EXHIBIT 2.3.1
CONTRACT FOR SALE
AGREEMENT made this 10th day of April, 1997, between XXXX XXXXXX XXXX,
INC. ("Seller") and XXXXXX ACQUISITIONS, INC., or its assigns ("Buyer").
The parties have reached an understanding with respect to the sale and
purchase of Forty-Nine Percent (49%) the outstanding Class B partnership
interests (the "Partnership Interests") of a Florida limited partnership to be
formed by Seller (the "Partnership") engaged in the operation of a Ford
dealership in Manatee County, Florida (the "Seller") and the obligations of
Seller and Buyer in connection therewith.
IT IS THEREFORE AGREED:
1. PURCHASE PRICE. The Seller agrees to sell and the Buyer agrees to
buy, forty-nine percent (49%) of the Class B limited partnership interests of
the Partnership (the "Partnership Interests") and as consideration therefor to
pay Four Million Six Hundred Fifty-Five Thousand and No/100 Dollars
($4,655,000.00) subject to adjustment as provided below in Section 3, to be paid
in cash, by cashiers' check made payable to the order of Seller or wire transfer
to the account of Seller at closing.
2. XXXXXXX MONEY. Buyer has paid herewith to Xxxxxx & Xxxxx, L.L.P, as
Escrow Agent, xxxxxxx money in the sum of Twenty-Five Thousand Dollars
($25,000.00) in connection with the transaction contemplated hereby. The xxxxxxx
money shall be invested in a non-interest bearing account pending its
disposition in accordance with the terms of this Agreement.
3. CONDITIONS. This purchase price for the Partnership Interests set
forth in Section 1 above is based on the net worth of the Partnership, which
Seller represents to the Buyer will be Two Million Five Hundred Twenty-Nine
Thousand, Six Hundred Eighty-Three and No/100 Dollars ($2,529,683.00) after
contribution of the assets of the Seller contemplated pursuant to Section 6 of
this Agreement. The Buyer may cause to be taken a physical inventory of the
assets of the Partnership prior to Closing and Buyer and Seller shall arrive at
a balance sheet as of the date of Closing, including the assets and liabilities
transferred to the Partnership (but excluding the contribution to be made by the
General Partner and to be adjusted further by excluding balance sheet accounts
numbered 1700-1705, 1710, 1715, 2500 and 2510) (the "Closing Date Balance
Sheet"). The purchase price shall be adjusted upwards by fifty percent (50%) of
the amount by which the net worth of the Partnership as determined in the
Closing Date Balance Sheet is greater than Two Million Five Hundred Twenty-Nine
Thousand, Six Hundred Eighty-Three and No/100 Dollars ($2,529,683.00) and
adjusted downwards by fifty percent (50%) of the amount by which the net worth
of the Partnership as determined in the Closing Date Balance Sheet is less than
Two Million
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Five Hundred Twenty-Nine Thousand, Six Hundred Eighty-Three and No/100 Dollars
($2,529,683.00).
In determining the net worth of the Partnership, Generally Accepted
Accounting Principles, consistently applied shall be utilized by Buyer and
Seller. In the event the Buyer and Seller cannot agree on the Closing Date
Balance Sheet, they shall each choose a certified public accountant to whom they
shall submit the items in dispute for a determination by said accountant(s)
which shall be binding on Seller and Buyer. For purposes of this Agreement the
following methods of valuation shall be deemed to be in accordance with
Generally Accepted Accounting Principles for the purpose of determining the
correctness of the Closing Date Balance Sheet:
(a) PARTS, ACCESSORIES, AND MISCELLANEOUS SUPPLIES.
(i) Buyer shall value all the new, genuine, original,
unopened, current and unused Ford factory parts and accessories which
could be returned to the manufacturer by the Partnership for the price
as defined in subparagraph (A) below. Buyer shall not be required to
include in the valuation damaged or obsolete parts. Buyer may also, at
its option, include in the valuation Seller's miscellaneous service
supplies and inventories at Seller's cost of such items. Said items
shall appear on an inventory list prepared by Buyer and Seller near the
Closing date. The inventory list is to be incorporated herein and made
a part hereof the same as if fully set forth herein and designated as
SCHEDULE "1".
(A) Buyer and Seller shall determine the
value for the parts referenced in paragraph (i) above, per an
inventory at prices which shall be determined by the most
current Manufacturer's Parts Catalog Price. Buyer may include
in the valuation any parts and inventories not required to be
purchased by paragraph 1 as shall be determined by good faith
negotiations between Buyer and Seller. Seller agrees that no
additions or deletions shall be made in such stocks except in
the ordinary course of business, and further, to keep adequate
records of such additions and deletions, which records shall
be made available to Buyer for review and verification upon
reasonable request. Buyer and Seller shall each pay for
one-half (1/2) of the cost of the inventory if an independent
inventory service is engaged by the parties.
(ii) NEW VEHICLES.
(A) The 1997 and later years new and
warrantable Ford vehicle inventory will be valued at a price
equal to the sum of Seller's original factory invoice cost
plus the cost of dealer installed items and less any rebates,
holdbacks (including supplemental holdback or year end
carryover allowances), incentive payments (including finance
incentives and advertising allowances) given Seller by the
manufacturer for any reason with respect to these vehicles or
pre-delivery inspection credits received if the work is not
performed as of Closing.
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For the purpose of the foregoing provisions, the cost of
dealer installed items shall be equal to the Seller's actual
cost of the installed item plus labor charges for installation
computed at a mutually agreed upon xxxx-up from Seller's
sub-let and internal costs, but in no event greater than the
charge customarily placed on Seller's vehicle inventory
records.
(B) It is further agreed that in the event
any vehicles referred to in this paragraph shall have been
damaged prior to the Closing, Seller shall have repaired such
vehicle to the satisfaction of Buyer, or in the event any such
vehicles have not been repaired, Seller and Buyer shall agree
on the cost to recover such repairs, which cost shall be
deducted from the price referred to herein. In the event
Seller and Buyer cannot agree on the cost of repairs, Buyer
shall have no obligation to include in the valuation any such
vehicle or vehicles and Seller shall retain title to such
specific vehicles. Further, Buyer may include in the valuation
in connection with the determination of the purchase price,
1996 new Ford and any warrantable demonstrator Ford vehicles
at such actual cash price for each vehicle as shall be
determined by good faith negotiations between Buyer and
Seller. In the event of a failure to agree on vehicle prices,
Buyer may elect not to include in the valuation such specific
vehicles, in which case Seller shall retain title to such
specific vehicles. Any new vehicle with over 200 miles on the
odometer shall be considered a demonstrator vehicle. The new
and demonstrator automobiles to be purchased pursuant to this
section shall be listed in SCHEDULE "2"-NEW AND DEMONSTRATOR
INVENTORY to be prepared by Seller and Buyer prior to the
Closing and initialed by them at the Closing. Said Exhibit
shall show the purchase price of each vehicle computed as set
forth above.
(iii) USED VEHICLES. Buyer may include in the
valuation Seller's used vehicle inventory as of the Closing at such
actual cash wholesale value for each vehicle as shall be determined by
good faith negotiations between Buyer and Seller. In the event of a
failure to agree on vehicle prices, Buyer may elect not to include in
the valuation all or any of such vehicles, in which case, Seller shall
retain title to such vehicles as Buyer elects not to so include. The
used automobiles to be purchased pursuant to this section shall be
listed in SCHEDULE "3"-USED VEHICLES PURCHASED to be prepared by Seller
and Buyer prior to the Closing and initialed by them at the Closing.
Said Exhibit shall show the agreed valuation price of each vehicle.
4. EXAMINATION OF RECORDS. After the execution of this Agreement,
Seller will allow the Buyer, its counsel and other representatives full access
during normal business hours, or such other reasonable times, to all the books,
tax returns, both federal, state and local, records, files, documents, assets,
properties, contracts and agreements of Seller and Seller and shall furnish the
Buyer, its officers and representatives with all information concerning the
affairs of such companies which may be reasonably requested. The Buyer agrees
that it will use its best efforts to prevent its review of the foregoing
materials from causing any disruption of the business of the Seller. The Buyer
shall exercise its general rights under this provision to ascertain that the
business is generally as
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represented by the financial statement dated December 31, 1996. The Buyer may,
on or before thirty (30) days from the date of this Agreement, cancel this
Agreement if the results of the Buyer's investigation reveal material
discrepancies from that represented in the financial statements and the xxxxxxx
money paid herewith shall be returned to the Buyer.
5. FAILURE TO CONSUMMATE SALE. In the event the Buyer fails to
consummate the purchase of the Partnership Interests from the Seller for any
reason except that described in Paragraph 4 or the failure of a condition
precedent as set forth in Paragraph 11, the xxxxxxx money paid this date shall
be forfeited and shall be retained by the Seller as liquidated damages. In the
event the Seller fails to consummate the sale of the Partnership Interests or
transfer of its assets to the Partnership for any reason except the default of
Buyer under this Agreement, the Buyer may require specific performance of this
Agreement by the Seller in any court of competent jurisdiction, in addition to
any other rights or remedies which Buyer may have at law or in equity.
6. FORMATION OF PARTNERSHIP. Prior to the Closing the Seller shall
contribute all of the assets (including intangibles) of Seller, subject to
liabilities set forth on the Closing Date Balance Sheet to the Partnership in
exchange for all of the limited partnership interests representing ninety-nine
percent (99%) of the total partnership interests (the "Partnership Interests").
The general partner of the Partnership shall be First Team Management, Inc.
which shall own one percent (1%) of the total Partnership Interests in exchange
for the payment of Ninety-Five Thousand and No/100 Dollars ($95,000.00) subject
to adjustment proportionately with the purchase price of the assets being sold
hereunder together with an amount representing one percent (1%) of the value as
finally determined of the Class A Partnership Interests. The Partnership shall
be formed in accordance with the provisions of the Partnership Agreement
attached hereto as EXHIBIT "A".
7. CLOSING. The closing of the sale shall take place at the offices of
Xxxxxx & Xxxxx, L.L.P., 00 Xxxxx Xxxxxx Xxx., Xxxxx 0000; Xxxxxxx, Xxxxxxx
00000, or such other place mutually agreed by the parties on or before ninety
(90) days after the date of execution hereof, unless extended by the mutual
agreement of Buyer and Seller. At the Closing, Seller shall deliver to the
Buyer, free and clear of all liens, encumbrances and restrictions, an assignment
of the Partnership Interests, an updated title commitment reflecting no changes
from that provided in Paragraph 11 below, the Seller's resignation as Ford
Dealer-Operators and such other documents as required by this Agreement. Upon
such delivery, the Buyer shall deliver to the Seller, a certified or cashier's
check payable to the order of the Seller or a wire transfer of funds fully
completed to an account and bank as directed by the Seller for the total
purchase price, less the amount of the xxxxxxx money, together with interest
thereon, previously paid hereunder, and subject to any adjustments as provided
in Paragraph 3.
8. REPRESENTATIONS AND WARRANTIES. The Seller represents and warrants
as follows:
(a) ORGANIZATION AND STANDING OF SELLER. The Seller is duly
organized, validly existing and in good standing under the laws of the State of
Florida. Copies of the Seller's Articles of Incorporation and all amendments
thereof to date, certified by the Secretary of State of Florida,
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and of the Seller's Bylaws as amended to date, certified by the Seller's
Secretary, shall be delivered to the Buyer, and are complete and correct as of
the date of this Agreement.
(b) OWNERSHIP. Seller represents and warrants that it is the
owner, free and clear of any liens, restrictions, encumbrances or rights of
others, of all of the Partnership Interests. Seller has full right and authority
to transfer said Partnership Interests to the Buyer. Xxxx X. Xxxxxx, Xx., Xxxxxx
Xxxxxx and Xxxxxx X. Xxxxxx each are or will be the owners of one hundred
percent (100%) of the outstanding capital stock of the Seller, and there are no
other shares of the Seller owned or claimed by any other person or entity.
(c) FINANCIAL STATEMENTS. Seller has delivered to Buyer a copy
of the financial statements for the Seller as of December 31, 1996, a copy of
which is attached as EXHIBIT "B" which present a true and complete statement of
the Seller's condition as of that date and an accurate representation of the
results of the Seller's operations for the period indicated and an accurate and
complete list of the Seller's assets, fixed or otherwise. The financial
statements have been prepared in accordance with Generally Accepted Accounting
Principles consistently applied, and which are to be consistently applied
through and including the Closing, except as set forth on EXHIBIT "B-1". All
other assets so listed are correct and will remain so until Closing, except as
might be affected by normal business operations of the Seller.
(d) ABSENCE OF UNDISCLOSED LIABILITIES. Except to the extent
reflected or reserved against in the December 31, 1996 financial statement, the
Seller had no material liabilities of any nature, whether accrued, absolute,
contingent, or otherwise, including tax liabilities due or to become due and
arising out of transactions entered into or any state of facts existing prior
thereto. Seller warrants that there are no material liabilities of any nature or
any material amount not fully reflected or reserved against in said statement.
Further, all liabilities of the Seller shall be current as of the date of
Closing and reserved for in the Closing Date Balance Sheet. For purposes of this
Agreement, the term material shall refer to any individual liability of $500.00
or more, or aggregate liabilities of the Seller in excess of $10,000.00 or more.
(e) ABSENCE OF CERTAIN CHANGES. Except as set forth in EXHIBIT
"C", from December 31, 1996 and continuing through the date of Closing, the
Seller further represents that there has not been (i) any material change in the
Seller's financial condition, assets, liabilities or business, other than
changes in the ordinary course of business, none of which have been materially
adverse; (ii) any material damage, destruction or loss, whether or not covered
by insurance, materially and adversely affecting the Seller's properties or
business; (iii) any declaration, or setting aside, or payment of any dividend or
other distribution in respect to the Seller's shares, or any direct or indirect
redemption, purchase or other acquisition of any such shares; or (iv) any labor
strike of the Seller by its employees, or any event or condition of any
character, materially and adversely affecting the Seller's business or
prospects.
(f) TITLE TO PROPERTIES. The Seller has good and marketable
title to all of its properties and assets, real and personal, including those
reflected in the balance sheet of December 31, 1996 [except those sold or
otherwise disposed of in the ordinary course of business], subject to
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no security interests, mortgage, pledge, lien, encumbrance or charge, except for
liens shown on the Balance Sheet as securing specified liabilities set forth
therein (with respect to which no default exists).
(g) CONDITION OF EQUIPMENT. All of Seller's equipment is in
good operating condition and repair as of the date hereof and shall be as of the
date of Closing, shall be in conformity with all applicable ordinances and
regulations, and environmental, building, zoning, occupational safety and other
laws, provided Seller makes no warranty with respect to such equipment's
condition after Closing. Buyer shall have the right at any time prior to Closing
to inspect such equipment and ascertain its condition. Such equipment is all the
equipment necessary for the operation of the Seller's business in accordance
with Ford Motor Company dealer guidelines, and all equipment currently used in
the Seller's business is owned by Seller.
(h) ACCOUNTS RECEIVABLE. Seller shall deliver to Buyer a true
and complete list, certified by Seller, of the Seller's accounts receivable
within ten (10) days of the date of this Agreement. Following the Closing, if
any of such accounts receivable, or any accounts receivable arising between the
date of such listing and the Closing are not paid in full on or before 90 days
after their due date, Seller shall reimburse the Partnership for all such
uncollected receivables in excess of the debt reserve, set forth on the Closing
Date Balance Sheet.
Partnership shall cause diligent effort to be made to collect
all such receivables, including where necessary, filing of appropriate notices
and liens under applicable Florida and federal law. Partnership shall, at
Seller's request, periodically furnish Seller with a schedule of unpaid accounts
receivable more than ninety (90) days past due, setting forth each debtor's
name, address and account balance, and shall furnish, at Seller's request, a
schedule setting forth the action being taken to collect any such accounts
receivable. Collection procedures and any costs thereof to be borne by the
Partnership and deducted from any proceeds, shall be agreed upon by Buyer and
Seller prior to any litigation or Buyer shall not be obligated to undertake any
such actions. Upon payment by Seller as aforesaid, Buyer shall cause such
accounts to be assigned to Seller.
(i) INTENTIONALLY DELETED.
(j) WORKING CAPITAL. The Seller and the Partnership (after
contribution of the assets to the Partnership) shall have sufficient Working
Capital, as defined by Ford Motor Company, on the date of this Agreement and
continuing through the date of Closing, to meet the recommended requirements.
This provision shall not be construed to prevent Seller from distributing cash
in excess of the required working capital to its shareholders.
(k) REAL PROPERTY; HAZARDOUS WASTE. Except as disclosed on
EXHIBIT "D", there are no pollutants, contaminants, petroleum products or
by-products, asbestos or other substances, whether hazardous or not, on or
beneath the surface of any of the Seller's property including leasehold estates,
which Seller, or any other person or entity has placed, caused or allowed to be
placed upon the Seller's property, and which have caused or may cause any
investigation by any
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agency or instrumentality of government, which are or may be on the Seller's
property in violation of any law or regulation of any local, state or federal
government or which are or may be a nuisance or health threat to occupants of
the Seller's property or other residents of the area and no person, firm or
other legal entity has any right or option whatsoever to acquire the property or
any portion or portions thereof or any interest or interests therein.
(l) CONTRACTS. The Seller has no contract or commitment
extending beyond April 1, 1996, or involving payment by the Seller of more than
$1,000.00 in the aggregate, except those listed on the attached EXHIBIT "E"
which is made a part hereof. True and complete copies of all listed contracts
have been delivered to the Buyer. The Seller has complied with all the
provisions of all such contracts and commitments to which it is a party, and is
not in default under any of them nor will the execution of this Agreement result
in a default under any of such contracts.
(m) TAX RETURNS. Both now and up to and including the Closing,
the Seller has paid all due and payable income, social security, withholding,
sales, use, unemployment insurance and other taxes to all city, state and
federal governments, and have paid all due and payable premiums in satisfaction
of their statutory obligations for workers' compensation insurance coverage. The
Seller has duly filed all federal, state and other tax returns required to be
filed. All taxes, assessments and other governmental charges at any time known
by the Seller to be due from or upon the Seller or any of its income, property
or assets have been duly paid, and no extensions for the time of payment have
been requested. The Seller has paid, or set upon its books, accruals or reserves
adequate for the payment of all federal, state and other income, franchise and
other tax liabilities relating to any actions taken by Seller through the date
of Closing. Seller hereby warrants and indemnifies Buyer or Partnership as to
any future tax deficiencies, penalties and interest of Seller not otherwise
reserved for, relating to any transaction or event taking place prior to the
Closing.
(n) DIRECTOR AND OFFICERS; COMPENSATION; BANKS. The Seller
shall deliver to the Buyer within ten (10) days of the date of this Agreement a
true and complete list, as of the date of this Agreement, certified by the
Seller's treasurer, showing: (i) the names of all the Seller's directors and
officers; (ii) the names and title of all persons whose are employed by the
Seller together with a statement of the full amount presently paid or payable to
each such person for services rendered; (iii) the name of each bank in which the
Seller has an account or safe deposit box, and the names of all persons
authorized to draw thereon, or to have access thereto; and (iv) the names of all
persons holding powers of attorney from the Seller and a summary statement of
the terms thereof.
(o) LITIGATION. Except as disclosed on EXHIBIT "F" for suits
of a character incident to the normal conduct of the Seller's business and
involving not more than $2,500.00 in the aggregate, there is no litigation or
proceeding pending, or to the Seller's knowledge threatened, against or relating
to the Seller, its properties or business, nor does the Seller know or have
reasonable grounds to know of any basis for any such action, or of any
governmental investigation relative to the Seller, its properties or business.
(p) LEASE, CONTRACTS AND LICENSES. Seller represents and
warrants that the transfer of the Partnership Interests in accordance with the
terms of this Agreement will not constitute a
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prohibited assignment or transfer of any of the licenses, leases or contracts of
the Seller, and that all of the foregoing will remain in full force and effect
without acceleration as a result of this transaction. However, it is
acknowledged that Ford Motor Company is required to acknowledge the Partnership
as an acceptable owner together with its partners, both general and limited.
(q) DISCLOSURE. No representation or warranty by the Seller in
this Agreement, nor any statement or certificate furnished or to be furnished to
the Buyer pursuant hereto, or in connection with the transactions contemplated
hereby, contains or will contain any untrue statement of a material fact, or
omits or will omit to state a material fact necessary to make the statements
contained herein or therein not misleading.
(r) LABOR MATTERS. Within the last three (3) years, Seller has
not been the subject of any union activity or labor dispute, nor has there been
any strike of any kind called, or threatened to be called against Seller and,
Seller has not violated any applicable federal or state law or regulation
relating to labor or labor practices, and is not a party to any collective
bargaining agreement.
(s) PROFIT SHARING AND BENEFIT PLANS. Except as disclosed on
EXHIBIT "G", there are no employee benefit plans and agreements maintained by
Seller for the benefit of its shareholders, officers, directors or employees.
There are no contributions or payments due with respect to such plans or
agreements, nor will any such contributions or payments be due or required to be
paid on or prior to the Closing Date. Seller is in compliance in all respects
with the presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). No event which constitutes a
reportable event as defined in Section 4043 of ERISA has occurred and is
continuing with respect to any plan covered by ERISA. There would be no
liability of any of Seller under Subtitle D of Title IV of ERISA if any plan
were terminated as of the Closing Date and Seller has not incurred any
withdrawal liability to any multi-employer plan and does not have any contingent
withdrawal liability to any multi-employer plan under ERISA, as amended by the
Multi-employer Pension Plan Amendments Act of 1980.
(t) DEALER AGREEMENT. No default presently exists under the
Seller's Dealer Agreement with Ford Motor Company and Seller is in good standing
under such Dealer Agreement. Seller has no knowledge of a change in Ford Motor
Company marketing strategy in its area (except the proposed relocation of
Seller) or the granting of any additional Ford dealership points, which are not
already open and operating, within a twenty (20) mile radius of Manatee County,
Florida.
(u) GUARANTEES. Seller is not a guarantor, surety, endorser or
accommodation party for any third party, or otherwise obligated for the debt of
any person except as reflected in the December 31, 1996 Financial Statements.
(v) CHARGE-BACKS. Any charge-backs or claims on credit life,
disability, finance reserve or extended warranty policies sold by Seller or any
affiliated entity prior to the Closing Date shall be the liability of the
Partnership and the Partnership shall pay same. The Seller represents that all
of such policies and contracts have been entered into in the ordinary course of
business on terms
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consistent with those prevailing in the industry and in accordance with
regulatory requirements. Buyer and Seller both agree not to cause the bulk
termination of any of such policies sold by Seller to its customers.
9. CONDUCT OF BUSINESS PENDING CLOSING. The Seller covenants
that, pending the closing:
(a) The Seller's business will be conducted only in the
ordinary course and there shall be no acceleration of payment of any contract or
change in rate of compensation payable to any employee in the form of a bonus or
otherwise, other than commitments previously disclosed to Buyer in writing.
(b) No change will be made in the Seller's Articles of
Incorporation or Bylaws, except as may be first approved in writing by the
Buyer.
(c) No change will be made in the Seller's authorized or
issued corporate shares.
(d) No contract or commitment will be entered into by or on
behalf of the Seller, except normal commitments for the purchase of inventory,
parts and supplies, without the Buyer's written approval.
(e) No change will be made affecting the personnel, or banking
or safe deposit arrangements of the Seller without the Buyer's written approval.
(f) Except as otherwise requested by the Buyer, the Seller
will cause the Seller to use its best efforts (without making any commitment on
the Buyer's behalf) to preserve the Seller's business organization intact; to
keep available to the Seller the services of its present employees; and to
preserve for the Seller the goodwill of its suppliers, customers, and others
having business relations with the Seller.
(g) All debts will be paid as they become due.
(h) No contract right of the Seller will be waived without
Buyer's written approval.
(i) No uninsured material physical damage for loss will occur
to the assets of the Seller.
(j) No obligations except current liabilities under contracts
entered into the ordinary course of business will be incurred without Buyer's
written approval.
(k) The Seller will not suffer any strike or labor dispute.
10. SELLER PERSONNEL. The Buyer (or the Partnership) shall have no
obligation to employ Seller's personnel after the Closing.
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11. CONDITIONS PRECEDENT. All obligations of the Buyer under this
Agreement, are, at its option, subject to the fulfillment, prior to or at the
closing, of each of the following conditions:
(a) FORD MOTOR COMPANY APPROVAL. Approval of the transaction
by Ford Division of Ford Motor Company of the Buyer or its designee as the
Dealer/Operator.
(b) FINANCING. Partnership shall have obtained floor-plan
financing in an amount sufficient to permit the Partnership to operate a Ford
Dealership on terms as may be prevailing at the time of Closing and conditions
as may be satisfactory to Buyer. Buyer shall use reasonable efforts to cause the
Partnership to obtain such financing.
(c) AGREEMENT. Buyer shall have closed on the transaction
contemplated by the Agreement For Purchase and Sale of Class A Partnership
Interests between the parties dated as of even date herewith.
(d) PARTNERSHIP FORMATION. Seller shall have completed the
transfer of the Assets of Seller to the Partnership in form acceptable to Buyer.
(e) XXXX-XXXXX-XXXXXX ANTITRUST ACT. All applicable waiting
periods related to the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 0000 (xxx
"XXX" Xxx") shall have expired.
(f) REPRESENTATIONS AND WARRANTIES TRUE AT CLOSING. The
Seller's representations and warranties contained in this Agreement shall be
true at the time of closing.
(g) PERFORMANCE. The Seller shall have performed and complied
with all agreements and conditions required by this Agreement to be performed or
complied with by them prior to or at the Closing.
(h) OFFICER'S CERTIFICATE. The Seller has delivered to the
Buyer a certificate of the Seller's president and treasurer, certified by the
Seller's secretary, dated the closing date, certifying to the fulfillment of the
conditions specified in subparagraphs (b) and (c) of this paragraph.
(i) OPINION OF SELLER'S COUNSEL. The Seller shall have
delivered to the Buyer an opinion of the Seller's counsel, Xxxxxx X. Xxxxxxx,
Esq., of Trinkle, Redman, Xxxxxxx, Xxxx & Coton, P.A., P. X. Xxxxxx XX, Xxxxx
Xxxx, Xxxxxxx 00000, dated the closing date, that the Seller's corporate
existence, good standing, and authorized and issued stock are as stated in
subparagraphs (a) and (b) of paragraph 8; that the Seller has good and
marketable title to all its property and assets as set forth in subparagraph (i)
of paragraph 8; and that, except as may be specified by such counsel, they do
not know or have any reasonable grounds to know of any litigation, proceeding,
or governmental investigation pending or threatened against, or relating to, the
Seller, its properties, or business.
(j) HAZARDOUS WASTE INSPECTION. As of the date of full
execution hereof, Buyer shall have requested a hazardous waste report (the
"Report") from a registered environmental
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engineer to be delivered to Buyer. If the Report discloses that the property
subject to the Lease or underlying ground water is contaminated with any
hazardous or toxic substances, wastes, materials, pollutants or contaminants,
Buyer shall have the right to terminate this Agreement and receive a refund of
the Deposit. In the event that Buyer elects to terminate this Agreement, said
election to terminate shall be of no force and effect if Seller, within seven
(7) days of receipt of Buyer's termination notice, notifies Buyer that it shall
remove the hazardous substances from the said property at its sole cost and
expense. If Seller elects to remove the hazardous substances it shall be
obligated to remove the hazardous substances from the contaminated area in
accordance with applicable statutes, rules, ordinances and regulations which
govern clean up of hazardous substances. In the event of an election by Seller
to clean up the Property, Seller must provide Buyer with a certificate from a
registered environmental engineer which states that any and all substances which
have contaminated the Property or the underlying ground water have been removed
in accordance with all applicable regulations. Purchaser acknowledges receipt
from Seller of certain environmental reports with respect to the Dealership.
12. INDEMNIFICATION. The Seller shall indemnify and hold harmless the
Partnership and the Buyer, at all times after the date of this Agreement,
against and in respect of:
(a) UNDISCLOSED LIABILITIES. All material liabilities of the
Seller of any nature, whether accrued, absolute, contingent, or otherwise,
existing at Closing or thereafter arising out of facts or transactions existing
or taking place prior to Closing, to the extent not reflected or reserved
against in full in the Seller's Closing Date Balance Sheet, including, without
limitation, any tax liabilities to the extent not so reflected or reserved
against, accrued in respect of, or measured by the Seller's income for any
period prior to Closing, or arising out of transactions entered into, or any
state of facts existing, prior to such date;
(b) INTERIM LIABILITIES. All material liabilities of, or
claims against, the Seller arising out of the conduct of the Seller's business
between December 31, 1996 and the Closing otherwise than in ordinary course, or
arising out of any presently existing contract or commitment of the character
described in subparagraph (L) of paragraph 8 and not listed therein, or arising
out of any contract or commitment entered into or made by the Seller between the
date hereof and the Closing except as permitted by the provisions of
subparagraph (E) of paragraph 8 and not reflected on the Closing Date Balance
Sheet;
(c) MISREPRESENTATION. Any damage or deficiency resulting from
any misrepresentation, breach of warranty, or nonfulfillment of any agreement on
the part of the Seller under this Agreement, or from any misrepresentation in or
omission from any certificate or other instrument furnished or to be furnished
to the Buyer hereunder; and
(d) INCIDENTAL EXPENSES. All actions, suits, proceedings,
demands, assessments, judgment, costs, attorneys' fees (including appellate and
bankruptcy proceedings), and expenses incident to any of the foregoing.
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The Seller shall reimburse the Partnership or the Buyer, on
demand for any payment made or required to be made by the Partnership or the
Buyer at any time after Closing, in respect of any liability or claim to which
the foregoing indemnity relates.
(e) In the event of any damages arising from any of the
aforesaid matters, and as part of the indemnification, Buyer may set off against
any amounts owed by Buyer to Seller any damages sustained by it. In the event
said damages exceed such sums, Seller shall pay directly to Buyer the difference
between the damages sustained and the unpaid balance.
(f) In the event of Buyer becoming aware of facts which could
give rise to a claim entitling Buyer to set-off, before Buyer exercises this
right of set-off the Buyer must first:
(i) Notify Seller promptly upon the receipt by Buyer
of a written statement of facts that, if not corrected, would in its
judgment constitute a breach in this Agreement.
(ii) Upon the occurrence of an event which could give
rise to the Buyer making a claim for set-off, the Seller shall within
thirty (30) days (unless a shorter period is required to prevent Buyer
from suffering damage, loss or liability) after the receipt of written
notice from Buyer, (i) satisfy or take steps that will satisfy such
obligations, and pay such amount, or make adequate (in the reasonable
opinion of Buyer) provisions to reimburse Buyer for any loss incurred
or that may be incurred by Buyer as a result of the damages or (ii)
notify Buyer that it denies or disputes the alleged occurrence of such
damages giving rise to the claim for set-off asserted in the notice. If
within such thirty (30) day period Seller has, with respect to Buyer's
claim for set-off, failed to take the action required to be taken,
Buyer has the right, but not the duty to satisfy all or part of any
obligation with respect to such damages in the manner that in its sole
reasonable judgment is proper, and thereupon will be entitled to a
set-off against sums due to Seller from Buyer.
(iii) If Seller intends to defend a claim Seller
shall defend same at its own expense. Seller shall assume defense of
the claim unless Buyer reasonably objects because it has legal defenses
that Seller would not have. Seller may, at its own expense, defend the
claim in Buyer's name with their own counsel if they give notice of
their intention to do so within thirty (30) days of receiving notice of
the claim from Buyer. Buyer may participate in any action conducted by
Seller.
(iv) Regardless of whether either Seller or Buyer
choose to defend or participate in the defense of a claim, each shall
cooperate upon the other's reasonable request in the other's defense of
the claim. Such cooperation shall include furnishing records,
information and testimony and attending conferences, discovery
proceedings, hearings, trials and appeals, provided that the attendance
and participation of Buyer in such process shall be at Seller's sole
cost and expense if requested by Seller.
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(v) Unless Seller has failed to perform its
obligations under subparagraph (ii) of this Section, Buyer shall not
settle any claim for which it will claim a right of set-off from Seller
without Seller's consent, which shall not be unreasonably withheld.
Buyer shall notify Seller of any firm settlement offer for any such
claim. If Seller desires to accept the offer, it shall tender the
amount of the settlement together with all other amounts due.
(g) In the event that all payables of Buyer to Seller have been paid
and the factory conducts any warranty or other type audit resulting in factory
charge backs relating to Seller's operation of the Business, then Seller shall
pay or reimburse Buyer for the amount of such charge backs subject to Seller's
opportunity to review and have same justified.
13. HSR ACT FILINGS. To the extent such filings have not been completed
prior to the execution of this Agreement, each party shall, in cooperation with
the other parties, file or cause to be filed any reports or notifications that
may be required to be filed by it under the HSR Act, with the Federal Trade
Commission and the Antitrust Division of the Department of Justice, and shall
furnish to the others all such information in its possession as may be necessary
for the completion of the reports or notifications to be filed by the other.
Prior to making any communication, written or oral, with the Federal Trade
Commission, the Antitrust Division of the Federal Department of Justice or any
other governmental agency or authority or members of their respective staffs
with respect to this Agreement or the transactions contemplated hereby, the
Seller shall consult with Buyer. Filing fees shall be paid by Buyer.
14. BROKERAGE. The Seller and Buyer each represent and warrant to the
other that all negotiations relative to this Agreement have been carried on by
them directly with each other, without the intervention of any person, and each
party shall indemnify the other and hold it harmless against and in respect of
any claim for brokerage or other commissions relative to this Agreement,
or to the transactions contemplated hereby, and also in respect of all expenses
of any character incurred by such party in connection with this Agreement or
such transactions.
15. NON-COMPETITION AGREEMENT AND CONSULTING CONTRACT. The Buyer
recognizes that the Seller, Xxxxxx Xxxxxx, Xxxx X. Xxxxxx, Xx. and Xxxxxx X.
Xxxxxx, through their tenure as owner and operator of the Seller and other
dealerships has developed a valuable expertise in all phases of new automobile
sales, service and financing, particularly in the Manatee County area. An
agreement not to compete (a non-competition agreement) shall be executed by the
Seller, Xxxxxx Xxxxxx, Xxxx X. Xxxxxx, Xx. and Xxxxxx X. Xxxxxx, providing that
Seller, Xxxxxx Xxxxxx, Xxxx X. Xxxxxx, Xx. and Xxxxxx X. Xxxxxx shall not
compete within a radius of fifty (50) miles of Manatee County for a period of
three (3) years from the date of Closing. The non-competition agreement shall be
in the form acceptable to Seller and Buyer to be attached hereto as EXHIBIT "H."
16. NATURE AND SURVIVAL OF REPRESENTATIONS. All statements contained in
any certificate or other instrument delivered by or on behalf of the Seller
pursuant hereto, or in connection with the transactions contemplated hereby,
shall be deemed representations and warranties by the Seller hereunder. All
representations, warranties, and agreements made by the Seller in this
Agreement,
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or pursuant hereto, shall be deemed joint and several, except as
otherwise expressly stated, and shall survive the Closing and any investigation
conducted in connection with this Agreement for a period of three (3) years.
17. POST OFFICE BOX AND TELEPHONE NUMBER. The Seller's post office box
number, P. O. Box ______, and telephone number _____________, shall be the
property of the Partnership. The Partnership agrees to turn over to Seller all
mail of a purely personal nature to Seller on a daily basis or as otherwise
requested by Seller.
18. CLAIMS. Following Closing, Seller shall have no claims against or
be due any sums from Partnership except as otherwise provided pursuant to the
terms of this Agreement and any related agreements.
19. BENEFIT. This Agreement shall be binding upon, and inure to the
benefit of, the respective legal representatives of the Seller, and the
successors and assigns of the Buyer. Without limiting the foregoing, the
Seller's rights hereunder may be enforced by it in its own name. In the event
that the Buyer causes the assets and business of the Seller to be transferred to
some other corporation, the rights of the Buyer of the Seller hereunder may be
enforced by such other corporation in its own name.
20. ENFORCEMENT. This Contract may be enforced by a specific
performance action by the Buyer if the Seller, without just cause, refuses to
complete this Agreement in addition to any other remedy Buyer may have at law or
in equity.
21. CONSTRUCTION. This Agreement shall be governed by the laws of the
State of Florida.
22. NOTICES. All notes, requests, demands, and other communications
hereunder shall be in writing, and shall be deemed to have been duly given if
delivered or mailed, first class postage prepaid, if to Seller, at P. X. Xxxxxx
XX, Xxxxx Xxxx, Xxxxxxx 00000, with a copy to Xxxxxx X. Xxxxxxx, Esq., Trinkle,
Redman, Xxxxxxx, Xxxx & Coton, P.A., X. X. Xxxxxx XX, Xxxxx Xxxx, Xxxxxxx 00000,
or at such other address as either of them may have furnished to the Buyer in
writing, or, if to the Buyer, 000 X. Xxxx Xxxxxxx Xx., #000, Xxxxxxx, Xxxxxxx
00000, with a copy to: J. Xxxxxxx Xxxxxxxxx, Esquire, Xxxxxx & Xxxxx, L.L.P., 00
Xxxxx Xxxxxx Xxx., Xxxxx 0000, Xxxxxxx, XX 00000-0000 or at such other addresses
as Buyer may have furnished to Seller in writing.
23. EXPENSES. Each of the parties shall bear all expenses incurred by
it in connection with this Agreement and in the consummation of the transactions
contemplated hereby and in preparation thereof.
24. ATTORNEYS' FEES. In the event it becomes necessary for either party
to enforce the terms of this Agreement, the prevailing party shall be entitled,
in addition to such damages or other relief as may be granted, to recover
reasonable attorneys' fees and costs, such attorneys' fees to include those
incurred on any appeal.
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25. COOPERATION. Seller is an authorized Ford "Dealer" and agrees to
cooperate in assisting Buyer to obtain approval of the Partnership as a Ford
Dealer-Operator. Seller agrees to assign to the Partnership at the Closing all
of its rights and interest in any Ford parts returns privileges. Seller shall
assign to the Partnership the balance as of the date of closing allocable to
Seller in connection with any advertising cooperative or association.
26. DEMONSTRATORS. Seller shall be entitled to three demonstrators for
the use of Xxxx Xxxxxx, Xxxxx Xxxxxx and Xxxxxx Xxxxxx for five (5) years from
the date of Closing. The vehicles shall be provided as mutually agreed by the
parties , subject to availability.
27. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
among the parties hereto and supersedes and cancels any prior agreements,
representations, warranties, or communications, whether oral or written, among
the parties hereto relating to the transactions contemplated hereby or the
subject matter herein. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an agreement in
writing signed by the party against whom or which the enforcement of such
change, waiver, discharge or termination is sought.
Executed the day and year first above written.
Signed in the presence of: SELLER:
XXXX XXXXXX XXXX, INC.
____________________________
Print Name:_________________
____________________________ By:_____________________________
Print Name:_________________ Name:___________________________
Title:__________________________
Executed by the undersigned solely for purposes of agreeing to the provisions of
the non-compete agreement referenced in Section 14:
____________________________________
Print Name:_________________________
____________________________________
Print Name:_________________________
____________________________
____________________________________ XXXXXX XXXXXX
Print Name:_________________________
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____________________________________ ___________________________
Print Name:_________________________ XXXX X. XXXXXX, XX.
____________________________________
Print Name:_________________________
____________________________________ ___________________________
Print Name:_________________________ XXXXXX X. XXXXXX
BUYER:
XXXXXX ACQUISITIONS, INC.
____________________________________
Print Name:_________________________
By:________________________
____________________________________ X. Xxxxxx Peacock,
Print Name:_________________________ Vice President
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ESCROW PROVISION
The undersigned ("Escrow Agent") hereby agrees to hold and disburse the
Deposit hereinabove described in accordance with the foregoing Agreement, upon
condition, however, that if Seller and Buyer shall disagree as to the manner in
which the Deposit is to be disbursed, or if the Deposit shall become the subject
of a controversy between Seller and Buyer, the undersigned, without liability or
obligation to either Seller or Buyer, may pay the Deposit into the Registry of
the Circuit Court of the Ninth Judicial Circuit of Florida, in and for Orange
County, and commence an interpleader action in that Court with regard to the
Deposit.
ESCROW AGENT:
Xxxxxx & Xxxxx, L.L.P.
By:_________________________________
J. Xxxxxxx Xxxxxxxxx, Esq.
Seller and Buyer hereby agree to the above conditions and furthermore
Seller agrees to hold Escrow Agent harmless from any and all claims, demands,
injuries and damages arising out of or in connection with its duties hereunder
as Escrow Agent.
BUYER:
XXXXXX ACQUISITIONS, INC.
By: _______________________________
Its:___________________________
000 Xxxxx Xxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
(Address)
SELLER:
XXXX XXXXXX XXXX, INC.
By: _______________________________
Its:
_______________________________
_______________________________
(Address)
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