SALE/PURCHASE OF ASSETS AGREEMENT
This Sale/Purchase of Assets Agreement (the "Agreement") is entered
into this 30th day of November, 1998, by and among Xxxxxxxxxx Hotel, L.L.C., a
Virginia limited liability company ("Seller"), and Ohio Key I, Inc., a Florida
corporation, and Ohio Key II, Inc., a Florida corporation, (collectively the
"Purchaser").
WHEREAS, Seller owns a leasehold interest, equipment, inventories,
contract rights, and miscellaneous assets (the "Assets"); and
WHEREAS, Purchaser desires to acquire substantially all of the Assets
of Seller, and Seller desires to sell the Assets to Purchaser.
NOW THEREFORE, IT IS AGREED AS FOLLOWS:
Section 1. Assets Purchased; Liabilities Assumed.
1.1 Assets Purchased. Seller agrees to sell to Purchaser and Purchaser
agrees to purchase from Seller, on the terms and conditions set forth in this
Agreement, all of the assets of Seller, including, but not limited to, that
certain leasehold interest owned by Seller in the proeprty known as the
Xxxxxxxxxx Hotel (the "Hotel"), consisting of a 282 room hotel, together with
all buildings, improvements, attachments and appurtenances thereon and thereunto
belonging together with all furniture, furnishings, equipment, linen and supply
inventory, and all other personal property owned by Seller and used in
connection with the ownership, operations, and maintenance of the Hotel
(hereinafter together call the "Personalty"), excepting cash, receivables (less
advance deposits), utility deposits, food and beverage inventories, which are to
be purchaser at cost from the Seller at Closing.
1.2 Liabilities Assumed. Purchaser shall accept the assignment and
assume responsibility for the payment of the following outstanding liens: (a)
Deed of Trust Note dated January 22, 1998, in the original principal amount of
$2,000,000.00, executed by Xxxxx X. Xxxxxxxx and secured by a Deed of Trust on
the Hotel; and (b) Deed of Trust Note dated January 22, 1998, in the original
principal amount of $1,000,000.00, executed by Xxxxx X. Xxxxxxxx and secured by
a Deed of Trust on the Hotel.
Section 2. Purchase Price. The purchase price for the Assets shall be Five
Million Three Hundred Fifty Thousand and 00/100 Dollars ($5,350,000.00), which
shall be payable in full at closing.
Section 3. Payment of Purchase Price. The price for the Assets shall be paid as
follows:
3.1 Deposit. No deposit shall be required to be made in connection with
this Agreement.
3.2 Balance of Purchase Price. At Closing, Purchaser shall pay the
entire purchase price to Seller by cash, cashier's check, certified check, wire
transfer or other immediately available funds, subject to credit for the
outstanding loans assumed by Purchaser.
Section 4. Seller's Representations and Warranties. Seller represents and
warrants to Purchaser as follows:
4.1 Existence. Seller is now and on the Closing Date will be a limited
liability company duly organized and validly existing and in good standing under
the laws of the State of Virginia. Seller has all requisite power and authority
to own the Assets and to carry on its business as now being conducted.
4.2 Authorization. The execution, delivery, and performance of this
Agreement have been or will be prior to Closing duly authorized and approved by
the members of Seller, and this Agreement constitutes a valid and binding
Agreement of Seller in accordance with its terms. If such authorization is not
duly given, then either party shall be entitled to terminate this Agreement.
4.3 Title to Assets. Seller holds good and marketable title to the
Assets, free and clear of restrictions on or conditions to transfer or
assignment, and free and clear of liens, pledges, charges, or encumbrances,
excepting only the outstanding loans being assumed by the Purchaser. Seller has
not previously assigned its interest in the Assets.
4.4 Transfer Subject to Third-Party Approval. The parties understand
that assignment of the current lease relating to the Hotel requires the consent
of the Department of the Army and of Xxxxxxxxxx Hotel Company.
4.5 Accuracy of Representations and Warranties. None of the
representations or warranties of Seller contain or will contain any untrue
statement of a material fact or omit or will omit or misstate a material fact
necessary in order to make statements in this Agreement not misleading. Seller
knows of no fact that has resulted or will result in a material change in the
business, operations, or assets of Seller that has not been set forth in this
Agreement or otherwise disclosed to Purchaser.
Section 5. Representations of Purchaser. Purchaser represents and warrants as
follows:
5.1 Corporate Existence. Purchaser is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Virginia.
Purchaser has all requisite corporate power and authority to enter into this
Agreement and perform its obligations hereunder.
5.2 Authorization. The execution, delivery, and performance of this
Agreement have been duly authorized and approved by the board of directors and
shareholders of Purchaser, and this Agreement constitutes a valid and binding
Agreement of Purchaser in accordance with its terms.
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5.3 Accuracy of Representations and Warranties. None of the
representations or warranties of Purchaser contain or will contain any untrue
statement of a material fact or omit or will omit or misstate a material fact
necessary in order to make the statements contained herein not misleading.
Section 6. Covenants of Seller. Seller covenants and agrees as follows:
6.1 Seller's Operation of Business Prior to Closing. Seller agrees that
between the date of this Agreement and the Closing, Seller will not assign,
sell, lease, or otherwise transfer or dispose of any of the Assets, except in
the normal and ordinary course of business and in connection with its normal
operation.
6.2 Conditions and Best Efforts. Seller will use its best efforts to
effectuate the transactions contemplated by this Agreement and to fulfill all
the conditions of the obligations of Seller under this Agreement, and will do
all acts and things as may be required to carry out its obligations under this
Agreement and to consummate and complete this Agreement.
Section 7. Covenants of Purchaser. Purchaser covenants and agrees as follows:
7.1 Conditions and Best Efforts. Purchaser will use its best efforts to
effectuate the transactions contemplated by this Agreement and to fulfill all
the conditions of Purchaser's obligations under this Agreement, and shall do all
acts and things as may be required to carry out Purchaser's obligations and to
consummate this Agreement.
Section 8. Conditions Precedent to Purchaser's Obligations. The obligation of
Purchaser to purchase the Assets is subject to the fulfillment, prior to or at
the Closing, of each of the following conditions, any one or more of which may
be waived in writing by Purchaser:
8.1 Representations, Warranties, and Covenants of Seller. All
representations and warranties made in this Agreement by Seller shall be true as
of the Closing as fully as though such representations and warranties had been
made on and as of the Closing and, as of the Closing, Seller shall not have
violated or have failed to perform in accordance with any covenant contained in
this Agreement.
8.2 Conditions of the Assets. There shall have been no material adverse
change in the manner or character of the Assets prior to the Closing.
Section 9. Conditions Precedent to Obligations of Seller. The obligations of
Seller to consummate the transactions contemplated by this Agreement are subject
to the fulfillment, prior to or at the Closing, of each of the following
conditions, any one or more of which may be waived in writing by Seller;
9.1 Representations, Warranties, and Covenants of Purchaser. All
representations and warranties made in this Agreement by Purchaser shall be true
as of the Closing as fully as though such representations and warranties had
been made on and as of the Closing, and Purchaser shall not have violated or
shall not have failed to perform in accordance with any covenant contained in
this Agreement.
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Section 10. Purchaser's Acceptance. Purchaser represents and acknowledges that
it has entered into this Agreement on the basis of its own examination, personal
knowledge, and opinion of the value of the Assets. Purchaser has not relied on
any representations made by Seller other than those specified in this Agreement.
Seller makes no representation as to the value of the Assets or the status of
any of the choses in action being assigned to Purchaser. All of the Assets are
being sold by Seller and accepted by Purchaser "AS IS, WHERE IS, WITHOUT
WARRANTY, EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT."
Section 11. Indemnification and Survival.
11.1 Survival of Representations and Warranties. All representations
and warranties made in this Agreement shall survive the Closing of this
Agreement, except that any party to whom a representation or warranty has been
made in this Agreement shall be deemed to have waived any misrepresentation or
breach of representation or warranty of which such party had knowledge prior to
Closing. Any party learning of a misrepresentation or breach of representation
or warranty under this Agreement shall immediately give written notice thereof
to all other parties to this Agreement.
11.2 Seller's Indemnification. Seller hereby agrees to indemnify and
hold Purchaser, its successors, and assigns harmless from and against:
11.2.1 Any and all claims, liabilities, and obligations of
every kind and description, contingent or otherwise, arising out of or
related to the operation of Seller's business prior to the close of
business on the day before the Closing, except for claims, liabilities,
and obligations of Seller expressly assumed by Purchaser under this
Agreement or paid by insurance maintained by Seller or Purchaser.
11.2.2 Any and all damage or deficiency resulting from any
material misrepresentation, breach of warranty or covenant, or
nonfulfillment of any agreement on the part of Seller under this
Agreement.
Seller's indemnity obligations under this Section 11.2 shall be subject
to the following: If any claim is asserted against Purchaser that would give
rise to a claim by Purchaser against Seller for indemnification under the
provisions of this Section, then Purchaser shall promptly give written notice to
Seller concerning such claim and Seller shall, at no expense to Purchaser,
defend the claim.
11.3 Purchaser's Indemnification. Purchaser agrees to defend,
indemnify, and hold harmless Seller from and against:
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11.3.1 Any and all claims, liabilities, and obligations of
every kind and description arising out of or related to the operation
of the business following Closing or arising out of Purchaser's failure
to perform obligations of Seller assumed by Purchaser pursuant to this
Agreement.
11.3.2 Any and all damage or deficiency resulting from any
material misrepresentation, breach of warranty or covenant, or
nonfulfillment of any agreement on the part of Purchaser under this
Agreement.
Purchaser's indemnity obligations under this Section 11.3 shall be
subject to the following: If any claim is asserted against Seller that would
give rise to a claim by Seller against Purchaser for indemnification under the
provisions of this Section, then Seller shall promptly give written notice to
Purchaser concerning such claim and Purchaser shall, at no expense to Seller,
defend the claim.
Section 12. Closing.
12.1 Time and Place. This Agreement shall be closed at Diamonstein,
Xxxxxx & Xxxxxx, P.L.C., at 5:00 p.m. on November 30, 1998, or at such other
time as the parties may agree in writing. If Closing has not occurred on or
prior to midnight, November 30, 1998, then any party may elect to terminate this
Agreement
12.2 Obligations of Seller at the Closing. At the Closing Seller shall
deliver to Purchaser one or more bills of sale and/or assignments conveying to
Purchaser all of Seller's interest in the Assets.
12.3 Obligations of Purchaser at the Closing. At the Closing Purchaser
shall deliver to Seller the Purchase Price.
12.4 Books and Records. This sale includes the books of account and
records of Seller's business.
12.5 Seller's Right to Pay. In the event Purchaser fails to make any
payment that Purchaser is required to pay to third parties under this Agreement,
Seller shall have the right, but not the obligation, to pay the same. Purchaser
will reimburse Seller for any such payment immediately upon Seller's demand. Any
such payment by Seller shall not constitute a waiver by Seller of any remedy
available by reason of Purchaser's default for failure to make the payments.
Section 13. Default.
13.1 Remedies. If Purchaser fails to perform any of the terms,
covenants, conditions, or obligations of this Agreement, time of payment and
performance being of the essence, then Seller, subject to the requirements of
the notice provided in this Agreement, may have any or all of the following
remedies:
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13.1.1 The right to retake control of the Assets and all
choses in action without any payment or compensation to Purchaser.
13.1.2 The right to exercise any other remedy available to the
Seller at law or in equity.
13.2 Notice of Default. Purchaser shall not be deemed in default for
failure to perform the terms, covenants, and conditions of this Agreement until
notice of the default has been given to Purchaser and Purchaser has failed to
remedy the default within thirty (30) days after the notice.
Section 14. Bulk Transfers. Intentionally Omitted.
Section 15. Miscellaneous Provisions.
15.1 Amendment and Modification. Subject to applicable law, this
Agreement may be amended, modified, or supplemented only by a written agreement
signed by all of the parties hereto.
15.2 Notices. All notices, requests, demands, and other communications
required or permitted hereunder will be in writing and will be deemed to have
been duly given when delivered by hand or two days after being mailed by
certified or registered mail, return receipt requested, with postage prepaid to
the parties at their respective addresses.
15.3 Law Governing. This Agreement shall be governed by and construed
in accordance with the laws of the State of Virginia.
15.4 Computation of Time. In computing any period of time pursuant to
this Agreement, the day of the act, event or default from which the designated
period of time begins to run shall be included, unless it is a Saturday, Sunday
or a legal holiday, in which event the period shall begin to run on the next day
which is not a Saturday, Sunday or legal holiday.
15.5 Titles and Captions. All section titles or captions contained in
this Agreement are for convenience only and shall not be deemed part of the
context nor affect the interpretation of this Agreement.
15.6 Pronouns and Plurals. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, neuter, singular or plural
as the identity of the person or persons may require.
15.7 Entire Agreement. This Agreement contains the entire understanding
between and among the parties and supersedes any prior understandings and
agreements among them respecting the subject matter of this Agreement. Any
amendments to this Agreement must be in writing and signed by the party against
whom enforcement of that amendment is sought.
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15.8 Agreement Binding. This Agreement shall be binding upon the heirs,
executors, administrators, successors and assigns of the parties hereto.
15.9 Presumption. This Agreement or any Section thereof shall not be
construed against any party due to the fact that said Agreement or any Section
thereof was drafted by said party.
15.10 Further Action. The parties hereto shall execute and deliver all
documents, provide all information and take or forbear from all such action as
may be necessary or appropriate to achieve the purpose of the Agreement.
15.11 Counterparts. This Agreement may be executed in several
counterparts and all so executed shall constitute one Agreement, binding on all
the parties hereto even though all the parties are not signatories to the
original or the same counterpart.
15.12 Parties in Interest. Nothing herein shall be construed to be to
the benefit of any third party, nor is it intended that any provision shall be
for the benefit of any third party.
15.13 Savings Clause. If any provision of this Agreement, or the
application of such provision to any person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such provision
to persons or circumstances other than those as to which it is held invalid,
shall not be affected thereby.
15.15 Tax Deferred Exchange. Purchaser and Seller request that this
transfer be treated as an Internal Revenue Code Section 1031 Tax Deferred
Exchange. The parties agree to cooperate in effecting the exchange in accordance
with Section 1031 of the Internal Revenue Code, including execution of any
documents that may be reasonably necessary to effect the exchange.
WITNESS, the following signatures as of the date first set forth above.
Ohio Key I, Inc.
By: /s/ C. Xxxx Xxxxx, Xx.
----------------------------
Its: President
Ohio Key II, Inc.
By: /s/ C. Xxxx Xxxxx, Xx.
----------------------------
Its: President
Xxxxxxxxxx Hotel, L.L.C.
By: /s/ Xxxxx Xxxxxxxx
----------------------------
Its: President
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