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Exhibit 2.10
MERGER AGREEMENT
THIS MERGER AGREEMENT (this "Agreement") is entered into as of July 8,
1997, by and among FLORIDA PANTHERS HOLDINGS, INC., a Florida corporation
("Panthers"); FPH/RHI MERGER CORP., INC., a Florida corporation and a
wholly-owned subsidiary of Panthers ("FPH/RHI"); RESORTHILL, INC., an Illinois
corporation ("ResortHill"); and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, a resident of the State of
Illinois ("Chensoff"). Panthers, together with FPH/RHI, are collectively
referred to as the "Panther Companies" and individually as a "Panther Company".
RECITALS
A. LeHill Partners, L.P., a Delaware limited partnership
("LeHill" or "Partnership"), is the record fee simple title holder of 322
condominium units legally described on Schedule 3.12(a) attached hereto
("Units") being a part of The Registry Hotel at Pelican Bay, a Non-Residential
Hotel Condominium, according to the Declaration of Condominium thereof,
recorded in Official Records Book 1225, Page 696 of the Public Records of
▇▇▇▇▇▇▇ County, Florida ("Resort").
B. LeHill is the record holder of certain mortgages ("Mortgages")
and related promissory notes ("Notes") in the approximate aggregate outstanding
principal amount of $4,747,000 for the 36 performing Mortgages and an
approximate aggregate outstanding principal amount of $319,000 for the two
non-performing Mortgages as of July 1, 1997 and ancillary documents (together
with the Mortgages and the Notes, the "Loan Documents") more particularly
described on Schedule 3.12(a) attached hereto ("Mortgage Loans") encumbering
the condominium units within the Resort as set forth on the Schedule.
C. Pelican Hill Associates, L.P., a Delaware limited partnership
("Pelican Hill"), is the general partner of LeHill and owns a One percent (1%)
interest in LeHill.
D. ResortHill (i) is a general partner of Pelican Hill and owns a
Fifty percent (50%) interest in Pelican Hill and (ii) is a limited partner of
LeHill and owns a Three and eight-tenths percent (3.8%) percent interest in
LeHill.
▇. ▇▇▇▇▇▇▇▇ owns One Hundred percent (100%) of the outstanding
capital stock in ResortHill and has the power to vote One Hundred percent
(100%) of the outstanding voting interests of ResortHill, without the consent
of any other party.
▇. ▇▇▇▇▇▇▇ Capital, Inc., an Illinois corporation ("▇▇▇▇▇▇▇") is
the record owner of a Seven-tenths percent (7/10%) limited partnership interest
in LeHill and, to date, no transfer of such interest has been approved under
the terms of the LeHill partnership agreement.
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G. ▇▇-▇▇, Inc. is a Delaware corporation ("▇▇-▇▇") and is the
record owner of a Ninety-four and Five-tenths percent (94.5%) limited
partnership interest in LeHill and, to date, no transfer of such interest has
been approved under the terms of the LeHill partnership agreement.
H. NP Investment III Co. is a Delaware corporation ("NPI") and a
general partner of Pelican Hill and is the record owner of a Five-tenths
percent (0.5%) general partnership interest in Pelican Hill and, to date, no
transfer of such interest has been approved under the terms of the LeHill
partnership agreement.
I. LW-RTC, Inc. is a Delaware corporation ("LW-RTC") and is the
record owner of a Forty-Nine and Five-tenths percent (49.5%) limited
partnership interest in Pelican Hill and, to date, no transfer of such interest
has been approved under the terms of the LeHill partnership agreement.
▇. ▇▇▇▇▇▇▇▇ has the right and power to cause the sale and
transfer of ▇▇▇▇▇▇▇'▇ Seven-tenths percent (0.7%) limited partnership interest
in LeHill (the "▇▇▇▇▇▇▇ Interest") by virtue of a power of attorney given to
Chensoff by ▇▇▇▇▇▇▇.
▇. ▇▇▇▇▇▇▇▇ entered into a Purchase Agreement with ▇▇-▇▇, NPI and
LW-RTC (the "▇▇▇▇▇▇ Purchase Agreement") dated as of May 19, 1997 pursuant to
which ▇▇-▇▇, NPI and LW-RTC agreed to sell to Chensoff all of their general and
limited partnership interest in LeHill and Pelican Hill consisting of LW-LP's
94.5% limited partnership interest in LeHill, NPI's 0.5% general partnership
interest in Pelican Hill and LW-RTC's 49.5% limited partnership interest in
Pelican Hill, a true and correct copy of which is attached hereto on Exhibit
"A".
▇. ▇▇▇▇▇▇▇▇ has agreed to execute an Assignment, Assumption,
Contribution and Consent Agreement ("Assignment and Assumption") in the form
attached hereto as Exhibit "B" that assigns Chensoff's rights under the ▇▇▇▇▇▇
Purchase Agreement to Panthers and which by virtue of its terms reinstates the
substantive provisions of the ▇▇▇▇▇▇ Purchase Agreement so that such agreement
remains enforceable against Chensoff by its terms and which ▇▇-▇▇, NPI and LW-
RTC has represented is enforceable by its terms against them. Chensoff has also
agreed to execute, or to cause the delivery by ▇▇▇▇▇▇▇ of a duly executed
assignment or ▇▇▇▇ of sale (the "▇▇▇▇▇▇▇ Assignment") to transfer and assign to
Panthers the ▇▇▇▇▇▇▇ Interest.
M. Simultaneous with the execution of this Agreement, ▇▇-▇▇, NPI
and LW-RTC have consented to the assignment of the ▇▇▇▇▇▇ Purchase Agreement by
Chensoff to Panthers.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained herein and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
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TERMS OF AGREEMENT
In consideration of the mutual representations, warranties, covenants
and agreements contained herein, the parties hereto agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. Subject to the terms and conditions of this
Agreement and in accordance with the Business Corporation Act of the State of
Florida (the "Corporations Code"), at the Effective Time (as defined below)
pursuant to the terms and conditions set forth in the Plan of Merger and
Reorganization annexed hereto as Exhibit C (the "Plan of Merger"), FPH/RHI will
be merged with and into ResortHill (the "Merger"). The terms and conditions of
the Plan of Merger are incorporated herein by reference as if fully set forth
herein. As a result of the Merger, the separate corporate existence of FPH/RHI
shall cease and ResortHill shall continue as the surviving corporation and a
wholly-owned subsidiary of Panthers.
1.2 THE CLOSING. Subject to the terms and conditions of this
Agreement, the consummation of the Merger (the "Closing") shall take place as
promptly as practicable (and in any event within five (5) business days) after
satisfaction or waiver of the conditions set forth in Articles VI and VII, at
the offices of Panthers' counsel, Akerman, Senterfitt & ▇▇▇▇▇▇, P.A., Miami,
Florida, or such other time and place as the parties may otherwise agree (the
"Closing Date"). The parties agree that the Closing shall not occur before
August 1, 1997 except upon the mutual agreement of the parties.
1.3 COMPLETION OF PLANS OF MERGER; MERGER CONSIDERATION. At least
three days prior to the Closing, the parties shall fill in and complete the
blank spaces in Article III of the Plan of Merger. Pursuant to the Plan of
Merger, Panthers will pay an amount ("Merger Consideration") equal to
$96,821,400 (subject to any adjustment pursuant to Section 1.7) ("Base
Amount"), minus the sum of (i) the amount payable by Panthers pursuant to the
▇▇▇▇▇▇ Purchase Agreement with credit given for the $5,000,000 previously paid
by Panthers to ▇▇-▇▇, NPI and LW-RTC in connection with the execution by the
parties of the Assignment and Assumption, and (ii) the amount payable for the
▇▇▇▇▇▇▇ Interest (if such interest is purchased directly by Panthers) and (iii)
the amount of outstanding partners loans, third party loans or any other
indebtedness or liabilities of the LeHill Companies, including, without
limitation, the amount of all outstanding liabilities included in the balance
sheet of the Audited LeHill Financial Statements and included in the Closing
Balance Sheet such reduction to be made only to the extent that Chensoff has
not instructed Panthers to remit a portion of the Merger Consideration in
satisfaction of any such indebtedness or liabilities. The parties hereto
acknowledge that LeHill's liability for 1997 real property taxes in respect of
the Units shall be a liability assumed by Panthers for which no reduction in
the Merger Consideration shall be made. The Merger Consideration will be paid
(a) in cash in the amount of $3,000,000 less any
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cash amounts paid to ▇▇▇▇▇▇▇ by Panthers and (b) the balance in the form of
shares of the Class A common stock, $0.01 par value per share, of Panthers
("Panthers Common Stock"). The number of shares of Panthers Common Stock
issued in the Merger will be determined by dividing that portion of the Merger
Consideration payable in the form of shares of Panthers Common Stock by $23.50
(the "Panthers Shares"). The Panthers Shares issued pursuant to the Plan of
Merger will be registered under the Securities Act of 1933, as amended,
pursuant to the Registration Statement.
1.4 FILING OF ARTICLES OF MERGER. At the time of the Closing (the
"Effective Date" or "Effective Time"), the parties shall cause the Merger to be
consummated by filing duly executed Articles of Merger (with the completed
Plans of Merger attached thereto) with the Secretaries of State of the State of
Illinois and Florida in such form as Panthers determines to be required to
lawfully effect the purposes of this Agreement.
1.5 ISSUANCE OF PANTHERS SHARES; DELIVERY OF CERTIFICATES AND
ASSIGNMENTS; RESTRICTIONS ON DISPOSITION OF PANTHERS SHARES. At the Effective
Time, Panthers shall issue to Chensoff the Panthers Shares issuable pursuant to
Section 1.3, registered in Chensoff's name. Panthers shall deliver such shares
in the following manner: (i) Panthers shall set aside and hold in accordance
with Article VIII certificates evidencing Panthers Shares having an aggregate
value of $4,000,000, based upon the per share price of $23.50 (the "Held Back
Shares") and (ii) Panthers shall deliver to Chensoff one or more certificates
evidencing the balance of Panthers Shares. The Panthers Shares being issued in
connection with this merger transaction will be registered under the Securities
Act pursuant to the Registration Statement. Chensoff agrees that during the
times set forth below he will not, directly or indirectly, offer, sell,
contract to sell or otherwise dispose of the balance of Panthers Shares as
described below without the Panthers' prior consent:
100% of Panthers Shares during the 90 day period commencing on the
Effective Date;
75% of Panthers Shares during the 1 year period commencing on the
Effective Date;
50% of Panthers Shares during the 18 month period commencing on the
Effective Date; and
25% of Panthers Shares during the 24 month period commencing on the
Effective Date.
Chensoff further agrees that, during the 1-year period commencing on
the Effective Date, he shall not sell any of the Panthers Shares except
pursuant to an underwritten offering of such shares or pursuant to a placement
approved by the Panthers. Upon receipt of written notice that Chensoff desires
to sell a permissible amount of Panthers Shares, the Panther Companies shall
use their reasonable best efforts to accommodate such sale and, in this regard,
the Panther Companies shall attempt to locate an appropriate underwriter or
placement agent for such offering and shall pay the expenses of such
underwriting and the expenses of placement other than the fees of the placement
agent (which fees shall be commercially reasonable). Chensoff shall be free to
sell the permissible amount of Panthers Shares, without the requirement that
such sale be by underwritten offering or pursuant to an approved placement if
the Panther Companies are unable (x) to locate an appropriate underwriter or
placement agent, or (y) having found an appropriate underwriter or placement
agent, to file a registration statement or prepare an appropriate placement
memorandum for the Panthers Shares (that Chensoff desires to sell), within
sixty (60) days from the date of such notice, or (z) to
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cause the registration statement to become effective or the placement to be
consummated within ninety (90) days of the date of Chensoff's notice. In the
event that the Panther Companies are able to find an appropriate placement
agent and consummate the placement of the Panthers Shares, or an appropriate
underwriter and file a registration statement which shall become effective, as
applicable within ninety (90) days of the date of Chensoff's notice, then
Chensoff agrees that he shall not attempt to sell any of his Panthers Shares
more than one time during the 1-year period following the Effective Date.
1.6 TAX TREATMENT. The parties hereto acknowledge and agree that
the transactions contemplated hereby are intended to be a tax-free transaction
under Section 368 of the Internal Revenue Code of 1986, as amended (the
"Code").
1.7 ADDITIONAL PURCHASE PRICE. Panthers recognizes and agrees
that LeHill is pursuing the acquisition of title to three (3) additional Units
in the Resort, two (2) by foreclosure of non-performing Mortgages ("Foreclosure
Additional Units") and one (1) by purchase from a third party (the "Third Party
Additional Unit"), all three of which are identified on Schedule 1.7 hereto.
If LeHill shall obtain title to any of the Foreclosure Additional Units prior
to the Effective Date, the Base Amount set forth in Section 1.3 above shall not
be adjusted. However, if LeHill shall obtain title to the Third Party
Additional Unit, the Base Amount set forth in Section 1.3 shall be increased by
an amount mutually agreed upon by the parties. Other than for the contemplated
acquisition of the Foreclosure Additional Units, and the Third Party Additional
Units, Chensoff agrees, either directly or indirectly, not to pursue (and shall
be under no obligation to pursue) acquisition of any other Units at the Resort
prior to closing without having first obtained the agreement of Panthers, and
in such event the parties agree to use good faith negotiations to agree upon an
adjustment of the Base Amount attributable to any such further Unit
acquisitions agreed upon. It is further agreed that if it is determined that
LeHill does not hold record fee simple ownership of 322 Units, the parties
shall reduce the Base Amount by an amount that is mutually agreeable to the
parties for each Unit less than 322 held by LeHill, provided that LeHill shall
be required to hold record fee simple ownership of not less than 316 Units as
of Closing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE PANTHER COMPANIES
As a material inducement to each of Chensoff and ResortHill to enter
into this Agreement and to consummate the transactions contemplated hereby, the
Panther Companies make the following representations and warranties to such
parties:
2.1 CORPORATE STATUS. Each of the Panther Companies is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Florida (and, if reincorporated in any other state, shall
at all times be validly existing and in good standing in such other state in
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which the Panther Companies are reincorporated) and each Panther Company has
the requisite power and authority to carry on its business and to own or lease
its properties.
2.2 CORPORATE POWER AND AUTHORITY. Each of the Panther Companies
has the corporate power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. Each of the Panther Companies has taken all action
necessary to authorize its execution and delivery of this Agreement, the
performance of its respective obligations hereunder and the consummation of the
transactions contemplated hereby.
2.3 ENFORCEABILITY. This Agreement has been duly executed and
delivered by each of the Panther Companies and constitutes a legal, valid and
binding obligation of each of them, enforceable against each of the Panther
Companies in accordance with its terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and general equitable
principles regardless of whether such enforceability is considered in a
proceeding at law or in equity.
2.4 PANTHERS COMMON STOCK. Upon consummation of the transactions
contemplated hereunder and the issuance and delivery of certificates
representing the Panthers Shares to Chensoff, the Panthers Shares will be
validly issued, fully paid and non-assessable shares of Panthers Common Stock.
2.5 NO COMMISSIONS. None of the Panther Companies has incurred
any obligation for any finder's or broker's or agent's fees or commissions or
similar compensation in connection with the transactions contemplated hereby.
2.6 NO VIOLATION. The execution and delivery of this Agreement by
the Panther Companies and the performance by them of their respective
obligations hereunder and the consummation by them of the transactions
contemplated by this Agreement will not: (a) contravene any provision of the
articles of incorporation or bylaws of the Panther Companies; (b) violate or
conflict with any law, statute, ordinance, rule, regulation, decree, writ,
injunction, judgment or order of any Governmental Authority or of any
arbitration award which is either applicable to, binding upon or enforceable
against the Panther Companies; (c) conflict with, result in any breach of, or
constitute a default (or an event which would, with the passage of time or the
giving of notice or both, constitute a default) under, or give rise to a right
to terminate, amend, modify, abandon or accelerate, any Contract which is
applicable to, binding upon or enforceable against the Panther Companies; (d)
result in or require the creation or imposition of any Lien upon or with
respect to any of the property or assets of the Panther Companies; or (e)
require the consent, approval, authorization or permit of, or filing with or
notification to, any Governmental Authority, any court or tribunal or any other
Person, except any applicable filings required under the HSR Act, any SEC
filings required to be made by Panthers, any SEC and state filings contemplated
hereby.
2.7 SEC FILINGS/REGISTRATION STATEMENT. From November 8, 1996
through the date hereof, Panthers has duly and timely filed with the SEC all
reports, proxy statements and other
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information required to be filed by it under the Exchange Act (the "SEC
Filings"). The SEC Filings, at the time of filing did not contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. Except as disclosed in the SEC
Filings, from November 8, 1996 to the date hereof, there has not been any
Material Adverse Change in the business, financial position or results of
operations of Panthers. The Panthers Shares will be issued pursuant to that
prospectus dated June 17, 1997, which forms a part of that post-effective
Amendment No. 1 to the Registration Statement, as supplemented by Supplement
No. 1 dated June 30, 1997. No stop order has been issued suspending the
effectiveness of the Registration Statement.
2.8 CAPITALIZATION. As of the date hereof, the authorized capital
stock of Panthers consists of 100,000,000 shares of Panthers Common Stock
(which number includes 2,600,000 shares of Panthers Common Stock reserved for
issuance under the Panthers' 1996 Stock Option Plan) and 10,000,000 shares of
Class B common stock ("Class B Common Stock"), par value $.01 per share.
Panthers has no shares of preferred stock authorized. As of the date hereof,
Panthers has 23,700,507 shares of Panthers Common Stock issued and outstanding,
with warrants to purchase 869,810 shares of Panthers Common Stock at a price of
$29.01 per share and exchange rights which are convertible, without further
consideration, into 4,242,586 shares of Panthers Common Stock issued and
outstanding; and (b) 255,000 shares of Class B Common Stock issued and
outstanding. In addition, as of the date hereof, Panthers has granted stock
options to purchase 1,962,672 shares of Panthers Common Stock under Panthers'
Stock Option Plan.
2.9 CONTINUATION OF BUSINESS. FPH/RHI is a wholly-owned direct
subsidiary of Panthers. Following the Merger, ResortHill will be a
wholly-owned direct subsidiary of Panthers. Panthers has no present intention
to liquidate, or dissolve ResortHill, or discontinue its business.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF CHENSOFF AND RESORTHILL
As a material inducement to the Panther Companies to enter into this
Agreement and to consummate the transactions contemplated hereby, each of
Chensoff and ResortHill, jointly and severally, make the following
representations and warranties. LeHill, Pelican Hill and ResortHill are
collectively hereinafter referred to as the "LeHill Companies."
3.1 REPRESENTATION CONCERNING RECITALS; CORPORATE/PARTNERSHIP
STATUS.
(a) All of the Recitals set forth in the Recitals section
of this Agreement are true and correct.
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(b) ResortHill is a corporation, and each of Pelican Hill
and LeHill is a limited partnership duly organized or formed, validly existing
and in good standing under the laws of the state of its incorporation or
organization listed in the Recitals hereto and each has the requisite power and
authority to own or lease its properties and to carry on its business as now
being conducted. Each of the LeHill Companies is legally qualified to transact
business in Florida and in the jurisdiction of its organization and is in good
standing in each such jurisdiction. There is no pending or threatened
proceeding for the dissolution, liquidation, insolvency or rehabilitation of
any of the LeHill Companies. ResortHill is, and shall remain until the
Effective Date, an "S" corporation.
3.2 POWER AND AUTHORITY. Each of Chensoff and ResortHill, as
applicable, has the power and authority to execute and deliver this Agreement,
the ▇▇▇▇▇▇ Purchase Agreement, the Assignment and Assumption and the ▇▇▇▇▇▇▇
Assignment, to perform its respective obligations hereunder and thereunder and
to consummate the transactions contemplated hereby. Each of Chensoff and
ResortHill has taken all action necessary to authorize the execution and
delivery of this Agreement, the performance of its respective obligations
hereunder and the consummation of the transactions contemplated hereby.
3.3 ENFORCEABILITY.
(a) This Agreement, the ▇▇▇▇▇▇ Purchase Agreement, the
Assignment and Assumption and the ▇▇▇▇▇▇▇ Assignment, have been duly executed
and delivered by Chensoff and this Agreement has been duly executed and
delivered by ResortHill and each of these constitute the legal, valid and
binding obligation of Chensoff and ResortHill, respectively, enforceable
against them in accordance with their respective terms, except as the same may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and
general equitable principles regardless of whether such enforceability is
considered in a proceeding at law or in equity.
(b) The ▇▇▇▇▇▇ Purchase Agreement, which by its terms has
expired, has substantively been reinitiated by execution and delivery of the
Assignment and Assumption and is hereby fully enforceable against Chensoff, as
the date hereof.
3.4 CAPITALIZATION; OWNERSHIP. Chensoff is the record and
beneficial owner of all the outstanding shares of capital stock of ResortHill
free and clear of any Liens. All of the record owners of the partnership
interests in Pelican Hill and LeHill are set forth in the Recitals hereto.
Further, ResortHill owns its partnership interest in LeHill and Pelican Hill,
free and clear of all Liens. To the Best of Chensoff's Knowledge, the
interests of ▇▇-▇▇, NPI and LW-RTC in Pelican Hill and/or LeHill are free of
all Liens. Provided that ▇▇-▇▇, NPI and LW-RTC own the partnership interests
in LeHill and Pelican Hill as set forth in the Recitals hereto, then upon
concluding the Merger, the acquisitions contemplated by the ▇▇▇▇▇▇ Purchase
Agreement and receipt of the assignment of the ▇▇▇▇▇▇▇ Interest, the Panther
Companies shall own all of the capital stock of ResortHill and all of the
partnership interests of LeHill and Pelican Hill.
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3.5 NO VIOLATION. Except for the restrictions upon transfer of
partnership interests contained in the respective partnership agreements of
LeHill and Pelican Hill, the execution and delivery of this Agreement by
Chensoff and ResortHill, the performance by them of their respective
obligations hereunder and the consummation by them of the transactions
contemplated by this Agreement, the ▇▇▇▇▇▇ Purchase Agreement, the Assignment
and Assumption and the ▇▇▇▇▇▇▇ Assignment, will not (i) contravene any
provision of ResortHill's articles of incorporation or bylaws, or the
partnership agreement of Pelican Hill or LeHill, (ii) violate or conflict with
any law, statute, ordinance, rule, regulation, decree, writ, injunction,
judgment or order of any Governmental Authority or of any arbitration award
which is either applicable to, binding upon or enforceable against Chensoff or
ResortHill, (iii) conflict with, result in any breach of, or constitute a
default (or an event which would, with the passage of time or the giving of
notice or both, constitute a default) under, or give rise to a right to
terminate, amend, modify, abandon or accelerate, any Contract which is
applicable to, binding upon or enforceable against any of Chensoff and
ResortHill, (iv) result in or require the creation or imposition of any lien
upon or with respect to any of the property, assets or the issued and
outstanding equity interests of Chensoff or ResortHill, or (v) require the
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Authority, any court or tribunal or any other Person,
except any applicable filings required under the HSR Act, and any SEC and other
filings required to be made by the Panther Companies.
3.6 RECORDS OF THE LEHILL COMPANIES. The copies of the respective
articles of incorporation, bylaws, certificate of limited partnership,
partnership agreement and other organizational documents, as appropriate, of
the LeHill Companies which were provided to the Panther Companies or will be
provided prior to Closing, are true, accurate and complete and reflect all
amendments made through the date of this Agreement or the date of delivery to
Panthers, if later. The minute books and partnership records for the LeHill
Companies made available to the Panther Companies for review were correct and
complete in all material respects as of the date of such review, no further
entries have been made through the date of this Agreement. All material
actions taken by each of the LeHill Companies have been duly authorized or
ratified. All accounts, books, ledgers and official and other records of each
of the LeHill Companies have been fully, properly and accurately kept and
completed in all material respects, and there are no material inaccuracies or
discrepancies of any kind contained therein.
3.7 SUBSIDIARIES. Except as set forth elsewhere in this
Agreement, ResortHill, LeHill and Pelican Hill do not own, directly or
indirectly, any outstanding voting securities of or other interests in, or
control, any other corporation, partnership, joint venture or other business
entity.
3.8 RESORT FINANCIAL STATEMENTS. The Panther Companies have been
delivered the financial statements for the Resort, including the notes thereto,
for the year ended December 31, 1996, audited by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, which has
issued its report thereon (the "Resort Financial Statements"). To the Best of
Chensoff's Knowledge, the Resort Financial Statements fairly and accurately
present the financial condition of the Resort and the results of its operations
as of the date thereof and for the period covered thereby.
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3.9 LEHILL FINANCIAL STATEMENTS.
(a) Prior to the Closing, Chensoff and ResortHill will
deliver to the Panther Companies the financial statements for LeHill, including
the notes thereto, for the year ended December 31, 1996, audited by ▇▇▇▇▇▇▇▇▇▇
Melvoin & ▇▇▇▇▇▇▇, which will issue its report thereon (the "Audited LeHill
Financial Statements"). The Audited LeHill Financial Statements will fairly
and accurately present the financial condition of LeHill and the results of its
operations as of the date thereof and the period covered thereby and will be
prepared in accordance with generally accepted accounting principles
consistently applied, and will reflect all adjustments necessary for a fair
presentation of the financial information contained therein.
(b) At the Closing, Chensoff and ResortHill will deliver
to the Panther Companies an unaudited balance sheet of LeHill as of the
Effective Date (the "Closing Balance Sheet"), which balance sheet will reflect
net assets equal to the sum of (a) $1,000,000 of LeHill's share of the
approximately $1,600,000 quarterly distribution by the Association to be paid
on or about July 15, 1997 to the extent such distribution is actually paid plus
(b) $1.00 plus (c) the principal amounts of any Mortgage that have been
satisfied or paid between the execution of this Agreement and Closing. The
Closing Balance Sheet will fairly present the financial condition of LeHill as
of the Effective Date and will be prepared on a basis consistent with the
balance sheet included in the Audited LeHill Financial Statements.
(c) At the Closing, Chensoff and ResortHill will deliver
to the Panther Companies an unaudited balance sheet of ResortHill as of the
Effective Date which balance sheet will reflect net assets equal to $1.00 (in
addition to its interest in Pelican Hill and LeHill).
3.10 LIABILITIES OF THE RESORT AND THE LEHILL COMPANIES. The
LeHill Companies will not have any liabilities or obligations not reflected in
the balance sheet included in the Audited LeHill Financial Statements except
(a) liabilities incurred by LeHill in the ordinary course of business since
such date and (b) normal accruals, reclassifications and audit adjustments in
respect of LeHill which would be reflected on an audited financial statement
and which would not be material in the aggregate; and the LeHill Companies will
not have any liabilities or obligations not reflected on the Closing Balance
Sheet except for property taxes not due and payable with respect to the Units
as of Closing, liability for which Panthers shall assume. The parties agree
that following Closing the Panthers may receive revenues and receive claims for
expenses of LeHill that relate to a period prior to Closing or that relate to
an obligation owed to LeHill (the revenues derived from the sources identified
on Schedule 3.10 attached hereto) or an obligation owed by LeHill (e.g.
attorneys' fees, title insurance and closing expenses) in connection with
LeHill's acquisition of a Unit prior to Closing or in connection with any of
LeHill's activities including this transaction. The parties agree that
Chensoff shall be entitled to such prior revenues and shall be responsible for
such prior expenses and liabilities. Since December 31, 1996, LeHill has not
(i) incurred any obligations or liabilities (including any indebtedness)or
entered into any transaction or series of transactions involving in excess of
$100,000 in the aggregate out of the ordinary course of business, except for
this Agreement, the ▇▇▇▇▇▇ Purchase Agreement, the Assignment and Assumption
and the ▇▇▇▇▇▇▇
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Assignment, and the transactions contemplated hereby and thereby; (ii) suffered
any theft, damage, destruction or casualty loss, not covered by insurance and
for which a timely claim was filed, in excess of $100,000 in the aggregate;
(iii) waived, canceled, compromised or released any rights having a value in
excess of $100,000 in the aggregate out of the ordinary course of business;
(iv) imposed any security interest or other Lien on any of its Units, Mortgages
or other assets other than in the ordinary course of business consistent with
past practice; or (v) entered into any other transaction or been subject to any
event which has or may have a Material Adverse Effect on LeHill. To the Best
of Chensoff's Knowledge, the Resort does not have any liabilities or
obligations not reflected in the balance sheet included in the Resort Financial
Statements except (a) liabilities incurred by the Resort in the ordinary course
of business since such date, (b) normal accruals, reclassifications and audit
adjustments which would be reflected on an audited financial statement and
which would not be material in the aggregate.
3.11 LITIGATION. Except for (i) any foreclosure suits in
connection with non-performing Mortgages, (ii) that certain class action
lawsuit by Unit-Owners of the Resort against, among others, Shelter Seagate
Corporation ("Shelter Seagate Class Action"), and (iii) the interpleader action
filed in connection with the Shelter Seagate Class Action, to the Best of
Chensoff's Knowledge, there is no action, suit, or other legal or
administrative proceeding or governmental investigation pending, threatened,
anticipated or contemplated against, by or affecting any of the LeHill
Companies or, to the Best of Chensoff's Knowledge, the Resort, or any of their
properties or assets (other than, with respect to the Resort only, any actions
of a type commonly instituted against hotel/resort type properties in the
ordinary course of business which, on the whole, shall not result in a Material
Adverse Effect on the operations of the Resort) or which questions the validity
or enforceability of this Agreement or the transactions contemplated hereby,
and there is no basis for any of the foregoing. There are no outstanding
orders, decrees or stipulations issued by any Governmental Authority in any
proceeding to which any of the LeHill Companies or, to the Best of Chensoff's
Knowledge, the Resort is or was a party which have not been complied with in
full or which continue to impose any material obligations on any of the LeHill
Companies or, to the Best of Chensoff's Knowledge, the Resort.
3.12 REAL ESTATE
(a) LeHill is the record fee simple title holder of 322
Units the legal description of which is set forth on Schedule 3.12(a). LeHill
is also the record holder of the Mortgages, Notes and Mortgage Loans
encumbering certain condominium units at the Resort. The current outstanding
principal balance, status and condominium unit encumbered by each Mortgage is
set forth on Schedule 3.12(a). LeHill owns the Mortgages free and clear of any
Liens. Other than the Units and Mortgages, neither LeHill, Pelican Hill nor
ResortHill owns any other real property or any interest therein (the Units and
Mortgages owned by LeHill are collectively hereinafter referred to as the
"LeHill-Owned Properties"). Schedule 3.12(a) sets forth (i) the legal
description of each Unit and the Declaration of Condominium; and (ii) legal
descriptions of each condominium unit subject to a Mortgage, together with a
list of all title insurance policies relating to such LeHill-Owned Properties,
all of which policies have previously been delivered or will, by Closing, be
delivered to
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the Panther Companies by Chensoff and ResortHill, provided, however, that this
representation and warranty shall not be deemed breached in any way so long as
LeHill holds title to at least 316 Units free of any Liens and subject only to
the matters disclosed on LeHill's existing title policies and Panthers has
received, at Closing, an appropriate reduction of the Base Amount with respect
to the reduction in the number of Units owned by LeHill, as provided under
Section 1.7 hereof. Further, in the event that, prior to Closing, any Mortgage
is repaid, such event shall not result in a breach of this representation, but
LeHill shall retain the principal amount of the Mortgage repaid on the Closing
Balance Sheet.
(b) With respect to each such parcel of LeHill-Owned
Property:
(i) LeHill shall use its best efforts to have,
as of Closing, marketable title to each parcel of LeHill-Owned
Properties free and clear of any Lien other than (x) liens for real
estate taxes not yet due and payable; and (y) encumbrances, easements,
covenants and restrictions and other matters described in the
permitted exceptions listed on Schedule 3.12(b) and (z) any other
exceptions to title Panthers may agree to accept (the "Permitted
Exceptions"). Title to any Unit shall be deemed marketable and this
covenant shall not be deemed breached in any way so long as title to
the Units is subject only to the Permitted Exceptions. LeHill's best
efforts shall include, if necessary, the expenditure of an amount not
to exceed $200,000 to obtain documentation necessary to clear title
exceptions (other than the matters described in clauses (x), (y) and
(z) above) which render title unmarketable. In consideration for
LeHill's exerting its best efforts in connection with this Section,
Panthers agree that it shall obtain a title insurance commitment with
respect to the Units and request that a title insurance policy based
upon this commitment be issued by a title insurance company of
Panthers' choice and at Panthers' expense, such policy to be effective
as of the Closing Date.
(ii) Neither Chensoff nor ResortHill has received
notice of any condemnation proceedings, suits or administrative actions
relating to the LeHill-Owned Properties and to the Best of Chensoff's
Knowledge, none are threatened;
(iii) None of the LeHill-Owned Properties have been
mortgaged by LeHill;
(iv) To the Best of Chensoff's Knowledge, no
notice has been received from any Governmental Authorities alleging
that the Resort facilities lack any approval (including licenses or
permits) of any Governmental Authority required in connection with the
operation thereof, or that such facilities have not been operated and
maintained in substantial accordance with applicable laws, regulations,
ordinances or rules;
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(v) Except for the Agency Agreement and other
agreements executed by Agent in connection with his duties and
responsibilities thereunder, and except for agreements (which require
advance reservations to be made through LeHill and are made subject to
availability) with certain former owners of the Units and certain
personnel associated with certain LeHill Companies relating to their
use, in the aggregate, of not more than 200 room nights during the
remainder of 1997 and not more than 300 nights in 1998, LeHill has not
executed any Contracts granting to any party or parties the right of
use or occupancy of any portion of the parcels of LeHill-Owned
Property;
(vi) Except for the provisions contained in the
Declaration of Condominium, there are no outstanding options or rights
of first refusal to purchase the parcels of LeHill-Owned Property, or
any portion thereof or interest therein;
(vii) To the Best of Chensoff's Knowledge, there
are no material defects affecting the improvements or buildings
constituting the Resort which would render them inadequate for the use
in connection with the operation of the Resort in the manner currently
operated, or, if the former is not the case, provision has been made
to remedy such material defects or to reserve for such remedy in the
Association budget;
(viii) Except for the Agency Agreement and any other
agreements executed by Agent in connection with its duties and
responsibilities thereunder and a Loan Servicing Agreement between
LeHill and Wendover Funding, Inc., LeHill has not executed any service
contracts, management agreements or similar agreements which affect
the LeHill-Owned Property; and
(ix) Except for the special assessments related
to Pelican Bay and its environs which are included as line items on
the real estate tax bills for the Units, neither Chensoff, nor any
LeHill Company has received notice of any special assessment which may
affect any parcel of the LeHill-Owned Property, and to the Best of
Chensoff's Knowledge, no such special assessment is contemplated by
any Governmental Authority.
(c) The Resort is not a lessee, licensee or tenant under,
nor (except for the Agency Agreement and the agreements with the former
unit owners referenced at clause (v) above) are any of the LeHill Companies a
party to any leases, licenses or similar agreements for the use of any real
property.
(d) In its acquisition of Units, LeHill has complied in
all material respects with all applicable requirements of the Association
Governing Documents, Declaration of Condominium and the requirements of
appropriate Governmental Authorities necessary for the proper recording of the
deeds for the Units and has paid all relevant transfer fees to the Association
and all sales or
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use taxes, non-recurring intangibles tax, documentary stamp tax or other excise
tax payable in connection with the acquisition of the Units and Mortgages, the
recording of deeds for the Units and the recording of Mortgages.
3.13 GOOD TITLE TO AND CONDITION OF ASSETS
(a) To the Best of Chensoff's Knowledge, the Fixed Assets
(as hereinafter defined) currently in use in connection with the business and
operations of the Resort are sufficient for the business operations of the
Resort and none of the LeHill Companies shall take any action to cause the
removal, without adequate replacement, of any of the Fixed Assets. For
purposes of this Agreement, "Fixed Assets" means all vehicles, machinery,
equipment, tools, supplies, leasehold improvements, furniture and fixtures used
by or located on the premises of the Resort.
(b) Since October 1, 1995, pursuant to the Management
Contract the Association has reserved four percent (4%) of the Resort's annual
gross revenues on a monthly basis for repair and replacement of Fixed Assets of
the Resort, and, to the Best of Chensoff's Knowledge, the unused balance of the
Resort's replacement reserve on May 31, 1997 was $848,248, as stated in the
Resort's financial statements as of such date.
3.14 COMPLIANCE WITH LAWS.
(a) Each of the LeHill Companies and, to the Best of
Chensoff's Knowledge, the Resort is and has been in compliance with all
material laws, regulations and orders applicable to it, its business and
operations (as conducted by it now and in the past), and the LeHill-Owned
Properties. Neither Chensoff, ResortHill, any of the LeHill Companies nor, to
the Best of Chensoff's Knowledge, the Resort has been cited, fined or otherwise
notified by any Governmental Authority of any asserted past or present failure
to comply with any laws, regulations or orders which has not been corrected or
which failure would cause Material Adverse Affect upon the results of
operations of the Resort and, to the Best of Chensoff's Knowledge, no
proceeding with respect to any such violation is pending or threatened.
(b) Neither Chensoff, any of the LeHill Companies nor, to
the Best of Chensoff's Knowledge, the Resort or any of their employees or
agents, has made any payment of funds in connection with the business of the
Resort or the LeHill Companies which is prohibited by law, and no funds have
been set aside to be used in connection with the business of the Resort or the
LeHill Companies for any payment prohibited by law.
3.15 LABOR AND EMPLOYMENT MATTERS. None of the LeHill Companies
has any employees.
3.16 EMPLOYEE BENEFIT PLANS. None of the LeHill Companies has any
employees and does not have any employee benefit plans.
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3.17 TAX MATTERS. Except with respect to the 1996 tax returns of
the LeHill Companies, all Tax Returns required to be filed prior to the date
hereof with respect to the LeHill Companies or any of their income, properties,
franchises or operations have been timely filed, each such Tax Return has been
prepared in compliance with all applicable laws and regulations, and all such
Tax Returns are true and accurate in all respects. All Taxes due and payable
by or with respect to each of the LeHill Companies have been paid and are
accrued on the Current Balance Sheets or will be accrued on the LeHill
Companies' respective books and records as of the Closing. Further, (i) all
taxable periods of each of the LeHill Companies are open; (ii) no deficiency or
proposed adjustment which has not been settled or otherwise resolved for any
amount of Taxes has been asserted or assessed by any taxing authority against
any of the LeHill Companies; (iii) none of the LeHill Companies has consented
to extend the time in which any Taxes may be assessed or collected by any
taxing authority; (iv) except for its 1996 tax returns, none of the LeHill
Companies has requested or been granted an extension of the time for filing any
Tax Return to a date later than the Effective Time; (v) there is no action,
suit, taxing authority proceeding, or audit or claim for refund now in
progress, pending or threatened against or with respect to any of the LeHill
Companies regarding Taxes; (vi) none of the LeHill Companies has made an
election or filed a consent under Section 341(f) of the Code (or any
corresponding provision of state, local or foreign law) on or prior to the
Effective Time; (vii) there are no Liens for Taxes (other than for current
Taxes not yet due and payable) upon the assets of any of the LeHill Companies;
(viii) none of the LeHill Companies will be required (A) as a result of a
change in method of accounting for a taxable period ending on or prior to the
Effective Date, to include any adjustment under Section 481(c) of the Code (or
any corresponding provision of state, local or foreign law) in taxable income
for any taxable period (or portion thereof) beginning after the Effective Time
or (B) as a result of any "closing agreement,"as described in Section 7121 of
the Code (or any corresponding provision of state, local or foreign law), to
include any item of income or exclude any item of deduction from any taxable
period (or portion thereof) beginning after the Effective Time; (ix) none of
the LeHill Companies has been a member of an affiliated group (as defined in
Section 1504 of the Code) or filed or been included in a combined, consolidated
or unitary income Tax Return; (x) except as provided in their respective
partnership agreements, none of the LeHill Companies is a party to or bound by
any tax allocation or tax sharing agreement or has any current or potential
contractual obligation to indemnify any other Person with respect to Taxes;
(xi) no taxing authority will claim or assess any additional Taxes against any
of the LeHill Companies for any period for which Tax Returns have been filed;
(xii) none of the LeHill Companies has made any payments, and will not become
obligated (under any contract entered into on or before the Effective Date) to
make any payments, that will be non-deductible under Section 280G of the Code
(or any corresponding provision of state, local or foreign law); (xiii) no
claim has ever been made by a taxing authority in a jurisdiction where any of
the LeHill Companies does not file Tax Returns that such LeHill Company is or
may be subject to Taxes assessed by such jurisdiction; and (xiv) none of the
LeHill Companies has any permanent establishment in any foreign country, as
defined in the relevant tax treaty between the United States of America and
such foreign country; (xv) true, correct and complete copies of all income and
sales Tax Returns filed by or with respect to each of the LeHill Companies for
the past two years (it being acknowledged these are the only years for which
filings have been required), will have furnished or made available to the
Panther Companies, and (xvi) none of the LeHill Companies will be subject
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to any Taxes for the period ending at the Effective Time for any period for
which a Tax Return has not been filed imposed pursuant to Section 1374 or
Section 1375 of the Code (or any corresponding provision of state, local or
foreign law); other than closing the Section 361 transaction pursuant to this
Agreement.
In the event any taxing authority examines any return or the LeHill
Companies for any period prior to the Effective Time, or otherwise proposes an
adjustment or deficiency for any such period, and it appears that Panthers will
not bear any liability with respect to such audit, adjustment or deficiency,
Chensoff shall be permitted, at his election, to defend against such audit,
adjustment or deficiency or direct the manner in which such defense is carried
out, including without limitation decisions concerning acceptance or rejection
of settlement offers and filing of appeals and protests. If Chensoff makes
such election, Panthers shall use its best efforts to cooperate in such defense
and Chensoff shall bear the costs thereof.
3.18 INSURANCE. The Association maintains the insurance described
on the Certificate of Insurance attached hereto as Schedule 3.18, and LeHill is
insured thereunder by virtue of being a Unit owner. There are currently no
claims being made on such insurance with respect to any of the LeHill-Owned
Property.
3.19 DISTRIBUTIONS TO MEMBERS OF THE ASSOCIATION. Since the date
of the Association's disbursement for the first quarter of 1997 (which was made
on or about April 15, 1997), except for disbursements by the Association
related to the first quarter of 1997 (and except for disbursement of amounts
from prior quarters that had been previously withheld from disbursement to
certain non-LeHill unit owners), no more than $533,333 has been or will be
distributed to non-LeHill unit owners by the Association prior to the Closing
Date. LeHill warrants and agrees that it shall not distribute to its partners
more than the amount by which LeHill's share of the approximate $1,600,000
distribution to be made by the Association to the Unit Owners on or about July
15, 1997 exceeds $1,000,000. Notwithstanding the foregoing, the Interpleader
account holds approximately $3,600,000 of which $663,000 is to be distributed
in accordance with the settlement agreement, currently pending court approval,
to certain unit owners including LeHill. LeHill is obligated to distribute a
portion of those funds it receives to approximately 82 Persons from whom LeHill
had acquired certain of the Units (the "▇▇▇▇▇ and ▇▇▇▇▇ Clients"). If this
settlement agreement disbursement is made prior to Closing such disbursement
may be distributed by LeHill to its partners and to the ▇▇▇▇▇ and Simon Clients
and, if it is made after Closing, the Panther Companies acknowledge that it
shall distribute such disbursement to the ▇▇▇▇▇ Clients and to ▇▇▇▇▇▇▇▇, ▇▇-LP,
NPI and LW-RTC. The remainder of the Interpleader account, being
approximately $2,940,000 may be distributed to the Association prior to Closing,
but shall not be distributed to unit owners prior to Closing. Panthers
acknowledges that LeHill has agreed to pay certain former unit owners an amount
which in the aggregate, will not exceed $30,000, upon release of the
interpleader account funds to the Association, and that such obligation shall
not be assumed by Panthers but shall be paid by Chensoff. Other than the
foregoing and other than amounts derived from sources listed on Schedule 3.10,
LeHill shall not distribute any other amounts received by it from the
Association to its partners.
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3.20 LICENSES AND PERMITS. LeHill does not possess any licenses,
governmental approvals, permits or authorizations (collectively, the "Permits")
in respect of its ownership of the Units and Mortgages and LeHill is not
required to maintain any such Permits.
3.21 ENVIRONMENTAL MATTERS.
(a) To the Best of Chensoff's Knowledge, except as
disclosed in the Environmental Report, (i) the Resort has not conducted and
shall not hereafter conduct and (ii) no prior owner or current or prior tenant
or occupant of all or any portion of the Resort has conducted or is conducting,
any Hazardous Substance Activity at, on or under the property at the Resort (A)
in violation of Environmental Laws that would have a Material Adverse Effect on
the operation of the Resort or (B) in a manner inconsistent with the use of the
Resort as a first class resort hotel complex; and
(b) To the Best of Chensoff's Knowledge, except as
disclosed by the Environmental Report, the Resort does not contain asbestos or
any Asbestos-Containing Material and there is no current or potential
contamination of the Resort by asbestos fiber.
3.22 INTELLECTUAL PROPERTY. To the Best of Chensoff's Knowledge,
the Resort has the right to use the "Registry" name in connection with the
operation of its hotel business pursuant to the Management Agreement. None of
the LeHill Companies owns or has interest in and to any trademarks, service
marks, trade names, copyrights, know-how, patents, trade secrets, licenses
(including licenses for the use of computer software programs), and other
intellectual property used in the conduct of its respective business (the
"Intellectual Property"). The conduct of the business of each of the LeHill
Companies and, to the Best of Chensoff's Knowledge, the Resort, as presently
conducted does not infringe or misappropriate any intellectual property rights
held or asserted by any Person.
3.23 ACCURACY OF INFORMATION FURNISHED BY CHENSOFF AND RESORTHILL.
No representation, statement or information made or furnished by Chensoff or
ResortHill to the Panther Companies or any of the Panther Companies'
representatives, including those contained in this Agreement and the various
Schedules attached hereto and the other information and statements referred to
herein and previously furnished by Chensoff and ResortHill contains or shall
contain any untrue statement of a material fact or omits or shall omit any
material fact necessary to make the information contained therein not
misleading. Chensoff and ResortHill have provided or will provide by Closing
the Panther Companies with true, accurate and complete copies of all documents
listed or described in the various Schedules attached hereto.
3.24 BANK ACCOUNTS. Schedule 3.24 sets forth all accounts of each
of the LeHill Companies with any bank, broker or other depository institution,
and the names of all persons authorized to withdraw funds from each such
account. The LeHill-Owned Properties identified on Schedule 3.12(a), and
equipment, inventory, chattel paper and books and records of the Resort and
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each of the LeHill Companies is located as of the date hereof at the Resort or
the address listed in Section 12.1 below.
3.25 NO COMMISSIONS. Neither Chensoff, Resort Hill, Pelican Hill
nor LeHill has incurred any obligation for any finder's or broker's or agent's
fees or commissions or similar compensation in connection with the transactions
contemplated hereby.
ARTICLE IV
CONDUCT OF BUSINESS PENDING THE EFFECTIVE TIME
4.1 CONDUCT OF BUSINESS OF THE LEHILL COMPANIES PENDING THE
EFFECTIVE TIME. Chensoff and ResortHill covenant and agree that, between the
date of this Agreement and the Effective Time, the business of the LeHill
Companies shall be conducted only in and it shall not take any action except
in, the ordinary course of business, consistent with past practice. Chensoff
and ResortHill shall use their respective best efforts to preserve intact the
business organization of each of the LeHill Companies, and to preserve its
present relationships with customers, suppliers and other persons with which it
has significant business relations. By way of amplification and not
limitation, except as contemplated by this Agreement, none of the LeHill
Companies shall, between the date of this Agreement and the Effective Time,
directly or indirectly, do or propose or agree to do any of the following
without the prior written consent of the Panther Companies:
(a) amend or otherwise change its articles of
incorporation, bylaws, declaration of condominium, certificate of
limited partnership, partnership agreement or equivalent
organizational documents;
(b) issue, sell, pledge, dispose of, encumber, or,
authorize the issuance, sale, pledge, disposition, grant or
encumbrance of (i) any shares of its capital stock or partnership
interests of any class, or any options, warrants, convertible
securities or other rights of any kind to acquire any shares of such
capital stock or partnership interest, or (ii) any of its assets,
tangible or intangible, except in the ordinary course of business
consistent with past practice;
(c) declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock, property or otherwise, with
respect to any of its capital stock or partnership interests which
would result in a breach of the representations set forth in Sections
3.9(b) or 3.9(c).
(d) reclassify, combine, split, subdivide or redeem,
purchase or otherwise acquire, directly or indirectly, any of its
capital stock or partnership interests;
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(e) (i) except for the possible acquisition of the ▇▇▇▇▇▇▇
Interest, acquire (including, without limitation, for cash or shares
of stock or partnership interests, by merger, consolidation, or
acquisition of stock, partnership interest or assets) any interest in
any corporation, partnership or other business organization or
division thereof or any assets, or make any investment either by
purchase of stock, partnership interest or other securities,
contributions of capital or property transfer, or, except in the
ordinary course of business, consistent with past practice, purchase
any property or assets of any other Person, (ii) incur any
indebtedness for borrowed money (other than in the ordinary course of
business) or issue any debt securities or assume, guarantee or endorse
or otherwise as an accommodation become responsible for, the
obligations of any Person, or make any loans or advances, or (iii)
enter into any Contract other than in the ordinary course of business,
consistent with past practice;
(f) hire any employee(s);
(g) take any action other than in the ordinary course of
business and in a manner consistent with past practice with respect to
accounting policies or procedures;
(h) pay, discharge or satisfy any existing claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise), other than the payment, discharge or
satisfaction in the ordinary course of business and consistent with
past practice of due and payable liabilities reflected or reserved
against in its financial statements, as appropriate, or liabilities
incurred after the date hereof in the ordinary course of business and
consistent with past practice or incurred in connection with this
transaction and except for completing any currently pending
foreclosures of Mortgages, the acceptance of a deed in lieu in
discharge of any debt owed to LeHill or the acquisition of the
condominium unit currently under contract; or
(i) agree, in writing or otherwise, to take or authorize
any of the foregoing actions or any action which would make any
representation or warranty in Article III untrue or incorrect.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 FURTHER ASSURANCES. Each party shall execute and deliver such
additional instruments and other documents and shall take such further actions
as may be necessary or appropriate to effectuate, carry out and comply with all
of the terms of this Agreement and the transactions contemplated hereby.
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5.2 COMPLIANCE WITH COVENANTS. Chensoff and ResortHill shall
comply and shall cause Pelican Hill and LeHill to comply with all of their
respective covenants under this Agreement.
5.3 COOPERATION. Each of the parties agrees to cooperate with the
other parties in the preparation and filing of all forms, notifications,
reports and information, if any, required or reasonably deemed advisable
pursuant to any law, rule or regulation or the rules of any exchange on which
the Panthers Common Stock is listed or the Nasdaq Stock Market, if applicable,
in connection with the transactions contemplated by this Agreement and to use
its respective best efforts to agree jointly on a method to overcome any
objections by any Governmental Authority to any such transactions.
5.4 HSR ACT AND OTHER ACTIONS. Each of the parties hereto shall
(i) make promptly (and in no event later than July 11, 1997 following the date
hereof) its respective filings, if any, and thereafter make any other required
submissions, under the HSR Act, with respect to the transactions contemplated
hereby, and (ii) use its reasonable best efforts to take, or cause to be taken,
all appropriate actions, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the transactions contemplated herein, including, without
limitation, using its best efforts to obtain all licenses, permits, consents,
approvals, authorizations, qualifications and orders of any Governmental
Authority and parties to Contracts with any of the LeHill Companies as are
necessary for the consummation of the transactions contemplated hereby. Each
of the parties shall make on a prompt and timely basis all governmental or
regulatory notifications and filings required to be made by it for the
consummation of the transactions contemplated hereby. The parties also agree
to use best efforts to defend all lawsuits or other legal proceedings
challenging this Agreement or the consummation of the transactions contemplated
hereby and to lift or rescind any injunction or restraining order or other
order adversely affecting the ability of the parties to consummate the
transactions contemplated hereby.
5.5 ACCESS TO INFORMATION. From the date hereof to the Effective
Time, Chensoff and each of the LeHill Companies shall use their good faith best
efforts to (and shall cause its directors, officers, employees, auditors,
counsel and agents) afford the Panther Companies and their respective officers,
employees, auditors, counsel and agents reasonable access at all reasonable
times to the Resort, its properties, offices, and other facilities, to its
officers and employees and to all books and records, and shall furnish such
persons with all financial, operating and other data and information as may be
requested. No information provided to or obtained by the Panther Companies
shall affect any representation or warranty in this Agreement. The Panthers
shall contact and coordinate its activities with Chensoff prior to contacting,
viewing or inspecting the Resort, its properties, offices and other facilities.
5.6 NOTIFICATION OF CERTAIN MATTERS. Chensoff and the LeHill
Companies shall give prompt notice to the Panther Companies of the occurrence
or non-occurrence of any event which would likely cause any representation or
warranty contained herein to be untrue or inaccurate, or any covenant,
condition, or agreement contained herein not to be complied with or satisfied.
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5.7 TAX TREATMENT. The parties will use their respective best
efforts to cause the merger transactions contemplated hereunder to qualify as a
tax-free transaction under the provisions of Section 361 of the Code and do not
presently intend to take any action after the transactions contemplated
hereunder are effected to cause the transactions contemplated hereunder to lose
their tax-free status. All parties hereto agree to comply with the reporting
requirements of Section 361 of the Code and applicable Treasury Regulations
promulgated thereunder.
5.8 CONFIDENTIALITY; PUBLICITY. Except as may be required by law
or as otherwise permitted or expressly contemplated herein, no party hereto or
their respective Affiliates, employees, agents and representatives shall
disclose to any third party this Agreement or the subject matter or terms
hereof without the prior consent of the other parties hereto. No press release
or other public announcement related to this Agreement or the transactions
contemplated hereby shall be issued by any party hereto without the prior
approval of the other parties, except that the Panther Companies may make such
public disclosure which it believes in good faith to be required by law or by
the terms of any listing agreement with or requirements of a securities
exchange or the Nasdaq National Market (in which case the Panther Companies
will consult with Chensoff and ResortHill prior to making such disclosure).
5.9 NO OTHER DISCUSSIONS. Neither Chensoff nor any of the LeHill
Companies or their respective Affiliates, employees, agents and representatives
will (i) initiate, encourage the initiation by others of discussions or
negotiations with third parties, or respond to solicitations by third persons
in an affirmative manner (e.g. supply financials, documents or other material
information) relating to any merger, sale or other disposition of any
substantial part of the assets, business or properties of any of the LeHill
Companies (whether by merger, consolidation, sale of stock or otherwise) or
(ii) enter into any agreement or commitment (whether or not binding) with
respect to any of the foregoing transactions. Chensoff and the LeHill
Companies will promptly notify the Panther Companies if any third party, which
Chensoff has a good faith reason to believe has a genuine interest in the Units
or the Resort, attempts to initiate any solicitation, discussion or negotiation
with respect to any of the foregoing transactions.
5.10 DUE DILIGENCE REVIEW AND ENVIRONMENTAL ASSESSMENT. The
Panther Companies shall be entitled to have conducted, at the Panther
Companies' expense, prior to the Closing a due diligence review of the assets,
properties, books and records of the Resort and each of the LeHill Companies
and an environmental assessment of the Resort and LeHill-Owned Properties
(hereinafter referred to as "Environmental Assessment"). The Environmental
Assessment may include, but not be limited to, a physical examination of the
Resort and LeHill-Owned Properties, and any structures, facilities, or
equipment located thereon, soil samples, ground and surface water samples,
storage tank testing, review of pertinent records, documents, and Licenses of
the Resort and each of the LeHill Companies. Chensoff and the LeHill Companies
shall use their respective best efforts to provide the Panther Companies or
their designated agents or consultants with the access to such property which
the Panther Companies, their agents or consultants require to conduct the
Environmental Assessment. If the Environmental Assessment identifies
environmental contamination which requires remediation or further evaluation
under the Environmental, Health and Safety Laws or if
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the results of the Environmental Assessment are otherwise not satisfactory to
the Panther Companies in their sole discretion, then the Panther Companies may
elect not to close the transactions contemplated by this Agreement in which
case this Agreement shall be terminated. The Panther Companies' failure or
decision not to conduct any such Environmental Assessment shall not affect any
representation or warranty of Chensoff and ResortHill under this Agreement.
Panthers shall contact and coordinate its activities with Chensoff prior to
conducting its due diligence review or Environmental Assessment.
5.11 TRADING IN PANTHERS COMMON STOCK. Except as otherwise
expressly consented to by the Panther Companies, (i) from the date of this
Agreement until the Effective Time, none of Chensoff and ResortHill (or any
Affiliates thereof) will directly or indirectly purchase or sell (including
short sales) any shares of Panthers Common Stock in any transactions effected
on the Nasdaq National Market or any other exchange on which the Panthers
Common Stock shall hereafter be traded or otherwise, or sell, transfer, pledge,
dispose of or otherwise part with any interest in or with respect to or in any
other manner reduce their investment risk with respect to any shares of
Panthers Common Stock to be received pursuant to this Agreement and (ii) during
the two (2) year period following the Effective Date Chensoff will not directly
or indirectly sell or purchase or enter into any agreement, contract or
arrangement to sell or purchase any put or call options or other derivative
securities (including any short sales) with respect to Panthers Common Stock or
enter into any other agreements, contracts or arrangements providing for the
alteration of Chensoff's investment risk with respect to any shares of Panthers
Common Stock; provided, however, that the foregoing shall not prohibit Chensoff
from making outright, unhedged sales or purchases of Panthers Common Stock
after the Closing except as otherwise limited by Section 1.5 under this
Agreement.
5.12 HSR FILING FEES. Panthers agrees that it shall be responsible
for any filing fees payable to the Federal Trade Commission in connection with
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act filings and other required submissions in connection
therewith, however, if the Merger transaction shall not Close for any reason
then Chensoff agrees that he shall return the amount of such fees to Panthers.
5.13 NO ADDITIONAL ACQUISITIONS OF UNITS. Chensoff and ResortHill
agree that, except for the additional Units described in Section 1.7, neither
LeHill nor any other Affiliate of LeHill, Chensoff or ResortHill shall acquire
any other Units at the Resort without the prior written consent of Panthers.
5.14 NO ACQUISITION BY PANTHERS. No Panther Company, nor any of
its Affiliates or any of its directors or officers (including specifically
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇) (collectively, "Restricted Panthers
Parties") shall purchase or otherwise acquire any interest in any Unit at the
Resort from the date hereof through the Effective Date. In addition, in the
event this Agreement shall terminate for any reason, none of the Restricted
Panthers Parties shall acquire any Unit or any interest therein for a period of
two (2) years following the date of termination hereof.
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ARTICLE VI
CONDITIONS TO THE OBLIGATIONS OF THE PANTHER COMPANIES
The obligations of the Panther Companies to effect the transactions
contemplated hereunder shall be subject to the fulfillment at or prior to the
Effective Time of the following conditions, any or all of which may be waived
in whole or in part by the Panther Companies:
6.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES AND COMPLIANCE WITH
OBLIGATIONS. The representations and warranties of Chensoff and ResortHill
contained in this Agreement shall be true and correct at and as of the
Effective Time with the same force and effect as though made at and as of that
time except (i) for changes specifically permitted by or disclosed pursuant to
this Agreement, and (ii) that those representations and warranties which
address matters only as of a particular date shall remain true and correct as
of such date. Chensoff and ResortHill shall have performed and complied with
all of their respective obligations required by this Agreement to be performed
or complied with at or prior to the Effective Time. Chensoff and ResortHill
shall have delivered to the Panther Companies a certificate, dated as of the
Effective Date, duly signed (in the case of ResortHill, by its President),
certifying that such representations and warranties are true and correct and
that all such obligations have been complied with and performed.
6.2 NO MATERIAL ADVERSE CHANGE OR DESTRUCTION OF PROPERTY.
Between the date hereof and the Effective Time, (i) there shall have been no
Material Adverse Change to any of the LeHill Companies or, to the Best of
Chensoff's Knowledge, the Resort, (ii) there shall have been no adverse
federal, state or local legislative or regulatory change affecting in any
material respect the services, products or business of the LeHill Companies or,
to the Best of Chensoff's Knowledge, the Resort, and (iii) none of the
properties and assets of the LeHill Companies, including, without limitation,
the Units or the units that secure the Mortgages sold by LeHill or, to the Best
of Chensoff's Knowledge, the Resort, shall have been damaged by fire, flood,
casualty, act of God or the public enemy or other cause (regardless of
insurance coverage for such damage) which damages may have a Material Adverse
Effect thereon, and there shall have been delivered to the Panther Companies a
certificate to that effect, dated the Effective Date and signed by or on behalf
of Chensoff and ResortHill.
6.3 CORPORATE CERTIFICATE AND PARTNERSHIP CERTIFICATE. Chensoff
and ResortHill shall have delivered to the Panther Companies (i) copies of the
articles of incorporation and bylaws of ResortHill as in effect immediately
prior to the Effective Time, (ii) copies of resolutions adopted by the board of
directors and shareholders of ResortHill, and (iii) a certificate of good
standing of ResortHill issued by the Secretary of State of the State of
Illinois and as of a date not more than thirty (30) days prior to the Effective
Date, certified in the case of subsections (i) and (ii) of this Section as of
the Effective Date by the Secretary of ResortHill as being true, correct and
complete. Each of LeHill and Pelican Hill shall have delivered to the Panther
Companies (x) copies of the certificate of limited partnership and the
agreement of limited partnership as in effect immediately prior to the
Effective Time and (y) copies of resolutions of Pelican Hill as general partner
of ▇▇▇▇▇▇,
▇▇
▇▇
and of ResortHill as general partner of Pelican Hill, authorizing the
transactions contemplated by this Agreement, certified in the case of
subsections (x) and (y) of this Section 6.3 as of the Effective Date by the
Secretary of each company as being true, correct and complete.
6.4 OPINION OF COUNSEL. The Panther Companies shall have received
an opinion dated as of the Effective Date from counsel for Chensoff and
ResortHill, in form and substance acceptable to the Panther Companies, to the
effect that:
(i) ResortHill is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Illinois and is authorized to carry on the business now conducted by
it and to own or lease the properties now owned or leased by it;
(ii) Each of LeHill and Pelican Hill is a limited
partnership, duly organized, validly existing and in good standing
under the laws of the State of Delaware and is authorized to carry on
the business now conducted by it and to own or lease the properties
now owned or leased by it;
(iii) ResortHill has obtained all necessary
authorizations and consents of its Board of Directors and its
shareholders to effect the transactions contemplated hereunder;
(iv) All issued and outstanding shares of capital
stock of each of the ResortHill and all partnership interests of
LeHill and Pelican Hill are owned as set forth in the Recitals;
(v) Except as to litigation referred to in this
Agreement, such counsel does not know or have reason to believe that
there is any litigation, proceeding or investigation pending or
threatened against any of the LeHill Companies, or which questions the
validity of this Agreement; and
(vi) This Agreement is a valid and binding
obligation of each of Chensoff and ResortHill, and is enforceable
against each of Chensoff and ResortHill, in accordance with its terms,
except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the enforcement of
creditors' rights generally or general equitable principles.
6.5 CONSENTS. Each of Chensoff and ResortHill shall have received
consents to the transactions contemplated hereby and waivers of rights to
terminate or modify any material rights or obligations of any of them from any
Person from whom such consent or waiver is required under any Contract or
instrument as of a date not more than ten days prior to the Effective Date, or
who, as a result of the transactions contemplated hereby, would have such
rights to terminate or modify such Contracts or instruments, either by the
terms thereof or as a matter of law.
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6.6 SECURITIES LAWS. The Panther Companies shall have received
all necessary consents and otherwise complied with any state or federal
securities laws and requirements of the Nasdaq Stock Market or any other
securities exchange on which the Panthers Common Stock shall be listed
applicable to the issuance of the Panthers Shares, in connection with the
transactions contemplated hereby.
6.7 ACKNOWLEDGMENT OF RECEIPT OF SEC FILINGS. At or prior to the
Closing, Chensoff shall have delivered to Panthers a letter agreement
acknowledging receipt of SEC filings of Panthers, in form and substance
satisfactory to the Panthers.
6.8 LEHILL COMPANIES. At the Closing, Chensoff and ResortHill
shall have delivered to the Panther Companies all certificates evidencing the
shares of capital stock of ResortHill.
6.9 STOCK POWERS. At the Closing, Chensoff shall have delivered
to the Panther Companies, for use in connection with the Held Back Shares,
stock powers executed in blank, with signatures guaranteed.
6.10 NO ADVERSE LITIGATION. There shall not be pending or
threatened any action or proceeding by or before any court or other
governmental body which shall seek to restrain, prohibit, invalidate or collect
damages arising out of the transaction contemplated hereunder or any other
transaction contemplated hereby, and which, in the judgment of the Panther
Companies, makes it inadvisable to proceed with the transaction contemplated
hereunder and other transactions contemplated hereby.
6.11 BOARD APPROVAL. The Board of Directors of the Panther
Companies shall have authorized and approved this Agreement, the Merger and the
transactions contemplated hereby.
6.12 HSR ACT WAITING PERIOD. Any applicable HSR Act waiting period
shall have expired or been terminated.
6.13 DUE DILIGENCE REVIEW. The Panther Companies shall be
satisfied with the results of its due diligence review and Environmental
Assessment.
6.14 OTHER APPROVALS. The Panther Companies shall have received
approval for this transaction from its shareholders, if necessary, and shall
have received all necessary approvals of the Nasdaq National Market or any
other securities exchange on which the Panthers Common Stock shall be listed
and shall have obtained all other necessary approvals.
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ARTICLE VII
CONDITIONS TO THE OBLIGATIONS
OF CHENSOFF AND RESORTHILL
The obligations of Chensoff and ResortHill to effect the transactions
contemplated hereunder shall be subject to the fulfillment at or prior to the
Effective Time of the following conditions, any or all of which may be waived
in whole or in part by Chensoff and ResortHill.
7.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES AND COMPLIANCE WITH
OBLIGATIONS. The representations and warranties of the Panther Companies
contained in this Agreement shall be true and correct at and as of the
Effective Time with the same force and effect as though made at and as of that
time except (i) for changes specifically permitted by or disclosed pursuant to
this Agreement, and (ii) that those representations and warranties which
address matters only as of a particular date shall remain true and correct as
of such date. The Panther Companies shall have performed and complied with all
of its obligations required by this Agreement to be performed or complied with
at or prior to the Effective Time. The Panther Companies shall have delivered
to a representative of Chensoff and ResortHill a certificate, dated as of the
Effective Date, and signed by an executive officer, certifying that such
representations and warranties are true and correct and that all such
obligations have been complied with and performed.
7.2 PANTHERS SHARES. At the Closing, Panthers shall have issued
all of the Panthers Shares and shall have delivered to Chensoff, as
appropriate, (i) certificates representing the Panthers Shares issued to them
hereunder (with restrictive legends, as appropriate, pursuant to Rule 145(d)
under the Securities Act and reflecting the restrictions set forth in this
Agreement), other than the Held Back Shares, and (ii) copies of stock
certificates representing the Held Back Shares.
7.3 NO ADVERSE LITIGATION. There shall not be pending or
threatened any action or proceeding by or before any court or other
governmental body which shall seek to restrain, prohibit, invalidate or collect
damages arising out of the transactions contemplated hereunder or any other
transaction contemplated hereby, and which in the reasonable collective
judgment of Chensoff and ResortHill, makes it inadvisable to proceed with the
transactions contemplated hereunder and other transactions contemplated hereby.
7.4 HSR ACT WAITING PERIOD. Provided Chensoff and ResortHill have
timely made any required HSR registration filing, any applicable HSR Act
waiting period shall have expired or been terminated.
7.5 EMPLOYMENT OF CHENSOFF. Chensoff and the Panther Companies
shall have entered into an employment agreement which shall provide for the
employment of Chensoff for a term of three (3) years at a compensation rate of
$250,000 per annum and which shall provide for staff expense reimbursements,
the issue of warrants to purchase Panthers Common Stock to Chensoff and
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the grant of options to purchase Panthers Common Stock to ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, and certain non-compete and other provisions as more specifically
described on Schedule 7.5.
7.6 CONCURRENT CLOSING. The transactions contemplated by the
▇▇▇▇▇▇ Purchase Agreement shall have closed concurrent with the closing of the
transaction contemplated by this Agreement.
7.7 ▇▇▇▇▇▇▇ OPTION. The Panthers shall have executed and
delivered to ▇▇▇▇▇ ▇▇▇▇▇▇▇ a stock option agreement for that number of shares
of Panthers Common Stock set forth in Schedule 7.5 in accordance with the
Panthers Stock Option Plan. The Panther Companies agree that they shall take
any further action reasonably necessary to cause such stock options to be
issued under the Panthers Stock Option Plan or, if ▇▇▇▇▇ ▇▇▇▇▇▇▇ is not
eligible thereunder, cause the issuance of warrants to purchase Panthers Common
Stock on substantially equivalent terms as Chensoff.
7.8 SECURITIES. Panthers shall have taken all action necessary to
file any necessary supplement to its Registration Statement and any
post-effective amendment to its Registration Statement.
ARTICLE VIII
INDEMNIFICATION
8.1 AGREEMENTS TO INDEMNIFY.
(a) By Chensoff. Subject to the terms set forth herein below
including the limitation contained in Section 8.6, Chensoff agrees to indemnify
and hold the Panther Companies harmless from and against the aggregate of all
expenses, losses, costs, deficiencies, liabilities and damages (including,
without limitation, related counsel and paralegal fees and expenses) incurred
or suffered by the Panther Companies arising out of or resulting from (i) any
material breach of a representation or warranty made by Chensoff or ResortHill
in or pursuant to this Agreement, (ii) any material breach of the covenants or
agreements made by Chensoff or ResortHill in or pursuant to this Agreement,
(iii) any material inaccuracy in any certificate, Schedule or other item
delivered by Chensoff or ResortHill pursuant to this Agreement (collectively,
"Panthers Indemnifiable Damages").
(b) By Panthers. Panthers agrees to indemnify
and hold Chensoff and, to the extent applicable, the LeHill Companies and the
Resort, harmless from and against the aggregate of all expenses, losses, costs,
deficiencies, liabilities and damages (including, without limitation, related
counsel and paralegal fees and expenses) incurred or suffered by any of them
arising out of or resulting from (i) any material breach by any Panther Company
of a representation or warranty made by it hereunder, (ii) any material breach
of covenants or agreements made by Panther Companies hereunder or (iii) any
physical damage to the Resort or the land, buildings or
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other improvements constituting the Resort, or any physical injury to persons,
resulting from any environmental due diligence investigation conducted thereon,
including, without limitation, any environmental testing made thereto
(collectively, the "Chensoff Indemnifiable Damages").
8.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties made by Chensoff and ResortHill and the Panther
Companies in this Agreement or pursuant hereto shall survive for a period of
one (1) year after the Effective Time (the "Indemnity Period"). No claim for
the recovery of Panthers Indemnifiable Damages or Chensoff Indemnifiable
Damages may be asserted by one of the parties against another after such
representations and warranties shall thus expire, provided, however, that
claims for Indemnifiable Damages first asserted within the applicable period
shall not thereafter be barred. Notwithstanding any knowledge of facts
determined or determinable by any party by investigation, each party shall have
the right to fully rely on the representations, warranties, covenants and
agreements of the other parties contained in this Agreement or in any other
documents or papers delivered in connection herewith. Each representation,
warranty, covenant and agreement of the parties contained in this Agreement is
independent of each other representation, warranty, covenant and agreement.
However, if a representation in this Agreement contains a disclosure that can
reasonably be inferred to apply to a required disclosure in another
representation in this Agreement then such disclosure shall be deemed contained
in such other representations.
8.3 SECURITY FOR CHENSOFF INDEMNIFICATION OBLIGATION. As security
for the agreement by Chensoff to indemnify and hold Panthers harmless as
described in this Article, at the Closing Panthers shall set aside and hold
certificates representing the Held Back Shares issued pursuant to this
Agreement. The entire amount of the Held Back Shares shall be held for the
Indemnity Period. Panthers may set off against the Held Back Shares any
Indemnifiable Damages for which Chensoff may be responsible pursuant to this
Agreement, subject, however, to the following terms and conditions:
(a) The entire amount of Held Back Shares is
subject to being set off for the actual amount of Panthers
Indemnifiable Damages. The Panthers may set off up to $4,000,000 in
Held Back Shares.
(b) Panthers shall give written notice to
Chensoff of any claim for Panthers Indemnifiable Damages hereunder,
which notice shall set forth (i) the amount of Panthers Indemnifiable
Damages which Panthers claims to have sustained by reason thereof, and
(ii) the basis of such claim;
(c) Such set off shall be effected on the later
to occur of the expiration of 30 days from the date of such notice
(the "Notice of Contest Period") or, if such claim is contested, the
date the dispute is resolved, and such set off shall be charged
proportionally against the shares set aside;
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(d) If, prior to the expiration of the
Notice of Contest Period, Chensoff shall notify Panthers in writing of
an intention to dispute the claim and if such dispute is not resolved
within 30 days after expiration of such period (the "Resolution
Period"), then either party may elect that such dispute shall be
resolved by a committee of three arbitrators (one appointed by
Chensoff, one appointed by Panthers and one appointed by the two
arbitrators so appointed), which shall be appointed within 60 days
after the expiration of the Resolution Period. The arbitrators shall
abide by the rules of the American Arbitration Association and their
decision shall be made within 45 days of being appointed and shall be
final and binding on all parties; and
(e) Chensoff may, not more than once
during the Indemnity Period, instruct Panthers in writing to sell some
or all of the Held Back Shares and Panthers shall utilize reasonable
efforts to promptly sell the Held Back Shares following such written
instruction and the net proceeds thereof shall be substituted for such
Held Back Shares in any set off to be made by Panthers pursuant to any
claim hereunder, subject to continued compliance with any applicable
SEC and other regulations. To the extent that Chensoff exercises his
right to request the sale of Held Back Shares, then any such election
shall reduce the number of Panthers Shares that Chensoff is able to
sell at that time under the restrictions on sale contained in Section
1.5. Such reduction to be applied first to the Panthers Shares with
the longest sale restriction.
(f) With respect to any claim made by a
third party which involves Panthers Indemnifiable Damages in an amount
(determined either on the face of such claim or reasonably determined
by mutual agreement of the parties) less than the potential maximum
liability of Chensoff hereunder at the time of the claim, then
Panthers agrees that Chensoff may undertake the defense and or
settlement of such claim at Chensoff's expense, and any payment by
Chensoff of a judgment on such claim or settlement of such claim shall
be made out of the Held Back Shares.
8.4 VOTING OF AND DIVIDENDS ON THE HELD BACK SHARES. Except with
respect to shares transferred pursuant to the foregoing right of setoff (and in
the case of such shares, until the same are transferred), all Held Back Shares
shall be deemed to be owned by Chensoff and Chensoff shall be entitled to vote
the same; provided, however, that, there shall also be deposited with Panthers
subject to the terms of this Article, all shares of Panthers Common Stock
issued to Chensoff as a result of any stock dividend or stock split and all
cash issuable to Chensoff as a result of any cash dividend, with respect to the
Held Back Shares. All stock and cash issued or paid upon Held Back Shares
shall be distributed to the person or entity entitled to receive such Held Back
Shares together with such Held Back Shares.
8.5 DELIVERY OF HELD BACK SHARES. The Panther Companies agree to
deliver to Chensoff no later than the expiration of the Indemnity Period any
Held Back Shares then held by it (or
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proceeds from the Held Back Shares) unless there then remains unresolved any
claim for Indemnifiable Damages or other damages hereunder as to which notice
has been given, in which event any Held Back Shares remaining on deposit (or
proceeds from the sale of Held Back Shares) after such claim shall have been
satisfied shall be returned to Chensoff promptly after the time of
satisfaction.
8.6 AVAILABILITY OF OTHER REMEDIES. Except as
hereinafter provided in this Section 8.6, if this Merger transaction shall
Close, then the set-off remedies contained in Section 8.3 shall be the
exclusive remedy of Panthers hereunder for financial recovery, provided that
this section shall not prohibit or in any way limit Panthers ability to seek
equitable remedies such as injunctive relief and specific performance, or, if
this Merger transaction shall not Close, from pursuing all of the remedies
available to Panthers under Section 10.2, if applicable, and Chensoff's
liability for Panthers Indemnifiable Damages shall be limited to the $4,000,000
value of Held Back Shares unless the Held Back Shares are insufficient to set
off any claim for Panthers Indemnifiable Damages made hereunder in connection
with a material breach of a representation or warranty made pursuant to
Sections 3.1, 3.2, 3.3, 3.4, 3.12(a) (the "Title Claims"). If Title Claims
arise and the Held Back Shares are insufficient to pay Panthers Indemnifiable
Damages related thereto, then, in such event, the Panther Companies may take
any other action or exercise any other remedy available to it by appropriate
legal proceedings to collect the Panthers Indemnifiable Damages for Title
Claims up to the aggregate value of the Panthers Shares delivered to Chensoff
hereunder (and Panthers ability to collect Panthers Indemnifiable Damages in
expressly limited to such aggregate value of the Panthers Shares delivered to
Chensoff). Panthers liability for Chensoff Indemnifiable Damages shall be
limited to an aggregate amount of $4,000,000.
ARTICLE IX
DEFINITIONS
9.1 DEFINED TERMS. As used herein, the following terms shall have
the following meanings:
"Affiliate" shall have the meaning ascribed to it in Rule
12b-2 of the General Rules and Regulations under the Exchange Act, as
in effect on the date hereof.
"Agency Agreement" means, collectively, that certain "Agency
Agreement" entered into between LeHill, as Unit owner, and Property
Directions, Inc. as the Agent with respect to each of the Units owned
by LeHill.
"Association" means the Association of Unit Owners of the
Registry Hotel at Pelican Bay, Inc., a non-profit corporation
organized to manage the condominium.
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"Association Governing Documents" means Declaration of
Condominium, Articles of Incorporation of the Association of Unit
Owners of the Registry Hotel at Pelican Bay, Inc., By-Laws of the
Association of Unit Owners of the Registry Hotel at Pelican Bay, Inc.
and AUO Management Agreement.
"Best of Chensoff's Knowledge" means that state of awareness
or knowledge without independent investigation or inquiry.
"Contract" means any agreement, contract, lease, note,
mortgage, indenture, loan agreement, franchise agreement, covenant,
employment agreement, license, instrument, purchase and sales order,
commitment, undertaking, obligation, whether written or oral, express
or implied.
"Declaration of Condominium" means the Declaration which sets
forth the nature of the property rights of the various owners of
property in the condominium and the covenants running with the land
which affect such rights. All Condominium Documents shall be subject
to the provisions of the Declaration.
"Environmental Report" shall mean the Phase I environment
audit of the Resort conducted on behalf of the Resolution Trust
Corporation (RTC) and presented to Chensoff at the time of his
acquisition of certain of the Mortgages and Units.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"GAAP" means generally accepted accounting principles in
effect in the United States of America from time to time.
"Governmental Authority" means any nation or government, any
state, regional, local or other political subdivision thereof, and any
entity or official exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.
"HSR Act" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1976, as amended.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including, but not limited
to, any conditional sale or other title retention agreement, any lease
in the nature thereof, and the filing of or agreement to give any
financing statement under the Uniform Commercial Code or comparable
law or any jurisdiction in connection with such mortgage, pledge,
security interest, encumbrance, lien or charge).
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"Management Agreement" means that certain Management Contract
dated as of October 1, 1995 between Property Directions, Inc., as
Agent for the Unit owners, and The Registry Hotel Corporation, a Texas
Corporation, as Operator.
"Material Adverse Change (or Effect)"means a change (or
effect) in the condition (financial or otherwise), properties, assets,
liabilities, rights, obligations, operations, business or prospects,
which change (or effect) individually or in the aggregate is
materially adverse to such condition, properties, assets, liabilities,
rights, obligations, operations, business or prospects.
"Partnership Interests" means the general and limited
partnership interests of the LeHill Partners, L.P., a Delaware limited
partnership.
"Person" means an individual, partnership, corporation,
business trust, joint stock company, estate, trust, unincorporated
association, joint venture, Governmental Authority or other entity, of
whatever nature.
"Register", "registered" and "registration" refer to a
registration of the offering and sale of securities effected by
preparing and filing a registration statement in compliance with the
Securities Act and the declaration or ordering of the effectiveness of
such registration statement.
"Registration Statement" means the Registration Statement on
Form S-1 (Registration Number 333-23135) which was declared effective
by the SEC on June 17, 1997.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Tax Return" means any tax return, filing or information
statement required to be filed in connection with or with respect to
any Taxes; and
"Taxes" means all taxes, fees or other assessments, including,
but not limited to, income, excise, property, sales, franchise,
intangible, withholding, social security and unemployment taxes
imposed by any federal, state, local or foreign governmental agency,
and any interest or penalties related thereto.
9.2 OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined in this Agreement shall
have the defined meanings when used in any certificates, reports or other
documents made or delivered pursuant hereto or thereto, unless the context
otherwise requires.
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(b) Terms defined in the singular shall have a
comparable meaning when used in the plural, and vice versa.
(c) All matters of an accounting nature in
connection with this Agreement and the transactions contemplated hereby shall
be determined in accordance with GAAP applied on a basis consistent with prior
periods, where applicable.
(d) As used herein, the neuter gender shall also
denote the masculine and feminine, and the masculine gender shall also denote
the neuter and feminine, where the context so permits.
ARTICLE X
TERMINATION
10.1 TERMINATION. This Agreement may be terminated at any time
prior to the Effective Time:
(a) by mutual written consent of all of
the parties hereto at any time prior to the Closing; or
(b) by the Panther Companies, in the
event of a material breach by Chensoff and ResortHill of any provision
of this Agreement; or
(c) by Chensoff and ResortHill in the
event of a material breach by the Panther Companies of any provision
of this Agreement; or
(d) by any of the Panther Companies or
Chensoff and ResortHill if the Closing shall not have occurred by (i)
August 15, 1997, or (ii) such later date as the transactions
contemplated by the ▇▇▇▇▇▇ Purchase Agreement shall close including,
upon the grant by ▇▇-▇▇, NPI and LW-RTC (if any grant be made) of an
extension to the closing date by ▇▇-▇▇, NPI and LW-RTC to such later
date on which the HSR Act waiting period shall have expired in
connection with the transactions contemplated under this Agreement..
10.2 EFFECT OF TERMINATION. Except for the provisions of Section
8.1(b)(iii) and Section 5.14 hereof, which shall survive any termination of
this Agreement, in the event of termination of this Agreement pursuant to
Section 10.1(b), the Panther Companies shall be entitled to the return of the
$5,175,000 paid pursuant to the Assignment and Assumption executed concurrently
herewith; otherwise, this Agreement shall forthwith become void and of no
further force and effect and the parties shall be released from any and all
obligations hereunder; provided, however, that nothing herein shall relieve any
party from liability for the willful and intentional
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material breach of any of its representations, warranties, covenants or
agreements set forth in this Agreement.
10.3 WILFUL BREACH OF ▇▇▇▇▇▇ PURCHASE AGREEMENT. In the event that
the purchase transaction contemplated by the ▇▇▇▇▇▇ Purchase Agreement does not
Close due to a breach by ▇▇-▇▇, NPI or LW-RTC of that agreement then the
termination date set forth in Section 10.1(d) shall be extended until Panthers
shall be able to secure its benefits under the ▇▇▇▇▇▇ Purchase Agreement,
provided Panthers diligently and continuously pursue its remedies against such
parties and further such extension shall not exceed one (1) year after the date
of breach.
ARTICLE XI
GENERAL PROVISIONS
11.1 NOTICES. All notices, requests, demands, claims, and other
communications hereunder shall be in writing and shall be delivered by
certified or registered mail (first class postage pre-paid), guaranteed
overnight delivery, or facsimile transmission if such transmission is confirmed
by delivery by certified or registered mail (first class postage pre-paid) or
guaranteed overnight delivery, to the following addresses and telecopy numbers
(or to such other addresses or telecopy numbers which such party shall
designate in writing to the other party):
(a) IF TO THE PANTHER COMPANIES:
Florida Panthers Holdings, Inc.
▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
WITH A COPY TO:
Florida Panthers Holdings, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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WITH A COPY TO:
Akerman, Senterfitt & ▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(b) IF TO CHENSOFF OR RESORTHILL:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Three First National Plaza, Suite 3600
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
WITH A COPY TO:
Ungaretti & ▇▇▇▇▇▇
Three First National Plaza, Suite 3500
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Notice shall be deemed given on the date sent if sent by overnight
delivery or facsimile transmission and on the date delivered (or the date of
refusal of delivery) if sent by certified or registered mail.
11.2 ENTIRE AGREEMENT. This Agreement (including the Exhibits and
Schedules attached hereto), the other documents delivered at the Closing
pursuant hereto and any agreements executed by the parties contemporaneously
with this Agreement, contains the entire understanding of the parties in
respect of its subject matter and supersedes all prior agreements and
understandings (oral or written) between or among the parties with respect to
such subject matter. The Exhibits and Schedules constitute a part hereof as
though set forth in full above.
11.3 EXPENSES. Except as otherwise provided herein, the parties
shall pay their own fees and expenses, including their own counsel fees,
incurred in connection with this Agreement or any transaction contemplated
hereby. The Panther Companies acknowledge that provided it will not result in
a breach of the representation set forth in Section 3.9(b), that LeHill and
ResortHill may use its funds to pay for their and Chensoff's fees and expenses.
11.4 AMENDMENT; WAIVER. This Agreement may not be modified,
amended, supplemented, canceled or discharged, except by written instrument
executed by all parties. No failure to exercise, and no delay in exercising,
any right, power or privilege under this Agreement
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shall operate as a waiver, nor shall any single or partial exercise of any
right, power or privilege hereunder preclude the exercise of any other right,
power or privilege. No waiver of any breach of any provision shall be deemed
to be a waiver of any preceding or succeeding breach of the same or any other
provision, nor shall any waiver be implied from any course of dealing between
the parties. No extension of time for performance of any obligations or other
acts hereunder or under any other agreement shall be deemed to be an extension
of the time for performance of any other obligations or any other acts. Except
as expressly limited hereunder, the rights and remedies of the parties under
this Agreement are in addition to all other rights and remedies, at law or
equity, that they may have against each other.
11.5 BINDING EFFECT; ASSIGNMENT. The rights and obligations of
this Agreement shall bind and inure to the benefit of the parties and their
respective successors and assigns. Nothing expressed or implied herein shall
be construed to give any other person any legal or equitable rights hereunder.
Except as expressly provided herein, the rights and obligations of this
Agreement may not be assigned by any party without the prior written express
consent of all other parties.
11.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together
shall constitute one and the same instrument.
11.7 INTERPRETATION. When a reference is made in this Agreement to
an article, section, paragraph, clause, schedule or exhibit, such reference
shall be deemed to be to this Agreement unless otherwise indicated. The
headings contained herein and on the schedules are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement
or the schedules. Whenever the words "include,""includes" or "including" are
used in this Agreement, they shall be deemed to be followed by the words
"without limitation." Time shall be of the essence in this Agreement.
11.8 GOVERNING LAW; INTERPRETATION. This Agreement shall be
construed in accordance with and governed for all purposes by the laws of the
State of Florida applicable to contracts executed and to be wholly performed
within such State.
11.9 ARM'S LENGTH NEGOTIATIONS. Each party herein expressly
represents and warrants to all other parties hereto that (a) before executing
this Agreement, said party has fully informed itself of the terms, contents,
conditions and effects of this Agreement; (b) said party has relied solely and
completely upon its own judgment in executing this Agreement; (c) said party
has had the opportunity to seek and has obtained the advice of counsel before
executing this Agreement; (d) said party has acted voluntarily and of its own
free will in executing this Agreement; (e) said party is not acting under
duress, whether economic or physical, in executing this Agreement; and (f) this
Agreement is the result of arm's length negotiations conducted by and among the
parties and their respective counsel.
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[Signatures On Following Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
FLORIDA PANTHERS HOLDINGS, INC., a Florida
corporation
By:
-----------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
FPH/RHI ACQUISITION CORP., a Florida
corporation
By:
-----------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, individually
RESORTHILL, INC., a Florida corporation
By:
-----------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
39
EXHIBIT A
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is entered into as
of May 19, 1997 by and between ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("Buyer") and ▇▇-▇▇, a
Delaware corporation ("▇▇-▇▇"), NP Investment III Co., Inc., a Delaware
corporation ("NPI") and LW-RTC, Inc., a Delaware corporation ("LW-RTC") (▇▇-▇▇,
NPI and LW-RTC being collectively referred to as "Seller").
RECITALS
A. ResortHill, Inc., a Delaware corporation and an
affiliate of Buyer ("ResortHill"), and NPI are the general partners and LW-RTC
is the sole limited partner of Pelican Hill, Associates, L.P., a Delaware
limited partnership ("Pelican Hill"), formed pursuant to the terms of a
Partnership Agreement dated as of February 22, 1995 (the "Pelican Hill
Partnership Agreement").
B. Pelican Hill is the sole general partner and
ResortHill and ▇▇-▇▇ are limited partners of LeHill Partners L.P., a Delaware
limited partnership ("LeHill"), formed pursuant to the terms of an Amended and
Restated Limited Partnership Agreement dated as of February 22, 1995, which
partnership owns condominium units and mortgages in a property known as the
Registry Resort and Convention Hotel at Pelican Bay in Naples, Florida (the
"LeHill Assets").
C. Buyer is currently engaged in negotiating with
Florida Panthers Holdings, Inc., a Florida corporation ("FPH"), a potential
transaction in which FPH may acquire, subject to various terms and conditions,
some of the partnership interests in LeHill (the "Potential FPH Transaction").
D. Seller desires, instead of participating in the
Potential FPH Transaction, to sell to Buyer, and Buyer is willing to purchase
from Seller, Seller's entire partnership interests in each of Pelican Hill and
LeHill, all upon the terms and conditions set forth herein.
AGREEMENT
In consideration of the mutual representations, warranties,
covenants and agreements contained herein, the parties hereto agree as follows:
ARTICLE
THE PURCHASE
1. THE CLOSING. Subject to the terms and conditions
of this Agreement, the consummation of the transactions contemplated herein
(the "Closing") shall take place at the offices of Ungaretti & ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ on a date designated by
Buyer, which shall be (a) on or before June 30, 1997 or (b) if Buyer has made
the Extension
40
Payment specified in Section 6, on or before August 15, 1997. The date on
which the Closing occurs is hereinafter referred to as the Closing Date.
2. SELLER'S DELIVERY AT CLOSING. On the Closing Date,
Seller shall deliver to Buyer an assignment of all of Seller's right, title and
interest as a general partner in Pelican Hill and a limited partner in Pelican
Hill and LeHill and of all rights, title and claims Seller may have to the
LeHill Assets as shall exist on the Closing Date (collectively, the "Purchased
Interests"). The Purchased Interests shall be delivered to Buyer at Closing
free and clear of liens, claims or encumbrances.
3. BUYER'S PURCHASE OF THE PURCHASED INTERESTS. On
the Closing Date, in consideration for the Purchased Interests, Buyer shall pay
Seller by wire transfer to an account designated by Seller the Purchase Price,
as defined below, minus (a) One Million Dollars ($1,000,000) of the Initial
Deposit specified in Section 5 of this Article 1 and (b) the Extension Payment,
if any, specified in Section 6 of this Article 1. The Purchase Price shall be
Seventy-Two Million Five Thousand Seven Hundred Fifty-Two Dollars
($72,005,752), subject to increase or decrease, as appropriate, to reflect any
changes in the assumed closing date of June 30, 1997 or the assumed capital
contributions of Two Million One Hundred Thousand Dollars ($2,100,000) needed
to close current condominium unit purchase transactions or the assumption that
the Proposed FPH Transaction is for 321 condominium units.
4. ASSUMED LIABILITIES. From and after the Closing
Date, Buyer shall assume and hold Seller harmless from any and all further
obligation or liability existing on the Closing Date or as may arise in the
future as a result of Seller's interests in Pelican Hill or LeHill. In return,
Seller, on or after the Closing Date, relinquishes any and all rights,
interests or claims it may have or assert against Buyer, other than claims
arising out of Buyer's fraud, bad faith or willful misconduct, with respect to
Pelican Hill, LeHill or the LeHill Assets, and relinquishes any claim on
proceeds derived by ResortHill, Pelican Hill, LeHill, Buyer or any of their
affiliates from consummation of the Potential FPH Transaction.
5. INITIAL DEPOSIT. On the date hereof, Buyer shall
pay Seller by wire transfer to an account designated by Seller the sum of One
Million One Hundred Twenty-Five Thousand Dollars ($1,125,000) (the "Initial
Deposit"). One Hundred Twenty Five Thousand Dollars ($125,000) shall not be
applied toward the Purchase Price.
6. EXTENSION PAYMENT. If at any time on or before
June 30, 1997, Buyer notifies Seller that Buyer is not prepared to close on
June 30, 1997 but still desires to acquire the Purchased Interests (an
"Extension Notice"), and Buyer pays to Seller by wire transfer to an account
designated by Seller the additional sum of Four Million Dollars ($4,000,000)
(the "Extension Payment"), Buyer may extend the Closing Date to a date not
later than August 15, 1997.
7. FORFEITURE OF INITIAL DEPOSIT AND EXTENSION
PAYMENT. The Initial Payment shall be nonrefundable and shall be forfeited to
Seller unless the Closing has occurred on or before June 30, 1997 or Buyer has
delivered the Extension Notice and made the Extension Payment. The Extension
Payment shall likewise be nonrefundable and shall be forfeited to Seller unless
the Closing has occurred on or before August 15, 1997. Forfeiture of the
Initial Deposit and the
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Extension Payment, if any, shall constitute liquidated damages for failure of
Buyer to close and shall constitute Seller's sole and exclusive remedy against
Buyer for such failure. Notwithstanding the foregoing, no forfeiture of the
Initial Payment or the Extension Payment, if any, shall occur, and such
payment(s) shall promptly be refunded, if Seller fails to approve the final
agreement referred to in Section 6 of Article 2 or Buyer's Closing Conditions,
as specified in Section 2 of Article 5 have not been satisfied on or before the
applicable Closing Date.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF BUYER
1. AUTHORITY. Buyer has, and any entity to which
Buyer assigns its rights under this Agreement pursuant to Section 5 of Article
6 (a "Permitted Assignee") will have, the power and authority to execute and
deliver the Agreement, to perform his or its obligations hereunder and to
consummate the transactions contemplated hereby.
2. ORGANIZATIONAL STATUS. Any Permitted Assignee to
which Buyer assigns its rights under this Agreement will be duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization and will have the requisite power and authority to conduct its
business.
3. ENFORCEABILITY. This Agreement has been duly
executed and delivered by Buyer and constitutes a legal, valid and binding
obligation of Buyer, and if Buyer assigns its rights under this Agreement to a
Permitted Assignee, will constitute a legal, valid and binding obligation of
such Permitted Assignee, enforceable against Buyer or such Permitted Assignee,
as the case may be, in accordance with its terms, except as the same may be
limited by applicable laws and general equitable principles regardless of
whether such enforceability is considered in a proceeding at law or in equity.
4. NO VIOLATION. The execution and delivery of this
Agreement by Buyer and the performance of Buyer's obligations hereunder by
Buyer or any Permitted Assignee will not violate or contravene any law,
article, writ, ordinance, rule, regulation, decree, injunction, judgment or
order to which Buyer or such Permitted Assignee is a party or by which either
Buyer or such Permitted Assignee or any of their respective properties is
bound.
5. NO COMMISSIONS. Buyer has not incurred any
obligation for a finder's or other fee or commission in connection with this
transaction.
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6. POTENTIAL FPH TRANSACTION TERMS. Attached hereto
as Exhibit 1 is a summary of the major terms of the Potential FPH Transaction
currently under discussion with FPH. Buyer will advise Seller in writing of
any proposed changes to the terms of the Potential FPH Transaction from those
summarized in Exhibit 1, and Seller will have the right to approve any changes
to such terms of the Potential FPH Transaction, as well as the right to approve
any final agreement between Buyer, any entity owned by Buyer and FPH.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
1. CORPORATE STATUS. Each of ▇▇-▇▇, NPI and LW-RTC is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has the requisite power and authority to
conduct its business.
2. CORPORATE POWER AND AUTHORITY. Seller has the
power and authority to execute and deliver the Agreement, to perform their
obligations hereunder and to consummate the transactions contemplated hereby.
3. ENFORCEABILITY. This Agreement has been duly
executed and delivered by Seller and constitutes a legal, valid and binding
obligation of Seller, enforceable against it in accordance with its terms,
except as the same may be limited by applicable laws and general equitable
principles regardless of whether such enforceability is considered in a
proceeding at law or in equity.
4. NO VIOLATION. The execution and delivery of this
Agreement by Seller and its performance of its obligations hereunder will not
violate or contravene any law, article, writ, ordinance, rule, regulation,
decree, injunction, judgment or order to which it is a party to or by which
either it or any of its property is bound.
5. NO COMMISSIONS. Seller has not incurred any
obligation for a finder's or other fee or commission in connection with this
transaction.
6. OWNERSHIP. Seller has, and upon consummation of
the transactions contemplated by this Agreement, will convey to Buyer, good and
marketable title and interest to the Purchased Interests, free of any liens,
claims or encumbrances whatsoever.
ARTICLE 4
CONDUCT OF BUSINESS PENDING AND AFTER THE CLOSING DATE
1. SELLER'S AGREEMENTS. Seller hereby consents,
subject to its right to approve any final agreement between Buyer, any entity
owned by Buyer and FPH, to ResortHill's acceptance of the FPH Offer and
acknowledges and agrees that:
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(a) Prior to June 30, 1997 (or if Buyer has made
the Extension Payment specified in Section 6 of Article 1,
August 15, 1997), Seller will not solicit offers for, nor
engage in any discussions with respect to the sale of its
interest in, Pelican Hill or LeHill.
(b) Prior to June 30, 1997 (or if Buyer has made
the Extension Payment specified in Section 6 of Article 1,
August 15, 1997), NPI will not exercise its right to become
a "Buying General Partner" or a "Selling General Partner"
pursuant to the provisions of Section 5.1 of the Pelican
Hill Partnership Agreement.
(c) Pending consummation of the transactions
contemplated by the FPH Offer, Buyer and ResortHill may
cause Pelican Hill and LeHill to afford to FPH full and
complete access to the books and records of Pelican Hill and
LeHill and to the LeHill Assets.
(d) Seller will not be entitled to receive any
distributions from either Pelican Hill or LeHill between the
date hereof and the Closing Date or at any time after the
Closing Date, except as specified in Section 3 of this
Article 4.
2. BUYER'S AGREEMENTS. Buyer agrees that:
(a) Prior to the Closing Date Buyer will cause
ResortHill to exercise its fiduciary responsibilities as a
general partner of Pelican Hill and Pelican Hill to exercise
its fiduciary responsibilities as general partner of LeHill,
without regard to the pendency of the transactions
contemplated hereby and the Potential FPH Transaction.
Without limiting the generality of the foregoing, Buyer
agrees that it will not directly or indirectly acquire any
condominium units or mortgages in the Registry Resort other
than through LeHill.
(b) Buyer will include in any agreements with FPH
relating to the Potential FPH Transaction covenants by FPH
that it will not, at any time prior to the Closing Date, (i)
disclose the terms of the Potential FPH Transaction or (ii)
directly or indirectly acquire any condominium units or
mortgages in the Registry Resort.
3. CONSEQUENCE OF FAILURE TO CLOSE. In the event the
transactions contemplated in this Agreement fail to occur: (a) Buyer shall have
no liability to Seller beyond forfeiture of the Initial Deposit and the
Extension Payment, if any; (b) Seller shall remain a general and limited
partner of Pelican Hill and a limited partner of LeHill as if this Agreement
had never been executed; and (c) Seller shall be entitled to receive all
distributions from either Pelican Hill or LeHill that would have been made but
for Section 1(d) of Article 4 of this Agreement.
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ARTICLE 5
CLOSING CONDITIONS
1. SELLER'S CLOSING CONDITIONS. The obligation of
Seller to close the transactions contemplated by this Agreement shall be
conditioned upon (a) the continuing accuracy of Buyer's representations and
warranties in Article 2 and the delivery by Buyer to Seller of a certificate to
that effect; (b) the delivery by Buyer's counsel of an opinion with respect to
the matters specified in Sections 1, 2 and 3 of Article 2; (c) the delivery by
Buyer of the payment specified in Section 3 of Article 1; and (d) the approval
by Seller described in Section 6 of Article 2 of the Potential FPH Transaction.
2. BUYER'S CLOSING CONDITIONS. The obligation of
Buyer to close the transactions contemplated by this Agreement shall be
conditioned upon (a) the continuing accuracy of Seller's representations and
warranties in Article 3 and the delivery by Seller to Buyer of a certificate to
that effect; (b) the delivery by Seller's counsel of an opinion with respect to
the matters specified in Sections 1, 2, 3 and 4 of Article 3; and (c) the
delivery by Seller of the assignment specified in Section 2 of Article 1.
ARTICLE 6
GENERAL PROVISIONS
1. NOTICES. All notices, demands, claims and other
communications hereunder shall be in writing and shall be delivered by
certified mail, guaranteed overnight delivery or confirmed facsimile
transmission to the following addresses and telecopier numbers:
(a) if to Seller, to:
▇▇-▇▇, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇)▇▇▇-▇▇▇▇
NP Investment III Co. Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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LW-RTC, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇)▇▇▇-▇▇▇▇
(b) if to Buyer, to
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Three First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇)▇▇▇▇▇▇▇
2. ENTIRE AGREEMENT. This Agreement represents the
entire agreement between the parties with respect to the subject matter hereof
and supersedes all understandings, either written or oral, between them.
3. GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of Illinois,
without regard to the principles thereof respecting the conflict of laws.
4. AMENDMENT: WAIVER. This Agreement may be amended
only in writing signed by both of the parties, and no provision hereof may be
waived by either party except in writing.
5. ASSIGNMENT. Buyer, upon written notice to Seller,
may assign Buyer's rights under this Agreement to an entity wholly-owned by
Buyer.
6. BINDING EFFECT. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective heirs,
administrators, successors and permitted assigns.
7. NONDISCLOSURE. Neither Seller nor Buyer nor any
Permitted Assignee of Buyer will disclose either the terms of this Agreement or
the terms of the Potential FPH Transaction at any time prior to the Closing
Date.
8. COUNTERPARTS. This Agreement may be executed in
multiple counterparts, which together will constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and the year first above written.
BUYER:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
SELLER:
▇▇-▇▇, INC., a Delaware corporation
By:
------------------------------------
Its:
--------------------------------
NP INVESTMENT II CO., INC., a Delaware
corporation
By:
------------------------------------
Its:
--------------------------------
LW-RTC, INC., a Delaware corporation
By:
------------------------------------
Its:
--------------------------------
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The undersigned, as the general partner of LeHill, hereby consents and
agrees to the transfer to Buyer of the limited partnership interest of Seller
in LeHill contemplated by the foregoing Agreement.
PELICAN HILL ASSOCIATES, L.P., a
Delaware limited partnership
By: ResortHill, Inc., an Illinois
corporation, its general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
The undersigned, as the general partner of Pelican Hill hereby consents
and agrees to the transfer to Buyer of the limited partnership interest of
Seller in Pelican Hill contemplated by the foregoing Agreement.
RESORTHILL, INC., an Illinois corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
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EXHIBIT B
ASSIGNMENT, ASSUMPTION, CONTRIBUTION AND CONSENT AGREEMENT
THIS ASSIGNMENT, ASSUMPTION, CONTRIBUTION AND CONSENT AGREEMENT (this
"Agreement") is entered into as of July ___, 1997, by and among ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ("Chensoff") as assignor; Florida Panthers Holdings, Inc., a Florida
corporation and/or one or more of its assigns ("Panthers") as assignee; ▇▇-▇▇,
a Delaware corporation ("▇▇-▇▇"); NP Investment III Co. Inc., a Delaware
corporation ("NPI") and LW-RTC, Inc., a Delaware corporation ("LW-RTC")
(▇▇-▇▇, NPI and LW-RTC are collectively referred to herein as "Seller").
WHEREAS, Chensoff is a party to that certain Purchase Agreement dated
May 19, 1997 (the "Purchase Agreement", a copy of which is attached hereto as
Exhibit "A") which contemplates the transfer by Seller to Chensoff and his
assigns of certain partnership interests in LeHill Partners L.P., a Delaware
limited partnership ("LeHill") and its sole general partner, Pelican Hill
Associates, L.P., a Delaware limited partnership ("Pelican Hill") (such
partnership interests collectively referred to herein as "▇▇▇▇▇▇ Interests") in
accordance with the terms and conditions thereof. The Purchase Agreement
provides that Seller shall sell, transfer, convey and assign their respective
interests in the ▇▇▇▇▇▇ Interests to Chensoff for a Purchase Price of
Seventy-Two Million Five Thousand Seven Hundred Fifty-Two Dollars ($72,005,752)
subject to increase or decrease as set forth in the Purchase Agreement;
WHEREAS, Purchase Agreement did expire pursuant to its terms on June
30, 1997;
WHEREAS, Chensoff and Seller have agreed to renew, extend and reenter
into the Purchase Agreement on the same terms contained therein, except that
the Extension Notice date shall be July 8, 1997, such renewal to be dated as of
July 1, 1997 by Chensoff and Seller;
WHEREAS, Chensoff wishes to assign his rights under the Purchase
Agreement to Panthers and Panthers has agreed to assume all of Chensoff s
rights and obligations thereunder, and Seller has agreed to consent to such an
assignment and discharge all of Chensoff s obligations under the Purchase
Agreement;
WHEREAS, pursuant to that certain Merger Agreement of even date
herewith (the "Merger Agreement", a form of which is attached hereto as Exhibit
"B"), ResortHill, Inc. an Illinois corporation ("ResortHill") has agreed to
merge with a subsidiary of Panthers;
WHEREAS, pursuant to Section 1.5 of the Merger Agreement, some of the
shares to be delivered to Chensoff will be held back (the "Held Back Shares")
to secure the obligations of Chensoff to indemnify the Panther Companies (as
that term is defined in the Merger Agreement) for the Panthers Indemnifiable
Damages (as that term is defined in the Merger Agreement);
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WHEREAS, under Section 10.2 of the Merger Agreement in the event the
Merger Agreement is terminated under certain circumstances identified therein,
the Panther Companies are entitled to a return of amounts previously paid by
them.
WHEREAS, the Seller and Chensoff desire to allocate certain risks
between themselves.
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth in the Purchase Agreement and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged;
W I T N E S S E T H:
1. Subject to Panthers' payment, to be made not later than 5:00 p.m. local
time in New York City, New York on July 8, 1997, of both (i) an
assignment fee to Chensoff in the amount of $175,000 and (ii) the sum of
$5,000,000 to Seller (representing the $1,000,000 balance of the Initial
Deposit due Seller under Article 1, Section 5 of the Purchase Agreement
and the $4,000,000 Extension Payment under Article 1, Section 6 of the
Purchase Agreement) and subject to Seller extending the Purchase
Agreement until 5:00 p.m. local time in New York City, New York, July 8,
1997, Chensoff does hereby SELL, ASSIGN, TRANSFER, CONVEY, SET OVER AND
CONFIRM to Panthers to have and to hold forever, all of his right, title
and interest of every kind and character whatsoever in the Purchase
Agreement, such assignment and transfer SUBJECT, HOWEVER, to the
condition subsequent that the closing by Panthers of its acquisition of
Seller's interests under the Purchase Agreement must be made concurrently
with the closing of the transaction contemplated under the Merger
Agreement.
2. Panthers hereby agrees to assume and discharge all of Chensoff's rights,
powers, duties and obligations under the Purchase Agreement.
3. Chensoff and Panthers each covenants and agrees with the other that it
will do, execute, acknowledge and deliver, or cause to be done, executed,
acknowledged and delivered, any and all such further acts, instruments,
papers and documents, as may be necessary to carry out and effectuate the
intent and purposes of this Agreement, including, without limitation,
execution of another purchase agreement with Seller on the same terms as
the Purchase Agreement.
4. Except as specifically set forth in the section entitled "Consent of
Seller" below, notwithstanding any of the foregoing provisions, no
provision of this Agreement shall in any way modify, replace, amend,
change, rescind, waive or in any way affect the express provisions
(including, but not limited to, the warranties, covenants, agreements,
conditions, representations and indemnification obligations) set forth in
the Purchase Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.
ASSIGNOR:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
ASSIGNEE:
FLORIDA PANTHERS HOLDING, INC., a
Florida corporation
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
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EXHIBIT C
PLAN OF MERGER
This Plan of Merger (this "Plan") is adopted as of ________________,
1997 among FPH/RHI MERGER CORP., INC., a Florida corporation ("Merger Corp."),
and RESORTHILL, INC., an Illinois corporation (the "Company").
R E C I T A L S
The boards of directors and shareholders of Merger Corp. and the
Company have determined that it is advisable and in the best interests of each
such corporation and its respective shareholders that Merger Corp. be merged
(the "Merger") with and into the Company on the terms and subject to the
conditions set forth herein.
ARTICLE I
THE MERGER
At the Effective Time (as defined in Article V hereof), Merger Corp.
shall be merged with and into the Company in accordance with the Illinois
Business Corporation Act (the "Act"), and the separate existence of Merger
Corp. shall cease and the Company shall thereafter continue as the surviving
corporation (the "Surviving Corporation") under the laws of the State of
Illinois.
ARTICLE II
THE SURVIVING CORPORATION
A. At the Effective Time, the Articles of Incorporation of the
Company, as in effect immediately prior to the Effective Time, shall be the
Articles of Incorporation of the Surviving Corporation.
B. At the Effective Time, the Bylaws of the Company, as in effect
immediately prior to the Effective Time, shall be the Bylaws of the Surviving
Corporation, until thereafter altered, amended or repealed in accordance with
the Act and the Articles of Incorporation and Bylaws of the Surviving
Corporation.
C. At the Effective Time, the officers and directors of Merger
Corp. shall be the officers and directors of the Surviving Corporation until
their successors are elected and have qualified.
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ARTICLE III
MANNER AND BASIS OF CONVERTING SHARES
A. At the Effective Time, each share of common stock of the
Company, no par value (the "Company Common Stock"), which shall be issued and
outstanding (other than shares of Company Common Stock held in treasury) shall,
by virtue of the Merger and without any action on the part of the holder
thereof, be converted into ______________ shares of common stock, $0.01 par
value per share, of Florida Panthers Holdings, Inc., a Florida corporation and
the parent of Merger Corp. ("Panthers Common Stock").
B. At the Effective Time, each share of Company Common Stock held
in treasury shall be canceled and extinguished without any conversion thereof.
C. At the Effective Time, each share of common stock of Merger
Corp., $1.00 par value per share, issued and outstanding immediately prior to
the Effective Time, shall be automatically converted into one share of Company
Common Stock, which shall be the only outstanding common stock of the Surviving
Corporation immediately following the Effective Time.
ARTICLE IV
EFFECTIVE OF MERGER
At the Effective Time, all property, rights, privileges, powers and
franchises of the Company and Merger Corp. shall vest in the Surviving
Corporation, and all liabilities and obligations of the Company and Merger
Corp. shall become liabilities and obligations of the Surviving Corporation.
ARTICLE V
EFFECTIVE TIME
As used in this Agreement, the term "Effective Time" shall mean 12:01
a.m. on __________, 1997.
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