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EXHIBIT 10.4
[EXECUTION COPY]
PURCHASE AND ASSIGNMENT AGREEMENT
AGREEMENT made this 25th day of July, 1997, between GENERAL CINEMA
CORP. OF OKLAHOMA, INC., an Oklahoma corporation ("Seller"), and HOLLYWOOD
THEATERS, INC., a Delaware corporation ("Purchaser").
R E C I T A L S
This Agreement relates to (i) the assignment by Seller to Purchaser of
seven leases referred to in Schedule of Leases to be attached hereto no later
than 10 days following the date hereof (such leases, together with their
respective amendments, modifications and supplements, hereinafter referred to
individually as a "Lease," and collectively referred to as "Leases") as well as
(ii) the sale by Seller to Purchaser of the fixtures and equipment (the
"Assets") located in the respective theatres (hereinafter referred to
individually as a "Theatre," and collectively referred to as "Theatres")
demised by said Leases. The landlords referred to in Schedule of Leases are
individually and collectively hereinafter referred to as "Landlord" and/or
"Landlords," as the context requires.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, the parties hereto agree
as follows:
ARTICLE 1
LEASE ASSIGNMENTS AND SALE OF ASSETS
At the Closing, as hereinafter defined, and subject to the applicable
provisions of this Agreement, Purchaser will buy and assume from Seller, and
Seller will sell the Assets and assign Seller's rights, title and interest to
and obligations under the Leases to Purchaser, for a purchase price of Fifteen
Million Five Hundred Thousand Dollars ($15,500,000), subject to adjustment as
provided herein. With respect to each Theatre, the Assets shall include (i)
all right, title and interest in and to all tangible personal property,
equipment and fixtures of any kind owned or leased by Seller and attached to or
located within or on or customarily used in connection with the operation of
the Theatres, including, but not limited to, seats, merchandise, inventory,
merchantable food and drink, cleaning equipment, office equipment, projection
and sound equipment, screens, carpets, draperies, soundfold, wall coverings,
cash registers, ticket machines, signs (including marquees), projection
supplies, concessions equipment and prepaid utility and rent deposits; (ii) the
rights and interests in the consents, approvals, licenses, permits, franchises
and other authorizations possessed by Seller identified in Schedule of Licenses
to be attached hereto no later than 10 days following the date hereof relating
to the Theatres; (iii) the rights and interests in, to and under the contracts
relating to the Theatres to be listed on Schedule of Contracts to be attached
hereto no later than 10 days following the date hereof; (iv) all right, title
and interest in the names of each of the Theatres (other than the words
"General Cinema" or derivatives thereof and the related logos, trade fixtures
and
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supplies or inventory bearing any logo or ▇▇▇▇ of General Cinema) and any
derivatives or designs of any thereof, either in word form or as a design, and
any other names, trademarks, service marks, trade names, brand names, logos or
slogans incidental thereto or associated therewith; (v) all records of Seller
that are necessary to the continuing operation of the Theatres; (vi) all other
properties and assets of any kind, character and description whatsoever
(whether or not reflected on the books of Seller and whether real, personal or
mixed, tangible or intangible, contingent or otherwise) used, or available for
use, in the business or operations of Seller at the Theatres or necessary for
the continuation of such business or operations consistent with past practice;
and (vii) the items on the mutually approved inventory lists to be attached as
schedules to the Bills of Sale for the Assets substantially in the form
attached as Exhibit A hereto. Specifically excluded from the Assets shall be
(i) accounts receivable attributable to the Theatres, (ii) cash attributable to
the Theatres, (iii) Seller's headquarters, (iv) the Point of Sale System at the
Penn Square Theater (which will be replaced with the system previously in place
and currently on site, which system shall be in good operating condition at
Closing), (v) the concession stand referred to in Section 14.37 hereof, (vi)
the sound systems referred to in Section 14.38 hereof, (vii) the contract
between General Cinema Corp. of Oklahoma, Inc. and Tulsa, Oklahoma, Local No.
513 of the International Alliance of Theatrical Stage Employees, Moving Picture
Machine Technicians, Artists and Allied Crafts of the United States and Canada,
Effective May 31, 1996 to March 26, 1998 (the "Local 513 Agreement") and (viii)
the contract between General Cinema Corp. of Oklahoma, Inc. and Oklahoma City,
Oklahoma, Local No. 380 of the International Alliance of Theatrical Stage
Employees and Moving Picture Machine Operators of the United States and Canada,
Effective May 5, 1995 to May 4, 1998 (the "Local 380 Agreement"). With respect
to each Theatre, the Lease shall be assigned by an Agreement Assigning Lease
substantially in the form attached hereto as Exhibit B.
ARTICLE 2
PAYMENT OF PURCHASE PRICE; SECURITY
The purchase price for the assignment of the Leases and the sale of
Assets hereunder (the "Purchase Price") is Fifteen Million Five Hundred
Thousand Dollars ($15,500,000), plus or minus net prorations and adjustments as
hereinafter provided. On June 17, 1997, Purchaser delivered to Seller the sum
of $100,000 in cash (the "Initial Escrow Funds"), which Seller is holding in
escrow in a segregated interest bearing account with a commercial bank (the
"Purchase Price Escrow Account") as a deposit to be applied toward the Purchase
Price at the Closing. Concurrent with the execution of this Agreement,
Purchaser is delivering to Seller the additional sum of $1,450,000 in cash (the
"Additional Escrow Funds" and, together with the Initial Escrow Funds, the
"Escrow Funds"), which shall be held by Seller in the Purchase Price Escrow
Account as a deposit to be applied toward the Purchase Price at the Closing.
At the Closing, the Escrow Funds and the interest thereon shall be paid to
Seller in partial satisfaction of the Purchase Price, the balance of which
shall be paid by Purchaser to Seller by wire transfer to an account specified
by Seller. If the Closing does not occur under circumstances in which all of
the Purchaser's closing conditions have been satisfied but Purchaser fails to
close for any reason other than a reason within Seller's exclusive control,
then Seller shall be entitled to retain the Escrow Funds. If the Closing does
not occur under circumstances in which (i) all of the Sellers closing
conditions have been satisfied but Seller fails
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to close for any reason other than a reason within Purchaser's exclusive
control, or (ii) all of Purchaser's closing conditions have not been satisfied,
then Seller shall promptly upon request return the Escrow Funds, together with
the interest earned thereon, to Purchaser.
As security for Purchaser's performance under said Lease assignments
through the end of the respective Lease terms, Purchaser shall enter into a
security agreement (each a "Security Agreement") substantially in the form
attached hereto as Exhibit C giving Seller a security interest in the Assets of
the Theatres and shall grant to Seller leasehold mortgages (each a "Leasehold
Mortgage") substantially in the form attached hereto as Exhibit D of its
interests in the Leases. Both the security interest and the Leasehold Mortgage
are to be junior only to a security interest in the Assets of the Theatres to
be held by Purchaser's bank lenders ("Purchaser's Lenders") securing a loan of
not more than $75,000,000 subject to an intercreditor agreement (the
"Intercreditor Agreement") with Purchaser's bank lenders, substantially in the
form attached hereto as Exhibit E.
Purchaser shall establish with a bank acceptable to Purchaser and
Seller an escrow (the "Escrow Account") in the amount of $595,478 (3 months
rent with respect to each of the Theaters) for a period of one year which will
reduce to $297,739 (one and one-half month's rent with respect to each of the
Theaters) for a second year and to zero at the end of the second year (and upon
such reductions in the required escrow amounts, the Escrow Agent shall promptly
release funds attributable to such Lease(s) from the Escrow Account and deliver
such funds to Purchaser); provided that no reduction in the escrow account will
be allowed so long as Purchaser is in default under the Leases or Purchaser's
Net Worth, as defined below, falls below $10,000,000. As used herein
"Purchaser's Net Worth" shall mean Total Shareholder's Equity and Preferred
Stock as established by Purchaser's unaudited quarterly financial statements or
Purchaser's audited year end financial statements. Notwithstanding the
foregoing, in the event that, at or prior to the Closing, Seller shall have
received from one or more Landlords under one or more Leases a release in form
and substance reasonably satisfactory to Seller, releasing Seller (and any
affiliates of Seller that are guarantors thereof), from any and all obligations
and potential liability arising under such Lease or Leases on or after the
"Effective Date" as hereinafter defined (each, a "Release") (i) Purchaser shall
not give Seller a security interest in the Assets located in the related
Theatre or Theaters, (ii) Purchaser shall not grant to Seller a Leasehold
Mortgage of its interest in such Lease or Leases and (iii) the Escrow Account
shall be proportionately reduced to reflect that no rents must be escrowed with
respect to such Theater or Theaters, provided that no reduction will be allowed
so long as Purchaser is in default under any of the other Leases or Purchaser's
Net Worth falls below $10,000,000. To the extent one or more Releases are
obtained after the Closing, (i) Seller shall release its mortgage and security
interests in the related Lease(s) and Assets pursuant to appropriate
documentation and (ii) the Escrow Agent shall promptly release funds
attributable to such Lease(s) from the Escrow Account and deliver such funds to
Purchaser; provided that no reduction will be allowed so long as Purchaser is
in default under any of the other Leases or Purchaser's Net Worth falls below
$10,000,000.
In the event that Purchaser's Net Worth falls below $10,000,000, or
Purchaser (or its successor as tenant under the Leases) is in default under a
Lease remaining uncured for a period
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continuing beyond the period ending five days prior to the expiration of any
applicable grace period (or, if there be no applicable grace period, then upon
the occurrence of such default), there shall be no further reduction in the
Escrow Account, Seller may draw down the funds in the Escrow Account for the
purpose of curing any default under the applicable Lease and may exercise any
or all rights available to Seller under the Security Agreement or any Leasehold
Mortgage as Seller, in Seller's sole discretion, may elect.
ARTICLE 3
CLOSING
The closing of the transactions provided for in this Agreement (the
"Closing") shall take place at the office of Seller, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, on the 5th day of August, 1997 (the "Effective
Date") or at such other location or date as the parties hereto may agree upon
and shall be effective as of 11:59 p.m. on the Effective Date.
ARTICLE 4
CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
4.01 The representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects at and as of the
Effective Date with the same effect as though such representations and
warranties had been made on and as of the Effective Date; Seller shall have
performed and complied with all agreements required by this Agreement to be
performed or complied with by Seller at or prior to the Effective Date; and
Purchaser shall have received certificates, dated as of the Effective Date,
signed by Seller to the foregoing effect.
4.02 No action or proceeding shall have been instituted or threatened for
the purpose or with the possible effect of enjoining or preventing the
consummation of this Agreement or seeking damages on account thereof.
4.03 From the date hereof until Closing, there shall not have occurred any
material casualty or damage (whether or not insured) to any Theatre or Asset
and the business of Seller at the Theatres shall have been conducted only in
the ordinary course consistent with past practices.
4.04 All necessary action (corporate or otherwise) shall have been taken by
Seller to authorize, approve, and adopt this Agreement and the consummation and
performance of the transactions contemplated hereby, and Purchaser shall have
received a certificate, dated as of the Effective Date, signed by Seller to the
foregoing effect.
4.05 Seller shall have terminated all Contracts relating to the Theatres
and the Assets, other than the Contracts to be assumed by Purchaser as
determined by Purchaser after review of the Contracts, but in no case later
than 10 days following the Closing.
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4.06 At the Closing, Seller shall deliver, or cause to be delivered, to
Purchaser each of the documents and items referred to in Article 8.
4.07 At the Closing, Seller shall deliver, or cause to be delivered, to
Purchaser evidence reasonably satisfactory to Purchaser regarding the
termination by Seller prior to Closing of all Persons employed at each Theatre.
4.08 The waiting period under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1974 shall have expired.
4.09 The Landlord for the Penn Square Theater shall have waived the 60 day
notice period under the related Lease to the assignment of such Lease to
Purchaser, or such 60 day period shall have expired; provided, however, that
Seller shall endeavor in good faith to obtain such waiver from the Landlord as
promptly as practicable.
ARTICLE 5
CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
5.01 Purchaser's representations and warranties contained in this Agreement
shall be true and correct in all material respects at and as of the Effective
Date with the same effect as though such representations and warranties had
been made as of the Effective Date; Purchaser shall have performed and complied
with all agreements required by this Agreement to be performed or complied with
by Purchaser at or prior to the Closing; and Seller shall have received a
certificate, dated as of the Effective Date, signed by Purchaser to the
foregoing effect.
5.02 No action or proceeding shall have been instituted or threatened for
the purpose or with the possible effect of enjoining or preventing the
consummation of this Agreement or seeking damages on account thereof.
5.03 All necessary action (corporate or otherwise) shall have been taken by
Purchaser to authorize, approve and adopt this Agreement and the consummation
and performance of the transactions contemplated hereby, and Seller shall have
received a certificate, dated as of the Effective Date, signed by Purchaser to
the foregoing effect.
5.04 At the Closing, Purchaser shall deliver, or cause to be delivered, to
Seller each of the documents and items required to be delivered by Article 7.
5.05 The waiting period under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1974 shall have expired.
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ARTICLE 6
TERMINATION
This Agreement may be terminated prior to the Closing by (a) the
mutual consent of Purchaser and Seller, (b) Seller upon the failure of
Purchaser to perform or comply with any of its covenants or agreements
contained herein prior to or at the Closing or if any representation or
warranty of Purchaser hereunder shall not have been true and correct in all
material respects as of the time at which such was made, (c) Purchaser upon the
failure of Seller to perform or comply with any of its covenants or agreements
contained herein prior to or at the Closing or if any representation or
warranty of Seller hereunder shall not have been true and correct in all
material respects as of the time at which such was made, (d) Seller pursuant to
Article 14.05 of this Agreement, or (e) either Seller or Purchaser if the
Closing does not occur by August 29, 1997, provided, that no party may
terminate this Agreement pursuant to (b) or (c) above if such party is, at the
time of any such attempted termination, in breach of any term hereof.
ARTICLE 7
DELIVERIES BY PURCHASER AT CLOSING
Purchaser shall deliver to Seller at the Closing:
(A) The Purchase Price as set forth in Articles 1 and 2 hereof,
subject to the adjustments set forth in Article 9 hereof.
(B) For each Theatre, respectively, a fully executed Agreement
Assigning Lease substantially in the form attached as Exhibit
B.
(C) For each Theatre, respectively, a fully executed Security
Agreement substantially in the form attached as Exhibit C.
(D) For each Theatre, a fully executed Leasehold Mortgage
substantially in the form attached as Exhibit D.
(E) Executed financing statements to perfect Seller's security
interest under the Security Agreements.
(F) An Intercreditor Agreement, in substantially the form attached
as Exhibit E, providing Seller the right to exercise its
rights under the Security Agreements and/or Leasehold
Mortgages as security in the event of a default under any of
the Leases.
(G) An Escrow Agreement with respect to the Escrow Account (the
Escrow Agreement may be delivered within ten (10) days
following Closing, provided that the Escrow Account is funded
at Closing).
(H) A list of all persons employed by Seller within the thirty
(30) day period prior to the Effective Date to which Purchaser
has made or, to the best of its then current knowledge,
expects to make an offer of employment.
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(I) With respect to each Theatre, a certificate of insurance
evidencing Purchaser's having complied with all insurance
requirements set forth in each Lease, and naming Seller as a
mortgagee and as an additional insured, as appropriate, with
respect to all such insurance policies (provided that this
requirement 7(I) may be satisfied within two (2) business days
following the Effective Date).
(J) Such further executed instruments and documents as may be
requested by Seller and reasonably necessary to fully
consummate the transactions contemplated by this Agreement,
all in form reasonably satisfactory to Purchaser and Seller.
Provided, however, that in the event that, at or prior to the Closing,
Seller shall have received one or more Releases, Purchaser shall not deliver
(i) a Security Agreement for the related Theatre or Theaters, (ii) a Leasehold
Mortgage for the related Lease or Leases, (iii) a financing statement with
respect to any security interest in the assets of such Theatre or Theaters, or
(iv) a certificate of insurance with respect to any insurance policies relating
to such Theatre or Theaters.
ARTICLE 8
DELIVERIES BY SELLER AT CLOSING
At the Closing, Seller shall deliver to Purchaser the following:
(A) The Theatres and Assets free and clear of all Liens or claims
other than the those arising under the Leases.
(B) For each Theatre, respectively, an executed ▇▇▇▇ of Sale for
the Assets substantially in the form attached hereto as
Exhibit A, the schedules to be attached thereto being the
inventory approved by Purchaser and Seller's Director of
Operations at or subsequent to the Initial Inspection (defined
below) of each Theatre.
(C) For each Theatre, respectively, a fully executed Agreement
Assigning Lease substantially in the form attached hereto as
Exhibit B.
(D) Fully executed counterparts of the instruments delivered by
Purchaser in accordance with clauses (C) through (G) of
Article 7.
(E) Subject to Article 13, for each Theatre, a fully executed
Landlord's Consent, Estoppel and Release substantially in the
form attached as Exhibit F or such other form as is acceptable
to Landlord, Seller, Purchaser and Purchaser's Lender.
(F) Such further executed instruments and documents as may be
requested by Purchaser and are reasonably necessary to fully
consummate the transactions contemplated by this Agreement,
all in form reasonably satisfactory to Purchaser and Seller.
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ARTICLE 9
PRORATIONS OF FEES AND EXPENSES
Fees and expenses relating to the Assets, Theatres and Leases,
including, but not limited to, those listed below, shall be prorated between
the parties hereto as of the Effective Date, with Seller bearing the burden of
the fees and expenses existing or arising prior to and on, and relating to
periods ending prior to and on, the Effective Date; and Purchaser bearing the
burden of the fees and expenses existing or arising after and relating to
periods after the Effective Date:
(A) Prepaid fees with respect to Seller's interest in any licenses
and permits transferred by Seller to Purchaser;
(B) Cash on hand at each of the Theatres, or, alternatively,
Purchaser will increase the Purchase Price by the amount of
cash on hand at each Theatre on the Effective Date;
(C) Personal property taxes with respect to the Assets;
(D) Utility charges, including, without limitation, for gas,
electric, telephone, water and sewer with respect to the
Theatres;
(E) All lease charges including without limitation rent, taxes,
common area maintenance fees, merchant's association fees and
similar fees with respect to the Theatres;
(F) Film rental expenses;
(G) Minimum rent payable under the Leases of each and all Theatres
for the month in which the Effective Date occurs; and
(H) Percentage rent, if any, payable under the Leases of each and
all Theatres, which shall be prorated based on the applicable
gross box office and/or concession receipts (as may be
relevant and to the extent so defined in each such Lease)
prior to the Effective Date in the period for which such
percentage rent is payable, as compared to said applicable
gross box office and/or concession receipts in such period
after the Effective Date, and after deducting all credits
(including payment of base rent and, if applicable, payments
of excess film rental) against percentage rent attributable to
such payment period prior to the Effective Date as compared to
all such credits attributable to such period after the
Effective Date.
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To the extent that any of the amounts required to be prorated or paid
for the purchase of property pursuant to this Article 9 are readily
ascertainable as of the Closing (such as minimum rent for the month in which
the Effective Date occurs), such amounts shall be paid at the Closing. With
respect to such amounts as are not readily ascertainable as of the Closing,
interim prorations and payments shall be made after the Closing at regular
intervals promptly after such amounts have been reasonably estimated or
ascertained, and a final proration and payment shall be made as soon as the
amounts required to be prorated have been established, but in no event, with
the exception of expenses and payments to be prorated pursuant to paragraph (H)
of this Article 9, later than September 30, 1997. The parties shall have until
December 31, 1997 to resolve all expenses and payments to be prorated pursuant
to paragraph (H) of this Article 9.
Each of Seller and Purchaser may dispute in good faith any amounts the
other claims to be payable pursuant to this Article 9 by delivering a written
notice to the other party setting forth in reasonable detail the amount and
nature of each disputed matter (each such notice being hereinafter referred to
as a "Dispute Notice") within ten (10) days after receiving a notice that any
such amount is due. Such disputing party shall provide the other party with
such additional information as it may reasonably request as to the basis of
such dispute. The parties shall attempt in good faith to resolve any dispute
as to any matter set forth in a Dispute Notice. If within one (1) month
following the date of the receipt of the Dispute Notice (the "Expiration
Date"), the dispute cannot be resolved through negotiation, mediation or some
other form of alternative dispute resolution ("ADR"), and the amount in dispute
(individually or in the aggregate with other disputes) exceeds Five Thousand
Dollars ($5,000), the dispute shall be submitted for resolution by binding
arbitration in accordance with the rules of the American Arbitration
Association. Within fifteen (15) days of the Expiration Date, the parties
hereto shall jointly select an independent arbitrator who is experienced in the
resolution of disputes of a similar nature. If the parties fail to select an
arbitrator within the period referred to above, the parties shall select an
independent arbitrator, within thirty (30) days from the Expiration Date, from
a panel proposed by the American Arbitration Association. In any such action,
the use of any ADR procedures shall not be construed under the doctrine of
laches, waiver or estoppel to affect adversely the rights of any party.
To the extent they relate specifically to the Theatres, Purchaser
agrees to honor for a period of one (1) year after the Closing valid gift
certificates, VIP tickets and other discount tickets, vouchers or passes issued
by Seller. Seller agrees to promptly reimburse Purchaser the face amount of
such certificates, tickets, vouchers and passes upon receipt of stubs or other
satisfactory evidence that the same were honored.
Seller may be entitled to payments from landlords pursuant to the
Leases resulting from common area maintenance audits, tax abatement proceedings
and other contractual agreements affecting the Leases for periods ending on or
prior to the Effective Date; in the event that such payments are delivered to
Purchaser, Purchaser shall promptly deliver same to Seller.
Notwithstanding anything to the contrary contained in this Agreement,
except with respect to the Leases and the Contracts assumed by Purchaser
pursuant to this Agreement, Purchaser shall
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not assume, pay, perform or discharge any debts, liabilities, expenses or
obligations of Seller of any kind, character or description whatsoever (whether
absolute or contingent, known or unknown, asserted or asserted, whether or not
the same are disclosed to Purchaser in or pursuant to this Agreement).
ARTICLE 10
BROKER
Each of the parties to this Agreement, respectively, warrants and
represents to the other that it dealt with no broker in connection with any of
the transactions referred to herein and agrees to indemnify the other against
any claim arising from its actual or alleged representation by any broker in
connection herewith.
ARTICLE 11
SALES, USE AND TRANSFER TAX
Should any sales or use tax be payable in connection with the sale of
Assets to be sold by Seller to Purchaser pursuant to this Agreement or should
any transfer or similar tax be applicable to any lease assignment herein
contemplated, such sales, use or transfer tax shall be paid by Purchaser,
unless Seller is required by law to pay such tax, in which case the amount
thereof will be paid by Seller. The parties shall cooperate in the reporting
and settlement of any such taxes.
ARTICLE 12
FINANCIAL REPORTS
For the balance of the remaining term of the Leases, Purchaser shall
provide Seller with the following financial information:
1. Monthly reports of revenues generated from each Theatre;
2. Quarterly unaudited financial statements of Purchaser; and
3. Annual audited financial statements of Purchaser.
Provided, however, that in the event that Seller receives a Release
with respect to one or more Leases, Purchaser shall not be required to provide
Seller with monthly reports of revenues generated from the related Theatre(s).
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ARTICLE 13
CONSENTS AND RELEASES
The obligations of Seller and Purchaser hereunder are conditioned upon
the execution and delivery by each of the Landlords, at or prior to the
Closing, of a Landlord's Consent, Estoppel and Release in substantially the
form attached hereto as Exhibit F, or such other form as is acceptable to each
Landlord, respectively, and Seller, Purchaser and Purchaser's Lender; provided,
however, if any Lease may be assigned without the Landlord's consent, or if any
Lease generally requires Landlord's consent to assignment but permits
assignment without such consent to qualified assignees, and Purchaser can
provide evidence, satisfactory to Seller and the Landlord of such Lease, that
Purchaser meets such qualifications for assignment of such Lease without the
Landlord's consent, then, with respect to each such Lease, respectively, the
foregoing condition to the Closing shall be waived. From and after the date of
this Agreement, Seller shall endeavor in good faith to obtain Releases, in form
and substance satisfactory to Purchaser and Seller, through commercially
reasonable efforts from the Landlords under each of the Leases.
ARTICLE 14
MISCELLANEOUS
14.01 This Agreement sets forth the entire understanding of the parties and
supersedes any and all prior agreements, arrangements or understandings
relating to the subject matter hereof. No representations, promises,
inducements or statements of intention have been made by any of the parties
hereto which are not embodied in this Agreement, and neither of the parties
shall be bound by or be liable for any alleged misrepresentation, promise,
inducement or statement of intention not embodied herein, and the parties
acknowledge that they have not relied on any representation or promise, except
as in this Agreement contained.
14.02 From time to time after the date hereof, and at the request of the
other, each of the parties hereto will execute and deliver such further
statements and documents, and take such action as may be reasonably required in
order to implement the transactions contemplated by this Agreement. Seller
agrees to use reasonable efforts to assist with the smooth transition to
Purchaser of the Assets and the operations of the Theatres, provided that such
efforts shall be at no cost to Seller.
14.03 Neither this Agreement nor any provision hereof may be modified,
changed, discharged or terminated, except by an instrument in writing, signed
by the party against whom the enforcement of any modification, change,
discharge or termination is sought.
14.04 Nothing contained in this Agreement or any documents executed at the
Closing shall be construed so as to require a commission of any act contrary to
law; and wherever there is any conflict between any provisions of this
Agreement or any such document and any statute, law, ordinance or regulation,
the latter shall prevail, and the provisions of this Agreement or any such
document affected shall be curtailed and limited only to the extent necessary
to bring it within the requirements of such statute, law, ordinance or
regulation.
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14.05 Purchaser acknowledges that it has inspected each of the Theatres in
the company of Seller's Director of Operations or his designee (the "Initial
Inspection") and that it is familiar with the condition of each of the premises
demised under the Leases as well as with the condition of the Assets to be
purchased and agrees that all of the same are to be conveyed "as is" and
without any warranty, express or implied, as to their physical condition or
fitness for any particular purpose; provided that Seller represents and
warrants that the Assets are sufficient in all material respects to carry on
the business and operations as presently conducted by Seller at the Theatres.
Purchaser specifically agrees that the statements, if any, as to the condition
of Assets set forth in any inventory attached to a ▇▇▇▇ of Sale are for
purposes of identification only and are not intended as representations or
warranties and may not be relied upon by Purchaser. After the date hereof but
prior to Closing, Purchaser shall have the right to inspect the Theatres (the
"Subsequent Inspection") after notice to Seller's Director of Operations and in
the company of such Director of Operations or his designee. It shall be a
condition to Purchaser's obligation to close that the Theatres and the Assets
shall be in substantially the same condition (i.e., no change which
individually or in the aggregate for all the Theatres together would require an
expenditure in excess of $100,000.00 to return to the prior condition) at the
Effective Date as at the Initial Inspection. Notwithstanding the foregoing, if
upon Purchaser's Subsequent Inspection of the Assets, Purchaser reasonably
determines that the Assets are not (i) sufficient in all material respects to
carry on the business and operations as presently conducted by Seller at the
Theatres and (ii) fit for the purposes for which they are presently being used
and in good operating condition and repair, ordinary wear and tear excepted, no
later than 5 days prior to the Closing, Purchaser shall deliver a written
notice to Seller setting forth in reasonable detail the nature and extent of
any repair(s) necessary to restore the Assets to good operating condition.
Upon Seller's receipt of said notice, Purchaser and Seller shall attempt in
good faith to reach agreement as to the nature, extent and estimated cost of
any repair(s) necessary to restore the Assets to good operating condition.
Within 2 days of receipt of said Notice but in no event later than 1 day prior
to the Closing, Seller shall elect in a writing delivered to Purchaser either
to (i) restore the Assets to good operating condition at Seller's expense, (ii)
adjust the Purchase Price by an amount equal to the estimated cost of any
repair(s) necessary to restore the Assets to good operating condition as
determined in good faith by Seller and Purchaser, or (iii) if the amount in
question exceeds $100,000, terminate this Agreement unless Purchaser waives
this condition within two days of receiving such notice of election from
Seller.
14.06 Seller represents and warrants that Seller has not received any notice
that Seller is not in compliance with any applicable governmental requirements
in connection with the ownership or lease of the Assets or the conduct of the
business and operations of Seller at the Theatres.
14.07 Seller hereby represents and warrants to Purchaser that the corporate
officers executing this Agreement and the other documents contemplated by this
Agreement have full corporate authority to do so and that the actions
undertaken by such party in this Agreement and said other documents are fully
binding on Seller.
14.08 Seller hereby agrees to indemnify Purchaser for all direct out of
pocket costs Purchaser may reasonably incur arising out of or in connection
with (i) any and all claims for injury or damage to
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persons or property resulting from any default of or under a Lease or other
matters arising out of or in connection with the conduct of the business and
operation of the Theatres and occurring on or prior to the Effective Date, (ii)
the breach of any representation or warranty of Seller contained in this
Agreement that will survive the Closing as specified in Article 16 and (iii)
any breach of any agreement or covenant of Seller contained in this Agreement
or in any Seller's Ancillary Documents (as hereinafter defined).
14.09 Purchaser hereby agrees to indemnify Seller for all direct out of
pocket costs Seller may reasonably incur arising out of or in connection with
(i) any and all claims for injury or damage to persons or property and
resulting from any default of or under any Lease or other matters arising out
of or in connection with the conduct of the business and operation of the
Theatres and occurring after the Effective Date and (ii) any breach of any
agreement or covenant of Purchaser contained in this Agreement or in any
Purchaser's Ancillary Documents (as hereinafter defined).
14.10 Indemnification for Third Party Claims. The following procedures
shall be applicable with respect to indemnification under Sections 14.08 and
14.09 for third party claims arising in connection with any provision of this
Agreement.
i. Promptly after receipt by the party seeking indemnification
hereunder (an "Indemnitee") of written notice of the assertion
or the commencement of any claim, liability or obligation by a
third party, whether by legal process or otherwise (a
"Claim"), with respect to any matter within the scope of
Section 14.08 or 14.09, the Indemnitee shall give written
notice thereof (the "Notice") to the Person from whom
indemnification is sought pursuant hereto (the "Indemnitor")
and shall thereafter keep the Indemnitor reasonably informed
with respect thereto, provided that the failure of the
Indemnitee to give the Indemnitor prompt notice as provided
herein shall not relieve the Indemnitor of its obligations
hereunder unless such failure results in (i) a default
judgement, (ii) the expiration of the time to answer a
complaint or (iii) material prejudice to Indemnitor's defense
of such Claim. In case any such Claim is brought against any
Indemnitee, the Indemnitor shall be entitled to assume the
defense thereof by written notice of its intention to the
Indemnitee within 30 days after receipt of the Notice, with
counsel reasonably satisfactory to the Indemnitee at the
Indemnitor's own expense. If the Indemnitor shall assume the
defense of such Claim, it shall not settle such Claim without
the prior written consent of the Indemnitee, which consent
shall not be unreasonably withheld. Notwithstanding the
assumption by the Indemnitor of the defense of any Claim as
provided in this Paragraph 14.10, the Indemnitee shall be
permitted to join in the defense of such Claim and to employ
counsel at its own expense.
ii. If the Indemnitor shall fail to notify the Indemnitee of its
desire to assume the defense of any such Claim within the
prescribed period of time, or shall notify the Indemnitee that
it will not assume the defense of any such Claim, then the
Indemnitee shall assume the defense of any such Claim, in
which event it may do so
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in such manner as it may deem appropriate, provided that it
shall not settle any Claim which would give rise to the
Indemnitor's liability under Paragraph 14.08 or 14.09, as the
case may be, without the Indemnitor's prior written consent,
such consent not to be unreasonably withheld. The Indemnitor
shall be permitted to join in the defense of such Claim and to
employ counsel at its own expense.
14.11 Except as expressly provided to the contrary in this Agreement, each
party to this Agreement shall pay its own fees, costs and expenses including,
without limitation, attorneys' fees, costs and expenses incident to the
negotiation, preparation, execution and closing of this Agreement.
14.12 Seller covenants and agrees that it will satisfy, as and when due, any
and all obligations which may have accrued on or prior to the Effective Date to
or with respect to any of its employees employed at or in connection with the
Theatres, including, without limitation, obligations as to or arising out of
any applicable federal or state laws or pension, retirement or benefit plan or
programs. Seller shall (i) on or prior to the Effective Date, provide its
employees presently employed at or in connection with the Theatres with notice
of the proposed transfer of the Theatres, (ii) effective as of the Effective
Date, either terminate the employment of such employees or transfer the
employment of such employees elsewhere within Seller's company or related
companies, and (iii) Seller shall offer benefits pursuant to the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended, to those employees of
Seller eligible to receive such benefits as of the Effective Date.
14.13 Seller represents and warrants as follows:
14.13.1 Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Oklahoma. The
Seller is qualified to do business in each jurisdiction where
the failure to be so qualified would have a material adverse
effect on Seller's ability to consummate the transactions
contemplated by this Agreement or the other agreements and
instruments to be executed and delivered by Seller pursuant to
the terms and provisions of this Agreement (the "Seller's
Ancillary Documents") and to perform its obligations hereunder
and thereunder.
14.13.2 The Seller has all requisite corporate power and authority to
enter into this Agreement and Seller's Ancillary Documents and
to perform its respective obligations hereunder and
thereunder. The execution and delivery by Seller of this
Agreement and Seller's Ancillary Documents and the performance
of Seller's respective obligations hereunder have been duly
authorized by all necessary corporate action on the part of
Seller. This Agreement and Seller's Ancillary Documents have
been duly executed and delivered by Seller, and each document
constitutes a valid and binding obligation of Seller,
enforceable against it in accordance with its terms, except as
enforceability may be limited by the terms of this Agreement
or bankruptcy, insolvency,
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moratorium, fraudulent conveyance or other similar laws
affecting creditors' rights generally or by general principles
of equity.
14.13.3 With such exceptions thereto as do not have a material adverse
effect on the ability of Seller to consummate the transactions
contemplated by this Agreement or Seller's Ancillary Documents
or to perform its obligations hereunder or thereunder, the
execution, delivery and performance by Seller of this
Agreement and each of the Seller's Ancillary Documents, to the
best of Seller's knowledge, does not, and the consummation by
Seller of the transactions contemplated hereby or thereby will
not, with or without the giving of notice or the lapse of time
or both:
i. violate any law to which Seller is subject;
ii. conflict with or result in a breach of or constitute
or result in a default under any of the terms,
conditions or provisions of the certificate of
incorporation or bylaws of Seller or any order to
which Seller is subject or by which it or any Asset
is bound;
iii. except for the respective Landlord's Consent, Estoppel
and Release, require any consent of or filing with or
giving of notice to any Governmental Authority or any
other Person not a party to this Agreement;
iv. violate, or be in conflict with, or constitute a
default under, or permit the termination of any term
or provision of, or result in the acceleration of (or
give the right to accelerate) the maturity or
performance of any obligation of Seller (including
under any note, bond, mortgage, indenture, lease,
license, contract or other instrument to which Seller
is a party or by which its assets, properties or
businesses are bound) or any permit held by Seller or
by which any of its assets are bound; or
v. result in the creation of, or impose on Seller the
obligation to create, any Lien upon the Leases,
Theatres or Assets.
14.13.4 Except as set forth on Schedule of Litigation to be attached
hereto no later than 10 days following the date hereof, there
is no claim, action, suit, proceeding, litigation or order
pending, or to the knowledge of Seller threatened, by or
before any court or governmental authority or private
arbitration tribunal against Seller that relates to this
Agreement, the Theatres or the Assets or any of the
transactions contemplated hereby (i) which would adversely
affect or prevent or delay the consummation of such
transactions
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or the performance of Seller's obligations hereunder, (ii) in
which an adverse decision could, either in any case or in the
aggregate, have a material adverse effect on the business,
operations, affairs, condition (financial or otherwise)
results of operation, properties, assets, liabilities or
prospects of the Theatres, individually or in the aggregate or
(iii) which in any manner draws into question the validity of
or otherwise affects this Agreement, the transactions
contemplated hereby or the ability of Seller to perform its
obligations hereunder.
14.13.5 Seller has delivered to Purchaser true and complete and
correct copies of the Leases.
14.13.6 Seller has delivered to Purchaser true and complete and
correct copies of the financial information with respect to
attendance for 1996, as well as box office revenues,
concession revenues and occupancy costs for the period from
November 1, 1993 through April 30, 1997. There has not been
any material change with respect to attendance, box office
revenues, concession revenues or fixed expenses in the interim
period from the date of such information through the date
hereof, nor has Seller engaged in any material transaction
other than in the ordinary course of business which would
affect attendance, box office revenues, concession revenues or
the fixed items during such interim period. Purchaser
acknowledges that, with respect to Seller's Theatre level
profit and loss statements for the twelve months ended April
30, 1997, Seller makes no warranty regarding such Theatre
level profit and loss statements, Purchaser's bank lenders may
not confirm such statements, and verification of such
statements is not a condition to closing. Except as otherwise
set forth in this paragraph, Seller warrants that all such
facts and information are true, complete and correct, and
Purchaser may rely and has relied thereon in entering into
this Agreement and the transactions contemplated hereby.
14.13.7 Seller has good and marketable title to all of the Assets and
valid leasehold interests in all Leases sold and transferred
by this Agreement and, except for Landlord's liens, the same
are free of all Liens and claims. All Leases are valid,
subsisting and effective in accordance with their terms, and
Seller enjoys peaceful possession of all such properties and
assets. To the knowledge of Seller, there are no leases,
surface or subsurface use agreements, tenancies, arrangements,
service contracts, management contracts, or other agreements,
instruments or encumbrances that will be in force or effect as
of the Closing that grant to any Person any right, title,
interest or benefit in or to all or any part of the Leases,
Theatres or Assets or any right relating to the ownership,
use, operation, management, maintenance or repair of all or
any part of the Leases, Theatres or Assets, and no Person
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has any rights to acquire any of the Leases, Theatres or
Assets. To the knowledge of Seller, there are no third
parties in possession of any portion of the Theatres as
lessees, tenants at sufferance, trespassers or otherwise.
Upon the sale, conveyance, transfer and delivery of the
Leases, Theatres and Assets in accordance with the terms of
this Agreement, Purchaser will (i) acquire good and marketable
title to the Assets, free and clear of all Liens and (ii)
continue to enjoy peaceful possession of the Theatres.
Notwithstanding the foregoing, Purchaser, at its sole cost and
expense, has the right to examine real estate title records
with respect to the real estate demised pursuant to the Leases
until the date that is 60 days after the Effective Date (the
"Title Inspection Period"). Purchaser shall provide Seller
with a copy of any written title report or commitment for
title insurance concerning such title examination within three
(3) days after Purchaser's receipt of such report or
commitment. Title shall be deemed satisfactory unless (i)
Purchaser's title examination reveals the existence of Liens
encumbering the real estate demised pursuant to the Leases
which Liens secure indebtedness in excess of $5,000 per Lease
("Material Liens") and (ii) Purchaser delivers to Seller prior
to 5:00 p.m. Eastern Standard Time on the last day of the
Title Inspection Period, time being of the essence therefor, a
statement of any such Material Liens (the "Material Lien
Statement"). Within ten (10) days after Seller's receipt of
the Material Lien Statement ("Seller's Election Period"),
Seller may elect to (i) remove from the public record such
Material Liens, or (ii) cause the same to be affirmatively
insured against by the title insurer at Seller's expense. In
either event, Seller shall reimburse Purchaser for all direct
out of pocket costs reasonably incurred by Purchaser as a
result of claims of creditors asserted pursuant to such
Material Liens to protect Purchaser's title to the respective
Lease.
In the event that Purchaser timely delivers to Seller the
Material Lien Statement, and Seller does not, within Seller's
Election Period, remove from the public record such Material
Liens or cause the same to be affirmatively insured against by
the title insurer at Seller's expense, Purchaser may, in its
sole discretion, cancel this Agreement and rescind the
transactions contemplated hereby as provided below by written
notice to Seller within ten (10) days after the expiration of
Seller's Election Period, or, alternatively, Purchaser may
waive title objections.
In the event that Purchaser elects to cancel this Agreement as
set forth in the preceding paragraph, within ten (10) days of
the expiration of Seller's Election Period, (i) Purchaser
shall reconvey to Seller the Leases, the Theatres, and the
Assets in substantially the same condition all of the same
were in immediately prior to the Effective Date and free and
clear of all Liens
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and claims excepting only those Liens and claims to which all
of the same were subject immediately prior to the Effective
date and (ii) Seller shall reconvey to Purchaser the Purchase
Price and the Escrow Account. In the event Purchaser is
unable to reconvey to Seller the Leases, the Theatres, and the
Assets as herein provided, Purchaser shall be obligated to
waive title objections.
14.13.8 There are no contracts binding upon the Theatres or the Assets
which are not terminable without penalty upon not more than
thirty (30) days' notice, except for the Leases and the
contracts specifically identified in Schedule of Contracts to
be attached hereto. A true and correct copy of each such
contract listed on Schedule of Contracts shall be delivered to
Purchaser no later than the Effective Date. With respect to
any contracts not canceled as of the Effective Date (unless
assumed by Purchaser), Seller covenants to be responsible for
and to pay all obligations under such contracts until the same
are terminated. No later than the Effective Date, Seller
shall pay any monies earned and owed to any employees of the
Theatres covered by either the Local 513 Agreement or the
Local 380 Agreement, or to any fund related to either such
agreement to which Seller is obligated to contribute, in each
case as of the Effective Date.
14.13.9 Since October 31, 1996, there has not been any damage,
destruction or loss (whether or not insured against) with
respect to the Theatres.
14.13.10 Except for the Local 513 Agreement and the Local 380
Agreement, Seller is not a party to any collective bargaining
agreement with respect to employees of the Theaters, no such
agreement determines the terms and conditions of the
employment of any employee of the Theaters, and no collective
bargaining agent has been certified as a representative of
any of the employees of the Theaters.
14.13.11 Except as set forth on Schedule of Material Events to be
attached hereto no later than 10 days following the date
hereof, and except as contemplated in this Agreement, since
October 31, 1996, there has not been:
i. any material adverse change in Seller's business,
operations, affairs, conditions (financial or
otherwise), results of operations, properties, assets,
liabilities or prospects as they relate to the
Theatres;
ii. any sale, assignment or disposition of any substantial
properties or assets of any kind or character relating
to the operations of the Theatres, except for personal
property sold, assigned or disposed of
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in the ordinary course of business and consistent with
past practice and custom;
iii. any damage, destruction or loss (whether or not
insured against) affecting the Theatres or Assets;
iv. any revocation or termination, or any notice of any
threatened revocation or termination, of any consents
or permits relating to the operations of the Theatres;
v. any material change or any anticipated change in the
present relationships between Seller and any of its
significant suppliers, insurers, lessors, licensors,
licensees and distributors and with respect to the
Theatres or Assets; or
vi. any other material transaction other than in the
ordinary course of business and consistent with past
practice and custom with respect to the Theatres or
Assets.
14.13.12 Seller has not received notice of any claims for Taxes pending
against Seller nor any threatened claims for Tax deficiencies
against Seller for which the Theatres or Assets could be
liable, and Seller does not know of any basis for such claims.
To the knowledge of Seller there exist no actual or proposed
additional assessments or adjustments of Taxes by any taxing
authority for which the Theatres or Assets could be liable.
To Seller's knowledge, there are no pending audits, actions,
proceedings, disputes, claims, or investigations with respect
to any Taxes payable by or asserted against Seller and, to the
knowledge of Seller, there is no basis on which any claim for
material Taxes can be asserted against Seller for which claims
against the Theatres or Assets could be made. All Taxes
required to be withheld or collected by Seller (including, but
not limited to, Taxes required to be withheld with respect to
amounts paid or owing to any officer, employee, creditor,
shareholder, independent contractor or other Person) as they
relate to the Theatres or the Assets have been timely withheld
or collected and, to the extent required, have been timely
paid, remitted or deposited to or with the relevant
Governmental Authority. To the knowledge of Seller, there are
no proposed reassessments of the taxable value of any of the
Theatres or Assets or similar matters pending with respect to
any taxing authority. Seller is not a party to any
outstanding agreements or waivers that would extend the
statutory period in which a taxing authority may assess or
collect a Tax against Seller for which the Theatres or Assets
could be liable. To the knowledge of Seller, there are no
Liens for Taxes (other than for current Taxes not yet due and
payable) imposed upon the Theatres or Assets.
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14.13.13 Seller has not received any notice, and Seller shall give
Purchaser prompt written notice of each and every notice
Seller shall have received, with respect to any Hazardous
Substance (as hereinafter defined) on, from or affecting the
Theatres. Seller is not subject to any existing, pending or
threatened action, suit, investigation, inquiry or proceeding
by any Governmental Authority under, and is not currently in
violation of, or subject to, any remedial obligation under,
any Environmental Law in respect of the Theatres. To the
knowledge of Seller, all environmental notices, permits,
licenses or similar authorizations, if any, required to be
obtained or filed in connection with the operation of the
Theatres have been obtained or filed. To the knowledge of
Seller, Hazardous Substances have not been disposed of on, to
or from any of the Theatres during the time of Seller's
ownership or possession of the Theatres, or prior thereto,
except in compliance with Environmental Laws in effect at the
time such activity was undertaken. To the knowledge of
Seller, no Hazardous Substances have been generated, managed,
treated or transported to or from the Theatres. To the
knowledge of Seller, there is not now at, on or in the
Theatres any asbestos, polychlorinated biphenyl ("PCBs") or,
to the extent only it exists at levels which are considered
hazardous to human health, radon gas. To the knowledge of
Seller, no underground storage tanks currently exist or have
existed on the land occupied by the Theatres. To the
knowledge of Seller, there has not been a Discharge of
Hazardous Substances into, onto or out of the land occupied by
the Theatres. Seller has not released any Person from any
claim under any Environmental Law or waived any rights
concerning any Discharges of Hazardous Substances into, onto
or out of or with respect to the land occupied by the
Theatres. For the purposes of this Subsection, "Hazardous
Substance" means (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form, PCBs and, to the
extent only it exists at levels which are considered hazardous
to human health, radon gas; and (b) any chemicals, materials
or substances defined as or included in the definition of
"hazardous substances," "hazardous waste," "hazardous
materials," "extremely hazardous substances," "toxic
substance," "toxic pollutants," "contaminants," or
"pollutants" or words of similar import, under any applicable
Environmental Laws.
14.13.14 The Theatres are connected to and are served by water, solid
waste and sewage disposal, drainage, telephone, gas,
electricity and other utility equipment facilities and
services required by law or necessary for the operation or use
of the Theatres; and such facilities and services are adequate
for the present use and operation of the Theatres on a fully
occupied basis. Seller has not received notice from any
supplier of water, solid waste and sewage disposal, drainage,
telephone, gas, electricity or other utility services
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to the Theatres that such service is being or will be
terminated or curtailed and Seller has no knowledge that such
termination or curtailment may occur.
14.13.15 To the knowledge of Seller, there are no pending or threatened
condemnation or similar proceedings or assessments affecting
the Theatres or Assets or any part thereof, nor, to the
knowledge of Seller, are any such proceedings or assessments
contemplated by any Governmental Authority.
14.13.16 The books and records of Seller relating to the Theatres
fairly reflect the transactions to which the Theatres or
Assets are or were bound, and such books and records are and
have been properly kept and maintained, with the revenues,
expenses, assets and liabilities of Seller relating to the
Theatres and Assets accurately recorded in all material
respects therein. True, complete and correct copies of such
books and records have been made available for review by
Purchaser and shall be transferred to Purchaser as part of
the Assets.
14.14 Purchaser represents and warrants:
14.14.1 Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
Purchaser is qualified to do business in each jurisdiction
where the failure to be so qualified would have a material
adverse effect on Purchaser's ability to consummate the
transactions contemplated by this Agreement or the other
agreements and instruments, including without limitation the
Leasehold Mortgages and Security Agreements, to be executed
and delivered by Purchaser pursuant to the terms and
provisions of this Agreement ("Purchaser's Ancillary
Documents") and to perform its obligations hereunder and
thereunder.
14.14.2 Purchaser has all requisite corporate power and authority to
enter into this Agreement and Purchaser's Ancillary Documents
and to perform its obligations hereunder and thereunder. The
execution and delivery by Purchaser of this Agreement and
Purchaser's Ancillary Documents and the performance of
Purchaser's obligations hereunder have been duly authorized by
all necessary corporate action on the part of Purchaser. This
Agreement and Purchaser's Ancillary Documents have been duly
executed and delivered by Purchaser, and each document
constitutes a valid and binding obligation of Purchaser,
enforceable against it in accordance with its terms, except as
enforceability may be limited by the terms of this Agreement
or bankruptcy, insolvency, moratorium, fraudulent conveyance
or other similar laws affecting creditors' rights generally or
by general principles of equity.
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14.14.3 With such exceptions thereto as do not have a material adverse
effect on the ability of Purchaser to consummate the
transactions contemplated by this Agreement or Purchaser's
Ancillary Documents or to perform its obligations hereunder or
thereunder, the execution, delivery and performance by
Purchaser of this Agreement and Purchaser's Ancillary
Documents, to the best of Purchaser's knowledge, does not, and
the consummation by Purchaser of the transactions contemplated
hereby or thereby will not, with or without the giving of
notice or the lapse of time or both:
i. violate any law to which Purchaser is subject;
ii. conflict with or result in a breach of or constitute
or result in a default under any of the terms,
conditions or provisions of the certificate of
incorporation or bylaws of Purchaser or any order to
which Purchaser is subject or by which it or any
Asset is bound;
iii. except for the respective Landlord's Consent, Estoppel
and Release and such other consents as shall be
obtained prior to the Closing, require any consent of
or filing with or giving of notice to any Governmental
Authority or any other Person not a party to this
Agreement; or
iv. violate, or be in conflict with, or constitute a
default under, or permit the termination of any term
or provision of, or result in the acceleration of (or
give the right to accelerate) the maturity or
performance of any obligation of Purchaser (including
under any note, bond, mortgage, indenture, lease,
license, contract or other instrument to which a
Purchaser is a party or by which its assets,
properties or businesses are bound) or any permit held
by Purchaser or by which any of its assets are bound.
14.14.4 Except as has been disclosed to Seller, there is no claim,
action, suit, proceeding, litigation or order pending, or to
the knowledge of Purchaser threatened, by or before any court
or governmental authority or private arbitration tribunal
against Purchaser that relates to this Agreement, the Theatres
or the Assets or any of the transactions contemplated hereby
which would adversely affect or prevent or delay the
consummation of such transactions or the performance of
Purchaser's obligations hereunder.
14.14.5 Purchaser operates a chain of motion picture theaters and has
a book net worth (as used in Article VII of each Lease) of not
less than $14,000,000 as of April 30, 1997.
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14.15 Seller declares under penalty of perjury that it is not a Foreign
Person (as defined by the Internal Revenue Code of 1986, as amended (the
"Internal Revenue Code"), and that its federal Employer Number is: ▇▇-▇▇▇▇▇▇▇.
The foregoing shall constitute an affidavit as permitted by Section 1445(b) of
the Internal Revenue Code.
14.16 Purchaser acknowledges that Seller shall not fully comply with
applicable Bulk Sales laws in connection with the transactions contemplated by
this Agreement, but Seller agrees with Purchaser that Seller shall pay and
discharge when due or contest and litigate at its sole expense any and all
claims of creditors which may be asserted against Purchaser with respect to the
Assets sold and transferred by this Agreement by reason of such noncompliance
and further agrees to indemnify and to hold Purchaser harmless from and against
any and all such demands, claims and/or against any action, suit or other
proceeding and/or judgment which may hereafter arise and against any and all
damages, liabilities, costs, fees (including attorneys' fees) and expenses
Purchaser may incur as a result thereof and to promptly remove any lien or
encumbrance which may be placed upon the Assets as a result thereof.
14.17 From and after the date of this Agreement through and including the
Effective Date, Seller shall operate the Theatres in the ordinary course of
business, consistent with past practice, and shall not (i) sell, transfer,
assign, dispose of, mortgage, pledge or encumber, or permit to be sold,
transferred, assigned, disposed of, mortgaged, pledged or encumbered any or all
of the Assets, Leases or Theatres sold and transferred hereunder or remove or
permit to be removed all or any part of said Assets, Leases or Theatres from
any Theatre premises, provided, however, that Seller shall be permitted to sell
its concessions inventory and otherwise operate the Theatres in the ordinary
course of its business consistent with its past practices, or (ii) enter into
any lease, contract or commitment or incur any liabilities or obligations in
connection with said Assets except in the ordinary course of its business
consistent with its past practices.
14.18 Seller hereby agrees that from time to time after Closing it shall (i)
execute, deliver, acknowledge, file and record, or cause to be executed,
delivered, acknowledged, filed and recorded, such further bills of sale, deeds,
general conveyances, endorsements, assignments and other good and sufficient
instruments of sale, conveyance, transfer and delivery and such further
consents, certifications, affidavits and assurances as are required in order to
vest in Purchaser all of Seller's rights, title and interests in and to the
Theatres, the Leases and the Assets or otherwise to consummate and make
effective the transactions contemplated by this Agreement and (ii) take, or
cause to be taken, all actions and do, or cause to be done, all things as are
required in order to put Purchaser in actual possession and operating control
of the Theatres and the Assets or otherwise to accomplish the purposes of this
Agreement.
14.19 Seller covenants and agrees that from and after the date hereof until
Closing, or the earlier termination of this Agreement, Purchaser and its
contractors, agents and employees, at the sole expense of Purchaser, may enter
upon any portion of the Theatres from time to time during reasonable business
hours, without any disruption of the normal conduct of Seller's business at the
Theatres, and with reasonable prior notice to Seller, for the purposes of
inspection (mechanical,
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structural and otherwise), tests, including environmental testing and
examination of the operating condition of the Theatres and Assets. If the
Closing does not occur, Purchaser will compensate Seller for any loss, cost,
damage, liability or expense caused by any action or failure to take any action
on the part of Purchaser during its inspection activities.
In addition, from the date hereof to the Closing, Seller shall give to
Purchaser and its officers, attorneys, accountants, and representatives free,
full, and complete access during reasonable business to the Theatres and Assets
as Purchaser may deem necessary or appropriate; provided, that such due
diligence review will not unreasonably interfere with the operations by Seller
of the Theatres. Seller will provide Purchaser and its officers, attorneys,
accountants and representatives with any information reasonably requested by
them pertaining to income derived from or expenses associated with the Theatres
and Assets.
14.20 From the date hereof to the Closing, Seller shall not take or fail to
take any action which action or failure to take such action shall cause the
representations and warranties made by Seller herein to be untrue or incorrect
as of the Closing. From the date hereof to the Closing, Seller shall use its
reasonable efforts to cause all conditions precedent in Article 4 to be
satisfied by the Closing.
14.21 From the date hereof to the Closing, Seller shall keep in full force
and effect insurance coverage for the Theatres and the Assets in the same
amount and scope to the coverage now maintained covering the Theatres and the
Assets.
14.22 Seller covenants and agrees that, from and after the date hereof,
Seller will in good faith cooperate, and cause its auditors to cooperate, with
Purchaser and its auditors to prepare, as promptly as practicable, audited
financial statements, including balance sheets, income statements and cash flow
statements, for each of Seller's two most recent fiscal years, and unaudited
financial statements for the comparative interim periods following the end of
Seller's most recent fiscal year, with the intent to finalize such financial
statements as promptly as practicable.
14.23 From the date hereof to the Closing, Seller will use its reasonable
efforts to maintain the Theatres and the Assets in their present operating
condition and repair, ordinary wear and tear excepted.
14.24 As used herein, the following terms shall have the following meanings:
"Affiliate" shall mean, with respect to any Person, any other
Person who, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person.
As used herein, the term "control" shall mean the possession,
directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether
by the ownership of voting securities, by contract or
otherwise.
"Contract" means any contract, agreement, arrangement,
understanding or other instrument or obligation (whether oral
or written, pending or executory).
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"Discharge" means any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal,
leaching, or migration into the indoor or outdoor environment,
or into, onto, or out of the Theatres, including the movement
of any Hazardous Substance or other substance through or in
the air, soil, surface water, groundwater or other property.
"Environmental Laws" means any federal, state, local and
foreign laws (including common law), statutes, codes,
ordinances, guides, written policy rules and regulations that
are applicable to the Theatres or Assets, and in each case as
amended, and any judicial or administrative interpretation
thereof, relating to pollution or protection of human health,
the environment or natural resources (including, without
limitation, ambient air, surface water, groundwater, land
surface or subsurface strata), including, without limitation,
laws, statutes, codes ordinances, rules, regulations, consent
decrees and judgements relating to emissions, discharges,
releases or threatened releases of Hazardous Substances, or
otherwise relating to the manufacture processing,
distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Substances.
"Governmental Authority" means any nation or government, any
state or political subdivision thereof, any federal or state
court and any other agency, body, authority or entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Lien" means, with respect to any properties or assets, any
mortgage, pledge, hypothecation, assignment, security
interest, lien or encumbrance or any preference, priority or
other security agreement or preferential arrangement of any
kind or character whatsoever (including, but not limited to,
any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect
as any of the foregoing, and the filing of, or agreement to
give, any financing statement under the Uniform Commercial
Code or comparable law of any jurisdiction) in respect of such
properties or assets.
"Person" means any individual, corporation, limited liability
company, partnership, association, trust or any other entity
or organization of any kind or character, including any
Governmental Authority.
"Taxes" means all taxes, charges, fees, levies or other
assessments (including, but not limited to, income, gross
receipts, excise, property, sales, occupation, use, service
use, license, payroll, franchise, transfer and recording
taxes, fees and charges) imposed by any Governmental
Authority, whether computed on a separate, consolidated,
unitary or combined basis or in any other manner, and includes
any interest, penalties and additions to any tax.
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14.25 All of the representations and warranties of Seller which are limited
to "the knowledge of Seller" are based on, and are limited to, the actual
knowledge of Seller's Director of Operations for the Theatres after reasonable
inquiry relating to the substance of the representation or warranty. "Actual
knowledge" means only that information which is in fact known to one or more of
the aforesaid and excludes information which is not so known by any of them
even if it would or might be obtained from an investigation to determine the
existence of such facts and is known to Persons other than the aforesaid,
whether or not they may be employees of Seller or any Affiliate thereof.
14.26 Notices. All notices and other communications hereunder shall be
given by delivery in person, by registered or certified mail (return receipt
requested with postage prepaid thereon) or by facsimile transmission to the
respective parties at the following addresses (or at such other address as
either party shall have furnished to the other in accordance with the terms of
this Section):
If to Seller:
General Cinema Corp. of Oklahoma, Inc.
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
General Cinema Corp. of Oklahoma, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser:
Hollywood Theatres, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy to:
▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
All notices and other communications hereunder that are addressed as provided
in or pursuant to this Section shall be deemed duly and validly given (i) if
delivered in person, upon delivery, (ii) if delivered by registered or
certified mail, 72 hours after being placed in a depository of the United
States Mails or (iii) if delivered by facsimile transmission, upon transmission
thereof and receipt of the appropriate answer back.
14.27 Entire Agreement. This Agreement, including the Exhibits and
Schedules hereto, constitutes the entire agreement among the parties with
respect to the transactions contemplated hereby and supersedes all prior oral
or written agreements and understandings with respect thereto. All Exhibits
and Schedules hereto are expressly made a part of this Agreement and are
incorporated herein by reference.
14.28 Parties in Interest; Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns (it being understood and agreed that, except as expressly
provided herein, nothing contained in this Agreement is intended to confer upon
any other Person any rights, benefits or remedies of any kind or character
whatsoever under or by reason of this Agreement). Neither party may assign
this Agreement without the prior written consent of each of the other parties
hereto.
14.29 Amendment; Waivers. This Agreement may be amended only by a written
instrument duly executed and delivered on behalf of each of the parties hereto,
and compliance with any term or provision hereof may be waived only by a
written instrument executed by each party entitled to the benefits thereof. No
failure to exercise any right, power or privilege granted hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege granted hereunder.
14.30 Severability. In the event that any term or provision contained in
this Agreement is held to be invalid, illegal or unenforceable for any reason,
the invalidity, illegality or unenforceability thereof shall not affect any
other term or provision hereof and this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.
14.31 Specific Performance. The parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with the terms hereof. Accordingly, the
parties agree that each of them shall be entitled to injunctive relief to
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prevent breaches of the terms of this Agreement and to obtain specific
performance of the terms hereof, in addition to any other remedy now or
hereafter available at law or in equity, or otherwise.
14.32 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Oklahoma, without regard to
principles of conflicts of law, except to the extent that mandatory principles
of conflicts of law require the application of laws of another jurisdiction
wherein any of the Assets are located to determine the validity or effect of
the sale, conveyance, transfer or delivery thereof in accordance with the
provisions of this Agreement.
14.33 Headings. The Article and Paragraph headings contained in this
Agreement are for convenience of reference only, do not constitute a part of
this Agreement and shall not limit, extend or otherwise affect the meaning or
interpretation of the provisions hereof.
14.34 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute
one and the same instrument.
14.35 Press Releases. None of the parties hereto shall issue press releases
or other public communications of any sort relating to this Agreement prior to
Closing; provided, however, that the parties shall be entitled to make such
disclosures as may be required pursuant to applicable law or the lawful
requirement of any Governmental Authority or by order of a court of competent
jurisdiction.
14.36 Purchaser will have secured, as of the Effective Date, financing
sufficient to fund the closing of the transactions contemplated by this
Agreement.
14.37 Purchaser understands that Seller is building a new concession stand
at the Penn Square Theater in Oklahoma City at a cost of $147,000, including
equipment and construction related to the renovation of the concession stand.
Purchaser will reimburse Seller for such costs if such costs are paid prior to
the Closing or will assume responsibility for payment of such costs if they are
not due until after the Closing, in each case subject to a maximum
reimbursement or payment of $147,000. Such reimbursement or assumption
obligation shall be in addition to the obligation to pay the Purchase Price
pursuant to Articles 1 and 2 hereof.
14.38 Purchaser understands that, prior to the date hereof, Seller has been
leasing the sound system currently installed in each of the Theaters. In
consideration of the purchase and sale of such sound systems in each Theater,
Purchaser agrees to make a one-time payment to Seller at the Closing of
$179,040, or such amount as may subsequently be agreed to by the parties
following execution of this Agreement. Such one-time payment shall be in
addition to the obligation to pay the Purchase Price pursuant to Articles 1 and
2 hereof, and shall constitute Purchaser's entire obligation with respect to
the sound system in each of the Theaters. After making such payment to Seller,
Seller agrees that Purchaser shall own all right, title and interest in and to
such sound systems, and that Purchaser shall have no obligations with respect
to the leases entered into between Seller and the lessor of such sound systems.
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ARTICLE 15
NON-COMPETITION AGREEMENT
Except as otherwise consented to or approved in writing by Purchaser,
Seller agrees that neither Seller nor any of Seller's Affiliates will at any
time for a period of three (3) years following the Closing, directly or
indirectly, acting alone or in conjunction with any Person, or as a holder,
beneficially or of record, of in excess of 5% of any security of any class, or
as a consultant to or representative of, any Person:
(A) engage in the business of Purchaser as it is being conducted
immediately following the Closing in competition with
Purchaser at any location with a 3 1/2 mile radius of any
Theatre location; or
(B) request any present or future supplier of, distributor to or
provider of services to Purchaser to curtail or cancel its
business with Purchaser in respect of the operations at any
Theatre and the use and operation of the Assets; or
(C) unless otherwise required by law, disclose to any Person any
details of the organization or affairs of the business of
Purchaser or any other nonpublic information concerning the
Theatres or Assets or the conduct of the operations at the
Theatres.
Seller and Seller's Affiliates acknowledge that in the event the scope
of the covenants set forth in this Article 15 is deemed to be too broad in any
court proceeding, the court may reduce such scope to that which it deems
reasonable under the circumstances. The parties hereto agree and acknowledge
that Purchaser does not have any adequate remedy at law for the breach or
threatened breach by Seller or Seller's Affiliates of the agreements set forth
in this Article 15 and, accordingly, Purchaser may in lieu of or in addition to
the other remedies that may be available to it hereunder (including its rights
to indemnification hereunder) or under applicable law, file a suite in equity
to enjoin Seller or Seller's Affiliates from such breach or threatened breach
and consent to the issuance of injunctive relief hereunder.
ARTICLE 16
SURVIVAL OF REPRESENTATIONS AND AGREEMENTS
16.01 Except as otherwise expressly provided herein, none of the
representations and warranties contained in this Agreement or in any Seller's
Ancillary Documents or Purchaser's Ancillary Documents shall survive the
Closing. The representations and warranties contained in Sections 14.13.12 and
14.13.13, the last sentence of the first paragraph of Section 14.13.7 and the
last two sentences of Section 14.13.8 of this Agreement shall survive the
Closing and the consummation of the transactions contemplated hereby and
thereby and shall continue in full force and effect for one (1) year after the
Effective Date.
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16.02 Each covenant and agreement set forth in this Agreement or in any
Seller's Ancillary Document or in any Purchaser's Ancillary Documents to be
performed after the Closing will survive the Closing in accordance with its
terms.
ARTICLE 17
PURCHASER'S SUBSEQUENT TRANSFER
Purchaser hereby represents and warrants that it is purchasing the
Theatres with the intent of owning and operating them indefinitely, such
representation and warranty constituting a material part of the consideration
to Seller hereunder and being relied upon by Seller in connection with its
willingness to enter into this Agreement. Accordingly, Purchaser agrees that
if, during the period of three (3) years from the Effective Date, any interest
in any of the Theatres or Assets shall be sold, leased, assigned or otherwise
conveyed in any manner (other than with respect to the Assets in the ordinary
course of business) to any party that is not a subsidiary or Affiliate of
Purchaser or if a binding agreement be entered into to do any of the foregoing
(any such event hereinafter a "Transfer"), then Purchaser or any subsequent
holder of such interest shall (i) notify Seller of such Transfer, and (ii) pay
to Seller at the time of such Transfer a one-time fee of $25,000. This Article
17 shall apply only to the Transfer of the Theaters, either individually or
together, or in connection with the sale by Purchaser of all of its theaters in
Oklahoma as a unit, but not in connection with the sale, lease, assignment or
other conveyance of any other assets, properties or theaters of Purchaser or
the merger or consolidation of Purchaser with any other Person.
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Executed as a sealed instrument on the day and year above first
written in several counterparts each of which shall be an original.
PURCHASER: SELLER:
HOLLYWOOD THEATERS, INC. GENERAL CINEMA CORP.
OF OKLAHOMA, INC.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ By /s/ ▇▇▇▇ ▇. Del Rossi
---------------------------- ----------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. Del Rossi
Vice President and Chief President
Financial Officer
32
[EXECUTION COPY]
AMENDMENT NO. 1 TO PURCHASE AND ASSIGNMENT AGREEMENT
AMENDMENT NO. 1 TO PURCHASE AND ASSIGNMENT AGREEMENT made this 30th day
of July 1997, between GENERAL CINEMA CORP. OF OKLAHOMA, INC., an Oklahoma
corporation ("Seller"), and HOLLYWOOD THEATERS, INC., a Delaware corporation
("Purchaser"). Capitalized terms used herein without definition shall have the
respective meanings set forth in the Purchase Agreement (as defined herein).
RECITALS
WHEREAS, on July 25, 1997, Seller and Purchaser entered into that certain
Purchase and Assignment Agreement (the "Purchase Agreement") pursuant to which
Purchaser agreed to buy from Seller, and Seller agreed to sell to Purchaser,
all of Seller's right, title and interest in and to certain theater leases
relating to seven motion picture theaters located in the cities of Tulsa and
Oklahoma City, in the State of Oklahoma (the "Theaters"), along with the assets
related to such theaters (the "Acquisition");
WHEREAS, Article 3 of the Purchase Agreement provides that the closing of
the transactions contemplated by the Purchase Agreement shall take place on
August 5, 1997; and
WHEREAS, Seller and Purchaser desire to enter into this Amendment No. 1
to the Purchase Agreement to establish certain changes in the procedures to be
followed in consummating the Acquisition and turning over control of the
Theaters from Seller to Purchaser.
WITNESSETH
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, the parties hereto agree
as follows:
18 The Signing Date.
18.01 On August 7, 1997, Seller and Purchaser will consummate the
Acquisition by signing all such documents as are necessary to effect the
closing of the transactions contemplated by the Purchase Agreement, including
those documents referred to in Articles 7 and 8 thereof. All such documents
shall be dated to be effective as of the Effective Date as specified below, and
shall be held in escrow by ▇▇▇▇▇ & ▇▇▇▇▇, L.L.P. pending the Effective Date and
the payment of the Purchase Price in consideration of the assignment of the
Leases and Assets as specified in the Purchase Agreement and herein.
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33
18.02 Simultaneously with the signing of the documents described in the
preceding paragraph, Purchaser will deposit the following in escrow in a
segregated interest bearing account with a commercial bank (the "Purchase Price
Account"): (i) the Purchase Price, less the Escrow Funds, (ii) all amounts
required to be deposited in the Escrow Account pursuant to Article 2 of the
Purchase Agreement, and (iii) the amounts required to be reimbursed or paid
pursuant to Sections 14.37 and 14.38 of the Purchase Agreement (collectively,
with the amounts set forth in clauses (i) and (ii) of this paragraph, the "Cash
Deposit").
19 The Effective Date.
19.01 The Purchase Agreement is hereby amended to provide that the
"Effective Date" shall be the 14th day of August, 1997.
19.02 On the Effective date, Purchaser shall deliver to Seller the Cash
Deposit from the Purchase Price Account for application by the Seller to the
Purchase Price (subject to the adjustments set forth in Article 9 of the
Purchase Agreement), the funding of the Escrow Account and the reimbursements
and payments required by Sections 14.37 and 14.38. Purchaser shall be entitled
to interest earned on the funds in the Purchase Price Account. Upon such
delivery of the Cash Deposit, the transactions contemplated by the Purchase
Agreement shall be deemed to have "Closed" and all documents referred to in
Section 1 above shall become effective without any further act of any party.
19.03 At midnight on the Effective Date, Seller shall turn over control
and all operations of the Theaters to Purchaser.
20 Miscellaneous.
20.01 This Amendment No. 1 may be amended only by a written instrument
duly executed and delivered on behalf of each of the parties hereto, and
compliance with any term or provision hereof may be waived only by a written
instrument executed by each party entitled to the benefits thereof.
20.02 This Amendment No. 1 shall be governed by, and construed in
accordance with, the laws of the State of Oklahoma, without regard to
principles of conflicts of law.
20.03 The headings contained in this Amendment No. 1 are for convenience
of reference only, do not constitute a part of this Amendment No. 1 and shall
not limit, extend or otherwise affect the meaning or interpretation of the
provisions hereof.
20.04 This Amendment No. 1 may be executed in counterparts, each of which
shall be deemed an original but all of which together shall constitute one and
the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 1
as of the date first above written.
GENERAL CINEMA CORP. OF OKLAHOMA, INC.
By: /s/ ▇▇▇▇ Del Rossi
--------------------------------------
Name: ▇▇▇▇ Del ▇▇▇▇▇
------------------------------------
Title: President
-----------------------------------
HOLLYWOOD THEATERS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
------------------------------------
Title: Vice President
-----------------------------------