EXHIBIT
2.1
STOCK
PURCHASE AGREEMENT
BY AND
AMONG
MONACO
COACH CORPORATION,
MCC
ACQUISITION CORPORATION,
OUTDOOR
RESORTS OF AMERICA, INC.,
AND
OUTDOOR
RESORTS OF NAPLES, INC.,
Dated as
of November 27, 2002
TABLE
OF CONTENTS
i
ii
iii
INDEX OF SCHEDULES AND EXHIBITS
iv
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the “Agreement”)
is made and entered into as of November 27, 2002 by and among Monaco Coach
Corporation, a Delaware corporation (“Monaco”), MCC Acquisition Corporation, a
Delaware corporation and a wholly-owned subsidiary of Monaco (“Buyer”), Outdoor Resorts of America, Inc.,
a Delaware corporation (“ORA”),
and Outdoor Resorts of Naples, Inc., a Florida corporation and a wholly-owned
subsidiary of ORA (the “Company).
RECITALS
A. ORA
owns all of the issued and outstanding capital stock of the Company, consisting
of 100 shares (the “Shares”) of the Company’s Class A common
stock (“Common
Stock”).
B. The
Boards of Directors of each of the Buyer and the Company believe it is in the
best interests of each company and their respective stockholders that Buyer
acquire the Company through the purchase of all the outstanding Common Stock
directly from ORA (the “Acquisition”), and, in furtherance thereof,
have approved the Acquisition.
C. Concurrently
with the execution and delivery of this Agreement, Monaco, Buyer, ORA, and
Outdoor Resorts Motorcoach Country Club, Inc., a California corporation (“ORMCC”), are entering into a Stock Purchase
Agreement (the “ORMCC Agreement”)
pursuant to which Buyer will purchase all the outstanding capital stock of
ORMCC (the “ORMCC Acquisition”).
D. Concurrently
with the execution and delivery of this Agreement, Monaco, Buyer, ORA, and
Outdoor Resorts of Las Vegas, Inc., a Nevada corporation (“ORLV”) are entering into a Stock Purchase
Agreement (the “ORLV Agreement”)
pursuant to which Buyer will purchase all the outstanding capital stock of ORLV
(the “ORLV Acquisition”).
E. Concurrently
with the execution and delivery of this Agreement, the Principals (as defined
below) are entering into a Guaranty in favor of Monaco and Buyer in the form
attached hereto as Exhibit A (the “Guaranty”)
pursuant to which the Principals are agreeing to guarantee ORA’s obligations
under ARTICLE VII of this Agreement.
F. Concurrently
with the execution and delivery of this Agreement, Monaco, Buyer, ORA, the
Company, ORMCC, ORLV and the Principals are entering into an Affiliates
Agreement in the form attached
hereto as Exhibit B (the “Affiliates Agreement”) pursuant to which
Monaco, Buyer, ORA, the Company, ORMCC, ORLV and the Principals release each
other from certain liabilities and the Principals agree to vote any shares of
stock of ORA held by them in favor of this Agreement and the transactions contemplated
hereby.
Now, therefore, in
consideration of the covenants, promises and representations set forth herein,
and for other good and valuable consideration, the parties agree as follows:
PURCHASE
AND SALE OF COMPANY CAPITAL STOCK
1.1 Purchase and Sale. At the Closing
(as defined in Section 1.2) and subject to and upon the terms and
conditions of this Agreement, Buyer shall purchase from ORA and ORA shall sell,
convey, transfer, assign and deliver to Buyer, free and clear of all liens, encumbrances
or other defects of title, all the Shares.
1.2 Closing Date. Unless
this Agreement is earlier terminated pursuant to Sections 5.10, 5.11,
5.12, 8.1 or 8.2, or the rights and obligations of the parties are limited
as set forth in Section 4.2(c), the closing of the Acquisition (the
“Closing”)
will take place simultaneously with the closing of the ORMCC Acquisition and
the ORLV Acquisition and as promptly as practicable, but no later than five (5)
business days, following satisfaction or waiver of the conditions set forth in ARTICLE
VI, at the offices of Wilson Sonsini Goodrich & Rosati, 650 Page Mill
Road, Palo Alto, California, unless another place or time is agreed to in
writing by Monaco and ORA. The date
upon which the Closing actually occurs is herein referred to as the “Closing
Date”.
1.3 Certain Definitions. For the
purposes of this Agreement, the following capitalized terms have the following
meanings:
(a) “Accounts
Receivable” shall have the meaning set forth in Section 2.17(a).
(b) “Acquisition”
shall have the meaning set forth in the recitals.
(c) “Agreement”
shall have the meaning set forth in the preamble.
(d) “ACOE
Permits” shall mean the permits required for the development of the Project
by the Army Corps of Engineers.
(e) “Affiliates
Agreement” shall have the meaning set forth in the recitals.
(f) “Alternate
Transaction” shall have the meaning set forth in Section 4.3(a).
(g) “Annual
Financials” shall have the meaning set forth in Section 2.5.
(h) “Applicable
Levels of Regulatory Concern” shall mean those soil or groundwater clean-up
standards existing as of the Closing Date and applicable to the affected
property adopted pursuant to Environmental Laws or otherwise imposed by any
Governmental Entity pursuant to Environmental Laws.
(i) “Approvals”
shall have the meaning set forth in Section 2.26(f).
(j) “A.R.M.”
shall have the meaning set forth in Section 2.26(q).
(k) “A.R.M.
Closing Date” shall have the meaning set forth in Section 4.2(a).
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(l) “A.R.M.
Contract” shall have the meaning set forth in Section 2.26(q).
(m) “A.R.M.
Net Profit” shall have the meaning set forth in Section 4.2(a).
(n) “A.R.M.
Sale” shall have the meaning set forth in Section 4.2.
(o) “BankAtlantic
Loan” shall mean that certain loan in the amount of $2.9 million made by
BankAtlantic, a Federal Savings Bank (“BankAtlantic”), evidenced by a note
dated September 20, 2001 from the Company in favor of BankAtlantic and secured
by a mortgage dated September 28, 2000, as amended by that certain Receipt for
Future Advance and Mortgage Modification Agreement dated September 20, 2001 on
the Property.
(p) “Benefits
Liabilities” means any and all claims, debts, liabilities,
commitments and obligations, whether fixed, contingent or absolute, matured or
unmatured, liquidated or unliquidated, accrued or unaccrued, known or unknown,
whenever or however arising, including all costs and expenses relating thereto
arising under law, rule, regulation, permits, action or proceeding before any
Governmental Entity, order or consent decree or any award of any arbitrator of
any kind relating to any Plan, Employment Agreement or otherwise to an
Employee.
(q)
“Buyer” shall have the meaning set forth in the preamble.
(r) “Closing”
shall have the meaning set forth in Section 1.2.
(s) “Closing
Costs” shall mean the sum of (a) the premium charged for the Title Policy
other than premiums for any endorsements requested by Buyer, (b) charges and
fees required to cause title to the Property to be free and clear of all liens,
restrictions and encumbrances except Permitted Exceptions and (c) the closing
or escrow charges by the title company issuing the Title Policy.
(t) “Closing
Date” shall have the meaning set forth in Section 1.2.
(u) “Code”
shall mean the Internal Revenue Code of 1986, as amended, or any successor
thereto.
(v) “Common
Stock” shall have the meaning set forth in the recitals.
(w) “Company”
shall have the meaning set forth in the preamble.
(x) “Company
Contracts” shall have the meaning set forth in Section 2.13(a).
(y) “Company
Financials” shall have the meaning set forth in Section 2.5.
(z) “Confidential
Information” shall have the meaning set forth in Section 5.4.
(aa) “Conflict”
shall have the meaning set forth in Section 2.4.
(bb) “Customer
Information” shall have the meaning set forth in Section 2.11(d).
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(cc) “Development
Costs” shall have the meaning set forth in Section 5.3.
(dd) “Disclosure
Supplement” shall have the meaning set forth in Section 5.10.
(ee) “Employee” means any current or former or retired
employee or consultant of either the Company or any ERISA Affiliate of the
Company whose responsibilities primarily relate, or related, as the case may
be, to the Company’s business.
(ff) “Employment
Agreement”
means each management, employment, severance, consulting, relocation,
repatriation, expatriation, visas, work permit or other agreement, contract or
understanding between the Company or any ERISA Affiliate of the Company and any
Employee relating, directly or indirectly, to such Employee’s terms and
condition of employment.
(gg) “Environmental
Laws” shall mean any and all applicable laws, statutes, ordinances, rules,
codes, orders, decrees, directives, guidelines and regulations which prohibit,
regulate or control any Hazardous Material or relate in any way to pollution,
the environment, or the protection of human health and worker safety, or
natural and cultural resources, and all amendments and modifications of any of
the foregoing.
(hh) “Environmental
Remediation Costs” shall mean any
liability, obligation, judgment, claim, penalty, fine, cost or expense
(including reasonable attorneys’ fees and environmental consultant costs of any
kind or nature) or the duty to indemnify, defend, or reimburse any Person with
respect to Remedial Activities which are necessary or required to both (i)
comply with and fulfill Environmental Laws existing as of the Closing Date
(including without limitation any orders of any Governmental Entity and any
consent decree, consent agreement or memorandum of understanding with
Governmental Entities), and (ii) remediate and/or remove Hazardous Materials to
a level compliant with Applicable Levels of Regulatory Concern. Such Remedial Activities shall, at a
minimum, be those Remedial Activities necessary to insure that the affected
property is not encumbered by any use or deed restriction (1) which is more
restrictive than any current use or deed restriction of any kind affecting the
Property or (2) which would materially affect the development of the Project.
(ii) “Equipment”
shall have the meaning set forth in Section 2.11(c).
(jj) “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.
(kk) “ERISA Affiliate” means any other
person or entity under common control with the Company within the meaning of
Section 414(b), (c), (m) or (o) of the Code and the regulations issued
thereunder.
(ll) “Expiration
Date” shall have the meaning set forth in Section 5.1(a).
(mm) “GAAP”
shall have the meaning set forth in Section 2.5.
(nn) “Governmental
Authorizations” shall mean each consent, license, permit, grant or other
authorization issued to the Company by a Governmental Entity (i) pursuant to
which
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the
Company currently operates or holds any interest in any of its properties, or
(ii) which is required for the operation of its business or the holding of any
such interest.
(oo) “Governmental
Entity” shall have the meaning set forth in Section 2.4.
(pp) “Guaranty” shall have the meaning set forth in the
recitals.
(qq) “Hazardous
Material” shall mean any material or substance that is prohibited or
regulated by any Environmental Law or that has been designated by any
Governmental Entity to be radioactive, toxic, hazardous, a pollutant, or
otherwise a danger to health, safety, reproduction or the environment other
than (1) products containing such materials used for janitorial or office
purposes properly and safely used and maintained and (2) building materials or
products used in improving or maintaining the Property containing such
materials and properly and safely used in compliance with Environmental Laws.
(rr) “Improvements”
shall mean all improvements, structures and fixtures located on the Land.
(ss) “Indemnified
Party” shall have the meaning set forth in Section 7.2
(tt) “Indemnification
Cap” shall mean $10,000,000, provided that upon the sale of the Property,
the Indemnification Cap shall be reduced by the lesser of (i) $1,000,000 and
(ii) twenty-five percent (25%) of the Net Profit.
(uu) “Inspection
Period” shall have the meaning set forth in Section 5.11.
(vv) “Intellectual
Property” shall have the meaning set forth in Section 2.12(a).
(ww) “Intercompany
Payables” shall mean any amount owed by the Company to any of ORA, The
Robert A. Schoellhorn Trust, Robert A. Schoellhorn and E. Randall Henderson or
any affiliates of such parties other than the amounts owed pursuant to the
Schoellhorn Loan.
(xx) “Intercompany
Receivables” shall mean any amount owed to the Company by any of ORA, The
Robert A. Schoellhorn Trust, Robert A. Schoellhorn and E. Randall Henderson or
any affiliates of such parties.
(yy) “Interim
Balance Sheet” shall have the meaning set forth in Section 2.5.
(zz) “Interim
Financials” shall have the meaning set forth in Section 2.5.
(aaa) “knowledge”
“to the knowledge of” “aware of” and words or phrases of similar
effect with reference to the Company and/or ORA shall mean the knowledge, after
due inquiry, of the officers, directors and managerial employees of the Company
and ORA and any direct or indirect subsidiary of ORA and shall include the
knowledge of Robert A. Schoellhorn, E. Randall Henderson, Ronald W. Petty and
Orien Dickerson.
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(bbb) “Land”
shall mean all that certain approximately 93 acre tract or parcel of land
located in Naples, Florida, and more particularly described on Exhibit C
attached hereto.
(ccc) “Liens”
shall have the meaning set forth in Section 2.9(b)(vii).
(ddd) “Losses”
shall have the meaning set forth in Section 7.2(a).
(eee) “Material
Adverse Effect” shall have the meaning set forth in Section 2.1.
(fff) “Mitigation
Agreement” shall mean that certain agreement between the Company and
Southwest Florida Wetlands J.V. relating to wetlands mitigation with respect to
the Property.
(ggg) “Monaco”
shall have the meaning set forth in the preamble.
(hhh) “Monaco Loan”
shall mean that certain loan from Monaco to the Company in the amount of $2.325
million pursuant to a Loan Agreement dated July 27, 2001 and secured by a
mortgage dated September 26, 2001 on the Land and Improvements.
(iii) “Mortgages”
shall have the meaning set forth in Section 2.26(i).
(jjj) “Net
Profit” shall have the meaning set forth in Section 9.1(b).
(kkk) “Officer’s
Certificate” shall have the meaning set forth in Section 7.2(c)(i).
(lll) “ORA”
shall have the meaning set forth in the preamble.
(mmm) “ORA Annual
Financials” shall have the meaning set forth in Section 2.6.
(nnn) “ORA’s and
Company’s Unknown Environmental Liabilities” shall mean the presence of any
Hazardous Material in the soil, groundwater, surface water, air or building
materials of any real property owned or leased by the Company at any time which
(1) are not present as a result of the actions or omissions of the Company, the
Principals or ORA or (2) were not known to the Company, the Principals or ORA
as of the Closing Date.
(ooo) “ORA
Financials” shall have the meaning set forth in Section 2.6.
(ppp) “ORA Interim
Financials” shall have the meaning set forth in Section 2.6.
(qqq) “ORLV”
shall have the meaning set forth in the recitals.
(rrr) “ORLV
Acquisition” shall have the meaning set forth in the recitals.
(sss) “ORLV
Agreement” shall have the meaning set forth in the recitals.
(ttt) “ORMCC”
shall have the meaning set forth in the recitals.
(uuu) “ORMCC
Acquisition” shall have the meaning set forth in the recitals.
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(vvv) “ORMCC
Agreement” shall have the meaning set forth in the recitals.
(www) “Permitted Exceptions” shall mean those
title exceptions set forth in Schedule 1.3(www).
(xxx) “Person”
shall mean an individual, a partnership, a limited liability company, a
corporation, an association, a joint stock corporation, a trust, a joint
venture, an unincorporated organization, or a Governmental Entity.
(yyy) “Personalty”
shall mean all tangible personal property and all intangible property used or
usable in connection with the Land, the Improvements or the tangible personal
property, or any part thereof, or the construction or operation thereof or in
connection with the use thereof; including, without limitation, all electrical,
mechanical, structural, heating, ventilation, air conditioning and other
equipment and operating systems, any and all agreements, contract rights,
guaranties, warranties (including, but not limited to, those relating to
construction, fabrication and environmental condition), utility contracts and
rights, plans and specifications, governmental approvals, permits, land use and
development rights, easements and building materials.
(zzz) “Plans”
means any plan, program, policy, practice, contract, Employment Agreement or
other arrangement providing for compensation, severance, termination pay,
pension benefits, retirement benefits, deferred compensation, performance
awards, stock or stock-related awards, fringe benefits (including health,
dental, vision, life, disability, sabbatical, accidental death and
dismemberment benefits), or other employee benefits or remuneration of any
kind, whether written, unwritten or otherwise, funded or unfunded, including,
without limitation, each “employee benefit plan,” within the meaning of Section 3(3)
of ERISA, which is or has been maintained, sponsored by, contributed to, or
required to be contributed to, by the Company for the benefit of any Employee,
or with respect to which the Company has or may have any liability or
obligation to any Employee.
(aaaa) “Plans and
Specifications” shall have the meaning set forth in Section 2.26(r).
(bbbb) “Principals”
shall mean Robert A. Schoellhorn, E. Randall Henderson, and the Robert A.
Schoellhorn Trust.
(cccc) “Project”
shall mean that certain motor coach resort to be constructed and operated on
the Property, consisting of a clubhouse, a maintenance building, a sales
office/administration building, 5 swimming pools, 4 tennis courts, a nine-hole
pitch and putt golf course, 5 lakes and 399 lots, including motor coach pads
and utility connections thereto, to be sold to third party users.
(dddd) “Property”
shall mean the Land, Improvements and Personalty.
(eeee) “Remedial
Activities” shall mean any activities related to investigating, removing,
remediating, treating, transporting, disposing, characterizing, sampling,
monitoring, encapsulating or assessing Hazardous Materials (including, without
limitation, any assessment of health or environmental risks posed by Hazardous
Materials).
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(ffff) “Replacement
Loan” shall mean that certain loan or loans that Monaco intends to secure
to pay off the BankAtlantic Loan and/or to finance the Property.
(gggg) “Returns” shall
have the meaning set forth in Section 2.9(b)(i).
(hhhh) “Resale” shall
have the meaning set forth in Section 9.1(a).
(iiii) “Resale
Closing Date” shall have the meaning set forth in Section 9.1(b).
(jjjj) “Schoellhorn
Loan” shall mean the loan made by The Robert A. Schoellhorn Trust to the
Company in the amount set forth on Schedule 9.1(c).
(kkkk) “Sellers’
Disclosure Letter” shall mean the disclosure letter delivered by ORA to
Monaco concurrently with the execution and delivery of this Agreement.
(llll) “SFWMD
Permits” shall mean the permits issued by the South Florida Water
Management District, including, without limitation, Permit Nos. 11-02092-W and
11-02081-P.
(mmmm) “Shares” shall have the
meaning set forth in the recitals.
(nnnn) “Supplemental
Disclosure Election” shall have the meaning set forth in Section 5.10.
(oooo) “Tax” shall
have the meaning set forth in Section 2.9(a).
(pppp) “Title Policy”
shall have the meaning set forth in Section 6.3(n).
1.4 Acquisition Consideration. As
consideration for the purchase of the Shares, Monaco and Buyer shall take the
following actions:
(a) Satisfaction
of BankAtlantic Loan. At the
Closing, Monaco shall pay or cause to be paid to BankAtlantic the entire
outstanding principal and interest under the BankAtlantic Loan.
(b) Affiliates
Agreement. Monaco will release ORA
and the Principals from certain liabilities as set forth in the Affiliates
Agreement.
(c) Profits
from Resale of the Property. Buyer
shall pay the amounts, if any, which may become due pursuant to Section 9.1
hereof.
1.5 Transfer of Certificates and
Agreements. At the Closing, ORA shall deliver to
Buyer (i) stock certificates representing the Shares duly endorsed or
accompanied by stock powers duly endorsed in blank, with any required transfer
stamps affixed thereto, and (ii) all other documents, agreements, certificates,
instruments or writings required to be delivered by the Company or ORA on or
prior to the Closing Date pursuant to this Agreement. The Company shall transfer on its books all shares sold pursuant
to this Agreement.
1.6 Lost, Stolen or Destroyed
Certificates. In the event any certificates
evidencing the Shares shall have been lost, stolen or destroyed, ORA shall make
an affidavit of that fact, and shall
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deliver to Monaco at Closing (i) such affidavit and (ii) an agreement
(in form and substance satisfactory to Monaco) to indemnify Monaco against any
claim that may be made against Monaco with respect to the certificates alleged
to have been lost, stolen or destroyed.
1.7 Tax. Buyer shall bear and pay
any transfer taxes, documentation charges, recording fees or similar charges,
fees or expenses that may become payable in connection with the sale of the
Shares, provided that Buyer shall not be responsible for ORA’s income taxes
resulting from the sale of the Shares, which taxes shall be borne by ORA.
1.8 Taking of Necessary Action; Further
Action. At
any time, and from time to time on or after the Closing, at the reasonable
request of Monaco and without further consideration, ORA and the Company will
execute and deliver those other instruments of sale, transfer, conveyance,
assignment and confirmation and take such action as Monaco may reasonably
determine is necessary to transfer, convey and assign to Buyer, and to confirm
Buyer’s title to or interest in the Shares, to put Buyer in actual possession
and operating control of the Company and to assist Buyer in exercising all
rights with respect thereto and to otherwise carry out the purposes of this
Agreement including without limitation assigning to the Company any contracts,
rights or warranties relating to the Property that are in the name of ORA or
other affiliates of ORA. If, at any
time after the Closing, any such further action is necessary or desirable to carry
out the purposes of this Agreement, Monaco, Buyer, ORA, the Company and the
officers and directors of the Company and the Buyer are fully authorized in the
name of their respective companies or otherwise to take, and will take, all
such lawful and necessary action, so long as such action is consistent with
this Agreement.
1.9 Interpretation and Construction.
(a) All references in this Agreement to “Articles,”
“Sections,” “Schedules” and “Exhibits” refer to the
articles, sections, schedules and exhibits of this Agreement, unless otherwise
indicated.
(b) As
used in this Agreement, neutral pronouns and any variations thereof shall be
deemed to include the feminine and masculine and all terms used in the singular
shall be deemed to include the plural, and vice versa, as the context may
require.
(c) The
words “hereof,” “herein” and “hereunder” and other words
of similar import refer to this Agreement as a whole, as the same may from time
to time be amended or supplemented, and not to any subdivision contained in
this Agreement.
(d) The
word “including” when used herein is not intended to be exclusive and
means “including, without limitation.”
(e) The
parties agree that they have been represented by counsel during the negotiation
and execution of this Agreement and, therefore, waive the application of any
law, regulation, holding or rule of construction providing that ambiguities in
an agreement or other document will be construed against the party drafting
such agreement or document.
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ORA represents and warrants to Monaco and Buyer,
subject to such exceptions as are specifically disclosed in the Sellers’
Disclosure Letter, as follows:
2.1 Organization of the Company.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Florida. The Company has the corporate power to own its properties and to
carry on its business as now being conducted.
The Company is duly qualified to do business and in good standing as a
foreign corporation in each jurisdiction in which the failure to be so
qualified would have a material adverse effect on the business, assets
(including intangible assets), financial condition or results of operations of
the Company (hereinafter referred to as a “Material Adverse Effect”). The Company has delivered a true and correct
copy of its Articles of Incorporation and Bylaws, each as amended and in full
force and effect to date, to Monaco. Schedule
2.1 lists the directors and officers of the Company.
2.2 Company Capital Structure.
(a) The
authorized capital stock of the Company consists of 1000 shares of Class A
Common Stock, $1.00 par value per share, of which 100 shares are issued and
outstanding, and 1000 shares of Series B Preferred Stock, no par value per
share, of which no shares are issued and outstanding. All outstanding shares of the capital stock of the Company are
duly authorized, validly issued, fully paid and non-assessable and not subject
to preemptive rights created by statute, the Articles of Incorporation or
Bylaws of the Company or any agreement to which the Company is a party or by
which it is bound and have been issued in compliance with federal and state
securities laws. There are no declared
or accrued but unpaid dividends with respect to any shares of the Company’s
capital stock. Schedule 2.2(a)
sets forth any restrictions as to the vesting of any of the Company’s capital
stock, including the number of shares subject to restriction, the holder
thereof and the material terms of any such agreement.
(b) ORA
is and will be until immediately prior to the Closing the record and beneficial
owner and holder of the Shares, free and clear of any charge, claim, community
property interest, condition, equitable interest, lien, option, pledge,
security interest, right of first refusal, or restriction of any kind,
including any restriction on use, voting, transfer, receipt of income, or
exercise of any other attribute of ownership.
The Shares constitute and will constitute on the Closing Date, all the
outstanding capital stock of the Company. As a result of the Acquisition, Buyer
will be the sole record and beneficial owner of all outstanding capital stock
of the Company.
(c) There
are no options, warrants, calls, rights, commitments or agreements of any
character, written or oral, to which the Company is a party or by which it is
bound obligating the Company to issue, deliver, sell, repurchase or redeem, or
cause to be issued, delivered, sold, repurchased or redeemed, any shares of the
capital stock of the Company or obligating the Company to grant or enter into
any such option, warrant, call, right, commitment or agreement. Except as contemplated by this Agreement,
there is no rights agreement, voting trust, proxy or other agreement
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or
understanding to which the Company is a party or by which it is bound with
respect to any security of any class of the Company.
2.3 Subsidiaries. The Company does
not have and has never had any subsidiaries or affiliated companies and does
not otherwise own and has never otherwise owned any shares of capital stock or
any interest in, or control, directly or indirectly, any other corporation,
partnership, association, joint venture or other business entity.
2.4 Authority. The
Company and ORA have all requisite power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on the part of the Company and
ORA. This Agreement has been duly
executed and delivered by the Company and ORA and constitutes the valid and
binding obligation of the Company and ORA, enforceable in accordance with its
terms except as such enforceability may be limited by principles of public
policy and subject to the laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will conflict
with, or result in any violation of, or default under (with or without notice
or lapse of time, or both), or give rise to a right of termination,
cancellation or acceleration of any obligation or loss of any benefit under
(any such event, a “Conflict”) (i) any provision of the
Articles of Incorporation or Bylaws of the Company, or (ii) any mortgage,
indenture, lease, contract or other agreement or instrument, permit, Approval,
concession, franchise, license, warranty, insurance policy, judgment, order,
decree, statute, law, ordinance, rule or regulation applicable to the Company
and/or ORA or their respective properties or assets. No consent, waiver, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency or
commission or other federal, state, county, local or foreign governmental
authority, instrumentality, agency or Commission (“Governmental Entity”) or any
third party (so as not to trigger any Conflict), is required by or with respect
to the Company and/or ORA in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.
2.5 Company Financial Statements.
Schedule 2.5 sets forth the Company’s audited balance sheet as of
March 31, 2002 and the related audited statements of income and cash flow for
the twelve-month period then ended (collectively the “Annual Financials”), and the
Company’s unaudited balance sheet as of September 30, 2002 and the related
unaudited statements of income and cash flow for the six-month period then
ended (collectively the “Interim Financials”) (the Annual
Financials and the Interim Financials collectively the “Company Financials”). The Company Financials are (a) true and
correct in all material respects, (b) present fairly the financial condition
and operating results of the Company as of the dates and during the periods
indicated therein, (c) are derived from and consistent with the Company’s books
and records, and (d) are prepared in accordance with generally accepted
accounting principles (“GAAP”)
applied on a basis consistent throughout the periods indicated and consistent
with each other (except that the Interim Financials need not contain the
footnotes required by GAAP and are subject to normal year-end adjustments,
which will not be material in amount or significance in the aggregate). Schedule 2.5 also sets forth a true,
complete and accurate list of the Company’s accounts payable as of November 26,
2002.
11
The Company’s balance sheet as of September 30, 2002 may be referred to
hereinafter as the “Interim Balance Sheet.”
2.6 ORA Financial Statements. Schedule 2.6 sets forth
ORA’s audited balance sheet as of March 31, 2002 and the related audited
statements of income and cash flow for the twelve-month period then ended
(collectively the “ORA Annual Financials”), and ORA’s
unaudited balance sheet as of September 30, 2002 and the related unaudited
statements of income and cash flow for the six-month period then ended
(collectively the “ORA Interim Financials”) (the ORA Annual
Financials and the ORA Interim Financials collectively the “ORA Financials”). The ORA Financials are (a) true and correct
in all material respects, (b) present fairly the financial condition and
operating results of ORA as of the dates and during the periods indicated
therein, (c) are derived from and consistent with ORA’s books and records, and
(d) are prepared in accordance with GAAP on a basis consistent throughout the
periods indicated and consistent with each other (except that the ORA Interim
Financials need not contain the footnotes required by GAAP and are subject to
normal year end audit adjustments which are not material in amount).
2.7 No Undisclosed Liabilities.
The Company does not have any liability, indebtedness, obligation, expense,
claim, deficiency, guaranty or endorsement of any type, whether accrued,
absolute, contingent, matured, unmatured or other (whether or not required to
be reflected in financial statements in accordance with GAAP), which,
individually or in the aggregate, (i) has not been reflected in the Company
Financials, or (ii) has arisen since the date of the Interim Financials outside
the ordinary course of the Company’s business.
2.8 No Changes. Except as
contemplated by this Agreement, since the date of the Interim Balance Sheet,
there has not been, occurred or arisen any:
(a) transaction
by the Company except in the ordinary course of business as conducted on the
date of the Interim Balance Sheet and consistent with past practices;
(b) amendments
or changes to the Articles of Incorporation or Bylaws of the Company;
(c) expenditure
or commitment by the Company in excess of $10,000 individually or $50,000 in
the aggregate;
(d) destruction
of, damage to or loss of any material assets, business or customer of the
Company (whether or not covered by insurance), including the Property;
(e) change
in accounting methods or practices (including any change in depreciation or
amortization policies or rates) by the Company;
(f) revaluation
by the Company of any of its assets, including the Property;
(g) declaration,
setting aside or payment of a dividend or other distribution with respect to
the capital stock of the Company;
12
(h) material
change in any compensation arrangement or agreement with any employee, officer,
director or stockholder;
(i) acquisition,
sale, lease, license or other disposition of any of the assets of the Company,
or any creation of any security interest in such assets or properties,
including the Property;
(j) amendment
or termination of any material contract, agreement, permit, approval or license
to which the Company is a party or by which it is bound, including any purchase
and sale agreements for lots in the Project;
(k) loan
by the Company to any Person, incurring by the Company of any indebtedness,
guaranteeing by the Company of any indebtedness, issuance or sale of any debt
securities of the Company or guaranteeing by the Company of any debt securities
of others;
(l) waiver
or release of any right or claim of the Company, including any write-off or
other compromise of any account receivable of the Company;
(m) commencement
or notice or threat of commencement of any lawsuit or judicial or
administrative proceeding against or investigation of the Company or its
affairs, including the Project;
(n) any
event or condition of any character that has or could be reasonably expected to
have a material adverse impact on the Company;
(o) any
agreement, contract, lease or commitment or any extension or modification of
the terms of any agreement, contract, lease or commitment which (i) involves
the payment of greater than $25,000 per annum, (ii) extends for more than one
(1) year, (iii) involves any payment or obligation to any affiliate of the
Company other than in the ordinary course of business as conducted on that date
and consistent with past practices, or (iv) involves the sale of, lease of or
transfer of any interest in any material assets;
(p) hiring
of, or offer of employment to, any employees (or if an offer was accepted
people that would become employees); or
(q) negotiation
or agreement by the Company or any officer or employees thereof to do any of
the things described in the preceding clauses (a) through (p) (other than
negotiations with Monaco or Buyer and their representatives regarding the
transactions contemplated by this Agreement).
2.9 Tax and Other Returns and Reports.
(a) Definition
of Taxes. For the purposes of this
Agreement, “Tax” or, collectively, “Taxes”, means (i) any and all federal,
state, local and foreign taxes, assessments and other governmental charges,
duties, impositions and liabilities, including taxes based upon or measured by
gross receipts, income, profits, sales, use and occupation, and value added, ad
valorem, transfer, franchise, withholding, payroll, recapture, employment,
excise and property taxes, together
13
with all interest, penalties and additions imposed
with respect to such amounts and any obligations under any agreements or
arrangements with any other Person with respect to such amounts, (ii) any
liability for the payment of any amounts of the type described in clause (i) of
this Section 2.9(a) as a result of being a member of an affiliated,
consolidated, combined or unitary group for any period, and (iii) any liability
for the payment of any amounts of the type described in clauses (i) or (ii) of
this Section 2.9(a) as a result of any express or implied
obligation to indemnify any other Person or as a result of and including any
liability for taxes of a predecessor entity.
(b) Tax
Returns and Audits.
(i) The
Company has prepared and timely filed all required federal, state, local and
foreign returns, estimates, information statements and reports (“Returns”)
relating to any and all Taxes concerning or attributable to the Company or its
operations and such Returns are true and correct and have been completed in
accordance with applicable law.
(ii) The
Company: (A) has timely paid all Taxes
it is required to pay and (B) has withheld with respect to its employees (and
timely paid over to the appropriate taxing authority) all federal and state
income taxes, Federal Insurance Contribution Act, Federal Unemployment Tax Act
and other Taxes required to be withheld.
(iii) The
Company has not been delinquent in the payment of any Tax nor is there any Tax
deficiency outstanding, proposed or assessed against the Company, nor has the
Company executed any waiver of any statute of limitations on or extending the
period for the assessment or collection of any Tax.
(iv) No
audit or other examination of any Return of the Company is presently in
progress, nor has the Company been notified of any request for such an audit or
other examination.
(v) The
Company does not have any liabilities for unpaid federal, state, local and
foreign Taxes which have not been accrued or reserved against on the Company
Financials, whether asserted or unasserted, contingent or otherwise, and the
Company and/or ORA have no knowledge of any basis for the assertion of any such
liability attributable to the Company or its assets or operations. Since the date of the Interim Balance Sheet,
the Company has not incurred any liability for Taxes other than in the ordinary
course of business.
(vi) The
Company has provided to Monaco or its legal counsel copies of all federal and
state income and all state sales and use Tax Returns filed by the Company for
all periods since inception.
(vii) There
are (and as of immediately following the Closing there will be) no liens,
pledges, charges, claims, security interests or other encumbrances of any sort
(“Liens”)
on the assets of the Company relating to or attributable to Taxes other than
Permitted Exceptions and the lien of ad valorem real estate taxes which are not
delinquent as of the Closing Date.
(viii) Neither
the Company nor ORA has any knowledge of any basis for the assertion of any
claim relating or attributable to Taxes which, if adversely determined, would
result
14
in any
Lien on the assets of the Company other than Permitted Exceptions and the lien
of ad valorem real estate taxes which are not delinquent as of the Closing Date.
(ix) None
of the Company’s assets are treated as “tax-exempt use property” within the
meaning of Section 168(h) of the Code.
(x) No
adjustment relating to any Tax Return filed by the Company has been proposed
formally or, to the knowledge of the Company or ORA, informally by any taxing
authority to the Company or any representative thereof.
(xi) The
Company has not filed any consent agreement under Section 341(f) of the Code or
agreed to have Section 341(f)(2) of the Code apply to any disposition of a
subsection (f) asset (as defined in Section 341(f)(4) of the Code) owned by the
Company.
(xii) The
Company has (a) never been a member of an
affiliated group (within the meaning of Code §1504(a)) filing a consolidated
federal income Tax Return (other than a group the common parent of which was
ORA), (b) never been a party to a Tax sharing, indemnification or
allocation agreement nor does the Company owe any amount under any such
agreement, (c) no liability for the Taxes
of any Person (other than the Company) under Treas. Reg. § 1.1502-6 (or any
similar provision of state, local or foreign law), as a transferee or
successor, by contract, or otherwise and (d) never been a party to any joint
venture, partnership or other agreement that could be treated as a partnership
for Tax purposes.
(xiii) The
Company is not, nor has at any time been, a “United States real property
holding corporation” within the meaning of Section 897(c)(2) of the Code.
(xiv) The
Company’s tax basis in its assets is accurately reflected on the Company’s tax
books and records and will not be affected by any transactions contemplated by
this Agreement.
(xv) The Company has not constituted either a
“distributing corporation” or a “controlled corporation” in a distribution of
stock qualifying for tax-free treatment under Section 355 of the Code (x) in
the two (2) years prior to the date of this Agreement or (y) in a distribution
which could otherwise constitute part of a “plan” or “series of related
transactions” (within the meaning of Section 355(e) of the Code) in conjunction
with the Acquisition.
(c) Executive
Compensation Tax. There is no
contract, agreement, plan or arrangement to which the Company is a party,
including the provisions of this Agreement, covering any employee or former employee
of the Company, which individually or collectively, could give rise to the
payment of any amount that would not be deductible pursuant to Sections 280G,
404 or 162(m) of the Code.
2.10 Restrictions on Business Activities.
There is no agreement (noncompete or otherwise), commitment, judgment,
injunction, order or decree to which the Company is a party or otherwise
binding upon the Company which has or reasonably could be expected to have the
effect of prohibiting or impairing any business practice of the Company, any
acquisition of property
15
(tangible or intangible) by the Company or the conduct of business by
the Company, including the completion or operation of the Project.
2.11 Title of Properties; Absence of Liens and
Encumbrances; Condition of Equipment.
(a) Except
for the Property, the Company does not own, lease, license, sublease or
otherwise occupy any real property, nor has it ever owned, leased, licensed,
subleased or otherwise occupied any real property.
(b) The
Company has good and valid title to, or, in the case of leased properties and
assets, valid leasehold interests in, all of their tangible properties and
assets, real, personal and mixed, used or held for use in its business, free
and clear of any Liens (as defined in Section 2.9(b)(vii)), except
(i) as reflected in the Company Financials, (ii) the lien of ad valorem real
estate taxes which are not delinquent as of the Closing Date, (iii) liens for
other taxes not yet due and payable and (iv) such imperfections of title and
encumbrances, if any, which are not material in character, amount or extent,
and which do not materially detract from the value, or materially interfere
with the present use, of the property subject thereto or affected thereby.
(c) Schedule 2.11(c)
identifies all material items of equipment, machinery, furniture, fixtures and
tangible personal property owned or leased by the Company for use in the
business of the Company (collectively, the “Equipment”)
and identifies if any such items are subject to any lien or encumbrance. The Equipment set forth on Schedule 2.11(c)
is all the equipment, machinery, furniture, fixtures and tangible personal
property used by the Company in the operation of its business.
(d) The
Company has sole and exclusive ownership, free and clear of any Liens, of all
customer lists, customer contact information, customer correspondence and
customer licensing and purchasing histories relating to its current and former
customers (the “Customer Information”).
No Person other than the Company possesses any claims or rights with
respect to use of the Customer Information.
2.12 Intellectual Property.
(a) Status. Set forth in Schedule 2.12 is a
list and brief description of all trademarks, trademark applications, service
marks, service mark applications and trade names, and all applications for such
which are in the process of being prepared, owned by or registered in the name
of the Company, or of which the Company is a licensor or licensee or in which
the Company has any right, and in each case a brief description of the nature
of such right (the “Intellectual Property”).
(b) Ownership. Neither the Company nor ORA has any
knowledge of any conflict with or infringement of the rights of others with
respect to the Intellectual Property.
There are no outstanding options, licenses, or agreements of any kind
relating to the Intellectual Property, nor is the Company bound by or a party
to any options, licenses or agreements of any kind with respect to the
trademarks, service marks and trade names of any other Person.
16
(c) Infringement. The Company has not received any
communications alleging that the Company has violated or, by conducting its business
as proposed, would violate any of the trademarks, service marks and trade names
of any other Person. Neither the
Company nor ORA is aware of any action, suit, proceeding or investigation
pending or currently threatened against the Company which relate to the
Company’s ownership of the Intellectual Property that may, to the Company’ or
ORA’s knowledge, materially and adversely affect the Company’s business as now
conducted, nor are the Company or ORA aware that there is any basis for the
foregoing.
2.13 Agreements, Contracts and Commitments.
(a) Set
forth in Schedule 2.13(a) is a list of all agreements, contracts,
leases, licenses or commitments (a) under which the Company has or may acquire
any rights, (b) under which the Company has or may become subject to any
obligation or liability, or (c) by which the Company or any of the assets owned
or used by it is or may become bound (collectively, the “Company Contracts”), including any of the
following:
(i) any
agreements or arrangements that contain any severance pay or post-employment
liabilities or obligations,
(ii) any
bonus, deferred compensation, pension, profit sharing or retirement plans, or
any other employee benefit plans or arrangements,
(iii) any
employment or consulting agreement, contract or commitment with an employee or
individual consultant or salesperson or consulting or sales agreement, contract
or commitment with a firm or other organization,
(iv) any
fidelity or surety bond or completion bond,
(v) any
lease of personal property,
(vi) any
agreement of indemnification or guaranty,
(vii) any
agreement, contract or commitment containing any covenant limiting the freedom
of the Company to engage in any line of business or to compete with any Person,
(viii) any
agreement, contract or commitment relating to capital expenditures,
(ix) any
agreement, contract or commitment relating to the disposition or acquisition of
assets or any interest in any business enterprise outside the ordinary course
of the Company’s business,
(x) any
mortgages, indentures, loans or credit agreements, security agreements or other
agreements or instruments relating to the borrowing of money or extension of
credit, including guaranties referred to in clause (vi) hereof,
17
(xi) any
purchase order or contract for the purchase of raw materials,
(xii) any
construction contracts,
(xiii) any
distribution, joint marketing or development agreement, or
(xiv) any other
agreement, contract or commitment that is not cancelable without penalty within
thirty (30) days.
(b) The
Company has not breached, violated or defaulted under, or received notice that
it has breached, violated or defaulted under, any of the terms or conditions of
any Company Contract. Each Company
Contract is in full force and effect and is not subject to any default
thereunder of which the Company or ORA have knowledge by any party obligated to
the Company pursuant thereto.
(c) No
consents, waivers and approvals of parties to any Company Contract are necessary
in order to avoid any breach, violation, default, acceleration or termination
right or other loss of rights or event that would constitute a breach,
violation, default, acceleration or termination right or other loss of rights
with the lapse of time, giving of notice, or both, in connection with the
execution and delivery of this Agreement and the consummation of transactions
contemplated hereby.
(d) The
Company has delivered to Monaco true, correct and complete copies of the
Company Contracts, including all exhibits, amendments and supplements and all
material correspondence related thereto.
No party to any Company Contract has informed the Company of its
intention to terminate or not renew such Company Contract. No issue has been raised by any party out of
the ordinary course of business, if unresolved, would result in the termination
or nonrenewal of such Company Contract.
Following the Closing, the Company will be permitted to exercise all of
the rights that the Company had under the Company Contracts prior to the
Closing without payment of any additional amounts or consideration other than
ongoing fees or payments which the Company would otherwise be required to pay
pursuant to the terms of such Company Contract had the transactions contemplated
by this Agreement not occurred.
2.14 Interested Party Transactions.
(a) Other
than by virtue of its interest in ORA, no officer, director or shareholder of
the Company or, to the knowledge of the Company or ORA, nor any ancestor,
sibling, descendant or spouse of any of such Persons, or any trust, partnership
or corporation in which any of such Persons has an interest, has, directly or
indirectly, (i) an interest in any entity which furnished or sold, or furnishes
or sells, services or products that the Company furnishes or sells or proposes
to furnish or sell, or (ii) an interest in any entity that purchases from or
sells or furnishes to the Company any goods or services, or (iii) a beneficial
interest in any Company Contract; provided, that ownership of no more than one
percent (1%) of the outstanding voting stock of a publicly traded corporation
shall not be deemed an “interest in any entity” for purposes of this Section 2.14.
(b) Schedule 2.14(b)
accurately lists and describes each Intercompany Receivable and each
Intercompany Payable.
18
2.15 Governmental Authorization.
(a) Schedule 2.15
accurately lists each Governmental Authorization. The Governmental
Authorizations are in full force and effect and constitute all Governmental
Authorizations required to permit the Company to operate or conduct its
business substantially as it is currently and has been conducted or hold any
interest in its properties or assets.
(b) No
event has occurred or circumstance exists that may (with or without notice or
lapse of time) (i) constitute or result directly or indirectly in a material
violation of or a failure to comply with any term or requirement of any
Governmental Authorization listed or required to be listed on Schedule 2.15
or (ii) result directly or indirectly in the revocation, withdrawal,
suspension, cancellation or termination of, or any modification to, any
Governmental Authorization listed or required to be listed on Schedule 2.15.
(c) None
of the Company, ORA or the Principals have received any notice or other
communication (whether written or oral) from any Governmental Entity or any
other Person regarding (i) any actual, alleged, possible or potential violation
of or failure to comply with any term or requirement of any Governmental
Authorization or (ii) any actual, proposed, possible or potential revocation,
withdrawal, suspension, cancellation, termination of or modification to any
Governmental Authorization.
2.16 Litigation. Except
as set forth on Schedule 2.16, there is no action, suit, claim or
proceeding of any nature pending or threatened against the Company or its
properties, any of its officers or directors in their respective capacities as
such or the Project (other than litigation which has been filed but of which
the Company and ORA have no knowledge of and with respect to which have not
been served), nor, to the knowledge of the Company or ORA, is there any basis
therefor. There is no investigation
pending or threatened against the Company or its properties or any of its
officers or directors by or before any Governmental Entity, nor, to the
knowledge of the Company or ORA, is there any basis therefor. Schedule 2.16 sets forth, with
respect to any pending or threatened action, suit, proceeding or investigation,
the forum, the parties thereto, the subject matter thereof and the amount of
damages claimed or other remedy requested.
No Governmental Entity has at any time challenged or questioned the legal
right of the Company to complete or operate the Project which remains
unresolved or which continues to be asserted.
There is no action, suit, claim or proceeding of any nature pending, or
overtly threatened, against the Company, or its properties or any of its
officers or directors, arising out of, or in any way connected with, the
execution and delivery of this Agreement or the other transactions contemplated
by the terms of this Agreement.
2.17 Accounts Receivable.
(a) The
Company has made available to Monaco a list of all accounts receivable of the
Company reflected on the Company Financials (“Accounts Receivable”) along
with a range of days elapsed since invoice.
(b) All
Accounts Receivable of the Company arose in the ordinary course of business,
are carried at values determined in accordance with GAAP consistently applied
and, to the best knowledge of the Company and ORA, should be collectible except
to the extent of reserves
19
therefor
set forth in the Company Financials. No
Person has any Lien on any of such Accounts Receivable and no request or
agreement for material deduction or discount has been made with respect to any
of such Accounts Receivable.
2.18 Minute Books. The minute books of the Company
made available to counsel for Buyer are the only minute books of the Company
and contain an accurate summary of all meetings of directors (or committees
thereof) and shareholders and actions by written consent of directors or
shareholders since the time of incorporation of the Company.
2.19 Environmental Matters.
No Hazardous Materials are present, as a result of actions or omissions of the
Company or ORA, or to the Company’s or ORA’s knowledge, as a result of any
actions or omissions of any third party or otherwise, in, on, or under any
property, including the land and the improvements, ground water and surface
water thereof, that the Company has at any time owned, operated, occupied or
leased. The Company has obtained, and is and has been in compliance in all
material respects with all applicable permits, licenses, registrations,
approvals and other authorizations that are required for the operation of the
Company’s business under all applicable Environmental Laws. The Company is and has been in compliance
with all applicable Environmental Laws and to the knowledge of the Company and
ORA, the Company’s agents, predecessors in interest, contractors, invitees or
licensees are and have been in compliance with all applicable Environmental
Laws in connection with the operation of the Company’s business and the
Project. The Company has not disposed
of, released, discharged, or emitted any Hazardous Materials into the air,
soil, groundwater or otherwise at any properties owned, leased or occupied at
any time by the Company, or at any other property, or exposed any employee or
other individual to any Hazardous Materials or any workplace or environmental
condition in such a manner as would reasonably be expected to subject the
Company to liability. Neither the
Company nor ORA is aware of any fact or circumstance, which could result in any
environmental liability which could reasonably be expected to result in a
Material Adverse Effect on the business or financial status of the Company. The
Company has delivered to Monaco or made available for inspection by Monaco and
its agents, representatives and employees all records in the Company’s
possession or reasonably available to the Company concerning the Company’s
compliance with Environmental Laws, and all environmental site assessments,
sampling, analyses, tests, audits and engineering data relating to any real
property currently or formerly owned or leased by the Company. The Company has
complied with all environmental disclosure obligations imposed by applicable
law with respect to this transaction.
2.20 Brokers’ and Finders’ Fees; Third Party Expenses.
The Company has not incurred, nor will it incur, directly or indirectly, any
liability for brokerage or finders’ fees or agents’ commissions or any similar
charges in connection with this Agreement or any transaction contemplated
hereby for which Monaco or Buyer could become liable or obligated.
2.21 Employee Matters and Benefit Plans.
(a) The
Company never has had any Employees, does not have any outstanding offers of
employment to any potential Employees, nor will it have any Employees at the
Closing. The Company is not party to or
bound by any currently effective Employment Agreements. The Company does not, nor has it ever had
the obligation to, maintain, establish, sponsor, participate in,
20
or contribute to any Plan
of the Company or any ERISA Affiliate of the Company, whether a Plan by
adoption by the Company or any ERISA Affiliate of the Company or by imposition
or application pursuant to applicable laws, rules and regulations of any
Governmental Entity, with respect to which the Company or any ERISA Affiliate
of the Company will or may have any liability or Benefits Liabilities for the
benefit of Employees.
(b) Neither
the Company nor any ERISA Affiliate of the Company has ever maintained,
established, sponsored, participated in, contributed to, or has been required
to contribute to any Pension Plan that is subject to Title IV of ERISA or
Section 412 or 413 of the Code.
(c) The
Company is not subject to any Benefits Liabilities and at the Closing, the
Company, Monaco and Buyer will not be subject to any Benefits Liabilities.
2.22 Insurance. Schedule 2.22
contains a true, correct and complete list of all insurance policies and bonds
covering the assets, business, equipment, properties, operations, employees,
officers and directors of the Company. There is no claim by the Company pending
under any of such policies or bonds as to which coverage has been questioned,
denied or disputed by the underwriters of such policies or bonds. All premiums due, payable and not yet
delinquent under all such policies and bonds have been paid and the Company is
otherwise in compliance with the terms of such policies and bonds (or other
policies and bonds providing substantially similar insurance coverage). The Company and ORA have no knowledge of any
threatened termination of, or material premium increase with respect to, any of
such policies.
2.23 Compliance with Laws.
The Company is in material compliance with all federal, state and local
statutes, laws or regulations, domestic or foreign, and has not received any
notices of violation with respect to any of such statutes, laws or regulations.
2.24 Consents. No consent, waiver,
approval, order or authorization of, or registration, declaration or filing
with, any Governmental Entity or any third party (so as not to trigger any
Conflict), is required by or with respect to the Company and/or ORA in
connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby or thereby.
2.25 No Injunctions or Restraints on
Conduct of Business. No temporary restraining order, preliminary
or permanent injunction or other order issued by any court of competent jurisdiction
or other legal or regulatory restraint or provision challenging Buyer’s
proposed acquisition of the Company, or limiting or restricting Buyer’s conduct
or operation of the business of the Company or against the Company or the
Property is in effect, nor, to ORA’s and the Company’s knowledge, has any
proceeding by an administrative agency or commission or other governmental
authority or instrumentality, domestic or foreign, seeking any of the foregoing
been overtly threatened or commenced.
2.26 Representations relating to the
Property.
(a) No
Condemnation Pending or Threatened.
There is no pending condemnation, environmental, zoning or other land
use regulatory proceeding affecting the Property
21
or the
completion and operation of the Project or any portion thereof, and neither the
Company nor ORA have any knowledge that any such action is currently
contemplated or threatened.
(b) Parties
in Possession. There are no parties
in possession of any portion of the Property, whether as lessees, tenants at
sufferance, trespassers or otherwise.
(c) Flood
Zone. No portion of the Property is
located in a wetland area, as defined by laws, or in a designated or recognized
flood plain, flood plain district, flood hazard area or area of similar
characterization. The Project will not
violate any requirement of the United States Corps of Engineers or laws
relating to wetland areas.
(d) Existing
Improvements. No Improvements
required for the completion and operation of the Project have been commenced,
including utility installations, and no construction, including grading, has
been performed.
(e) Hazardous
Substances.
(i) To
the knowledge of the Company and ORA (a) there are no surface impoundments,
lagoons, waste piles, injection wells, or underground storage areas, or other
man-made facilities located on the Property that may have accommodated
Hazardous Materials; (b) no portion of the Property has been used as a dump or
landfill or consists of filled-in land; (c) there are no buried, partially
buried, above-ground or other tanks, storage vessels, drums or containers
located on the Property; and (d) there has never been a spill, leak, discharge,
emission, escape, leaching or disposal of the contents of any underground
storage tank into groundwater, surface water or subsurface soils.
(ii) To
the knowledge of the Company and ORA, the Property currently complies with all
Environmental Laws, and the Company has received no warning, notice,
administrative complaint, judicial complaint or other formal or informal notice
alleging that any conditions on the Property are or may be in violation of any
Environmental Laws. The Company has not
received and, to the knowledge of the Company, and ORA, no previous owner of the
Property has received any notice, summons, citation, letter or other
communication, written or oral, from any Governmental Entity alleging or
inquiring into any possible release, emission, discharge, disposal, use,
storage, production, handling or presence of any Hazardous Materials on or
about the Property or the soil, surface water or groundwater thereof.
(iii) To
the knowledge of the Company and ORA, there are no wells on the Property and
the Project does not include installation of any wells for purposes of
irrigation or consumptive use and all water necessary for consumption and
irrigation for the Project as it is anticipated to be developed is currently
provided by a municipal water supply which extends to the Property boundary.
(f) Governmental
Approvals; No Violations of Zoning Laws.
Except as set forth on Schedule 2.26(f), to the knowledge of the
Company and ORA, the Company has obtained all licenses, permits, variances,
approvals, authorizations, easements and rights of way, including proof of
dedication, required from all Governmental Entities having jurisdiction over
the Property or from
22
private
parties, for the completion and operation of the Project, including, without
limitation, the sale of lots to third party users, and to insure vehicular and
pedestrian ingress to and egress from the Property and adequate parking on the
Property (“Approvals”). No action, proceeding, amendment procedure,
writ, injunction or claim is pending, or to the Company’s or ORA’s knowledge,
threatened concerning any such permit.
No land use, zoning, building or other law, ordinance, regulation or
restriction (including, without limitation, the Americans with Disabilities
Act) is, or as of the Closing Date will be, violated by the Property. The Improvements and all parts thereof do
not violate any restrictive covenants affecting it. Except as set forth on Schedule
2.26(f), there are no commitments to governmental authorities or agencies
or quasi-governmental entities which relate to land use or zoning affecting the
Property and there are no conditions of the Property’s zoning or use which have
not been completely fulfilled. To the
Company’s and ORA’s knowledge, there is no law, ordinance, order, regulation or
requirement now in existence or under active consideration by any government
agency or legislative body which would require the owner of the Property to
make any expenditure in excess of $1,000 to modify or improve the Property in
order to bring it into compliance therewith or to complete the Project. There is nothing that would constitute an
uncured material violation of Federal, state, or municipal laws, ordinances,
orders, regulations or requirements affecting any portion of the Property. Schedule 2.26(f) lists all Approvals
that have not yet been received or that require further performance by the
Company thereunder, the status of receipt of each Approval and/or the
performance by the Company thereunder, the steps required to receive or
complete performance with respect to each Approval, the estimated time required
to receive and/or complete required performance with respect to each Approval,
and any anticipated impediments to receiving and/or completing performance with
respect to each Approval.
(g) Access. The Property has adequate direct access to
and from completed, dedicated and accepted public roads and there is no pending
or threatened governmental proceeding which would impair or curtail such
access.
(h) Utilities. There are presently in existence no
telephone, telecommunication, water, sewer, gas and electrical lines and cables
and surface drainage systems on the Land.
All such utility, telecommunications and drainage systems that
are required to serve the Project are located in the right of way along
Immokalee Boulevard; however, the Company has not yet obtained permits for the
connection to such systems.
(i) Property. Except for the recorded mortgages/deeds of
trust securing the Monaco Loan and the BankAtlantic Loan, liens for ad valorem
real estate taxes not delinquent at the Closing Date, the Permitted Exceptions
and as set forth in Schedule 2.26(i), the Company is and, following
the consummation of the transaction contemplated by this Agreement will be, the
owner of good and marketable fee simple title to the Property free and clear of
any liens, mortgages, pledges, security interests, options, rights, leases,
charges, encumbrances or restrictions of any kind (“Mortgages”). Except as
set forth in Schedule 2.11(c), there is no personal property owned
by the Company which is used by the Company in connection with the ownership of
the Property other than the Personalty.
The Property is segregated on the applicable tax rolls, so that no other
property is included on any tax bill relating to any portion of the
Property. There are no tax exemptions
or abatements affecting any of the Property.
The Property as a whole can be conveyed to third party purchasers without
future action. Schedule 2.26(i)
lists all Mortgages to which the Property is subject (other than the recorded
mortgages/deeds of trust securing the BankAtlantic Loan and the
23
Monaco Loan), the parties in whose favor the Mortgages
run, the dates of such Mortgages, the amounts of such Mortgages and the subject
matter of such Mortgages.
(j) Leases;
Options; Broker Agreement. Other
than the A.R.M. Contract, except as set forth in Schedule 2.26(j),
there are no oral or written leases, licenses or other occupancy agreements,
pending purchase and sale agreements or parking agreements with respect to the
Property or options or rights of first refusal to lease or purchase the
Property. Schedule 2.26(j)
sets forth a list of all such agreements, the names of the parties thereto, the
dates thereof, the portions of the Property affected thereby (including the lot
number, if applicable) and (a) as to leases, licenses and other occupancy
agreements, the terms thereof and the aggregate rental and/or fees payable
thereunder and (b) as to purchase agreements, the purchase price, the amount of
the earnest money deposit, the estimated closing date and the conditions to
closing. The Company has delivered to
Monaco true, correct and complete copies of all such agreements, and such
agreements constitute the entire agreement with the Company thereunder. The Company and the other parties thereto do
not have any right to cancel or terminate any such agreements as a result of
any existing fact known to the Company.
The Company is not in default under any such agreements, and to the best
knowledge of the Company, and ORA, the other party thereto is not in default
under any such agreements, and has performed all of the obligations required to
be performed by the Company thereunder.
All such obligations to be performed on or prior to the Closing will
have been duly performed and paid for in full by the time of Closing. No brokerage or leasing commissions or other
compensation is due or payable to any Person with respect to any such
agreements or any extension, expansion or renewal thereof. No claims or litigation, actual or
threatened, exist with regard such agreements.
Neither the Company nor ORA nor any of the Principals has entered into
any broker agreements, listing agreements or other similar agreements with
respect to the sale or leasing of any portion of the Property.
(k) Service
Contracts. There are presently in
existence no service contracts, billboard or other advertising agreements or
other sorts of operating agreements with respect to the Property, other than
those listed on Schedule 2.26(k), all of which can be canceled,
without penalty or other payment, upon written notice of thirty (30) days or
less. There are no union contracts
affecting the Property. Schedule 2.26(k)
sets forth a list of all such agreements, the names of the parties thereto, the
dates thereof, the work covered thereby, the terms thereof and the aggregate
payments thereunder.
(l) Insurance. The Company carries commercial general
liability insurance with respect to the Property in the amount of $12,000,000.
(m) No
Assessments. To the Company’s and
ORA’s best knowledge, there are no pending or threatened assessments,
improvements or activities of any public or quasi-public body either planned,
in the process of construction or completed which may give rise to any
assessment against the Property or any portion thereof, including upon
completion of the Project.
(n) BankAtlantic
Loan. With respect to the
BankAtlantic Loan, (i) prepayment of such indebtedness is permitted at any
time without premium or penalty, (ii) the Company has provided Monaco true,
correct and complete copies of all of the documents securing and evidencing the
BankAtlantic Loan and none of such documents has been endorsed, renewed,
amended,
24
transferred, pledged or otherwise modified, and (iii)
the current outstanding principal balance under the BankAtlantic Loan is two
million nine hundred seven thousand eight hundred ninety-four dollars
($2,907,894).
(o) Project. The existing Approvals required for the
completion and operation of the Project, all of the agreements described in Section 2.26(j) and (k)
above, all warranties, construction contacts and all similar documents and
agreements relating to the Property and the Project are in the name of and/or
in favor of the Company. To the best
knowledge of the Company and ORA, the mitigation measures required by the Army
Corps of Engineers and the South Florida Water Management District related to
the big cypress fox squirrels (which requires the maintenance of 19 acres of
natural areas) will not interfere with the completion or operation of the
Project or the potential sale of the Property to A.R.M. There have been no changes to the Property
since the survey dated January 17, 2001 prepared by Wilson Miller, a true,
correct and complete copy of which has been provided to Monaco. To the best knowledge of the Company, and
ORA, there is no opposition to the Project from any individual, group or
entity.
(p) Adverse
Information. The Company has no
information or knowledge that there are any laws, ordinances or restrictions,
or any change contemplated therein, or any judicial or administrative action,
or any action by adjacent landowners, or natural or artificial conditions upon
the Property, or any other facts or conditions which could, in the aggregate,
have a material adverse effect upon the Property or the completion or operation
of the Project, including the value or profitability thereof. The Company has not received any notice from
any insurance company of any defects or inadequacies in any of the Property
which could materially and adversely affect the insurability of the Property or
the Project or the premiums for the insurance thereof. No notice has been given by any insurance
company which has issued a policy with respect to any of the Property or by any
board of fire underwriters (or other body exercising similar functions)
requesting the performance of any repairs, alterations or other work with which
compliance has not been made.
(q) Offer
to Purchase. On September 13, 2002,
the Company entered into an Agreement for Purchase and Sale (the “A.R.M. Contract”) for the sale of the
Property to A.R.M. Development Corp. of S.W. FL, Inc. (“A.R.M.”).
The Company has delivered a true, correct and complete copy of the
A.R.M. Contract to Buyer. Buyer
acknowledges that the A.R.M. Contract contains a due diligence contingency as
to A.R.M.’s obligation to purchase the Property. Neither the Company nor ORA is aware of any reason why A.R.M.
would be unwilling or unable to purchase the Property on the terms set forth in
the A.R.M. Contract.
(r) Delivery
of Documents. The Company has
provided Monaco with true, correct and complete copies of the following items to
the extent that ORA or the Company or their affiliates possess such items: (a) all existing land use and
development licenses, permits and approvals regarding the Project; (b) the
most recent survey of the Property in the Company’s possession; (c) a copy
of the Company’s policy of title insurance on the Property; (d) all of the
documents and agreements described in this Section 2.26, including,
without limitation, those set forth in Schedule 2.26(j) and (k)
and those described in Section 2.26(n), and none of such documents
or agreements have been amended, transferred, other than pursuant to the
BankAtlantic Loan documents, pledged or otherwise modified; (e) copies of all
air, soil, water, engineering (including, without limitation, structural and
seismic reports and reports with respect to the American with
25
Disabilities Act) and environmental reports, tests,
indemnities and materials regarding the Property in the possession of or
commissioned or requested by the Company; (f) a complete copy of all plans
and specifications for the construction of the Improvements and the development
of the Project (the “Plans and Specifications”);
(g) a copy of all construction contracts entered into by the Company or otherwise
in the Company’s possession with regard to the Property; (h) copies of all
concession agreements, commercial licenses, governmental licenses, permits,
covenants, conditions and restrictions and any other agreements related to the
Property, which have been certified by the Company to be true, correct and
complete copies; (i) copies of all contracts relating to the operation,
maintenance and management of the Property, including all service and supply
agreements, franchise agreements and personal property leases; (j) copies of
the Property tax bills for the last three (3) years and a schedule of all bond
assessments, if applicable, for the Property for the last three (3) years; (k)
copies of all financing documents pertaining to the Property; (l) copies of all
fire, casualty (including earthquake and flood), liability and other insurance
policies regarding the Property; and (m) an inventory of all tangible
Personalty.
(s) Monies
Owed. Schedule 2.26(s) sets
forth a true, correct and complete list of all amounts owed by the Company to
third parties in connection with services or supplies furnished to the
Property, the development of the Project or otherwise.
(t) Loan
Applications. The Company has used
all of the loan proceeds received from the BankAtlantic Loan and the Monaco
Loan, except as expressly approved by Monaco as to the Monaco Loan, only for
the purposes for which such proceeds were required in the Company’s loan
application.
(u) Mitigation
Agreement. The Company has paid the
balance of the wetlands mitigation payment required pursuant to section 3.1.2
of the Mitigation Agreement in the amount of $373,538.000 to the Southwest
Florida Wetlands J.V., and no further monies are owed by the Company pursuant
to the Mitigation Agreement. The Southwest Florida Wetlands J.V. has agreed in
writing that the Mitigation Agreement is amended with the following changes: 1)
if the ACOE Permit is not obtained, it will refund to the Company the amount of
$533,625.00, and 2) the ninety day period for obtaining the ACOE Permit and the
SFWMD Permits has been amended to allow the Company two additional ninety day
periods to obtain such permits, which periods shall run sequentially. To the
Company’s and ORA’s knowledge, the U.S. Department of Fish & Wildlife has
agreed to the issuance of the ACOE Permit for the Project. The Company has
fully complied with all provisions and requirements set forth in the SFWMD
Permits and the Mitigation Agreement.
(v) Monaco
Loan. The current outstanding
principal balance under the Monaco Loan is one million eight hundred thousand
dollars ($1,800,000).
2.27 Warranties; Indemnities. Except for
those set forth in this Agreement, the Company has not given indemnities
relating to the Project.
2.28 Representations Complete; Disclosure.
None of the representations or warranties made by the Company and ORA (as
modified by the Sellers’ Disclosure Letter), nor any statement made in any
Schedule or certificate furnished by the Company or ORA pursuant to this
Agreement, contains or will contain at the Closing, any untrue statement of a
material fact, or omits or will omit
26
at the Closing to state any material fact necessary in order to make
the statements contained herein or therein, in the light of the circumstances
under which made, not misleading. Each
document delivered by the Company or its counsel to Monaco or its counsel in
connection with this Agreement or the transactions contemplated hereby was a
true and complete copy of such document including all exhibits, schedules and
amendments thereto.
2.29 No Other Representations or
Warranties. Except for the representations and warranties made by
the Company or ORA in this Agreement, the ORLV Agreement, the ORMCC Agreement,
the Agreement and the Affiliates Agreement, neither the Company nor ORA make
any representations or warranties, and the Company and ORA hereby disclaim any
other representations or warranties, whether made by the Company or ORA or
their respective officers, directors or employees, with respect to the
execution and delivery of this Agreement, the Agreement or the Affiliates
Agreement or the transactions contemplated hereby and thereby, notwithstanding
the delivery or disclosure to Monaco or Buyer or its representatives of any
documentation or other information with respect to any one or more of the
foregoing.
REPRESENTATIONS AND WARRANTIES OF MONACO AND BUYER
Monaco and Buyer represent and warrant to the Company
as follows:
3.1 Organization, Standing and Power.
Each of Monaco and Buyer is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware. Each of Monaco and Buyer has the corporate
power to own its properties and to carry on its business as now being conducted
and is duly qualified to do business and is in good standing in each
jurisdiction in which the failure to be so qualified would have a material
adverse effect on the ability of Monaco or Buyer to consummate the transactions
contemplated hereby.
3.2 Authority. Each of Monaco and Buyer has
all requisite corporate power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of each of Monaco and Buyer. This Agreement has been duly executed and
delivered by Monaco and Buyer and constitutes the valid and binding obligation
of Monaco and Buyer, enforceable in accordance with its terms, except as such
enforceability may be limited by principles of public policy and subject to the
laws of general application relating to bankruptcy, insolvency and the relief
of debtors and rules of law governing specific performance, injunctive relief
or other equitable remedies.
3.3 Consents. No consent of any Person not a
party to this Agreement and no consent of any Governmental Entity is required
to be obtained on the part of Monaco or Buyer to permit the consummation of the
transactions contemplated by this Agreement.
27
3.4 Noncontravention. The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby will not, conflict with any provision of the Certificate of
Incorporation or Bylaws of Monaco or Buyer.
3.5 Brokers’ and Finders’ Fees; Third Party
Expenses. Neither Monaco nor Buyer has incurred, not will they
incur, directly or indirectly, any liability for brokerage or finders’ fees or
agents’ commissions or any similar charges in connection with this Agreement or
any transaction contemplated hereby for which the Company, ORA or the
Principals could become liable or obligated.
3.6 Monaco Loan. The current outstanding principal
balance under the Monaco Loan is one million eight hundred thousand dollars
($1,800,000).
3.7 No Other Representations or
Warranties. Except for the representations and warranties made by
the Monaco or Buyer in this Agreement, the ORLV Agreement and the ORMCC
Agreement, neither Monaco nor Buyer make any representations or warranties, and
Monaco and Buyer hereby disclaim any other representations or warranties,
whether made by the Monaco or Buyer or their respective officers, directors or
employees, with respect to the execution and delivery of this Agreement or the
transactions contemplated hereby and thereby, notwithstanding the delivery or
disclosure to ORA or its representatives of any documentation or other information
with respect to any of the foregoing.
ARTICLE
IV
CONDUCT
PRIOR TO CLOSING
4.1 Conduct of Business of the Company.
During the period from the date of this Agreement and continuing until the
earlier of the termination of this Agreement or the Closing, the Company agrees
(except to the extent that Monaco shall otherwise consent in writing), to carry
on its business in the usual, regular and ordinary course in substantially the
same manner as heretofore conducted, materially comply with all the terms,
conditions and provisions of all laws, rules regulations, orders, leases,
liens, mortgages, agreements, insurance policies and other contractual
arrangements relating to the Property, to pay its debts and Taxes when due, to
pay or perform other obligations when due, confer with Monaco concerning
material business or operational matters relating to the Company’s business,
use reasonable, good faith efforts to maintain all the assets of the Company in
their current condition and to promptly replace, repair or restore such assets
in the event of any damage to or destruction of any of such assets prior to the
Closing, maintain the books and records in the usual, regular and ordinary
manner, on a basis consistent with prior years, report periodically to Monaco concerning
the status and operation of the Project, and to use all reasonable efforts
consistent with past practice and policies to preserve intact the Company’s
present business organizations, keep available the services of its present
officers and key employees and preserve their relationships with customers,
suppliers, licensors, licensees, and others having business dealings with it,
all with the goal of preserving unimpaired the Company’s goodwill and ongoing
28
businesses at the Closing; it being understood that Monaco and the
Company shall keep each other informed of developments to, and relating actions
to be taken in connection with the matters described in Schedule 6.3(g)
hereto. Without limiting the foregoing,
but subject to the limitations in Sections 4.1(a)-4.1(bb) below,
during such period, the Company agrees to (i) use commercially reasonable
efforts to sell the Property to A.R.M. pursuant to the terms of the A.R.M.
Contract or other terms reasonably acceptable to Monaco, or if A.R.M. is unable
to purchase the Property or terminates the A.R.M. Contract, to a third party on
terms acceptable to Monaco, (ii) perform all of its obligations under all
Approvals and applications therefore, including as required to comply with the
terms of or keep in force the Mitigation Agreement and the SFWMD Permits, and
to maintain its efforts to obtain the required ACOE Permits and (iii) maintain
the present insurance on the Property and promptly provide Monaco with copies
of any written notice from any insurance company or board of fire underwriters
(or other body exercising similar functions) of any defects or inadequacies in
the Property or requesting performance of any repairs, alterations or other
work to the Property. The Company shall promptly notify Monaco of any event or
occurrence or emergency not in the ordinary course of business of the Company,
and any material event involving the Company.
Except as expressly contemplated by this Agreement, the Company shall
not, without the prior written consent of Monaco:
(a) Enter
into any commitment or transaction not in the ordinary course of business or
any commitment or transaction of the type described in Section 2.8
hereof;
(b) Enter
into, assume, become bound or obligated by, or extend or modify the terms of
any agreement, contract or commitment which (i) involves the payment of greater
than $10,000 per annum, (ii) extends for more than one year or (iii) involves
any payment or obligation to any affiliate of the Company;
(c) Prepay
any outstanding indebtedness other than payments described in Section 4.2
hereof;
(d) Transfer
to any Person any rights to the Intellectual Property;
(e) Amend
or otherwise modify (or agree to do so), except in the ordinary course of
business, or violate the terms of, any of the Company Contracts or Approvals;
(f) Amend
or otherwise modify (or agree to do so) the A.R.M. Contract;
(g) Commence,
settle, institute, prosecute, compromise any action, suit, proceeding,
arbitration, or governmental or regulatory investigation or audit or obtain the
release of any threatened action, suit, proceeding, arbitration, or
governmental or regulatory investigation or audit involving or relating to the
Company or its business or assets;
(h) Declare
or pay any dividends on or make any other distributions (whether in cash, stock
or property) in respect of any of its capital stock, or split, combine or
reclassify any of its capital stock or issue or authorize the issuance of any
other securities in respect of, in lieu of or in substitution for shares of
capital stock of the Company, or repurchase, redeem or otherwise acquire,
29
directly
or indirectly, any shares of its capital stock (or options, warrants or other
rights exercisable therefor);
(i) Issue,
deliver or sell or authorize or propose the issuance, delivery or sale of, or
purchase or propose the purchase of, any shares of its capital stock or
securities convertible into, or subscriptions, rights, warrants or options to
acquire, or other agreements or commitments of any character obligating it to
issue any such shares or other convertible securities;
(j) Cause
or permit any amendments to its Articles of Incorporation or Bylaws;
(k) Acquire
or agree to acquire by merging or consolidating with, or by purchasing a
substantial portion of the assets of, or by any other manner, any business or
any corporation, partnership, association or other business organization or
division thereof, or otherwise acquire or agree to acquire any assets which are
material, individually or in the aggregate, to the business of the Company;
(l) Sell,
lease, license or otherwise dispose of any of its properties or assets, or
grant a security interest in any of such properties or assets;
(m) Incur
any indebtedness for borrowed money or guarantee any such indebtedness or issue
or sell any debt securities of the Company or guarantee any debt securities of
others;
(n) Hire
or extend an offer of employment with the Company to any individual;
(o) Change,
increase or amend the rate of remuneration or amount of bonuses or other
benefits or any other terms of employment of any employee;
(p) Grant
any severance or termination pay to any employee, or adopt any new severance
plan, amend or modify or alter in any manner any severance plan, agreement or
arrangement relating to any employee;
(q) Adopt
or amend any Plan;
(r) Revalue
any of its assets, including without limitation writing down the value of
inventory or writing off notes or accounts receivable other than in the
ordinary course of business;
(s) Pay,
discharge or satisfy, in an amount in excess of $25,000 (in any one case) or
$50,000 (in the aggregate), any claim, liability or obligation (absolute,
accrued, asserted or unasserted, contingent or otherwise), other than the
payment, discharge or satisfaction in the ordinary course of business of
liabilities reflected or reserved against in the Company Financial Statements
(or the notes thereto);
(t) Make
or change any material election in respect of Taxes, adopt or change any
accounting method in respect of Taxes, enter into any closing agreement, settle
any claim or assessment in respect of Taxes, or consent to any extension or
waiver of the limitation period applicable to any claim or assessment in
respect of Taxes;
30
(u) Enter
into any strategic alliance or joint marketing arrangement or agreement;
(v) grant
any loans to others or purchase debt securities of others or amend the terms of
any outstanding loan agreement;
(w) enter
into any agreement to purchase or sell any interest in real property, grant any
security interest in any real property or enter into any lease, sublease,
license or other occupancy agreement with respect to any real property;
(x) grant
nor otherwise create or consent to the creation of any easement, covenant,
restriction, assessment, encumbrance or lien affecting any of the Property;
(y) convey
any of the Property or any interest or rights therein (other than pursuant to
the terms of the A.R.M. Contract), nor commit, permit or suffer to exist any
waste or nuisance on the Property;
(z) make
or permit to be made any material change in the Property;
(aa) take
any action, or fail to take any action, that would reasonably be expected to
result in any of the representations and warranties set forth in ARTICLE II not being true and correct on and as of
the Closing Date with the same force and effect as if such representations and
warranties had been made on and as of the Closing Date; or
(bb) take,
or agree in writing or otherwise to take, any of the actions described in Sections
4.1(a) through (aa) above, or any other action that would prevent the
Company from performing or cause the Company not to perform its covenants
hereunder.
4.2 Sale to A.R.M. In the event that the
Company sells the Property to A.R.M. pursuant the A.R.M. Contract (the “A.R.M. Sale”) prior to the Closing:
(a) the
Company shall pay to Monaco upon close of escrow of the A.R.M. Sale (the “A.R.M. Closing Date”) (1) all amounts
outstanding (including interest) under the Monaco Loan or otherwise advanced by
Monaco and (2) a sum equal to 50% of the A.R.M Net Profit. “A.R.M.
Net Profit” shall mean all cash proceeds from the A.R.M. Sale received
by the Company, less:
(i) all
amounts outstanding (including interest) on the BankAtlantic Loan that have
been repaid in connection with the A.R.M. Sale;
(ii) all
amounts outstanding (including interest) on the Monaco Loan or otherwise
advanced by Monaco that have been repaid in connection with the A.R.M. Sale;
(iii) all
reasonable overhead costs of the Company relating to the operation and
management of the Property prior to the A.R.M. Closing Date;
(iv) All
amounts paid to the Robert A. Schoellhorn Trust pursuant to Section 4.2(b);
31
(v) all
liabilities incurred or costs paid by the Company (other than amounts owed or
paid to ORA or any affiliates of ORA) in connection with the operation of the
business of the Company or the Property prior to the consummation of the A.R.M
Sale, including payment of real estate taxes, assessments, insurance, permit
and land use fees and approvals, attorneys’ fees and consultants’ fees; and
(vi) all
liabilities incurred or costs paid by the Company (other than amounts owed or
paid to ORA or any affiliates of ORA) in connection with the A.R.M Sale,
including broker commissions, transfer taxes, escrow costs, title costs, survey
costs, attorneys’ fees and other closing costs.
(b) the
Company shall pay to the Robert A. Schoellhorn Trust upon the A.R.M Closing
Date the amount set forth on Schedule 9.1(c).
(c) the
parties hereto will no longer have any obligations pursuant to this Agreement
other than the obligations contained in Sections 4.2, 5.4, 5.5, 5.6,
and ARTICLE X hereof.
(d) the
payments obligations of the Company pursuant to Section 4.2(a)
hereof will supercede the payment obligations of the Company to Monaco pursuant
to Sections 7.2 and ARTICLE IX of that certain Agreement
dated July, 2001, by and between ORA, the Company and Monaco, as amended,
relating to the Monaco Loan.
4.3 Other Offers. In the
event the Company or ORA or any of the Principals shall receive any offer or
proposal with respect to any proposed agreement, contract or commitment to sell
to any Person other than Monaco or the Buyer all or any portion of the
Company’s business and properties or capital stock, whether by merger, sale of
assets, tender offer or otherwise (an “Alternate
Transaction”), the Company and/or ORA shall promptly (i) inform
Monaco that such an offer or proposal has been received and (ii) disclose to
Monaco the identity of the party making the offer or proposal and the terms of
such offer or proposal. Thereafter, the
Company and ORA shall consult with Monaco regularly with regard to such offer
or proposal and the status of discussions and/or negotiations with respect
thereto. The Company and ORA will not
enter into, and will prohibit the Company’s and ORA’s officers from entering
into, any agreement, contract or commitment with respect to an Alternate
Transaction without the prior written consent of Monaco.
ARTICLE
V
ADDITIONAL
AGREEMENTS
5.1 Securityholder Agreements.
(a) Agreement
to Retain Shares. ORA agrees not to
transfer (except as may be specifically required by court order), sell,
exchange, pledge or otherwise dispose of or encumber any shares of capital
stock of the Company beneficially owned by ORA as of the date hereof, or to
make any offer or agreement relating thereto, at any time prior to the
Expiration Date. As used herein, the
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term “Expiration Date” shall mean the earlier to
occur of (i) the Closing Date, and (ii) such date and time as this Agreement
shall be terminated pursuant to Article VIII hereof.
(b) Agreement
to Vote Shares. At every meeting of
the shareholders of the Company called with respect to any of the following,
and at every adjournment thereof, and on every action or approval by written
consent of the shareholders of the Company with respect to any of the
following, ORA shall vote the Shares:
(i) in favor of approval of this Agreement and the Acquisition and any
matter that could reasonably be expected to facilitate the Acquisition; and (ii) against approval of
any proposal made in opposition to or competition with consummation of the
Acquisition and against any merger, consolidation, sale of assets,
reorganization or recapitalization, with any party other than with Monaco,
Buyer and their affiliates and against any liquidation or winding up of the
Company.
(c) Additional
Documents. ORA hereby covenants and
agrees to execute and deliver any additional documents necessary or desirable,
in the reasonable opinion of Monaco or the Company, as the case may be, to
carry out the intent of this Agreement.
(d) Consent
and Waiver. ORA hereby gives any
consents or waivers that are reasonably required for the consummation of the
Acquisition under the terms of any agreements to which such ORA is a party or
pursuant to any rights ORA may have.
5.2 Resignation of Directors and
Officers of Company. The Company and ORA shall use their
reasonable best efforts to cause all of the directors and officers of the
Company to resign their respective positions effective as of the Closing, and
to cause each director and officer of the Company to deliver written notice of
such resignation to Buyer at the Closing.
5.3 Access. The Company and ORA shall afford Monaco
and its accountants, counsel, consultants, and other representatives, full and
complete access to the Property and the Company’s books and records, personnel,
business and commercial relationships relating to the Company’s business, the
Property and the Project during normal business hours during the period from
the date hereof and prior to the Closing, including without limitation, to (i)
all of the Company’s and ORA’s properties, books, contracts, commitments, and
records related to the Company’s business, the Property and the Project,
including without limitation, access to the Property for the purpose of (a)
conducting an environmental audit or assessment that may include soil,
groundwater, or Hazardous Materials sampling as Monaco in its discretion deems
necessary and desirable to identify the presence or absence of Hazardous
Materials, (b) conducting such surveys, tests, inspections and examinations as
Monaco desires in regard to engineering and planning for future development of
the Property, and examining the current condition of the Property, and
determining the feasibility of future uses of the Property, including without
limitation, as-built surveys, engineering studies, and seismic tests and (c)
communicating with the Company’s personnel, consultants, Governmental Entities,
and representatives from financial institutions, (ii) other information
concerning the business, properties and personnel (subject to restrictions
imposed by applicable law) of the Company, including but not limited to
documents relating to the planning, permitting, construction and development
costs (“Development Costs”) of the
Project, forecasted future Development Costs of the Project and actual and
forecasted sales of lots within the Project, and (iii) the records of the
Company’s independent accountants related to the Property or the Project. The
Company agrees to
33
provide to Monaco and its accountants, counsel, consultants, and other
representatives copies of internal financial statements (including Tax returns
and supporting documentation) promptly upon request. No information or knowledge obtained in any investigation
pursuant to this Section 5.3 shall affect or be deemed to modify
any representation or warranty contained herein or the conditions to the
obligations of the parties to consummate the Acquisition.
5.4 Confidentiality. Each of the parties
hereto hereby agrees to keep such information or knowledge obtained in any
investigation pursuant to Section 5.3, or pursuant to the
negotiation and execution of this Agreement or the effectuation of the
transactions contemplated hereby (“Confidential
Information”), confidential and not to use such Confidential
Information except as contemplated by this Agreement; provided, however, that
the foregoing shall not apply to information or knowledge which (a) a
party can demonstrate was already lawfully in its possession prior to the
disclosure thereof by the other party, (b) is generally known to the
public and did not become so known through any violation of law, (c) became
known to the public through no fault of such party, (d) is later lawfully
acquired by such party from other sources (and not in violation of an
obligation of confidentiality of such other sources with respect to such
information), (e) is required to be disclosed by order of court or
government agency with subpoena powers, (f) is disclosed in the course of any
litigation between any of the parties hereto or (g) is developed independently
by either party without reference to, or specific knowledge of, the other
parties’ Confidential Information.
5.5 Expenses. Whether or not the Acquisition is
consummated, all fees and expenses incurred in connection with the Acquisition
shall be the obligation of the respective party incurring such fees; provided,
however, all fees and expenses incurred by the Company in connection
with the Acquisition shall be borne by ORA.
Such expenses shall include, without limitation, all legal, accounting,
financial advisory, consulting and all other fees and expenses of third parties
incurred by a party in connection with the negotiation and effectuation of the
terms and conditions of this Agreement and the transactions contemplated
hereby.
5.6 Brokers’ or Finders’ Fees. Monaco
and Buyer will indemnify and hold the Company and ORA harmless from any claim
for brokers’ or finders’ fees arising out of the transactions contemplated
hereby by any Person claiming to have been engaged by Monaco or Buyer. ORA will indemnify and hold Monaco and Buyer
harmless from any claim for brokers’ or finders’ fees arising out of the
transactions contemplated hereunder by any Person claiming to have been engaged
by the Company or ORA.
5.7 Consents. The Company and ORA shall use
their reasonable best efforts to obtain the consents, waivers and approvals
under any of the Company Contracts as may be required in connection with the
Acquisition so as to preserve all rights of, and benefits
to, the Company thereunder.
5.8 Reasonable Best Efforts. Subject to
the terms and conditions provided in this Agreement, each of the parties hereto
shall use its reasonable best efforts to take promptly, or cause to be taken,
all actions, and to do promptly, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the transactions contemplated hereby, to obtain all necessary
waivers, consents and approvals and to effect all necessary registrations and
filings and to remove any injunctions or other impediments or delays,
34
legal or otherwise, in order to consummate and make effective the
transactions contemplated by this Agreement for the purpose of securing to the
parties hereto the benefits contemplated by this Agreement.
5.9 Notification of Certain Matters.
The Company and ORA shall give prompt notice to Monaco, and Monaco shall give
prompt notice to the Company, of (i) the occurrence or nonoccurrence of any
event, the occurrence or nonoccurrence of which is likely to cause any
representation or warranty of the Company, ORA, Monaco or Buyer, respectively,
contained in this Agreement to be untrue or inaccurate at or prior to the
Closing Date and (ii) any failure of the Company, ORA, Monaco or Buyer, as the
case may be, to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder; provided, however, that the
delivery of any notice pursuant to this section shall not (a) limit or
otherwise affect any remedies available to the party receiving such notice or
(b) constitute an acknowledgment or admission of a breach of this
Agreement. No disclosure by any party
pursuant to this Section 5.9 shall be deemed to amend or supplement
the Disclosure Letter or prevent or cure any misrepresentation, breach of
warranty or breach of covenant.
5.10 Election to Supplement Sellers’
Disclosure Letter. ORA is entitled to make a one time election
(the “Supplemental Disclosure Election”)
to provide Monaco with a Supplement to the Seller’s Disclosure Schedule (the “Disclosure Supplement”) at least seven (7)
days prior to the Closing Date or, if Monaco provides less than nine (9) days
notice of the Closing Date, within two (2) days after notice of the Closing
Date. The Disclosure Supplement may contain
only qualifications to ORA’s representations and warranties that the Company
and ORA had no knowledge of as of the date of this Agreement. Notwithstanding Section 5.9
hereof, the Disclosure Supplement will be deemed to amend the Sellers’
Disclosure Schedule and to cure any breach of any or the representations or
warranties related to such Disclosure Supplement. If ORA makes the Supplemental Disclosure Election, Monaco may
terminate this Agreement in its sole an absolute discretion, whether or not the
information contained in the Disclosure Supplement is material.
5.11 Inspection Period. Notwithstanding the
provisions of Section 5.8, at any time between the date hereof and
the date that is thirty (30) days thereafter (the “Inspection Period”), Monaco may terminate this Agreement in
accordance with the provisions of this Section if (a) Monaco is not satisfied,
in Monaco’s sole and absolute discretion, with the information obtained from
its examination of the Property or from documents delivered to it by the
Company pursuant to the provisions of this Agreement or otherwise obtained by
the Monaco; or (b) Monaco is not satisfied, in Monaco’s sole and absolute
discretion, with the information determined by it or its representatives’
inspections of or inquiries regarding the Property or relevant financial
records; or (c) if Monaco does not approve, in Monaco’s sole and absolute
discretion, the form and substance of each Permitted Exception or is
dissatisfied in any other way. This
Agreement establishes an option which can be exercised for any of the foregoing
reasons if Monaco notifies the Company of its dissatisfaction, in writing,
on or prior to the last day of the Inspection Period, which notice may, but
need not, set forth the conditions giving rise to Monaco’s dissatisfaction, if
any. Monaco shall have the right at its
option either immediately to terminate this Agreement by written notice or to
terminate this Agreement immediately prior to the date specified in Section 8.1(b)(i)
unless those conditions specified in the notice of dissatisfaction have by then
been satisfied to Monaco’s satisfaction in Monaco’s sole and absolute
discretion.
35
5.12 Risk of Loss. The Company shall bear all risk
of loss or damage to the Property by fire, other casualty, condemnation or
Hazardous Materials prior to the Closing.
If before the Closing the Property should be damaged or taken or
threatened to be taken or Hazardous Materials shall become present on the
Property, or if access to or parking for the Property is altered in any regard,
Monaco may, at its option, (a) terminate this Agreement by written notice
delivered to the Company at or prior to the Closing or (b) proceed to Closing
as provided under this Agreement, in which event Monaco shall receive any and
all insurance and condemnation proceeds attributable to the casualty or
condemnation.
5.13 Notice of Damage. If at any time prior to
the Closing all or any portion of the Property is destroyed or damaged as a
result of fire or any other cause whatsoever, or taken by condemnation or
eminent domain or any proceeding in condemnation or eminent domain or the
Company or ORA become aware of the threat of such taking, or Hazardous
Materials shall become present on the Property, the Company or ORA, as
applicable, shall promptly give written notice thereof to Monaco.
5.14 Public Disclosure. No party shall issue
any statement or communication to any third party (other than to their
respective agents) regarding the subject matter of this Agreement or the
transactions contemplated hereby, including, if applicable, the termination of
this Agreement and the reasons therefore, without the prior written consent of
the other party, which consent shall not be unreasonably withheld. This Section 5.14 shall not
apply to any disclosure deemed necessary or advisable by Monaco (i) in order
for Monaco to complete its due diligence of the Company, (ii) in order to
comply with applicable securities laws, or to any disclosure required by other
applicable law or (iii) to satisfy the condition to Closing set forth in Section 6.2(c).
5.15 Closing Cost Schedule. Monaco and ORA
shall mutually agree at least one (1) business day prior to the Closing Date on
a Closing Cost Schedule, which shall identify the Closing Costs.
5.16 Additional Documents and Further
Assurances. Each party hereto, at the request of another party
hereto, shall execute and deliver such other instruments and do and perform
such other acts and things as may be necessary or desirable for effecting
completely the consummation of this Agreement and the transactions contemplated
hereby.
CONDITIONS TO THE ACQUISITION
6.1 Conditions to Obligations of Each
Party to Effect the Acquisition.
The respective obligations of each party to this Agreement to effect the
transactions contemplated by this Agreement shall be subject to the
satisfaction at or prior to the Closing of the following conditions:
(a) No
Injunctions or Restraints; Illegality.
No temporary restraining order, preliminary or permanent injunction or
other order issued by any court of competent jurisdiction or other legal
restraint or prohibition preventing the consummation of the transactions
contemplated by
36
this
Agreement shall be in effect, nor shall any proceeding brought by an
administrative agency or commission or other governmental authority or
instrumentality, domestic or foreign, seeking any of the foregoing be pending;
nor shall there be any action taken, or any statute, rule, regulation or order
enacted, entered, enforced or deemed applicable to the Acquisition, which makes
the consummation of the Acquisition illegal.
(b) Certain
Related Agreements. (i) All
conditions set forth in ARTICLE VII of each of the ORMCC Agreement and
the ORLV Agreement shall have been satisfied or waived and (ii) the ORMCC
Acquisition and the ORLV Acquisition shall have closed concurrently with the
Closing.
(c) Federal
and State Filings and Approvals.
All applicable federal and state filing or licensing requirements, and
all required federal and state regulatory approvals, in connection with the
transactions contemplated by this Agreement shall have been satisfied or
obtained, respectively.
6.2 Additional Conditions to Obligations
of the Company and ORA . The obligations of the Company
and ORA to consummate and effect this Agreement and the transactions
contemplated hereby shall be subject to the satisfaction at or prior to the
Closing of each of the following conditions, any of which may be waived, in
writing, exclusively by the Company and ORA:
(a) Representations,
Warranties and Covenants. The
representations and warranties of Monaco and Buyer in this Agreement shall be
true and correct in all material respects on and as of the Closing as though such
representations and warranties were made on and as of such time (other than
those representations and warranties which were qualified by terms such as
“material,” “materially,” or “Material Adverse Effect,” which representations
and warranties shall have been true and correct, as so qualified, in all
respects on and as of the Closing) and Monaco and Buyer shall have performed
and complied in all material respects with all covenants, obligations and
conditions of this Agreement required to be performed and complied with by
them.
(b) Certificate
of Monaco. ORA shall have been
provided with a certificate executed on behalf of the Monaco by one of its
executive officers to the effect that, as of the Closing:
(i) all
representations and warranties made by the Monaco and Buyer in this Agreement
are true and correct in all material respects (other than those representations
and warranties which were qualified by terms such as “material,” “materially,”
or “Material Adverse Effect,” which representations and warranties so qualified
shall have been true and correct in all respects on and as of the Closing);
(ii) all
covenants and obligations under this Agreement to be performed or complied with
by Monaco and Buyer on or prior to the Closing have been so performed or
complied with in all material respects; and
37
(iii) all
conditions to the obligations of the Company set forth in this Section 6.2
have been satisfied (unless otherwise waived in accordance with the terms of
this Agreement.
(c) Payment
of BankAtlantic Loan. Monaco shall
have paid or caused to be paid to BankAtlantic the entire outstanding principal
and interest under the BankAtlantic Loan.
6.3 Additional Conditions to the Obligations
of Monaco and Buyer. The obligations of Monaco and Buyer to
consummate and effect this Agreement and the transactions contemplated hereby
shall be subject to the satisfaction at or prior to the Closing of each of the
following conditions, any of which may be waived, in writing, exclusively by
Monaco:
(a) Representations,
Warranties and Covenants. The
representations and warranties of the Company and ORA in this Agreement were
true and correct on the date they were made and shall be true and correct in
all material respects on and as of the Closing as though such representations
and warranties were made on and as of such time (other than those
representations and warranties which were qualified by terms such as
“material,” “materially,” or “Material Adverse Effect,” which representations
and warranties shall have been true and correct, as so qualified, in all
respects on and as of the Closing) and each of the Company and ORA shall have
performed and complied in all material respects with all of their respective
covenants, obligations and conditions of this Agreement required to be
performed and complied with by them as of the Closing.
(b) Written
Resignations. All directors and
officers of the Company shall have delivered to Buyer written resignations from
their respective positions, effective as of the Closing.
(c) Certificates
of Company ORA. Monaco shall have
been provided with certificates executed by ORA and executed on behalf of the
Company by its President and Secretary to the effect that, as of the Closing:
(i) all
representations and warranties made by the party providing the certificate in
this Agreement are true and correct in all material respects (other than those
representations and warranties which were qualified by terms such as
“material,” “materially,” or “Material Adverse Effect,” which representations
and warranties shall have been true and correct as so qualified in all respects
on and as of the Closing);
(ii) all
covenants and obligations under this Agreement to be performed or complied with
by the Company and the party providing the certificate on or prior to the
Closing have been so performed or complied with in all material respects; and
(iii) all
conditions to the obligations of Monaco and Buyer set forth in this Section 6.3
have been satisfied (unless otherwise waived in accordance with the terms of
this Agreement.)
(d) Secretary’s
Certificate of Company. Monaco
shall have been provided with a certificate executed on behalf of the Company
by its Secretary to the effect that, as of the Closing:
38
(i) the
Company has provided Monaco with complete and accurate copies of the Company’s
Articles of Incorporation and Bylaws, each as amended and corrected to date;
(ii) the
Company has provided Monaco with complete and accurate copies of resolutions of
ORA’s and the Company’s Boards of Directors approving the Acquisition and the
transactions contemplated by this Agreement; and
(iii) the
Company has provided Monaco with complete and accurate copies of resolutions of
its shareholders approving the Acquisition and the transactions contemplated by
this Agreement.
(e) Incumbency
Certificate. The Company has
provided Buyer with a certificate as to the incumbency of signatories and
genuineness of signatures.
(f) Claims. No claims shall have been asserted (whether
or not asserted in litigation) which might materially and adversely affect the
consummation of the transactions contemplated hereby or the business assets
(including intangible assets), financial condition or results of operations of
the Company.
(g) Third
Party Consents. Any and all
consents, waivers, and approvals listed pursuant to Schedule 6.3(g)
shall have been obtained.
(h) Soper
Opinion. Monaco shall have received
a legal opinion from Soper & Oakley, PLLC, legal counsel to the Company and
ORA, substantially in the form of Exhibit D hereto.
(i) Tribler
Opinion. Monaco shall have received
a legal opinion from Tribler Orpett & Crone, Professional Corporation, legal
counsel to the Principals, substantially in the form of Exhibit E
hereto.
(j) No
Material Adverse Changes. There
shall not have occurred any material adverse change in the business, assets
(including intangible assets), results of operations, liabilities (contingent
or accrued) or financial condition of the Company.
(k) Litigation. There shall be no action, suit, claim or
proceeding of any nature pending, or overtly threatened, against the Buyer or
the Company, their respective properties or any of their officers or directors,
arising out of, or in any way connected with, the Acquisition or the other
transactions contemplated by the terms of this Agreement.
(l) FIRPTA
Compliance. The Company shall have
delivered to Monaco a properly executed statement in a form reasonably
acceptable to Monaco for purposes of satisfying Monaco’s and Buyer’s
obligations under Treasury Regulation Section 1.1445-2(b).
(m) Intercompany
Payables. ORA shall have provided
evidence satisfactory to Monaco that all Intercompany Payables have been
permanently and irrevocably forgiven.
39
(n) Title
Insurance. Buyer shall have obtained an ALTA form of owner’s title
insurance policy with the survey exception deleted insuring Buyer’s fee simple
title to the Property following the Closing at standard rates in the amount of
$7.2 million, subject only to the Permitted Exceptions, and including
mechanics’ and materialmen’s liens coverage, zoning and subdivision
endorsements and such endorsements as Buyer may require (the “Title Policy”).
(o) Title
Affidavits. The Company and ORA
shall have provided such affidavits and other documents as are reasonably
required as a condition to issuing the Title Policy without the survey
exception or other exceptions, except the Permitted Exceptions, including,
without limitation, an owner’s affidavit, mechanics’ lien indemnity, gap
indemnity and an affidavit that there have been no changes to the Property
since the January 17, 2001 survey of the Property.
(p) Loan
Documents. Buyer shall have
received pay-off statements acceptable to Monaco and the title company issuing
the Title Policy regarding the BankAtlantic Loan and any liens to be satisfied
on Closing, and such other documents and instruments (including, without
limitation, requests for reconveyance or substitutions of trustee and
reconveyances of deeds of trust) as the title company issuing the Title Policy
may require as a condition to insuring Buyer’s title to the Property free and
clear of such deeds of trust.
(q) Intercompany
Receivables. The Company shall have
been paid all amounts owed to it pursuant to Intercompany Receivables.
(r) Permits. Any Governmental Authorization relating to
the Project issued to any person or entity other than the Company shall have
been transferred to or re-issued in the name of the Company.
(s) Guaranty. Each of the parties to the Guaranty shall
have executed and delivered the Guaranty.
(t) Affiliates
Agreement. Each of the parties to
the Affiliates Agreement shall have executed and delivered the Affiliates
Agreement.
(u) Crary
Opinion. Monaco shall have received
a legal opinion from Crary, Buchanan, Bowdish, Bovie, Beres, Negron &
Thomas, legal counsel to the Company, substantially in the form of Exhibit F
hereto.
SURVIVAL
OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION
7.1 Survival of Representations and
Warranties. All representations and warranties in this Agreement
or in any instrument delivered
pursuant to this Agreement, shall survive the Closing for three years, provided,
however, that (i) the representations and warranties in Section 2.2(b)
40
relating to title matters and the representations and warranties in Sections 2.9
relating to tax matters shall survive the Closing and shall not terminate and
(ii) the representations and warranties in Sections 2.19 and 2.26(e)
relating to environmental matters and hazardous substances shall survive the
Closing and shall terminate at the close of business on the 120th
day following the expiration of the applicable statute of limitations with
respect to the environmental liabilities in question.
7.2 Indemnification.
(a) General
Indemnification. ORA covenants and agrees to indemnify, defend, protect and
hold harmless Monaco, Buyer and their affiliates (each an “Indemnified Party”) from, against and in
respect of any claim, loss, expense, liability or other damage (including
without limitation any liability of Monaco, Buyer or any of their affiliates
for expenses incurred by the Company related to the transactions contemplated
hereby), including reasonable attorneys’ fees, to the extent of the amount of
such claim, loss, expense, liability or other damage that Monaco, Buyer or any
of their affiliates have incurred or reasonably and in good faith anticipates
incurring (i) by reason of the inaccuracy or breach of any representation or
warranty of the Company and ORA contained herein or in any certificate,
instrument, or other document delivered pursuant to this Agreement, subject to Section 7.1,
(ii) by reason of a breach of any covenant or agreement, of the Company and ORA
contained herein, (iii) relating to ORA’s and Company’s Unknown Environmental
Liabilities, but only to the extent of any Environmental Remediation Costs,
(iv) relating to Taxes attributable to ORA or a member of ORA’s affiliated
group (as defined in Section 1504(a)) of the Code (other than the Company) as a
result of the Company having been a member of ORA’s affiliated group or having
filed a consolidated (or similar) return with the ORA affiliated group or (v)
relating to any and all payroll, employee related or income taxes whensoever
arising with respect to or relating to the Company that are attributable to any
taxable period ending on or prior to the Closing Date and, in case of a taxable
period that includes, but does not end on the Closing Date, the portion of such
taxable period that ends on the Closing Date (all of the foregoing collectively
“Losses”); provided, however, that
Monaco and Buyer shall only have the right to be indemnified against Losses
described in clauses (i), (ii) and (iii) above if, and to the extent that, the
aggregate of the Losses (as such term is defined in each of this Agreement, the
ORMCC Agreement and the ORLV Agreement) under this Agreement, the ORMCC
Agreement and the ORLV Agreement exceeds $250,000 (though the right to offset
Losses set forth in Section 9.2(b) shall apply to all Losses and
not solely to the amount of Losses above and beyond such $250,000
threshold). After the Closing, ORA’s
aggregate contractual liability for Losses under this Agreement, the ORMCC
Agreement and the ORLV Agreement shall not exceed the Indemnification Cap;
provided, however, that nothing herein shall limit any noncontractual remedy
for fraud. For the purpose of determining the amount of any Loss for which any
of the indemnified parties may be entitled to indemnification by ORA pursuant
to this ARTICLE VII, any representation or warranty contained in this
Agreement or in any certificate, instrument, or other document delivered
pursuant to this Agreement that is qualified by a term or terms such as
“material,” “materially,” or “Material Adverse Effect,” shall be deemed made or
given without such qualification.
41
(c) Indemnification
Procedures. All claims for
indemnification under this ARTICLE VII shall be asserted and resolved as
follows:
(i) Indemnification
Claims. In the event that an
Indemnified Party has a claim for Losses hereunder which does not involve claim
being asserted against or sought to be collected by a third party, Monaco shall
deliver to ORA and each of the Principals a certificate signed by any officer
of Monaco (an “Officer’s Certificate”):
(A) stating that Monaco (or an Indemnified Party) has paid or properly
accrued or reasonably and in good faith anticipates that it will have to pay or
accrue Losses, and (B) specifying in reasonable detail the individual items of
Losses included in the amount so stated, the date each such item was paid or
properly accrued, or the basis for such anticipated liability, and the nature
of the misrepresentation, breach of warranty or claim to which such item is
related. If ORA does not notify Monaco
in writing within thirty (30) days from the date of receipt of the Officer’s
Certificate that ORA objects to any claim or claims made in any Officer’s
Certificate, the amount of the claim for Losses contained in the Officer’s
Certificate shall be conclusively deemed a liability of the indemnifying party
hereunder. Notwithstanding the
foregoing, Monaco may not deliver an Officer’s Certificate to ORA to seek
indemnification from ORA pursuant to this Section 7.2 for Losses
relating to the inaccuracy or breach of any representation or warranty of ORA
contained herein or in any certificate, instrument, or other document delivered
pursuant to this Agreement after the applicable representations or warranties
have terminated in accordance with Section 7.1.
(ii) Resolution
of Conflicts.
(1) In
case ORA shall so object in writing to any claim or claims made in any
Officer’s Certificate, ORA and Monaco shall attempt in good faith to agree upon
the rights of the respective parties with respect to each of such claims. If ORA and Monaco should so agree, a
memorandum setting forth such agreement shall be prepared and signed by both
parties.
(iii) If
no such agreement can be reached after good faith negotiation, either Monaco or
ORA may demand arbitration of the matter as set forth below in Section 7.3
unless the amount of the damage or loss is at issue in pending litigation with
a third party, in which event arbitration shall not be commenced until such
amount is ascertained by court judgment or settlement of the parties to the
litigation or Monaco and ORA agree to arbitration.
(d) Third-Party
Claims. In the event Monaco becomes
aware of a third-party claim which Monaco believes may result in a claim by
Monaco for indemnification pursuant to this ARTICLE VII, Monaco shall
notify ORA of such claim, and ORA shall be entitled, at its expense, to
participate in any defense of such claim.
Monaco shall have the right in its sole discretion to settle any such
claim; provided, however, that except with the consent of ORA, no settlement of
any such claim with third-party claimants shall alone be determinative of the
amount of any claim against ORA under this Section 7.2. In the event that ORA has consented to any
such settlement, ORA shall have no power or authority to object under any
provision of this ARTICLE VII to the amount of any claim by Monaco
against ORA for indemnification with respect to such settlement.
42
7.3 Arbitration.
(a) The
resolution of any disputes arising under this ARTICLE VII shall be settled
by Arbitration. Such arbitration shall
be conducted by three arbitrators.
Monaco shall select one arbitrator and ORA shall select one arbitrator. The two arbitrators so selected shall select
a third arbitrator. The decision of a
majority of the three arbitrators as to the validity and amount of any claim in
an Officer’s Certificate shall be binding and conclusive upon the parties to
this Agreement.
Judgment upon any award rendered by the arbitrators
may be entered in any court having jurisdiction. Any such arbitration shall be held in Lane County, Oregon under
the rules then in effect of the American Arbitration Association. For purposes
of this subsection, in any arbitration hereunder in which any claim or the
amount thereof stated in the Officer’s Certificate is at issue, Monaco shall be
deemed to be the Non-Prevailing Party in the event that the arbitrators award
Monaco less than the sum of one half of the disputed amount plus any amounts
not in dispute; otherwise, ORA shall be deemed to be the Non-Prevailing
Party. Each party shall pay its own
expenses and one-half the fees of each arbitrator and the administrative fee of
the American Arbitration Association; provided, however, that the arbitrators
may require the Non-Prevailing Party to pay the expenses, including without
limitation, reasonable attorneys’ fees and costs, incurred by the other party
to the arbitration if the arbitrators find that the arbitration action was
brought or defended other than in good faith and with a reasonable basis in
fact by the Non-Prevailing Party.
7.4 Guaranty. In the event that after the procedures
set forth above have been followed, an Indemnified Party is entitled to
indemnification pursuant to this ARTICLE VII, Monaco may, in its sole
discretion, seek payment of such amount from either ORA pursuant to this
Agreement or from the Principals pursuant to the Guaranty or both, provided
that no Indemnified Party shall be entitled to receive in payment in aggregate
in excess of the amount it is entitled to under this ARTICLE VII.
7.5 Subrogation. In the event ORA pays any
Indemnified Party for Losses pursuant to Section 7.2 in connection
with any third party claim, ORA shall be subrogated to the extent of such
payment to all of the rights of recovery of the Company, Monaco and Buyer,
which shall cooperate with ORA to enable ORA to secure such rights and to
effectively to bring suit to enforce such rights.
7.6 Claims Made by ORA. If ORA brings an
action against Monaco or Buyer relating to (i) the inaccuracy or breach of any
representation or warranty of Monaco and Buyer contained herein or in any
certificate, instrument, or other document delivered pursuant to this
Agreement, subject to Section 7.1, or (ii) a breach of any covenant
or agreement, of Monaco and Buyer contained herein, then ORA may recover from
Monaco or Buyer for any loss, expense, liability or other damage (including
without limitation any liability of ORA or any of its affiliates for expenses
incurred by ORA related to the transactions contemplated hereby), including
reasonable attorney’s fees, arising from (i) or (ii) above; provided, however, that ORA
and its affiliates shall only have the right to such recovery if, and to the
extent that, Monaco’s and Buyer’s aggregate contractual liability under this
Agreement, the ORMCC Agreement and the ORLV Agreement exceeds $250,000. After the Closing, Monaco’s and Buyer’s
aggregate contractual liability under this Agreement, the ORMCC Agreement and
the ORLV Agreement shall not exceed the Indemnification Cap; provided, however,
that nothing herein shall limit any noncontractual remedy for fraud.
43
TERMINATION, AMENDMENT AND WAIVER
8.1 Optional Termination. Except as
provided in Section 8.3 below, this Agreement may be terminated and
the Acquisition abandoned at any time prior to the Closing:
(a) by
mutual consent of ORA and Monaco;
(b) by
Monaco or ORA if: (i) the Closing has
not occurred on or before December 15, 2002; (ii) there shall be a final
nonappealable order of a federal or state court in effect preventing
consummation of the Acquisition; or (iii) there shall be any statute, rule,
regulation or order enacted, promulgated or issued or deemed applicable to the
Acquisition by any Governmental Entity that would make consummation of the
Acquisition illegal;
(c) by
Monaco if there shall be any action taken, or any statute, rule, regulation or
order enacted, promulgated or issued or deemed applicable to the Acquisition by
any Governmental Entity, which would:
(i) prohibit or materially and adversely restrict Buyer’s or the
Company’s ownership or operation of all or a portion of the business of the
Company or (ii) compel Buyer or the Company to dispose of or hold separate all
or a portion of the business or assets of the Company or Buyer as a result of
the Acquisition;
(d) by
Monaco if it is not in material breach of its obligations under this Agreement
and there has been a material breach of any representation, warranty, covenant
or agreement contained in this Agreement on the part of the Company or ORA and
such breach has not been cured within ten (10) business days after written
notice to the Company (provided that no cure period shall be required for a
breach which by its nature cannot be cured);
(e) by
Monaco if there shall have occurred any event or condition of any character
that has had or is reasonably likely to have a material adverse effect on the
business or operations of the Company;
(f) by
the Company or ORA if they are not in material breach of their obligations
under this Agreement and there has been a material breach of any
representation, warranty, covenant or agreement contained in this Agreement on
the part of Monaco and such breach has not been cured within ten (10) business
days after written notice to Monaco (provided that, no cure period shall be
required for a breach which by its nature cannot be cured);
(g) pursuant
to Sections 5.10, 5.11, or 5.12 of this Agreement.
Where action is taken to terminate this Agreement pursuant
to this Section 8.1, it shall be sufficient for such action to be
authorized by the Board of Directors (as applicable) of the party taking such
action.
8.2 Automatic Termination. Except as
provided in Section 8.3 below, this Agreement shall terminate and
the Acquisition shall be abandoned if at any time prior to the Closing either
the
44
ORLV Agreement or the ORMCC Agreement is terminated pursuant to Sections 8.1
of such agreements.
8.3 Effect of Termination. In the event
of termination of this Agreement as provided in Sections 8.1 or 8.2,
this Agreement shall forthwith become void and there shall be no liability or
obligation on the part of Monaco, Buyer, the Company, or ORA, or their
respective officers, directors or shareholders, if applicable, provided that
each party shall remain liable for any breaches of this Agreement prior to its
termination; and provided further that, the provisions of Sections 5.4, 5.5,
5.6, this Section 8.3
and ARTICLE X of this Agreement shall remain in full force and
effect and survive any termination of this Agreement.
8.4 Amendment. Except as may otherwise required by
applicable law after the shareholders of the Company approve this Agreement,
this Agreement may be amended at any time by execution of an instrument in
writing signed by Monaco, Buyer, the Company and ORA.
8.5 Extension; Waiver. At any time prior to
the Closing, Monaco and Buyer, on the one hand, and the Company and ORA, on the
other, may, to the extent legally allowed, (i) extend the time for the
performance of any of the obligations of the other party hereto, (ii) waive any
inaccuracies in the representations and warranties made to such party contained
herein or in any document delivered pursuant hereto, and (iii) waive compliance
with any of the agreements or conditions for the benefit of such party
contained herein. Any agreement on the
part of a party hereto to any such extension or waiver shall be valid only if
set forth in an instrument in writing signed on behalf of such party.
POST-CLOSING COVENANTS
9.1 Sale of the Property by Buyer.
(a) Commercially
Reasonable Efforts. Buyer hereby
covenants to use commercially reasonable efforts to sell the Property (the “Resale”) to A.R.M. pursuant to the A.R.M.
Contract, or if that agreement is terminated, then to any third party on terms
acceptable to Buyer in its sole and absolute discretion.
(b) Profit
Participation. If Buyer sells the
Property, Buyer or Monaco shall pay to ORA upon close of escrow of such Resale
(or if there is no escrow, upon recordation of the deed) (the “Resale Closing Date”) a sum equal to 50% of
the Net Profit. “Net Profit” shall mean all cash proceeds
from the sale of the Property received by Buyer, less:
(i) all
amounts paid by Buyer or Monaco to repay the BankAtlantic Loan (including
accrued interest) and pay off any delinquent taxes and default judgments,
including any prepayment penalties, legal fees, processing fees, recording fees
and any other associated costs;
45
(ii) all
amounts paid by Buyer or Monaco to secure the Replacement Loan, if any,
including legal fees, processing fees, recording fees and any other associated
costs;
(iii) all
interest that has accrued under the Replacement Loan up to and including the
Resale Closing Date;
(iv) all reasonable
overhead costs of Monaco relating to the operation and management of the
Property from the Closing Date to the Resale Closing Date or relating to the Resale;
(v) all amounts
outstanding (including interest) under any other loans to the Company,
including the Monaco Loan, as of the Resale Closing Date;
(vi) all
liabilities incurred or costs paid by the Buyer or Monaco in connection with
the operation of the business of the Company or the Property prior to the
consummation of the Resale, including payment of real estate taxes,
assessments, insurance, permit and land use fees and approvals, attorneys’ fees
and consultants’ fees;
(vii) all amounts paid
to the Robert A. Schoellhorn Trust pursuant to Section 9.1(c);
(viii) all Losses to the
extent that Buyer or Monaco are unable to seek indemnification against ORA
pursuant to Section 7.2(a) due to the fact that the aggregate
amount of Losses is less than $250,000;
(ix) the Closing
Costs;
(x) all Tax
liabilities arising from the sale of the Property and taxes paid by Buyer under
Section 1.7 hereof; and
(xi) all
liabilities incurred or costs paid by the Buyer or Monaco in connection with
the Resale, including broker commissions, transfer taxes, escrow costs, title
costs, survey costs, attorneys’ fees and other closing costs.
Buyer shall have no obligation to pay any amount in
connection with any sale transaction which fails to close (i.e., title is
conveyed to the purchaser) for any reason.
Buyer shall have the right, in its sole and absolute discretion, to
reject any offer to purchase the Property.
(c) Notwithstanding
the foregoing, upon any Resale, the Robert A. Schoellhorn Trust shall receive
payment from the proceeds of the Resale at the Resale Closing Date in the
amount set forth on Schedule 9.1(c), regardless of the amount of
the Net Profit.
(d) Notwithstanding
the foregoing, the payments described in Sections 9.1(b) and (c)
shall be reduced by any amounts to which Monaco is entitled pursuant to Section 7.2
hereof.
(e) Notwithstanding
the foregoing, the Net Profit calculation of Section 9.1(b) shall
not include interest accrued on loans from Monaco to the Company after the
Closing to the
46
extent
that the interest rate on such loans exceeds the greater of (i) Monaco’s
regular corporate funds borrowing rate at the time the loan is made and (ii)
the prime rate at the time the loan is made plus one percent (1%).
9.2 Tax Matters.
(a) Tax
Filing. For purposes of this
Agreement and the filing of applicable Tax Returns, whenever Monaco and ORA
reasonably agree that it is equitable to allocate an item of income, gain,
deduction, loss or credit to either a taxable year or period that ends on or
before the Closing Date or a taxable year or period that begins after the
Closing Date, rules consistent with those in Treasury Regulation Section
1.1502-76(b) will be applied.
(b) Assistance
and Cooperation.
(i) After
the Closing Date, the parties to this Agreement shall (or shall cause their
respective affiliates to):
(A) assist
the other party, to the extent the party providing assistance has pertinent
information, in preparing any Tax Returns which such other party is responsible
for preparing and filing after the Closing Date;
(B) cooperate
fully, to the extent the party providing assistance has pertinent information,
in preparing for any audits of, or disputes with taxing authorities regarding,
any Tax Returns of the Company or its subsidiaries; and
(C) make
available to the other party and to any taxing authority as reasonably
requested all information, records, and documents relating to Taxes of the
Company.
(ii) After
the Closing Date but no later than July 31, 2003, ORA shall (or shall cause its
respective affiliates to) deliver to Monaco a written good faith estimate of
any items (including, but not limited to, net operating losses) to be reported
on ORA’s 2002 federal or state income tax returns, which items would be
required by Monaco in preparing its 2002 federal or state income tax
returns. ORA shall deliver to Monaco a
written final determination of any items reported on such estimate within 30
days after ORA has filed its 2002 federal or state income tax return.
9.3 ORA Additional Cooperation. In
consideration of the profit participation set forth hereinabove (i) ORA agrees
after Closing to provide to Buyer any contacts, inquiries or other
communication received by Buyer in connection with the possible sale of the
Property, or any portion thereof, and (ii) with respect to any letter of
intent, contract, offer or other communication presently in the files of ORA or
the Company or received after Closing, ORA
agrees after Closing to assist Buyer in connection with Buyer’s review,
assessment, negotiation and consummation of any transaction resulting in a
Resale as Buyer may choose to pursue. The profit participation set forth
hereinabove is in consideration of this agreement and undertaking by ORA and
shall not be construed to be a finder’s fee, broker’s fee or similar payment,
such profit participation being part of the consideration for the transactions
contemplated by this Agreement.
47
9.4 Loan Release. Monaco shall use commercially
reasonable efforts following the
Closing Date to obtain a release of the deed of trust securing the BankAtlantic
Loan and a cancellation of the related note and other loan documents.
GENERAL PROVISIONS
10.1 Notices. All notices and other communications hereunder shall be in writing and
shall be deemed given if delivered personally or by commercial delivery
service, or mailed by registered or certified mail (return receipt requested)
or sent via facsimile (with acknowledgment of complete transmission) or sent
via electronic mail (with electronic acknowledgement of receipt) to the parties
at the following addresses (or at such other address for a party as shall be
specified by like notice):
(a) if
to Monaco or Buyer, or to the Company after the Closing, to: Monaco Coach Corporation, 91320 Industrial
Way, Coburg, Oregon 97408, Attention:
Controller, Tel: (541) 686-8011, Fax: (541) 302-3800, and to Monaco Coach
Corporation, Indiana Operations, 606 Nelson’s Parkway, Wakarusa, IN 46573,
Attention: General Counsel, Tel (800)
650-7337, Fax: (219) 293-1528.
with a copy to: Wilson
Sonsini Goodrich & Rosati, Professional Corporation,650 Page Mill Road,
Palo Alto, California 94304-1050, Attention: Henry P. Massey, Jr., Esq., Tel:
650-493-9300, Fax: 650-493-6811.
(b) if
to ORA, or to the Company up to and including the Closing, to: Robert A. Schoellhorn, President, Marathon
Coach, Inc., 91333 Coburg Industrial Way, Coburg, OR 97408-9432, Tel: (541)
343-9991, Fax: (541) 343-2401.
with a copy to: Stephen
M. Alderman, Garfield & Merel, Ltd., 223 West Jackson Blvd., Suite 1010,
Chicago, IL 60606, Tel: (312) 583-1600, Fax: (312) 583-1700.
(c) if
to a Principal, to the address for notice set forth on the signature page
to the Affiliates Agreement.
with a copy to: Daniel D.
Drew, Tribler, Orpett & Crone, 30 North La Salle Street, Chicago, IL 60602,
Tel: (312) 201-6414, Fax: (312) 201-6401.
10.2 Headings. The table of contents and headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.
48
10.3 Counterparts. This Agreement may be executed
in one or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other party, it being
understood that all parties need not sign the same counterpart.
10.4 Entire Agreement. This Agreement, the
Schedules and Exhibits hereto, and the documents and instruments and other
agreements among the parties hereto referenced herein: (a) constitute the
entire agreement among the parties with respect to the subject matter hereof
and supersede all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof, including without
limitation the agreement in principal among certain of the parties hereto dated
July 24, 2002.
10.5 Assignment. No party may assign or delegate
either this Agreement or any of its rights, interests, or obligations hereunder
without the prior written approval of the other parties. Subject to the immediately preceding sentence,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
Notwithstanding the foregoing, Buyer may assign its rights under this Agreement
without the consent of the Company or ORA provided the assignee assumes in
writing all obligations and liabilities of Buyer, in which event Buyer but not
Monaco shall be relieved of any further liability hereunder.
10.6 Severability. In the event that any
provision of this Agreement or the application thereof, becomes or is declared
by a court of competent jurisdiction to be illegal, void or unenforceable, the
remainder of this Agreement will continue in full force and effect and the
application of such provision to other Persons or circumstances will be
interpreted so as reasonably to effect the intent of the parties hereto. The parties further agree to replace such
void or unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the economic, business and
other purposes of such void or unenforceable provision.
10.7 Other Remedies. Except as otherwise
provided herein, any and all remedies herein expressly conferred upon a party
will be deemed cumulative with and not exclusive of any other remedy conferred
hereby, or by law or equity upon such party, and the exercise by a party of any
one remedy will not preclude the exercise of any other remedy.
10.8 No Third Party Beneficiaries.
This Agreement is solely for the benefit of (a) Monaco and Buyer and its
successors and permitted assigns with respect to the obligations of the
Company, and ORA under this Agreement and (b) the Company and ORA, and
their respective successors and permitted assigns with respect to the
obligations of Monaco and Buyer under this Agreement. This Agreement shall not be deemed to confer upon or give to any
other third party any remedy, claim, right to reimbursement, cause of action or
other right, unless expressly provided for in this Agreement.
10.9 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of Oregon,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof.
49
10.10 Specific Performance. The parties
agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached.
It is accordingly agreed that either party shall be entitled to seek an
injunction or injunctions or other equitable relief to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction over the dispute.
50
IN WITNESS WHEREOF, Monaco, Buyer, the Company and ORA
have executed this Agreement as of the date first written above.
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MONACO COACH CORPORATION
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MCC ACQUISITION CORPORATION
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By:
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/s/ John W. Nepute
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By:
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/s/ John W. Nepute
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John W. Nepute,
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John W. Nepute,
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President
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Vice President
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OUTDOOR RESORTS OF AMERICA, INC.
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By:
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/s/ E. Randall
Henderson
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E. Randall Henderson,
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President
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OUTDOOR RESORTS OF NAPLES, INC.
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By:
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/s/ E. Randall
Henderson
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E. Randall Henderson,
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President
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[SIGNATURE PAGE TO ORN STOCK PURCHASE AGREEMENT]
With respect to the following pages, the
Company has omitted the listed exhibits, but agrees to furnish supplementally a
copy of the exhibit to the Commission upon request.
EXHIBIT A
FORM OF GUARANTY
i
EXHIBIT B
FORM OF
AFFILIATES AGREEMENT
ii
EXHIBIT C
DESCRIPTION OF LAND
iii
EXHIBIT D
FORM OF OPINION OF SOPER &
OAKLEY, PLLC
iv
EXHIBIT
E
FORM OF
OPINION OF
TRIBLER ORPETT & CRONE, PROFESSIONAL CORPORATION
v
EXHIBIT
F
FORM OF
OPINION OF
CRARY, BUCHANAN, BOWDISH, BOVIE, BERES,
NEGRON & THOMAS
vi