EXHIBIT 2.1
CAR WASH
ASSET PURCHASE/SALE AGREEMENT
This CAR WASH ASSET PURCHASE/SALE AGREEMENT ("Agreement") is made to be
effective as of the Effective Date of Agreement set forth in Item 1 of Basic
Purchase Information ("BPI") by and between the "Buyer" shown in BPI Item 2 and
the Seller or Sellers (collectively "Seller") shown in BPI Item 3.
RECITALS
A. Seller owns one or more car wash operations ("operations") on leased or fee
simple property as set forth in BPI Item 4.
B. Seller desires to sell, and Buyer desires to buy, those operations and the
items pertaining thereto which are set forth in BPI Item 5, "Elements to be
Purchased."
THEREFORE, in consideration of the mutual covenants herein contained and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and incorporating the above RECITALS in full, Buyer and
Seller agree as follows:
Purchase And Sale of Assets
I A. Seller agrees to sell to Buyer, and Buyer agrees to purchase from
Seller, on the terms and conditions and in the manner set forth in this
Agreement, the following assets of the operations ("assets") :
(1) All of the furniture, fixtures, equipment, leasehold
improvements, and specified tangible assets shown on Exhibit "A."
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(2) Inventory. The most recent inventory taken by Seller is shown on
Exhibit "B." Seller will provide an updated inventory immediately
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prior to Close of escrow.
B. Seller represents that Exhibits "A" and "B" include each and every
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asset of Seller's entities and operations, other than cash on hand, life
insurance policies owned by Seller, excluded accounts receivable and inter-
company receivables, if any. These assets include, but are not limited to:
(1) Personal Property. All of Seller's right, title and interest in
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and to all Inventory, as defined and shown on Exhibit "B," equipment,
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machinery, tools, appliances, furnishings, furniture, goods held for
resale, receivables, customer lists, supplies, telephone and computer
equipment, and any other items used in connection with the business of
owning, operating, and managing the operations in BPI Item 4
(collectively, "Personal Property"), free and clear of any and all
liens, liabilities and encumbrances, and regardless of the location of
such Personal Property, whether on or off the premises of any
operation.
(2) Permits. All of Sellers' right, title and interest in, to and
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under all transferable permits, licenses, approvals or authorizations
obtained from any governmental authority relating to the business of
owning, operating and managing the operations ("Permits"), attached as
Exhibit "C."
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(3) Intangibles. All of Sellers' right, title and interest in, to and
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under all intangible personal property not otherwise described in this
Section and relating to the business of owning, operating and managing
the operations, including without limitation (a) all warranties in
favor of Sellers; (b) all liens and security interests in favor of
Sellers, together with any instruments or documents evidencing same;
(c) all telephone numbers associated with the operations; and (d) all
goodwill relating to the business of owning, operating, and managing
the operations (collectively, "Intangibles"). Attached hereto as
Exhibit "D" is a list of all Intangibles.
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(4) Trade Names and Trademarks. Buyer shall have the exclusive use of
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Sellers' trade names and trademarks, and other business names owned
and used by Seller, relating to the business of owning, operating, and
managing car wash operations, for an indefinite period, which period
shall terminate if, and only if, Buyer advises Seller in writing of
Buyer's relinquishment of this right. Buyer's rights include the use
of any and all derivatives and forms together with all trademarks,
service marks, and logos of the foregoing names, whether or not
registered and whether now owned or hereafter acquired, together with
all trademark registrations of and trademark registration applications
for the foregoing names, and all good will associated with any of the
foregoing (collectively, "Trade Names & Trademarks"). Trade Names and
DBAs are set forth in "Trade Names & Trademarks," BPI Item 6.
Exhibit "E," attached, contains all of the documents relating to the
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use and entitlement of such Trade Names, Trademarks, DBAs and logos.
(5) Entitlement. Entitlement to any and all advertising campaigns and
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marketing or promotional materials; and any and all guarantees and
warranties relating to the Inventory purchased hereunder
(collectively, "Entitlements"). Notwithstanding the foregoing, to the
extent Buyer redeems outstanding coupons issued by Seller, Seller will
be charged back for the costs of such redemptions.
(6) Books and Records. Copies of all Books and Records relating to
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the business of owning, operating, and managing the operations,
including without limitation all accounting, financial, employment,
sales and other records (collectively, "Books and Records"). Seller
shall be permitted to deliver originals of the Books and Records, in
which event, Buyer agrees to provide Seller reasonable access to the
Books and Records, including the copying thereof, and Buyer agrees to
maintain said Books and Records for a minimum of seven (7) years
following the Closing. Books and Records shall be promptly opened for
Buyer's inspection upon execution of this Agreement. Transfer of
Books and Records shall occur at Closing.
(7) Seller and Principals. "Seller" as used throughout this Agreement
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means an individual seller or, if there is more than one seller, all
of the Sellers taken collectively or any one or more of the Sellers
individually. "Seller" as used herein also means each and every
principal
of Seller, whether or not separately referenced. "Principal" as used
herein means a shareholder owning 10% or more of a corporation or one
who owns or has the beneficial interest in 10% or more of any entity,
including family or other trusts, or one who is an officer, director,
partner, member, or trustee of any entity. If there is more than one
Seller, any provision which requires consent of Seller shall be
construed so as to require only the consent of that Seller, or those
Sellers, with an interest in the subject matter requiring consent.
Such provision is not intended to confer any additional benefit or
power on any Seller which does not have an interest in the subject
matter or which is not the owner of the property/operation/stock for
which consent is required. If there is more than one Seller, Principal
or Guarantor, the liability of each, at all times, shall be joint and
several.
C. If leasehold interests are owned by Seller as lessee, for the premises
on which certain operations are conducted, Seller shall transfer such
leasehold interests pursuant to a valid assignment of lease and consent of
lessor. Documents evidencing these leasehold interests are attached as
Exhibit "F-1-Operating Leases." Documents evidencing the leases owned by
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Seller as lessor, if any, are attached as Exhibit "F-2-Seller's Leases."
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This Agreement is conditioned upon Buyer's review and approval of all
leases attached as Exhibits "F-1" & "F-2." Buyer and Seller shall
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cooperate in obtaining each lessor's consent to transfer leased premises to
Buyer.
D. Fee Simple Interests in Real Property, if any, shall be transferred
free and clear of all title defects and objections, security interests,
liens, claims, charges and encumbrances of any nature whatsoever. All Fee
Simple Interests in Real Property are set forth on the attached Exhibit "G"
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which includes:
(1) the real property and related operations ("Seller's Land");
(2) all buildings, together with all other improvements owned by
Seller, situated on Seller's Property as defined in Section IV,
including all fixtures and other property owned by Seller permanently
affixed thereto (the "Seller's Improvements");
(3) all Seller's Leases covering all or any portion of the Seller's
Property and Seller's Improvements; and
(4) all other rights and appurtenances of Seller pertaining to the
Seller's Property and Seller's Improvements, including, without
limitation, any right, title and interest of Seller in and to adjacent
streets, alleys or rights-of-way.
Amount of Purchase Price
II A. The total "Purchase Price" set forth in BPI Item 7 is based on the
earnings before interest taxes, depreciation and amortization ("EBITDA").
The EBITDA shown in BPI Item 8 and the "Effective Capitalization (`Cap')
Rate" in BPI Item 9, represents the sum of the purchase prices for all the
operations to be purchased, all personal, real and intangible assets (other
than Inventory), personal and corporate covenants not to compete, and the
guaranties contemplated herein. "Allocations" of the purchase price for
each operation and for the Covenants Not to Compete are shown on BPI Item
10. Inventory (which includes Seller's stock of gasoline, oil, lubricants,
filters, detergents, parts,
accessories and supplies) will be purchased at Seller's actual cost to
third parties (excluding Sellers' overhead and operating expenses).
Notwithstanding the foregoing, Buyer shall have no obligation to purchase
slow-moving or obsolete items carried by Seller as inventory.
B. The purchase price includes the physical assets in their condition at
the time of sale, without further adjustment. Buyer and Seller acknowledge
that the amount allocated to each asset represents its fair market value
determined pursuant to an arm's-length negotiation. They further
acknowledge that a tax attorney, accountant, or other qualified advisor has
explained the tax consequences of the allocations to them. Buyer and Seller
each agree to report the sale of the operations for federal income tax
purposes in accordance with the allocations set forth in this Agreement.
Payment of Purchase Price & Commissions
III A. The purchase price for each Covenant Not to Compete is included in the
Purchase Price and shall be disbursed at close of escrow.
B. The purchase price for each of the operations purchased is payable in
cash at close of escrow, less a "Hold-Back Percentage" specified in BPI
Item 11 of the total purchase price (operations and Covenants). The hold-
back shall be in effect for the Hold-Back Period specified in BPI Item 12.
To the extent that the hold-back is depleted during the hold-back period by
the "Hold-Back Depletion Amount" specified in BPI Item 13, or more, Seller
shall immediately deposit sufficient funds to bring the amount held-back to
its original level. Although the hold-back will terminate at the end of
the Hold-Back Period, the guarantees, warranties and representations for
which the hold-back was security, remain in effect for the "Guaranty
Period" specified in BPI Item 14, further extended by the time during which
a lawsuit could be brought relating to these items or, if a lawsuit or
other legal proceeding has been commenced, until the final decision in such
suit or proceeding. If a lawsuit or other legal proceeding is instituted
during the Hold-Back Period, the funds shall not be released but shall be
held until the final decision in such suit or proceeding. During the Hold-
Back Period, the funds held back shall be in an escrowed deposit, in an
interest-bearing account in one or more financial institutions approved by
both Buyer and Seller. Risk of loss of funds while on deposit shall be
with Seller and Seller shall receive all of the interest paid by each such
institution while on deposit. Loss of funds shall in no way relieve Seller
of its obligations hereunder and Seller represents and warrants that it has
sufficient funds to meet its obligations.
C. Buyer shall notify Seller and the manager of the escrowed account
promptly upon receipt of notice that a claim has been made with respect to
an item for which the hold-back is security. Seller shall have five (5)
days to object to disbursement of hold-back funds to pay the claim.
Objection must be in writing and state Seller's reasons for objecting. If
no reason has been stated or if Seller has not objected, disbursement in
accordance with Buyer's instructions shall be made immediately without any
need for instructions from Seller with respect thereto. If Seller has
objected, on a reasonable basis, and has brought suit, within 30 days of
notice to Seller of the claim, to challenge the claim, Seller shall
deposit the amount in dispute with the court, pending the final disposition
of the lawsuit. Seller shall be liable to Buyer for all detriment suffered
by Buyer during the pendency of the lawsuit.
D. Buyer and Seller have utilized the respective services, if any, of
those brokers, agents or finders listed in "Buyer's Broker" BPI Item 15 and
"Seller's Broker" BPI Item 16 in connection with the
sale of the assets relating to this Agreement. Each party agrees to pay its
Agent's fee, at close of escrow, pursuant to their separate agreements with
their Agents. Each party shall indemnify and hold the other party harmless
from any and all claims, expenses, demands, actions and costs thereof
arising in connection with this transaction to an Agent other than that
Agent specified in the BPI as that party's agent. Each party represents and
warrants that it has not employed any brokers or other representatives with
respect to this transaction and that if any brokers or finders make such a
claim, the employing party shall be solely responsible for any fees,
commissions, claims, expenses, demands, actions and costs thereof, with
respect thereto.
Documents and Physical Inspection
IV Seller shall immediately, or as soon as reasonably possible after the
effective date hereof, deliver to Buyer the following "Inspection Items":
A. Preliminary Owner's Title Policy binder for each of Sellers' Lands
issued by the "Title Company" specified in BPI Item 17, dated not earlier
than the Effective Date of this Agreement, showing the title to Seller's
Lands with two (2) copies of all items referred to as exceptions therein.
B. Two copies of all contracts, Operating Leases, Sellers' Leases,
subleases, tenant and landlord assignments, rent rolls, Fuel Station
Agreements (attached as Exhibit "H"), and documents which affect the
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ownership or operation of each Seller's Property (which as used herein
includes Seller Lands and/or operations).
C. Architectural drawings, plans and specifications as are available to
Seller for the improvements on each Seller's Property.
D. Two (2) copies of a current ALTA survey for each of the Seller's Lands
prepared by a competent person or entity to be selected by Buyer. The
survey shall be prepared according to the standards of Buyer, including
certification of zoning status.
E. Current financial statements for all tenants, if any, on each Seller's
Property, to the extent that the tenants are obligated to provide any such
information pursuant to the terms of Seller's Leases.
F. Tax returns, operating and other financial statements, prepared in-
house, or otherwise, for each Seller's Property for the three (3) most
recent fiscal years. Seller agrees to allow Buyer or Buyer's agent to have
access at Seller's applicable places of business and operations at
reasonable times and hours to inspect, copy as needed at Buyer's expense,
and audit Seller's files and records relating to the operations and to
Seller's Property.
G. Certificates of Occupancy for each Seller's Property.
H. A current Zoning Certificate for each Seller Property, which Seller
agrees shall be completed by the applicable governing municipalities to
include the same terms and be in the same form and content as the Zoning
Certificate attached hereto as Exhibit "I". Buyer will take steps to obtain
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this item, or otherwise confirm the zoning, and Seller will cooperate as
necessary.
I. Current tax receipts and insurance certificates for each Seller's
Property.
J. UCC searches of each Seller and Principal, in the county and state
where each Seller's Property is located, relating to Seller's Personal
Property and equipment being conveyed to Buyer, if applicable.
▇. ▇▇▇ appraisals of each Seller's Property, if available.
L. Other documents or reports reasonably required by Buyer in order to
allow Buyer to complete its due diligence review and inspection of Seller's
Property, including existing Phase I and Phase II reports.
Escrow
V A. Escrow ("escrow") shall be opened with the "Escrow Company" specified
in BPI Item 18, upon execution of this Agreement. If this Agreement has
not been fully executed and escrow has not opened by the "Escrow Opening
Date" specified in BPI Item 19, this Agreement shall terminate and neither
party shall have any further obligation to the other. This Agreement shall
operate as the basis for escrow instructions, with the understanding that
additional form instructions as required by escrow, which do not conflict
with this Agreement, shall be executed by the parties. In the event of any
differences between this Agreement and the escrow instructions, this
Agreement shall prevail. The deposit of this fully executed Agreement, by
either party, with escrow shall be deemed the opening of escrow, regardless
of the date escrow forms are signed by the parties.
B. Escrow shall take appropriate action to comply with bulk sales laws.
Seller shall be solely responsible for all sales, use and transfer taxes.
C. Each party shall pay its own attorney's fees. Escrow fees shall be
split equally by the parties, except for extraordinary costs which are for
the benefit, or at the sole request, of one party. Buyer shall deposit the
sum, specified as the "Initial Deposit" in BPI Item 20, in escrow within 10
days of escrow's opening. Escrow shall immediately deposit said sum in an
escrowed interest-bearing account. Interest from the sum so deposited
shall be credited to Buyer until the last of the following: Buyer withdraws
from the escrow, escrow closes, or the Initial Deposit becomes non-
refundable. The interest so credited shall be used either to reduce the
amount of Buyer's final deposit or shall be returned to Buyer if Buyer is
entitled to a return of the Initial Deposit. After the number of "Days
from Opening" specified in BPI Item 21 and provided that Seller has
provided each and every item required by Buyer from Seller to complete its
due diligence in accordance with the checklist provided by Buyer to Seller
and provided each such item is provided within a time period which will
allow Buyer to complete its due diligence, and provided Seller has not been
notified of disapproval by
Buyer of any element of the sale or that Buyer's contingencies have been
satisfied or removed, the Initial Deposit in escrow will become non-
refundable.
Notwithstanding the preceding, the Initial Deposit again becomes refundable
if, at any time, including after the number of "Days from Opening," any of
the following occur:
(1) Purchase of land or change in lease terms are a condition of this
Agreement and such purchase or change does not occur;
(2) Buyer disapproves of the state of Title or the ALTA survey;
(3) Buyer disapproves of the Phase I's or Phase II's;
(4) Information, financial and otherwise, supplied by Seller to Buyer
is inaccurate; or
(5) Escrow fails to close and Buyer is not at fault therefor.
At any time prior to the Initial Deposit becoming non-refundable, or upon
written disapproval of the Phase I's or Phase II's, Buyer may withdraw from
the escrow with no penalty or obligation to Seller. Buyer shall be under
no obligation, and it shall not be deemed Buyer's fault if Buyer does not
close escrow because of a failure of any condition in this Agreement.
Further, notwithstanding the lack of obligation to close escrow upon a
failure of a condition, it is specifically acknowledged by the parties that
each and every condition required by Buyer is for Buyer's benefit only and
Buyer has the absolute right to waive one or more or all conditions
precedent, in Buyer's sole discretion, and proceed with close of escrow.
If escrow fails to close due to fault of Buyer, the Initial Deposit is
agreed to be LIQUIDATED DAMAGES and each party shall initial here to show
their acceptance of this provision: ________________________[INITIAL HERE].
If escrow fails to close due to the fault of Seller, or if Seller attempts
to withdraw from escrow at any time after escrow has opened, as defined
herein, Buyer shall have the right to any and all remedies available at law
or in equity, including, but not limited to, an action for specific
performance or a declaratory judgment with respect to this Agreement.
D. All personal property taxes applicable to the assets shall be prorated
on a reasonable basis between Buyer and Seller as of the closing. Buyer
and Seller agree to make payments to each other as of the closing, to the
extent necessary to assure that both parties are reimbursed for the amount
of any personal property taxes that arise with respect to time periods
during which the assets were owned by the other party.
E. The balance of the Purchase Price, adjusted for allocations or credits
as set forth in this Agreement, shall be deposited prior to the scheduled
closing date. The price payable for Inventory shall be added to the
purchase price. Upon Closing, the Initial Deposit, together with all
interest accrued thereon, shall be applied as a credit to the Purchase
Price.
Conditions Precedent to Closing
VI A. Performance of Obligations. Seller shall have performed all of the
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obligations under this Agreement to be performed by Seller prior to the
Closing.
B. Delivery of Items. Seller shall have executed and delivered to Buyer
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all of the items referred to in this Agreement, including, without
limitation, the Guaranties and the Non-Competition Agreements
required in accordance with this Agreement. Buyer may use all or any
portion of the name by which the operations are known for an unlimited
time. Seller shall provide Buyer with all necessary documents to secure
such rights to Buyer. Seller shall transfer to Buyer all relevant telephone
numbers and telephone book ads, plus art work or copy necessary for same
and shall promptly execute all documents necessary to secure and retain
said items. In the absence of any specified time period for production of
items for Buyer, the applicable time period shall be 3 business days from
opening of escrow.
C. Consents. In connection with the sale of assets in this Agreement,
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Seller shall obtain and deposit into escrow, prior to Closing, all required
consents of third parties to this purchase transaction, including without
limitation, Fuel Companies listed on BPI Item 22; all of Seller's lessors;
and Seller's spouses, whose consents shall be in the form attached hereto
as Exhibit "J".
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D. Inventory. Seller shall maintain the Inventory at its current level.
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E. Creditors. Seller shall have paid or otherwise satisfied in full all
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creditors of Seller, relating to Sellers' prior ownership and operation of
the assets. Additionally, without limiting the foregoing, all Taxes, as
described in this Agreement, shall have been paid in full or otherwise
satisfied by Sellers.
F. Failure of Condition. In the event that any condition set forth in
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this Agreement is not satisfied prior to the Closing, all deposits shall be
fully refundable to Buyer, without the need of any oral or written approval
from Seller, on the Closing Date.
G. Sales & Other Taxes. Seller shall be solely liable and responsible for
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the payment of any sales, use and other transfer-type taxes that may be
payable by reason of the sale of the assets by Seller to Buyer pursuant to
this Agreement. In connection with the foregoing, Seller hereby agrees to
completely and unconditionally indemnify, defend and hold Buyer completely
harmless from and against any liabilities, obligations, claims, damages,
costs and expenses (including attorneys' fees) associated with or arising
out of Seller's obligation to pay all sales, use and other transfer type
taxes. Sellers' obligations under this section shall be part of Sellers'
Retained Liabilities as described below.
▇. ▇▇▇▇▇▇▇' Retained Liabilities. Buyer shall assume all debts and
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obligations shown on Exhibit "K." Except as specifically provided otherwise
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in Exhibit "K", Buyer has not agreed to assume, and shall not have any
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liabilities or obligations with respect to any of Seller's liabilities or
obligations, arising in connection with the use, operation and management
of Seller's operations, whether direct, indirect, absolute, accrued,
contingent or otherwise, and under no circumstances is Buyer assuming any
responsibility or liability to warrant any products sold by Seller or to
perform any warranty work on any products sold by Seller before, on or
after the Effective Date of this Agreement ("Sellers' Retained
Liabilities"). Except as otherwise provided in this Agreement, Seller shall
be solely liable and responsible for all of Seller's Retained Liabilities,
and hereby agrees to completely and unconditionally indemnify, defend and
hold Buyer completely harmless from and against any liabilities,
obligations, claims, damages, costs and expenses (including attorneys'
fees) associated with or arising out of Sellers' Retained Liabilities.
I. Shareholders' and Directors' Consent. The obligations of Seller
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hereunder are conditioned upon the necessary approval by the appropriate
persons or entities, including the Boards of Directors,
shareholders, partners, members, or other persons who by law or agreement
are entitled to consent or object to the subject transactions, which
condition precedent shall be satisfied on or before the "Consent Date"
specified in BPI Item 23.
J. Seller's Operational Obligations Pending Closing. Seller shall:
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(1) carry on Seller's operations with respect to Seller's Property in
accordance with sound business practice and, without the approval of
Buyer, not introduce any new method of management, operation or
accounting with respect to any Seller's Property;
(2) maintain each Seller's Property in its present condition subject
to normal wear and tear, and, without limiting the foregoing, not
diminish the quality or quantity of maintenance and upkeep services
heretofore provided to Seller's Property;
(3) not commit any default under any lease, mortgage financing,
license, permit, contract, or any other agreement in any way relating
to or connected with Seller's Property;
(4) pay off, in full, any and all existing loans relating to Seller's
Property so that there will be no loan encumbrances or liens from any
lenders relating to Seller's Property at Closing. Seller shall pay all
fees and costs necessary to release all loans and applicable liens,
including, but not limited to, any prepayment penalties;
(5) not grant or permit any new encumbrances on or about Seller's
Property, including, but not limited to, any new service contracts,
title matters or leases or amendments thereto, without the prior
written consent of Buyer. Seller shall not undertake or omit to
undertake any other act which may have a materially adverse impact on
Seller's Property;
(6) have pits/interceptors cleaned no more than sixty (60) days prior
to Close.
(7) promptly provide all documents reasonable or necessary, or
requested by Buyer, to complete Buyer's due diligence;
(8) make full disclosure of all matters, known to Seller, which might
have an effect upon the business or operation being purchased;
(9) facilitate Buyer's, or its representative's, inspection of
Seller's Property and operations throughout the escrow.
K. Inspection and Termination Rights. The Closing of this Agreement shall
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be totally contingent upon the satisfaction of the following conditions:
(1) Review and approval by Buyer's accountant of all financial
information relative to Seller and Seller's Guarantors. Financial
information will include, but is not limited to, the past 3 years' tax
returns, balance sheets, profit and loss statements, and credit
reports;
(2) Buyer's accountants' approval of the books, records, existing
contracts relating to stock, if any, which is part of this Agreement,
the operations, and the schedule of physical assets.
(3) Seller, or its agent, receiving a letter from Buyer outlining
Buyer's approval or disapproval of all Inspection Items. If such a
letter is not received by Seller, or its agent, on or before the time
specified in Section V. B., Buyer shall be deemed to have rejected one
or more of the Inspection Items, and this Agreement shall terminate in
its entirety and become null and void. If Sellers receive a letter
from Buyer disapproving or objecting to any of the Inspection Items,
Seller shall have the time period specified in Buyer's notice to cure
all of the objections and disapproved Inspection Items to the sole
satisfaction of Buyer or inform Buyer of its unwillingness to cure.
If any of the disapproved Inspection Items are not cured by Seller
within said time period (or if Seller is unwilling to cure), then
Buyer shall have the right to exercise one of the following options:
(a) terminate this Agreement in its entirety by giving Seller
written notice in which event this Agreement shall become null
and void; or
(b) accept the condition of the disapproved Inspection Items "As
Is" by giving written notice to the Seller of the same and close
on Seller's Property subject to all of the other terms and
conditions of this Agreement.
Seller's Representations and Warranties'
VII A. Each Seller, and Principal, jointly and severally, hereby represents
and warrants to Buyer that the statements contained in this Agreement and
its Exhibits and Addenda are true, accurate, complete, and not misleading
in any material respect, as of the Effective Date and further hereby
represents and warrants that each and every one of the following shall be
true and correct as of the Closing Date:
(1) Seller has good, valid and marketable title to stock, if any,
which is included in this transaction, all of the Real Property, all
of the Personal Property that is part of the assets, and the Trade
Names or Trademarks as described herein, free and clear of all title
defects and objections, security interests, liens, pledges, claims,
charges, restrictions and encumbrances (except as shown, and approved
by Buyer, in the preliminary title report) of any nature whatsoever,
including without limitation, leases, mortgages, conditional sales
agreements, collateral security arrangements, and other title or
interest retaining arrangements, whether absolute, accrued, contingent
or otherwise (collectively "Encumbrances"), other than liens for Taxes
currently accrued but not yet due and payable. All of the assets are
in operating order as necessary to conduct the operations currently
being conducted and as conducted on the Closing Date. Except as
otherwise specifically set forth in this Agreement, Seller has
complete and unrestricted authority and the unqualified right to sell,
assign, convey and transfer the assets to Buyer, and upon the
consummation of the transactions contemplated by this Agreement, Buyer
will have acquired good, valid and marketable title to stock, if any,
which is included in this Agreement, and to each of the assets, free
and clear of all Encumbrances.
(2) The Inventories that are part of the assets are usable and
saleable in the ordinary course of business, and are accounted for by
Seller at the lower of cost or market, and in accordance with
generally accepted accounting principles applied on a consistent
basis.
(3) There is no fact, circumstance or event that could result in
claims, actions, suits, disputes, investigations, arbitrations and
other proceedings of any kind, existing, pending or threatened, that
involve, affect or relate to Seller (or any of its directors, officers
or employees), or Principals, in connection with the operations,
business and affairs of Sellers. There are no agreements, decrees,
orders, or injunctions of or with any court or governmental entity
outstanding against Sellers.
(4) All structures and improvements on Seller's Property have been
constructed and installed in a good and workmanlike manner and in full
compliance with all applicable laws, conditions and restrictions
affecting Seller's Property.
(5) Each Seller Property is properly zoned for the improvements
situated thereon.
(6) There are no threatened, existing or pending litigation,
judicial, administrative, or arbitration hearings, claims,
condemnations, or sales in lieu thereof, contracts of sale, options to
purchase or rights of first refusal with respect to any aspect of
Seller's Property, or stock, nor have any such actions, suits,
proceedings, claims, or other such matters been threatened or
asserted.
(7) Other than as set forth on Exhibit "L", there are no service
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contracts relating to any Seller's Property which cannot be
terminated within thirty (30) days notice by Seller or by Buyer, upon
Buyer becoming the owner of Seller's Property.
(8) Seller has received no notice and has no knowledge of any pending
improvements, liens, or special assessments to be made against any
Seller's Property by any governmental authority.
(9) There are no unpaid bills or claims in connection with the
construction of, or any repairs to, Seller's Property.
(10) Seller's Leases and Operating Leases for each leased premise is
in good standing and Seller is not in default thereon. Seller has
made, or will make, on or before the Effective Date, all payments due
to the lessor of each leased property in connection with the Operating
Leases for the occupancy period up to and including Close of escrow.
(11) Seller remains responsible for repairing any damage caused to
Seller's Property, accruing prior to Closing, for which Seller would
be liable to repair under the terms of any leases, and for any damage
caused to Seller's Property accruing on or after Closing directly
attributable to actions by Seller and Principals prior to Closing.
(12) There has been no hazardous waste dumped or deposited on Seller's
Property and no hazardous waste exists thereon. There are no hazardous
materials, including asbestos, existing on Seller's Property and each
of the items (a) through (i) immediately below are correct. If any
such hazardous waste or material is found to exist thereon, Seller
shall be given the opportunity to accept full responsibility for the
removal of such waste or material, at Seller's sole cost and expense,
and indemnify Buyer relating to any damages or costs
associated with the presence of such waste or material, or the removal
thereof. In the event Seller rejects such opportunity, Buyer shall
have the choice of eliminating the hazardous waste or hazardous
material site, or the stock which represents ownership of the site,
from the purchase and deducting the allocations of the purchase price
attributable to such site; completing the purchase of all properties,
but deducting the clean-up cost from the purchase price; or
terminating this transaction in its entirety without any liability to
Seller and with re-entitlement to the Initial Deposit.
(a) Seller has not received any notification from a
governmental agency pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act, as
amended (including without limitation, any amendments added
by the Superfund Amendment and Reauthorization Act of 1986),
or pursuant to any other law pertaining to waste materials,
hazardous materials or substances, pollutants or other such
matters affecting the environment, and Seller is not aware
of any facts or circumstances which could give rise to a
violation of any such laws in the future.
(b) If this Agreement includes sites which do not currently
have tanks on them, Seller has not placed any underground
tanks on such sites, and Seller is not aware of any
underground tanks existing on such sites.
(c) There has been no release, emission or discharge into
the environment of waste materials, hazardous substances,
hazardous wastes, air pollutants, or toxic pollutants, as
defined under any applicable legal requirement (including,
without limitation, any leakage from any tank), and that
none has occurred or is occurring in connection with the
business and operations of Seller, except such that have
been remedied and subsequently approved by the appropriate
governmental agency.
(d) No asbestos or asbestos-containing materials are
installed on, used on, or incorporated into Seller's
Property. No polychlorinated biphenyls are used in any
electrical transformers, capacitors, fluorescent light
fixtures or in any other manner whatsoever on any real
property leased or used by Seller.
(e) Seller has at all times complied, and is currently in
compliance, with all requirements of the Safe Drinking Water
and Toxic Enforcement Act of 1986.
(f) Seller has not at any time, now or in the past, engaged
in any environmental cleanup, or any other remediation,
except such that have been approved by the appropriate
governmental agency.
(g) Seller has never violated and is not currently in
violation of any applicable federal, state, county or local
statutes, laws, regulations, rules, ordinances, codes,
licenses, or permits of any governmental authorities
relating to environmental matters, including radiation
safety, in connection with the ownership, use, maintenance,
or operation of any of Seller's assets or the conduct of
Seller's business or operations.
(h) There are no statutes, laws, orders, ordinances, codes,
licenses, permits, rules or regulations relating to
environmental matters, that would require any work, repairs,
construction or capital expenditures of a material nature
(10% or more of the purchase price allocated to the affected
Seller's Property) with respect to any of the facilities,
equipment or other assets of Sellers.
(i) Seller have not received any notices of any violation
in connection with any of the matters described in this
section.
(13) There are no condemnation or eminent domain proceedings pending
or contemplated against any Seller's Property or any part of a
Seller's Property and Seller has received no notice, oral, written or
constructive, of the desire of any public authority or any other
entity to take or use any Seller's Property or any part of a Seller's
Property.
(14) Each Seller is not a "foreign person" within the meaning of
Section 1445 of the Internal Revenue Code of 1986, as amended.
(15) Each Seller is fully empowered to enter into this transaction
and execute all of the documents related to this transaction as such
pertains to its respective stock and Seller's Property.
(16) Each entity listed on BPI Item 3 as Seller, is organized,
existing and in good standing under the laws of the State in which it
was formed and is in good standing and qualified to conduct business
in the state in which it is doing business. Seller is in good
standing as certified by both the relevant corporation commission and
the duly authorized taxing authority for the State in which Seller is
conducting the operations which are the subject of this Agreement.
(17) The shareholders, owners of beneficial interests, members,
partners, and trustees of each corporate or other entity are listed on
BPI Item 3 They are the sole owners of the stock and operations, and
no other person has any claim, right, title to, or interest in, these
operations.
(18) Seller has no material undischarged obligations affecting the
operations or assets being sold pursuant to this Agreement, other than
obligations arising in the usual and regular course of business and
listed in the attached document marked Exhibit "K."
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(19) Seller has paid, or shall pay, all taxes owed by Seller on
account of the operations.
(20) The books of account for the operations constitute a complete
record of the financial affairs of each operation and accurately set
forth all liabilities, assets, and other matters regarding the
financial condition of the operations.
(21) The purchase and sale will not conflict with or violate any
agreement or law to which Sellers, the stock, if any, which is part of
this transaction, or the operations are subject.
(22) Neither the execution and delivery of this Agreement or the Other
Documents (defined in "23" below), nor the transfer of stock, nor the
consummation of any of the transactions contemplated by this Agreement
or the Other Documents, nor compliance by Seller and/or the Principals
with any of the provisions thereof, will require any consent,
approval,
authorization or permit from, or any notice, registration or
filing to or with, any governmental or regulatory authority or
any other third party, except as specifically set forth herein in
VI. C. - Consents.
(23) Seller and each signatory have the complete and unrestricted
right, power, authority and capacity to (a) execute and deliver
this Agreement and every other document executed and delivered by
Seller in connection with this Agreement ("Other Documents"); (b)
sell and transfer the assets to Buyer; and (c) carry out and
perform each of Seller's obligations pursuant to this Agreement
and the Other Documents.
(24) All corporate, limited liability company, partnership,
member, partner and shareholder authority, approvals, actions or
proceedings necessary on the part of Seller to authorize this
Agreement or any of the transactions contemplated hereby, will
have been obtained prior to the "Consent Date" in BPI Item 23.
(25) This Agreement and the Other Documents have been or will be
duly and validly executed and delivered by Seller and Principals
(as applicable); and when executed and delivered constitute
legal, valid and binding obligations of Seller, enforceable in
accordance with their terms.
(26) Neither the execution and delivery of this Agreement or the
Other Documents, nor the consummation of any of the transactions
contemplated by this Agreement or the Other Documents, nor
compliance by Seller with any of the provisions thereof, will:
(a) Violate, conflict with, or result in a breach of any of
the provisions of; constitute a default (or an event which,
upon notice or lapse of time or both, would constitute a
default) under; result in the termination or cancellation
of; accelerate the performance required by; or result in the
creation of any lien, security interest, charge or
encumbrance upon any of the assets under any provision of
the Articles, the Bylaws, the Operating Agreement, or any
note, bond, mortgage, indenture, deed of trust, lease,
license or any other agreement or obligation to which Seller
is a party, or by which Seller or any of the assets may be
bound or affected; and
(b) Violate or conflict with any order, writ, injunction,
decree, judgment, permit, license, law, rule, regulation or
ordinance applicable to Seller or any of the assets.
(27) If this Agreement includes a purchase of stock, that stock
is not subject to any restrictions on transfer, governmental or
private, rights of first refusal, voting trusts, proxy
agreements, or any other shareholder rights, member rights, third
party rights, or other governmental restrictions.
Buyer's Representations and Warranties'
VIII A. Buyer is duly organized, validly existing and in good standing under
the laws of the state in which it was incorporated or formed.
B. Buyer has the complete and unrestricted right, power, authority and
capacity to (1) execute and
deliver this Agreement and every other document executed and delivered by
Buyer in connection with this Agreement ("Additional Documents"); and (2)
carry out and perform each of Buyer's obligations pursuant to this
Agreement and the Additional Documents.
C. Any corporate, limited liability company, shareholder and member
authority, approvals, actions or proceedings necessary on the part of Buyer
to authorize this Agreement or any of the transactions contemplated hereby,
will have been obtained prior to the Closing.
D. This Agreement and the Additional Documents have been or will be duly
and validly executed and delivered by Buyer, and when executed and
delivered will constitute legal, valid and binding obligations of Buyer,
enforceable in accordance with their terms.
Risk of Loss
IX A. Until the Closing, to the extent covered by Insurance, Seller shall
bear all risk of loss, injury, damage, or destruction of the assets of the
operations. If any loss, injury, damage, or destruction substantially
impairs the value of the operations prior to the closing, Buyer must give
written notice to Seller, within 7 days after Buyer has received notice of
the damage or destruction, of Buyer's election to choose one of the
following: (1) terminate this Agreement, in which event this Agreement
shall become null and void; (2) extend the Closing Date to a reasonable
time, which time shall not exceed ninety (90) days, in order to enable
Seller to repair such damage to Seller's Property, and in such an event,
Seller shall promptly repair such damage, and such damage shall be repaired
so that the Seller's Property will conform to the representations and
warranties contained herein; or (3) proceed to closing and receive an
assignment of applicable insurance proceeds. For purposes of this Section,
''substantially impairs'' means that the cost of restoring the assets to
their condition as of the date of execution of this Agreement is ten
percent (10%) or more of the purchase price allocated to the Seller's
affected Property. After the closing, the Buyer shall bear all risk of
loss, injury, damage, or destruction of the assets.
B. The risk of loss until Closing due to condemnation by eminent domain
from an applicable governmental authority shall be borne by Seller. In the
event any portion of Seller's Property is condemned or is planned to be
condemned by an applicable governmental authority prior to Closing, Buyer
shall have the right to exercise one of the following options: (1)
terminate this Agreement in its entirety by giving written notice to Seller
within ten (10) days after Buyer receives notice of said condemnation from
Seller in which event this Agreement shall become null and void; or (2)
Buyer may accept Seller's Property in its condemned state, "As Is," and
proceed to close on Seller's Property according to the remaining terms of
this Agreement. In this event, Buyer shall be entitled to all the proceeds
awarded relating to said condemnation.
Employees of Sellers
X Buyer and Seller agree that Buyer has no obligation to hire employees of
Seller in connection with this Agreement. Should Buyer desire to hire one
or more of Seller's employees, Seller agree to terminate, upon Buyer's
request, such employees, and Seller shall pay all outstanding wages,
benefits, accrued vacation and sick pay, and related employment taxes, upon
termination.
Closing
XI A. Time and Place. The performance of all matters to be performed upon
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the closing of the purchase and sale of the assets or stock contemplated by
this Agreement ("Closing"), shall take place at the escrow offices on or
before the "Date for Close of Escrow" specified in BPI Item 24, or at such
other time and place as Seller and Buyer agree in writing. For purposes of
this Agreement, the term "Closing Date" or "Closing" means the date upon
which the Closing actually occurs.
B. Delivery of Instruments Within the time periods set forth elsewhere in
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this Agreement, or, if none are specified, in sufficient time to meet all
obligations of this Agreement, but, in any event, prior to the date
scheduled for Closing, Seller shall deposit in escrow or deliver to Buyer
the following items which shall be in the form and substance satisfactory
to Buyer:
(1) Special Warranty Deed for each Seller's Land.
(2) ALTA (extended form) Owner's Title Policy for each Seller's
Land (the "Owner's Title Policies") issued by the Title Company,
in the full amount of the Purchase Price allocated to that Land,
containing no exceptions to title other than the standard printed
exceptions (provided that the area and boundaries exceptions
shall be amended, restrictive covenants endorsed "none of
record", taxes endorsed "not yet due and payable", the parties in
possession endorsed "pursuant to written leases," and there shall
be no exception for visible and apparent easements on roads and
highways), and any exceptions which have been approved by Buyer
in writing, which shall include, but not be limited to, the
following five (5) standard title endorsements:
100 Assurance against loss from violations of the
Reciprocal Easement, Covenants and Restrictions
Agreement ("REA") and other matters if such REAs or
other matters encumbering each Seller's Lands.
116.4 Assurance that each of the parcels of land described
in the policy and the REA are contiguous parcels, if
applicable.
103.6 Assurances that the improvements on each of the
Seller's Lands do not encroach onto any easement.
103.7 Assurance that each of the Seller's Lands abuts on
and has access to a physically open street as
identified in the endorsement.
116.1 Assurance that the property described, for each
Seller's Lands, in the policy is the same property as
shown on the survey.
The Owner's Title Policies shall include any other endorsement which
may be required by Buyer to cure a title objection, provided Buyer is
solely responsible for the additional costs, if any, of any such
endorsement.
(3) Original copies of the Operating Leases and Seller's Leases,
and their respective subleases, if any, and all of the original
amendments and guarantees relating thereto together with valid
assignments of lease/s, executed by Seller and acknowledged
before a notary public, assigning to Buyer all Seller's interests
under the lease/s and valid consents to the assignments executed
and acknowledged by the respective lessors.
(4) Evidence that those acting for Seller, have full authority
to consummate this transaction in accordance with the terms of
this Agreement, as modified through Closing, including, but not
limited to, an opinion of Seller's counsel(s) and certified
copies of the resolutions authorizing this transaction.
(5) An affidavit that all charges related to each Seller's
Property, as of the Closing, have been paid in full, except that
any charges which have not been paid in full relating to services
to any Seller's Property which were performed on or prior to the
Closing shall be credited by the Seller to the Buyer at Closing.
(6) All original warranties and guarantees, which the Seller has
received in connection with any work or services performed or
equipment installed on Seller's Property, together with a duly
executed assignment and assumption thereof to Buyer in a form
acceptable to Buyer.
(7) All keys relating to each Seller's Property.
(8) All other documents or instruments which affect title to, or
possession of, Seller's Property and/or which are necessary to
transfer or assign the same to Buyer or to complete the Closing.
(9) ▇▇▇▇(s) of sale, in the form of Exhibit "M" executed by
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Sellers, conveying to Buyer all the assets described in Section 1
of this Agreement.
(10) Certificates from the appropriate state governmental entity
showing that no amounts are due from Seller, on account of the
operations, for unemployment compensation insurance
contributions, disability compensation insurance contributions,
or state income taxes withheld from employee wages.
(11) A counterpart copy of each of the Guaranty Agreements, duly
executed by Seller and Principals.
(12) A counterpart copy of each of the Non-Competition
Agreements, duly executed by Seller and those Principals
designated by Buyer.
(13) Resolutions of the Boards of Directors of Sellers, approving
Seller's execution and delivery of this Agreement, and Seller's
performance of all of the obligations of Seller pursuant to this
Agreement.
(14) A certificate duly executed by Seller stating that (a) all
of the representations and warranties made by it in this
Agreement or in the Other Documents are true, accurate and not
misleading in any material respect as of the Closing Date, and
(b) Seller has performed all of its respective obligations
required to be performed prior to the Closing Date.
(15) At the Closing, Seller will place Buyer in complete
possession of all stock (if applicable), assets and all records
of Seller that are part of the assets.
C. Deliveries of Buyer at the Closing. At the Closing, Buyer shall
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deliver the following items to Seller:
(1) A counterpart copy of each of the Non-Competition Agreements
duly executed by Buyer;
(2) The Purchase Price required to be paid pursuant to Section
II.A.
(3) Any other items required to be delivered by Buyer to Seller,
upon the Closing, pursuant to this Agreement.
D. Prorations. Buyer and Seller shall prorate all of the following, on
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the basis of 30-day months, as of 12:01 A.M. Pacific Daylight time on the
date specified in BPI Item 24 for the Closing:
(1) All personal and real property taxes levied or assessed
against any of property subject to this Agreement, for the
current tax year, based on the amount shown on the latest tax
▇▇▇▇.
(2) All premiums on insurance policies insuring the operations
or the assets subject to this Agreement that have been approved
by and are being transferred to Buyer.
(3) The lease payments/rents of the Operational Leases, if any.
(4) The lease payments/rents, security deposits and advance
payments of Seller's Leases, if any.
(5) The charges or prepayments on any assumed contracts.
E. Seller's Closing Costs. At Closing, Seller shall pay (1) the premiums
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for the Owner's Title Policies and shall be reimbursed by Buyer for the
survey costs necessary to procure the same, (2) documentary transfer, deed,
stamp or other similar taxes, (3) one-half of the escrow fees, (4) Broker's
Fees/Commissions, and (5) Seller's attorneys' fees in connection with the
preparation of this Agreement and carrying out the transaction described
herein.
F. Buyer's Closing Costs. At Closing, Buyer shall (1) pay one-half of the
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escrow fees, (2) reimburse seller for ALTA survey costs, (3) Broker's
Fees/Commissions, and (4) pay Buyer's attorneys' fees in connection with
the preparation of this Agreement and carrying out the transaction
described herein.
Environmental Reports
XII Buyer shall obtain, at its expense, current Phase I Environmental Audits
("Phase I's") and/or Phase II Environmental Audits ("Phase II's"), each to
be performed by an individual or company of its choice, for each Seller's
Property. Seller shall obtain any required Lessor's consent for Buyer to
perform the Phase I's or Phase II's with respect to leased property. In
the event Buyer fails to notify
Seller of Buyer's disapproval of the Phase I's or Phase II's within the
time period set forth in Section V. B., Buyer shall be deemed to have
rejected the Phase I's and/or Phase II's as not satisfactory. If escrow
does not close by reason of Seller's fault, Seller shall reimburse Buyer
for all Phase I and Phase II reports. In the event Buyer notifies Seller
that Buyer is not satisfied with the Phase I's or Phase II's, Buyer shall
have the right to exercise one of the following options:
(1) request Seller to cure (at Seller's option), within a reasonable
time and to Buyer's satisfaction, all objections to Phase I's or Phase
II's. Buyer shall advise Seller, what Buyer determines to be a
reasonable time under the circumstances. If Seller decide not to
cure, then Buyer may choose to
(2) terminate this Agreement in its entirety by giving Seller written
notice in which event this Agreement shall become null and void; or
(3) accept environmental condition "As Is" by giving written notice
to Seller of the same and close on the Seller's Property subject to
all of the other terms and conditions of this Agreement being
satisfied.
Taxes
XIII For purposes of this Agreement "Taxes" means any federal, state, local or
foreign, income, alternative or add-on minimum, business, employment,
franchise, occupancy, payroll, property, sales, transfer, use, withholding
or other tax, levy, impost, fee, imposition, assessment or similar charge,
together with any related additions to tax, interest, penalty or fine
thereon; and (b) "Returns" means all returns, (including without
limitation, information returns and other material information), reports,
and forms relating to Taxes. Seller has duly filed all Returns required to
be filed by Seller with regard to tax periods ending on or before the
Closing Date. All such Returns are accurate and complete and were prepared
in conformity with all applicable laws and regulations. Seller has duly
paid in full all Taxes shown to be due on such Returns or otherwise
assessed against Seller, and has made adequate provision (by the
establishment of reserves or otherwise) for all Taxes relating to or
arising in connection with any tax period ending on or before the Closing
Date. There are no tax liens upon the assets. There are no outstanding
agreements or waivers by Seller for the extension of time for the
assessment of any Taxes. Seller is not a party to any pending action or
proceeding by any governmental authority for the assessment or collection
of any Taxes, and no claim for assessment or collection of any Taxes has
been asserted against Seller that has not been paid. There are no pending
or threatened audits, investigations, or claims for or relating to any
liability regarding Seller's obligations to pay Taxes. Seller shall be
solely liable and responsible for all of Seller's Taxes, and hereby agrees
to completely and unconditionally indemnify, defend and hold Buyer
completely harmless from and against any liabilities, obligations, claims,
damages, costs and expenses (including attorneys' fees) associated with or
arising out of Seller's Taxes.
Confidentiality of Agreement/Publicity
XIV The terms and conditions of this Agreement are and shall at all times
remain confidential, both before and after Closing, and before and after
any termination hereof. No provision of this Agreement shall be disclosed
by any party without the prior written consent of all of the other
parties. All publicity concerning the transactions contemplated by this
Agreement shall be jointly planned and coordinated
by Buyer and Seller. No party shall permit the dissemination of any
publicity regarding the transactions contemplated by this Agreement
without the prior written consent of the other parties. Any consents
requested or otherwise required pursuant to this Section XV shall not be
unreasonably withheld by any party.
Non-Competition Agreements-
XV In connection with the sale of these operations and sales of stock, and
prior to Closing, Seller and those Principals designated by Buyer, and any
other individuals or companies listed in BPI Item 3 shall execute and
deliver respective non-competition agreements in the form of Exhibits
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"N-1- Non-Competition-Corporate" and "N-2-Non-Competition-Individual" to
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this Agreement (collectively "Non-Competition Agreements" and individually
"Non-Competition Agreement-Corporate," and "Non-Competition Agreement-
Individual"). As additional consideration for this Agreement and pursuant
to their respective Non-Competition Agreements, Seller and Principals
agree that they shall not directly or indirectly compete with Buyer or
carry on or engage in the operation of a car wash within the "Non-Compete
Area" for the "Non-Compete Period" each of which is specified in BPI Item
25.
Indemnity/Guaranty Agreements
XVI Except as otherwise expressly provided in this Agreement, Seller and
Principals shall indemnify Buyer and hold Buyer's property, including the
property described in this Agreement, harmless from any and all expenses,
claims, losses, damages, injuries, and liabilities ("Loss") arising from
or on account of Seller's operations or Seller's lease or ownership of any
of the property described in this Agreement. Seller and Principals shall
execute Guaranty Agreements as set forth in Exhibit "O."
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Introduction to and Retention of Customers
XVII Pending the closing, Buyer shall have the right, during normal business
hours, at times, and under conditions agreed upon by Seller, to frequent
the locations where Seller conducts its operations. Seller shall use its
best efforts to introduce Buyer to Seller's customers and others with whom
Seller does business in connection with its operations, as Seller's
successor to the practice. Seller shall, in every manner encourage its
present and former customers and suppliers to frequent Buyer's operations
or otherwise conduct business with Buyer.
Ownership of Equipment
XVIII All of the equipment is owned by the companies listed as Seller. Seller
represents that none of the equipment is leased.
Amendments/Waivers
XIX This Agreement may be amended, supplemented, modified or rescinded only
through an express written instrument signed by all the parties or their
respective successors and assigns. Either party may specifically and
expressly waive in writing any portion of this Agreement or any breach
hereof,
but no such waiver shall constitute a further or continuing waiver of any
preceding or succeeding breach of the same or any other provision. The
consent by one party to any action for which such consent was required
shall not be deemed to imply consent or waiver of the necessity of
obtaining such consent for the same or similar acts in the future. All
remedies, rights, undertakings, obligations and agreements contained in
this Agreement shall be cumulative, and none of them shall be in limitation
of any other remedy, right, undertaking, obligation or agreement of any
party, except as set forth in the liquidated damages clause. The failure by
any party hereto at any time to enforce any of the provisions of this
Agreement, or to require at any time performance of any of the provisions
hereof, shall in no way be construed to be a waiver of such provisions or
to affect either the validity of this Agreement or the right of any party
to thereafter enforce each and every provision of this Agreement. UNDER NO
CIRCUMSTANCES SHALL A GUARANTOR HAVE THE RIGHT TO APPROVE, NOR SHALL THERE
BE ANY NEED FOR APPROVAL OF, ANY WRITTEN MODIFICATION OF THIS AGREEMENT OR
ANY AMENDMENTS HERETO.
Attorneys' Fees
XX In the event that any party brings a legal action or proceeding to enforce
the obligations of this Agreement or to exercise any of its rights or
remedies, or if any party is required to defend the validity or
enforceability of the obligations of this Agreement in any action or
proceeding, the prevailing party shall be entitled to an award of its
attorneys' fees and costs and expenses incurred in bringing or defending
the action or proceeding, regardless of the forum in which the resolution
is determined and regardless of whether such legal action is prosecuted to
judgment.
Notices
XXI Notices shall be written and deemed given when personally delivered or 3
days after deposit in the U.S. Mail, registered or certified, return
receipt requested, or on date signed for when sent by expedited mail or
courier service where receipt can be confirmed, and addressed to the
parties or guarantors at their respective addresses specified in BPI Item
26, subject to change by written notice. Notices may also be given and
will be effective as of the first business day following the date of
transmission if (i) sent over electronic transmitting devices, such as
facsimile, Telex, telecopy machines, and computers; (ii) the party to
whom the notice is being sent has such a device in its office and (iii) a
complete copy of any notice so transmitted shall have also been mailed in
the same manner as required for a mailed notice. Avoidance of or refusal
to accept service shall be deemed acceptance.
Time of Essence
XXII Time is of the essence with respect to the performance of each party's
obligations hereunder.
Severability
XXIII In the event that any provision of this Agreement becomes or is declared
by a court of competent jurisdiction to be illegal, unenforceable or
void, then this Agreement shall continue in full force and effect without
said provision. Provided, however, that no such severability shall be
effective if it materially changes the economic benefit of this Agreement
to any party.
Exhibits
XXIV All exhibits and addenda described in this Agreement and the BPI are
incorporated herein by reference as if fully set forth herein, and
constitute a material part of this Agreement. The parties hereby
specifically approve the form and substance of any such exhibits and
addenda. In the event of any conflict between the provisions of this
Agreement and the provisions of any such exhibits and addenda, the
provisions of such exhibits and addenda shall govern.
Diligence, Good Faith and Further Documents
XXV The parties specifically agree to act diligently, in the utmost good
faith and in a timely manner to perform their respective obligations
pursuant hereto, and to carry out the reasonable intent of the provisions
of this Agreement. Each of the parties agrees to cooperate in good faith
with the other, and to execute and deliver such further instruments and
perform such other acts as may be reasonably necessary or appropriate to
consummate and carry into effect the transactions contemplated by this
Agreement.
Survivability
XXVI All of the representations and warranties of Seller and Principals
pursuant to this Agreement and the Other Documents shall survive the
Closing.
Entire Agreement
XXVII This Agreement constitutes the entire understanding between Buyer and
Seller concerning its subject matter and all representations, agreements,
arrangements and understandings between or among the parties, whether
oral or written, have been fully merged herein and are superseded hereby,
except to the extent fully executed management contracts have been
previously entered into between Seller/Principals and Buyer. Any
agreements, representations, letters, conversations, or proposals
respecting the operations or the sale of assets not expressly set forth
in this Agreement shall have no effect except for a subsequent written
modification signed by the party to be charged.
Assignment Prohibited
XXVIII Neither this Agreement, nor any interest herein, shall be assignable
(voluntarily, involuntarily, by judicial process or otherwise) by any
party hereto to any person or entity without the prior written consent of
the other executing party. Any attempt to assign this Agreement without
such consent shall be void. Notwithstanding the above, Seller may assign
any and all rights to receipt of payments.
Successors
XXIX Subject to the foregoing section, this Agreement shall be binding upon
and inure to the benefit of the parties and their respective heirs,
legatees, legal representatives, successors and permitted assigns.
Governing State Law
XXX This Agreement shall be governed by and interpreted in accordance with
the internal laws of the State shown in BPI Item 27, "Governing State
Law," including all matters of construction, validity, performance and
enforcement, without giving effect to principles of conflict of laws. Any
dispute, action, litigation or other proceeding concerning this Agreement
shall be instituted, maintained, heard and decided in the county shown in
BPI Item 28, "County Jurisdiction."
Counterparts
XXXI This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument and agreement.
Remedies
XXXII All rights, remedies, undertakings, obligations, options, covenants,
conditions and agreements contained in this Agreement shall be cumulative
and no one of them shall be exclusive of any other. If Seller defaults in
performing any of Seller's obligations under this Agreement for any
reason, or if any of the representations or warranties of Seller herein
are untrue at Closing, Buyer may, at its option, either terminate this
Agreement or seek to enforce specific performance of this Agreement.
Interpretation
XXXIII The language in all parts of this Agreement shall be in all cases
construed simply according to its fair meaning and not strictly for or
against any party. Whenever the context requires, all words used in the
singular will be construed to have been used in the plural, and vice
versa, and each gender will include any other gender. The captions of the
sections of this Agreement are for convenience only and shall not affect
the construction or interpretation of any of the provisions herein. All
cross-references refer to provisions within this Agreement, and shall not
be deemed to be references to the overall transaction or to any other
agreement or document. Each party has been represented by an attorney
throughout this transaction and has had his or its attorney review this
Agreement. "Shall" or "will" as used herein is mandatory. "May" is not
mandatory. Any list or specifications of items herein is deemed to be all
encompassisng and without limitation, unless such limitation is
specifically stated. The foregoing applies whether or not preceded or
followed by the phrase "included, but not limited to" or "included,
without limitation," or similar language.
Benefit of Agreement
XXXIV This Agreement is for the sole and exclusive benefit of the signatories
hereto and nothing in this Agreement shall be construed to give any
person or entity other than the parties hereto any legal or equitable
right, claim, or remedy.
Miscellaneous
XXXV Unless expressly set forth otherwise herein, all references herein to a
"day", "month" or "year" shall be deemed to be a reference to a calendar
day, month or year, as the case may be.
EXECUTED to be effective on the date first set forth herein.
BUYER:
MILLENNIA CAR WASH LLC,
a Delaware limited liability company
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chairman & CEO
SELLER:
QUAKER CAR WASH, INC.,
A Texas corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
PRINCIPAL:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ [100% shareholder]
GUARANTORS:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
ATTACH NOTARIZATIONS HERE:
CAR WASH ASSET PURCHASE/SALE AGREEMENT
BASIC PURCHASE INFORMATION
1. Effective Date of Agreement August 26, 1998 [Preamble]
---------------
2. Buyer: MILLENNIA CAR WASH LLC
[Preamble] a Delaware Limited Liability Company
3. Seller: Quaker Car Wash, Inc.
----------------------
a Texas corporation
-------------------
[Preamble] & [Seller's Representations and Warranties]
4. Operations:
Name and Location of Car Wash/Operation:
[Recitals]
▇▇▇▇▇ Car Wash
-------------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-------------------------------
5. Elements to be Purchased:
[Recitals]
Assets : A Full Service Car Wash (General Description)
-------------------------------------
And all equipment at the location
--------------------------------------
Real Property: Fee Simple (General Description)
---------------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------------------
Stock: None (General Description)
------------------------------
___________________________
6. Trade Names & Trademarks
[Purchase and Sale of Assets]
Trade Names: Quaker Car Wash, Inc.
--------------------------------
D/B/A : ▇▇▇▇▇ Car Wash
--------------------------------
7. Purchase Price: Two Million Eight Hundred Fifty Thousand Dollars
----------------------------------------------------------------
($2,850,000.00)
---------------
[Amount of Purchase Price]
8. EBITDA - (subject to verification): To be supplied
[Amount of Purchase Price]
9. Effective Capitalization ("Cap") Rate: N/A [Amount of Purchase Price]
----------
10. Allocations: Covenant Not to Compete $ 5,000.00
--------------
Land: $ 645,000.00
--------------
Car Wash Equipment: $ 125,000.00
--------------
Building: $ 2,075,000.00
--------------
Estimated Inventory (not included in Purchase Price): $25,000.00
----------------
11. Hold-Back: $100,000.00
-----------
[Payment of Purchase Price & Commissions]
12. Hold-Back Period: Nine (9) months from the Close of Escrow
---------------------------------------------------
[Payment of Purchase Price & Commissions]
13. Hold-Back Depletion Amount: None
----------------
[Payment of Purchase Price & Commissions]
14. Guaranty Period [minimum period must equal Non-Compete Period]:
[Payment of Purchase Price & Commissions] Two (2) Years
--------------------------
15. Buyer's Broker: ▇▇▇ ▇▇▇▇▇▇▇ (Finder's Fee)
----------------------------------------------------
[Payment of Purchase Price & Commissions]
16. Seller's Broker: None
---------------------------------------------------
[Payment of Purchase Price & Commissions]
17. Title Company: ▇▇▇▇▇▇▇ Title or other Title Company as chosen by Buyer
-------------------------------------------------------
[Documents and Physical Inspection]
18. Escrow Company: Arizona Escrow, attn. ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
----------------------------------------------
[Escrow] ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
----------------------------------------------
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
----------------------------------------------
(▇▇▇)▇▇▇-▇▇▇▇; Fax: (▇▇▇) ▇▇▇-▇▇▇▇
----------------------------------------------
19. Escrow Opening Date:__________________________________________
[Escrow] (Date by which Escrow must be opened)
20. Initial Deposit:Ten Thousand Dollars ($10,000.00)
-------------------------------------
[Escrow]
21. Days From Opening: Forty Five (45) Days from Opening Escrow
--------------------------------------------
[Escrow] (Earliest Date On Which Buyer's Deposit Becomes Non-Refundable)
22. Fuel Companies: Texaco
------
[Escrow]
23. Consent Date: Execution of Agreement
------------------------------------
[Conditions Precedent to Closing]
24. Date for Close of Escrow: Seventy Five (75) Days from the Opening of Escrow
[Closing]
25. Non-Compete Area: Lubbock County, Texas
---------------------
Non-Compete Period: Two (2) Years
---------------------
[Non-Competition Agreements]
26. Seller's Address for Notices: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------
[Notices] Quaker Car Wash, Inc.
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
--------------------------------
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------
Buyer's Address for Notices: Millennia Car Wash LLC
[Notices] ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, General
Counsel
cc: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Senior General Counsel
Millennia Car Wash, LLC
27. Governing State Law: Texas
-------------------------------------------------
[Governing State Law]
28. County Jurisdiction: Lubbock
-------------------------------------------------
[Governing State Law]
The foregoing Basic Purchase Information ("BPI") forms a part of the standard
form CAR WASH ASSET PURCHASE/SALE AGREEMENT ("Agreement") and is incorporated by
reference into the Agreement pursuant to the operative provisions of the basic
text of the Agreement contained in the attached pages. The BPI shall control
over the text in the event of any conflict.
EXHIBIT LIST
------------
Exhibit "A" Furniture, Fixtures & Equipment; Leasehold Improvements; &
Specified Tangible Assets
Exhibit "B" Inventory - Definition & List. Definition: Items held for
resale, spare parts and supplies in raw forms (i.e.,
detergents, etc.), fuel.
Exhibit "C" Permits
Exhibit "D" Intangibles
Exhibit "E" Trade Names, Trademarks, DBAs, Logos (Documents)
Exhibit "F-1" Operating Leases (Seller is Lessee)
Exhibit "F-2" Seller's Leases (Seller is Lessor)
Exhibit "G" Seller's Fee Simple Interests in Real Property - Legal
Descriptions
Exhibit "H" Fuel Company Agreements
Exhibit "I" Zoning Certificate
Exhibit "J" Consent and Agreement of Spouse
Exhibit "K" Undischarged and Assumed Obligations
Exhibit "L" Service Contracts Exceeding 30 Days
Exhibit "M" ▇▇▇▇ of Sale (Form)
Exhibit "N-1" Non-Competition - Corporate
Exhibit "N-2" Non-Competition - Individual
Exhibit "O" Guaranty Agreement
ADDENDA
-------
The following Addenda are attached to and made a part of this Agreement (if
none, so state):
Additional Conditions of Purchase: None
Exceptions to Non-Competition: None
Corrections to Agreement:
1. Section I. B. (7), Seller and Principals, Line 1: Insert "entity or"
---------------------
before the word "individual."
2. Section III. B., Line 3: After the parenthetical "(operations and
Covenants)" insert the sentence: "The hold-back amount shall cover any
and all of Seller's liabilities or third party claims, which exist as
of the Close of Escrow, whether known or unknown, or which arise or
become known during the hold-back period specified in BPI Item 12."
3. Section IV. D, Line 1: Insert " , or the equivalent thereof, or a Land
Survey Category IA, as determined by Buyer," after the word "survey."
4. Section V. C. (2): Insert ", in its sole and absolute discretion,"
after "Buyer"
5. Section V. C. (3): Insert ", in its sole and absolute discretion,"
after "Buyer"
6. Section V. C.: Insert at the end thereof,
"At any time prior to Closing, Buyer has the right, in its sole
and absolute discretion, to review, analyze, and approve or
disapprove of Seller's books and records, including, but not
limited to, the accuracy thereof, and take into account the total
economic viability of the transaction as it relates to Buyer's
overall business plans."
7. Section VI. H. Seller's Retained Liabilities, Line 7: Delete
-----------------------------
"Effective Date of this Agreement" and insert "Close of Escrow."
8. Section VI. K. (3), Lines 2 through 5: Delete:
"If such a letter is not received by Seller, or its agent, on or
before the time specified in Section V. B., Buyer shall be deemed
to have rejected one or more of the Inspection Items, and this
Agreement shall terminate in its entirety and become null and
void"
Substitute in lieu thereof:
"If such letter is not received by Seller, or its agent, on or
before the time specified in Section V. C., Seller has the right
to demand such a letter from Buyer. Buyer shall deliver such
letter to Seller within five (5) days of Buyer's receipt of
notice of Seller's demand. If Buyer fails to deliver such an
approval or disapproval letter, Buyer shall be
deemed to have rejected one or more of the Inspection Items,
and this Agreement shall terminate in its entirety and become
null and void."
9. Section IX. A., Line 1: Delete "to the extent covered by Insurance,".
10. Section XI. B. (2), Line 1: Insert ", or equivalent thereof," after
the parenthetical "(extended form)."
11. Section XI. B. (2), Line 1: Insert "and Seller's Improvements" after
the word "Land."
12. Section XI. B. (2), Line 3: Insert "and the Improvements thereon"
after the word "Land."
13. Section XI. B. (2), Add at the end thereof, "To the extent that the
amendments and endorsements referenced in the first full paragraph
hereof are not available, it shall be within Buyer's sole and absolute
discretion to determine what it will accept in lieu thereof. To the
extent Title Company coverage is not available as specified in the
endorsements shown above, the following shall apply:
100 Buyer must approve any restrictions shown, or otherwise satisfy
itself as to these assurances against loss resulting from
violations of the REA.
116.4 Buyer must be satisfied that each of the parcels of land
described in the policy and the REA are contiguous parcels, if
applicable.
103.6 Buyer shall satisfy itself pursuant to the as-built survey, or
otherwise that the improvements on each of Seller's Lands do
not encroach onto any easement.
103.7 Buyer must be satisfied that Seller's Lands abut on and have
access to a physically open street.
116.1 Buyer must be satisfied that the property described in the
policy is the same property as shown on the survey.
14. Section XI. E. Line 4: Insert "Seller's" before the word "Broker's."
15. Section XII, Lines 4 through 6: Delete:
"In the event Buyer fails to notify Seller of Buyer's
disapproval of the Phase I's or Phase II's within the time
period set forth in Section V. B., Buyer shall be deemed to
have rejected the Phase I's and/or Phase II's as not
satisfactory."
Substitute in lieu thereof:
"If such letter is not received by Seller, or its agent, on or
before the time specified in Section V. C., Seller has the
right to
demand such a letter from Buyer. Buyer shall deliver such
letter to Seller within five (5) days of Buyer's receipt of
notice of Seller's demand. If Buyer fails to deliver such an
approval or disapproval letter, Buyer shall be deemed to have
rejected one or more of the Inspection Items."
16. Section XXIV, Add at the end thereto: "The parties acknowledge that
the Agreement has been executed prior to the completion of certain
Exhibits which are solely the responsibility of Seller to prepare and
subject to Buyer's sole approval (specifically, Exhibits A-H and K-M).
The parties further agree that said Exhibits shall be attached to the
Agreement as soon as possible, but in all cases, prior to the
Closing."
17. Except as shown above, there are no other corrections to the
Agreement.
