EXHIBIT 2.2
PROPERTY OPTION AGREEMENT
PROPERTY OPTION AGREEMENT, dated effective March 6, 2002 (this
"Agreement"), by and between Fog Cutter Capital Group Inc., a Maryland
corporation (the "Company"), and the individuals indicated on the signature
page(s) and listed on Schedule 1 hereto (collectively, the "Stockholder"), each
a stockholder of the Company.
WHEREAS, the Stockholder is the owner of the shares of common stock,
par value $.0001 per share ("Company Common Stock"), of the Company set forth on
Schedule 1 hereto (the "Subject Shares"); and
WHEREAS, the Stockholder wishes to sell the Subject Shares for cash and
a certain real estate property described herein; and
WHEREAS, the Company desires to acquire the Subject Shares, from time
to time, in the manner provided herein to prevent any adverse impact on its
share price, to acquire shares at a discount to book value, to protect its
liquidity position and to dispose of certain non-core real estate assets; and
WHEREAS, the Company desires to acquire an option to put a certain real
estate property described herein at the exercise price and during the exercise
period specified in Section 1 below, and Stockholder is willing to grant such
option to the Company in exchange for the consideration and on the terms set
forth in this Agreement; and
WHEREAS, the Stockholder requested an option to put all (but not less
than all) of the Subject Shares at the exercise price and during the exercise
period specified in Section 2 below, and Company is willing to grant such option
in exchange for the consideration and on the terms set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth herein, and
intending to be legally bound hereby, the Stockholder and the Company agree as
follows:
1. COMPANY PUT OPTION.
(a) GRANT OF PUT OPTION. Subject to the terms and conditions
set forth in this Agreement, the Stockholder hereby grants to the Company the
option (the "Put Option") to require the Stockholder to purchase, during the Put
Option Exercise Period (as defined below), the Wilsonville Property (as defined
below) for the Property Put Purchase Price (as defined below in this Section 1).
(b) EXERCISE PRICE. For purposes of this Agreement, the
"Property Put Purchase Price" means $1,900,958.25, plus any cash dividends paid
by the Company on 623,265 shares of the Subject Shares and received by the
Stockholder between January 10, 2002, and the
Put Option Closing (as defined below). The amount payable by the Stockholder to
the Company pursuant to the foregoing is payable in U.S. Dollars. To secure
performance of the Company's obligations arising hereunder in connection with
any exercise of the Put Option, upon mutual execution of this Agreement, the
Company shall provide Stockholder with a deed of trust substantially in the form
of attached Exhibit 1(b) duly executed and acknowledged by the Company, for
recording against the Wilsonville Property. The trust deed shall contain
provisions for reconveyance of trust deed promptly upon performance by the
Company of its obligations under this Agreement. To secure performance of the
Stockholder's obligations arising hereunder in connection with any exercise of
the Put Option, upon mutual execution of this Agreement, the Stockholder shall
deliver 623,265 shares of the Subject Shares, duly endorsed in blank, to the
Company, to be held by the Company subject to the provisions of this Section
1(b). If the Put Option expires without it having been exercised by the Company
and the Wilsonville Property has not been conveyed to the Stockholder pursuant
to the Put Option described in Section 2 below, the Stockholder shall deliver to
the Company an executed original request for full reconveyance of the trust deed
relating to the Wilsonville Property and take all further actions necessary to
fully reconvey the property to the Company and any costs associated therewith
shall be paid one-half by the Company and one-half by the Stockholder and
neither the Company nor the Stockholder shall have any further obligations or
liability under this Section 1, except as expressly provided.
(c) PAYMENT AND DELIVERY. The Stockholder shall pay the
Property Put Purchase Price to the Company against delivery by the Company of an
Oregon statutory special warranty deed (the "Deed") representing the Wilsonville
Property at the Put Option Closing, subject to the conditions specified in
Section 1(b) above, at the Company's offices simultaneously with payment of the
Property Put Purchase Price. The Deed shall convey to the Stockholder (or its
designee(s)) all of the Company's right, title and interest in the Wilsonville
Property (such as it is) and be free and clear of any liens, claims, charges and
encumbrances of State Street Bank and Trust Company, as Trustee, for certain
lenders. The Company shall pay the cost of the premium for an ALTA Owner's
standard coverage title insurance policy insuring fee simple title vested in the
Stockholder (or its designee(s)), subject only to liens, claims, charges and
encumbrances approved in writing by both the Company and the Stockholder. All
customary prorations, including without limitation real property taxes, shall be
made as of the date of delivery of the Deed. Any escrow fee shall be paid
one-half by the Company and one-half by the Stockholder. All other closing costs
shall be paid by parties in accordance with local custom.
(d) EXERCISE PERIOD. The Company's right to require
Stockholder to purchase the Wilsonville Property will commence upon January 11,
2003, and will terminate and expire on January 20, 2003 (such period, the "Put
Option Exercise Period"), subject to the provisions of Section 1(e) below.
(e) EXERCISE OF PUT OPTION.
(i) At any time during the Put Option Exercise
Period, the Company may exercise the Put Option by delivering to the Stockholder
a written notice in substantially the form attached hereto as Exhibit 1(e) (the
"Put Option Exercise Notice").
(ii) The Company shall not be under any obligation to
exercise the Put Option, and may allow the Put Option to expire without
requiring the Stockholder to purchase the Wilsonville Property. Notwithstanding
any provision herein contained to the contrary, the Company shall have no right
to exercise the Put Option if (A) the Put Option described in Section 2 below
has been exercised, (B) pursuant to the Put Option described in Section 2 below,
a Property Delivery Failure Notice has been delivered by the Stockholder and the
Stockholder has delivered to the Company an executed original request for full
reconveyance of the trust deed relating to the Wilsonville Property as described
and authorized by the provisions of said Section 2 below or (C) the Wilsonville
Property is for any reason not a separate legal parcel under Oregon law.
(f) CLOSING. The Closing for the purchase and sale, if any, of
the Wilsonville Property (the "Put Option Closing") shall occur in Portland,
Oregon, or such other location as the parties may agree, as promptly as
practicable, and in any event within three (3) business days, after the
Stockholder's receipt of the Put Option Exercise Notice. In the manner and
subject to the terms set forth in this Section 1, the Company shall deliver the
Deed to the Stockholder, against delivery of the Property Put Purchase Price in
U.S. dollars in immediately available funds and by wire transfer to such account
as the Company directs in writing at least two (2) days prior to the Put Option
Closing.
2. STOCKHOLDER PUT OPTION.
(a) GRANT OF PUT OPTION. Subject to the terms and conditions
set forth in this Agreement, the Company hereby grants to the Stockholder an
option (the "Put Option") to require the Company to purchase, during the Put
Option Exercise Period (as defined below), the Subject Shares for the Subject
Shares Put Purchase Price (as defined below).
(b) EXERCISE PRICE. The Subject Shares Put Purchase Price
means $317,108.50 (the "Cash Payment"), less any cash dividends paid by the
Company on the Subject Shares and received by the Stockholder between January
10, 2002, and the Put Option Closing (as defined below), plus the delivery (the
"Property Delivery") of the Wilsonville Property on the Put Option Closing (as
defined below). The amount payable by the Company to the Stockholder pursuant to
the foregoing is payable in U.S. Dollars. To secure performance of the Company's
obligations arising hereunder in connection with any exercise of the Put Option,
upon mutual execution of this Agreement, the Company shall provide Stockholder
with (i) a deed of trust substantially in the form of attached Exhibit 1(b) duly
executed and acknowledged by the Company, for recording against the Wilsonville
Property and (ii) a pledge of 175,000 shares of Wilshire Financial Services
Group Inc., as provided in Section 1(b) above, such deed of trust and pledged
shares to be held by the Stockholder subject to the provisions of this Section
2(b). To secure performance of the Stockholder's obligations arising hereunder
in connection with any exercise of the Put Option, upon mutual execution of this
Agreement Stockholder shall deliver the Subject Shares, duly endorsed in blank,
to the Company, to be held by the Company subject to the provisions of this
Section 2(b). The Company agrees to use its best efforts to complete a partition
of the Wilsonville Property within one hundred eighty (180) days after the date
of this Agreement, such partition to be made as contemplated by and consistent
with existing agreements affecting the Wilsonville Property and the remainder of
the parcel of which it is
currently a part. The Company agrees to pay all reasonable costs and to use its
best efforts to satisfy all governmental conditions (other than provision of
access to the Wilsonville Property) related to the partition. If the partition
has not been consummated within such one hundred eighty (180) day period
(whether as a result of a delay in the partition process or otherwise) and the
Stockholder determines in good faith and in its reasonable judgment that the
partition is likely not to be completed within an additional period of sixty
(60) days commencing at the end of such one hundred eighty (180) day period or
that the Company is likely not to be able to deed the Wilsonville Property to
the Stockholder, within such 60-day period, subject only to liens, claims,
charges and encumbrances approved in writing delivered by Stockholder to the
Company within ninety (90) days after the date of this Agreement, then within
ten (10) days after receipt of written notice of such determination (the
"Property Delivery Failure Notice") by the Stockholder (which notice must be
received by the Company within 10 days of the end of such one hundred eighty
(180) day period), the Company and the Stockholder shall meet to discuss
alternatives to the Property Delivery. If a mutually acceptable alternative to
the Property Delivery has not been agreed in writing within thirty (30) days
after the parties' first meeting to discuss alternatives (i) the pledge with
respect to the Subject Shares shall be terminated and any termination or
cancellation costs shall be paid one-half by the Company and one-half by the
Stockholder, (ii) the Subject Shares shall be returned to the Stockholder, (iii)
the Stockholder shall return to the Company the pledged shares of Wilshire
Financial Services Group Inc. and shall deliver to the Company an executed
original request for full reconveyance of the trust deed relating to the
Wilsonville Property and take all further actions necessary to fully reconvey
the property to the Company and any costs associated therewith shall be paid
one-half by the Company and one-half by the Stockholder and (iv) neither the
Company nor the Stockholder shall have any further obligations or liability
under this Section 2, except as expressly provided.
(c) PAYMENT AND DELIVERY. Payment of the Subject Shares Put
Purchase Price shall be made to the Stockholder by the Company making the Cash
Payment and delivering an Oregon statutory special warranty deed (the "Deed")
representing the Wilsonville Property at the Put Option Closing and subject to
the conditions specified in Section 2(b) above, against delivery by the
Stockholder of a stock certificate or certificates representing Stockholder's
Subject Shares, duly endorsed for transfer or accompanied by duly executed (and,
if required, guaranteed) stock powers, at the Company's offices simultaneously
with the delivery of the Cash Payment and the Deed. In each case, the Subject
Shares shall be free and clear of all liens, claims, charges and encumbrances of
any kind whatsoever. The Deed shall convey to the Stockholder (or its
designee(s)) all of the Company's right, title and interest in the Wilsonville
Property (such as it is) and be free and clear of any liens, claims, charges and
encumbrances of State Street Bank and Trust Company, as Trustee, for certain
lenders. As provided in Section 1(c) above, the Company shall pay the cost of
the premium for one ALTA Owner's standard coverage title insurance policy
insuring fee simple title vested in the Stockholder (or its designee(s)),
subject only to liens, claims, charges and encumbrances approved in writing by
both the Company and the Stockholder. All customary prorations, including
without limitation real property taxes, shall be made as of the date of delivery
of the Deed. Any escrow fee shall be paid one-half by the Company and one-half
by the Stockholder. All other closing costs shall be paid by parties in
accordance with local custom.
(d) EXERCISE PERIOD. The Stockholder's right to require the
Company to purchase the Subject Shares will commence on January 2, 2003, and
will terminate and expire on January 10, 2003 (such period, the "Put Option
Exercise Period").
(e) EXERCISE OF PUT OPTION.
(i) At any time during the Put Option Exercise Period
after completion of a partition of the Wilsonville Property in accordance with
this Section 2, the Stockholder may exercise the Put Option as to all (but not
less than all) of the Subject Shares by delivering to the Company a written
notice in substantially the form attached hereto as Exhibit 2(e) (the "Put
Option Exercise Notice").
(ii) The Stockholder shall not be under any
obligation to exercise the Put Option, and may allow the Put Option to expire
without purchasing any Subject Shares hereunder.
(f) CLOSING. The Closing for the purchase and sale, if any, of
the Subject Shares (the "Put Option Closing") shall occur in Portland, Oregon,
or such other location as the parties may agree, as promptly as practicable, and
in any event within three (3) business days, after the Company's receipt of the
Put Option Exercise Notice. Thereupon, the stock certificate or certificates
representing Stockholder's Subject Shares, duly endorsed for transfer or
accompanied by duly executed (and, if required, guaranteed) stock powers
previously delivered by the Stockholder to the Company will be deemed to have
been delivered to the Company. Purchased Subject Shares shall be free and clear
of all liens, claims, charges, and encumbrances of any kind whatsoever. In the
manner and subject to the terms set forth in this Section 2, the Company shall,
against delivery of the Subject Shares, deliver the Deed to the Stockholder and
pay to Stockholder the Cash Payment in U.S. dollars in immediately available
funds, by wire transfer to such account as the Stockholder directs in writing at
least two (2) days prior to the Put Option Closing.
(g) FRACTIONAL SHARES. The Company will not be required to
purchase any fractional Subject Shares upon exercise of the Put Option.
(h) SECURITY FOR PERFORMANCE. Notwithstanding anything herein
contained apparently to the contrary, the security granted by the parties to
secure performance of their obligations hereunder shall apply, depending on
which put option provided herein is exercised, if any, only to performance of
the obligations arising in connection with the exercised put option, not both
put options.
3. CONFIDENTIALITY; NON-DISPARAGEMENT.
(a) The Stockholder agrees to reasonably provide specific
operations information to the Company as requested in a reasonable, timely and
clear manner to allow the Company to continue and/or complete job tasks,
activities, assignments, to continue effective relationships with business
partners by responding to reasonable inquiries as needed by telephone at no
additional cost to the Company beyond what is provided by this Agreement and
Company agrees it will reimburse the Stockholder's reasonable out-of-pocket
expenses in providing such assistance.
(b) The Stockholder agrees that it will not engage in
Detrimental Activity during and following the term of this Agreement. For
purposes of this Agreement, "Detrimental Activity" shall mean: (i) the
disclosure to anyone outside the Company, or the use in any manner other than in
the furtherance of the Company's business, without written authorization from
the Company, of any confidential information or proprietary information,
relating to the business of the Company, except as required by law; (ii) any
attempt, directly or indirectly by the Stockholder of Solicitation (as defined
below) within 6 months of the end of this Agreement; (iii) any conduct by the
Stockholder which would be considered to be self-dealing or which would conflict
with the Company's interests, including the direct or indirect purchase or sale
of, or loan or investment of any type in, any assets of the Company by the
Stockholder or for the Stockholder's benefit or between the Stockholder and a
third party which is unrelated to the Company, without the company's prior
written authorization; (iv) the Stockholder's Disparagement (as defined herein),
or inducement of others to do so, of the Company or its past and present
officers, directors, employees or products; or (v) without written authorization
from the Company, the rendering of services for any organization, or engaging,
directly or indirectly, in any business, which is competitive with the Company,
or the rendering of services to such organization or business if such
organization or business is otherwise prejudicial to or in conflict with the
interests of the Company. For purposes of this Agreement, "Disparagement" means
making comments or statements to the press, the Company's employees, consultants
or any individual or entity with whom the Company has a business relationship or
otherwise taking any action, except as required by law, which could reasonably
be expected to adversely affect in any manner: the conduct of the business of
the Company (including, without limitation, any products or business plans or
prospects); or the business reputation of the Company, or any of its products,
or its past or present officers, directors or employees. For purposes of this
Agreement, "Solicitation" shall mean recruiting, soliciting or inducing of any
nonclerical employee or employees of the Company to terminate his or her
employment with, or otherwise cease his or her relationship with, the Company or
hiring or assisting another person or entity to hire (including, but not limited
to identifying a nonclerical employee to another employer for employment) any
nonclerical employee of the Company or any person who within six (6) months
before had been a nonclerical employee of the Company; or, soliciting or
inducing any customer of the Company to cease his or her relationship with the
Company.
4. REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER. Stockholder hereby
represents and warrants to the Company, as of the date hereof and as of any
closing date hereunder, as follows:
(a) OWNERSHIP. Stockholder beneficially owns the shares of
Company Common Stock set forth opposite Stockholder's name(s) on Schedule 1
hereto and such shares are the only shares of the Company Common Stock
beneficially or otherwise owned by the Stockholder.
(b) DUE AUTHORIZATION. Stockholder has all necessary power and
authority (or, if an individual, capacity), to execute and deliver this
Agreement and to consummate the
transactions contemplated hereby. Stockholder beneficially owns all of its
Subject Shares with no restrictions on Stockholder's voting rights or rights of
disposition pertaining thereto; such Subject Shares constitute all shares of
Company Common Stock beneficially owned by Stockholder; and upon exercise of the
Stockholder's Put Option provided herein (together with the Company's Put
Option, the "Options"), Stockholder will deliver good and marketable title to
the applicable shares of the Subject Shares (collectively, the "Option Shares")
free and clear of liens, claims, encumbrances or rights or interests of others.
Assuming this Agreement has been duly and validly authorized, executed and
delivered by the Company, this Agreement constitutes a valid and binding
agreement of Stockholder, enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, moratorium or other
similar laws affecting creditors' rights generally or by the principles
governing the availability of equitable remedies.
(c) NO CONFLICTS. Neither the execution and delivery of this
Agreement, nor the consummation by Stockholder of the transactions contemplated
hereby, will conflict with or constitute a violation of or default under any
contract, commitment, agreement, arrangement or restriction of any kind to which
Stockholder is a party or by which Stockholder is bound.
(d) KNOWLEDGE OF STOCKHOLDER; NO OTHER REPRESENTATIONS.
Stockholder has independently acquired all of the necessary information that
Stockholder requires in order to make an informed decision to enter into this
Agreement and to grant the put option provided herein. Additionally, Stockholder
is an experienced investor, well and independently informed of the Company's
business, financial condition and prospects, and has not, in deciding to enter
into this Agreement and to grant the option provided herein, relied on any
representations or warranties by the Company other than those contained in this
Agreement, and the Company has not made any such additional representations or
warranties.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Stockholder, as of the date hereof, as follows:
(a) DUE AUTHORIZATION. The Company has the requisite capacity,
power and authority to enter into and perform this Agreement. Assuming this
Agreement has been duly and validly authorized, executed and delivered by
Stockholder, this Agreement constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, moratorium or other
similar laws affecting creditors' rights generally or by the principles
governing the availability of equitable remedies. The Company agrees to cause
each relevant affiliate of the Company to take any and all such acts as are
reasonably necessary to implement and give effect to the agreements of the
Company contained herein, including without limitation the grant of a trust deed
on the Wilsonville Property as provided herein, and represents and warrants that
each of such acts by each such affiliate will be for valuable consideration and
binding upon and enforceable against the relevant affiliate.
(b) NO CONFLICTS. Neither the execution and delivery of this
Agreement, nor the consummation by the Company of the transactions contemplated
hereby, will conflict with or
constitute a violation of or default under any contract, commitment, agreement,
arrangement or restriction of any kind to which the Company is a party or by
which the Company is bound.
6. ADJUSTMENT UPON CHANGES IN CAPITALIZATION, ETC.
(a) In the event of any change in the outstanding shares of
Company Common Stock by reason of a stock dividend, stock split, split-up,
recapitalization, combination, exchange of shares or similar transaction, the
type and number of Subject Shares, and the option price per share therefor,
shall be adjusted appropriately.
(b) In the event that the Company shall (i) enter into an
agreement to consolidate with or merge into any Person, other than one of its
subsidiaries or affiliates, and shall not be the continuing or surviving
corporation of such consolidation or merger, or (ii) enter into an agreement to
permit any Person, other than the Company or one of its subsidiaries or
affiliates, to merge into the Company and the Company shall be the continuing or
surviving corporation, but, in connection with such merger, the then outstanding
shares of Company Common Stock shall be changed into or exchanged for stock or
other securities of the Company or any other Person or cash or any other
property, or (iii) liquidate, then, and in each such case, the Company shall
thereafter, during the term of this Agreement, be entitled to receive, upon
exercise of the Options, the securities or properties which a holder of the
number of the Subject Shares or the Option Shares then deliverable upon the
exercise thereof will be entitled to receive upon such consolidation, merger or
liquidation, and Stockholder and the Company shall use their best efforts to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be practicable, in relation to any securities or property
thereafter deliverable upon exercise of the Options.
7. TERMINATION. Except for the provisions of Sections 3, 4 and 5, this
Agreement, and all rights and obligations of the parties hereunder, shall
terminate on January 21, 2003, or the earlier exercise of one of the Options
(but in no event sooner than three (3) business days following due and timely
delivery hereunder of a put option exercise notice); provided that the remedy
and enforcement provisions shall continue in effect for such period as needed in
the event the transaction to be completed upon due and timely exercise of one of
the Options has not been completed within three (3) business days after such
exercise.
8. TRANSFER OF THE SHARES.
(a) Prior to the termination of this Agreement, except as
otherwise provided herein, Stockholder shall not: (i) transfer, sell, gift-over,
pledge or otherwise dispose of, or consent to any of the foregoing ("Transfer"),
any or all of the Subject Shares or any interest therein; (ii) enter into any
contract, option or other agreement or understanding with respect to any
Transfer; (iii) grant any proxy, power-of-attorney or other authorization or
consent with respect to any of the Subject Shares; (iv) deposit any of the
Subject Shares into a voting trust, or enter into a voting agreement or
arrangement with respect to any of the Subject Shares; or (v) take any other
action, in each case if the same would in any way restrict, limit or interfere
with the performance of Stockholder's obligations hereunder or the transactions
contemplated hereby.
(b) Notwithstanding Subsection (a) above, Stockholder may make
transfers of Subject Shares to Stockholder's spouse or lineal descendants, to
any trust for the benefit of such holder or the benefit of such spouse and/or
lineal descendants, to any corporation, limited liability company or partnership
in which Stockholder, or the spouse and/or the lineal descendants of
Stockholder, are the direct and beneficial owners of all of the equity interests
for estate planning purposes (provided that Stockholder, such spouse and/or
descendants agree in writing to remain the beneficial owners of all such
interests until termination of this Agreement), or to the personal
representative of Stockholder upon Stockholder's death for purposes of
administration of Stockholder's estate or upon such holder's incompetency for
purposes of the protection and management of the assets of Stockholder; PROVIDED
that any such transferee shall, prior to such transfer, consent in a writing
delivered to the Company to be bound by this Agreement and deliver to the
Company an irrevocable power of attorney with respect to the transferred Subject
Shares.
9. NO SOLICITATION. Stockholder shall not, nor shall it permit any of
its subsidiaries or any of its affiliates to, nor shall it authorize or permit
any agent, officer, director or employee of, or any investment banker, attorney
or other advisor or representative of, Stockholder or any of their subsidiaries
or any of Stockholder's affiliates to, directly or indirectly, solicit,
initiate, or encourage any inquiries or proposals from, discuss or negotiate
with, or provide any non-public information to, any Person (other than the
Company) relating to any transaction involving the sale of any of the assets of
the Company, or any of the capital stock of the Company, or any merger,
consolidation, business combination, or similar transaction involving the
Company or any of its subsidiaries.
10. MISCELLANEOUS.
(a) STOCKHOLDER CAPACITY. No person signing this Agreement as
Stockholder shall be deemed to have made any agreement or understanding in his
or her capacity as a director or officer of the Company and no action taken by
any of the parties in his or her capacity as a director or officer of the
Company shall be deemed a breach of this Agreement. Each person comprising
Stockholder executes this Agreement solely in his or her capacity as the
beneficial owner, where applicable, of Company Common Stock..
(b) EXPENSES. Each of the parties hereto shall bear and pay
all of its own costs and expenses, incurred by it or on its behalf, in
connection with the transactions contemplated hereunder, including fees and
expenses of its own financial consultants, investment bankers, accountants and
counsel, except as specifically provided herein.
(c) WAIVER AND AMENDMENT. Any provision of this Agreement may
be waived at any time, in writing, by the party that is entitled to the benefits
of such provision. This Agreement may not be modified, amended, altered or
supplemented except upon the execution and delivery of a written agreement
executed by the parties hereto.
(d) ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARY;
SEVERABILITY. This Agreement (i) constitutes the entire agreement, and
supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter
hereof and (ii) is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder. If any term or provision of this
Agreement is held by a court of competent jurisdiction or a federal or state
regulatory agency to be invalid, void or unenforceable, the remainder of the
terms or provisions of this Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable. If for any reason such court or
regulatory agency determines that the Options do not permit Stockholder to sell
the full number of shares of Company Common Stock as provided in Sections 2(a)
and 3(a) it is the express intention of the Company to allow Stockholder to sell
such lesser number of shares as may be permissible without any amendment or
modification hereof.
(e) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, applicable to
contracts made between residents of that state, entered into and to be wholly
performed within that state, except for corporate matters mandatorily governed
by Maryland corporation law, which corporation law shall, to that extent only,
govern.
(f) HEADINGS. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
(g) NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed duly given if delivered personally, by
facsimile transmission (with confirmation), or if mailed by registered or
certified mail (return receipt requested) or by Federal Express or other
recognized overnight delivery service, to the parties at the following addresses
(or at such other address for a party as shall be specified by like notice):
If to Stockholder, to:
The address set forth under Stockholder's name on Schedule
1 hereto.
If to the Company, to:
Xxxxxx Xxxxxxxxxx
Fog Cutter Capital Group Inc.
0000 X.X. Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Telecopier no.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxxxxx, Esq.
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier no.: (000) 000-0000
(h) COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.
(i) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder or under the Options shall be assigned by
either of the parties hereto (whether by operation of law or otherwise) without
the prior written consent of the other party. Subject to the preceding sentence,
this Agreement shall be binding upon, inure to the benefit of and be enforceable
by, the parties hereto and their respective successors, assigns, heirs,
executors, administrators and other legal representatives.
(j) FURTHER ASSURANCES. Stockholder and the Company shall
execute and deliver all other documents and instruments and take all other
action that may be reasonably necessary in connection with the matters provided
for hereby.
(k) SPECIFIC PERFORMANCE. The parties acknowledge that it
would be impossible to fix money damages for violations of this Agreement and
that such violations will cause irreparable injury for which adequate remedy at
law is not available and, therefore, this Agreement must be enforced by specific
performance or injunctive relief. The parties hereto agree that either party
may, in its sole discretion, apply to any court of competent jurisdiction for
specific performance or injunctive or such other relief as such court may deem
just and proper in order to enforce this Agreement or prevent any violation
hereof and, to the extent permitted by applicable law, each party waives any
objection or defense to the imposition of such relief. Nothing herein shall be
construed to prohibit either party from bringing any action for an injunction
for a breach of this Agreement. Notwithstanding anything herein contained to the
contrary, neither party shall have any recourse hereunder against the other
party or any of its assets, except for the specific remedies provided in this
subparagraph (k) and the specific security provided in this Agreement by such
other party.
(l) SURVIVAL. The representations, warranties and agreements
in this Agreement shall survive any Closing hereunder.
(m) NEGOTIATION; MEDIATION. The parties agree to make all
reasonable efforts to settle any dispute arising under this Agreement through
good-faith negotiation. In the event that negotiation between the parties is
unsuccessful, the parties agree to attempt to settle outstanding issues through
mediation. The mediator will act in a neutral capacity as a facilitator or
intermediary, to assist the parties in arriving at a mutually acceptable
resolution of the dispute. The mediator shall not have the power to render a
binding decision or to serve as arbitrator, decisionmaker or fact-finder. The
mediator will be chosen by mutual agreement of Stockholder and the Company. If
the parties, within thirty days from the date of any put option exercise notice
or the Property Delivery Failure Notice cannot reach an agreement on a mediator
or if mediation fails to resolve the dispute(s) within thirty days after
appointment of the mediator, the parties agree to submit the dispute(s) to
binding arbitration in Portland, Oregon, pursuant to the rules of the
Arbitration Service of Portland, Inc.
(n) INDEPENDENT COUNSEL. Each of the parties acknowledges that
it has been represented, or has had the opportunity to be represented, by
independent counsel of such party's
choice throughout all negotiations that have preceded the execution of this
Agreement and that, to the extent applicable to such party, has executed the
same with consent and upon the advice of said independent counsel. Each party
and its counsel, as applicable, cooperated in the drafting and preparation of
this Agreement and the documents referred to herein, and any and all drafts
relating thereto shall be deemed the work product of the parties and may not be
construed against either party by reason of its preparation. Accordingly, any
rule of law or any legal decision that would require interpretation of any
ambiguities in this Agreement against the party that drafted it is of no
application and is hereby expressly waived. The provisions of this Agreement
shall be interpreted in a reasonable manner to effect the intentions of the
parties and this Agreement.
(o) MUTUAL RELEASE. In consideration of the mutual covenants
contained in this Agreement, including the payments to Stockholder and the
transfers of the Subject Shares to Company pursuant to this Agreement,
Stockholder and Company, each for itself and for its respective successors and
assigns (as to each party and its respective successors and assigns, as
applicable, hereinafter referred to collectively as "Releasers"), forever
release and discharge the Company or the Stockholder, as applicable, and any and
all of its respective subsidiaries, divisions, affiliated entities, employee
benefits and/or pension plans or funds, successors and assigns, and all of its
or their respective past and present officers, directors, members, shareholders,
trustees, agents and employees (as to each such party and its respective
entities and persons, as applicable, hereinafter referred to collectively as the
"Entities and Persons"), from any and all claims, demands, causes of action,
fees and liabilities of any kind whatsoever, whether known or unknown, which the
Company or the Stockholder, as applicable, ever had, or may have, or now has,
against the Entities and Persons of the other by reason of any actual or alleged
act, omission, transaction, practice, conduct, occurrence or other matter up to
and including the date of this Agreement. Notwithstanding the foregoing, the
foregoing release shall not cover rights of indemnification to which Jordan X.
Xxxxxxxxx is or was entitled under the Company's Certificate of Incorporation or
By-laws or otherwise with regard to his service as a director of the Company.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Stockholder and the Company have executed this
Property Option Agreement, each as of the day and year first written above.
FOG CUTTER CAPITAL GROUP INC.
By: /s/ R. Xxxxx Xxxxxxxxx
-----------------------------------
Name:
Title: SVP - CFO
STOCKHOLDER:
By: /s/ Jordan X. Xxxxxxxxx
-----------------------------------
Name: Jordan X. Xxxxxxxxx, Individually
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx, Individually
SCHEDULE 1
STOCKHOLDER
STOCKHOLDER SUBJECT SHARES
Jordan X. Xxxxxxxxx 497,835
Xxxxxx X. Xxxxx 229,400
-------
TOTAL 727,235
0000 XX Xxxxxx, 0xx Xxxxx
Xxxxxxxx, XX 00000
Telecopier no.: 000-000-0000
With a copy to:
Xxxxxx X. Xxxxxxx
Stoel Rives LLP
000 XX 0xx Xxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
Telecopier no.: 000-000-0000
SCHEDULE 2
WILSONVILLE PROPERTY
G.I. JOES
WILSONVILLE, OREGON
All right, title and interest of Company in and to that real property described
below, the record title to which is held by Madrona Park II, LLC, or its
successors or assigns, subject to certain covenants and conditions set forth in
that Statutory Special Warranty Deed ("Deed") originally recorded October 10,
2000 in the records of Clackamas County, Oregon at Document No. 2000-066042:
0000 XX XXXXXXXX XXXX
XXXXXXXXXXX, XX 00000
A tract of land in the South half of the Southwest quarter of Section 11,
Township 3 South, Range 1 West, of the Willamette Meridian, in the City of
Wilsonville, County of Clackamas and State of Oregon, said tract being a portion
of those tracts of land conveyed to Xxxxxx X. Xxxxxxxx as recorded in Book 106,
Page 316, Deed Records, and Xxxxx X. Xxxxxxxx, Xx. as recorded in Book 106, Page
317, Deed Records; said tract is described as follows:
BEGINNING at a 5/8 inch iron rod on the North line of that 25.00 foot wide tract
of land conveyed to the City of Wilsonville, for road purposes, as recorded as
Recorder's Fee No. 72-33376, Film Records, said beginning point bears South
89(Degree)34'52" West 1330.42 feet and North 00(Degree)27'08" West 25.00 feet
from the quarter corner on the South line of Section 11, said beginning point
also being on the Easterly line of that Transmission Line Easement conveyed to
the United States of America as recorded in Book 522, Page 49 and in Book 515,
Page 231, Deed Records; thence North 00(Degree)27'08" West 1292.97 feet along
the East line of said easement to a 5/8 inch iron rod on the South line of that
tract of land conveyed to Xxxxxx X. Xxxxxxxx as recorded in Book 105, Page 454,
Deed Records; thence North 89(Degree)28'53" East 556.25 feet along the said
South line of Xxxxxx Xxxxxxxx tract to a 5/8 inch iron rod on the Westerly line
of the Oregon Electric Railway Company right of way; thence following the
Westerly line thereof; South 32(Degree)07'22" East 337.01 feet to a 5/8 inch
iron rod at a point of curve; thence on a 2639.93 foot radius curve to the right
1083.79 feet along the arc (the long chord bears south 21(Degree)11'24" East
1077.23 feet) to a 5/8 inch iron rod on the North line of the aforesaid City of
Wilsonville tract; thence South 89(Degree)34'52" West 1114.63 feet to the point
of beginning.
EXCEPTING THEREFROM the Southerly 18 feet conveyed to the City of Wilsonville
for roadway purposes by instrument recorded February 27, 1979 as Fee No.
79-8026, Clackamas County Records.
ALSO EXCEPTING the Westerly 31 feet dedicated to the City of Wilsonville for
road purposes, said dedication parcel being more particularly described as
follows:
A tract of land in the South half of the Southwest quarter of Section 11,
Township 3 South, Range 1 West, of the Willamette Meridian, in the County of
Clackamas and State of Oregon, said tract being a portion of those tracts of
land conveyed to Xxxxxx X. Xxxxxxxx as recorded in Book 106, Page 316, Deed
Records and Xxxxx X. Xxxxxxxx, Xx., as recorded in Book 106, Page 317, Deed
Records; said tract is described as follows:
Beginning at a 5/8 inch iron rod on the North line of that 25.00 foot wide tract
of land conveyed to the City of Wilsonville, for road purposes, as recorded as
Recorder's Fee No. 72-33376, Film Records, said beginning point bears South
89(Degree)34'52" West 1330.42 feet and North 00(Degree)27'08" West 25.00 feet
from the quarter corner on the South line of Section 11, said beginning point
also being on the Easterly line of that Transmission Line Easement conveyed to
the United States of America as recorded in Book 522, Page 49, and in Book 515,
Page 231, Deed Records; thence North 00(Degree)27'08" West 1292.97 feet along
the East line of said easement to a 5/8 inch iron rod on the South line of that
tract of land conveyed to Xxxxxx X. Xxxxxxxx as recorded in Book 105, Page 454,
Deed Records; thence North 89(Degree)28'53" East 31.00 feet along the said South
line of the Xxxxxx Xxxxxxxx tract; thence south 00(Degree)27'08" East 1293.02
feet to the North line of the aforesaid City of Wilsonville tract; thence South
89(Degree)34'52" West 31.00 feet to the point of beginning.
EXHIBIT 1(b)
TRUST DEED
EXHIBIT 1(e)
NOTICE OF PUT OPTION EXERCISE
[Name and address of Stockholder(s)]
Dear [Name]:
Reference is made to that certain Property Option Agreement (the
"OPTION AGREEMENT") dated as of March __, 2002, by and between you and Fog
Cutter Capital Group Inc. (the "Company"). Capitalized terms used in this
notice, but not otherwise defined, will have the meanings assigned to such terms
in the Option Agreement.
1. EXERCISE OF OPTION. The Company hereby elects to exercise its option
to require you to purchase the Wilsonville Property at the Property Put Purchase
Price.
2. TENDER OF THE PURCHASE PRICE. You will cause the Property Put
Purchase Price to be delivered to the Company at the Put Option Closing, which
will take place at [time and place].
3. TENDER OF DEED. The Company will tender the Deed at the Put Option
Closing.
IN WITNESS WHEREOF, the Company has caused this Put Option Exercise
Notice to be executed as of the ____ day of _________, 200__.
FOG CUTTER CAPITAL GROUP INC.
By:
--------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: CEO
EXHIBIT 2(d)
NOTICE OF PUT OPTION EXERCISE
[Name and address of the Company]
Dear [Name]:
Reference is made to that certain Property Option Agreement (the
"OPTION AGREEMENT") dated as of March __, 2002, by and between the Stockholder
and Fog Cutter Capital Group Inc. (the "Company"). Capitalized terms used in
this notice, but not otherwise defined, will have the meanings assigned to such
terms in the Option Agreement.
1. EXERCISE OF OPTION. The Stockholder hereby elects to exercise its
option to put all of the Subject Shares to the Company at the Subject Shares Put
Purchase Price.
2. TENDER OF THE PURCHASED SHARES. The Stockholder will cause the
Subject Shares to be delivered to the Company at the Put Option Closing, which
will take place at [time and place].
3. TENDER OF PURCHASE PRICE. The Company will tender the Subject Shares
Put Purchase Price at the Put Option Closing.
IN WITNESS WHEREOF, the Stockholder(s) has caused this Put Option
Exercise Notice to be executed as of the ____ day of _________, 200__.
By:
------------------------------------
Name: Jordan X. Xxxxxxxxx, Individually
By:
------------------------------------
Name: Xxxxxx X. Xxxxx, Individually
