threatened that seeks to prohibit
or
prevent, the consummation of the transactions contemplated by this Agreement.
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7. Indemnification.
7.1. Survival
of Representations, Warranties, Covenants and
Agreements.
(a) Except
as
otherwise explicitly provided herein, all covenants and agreements in this
Agreement and all representations, warranties, covenants and agreements in
any
certificate, agreement, instrument or other document delivered in connection
with this Agreement shall terminate on the Closing Date; provided that, the
covenants and obligations contained in Sections 5.8, 5.9, 7.1 7.2, 7.3, 7.4,
7.5
and Sections 8.1 - 8.22 shall survive the Closing Date until the expiration
of
the applicable statute of limitations.
(b) All
representations and warranties contained in this Agreement shall survive the
Closing Date for a period of 18 months; provided that,
the
representations and warranties contained in Section 4.1(a)
(Corporate Organization, Qualification and Power), Section 4.1(c)
(Authorization; Enforceability; Noncontravention), Section 4.1(e) (Title to
the
Assets), Section 4.1(j) (Tax Matters); Section 4.1(a)
(Corporate Organization, Qualification and Power), Section 4.1(c)
(Authorization; Enforceability; Noncontravention), Section 4.2(d) (Acquisition
of Interests for Investment), and Section 4.2(e) (Purchase of Notes) shall
survive the Closing Date until the expiration of the applicable statutes of
limitation, including any suspensions, tollings or extensions
thereof.
7.2. By
Seller.
With
respect to any notice of claim from Buyer delivered in writing to Seller no
later than twenty (20) days following the expiration of the applicable survival
period provided in Section 7.1, if Closing is consummated Seller agrees to
indemnify, defend and hold Buyer and its affiliates, including their respective
shareholders, directors, officers, partners, employees, successors, assigns,
representatives and agents (collectively, the “Buyer
Indemnified Persons”)
harmless from and against, any loss, cost, liability, claim, expense, penalty
or
fine, including reasonable attorneys’ fees, without regard to whether litigation
is commenced (in all, “Indemnified
Losses”)
suffered or incurred, directly or indirectly, as a result of:
(a) any
breach by Seller of any of Seller’s representations or warranties contained in
this Agreement;
(b) any
breach by Seller of any of Seller’s covenants or obligations contained in this
Agreement;
and
(c) any
Income Taxes (or the non-payment thereof) of GLARE, including its liability,
if
any (for example by reason of transferee liability or application of Treasury
regulation section 1.1502-6) for the Taxes of others, for all Tax periods or
portions thereof, ending on or before the Effective Time.
7.3. By
Buyer.
With
respect to any notice of claim from Seller delivered in writing to Buyer no
later than twenty (20) days following the expiration of the applicable survival
period provided in Section 7.1 , if Closing is consummated Buyer agrees to
indemnify, defend and hold Seller and its affiliates, including their respective
shareholders, directors, officers, partners, employees, successors, assigns,
representatives and agents (collectively, the "Seller
Indemnified Persons"),
harmless from and against any Indemnified Losses suffered or
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incurred,
directly or indirectly, as a result of a breach by Buyer of any representation,
warranty, covenant or obligation contained in this Agreement.
7.4. Limitations
on Indemnity.
A Party
seeking indemnification hereunder shall take commercially reasonable measures
to
mitigate its Indemnified Losses, and upon payment therefore, the Indemnifying
Party shall be subrograted to any rights of the Indemnified party against all
third parties in respect of such Indemnified Losses. Seller shall have no
obligation to indemnify Buyer Indemnified Persons in respect of Indemnified
Losses under Section 7.2
in
excess of $1,060,000 (the “Indemnity
Cap”);
provided,
however,
that
the foregoing Indemnity Cap shall not apply in any manner whatsoever to Seller’s
indemnification obligations under Section 7.2 for any breach of the
representations and warranties contained in Section 4.1(a)
(Corporate Organization, Qualification and Power), Section 4.1(c)
(Authorization; Enforceability; Noncontravention), Section 4.1(e) (Title to
the
Assets), Section 4.1(j)
(Tax
Matters), or Section 4.1(m)
(Brokers).
7.5. Notice
of Claim.
A Party
seeking indemnification hereunder shall promptly notify the other Party in
writing of the existence of any matter to which the indemnification obligations
would apply; provided,
however,
that
the right of a Party to be indemnified hereunder shall not be adversely affected
by a failure to give such notice unless, and then only to the extent that,
the
other Party is actually prejudiced thereby. The indemnified Party shall give
the
indemnifying Party a reasonable opportunity to defend a third-party claim at
its
own expense and with counsel of its own selection; provided that the indemnified
Party shall at all times also have the right to fully participate in the defense
at its own expense.
8. Miscellaneous.
8.1. Entire
Agreement.
This
Agreement and the Schedules and Exhibits hereto (as executed at the Closing)
constitute the entire agreement between the Parties, all oral agreements being
merged herein. There are no representations, agreements, arrangements, or
understandings, oral or written, between or among the Parties relating to the
subject matter of this Agreement that are not fully expressed herein or in
the
Schedules and Exhibits hereto (as executed at the Closing).
8.2. Amendment.
The
provisions of this Agreement may be modified at any time only by written
agreement of the Parties
8.3. Waiver.
Any of
the terms or conditions of this Agreement may be waived at any time by the
Party
entitled to the benefit thereof, but no such waiver shall affect or impair
the
right of the waiving Party to require observance, performance or satisfaction
either of that term or condition as it applies on a subsequent occasion or
of
any other term or condition.
8.4. Assignment.
Neither
this Agreement nor any of the rights, interests, or obligations hereunder shall
be transferred, delegated, or assigned by any Party hereto without the prior
written consent of the other Party, except that (i) Buyer shall have the right
to transfer and assign any or all of its rights and obligations hereunder to
any
entity which at the time of such transfer and assignment is controlled by Buyer
or by the affiliates of Buyer, provided that Buyer
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shall
not
be relieved of its obligations hereunder, and (ii) Seller shall have the right
to assign its right to receive payments, but not its obligations,
hereunder.
8.5. Succession.
Subject
to any contrary provisions contained in this Agreement, this Agreement shall
inure to the benefit of and be binding on the successors and assigns of the
respective Parties.
8.6. Parties
in Interest.
Nothing
in this Agreement, whether express or implied, is intended to confer any rights
or remedies under or by reason of this Agreement on any persons other than
the
Parties to it and their respective successors and assigns, nor is anything
in
this Agreement intended to relieve or discharge the obligation or liability
of
any third persons to any Party to this Agreement, nor shall any provision give
any third persons any right of subrogation or action against any Party to this
Agreement.
8.7. Specific
Performance.
Each
Party’s obligations under this Agreement are unique. The Parties each
acknowledge that, if any Party should default in performance of the duties
and
obligations imposed by this Agreement, it would be extremely impracticable
to
measure the resulting damages. Accordingly, the non-defaulting Party, in
addition to any other available rights or remedies available to it at law or
in
equity, may xxx in equity for specific performance, and the Parties each
expressly waive the defense that a remedy in damages will be
adequate.
8.8. Notices.
Any
notice under this Agreement shall be in writing, and any written notice or
other
document shall be deemed to have been duly given (i) on the date of personal
service on the Parties, (ii) on the third business day after mailing, if the
document is mailed by registered or certified mail, (iii) one day after being
sent by professional or overnight courier or messenger service guaranteeing
one-day delivery, with receipt confirmed by the courier, or (iv) on the date
of
transmission if sent by facsimile or other means of electronic transmission
resulting in written copies, with receipt confirmed. Any such notice shall
be
delivered or addressed to the Parties at the addresses set forth on the
signature page hereto or at the most recent address specified by the addressee
through written notice under this provision. A copy of all notices to Buyer
shall be sent to Buyer’s address to the attention of the Chief Financial
Officer. Failure to give notice in accordance with any of the foregoing methods
shall not defeat the effectiveness of notice actually received by the
addressee.
8.9. Legal
Fees.
If the
services of counsel are required by any Party to secure the performance of
this
Agreement or otherwise upon the breach or default of another Party to this
Agreement, or if any judicial remedy or arbitration is necessary to enforce
or
interpret any provision of this Agreement or the rights and duties of any person
in relation thereto, each Party shall be responsible for their own attorneys’
fees, costs and other expenses.
8.10. Counterparts.
This
Agreement may be executed in any number of counterparts with the same effect
as
if the Parties had all signed the same document. All counterparts shall be
construed together and shall constitute one agreement.
8.11. Captions.
All
paragraph captions are for reference only and shall not be considered in
construing this Agreement.
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8.12. Severability.
If any
provision of this Agreement is held to be invalid or unenforceable under
applicable Law in any jurisdiction, the validity or enforceability of the
remaining provisions thereof shall be unaffected as to such jurisdiction and
such holding shall not affect the validity or enforceability of such provision
in any other jurisdiction. To the extent that any provision of this Agreement
is
held to be invalid or unenforceable because it is overbroad, that provision
shall not be void but rather shall be limited only to the extent required by
applicable Law and enforced as so limited.
8.13. Governing
Law.
The
rights and obligations of the Parties and the interpretation and performance
of
this Agreement shall be governed by the laws of the State of Michigan, without
reference to its choice of law rules.
8.14. Exhibits
and Schedules.
All
Exhibits and Schedules to which reference is made are deemed incorporated in
this Agreement whether or not actually attached.
8.15. Time.
Time is
of the essence with respect to this Agreement.
8.16. Gender
and Number.
As used
in this Agreement, the masculine, feminine, or neuter gender, and the singular
or plural number, shall each be deemed to include the others whenever the
context so indicates.
8.17. Cumulative
Remedies.
No
remedy or election hereunder shall be deemed exclusive but shall whenever
possible be cumulative with all other remedies available at law or in equity;
provided that in no event shall any Party be liable to the other for lost
profits, consequential or punitive damages; provided further that, in the event
of the termination of this Agreement, neither Party shall have any liability
to
the other unless such termination is the result of a willful or intentional
breach by such Party.
8.18. Additional
Documents.
From
time to time prior to and after the Closing, Buyer and Seller shall execute
and
deliver such instruments of transfer and other documents as may be reasonably
requested by the other Party to carry out the purpose and intent of this
Agreement.
8.19. Construction.
Buyer
and Seller hereby acknowledge and agree that (i) each Party to this Agreement
is
of equal bargaining strength, (ii) each Party has actively participated in
the
drafting, preparation and negotiation of this Agreement, (iii) each Party has
consulted or has had the opportunity to consult with such Party’s own
independent counsel, and such other professionals as such Party deems
appropriate relative to any and all matters contemplated under this Agreement,
(iv) each Party and such Party’s counsel and advisors have reviewed this
Agreement and, following such review, each Party agrees to enter into this
Agreement, and (v) any rule of construction to the effect that ambiguities
are
to be resolved against the drafting Party shall not apply in the interpretation
of this Agreement, or any portions hereof or any amendments hereto.
8.20. Knowledge.
For
purposes of this Agreement, “Knowledge” of GLARE or Seller shall mean (i) the
actual awareness of the individuals set forth on Schedule 8.20. The words
“know,”“knowing,”“known,” and “aware” shall be construed accordingly.
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8.21. Press
Releases and Announcements.
Neither
Party to this Agreement will directly or indirectly make or cause to be made
any
public announcement or disclosure, or issue any notice or press release with
respect to this Agreement or the transactions contemplated by this Agreement
without the prior written consent of the other Party to this Agreement; provided
that any Party to this Agreement may make any public announcement or disclosure
which is required by Law, NASDAQ rules or the disclosure policies of Buyer’s
corporate parent, with the understanding that the Parties will provide as little
disclosure under these circumstances as the law requires; provided,
however, that
the
Parties agree that the corporate parent of Buyer may make additional disclosure
and file this Agreement with the U.S. Securities and Exchange Commission
(“SEC”)
as
required by applicable law and SEC rules.
8.22. Confidentiality.
The
Parties covenant that any Confidential Information relating to businesses
operated by either Buyer or Seller, as the case may be (the “Disclosing Party”),
and received or otherwise discovered by the other Party (the “Receiving Party”)
prior to the Closing shall be maintained in confidence for a period of at least
three years following Closing and shall not be disclosed or used by such
Receiving Party or its representatives without the Disclosing Party’s prior
written consent, unless such information is (i) otherwise publicly available,
(ii) required to be disclosed pursuant to judicial order, regulation or law,
or
(iii) required to be disclosed by the rules of a securities exchange on which
either Party may from time to time be listed. In the event that the Receiving
Party or any of its representatives becomes legally compelled to disclose any
such information or documents as referred to in this Section, the Receiving
Party shall use reasonable efforts to provide the Disclosing Party with prompt
written notice before such disclosure, so that the Disclosing Party can either
seek a protective order, at its expense, or other appropriate remedy preventing
or prohibiting such disclosure or to waive compliance with the provisions of
this Section 8.22 or both.
IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the day and
year
first above written.
| BUYER: | SELLER: | |
| PNP COMMERCIAL ACQUISITION, LLC | FORD MOTOR COMPANY | |
|
By: /s/
Xxx Xxxxxx
Name:
Xxx Xxxxxx
Title:
President
|
By:
/s/ Xxxxxxx X. Xxxxxxx
Name:
Xxxxxxx X. Xxxxxxx
Title:
Assistant Secretary
|
| Address: | Pick-N-Pull Auto Dismantlers | Address: | World Headquarters | |
| 0000 Xxxxxxxx Xxxx. | Xxx Xxxxxxxx Xxxx | |||
| Xxxxxxxxxx, XX 00000 | Dearborn, Michigan 48126-2798 | |||
| Attention: Xxxx Xxxxxxxx | Attention: Corporate Secretary | |||
| Facsimile: (000) 000-0000 | Facsimile: (000) 000-0000 |
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