Exhibit 10.2
OPTION AGREEMENT
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THE SOUTH STREET BAKERY, INC.
and
CLEAR LAKE SPECIALTY PRODUCTS, INC.
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Dated as of August 12, 2011
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SCHEDULES
Schedule 2.1(a) The Assets
Schedule 2.2(b) Exercise Price Allocation
Schedule 2.4 Assumed Obligations
Schedule 4.3 No Conflict; Required Filings and Consents
Schedule 4.4 Absence of Certain Changes
Schedule 4.5 Litigation
Schedule 4.6 Liens on Assets
Schedule 4.7 Licenses, Permits, Consents
Schedule 4.9 Environmental Matters
Schedule 4.11 Finder's Fee
Schedule 4.13 Real Property
Schedule 4.14 Taxes
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OPTION AGREEMENT
OPTION AGREEMENT (THE "AGREEMENT"), dated this 12th day of August, 2011 by
and among THE SOUTH STREET BAKERY, INC., a Delaware corporation ("SSB"), CLEAR
LAKE SPECIALTY PRODUCTS, INC., an Iowa corporation (THE "COMPANY"), and ▇▇▇▇▇
PROPERTIES, LLC, an Iowa limited liability company, (THE "STOCKHOLDER").
RECITALS
WHEREAS, the Company desires to grant to SSB, and SSB desires to receive
from the Company, an option to purchase the Assets (as hereinafter defined)
owned by the Company and used in connection with the business of baking,
packaging and distributing baked cookies and other related baked products; and
WHEREAS, The parties desire to enter into this Agreement to specify their
respective rights, duties, covenants and agreements relating to the exercise of
the option on the terms provided herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants,
representations, warranties and agreements hereinafter set forth, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
When used herein, the following terms shall have the meanings set forth
below:
(a) "AFFILIATE" of a party means any entity which directly or indirectly
controls, is controlled by or is under common control with such party. The term
"control" means the power to direct the affairs of such entity by reason of
ownership of equity securities, by contract or otherwise.
(b) "ASSETS" means the property, plant, equipment and assets, tangible and
intangible, of the Company described in Section 2.1 to be conveyed to SSB.
(c) "CONTRACTS" means any contract, agreement, lease, license, arrangement,
commitment, sales order, purchase order or any claim or right or any benefit or
obligation arising thereunder or resulting therefrom and currently in effect,
whether oral or written.
(d) "KNOW-HOW" means any and all baking knowledge, proprietary rights,
patented or unpatented inventions, trade secrets, analytical methodology,
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processes, data and all other information or experience possessed by the
Company, or which the Company has the right to use.
(e) "LIABILITIES" means any direct or indirect liability, indebtedness,
claim, loss, damage, deficiency, obligation or responsibility, fixed or unfixed,
▇▇▇▇▇▇ or inchoate, liquidated or unliquidated, secured or unsecured, accrued,
absolute, known or unknown, contingent or otherwise.
(f) "LIEN" means any mortgage, lien, pledge, charge, security interest,
license, lease, claim, restriction, option or encumbrance of any kind.
(g) "INTELLECTUAL PROPERTY" means (i) all registered or unregistered trade
names and trade and service marks and applications and licenses therefor, (ii)
all writings for which copyright is claimed, has been recorded or is pending,
(iii) all recipes, ingredients for all products and (iv) all other trade rights
and all agreements relating to Know-how which the Company is licensed or
authorized to use by others or which the Company licenses or authorizes others
to use.
(h) "REAL PROPERTY PERMITTED LIENS" those restrictions, reservations,
covenants, limitations and conditions described on SCHEDULE 1.1 hereto.
(i) "REGULATED SUBSTANCES" means any substance regulated under
Environmental Laws, including but not limited to hazardous waste, as defined
pursuant to Resource Conservation Recovery Act ("RCRA"), hazardous substances,
as defined pursuant to Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), toxic substances as defined under Toxic Substances
Control Act ("TSCA"), hazardous materials, as defined under the Hazardous
Materials Transportation Act, petroleum and its fractions, asbestos containing
materials ("ACM") and polychlorinated biphenyl's ("PCB").
(j) "TAX" or "TAXES" mean any tax, charge, deficiency, duty, fee, levy,
toll or other amount (including, without limitation, any net income, gross
income, profits, gross receipts, excise, property, sales, ad valorem,
withholding, social security, retirement, excise, employment, unemployment,
minimum, alternative, add-on minimum, estimated, severance, stamp, occupation,
environmental, premium, capital stock, disability, windfall profits, use,
service, net worth, payroll, franchise, license, gains, customs, transfer,
recording, registration or other tax) assessed or otherwise imposed by any
governmental entity or under applicable law, together with any interest,
penalties or any other additions or increases.
(k) "TAX RETURN" means any return or report, including any related or
supporting information, with respect to Taxes.
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ARTICLE II
OPTION TO PURCHASE ASSETS
AND ASSUMPTION OF OBLIGATIONS
2.1 GRANT OF OPTION TO PURCHASE THE COMPANY'S ASSETS.
(a) Upon the terms and subject to the conditions of this Agreement, the
Company hereby grants to SSB an irrevocable option (the "OPTION") to enable SSB
to acquire from the Company, on terms and in an amount determined pursuant to
this Agreement and on the basis of an aggregate price equal to the Exercise
Price (as defined in Section 2.2), in accordance with the terms and conditions
set forth herein, all of the Company's right, title and interest in and to all
of the property, plant and assets, as set forth herein or listed in Schedule
2.1(a) (THE "ASSETS"), including, without limitation:
(i) the Company's property and plant located at Lots 9, 10, 11 &12 in
the Clear Lake Industrial Park, the improvements being known as ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "PROPERTY");
(ii) all goodwill relating to the Assets;
The Assets shall be conveyed free and clear of all Liabilities and
Liens, except those Liabilities which are expressly to be assumed by SSB
hereunder.
(b) Provided that SSB is not in default under the Lease Agreement (as
defined herein), the Option may be exercised at any time beginning on the date
hereof and ending at 5:30 p.m. New York City time on August 11, 2012 (the
"OPTION PERIOD") by delivery by SSB of written notice to the Company (the
"EXERCISE NOTICE"). If the Company does not receive the Exercise Notice prior to
the expiration of the Exercise Period, the Option shall expire and this
Agreement shall be terminated.
2.2 EXERCISE PRICE; ALLOCATIONS.
(a) The Exercise Price for the Option and the purchase of the Assets shall
be $3,607,000 less any payments made by SSB to the Company pursuant to this
Section 2.2 which shall be credited towards the Exercise Price (THE "EXERCISE
PRICE"):
(i) in consideration of the grant of the Option, SSB is paying to the
Company $275,000 in cash upon the execution of this Agreement (the "OPTION
PAYMENT");
(ii) any principal and interest payments made by SSB pursuant to that
certain Lease Agreement, dated August 12, 2011 by and among SSB, the
Company and the Stockholder (the "LEASE AGREEMENT"), a copy of which is
attached hereto as Exhibit A, with such lease payments to be applied
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towards the remaining debt payments due on those certain Series 2006
Variable Rate Demand Development Revenue Bonds (the "2006 REVENUE Bonds")
and provided that SSB is approved for such assumption of the 2006 Revenue
Bonds debt payments by Manufacturers and Traders Trust Company ("M&T"), any
agreement authorizing said assumption of the 2006 Revenue Bonds shall
include a release of ▇▇▇▇▇'▇ Wholesale Pizza, Inc. from any guarantee or
liability for the 2006 Revenue Bonds; provided, however if such release is
not reasonably practicable, the parties hereto agree in good faith to use
commercially reasonable efforts to fulfill the terms of this Agreement;
(iii) any profit participation payments made by SSB pursuant to the
Lease Agreement ("PROFIT PAYMENTS"), with such Profit Payments to be
applied to the principal portion of the 2006 Revenue Bonds in the month
received and to be reflected on the next monthly statement provided by
Company;
(iv) any additional payments made at the discretion of SSB, with the
consent of the Company, which consent shall not be unreasonably withheld,
shall be applied towards the principal balance outstanding on the 2006
Revenue Bonds.
By way of example:
Exercise Price $3,607,000
Option Payment $ (275,000) at Closing
Balance at Closing $3,332,000
2011 5 Monthly Principal Payments $ (37,500)*
2012 7 Monthly Principal Payments $ (64,166)*
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BALANCE DUE ON AUGUST 11, 2012 $3,218,333
* Assumes $7,500 of monthly Lease Payment in 2011 goes towards principal and
$9,166.57 of montly Lease Payment in 2012 goes towards principal.
(b) SSB and the Company agree that the Exercise Price shall be allocated in
the manner set forth on Schedule 2.2(b). The Company and SSB shall each file any
required reports in accordance with Section 1060 of the Internal Revenue Code of
1986, as amended (THE "CODE"), and the regulations promulgated thereunder and
shall prepare their respective Federal, state and local tax returns in a manner
consistent with such allocation.
2.3 INSTRUMENTS OF CONVEYANCE AND TRANSFER. On the Closing Date, the
Company shall deliver to SSB (i) the instruments of transfer listed in Article
VII and such other good and sufficient instruments of conveyance and transfer,
in form reasonably satisfactory to all parties hereto, as shall be effective to
vest in SSB all right, title and interest in the Assets, subject to no Liens,
(ii) all of the Contracts, books, records and other data relating to the Assets
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and, simultaneously with such delivery, shall deliver to SSB actual possession
and control of the Assets and (iii) SSB shall pay any sales or recordation fees
or taxes related to the purchase of the Assets.
2.4 ASSUMPTION OF CERTAIN OBLIGATIONS. In addition to the purchase of the
Assets, on the Closing Date, SSB shall assume, pay, perform and discharge the
Company's Liabilities set forth on Schedule 2.4 (THE "ASSUMED OBLIGATIONS").
Except for the Assumed Obligations, SSB shall not assume or be or become liable
for any Liabilities of the Company not specifically agreed to be assumed herein,
and the Company shall remain liable to perform and discharge such Liabilities.
2.5 ASSIGNMENT OF CONTRACTS. Anything in this Agreement to the contrary
notwithstanding, this Agreement shall not constitute an agreement to assign any
Contracts, or any benefit arising thereunder or resulting therefrom, if an
attempted assignment thereof, without the consent of a third party thereto,
would constitute a material breach thereof or in any way materially affect the
rights of SSB or the Company thereunder. If such consent is not obtained, or if
an attempted assignment thereof would be ineffective or would materially affect
the rights of SSB or the Company, the Company shall cooperate with SSB in any
reasonable arrangement designed to provide for SSB to enjoy the benefits under
any such Contracts, including, without limitation, enforcement for the benefit
of SSB of any and all rights of the Company under such Contracts.
2.6 FURTHER ASSURANCES. From time to time after the Closing, the Company
shall execute and deliver such other instruments of transfer and documents
related thereto and take such other action as SSB may reasonably request in
order to more effectively transfer to SSB, and to place SSB in possession and
control of, the Assets, or to enable SSB to exercise and enjoy all rights and
benefits of the Company with respect thereto. SSB shall take such actions as the
Company may reasonably request in order to assure SSB's assumption of the
Assumed Obligations.
2.7 FUTURE DISCOVERY OF ASSETS. If, at any time following the Closing Date,
the Company locates or discovers any Assets set forth or required to be set
forth in Schedule 2.1(a) that were not transferred to SSB on the Closing Date,
the Company agrees to promptly notify SSB of such location or discovery and to
take all such action necessary to deliver actual possession and control of such
Assets.
2.8 SUPPLEMENTS TO SCHEDULES. The Company and the Stockholder shall deliver
to SSB, as soon as possible, but not later than at the Closing, supplemental
information updating the information set forth in the Schedules, so that such
Schedules supplemented by such information will be true and correct at the
Closing as if then made.
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ARTICLE III
SETTLEMENT OF OPTION: CLOSING
Subject to the satisfaction of the conditions set forth in Article VII, the
closing (THE "CLOSING") of the transactions contemplated hereby shall take place
of the 30th day after the delivery of the Exercise Notice. The time and date of
the Closing is referred to herein as the "CLOSING DATE". At the Closing, in
addition to the sale and transfer of the Assets, there shall be delivered by the
parties hereto such certificates, opinions and other documents as are specified
in Article VII hereof. The Closing Date shall be extended until the deliveries
set forth in Article VII have been made. The parties agree, in good faith (i)
not to take any action (or fail to take any action) that unreasonably delays the
Closing Date and (ii) to use commercially reasonable efforts hold the Closing on
the Closing Date or as soon as practicable thereafter.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF COMPANY AND STOCKHOLDER
The Company and the Stockholder jointly and severally represent and warrant
to, and agree with, SSB as follows:
4.1 ORGANIZATION. (a) The Company is a corporation and the Stockholder is a
limited liability company, both of which are duly organized, validly existing
and in good standing under the laws of the State of its jurisdiction of
incorporation or formation and has all requisite corporate power and authority
to own, lease and operate its properties and to carry on its business as now
being conducted. The Company and the Stockholder have heretofore delivered to
SSB true, accurate and complete copies of the Certificate of Incorporation or
Formation, By-Laws and Limited Liability Company Agreement of the Company and
the Stockholder as in effect on the date hereof. Neither the Company nor the
Stockholder is not in violation of any of the provisions of its Certificate of
Incorporation, By-Laws, Certificate of Formation or Limited Liability Company
Agreement.
(b) The Company has no subsidiaries or affiliated companies and does not
otherwise own any shares of stock or any interest in, or control, any other
corporation, partnership or business entity.
4.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Each of the Company and the
Stockholder has full power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly and validly authorized by the Board of Directors and the
stockholder of the Company and the members and/or governing body of the
Stockholder. No other proceedings, corporate or otherwise, on the part of the
Company or the Stockholder are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
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and validly executed and delivered by the Company and the Stockholder and
constitutes the valid and binding agreement of each of them, enforceable against
each of them in accordance with its terms.
4.3 NO CONFLICT; REQUIRED FILINGS AND CONSENTS. (a) Except as set forth in
Schedule 4.3, the execution and delivery of this Agreement by the Company and
the Stockholder do not, and the consummation of the transactions contemplated
hereby will not, (i) conflict with or violate any law, regulation, court order,
judgment or decree applicable to the Company or the Stockholder or by which the
Assets are bound or affected, (ii) violate or conflict with the Certificate of
Incorporation or By-Laws of the Company or the Certificate of Formation or
Limited Liability Company Agreement of the Stockholder, or (iii) result in any
breach of or constitute a default (or an event which with notice or lapse of
time or both would become a default) under, or give to others any rights of
termination or cancellation of, or result in the creation of a Lien on any of
the Assets pursuant to any Contract, permit, license or franchise to which the
Company or any of the Assets is bound or affected, except for conflicts,
violations, breaches or defaults which, in the aggregate, would not have a
material adverse effect on the business, operations, Assets, Liabilities or
condition (financial or otherwise) (A "MATERIAL ADVERSE EFFECT") on the Company
or the ability of the Company or the Stockholder to complete the transactions
contemplated hereby.
(v) Except as set forth in Schedule 4.3, neither the Stockholder nor the Company
is required to submit any notice, report or other filing with any governmental
authority, domestic or foreign, in connection with the execution, delivery or
performance of this Agreement. No waiver, consent, approval or authorization of
any person or any governmental or regulatory authority, domestic or foreign, is
required to be obtained or made by the Company or the Stockholder in connection
with its execution, delivery of this Agreement or the consummation of the
transactions contemplated hereby.
4.4 ABSENCE OF CERTAIN CHANGES. Except as set forth in Schedule 4.4, the
Company has not:
(A) mortgaged, pledged or subjected to Liens, or agreed to do so, any
of the Assets or the Property;
(B) sold or transferred, or agreed to sell or transfer, any of the
Assets or the Property.
4.5 LITIGATION. Except as set forth in Schedule 4.5, no investigation or
review by any governmental entity or regulatory body, foreign or domestic, with
respect to the Assets is pending or, to the knowledge of the Company or the
Stockholder, threatened against the Company and no governmental entity or
regulatory body has advised the Company of an intention to conduct the same and
no service of process has been provided to the Company. Except as set forth in
Schedule 4.5, there is no claim, action, suit, investigation or proceeding
pending or, to the knowledge of the Company or the Stockholder, threatened
against or affecting the Company at law or in equity or before any Federal,
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state, municipal or other governmental entity or regulatory body, or which
challenges the validity of this Agreement or any action taken or to be taken by
the Company pursuant to this Agreement and no service of process has been
provided to the Company. As of the date hereof, the Company is not subject to,
nor is there in existence, any outstanding judgment, award, order, writ,
injunction or decree of any court, governmental entity or regulatory body
relating to the Company and no service of process has been provided to the
Company.
4.6 ASSETS. The Company has good and marketable title to, or valid
leasehold interests in, the Assets, free and clear of any Liens, other than
Liens listed in Schedule 4.6 and Liens for taxes not yet due and payable. All of
the Assets and Property owned or leased by the Company are in all material
respects in good condition and repair, ordinary wear and tear excepted, and well
maintained.
4.7 LICENSES, PERMITS AND CONSENTS; COMPLIANCE WITH APPLICABLE LAW. (a) The
licenses and permits set forth in Schedule 4.7 are the only licenses and permits
which individually or in the aggregate are material to the conduct of the
business of the Company or any employee of the Company by reason of such
employee's activities on behalf of the Company under applicable law or by any
Federal, state, local or foreign governmental entity or regulatory body for the
operation of the business of the Company, and all of such listed licenses and
permits are in full force and effect as of the date hereof. The Company has not
received notice and, to the knowledge of the Company and the Stockholder, there
is no reason to believe, that any appropriate authority intends to cancel or
terminate any of such licenses or permits or that valid grounds for such
cancellation or termination currently exist.
(b) The Company shall use all reasonable best efforts and fully cooperate
with SSB in transferring and/or assigning the licenses and permits set forth on
Schedule 4.7 into the name of SSB.
4.8 [INTENTIONALLY OMITTED]
4.9 ENVIRONMENTAL MATTERS. Except as set forth in Schedule 4.9, the
business of the Company is and has been being conducted in compliance with all
applicable Federal, state, local and foreign laws and regulations relating to
the protection of the environment. The Company has not released, emitted, buried
or otherwise disposed of Regulated Substances on the Company's properties. To
Company's knowledge, no one else has released, emitted, buried or otherwise
disposed of Regulated Substances on any of Company's Properties. Except as set
forth on Schedule 4.9, no storage tanks, underground or otherwise, are or have
been located on any of the Company's Properties. The Company has complied with
all environmental laws relating to its operations or the Company's properties.
Except as set forth on Schedule 4.9, there are no ACM's, PCB's or radioactive
substances located on Company's Properties. Except as set forth on Schedule 4.9,
the Company has not received any notice, demand, claim or information request
pursuant to CERCLA or any comparable state law. Except as set forth on Schedule
4.9, neither the Company nor the Stockholder has knowledge of any other party's
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receipt of any notice, demand, claim or information request pursuant to CERCLA
or any comparable state law relating to any of Company's Properties or any
property where Company's wastes were sent. Except as set forth on Schedule 4.9,
none of Company's properties is listed on any regulatory list of contaminated
properties, including but not limited to the National Priorities List
promulgated pursuant to CERCLA, or any federal, state or local counterpart. The
Company has no existing or potential Liability under any Environmental Laws. No
environmental approvals, clearances or consents are required under applicable
law from any governmental authority or authority in order for SSB and the
Company to consummate this acquisition or for SSB to continue the business of
Company after the Closing. To the Company's and the Stockholder's knowledge,
there are no conditions on any properties adjacent to Company's properties which
threaten property leased by the Company. Except as set forth on Schedule 4.9,
the Company is not required to have, nor does it have, any permits issued under
any environmental laws. The Company has disclosed, prior to the date of this
Agreement, its waste practices, its use of Regulated Substances and all
potentially material environmental matters, and has disclosed all reports,
assessments, remedial action plans or other similar documents relating to any
environmental condition, whether or not material, of Company's properties or
operations. Nothwithstanding the foregoing, the Company and Stockholder shall
not be liable for any Environmental Matters or other acts not caused by Landlord
(as defined in the Lease Agreement) reasonably determined to have occurred after
the commencement of the Lease Agreement.
4.10 [INTENTIONALLY OMITTED]
4.11 FINDER'S FEE. Except as set forth on Schedule 4.11, there is no
investment banker, broker, finder or other intermediary which has been retained
by, or is authorized to act on behalf of, the Company, the any Stockholder or
their respective Affiliates who might be entitled to any fee or commission from
SSB or its Affiliates in connection with the consummation of the transactions
contemplated hereby.
4.12 [INTENTIONALLY OMITTED]
4.13 REAL PROPERTY. (a) Schedule 4.13 contains a complete and accurate
description in all material respects of the Property. The Company does not lease
any other real property. The Property comprises all real property interests used
in the conduct of the business and operations of the Company as now conducted.
The Company has good and indefeasible fee simple title to, and the right to
quiet enjoyment of, the Property, free and clear of all Liens, except Real
Property Permitted Liens. Except as set forth on Schedule 4.13, there are no
leases, subleases, licenses or other agreements for the use or occupancy of any
portion of the Property by any Person other than the Company. There are no
delinquent Taxes relating to the Property. There are no outstanding purchase
options or rights of first refusal/offer for, or other contractual rights to
purchase, acquire, sell or dispose of, any portion of the Property, or any
interest in the Property, in favor of any third party other than the Company.
Neither the Stockholder nor the Company have received written notice of, and
neither the Stockholder nor the Company has any knowledge of, any pending or
proposed condemnation or eminent domain proceedings affecting the Property.
There are no capital improvements or capital repairs pending or in progress at
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the Property, including to any buildings and other improvements and facilities
located thereon, all structural and non-structural components thereof, and all
related heating, cooling, ventilation, plumbing, sprinkler, electrical and other
building systems, all of which are in good working order and repair, and, to the
Stockholder's or the Company's knowledge, there are no capital improvements or
capital repairs necessary to any of the foregoing.
(b) The Property is assessed for real estate tax purposes as a wholly
independent tax lot, separate from any adjoining land or improvements not
constituting a part of such parcel. Schedule 4.13 attached hereto includes a
copy of the most recent tax ▇▇▇▇ of each taxing authority for the Property. No
tax certiorari or other tax reduction proceedings are pending regarding the
Property. There is no pending or contemplated reassessment of the Property.
(c) No money is owed to any architect, contractor, subcontractor or
materialman for labor or materials performed, rendered or supplied to or in
connection with the Property. There is no work being done at or materials being
supplied to the Property at the date hereof other than routine maintenance
projects having an aggregate cost through completion of not more than $10,000.
4.14 TAXES. Except as set forth on Schedule 4.14:
(A) The Company has filed all Tax Returns that it was required to file and
has paid or withheld all Taxes due and owing. All such Tax Returns were correct
and complete in all material respects..
(B) The Company has not agreed to any extension or waiver of the statute of
limitations applicable to any Tax Return, or agreed to any extension of time
with respect to a Tax assessment or deficiency, which period (after giving
effect to such extension or waiver) has not yet expired.
(C) The Company is not a party to any Tax allocation or sharing agreement.
(D) There are no Liens for unpaid Taxes on the assets of the Company
payable.
(E) To the best of their respective knowledge, there is no action, suit or
proceeding currently pending or, to the Stockholder's or the Company's,
threatened with respect to the Company in respect of any Tax.
(F) The Company (i) has not been a member of an affiliated group of
corporations within the meaning of Section 1504 of the Code (other than a group
the common parent of which is the Company) or (ii) has no liability for Taxes of
any Person (other than the Company) under Treasury Regulation Section 1.1502-6
(or any similar provision of state, local or foreign Law), as a transferee or
successor or by Contract.
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(G) The Company has not received notice of any claim by or any
questionnaire from any taxing authority in a jurisdiction where the Company does
not file Tax Returns indicating that it is or may be subject to taxation by that
jurisdiction.
(H) The Company will not be required to include any item of income in, or
exclude any item of deduction from, taxable income for any taxable period (or
portion thereof) ending after the Closing Date as a result of any: (i) change in
method of accounting for a taxable period ending on or prior to the Closing
Date, (ii) "closing agreement" described in Section 7121 of the Code (or any
corresponding or similar provision of state, local or foreign Tax law) executed
prior to the Closing Date, (iii) installment sale made prior to the Closing
Date, (iv) prepaid amount received prior to the Closing Date, or (v) pursuant to
an election under Section 108(i) of the Code made prior to the Closing Date.
(I) The Company has not engaged in any listed transaction within the
meaning of Section 6706A(c)(2) of the Code, or participated in or cooperated
with an international boycott within the meaning of Section 999 of the Code.
4.15 [INTENTIONALLY OMITTED]
4.16 ACCURACY OF REPRESENTATIONS. The representations and warranties made
by the Company and the Stockholder in this Agreement, and in any certificate or
schedule referenced hereby or attached hereto, do not contain, and will not
contain, any statement which is false or misleading with respect to any material
fact and do not and will not omit to state a material fact required to be stated
herein or therein or necessary in order to make the statements contained herein
or therein not materially false or misleading.
ARTICLE V
REPRESENTATIONS AND
WARRANTIES OF SSB
SSB represents and warrants to, and agrees with, the Company as follows:
5.1 ORGANIZATION. SSB is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as now being conducted.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. SSB has full corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by the Board of Directors of SSB and no other corporate
proceedings on the part of SSB are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by SSB and constitutes a valid and binding
agreement, enforceable against it in accordance with its terms.
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5.3 NO CONFLICT; REQUIRED FILINGS AND CONSENTS. (a) The execution and
delivery of this Agreement by SSB do not, and the consummation of the
transactions contemplated hereby will not, (i) conflict with or violate any law,
regulation, court order, judgment or decree applicable to SSB or by which its
properties are bound or affected, (ii) violate or conflict with either the
Certificate of Incorporation or By-Laws of SSB or (iii) result in any breach of
or constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any right of termination or
cancellation of, or result in the creation of a Lien on any of the properties of
SSB pursuant to any Contract to which SSB is a party or by which SSB or any of
its properties is bound or affected.
(b) SSB is not required to submit any notice, report or other filing with
any governmental entity or regulating body, domestic or foreign, in connection
with the execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby. No waiver, consent,
approval or authorization of any governmental entity or regulatory body,
domestic or foreign, is required to be obtained or made by SSB in connection
with its execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby.
5.4 FINDER'S FEE. There is no investment banker, broker, finder or other
intermediary which has been retained by, or is authorized to act on behalf of,
SSB or its Affiliates who might be entitled to any fee or commission from the
Company, the Stockholder or their respective Affiliates upon the consummation of
the transactions contemplated hereby or thereafter.
5.5 ACCURACY OF REPRESENTATIONS. The representations and warranties made by
SSB in this Agreement, and in any certificate or schedule referenced hereby or
attached hereto, do not contain, and will not contain, any statement which is
false or misleading with respect to any material fact and do not and will not
omit to state a material fact required to be stated herein or therein or
necessary in order to make the statements contained herein or therein not
materially false or misleading. The representations and warranties made in this
Agreement shall survive for a period of eighteen (18) months from the date of
the Lease Agreement; provided, however the representation set forth in Section
4.6-The Assets shall survive for the applicable statute of limitations for
contracts.
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ARTICLE VI
COVENANTS
6.1 CONDUCT OF BUSINESS OF THE COMPANY. From the date hereof to the Closing
Date, the Company shall, and the Stockholder shall use its best efforts to cause
the Company to, except to the extent compliance with this Section 6.1 is waived
in writing by SSB:
(a) not conduct any business except for its rights and obligations as
lessor under the Lease Agreement;
(b) use its best efforts to keep in full force and effect insurance
comparable in amount and scope of coverage to that now maintained by it;
(c) use its best efforts to comply with all laws and regulations applicable
to it and to the conduct of its business;
(d) not merge or consolidate with, or purchase substantially all of the
assets of, or otherwise acquire, any person or entity;
(e) comply with all of its obligations with respect to the 2006 Revenue
Bonds and all agreements related thereto;
(f) not incur any indebtedness for borrowed money or issue any debt
securities or create or cause to be created any Lien on the Assets;
(g) not enter into any leases other than the Lease Agreement;
(h) promptly advise SSB in writing of any material adverse change and any
event (other than events generally known to the public) which would reasonably
be expected to result in such a change, including any default or event which,
with the giving of notice, lapse of time, or both, would result in an event of
default with respect to the 2006 Revenue Bonds;
(i) not sell, transfer or otherwise dispose of, or agree to sell, transfer
or otherwise dispose of, any of the Assets, without the express written consent
of SSB;
(j) not enter into any other Contracts affecting in any way the Assets;
(k) not enter into or modify any Contract with respect to any of the
foregoing;
(l) not enter into any agreement to do any of the things prohibited in
clauses (a) - (l) above;
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(m) not be in violation or breach of any material provision of this
Agreement, and the business and operations of the Company shall comply in all
material respects and are being conducted in accordance with, all governing
laws, regulations and ordinances applicable thereto and the Company is not in
violation of or in default under, any judgment, award, order, writ, injunction
or decree of any court, arbitration tribunal, governmental entity or regulatory
body.
6.2 NO SOLICITATION. The Company and the Stockholder shall not, and shall
direct and otherwise use their respective best efforts to cause their respective
officers, directors, partners, financial advisors, counsel, agents and
Affiliates not to, (i) directly or indirectly solicit, encourage or facilitate
(including by way of furnishing any non-public information concerning the
Company) the submission of proposals or offers from any person other than SSB or
its Affiliates thereof relating to any acquisition or purchase of all or a
material part of the stock or assets of, or any merger, consolidation or
business combination with, the Company (AN "ACQUISITION PROPOSAL"), or (ii)
participate in any discussions or negotiations regarding, or furnish any
non-public information to any person other than SSB and its representatives in
connection with, any Acquisition Proposal by any person other than SSB or its
Affiliates. The Company shall immediately cease and cause to be terminated any
existing discussions or negotiations with any parties conducted heretofore with
respect to the foregoing. The Company shall immediately notify SSB of any such
Acquisition Proposal or any inquiry or contact with respect thereto, including
the terms of such Acquisition Proposal.
6.3 ACCESS TO INFORMATION. (a) For a period of sixty (60) days after the
Closing Date, the Company shall, and the Stockholder shall cause the Company to,
give SSB and its officers, directors, financial advisors, counsel and other
agents access to all offices of the Company and to all of its books and records,
permit them to make such inspections as they may require and shall cause the
Company's officers, directors and employees to furnish SSB and its officers,
directors, financial advisors, counsel and other agents with such financial and
operating data and other information with respect to the business and properties
of the Company as SSB and its officers, directors, financial advisors, counsel
and other agents may from time to time reasonably request, and as may be
necessary to establish the performance by the Company of its covenants under
this Agreement and the accuracy of its representations and warranties herein,
and in connection with its preparation of any filing or submission to any
governmental entity or regulatory body.
(b) As per that certain Confidentiality and Non-Disclosure Agreement, SSB,
the Company and the Stockholder shall hold, and shall use their best efforts to
cause their respective officers, directors, partners, financial advisors,
counsel and other agents to hold, in strict confidence, unless compelled to
disclose by judicial or administrative process, or, in the opinion of their
counsel, by other requirements of law, all documents and information concerning
the Company and SSB, as the case may be, furnished to the other in connection
with the transactions contemplated by this Agreement.
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6.4 BEST EFFORTS. Subject to the terms and conditions herein provided, each
of the Company, the Stockholder and SSB agrees to use its best efforts to take,
or cause to be taken, all action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations, including
making all required submissions or filings with governmental entities and
regulatory bodies, to consummate and make effective the transactions
contemplated by this Agreement. If, at any time after the Closing Date, any
further action is necessary or desirable to carry out the purposes of this
Agreement, the parties hereto or their officers, directors or representatives
shall take all such necessary action. The Company, the Stockholder and SSB will
execute any additional instruments necessary to consummate the transactions
contemplated hereby.
6.5 CONSENTS. The Company shall obtain, and the Stockholder shall use their
best efforts to cause the Company to obtain, at its expense, all consents,
approvals and waivers of third parties or governmental entities or regulatory
bodies required to transfer the Assets to SSB.
6.6 PUBLIC ANNOUNCEMENTS. SSB, the Company and the Stockholder will consult
with each other before issuing any press release or otherwise making any public
statement with respect to the transactions contemplated hereby and shall not,
except as may be required by law or any listing agreements with any national
securities exchange, issue any such press release or make any such public
statement without the approval of SSB and the Company.
6.7 LITIGATION. From the date hereof through the Closing, the Company and
the Stockholder shall promptly notify SSB of any actions or proceedings of the
type referred to in Section 4.9 that from the date hereof are threatened or
commenced against the Company or the Assets, and of any requests for additional
information or documentary materials by any governmental entity or regulatory
body in connection with the transactions contemplated hereby.
6.8 CONTINUED EFFECTIVENESS OF REPRESENTATIONS AND WARRANTIES OF THE
COMPANY AND THE STOCKHOLDER. The representations and warranties contained in
Article IV shall continue to be true and correct on and as of the Closing Date
as if made on the Closing Date and the Company and the Stockholder shall
promptly notify SSB of any event, condition or circumstance occurring from the
date hereof through the Closing Date that would constitute a material violation
or breach by the Company or the Stockholder of any of such representations and
warranties.
6.10 EXPENSES. Except as otherwise provided herein, whether or not the
transactions contemplated hereby are consummated, all expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
the obligation of the party incurring such expenses.
6.11 DISCHARGE OF LIABILITIES. From and after the Closing Date, the Company
shall promptly and fully pay and discharge all Liabilities all as they become
due and payable with respect to the activities of the Company, except for the
Assumed Obligations. All Liabilities shall be promptly paid other than
Liabilities contested by the Company in good faith.
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6.12 BOOKS AND RECORDS. Until the later of (i) the expiration of four (4)
years from the Closing (and, if at the expiration thereof any judicial
proceeding is in progress, for such longer period as such judicial proceeding is
in progress) with respect to books and records of the Company relating to the
Assets, other than books and records of the Company relating to Asset-related
taxes, or (ii) the expiration of the applicable statutes of limitation,
including any extension or waiver thereof, with respect to books and records of
the Company relating to Asset-related taxes, SSB will retain, and, as the
Company may reasonably request, permit the Company at its expense during normal
business hours and upon reasonable prior written notice to inspect and copy, all
books and records of the Company that relate to the period prior to the Closing
Date. No access to books and records shall be required if SSB shall be
prejudiced thereby, including, without limitation, if such access would cause
the compromise of a claim or defense, breach of an agreement respecting
confidentiality or loss of a legal privilege. At any time after the fourth (4th)
anniversary of the Closing Date or, with respect to Asset-related tax matters,
the expiration of all applicable statutes of limitation, including any extension
or waiver thereof, SSB shall be permitted to destroy the books and records;
provided, however, that before destroying any of the books and records, SSB
shall give thirty (30) days notice thereof to the Company and give the Company
reasonable opportunity to copy such books and records to be destroyed.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE ACQUISITION
7.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective obligations of
each party to effect the transactions contemplated hereby are subject to the
satisfaction, at or prior to the Closing, of the following condition: No
statute, rule, regulation, executive order, decree, judgment or injunction shall
have been enacted, entered, promulgated or be in force by any court or
governmental authority which prohibits or restricts the consummation of the
transactions contemplated hereby; provided, however, that the parties hereto
shall use their best efforts to have any such order, decree or injunction
vacated.
7.2 ADDITIONAL CONDITIONS TO OBLIGATIONS OF THE COMPANY. The obligation of
the Company to effect the transactions contemplated hereby is also subject to
the fulfillment of the following conditions:
(a) The representations and warranties of SSB set forth in this Agreement
shall be true and correct in all material respects on the date hereof and shall
also be true and correct in all material respects on the Closing Date with the
same force and effect as if made on and as of the Closing Date, and SSB shall
have performed or complied in all material respects with all agreements,
conditions and covenants required by this Agreement to be performed or complied
with by them on or before the Closing Date.
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(b) There shall be no effective injunction, writ or preliminary restraining
order of any nature issued by a court or governmental agency of competent
jurisdiction directing that the transaction provided for herein not be
consummated as herein provided.
7.3 ADDITIONAL CONDITIONS TO OBLIGATIONS OF SSB. The obligations of SSB to
effect the transactions contemplated hereby are also subject to the following
conditions:
(A) The representations and warranties of the Company and the Stockholder
contained in this Agreement shall be true and correct in all material respects
on the date hereof and shall also be true and correct in all material respects
on and as at the Closing Date with the same force and effect as if made on and
as of the Closing Date, and the Company and the Stockholder shall have performed
or complied in all material respects with all agreements, conditions and
covenants required by this Agreement to be performed or complied with by them on
or before the Closing Date. SSB shall have received a certificate of the
President of the Company and the Stockholder in the form of Exhibit B to the
foregoing effect.
(B) The Company shall have delivered to SSB a certificate of the Secretary
of the Company, in the form of Exhibit C, certifying to the resolutions of the
Board of Directors and the Stockholder of the Company authorizing the
transactions contemplated hereby and certifying that such resolutions have not
been revoked, suspended or amended and remain in full force and effect.
(C) SSB shall have received, at SSB's expense, the following:
(I) An owner's extended coverage policy of title insurance on an ALTA
form designated by the Company with respect to the Property, in each case
issued on the date of Closing by Chicago Title Insurance Company or another
title insurance company acceptable to counsel for SSB (the "TITLE
COMPANY"), a copy of such policy is attached hereto as Exhibit D. Each such
title insurance policy shall be in an amount designated by the Company and
shall insure the Company's ownership of fee title to the Property without
any of the Schedule B standard pre-printed exceptions (other than taxes not
yet due and payable) and free and clear of Liens and other exceptions to or
exclusions from coverage other than Real Property Permitted Liens. Without
limiting the foregoing, no such title insurance policy shall create an
exception for or exclusion from the coverage of such policy or from the
liability of the Title Company on account of acts or omissions of the
insured or facts known to the insured (or to its current or former
directors, stockholders, partners, officers, agents or employees) where
such acts or omissions occurred, or where such knowledge was gained, prior
to the effective date of such title insurance policy. Each such title
insurance policy shall contain such endorsements, and shall otherwise be in
form and substance, satisfactory to SSB.
(II) A current survey of the Property, in each case prepared in
accordance with current "Minimum Standard Detail Requirements" for
ALTA/ASCM surveys and in accordance with the further provisions of this
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Section. Each such survey shall be certified to SSB and the Title Company
pursuant to a certification in form and substance satisfactory to SSB. Each
such survey shall otherwise be in form and substance satisfactory to SSB.
(III) FIRPTA Affidavit. An affidavit from the Stockholder, sworn to
under penalty of perjury, setting forth the name, address and Federal tax
identification number of the Stockholder and stating that each Stockholder
is not a "foreign person" within the meaning of Section 1445 of the Code.
(d) SSB shall have received from the Company the following:
(i) all right, title and interest in and to the Assets;
(ii) a ▇▇▇▇ of sale, in the form of Exhibit E; and
(iii) [INTENTIONALLY OMITTED];
(iv) such other deeds, bills of sale, endorsements, title documents,
assignments and other good and sufficient instruments of conveyance and
assignment, reasonably satisfactory in form and substance to SSB and its
counsel, as shall be necessary for SSB to consummate the transactions
contemplated hereby; and
(v) all documents they may reasonably request relating to the
existence of the Company and the authority of the Company and the
Stockholder to enter into this Agreement and to consummate the transactions
contemplated hereby.
(vi) All actions, proceedings, instruments and documents required to
carry out this Agreement and the transactions contemplated hereby, or
incidental hereto or thereto, and all other related legal matters shall
have been approved by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
(vii) All approvals, authorizations and consents required by the
Company to consummate the transactions contemplated hereby shall have been
obtained on terms and conditions reasonably satisfactory to SSB and shall
be in full force and effect, and SSB shall have been furnished with
appropriate evidence, reasonably satisfactory to it and its counsel of the
granting of such approvals, authorizations and consents.
ARTICLE VIII
NATURE AND SURVIVAL OF
REPRESENTATIONS AND WARRANTIES
All statements contained herein or in any certificate, schedule or other
document delivered pursuant hereto shall be deemed representations and
warranties by the person delivering the same. The representations and warranties
made in this Agreement shall survive for a period of eighteen (18) months from
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the date of the Lease Agreement; provided, however the representation set forth
in Section 4.6-The Assets shall survive for the applicable statute of
limitations for contracts.
ARTICLE IX
INDEMNIFICATION
(a) The Company and the Stockholder hereby jointly and severally agree to
indemnify and hold harmless SSB and its Affiliates from and against any
Liabilities, damages, losses, claims, Liens, costs or expenses (including
reasonable attorneys' fees) of any nature (ANY OR ALL OF THE FOREGOING ARE
HEREIN REFERRED TO AS "LOSS") insofar as a Loss (or actions in respect thereof),
whether existing or accruing prior or subsequent to the Closing Date, arises out
of or is based upon (i) any misrepresentation (or alleged misrepresentation) or
breach (or alleged breach) of any of the warranties, covenants or agreements
made by the Company and the Stockholder in this Agreement or in any certificate,
Schedule, document or Exhibit referenced hereby or attached hereto, (ii) the
Company's ownership, use or operation of the Assets or the conduct of its
business on or prior to the Closing Date, (iii) the Liabilities not expressly
assumed by SSB pursuant to this Agreement or (iv) any court or other
governmental order or decree that the transfer of the Assets shall be rescinded
as a result of, or pursuant to, the insolvency, bankruptcy, reorganization or
similar event with respect to the Company or the Stockholder arising out of or
relating to any action, suit to proceeding brought under the United States
Bankruptcy Code, or any tax statute or law or any other similar provisions of
Federal, State or Common law.
(b) SSB agrees to indemnify and hold harmless the Company and the
Stockholder from and against any Liabilities, damages, losses, claims, Liens,
costs or expenses (including reasonable attorneys' fees) of any nature (ANY OR
ALL OF THE FOREGOING ARE HEREIN REFERRED TO AS "LOSS") insofar as a Loss (or
actions in respect thereof), subsequent to the Closing Date, arises out of or is
based upon (i) any misrepresentation (or alleged misrepresentation) or breach
(or alleged breach) of any of the warranties, covenants or agreements made by
SSB in this Agreement or (ii) SSB's use or operation of the Assets or the
conduct of the business subsequent to the Closing Date.
(c) No claim for indemnification under this Article IX shall be valid
unless notice of the matter which may give rise to such claim is given in
writing by those seeking indemnification (THE "INDEMNITEES") to the persons
against whom indemnification may be sought (THE "INDEMNITORS") as soon as
reasonably practicable after such Indemnitees become aware of such claim,
provided that the failure to notify the Indemnitors shall not relieve them from
any Liability under this Article IX unless the Indemnitors shall be irrevocably
prejudiced thereby any shall in no event relieve the Indemnitors from any
Liability which they may have to the Indemnitees otherwise than under this
Article IX. Such notice shall, to the extent reasonably possible, state that the
Indemnitors are required to indemnify the Indemnitees for a Loss and shall
specify the amount of Loss and the relevant details thereof.
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(d) The Indemnitors shall have the right to settle and to defend, through
counsel satisfactory to the Indemnitees, at their expense, any action which may
be brought in connection with all indemnifiable matters subject to paragraph (a)
of this Article IX (A "THIRD PARTY ACTION"). In such event, the Indemnitees of
the Loss in question and any successors thereto shall permit the Indemnitors
access to their books and records and otherwise cooperate with the Indemnitors
in connection with such action, provided that the Indemnitees shall have the
right fully to participate in such defense at their own expense. The defense by
the Indemnitors of any such action shall not be deemed a waiver by the
Indemnitors of their right to assert a dispute with respect to the
responsibility of the Indemnitors with respect to the Loss in question. The
Indemnitors shall have the right to settle or compromise any claim against the
Indemnitees without the consent of the Indemnitees provided that the terms
thereof provide for the unconditional release of the Indemnitees and require the
payment of monetary damages only. No Indemnitee shall pay or voluntarily permit
the determination of any Liability which is subject to any such action while the
Indemnitors are negotiating the settlement thereof or contesting the matter,
except with the prior written consent of the Indemnitors, which consent shall
not be unreasonably withheld or delayed. If the Indemnitors shall fail to take
reasonably timely action to defend any such action, the Indemnitees involved
shall have the right to assume the defense thereof with counsel of their
choosing, at the Indemnitors' expense, and defend, settle or otherwise dispose
of such action. With respect to any such action which the Indemnitors shall fail
to promptly defend, the Indemnitors shall not thereafter question the Liability
of the Indemnitors hereunder to the Indemnitees for any Loss (including
reasonable counsel fees and other reasonable expenses of defense).
ARTICLE X
TERMINATION; AMENDMENT; WAIVER
10.1 TERMINATION. This Agreement and the transactions contemplated hereby
may be terminated at any time prior to the Closing:
(a) by mutual written agreement of the Company and SSB;
(b) by the Company or SSB upon the expiration of the Option Period, or if
the Closing shall not have occurred on or before the Closing Date, so long as
the party terminating this Agreement pursuant to this Section 10.1 has not made
any material misrepresentation, materially breached a covenant, agreement or
warranty contained herein or failed to satisfy a closing condition;
(c) by SSB or the Company, if (i) the transactions contemplated hereby
shall violate any non-appealable final order, decree or judgment of any court or
governmental entity or regulatory body having competent jurisdiction or (ii)
there shall be a statute, rule or regulation which makes the transactions
contemplated hereby illegal or otherwise prohibited; or
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(d) by the Company or the Stockholder, on the one hand, and SSB, on the
other hand, in the event the other makes a material misrepresentation, breaches
a covenant, agreement or warranty set forth in this Agreement or fails to
satisfy a closing condition, but such non-misrepresenting or non-breaching
party's election to terminate shall not limit, waive or prejudice such party's
remedies at law or in equity.
In the event this Agreement is terminated as provided in Section 10.1(a),
(b) or (c), this Agreement shall become void and of no further force and effect
and no party hereto shall have any further liability to any other party hereto,
except that Sections 6.6 and 6.10 shall survive and continue in full force and
effect notwithstanding termination.
10.2 AMENDMENT. This Agreement may be amended by action taken by the
Company, the Stockholder and SSB at any time before or after adoption of this
Agreement by the stockholders of the Company. This Agreement may not be amended
except by an instrument in writing signed by or on behalf of the Company, the
Stockholder and SSB.
10.3 EXTENSION; WAIVER. At any time prior to the Closing Date, the Company,
the Stockholder or SSB may (i) extend the time for the performance of any of the
obligations or other acts of the other; (ii) waive any inaccuracies in the
representations and warranties contained herein or in any document, certificate
or writing delivered pursuant hereto or thereto; and (iii) waive compliance with
any of the agreements or conditions contained herein. Any agreement on the part
of any party to any such extension or waiver shall be valid only if set forth in
an instrument in writing signed by or on behalf of such party.
ARTICLE XI
MISCELLANEOUS
11.1 ENTIRE AGREEMENT; ASSIGNMENT. This Agreement, together with all
Schedules and Exhibits, constitutes the entire agreement among the parties with
respect to the subject matter hereof and supersedes all other prior agreements
and understandings, both written and oral, among the parties or between any of
them with respect to the subject matter hereof. All references to Sections,
Exhibits and Schedules shall be deemed references to such parts of this
Agreement unless the text requires otherwise. This Agreement shall not be
assigned by operation of law or otherwise, provided that SSB may assign its
rights and obligations to any wholly-owned, direct or indirect, subsidiary of
SSB, but no such assignment shall relieve the assigning party of its obligations
hereunder if such assignee does not perform such obligations.
11.2 VALIDITY; SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect unless such enforceability causes this Agreement to fail in its essential
purpose.
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11.3 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made as of
the date delivered or mailed if delivered in person, by telecopy, email, or by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties as follows:
if to SSB:
▇▇▇▇▇'▇ Pride, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
email: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Fax: ▇▇▇- ▇▇▇-▇▇▇▇
email: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
if to the Company:
Clear Lake Specialty Products, Inc.
with a copy to:
Covahey, Boozer, Devan & Dore P.A.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
EP III ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇, Esq.
Fax: ▇▇▇-▇▇▇-▇▇▇▇
email: ▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
or to such other address as the person to whom notices is given may have
previously furnished to the others in writing in the manner set forth above.
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11.4 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
11.5 DESCRIPTIVE HEADINGS; TABLE OF CONTENTS. The descriptive headings
herein are inserted for convenience of reference only and are not intended to be
part of or to affect the meaning or interpretation of this Agreement. The Table
of Contents preceding this Agreement is not a part hereof.
11.6 PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto, its successors and assigns.
11.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, including by facsimile or PDF signature, each of which shall be
deemed to be an original, but all of which shall constitute one and the same
agreement.
11.8 SPECIFIC PERFORMANCE. Irreparable damage would occur if any of the
provisions of this Agreement were not performed in accordance with the terms
hereof, and the parties shall be entitled to specific performance of the terms
hereof, in addition to any other remedy at law or equity.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, or
individually, as the case may be, all as of the day and year first above
written.
THE SOUTH STREET BAKERY, INC.
By: /s/ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President
CLEAR LAKE SPECIALTY PRODUCTS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
▇▇▇▇▇ PROPERTIES, LLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Partner
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List of Exhibits
Exhibit A Lease Agreement
Exhibit B Certificate of President of the Company
Exhibit C Certificate of Secretary of the Company Board Resolutions
Exhibit D Title Insurance Policy
Exhibit E ▇▇▇▇ of Sale
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EXHIBIT A-LEASE AGREEMENT
See attached copy of Lease Agreement
-28-
EXHIBIT B-CERTIFICATE OF PRESIDENT OF THE COMPANY
PRESIDENT'S CERTIFICATE
OF
CLEAR LAKE SPECIALTY PRODUCTS, INC.
dated as of
August __, 2012
This certificate is delivered pursuant to Section 7.3(a) of that certain
Option Agreement (the "Option Agreement"), dated August _, 2011, by and among
THE SOUTH STREET BAKERY, INC, CLEAR LAKE SPECIALTY PRODUCTS, INC. (the
"Company") and ▇▇▇▇▇ PROPERTIES, LLC. (the "Stockholder").
I, ▇▇▇▇▇ ▇▇▇▇▇, solely in my capacity as President of the Company, and not
individually, do hereby certify on behalf of the Company and the Stockholder
that:
1. The representations and warranties of the Company and the Stockholder
contained in the Option Agreement are true and correct in all material
respects as of the date hereof, and the Company and the Stockholder
have performed or complied in all material respects with all
agreements, conditions and covenants required by the Option Agreement
to be performed or complied by them as of the date hereof.
IN WITNESS WHEREOF, the undersigned has executed this President's
Certificate on the date hereof.
/s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇▇▇▇▇
President
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EXHIBIT C - CERTIFICATE OF SECRETARY OF THE COMPANY BOARD RESOLUTIONS
SECRETARY'S CERTIFICATE
OF
CLEAR LAKE SPECIALTY PRODUCTS, INC.
dated as of
August __, 2012
This certificate is delivered pursuant to Section 7.3(b) of that certain
Option Agreement (the "Option Agreement"), dated August _, 2011, by and among
THE SOUTH STREET BAKERY, INC, CLEAR LAKE SPECIALTY PRODUCTS, INC. (the
"Company") and ▇▇▇▇▇ PROPERTIES, LLC. (the "Stockholder").
I, ▇▇▇▇▇▇ ▇▇▇▇▇, solely in my capacity as Secretary of the Company, and not
individually, do hereby certify on behalf of the Company and the Stockholder
that:
1. Attached hereto as Exhibit A is a true and correct copy of the
resolutions of the Board of Directors and the Stockholder of the
Company authorizing the transactions contemplated by the Option
Agreement and such resolutions have not in any way been rescinded or
modified and have been in full force and effect since their adoption
to and including the date hereof and are now in full force and effect,
and such resolutions are the only corporate proceedings of the Company
to date now in force relating to or affecting the matters referred to
herein.
IN WITNESS WHEREOF, the undersigned has executed this Secretary's
Certificate on the date hereof.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Secretary
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EXHIBIT D - TITLE INSURANCE POLICY
See attached copy of Title Insurance Policy
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EXHIBIT E- ▇▇▇▇ OF SALE
This ▇▇▇▇ OF SALE, dated August __, 2012, is executed and delivered by
CLEAR LAKE SPECIALTY PRODUCTS, INC., an Iowa corporation (THE "COMPANY"), and
▇▇▇▇▇ PROPERTIES, LLC, an Iowa limited liability company, (THE "STOCKHOLDER") in
favor of THE SOUTH STREET BAKERY, INC, a Delaware corporation ("SSB")
W I T N E S S E T H
WHEREAS, the Company, the Stockholder and SSB have entered into that
certain Option Purchase Agreement, dated August __, 2011 (the "OPTION
AGREEMENT"), pursuant to which the Company and the Stockholder are obligated to
sell, convey, transfer, assign and deliver to SSB the Assets and Property each
defined therein; and
WHEREAS, capitalized terms not defined herein shall have the meanings
ascribed to them in the Option Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and pursuant to the Option
Agreement, the parties hereto hereby agree as follows:
1. The Company and the Stockholder have received a payment of
$____________.
2. The Company and the Stockholder hereby sell, convey, transfer, assign
and deliver to SSB, free and clear of all Liens and liabilities other
than Real Property Permitted Liens all of the Company's right, title
and interest in and to the Assets and Property.
3. The Company and the Stockholder hereby constitute and appoint SSB and
its successors and assigns as the attorney in fact of the Company and
Stockholder, with full power of substitution to institute and
prosecute, in the name of the Company and the Stockholder, but on
behalf of and for the benefit of SSB, all proceedings which SSB may
deem desirable to collect, assert or enforce any claim, right or title
of any kind in or to the Assets and Property and to defend and
compromise any and all actions, suits or proceedings in connection
with the Assets and Property. The Company and the Stockholder agree
that the foregoing powers are coupled with an interest and are and
shall be irrevocable by the Company and Stockholder in any manner or
for any reason (including dissolution of the Company or the
Stockholder).
4. The Company and the Stockholder shall execute and deliver to SSB such
other instruments of sale, transfer, conveyance, assignment and
confirmation, provide such materials and information and take such
other actions as SSB may reasonably deem necessary or desirable in
order to more effectively transfer, convey and assign to SSB and to
confirm SSB's title to the Assets and the Property, and , to the full
extent permitted by law, to put SSB in actual possession and control
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of the Assets and Property and to assist SSB in exercising all rights
with respect thereto, and otherwise to cause the Company and the
Stockholder to fulfill their obligations under this ▇▇▇▇ of Sale and
the Option Agreement.
5. This ▇▇▇▇ of Sale is the ▇▇▇▇ of Sale referred to in the Option
Agreement and is subject to the terms and conditions thereof, all of
which are incorporated herein by reference.
6. This ▇▇▇▇ of Sale shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. This
▇▇▇▇ of Sale shall be governed by and construed in accordance with the
laws of the State of Delaware, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws
thereof.
7. This ▇▇▇▇ of Sale may be executed in two or more counterparts,
including by facsimile or PDF signature, each of which shall be deemed
to be an original, but all of which shall constitute one and the same
instrument.
IN WITNESS WHEREOF, each of the parties has caused this ▇▇▇▇ of Sale to be
executed on its behalf by its officers thereunto duly authorized, or
individually, as the case may be, all as of the day and year first above
written.
THE SOUTH STREET BAKERY, INC.
By:
-----------------------------------
Name:
Title:
CLEAR LAKE SPECIALTY PRODUCTS, INC.
By:
-----------------------------------
Name:
Title:
▇▇▇▇▇ PROPERTIES, LLC
By:
-----------------------------------
Name:
Title:
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