AGREEMENT OF PURCHASE AND SALE OF LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS between RESOURCE AMERICA, INC., as Seller, and RSI ASSOCIATES, LLC as Purchaser Dated as of: February ____, 2008
Exhibit 10.2
AGREEMENT
OF PURCHASE AND SALE
OF
LIMITED
LIABILITY COMPANY MEMBERSHIP INTERESTS
between
RESOURCE AMERICA,
INC.,
as
Seller,
and
RSI
ASSOCIATES, LLC
as
Purchaser
Dated as
of: February ____, 2008
AGREEMENT OF PURCHASE AND
SALE OF
LIMITED LIABILITY COMPANY
MEMBERSHIP INTERESTS
THIS
AGREEMENT OF PURCHASE AND SALE OF LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS
(“Agreement”)
is made and entered into this ______ day of February, 2008 by and between
RESOURCE AMERICA, INC., a Delaware corporation (“Seller”), and RSI
ASSOCIATES, LLC, a Delaware limited liability company (“Purchaser”).
RECITALS
A. Seller
is the owner of 100% of the membership interests in Resource RSI Phase 1, LLC, a
Delaware limited liability company (“RSI I”)and Resource
RSI Phase II, LLC, a Delaware limited liability company (“RSI II” and together
with RSI I, the ”Companies”).
B. RSI
I owns that certain parcel of real property located at ▇▇▇-▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, as more particularly described on Exhibit A attached
hereto (the “Phase I
Property”) and RSI II holds a leasehold interest in the 3rd, 4th and
5th
floors of that certain real property which is adjacent and contiguous to the
Phase I Property and located at ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ as more
particularly described on Exhibit B attached
hereto (the “Phase II
Property” and together with the Phase I Property, the “Property”).
C. Purchaser
desires to purchase and assume from Seller and Seller desires to sell and assign
a Thirty percent (30.00%) membership interest in each of RSI I and RSI II
constituting thirty percent (30%) of the membership interest in the Companies
and all rights, privileges and obligations attendant thereto (the “Acquired Interests”)
subject to and upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in
consideration of the premises and the mutual covenants hereinafter set forth,
Seller hereby agrees to sell and assign, and Purchaser hereby agrees to purchase
and assume, all of Seller's right, title and interest in the Acquired Interests
upon the following terms and conditions:
1. Purchase
Price. The purchase price for the Acquired
Interests shall be One Million Six Hundred Sixty Four Thousand One Hundred Sixty
Five and 49/100 Dollars ($1,664,165.49) (the “Purchase
Price”).
2. Payment of Purchase
Price. The Purchase Price shall be payable as
follows:
(a) On
the Initial Closing Date (as hereinafter defined), Purchaser shall acquire a
Nineteen and 99/100 percent (19.99%) membership interest in each of the
Companies (the “Initial Acquired
Interests”) upon the payment to Seller of One Million One Hundred Sixty
Four Thousand One Hundred Sixty Five and 49/100 Dollars ($1,164,165.49)which
shall be paid to Seller by cash, certified or bank check delivered at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇, Attn: ▇▇▇▇ ▇▇▇▇▇▇▇ or by wire transferred funds
to such account as Seller may designate; and
(b) On
the Second Closing Date (as hereinafter defined), Purchaser shall acquire an
additional Ten and 01/100 percent (10.01%) membership interest in each of the
Companies (the “Second
Acquired Interests”) upon the payment to Seller of Five Hundred Thousand
Dollars ($500,000) which shall be paid to Seller by cash, certified or bank
check delivered at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇, Attn: ▇▇▇▇ ▇▇▇▇▇▇▇ or
by wire transferred funds to such account as Seller may designate.
3. Time and Place of
Closing.
(a) Closing
on the Initial Acquired Interests (the “Initial Closing”)
shall take place at 10:00 A.M. Philadelphia, Pennsylvania time on the first
business day which is ten (10) days after notice of the proposed transfer is
delivered (the “Initial Closing
Date”) to the current holder of that certain loan in the original
principal amount of $12,500,000 initially made by Greenwich Capital Financial
Products, Inc. (“Lender”) and secured
by the Property (the “Loan”); and
(b) Closing
on the Second Acquired Interests (the “Second Closing”)
shall take place at 10:00 A.M. Philadelphia, Pennsylvania time on a date
mutually agreed upon by Seller and Purchaser after receipt of approval from
Lender by to the Companies (the “Second Closing Date”
and together with the Initial Closing Date, the “Closing
Dates”).
(c) Each
of the closings shall occur, at the Seller’s option, either (a) at the offices
of the Seller’s counsel or (b) through an escrow on terms acceptable to the
parties’ respective counsel, it being understood that if the Closing shall occur
through escrow, neither Purchaser, Seller nor their respective counsel need be
physically present at the Closing so long as (i) all documents that are required
to be delivered at Closing are fully executed, delivered in escrow and available
on the date of Closing, (ii) any authorized signatory of the affected party is
available either in person or by telephone and facsimile at Closing, and (iii)
the Purchase Price has been paid or wire transferred on or prior to
Closing.
4. Conditions to
Closing.
(a) Purchaser'
Conditions. Purchaser's obligation to pay the Purchase Price
and to acquire the Acquired Interests shall be subject to compliance by Seller
on or before the applicable Closing Date:
(i) execution
by Seller of an Assignment and Assumption of Partnership Interests in the form
of Exhibit C
(“Assignments of
Interests”) for each of RSI I and RSI II and delivery of such documents
to Seller’s counsel to be held in escrow until payment of the Purchase
Price;
(ii) such
other documents as may be reasonably required to consummate the transaction
contemplated by this Agreement; and
(iii) delivery
of a copy of the consent of the Lender.
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(b) Seller's
Conditions. Seller's obligation to sell the Acquired Interests
shall be subject to compliance by Purchaser with the following conditions
precedent on or by the applicable Closing Date:
(i) delivery
of the Purchase Price by Purchaser;
(ii) execution
by Purchaser of the Assignments of Interests and delivery of such documents to
Seller’s counsel to be held in escrow until payment of the Purchase Price;
and
(iii) such
other documents as may be reasonably required to consummate the transaction
contemplated by this Agreement.
(c) Conditions
Generally. The foregoing conditions are for the benefit only
of the parties for whom they are specified to be conditions precedent and such
parties may, in their sole discretion, waive any or all of such conditions and
close title under this Agreement without any increase in, abatement of or credit
against the Purchase Price.
5. Seller's Representations and
Warranties: Seller represents and warrants to Purchaser
that:
(i) Seller
is a corporation that has been duly
organized and is validly existing and in good standing under the laws of the
State of its organization.
(ii) Seller
has the full power, authority and legal right to enter into and perform this
Agreement subject to the terms of Section 21 below. The execution,
delivery and performance of this Agreement have been duly authorized by all
necessary legal action on the part of Seller. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby do not require any governmental or other consent and will not result in
the breach of any agreement, indenture or other instrument to which Seller is a
party or is otherwise bound.
(iii) Seller
has not filed any petition seeking or acquiescing in any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any law relating to bankruptcy or insolvency, nor has any such
petition been filed against Seller. Seller is not insolvent and the consummation
of the transactions contemplated by this Agreement shall not render Seller
insolvent. No general assignment of Seller’s property has been made for the
benefit of creditors, and no receiver, master, liquidator or trustee has been
appointed for Seller or any of its property.
(iv) Seller
owns and holds good, marketable and indefeasible title to the Acquired Interests
and now has, and will as of the Closing Date have, the authority to sell the
Acquired Interests free and clear of any liens, claims, charges or encumbrances
of any kind or character against such interests. Seller has not
previously assigned the Acquired Interests or any interest therein or portion
thereof to any other party, nor pledged, mortgaged or otherwise hypothecated the
Acquired Interests in favor of any other party. Upon the consummation of the
transfer of the Acquired Interests, Purchaser will receive good and absolute
title thereto, free from all liens, charges, encumbrances, restrictive
agreements and assessments whatsoever.
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(v) Each
of RSI I and RSI II has been duly organized and is validly existing and
subsisting under the laws of the state of its formation, with requisite power
and authority, and all rights, licenses, permits and authorizations,
governmental or otherwise, necessary to own its properties and to transact the
business in which it is now engaged. Each of RSI I and RSI II is duly
qualified to do business and is in good standing in each jurisdiction where it
is required to be so qualified in connection with its properties, business and
operations. Schedule 1 identifies
each document pursuant to which the Companies are organized or governed (“Organizational
Documents”).
(vi) The
execution and delivery of this Agreement and, upon receipt of the consent of the
Lender, the consummation of the transactions contemplated hereby will not result
in the breach of any agreement, indenture or other instrument to which the
Companies are a party or is otherwise bound upon receipt of the consent of the
Lender.
(vii) There
is no pending or, to the best of Seller’s knowledge, threatened litigation,
proceeding (including, without limitation, condemnation proceeding) or
investigation (by any person, governmental or quasi-governmental agency or
authority or otherwise) which might materially adversely affect the
Companies.
(viii) That
certain $12,500,000 mortgage loan (the “Mortgage Loan”) made
pursuant to that certain Loan Agreement dated June 30, 2006 between Greenwich
Capital Financial Products, Inc. and the Companies (the “Loan Agreement”) and
the other loan documents related thereto constitutes a legal, valid and binding
obligation of the Companies enforceable against the Companies in accordance with
their respective terms, subject to applicable bankruptcy, insolvency and similar
laws affecting rights of creditors generally, and general principles of
equity. To the best of Seller’s knowledge, the Companies are not in
default under the Mortgage Loan. The outstanding balance of the
Mortgage Loan as of January 29, 2008 is $12,335,834.51.
(ix) All
of the representations and warranties in this Agreement shall survive Closing
and shall be deemed to have been relied upon by Purchaser.
6. Purchaser's Representations
and Warranties. Purchaser represents and warrants to
Seller that:
(i) Purchaser
is a limited liability company that has been duly organized and is validly
existing under the laws of the state of its organization; Purchaser has full
power and right to enter into and perform its obligations under this Agreement
and the other closing documents contemplated herein to be executed and delivered
by it; and the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by all necessary
corporate acts and do not require any governmental or other
consent.
(ii) Purchaser
is fully aware that the Mortgage Loan is an obligation of the Companies and has
been provided with the Loan Agreement and all loan documents related
thereto.
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(iii) Except
as expressly set forth in this Agreement, Purchaser has not relied and will not
rely on, and neither Seller nor the Companies has made and is not liable for or
bound by, any express or implied warrants, guarantees, statements,
representations or information pertaining to the Property made or furnished by
Seller, the Companies, or any agent or third party representing or purporting to
represent Seller or the Companies, to whomever made or given, directly or
indirectly, orally or in writing.
(iv) Purchaser
is a knowledgeable, experienced and sophisticated purchaser of real estate and
that, except as expressly set forth in this Agreement, it is relying solely on
its own expertise in purchasing the Acquired Interests and shall make an
independent verification of the accuracy of any documents and information
provided by Seller or the Companies. Purchaser will conduct such
inspections and investigations of the Property as Purchaser deems necessary and
shall rely upon same.
(v) All
of the representations and warranties in this Agreement shall survive Closing
and shall be deemed to have been relied upon by Seller.
7. Interim
Operations. During the term of this Agreement, Seller shall or
shall cause the Companies, to the extent of its authority under the
Organizational Documents, to:
(a) not
create any lien or encumbrance upon or affecting title to the Acquired
Interests, and Seller shall not further mortgage, pledge, hypothecate or convey,
or perform any act which would result in an encumbrance of the Acquired
Interests, and
(b) not
solicit, accept or provide factual information or negotiate with respect to, any
offer to purchase the Acquired Interests from any person or entity other than
Purchaser or enter into any agreement, oral, written, contingent or otherwise
with any party (other than Purchaser) to sell the Acquired Interests or any
beneficial ownership interest therein.
8. Adjustments. Seller
and Purchaser agree to split any and all costs incurred in connection with
obtaining any required consents. For each closing after the
Initial Closing, the sole adjustment to the Purchase Price shall be that
Purchaser shall reimburse Seller for a portion of any reduction in the principal
balance of the Loan attributable to monthly payments computed by multiplying the
reduction in the principal balance of the loan by the percentage of interests of
each of the Companies acquired by Purchaser at such Closing (the “Amortization
Reimbursement”). By way of example, for the Second Closing the
Amortization Reimbursement shall be calculated by multiplying any reduction in
the principal balance by .1001. In the event that one party advances
the funds for the closing costs, the other will reimburse its share of such
costs.
9. Indemnification. Seller
and Purchaser each represent to the other that it did not deal with any broker
in connection with this transaction. Seller and Purchaser each
covenant and agree to indemnify and hold harmless the other party from and
against any and all costs, expenses, liabilities, claims, demands, suits,
judgments and interest, including, but not limited to, reasonable attorneys'
fees and disbursements, arising out of or in connection with any claim against
such party by any other broker or agent with respect to this Agreement, the
negotiation of this
Agreement or the transactions contemplated herein based upon the acts of the
indemnifying party. The provisions of this Section 9 shall
survive the Closing.
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10. Remedies.
(a) Seller's
Default. If Seller shall materially breach any covenant or
obligation or materially breach any representation or warranty set forth herein
(which default is not waived in writing by Purchaser), then Purchaser shall have
the right to (i) terminate this Agreement by giving Seller timely written notice
prior to Closing or (ii) enforce specific performance or (iii) waive said
failure or breach and proceed to Closing.
(b) Purchaser's
Default. If Purchaser breaches any covenant or obligation
herein or shall fail to close the transaction contemplated hereby without legal
excuse, then Seller’s sole remedy prior to the Initial Closing Date shall be to
declare this Agreement terminated by written notice to Purchaser and after the
Initial Closing Date Seller’s sole remedy shall be to terminate Purchaser’s
right to purchase the Second Acquired Interests.
11. Notices. All notices,
demands or other communications given hereunder shall be in writing and shall be
deemed to have been duly delivered (i) upon the delivery (or refusal to accept
delivery) by messenger or overnight express delivery service (or, if such date
is not on a business day, on the business day next following such date), or (ii)
on the second (2nd) Business Day next following the date of its mailing by
certified mail, postage prepaid, at a post office maintained by the United
States Postal Service, or (iii) upon the receipt by facsimile transmission as
evidenced by a receipt transmission report (followed by delivery by one of the
other means identified in (i)-(ii)), addressed as follows:
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If to
Seller:
|
Resource
RSI Phase 1, LLC
Resource
RSI Phase II, LLC
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇
▇▇▇▇▇▇▇
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
|
|
with
a copy to:
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Resource
Real Estate, Inc.
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
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|
If to
Purchaser:
|
RSI
Associates, LLC
▇▇▇
▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇
▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
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|
with
a copy to:
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Brandywine
Construction & Management, Inc.
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇ ▇▇▇▇▇▇▇▇, Esquire
Facsimile: (▇▇▇)
▇▇▇-▇▇▇▇
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Either party may, by notice given as
aforesaid, change the address or addresses, or designate an additional address
or additional addresses, for its notices, provided, however, that no notice of a
change of address shall be effective until actual receipt of such
notice. Either party may have it attorneys deliver notices to the
other party with the same force and effect as if given by the party represented
by such attorneys.
12. Choice of
Law. The interpretation, enforcement and performance of this
Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.
13. Miscellaneous.
(a) This Agreement
constitutes the entire agreement of the parties hereto and may not be modified
or canceled except pursuant to the terms hereof or an instrument in writing
signed by the parties hereto. The Schedules and Exhibits annexed
hereto are hereby incorporated herein by reference as fully as though set forth
herein.
(b) In
the event any dispute between the parties hereto results in litigation, the
prevailing party shall be reimbursed for all reasonable costs, including, but
not limited to, reasonable attorneys' fees.
(c) The
headings of the various Sections of this Agreement have been inserted only for
the purposes of convenience, are not part of this Agreement and shall not be
deemed in any manner to modify, explain, qualify or restrict any of the
provisions of this Agreement.
(d) This
Agreement may be executed in any number of counterparts with the same effect as
if all parties hereto had executed the same document. All such
counterparts shall be construed together and shall constitute one
instrument.
(e) This
Agreement shall bind and inure to the benefit of the respective heirs,
executors, administrators, personal representatives, successors and assigns of
the parties hereto; provided, however, that neither
party hereto shall assign this Agreement without the prior written consent of
the other party; and, provided, further, however, that Purchaser shall be
entitled, without the prior written consent of Seller, to assign this Agreement
to any affiliate of Purchaser and, upon any such assignment and the assumption
of this Agreement by a permitted assignee, Purchaser shall be released and
relieved from any and all obligations and liabilities hereunder. Any
assignment not permitted hereunder and undertaken without such prior written
consent shall be deemed null and void.
(f) Seller
and Purchaser agree that neither this Agreement nor any memorandum thereof shall
be recorded in any public records.
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(g) Each
of Seller and Purchaser shall provide to the other such further assurances as
may reasonably be required hereunder to effectuate the purposes of this
Agreement and, without limiting the foregoing, shall execute and deliver such
affidavits, certificates and other instruments as may be so required hereunder
so long as the same shall not in any manner increase the liability of the party
so executing and delivering said instrument.
(h) This
Agreement may not be changed or terminated orally by either party; it may be
amended only by a writing which is executed by Purchaser and
Seller. No course of conduct or course of dealing by the parties, or
failure by any of the parties hereto to insist upon or enforce any rights
herein, shall be construed to constitute a waiver, modification, or amendment of
any provision of this Agreement in the absence of a writing by each
party. No waiver of any breach hereunder shall be deemed to be a
waiver of any other or subsequent breach.
(i) All
references to a “Business Day” shall
mean any day which shall not be a Saturday, Sunday, legal holiday or day on
which banking institutions in the City of Philadelphia are authorized by law or
executive order to close. In the event the date on which a party is
required to take any action under the terms of this Agreement is not a Business
Day, the action shall be taken on the next succeeding Business Day
thereafter.
(j) Seller
and Purchaser each agree that only the Federal Courts of the United States
sitting in the Eastern District of Pennsylvania shall have exclusive
jurisdiction in respect of any legal action or proceeding brought against Seller
or Purchaser and arising out of or relating to this Agreement (“Proceedings”). In
connection with any such Proceeding, Seller and Purchaser each irrevocably
submits to the jurisdiction of the Federal Courts of the United States in the
Eastern District of Pennsylvania and waives any right of objection to the laying
of venue in any such court, including, without limitation, any objection on the
basis of inconvenient forum. Seller and Purchaser each irrevocably
agree to be bound by any final judgment rendered thereby in connection with this
Agreement from which no appeal has been taken or is available.
(k) THE
PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT THAT
EITHER PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THE PROPERTY, THE CLOSING
DOCUMENTS OR ANY OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH, OR IN RESPECT
OF ANY COURSE OF CONDUCT, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF
EITHER PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH OF THE PARTIES TO
ENTER INTO THE TRANSACTIONS DESCRIBED HEREIN.
14. Publicity. Seller
and Purchaser shall, prior to the Closing, maintain the confidentiality of this
transaction and shall not, except as required by law, court order or direction
of any governmental authority, disclose the terms of this Agreement or of such
sale and purchase to any third parties other than to Lender and their respective
employees, accountants, attorneys and agents, and such other persons whose
assistance is required in carrying out the terms of this Agreement, including,
without limitation, attorneys, appraisers, accountants, engineers, architects,
agents, consultants, contractors, and advisors. If Seller or Purchaser are
required by law, court order or any governmental authority to issue such a press
release or other public
communication concerning this Agreement prior to the Closing, Seller or
Purchaser, as applicable, shall deliver a copy of the proposed press release or
other public communication to the other parties for their review at least one
(1) Business Day prior to its issuance.
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15. Purchase
Option. In consideration for Ten Dollars ($10.00) and other
good and valuable consideration, Purchaser shall have the right to purchase (the
“Purchase
Option”) the remainder of Seller’s interests in the Companies as
follows:
(a) Option. Purchaser
shall have the right to purchase the remainder of the membership interests owned
by Seller , provided
that:
(i) Purchaser
must purchase the same percentage of membership interests in each of RSI I and
RSI II;
(ii) Purchaser
notifies Seller of its exercise of the Purchase Option in writing no later than
July 31, 2011;
(iii) Seller
has received any and all required consents under the loan documents governing
the Mortgage Loan for such transfer;
(iv) ▇▇▇▇▇▇
(as defined below) has failed to exercise its right of ROFR in the event that
Purchaser is purchasing a membership interest in an amount which would increase
its aggregate membership interest in the Companies to more than
49%;
(v) Seller
and Purchaser shall cooperate in good faith to obtain the necessary consents;
and
(vi) Seller
is released from liability under any guarantees given to the mortgage holder in
connection with the Mortgage Loan.
(b) ▇▇▇▇▇▇;
Definitions. RSI I hereby advises Purchaser that its
ownership interest in the Phase I Property is subject to a right of first
refusal (the “ROFR”) in favor of
the ▇▇▇▇▇▇ Trust (“▇▇▇▇▇▇”) pursuant to
the terms of that certain Agreement dated March ___, 1999. Under the
ROFR, if RSI I desires to sell the Phase I Property or any ownership interest in
RSI I which results in RSI I no longer holding majority ownership interest and
voting control, then ▇▇▇▇▇▇ has the right of first refusal for 45 days to
purchase the subject interests at the same terms.
(c) Purchase
Price. The purchase price for the membership interests subject
to the Purchase Option shall be $50,000 per 1.0% purchased (the “Option Purchase
Price”) and such sales shall be subject to the applicable terms provided
in Section 4 above. Seller and Purchaser agree to split any and all
costs incurred in connection with obtaining any required
consents. The sole adjustment to the Option Purchase Price
shall be Purchaser reimbursing Seller an amount equivalent attributable to the
Amortization Reimbursement for the membership interests being
purchased. Seller and Purchaser shall be responsible for its own
legal fees.
(d) Other
Sales. During the term of this Purchase Option, Seller shall
not offer for sale or sell its membership interests in the Companies to anyone
other than Purchaser, a Permitted Transferee or ▇▇▇▇▇▇ pursuant to its ROFR
unless Purchaser has delivered a written waiver and consent to Seller.
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16. Right of First
Offer. In the event that Purchaser has not purchased 100% of
the membership interests owned by Seller in the Companies, then from and after
August 1, 2011 Purchaser shall have a right of first offer (the
“ROFO”) to
purchase the balance of membership interests owned by Seller as
follows:
(a) If
Seller desires to transfer all or any portion of its membership interest in the
Companies, other than to a Permitted Transferee, then Seller shall be subject to
and required to comply with a right of first offer on the following terms and
conditions:
(i) Seller
shall notify Purchaser of such interest and include in the notice, the purchase
price and any other terms (the “ROFO
Terms”);
(ii) Purchaser
shall have the right and option to purchase the membership interests designated
in the notice by advising Seller in writing within 30 days after receipt of such
notice (which notice shall include all documentation concerning the prospective
transaction and is hereinafter referred to as the “ROFO Notice”);
(iii) If
Purchaser elects to purchase the membership interests, then the closing shall
occur on a date designated by Purchaser upon 10 days notice to Seller but not
later than 60 days after the date of Seller’s initial notice (unless the ROFO
Terms specify a later closing date) and shall such Closing shall be pursuant to
the ROFO Terms or as otherwise agreed upon by the parties;
(iv) If
Purchaser does not elect to purchase the membership interests or does not notify
Seller within the applicable time period in Section 16(a)(ii) above, the Seller
shall have the right to transfer the membership interests identified in the
notice free and clear of the ROFO right for one hundred and eighty (180) days
after Purchaser’s receipt of the ROFO Notice upon the ROFO Terms. If
Seller does not close such transaction within such one hundred and eighty (180)
day period or desires to sell any membership interests in the Companies on
materially different terms, Seller shall once again make a right of first offer
to Purchaser pursuant to the terms of this Section 16. Any membership
interests in the Companies not sold as provided above, shall be subject to this
right of first offer.
(b) For
purposes of Section 16 and 17 of this Agreement, “Permitted Transferees” include
any entity owned or controlled by Seller.
(c) Any
purchase pursuant to the ROFO shall comply with the following:
(i) Purchaser
must purchase the same percentage of membership interests in each of RSI I and
RSI II;
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(ii) Seller
has received any and all required consents under the loan documents governing
the Mortgage Loan for such transfer;
(iii) ▇▇▇▇▇▇
has failed to exercise its right of ROFR in the event that Purchaser is
purchasing a membership interest in an amount which would increase its aggregate
membership interest in the Companies to more than 49%;
(iv) Seller
and Purchaser shall cooperate in good faith to obtain the necessary consents;
and
(v) Seller
is released from liability under any guarantees given to the mortgage holder in
connection with the Mortgage Loan.
17. Tag Along
Rights. If Seller desires to sell its membership interests in
the Companies to a third party other than Purchaser or a Permitted Transferee
after July 31, 2011, Purchaser shall have the right to sell a pro rata amount of
its membership interests to the third party purchaser pursuant to the same terms
and conditions that Seller is selling its membership interests.
18. Rehabilitation of River
Street Inn. The parties acknowledge that the Property is in
the midst of being refurbished pursuant the budget attached hereto has Exhibit
D. The parties agree that $453,388.00 of the budget has not
been expended. Seller agrees to fund to the Companies without
contribution from the Purchaser such unexpended funds for repairs, improvements
and betterments to the hotel and Property as mutually agreed upon by Purchaser
and Seller.
19. Indemnity. Seller
agrees to indemnify Purchaser for Purchaser’s pro rata share of any liability
(such pro rata share being equal to the membership interests being purchased) of
the Companies accruing prior to the date of the respective Closing.
20. Operating
Agreements. The parties agree that the Companies’
Operating Agreements shall be amended concurrent with the Initial Closing to
provide as follows:
(a) For
so long as either party owns a minimum of nineteen and 99/100 percent (19.99%)
of the membership interests of the Companies, the Companies shall
not:
(i) borrow
money except in the ordinary course of business at commercially reasonable
terms;
(ii) defease
any debt and/or incur any prepayment penalty unless: (A) the term of the loan to
be paid off ends within one hundred and eighty (180) days after the payment
date; or (B) the party owning more than fifty percent (50%) of the membership
interests in the Companies (the “Majority Owner”) pays any such defeasance costs
and/or prepayment penalty;
11
(iii) lend
money;
(iv)
sell or transfer the Phase I or Phase II Property unless at any closing prior to
July 31, 2011 Purchaser shall receive sales proceeds equal at least to (A) any
capital contributions made by Purchaser to the Companies: and (B) the Purchase
Price and as applicable the Option Purchase Price paid by Purchaser for any
membership interests in the Companies;
(v) enter into or
amend any agreement or lease that would have a material adverse effect on the
Companies' business or property;
(vi) make
capital expenditures in excess of Ten Thousand Dollars
($10,000.00);
(vii) terminate
or amend the BCMI Management and Leasing Agreement (except for cause
pursuant to such agreement or as required by the Lender under the Loan
documents); and/or
(viii) initiate
(provided that if Seller and Purchaser are not able to reach an agreement on a
new manager after good faith efforts, the Majority Owner may make such decision
and cause the Companies to enter into the Agreement), terminate or amend any new
management agreement (except for cause pursuant to such agreement or as required
by the Lender under the Loan documents);
without
the consent of Seller and Purchaser.
(b) The
Companies shall distribute all available cash flow after retaining an annual
reserve of Fifty Thousand Dollars ($50,000.00).
20. Approval. This
Agreement is subject to the approval of Seller’s Board of Directors and Seller
agrees to attempt to obtain such approval within fourteen (14)
days.
21. Survival. The
provisions of Section 5, 6, 15, 16, 17, 18, 19, and 21 hereof shall survive the
closing of the purchase of the Acquired Interests hereunder.
[Remainder
of Page Intentionally Left Blank]
12
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed as
of the day and year first above written.
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SELLER:
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RESOURCE
AMERICA, INC.,
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a
Delaware corporation
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By: ________________________
Name:
Title:
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PURCHASER:
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RSI ASSOCIATES, LLC, a
Delaware limited liability company
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By: ________________________
▇▇▇▇
▇▇▇▇▇▇▇▇, Manager
13
EXHIBIT
A
Legal
Description of the Phase I Property
EXHIBIT
B
Legal
Description of the Phase II Property
EXHIBIT
C
Assignment
of Acquired Interests
ASSIGNMENT AND ASSUMPTION
OF
LIMITED LIABILITY COMPANY
MEMBERSHIP INTEREST
THIS
ASSIGNMENT AND ASSUMPTION OF LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST (this
“Assignment”)
is made this ____ day of ______________, 2008, by and between RESOURCE AMERICA,
INC. a Delaware corporation, as assignor (“Assignor”), and RSI
ASSOCIATES, LLC, a Delaware limited liability company (“Assignee”), as
assignee.
RECITALS
A. Assignor,
as seller, and Assignee, as buyer, have entered into that certain Agreement of
Purchase and Sale of Limited Liability Company Membership Interests (the “Agreement of Sale”)
dated February ____, 2008 to purchase and sell a ______ percent (____%)
membership interest (the “Membership Interest”)
in Resource RSI Phase ___, LLC, a Delaware limited liability company (the “Company”), as more
particularly described in the Agreement of Sale.
B. Assignor
desires to assign and set over to Assignee all of its right, title and interest
in and to the Membership Interest and any other rights of Assignor with respect
thereto, in its capacity as a member of the Company, under that certain Limited
Liability Company Agreement dated June 30, 2006 ( “LLC
Agreement”).
C. Assignee
desires to assume and be responsible for all of Assignor’s obligations with
respect to the Membership Interest and any other obligations of Assignor, in its
capacity as a member of the Company, under the LLC Agreement.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Assignor and Assignee agree as
follows:
1. Assignor
assigns, sets over and transfers to Assignee all of its right, title and
interest in and to the Membership Interest and any and all rights as a member in
connection therewith under the LLC Agreement.
2. Assignee
hereby assumes all of Assignor’s right, title and interest to the Membership
Interest and agrees to be responsible for all of the obligations of
Assignor, in its
capacity as a member of the Company in connection therewith, and to be legally
bound by and subject to all of the terms the LLC Agreement.
3. This
Assignment shall be binding on the parties hereto and their successors and
assigns.
IN
WITNESS WHEREOF, intending to be legally bound, Assignor and Assignee have
caused this Assignment to be executed by their duly authorized officers on the
day and year first above written.
ASSIGNOR:
RESOURCE
AMERICA, INC., a Delaware corporation
By: _____________________________
Name:
Title:
ASSIGNEE:
RSI
ASSOCIATES, LLC
By ____________________________
▇▇▇▇ ▇▇▇▇▇▇▇▇, Manager
EXHIBIT
D
Budget
Schedule
1
Organizational
Documents
Resource RSI Phase I,
LLC.
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1.
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Certificate
of Limited Partnership filed with the Pennsylvania Department of State on
June 27, 2006
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2.
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Limited
Liability Company Agreement dated June 30,
2006
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Resource RSI Phase II,
LLC.
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1.
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Certificate
of Limited Partnership filed with the Pennsylvania Department of State on
June 27, 2006
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2.
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Limited
Liability Company Agreement dated June 30,
2006
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