EXHIBIT 2.2
CONTRACT FOR SALE
AGREEMENT made this 6th day of June, 1997, between XXXX-XXXXXXXXX FORD,
INC. ("Corporation"), XXXXXXX XXXXXXXXX ("Shareholder") and XXXXXX ACQUISITIONS,
INC., or its assigns ("Buyer").
The parties have reached an understanding with respect to the sale and
purchase of all of the issued and outstanding common stock of Corporation (the
"Stock"), and the obligations of Corporation, Shareholder and Buyer in
connection therewith.
IT IS THEREFORE AGREED:
1. PURCHASE PRICE. The Shareholder agrees to sell, and the Buyer agrees
to purchase, all of the Stock and as consideration therefor to pay Eight Million
Dollars ($8,000,000.00) plus the FIFO net book value (as such term is used in
the retail automobile sales business) of the Corporation as reflected in the
Closing Date Balance Sheet (as defined below) subject to adjustment as provided
below in Paragraph 3, to be paid as follows:
(a) One Hundred Thousand Dollars ($100,000.00) shall be paid as a
deposit in Trust to Xxxxxx & Xxxxx LLP, to be held pursuant to the
terms of this Agreement.
(b) Four Million Nine Hundred Thousand Dollars ($4,900,000.00) plus
the deposit shall be paid in cash (to the Shareholder) upon the
Closing; and
(c) A promissory note (in the form attached as EXHIBIT "A") in the
amount of the balance of the purchase price shall be delivered to
the Shareholder upon the Closing. The promissory note shall bear
interest at the prime rate of interest of SunTrust Banks, Orlando,
Florida, and the note shall be due and payable in a lump sum on the
earlier of (i) the date of an Initial Public Offering (IPO) of an
affiliate of the Buyer, or (ii) one (1) year from the Closing Date.
In the event an IPO occurs within one (1) year of the Closing Date,
One Million Dollars ($1,000,000.00) of the principal amount of the
note shall, at the Buyer's election, be payable in unregistered
stock of the IPO entity on the effective date of the IPO, bearing
the restrictive legend customarily placed on securities that have
not been registered under applicable state and federal securities
laws and the balance of the note, together with all accrued unpaid
interest thereon, shall be paid in cash to the Shareholder. If
requested by Shareholder, Buyer shall provide a letter of credit or
equivalent security acceptable to Shareholder as security for the
amount of the promissory note, and Buyer agrees to execute all
appropriate security documents, including without limitation, a
security agreement and financing statement to evidence the security
given to the Shareholder; provided,
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however no additional security shall be required in the event Buyer
provides a letter of credit.
2. XXXXXXX MONEY. Buyer has paid herewith to Xxxxxx & Xxxxx, L.L.P, as
Escrow Agent, an xxxxxxx money deposit in the sum of One Hundred Thousand
Dollars ($100,000.00) in connection with the transaction contemplated hereby.
The xxxxxxx money shall be held pursuant to an Escrow Deposit Agreement (in the
form attached as EXHIBIT "B") and invested in a non-interest or interest bearing
account pending its disposition in accordance with the terms of this Agreement.
3. CONDITIONS. (a) The purchase price for the Stock set forth in
Paragraph 1 above is based on the FIFO net book value of the Corporation, which
Shareholder represents to the Buyer will be Two Million Eight Hundred Thousand
Dollars ($2,800,000) as of the Closing. The Buyer may cause to be taken a
physical inventory of the assets of the Corporation prior to Closing, and Buyer
and Shareholder shall agree upon a balance sheet as of the date of Closing (the
"Closing Date Balance Sheet"). The purchase price shall be adjusted upwards by
the amount by which the FIFO net book value of the Corporation as determined in
the Closing Date Balance Sheet is greater than Two Million Eight Hundred
Thousand Dollars ($2,800,000) and adjusted downwards by the amount by which the
FIFO net book value of the Corporation as determined in the Closing Date Balance
Sheet is less than Two Million Eight Hundred Thousand Dollars ($2,800,000).
(b) In determining the FIFO net book value of the Corporation for
purposes of the Closing Date Balance Sheet, Generally Accepted Accounting
Principles, consistently applied shall be utilized by the parties. In the event
the Buyer and Shareholder cannot agree on the Closing Date Balance Sheet, they
shall each choose a certified public accountant to whom they shall submit the
items in dispute for a determination by said accountant(s) which shall be
binding on Shareholder and Buyer. If the two accountants so selected cannot
agree and the difference exceeds $100,000, they shall select a third certified
public accountant whose decision shall be final. For purposes of this Agreement
the following methods of valuation shall be deemed to be in accordance with
Generally Accepted Accounting Principles for the purpose of determining the
amounts to be reflected on the Closing Date Balance Sheet:
(1) PARTS, ACCESSORIES, AND MISCELLANEOUS SUPPLIES. All the new,
genuine, original, unopened, current and unused Ford factory parts and
accessories which could be returned to the manufacturer by the
Corporation shall be valued at a price as defined in subparagraph (A)
below. Damaged or obsolete parts shall not be required to be included
in the valuation and if any such parts are excluded they shall be
distributed to the Shareholder. The Corporation's miscellaneous service
supplies and inventories shall be valued at the Corporation's cost of
such items. Said items shall appear on an inventory list prepared by
Buyer and Corporation prior to the Closing Date. The inventory list
shall be incorporated herein and made a part hereof the same as if
fully set forth herein and designated as SCHEDULE "1".
(A) Buyer and Corporation shall determine the value for the
parts referenced in Paragraph (1) above, per an inventory at prices
which shall be determined by the most current Manufacturer's Parts
Catalog Price prior to Closing. Buyer may include in the valuation
any parts and inventories not required to be
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purchased by Paragraph 1 as shall be determined by good faith
negotiations between Buyer and Shareholder. Shareholder agrees that
no additions or deletions shall be made in such stocks except in
the ordinary course of Corporation's business, and further, to keep
adequate records of such additions and deletions, which records
shall be made available to Buyer for review and verification upon
reasonable request. Buyer and Shareholder shall each pay for
one-half (1/2) of the cost of the inventory if an independent
inventory service is engaged by the parties to complete the
physical inventory.
(2) NEW VEHICLES. The 1997 and later years new and warrantable Ford
vehicle inventory and up to five (5) Ford demonstrator vehicles shall
be valued at a price equal to the sum of Corporation's original factory
invoice cost plus the cost of dealer installed items and less any
rebates, holdbacks (including supplemental holdback or year end
carryover allowances), incentive payments (including incentives and
advertising allowances) paid or payable to Corporation prior to the
Closing by the manufacturer for any reason except interest credit
support with respect to these vehicles or pre-delivery inspection
credits received if the work is not performed as of Closing. For the
purpose of the foregoing provisions, the cost of dealer installed items
shall be equal to the Corporation's actual cost of the installed item
plus labor charges for installation computed at the charge customarily
placed on Corporation's vehicle inventory records.
(A) It is further agreed that in the event any vehicle
referred to in this paragraph shall have been damaged prior to the
Closing, Corporation shall have repaired such vehicle to the
satisfaction of Buyer, or in the event any such vehicle has not
been repaired, Corporation and Buyer shall agree on the cost to
recover such repairs, which cost shall be deducted from the value
referred to herein. In the event Corporation and Buyer cannot agree
on the cost of repairs, Buyer shall have no obligation to include
in the valuation any such vehicle or vehicles and Shareholder shall
be provided title to such specific vehicles. Further, Buyer may
include in the valuation in connection with the determination of
the purchase price, 1996 new Ford and any warrantable demonstrator
Ford vehicles (in excess of five (5) vehicles) at such actual cash
price for each vehicle as shall be determined by good faith
negotiations between Buyer and Corporation. In the event of a
failure of the parties to agree on such vehicle values, Buyer may
elect not to include in the valuation such specific vehicles, in
which case Shareholder shall be provided title to such specific
vehicles. Any new vehicle with over 200 miles on the odometer shall
be considered a demonstrator vehicle. The new and demonstrator
automobiles to be valued pursuant to this paragraph shall be listed
in SCHEDULE "2"-NEW AND DEMONSTRATOR INVENTORY to be prepared by
Corporation and Buyer prior to the Closing and initialed by them at
the Closing. Said Exhibit shall show the value of each vehicle
computed as set forth above.
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(3) USED VEHICLES. The valuation of Corporation's used
vehicle inventory as of the Closing shall be at such actual cash
wholesale value for each vehicle as shall be determined by good
faith negotiations between Buyer and Shareholder. In the event of a
failure to agree on the aggregate of the entire used vehicle
inventory, none of the used vehicles shall be included in such
inventory, and Shareholder shall be provided title to all used
vehicles. The used automobiles to be valued pursuant to this
paragraph shall be listed in SCHEDULE "3"-USED VEHICLES INVENTORY
to be prepared by Corporation and Buyer prior to the Closing and
initialed by them at the Closing. Said Exhibit shall show the
agreed valuation price of each vehicle.
4. EXAMINATION OF RECORDS. For a period of 30 days after the execution
of this Agreement, Corporation will allow the Buyer, its counsel and other
representatives of Buyer full access during normal business hours, or such other
reasonable times, to all the books, tax returns, both federal, state and local,
records, files, documents, assets, properties, contracts and agreements of the
Corporation, and Corporation shall furnish the Buyer, its officers and
representatives with all information concerning the affairs of such Corporation
which may be reasonably requested. The Buyer agrees that it will use its best
efforts to prevent its review of the foregoing materials from causing any
disruption of the business of the Corporation. The Buyer shall exercise its
general rights under this provision to ascertain that the business is generally
as represented by the financial statement of the Corporation dated March 31,
1997, which has been furnished to Buyer. The Buyer may, on or before thirty (30)
days from the date of this Agreement, cancel this Agreement if the results of
the Buyer's investigation reveal material discrepancies from that represented in
the financial statements and in such event the xxxxxxx money deposit paid
herewith shall be returned to the Buyer.
5. FAILURE TO CONSUMMATE SALE. In the event the Buyer fails to
consummate the purchase of the Stock from the Shareholder for any reason except
that described in Paragraph 4 or the failure of a condition precedent as set
forth in Paragraph 11, the xxxxxxx money deposit paid this date shall be
forfeited and shall be paid to the Shareholder as liquidated damages. In the
event the Shareholder fails to consummate the sale of the Stock for any reason
except the default of Buyer under this Agreement, the Buyer may require specific
performance of this Agreement by the Corporation and Shareholder in any court of
competent jurisdiction, in addition to any other rights or remedies which Buyer
may have at law or in equity.
6. CLOSING. The closing of the sale shall take place at the offices of
the Corporation in Panama City, Florida, or such other place mutually agreed by
the parties on or before forty-five (45) days after the date of execution
hereof, unless extended by the mutual written agreement of Buyer and
Shareholder. At the Closing, Shareholder shall deliver to the Buyer, free and
clear of all liens, encumbrances and restrictions, an assignment of the Stock,
an updated title commitment reflecting no changes from that provided in
Paragraph 11(c) below, the Shareholder's resignation as Ford Dealer-Operators,
if requested, and such other documents as required by this Agreement. Upon such
delivery, the Buyer shall deliver to the Shareholder, a certified or cashier's
check payable to the order of the Shareholder or a wire transfer of funds fully
completed to an account and bank as directed by the Shareholder for the total
purchase price, less the amount of the xxxxxxx money deposit, together with
interest thereon, previously paid hereunder, and less the face amount of the
promissory note, and increased or decreased, as applicable, by the amount of any
adjustments as provided in Paragraph 3.
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7. REPRESENTATIONS AND WARRANTIES. The Corporation and Shareholder,
jointly and severally, represent and warrant as follows:
(a) ORGANIZATION AND STANDING OF CORPORATION. The Corporation is
duly organized, validly existing and in good standing under the laws of the
State of Florida. Copies of the Corporation's Articles of Incorporation and all
amendments thereof to date, certified by the Secretary of State of Florida, and
of the Corporation's Bylaws as amended to date, certified by the Corporation's
Secretary, shall be delivered to the Buyer, and are complete and correct as of
the date of this Agreement.
(b) OWNERSHIP. Shareholder is the owner, free and clear of any
liens, restrictions, encumbrances or rights of others, of all of the Stock.
Shareholder has full right and authority to transfer said Stock to the Buyer,
and there are no other shares of the Corporation owned or claimed to be owned by
any other person or entity.
(c) FINANCIAL STATEMENTS. Corporation has delivered to Buyer a copy
of the financial statements of the Corporation as of March 31, 1997, a copy of
which is attached as EXHIBIT "C" which present a true and complete statement of
the Corporation's financial condition as of that date and an accurate
representation of the results of the Corporation's operations for the period
indicated and an accurate description of the Corporation's assets, fixed or
otherwise. The financial statements have been prepared in accordance with
Generally Accepted Accounting Principles consistently applied, and which are to
be consistently applied through and including the Closing, except for the
reserves reflected on such financial statements which are not in accord with
Generally Accepted Accounting Principles and which shall be eliminated prior to
Closing. All assets so described are correct and will remain so until Closing,
except as might be affected by normal business operations of the Corporation.
(d) ABSENCE OF UNDISCLOSED LIABILITIES. Except to the extent
reflected or reserved against in the March 31, 1997 financial statements, the
Corporation had no material liabilities of any nature, whether accrued,
absolute, contingent, or otherwise, including tax liabilities due or to become
due and arising out of transactions entered into or any state of facts existing
prior thereto. Corporation warrants that there are no material liabilities of
any nature or any material amount not fully reflected or reserved against in
said statements. Further, all liabilities of the Corporation shall be current as
of the date of Closing and reserved for in the Closing Date Balance Sheet. For
purposes of this Agreement, the term material shall refer to any individual
liability of $2,000.00 or more, or aggregate liabilities of the Corporation in
excess of $10,000.00 or more.
(e) ABSENCE OF CERTAIN CHANGES. Except as set forth in EXHIBIT "D",
from March 31, 1997, and continuing through the date of Closing, the Corporation
further represents that there has not been (i) any material change in the
Corporation's financial condition, assets, liabilities or business, other than
changes in the ordinary course of business, none of which have been materially
adverse; (ii) any material damage, destruction or loss, whether or not covered
by insurance, materially and adversely affecting the Corporation's properties or
business; (iii) any direct or indirect redemption, purchase or other acquisition
of any such shares; or (iv) any labor strike of the
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Corporation by its employees, or any event or condition of any character,
materially and adversely affecting the Corporation's business or prospects.
(f) TITLE TO PROPERTIES. The Corporation has good and marketable title
to all of its properties and assets, real and personal, including those
reflected in the balance sheet of March 31, 1997 [except those sold or otherwise
disposed of in the ordinary course of business], subject to no security
interests, mortgage, pledge, lien, encumbrance or charge, except for liens shown
on the Balance Sheet as securing specified liabilities set forth therein (with
respect to which no default exists).
(g) CONDITION OF PROPERTY. All of Corporation's buildings, improvements
and equipment are in good operating condition and repair as of the date hereof
and shall be as of the date of Closing, shall be in conformity with all
applicable ordinances and regulations, and environmental, building, zoning,
occupational safety and other laws. Buyer shall have the right at any time prior
to Closing to inspect such equipment and ascertain its condition. Such equipment
is all the equipment necessary for the operation of the Corporation's business
in accordance with Ford Motor Company dealer guidelines, and all equipment
currently used in the Corporation's business is owned or leased by Corporation.
(h) ACCOUNTS RECEIVABLE. (i) Corporation shall deliver to Buyer a true
and complete list, certified by Corporation, of the Corporation's accounts
receivable within ten (10) days of the date of Closing. Following the Closing,
if any of such accounts receivable, or any accounts receivable arising between
the date of such listing and the Closing are not paid in full on or before 90
days after their due date, Shareholder shall reimburse the Corporation for all
such uncollected receivables in excess of the debt reserve, set forth on the
Closing Date Balance Sheet.
(ii) Buyer shall cause diligent effort to be made to collect all
such receivables, including where necessary, filing of appropriate notices and
liens under applicable Florida and federal law. Buyer shall, at Shareholder's
request, periodically furnish Shareholder with a schedule of unpaid accounts
receivable from transactions occurring prior to the Closing Date more than
ninety (90) days past due, setting forth each debtor's name, address and account
balance, and shall furnish, at Shareholder's request, a schedule setting forth
the action being taken to collect any such accounts receivable. Collection
procedures and any costs thereof shall be borne by the Corporation and deducted
from any proceeds, shall be agreed upon by Buyer and Shareholder prior to any
litigation or Corporation shall not be obligated to undertake any such actions.
Upon payment by Shareholder as aforesaid, Buyer shall cause such accounts to be
assigned to Shareholder.
(i) REAL ESTATE.
(i) Corporation has good, indefeasible and marketable title in
fee simple to the real estate owned by the Corporation (the "Property'), free
and clear of all liens, encumbrances,
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covenants and conditions, save and except taxes and assessments for the year
1997 and subsequent years and except for such mortgage or liens showing on the
Corporation's financial statements. Such title will be insured by a title
insurance company of recognized financial responsibility authorized to do
business in the State of Florida, at regular rates and without exception, except
for easements which benefit the Property.
(ii) There are no persons other than Corporation having any
right to occupy the Property.
(iii) For a period of 30 days after the date hereof,
Corporation represents that Buyer shall have the right to have the said
foundation, roof, electrical systems, air conditioning and heating systems,
plumbing and sprinkler systems, if any, examined by persons or entities licensed
under Florida law to ascertain whether or not the same or any part thereof have
been damaged or are defective in any material manner.
(iv) No rents or leases have been assigned, hypothecated or
pledged.
(v) Corporation has received no notice of any violation of law
or ordinances, orders, requirements or regulations of any federal, state, county
and municipal or other governmental or quasi-governmental department, agency or
authority relating to the Property or the use and operation thereof; and
Corporation has no reason to believe that any such notice has been, may or will
be sent or entered. To the best of Corporation's knowledge, Corporation has
complied with, and the Property and the use and operation thereof is in
compliance with, all laws, ordinances, orders, requirements, or regulations of
any federal, state, county and municipal or other governmental or
quasi-governmental department, agency or authority relating to the Property or
the use and operation thereof.
(vi) There are no oil burners and oil hot water heaters or
other fuel burning devices installed or in use on the Property.
(vii) All water, sewer, gas, electric, telephone and drainage
facilities and all other utilities and public or quasi-public improvements upon
or adjacent to the Property required by law or for the normal operation of the
improvements on the Property are installed, are connected under valid permits,
are in good working order, are adequate to serve the Property and are fully paid
for, and neither the Property nor the owner thereof has any further obligation
to pay any charge for or with respect to such public or quasi-public
improvements except general real estate taxes and usage charges. There are no
existing facts or conditions known to Shareholder which could result in the
termination of any utility service to the Property. Shareholder further
represents and warrants that neither Shareholder, Corporation nor their agents
or affiliates have received any notice from any utility company or public or
quasi-public organization which would indicate that any of the aforementioned
statements with respect to the utility services for the Property are incorrect.
(viii) No asbestos-containing materials are or were installed
in any improvements on the real property at any time, and the improvements on
the property contain no
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asbestos-containing materials except as disclosed in the environmental report
previously obtained by Corporation and disclosed to Buyer.
(ix) Except as disclosed on EXHIBIT "E", the Corporation has
not received any request for information, notice of claim, demand or other
notification that it is or may be potentially responsible with respect to any
investigation or clean-up of hazardous, toxic or polluting substances; except in
accordance with applicable regulations, the Corporation has not treated, stored
for more than ninety (90) days, recycled or disposed of any hazardous, toxic or
polluting substances on the Property, and to the best of Corporation's
knowledge, no other person has treated or stored for more than ninety (90) days,
substances on any such property; no PCB's, asbestos or urea formaldehyde
insulation is present at any property owned or leased by and of the Corporation;
and there are no underground storage tanks, active or abandoned, on the
Property.
(x) To the best of its knowledge, the Corporation has complied
with and is not in violation of any federal, state or local law, regulation,
permit, provision or ordinance relating to the generation, storage,
transportation, treatment or disposal of hazardous, toxic or polluting
substances; has obtained and adhered to all necessary permits and other
approvals necessary to store, dispose, and otherwise handle hazardous, toxic and
polluting substances; has reported, to the extent required by federal, state and
local law, all past and present sites where hazardous, toxic or polluting
substances, if any, from the Corporation have been treated, stored or disposed.
To the best of its knowledge, the Corporation has not transported any hazardous,
toxic or polluting substances or arranged for the transportation of such
substances to any location which is listed or proposed for listing under the
Comprehensive Environmental Response Compensation and Liability Act of 1980, as
amended ("CERCLA"), the Resource Conservation and Recovery Act, as amended,
("RCRA"), or the Clean Water Act, as amended, ("CWA") or which is the subject of
federal, state or local enforcement actions or other investigations which may
lead to claims against the Corporation for clean-up costs, remedial work,
damages to natural resources or for personal injury claims, including, but not
limited to, claims under CERCLA, RCRA or the CWA which could lead to a claim
being made against Buyer or Corporation.
(j) WORKING CAPITAL. The Corporation shall have sufficient Working
Capital, as defined by Ford Motor Company standards applicable to the
Corporation, on the date of this Agreement and continuing through the date of
Closing, to meet the most recent requirements of Ford Motor Company prior to the
date of this Agreement.
(k) CONTRACTS. The Corporation has no contract or commitment
extending beyond the Closing Date, or involving payment by the Corporation of
more than $20,000.00 in the aggregate, except those listed on the attached
EXHIBIT "F" which is made a part hereof. True and complete copies of all listed
contracts have been delivered to the Buyer. The Corporation has complied with
all the material provisions of all such contracts and commitments to which it is
a party, and is not in default under any of them nor will the execution of this
Agreement result in a default under any of such contracts.
(l) TAX RETURNS. From the date hereof, and up to and including the
Closing, the Corporation has paid or will timely pay when due all due and
payable income, social security,
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withholding, sales, use, unemployment insurance and other taxes to all city,
state and federal governments, and has paid or will timely pay, all due and
payable premiums in satisfaction of their statutory obligations for workers'
compensation insurance coverage. The Corporation has duly filed all federal,
state and other tax returns required to be filed by it. All taxes, assessments
and other governmental charges at any time known by the Corporation prior to the
date hereof, to be due from or upon the Corporation or any of its income,
property or assets have been duly paid, and no extensions for the time of
payment have been requested. The Corporation has paid, or provided in its books,
accruals or reserves adequate for the payment of all federal, state and other
income, franchise and other tax liabilities relating to any actions taken by
Corporation through the date of Closing. Shareholder hereby warrants and
indemnifies Buyer or Corporation as to any future tax deficiencies, penalties
and interest of Corporation not otherwise reserved for, relating to any
transaction or event taking place prior to the Closing.
(m) DIRECTOR AND OFFICERS; COMPENSATION; BANKS. The Corporation
shall deliver to the Buyer within ten (10) days of the date of this Agreement a
true and complete list, as of the date of this Agreement, certified by the
Corporation's treasurer, showing: (i) the names of all the Corporation's
directors and officers; (ii) the names and title of all persons whose are
employed by the Corporation together with a statement of the full amount
presently paid or payable to each such person for services rendered; (iii) the
name of each bank in which the Corporation has an account or safe deposit box,
and the names of all persons authorized to draw thereon, or to have access
thereto; and (iv) the names of all persons holding powers of attorney from the
Corporation and a summary statement of the terms thereof.
(n) LITIGATION. Except as disclosed on EXHIBIT "G" for suits of a
character incident to the normal conduct of the Corporation's business and
involving not more than $2,500.00 in the aggregate, there is no litigation or
proceeding pending, or to the Corporation's knowledge threatened, against or
relating to the Corporation, its properties or business, nor does the
Corporation know or have reasonable grounds to know of any basis for any such
action, or of any governmental investigation relative to the Corporation, its
properties or business.
(o) LEASES, CONTRACTS AND LICENSES. Corporation represents and
warrants that the transfer of the Stock in accordance with the terms of this
Agreement will not constitute a prohibited assignment or transfer of any of the
licenses, leases or contracts of the Corporation, and that all of the foregoing
will remain in full force and effect without acceleration as a result of this
transaction. Notwithstanding the foregoing, the parties acknowledge and agree
that Ford Motor Company is required to acknowledge and consent to the Buyer as
an acceptable owner of the Corporation together with its shareholders.
(p) DISCLOSURE. To the best of the knowledge of the Corporation
and/or Shareholder, after due investigation, no representation or warranty by
the Corporation and/or Shareholder in this Agreement, nor any statement or
certificate furnished or to be furnished to the Buyer pursuant hereto, or in
connection with the transactions contemplated hereby, contains or will contain
any untrue statement of a material fact, or omits or will omit to state a
material fact necessary to make the statements contained herein or therein not
misleading.
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(q) LABOR MATTERS. Within the last three (3) years, Corporation has
not been the subject of any union activity or labor dispute, nor has there been
any strike of any kind called, or threatened to be called against Corporation
and, to the best of its knowledge, Corporation has not violated any applicable
federal or state law or regulation relating to labor or labor practices, and is
not a party to any collective bargaining agreement.
(r) PROFIT SHARING AND BENEFIT PLANS. Except as disclosed on EXHIBIT
"H", there are no employee benefit plans and agreements maintained by
Corporation for the benefit of its shareholders, officers, directors or
employees. There are no contributions or payments due with respect to such plans
or agreements, nor will any such contributions or payments be due or required to
be paid on or prior to the Closing Date. To the best of its knowledge,
Corporation is in compliance in all respects with the presently applicable
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). To the best of its knowledge, no event which constitutes a reportable
event as defined in Section 4043 of ERISA has occurred and is continuing with
respect to any plan covered by ERISA. To the best of its knowledge, there would
be no liability of Corporation under Subtitle D of Title IV of ERISA if any plan
were terminated as of the Closing Date, and Corporation has not incurred any
withdrawal liability to any multi-employer plan and does not have any contingent
withdrawal liability to any multi-employer plan under ERISA, as amended by the
Multi-employer Pension Plan Amendments Act of 1980.
(s) DEALER AGREEMENT. No default presently exists under the
Corporation's Dealer Agreement with Ford Motor Company and Corporation is in
good standing under such Dealer Agreement. Neither the Corporation or
Shareholder has any knowledge of a material change in Ford Motor Company
marketing strategy in its area or the granting of any additional Ford dealership
points, which are not already open and operating, within a fifty (50) mile
radius of Bay County, Florida.
(t) GUARANTEES. Corporation is not a guarantor, surety, endorser or
accommodation party for any third party, or otherwise obligated for the debt of
any person except as reflected in the March 31, 1997 Financial Statements.
8. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
warrants to Shareholder and the Corporation as follows:
(a) INCORPORATION. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Florida.
(b) AUTHORIZATION. Buyer has full legal right and corporate power to
enter into and deliver this Agreement and to consummate the transactions set
forth herein and to perform all the terms and conditions hereof to be performed
by it. This Agreement has been duly executed and delivered by Buyer and is a
legal, valid and binding obligation of Buyer enforceable in accordance with its
terms, except as limited by applicable bankruptcy, moratorium, insolvency, or
other laws affecting generally the rights of the creditors or by principals of
equity. The execution and delivery of this Agreement by Buyer and the
performance by Buyer of the transactions contemplated herein have been duly and
validly authorized by all requisite corporate action of Buyer.
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(c) BROKERS AND FINDERS. No broker or finder has acted for Buyer in
connection with this Agreement or the transactions contemplated by this
Agreement and, no broker or finder is entitled to any brokerage or finder's fee
or to any commission in respect thereof based in any way on agreements,
arrangements or understandings made by or on behalf of Buyer.
(d) CONSENTS AND APPROVALS. Neither the execution and deliver by
Buyer of this Agreement, nor the consummation by Buyer of the transactions
contemplated hereby, nor compliance by Buyer with any of the provisions hereof
will (i) violate or conflict with any provision of the Certificate of
Incorporation or Bylaws of Buyer, (ii) result in a violation of any order, writ,
injunction, decree, judgment, ruling, law, rule, or regulation of any court or
governmental authority, applicable to Buyer, (iii) result in the breach of any
note, bond, mortgage, indenture, deed of trust, trust, license, franchise,
permit, contract, agreement or other instrument or commitment or obligation of
Buyer, or (iv) require any consent, approval, authorization of, or notice to, or
declaration, filing or registration with, any governmental or regulatory
authority or any other Person, except for such consents, approvals,
authorizations, notices, declarations, filings or registrations which have been
obtained, given or made, as the case may be, and which are unconditional and in
full force and effect.
(e) LITIGATION. There are no claims, actions, suits, inquiries,
investigations or proceeding pending, or to the best of the knowledge of Buyer
threatened or imminent, against Buyer which question or challenge the validity
of this Agreement or any action taken or to be taken by Buyer pursuant hereto
(other than any such claim, action, suit, inquiry, investigation or proceeding
to which the Shareholder or their affiliates are a party or otherwise involved)
before or by any court or governmental body.
(f) NO MISREPRESENTATION OR OMISSION. No representation or warranty
by the Buyer in this paragraph, or in any SCHEDULE, contains or will contain any
untrue statement of a material fact or omits or will omit to state a material
fact necessary to make the statements contained therein not misleading.
9. CONDUCT OF BUSINESS PENDING CLOSING. The Shareholder and Corporation
covenant that, pending the Closing:
(a) The Corporation's business will be conducted only in the
ordinary course and there shall be no acceleration of payment of any contract or
change in rate of compensation payable to any employee in the form of a bonus or
otherwise, other than commitments previously disclosed to Buyer in writing.
(b) No change will be made in the Corporation's Articles of
Incorporation or Bylaws, except as may be first approved in writing by the
Buyer.
(c) No change will be made in the Corporation's authorized or issued
corporate
12
shares.
(d) No contract or commitment will be entered into by or on behalf
of the Corporation, except normal commitments for the purchase of inventory,
parts and supplies, without the Buyer's written approval.
(e) No change will be made affecting the personnel, or banking or
safe deposit arrangements of the Corporation without the Buyer's written
approval.
(f) Except as otherwise requested by the Buyer, the Shareholder will
cause the Corporation to use its best efforts (without making any commitment on
the Buyer's behalf) to preserve the Corporation's business organization intact;
to keep available to the Corporation the services of its present employees; and
to preserve for the Corporation the goodwill of its suppliers, customers, and
others having business relations with the Corporation.
(g) All debts will be paid as they become due.
(h) No contract right of the Corporation will be waived without
Buyer's written approval.
(i) No uninsured material physical damage for loss will occur to the
assets of the Corporation.
(j) No obligations except current liabilities under contracts
entered into the ordinary course of business will be incurred without Buyer's
written approval.
10. CORPORATION PERSONNEL. Except as to the Shareholder or as otherwise
is provided in the Shareholder's Employment Agreement or as may be required by
law, the Buyer shall have no obligation to employ Corporation's personnel after
the Closing.
11. CONDITIONS PRECEDENT. All obligations of the Buyer under this
Agreement, are, at its option, subject to the fulfillment, prior to or at the
Closing, of each of the following conditions:
(a) FORD MOTOR COMPANY APPROVAL. Approval of the transaction by Ford
Division of Ford Motor Company of the Buyer or its designee as the
Dealer/Operator. The parties agree to use their best efforts to obtain such
approval.
(b) FINANCING. Corporation shall have obtained floor-plan financing
in an amount sufficient to permit the Corporation to operate a Ford Dealership
on terms as may be prevailing at the time of Closing. Buyer shall use reasonable
efforts to cause the Corporation to obtain such financing, and the Letter of
Credit and other funds referenced in Paragraph 1 above.
(c) TITLE BINDER.
(i) Not later than twenty (20) days after the execution of this
Agreement, Buyer shall obtain at Shareholder's expense a title insurance binder
(ALTA Form B) issued by a company reasonably acceptable to Buyer, agreeing to
insure title in the Property with respect to a fee
12
simple interest in Corporation's present facility in an amount of not less than
One Million Dollars ($1,000,000.00), together with copies of all exceptions to
title. Other than taxes for the year 1997 and subsequent years, Buyer shall have
the unqualified right to approve all exceptions and matters of title, which
shall in all respects be satisfactory to Buyer.
(ii) Within ten (10) days after receipt of the binder, Buyer's
counsel shall notify Corporation's counsel in writing of any matters in the
binder which are unacceptable. Corporation shall then have twenty(20) days to
cure defects or otherwise satisfy Buyer's concerns or to notify Buyer that the
alleged defects cannot be cured by the exercise of reasonable diligence and/or
the expenditure of not more than $100,000.00. If Corporation so notifies Buyer,
Buyer shall have ten (10) days to cancel this Agreement and receive a refund of
the xxxxxxx money deposit and all accrued interest or to waive the alleged
defects and close.
(d) XXXX-XXXXX-XXXXXX ANTITRUST ACT. All applicable waiting periods
related to the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 0000 (xxx "XXX
Xxx") shall have expired.
(e) REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. The
Corporation's and Shareholder's representations and warranties contained in this
Agreement shall be true in all material
respects at the time of Closing.
(f) PERFORMANCE. The Corporation shall have performed and complied
with all agreements and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing.
(g) OFFICER'S CERTIFICATE. The Corporation has delivered to the
Buyer a certificate of the Corporation's president and treasurer, certified by
the Corporation's secretary, dated the Closing Date, certifying to the
fulfillment of the conditions specified in subparagraphs (b) and (c) of this
paragraph.
(h) OPINION OF CORPORATION'S COUNSEL. The Corporation shall have
delivered to the Buyer an opinion of the Corporation's counsel, Xxxx X.
Xxxxxxxx, 000 Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxx 00000, dated the Closing Date,
that the Corporation's corporate existence, good standing, and authorized and
issued stock are as stated in subparagraphs (a) and (b) of paragraph 7; and
that, except as may be specified by such counsel, he does not know or have any
reasonable grounds to know of any litigation, proceeding, or governmental
investigation pending or threatened against, or relating to, the Corporation,
its properties, or business.
(i) HAZARDOUS WASTE INSPECTION. Within five (5) days of the date of
full execution hereof, Buyer shall request a hazardous waste report (the
"Report") from a registered environmental engineer to be delivered to Buyer. If
the Report discloses that the Property or underlying ground water is
contaminated with any hazardous or toxic substances, wastes, materials,
pollutants or contaminants, Buyer shall have the right to terminate this
Agreement and receive a refund of the Deposit. In the event that Buyer elects to
terminate this Agreement, said election to terminate shall be of no force and
effect if Corporation, within seven (7) days of receipt of Buyer's termination
notice, notifies Buyer that it shall remove the hazardous substances from the
said property at its sole
13
cost and expense. If Corporation elects to remove the hazardous substances it
shall be obligated to remove the hazardous substances from the contaminated area
in accordance with applicable statutes, rules, ordinances and regulations which
govern clean up of hazardous substances. In the event of an election by
Corporation to clean up the Property, Corporation must provide Buyer with a
certificate from a registered environmental engineer which states that any and
all substances which have contaminated the Property or the underlying ground
water have been removed in accordance with all applicable regulations.
12. INDEMNIFICATION. The Shareholder shall indemnify and hold harmless
the Corporation and the Buyer, at all times after the date of Closing of this
Agreement, against and in respect of:
(a) UNDISCLOSED LIABILITIES. All material liabilities of the
Corporation of any nature, whether accrued, absolute, contingent, or otherwise,
existing at Closing or thereafter arising out of facts or transactions existing
or taking place prior to Closing, to the extent not reflected or reserved
against in full in the Corporation's Closing Date Balance Sheet, including,
without limitation, any tax liabilities to the extent not so reflected or
reserved against, accrued in respect of, or measured by the Corporation's income
for any period prior to Closing, or arising out of transactions entered into, or
any state of facts existing, prior to such date;
(b) INTERIM LIABILITIES. All material liabilities of, or claims
against, the Corporation arising out of the conduct of the Corporation's
business between March 31, 1997, and the Closing otherwise than in ordinary
course, or arising out of any presently existing contract or commitment of the
character described in subparagraph (k) of paragraph 7 and not listed therein,
or arising out of any contract or commitment entered into or made by the
Corporation between the date hereof and the Closing except as permitted by the
provisions of subparagraph (d) of paragraph 7 and not reflected on the Closing
Date Balance Sheet;
(c) MISREPRESENTATION. Any damage or deficiency resulting from any
material misrepresentation, breach of warranty, or nonfulfillment of any
agreement on the part of the Corporation and/or Shareholder under this
Agreement, or from any misrepresentation in or omission from any certificate or
other instrument furnished or to be furnished to the Buyer hereunder; and
(d) INCIDENTAL EXPENSES. All actions, suits, proceedings, demands,
assessments, judgment, costs, attorneys' fees (including appellate and
bankruptcy proceedings), and expenses incident to any of the foregoing.
(e) CLAIMS AGAINST THE SHAREHOLDER.
(1) In the event that Buyer seeks recourse to satisfy an
indemnification obligation of Shareholder to Buyer pursuant to Paragraph 12 of
this Agreement, Buyer shall submit to Shareholder a written statement (an
"Indemnification Claim") conforming to the provisions of this Paragraph 12(e).
Each Indemnification Claim:
14
(i) shall set forth the matter as to which indemnification is
sought by Buyer, and the basis for Shareholder's indemnification
obligation pursuant to Paragraph 12 of this Agreement, and
(ii) shall set forth the total amount of losses, liabilities,
damages, cost and expenses suffered by Buyer with respect to such
matter (or if such total amount is not then capable of precise
determination, Buyer's good faith estimate of such total amount). The
total of the specified losses, liabilities, damages, costs and
expenses, or the total good faith estimate of such losses, liabilities,
costs and expenses as referred to herein shall constitute the "total
amount claimed" pursuant to such Indemnification Claim.
(2) Notice of all Indemnification Claims hereunder shall be given
within five (5) years of the Closing Date. Any Indemnification Claim as to which
notice is not given within such five year period shall not be effective under
this Agreement.
(3) In the event Shareholder reasonably objects, in good faith, in
whole or in part to any Indemnification Claim, Shareholder shall within fifteen
(15) calendar days after notice of an Indemnification Claim is given, deliver to
the Buyer a written statement (an "Objection") setting forth in reasonable
detail the basis of such objection, and the portion of the total amount claimed
by Buyer pursuant to such Indemnification Claim which Shareholder disputes (the
"Disputed Portion").
(4) PAYMENT OF INDEMNIFICATION CLAIMS. The Shareholder shall make
payments to the Buyer as follows:
(A) to Buyer of any portion of the Indemnification Claim that
is not disputed by Shareholder; or
(B) to Buyer pursuant to an Arbitrator's Final Order ordering
the Shareholder to make such payment; or
(C) to Buyer, in the total amount claimed pursuant to an
Indemnification Claim if Shareholder has not filed with Buyer an
Objection to such Indemnification Claim within the 15 day period set
forth in paragraph (e)(2) above.
(5) DISPUTES.
(i) Shareholder and Buyer agree to use their reasonable best
efforts to resolve by good faith negotiation any and all disputes
relating to an Indemnification Claim.
(ii) In the event that Buyer has made an Indemnification Claim
and Shareholder has delivered a timely Objection thereto, and if
Shareholder and Buyer are unable to resolve such dispute in accordance
with paragraph (5)(i) above within 10 calendar days after delivery of
Shareholder's Objection to such Indemnification Claim, then such
dispute shall be referred to arbitration for final determination. Such
arbitration shall be resolved
15
before a single arbitrator in Florida in accordance with the commercial
arbitration rules of the American Arbitration Association as then in
effect. If Buyer and Shareholder cannot within 15 calendar days after
the delivery of the Objection agree upon the selection of a single
arbitrator, counsel for Shareholder shall select the arbitrator. The
arbitrator shall allow Buyer and Shareholder to conduct reasonable
discovery pursuant to the Federal Rules of Civil Procedure. The costs
of arbitration shall be borne equally by Buyer and Shareholder except
as the arbitrator may otherwise direct. The decision of the arbitrator
(the "Arbitrator's Final Order") shall be binding on the parties to
this Agreement and may be entered by any party in any court of
competent jurisdiction. The determination of which party is the
prevailing party in any arbitration shall be at the discretion of the
arbitrator.
(f) In the event that all payables of Buyer to Shareholder have
been paid and the factory conducts any warranty or other type audit resulting in
factory charge backs relating to Shareholder's operation of the Business, then
Shareholder shall pay or reimburse Buyer for the amount of such charge backs
subject to Shareholder's opportunity to review and have same justified.
13. INDEMNIFICATION. The Buyer shall indemnify and hold harmless the
Shareholder, at all times after the date of Closing of this Agreement, against
and in respect of:
(a) UNDISCLOSED LIABILITIES. All material liabilities of the
Corporation of any nature, whether accrued, absolute, contingent, or otherwise,
existing at Closing or thereafter arising out of facts or transactions taking
place after the Closing, including any tax liabilities, accrued in respect of,
or measured by the Corporation's income for any period after Closing, or arising
out of transactions entered into, or any state of facts existing, after such
date;
(b) MISREPRESENTATION. Any damage or deficiency resulting from any
material misrepresentation, breach of warranty, or nonfulfillment of any
agreement on the part of the Buyer under this Agreement, or from any
misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished to the Shareholder hereunder; and
(c) INCIDENTAL EXPENSES. All actions, suits, proceedings, demands,
assessments, judgment, costs, attorneys' fees (including appellate and
bankruptcy proceedings), and expenses incident to any of the foregoing.
(d) CLAIMS AGAINST THE BUYER.
(1) In the event that Shareholder seeks recourse to satisfy an
indemnification obligation of Buyer to Shareholder pursuant to Paragraph 13 of
this Agreement, Shareholder shall submit to Buyer a written statement (an
"Indemnification Claim") conforming to the provisions of this Paragraph 13(d).
Each Indemnification Claim:
(i) shall set forth the matter as to which indemnification
is sought by Shareholder, and the basis for Buyer's indemnification
obligation pursuant to Paragraph 13 of this Agreement, and
16
(ii) shall set forth the total amount of losses,
liabilities, damages, cost and expenses suffered by Shareholder with
respect to such matter (or if such total amount is not then capable of
precise determination, Shareholder's good faith estimate of such total
amount). The total of the specified losses, liabilities, damages, costs
and expenses, or the total good faith estimate of such losses,
liabilities, costs and expenses as referred to herein shall constitute
the "total amount claimed" pursuant to such Indemnification Claim.
(2) Notice of all Indemnification Claims hereunder shall be
given within five (5) years of the Closing Date. Any Indemnification Claim as to
which notice is not given within such five year period shall not be effective
under this Agreement.
(3) In the event Buyer reasonably objects, in good faith, in
whole or in part to any Indemnification Claim, Buyer shall within fifteen (15)
calendar days after notice of an Indemnification Claim is given, deliver to the
Shareholder a written statement (an "Objection") setting forth in reasonable
detail the basis of such objection, and the portion of the total amount claimed
by Shareholder pursuant to such Indemnification Claim which Buyer disputes (the
"Disputed Portion").
(4) PAYMENT OF INDEMNIFICATION CLAIMS. The Buyer shall make
payments to the Shareholder as follows:
(A) to Shareholder of any portion of the Indemnification
Claim that is not disputed by Buyer; or
(B) to Shareholder pursuant to an Arbitrator's Final Order
ordering the Buyer to make such payment; or
(C) to Shareholder, in the total amount claimed pursuant to
an Indemnification Claim if Buyer has not filed with Shareholder an
Objection to such Indemnification Claim within the 15 day period set
forth in paragraph (d)(2) above.
(5) DISPUTES.
(i) Buyer and Shareholder agree to use their reasonable
best efforts to resolve by good faith negotiation any and all disputes
relating to an Indemnification Claim.
(ii) In the event that Shareholder has made an
Indemnification Claim and Buyer has delivered a timely Objection
thereto, and if Buyer and Shareholder are unable to resolve such
dispute in accordance with paragraph (5)(i) above within 10 calendar
days after delivery of Buyer's Objection to such Indemnification Claim,
then such dispute shall be referred to arbitration for final
determination. Such arbitration shall be resolved before a single
arbitrator in Florida in accordance with the commercial arbitration
rules of the American Arbitration Association as then in effect. If
Shareholder and Buyer cannot within 15 calendar days after the delivery
of the Objection agree upon the selection of a single arbitrator,
counsel for Buyer shall select the arbitrator. The arbitrator shall
allow Shareholder
17
and Buyer to conduct reasonable discovery pursuant to the Federal Rules
of Civil Procedure. The costs of arbitration shall be borne equally by
Shareholder and Buyer except as the arbitrator may otherwise direct.
The decision of the arbitrator (the "Arbitrator's Final Order") shall
be binding on the parties to this Agreement and may be entered by any
party in any court of competent jurisdiction. The determination of
which party is the prevailing party in any arbitration shall be at the
discretion of the arbitrator.
14. HSR ACT FILINGS. To the extent such filings have not been completed
prior to the execution of this Agreement, Buyer shall, in cooperation with the
Corporation and Shareholder, file or cause to be filed any reports or
notifications that may be required to be filed under the HSR Act, with the
Federal Trade Commission and the Antitrust Division of the Department of
Justice, and Corporation and Shareholder shall furnish to the others all such
information in their possession as may be necessary for the completion of the
reports or notifications to be filed. Prior to making any communication, written
or oral, with the Federal Trade Commission, the Antitrust Division of the
Federal Department of Justice or any other governmental agency or authority or
members of their respective staffs with respect to this Agreement or the
transactions contemplated hereby, the parties shall consult with each other.
Buyer shall assist Shareholder with the preparation of the filing and be
responsible for up to Five Thousand Dollars ($5,000.00) of Shareholder and
Corporation's fees and costs associated with this filing. Buyer shall use its
best efforts to obtain from the applicable governmental agency early termination
of the waiting period related to the H.S.R. Act filing.
15. BROKERAGE. The Corporation and Buyer each represent and warrant to
the other that except for Shareholder's agreement with NCM Associates, Inc., all
negotiations relative to this Agreement have been carried on by them directly
with each other, without the intervention of any person, and each party shall
indemnify the other and hold it harmless against and in respect of any claim for
brokerage or other commissions relative to this Agreement, or to the
transactions contemplated hereby, and also in respect of all expenses of any
character incurred by such party in connection with this Agreement or such
transactions.
16. NON-COMPETITION AGREEMENT AND CONSULTING CONTRACT. The Buyer
recognizes that the Shareholder, through his tenure as owner and operator of the
Corporation and other dealerships has developed a valuable expertise in all
phases of new automobile sales, service and financing, particularly in the Bay
County area. An agreement not to compete (a non-competition agreement) shall be
executed by the Shareholder providing that Shareholder shall not compete with
the Corporation in all automotive related businesses within a radius of one
hundred (100) miles of Bay County, Florida, for a period of five (5) years from
the date of Closing. A Consulting Agreement shall provide for Shareholder to be
a participant in Corporation's health plan and provide consulting services as
defined therein including attending Department Head meetings for the Corporation
when in the Bay County area. The consulting and non-competition agreement shall
be in the form acceptable to Shareholder and Buyer to be attached hereto as
EXHIBIT "I."
17. TAX ELECTIONS. (a) The parties agree that upon completion of this
transaction Corporation may file an election under Section 338 (h) (10) of the
Internal Revenue Code to treat the sale hereunder as if the Corporation had sold
all of its assets. Buyer agrees to be responsible for payment of any incremental
taxes associated with any such Section 338 election.
18
(b) The parties agree to allocate the taxable income or loss of the
Corporation as if the Corporation's taxable year consisted of two (2) taxable
years, the first of which ends on the date of the Closing, and the parties will
file the appropriate election provided for under Section 1377 of the Internal
Revenue Code.
18. NATURE AND SURVIVAL OF REPRESENTATIONS. All statements contained in
any certificate or other instrument delivered by or on behalf of the Corporation
and\or Shareholder pursuant hereto, or in connection with the transactions
contemplated hereby, shall be deemed representations and warranties by the
Corporation and/or Shareholder hereunder. All representations, warranties,
indemnitees, covenants, and agreements made by the Corporation and Shareholder
in this Agreement, or pursuant hereto, shall be deemed joint and several, except
as otherwise expressly stated, and shall survive the Closing and any
investigation conducted in connection with this Agreement for a period of five
(5) years.
19. POST OFFICE BOX, TELEPHONE NUMBER AND PERSONAL ITEMS. The
Corporation's post office box number, P. O. Box ______, and telephone number
000-000-0000, shall remain the property of the Corporation. The Buyer agrees to
turn over to Shareholder all mail of a purely personal nature to Shareholder on
a daily basis or as otherwise requested by Shareholder. Shareholder shall be
entitled to retain Shareholder's personal office items and awards.
20. CLAIMS. Following the Closing, Shareholder shall have no claims
against or be due any sums from Corporation except as otherwise provided
pursuant to the terms of this Agreement and any related agreements. Nothing set
forth in this Agreement shall prohibit or restrain the Shareholder or
Corporation from engaging in financial activities or transaction between them
prior to the Closing Date, including, without limitation, repayment of debt due
to the Shareholder, payment of salary, bonus, and other compensation due to
Shareholder, payment of rent, and payment of dividends of current or accumulated
income of the Corporation.
21. BENEFIT. This Agreement shall be binding upon, and inure to the
benefit of, the respective legal representatives of the Shareholder, and the
successors and assigns of the Buyer. Without limiting the foregoing, the
Shareholder's rights hereunder may be enforced by it in its own name. In the
event that the Buyer causes the assets and business of the Corporation to be
transferred to some other corporation, the rights of the Buyer hereunder may be
enforced by such other corporation in its own name. Without the written consent
of the Shareholder, no such assignment may be made by the Corporation prior to
the payment in full of the promissory note.
22. ENFORCEMENT. This Contract may be enforced by a specific
performance action by the Buyer if the Shareholder, without just cause, refuses
to close this Agreement in addition to any other remedy Buyer may have at law or
in equity.
23. CONSTRUCTION. This Agreement shall be governed by the laws of the
State of Florida.
24. NOTICES. All notes, requests, demands, and other communications
hereunder shall be in writing, and shall be deemed to have been duly given if
delivered or mailed, first class postage prepaid, or delivered by overnight
courier, if to Corporation or Shareholder, at
19
___________________________ with a copy to Xxxxxxx X. Xxxxxx, Esq., Bodzin and
Xxxxx, P.C., Xxxxx 000, 0000 - 00xx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, or at
such other address as either of them may have furnished to the Buyer in writing,
or, if to the Buyer, 000 X. Xxxx Xxxxxxx Xx., #000, Xxxxxxx, Xxxxxxx 00000, with
a copy to: J. Xxxxxxx Xxxxxxxxx, Esq., Xxxxxx & Xxxxx, L.L.P., 00 Xxxxx Xxxxxx
Xxx., Xxxxx 0000, Xxxxxxx, XX 00000-0000 or at such other addresses as Buyer may
have furnished to Corporation in writing.
25. EXPENSES. Each of the parties shall bear all expenses incurred by
it in connection with this Agreement and in the consummation of the transactions
contemplated hereby and in preparation thereof.
26. ATTORNEYS' FEES. In the event it becomes necessary for either party
to enforce the terms of this Agreement, the prevailing party shall be entitled,
in addition to such damages or other relief as may be granted, to recover
reasonable attorneys' fees and costs, such attorneys' fees to include those
incurred on any appeal.
27. COOPERATION. Shareholder is an authorized Ford "Dealer" and agrees
to cooperate in assisting Buyer to obtain approval of Buyer as a Ford
Dealer-Operator. Corporation agrees to retain at the Closing all of its rights
and interest in any Ford parts returns privileges.
28. DEMONSTRATORS. Shareholder shall be entitled to two (2)
demonstrators for his use for five (5) years from the date of Closing as further
set forth in the Consulting Agreement. The vehicles shall be provided as set
forth in the Consulting Agreement.
29. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
among the parties hereto and supersedes and cancels any prior agreements,
representations, warranties, or communications, whether oral or written, among
the parties hereto relating to the transactions contemplated hereby or the
subject matter herein. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an agreement in
writing signed by the party against whom or which the enforcement of such
change, waiver, discharge or termination is sought. The parties acknowledge that
they have entered into a letter of intent dated April 30, 1997, which outlines
the terms of this Agreement. The letter of intent requires the parties to act in
good faith and to take certain actions with specified periods of time. The
parties agree that nothing herein contained shall modify or alter the time
periods or other provisions of the letter of intent not otherwise provided for
herein.
Executed the day and year first above written.
Signed in the presence of: CORPORATION:
---------------------------------- XXXX-XXXXXXXXX FORD, INC.
Print Name:
------------------------
By:
---------------------------------- ----------------------
20
Print Name: Name:
---------------------- --------------------
Title:
--------------------
SHAREHOLDER:
--------------------------------
Print Name:
--------------------- -------------------------
XXXXXXX XXXXXXXXX
--------------------------------
Print Name:
--------------------- BUYER:
XXXXXX ACQUISITIONS, INC.
--------------------------------
Print Name:
----------------------
By:
-------------------------------- ----------------------
Print Name: XXXXXX X. XXXXXX,
---------------------- President
21
EXHIBIT "A"
Promissory Note
22
EXHIBIT "B"
Escrow Deposit Agreement
23
EXHIBIT "C"
Financial Statements of the Corporation
24
EXHIBIT "D"
Material Change in Corporation's Financial Condition
25
EXHIBIT "E"
Notice of Hazardous, Toxic or Polluting Substances
26
EXHIBIT "F"
List of Contracts
27
EXHIBIT "G"
Litigation
28
EXHIBIT "H"
Profit Sharing and Benefit Plans
29
EXHIBIT "I"
Non-Competition Agreement and Consulting Contract
30
SCHEDULE "1"
Parts, Accessories and Miscellaneous Supplies
31
SCHEDULE "2"
New and Demonstrator Inventory
32
SCHEDULE "3"
Used Vehicles Inventory
33
