EXHIBIT 10(P)
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT, dated as of August 23, 1996, by Premier Parks
Acquisition Corp., a New York corporation ("Purchaser") and a wholly-owned
subsidiary of Premier Parks, Inc. ("Premier"), Premier, Storytown USA, Inc., a
New York corporation ("Storytown") and Fantasy Rides Corporation, a New York
corporation ("Fantasy", and together with Storytown, the "Sellers") and Xxxxxxx
X. Xxxx, individually ("Wood").
W I T N E S S E T H :
WHEREAS, the Sellers own and operate the real estate, inventory, rides and
other equipment which comprise The Great Escape, an attractions park located at
Xxxxx 0, Xxxx Xxxxxx, Xxx Xxxx (such business being hereinafter referred to as
"Great Escape"); and
WHEREAS, Purchaser desires to buy and Seller desires to sell substantially
all of the assets and business of Great Escape as a going concern, all upon the
terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
of the parties hereto, it is hereby agreed as follows:
DEFINITIONS
The following terms shall have the following meanings when used herein:
1. ASSUMED LEASES shall mean the liabilities and obligations of the Great
Escape business accruing after the Closing Date on all leases of all equipment,
machinery, furniture or other items used in the business of the Great Escape
business.
2. BALANCE SHEETS shall mean unaudited, review quality balance sheets
with respect to the operations of the Great Escape for the fiscal year ended
October 31, 1995 and internally generated, unaudited balance sheets with respect
to the operations of the Great Escape for each month of 1996, through and
including the most recent calendar month ending prior to the Closing Date.
3. CLOSING DATE shall mean December 1, 1996.
4. CODE shall mean the Internal Revenue Code of 1986, as amended.
5. CONSULTING AGREEMENT shall mean that certain consulting agreement
between Premier and Wood whereby Wood will act as consultant to Purchaser in
consideration for payment of One Million Two Hundred Fifty Thousand Dollars
($1,250,000.00) to be paid over the term of five years. The Consulting
Agreement shall substantially conform to the form of agreement contained at
Schedule "C" hereto.
6. DEPOSIT shall mean the deposit paid by Purchaser upon the execution
hereof in the amount of Three Million Dollars ($3,000,000).
7. DOUBLE "H" shall mean Double "H" Hole in the Xxxxx Ranch, Inc.
8. ENCUMBRANCES shall mean all security interests, liens, pledges,
claims, charges, escrows, encumbrances, options, rights of first refusal,
mortgages, indentures, easements, restrictions, licenses, security agreements or
other agreements, arrangements, contracts, commitments, understandings or
obligations placed on the Purchased Assets.
9. ENVIRONMENTAL REPORT means the report prepared by Sellers'
environmental consultant concerning its assessment of the Real Property.
10. EXCLUDED ASSETS means those assets not part of the Purchased Assets,
as set forth in Section 1.02 hereof.
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11. EXPENSES shall mean all operating expenses and capital expenditures
made in the ordinary course of business and not exceeding Ten Thousand Dollars
($10,000) per expenditure.
12. FINANCIALS shall mean the Balance Sheets and the Income Statements.
13. XXXX-XXXXX-XXXXXX ACT shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended.
14. INCOME STATEMENTS shall mean the unaudited, review quality statement
of earnings with respect to the operations of the Great Escape for each of the
years ended October 31, 1993, October 31, 1994 and October 31, 1995 and
internally generated, unaudited income statements for each month of 1996,
through and including the most recent month ending prior to the Closing Date.
15. MARKS shall mean all of the goodwill, trademarks and service marks
(whether at common law or registered under state or federal law or under the law
of any foreign jurisdiction), logos, trade names and all other names or slogans
used by Sellers in connection with the business of the Great Escape.
16. PBGC shall mean Pension Benefit Guaranty Corporation.
17. PURCHASED ASSETS shall be as defined in Section 1.02 hereof.
18. PURCHASER'S OPERATING EXPENSES shall be as defined in Section 1.09.
19. REAL ESTATE shall mean approximately 334.41 acres of land, together
with improvements and fixtures thereon located at Xxxxx 0, Xxxx Xxxxxx, Xxx
Xxxx, as more particularly described on Schedule 1.02(A) hereto.
ARTICLE I
SALE OF ASSETS; PRICE AND TERMS;
CLOSING TRANSACTIONS
SECTION 1.01. CLOSING DATE; TERM. The consummation of the transactions
contemplated by this Agreement shall take place at the offices of Xxxxxx & Xxxx,
P.C., 00 Xxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxx, Xxx Xxxx at 9:00 a.m. on the Closing
Date. TIME IS OF THE ESSENCE AS TO THE CLOSING DATE. Therefore, in no event
shall the Closing Date be later than December 10, 1996.
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SECTION 1.02. SALE AND PURCHASE. On the Closing Date, in reliance upon the
representations, warranties and agreements of the parties, Sellers shall sell,
assign, transfer, convey and deliver to Purchaser, and Purchaser shall buy from
Sellers, free and clear of all Encumbrances (except as permitted under this
Agreement), the Purchased Assets, comprising the following assets and
properties, all upon the price and payment terms set forth in this Agreement:
(A) REAL ESTATE. The Real Estate.
(B) INVENTORY. Inventory used in connection with the operation of the
Great Escape business, consisting mainly of merchandise, plush, food, liquor,
office supplies, maintenance supplies, packaging materials, and other items, as
listed on Schedule 1.02(B) attached hereto.
(C) PRE-PAID DEPOSITS. At the Closing Date, Sellers shall assign to
Purchaser, all unfilled "pre-paid" deposits for the Great Escape's 1996 and 1997
seasons held by Sellers as of the Closing Date and Purchaser assumes such
deposits and the responsibility to the customer for honoring such deposits.
Schedule 1.02(C) contains a complete list of all such deposits.
(D) PREPAID ITEMS. Sellers agree to transfer to Purchaser any license or
privilege that may be transferred, including service contracts in connection
with the Purchased Assets. To the extent permissible and requested by
Purchaser, Sellers agree to allow Purchaser to operate Great Escape under
Sellers' permits and licenses until such time as such permits or licenses are
issued to Purchaser. The parties agree to execute such agreements and documents
as are necessary to effectuate the provisions of this subsection (D).
(E) MACHINERY, EQUIPMENT, FURNITURE AND FIXTURES. All owned signs of
every description located on the Real Estate described in Section 1.02(A)
hereof, and all rides and spare parts, office furniture, other furniture,
fixtures, equipment, machinery, tools, including all items that may have been
considered as supplies rather than capital expenditures by Sellers at the time
acquired, and all other tangible assets of any nature, all used in the Great
Escape business, except to the extent disposed of in the ordinary course of
business. The assets purchased under this Section 1.02(E) shall include the
assets listed on Schedule 1.02(E) attached hereto.
(F) SUPPLIES AND MISCELLANEOUS. All supplies and other miscellaneous
assets used in the Great Escape business or included in the Balance Sheets.
(G) TRADEMARKS. Storytown and Wood individually, as the owner of the
Comet trademark, will convey all of the Marks, as they are set forth on Schedule
1.02(G).
(H) ASSUMED LEASES. Sellers will transfer all of its rights in and to the
Assumed Leases and any other contract or agreement assumed by the Purchaser at
the Closing.
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(I) BOOKS AND RECORDS. All books and records pertaining to the assets,
properties and business of the Great Escape business.
(J) SOFTWARE AND RELATED ITEMS. All software programs, computer
printouts, data bases and related items used in the operation of the business of
the Great Escape.
(K) MISCELLANEOUS. All other assets used in the business of the Great
Escape and owned by Sellers.
Except that, the foregoing Purchased Assets, as described in this Section 1.02
in subsections (A) through (K) shall not include the Excluded Assets, which are
as follows:
(i) all rights of the Sellers under this Agreement, including the
consideration paid pursuant to Section 1.04;
(ii) the Sellers' accounting records;
(iii) rights to claim tax refunds;
(iv) All of Sellers' cash and cash equivalents (except Pre-Paid
Deposits referred to in Section 1.02(C));
(v) Sellers' accounts receivable; and
(vi) Those assets set forth as "Excluded Assets" on Schedule 1.02
attached hereto.
SECTION 1.03. INSTRUMENTS OF TRANSFER. The sale, assignment, transfer,
conveyance and delivery of the Purchased Assets shall be made by such bills of
sale and other recordable instruments of assignment, transfer and conveyance as
Purchaser shall reasonably request. The Real Estate will be conveyed by good
and sufficient deed, containing a warranty against grantor's acts for conveying
Purchaser the fee simple of the Real Estate and containing all customary
covenants utilized in connection with transfers of property in New York.
SECTION 1.04 CONSIDERATION. The purchase price for the Purchased Assets is
Thirty-Three Million Dollars ($33,000,000) payable in the following manner:
(A) Upon execution of this Agreement, Purchaser shall pay to Xxxxxx &
Xxxx, P.C., the Deposit which shall be applied to the Purchase Price at
Closing. One Million Dollars of the Deposit shall be held in escrow by Xxxxxx
& Xxxx, P.C. in accordance with the terms of the escrow agreement attached
hereto as Schedule "A". The remaining Two Million Dollars of the
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Deposit shall be paid to Sellers upon the execution of this Agreement and shall
not be held in escrow.
(x) In the event that any of the conditions to obligations of the
Purchaser, as contained in Section 4.01 hereto, is not satisfied by the Closing
Date, the Purchaser shall , at its option, either
(i) not waive the failure and be paid the Deposit, plus interest, in
full compensation of the Purchaser's damages (Wood, by execution of this
Agreement, hereby guarantees the Sellers' obligation to refund the Deposit in
the event the transaction is not consummated for this reason); or
(ii) waive the failure to satisfy the condition to obligation of the
Purchaser and insist upon specific performance of the Agreement.
(y) In the event that the transaction contemplated herein does not close
due to any of the conditions to obligations of the Sellers, as contained in
Section 4.02(A), (B) or (D) hereof, not being satisfied by the Closing Date, and
such failure is not waived by the Sellers, the Sellers shall retain the Deposit
as liquidated damages.
(z) Sellers and Wood acknowledge and agree that, if the Sellers fail to
proceed with the closing of the transactions contemplated hereby in any
circumstance other than those described in clauses (x)(i) and (y) above, the
Purchaser will not have adequate remedies at law with respect to such breach and
that, in such event, Purchaser shall be entitled, without the necessity or
obligation of posting a bond, to commence a suit in equity to obtain specific
performance of Sellers' obligations under the Agreement. Wood and Sellers
specifically affirm the appropriateness of such injunctive or other equitable
relief in any such action.
(B) At the Closing Date, Purchaser shall pay to the Sellers by wire
transfer, the balance of the purchase price, equaling Thirty Million Dollars
($30,000,000).
(C) As further consideration for the transfer of the Purchased Assets to
Purchaser:
(i) Premier shall make a charitable contribution of Two Hundred
Thousand Dollars ($200,000) worth of Premier capital stock to Double "H";
(ii) Purchaser shall host the Double "H" Gala at the Great Escape (a)
on a date and at a time (no earlier than 7:00 PM and no later than 1:00 am)
selected prior to March 1 by Double "H" each year during the seasonal operation
of the Great Escape for a term of ten (10) years, beginning in the summer of
1997, (b) in connection with hosting the Gala, provide the attendees at such
Gala with access to that portion of the Great Escape, and any new amusement
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installed by the Purchasers at the Great Escape, as has historically been made
available to the attendees at such Gala (including, games, facilities,
amusements and support personnel), and (c) as Purchaser's and Premier's
additional corporate contribution to Double "H", fully host the Gala as outlined
herein without cost to Double "H", except as to those costs contained on
Schedule 1.04(C) hereto;
(iii) Premier shall enter into the Consulting Agreement; and
(iv) Purchaser shall reimburse the Sellers for all Purchaser's
Operating Expenses.
(D) The parties have agreed, after arm's length negotiations, to allocate
the Purchase Price plus the Assumed Leases among the Purchased Assets as set
forth in Schedule 1.04(D).
SECTION 1.05. NO ASSUMPTION. Except as specified on Schedule 1.05 hereto with
respect to the Assumed Leases, Purchaser does not assume any obligation or
liability of the Sellers, whether now or hereafter existing and whether or not
arising in connection with the ownership or operation of the Great Escape, agree
in any way or manner to honor any claim against the Sellers whether or not
arising out of or in connection with the ownership or operation of the Great
Escape or assume any obligation or liability arising out of or in connection
with the sale of the Purchased Assets pursuant to the terms hereof.
SECTION 1.06. CLOSING TRANSACTIONS.
(A) Sellers shall deliver the following documents to Purchaser at least
ten (10) days following the execution hereof:
(i) an Abstract of Title certified to current date or prior
title insurance policy;
(ii) current 10 year Town and County Tax Search;
(iii) corporate franchise tax search with respect to each Seller;
and
(iv) the Environmental Report.
(B) On the Closing Date, the Sellers shall deliver to Purchaser:
(i) the bills of sale and other instruments of assignment, transfer
and conveyance provided for in Section 1.03 above, in form and substance
reasonably satisfactory to Purchaser;
(ii) such keys, lock and safe combinations and other similar items as
Purchaser shall require to obtain full occupation and control of the Great
Escape assets and properties; and
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(iii) appropriate evidence of all necessary corporate action by
Sellers in connection with the transactions contemplated hereby, including
without limitation certified copies of resolutions duly adopted by Sellers'
directors approving the transactions contemplated by, and authorizing the
execution, delivery and performance by Sellers of, this Agreement, and a
certificate as to the incumbency of officers of Sellers executing any instrument
or other document delivered in connection with such transactions.
(C) On the Closing Date, Purchaser shall deliver to Sellers:
(i) the cash and other consideration set forth in Section 1.04; and
(ii) appropriate evidence of all necessary corporate action by
Purchaser in connection with the transactions contemplated hereby, including
without limitation certified copies of resolutions duly adopted by Purchaser's
directors approving the transactions contemplated by, and authorizing the
execution, delivery and performance by Purchaser of, this Agreement, and a
certificate as to the incumbency of officers of Purchaser executing any
instrument or other document delivered in connection with such transactions.
SECTION 1.07. NAME CHANGE. On or promptly following the Closing Date, Sellers
will cause to be prepared, executed and filed with the appropriate governmental
authorities Certificates of Discontinuance of use of an assumed name and such
other documents as are necessary to discontinue their right to do business under
the names "The Great Escape" and "Splashwater Kingdom" and Sellers will not
thereafter use or operate any business under such name or a name that would be
confusingly similar to "The Great Escape" or "Splashwater Kingdom". Sellers
will retain all rights to the name "Storytown", "Storytown USA" and "Fantasy
Rides Corporation" and Purchaser agrees not to use or operate a business under
such names or names that would be confusingly similar thereto.
SECTION 1.08. ACCESS TO RECORDS AND PROPERTIES OF THE GREAT ESCAPE. From and
after the date hereof until the Closing Date, Sellers shall afford to the
officers, independent public accountants, counsel, environmental engineers,
surveyors, building inspectors, lenders and other representatives of Purchaser,
access at reasonable times and upon notice to Xxxxxxx X. Xxxx, c/o Xxxxxxx X.
Xxxx Foundation, 000 Xxxx Xxxxxx, Xxxxx Xxxxx, Xxx Xxxx, to the assets,
properties, real estate, books and records (including tax returns filed and
those in preparation) of Sellers in order that Purchaser may have full
opportunity to make investigations of the assets and affairs of the Sellers.
The Purchaser shall have the right to make copies of records and interview
employees of Sellers during such time.
SECTION 1.09. OPERATION OF BUSINESS OF THE GREAT ESCAPE. (A) From the date
hereof to the Closing Date, Sellers shall:
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(i) consult with Purchaser on a regular basis with respect to all
decisions which might affect the business or assets of the Great Escape; and
(ii) except as Purchaser may otherwise agree, operate its business as
currently operated and only in the ordinary course and, consistent with such
operation, use its best efforts to preserve intact its current business
organization and its relationships with its employees and persons having
dealings with it.
(B) From the date of this Agreement up to and including October 31, 1996,
all Expenses of the Great Escape, except Expenses (i) incurred for items to be
delivered or services to be rendered after October 31, 1996 and (ii) incurred
for replacement parts to amusements/rides included in the definition of
Purchased Assets hereunder which are delivered after October 31, 1996, shall be
the responsibility of the Sellers. From and including November 1, 1996 through
the Closing Date, the Sellers shall operate the Great Escape for the account of
Purchaser and all Expenses (i) incurred in connection with the operation of the
Great Escape during such period, (ii) incurred for items to be delivered or
services to be rendered after October 31, 1996 and (iii) incurred for
replacement parts to amusements/rides included in the definition of Purchased
Assets hereunder which are delivered after October 31, 1996, shall be the
responsibility of the Purchasers and shall constitute "Purchaser's Operating
Expenses" hereunder. During the time that the Great Escape is operated by the
Sellers for the Purchaser's account, the Sellers agree not to incur any capital
expenses which are not in the ordinary course of business in excess of Two
Thousand Five Hundred Dollars ($2,500) without the prior consent of the
Purchaser.
ARTICLE II
TAXES
SECTION 2.01. SALES AND TRANSFER TAXES. Sellers shall be responsible for all
New York real estate transfer taxes payable in respect to the transfer of Real
Estate contemplated hereunder. Purchaser shall be responsible for all New York
sales tax payable in respect of the transfer of personal property contemplated
hereunder.
SECTION 2.02. UTILITIES AND MISCELLANEOUS TAXES. The following items shall be
pro-rated to the Closing Date: (a) all water, sewer, gas, electric, fuel and
other utility charges and (b) except as provided herein, all other annual or
periodic taxes, assessments (to the extent applicable to periods from and
following the Closing Date), fees or similar charges (other than taxes or other
charges on, or measured by, the income of either Seller) imposed by any
governmental authority upon or with respect to the Purchased Assets to the
extent such taxes, assessments, fees or similar charges relate to permits,
licenses or other governmental authorization which are transferable to Purchaser
or relate to the Purchased Assets.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. REPRESENTATIONS AND WARRANTIES OF SELLERS. Sellers jointly and
severally represent and warrant to Purchaser as follows:
(A) ORGANIZATION, STANDING AND POWER. Each Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New York. Each Seller has all requisite corporate power and authority to own,
lease and operate its properties, to carry on its business as now being
conducted and to execute, deliver and perform this agreement and all writings
relating hereto.
(B) AUTHORIZATION OF SELLERS. This Agreement and all writings relating
hereto to be signed by Sellers have been duly authorized, executed and delivered
and constitute valid and binding obligations of Sellers enforceable in
accordance with their respective terms. No further corporate action is needed
in order to authorize the transactions contemplated herein. Neither the
execution and delivery of this Agreement or any writing relating hereto nor the
consummation by either Seller of the transactions contemplated hereby or
thereby, nor compliance with any of the provisions hereof or thereof will:
(i) violate the certificate of incorporation and any amendments
thereto or the bylaws of either Seller or any statute, law, rule or regulation
or any order, writ, injunction or decree of any court or governmental authority;
or
(ii) violate or conflict with or constitute a default under (or give
rise to any right of termination, cancellation or acceleration under) any
material agreement or writing to which either Seller is a party or by which it
or its assets or properties may be bound. No consent or approval of or
notification to any governmental authority, except for necessary filings
pursuant to the Xxxx-Xxxxx-Xxxxxx Act, is required in connection with the
execution and delivery by Sellers of this Agreement or any writing relating
hereto or the consummation of the transactions contemplated hereby or thereby.
(C) FINANCIAL STATEMENTS. (i) Sellers have or will present Purchaser
with the Financials, which have been prepared in accordance with GAAP applied on
a consistent basis throughout the periods covered thereby, except as noted
thereon and except for the internally generated Income Statements and Balance
Sheets. The Financials fairly present the financial position of the Great
Escape business and the results of its operations as at the dates thereof and
for the periods covered thereby.
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(ii) Schedule 3.01(C) contains a true and correct list of attendance
by month at the Great Escape for the 1994, 1995 and 1996 seasons.
(D) LIABILITIES. At the date of the Balance Sheets Sellers did not have
and at the Closing Date Sellers will not have liabilities or obligations of any
nature, known or unknown, fixed or contingent, matured or unmatured which were
not reflected on the Balance Sheets, or, in the case of contingent liabilities,
discussed specifically in any notes thereto or disclosed specifically on
Schedule 3.01(D) to this Agreement.
(E) ENVIRONMENTAL. The Environmental Report contains an accurate
statement of the environmental condition of the Real Property as of the date
thereof. Sellers agree to indemnify Purchaser for any environmental condition
not contained in the Environmental Report which is caused by the use or
occupancy of Sellers at the Great Escape. Without limiting the generality of
the foregoing or the plain meaning of this provision, Sellers shall be under no
obligations to provide any remuneration or indemnification to the Purchaser or
Premier in connection with (i) the environmental condition of the Real Property
as disclosed in the Environmental Report or (ii) any occurrence on or affecting
the Real Property following the Closing Date. The environmental issues raised
in the Environmental Report have been remedied. During the time that Sellers
have owned the Purchased Assets, Sellers have been in full compliance with all
environmental laws applicable to the Great Escape, including, but not limited
to, laws governing the disposal and release of hazardous substances. The
Sellers have not received any notice from any governmental authority alleging
any violation of environmental laws.
(F) ABSENCE OF CHANGES. Except as otherwise listed on Schedule 3.01(F)
hereto, since the date of the July 31, 1996 Balance Sheet the business of The
Great Escape has been operated only in the ordinary course and there has not
been and through the Closing Date there will not be:
(i) any material adverse change in its condition, financial or
otherwise, or its assets, liabilities, earnings, book value, business or
prospects, or to the knowledge of Sellers any event which could reasonably be
expected to result in such change;
(ii) any material damage, destruction or loss, whether or not covered
by insurance, adversely affecting its business or assets;
(iii) the incurrence of any material obligation or liability
(whether absolute, accrued, contingent or otherwise and whether due or to become
due) other than obligations or liabilities incurred in the ordinary course of
business and consistent with past practices;
(iv) the adoption of any statute, rule, regulation or order which
adversely affects the business or assets of the Great Escape;
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(v) any sale, transfer or other disposition of any assets of the
Great Escape to any party including Sellers except for payments of third party
obligations incurred in the ordinary course of business in accordance with the
Great Escape's regular payment practices (including debt service payments), or
other dispositions in the ordinary course of business;
(vi) any termination or waiver of any rights of value to the
Great Escape business not in the ordinary course of its business;
(vii) any expenditures or commitment in excess of Ten Thousand
Dollars ($10,000) for additions to or replacements of property, plant or
equipment of the Great Escape, except as provided in Section 1.09(B) hereto;
(viii) any forward purchase commitments involving more than Ten
Thousand Dollars ($10,000) in the aggregate, except as provided in Section
1.09(B) hereto;
(ix) any change in the accounting methods or practices followed
by the Great Escape Business;
(x) to the knowledge of Sellers, the commencement of any
proceeding seeking the taking of Real Estate used by the Great Escape; or
(xi) any change in the compensation of or benefit plans for
employees of the Great Escape except in the ordinary course of business.
(G) TAX MATTERS.
(i) All federal, state, local and foreign tax returns and tax
reports, including withholding reports, if any, required to be filed with
respect to the business and assets of the Great Escape have been filed with the
appropriate governmental agencies in all jurisdictions in which such returns and
reports are required to be filed, all of the foregoing are true, correct and
complete, and all amounts shown as owing thereon have been paid;
(ii) All federal, state, local and foreign income, profits,
franchise, sales, use, occupation, property, excise and other taxes (including
interest and penalties), if any, payable by the Great Escape or relating to or
chargeable against its assets, revenues or income through the date of this
Agreement were fully paid by such date and all similar items due through the
Closing Date will have been fully paid by that date.
(H) TITLE TO PROPERTY AND RELATED MATTERS. Sellers will at the Closing
have good and marketable title to all of the Purchased Assets, free and clear of
all Encumbrances except:
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(i) liens for current taxes not yet due and payable or which are
being contested in good faith by appropriate proceedings or
(ii) Encumbrances referred to in this Agreement or in any
Schedule or Exhibit to this Agreement.
(I) REAL PROPERTY OWNED OR LEASED. Schedule 3.01(I) contains a list and
description of all Real Estate relating to or used in the operation of the Great
Escape owned by Sellers or leased by Sellers as tenant or landlord, and the
improvements (including buildings and other structures) located on the Real
Estate, other than that listed on Schedule 1.02(A) hereto. To Sellers'
knowledge, no third party has the right to occupy any portion of the Real Estate
through easement, lease, etc., except for easements of record.
(J) PERSONAL PROPERTY OWNED OR LEASED. The tangible personal property
included in the Purchased Assets material to the operation of the Great Escape
business is in the aggregate in reasonably good condition and working order.
Except as set forth in Schedule 3.01(J), with respect to all tangible personal
property subject to an Assumed Lease:
(i) all of the Assumed Leases are in full force and effect and
constitute legal, valid and binding obligations of the respective parties
thereto;
(ii) there have not been and there currently are not any material
defaults thereunder by any party; and
(iii) no event has occurred which (whether with or without notice,
lapse of time or the happening or occurrence of any other event) would
constitute a material default thereunder. Except as set forth in Schedule
3.01(J), the validity, continuation and effectiveness of all such leases and
agreements under the current rentals and other current material terms thereof
will in no way be affected by the transfer of such leases and agreements to
Purchaser under this Agreement or, if any would be affected, Sellers shall use
their reasonable best efforts to cause a consent to such transfer to be
delivered to Purchaser prior to the Closing Date.
(K) LICENSES; TRADEMARKS; TRADE NAMES; ETC. Schedule 3.01(K) contains a
list of:
(i) all nongovernmental licenses held by Sellers relating to the
Great Escape business (including, as to each such license, the name of the
licensee and licensor, a description of the subject matter of the license, the
termination date or notice requirement with respect to termination, basis of
royalties calculation and renewal options); and
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(ii) all trademarks, trade names, service marks, copyrights,
know-how, patents and applications for any of the foregoing owned by or
registered in the name of either Seller or Wood, relating to or used in
connection with the business of the Great Escape business. Sellers and Wood own
all the trademarks, trade names, service marks, copyrights, know-how, patents
and applications for patents listed on Schedule 3.01(K) and, except as set forth
thereon, pay no royalty under any of them and have the exclusive right to bring
actions for the infringement thereof. Except as listed on Schedule 3.01(K),
there is no pending or, to the best of the knowledge of either Seller,
threatened claim or litigation against either Seller contesting its right to use
any of the trademarks, trade names and know-how or the validity of any of the
licenses, copyrights and patents listed on such Schedule or asserting the misuse
thereof.
(L) INSURANCE. Sellers maintain in effect insurance covering the Great
Escape's assets and business and any liabilities relating thereto in an amount
believed adequate by Sellers, and such insurance coverage shall be maintained by
Sellers through the Closing Date.
(M) AGREEMENTS ETC. Schedule 3.01(M) contains a list and brief
description of all material written contracts, agreements and other instruments
relating to the Great Escape business and not listed on another Schedule
hereto. Sellers are not in default of any agreements listed on Schedule
3.01(M).
(N) LITIGATION ETC. Except as set forth on Schedule 3.01(N), there are no
actions, suits, claims, investigations or legal or administrative or arbitration
proceedings pending or, to the best knowledge of either Seller, threatened
against either Seller relating to the Great Escape business, its assets,
business or products, whether at law or in equity, or before or by any federal,
state, municipal or other governmental instrumentality.
(O) COMPLIANCE; GOVERNMENTAL AUTHORIZATIONS.
(i) Except as set forth on Schedule 3.01(O), to the best of its
knowledge, each Seller is materially in compliance with all federal, state,
local or foreign laws, ordinances, regulations and orders applicable to the
business or properties of the Great Escape, where failure to do so would have a
materially adverse impact on the business of the Great Escape or the Purchased
Assets. Each Seller has all federal, state, local and foreign governmental
licenses and permits materially necessary in the conduct of the Great Escape's
business and such licenses and permits are in full force and effect, and, to the
best of its knowledge, each Seller is in material compliance with the terms
thereof and no proceeding is pending or threatened to revoke or limit any
thereof. Schedule 3.01(O) contains a list of:
(a) all such material governmental licenses and permits (none of
which are transferable unless otherwise indicated by an asterisk) and
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(b) all consents, orders, decrees and other compliance
agreements relating to the Great Escape business under which either Seller is
operating or bound, copies of all of which have been furnished to Purchaser.
(ii) Sellers have furnished to Purchaser (who has initialed the same
for identification) copies of all reports of inspections of the Great Escape's
business and properties from January 1, 1995 through the date hereof under OSHA
and under all other applicable federal, state and local health and safety laws
and regulations.
(P) EMPLOYEES. Sellers will pay in full all wages, salaries, bonuses,
severance or vacation pay and other direct and indirect compensation earned by
all employees of the Great Escape through the fiscal year ended October 31, 1996
and will pay the 1996 Christmas bonuses. With respect to the Great Escape, each
Seller is materially in compliance with all federal, state and local laws and
regulations respecting employment and employment practices, terms and conditions
of employment and wages and hours. No representation question exists respecting
the employees of the Great Escape and no collective bargaining agreement is
currently being negotiated by either Seller relating to the Great Escape. No
employees of the Great Escape are represented by a union or are subject to a
collective bargaining agreement. No employment contracts exist with employees
of the Great Escape.
(Q) COMPENSATION. Schedule 3.01(Q) contains a list of all current
officers and non-seasonal employees of the Great Escape, together with the
current job title and aggregate remuneration rate (bonus and salary) for each
such person.
(R) EMPLOYEE BENEFIT PLANS. (i) Schedule 3.01(R) lists each employee
benefit plan that each Seller maintains or to which each Seller contributes.
(a) To the knowledge of Sellers, each such employee benefit plan
(and each related trust, insurance contract or fund) complies, and since
inception has complied, in form and in operation in all respects with the
applicable requirements of ERISA and the Code, except where the failure to
comply would not have a material adverse effect on the financial condition of
each individual Seller.
(b) All contributions (including, but not limited to, all
employer contributions and employee salary reduction contributions) which are
due have been paid on a timely basis to each such employee benefit plan.
(c) Each such employee benefit plan which is an employee pension
benefit plan has received a determination letter from the Internal Revenue
Service to the effect that it meets the requirements of Code Sec. 401(a).
15
(d) The market value of assets under each such employee benefit
plan which is an employee pension benefit plan equals or exceeds the present
value of accrued benefits thereunder.
(e) No plans are multiemployer plans.
(ii) With respect to each employee benefit plan that either Seller
maintains or ever has maintained or to which it contributes, has ever
contributed or has ever been required to contribute:
(a) No such employee benefit plan which is an employee pension
benefit plan has been completely or partially terminated or been the subject of
a reportable event as to which notices would be required to be filed with the
PBGC. No proceeding by the PBGC to terminate any such employee pension benefit
plan has been instituted.
(b) No action, suit, proceeding, hearing or investigation with
respect to the administration or the investment of the assets of any such
employee benefit plan (other than routine claims for benefits) is pending,
except where the action, suit, proceeding, hearing or investigation would not
have a material adverse effect on the financial condition of the Sellers or the
plan.
(c) Sellers have incurred no liability to the PBGC (other than
PBGC premium payments) or otherwise under Title IV of ERISA (including any
withdrawal liability) with respect to any such employee benefit plan which is an
employee pension benefit plan.
(d) For purposes of this Section 3.01(2), the term "Sellers"
shall be deemed to include any entity which is under common control or
affiliated with Sellers within the meaning of section 4001 of ERISA and/or
Section 414 of the Code.
(S) BROKER. Neither Seller has liability or obligation to pay any fee or
commission to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which the Purchaser could become liable or
obligated.
SECTION 3.02. REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser hereby
represents and warrants to Sellers as follows:
(A) ORGANIZATION, STANDING AND POWER. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New York. Purchaser has all requisite corporate power and authority to own,
lease and operate its properties, to carry on its business as being conducted
and to execute, deliver and perform the terms of this Agreement and all writings
relating hereto.
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(B) AUTHORITY. The execution, delivery and performance of the terms of
this Agreement and all writings relating hereto by Purchaser has been duly and
validly authorized by the Board of Directors and, by the shareholders of
Purchaser. This Agreement and all writings relating hereto to be signed by
Purchaser constitutes the valid and binding obligations of Purchaser enforceable
in accordance with their respective terms.
(C) NONCONTRAVENTION. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
(including the assumptions referred to in Section 1 above), will (i) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge, or other restriction of any government, governmental agency, or
court to which the Buyer is subject or any provision of its charter or bylaws or
(ii) conflict with, result in a breach of, constitute a default under, result in
the acceleration of, create in any party the right to accelerate, terminate,
modify, or cancel, or require any notice under any agreement, contract, lease,
license, instrument, or other arrangement to which the Purchaser is a party or
by which it is bound or to which any of its assets is subject. The Purchaser
does not need to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency,
except for filings necessary under the Xxxx-Xxxxx-Xxxxxx Act, in order for the
parties to consummate the transactions contemplated by this Agreement (including
the assumptions referred to in Section 1 above).
SECTION 3.03. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made by any party to this Agreement or pursuant hereto shall
survive the closing of the transactions hereunder for a period of one year from
the Closing Date.
SECTION 3.04. SCHEDULES. On or before September 9, 1996, the Sellers shall
have the right to provide, modify or amend any Schedule attached hereto or
required or contemplated hereby (the "Missing Schedules") and such modification
or amendment shall be effective as of the date of this Agreement. The absence
of any schedule to this Agreement at the time executed or the need to further
amend or modify any schedule to this Agreement after the same is executed, all
as contemplated by this section, shall not affect the validity or enforceability
of this Agreement. The Missing Schedules shall be in substance generally
consistent with the information provided or described to the Purchaser by the
Sellers on or prior to the date hereof. In the event the Missing Schedules are
not in substance generally consistent with the information provided or described
to the Purchaser by the Sellers on or prior to the date hereof, Purchaser shall
have the right, exercisable in writing within five (5) business days after its
receipt of the Missing Schedules, to terminate this Agreement. In such event,
the Sellers and Wood agree to forthwith return, or cause the forthwith return
of, the Deposit to the Purchaser.
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ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.01. CONDITIONS TO OBLIGATIONS OF PURCHASER. The obligations of
Purchaser to perform this Agreement are subject to the satisfaction of the
following conditions on or prior to the Closing Date, unless waived by the
Purchaser, and Sellers shall use their best efforts to cause such conditions to
be fulfilled:
(A) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Sellers in this Agreement or in any schedule, certificate or document delivered
in connection herewith shall be true and correct on the Closing Date as though
made on and as of the Closing Date.
(B) PERFORMANCE OF OBLIGATIONS OF SELLERS. Sellers shall have performed
all agreements and obligations required to be performed by them under this
Agreement prior to the Closing Date.
(C) CONSENTS. Sellers shall have obtained, or to the reasonable
satisfaction of Purchaser obviated the need to obtain, all consents or waivers
from third parties necessary to convey to Purchaser all contracts, agreements
and leases of every nature whatsoever to be conveyed hereunder.
(D) XXXX-XXXXX-XXXXXX. All applicable waiting periods (and any extensions
thereof) under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or otherwise been
terminated.
(E) OTHER AGREEMENTS. Sellers shall have duly executed and delivered to
the Purchaser the Non-Competition Agreement in the form of Exhibit B.
(F) NO LITIGATION. No action, suit or other proceeding shall be pending
before any court, tribunal or governmental authority seeking or threatening to
restrain or prohibit the consummation of the transactions contemplated by this
Agreement, or seeking to obtain substantial damages in respect thereof, or
involving a claim that consummation thereof would result in the violation of any
law, decree or regulation of any governmental authority having appropriate
jurisdiction.
(G) NO MATERIAL CHANGE. There shall have been no material adverse change
in the business, operating results or physical condition of The Great Escape
between the date of this Agreement and the Closing Date.
SECTION 4.02. CONDITIONS TO OBLIGATIONS OF SELLER. The obligations of Sellers
to perform this Agreement are subject to the satisfaction, on or prior to the
Closing Date, of the following
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conditions, unless waived by the Sellers, and Purchaser shall use its best
efforts to cause such conditions to be fulfilled:
(A) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Purchaser in this Agreement or in any schedule, certificate or document
delivered pursuant hereto shall be true and correct on the Closing Date as
though made on and as of the Closing Date.
(B) PERFORMANCE OF OBLIGATIONS OF PURCHASER. The Purchaser shall have
performed all obligations required to be performed by it under this Agreement
prior to the Closing Date, including payment of the Purchase Price.
(C) XXXX-XXXXX-XXXXXX. All applicable waiting periods (and any extensions
thereof) under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or otherwise been
terminated.
(D) OTHER AGREEMENTS. Purchaser shall have duly executed and delivered to
the Seller the Consulting Agreement in the form of Exhibit C.
(E) NO LITIGATION. No action, suit or other proceeding shall be pending
before any court, tribunal or government authority seeking or threatening to
restrain or prohibit the consummation of the transactions contemplated by this
Agreement, or seeking to obtain substantial damages in respect thereof, or
involving a claim that consummation thereof would result in the violation of any
law, decree or regulation of any governmental authority having appropriate
jurisdiction.
ARTICLE V
INDEMNIFICATION
SECTION 5.01. INDEMNIFICATION OF PURCHASER. Sellers shall indemnify and save
Purchaser, and its shareholders, subsidiaries, affiliates, officers and
directors, harmless from, against, for and in respect of:
(A) any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action, encumbrances and reasonable
costs and expenses suffered, sustained, incurred or required to be paid by any
indemnified party because of: (1) the untruth, inaccuracy or breach of any
representation, warranty, agreement or covenant of either Seller contained in or
made in connection with this Agreement; (2) the failure of the parties to comply
with the applicable bulk sales transfer law, or (3) the assertion against
Purchaser or the Purchased Assets of any liability or obligation of either
Seller or its affiliates or relating to either Seller's operations or any of the
Purchased Assets prior to the Closing Date, whether absolute or contingent,
19
matured or unmatured, known or unknown, other than liabilities and obligations
expressly assumed by Purchaser under Section 1.05 hereof; and
(B) all reasonable costs and expenses (including, without limitation,
attorney's fees, interest and penalties) incurred by any indemnified party in
connection with any action, suit, proceeding, demand, assessment or judgment
incident to any of the matters indemnified against in this Section 5.01.
(C) Wood shall indemnify and save Purchaser, and its shareholders,
subsidiaries, affiliates, officers and directors, harmless from, against, for
and in respect of any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action, encumbrances and reasonable
costs and expenses suffered, sustained, incurred or required to be paid by any
indemnified party because of the untruth, inaccuracy or breach of any
representation, warranty, agreement or covenant of either Seller contained in or
made in connection with this Agreement and all reasonable costs and expenses
(including, without limitation, attorney's fees, interest and penalties)
incurred by any indemnified party in connection with any action, suit,
proceeding, demand, assessment or judgment incident thereto.
SECTION 5.02. INDEMNIFICATION OF SELLERS. Purchaser shall indemnify and save
each Seller and each of its shareholders, subsidiaries, affiliates, officers and
directors harmless from, against, for and in respect of:
(A) any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action, encumbrances and reasonable
costs and expenses suffered, sustained, incurred or required to be paid by any
indemnified party because of (1) the untruth, inaccuracy or breach of any
representation, warranty, agreement or covenant of Purchaser contained in or
made pursuant to this Agreement; (2) the assertion against either Seller of any
liability or obligation of Purchaser relating to Purchaser's operation of the
Great Escape from and after the Closing Date; or (3) the assertion against
either Seller of any liability of either Seller assumed by Purchaser under
Section 1.05 hereof; and
(B) all reasonable costs and expenses (including, without limitation,
attorney's fees, interest and penalties) incurred by any indemnified party in
connection with any action, suit, proceeding, demand, assessment or judgment
incident to any of the matters indemnified against in this Section 5.02.
SECTION 5.03. RULES REGARDING INDEMNIFICATION.
(A) The obligations and liabilities of each indemnifying party hereunder
with respect to claims resulting from the assertion of liability by the other
party or third parties shall be subject to the following terms and conditions:
20
(1) The indemnified party shall give prompt written notice to the
indemnifying party of any claim which might give rise to a claim by the
indemnified party against the indemnifying party based on the indemnity
agreements contained in Sections 5.01 and 5.02 hereof, stating the nature and
basis of said claims and the amounts thereof, to the extent known. Provided,
however, that no such notice shall be given and no right of indemnification
shall arise in connection with the breach of a representation or warranty
contained herein, unless notice of such claim is made within the warranty
survival period set forth in section 3.03, hereof.
(2) In the event any action, suit or proceeding is brought against
the indemnified party, with respect to which the indemnifying party may have
liability under the indemnity agreements contained in Sections 5.01 and 5.02
hereof, the action, suit or proceeding shall, upon the written acknowledgment by
the indemnifying party, within thirty (30) days of receipt of notice of the
claim, that it is obligated to indemnify under such indemnity agreement, be
defended (including all proceedings on appeal or for review which counsel for
the indemnified party shall deem appropriate) by the indemnifying party. The
indemnified party shall have the right to employ its own counsel in any such
case, but the fees and expenses of such counsel shall be at the indemnified
party's own expense unless (a) the employment of such counsel and the payment of
such fees and expenses both shall have been specifically authorized by the
indemnifying party in connection with the defense of such action, suit or
proceeding, (b) the action, suit or proceeding seeks injunctive relief against
the indemnified party, only to the extent of defending against such injunctive
relief, and in such case, the indemnifying party shall not have to hire its own
counsel, or (c) such indemnified party shall have reasonably concluded and
specifically notified the indemnifying party that there may be specific defenses
available to it which are different from or additional to those available to the
indemnifying party or that such action, suit or proceeding involves or could
have an effect upon matters beyond the scope of the indemnity agreements
contained in Sections 5.01 and 5.02 hereof, in any of which events the
indemnifying party, to the extent made necessary by such defenses, shall not
have the right to direct the defense of such action, suit or proceeding on
behalf of the indemnified party. In such case only that portion of such fees
and expenses reasonably related to matters covered by the indemnity agreements
contained in Sections 5.01 and 5.02 hereof shall be borne by the indemnifying
party. The indemnified party shall be kept fully informed of such action, suit
or proceeding at all stages thereof whether or not it is so represented. The
indemnifying party shall make available to the indemnified party and its
attorneys and accountants all books and records of the indemnifying party
relating to such proceedings or litigation and the parties hereto agree to
render to each other such assistance as they may reasonably require of each
other in order to ensure the proper and adequate defense of any such action,
suit or proceeding.
(B) The indemnified party shall not make any settlement of any claims
without the written consent of the indemnifying party, which consent shall not
be unreasonably withheld or delayed. In the event the indemnifying party
chooses not to defend a claim for which the
21
indemnifying party agrees it is liable to defend, the indemnified party may make
a settlement of such claim without the prior consent of the indemnifying party.
(C) Except as herein expressly provided, the remedies provided in Sections
5.01 through 5.03 hereof shall provide each Party's sole remedy against any
other Party in the event of a breach of the representations and warranties
contained herein by such other Party.
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. ACCESS TO RECORDS. Sellers shall afford to Purchaser and its
agents, the opportunity, upon reasonable advance notice, to examine and make
copies of the books and records of the Seller relating to all periods through
the Closing Date, in connection with tax and financial reporting matters and
other bona fide business purposes.
SECTION 6 .02. PARTIES IN INTEREST. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by Sellers and their successors and
assigns, and Purchaser and its successors and assigns. Purchaser shall have the
right, upon prior notification to both Sellers, to direct either Seller to
convey title to any or all of the Purchased Assets acquired by Purchaser to
another entity or individual, in which event, the applicable conveyance
documents shall be in the name of such assignee.
SECTION 6.03. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other
writings referred to herein or delivered in connection herewith contain the
entire understanding of the parties with respect to its subject matter. This
Agreement may be amended only by a written instrument duly executed by all of
the parties.
SECTION 6.04 HEADINGS. The section and subsection headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
SECTION 6.05. NOTICES. All notices, claims, certificates, requests, demands
and other communications hereunder shall be in writing and shall be deemed to
have been duly given when mailed (by registered or certified mail, postage
prepaid) or sent by facsimile transmission, addressed as follows:
If to Purchaser, to:
Premier Parks Acquisition Company
c/o Premier Parks Inc.
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000 X. 00xx Xx., 00xx Xxxxx
Xxx Xxxx, XX 00000
(212) 000- 0000 (fax)
with a copy to:
Xxxx Marks & Xxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx, Esq.
(000) 000-0000 (fax)
If to Sellers or Wood, to:
Storytown USA, Inc. and
Fantasy Rides Corporation
c/o Xxxxxxx X. Xxxx Foundation
000 Xxxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Attn: Xxxxxxx X. Xxxx
(518) 000- 0000 (fax)
with a copy to:
Xxxxxx & Xxxx, P.C.
00 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxx, Esq.
(000) 000-0000 (fax)
or to such other address as the person to whom notice is to be given may have
furnished to the other in writing in accordance herewith. A communication given
by any other means shall be deemed duly given when actually received by the
addressees.
SECTION 6.06. PUBLIC ANNOUNCEMENTS. A public announcement relating to the
execution of this Agreement will be made, upon agreement by the parties hereto.
All other public announcements shall not require the previous agreement of the
parties provided such announcement concerns information which is otherwise
public and which does not disclose confidential or financial information of the
parties hereto.
SECTION 6.07. FURTHER ASSURANCE. After the Closing Date, without further
consideration, Sellers and Purchaser shall execute and deliver such further
instruments and documents as either party shall reasonably request to consummate
the transactions contemplated by this Agreement and to perfect Purchaser's title
to the Purchased Assets.
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SECTION 6.08. WAIVERS. Any party to this Agreement may, by written notice to
the other party hereto, waive any provision of this Agreement. The waiver by
any party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent or different breach.
SECTION 6.09. GOVERNING LAW. This Agreement shall be construed in accordance
with the laws of the State of New York.
SECTION 6.10. SEVERABILITY. If any provision of this Agreement shall be
declared void or unenforceable by any judicial or administrative authority, the
validity of any other provision and of the entire Agreement shall not be
affected thereby.
SECTION 6.11. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all counterparts together
constituting but one in the same document.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the date first above written.
STORYTOWN USA, INC.
By: /s/ Xxxxxxx X. Xxxx
-------------------------------------------
Xxxxxxx X. Xxxx, President
FANTASY RIDES CORPORATION
By: /s/ Xxxxxxx X. Xxxx
-------------------------------------------
Xxxxxxx X. Xxxx, President
/s/ Xxxxxxx X. Xxxx
----------------------------------------------
Xxxxxxx X. Xxxx
PREMIER PARKS ACQUISITION COMPANY
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------
Its: Chairman & CEO
PREMIER PARKS, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------
Its: Chairman & CEO
25
