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EXHIBIT 10.52
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PURCHASE AGREEMENT
BETWEEN
GROUP 1 AUTOMOTIVE, INC.,
AND
THE STOCKHOLDER OF
▇▇▇ ▇▇▇▇▇▇ NISSAN, INC.
DATED AS OF
DECEMBER 30, 1997
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Rules of Construction . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
THE ACQUISITION
2.1 The Acquisition . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Closing Date . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER
3.1 Organization . . . . . . . . . . . . . . . . . . . . . . . . 2
3.2 Qualification . . . . . . . . . . . . . . . . . . . . . . . 2
3.3 Absence of Conflicts . . . . . . . . . . . . . . . . . . . . 2
3.4 Equity Investments . . . . . . . . . . . . . . . . . . . . . 3
3.5 Capitalization . . . . . . . . . . . . . . . . . . . . . . . 3
3.6 Financial Statements . . . . . . . . . . . . . . . . . . . . 3
3.7 Undisclosed Liabilities . . . . . . . . . . . . . . . . . . 3
3.8 Certain Agreements . . . . . . . . . . . . . . . . . . . . . 4
3.9 Contracts and Commitments . . . . . . . . . . . . . . . . . 4
3.10 Absence of Changes . . . . . . . . . . . . . . . . . . . . . 4
3.11 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . 4
3.12 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.13 Compliance with Law . . . . . . . . . . . . . . . . . . . . 5
3.14 Permits . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.15 Employee Benefit Plans and Policies . . . . . . . . . . . . 6
3.16 Properties . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.17 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.18 Affiliate Interests . . . . . . . . . . . . . . . . . . . . 7
3.19 Environmental Matters . . . . . . . . . . . . . . . . . . . 8
3.20 Intellectual Property . . . . . . . . . . . . . . . . . . . 10
3.21 Bank Accounts . . . . . . . . . . . . . . . . . . . . . . . 10
3.22 Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.23 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . 11
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ARTICLE IV
ADDITIONAL REPRESENTATIONS AND
WARRANTIES OF THE STOCKHOLDER
4.1 Capital Stock. . . . . . . . . . . . . . . . . . . . . . . . 11
4.2 Authorization of Agreement . . . . . . . . . . . . . . . . . 11
4.3 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.4 Absence of Conflicts . . . . . . . . . . . . . . . . . . . . 12
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF GROUP 1
5.1 Corporate Organization . . . . . . . . . . . . . . . . . . . 12
5.2 Authorization . . . . . . . . . . . . . . . . . . . . . . . 12
5.3 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.4 Absence of Conflicts . . . . . . . . . . . . . . . . . . . . 12
ARTICLE VI
COVENANTS OF THE STOCKHOLDER
6.1 Acquisition Proposals . . . . . . . . . . . . . . . . . . . 13
6.2 Access . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.3 Conduct of Business by the Company Pending the Acquisition . 13
6.4 Notification of Certain Matters . . . . . . . . . . . . . . 15
6.5 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.6 Removal of Related Party Guarantees . . . . . . . . . . . . 15
6.7 Termination of Related Party Agreements . . . . . . . . . . 15
6.8 Related Party Agreements . . . . . . . . . . . . . . . . . . 15
ARTICLE VII
COVENANTS OF GROUP 1
7.1 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE VIII
CONDITIONS
8.1 Conditions Precedent to Obligation of Each Party to Effect the
Acquisition . . . . . . . . . . . . . . . . . . . . . . . . 16
8.2 Additional Conditions Precedent to Obligations of Group 1 . 16
8.3 Additional Conditions Precedent to Obligations of the
Stockholder . . . . . . . . . . . . . . . . . . . . . . . . 17
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ARTICLE IX
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
9.1 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE X
MISCELLANEOUS
10.1 Schedules to this Agreement. . . . . . . . . . . . . . . . . 17
10.2 Termination . . . . . . . . . . . . . . . . . . . . . . . . 17
10.3 Effect of Termination . . . . . . . . . . . . . . . . . . . 18
10.4 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 18
10.5 Waiver and Amendment . . . . . . . . . . . . . . . . . . . . 18
10.6 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . 19
10.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 19
10.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . 20
10.9 Severability . . . . . . . . . . . . . . . . . . . . . . . . 20
10.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 20
10.11 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 20
10.12 Third Party Beneficiaries . . . . . . . . . . . . . . . . . 20
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GROUP 1 AUTOMOTIVE, INC.
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement"), dated as of the 30th
day of December, 1997, is between Group 1 Automotive, Inc., a Delaware
corporation ("Group 1") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇, the sole stockholder
("Stockholder") of ▇▇▇ ▇▇▇▇▇▇ Nissan, Inc., an Oklahoma corporation (the
"Company").
RECITALS:
WHEREAS, the Stockholder is the holder of all of the issued and
outstanding capital stock of the Company;
WHEREAS, Group 1 proposes to acquire all of the capital stock of the
Company from the Stockholder (the "Acquisition") on the terms and conditions
set forth herein; and
WHEREAS, the parties hereto wish to set forth the representations,
warranties, agreements and conditions under which Group 1 shall purchase, and
the Stockholder shall sell, all of the capital stock of the Company.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
representations, warranties and covenants herein contained, the parties hereto
hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. Certain capitalized and other terms used in this
Agreement are defined in Annex A hereto and are used herein with the meanings
ascribed to them therein.
1.2 Rules of Construction. Unless the context otherwise requires,
as used in this Agreement, (a) a term has the meaning ascribed to it; (b) an
accounting term not otherwise defined has the meaning ascribed to it in
accordance with GAAP; (c) "or" is not exclusive; (d) "including" means
"including, without limitation;" (e) words in the singular include the plural;
(f) words in the plural include the singular; (g) words applicable to one
gender shall be construed to apply to each gender; (h) the terms "hereof,"
"herein," "hereby," "hereto" and derivative or similar words refer to this
entire Agreement; (i) the terms "Article" or "Section" shall refer to the
specified Article or Section of this Agreement; and (j) section and paragraph
headings in this Agreement are for convenience only and shall not affect the
construction of this Agreement.
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ARTICLE II
THE ACQUISITION
2.1 The Acquisition. At the Closing, the Stockholder shall sell
to Group 1 and Group 1 shall purchase from the Stockholder 1,000 shares of
Common Stock of the Company for a purchase price of $1,250,000 in cash payable
in immediately available funds.
2.2 Closing Date. The Closing of the Acquisition as contemplated
by this Agreement shall take place at the offices of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.,
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, as soon as practicable after the
satisfaction or waiver of the conditions set forth in Article VIII or at such
other time and place and on such other date as Group 1 and the Stockholder
shall agree; provided, that the conditions set forth in Article VIII shall have
been satisfied or waived at or prior to such time. The date on which the
Closing occurs is herein referred to as the "Closing Date," and shall be
effective as of the first day of the month in which the Closing Date occurs.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE STOCKHOLDER
The Stockholder hereby represent and warrant to Group 1 as follows:
3.1 Organization. The Compay is a corporation duly organized,
validly existing and in good standing under the laws of the state of Oklahoma
with all requisite corporate power and authority to own or lease its properties
and conduct its business as now owned, leased or conducted. True and complete
copies of the articles of incorporation and bylaws of the Company are included
in Schedule 3.1. The minute books of the Company previously made available to
Group 1 are complete and accurately reflect all action taken prior to the date
of this Agreement by its board of directors and stockholders in their
capacities as such.
3.2 Qualification. The Company is duly qualified to do business
as a foreign entity and is in good standing in each jurisdiction in which the
nature of the business as now conducted or the character of the property owned
or leased by it makes such qualification necessary. Schedule 3.2 sets forth a
list of the jurisdictions in which each of the Company is qualified to do
business, if any.
3.3 Absence of Conflicts. Except to the extent set forth in the
Schedule 3.3, neither the execution and delivery by the Stockholder of this
Agreement or any instrument, document or agreement required hereby to be
executed and delivered by them at, or prior to, the Closing, nor the
performance by the Stockholder of their obligations under this Agreement or any
such instrument, document or agreement will (assuming receipt of all consents,
approvals, authorizations, permits, certificates and orders disclosed as
requisite in Schedule 4.3) (a) violate or breach the terms of or cause a
default under (i) any applicable Order or any applicable rule or regulation of
any Court or Governmental Authority with respect to the Company, (ii) any
applicable permits received from any Governmental Authority with respect to the
Company, (iii) the certificate of incorporation or bylaws of the Company or
(iv) any contract or agreement to which the Company is a party or by which it,
or any of its properties, is bound, or (b) result in the creation or imposition
of any Lien on any of the
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properties or assets of the Company, or (c) result in the cancellation,
forfeiture, revocation, suspension or adverse modification of any existing
consent, approval, authorization, license, permit, certificate or order of any
Court or Governmental Authority with respect to the Company, or (d) with the
passage of time or the giving of notice or the taking of any action of any
third party have any of the effects set forth in clause (a), (b) or (c) of this
Section.
3.4 Equity Investments. The Company owns no equity securities,
interests or other investments in any Person.
3.5 Capitalization. The authorized capital stock of the
Company consists of 50,000 shares of Common Stock, $1.00 par value per share,
of which 1,000 shares are issued and outstanding. Each outstanding share of
the Common Stock of the Company has been duly authorized, is validly issued,
fully paid and nonassessable and was not issued in violation of any preemptive
rights of any stockholder. Except for 1,000 shares of Common Stock owned by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇, there are no shares of capital stock of, or other equity
interests in, the Company authorized, issued or outstanding. There is not
outstanding any other security, including without limitation any option,
warrant or right, entitling the holder thereof to purchase or otherwise acquire
any Common Stock or other equity interest of the Company. There are no
contracts, agreements, commitments or arrangements obligating the Company (i)
to issue, sell, pledge, dispose of or encumber any Common Stock, or any
options, warrants or rights of any kind to acquire, or any securities that are
convertible into or exercisable or exchangeable for, any Common Stock of, or
any other class of securities of the Company or (ii) to redeem, purchase or
acquire or offer to acquire any Common Stock of, or any outstanding option,
warrant or right to acquire, or any securities that are convertible into or
exercisable or exchangeable for, any Common Stock of, or any other class of
securities of the Company.
3.6 Financial Statements. Included in Schedule 3.6 are true and
complete copies of the financial statements of the Company consisting of (i) an
unaudited balance sheet of the Company as of November30, 1997 (the "Interim
Balance Sheet") and the related unaudited statement of income for the four
month period (from August 1997, the month of incorporation of the Company) then
ended (the "Company Financial Statements"). The Company Financial Statements
present fairly the financial position of the Company and the results of its
operations and changes in financial position as of the dates and for the
periods indicated therein in conformity with GAAP. The Company Financial
Statements do not omit to state any liabilities, absolute or contingent,
required to be stated therein in accordance with GAAP. All accounts receivable
of the Company reflected in the Company Financial Statements and as incurred
since November 30, 1997 represent sales made in the ordinary course of
business, are collectible (net of any reserves for doubtful accounts shown in
the Company Financial Statements) in the ordinary course of business and,
except as set forth in Schedule 3.6, are not in dispute or subject to
counterclaim, set-off or renegotiation. Schedule 3.6 contains an aged schedule
of accounts receivable included in the Interim Balance Sheet.
3.7 Undisclosed Liabilities. Except as and to the extent of the
amounts specifically reflected or accrued for in the Interim Balance Sheet or
as set forth in Schedule 3.7, the Company does not have any liabilities or
obligations of any nature whether absolute, accrued, contingent or otherwise,
and whether due or to become due. The reserves reflected in the Interim
Balance Sheet are adequate, appropriate and reasonable in accordance with GAAP.
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3.8 Certain Agreements. Except as set forth in Schedule 3.8,
neither the Company nor any of its officers or directors, is a party to, or
bound by, any contract, agreement or organizational document which purports to
restrict, by virtue of a non-competition, territorial exclusivity or other
provision covering such subject matter purportedly enforceable by a third party
against the Company, or any of its officers or directors, the scope of the
business or operations of the Company, or any of its officers or directors,
geographically or otherwise.
3.9 Contracts and Commitments. Schedule 3.9 includes (i) a list
of all contracts to which the Company is a party or by which its property is
bound that involve consideration or other expenditure in excess of $50,000 or
performance over a period of more than six months or that is otherwise material
to the business or operations of the Company ("Material Contracts"); (ii) a
list of all real or personal property leases to which the Company is a party
involving consideration or other expenditure in excess of $50,000 over the term
of the lease ("Material Leases"); (iii) a list of all guarantees of, or
agreements to indemnify or be contingently liable for, the payment or
performance by any Person to which the Company is a party ("Guarantees") and
(iv) a list of all contracts or other formal or informal understandings between
the Company and any of their officers, directors, employees, agents or
stockholders or their affiliates ("Related Party Agreements"). True and
complete copies of each Material Contract, Material Lease, Guarantee and
Related Party Agreement have been furnished to Group 1.
3.10 Absence of Changes. Except as set forth in Schedule 3.10,
there has not been, since November 30, 1997, any adverse change with respect to
the business, assets, results of operations, prospects or condition (financial
or otherwise) of the Company. Except as set forth in Schedule 3.10, since
November 30, 1997, the Company has not engaged in any transaction or conduct of
any kind which would be proscribed by Section 6.3 herein after execution and
delivery of this Agreement. Notwithstanding the preceding sentence, the
Company makes no representation regarding, and need not disclose, increases in
compensation (of the type contemplated in Section 6.3(f)) since November 30,
1997, for any employee who after such increase would receive annual
compensation of less than $50,000.
3.11 Tax Matters.
(a) Except as set forth in Schedule 3.11, (i) all Tax
Returns which are required to be filed on or before the Closing Date
by or with respect to the Company have been or will be duly and timely
filed, (ii) all items of income, gain, loss, deduction and credit or
other items required to be included in each such Tax Return have been
or will be so included and all information provided in each such Tax
Return is true, correct and complete, (iii) all Taxes which have
become or will become due with respect to the period covered by each
such Tax Return have been or will be timely paid in full, (iv) all
withholding Tax requirements imposed on or with respect to the Company
have been or will be satisfied in full, and (v) no penalty, interest
or other charge is or will become due with respect to the late filing
of any such Tax Return or late payment of any such Tax.
(b) There is no claim against the Company for any Taxes,
and no assessment, deficiency or adjustment has been asserted or
proposed with respect to any Tax Return of or
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with respect to the Company, other than those disclosed (and to which
are attached true and complete copies of all audit or similar reports)
in Schedule 3.11(b).
(c) There is not in force any extension of time with
respect to the due date for the filing of any Tax Return of or with
respect to the Company, or any waiver or agreement for any extension
of time for the assessment or payment of any Tax of or with respect to
the Company.
(d) The total amounts set up as liabilities for current
and deferred Taxes in the Interim Balance Sheet are sufficient to
cover the payment of all Taxes, whether or not assessed or disputed,
which are, or are hereafter found to be, or to have been, due by or
with respect to the Company up to and through the periods covered
thereby.
(e) The Company will not be required to include any
amount in income for any taxable period as a result of a change in
accounting method for any taxable period pursuant to any agreement
with any Tax authority with respect to any such taxable period.
(f) The Company has not consented to have the provisions
of section 341(f)(2) of the Code apply with respect to a sale of its
stock.
(g) From the end of its most recent tax year through the
Closing Date, (a) the Company continuously has been and will be an S
Corporation within the meaning of section 1361 of the Code, and (b)
each holder of the stock of the Company has been an individual
resident of the United States.
3.12 Litigation.
(a) Except as set forth in Schedule 3.12(a), there are no
actions at law, suits in equity, investigations, proceedings or claims
pending or, to the knowledge of the Stockholder, threatened against or
specifically affecting the Company before or by any Court or
Governmental Authority.
(b) Except as contemplated by this Agreement and except
to the extent set forth in Schedule 3.12(b), the Company has
performed all obligations required to be performed by it to date and
is not in default under, and, to the knowledge of the Stockholder, no
event has occurred which, with the lapse of time or action by a third
party could result in a default under any contract or other agreement
to which the Company is a party or by which it or any of its
properties is bound or under any applicable Order of any Court or
Governmental Authority.
3.13 Compliance with Law. Except as set forth in Schedule 3.13,
the Company is in compliance with all applicable statutes and other applicable
laws and all applicable rules and regulations of all federal, state, foreign
and local governmental agencies and authorities.
3.14 Permits. Except as set forth in Schedule 3.14, the Company
owns or holds all franchises, licenses, permits, consents, approvals and
authorizations of all Governmental Authorities
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necessary for the conduct of its business. Each franchise, license, permit,
consent, approval and authorization so owned or held is in full force and
effect, and the Company is in compliance with all of its obligations with
respect thereto, and no event has occurred which allows, or upon the giving of
notice or the lapse of time or otherwise would allow, revocation or termination
of any franchise, license, permit, consent, approval or authorization so owned
or held.
3.15 Employee Benefit Plans and Policies. Except as set forth in
Schedule 3.15, the Company has no benefit plans of any kind.
3.16 Properties.
(a) The Company does not own any real property or any
interest therein. Schedule 3.16(a) (the "Leased Properties") sets
forth the location and size of, principal improvements and buildings
on, and Liens on all parcels of real estate leased by the Company
(individually, a "Leased Property" and collectively, the "Leased
Properties"). True and correct copies of all such Liens are attached
to Schedule 3.16(a). Except as set forth in Schedule 3.16(a), with
respect to each Leased Property:
(i) the Company has good and valid leasehold
interests in each parcel of its Leased Property, free and
clear of any Lien other than Permitted Encumbrances;
(ii) there are no pending or, to the knowledge of
the Company or the Stockholder, threatened condemnation
proceedings, suits or administrative actions relating to the
Leased Properties or other matters affecting adversely the
current use, occupancy or value thereof;
(iii) except as set forth in Schedule 3.16(a), the
legal descriptions for the parcels of Leased Property
contained in the deeds thereof describe such parcels fully and
adequately; the buildings and improvements are located within
the boundary lines of the described parcels of land, are not
in violation of applicable setback requirements, local
comprehensive plan provisions, zoning laws and ordinances (and
none of the properties or buildings or improvements thereon
are subject to "permitted non-conforming use" or "permitted
non-conforming structure" classifications), building code
requirements, permits, licenses or other forms of approval by
any Governmental Authority, and do not encroach on any
easement which may burden the land;
(iv) all facilities have received all approvals of
Governmental Authorities (including licenses and permits)
required in connection with the leasing or operation thereof
and have been operated and maintained in compliance with
applicable laws, ordinances, rules and regulations;
(v) there are no contracts granting to any party
or parties the right of use or occupancy of any portion of the
parcels of Leased Property, except as set forth in Schedule
3.16(a);
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(vi) there are no outstanding options or rights of
first refusal to purchase the parcels of Leased Property, or
any portion thereof or interest therein;
(vii) there are no parties (other than the Company)
in possession of the parcels of Leased Property, other than
tenants under any leases disclosed in Schedule 3.16(a) who are
in possession of space to which they are entitled;
(viii) all facilities located on the parcels of
Leased Property are supplied with utilities and other services
necessary for the operation of such facilities;
(ix) each parcel of Leased Property abuts on and
has direct vehicular access to a public road, or has access to
a public road;
(x) all improvements and buildings on the Leased
Property are in good repair and adequate for the use of such
Leased Property in the manner in which presently used; and
(xi) there are no material service contracts,
management agreements or similar agreements which affect the
parcels of Leased Property, except as set forth in Schedule
3.16(a).
(b) Except as set forth in Schedule 3.16(b), each of the Company
has good and marketable title to all of its Assets, free and clear of any Liens
or restrictions on use. The Fixed Assets currently in use for the business and
operations of the Company are in good operating condition, normal wear and tear
excepted and have been maintained in accordance with sound industry practices.
3.17 Insurance. Schedule 3.17 sets forth a list of all policies of
insurance currently in effect relating to the business or operations of the
Company (true and complete copies of which have been furnished to Group 1).
Such insurance policies are in full force and effect. The Company is presently
insured, and since the inception of operations by the Company has been insured,
against such risks as companies engaged in the same or substantially similar
business would, in accordance with good business practice, customarily be
insured. The Company has given in a timely manner to its insurers all notices
required to be given under such insurance policies with respect to all claims
and actions covered by insurance, and, except as set forth in Schedule 3.17, no
insurer has denied coverage of any such claims or actions or reserved its
rights in respect of or rejected any of such claims. The Company has not
received any notice or other communication from any such insurer canceling or
materially amending any of such insurance policies, and no such cancellation is
pending or threatened. The execution of this Agreement and the consummation of
the transactions contemplated hereby will not cause such insurance policies to
lapse, terminate or be canceled and will not result in any party thereto having
the right to terminate or cancel such insurance policies.
3.18 Affiliate Interests. Except as set forth in Schedule 3.18, no
employee, officer or director, or former employee, officer or director, of the
Company has any interest in any property, tangible or intangible, including
without limitation, patents, trade secrets, other confidential business
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information, trademarks, service marks or trade names, used in or pertaining to
the business of the Company, except for the normal rights of employees,
partners, and stockholders.
3.19 Environmental Matters. Except as set forth in Schedule 3.19:
(a) The Company is in compliance with all Environmental
Laws, including, without limitation, Environmental Laws with respect
to discharges into the ground water, surface water and soil, emissions
into the ambient air, and generation, accumulation, storage,
treatment, transportation, transfer, labeling, handling,
manufacturing, use, spilling, leaking, dumping, discharging, release
or disposal of Hazardous Substances, or other Waste. The Company is
currently not liable for any penalties, fines or forfeitures for
failure to comply with any Environmental Laws. The Company is in
compliance with all required notice, record keeping and reporting
requirements of all Environmental Laws, and has complied with all
informational requests or demands arising under the Environmental
Laws.
(b) The Company has obtained, or caused to be obtained,
and is in compliance with, all Licenses required by the Environmental
Laws for the ownership of its properties and assets and the operation
of its business as presently conducted, including, without limitation,
all air emission, water discharge, water use and solid waste,
hazardous waste and other Waste generation, transportation, transfer,
storage, treatment or disposal Licenses (a listing of such items being
included in Schedule 3.19(b), and the Company is in compliance with
all the terms, conditions and requirements of such Licenses, and
copies of such Licenses have been made available to Group 1. There
are no administrative or judicial investigations, notices, claims or
other proceedings pending or threatened by any Governmental Authority
or third parties against the Company or its business, operations,
properties, or assets, which question the validity or entitlement of
the Company to any License required by the Environmental Laws for the
ownership of each of the respective properties and assets of the
Company and the operation of its business.
(c) The Company has not received or is aware of any
non-compliance order, warning letter, investigation, notice of
violation, claim, suit, action, judgment, or administrative or
judicial proceeding pending or threatened against or involving the
Company or its business, operations, properties, or assets, issued by
any Governmental Authority or third party with respect to any
Environmental Laws in connection with the ownership of its properties
or assets or the operation of its business, which has not been
resolved to the satisfaction of the issuing Governmental Authority or
third party.
(d) The Company is in compliance with, and is not in
breach of or default under any applicable writ, order, judgment,
injunction, governmental communication or decree issued pursuant to
the Environmental Laws and no event has occurred or is continuing
which, with the passage of time or the giving of notice or both, would
constitute such non-compliance, breach or default thereunder, or
affect the Leased Properties.
(e) The Company has not generated, manufactured, used,
transported, transferred, stored, handled, treated, spilled, leaked,
dumped, discharged, released or disposed, nor has it arranged for any
third parties to generate, manufacture, use, transport, transfer,
store,
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13
handle, treat, spill, leak, dump, discharge, release or dispose of,
Hazardous Substances or other waste in an amount so as to require
remedial efforts to or at any location other than a site permitted to
receive such Hazardous Substances or other waste, nor has it
performed, arranged for or allowed by any method or procedure such
generation, manufacture, use, transportation, transfer, storage,
treatment, spillage, leakage, dumping, discharge, release or disposal
in contravention of any Environmental Laws. The Company has not
generated, manufactured, used, stored, handled, treated, spilled,
leaked, dumped, discharged, released or disposed of, or arranged for
any third parties to generate, manufacture, use, store, handle, treat,
spill, leak, dump, discharge, release or dispose of, any material
quantities of Hazardous Substances or other waste upon property
currently or previously owned or leased by it, except in compliance
with Environmental Laws.
(f) The Company has not caused a Release or Discharge of
any material quantity of Hazardous Substance on, into or beneath the
surface of the Leased Properties or to any properties adjacent thereto
except in compliance with the Environmental laws. There has not
occurred, nor is there presently occurring, a Release or Discharge, or
threatened Release or Discharge, of any Hazardous Substance on, into
or beneath the surface of the Leased Properties or to any properties
adjacent thereto.
(g) The Company has not generated, handled, manufactured,
treated, stored, used, shipped, transported, transferred, or disposed
of, nor has it allowed or arranged, by contract, agreement or
otherwise, for any third parties to generate, handle, manufacture,
treat, store, use, ship, transport, transfer or dispose of, any
material quantity of Hazardous Substance or other Waste to or at a
site which, pursuant to CERCLA or any similar state law (i) has been
placed on the National Priorities List or its state equivalent; or
(ii) the Environmental Protection Agency or the relevant state agency
has notified the Company that it has proposed or is proposing to place
on the National Priorities List or its state equivalent. Neither the
Company nor the Stockholder have received notice or have knowledge of
any facts which could give rise to any notice, that the Company is a
potentially responsible party for a federal or state environmental
cleanup site or for corrective action under CERCLA, RCRA or any other
applicable Environmental Laws. The Company has not submitted nor was
required to submit any notice pursuant to Section 103(c) of CERCLA
with respect to any properties owned by, or used in the business of,
the Company. The Company has not received any written or, to the
knowledge of the Company or the Stockholder, oral request for
information in connection with any federal or state environmental
cleanup site, or in connection with any of the real property or
premises where the Company has transported, transferred or disposed of
other Wastes. The Company has not been required to nor has undertaken
any response or remedial actions or clean-up actions at the request of
any Governmental Authorities or at the request of any other third
party. The Company has no liability under any Environmental Laws for
personal injury, property damage, natural resource damage, or clean up
obligations.
(h) The Company has no Aboveground Storage Tanks or
Underground Storage Tanks, except as listed in Schedule 3.19(h).
(i) The following have been made available to Group 1
regardless of their materiality, (i) all environmental audits,
assessments or occupational health studies of which
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14
the Company or the Stockholder are aware undertaken by the Company or
their agents, or by the Stockholder, or by any Governmental Authority,
or by any third party, relating to the Company, or any of the Leased
Properties; (ii) the results of which the Company or the Stockholder
are aware of any ground, water, soil, air or asbestos monitoring
undertaken by the Company or its agents, or by the Stockholder, or by
any Governmental Authority, or by any third party, relating to the
Company, or any of the Leased Properties; (iii) all written
communications between the Company and any Governmental Authority
arising under or related to Environmental, Laws; and (iv) all
citations issued under OSHA, or similar state or local statutes, laws,
ordinances, codes, rules, regulations, orders, rulings, or decrees,
relating to or affecting the Company, or any of the Leased Properties.
(j) Schedule 3.19(j) contains a list of the assets of the
Company which contain "asbestos" or "asbestos-containing material" (as
such terms are identified under the Environmental Laws). Except as
set forth in Schedule 3.19(j), the Company has operated and continue
to operate in compliance with all Environmental Laws governing the
handling, use and exposure to and disposal of asbestos or
asbestos-containing materials. Except as set forth in Schedule
3.19(j), there are no claims, actions, suits, governmental
investigations or proceedings before any Governmental Authority or
third party pending, or threatened against or directly affecting the
Company or any of its assets or operations relating to the use,
handling or exposure to and disposal of asbestos or
asbestos-containing materials in connection with their assets and
operations.
3.20 Intellectual Property. Except as set forth in Schedule 3.20,
the Company owns, or is licensed or otherwise has the right to use all
Intellectual Property that is necessary for the conduct of the business and
operations of the Company as currently conducted. To the knowledge of the
Company and the Stockholder, (a) the use of the Intellectual Property by the
Company does not infringe on the rights of any Person, and (b) no Person is
infringing on any right of the Company with respect to any Intellectual
Property. No claims are pending or, to the knowledge of the Company and the
Stockholder threatened that the Company is infringing or otherwise adversely
affecting the rights of any Person with regard to any Intellectual Property.
To the knowledge of the Company and the Stockholder, no Person is infringing
the rights of the Company with respect to any Intellectual Property. All of
the Intellectual Property that is owned by the Company is owned free and clear
of all encumbrances and was not misappropriated from any Person. All of the
Intellectual Property that is licensed by the Company is licensed pursuant to
valid and existing license agreements. The consummation of the transactions
contemplated by this Agreement will not result in the loss of any Intellectual
Property.
3.21 Bank Accounts. Schedule 3.21 includes the names and locations
of all banks in which the Company has an account or safe deposit box and the
names of all Persons authorized to draw thereon or to have access thereto.
3.22 Brokers. No broker, finder, investment banker or other person
is entitled to any brokerage, finder's or other fee, commission or payment in
connection with the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of the Company.
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3.23 Disclosure. The Company has disclosed in writing, or pursuant
to this Agreement and the Schedules attached hereto, all facts material to the
business, assets, prospects and condition (financial or otherwise) of the
Company. No representation or warranty to Group 1 by the Stockholder contained
in this Agreement, and no statement contained in the Schedules attached hereto,
any certificate, list or other writing furnished to Group 1 by the Stockholder
pursuant to the provisions hereof or in connection with the transactions
contemplated hereby, contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements herein or
therein not misleading. All statements contained in this Agreement, the
Schedules attached hereto, and any certificate, list, document or other writing
delivered pursuant hereto or in connection with the transactions contemplated
hereby shall be deemed a representation and warranty of the Stockholder for all
purposes of this Agreement.
ARTICLE IV
ADDITIONAL REPRESENTATIONS AND
WARRANTIES OF THE STOCKHOLDER
The Stockholder further represents and warrants to Group 1 that:
4.1 Capital Stock. The Stockholder is the beneficial and record
Stockholder of 1,000 shares of Common Stock of the Company, free and clear of
any lien, claim, pledge, encumbrance or other adverse claim. The Stockholder
does not own, beneficially or of record, any capital stock or other security,
including without limitation any option, warrant or right entitling the holder
thereof to purchase or otherwise acquire any shares of capital stock of the
Company.
4.2 Authorization of Agreement.
(a) The Stockholder has full legal right, power, capacity
and authority to execute, deliver and perform its obligations pursuant
to this Agreement and to execute, deliver and perform its obligations
under each instrument, document or agreement required hereby to be
executed and delivered by the Stockholder at, or prior to, the
Closing.
(b) This Agreement has been, and each instrument,
document or agreement required hereby to be executed and delivered by
the Stockholder at, or prior to, the Closing will then be, duly
executed and delivered by the Stockholder, and this Agreement
constitutes and, to the extent it purports to obligate the
Stockholder, each such instrument, document or agreement will
constitute (assuming due authorization, execution and delivery by each
other party thereto), the legal, valid and binding obligation of the
Stockholder enforceable against him in accordance with its terms.
4.3 Approvals. No filing or registration with, and no consent,
approval, authorization, permit, certificate or order of any Court or
Governmental Authority is required by any applicable Law or by any applicable
Order or any applicable rule or regulation of any Court or Governmental
Authority to permit the Stockholder to execute, deliver or perform this
Agreement or any instrument required hereby to be executed and delivered by him
at the Closing.
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4.4 Absence of Conflicts. Except to the extent set forth in
Schedule 4.4, neither the execution and delivery by the Stockholder of this
Agreement or any instrument, document or agreement required hereby to be
executed and delivered by him at, or prior to, the Closing, nor the performance
by the Stockholder of his obligations under this Agreement or any such
instrument will (a) violate or breach the terms of or cause a default under (i)
any applicable Law, (ii) any applicable Order or any applicable rule or
regulation of any Court or Governmental Authority, or (iii) any contract or
agreement to which the Stockholder is a party or by which he, or any of his
properties, is bound, or (b) result in the creation or imposition of any Lien
on any of the properties or assets of the Stockholder, or (c) result in the
cancellation, forfeiture, revocation, suspension or adverse modification of any
existing consent, approval, authorization, license, permit, certificate or
order of any Court or Governmental Authority, or (d) with the passage of time
or the giving of notice or the taking of any action of any third party have any
of the effects set forth in clause (a), (b) or (c) of this Section.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF GROUP 1
Group 1 hereby represents and warrants to the Stockholder that:
5.1 Corporate Organization. Group 1 is a corporation duly
organized, validly existing and in good standing under the laws of Delaware
with all requisite corporate power and authority to execute, deliver and
perform this Agreement and each instrument required hereby to be executed and
delivered by it at the Closing.
5.2 Authorization. The execution and delivery by Group 1of this
Agreement, the performance by Group 1 of its obligations pursuant to this
Agreement, and the execution, delivery and performance of each instrument
required hereby to be executed and delivered by Group 1 at the Closing have
been duly and validly authorized by all requisite corporate action on the part
of Group 1. This Agreement has been, and each instrument, document or
agreement required hereby to be executed and delivered by Group 1 at, or prior
to, the Closing will then be, duly executed and delivered by Group 1. This
Agreement constitutes, and, to the extent it purports to obligate Group 1, each
such instrument, document or agreement will constitute (assuming due
authorization, execution and delivery by each other party thereto), the legal,
valid and binding obligation of Group 1, enforceable against it in accordance
with its terms.
5.3 Approvals. No filing or registration with, and no consent,
approval, authorization, permit, certificate or order of any Court or
Government Authority is required by any applicable Law or by any applicable
Order or any applicable rule or regulation of any Court or Governmental
Authority to permit Group 1 to execute, deliver or consummate the transactions
contemplated by this Agreement or any instrument required hereby to be executed
and delivered by Group 1 at or prior to the Closing.
5.4 Absence of Conflicts. Neither the execution and delivery by
Group 1 of this Agreement or any instrument required hereby to be executed by
it at or prior to the Closing nor the
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performance by Group 1 of its obligations under this Agreement or any such
instrument will (a) violate or breach the terms of or cause a default under (i)
any applicable Order or any applicable rule or regulation of any Court or
Governmental Authority, (ii) the organizational documents of Group 1 or (iii)
any contract or agreement to which Group 1 is a party or by which it or any of
its property is bound, or (b) result in the creation or imposition of any Liens
on any of the properties or assets of Group 1 (other than any Lien created by
the Company), or (c) result in the cancellation, forfeiture, revocation,
suspension or adverse modification of any existing consent, approval,
authorization, license, permit certificate or order of any Court or
Governmental Authority or (d) with the passage of time or the giving of notice
or the taking of any action by any third party have any of the effects set
forth in clause (a), (b) or (c) of this Section, except, with respect to
clauses (a), (b), (c) or (d) of this Section, where such matter would not have
a material adverse effect on the business, assets, prospects or condition
(financial or otherwise) of Group 1 and its subsidiaries, taken as a whole.
ARTICLE VI
COVENANTS OF THE STOCKHOLDER
6.1 Acquisition Proposals. Prior to the Closing Date, neither the
Company nor any of its officers, directors, employees or agents nor any
Stockholder shall agree to, solicit or encourage inquiries or proposals with
respect to, furnish any information relating to, or participate in any
negotiations or discussions concerning, any acquisition, business combination
or purchase of all or a substantial portion of the assets of, or a substantial
equity interest in, the Company, other than the transactions with Group 1
contemplated by this Agreement.
6.2 Access. The Company shall afford Group 1's officers,
employees, counsel, accountants and other authorized representatives access,
during normal business hours throughout the period prior to the Closing Date,
to all its properties, books, contracts, commitments and records and, during
such period, the Company shall furnish promptly to Group 1 any information
concerning its business, properties and personnel as Group 1 may reasonably
request; provided, however, that no investigation pursuant to this Section or
otherwise shall affect or be deemed to modify any representation or warranty
made by the Stockholder pursuant to this Agreement.
6.3 Conduct of Business by the Company Pending the Acquisition.
The Stockholder covenant and agree that, from the date of this Agreement until
the Closing Date, unless Group 1 shall otherwise agree in writing or as
otherwise expressly contemplated by this Agreement:
(a) The business of the Company shall be conducted only
in, and the Company shall not take any action except in, the ordinary
course of business and consistent with past practice. In connection
therewith, the parties agree that the Company may dealer trade
vehicles for similar models, but the Company shall not liquidate or
otherwise dispose of any of its new vehicles other than in the
ordinary course of business to retail buyers. The Company shall
maintain its advertising expenditures and activities commensurate with
prior business practices. The Company shall not advertise a "Going
Out of Business" sale;
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(b) The Company shall not, directly or indirectly do any
of the following: (i) issue, sell, pledge, dispose of or encumber, (A)
any capital stock (or securities convertible into capital stock) of
the Company or (B) other than in the ordinary course of business and
consistent with past practice and not relating to the borrowing of
money, any assets of the Company, (ii) amend or propose to amend the
articles of incorporation or bylaws (or other organizational
documents) of the Company, (iii) split, combine or reclassify any
outstanding capital stock of the Company or declare, set aside or pay
any dividend payable in cash, stock, property or otherwise with
respect to the capital stock of the Company whether now or hereafter
outstanding, (iv) redeem, purchase or acquire or offer to acquire any
of the capital stock of the Company, (v) create, incur, assume,
guarantee or otherwise become liable or obligated with respect to any
indebtedness for borrowed money (other than floor plan indebtedness
incurred in the ordinary course of business), or (vi) except in the
ordinary course of business and consistent with past practice, enter
into any contract, agreement, commitment or arrangement with respect
to any of the matters set forth in this Section 6.3(b);
(c) The Company shall use its best efforts (i) to
preserve intact the business organization of the Company, (ii) to
maintain in effect any franchises, authorizations or similar rights of
the Company, (iii) to keep available the services of its current
officers and key employees, (iv) to preserve the goodwill of those
having business relationships with it, (v) to maintain and keep its
properties in as good a repair and condition as presently exists,
except for deterioration due to ordinary wear and tear, (vi) to
maintain in full force and effect insurance comparable in amount and
scope of coverage to that currently maintained by it, (vii) to collect
its accounts receivable, (viii) to preserve in full force and effect
all leases, operating agreements, easements, rights-of-way, permits,
licenses, contracts and other agreements which relate to its assets
(other than those expiring by their terms), and (ix) to perform or
cause to be performed all of its obligations in or under any of such
leases, agreements and contracts.
(d) The Company shall not make or agree to make any
single capital expenditure or enter into any purchase commitments in
excess of $50,000;
(e) The Company shall perform its obligations under any
contracts and agreements to which it is a party or to which its assets
are subject, except for such obligations as the Company in good faith
may dispute;
(f) The Company shall not increase the salary, benefits,
stock options, bonus or other compensation of any officer, director or
employee of the Company other than normal, annual compensation
increases consistent with the Company's past practices; and shall not
grant, to any individual, severance or termination pay that exceeds
the lesser of (i) such individual's compensation for the calendar
month immediately preceding such individual's grant of severance or
termination pay, or (ii) $5,000;
(g) The Company shall not take any action that would, or
that reasonably could be expected to, result in any of the
representations and warranties set forth in this Agreement becoming
untrue or any of the conditions to the Acquisition set forth in
Article VIII not being satisfied; provided, however, that no such
notification shall affect the representations or
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warranties or covenants or agreements of the parties or the conditions
to the obligations of the parties hereunder;
(h) The Company shall not adopt or enter into any
personnel policy, stock option plan, collective bargaining agreement,
bonus plan or arrangement, incentive award plan or arrangement,
vacation policy, severance pay plan, policy or agreement, deferred
compensation agreement or arrangement, executive compensation or
supplemental income arrangement, consulting agreement, employment
agreement or any other employee benefit plan, agreement, arrangement,
program, practice or understanding;
(i) The Company shall not enter into any agreement or
incur any obligation, the terms of which would be violated by the
consummation of the transactions contemplated by this Agreement; and
6.4 Notification of Certain Matters. The Company shall give
prompt notice to Group 1, orally and in writing, of (i) the occurrence, or
failure to occur, of any event which occurrence or failure would be likely to
cause any representation or warranty contained in this Agreement to be untrue
or inaccurate at any time from the date hereof to the Closing, (ii) any failure
of the Company, or any officer, director, employee or agent thereof, or the
Stockholder to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder, or (iii) any litigation, or any
claim or controversy or contingent liability of which the Company or the
Stockholder has knowledge of that might reasonably be expected to become the
subject of litigation, against the Company or affecting any of their assets, in
each case in an amount in controversy in excess of $50,000, or that is seeking
to prohibit or restrict the transactions contemplated hereby.
6.5 Consents. Subject to the terms and conditions of this
Agreement, the Company shall (i) obtain all consents, waivers, approvals
(including all applicable automobile manufacturers approvals, and such
approvals shall not contain any unreasonably burdensome restrictions on the
Company or Group 1), authorizations and orders required in connection with the
authorization, execution and delivery of this Agreement and the consummation of
the Acquisition; and (ii) take, or cause to be taken, all appropriate action,
and do, or cause to be done, all things necessary or proper to consummate and
make effective as promptly as practicable the transactions contemplated by this
Agreement.
6.6 Removal of Related Party Guarantees. The Stockholder agree to
take, or cause to be taken, all appropriate action, and do, or cause to be
done, all things necessary, proper or advisable to terminate, waive or release
all Company guarantees (such guarantees shall be referred to herein as "Related
Guarantees", as described in Schedule 6.6 pursuant to Section 3.9 of this
Agreement) of indebtedness or other obligations of any of the Company's
officers, directors, shareholders or employees or their affiliates.
6.7 Termination of Related Party Agreements. The Stockholder
agree to take, or cause to be taken, all appropriate action, and do, or cause
to be done, all things necessary, proper or advisable to terminate the Related
Party Agreements except those Related Party Agreements that are disclosed in
Schedule 6.7 as agreements that shall not be subject to this Section 6.7.
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6.8 Related Party Agreements. The Stockholder agrees to cause the
Company not to enter into any Related Party Agreements or engage in any
transactions with the Stockholder or his affiliates; except for those Related
Party Agreements or transactions with affiliates that are disclosed in Schedule
6.8 as agreements or transactions that shall not be subject to this Section
6.8.
ARTICLE VII
COVENANTS OF GROUP 1
7.1 Consents. Subject to the terms and conditions of this
Agreement, Group 1 shall (i) obtain all consents, waivers, approvals,
authorizations and orders required in connection with the authorization,
execution and delivery of this Agreement and the consummation of the
Acquisition; and (ii) take, or cause to be taken, all appropriate action, and
do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective as promptly as practicable the transactions
contemplated by this Agreement.
ARTICLE VIII
CONDITIONS
8.1 Conditions Precedent to Obligation of Each Party to Effect the
Acquisition. The respective obligations of each party to effect the
Acquisition shall be subject to the fulfillment at or prior to the Closing Date
of the following conditions:
(a) No Order shall have been entered and remain in effect
in any action or proceeding before any Court or Governmental Authority
that would prevent or make illegal the consummation of the
Acquisition;
(b) There shall have been obtained any and all permits,
approvals and consents of any governmental agency or authority, with
respect to the consummation of the Acquisition;
8.2 Additional Conditions Precedent to Obligations of Group 1.
The obligation of Group 1 to effect the Acquisition is also subject to the
fulfillment at or prior to the Closing Date of the following conditions:
(a) The representations and warranties of the Stockholder
contained in Article III and Article IV, respectively, shall be true
and correct in all respects as of the date when made and as of the
Closing Date as though such representations and warranties had been
made at and as of the Closing Date; all of the terms, covenants and
conditions of this Agreement to be complied with and performed by the
Company and the Stockholder on or before the Closing Date shall have
been duly complied with and performed in all respects, and a
certificate to the foregoing effect dated the Closing Date and signed
by the Stockholder shall have been delivered to Group 1.
(b) There shall have been obtained any and all permits,
approvals and consents of securities or blue sky commissions of any
jurisdiction, and of any other Governmental
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Authority and of any automobile manufacturer, that reasonably may be
deemed necessary so that the consummation of the Acquisition and the
transactions contemplated thereby will be in compliance with
applicable laws.
(c) Group 1 shall have received evidence, satisfactory to
Group 1, that all Related Party Agreements shall have been terminated
and all Related Guarantees shall have been terminated, waived or
released pursuant to Sections 6.6 and 6.7 hereto.
(d) Since the date of this Agreement, no material adverse
change in the business, condition (financial or otherwise), assets,
operations or prospects of the Company shall have occurred, and the
Company shall not have suffered any damage, destruction or loss
(whether or not covered by insurance) materially adversely affecting
the properties or business of the Company and Group 1 shall have
received a certificate signed by the Stockholder dated the Closing
Date to such effect.
8.3 Additional Conditions Precedent to Obligations of the
Stockholder. The obligation of the Stockholder to effect the Acquisition is
also subject to the fulfillment at or prior to the Closing Date of the
following condition:
(a) The representations and warranties of Group 1
contained in Article V shall be true and correct in all respects as of
the date when made and as of the Closing Date as though such
representations and warranties had been made at and as of the Closing
Date; all the terms, covenants and conditions of this Agreement to be
complied with and performed by Group 1 on or before the Closing Date
shall have been duly complied with and performed in all material
respects; and a certificate to the foregoing effect dated the Closing
Date and signed by the chief executive officer of Group 1 shall have
been delivered to the Stockholder.
ARTICLE IX
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
9.1 Survival. The representations, warranties and agreements in
this Agreement shall terminate at Closing.
ARTICLE X
MISCELLANEOUS
10.1 Schedules to this Agreement. The Schedules to this Agreement,
contain all disclosure required to be made by the Stockholder under the various
terms and provisions of this Agreement.
10.2 Termination. This Agreement may be terminated and the
Acquisition and the other transactions contemplated herein may be abandoned at
any time prior to the Closing:
(a) by mutual consent of Group 1 and the Stockholder;
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(b) by either Group 1 or the Stockholder if the
Acquisition has not been effected on or before February 28, 1998;
(c) by Group 1 if the information disclosed on the
Schedules or the results of Group 1's general due diligence
investigation are not satisfactory to Group 1 in its sole discretion;
provided, however, that Group 1's right to terminate under this
Section 10.2(c) shall expire at midnight on January 31, 1998;
(d) by either Group 1 or the Stockholder if a final,
unappealable order to restrain, enjoin or otherwise prevent, or
awarding substantial damages in connection with, a consummation of the
Acquisition or the other transactions contemplated hereby shall have
been entered;
(e) by Group 1 if (i) since the date of this Agreement
there has been a material adverse change in the business operations or
financial condition of the Company; (ii) there has been a material
breach of any representation, warranty, covenant or other agreement
set forth in this Agreement by the Company or the Stockholder which
breach has not been cured within ten business days following receipt
by the Company of notice of such breach (or if such breach cannot be
cured within such time, reasonable efforts have begun to cure such
breach and such breach is then cured within 30 days after notice) or
(iii) there is a material adverse change in the pre-tax income
expected for the Company, on which the purchase price of the
acquisition was based; or
(f) by the Stockholder if there has been a material
breach of any representation or warranty set forth in this Agreement
by Group 1 which breach has not been cured within ten business days
following receipt by Group 1 of notice of such breach (or if such
breach cannot be cured within such time, reasonable efforts have begun
to cure such breach and such breach is then cured within 30 days after
notice).
10.3 Effect of Termination. In the event of any termination of
this Agreement pursuant to Section 10.2, the Stockholder and Group 1 shall have
no obligation or liability to each other except that the provisions of Section
10.4 survive any such termination.
10.4 Expenses. Regardless of whether the Acquisition is
consummated, all costs and expenses in connection with this Agreement and the
transactions contemplated hereby shall be paid by Group 1. The Stockholder and
Group 1 each represent and warrant to each other that there is no broker or
finder involved in the transactions contemplated hereby.
10.5 Waiver and Amendment. Any provision of this Agreement may be
waived at any time by the party that is entitled to the benefits thereof. This
Agreement may not be amended or supplemented at any time, except by an
instrument in writing signed on behalf of each party hereto. The waiver by any
party hereto of any condition or of a breach of another provision of this
Agreement shall not operate or be construed as a waiver of any other condition
or subsequent breach. The waiver by any party hereto of any of the conditions
precedent to its obligations under this Agreement shall not preclude it from
seeking redress for breach of this Agreement other than with respect to the
condition so waived.
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10.6 Assignment. This Agreement shall inure to the benefit of and
will be binding upon the parties hereto and their respective legal
representatives, successors and permitted assigns. This Agreement shall not be
assignable by the parties hereto without the written consent of the other
parties hereto.
10.7 Notices. All notices, requests, demands, claims and other
communications which are required to be or may be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (i)
delivered in person or by courier, (ii) sent by telecopy or facsimile
transmission, answer back requested, or (iii) mailed, by registered or
certified mail, postage prepaid, return receipt requested, to the parties
hereto at the following addresses:
if to the Stockholder: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
if to Group 1: ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇.
Chairman, President and Chief
Executive Officer
with a copy to: ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
or to such other address as any party shall have furnished to the other by
notice given in accordance with this Section 10.7. Such notices shall be
effective, (i) if delivered in person or by courier, upon actual receipt by the
intended recipient, (ii) if sent by telecopy or facsimile transmission, when
the answer back is received, or (iii) if mailed, upon the earlier of five days
after deposit in the mail and the date of delivery as shown by the return
receipt therefor.
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10.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, excluding any
choice of law rules that may direct the application of the laws of another
jurisdiction.
10.9 Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provision, covenants and
restrictions of this Agreement shall continue in full force and effect and
shall in no way be affected, impaired or invalidated unless such an
interpretation would materially alter the rights and privileges of any party
hereto or materially alter the terms of the transactions contemplated hereby.
10.10 Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, but all of which together shall constitute
one and the same agreement.
10.11 Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10.12 Third Party Beneficiaries. Neither this agreement nor any
document delivered in connection with this Agreement, confers upon any Person
not a party hereto any rights or remedies hereunder.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed on its behalf by its officers thereunto duly authorized, all as of
the date first above written.
GROUP 1 AUTOMOTIVE, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
STOCKHOLDER
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇
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ANNEX A
SCHEDULE OF DEFINED TERMS
The following terms when used in the Agreement shall have the meanings
set forth below unless the context shall otherwise require:
"Aboveground Storage Tanks" and "Underground Storage Tanks" shall have
the meanings given them in Section 6901 et seq., as amended, of RCRA, or any
applicable state or local statute, law, ordinance, code, rule, regulation,
order ruling, or decree, as in effect as of the Closing Date, governing
Aboveground Storage Tanks or Underground Storage Tanks.
"affiliate" shall mean, with respect to any specified Person, any
other Person who directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, such specified
Person.
"Agreement" shall mean the Stock Purchase Agreement made and entered
into as of December 30, 1997 by and between Group 1and the Stockholder,
including any amendments thereto and each Annex (including this Annex A),
Exhibit and schedule thereto (including the Schedules).
"Assets" shall mean all of the properties and assets owned by the
Company, other than the Leased Properties, whether personal or mixed, tangible
or intangible, wherever located.
"Business Day" means any day other than a day on which banks in the
State of Texas are authorized or obligated to be closed.
"Closing" shall mean a meeting, which shall be held in accordance with
Section 2.2, of representatives of the parties to the Agreement at which, among
other things, all documents deemed necessary by the parties to the Agreement to
evidence the fulfillment or waiver of all conditions precedent to the
consummation of the transactions contemplated by the Agreement are executed and
delivered.
"Closing Date" shall mean the date of the Closing as determined
pursuant to Section 2.2.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the rules and regulations promulgated thereunder.
"Company" shall mean ▇▇▇ ▇▇▇▇▇▇ Nissan, Inc., an Oklahoma corporation,
all predecessor entities of the Company and its successors from time to time.
"Common Stock" shall mean the common stock, par value $1.00 per share,
of the Company.
"control" (including the terms "controlled," "controlled by" and
"under common control with") means the possession, directly or indirectly or as
trustee or executor, of the power to direct
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or cause the direction of the management or policies of a Person, whether
through the ownership of stock or as trustee or executor, by contract or credit
arrangement or otherwise.
"Court" shall mean any court or arbitration tribunal of the United
States, any foreign country or any domestic or foreign state, and any political
subdivision thereof, and shall include the European Court of Justice.
"Environmental Laws" shall mean all federal, state, regional or local
statutes, laws, rules, regulations, codes, orders, plans, injunctions, decrees,
rulings, and changes or ordinances or judicial or administrative
interpretations thereof, as in effect on the Closing Date, any of which govern
or relate to pollution, protection of the environment, public health and
safety, air emissions, water discharges, hazardous or toxic substances, solid
or hazardous waste or occupational health and safety, as any of these terms are
in such statutes, laws, rules, regulations, codes, orders, plans, injunctions,
decrees, rulings and changes or ordinances, or judicial or administrative
interpretations thereof, including, without limitation, RCRA, CERCLA, the
Hazardous Materials Transportation Act, the Toxic Substances Control Act, the
Clean Air Act, the Clean Water Act, FIFRA, EPCRA and OSHA.
"Fixed Assets" shall mean all vehicles, machinery, equipment, tools,
supplies, leasehold improvements, furniture and fixtures owned by the Company
or set forth on the Interim Balance Sheet or acquired by the Company since the
date of the Interim Balance Sheet.
"GAAP" shall mean accounting principles generally accepted in the
United States as in effect from time to time consistently applied by a
specified Person.
"Governmental Authority" shall mean any governmental agency or
authority (other than a Court) of the United States, any foreign country, or
any domestic or foreign state, and any political subdivision thereof, and shall
include any multinational authority having governmental or quasi-governmental
powers.
"Guarantees" shall have the meaning set forth in Section 3.9 herein.
"Hazardous Substance" shall mean any toxic or hazardous substance,
material, or waste, and any other contaminant, pollutant or constituent
thereof, whether liquid, solid, semi-solid, sludge and/or gaseous, including
without limitation, chemicals, compounds, metals, by-products, pesticides,
asbestos containing materials, petroleum or petroleum products, and
polychlorinated biphenyls, the presence of which requires remediation under any
Environmental, Health and Safety Laws in effect on the Closing Date, including,
without limitation, the United States Department of Transportation Table (49
CFR 172, 101) or by the Environmental Protection Agency as hazardous substances
(40 CFR Part 302) and any amendments thereto; the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendment and Reauthorization Act of 1986, 42 U.S.C. Section 9601, et seq.
(hereinafter collectively "CERCLA"); the Solid Waste Disposal Act, as amended
by the Resource Conversation and Recovery Act of 1976 and subsequent Hazardous
and Solid Waste Amendments of 1984, 42 U.S.C. Section 6901 et seq.
(hereinafter, collectively "RCRA"); the Hazardous Materials Transportation Act,
as amended, 49 U.S.C. Section 1801, et seq.; the Clean Water Act, as amended,
33 U.S.C. Section 1311, et seq.; the Clean Air Act, as amended
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(42 U.S.C. Section 7401-7642); Toxic Substances Control Act, as amended, 15
U.S.C. Section 2601 et seq.; the Federal Insecticide, Fungicide, and
Rodenticide Act as amended, 7 U.S.C. Section 136-136y ("FIFRA"); the Emergency
Planning and Community Right-to-Know Act of 1986 as amended, 42 U.S.C. Section
11001, et seq. (Title III of ▇▇▇▇) ("EPCRA"); the Occupational Safety and
Health Act of 1970, as amended, 29 U.S.C. Section 651, et seq. ("OSHA"); any
similar state statute or regulations implementing such statutes, laws,
ordinances, codes, rules, regulations, orders, rulings, or decrees, or which
has been or shall be determined or interpreted at any time by any Governmental
Authority to be a hazardous or toxic substance regulated under any other
statute, law, regulation, order, code, rule, order, or decree.
"Intellectual Property" shall mean all patents, trademarks, copyrights
and other proprietary rights.
"IRS" shall mean the Internal Revenue Service.
"Law" shall mean all laws, statutes, ordinances, rules and regulations
of the United States, any foreign country, or any domestic or foreign state,
and any political subdivision or agency thereof, including all decisions of
Courts having the effect of law in each such jurisdiction.
"Leased Property" and "Leased Properties" have the meaning set forth
in Section 3.16 herein.
"Licenses" shall mean all licenses, certificates, permits, approvals
and registrations.
"Lien" shall mean any mortgage, pledge, security interest, adverse
claim, encumbrance, lien or charge of any kind (including any agreement to give
any of the foregoing), any conditional sale or other title retention agreement,
any lease in the nature thereof or the filing of or agreement to give any
financing statement under the Law of any jurisdiction.
"Material Contract" has the meaning set forth in Section 3.9 herein.
"Material Leases" shall have the meaning set forth in Section 3.9
herein.
"Order" shall mean any judgment, order or decree of any Court or
Governmental Authority, federal, foreign, state or local.
"Permitted Encumbrances" shall mean the following:
(1) liens for taxes, assessments and other governmental
charges not delinquent or which are currently being contested in good
faith by appropriate proceedings; provided that, in the latter case,
the specified Person shall have set aside on its books adequate
reserves with respect thereto;
(2) mechanics' and materialmen's liens not filed of
record and similar charges not delinquent or which are filed of record
but are being contested in good faith by appropriate proceedings;
provided that, in the latter case, the specified Person shall have set
aside on its books adequate reserves with respect thereto;
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(3) liens in respect of judgments or awards with respect
to which the specified Person shall in good faith currently be
prosecuting an appeal or other proceeding for review and with respect
to which such Person shall have secured a stay of execution pending
such appeal or such proceeding for review; provided that such Person
shall have set aside on its books adequate reserves with respect
thereto;
(4) easements, leases, reservations or other rights of
others in, or minor defects and irregularities in title to, property
or assets of a specified Person; provided that such easements, leases,
reservations, rights, defects or irregularities do not materially
impair the use of such property or assets for the purposes for which
they are held; and
(5) any lien or privilege vested in any lessor, licensor
or permittor for rent or other obligations of a specified Person
thereunder so long as the payment of such rent or the performance of
such obligations is not delinquent.
"Person" shall mean an individual, partnership, limited liability
company, corporation, joint stock company, trust, estate, joint venture,
association or unincorporated organization, or any other form of business or
professional entity, but shall not include a Court or Governmental Authority.
"Related Party Agreements" shall have the meaning set forth in Section
3.19 herein.
"Release" and "Discharge" shall have the meanings given them in the
Environmental, Health and Safety Laws
"Reports" shall mean, with respect to a specified Person, all reports,
registrations, filings and other documents and instruments required to be filed
by the specified Person or any of its Subsidiaries with any Governmental
Authority.
A "Subsidiary" of a specified Person shall be any corporation,
partnership, limited liability company, joint venture or other legal entity of
which the specified Person (either alone or through or together with any other
subsidiary) owns, directly or indirectly, 50% or more of the stock or other
equity or partnership interests the holders of which are generally entitled to
vote for the election of the board of directors or other governing body of such
corporation or other legal entity or of which the specified Person controls the
management.
"Tax Returns" shall mean all returns, reports and filings relating to
Taxes.
"Taxes" shall mean all taxes, charges, imposts, tariffs, fees, levies
or other similar assessments or liabilities, including income taxes, ad valorem
taxes, excise taxes, withholding taxes, stamp taxes or other taxes of or with
respect to gross receipts, premiums, real property, personal property, windfall
profits, sales, use, transfers, licensing, employment, payroll and franchises
imposed by or under any Law; and such terms shall include any interest, fines,
penalties, assessments or additions to tax resulting from, attributable to or
incurred in connection with any such tax or any contest or dispute thereof.
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"Waste" shall mean toxic agricultural wastes, biomedical wastes,
biological wastes, bulky wastes, construction and demolition debris, garbage,
household wastes, industrial solid wastes, liquid wastes, recyclable materials,
sludge, solid wastes, special wastes, used oils, white goods, and yard trash;
provided, however, the term "Waste" shall not include scrap metal.
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