SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) - March 2, 1998
FLORIDA PANTHERS HOLDINGS, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-13173 65-0676005
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(State or Other Jurisdiction of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
450 East Las Olas Boulevard, Fort Lauderdale, Florida 33301
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(Address of Principal Executive Offices) (Zip Code)
(954) 712-1300
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(Registrants Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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Item 2. Acquisition or Disposition of Assets.
On March 2, 1998, Florida Panthers Holdings, Inc. (the "Company")
acquired a controlling ownership interest in the Arizona Biltmore Hotel
("Arizona Biltmore") pursuant to a contribution and exchange agreement, dated as
of December 19, 1997 (the "Contribution and Exchange Agreement"), by and among
the Company, Biltmore Hotel Partners, AZB Limited Partnership, W&S Realty
Investment Group L.L.C., Samuel Grossman, Charles Carlise, W. Matthew Crow, AZ
Biltmore Hotel Limited Partnership, Southwest Associates, El Camino Associates,
Grossman Investment Corp., and The Crow Irrevocable Trust.
The consideration paid by the Company to the sellers for their
ownership interests in the Arizona Biltmore as set forth in the Contribution and
Exchange Agreement includes: (i) warrants to purchase 500,000 shares of the
Company's Class A common stock, par value $ .01 per share, (the "Class A Common
Stock") exercisable at $24.00 per share, (ii) the assumption of $63.4 million of
debt, (iii) payment of $126 million in cash at closing and (iv) payment of $100
million with interest at a rate of 5% per annum which is payable at the election
of the seller, either in cash at any time from September 2, 1998 through March
2, 2000 or in shares of Class A Common Stock at a per share price of $26.00 at
any time from March 2, 1998 through March 2, 2008.
The transaction will be accounted for under the purchase method of
accounting. The description of the acquisition contained herein is qualified in
its entirety by reference to the Contribution and Exchange Agreement and the
press release which are attached hereto as Exhibits 10.1 and 99.1, respectively,
and which are incorporated herein by reference.
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Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(a) Financial Statements of Business Acquired
In accordance with Item 7(a)(4) of Form 8-K,
financial statements of the business acquired shall
be provided pursuant to an Amendment to this Form 8-K
no later than May 16, 1998, unless "previously
reported", as such term is defined in Rule 12b-2 of
the Securities Exchange Act of 1934.
(b) Pro Forma Financial Information
Pro forma financial information shall be provided
pursuant to an Amendment to this Form 8-K no later
than May 16, 1998, unless "previously reported", as
such term is defined in Rule 12b-2 of the Securities
Exchange Act of 1934.
(c) Exhibits
Exhibit No. Description
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10.1 Contribution and Exchange Agreement
dated December 19, 1997 by and among
Florida Panthers Holdings, Inc.,
Wright-Bilt Corp., Biltmore Hotel
Partners, AZB Limited Partnership, W&S
Realty Investment Group L.L.C.,
Samuel Grossman, Charles Carlise, W.
Matthew Crow, AZ Biltmore Hotel
Limited Partnership, Southwest
Associates, El Camino Associates,
Grossman Investment Corp., and The
Crow Irrevocable Trust.
99.1 Press release dated March 3, 1998
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FLORIDA PANTHERS HOLDINGS, INC.
Date: March 5, 1998 By: WILLIAM M. PIERCE
William M. Pierce
Senior Vice President, Treasurer
and Chief Financial Officer
EXHIBIT 10.1
CONTRIBUTION AND EXCHANGE AGREEMENT
(ARIZONA BILTMORE HOTEL)
This Contribution and Exchange Agreement (this "Agreement") is
entered into as of December 19, 1997 by and among Florida Panthers Holdings,
Inc., a Delaware corporation ("Panthers"); Wright-Bilt Corp., a Delaware
corporation ("Panthers SPE"); Biltmore Hotel Partners, an Arizona general
partnership ("Partnership"); AZB Limited Partnership a Delaware limited
partnership and a general partner of the Partnership ("AZB"); W&S Realty
Investment Group, L.L.C. an Arizona limited liability company and a general
partner of the Partnership ("W&S"); Samuel Grossman ("Grossman"); Charles
Carlise ("Carlise"); W. Matthew Crow ("Crow"); AZ Biltmore Hotel Limited
Partnership, a Delaware limited Partnership ("AZ"); Southwest Associates, an
Illinois general partnership ("SW"); El Camino Associates, an Arizona general
partnership ("EC"); Grossman Investment Corp., an Arizona corporation ("GIC")
and The Crow Irrevocable Trust, under a trust agreement effective January 1,
1994 ("CIT"). AZB and W&S are collectively referred to herein as the "Exchange
Partners", and AZ, EC, SW, GIC, CIT, Grossman, Carlise and Crow are collectively
referred to as the "Partners".
RECITALS
The Board of Directors of Panthers has determined that it is in the
best interests of Panthers and its shareholders for Panthers to acquire,
directly or indirectly, certain interests of the Partnership, which owns or
holds other interests in certain real property located in Maricopa County
Arizona, which is described on Schedule A hereto together with improvements
thereon or interests therein, all of which together are known as the Arizona
Biltmore Hotel (the "Resort"), and the Exchange Partners have determined on
behalf of the Partnership that it is in the best interests of the Partnership to
issue certain partnership interests to Panthers SPE as provided herein.
TERMS OF AGREEMENT
In consideration of the mutual representations, warranties, covenants
and agreements contained herein, the parties hereto agree as follows:
ARTICLE I
THE TRANSACTION
1.1 General Description of Transaction. Subject to the terms and
conditions of this Agreement, at the Effective Time (as defined below), (i)
Panthers SPE shall transfer the Exchange Consideration (as defined below) to the
Exchange Partners in exchange for a portion of their interests in the
Partnership, (ii) Panthers SPE shall be admitted as a general partner of the
Partnership; (iii) AZB, W&S and Panthers SPE shall enter into the Limited
Partnership Agreement; and (iv) the parties shall enter into the closing
documents described in Article VI (the "Closing Documents").
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1.2 The Closing. Subject to the terms and conditions of this Agreement,
the consummation of the transactions contemplated hereunder ("Closing" or the
"Effective Time") shall take place at 10:00 a.m. M.S.T. on February 16, 1998, or
at the election of Panthers for any reason set forth in Schedule 1.2, March 2,
1998, or such later date to which the Closing may be extended pursuant to this
Agreement, at the offices of the Partnership's counsel, Fennemore Craig, in
Phoenix, Arizona, or such other time, date or place as all of the parties may
agree. The date on which the Closing occurs is hereinafter referred to as the
Closing Date.
1.3 Conversion to Limited Liability Partnership and Restatement of
Partnership Agreement. On the Closing Date, the parties agree that the
Partnership shall convert to and continue as a limited liability limited
partnership and that the Agreement of Partnership of Biltmore Hotel Partners
dated as of June 8, 1992, as amended by that certain First Amendment to the
Agreement of Partnership of Biltmore Hotel Partners dated as of May 12, 1994
(the "Partnership Agreement") between AZB and W&S shall be restated as a Limited
Partnership Agreement, the form of which is provided at Schedule 1.3 (the
"Limited Partnership Agreement").
1.4 Exchange Consideration. The aggregate exchange consideration
("Exchange Consideration") to be delivered by Panthers SPE in exchange for the
Class A Units shall be (i) One Hundred and Twenty-Five Million Seven Hundred
Eighty-Seven Thousand Six Hundred Fifty Dollars ($125,787,650.00) (the "Cash
Consideration") delivered in immediately available funds on the Closing Date as
directed by AZB and W&S in accordance with the Limited Partnership Agreement;
and (ii) warrants to acquire 500,000 shares of Panthers Common Stock (the
"Warrants") pursuant to the terms of a Warrant Agreement in the form attached
hereto as Schedule 1.4 (the "Warrant Agreement"), which shall be distributed as
directed by AZB and W&S in accordance with the Limited Partnership Agreement.
Certain Units (as defined in the Limited Partnership Agreement) shall be subject
to Hold Back and Setoff rights as described in Article VIII. If the Renovation
(as defined in the Limited Partnership Agreement), has, at the time of Closing,
received site plan approval by the City of Phoenix, Panthers SPE shall also pay
the Renovation Contribution (as defined in Section 5.20) to the Partnership in
immediately available funds at Closing. If the Closing Date occurs after
February 16, 1998, the Cash Consideration shall be increased by the product of
Seventeen Thousand One Hundred Twenty-Five Dollars ($17,125.00) multiplied by
the number of days which elapse between February 16, 1998 and the Closing Date.
In addition, the parties shall execute and deliver the Closing Documents in
accordance with Article VI.
1.5 Filing of Documents. At the time of the Closing, the parties shall
cause to be filed with the Secretary of State of the State of Arizona a
Certificate of Limited Partnership and any other documents necessary to convert
the Partnership to a limited liability limited partnership, and a statement of
qualification as a limited liability limited partnership in accordance with
A.R.S. Section 29.1101. In addition, Panthers, Panthers SPE or the Exchange
Partners shall file such further documents with the Arizona Secretary of State
as they reasonably deem necessary or advisable in connection with the operation
of the Partnership.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF PANTHERS
As a material inducement to the Partnership, the Exchange Partners and
the Partners to enter into this Agreement and to consummate the transactions
contemplated hereby, Panthers and Panthers SPE make the following
representations and warranties to the Partnership, the Exchange Partners and the
Partners which are set forth in this Article II. The Partnership, Exchange
Partners and Partners hereby expressly acknowledge and agree that, except as set
forth herein they have not received or relied upon, and except as will be set
forth in the certificates which will be delivered at Closing pursuant to Section
6.6, they will not receive or rely upon, and neither the Panthers nor Panthers
SPE shall have any liability or responsibility for, any other representation or
warranty.
2.1 Corporate Status. Panthers is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. Panthers
has the requisite power and authority to own or lease its properties and to
carry on its business as now being conducted. Panthers SPE is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Panthers SPE has the requisite power and authority to own or lease its
properties and to carry on its business as now being conducted. Panthers is and
Panthers SPE shall be at the time of Closing legally qualified to transact its
business as a foreign corporation in all jurisdictions where the nature of its
properties and the conduct of its businesses requires such qualification (all of
which jurisdictions are listed separately for each corporation on Schedule 2.1)
and (to the extent applicable under governing law) is in good standing in each
of the jurisdictions in which it is so qualified. No attachments, execution
proceedings, assignments for the benefit of creditors, insolvency, bankruptcy or
other similar legal proceedings are pending or, to the knowledge of Panthers and
Panthers SPE, threatened against them, nor are any such proceedings contemplated
by them. Neither Panthers nor Panthers SPE has ever been a debtor under any case
commenced under the United States Bankruptcy Code.
2.2 Power and Authority. Panthers and Panthers SPE each has the power
and authority to execute and deliver this Agreement and the other documents and
instruments to be executed by it hereunder, to perform its respective
obligations hereunder and to consummate the transactions contemplated hereby.
Each of Panthers and Panthers SPE has taken all action necessary to authorize
the execution and delivery of this Agreement and the other documents and
instruments to be executed and delivered by it pursuant hereto, and the
performance of its respective obligations hereunder and thereunder and the
consummation of the transactions contemplated hereby and thereby.
2.3 Enforceability. This Agreement and the other documents and
instruments to be executed by them hereunder have been duly executed and
delivered by each of Panthers and Panthers SPE and constitute legal, valid and
binding obligations of each of them, enforceable against each of them in
accordance with their terms, except as the same may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and general equitable principles
regardless of whether such enforceability is considered in a proceeding at law
or in equity.
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2.4 Exchanged Securities/Panthers Common Stock. Upon consummation of
the transactions contemplated hereunder, the Exchange Agreements will each be
validly issued. Upon exercise of any rights to redeem Class B Units, Class C
Units or Class E Units for Panthers Common Stock, and the issuance and delivery
of certificates representing the Panthers Common Stock to the holders of such
Units, the Panthers Common Stock will be validly issued, fully paid and
non-assessable shares of Panthers Common Stock. Upon exercise of the Warrants,
and payment of the exercise price with respect thereto, the shares of Panthers
Common Stock issued thereunder will be validly issued, fully paid and
non-assessable. As of November 26,1997 there were 34,850,974 shares of Panthers
Class A common stock, par value $.01 per share ("Panthers Common Stock") issued
and outstanding, all of which were duly authorized, validly issued in compliance
with the Securities Laws and fully paid and non-assessable. Panthers has
reserved sufficient shares of Panthers Common Stock for issuance to the Holders
thereof upon exercise of the Warrants and the Class B Units and to the extent
necessary will reserve sufficient shares of Panthers Common Stock for issuance
to the Holders thereof upon the exercise of the Class C Units and Class E Units.
2.5 SEC Filing, Other Filings and NYSE Compliance. Since November 8,
1996, Panthers has made all filings required to be made by it under the
Securities Act and the Exchange Act, and any rules and regulations promulgated
thereunder (the "SEC Filings") and pursuant to any other Requirements of Law
(the "Other Filings"). The SEC Filings and the Other Filings, when filed,
complied in all material respects with all applicable requirements of the
Securities Act, the Exchange Act and other Requirements of Law. None of the SEC
Filings or the Other Filings, at the time of filing, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading in light of the circumstances in which they were made. To the extent
requested by the Partners in writing, Panthers has delivered or made accessible
to the Partners' designated representatives true, accurate and complete copies
of the SEC Filings which were filed with the SEC since November 8, 1996.
Panthers has taken all necessary actions to ensure its continued inclusion in,
and the continued eligibility of the Common Stock for trading on, the New York
Stock Exchange under all currently effective and currently proposed inclusion
requirements. Each balance sheet included in the SEC Filings (including any
related notes and schedules) fairly presents in all material respects the
consolidated financial position of Panthers and its subsidiaries as of its date,
and each of the other financial statements included in the SEC Filings
(including any related notes and schedules) fairly presents in all material
respects the consolidated results of operations or other information therein of
the Panthers and its subsidiaries for the periods or as of the dates therein set
forth in accordance with GAAP consistently applied during the periods involved
(except that the interim reports are subject to adjustments which might be
required as a result of year end audit and except as otherwise stated therein).
Until Closing, Panthers will continue to make all required SEC Filings on a
timely basis. The current capitalization of Panthers is as set forth in its Form
8-K dated November 17, 1997. Panthers has furnished to the Exchange Partners
true, correct and complete copies of its Certificate of Incorporation and bylaws
as amended and in effect on the date hereof.
<PAGE>
2.6 No Commissions. Panthers has not incurred any obligation for any
finder's or broker's or agent's fees or commissions or similar compensation in
connection with the transactions contemplated hereby.
2.7 No Violation. The execution and delivery of this Agreement by each
of Panthers and Panthers SPE and the performance by them of their respective
obligations hereunder and the consummation by each of them of the transactions
contemplated by this Agreement will not: (a) contravene any provision of the
Certificate of Incorporation or Bylaws of Panthers or of Panthers SPE; (b)
violate or conflict with any law, statute, ordinance, rule, regulation, decree,
writ, injunction, judgment or order of any Governmental Authority or of any
arbitration award which is either applicable to, binding upon or enforceable
against Panthers or Panthers SPE; (c) conflict with, result in any breach of, or
constitute a default (or an event which would, with the passage of time or the
giving of notice or both, constitute a default) under, or give rise to a right
to terminate, amend, modify, abandon or accelerate, any material Contract which
is applicable to, binding upon or enforceable against Panthers, Panthers SPE or
any material direct or indirect subsidiary of Panthers; or (d) require the
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Authority, any court or tribunal or any other Person,
except any applicable filings required under the HSR Act, any SEC Filings
required to be made by Panthers and state filings contemplated hereby.
2.8 Principal Places Of Business. The principal place of
business of each of Panthers and Panthers SPE is 450 East Las Olas Blvd.,
Fort Lauderdale, Florida 33301.
2.9 Litigation. Except as set forth in Panthers SEC Filings, there is
no action, suit or other legal or administrative proceeding or governmental
investigation pending, or to the knowledge of Panthers or Panthers SPE
threatened, by or against Panthers or Panthers SPE or affecting Panthers or
Panthers SPE or their properties or assets which in the aggregate would have a
Material Adverse Effect thereon or which questions the validity or
enforceability of this Agreement or the transactions contemplated hereby.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE
PARTNERSHIP, THE EXCHANGE PARTNERS
AND THE PARTNERS
As a material inducement to each of Panthers and Panthers SPE to enter
into this Agreement and to consummate the transactions contemplated hereby, each
of AZB and W&S, jointly and severally, and the Partners severally makes the
representations and warranties to Panthers and Panthers SPE which are set forth
in this Article III. Notwithstanding any other provision hereof to the contrary,
the representations and warranties of each Partner are limited to matters
pertaining to such Partner and to the Exchange Partners and the Partnership and
shall not be deemed to include or pertain to any other Partner. Panthers and
Panthers SPE hereby expressly acknowledge and agree that, except as set forth
herein, they have not received or relied upon, and except as will be set forth
in the certificates which are to be delivered at Closing pursuant to Section
6.5, they shall not receive or rely upon, and none of the Partnership, the
Exchange Partners or the Partners shall have any liability or responsibility
for, any other representation or warranty.
<PAGE>
3.1 Partnership Status.
(a) The Partnership is a general partnership duly organized
and validly existing under the laws of the State of Arizona and has the
requisite power and authority to own or lease its properties and to carry on its
business as now being conducted. The Partnership is not legally required to
qualify to transact business as a foreign partnership in any jurisdiction. No
attachments, execution proceedings, assignments for the benefit of creditors,
insolvency, bankruptcy, dissolution or other similar legal proceedings are
pending or, to the Partnership's, the Exchange Partners' and the Partner's
Knowledge, threatened against them, nor are any such proceedings contemplated by
them. The Partnership has never been a debtor under any case commenced under the
United States Bankruptcy Code.
(b) AZB is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware. W&S is a
limited liability company duly organized, validly existing and in good standing
under the laws of the State of Arizona. Each of AZB and W&S has the requisite
power and authority to own or lease its properties and to carry on its business
as it is now being conducted. AZB is legally qualified to transact business as a
foreign limited partnership in the State of Arizona and is not legally required
to do so in any other jurisdiction. W&S is not legally required to qualify to
transact business as a foreign limited liability company in any jurisdiction.
(c) Desert Jewel Destinations, L.L.C. (the "Subsidiary") is a
limited liability company duly organized, validly existing and in good standing
under the laws of the State of Arizona, has the requisite power and authority to
own and lease its properties and to carry on its business as it is now being
conducted, is not required to qualify to transact business as a foreign limited
liability company in any jurisdiction and all of its outstanding membership
interests are owned by the Partnership.
3.2 Power and Authority. Each of the Partnership, the Exchange Partners
and the Partners has the requisite power, authority and competence to execute
and deliver this Agreement and the other documents and instruments to be
executed by it hereunder, to perform its obligations hereunder and to consummate
the transactions contemplated hereby and thereby. Each of the Partnership, the
Exchange Partners and the Partners has taken all action necessary to authorize
the execution and delivery of this Agreement and the other documents and
instruments to be executed and delivered by the Partnership, the Exchange
Partners and the Partners pursuant hereto, the performance of its obligations
hereunder and thereunder and the consummation of the transactions contemplated
hereby and thereby.
3.3 Enforceability. This Agreement and the other documents and
instruments to be executed by them hereunder have been duly executed and
delivered by the Partnership, the Exchange Partners and each of the Partners and
constitute legal, valid and binding obligations of each of them, enforceable
against each of them in accordance with their terms, except as the same may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and
general equitable principles regardless of whether such enforceability is
considered in a proceeding at law or in equity.
<PAGE>
3.4 Capitalization; Ownership.
(a) The record and beneficial owners of all the outstanding
partnership interests of the Partnership are set forth on Schedule 3.4(a) and
are free of all liens and encumbrances except as set forth on Schedule 3.4 (a).
(b) The record and beneficial owners of all the outstanding
partnership interests of AZB are set forth on Schedule 3.4(b).
(c) The record and beneficial owners of all the outstanding
membership interest of W&S are set forth on Schedule 3.4(c).
3.5 No Violation. Except as set forth on Schedule 3.5, the execution
and delivery of this Agreement by the Partnership, the Exchange Partners and the
Partners, the performance by them of their respective obligations hereunder and
the consummation by them of the transactions contemplated by this Agreement will
not (i) contravene any provision of the Partnership Agreement, Operating
Agreement or other organizational documents of the Partnership, the Exchange
Partners and the Partners, (ii) violate or conflict with any law, statute,
ordinance, rule, regulation, decree, writ, injunction, judgment or order of any
Governmental Authority or of any arbitration award which is either applicable
to, binding upon or enforceable against the Partnership, the Exchange Partners
and the Partners, (iii) conflict with, result in any breach of, or constitute a
default (or an event which would, with the passage of time or the giving of
notice or both, constitute a default) under, or give rise to a right to
terminate, amend, modify, abandon or accelerate, any Designated Contract which
is applicable to, binding upon or enforceable against the Partnership, the
Exchange Partners and the Partners, (iv) result in or require the creation or
imposition of any Lien upon or with respect to any of the property, assets or
the issued and outstanding interests of the Partnership or the Subsidiary, or
(v) require the consent, approval, authorization or permit of, or filing with or
notification to, any Governmental Authority, any court or tribunal or any other
Person, except any applicable filings required under the HSR Act, any SEC
Filings required to be made by Panthers, the Exchange Partners or the Partners
and state filings contemplated hereby.
3.6 Records of the Partnership. The copies of the Partnership Agreement
between Aoki Realty Corporation of America and AZB dated June 8, 1992 as amended
by that certain First Amendment of Partnership dated May 12, 1994 and other
organizational documents of the Partnership which were provided to Panthers are
true, accurate and complete and reflect all amendments made through the date of
this Agreement. All actions taken by the Partnership and the Exchange Partners
with respect to the Partnership, have been duly authorized or ratified.
3.7 Subsidiaries. Except as set forth on Schedule 3.7, the Partnership
does not own, directly or indirectly, any outstanding voting securities of or
other interests in, or control, any other corporation, partnership, joint
venture or other business entity.
<PAGE>
3.8 Financial Statements. The Exchange Partners have delivered to
Panthers the financial statements of the Partnership and the Subsidiary (which
are consolidated therein), consisting of balance sheets and related statements
of income and cash flows and notes thereto described as follows: (i) for the
years ended December 31, 1995 and 1996 as set forth in Schedule 3.8 (the
"Audited Statements"); and (ii) interim unaudited financial statements of the
Partnership for the ten months ended October 31, 1997 (the "Interim
Statements"). The Interim Statements together with the Audited Statements are
collectively referred to as the "Financial Statements". A copy of the Interim
Statements is attached to Schedule 3.8 hereto. The Financial Statements fairly
present in all material respects the financial position of the Partnership and
the Subsidiary at each of the balance sheet dates and the results of operations
of the Partnership and the Subsidiary for the periods covered thereby. The
Audited Statements have been prepared in accordance with GAAP consistently
applied throughout the periods indicated, except as otherwise indicated therein
or in the notes thereto. The Interim Statements have been prepared in accordance
with GAAP except for normal year-end audit adjustments, the absence of footnotes
and as set forth on Schedule 3.8. Except as set forth on Schedule 3.8, or as
specifically disclosed therein or in the notes thereto, there are no material
special or nonrecurring items of income or expense during the periods covered by
the Financial Statements, and the balance sheets included in the Financial
Statements do not reflect any writeup or revaluation increasing the book value
of any assets.
3.9 Changes Since the Interim Statements. Except as set forth on
Schedule 3.9, and other than in the ordinary course of business consistent with
past practice, since the date of the Interim Statements, each of the Partnership
and the Subsidiary has not: (i) paid any bonus to or increased the rate of
compensation of any of its officers or salaried employees or amended any other
terms of employment of such persons; (ii) sold, leased or transferred any of its
properties or assets; (iii) made or obligated itself to make capital
expenditures; (iv) made any payment in respect of its liabilities; (v) incurred
any obligations or liabilities (including any indebtedness) or entered into any
transaction or series of transactions involving in excess of $50,000 in the
aggregate, except for this Agreement and the transactions contemplated hereby;
(vi) suffered any theft, damage, destruction or casualty loss, not covered by
insurance and for which a timely claim was filed, in excess of $50,000 in the
aggregate; (vii) suffered any extraordinary losses (whether or not covered by
insurance); (viii) waived, canceled, compromised or released any rights having a
value in excess of $50,000 in the aggregate; (ix) made or adopted any change in
its accounting practice or policies; (x) made any adjustment to its books and
records other than in respect of the conduct of its business activities; (xi)
entered into any transaction with any Affiliate; (xii) entered into, terminated,
amended or modified any Designated Contract; (xiii) imposed any security
interest or other Lien on any of its assets; (xiv) delayed paying any accounts
payable which are due and payable except to the extent being contested in good
faith; (xv) made or pledged any charitable contribution; or (xvi) agreed to do
or authorized any of the foregoing. Except as set forth on Schedule 3.9, since
the date of the Interim Statements, the Partnership has not made or adopted any
changes in its accounting practices or policies.
3.10 Liabilities. Except as set forth on Schedule 3.10, neither the
Partnership nor the Subsidiary has any liabilities or obligations, whether
accrued, absolute, contingent or otherwise, except (a) to the extent reflected
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or taken into account in its Financial Statements and not heretofore paid or
discharged, (b) to the extent specifically set forth in or incorporated by
express reference in any of the Schedules attached hereto, (c) liabilities
incurred in the ordinary course of business consistent with past practice since
the date of its Interim Statements (none of which relates to breach of contract,
breach of warranty, tort, infringement or violation of law, or which arose out
of any action, suit, claim, governmental investigation or arbitration
proceeding), (d) normal accruals, reclassifications, and audit adjustments which
would be reflected on an audited financial statement and (e) liabilities
incurred in the ordinary course of business. Schedule 3.10 describes all
indebtedness for borrowed money of the Partnership and the Subsidiary. On the
Closing Date, the existing Deed of Trust dated June 4, 1996, securing four
promissory notes from American General Life Insurance Company, the Variable
Annuity Life Insurance Company, the Franklin Life Insurance Company and American
General Life and Accident Insurance Company (the "Debt Facility") will have a
principal balance which does not exceed Sixty Three Million, Three Hundred Fifty
Thousand Dollars ($63,350,000.00) in the aggregate.
3.11 Litigation. Except as set forth on Schedule 3.11, there is no
action, suit or other legal or administrative proceeding or governmental
investigation pending, or to the Knowledge of the Partnership threatened, by or
against the Partnership or the Subsidiary or affecting the Partnership, the
Subsidiary or the Exchange Partners or any of their properties or assets or
which questions the validity or enforceability of this Agreement or the
transactions contemplated hereby. There is no action suit or other legal or
administrative proceeding or governmental investigation pending, or to the
Knowledge of the Partners, threatened against the Partners which questions the
validity or enforceability of this Agreement or the transaction contemplated
hereby. There are no outstanding orders or decrees issued by any Governmental
Authority in any proceeding to which the Partnership, the Subsidiary or any
Exchange Partner is or was a party which have not been complied with in full.
3.12 Environmental Matters.
(a) Except as set forth on Schedule 3.12 or Disclosed (as
hereinafter defined) in the items listed thereon, the Partnership is and has,
and to the Knowledge of the Partnership all prior owners and operators of the
Owned Properties have, at all times been in full compliance with all
Environmental Laws (as defined in clause (e) below) governing its business,
operations, properties and assets, including, without limitation: (i) all
requirements relating to the Discharge (as defined in clause (e) below) and
Handling (as defined in clause (e) below) of Hazardous Substances (as defined in
clause (e) below) or other Waste (as defined in clause (e) below); (ii) all
requirements relating to notice, record keeping and reporting; (iii) all
requirements relating to obtaining and maintaining Licenses (as defined in
clause (e) below) for the ownership of its properties and assets and the
operation of its business, including Licenses relating to the Handling and
Discharge of Hazardous Substances and other Waste; and (iv) all applicable
writs, orders, judgments, injunctions, governmental communications, decrees,
informational requests or demands issued pursuant to, or arising under, any
Environmental Laws.
(b) (i) Except as set forth on Schedule 3.12 or Disclosed in
the items listed thereon, there are no non-compliance orders, warning letters or
notices of violation (collectively "Notices"), claims, suits, actions,
judgments, penalties, fines, or administrative or judicial investigations or
proceedings (collectively "Proceedings") pending or, to the Knowledge of the
<PAGE>
Partnership, threatened against or involving the Partnership, or its business,
operations, properties, or assets, issued by any Governmental Authority or third
party with respect to any Environmental Laws or Licenses issued thereunder in
connection with, related to or arising out of the ownership of the Partnership's
properties or assets or the operation of its business, which have not been
resolved to the satisfaction of the issuing Governmental Authority or third
party in a manner that would not impose any obligation, burden or continuing
liability on Panthers (collectively, "Environmental Liability") in the event
that the transactions contemplated by this Agreement are consummated, or which
could have a Material Adverse Effect on the Partnership. This provision (b)(i)
is not intended to and does not apply to any Notices or Proceedings for any
Environmental Liability based on or arising as a result of events, circumstances
or actions that occurred prior to the ownership and operation of the Owned
Properties by the Partnership.
(b) (ii) Except as set forth on Schedule 3.12 or Disclosed in
the items listed thereon, and to the Knowledge of the Partnership, there are no
Notices or Proceedings pending or threatened against or involving the
Partnership, or its business, operations, properties or assets, issued by any
Governmental Authority or third party with respect to any Environmental Laws or
Licenses issued thereunder in connection with, related to or arising out of the
ownership or operation of the Owned Properties by prior owners or operators,
which have not been resolved to the satisfaction of the issuing Governmental
Authority or third party in a manner that would not impose any Environmental
Liability on Panthers in the event that the transactions contemplated by this
Agreement are consummated.
(c) Except as set forth on Schedule 3.12 or Disclosed in the
items listed thereon, the Partnership does not use, nor has it used, any
Aboveground Storage Tanks (as defined in clause (e) below) or Underground
Storage Tanks (as defined in clause (e) below), and there are not now nor to the
Knowledge of the Partnership have there ever been any Underground Storage Tanks
beneath any of the Owned Properties that are required to be registered under
applicable Environmental Laws.
(d) In addition to the items disclosed pursuant to clauses
(a), (b) and (c) above, Schedule 3.12 identifies (i) all environmental audits,
assessments or occupational health studies undertaken by the Partnership or its
agents or, to the Knowledge of the Partnership, undertaken by any Governmental
Authority or any third party, relating to or affecting the Partnership or any of
the Owned Properties; (ii) the results of any ground water, soil, air or
asbestos monitoring undertaken by the Partnership or its agents or, to the
Knowledge of the Partnership, undertaken by any Governmental Authority or any
third party, relating to or affecting the Partnership or any of the Owned
Properties which indicate the presence of Hazardous Substances at levels
requiring a notice or report to be made to a Governmental Authority or in
violation of any applicable Environmental Laws; and (iii) all outstanding
citations issued under OSHA, or similar state or local statutes, laws,
ordinances, codes, rules, regulations, orders, rulings, or decrees, relating to
or affecting the Partnership or any of the Owned Properties.
(e) For purposes of this Section 3.12, the following terms
shall have the meanings ascribed to them below:
<PAGE>
"Aboveground Storage Tank" shall have the meaning ascribed to
such term in Section 6901 et seq., as amended, of RCRA, or any
applicable state or local statute, law, ordinance, code, rule,
regulation, order ruling, or decree governing Aboveground Storage
Tanks.
"Discharge" means any manner of spilling, leaking, dumping,
discharging, releasing or emitting, as any of such terms are defined in
any Environmental Law, into any medium including, without limitation,
ground water, surface water, soil or air.
"Disclosed" means any matter stated on the face of any writing
the meaning or import of which is readily apparent to an environmental
consultant.
"Environmental Laws" means all federal, state, regional or
local statutes, laws, rules, regulations, codes, orders, plans,
injunctions, decrees, rulings, and changes or ordinances or judicial or
administrative interpretations thereof, any of which govern or relate
to pollution, protection of the environment, public health and safety,
air emissions, water discharges, hazardous or toxic substances, solid
or hazardous waste or occupational health and safety, as any of these
terms are defined in such statutes, laws, rules, regulations, codes,
orders, plans, injunctions, decrees, rulings and changes or ordinances,
or judicial or administrative interpretations thereof.
"Handle" means any manner of generating, accumulating,
storing, treating, disposing of, transporting, transferring, labeling,
handling, manufacturing or using, as any of such terms are defined in
any Environmental Law, of any Hazardous Substances or Waste.
"Hazardous Substances" shall be construed broadly to include
any toxic or hazardous substance, material, or waste, and any other
contaminant, pollutant or constituent thereof, whether liquid, solid,
semi-solid, sludge and/or gaseous, including without limitation,
chemicals, compounds, by-products, pesticides, asbestos containing
materials, petroleum or petroleum products, and polychlorinated
biphenyls, the presence of which requires investigation or remediation
under any Environmental Laws or which are regulated, listed or
controlled by, under or pursuant to any Environmental Laws.
"Licenses" means all licenses, certificates, permits,
approvals and registrations.
"Underground Storage Tank" shall have the meaning ascribed to
such term in Section 6901 et seq., as amended, of RCRA, or any
applicable state or local statute, law, ordinance, code, rule,
regulation, order ruling, or decree governing Underground Storage
Tanks.
"Waste" shall be construed broadly to include agricultural
wastes, biomedical wastes, biological wastes, bulky wastes,
construction and demolition debris, garbage, household wastes,
industrial solid wastes, liquid wastes, recyclable materials, sludge,
solid wastes, special wastes, used oils, white goods, and yard trash as
those terms are defined under any applicable Environmental Laws.
<PAGE>
3.13 Real Estate.
(a) Except as set forth on Schedule 3.13(a), neither the
Partnership nor the Subsidiary owns any real property or any interest therein
other than those described in the unsigned draft Title Insurance Commitment
issued by Lawyers Title Insurance Corporation (the "title insurer") as its
Commitment No. 00602158 in the form attached hereto as Schedule 3.13 (the "Title
Insurance Commitment") (the property and interests described in such Title
Insurance Commitment being referred to as the "Owned Properties"). In addition,
the Partnership has delivered to Panthers a true and complete copy of that
certain ALTA Survey of the Owned Properties prepared by Rick Engineering Co. as
its job no. 1969 dated May 24, 1996 (the "Survey"), and Schedule 3.13(a)
describes any additional title exceptions which would be disclosed on an updated
ALTA survey prepared in the same manner as the Survey. With respect to each such
parcel of Owned Property, except as set forth in Schedule 3.13(a), Schedule B
Section 2 to the Title Insurance Commitment or the Survey and except for the
Ground Lease Parcel:
(i) The Partnership has good and marketable title to
or easements upon each parcel of Owned Property as set forth in the
Title Insurance Commitment free and clear of any Lien, easement,
covenant, restriction or encumbrance;
(ii) There are no pending or to the Partnership's
Knowledge threatened condemnation proceedings, suits or administrative
actions relating to the Owned Properties or any access thereto or other
matters affecting adversely the current use, occupancy or value
thereof;
(iii) The legal descriptions for the parcels of Owned
Property contained in the Title Insurance Commitment describe such
parcels fully and adequately; the buildings and improvements are
located within the boundary lines of the described parcels of land, are
not in violation of applicable setback requirements, local
comprehensive plan provisions, zoning laws and ordinances, building
code requirements, permits, licenses or other forms of approval by any
Governmental Authority, and do not encroach on any easement which may
burden the land; the land does not serve any adjoining property for any
purpose inconsistent with the use of the land; and the Owned Properties
are not located within any flood plain (such that a mortgagee would
require a mortgagor to obtain flood insurance) or subject to any
similar type restriction for which any permits or licenses necessary to
the use thereof have not been obtained;
(iv) There are no outstanding options or rights of
first refusal to purchase the parcels of Owned Property or any portion
thereof or interest therein;
(v) All facilities located on the parcels of Owned
Property are supplied with utilities and other services necessary for
the operation of such facilities, including gas, electricity, water,
telephone, sanitary sewer and storm sewer, all of which services are
adequate for the Owned Property and are available in adequate
quantities for the Renovation (as defined in the Limited Partnership
Agreement) in accordance with all applicable laws, ordinances, rules
and regulations, and are provided via public roads or via permanent,
irrevocable, appurtenant easements;
<PAGE>
(vi) None of the Exchange Partners or the Partnership
has received notice of any condemnation or taking of, or any special
assessment which may affect, any parcel of Owned Property; and
(vii) The Owned Property has access to 24th Street
via the nonexclusive easement described as Parcel No. 3 in Schedule A
to the Title Insurance Commitment.
(b) Schedule 3.13(b) sets forth a list of all leases or
licenses of real property or other occupancy agreements under which the
Partnership or the Subsidiary is the lessee, licensee or occupant ("Leases")
(copies of which have previously been furnished to Panthers), in each case
setting forth (A) the lessor, licensor or grantor thereof and the date of each
of the Leases, and (B) a brief description of each property covered thereby.
Except as set forth in Schedule 3.13(b), the Leases are in full force and effect
and have not been amended, and the Partnership is not in default under any such
Lease to which it is an original party or of which it is an assignee since the
date of such assignment, has no Knowledge of any breach or default by the other
party thereto or occurring prior to such assignment and has not given or
received notice of any breach or default thereunder.
(c) Schedule 3.13(c) sets forth a list of all leases or
licenses of real property or other occupancy agreements under which the
Partnership is the lessor, licensor or grantor ("Rental Space Agreements")
(copies of which have previously been furnished to Panthers), in each case
setting forth (A) the lessee thereof and the date of each of the Rental Space
Agreements, and (B) a brief description of each property covered thereby. Except
as set forth in Schedule 3.13(c), the Rental Space Agreements are in full force
and effect and have not been amended, and the Partnership is not in default
under any such Rental Space Agreement to which it is an original party or of
which it is an assignee since the date of such assignment, has no Knowledge of
any breach or default by the other party thereto or occurring prior to such
assignment and has not given or received notice of any breach or default
thereunder. Except as set forth in Schedule 3.13(c), there are no parties in
possession or which have rights to possession of the Owned Properties, other
than the Partnership, its Resort managers and other contractors, guests,
customers and other invitees in the ordinary course of business.
(d) Renovation. The Partnership, the Exchange Partners and the
Partners believe in good faith that all approvals of Government Authorities
(including licenses, approvals, authorizations and permits) required to allow
the Partnership to commence the Renovation will be granted.
(e) Schedule 3.13(e) lists all agreements to which the
Partnership is a party or which have been assigned to the Partnership pertaining
to the operation or use of the Adobe or Links golf courses (collectively the
"Golf Course") or granting any option or right of refusal to acquire any portion
of such Golf Course (the "Golf Course Agreements"). The Partnership has provided
true and complete copies of the Golf Course Agreements to Panthers. The Third
Amendment to the Replacement Golf and Maintenance Privilege Agreement has been
<PAGE>
duly executed and delivered. Except as set forth in the Golf Course Agreements
or in Schedule 3.13(e), such Golf Course Agreements are legal, valid and
binding, in full force and effect, have not been amended or terminated and are
enforceable in accordance with their terms (except as set forth on Schedule 3.3
or such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and general equitable principles regardless of
whether such enforceability is considered in a proceeding at law or in equity),
and neither Rostland's Continuing First Right of Refusal nor Rostland's Option
to Purchase (as these terms are defined in Sections 5.1 and 5.3, respectively,
of the Replacement Golf and Maintenance Privilege Agreement dated January 1,
1980) has been waived. The Partnership is not in breach or default of any of its
obligations under any of such Golf Course Agreements since the assignment
thereof to the Partnership and has no Knowledge of any uncured breach or default
thereunder which occurred prior to the assignment thereof to the Partnership.
(f) Notwithstanding anything contained in Section 3.13, if the
title insurance policy issued pursuant to the Title Insurance Commitment would
cover any part of the loss or liability resulting from any breach of a
representation or warranty in Section 3.13, or in Section 3.22 to the extent
based thereon, then regardless of whether the amount of such title insurance
coverage is sufficient to cover the full loss, the Partnership, Exchange
Partners and Partners shall not be in breach or default under this Agreement or
have any liability, whether to Panthers, Panthers SPE, the title insurer or
otherwise, in the event that such representation or warranty is inaccurate or
incomplete in the respect covered by such title insurance policy.
3.14 Good Title to and Condition of Assets, Resort Revenue.
(a) Except as set forth on Schedule 3.14(a), the Partnership
has good and marketable title to all of its respective Assets (as hereinafter
defined), free and clear of any Liens or contractual restrictions on use, which
Assets together with the Owned Properties and Leased Premises constitute all
assets necessary to conduct the business of the Partnership in the manner in
which and to the extent to which such business is currently being conducted. For
purposes of this Agreement, the term "Assets" means all of the properties,
rights and assets of the Partnership, other than the Owned Properties and Leased
Premises, whether personal or mixed, tangible or intangible, wherever located.
(b) Except as set forth on Schedule 3.14(b), the Fixed Assets
(as hereinafter defined) currently in use or necessary for the business and
operations of the Partnership are in working order, subject to ordinary
reasonable maintenance, repair and obsolescence, and have been maintained
substantially in accordance with all applicable manufacturer's specifications
and warranties. Except as set forth on Schedule 3.14(b), all Fixed Assets which
constitute improvements and buildings are in good repair and are safe for
occupancy and use, free from termites or other wood-destroying organisms, the
roofs thereof are watertight and the structural components and systems
(including plumbing, electrical, air conditioning/heating, and sprinklers) are
in good working order, subject to ordinary, reasonable maintenance, repair and
obsolescence, and adequate for the use by the Owned Property in the manner in
which presently used. For purposes of this Agreement, the term "Fixed Assets"
<PAGE>
means all buildings and improvements located on the Owned Properties and the
Leased Properties and all vehicles, machinery, equipment, tools, supplies,
furniture and fixtures used by or located on the premises of the Partnership or
set forth on the Current Balance Sheets or acquired by the Partnership since the
date of the Current Balance Sheet.
(c) The primary asset of the Partnership is the Resort. Except
as set forth on Schedule 3.14(c), all revenue of the Resort accrues for the
benefit of the Partnership. Schedule 3.14(c) sets forth (i) all contracts,
agreements and understandings between or among the Partnership, the Arizona
Biltmore Hotel Villas Condominium Association, the Exchange Partners and the
Partners and/or their Affiliates and (ii) all fees, charges, assessments and
revenue from the Partnership remitted to any of the Exchange Partners, Partners
or Affiliates of the Partnership, Exchange Partners and the Partners on a
monthly or other basis.
3.15 Compliance with Laws.
(a) Except as set forth on Schedule 3.15, each of the
Partnership and the Subsidiary is and to the extent material has been in
compliance with all laws, regulations and orders applicable to it, its business
and operations (as conducted by it now and in the past), the Assets, the Owned
Properties and the Leased Premises and any other properties and assets (in each
case owned or used by it now or in the past), neither the Partnership nor the
Subsidiary has been cited, fined or otherwise notified in writing of any
asserted material past or any present failure to comply with any laws,
regulations or orders and no proceeding with respect to any such violation is
pending or to the Knowledge of the Exchange Partners threatened.
(b) None of the Partnership, the Subsidiary, or any of their
authorized representatives has made any payment of funds in connection with the
business of the Partnership or the Subsidiary which is prohibited by law, and no
funds have been set aside to be used in connection with the business of the
Partnership or the Subsidiary for any payment prohibited by law.
(c) Each of the Partnership and the Subsidiary is and at all
times has been in substantial compliance with the terms and provisions of the
Immigration Reform and Control Act of 1986, as amended (the "Immigration Act").
With respect to each Employee (as defined in 8 C.F.R. 274a.1(f)) of the
Partnership for whom compliance with the Immigration Act is required, the
Partnership has on file true, accurate and complete copies of (i) each
Employee's Form I-9 (Employment Eligibility Verification Form) and (ii) all
other records, documents or other papers prepared, procured and/or retained by
the Partnership pursuant to the Immigration Act. Neither the Partnership nor the
Subsidiary has been cited, fined, served with a Notice of Intent to Fine or with
a Cease and Desist Order, nor has any action or administrative proceeding been
initiated or to the Knowledge of the Partnership threatened against the
Partnership or the Subsidiary, by the Immigration and Naturalization Service by
reason of any actual or alleged failure to comply with the Immigration Act.
Except as set forth on Schedule 3.15, each of the Partnership and the Subsidiary
has complied with applicable laws, rules and regulations relating to employment,
civil rights and equal employment opportunities, including but not limited to,
the Civil Rights Act of 1964, the Fair Labor Standards Act, and the Americans
with Disabilities Act, as amended.
<PAGE>
(d) Except as set forth on Schedule 3.15, each of the
Partnership and the Subsidiary possesses for its sole benefit all licenses,
permits or authorizations (collectively, the "Permits") required by any
Governmental Authority for its respective businesses and operations, including
with respect to the operation of each of the Owned Properties and Leased
Premises. All such Permits are valid and in full force and effect, the
Partnership (or if applicable the Subsidiary) is in full compliance with the
respective requirements thereof, and no proceeding is pending or to the
Knowledge of the Exchange Partners threatened to revoke or amend any of them.
Except as set forth on Schedule 3.5 or Schedule 3.15, none of such Permits is or
will be impaired or in any way affected by the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.
(e) Except as set forth on Schedule 3.15(e), the Partnership
is not subject to any Contract, decree or injunction in which the Partnership is
a party which restricts the continued operation of any business of the
Partnership or the expansion thereof to other geographical areas, customers and
suppliers or lines of business, other than normal and customary exclusivity
clauses in Contracts with providers of goods or services during the term of such
Contracts.
3.16 Labor and Employment Matters. The Partnership has delivered to
Panthers a list as of the date indicated on such list which sets forth the name
and current rate of compensation of the employees of AZB and a list of the
categories, approximate number of employees in each category and pay ranges
within each category of the employees of the Partnership (the "Employees").
Except as set forth on Schedule 3.16 the Partnership is not a party to or bound
by any collective bargaining agreement or any other agreement with a labor
union, and to its Knowledge there has been no effort by any labor union during
the 24 months prior to the date hereof to organize any Employees of the
Partnership into one or more collective bargaining units. There is no pending or
to its Knowledge threatened labor dispute, strike or work stoppage which affects
or which may affect the business of the Partnership or which may interfere with
its continued operations. Neither the Partnership nor any agent, representative
or Employee thereof has to the Knowledge of the Partnership within the last 24
months committed any unfair labor practice as defined in the National Labor
Relations Act, as amended, and there is no pending or to its Knowledge
threatened charge or complaint against the Partnership by or with the National
Labor Relations Board or any representative thereof. There has been no strike,
walkout or work stoppage involving Employees of the Partnership during the 24
months prior to the date hereof. None of the Exchange Partners or the
Partnership has Knowledge that any executive or key Employee or group of
Employees for a common purpose has any plans to terminate his, her or their
employment with the Partnership or with AZB. Schedule 3.16 contains a list which
briefly describes each written contract, agreement or plan of the following
nature, whether formal or informal, and whether or not in writing, to which the
Partnership and/or AZB is a party or under which either has any obligation: (i)
employment agreements with individuals; (ii) employee handbooks, policy
statements and similar plans; (iii) noncompetition agreements; and (iv)
consulting agreements.
<PAGE>
3.17 Employee Benefit Plans.
(a) Employee Benefit Plans. Schedule 3.17 lists each employee
benefit plan or arrangement of the Partnership, including but not limited to
employee pension benefit plans, as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), multiemployer
plans, as defined in Section 3(37) of ERISA, employee welfare benefit plans, as
defined in Section 3(1) of ERISA, deferred compensation plans, stock option
plans, bonus plans, stock purchase plans, hospitalization, disability and other
insurance plans, severance or termination pay plans and policies, whether or not
described in Section 3(3) of ERISA, in which employees, their spouses or
dependents, of the Partnership participate ("Employee Benefit Plans") (true and
accurate copies of which, together with the most recent annual reports on Form
5500 and summary plan descriptions with respect thereto, were furnished to
Panthers).
(b) Compliance with Law. With respect to each Employee Benefit
Plan (i) each has been administered in compliance with its terms and with all
applicable laws, including, but not limited to, ERISA and the Code; (ii) no
actions, suits, claims or disputes are pending, or to its Knowledge threatened;
(iii) no audits, proceedings, claims, or demands are pending with any
governmental or regulatory agency; (iv) since the Partnership was created or
became the employer thereunder, all reports, returns, and similar documents
required to be filed with any governmental agency or distributed to any plan
participant have been duly or timely filed or distributed, and the Partnership
has no knowledge of the failure of any predecessor employers to timely file such
reports, returns and similar documents; and (v) no "prohibited transaction" has
occurred within the meaning of the applicable provisions of ERISA or the Code.
(c) Qualified Plans. With respect to each Employee Benefit
Plan intended to qualify under Code Section 401(a) or 403(a), (i) the Internal
Revenue Service has issued a favorable determination letter, true and correct
copies of which have been furnished to Panthers, that such plans are qualified
and exempt from federal income taxes; (ii) no such plan has been amended in a
manner that would require security to be provided in accordance with Section
401(a)(29) of the Code; (iii) no reportable event (within the meaning of Section
4043 of ERISA) has occurred, other than one for which the 30-day notice
requirement has been waived; (iv) as of the Effective Date, the present value of
all liabilities that would be "benefit liabilities" under Section 4001(a)(16) of
ERISA if benefits described in Code Section 411(d)(6)(B) were included will not
exceed the then current fair market value of the assets of such plan (determined
using the actuarial assumptions used for the most recent actuarial valuation for
such plan); (v) all contributions to, and payments from and with respect to such
plans, which may have been required to be made in accordance with such plans
and, when applicable, Section 302 of ERISA or Section 412 of the Code, have been
timely made; (vi) all such contributions to the plans, and all payments under
the plans (except those to be made from a trust qualified under Section 401(a)
of the Code) and all payments with respect to the plans (including, without
limitation, PBGC (as defined below) and insurance premiums) for any period
ending before the Effective Date that are not yet, but will be, required to be
made are properly accrued and reflected on the Current Balance Sheet; and (vii)
no such determination letter has been revoked nor to the Partnership's Knowledge
has revocation been threatened, nor has any amendment or other action or
omission occurred with respect to any such plan since the date of its most
<PAGE>
recent determination letter or application therefor in any respect which would
adversely affect its qualification.
(d) Multiemployer Plans. With respect to any multiemployer
plan, as described in Section 4001(a)(3) of ERISA ("MPPA Plan"): (i) all
contributions required to be made with respect to employees of the Partnership
have been timely paid; (ii) the Partnership has not incurred or is not expected
to incur, directly or indirectly, any withdrawal liability under ERISA with
respect to any such plan (whether by reason of the transactions contemplated by
the Agreement or otherwise); (iii) Schedule 3.17 sets forth (A) the withdrawal
liability under ERISA to each MPPA Plan, (B) the date as of which such amount
was calculated, and (C) the method for determining the withdrawal liability; and
(iv) no such plan is (or is expected to be) insolvent or in reorganization and
no accumulated funding deficiency (as defined in Section 302 of ERISA and
Section 412 of the Code), whether or not waived, exists or is expected to exist
with respect to any such plan.
(e) Welfare Plans. Except as required pursuant to Section
4980B of the Code, the Partnership is not obligated under any employee welfare
benefit plan as described in Section 3(1) of ERISA ("Welfare Plan") to provide
medical or death benefits with respect to any Employee or former Employee of the
Partnership or its predecessors after termination of employment. The Partnership
has complied with the notice and continuation coverage requirements of Section
4980B of the Code and the regulations thereunder with respect to each Welfare
Plan that is, or was during any taxable year for which the statute of
limitations on the assessment of federal income taxes remains, open, by consent
or otherwise, a group health plan within the meaning of Section 5000(b)(1) of
the Code. There are no reserves, assets, surplus or prepaid premiums under any
Welfare Plan which is an Employee Benefit Plan. The consummation of the
transactions contemplated by this Agreement will not entitle any individual to
severance pay, and, will not accelerate the time of payment or vesting or
increase the amount of compensation due to any individual.
(f) Controlled Group Liability. The Partnership will not
suffer any loss, cost or injury as a result of any claim that the Partnership or
any entity that would be aggregated with the Partnership under Code Section
414(b), (c), (m) or (o): (i) has ever terminated or withdrawn from any employee
benefit plan under circumstances resulting (or expected to result) in liability
to the Pension Benefit Guaranty Corporation ("PBGC"), the fund by which the
employee benefit plan is funded, or any employee or beneficiary for whose
benefit the plan is or was maintained (other than routine claims for benefits,
including without limitation, routine benefits due participants and
beneficiaries as a result of termination of the Arizona Biltmore Employees
Savings Plan); (ii) has any assets subject to (or expected to be subject to) a
lien for unpaid contributions to any employee benefit plan; (iii) has failed to
pay premiums to the PBGC when due; (iv) is subject to (or expected to be subject
to) an excise tax under Code Section 4971; (v) has engaged in any transaction
which would give rise to liability under Section 4069 or Section 4212(c) of
ERISA; or (vi) has violated Code Section 4980B or Section 601 through 608 of
ERISA.
(g) Other Liabilities. (i) None of the Employee Benefit Plans
obligates the Partnership to pay separation, severance, termination or similar
<PAGE>
benefits solely as a result of any transaction contemplated by this Agreement or
solely as a result of a "change of control" (as such term is defined in Section
280G of the Code); (ii) all required or discretionary (in accordance with
historical practices) payments, premiums, contributions, reimbursements, or
accruals for all periods ending prior to or as of the Effective Date shall have
been made or properly accrued on the Current Balance Sheets or will be properly
accrued on the books and records of the Selling Shareholders as of the Effective
Date; and (iii) none of the Employee Benefit Plans has any unfunded liabilities
which are not reflected on the Current Balance Sheets or the books and records
of the Partnership.
3.18 Insurance. The Partnership is covered by valid, outstanding and
enforceable insurance described in Certificates of Insurance listed in Schedule
3.18, true and complete copies of which have been provided to Panthers covering
its respective properties, assets and businesses against the risks and in the
coverage amounts set forth on Schedule 3.18 ("Insurance Policies"). Such
Insurance Policies are in full force and effect, all premiums due thereon have
been paid, and none of such Insurance Policies is cancelable without 30 days
prior written notice. As of the Closing, each of the Insurance Policies or
replacement policies providing substantially equivalent coverages will be in
full force and effect. The Partnership has complied with the provisions of such
Insurance Policies. Schedule 3.18 lists (i) all Insurance Policies and all
amendments and riders thereto (copies of which have been provided to Panthers)
and (ii) each pending claim under any of the Insurance Policies for an amount in
excess of $10,000 that relates to loss or damage to the properties, assets or
businesses of the Partnership. The Partnership has not failed to give, in a
timely manner, any notice required under any of the Insurance Policies to
preserve its rights thereunder.
3.19 Receivables. All of the Receivables (as hereinafter defined) are
valid and legally binding, represent bona fide transactions and arose in the
ordinary course of business of the Partnership. For purposes of this Agreement,
the term "Receivables" means all receivables of the Partnership or the
Subsidiary, including all trade account receivables arising from the provision
of services, sale of inventory, notes receivable and insurance proceeds
receivable.
3.20 Intellectual Property. Schedule 3.20 sets forth all trademarks,
service marks, trade names, copyrights, patents, trade secrets, licenses
(excluding licenses for the use of computer software programs) and other
intellectual property used by the Partnership or the Subsidiary in the conduct
of its business (the "Intellectual Property"). The conduct of the business of
the Partnership and the Subsidiary as presently conducted, and the unrestricted
conduct and the unrestricted use and exploitation of the Intellectual Property,
does not infringe or misappropriate any rights held or asserted by any Person.
No payments are required for the continued use of the Intellectual Property.
3.21 Designated Contracts. Schedule 3.21 lists each Designated Contract
as defined below to which the Partnership or the Subsidiary is a party or by
which it or its properties and assets are bound and which is material to its
business, assets, properties or prospects, copies of which have been provided to
Panthers. The copy of each Designated Contract furnished to Panthers is a true
and complete copy of the document it purports to represent and reflects all
amendments thereto made through the date of this Agreement. Except as set forth
on Schedule 3.21, the Designated Contracts have been duly executed and delivered
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and constitute legal, valid, binding and enforceable obligations of the parties
and are in full force and effect. Neither the Partnership nor the Subsidiary has
violated any of the material terms or conditions of any Designated Contract or
any term or condition which would permit termination or material modification of
any Designated Contract, all of the covenants to be performed by any other party
thereto have been fully performed and there are no claims for breach or
indemnification or notice of default or termination under any Designated
Contract. Except as set forth on Schedule 3.21, no event has occurred which
constitutes, or after notice or the passage of time, or both, would constitute,
a material default by the Partnership or the Subsidiary under any Designated
Contract, and no such event has occurred which constitutes or would constitute a
material default by any other party. Neither the Partnership nor the Subsidiary
is subject to any liability or payment resulting from renegotiation of amounts
paid to it under any Designated Contract. As used in this Section, Designated
Contracts shall mean, (a) loan agreements, indentures, mortgages, pledges,
hypothecations, deeds of trust, conditional sale or title retention agreements,
security agreements, equipment financing obligations or guaranties, or other
sources of contingent liability in respect of any indebtedness or obligations to
any other Person, or letters of intent or commitment letters with respect to
same; (b) Contracts obligating the Partnership or the Subsidiary to provide or
purchase products or services for a period of one year or more (other than
advance bookings or Contracts terminable upon payment of less than $25,000); (c)
leases of personal property not cancelable without penalty on notice of sixty
(60) days or less or calling for payment of an annual gross rental exceeding
$25,000; (d) confidentiality agreements; (e) any Contract relating to pending
capital expenditures by the Partnership or the Subsidiary exceeding $25,000; (f)
Contracts obligating the Partnership to purchase management services; or (g) any
Contract of the Partnership or the Subsidiary calling for payment in any year
exceeding $25,000.
3.22 Accuracy of Information Furnished by the Exchange Partners and the
Partnership. No representation, statement or information made or furnished by
the Exchange Partners, the Partners and the Partnership to Panthers or any of
Panthers' representatives contained in this Agreement and the various Schedules
attached hereto and the other information and statements referred to herein
which were previously furnished by the Partnership, the Exchange Partners and
the Partners, contains or shall contain any untrue statement of a material fact
or omits or shall omit any material fact necessary to make the information
contained therein not misleading. Copies of all documents listed or described in
the various Schedules attached hereto provided by the Exchange Partners, the
Partners and the Partnership to Panthers are true, accurate and complete.
3.23 Investment Intent. Each of the Partners (each an "Investor" and
collectively the "Investors") is acquiring the Class B, C, D and E Units, the
Warrants and the Panthers Common Stock (collectively the "Securities") hereunder
for its own account and with no present intention of distributing or selling
such Securities and further agrees not to transfer such Securities in violation
of the Securities Act or any applicable state securities law, and no one other
than the Investor has any beneficial interest in the Securities. The Investor
agrees that it will not sell or otherwise dispose of any of the Securities
unless such sale or other disposition has been registered under the Securities
Act or, in the opinion of counsel acceptable to Panthers, is exempt from
registration under the Securities Act and has been registered or qualified or,
in the opinion of such counsel, is exempt from registration or qualification
under applicable state securities laws. The Investor understands that the offer
<PAGE>
and sale by Panthers of the Securities being acquired by the Investor hereunder
has not been registered under the Securities Act by reason of their contemplated
issuance in transactions exempt from the registration and prospectus delivery
requirements of the Securities Act pursuant to Section 4(2) thereof, and that
the reliance of Panthers on such exemption from registration is predicated in
part on these representations and warranties of the Investor. The Investor
acknowledges that pursuant to Article X of this Agreement a restrictive legend
consistent with the foregoing has been or will be placed on the certificates for
the Securities.
3.24 Accredited Investors. The Investor is an "accredited investor," as
such term is defined in Rule 501(a) of Regulation D under the Securities Act and
has such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of the investment to be made by it
hereunder.
3.25 Adequate Information. The Investor or its designated
representative has received from Panthers, and has reviewed, such information
which the Investor or its designated representative considers necessary or
appropriate to evaluate the risks and merits of an investment in the Securities.
The Investor acknowledges that each of the SEC Filings, including the sections
under the heading "RISK FACTORS" in the Annual Report on Form 10-K for the
fiscal year ended June 30, 1997, are specifically incorporated herein by
reference and form an integral part of this Agreement. The Investor has not
relied upon projections, or forward looking financial information of Panthers in
relation to its investment in the Securities except to the extent set forth in
the SEC Filings which are subject to the disclaimers set forth therein with
respect to forward-looking statements.
3.26 Opportunity to Question. The Investor has had the opportunity to
question, and has questioned, to the extent deemed necessary or appropriate,
representatives of Panthers so as to receive answers and verify information
obtained in the Investor's examination of the Panthers, including the
information that the Investor has received and reviewed as referenced in Section
3.25 hereof in relation to its investment in the Securities.
3.27 No Other Representations. No oral or written representations have
been made to the Investor in connection with the Investor's acquisition of the
Securities which were in any way inconsistent with the information reviewed by
the Investor. The Investor acknowledges that no representations or warranties of
any type or description have been made to it by any Person with regard to the
Panthers, any of its Subsidiaries, any of their respective businesses,
properties or prospects or the investment contemplated herein, other than the
representations and warranties set forth in Article II hereof. The foregoing
acknowledgment does not affect the right of the Investors to rely on the SEC
Filings.
3.28 Knowledge and Experience. The Investor has such knowledge and
experience in financial, tax and business matters, including substantial
experience in evaluating and investing in common stock and other securities
(including the common stock and other securities of new and speculative
companies), so as to enable the Investor to utilize the information referred to
in Section 3.25 hereof and any other information made available by Panthers to
the Investor in order to evaluate the merits and risks of an investment in the
Securities and to make an informed investment decision with respect thereto.
<PAGE>
3.29 Independent Decision. The Investor is not relying on the Panthers
or on any legal or other opinion in the materials reviewed by the Investor with
respect to the financial or tax considerations of the Investor relating to its
investment in the Securities. The Investor has relied solely on the
representations and warranties, covenants and agreements of Panthers in this
Agreement (including the Schedules hereto) and on its examination and
independent investigation, including the SEC Filings, in making its decision to
acquire the Securities.
3.30 No Commissions. None of Partnership, the Exchange Partners or the
Partners has incurred any obligation for any finder's or broker's or agent's
fees or commissions or similar compensation in connection with the transactions
contemplated hereby.
3.31 Tax Matters. Except as set forth on Schedule 3.31 attached hereto:
(i) all Tax Returns required to be filed with respect to the Partnership or the
Subsidiary or any of its income, properties, assets, franchises or operations
have been timely filed, and each such Tax Return has been prepared in compliance
with all applicable legal requirements and all such Tax Returns are true and
accurate in all respects; (ii) all Taxes due and payable by or with respect to
the Partnership or the Subsidiary through October 31, 1997, have been paid or
are accrued on the Interim Statements; (iii) all Taxes paid, accrued or incurred
in whole or in part by the Partnership or the Subsidiary with respect to its
income, payroll, properties, assets or operations through the end of the month
in which this Agreement is executed and relating in whole or in part for periods
ending on such date will be reflected on its books and records as of such date,
whether or not such Taxes are payable before, on or after such date; (iv) as of
the date hereof, the Partnership has not filed with the Internal Revenue Service
a Form 8832 (relating to an election to be taxed as a corporation) and such Form
8832 shall not be filed by the Partnership for any tax period ending on or
before the Closing Date; (v) no deficiency, proposed adjustment or proposed
assessment, which has not been settled or otherwise resolved, has been asserted
or to the Partnership's Knowledge assessed by any taxing authority against the
Partnership or the Subsidiary; (vi) neither the Partnership nor the Subsidiary
has consented to extend the time in which any Taxes may be assessed or collected
from the Partnership or the Subsidiary by any taxing authority; (vii) neither
the Partnership nor the Subsidiary has requested or been granted an extension of
time for filing any Tax Return to a date later than the date hereof; (viii)
there is no action, suit, taxing authority proceeding, audit or examination or
claim for refund now in progress, pending or threatened against or with respect
to the Partnership or the Subsidiary regarding Taxes; (ix) there are no liens
for Taxes (other than for current Taxes not yet due and payable) upon the
properties or assets of the Partnership or the Subsidiary; (x) true, correct and
complete copies of all Tax Returns filed by or with respect to the Partnership
or the Subsidiary for the past three tax years or other tax periods have been
furnished or otherwise made available to Panthers; and (xi) to its Knowledge, no
claim has ever been made by a taxing authority in a jurisdiction in which the
Partnership or the Subsidiary does not file Tax Returns that the Partnership or
the Subsidiary is or may be subject to Taxes assessed by or payable to such
jurisdiction. Notwithstanding any other provision of this Agreement or of the
Partnership Agreement or the Limited Partnership Agreement to the contrary, the
Exchange Partners shall pay at their own sole cost and expense, without any
right of reimbursement, setoff , or increase of their capital accounts, any Tax
of the Partnership or the Subsidiary which is or at any time becomes due and
payable with respect to any period ending on or before the end of the month in
<PAGE>
which this Agreement is executed, whether as a result of any failure to file or
mistake in any tax return, reassessment or audit by any taxing authority or
otherwise, except if and to the extent that there is an accrued liability for
such Tax reflected in the audited financial statements for the Partnership
ending on the last day of the month in which this Agreement is executed other
than the amount of the ad valorem tax obligation on appeal (all such accruals
other than such ad valorem tax obligation being hereinafter called a "Tax
Accrual"), and any such Taxes shall be paid by the Partnership to the extent of
any such Tax Accrual before the Exchange Partners shall be liable for any
balance thereof. Any such payment shall be made without regard to Article 8,
other than Panther's Hold Back and Set Off Rights. In consideration of the
foregoing, the Partnership hereby assigns to the Exchange Partners, and the
Exchange Partners shall be entitled to receive in full directly from the taxing
authority, or in the event such amount is received by the Partnership it shall
forthwith be paid over in full (as a Partnership obligation and not as a
distribution pursuant to any provision of the Partnership Agreement) to the
Exchange Partners, any refund of Taxes of the Partnership or the Subsidiary for
any period prior to the end of the month in which this Agreement is executed.
ARTICLE IV
CONDUCT OF BUSINESS PENDING THE CLOSING
4.1 Except as hereinafter expressly provided, the Partnership, the
Exchange Partners and the Partners covenant and agree that, between the date of
this Agreement and the Closing Date, the business of the Partnership and the
Subsidiary shall be conducted only in and it shall not take any action except
in, the ordinary course of business, consistent with past practice. The
Partnership shall use its best efforts to preserve intact its business
organization, to keep available the services of its current management,
officers, employees and consultants, and to preserve its present relationships
with customers, suppliers and other persons with which it has significant
business relations. Until the Closing, the Partnership shall maintain insurance
coverages at levels equal to or greater than the insurance in place on the date
hereof. In addition, until the Closing, AZB will operate in the ordinary course
of business consistent with past practices with respect to its employees. By way
of amplification and not limitation, except as contemplated by this Agreement,
the Partnership and the Subsidiary shall not, between the date of this Agreement
and the Closing Date, directly or indirectly, do or propose or agree to do or
allow the Subsidiary to do or agree to do any of the following without the prior
written consent of Panthers:
(a) amend or otherwise change its Partnership
Agreement or certificate of General Partnership or equivalent
organizational documents;
(b) issue, sell, pledge, dispose of, encumber, or
authorize the issuance, sale, pledge, disposition, grant or encumbrance
of (i) any Partnership interests, or any options, warrants, convertible
securities or other rights of any kind to acquire any Partnership
interest, or (ii) any of its assets, tangible or intangible, except in
the ordinary course of business consistent with past practice;
(c) enter into any new agreement with an Affiliate of
the Partnership or declare, set aside, make or pay any dividend or
other distribution, payable in cash, property or otherwise, with
<PAGE>
respect to any of its partnership interests other than Semi-annual
Distributions;
(d) reclassify, combine, split, subdivide or redeem,
purchase or otherwise acquire, directly or indirectly, any Partnership
interests;
(e) (i) acquire (including, without limitation, for
cash or Partnership interests, by merger, consolidation, or acquisition
of stock, partnership interest or assets) any interest in any
corporation, partnership or other business organization or division
thereof or any assets, or make any investment either by purchase of
stock, partnership interest or other securities, contributions of
capital or property transfer, or, purchase any property or assets of
any other Person, (ii) incur any indebtedness for borrowed money or
issue any debt securities or assume, guarantee or otherwise as an
accommodation become responsible for, the obligations of any Person, or
make any loans or advances, or (iii) enter into any Contract not
cancelable without penalty on notice of sixty (60) days or less or
calling for payment of annual payments exceeding $25,000 other than in
the ordinary course of business, consistent with past practice;
(f) except in the ordinary course of business
consistent with past practice, increase the compensation payable or to
become payable to its managers, officers or employees, or, except as
presently bound to do, grant any severance or termination pay to, or
enter into any employment or severance agreement with, any of its
directors, officers or other employees, or establish, adopt, enter into
or amend or take any action to accelerate any rights or benefits which
any collective bargaining, bonus, profit sharing, trust, compensation,
stock option, restricted stock, pension, retirement, deferred
compensation, employment, termination, severance or other plan,
agreement, trust, fund, policy or arrangement for the benefit of any
directors, officers or employees;
(g) other than changes contemplated by the Management
Agreement, take any action other than in the ordinary course of
business and in a manner consistent with past practice with respect to
accounting policies or procedures;
(h) pay, discharge or satisfy any existing claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise), other than the payment, discharge or
satisfaction in the ordinary course of business and consistent with
past practice of due and payable liabilities reflected or reserved
against in its financial statements, as appropriate, or liabilities
incurred after the date hereof in the ordinary course of business and
consistent with past practice;
(i) make any material decision regarding the Golf
Course including but not limited to: (i) restriction of Golf Course
privileges, including use of the Golf Course; (ii) litigation involving
the Golf Course; (iii) the purchase of the Golf Course; and (iv) the
modification, renewal or extension of the Golf Course Agreements listed
on Schedule 3.13(e); or
<PAGE>
(j) agree, in writing or otherwise, to take or
authorize any of the foregoing actions or any action which would make
any representation or warranty in Article III untrue or incorrect.
4.2 Notwithstanding the foregoing, the Partnership may: (i) in
accordance with the Renovation Standards, Renovation Budget and Renovation
Plans, as defined in the Limited Partnership Agreement, without the consent of
Panthers, take any or all actions which comply with applicable law and which it
deems necessary or appropriate in order to prepare and commence work on the
Renovation; (ii) continue construction of the Resort health club ("Spa") in
material compliance with the Spa budget attached hereto as Schedule 4.2 (i.e.,
without exceeding such budget by more than 10%) and shall pay in the ordinary
course of business consistent with past practice the expenses of such
construction; and (iii) enter into an advance booking agreement with Leading
Hotels for no longer than a 5-year term. In addition, at any time prior to
Closing the Partnership may take such actions, whether or not in the ordinary
course of business, as it determines in good faith to be necessary or
appropriate in order to correct any situation or condition which constitutes or
could result in a Material Adverse Change; provided, however, that in making any
such correction the Partnership shall not, except with the consent of Panthers,
use any existing cash of the Partnership or cash flow from its operations, shall
give reasonable notice thereof to Panthers, shall provide such information
regarding such matter as Panthers may reasonably request and shall make all
reasonable and diligent efforts to consult with Panthers concerning such matter
before taking any action in connection therewith; and provided further that in
no event shall the Partnership be required to delay any such action or decision
for more than thirty (30) days or until such earlier deadline as the Partnership
determines in good faith is necessary for such action or decision.
4.3 Between the date of this Agreement and the Closing, except with the
consent of Panthers, neither the Exchange Partners nor any of the Partners or
their Affiliates shall enter into any new agreement with the Partnership or take
or acquire for themselves any material opportunity related to the Resort,
including without limitation acquiring any interest in the Golf Course or other
real property in the vicinity of the Resort.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 Further Assurances. The parties mutually acknowledge that, upon
execution of this Agreement, all Schedules referred to herein have been attached
and all items indicated herein to have been delivered have been received. Each
party shall execute and deliver, such additional instruments and other documents
and shall take such further actions as may be necessary or appropriate to
effectuate, carry out and comply with all of the terms of this Agreement and the
transactions contemplated hereby. The Exchange Partners and the Partners shall
cause the Partnership to comply with all the respective covenants of the
Partnership under this Agreement. Panthers shall cause Panthers SPE to comply
with all of its covenants under this Agreement. At the Closing the parties
covenant and agree to deliver the certificates, opinions, closing and other
documents required to be delivered by them pursuant to Article VI or any other
provision of this Agreement.
<PAGE>
5.2 Cooperation. Each of the parties agrees to cooperate with the other
parties in the preparation and filing of all forms, notifications, reports and
information, if any, required or reasonably deemed advisable pursuant to any
law, rule or regulation or the rules of any exchange on which the Panthers
Common Stock is listed or the New York Stock Exchange in connection with the
transactions contemplated by this Agreement and to use its respective reasonable
best efforts to agree jointly on a method to overcome any objections by any
Governmental Authority to any such transactions.
5.3 HSR Act and Other Actions. Each of the parties hereto shall (i)
make promptly (and in no event later than ten (10) business days following the
execution of this Agreement with attachment of all Schedules hereto) its
respective filings, if any, and thereafter make any other required submissions,
under the HSR Act, with respect to the transactions contemplated hereby, and
(ii) use its reasonable best efforts to take, or cause to be taken, all
appropriate actions, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated herein, including, without limitation,
using its best efforts to obtain all licenses, permits, consents, approvals,
authorizations, qualifications and orders of any Governmental Authority and
parties to Contracts with the Partnership and the Exchange Partners of the
Partnership as are necessary for the consummation of the transactions
contemplated hereby. Each of the parties shall make on a prompt and timely basis
all governmental or regulatory notifications and filings required to be made by
it for the consummation of the transactions contemplated hereby. The parties
also agree to use reasonable best efforts to defend all lawsuits or other legal
proceedings challenging this Agreement or the consummation of the transactions
contemplated hereby and to lift or rescind any injunction or restraining order
or other order adversely affecting the ability of the parties to consummate the
transactions contemplated hereby.
5.4 Access to Information. From the date hereof to the Closing Date,
the Partnership and the Exchange Partners shall (and shall cause its directors,
officers, employees, auditors, counsel and agents) afford Panthers and Panthers'
officers, employees, auditors, counsel and agents reasonable access on
reasonable notice at all reasonable times to its properties, offices, and other
facilities, to its officers and employees and to all books and records, and
shall furnish such persons with all financial, operating and other data and
information as may be requested. No information provided to or obtained by
Panthers shall affect any representation or warranty in this Agreement.
5.5 Notification of Certain Matters; Schedules. The Partnership and the
Exchange Partners shall give prompt written notice to Panthers of the occurrence
or non-occurrence of any event which would likely cause any representation or
warranty contained herein (including with respect to any Schedules attached
hereto), to be untrue or inaccurate, or any covenant, condition, or agreement
contained herein not to be complied with or satisfied.
5.6 Confidentiality; Publicity. No press release or other public
announcement related to this Agreement or the transactions contemplated hereby
shall be issued by any party hereto without the prior approval of the other
parties (the "Announcement"); provided, however, that the Partnership shall have
the final approval over any press release in the Phoenix metropolitan area.
<PAGE>
After the Announcement, Panthers may make such public disclosure as it believes
in good faith to be required by law or by the terms of any listing agreement
with or requirements of any securities exchange upon which Panthers' Common
Stock is traded, including the New York Stock Exchange (in which case Panthers
will provide a copy to the Exchange Partners promptly after making such
disclosure). The Partners acknowledge that Panthers is required to make certain
disclosures and shall consult with Panthers regarding the same. The requirements
of this paragraph will lapse as of the Closing, except that, both before and
after Closing, each party agrees that, other than in the ordinary course of
business or unless it is required to do so by law or any such stock exchange
agreement or requirements, it will not disclose the content or provide copies of
(i) the Schedules hereto (other than the Closing Documents), (ii) any documents
received from any other party pursuant hereto or (iii) any other confidential
information described on Schedule 5.6.
5.7 No Other Discussions. While this Agreement is in effect, the
Partnership, the Partners and their respective Affiliates, employees, agents and
representatives will not: (i) initiate or encourage the initiation by others of
discussions or negotiations with third parties relating to any sale of
Partnership interests, sale or other disposition of the Resort or any
substantial part of the assets, business or properties of the Partnership; or
(ii) enter into any agreement or commitment (whether or not binding) with
respect to any of the foregoing transactions. The Partnership and the Partners
will immediately notify Panthers if any third party attempts to initiate any
solicitation, discussion or negotiation with respect to any of the foregoing
transactions.
5.8 Trading in Panthers Common Stock. Except as otherwise expressly
consented to by the Panthers, (i) from the date of this Agreement until the
Effective Time, none of the Partners (or any Affiliates thereof) will directly
or indirectly purchase or sell (including short sales) any shares of Panthers
Common Stock in any transactions effected on the New York Stock Exchange or any
other exchange on which the Panthers Common Stock shall hereafter be traded or
otherwise, or sell, transfer, pledge, dispose of or otherwise part with any
interest in or with respect to or in any other manner reduce their investment
risk with respect to any shares of Panthers Common Stock to be received pursuant
to this Agreement and (ii) during the three (3) year period following the
Effective Date, the Partners will not directly or indirectly sell or purchase or
enter into any agreement, contract or arrangement to sell or purchase any put or
call options or other derivative securities (including any short sales) with
respect to Panthers Common Stock or enter into any other agreements, contracts
or arrangements providing for the alteration of the Shareholders investment risk
with respect to any shares of Panthers Common Stock; provided, however, that the
foregoing shall not prohibit the Shareholders from making outright, unhedged
sales or purchases of Panthers Common Stock after the Closing.
5.9 AZB Management Role, Strategic Affiliation Agreement, Right of
First Offer. After the Closing Date AZB will continue to manage the Resort
pursuant to a management agreement, the form of which is attached as Schedule
5.9(a) (the "Management Agreement"). Panthers and Grossman Company Properties,
Inc. have agreed as of the Closing Date to form a strategic affiliation pursuant
to a Strategic Affiliation Agreement, the form of which is attached as Schedule
5.9(b). Each of Grossman, as trustee of the Grossman Trust, and Carlise has
agreed to provide to Panthers as of the Closing Date a right of first offer with
respect to his ownership interest in all of the Villas Units which he owns or
<PAGE>
controls pursuant to the form of Right of First Offer Agreement attached as
Schedule 5.9(c).
5.10 Execution of Further Documents. From and after the Closing, upon
the reasonable request of any party to this Agreement, the other parties shall
execute, acknowledge and deliver all such further deeds, bills of sale,
assignments, transfers, conveyances, powers of attorney and assurances as may be
required or appropriate to carry out the transactions contemplated by this
Agreement.
5.11 Survey. Within thirty (30) days after the date of this Agreement,
the Partnership shall deliver to Panthers a current ALTA survey of the Owned
Properties (the "Updated Survey") prepared by the Surveyor identified in Section
3.13 and in the same form as the Survey described therein.
5.12 Distribution of Information to Unit Holders. Panthers covenants
and agrees that for so long as any of the Class B, C, D or E Units or the
Warrants remain outstanding, Panthers will use reasonable efforts to provide to
the holders thereof copies of all communications with its stockholders and the
following SEC Filings: Form 10-K, Form 10-Q and Form 8-K; and shall include such
holders on its distribution list for press releases and other public
announcements.
5.13 Audit. Panthers may at any time after the end of the month in
which this Agreement is executed and until December 31, 1998 perform an audit
("Working Capital Audit") of each component of Working Capital as of the most
recent prior Semi-annual Distribution Date (the "Audit Date"). The Partnership
and the Exchange Partners shall cooperate with Panthers in conducting the
Working Capital Audit and in providing the back-up documentation necessary to
perform such audit. The Partnership shall maintain its records regarding Working
Capital in a manner consistent with past practices and shall retain all relevant
financial records for such period as Panthers may reasonably request. The
Working Capital Audit may include, at Panthers' discretion, testing of
subsequent information until December 31, 1998 to confirm Working Capital
balances as of the Audit Date. Should the auditor determine that Working Capital
as of the Audit Date was negative (due to, among other things, uncollectible
accounts receivable or unrecorded Current Liabilities) the Exchange Partners and
the Partners shall remit to the Partnership an amount equal to the difference
between One Dollar ($1.00) and the Working Capital as of the Audit Date, and any
such payment shall be made without regard to Article 8, other than Panthers'
Hold Back and Set Off Rights.
5.14 Fees. The parties agree that any and all costs or fees payable to
unaffiliated third parties (excluding each party's attorneys fees) paid or
incurred by any of them in connection with purchasing or obtaining the items set
forth below shall be paid 50% by Panthers and 50% by the Exchange Partners:
(a) Any required consents, waivers or approvals in connection
with the Debt Facility, or the refinancing thereof, including but not limited to
any application or processing fee, assignment fee, prepayment fee, make-whole
premium or other one-time charges and any charges or expenses of the lender in
<PAGE>
connection with the Debt Facility or any refinancing thereof; provided, however,
that in the event the Partnership elects with the consent of Panthers to borrow
all or any part of the amount of any such prepayment fee or other charges, then
only the portion thereof not borrowed shall be subject to this Section 5.14(a);
(b) Title insurance and title endorsements, including costs to
update or amend the policy insuring the lenders under the Debt Facility or any
refinancing thereof; and
(c) The title insurance policies issued pursuant to the Title
Insurance Commitment and the Updated Survey.
5.15 Debt Facility. As soon as practical after the date hereof, the
parties agree to jointly seek the appropriate consents required concerning the
Debt Facility. If as a condition of granting such approval the holders of such
Debt Facility require payment of more than a one percent (1%) fee or renegotiate
any material terms thereof, then, except as the Exchange Partners and Panthers
may otherwise agree in writing, Panthers shall have the right and shall use its
reasonable best efforts until February 16, 1998, or until March 2, 1998, if
Panthers elects to extend the Closing Date pursuant to Section 1.2, to refinance
the Debt Facility with another loan which would constitute an Approved
Refinancing prior to the Final Replacement Date under the Limited Partnership
Agreement. If Panthers does not obtain such loan prior to the applicable Closing
Date, then either Panthers or the Exchange Partners may thereafter arrange a
refinancing loan which satisfies the foregoing conditions, and the Closing Date
shall be extended from time to time until either party has done so, but in no
event beyond June 30, 1998, without the consent of Panthers and the Exchange
Partners. If prior to the Closing Date, more than one refinancing loan which
satisfies the foregoing conditions becomes available, Panthers may select
between the alternatives. Should the Debt Facility be prepaid or refinanced at
an interest rate that is lower than the existing rate of the Debt Facility (the
"Interest Savings"), then the Exchange Partners shall receive reimbursement of
their portion of the fees paid pursuant to Section 5.14(a) and (b). Such
reimbursement shall be equal to 50% of the Interest Savings and shall be paid by
the Partnership within thirty days after each quarter-end. At its election,
Panthers may also receive reimbursement of its half of the Interest Savings at
the same time and in the same amounts as any payments thereof to Exchange
Partners.
5.16 Deferred Maintenance. Schedule 5.16 lists certain deferred
maintenance and environmental prevention programs. Prior to the Closing Date,
the Partnership shall complete the items on such Schedule.
5.17 Distribution of Exchange Consideration. If any Class B, C, D or E
Units or Warrants will be distributed to Persons who are direct or indirect
partners or members of AZB or W&S as of the date of this Agreement and such
Persons are not parties to this Agreement, then such Persons shall prior to
receiving the units execute an investor representation letter, the form of which
is attached as Schedule 5.17.
5.18 Title. The Partnership shall, prior to Closing, (i) make
arrangements with the title insurer satisfactory to Panthers assuring that,
prior to completion of any trustee's sale pursuant to the insured deed of trust,
all title insurance proceeds payable with respect to the owner's policy and the
<PAGE>
mortgagee's policy will be paid pursuant to the owner's policy; (ii) use its
best efforts to satisfy all requirements set forth in Schedule B Section 1 of
the Title Insurance Commitment; (iii) execute and record an instrument for the
purpose set forth in Schedule 5.18 (unless such instrument would invalidate the
Title Insurance Commitment); and (iv) cause the title insurer also to insure the
Partnership's leasehold interest under the Ground Lease Agreement identified in
Schedule 3.13(b)(i) (the "Ground Lease Parcel"), subject to such additional
exceptions as may exist thereon, except that there shall have been no prior
assignment of or encumbrance granted upon the Partnership's rights under such
Ground Lease Agreement, other than to secure the Debt Facility. The Partnership
shall not take any other action resulting in a change in the condition of title
to the Owned Properties or the Leased Premises prior Closing except with the
consent of Panthers.
5.19 Spa Construction. The Partnership shall pay in the ordinary course
of business consistent with past practice the expenses of the construction of
the Resort health club (the "Spa"). As of the last day of the month in which
this Agreement is executed, the amount due and payable to complete the
construction of the Spa will not be more than $400,000.
5.20 Annual Business Plan and Renovation Projection. On or before
January 31, 1998, AZB shall provide to Panthers (i) the Business Plan of the
Partnership for 1998 consistent with the terms of the Limited Partnership
Agreement and (ii) a Renovation Projection as hereinafter provided. The
Renovation Projection shall include a monthly schedule of projected Renovation
Costs (as defined in the Limited Partnership Agreement). Based on such 1998
Business Plan and the Renovation Projection, on or before January 31, 1998, AZB
shall provide to Panthers its good faith estimate of the maximum cash deficit
which will occur at any time during 1998, taking into consideration both such
projected Renovation Costs and cash flow from operations. The Renovation
Contribution shall be that amount which, together with AZB's good faith estimate
of the amount of interest which will accrue thereon from the Closing Date until
disbursed, equals such maximum cash deficit.
5.21 Liquor and Other Licenses. The Partnership and AZB shall, in
connection with the current annual renewal of the liquor license, cause the
Partnership to be shown as the sole owner thereof. Additionally, with respect to
the liquor license, AZB and the Partnership shall file a site plan with the
State of Arizona Liquor Control Board depicting the entire Resort and Villas
property as the area in which liquor can be served and cause such Board to
evidence of record the release of such liquor license from the Equitable lien.
The Partnership's Affiliates shall also transfer to the Partnership other
licenses, if any, which are necessary for the operation of the Partnership's
business and are currently held by such Affiliates.
ARTICLE VI
CLOSING DATE EVENTS AND DELIVERIES
On or before the Closing Date:
6.1 Exchange Consideration. Panthers SPE shall transfer the Exchange
Consideration to AZB, W&S and/or their designees in accordance with the Limited
Partnership Agreement and shall be admitted to the Partnership as a general
partner.
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6.2 Limited Partnership Agreement. AZB, W&S and Panthers SPE shall
execute and deliver the Limited Partnership Agreement, a Certificate of Limited
Partnership and a statement of qualification as a limited liability limited
partnership in accordance with A.R.S. ss.29-1101, which the Partnership shall
file concurrently with or promptly following the Closing Date.
6.3 Partnership Interests. The Partnership will issue Units to AZB, W&S
and Panthers SPE in accordance with the Limited Partnership Agreement. The AZB
partnership interests shall be limited and general partnership interests as AZB
designates in writing at the Closing. The W&S partnership interests shall be
limited partnership interests.
6.4 Delivery of Closing Documents. At the Closing, each of the
Partnership, the Exchange Partners, the Partners, Panthers and Panthers SPE, as
applicable, shall have, or caused to be, executed and delivered to all
appropriate parties the Management Agreement, Strategic Affiliation Agreement,
Right of First Offer, Warrant Agreement, Assignment and Assumption Agreement in
the form attached hereto as Schedule 6.4(a), Class B Unit Exchange Rights
Agreement (Stock) in the form attached hereto as Schedule 6.4(b), Class C Unit
Exchange Agreement (Stock) in the form attached hereto as Schedule 6.4(c), Class
D Unit Exchange Agreement (Cash) in the form attached hereto as Schedule 6.4(d),
Class E Unit Exchange Agreement in the form attached hereto as Schedule 6.4(e),
Redemption Agreement in the form attached hereto as Schedule 6.4(f), Deed of
Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing in
the form attached hereto as Schedule 6.4(g), Separateness Agreement in the form
attached hereto as Schedule 6.4(h), Assignment of Deed Restriction in the form
attached hereto as Schedule 6.4(i), Default Cure Option Agreement in the form
attached hereto as Schedule 6.4(j), Option Agreement in the form attached hereto
as Schedule 6.4(k) and any and all other documents, assignments, and other
instruments provided for herein or otherwise reasonably required to evidence the
transactions contemplated hereby.
6.5 Partnership Closing Certificate. On the Closing Date, the
Partnership, the Exchange Partners and the Partners shall have performed and
complied in all material respects with all of their respective obligations which
are required by this Agreement to be performed or complied with at or prior to
the Closing. The Partnership and, to the extent applicable, the Exchange
Partners and the Partners shall have delivered to Panthers certificates, dated
as of the Closing, duly signed (in the case of the Partnership, by the Exchange
Partners), certifying (i) that all such obligations of the certifying party have
been complied with and performed in all material respects, (ii) that the
Partnership has not suffered any Material Adverse Change, (iii) that all
representations and warranties of the certifying party set forth in this
Agreement were true when made or specifying in such certificate any errors
therein which have become known to the certifying party as of the Closing Date
and (iv) that the representations and warranties of the certifying party set
forth in Sections 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.7, 3.11, 3.12, 3.13(a),
3.13(e), 3.14(c), 3.15(a), (b), (c) and (d), 3.18, 3.22 (only to the extent
applicable to the other representations and warranties made as of the Closing
Date), 3.23, 3.24, 3.25, 3.26, 3.27, 3.28 and 3.29 continue to be true and
correct in all material respects as if restated in full on and as of the Closing
Date or specifying in such certificate any changes which have occurred in any
such representation or warranty or in the Schedules referred to therein between
<PAGE>
the date of this Agreement and the Closing Date. Notwithstanding the obligation
of the parties to bring forward certain representations and warranties as of the
Closing Date, each party responsible for any such representation and warranty
shall indemnify Panthers and Panthers SPE against any such changes therein
between the date of this Agreement and the Closing Date in accordance with and
subject to the provisions of Article VIII, except for changes approved by
Panthers or Panthers SPE or changes permitted pursuant to Article IV and except
for the representations and warranties set forth in Sections 3.4 (unless there
has been a transfer to a Person who is not currently a Partner or an Affiliate
of a Partner), 3.6, 3.11, 3.15(a), (b), (c) and (d) and 3.18 (so long as valid
policies providing the required coverages are in effect).
6.6 Panthers Closing Certificate. On the Closing Date, Panthers and
Panthers SPE shall have performed and complied with all of their respective
obligations which are required by this Agreement to be performed or complied
with at or prior to the Closing. Panthers and Panthers SPE shall have delivered
to the Partnership and the Exchange Partners certificates, dated as of the
Closing, and signed by a duly authorized executive officer, certifying that all
such obligations have been complied with and performed, that Panthers and
Panthers SPE have not suffered any Material Adverse Change and that all
representations and warranties of Panthers and Panthers SPE continue to be true
and correct in all material respects as if restated in full on and as of the
Closing Date and, except as set forth in such certificate, Panthers has not made
any SEC Filing on or within 5 days prior to the Closing Date.
6.7 Opinions of Counsel.
(a) The Partnership shall have caused its counsel to issue to
Panthers an opinion dated as of the Closing Date, in form and substance
reasonably acceptable to Panthers, to the effect that:
(i) Immediately prior to the execution and delivery
of the Limited Partnership Agreement, the Partnership is a general
partnership, duly organized and validly existing under the laws of the
State of Arizona, has the requisite power and authority to carry on the
business as is now being conducted by it and to own or lease the
properties now owned or leased by it. Immediately following the Closing
and assuming the due execution and delivery of the Limited Partnership
Agreement by, and the capacity and authority of, Panthers SPE and the
due filing of a Certificate of Limited Partnership and statement of
qualification as a limited liability limited partnership in form
approved by such counsel, the Partnership will be a limited liability
limited partnership duly organized and validly existing under the laws
of the State of Arizona and will have the requisite power and authority
to carry on its business and own or lease its properties as
contemplated by this Agreement.
(ii) The Partnership has obtained all necessary
authorizations and consents of its partners, and any other required
consents under its certificate of partnership and partnership
agreement, as the case may be, to effect the transactions contemplated
hereunder;
<PAGE>
(iii) Each of the Exchange Partners and the Partners
has the power and authority to execute and deliver this Agreement, the
Limited Partnership Agreement, the Management Agreement, and the
Strategic Affiliation Agreement (collectively, the "Transaction
Agreements") to which it is a party, to perform its respective
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby or thereby. Each of the Partners has taken all
action necessary to authorize the execution and delivery of the
Transaction Agreements to which it is a party, including obtaining all
required consents required by its respective formation documents, if
applicable, and the performance of its respective obligations hereunder
and thereunder and the consummation of the transactions contemplated
hereby and thereby;
(iv) The execution and delivery of the Transaction
Agreements by each of the Exchange Partners to which it is a party and
the performance of its respective agreements in the Transaction
Agreements do not violate its respective formation documents;
(v) Except as disclosed in such opinion, such counsel
after due inquiry does not know that there is any litigation pending
against the Partnership or the Exchange Partners in state or federal
court in the State of Arizona which might result in any Material
Adverse Change in the business or in the financial condition of the
Partnership; and
(vi) The Transaction Agreements have been duly
executed and delivered and constitute a valid and binding obligation of
the Partnership and the Partners, and are enforceable against the
Partnership and the Partners, in accordance with their respective
terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the enforcement of
creditors' rights generally or general equitable principles and other
exceptions to enforceability contained in the standard form of legal
opinion recommended by the State Bar of Arizona, and except that no
opinion shall be required with respect to non-competition agreements.
(b) Panthers shall have caused its counsel to issue to the
Partnership and the Exchange Partners an opinion dated as of the Closing Date in
form and substance reasonably acceptable to the Partnership and the Exchange
Partners, to the effect that:
(i) Each of Panthers and Panthers SPE is a
corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware and has the requisite power and
authority to carry on its business as it is now being conducted;
(ii) Each of Panthers and Panthers SPE has the power
and authority to execute and deliver the Transaction Agreements and the
Exchange Rights Agreements to which it is a party, to perform its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby or thereby. Each of Panthers and Panthers SPE has
taken all action necessary to authorize the execution and delivery of
the Transaction Agreements and the Exchange Rights Agreements to which
<PAGE>
it is a party, including obtaining all required consents required by
its respective Articles of Incorporation and Bylaws, which consents
have been validly obtained, and the performance of its respective
obligations hereunder and thereunder and the consummation of the
transactions contemplated hereby and thereby;
(iii) The execution and delivery of the Transaction
Agreements and the Exchange Rights Agreements by each of Panthers and
Panthers SPE to which it is a party and the performance of its
respective agreements in the Transaction Agreements and the Exchange
Rights Agreements do not violate its respective Articles of
Incorporation or Bylaws;
(iv) Each of the Transaction Agreements, Strategic
Affiliation Agreement and the Exchange Rights Agreements has been duly
executed and delivered by Panthers and Panthers SPE, as applicable, and
constitutes its legal, valid and binding obligation, enforceable
against Panthers and Panthers SPE, as applicable, in accordance with
their terms, except as the same may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally or general
equitable principles and other exceptions to enforceability contained
in the standard form of legal opinion recommended by the State Bar of
Florida, and except that no opinion shall be required with respect to
non-competition agreements;
(v) Except as disclosed in such opinion, such counsel
after due inquiry does not know that there is any litigation pending
against Panthers in state or federal court in the States of Florida and
Delaware which might result in any Material Adverse Change in the
business or in the financial condition of Panthers.
6.8 Assignment of Rental Pool Agreement, Termination of Certain
Affiliate Agreements. On the Closing Date, but effective at or prior to the end
of the month during which this Agreement is executed, the Partnership shall have
received: (i) an assignment from certain Affiliates of those agreements set
forth in part 1 of Schedule 6.8; and (ii) evidence satisfactory to Panthers that
all other Affiliate Agreements listed in part 2 of Schedule 6.8 have been
terminated.
ARTICLE VII
CONDITIONS
7.1 Conditions to the Obligations of the Panthers. The obligations of
the Panthers and Panthers SPE to effect the transactions contemplated hereunder
shall be subject to the fulfillment at or prior to the Closing of the following
conditions, any or all of which may be waived in whole or in part by Panthers:
<PAGE>
(a) No Material Adverse Change or Destruction of Property.
Between the date hereof and the Closing Date, (i) there shall have been no
Material Adverse Change to the Partnership, (ii) there shall have been no
adverse federal, state or local legislative or regulatory change affecting in
any material respect the properties, assets, services or business of the
Partnership, and (iii) none of the properties and assets of the Partnership
shall have been damaged by fire, flood, casualty, act of God or the public enemy
or other cause (regardless of insurance coverage for such damage) which damages
have a Material Adverse Effect thereon.
(b) Debt Facility. The Partnership shall have received all
necessary and appropriate consents under or shall have refinanced the Debt
Facility. On the Closing Date, the principal balance of the Debt Facility, if
not previously refinanced, will not exceed in the aggregate Sixty Three Million
Three Hundred and Fifty Thousand Dollars ($63,350,000.00).
(c) No Adverse Litigation. There shall not be pending or
threatened any action or proceeding by or before any court or other governmental
body which shall restrain, prohibit, or seek to rescind or invalidate or collect
damages in a material amount arising out of any action or transaction provided
for herein and which, in the reasonable judgment of Panthers, upon advice of its
legal counsel after consultation with the Exchange Partners, has a substantial
likelihood of success on its merits and makes it inadvisable to proceed with the
transaction.
(d) HSR Act Waiting Period. Any applicable HSR Act waiting
period shall have expired or been terminated.
(e) Accounting Treatment. There shall not have been a change
in the rules promulgated by the Securities and Exchange Commission which does
not permit Panthers to consolidate for financial reporting purposes all of the
results of operations of the Partnership; provided, however, that in the event
of any such change, Panthers will promptly notify the Exchange Partners thereof
and the parties will in good faith, with the assistance of their independent
accountants and legal counsel, endeavor to restructure the transaction in such a
manner as to allow consolidation without materially altering the substantive
rights of the parties hereunder.
(f) Title Policy. On and as of the Closing Date, the title
insurer (or Old Republic Title Insurance Company or other title insurer
acceptable to the parties) shall have irrevocably committed to issue title
insurance identical to the Title Insurance Commitment (deleting Schedule B,
Section 1 and items 1 and 45 of Schedule B, Section 2) and adding the
endorsements described in items (i) and (iii) of Section 5.18 herein and
containing an endorsement in the form of Schedule 7.1(f) attached hereto, or
shall have issued the title insurance policies pursuant thereto with the above
deletions and endorsements and without any additional title matters being added
to Schedule B thereof.
(g) Partnership Tax Return. The Partnership shall have duly
executed and filed with the Internal Revenue Service its annual tax return on
Form 1065 for the period ended December 31, 1997, including all required
schedules thereto and including an election under ss.754 of the Internal Revenue
Code.
7.2 Conditions to the Obligations of the Partnership, the Exchange
Partners and the Partners. The obligations of the Partnership, the Exchange
Partners and the Partners to effect the transactions contemplated hereunder
shall be subject to the fulfillment at or prior to the Closing of the following
conditions, any or all of which may be waived in whole or in part by the
Exchange Partners:
<PAGE>
(a) No Material Adverse Change. Between the date hereof and
the Closing Date there shall have been no Material Adverse Change to Panthers or
Panthers SPE, and Panthers shall have delivered to the Partners a certificate to
that effect, dated the Closing Date and signed by a duly authorized officer of
Panthers. The market value of Panthers' Common Stock shall be immaterial to the
question of whether Panthers has suffered a Material Adverse Change.
(b) Debt Facility. The Partnership shall have received all
necessary and appropriate consents under or shall have refinanced the Debt
Facility. On the Closing Date, the principal balance of the Debt Facility, if
not previously refinanced, will not exceed in the aggregate Sixty Three Million
Three Hundred and Fifty Thousand Dollars ($63,350,000.00).
(c) No Adverse Litigation. There shall not be pending or
threatened any action or proceeding by or before any court or other governmental
body which shall restrain or prohibit or seek to rescind or invalidate or
collect damages in a material amount arising out of any action or transaction
provided for herein and which in the judgment of the Exchange Partners, upon
advice of their legal counsel after consultation with Panthers, has a
substantial likelihood of success on its merits and makes it inadvisable to
proceed with the transactions.
(d) HSR Act Waiting Period. Any applicable HSR Act waiting
period shall have expired or been terminated.
(e) Title Policy. On and as of the Closing Date, the title
insurer shall have reissued the Title Insurance Commitment (deleting Schedule B,
Section 1 and items 1 and 45 of Schedule B, Section 2) and adding the
endorsements described in items (i) and (iii) of Section 5.18 herein, or shall
have issued the title insurance policies pursuant thereto with the above
deletions and endorsements and without any additional title matters being added
to Schedule B thereof.
7.3 Extension of Closing Date. In the event that all conditions to
Closing have not been satisfied or waived as of the scheduled Closing Date, the
Closing Date shall be extended from time to time until all such conditions have
been satisfied or waived or until this Agreement is duly terminated pursuant to
Article X hereof.
ARTICLE VIII
INDEMNIFICATION
8.1 Agreement by the Parties to Indemnify.
(a) Subject to the limitations set forth herein below, each of
the Exchange Partners and the Partners, jointly and severally, but only to the
extent of the Exchange Consideration, agrees to indemnify and hold Panthers and
Panthers SPE harmless from and against the aggregate of all expenses, losses,
costs, deficiencies, liabilities and damages (including, without limitation,
related counsel and paralegal fees and expenses) incurred or suffered by
Panthers arising out of or resulting from (i) any breach of a representation or
<PAGE>
warranty made by the Partnership, the Exchange Partners and the Partners in or
pursuant to this Agreement, (ii) any breach of the covenants or agreements made
by any of the Partnership, the Exchange Partners or the Partners in or pursuant
to this Agreement and (iii) any inaccuracy in any certificate, schedule or any
other document to be delivered at Closing by any of the Partnership, the
Exchange Partners or the Partners pursuant to this Agreement. Without limiting
the generality of the foregoing, but subject to the limitations set forth below,
with respect to the measurement of Indemnifiable Damages, Panthers shall have
the right to be put in the same pre-tax consolidated financial position as it
would have been in had each of the representations and warranties of the
Partnership, the Exchange Partners and the Partners hereunder been true and
correct and had the covenants and agreements of the Partnership and the Partners
hereunder and thereunder been performed in full.
(b) Subject to the limitations set forth herein below,
Panthers agrees to indemnify and hold the Partnership, the Exchange Partners and
the Partners harmless from and against the aggregate of all expenses, losses,
costs, deficiencies, liabilities and damages (including without limitation,
related counsel and paralegal fees and expenses) incurred or suffered by the
Partnership, the Exchange Partners and the Partners arising out of or resulting
from (i) any breach of a representation or warranty made by Panthers or Panthers
SPE in or pursuant to this Agreement; (ii) any breach of the covenants or
agreements made by Panthers or Panthers SPE in or pursuant to this Agreement;
and (iii) any inaccuracy in any certificate, schedule or any other document to
be delivered at Closing by Panthers or Panthers SPE pursuant to this Agreement.
Without limiting the generality of the foregoing, but subject to the limitations
set forth below, with respect to the measurement of Indemnifiable Damages, each
of the Partnership, the Exchange partners and the Partners shall have the right
to be put in the same pre-tax financial position as it would have been in had
each of the representations and warranties of Panthers and Panthers SPE
hereunder been true and correct and had the covenants and agreements of Panthers
and Panthers SPE hereunder and thereunder been performed in full.
8.2 Procedure for Indemnification. Promptly after receipt by an
indemnified party pursuant to the provisions of Sections 8.1 hereof of notice of
the commencement of any action involving the subject matter of the foregoing
indemnity provisions, such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of said paragraph
(a) or (b), promptly notify the indemnifying party of the commencement thereof;
but the omission to so notify the indemnifying party will not relieve it from
any liability which it may have hereunder unless the indemnifying party has been
materially prejudiced thereby nor will such failure to so notify the
indemnifying party relieve it from any liability which it may have to any
indemnified party otherwise than hereunder. In case such action is brought
against any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall have the right to participate
in, and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, if the defendants in
any action include both the indemnified party and the indemnifying party and
there is a conflict of interest which would prevent counsel for the indemnifying
party from also representing the indemnified party, the indemnified party or
parties shall have the right to select separate counsel to participate in the
defense of such action on behalf of such indemnified party or parties. After
notice from the indemnifying party to such indemnified party of its election so
<PAGE>
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party pursuant to the provisions of said paragraph (a) or (b) for
any legal or other expense subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation, unless (i) the indemnified party shall have employed counsel in
accordance with the provisions of the preceding sentence, (ii) the indemnifying
party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after the notice of the
commencement of the action, or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party.
8.3 Survival of Representations, Warranties and Covenants. Each of the
representations, warranties and covenants made by the parties in this Agreement
shall survive for a period of one (1) year after the Closing Date (the "Survival
Period"), except that the Survival Period for the matters set forth in the
following Sections shall be two (2) years: 2.1; 2.2; 2.3; 2.4; 2.5; 3.1; 3.2;
3.3; 3.4; 3.6; 3.12; 3.13(e); and the first four sentences of 3.18. In addition,
(i) the Survival Period for any matter in Section 3.31 shall equal the
applicable statute of limitations for the subject Tax or tax filing, (ii) any
covenant or other obligation which by its terms is to be performed following
Closing shall survive without limitation by this provision, and (iii) after
expiration of such one year period Panthers shall not have any rights or
remedies resulting from breach of any of the representations or warranties set
forth in Sections 3.23 through 3.29, inclusive, except that, with respect to any
suit, claim or proceeding brought by the party making such representations and
warranties which is based in whole or in part upon allegations which are
inconsistent therewith, such representations and warranties may be asserted as a
defense or as a counterclaim, provided that such counterclaim shall not seek
damages in excess of the amount of such claim plus reasonable attorneys fees. No
claim for the recovery of Indemnifiable Damages may be asserted by one of the
parties against another after such representations and warranties shall thus
expire, provided, however, that claims for Indemnifiable Damages first asserted
within the applicable period shall not thereafter be barred except by any
applicable statute of limitations. Notwithstanding any knowledge of facts
determined or determinable by any party by investigation, each party shall have
the right to fully rely on the representations, warranties, covenants and
agreements of the other parties contained in this Agreement or in any other
documents or papers delivered in connection herewith. Each representation,
warranty, covenant and agreement of the parties contained in this Agreement is
independent of each other representation, warranty, covenant and agreement.
8.4 Threshold and Maximum Indemnification Amount. Anything
contained in this Agreement to the contrary notwithstanding, (i) the parties to
this Agreement shall not be liable for any amounts for which an indemnified
party is otherwise entitled to indemnification until the amount of the
Indemnifiable Damages (excluding any indemnification under Sections 3.12 and
3.14(c) and excluding each Single Loss, as defined below, less than $25,000)) in
the aggregate exceeds $1,000,000 (the "Threshold"), in which case the
indemnified party shall be entitled to the amount of all such Indemnifiable
Damages in excess of the Threshold and (ii) except with respect to certain
representations, warranties and covenants expressly set forth below, the parties
shall not be required to pay Indemnifiable Damages pursuant to this Article to
the extent such Indemnifiable Damages would exceed in the aggregate the Maximum
<PAGE>
Indemnification Amount (as that term is defined in Schedule 8.4, it being
understood that each of the Threshold and the Maximum Indemnification Amount
shall be applied on an aggregate basis for all claims and all indemnifying
parties and not on a per claims basis, except as provided above. None of the
parties shall be obligated to indemnify the other for any Single Loss covered by
Section 8.1 (consolidating into any Single Loss any series of related events,
facts or circumstances giving rise to Indemnifiable Damages on the same or a
substantially related factual basis (after giving effect to such consolidation,
a "Single Loss")) unless such Single Loss exceeds $25,000, in which case the
indemnifying party shall be obligated to indemnify the indemnified party to the
extent that the sum of all Single Losses in excess of $25,000 exceeds the
Threshold and is less than the Maximum Indemnification Amount. Notwithstanding
the foregoing, the Maximum Indemnification Amount shall not limit Indemnifiable
Damages arising from breaches of the representations and warranties contained in
Sections 2.1, 2.2, 2.3, 2.4, 2.5, 3.1, 3.2, 3.3, 3.4, the second sentence of
3.13(a), the last sentences of 3.14(c), the first five sentences of 3.18 or
3.31, from breach of the covenant contained in the last sentence of Section
5.18, from breach of Panthers' covenants to pay, provide and perform its
obligations with respect to the Exchange Consideration or from breach of any
obligation which by its terms is to be performed following Closing. All other
covenants, representations and warranties are subject to the Maximum
Indemnification Amount. Any amount of indemnification payments which any party
would be required to make under this Section but for the Threshold and Maximum
Indemnification Amount is hereinafter referred to as "Indemnifiable Damages". In
determining the foregoing Threshold and Maximum Indemnification Amount and in
otherwise determining the amount to which an indemnified party is entitled to
assert a claim for indemnification pursuant to this Article, only actual losses,
and not consequential or other special damages or losses, shall be
indemnifiable. Both parties hereto waive any claim to exemplary or punitive
damages. Indemnifiable Damages arising from the breach of more than one
representation and warranty or any combination of breaches shall only be
recovered once. The indemnified party agrees to use its reasonable best efforts
to mitigate its claims for indemnification hereunder, including, without
limitation, by seeking recovery for its losses and damages under applicable
insurance policies.
8.5 Security for the Indemnitors' Indemnification Obligation. As
security for the agreement by the Partnership, Exchange Partners and Partners to
indemnify and hold Panthers and Panthers SPE harmless as described in this
Article, Panthers shall have the rights of Hold Back and Set Off set forth
below.
(a) Panthers' Hold Back Rights shall be as follows. In the
event that, following the exercise of any redemption rights by a holder of any
Class B, C or E (to the extent currently payable) Units, the total redemption
value, whether in cash or stock, of the remaining Class B, C or E (to the extent
currently payable) Units is less than $11,500,000 minus all amounts previously
paid by any indemnitor, Set Off by Panthers or transferred to the Escrow Agent
(as hereinafter defined) (the "Set Off Deficit"), Panthers may pay or deliver
the portion of the proceeds of such exercise which is equal to such Set off
Deficit to an Escrow Agent (the "Held Back Consideration"). Escrow Agent shall
hold all cash in an interest bearing savings account or, if the redeeming holder
has elected to receive Panthers Common Stock, shall hold such stock in the form
received (in its own name or, at the election of Escrow Agent, the name of such
holder, who shall provide all necessary endorsements and/or stock powers) until
such stock is sold or released pursuant to the following provisions. The Holder
owning such stock may direct Escrow Agent to sell it at any time. In the event
<PAGE>
Panthers exercises Set Off rights with respect to stock held in escrow, Escrow
Agent shall sell only the number of shares necessary to produce the amount of
cash required to satisfy such claim. Any cash held by Escrow Agent at any time
in excess of $11,500,000 less all amounts previously Set Off by Panthers shall
be released to the holder (or pro rata among the holders) entitled thereto. On
the earlier of (i) the second anniversary of the Closing Date or (ii) the date
on which Panthers has exercised all of its Set Off Rights, any balance of such
Held Back Consideration shall be disbursed to the Exchange Partners. Prior to
such time, Held Back Consideration shall be disbursed to Panthers only pursuant
to the due exercise of its Set Off Rights, as set forth below. Each party agrees
to execute any supplemental agreement or escrow instructions consistent with the
provisions hereof requested by such Escrow Agent and to be jointly and severally
liable for all costs and fees of such Escrow Agent, which shall be divided 50%
to Panthers and 50% to the Exchange Partners.
(b) Panthers' Set Off Rights shall be as follows. Panthers may
set off against the Held Back Consideration and/or against any unexercised Class
B, C or E Units (the "Additional Consideration") up to the total amount of
$11,500,000. Set Off Rights shall be exercised first against any Held Back
Consideration and then against the Additional Consideration. Panthers may Set
Off only for Indemnifiable Damages and only upon and subject to the following
terms and conditions:
(i) Panthers shall first give written notice to the
Exchange Partners and, if applicable, Escrow Agent, of any claim for
Indemnifiable Damages, which notice shall set forth (a) the amount
claimed (b) a detailed statement of the basis of such claim;
(ii) Such Set-Off shall be effected on the later to
occur of (a) 10 days after the date of such notice (the "Contest
Period") or (b) if such claim is contested within such 10 day period as
hereinafter provided in clause (iii), the date the dispute is resolved.
(iii) If, prior to the expiration of the Contest
Period, any of the Partnership, the Exchange Partners or the Partners
shall notify Panthers in writing of an intention to dispute the claim
and if such dispute is not resolved within 30 days after the date of
such notice (the "Resolution Period"), then Panthers may elect that
such dispute shall be resolved by a committee of three arbitrators (one
appointed by the Indemnitors, one appointed by Panthers and one
appointed by the two arbitrators so appointed), which shall be
appointed within 60 days after the expiration of the Resolution Period.
The arbitrators shall abide by the rules of the American Arbitration
Association and their decision shall be made within 45 days of being
appointed and shall be final and binding on all parties.
8.6 Expiration of Hold Back and Set Off Rights. All of Panthers' Hold
Back and Set Off Rights shall expire on the second anniversary of the Closing
Date, unless there then remains unresolved any Set Off claim as to which notice
has previously been given, in which event any Held Back Consideration remaining
in escrow after such claim shall have been satisfied or resolved shall be
returned to the Exchange Partners.
<PAGE>
8.7 Adjustment to Consideration for Transactions Contemplated
Hereunder. All payments of Indemnifiable Damages made pursuant to this Article
shall be treated as adjustments to the consideration granted in Section 1.4
above.
8.8 Exclusivity of Remedies. The remedies set forth in this Article
VIII shall be exclusive except as herein expressly provided and except that any
party may maintain an action to recover its Indemnifiable Damages and/or seek
equitable remedies. In the event of fraud, Panthers shall have only the remedies
set forth above and the additional remedy of rescission and restitution, unless
such fraud was committed by any or all of Grossman, Carlise or Crow personally
and individually, in which event Panthers shall have all remedies available at
law or in equity.
ARTICLE IX
DEFINITIONS
9.1 Defined Terms. As used herein, the following terms shall have the
following meanings:
"Affiliate" shall have the meaning ascribed to it in Rule 12b-2 of the
General Rules and Regulations under the Exchange Act, as in effect on the date
hereof.
"Contract" means any agreement, contract, lease, note, mortgage,
indenture, loan agreement, franchise agreement, covenant, employment agreement,
license, instrument, purchase and sales order, commitment, undertaking,
obligation, whether written or oral, express or implied.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with any Person, are treated as a single employer
under Section 414(b) or 414(c) of the Internal Revenue Code.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Agreements" means the Warrant Agreements and the agreements
set forth in Schedules 6.4, (b), (c), (d), (e) and (f).
"GAAP" means generally accepted accounting principles in effect in the
United States of America from time to time.
"Governmental Authority" means any nation or government, any state,
regional, local or other political subdivision thereof, and any entity or
official exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
<PAGE>
"Knowledge," with respect to the Partnership, the Exchange Partners or
the Partners, means the actual knowledge, after reasonable inquiry, of Grossman,
Carlise, Crow, Jim Ball (Managing Director of the Resort), Jim Myers (Director
of Food and Beverage Services), Tom Nelson (Controller), Paul Holste (Chief
Financial Officer), Anton Nikodemus (Director of Operations), Rob Stowe
(Director of Engineering) and Cindy Jones (Director of Human Resources).
"Legal Requirements" means all applicable laws, statutes, ordinances,
rulings, regulations, codes, decrees, orders, judgments, covenants, conditions,
restrictions, approvals, permits and requirements under any Permitted Exception
or for, from or by any Governmental Authority, including zoning, subdivision,
use, environmental, building, safety, health, housing and fire.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including, but not limited to, any conditional sale or
other title retention agreement, any lease in the nature thereof, and the filing
of or agreement to give any financing statement under the Uniform Commercial
Code or comparable law or any jurisdiction in connection with such mortgage,
pledge, security interest, encumbrance, lien or charge).
"Material Adverse Change (or Effect)" means a change to (or effect) in
the condition (financial or otherwise), properties, assets, liabilities, rights,
obligations, operations or business, which change (or effect) individually or in
the aggregate is materially adverse to such condition, properties, assets,
liabilities, rights, obligations, operations or business taken as a whole.
"Person" means an individual, partnership, corporation, business trust,
joint stock company, estate, trust, unincorporated association, joint venture,
Governmental Authority or other entity, of whatever nature.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Part 3 of Title I
of ERISA or Section 412 of the Code and is either (a) maintained by any Person
or any member of a Controlled Group for employees of such Person or any member
of such Controlled Group or (b) maintained pursuant to a collective bargaining
agreement or any other arrangement under which more than one employer makes
contributions and to which such Person or any member of a Controlled Group is
then making or has any obligation to make contributions or, within the preceding
five plan years, has made or has had any obligation to make contributions.
"Register", "registered" and "registration" refer to a registration of
the offering and sale of securities effected by preparing and filing a
registration statement in compliance with the Securities Act and the declaration
or ordering of the effectiveness of such registration statement.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
<PAGE>
"Semi-annual Distributions" means a distribution made as of each June
30 and December 31 by the Partnership to its partners. The Semi-annual
Distributions shall not exceed the Partnership's Working Capital.
"Tax Return" means any tax return, filing or information statement
required to be filed in connection with or with respect to any Taxes; and
"Taxes" means all taxes, fees or other assessments, including, but not
limited to, income, excise, property, sales, franchise, intangible, withholding,
social security and unemployment taxes imposed by any federal, state, local or
foreign governmental agency, and any interest or penalties related thereto.
"Working Capital" shall have the meaning set forth on Schedule 9.1.
9.2 Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificates, reports or other documents made or
delivered pursuant hereto or thereto, unless the context otherwise requires.
(b) Terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.
(c) All matters of an accounting nature in connection with
this Agreement and the transactions contemplated hereby shall be determined in
accordance with GAAP, applied on a basis consistent with prior periods, where
applicable.
(d) As used herein, the neuter gender shall also denote the
masculine and feminine, and the masculine gender shall also denote the neuter
and feminine, where the context so permits.
ARTICLE X
TERMINATION
10.1 Termination. This Agreement may be terminated only under the
following circumstances:
(a) by mutual written consent of Panthers and the
Exchange Partners;
(b) by Panthers, in the event of a breach by any of the
Partnership, the Exchange Partners or the Partners of any provision of this
Agreement which would have a Material Adverse Effect upon the Partnership or
upon the rights or benefits of Panthers or Panthers SPE hereunder;
(c) by the Exchange Partners in the event of a breach by
Panthers or Panthers SPE of any provision of this Agreement which would have a
Material Adverse Effect on the rights or benefits of the Partnership, the
Exchange Partners or the Partners hereunder; or
<PAGE>
(d) by either Panthers or the Exchange Partners (provided that
the terminating party has satisfied or made all reasonable and diligent efforts
to satisfy all closing conditions applicable to it), if the Closing shall not
have occurred by May 31, 1998, or such later date to which the Closing Date may
be extended pursuant to Section 5.15.
10.2 Effect of Termination. In the event of termination of this
Agreement pursuant to Section 10.1, this Agreement shall forthwith become void
and of no further force and effect and the parties shall be released from any
and all obligations hereunder; except that the provisions of Section 5.6 shall
survive, as applicable, and except that if any party terminates due to default
pursuant to 10.1(b) or (c), it shall have all rights and remedies set forth
herein or otherwise available at law or in equity.
ARTICLE XI
GENERAL PROVISIONS
11.1 Notices. All notices, requests, demands, claims, and other
communications hereunder shall be in writing and shall be delivered by certified
or registered mail (first class postage pre-paid), guaranteed overnight
delivery, or facsimile transmission if such transmission is confirmed by
delivery by certified or registered mail (first class postage pre-paid) or
guaranteed overnight delivery, to the following addresses and telecopy numbers
(or to such other addresses or telecopy numbers which such party shall designate
in writing to the other party):
(a) if to the Panthers:
Florida Panthers Holdings, Inc.
450 East Las Olas Blvd., Suite 1400
Ft. Lauderdale, FL 33301
Attn: Richard Handley
Telephone: (954) 627-5000
Facsimile: (954) 627-5080
with a copy to:
Akerman, Senterfitt & Eidson, P.A.
One Southeast Third Avenue, 28th Floor
Miami, Florida 33131
Attention: Stephen K. Roddenberry, Esq.
Telephone:
Facsimile: (305) 374-5095
<PAGE>
(b) if to any of the Partnership, the Exchange Partners
or the Partners:
Grossman Company Properties
3003 North Central Avenue, 13th Floor
Phoenix, Arizona 85012
Attention: W. Matthew Crow
Telephone: (602) 285-1300
Facsimile: (602) 285-1321
with a copy to:
Fennemore Craig
3003 North Central Avenue, Suite 2600
Phoenix, Arizona 85012
Attn: Gregg Hanks
Telephone: (602) 916-5309
Facsimile: (602) 916-5999
Notice shall be deemed given on the date sent if sent by overnight
delivery or facsimile transmission and on the date delivered (or the date of
refusal of delivery) if sent by certified or registered mail.
11.2 Entire Agreement. This Agreement (including the Schedules attached
hereto) and other documents to be delivered at the Closing pursuant hereto,
contains the entire understanding of the parties in respect of its subject
matter and supersedes all prior agreements and understandings (oral or written)
between or among the parties with respect to such subject matter[; provided,
however, that the Confidentiality and Standstill Agreement dated November 2,
1997, between the Partnership and Panthers as extended from time to time shall
remain in effect with respect to any breach of confidentiality which occurred
prior to the date of this Agreement]. The Schedules constitute a part hereof as
though set forth in full above.
11.3 Amendment; Waiver. This Agreement may not be modified, amended,
supplemented, canceled or discharged, except by written instrument executed by
all parties. No failure to exercise, and no delay in exercising, any right,
power or privilege under this Agreement shall operate as a waiver, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
the exercise of any other right, power or privilege. No waiver of any breach of
any provision shall be deemed to be a waiver of any preceding or succeeding
breach of the same or any other provision, nor shall any waiver be implied from
any course of dealing between the parties. No extension of time for performance
of any obligations or other acts hereunder or under any other agreement shall be
deemed to be an extension of the time for performance of any other obligations
or any other acts. The rights and remedies of the parties under this Agreement
are in addition to all other rights and remedies, at law or equity, that they
may have against each other.
<PAGE>
11.4 Binding Effect; Assignment. The rights and obligations of this
Agreement shall bind and inure to the benefit of the parties and their
respective successors and assigns. Nothing expressed or implied herein shall be
construed to give any other person any legal or equitable rights hereunder.
Except as expressly provided herein, the rights and obligations of this
Agreement may not be assigned by any of the parties without the prior written
consent of the other party.
11.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one and the same instrument.
11.6 Expenses. Except as otherwise provided herein, the parties shall
pay their own fees and expenses, including their own counsel fees, incurred in
connection with this Agreement or any transaction contemplated hereby.
11.7 Interpretation. When a reference is made in this Agreement to an
article, section, paragraph, clause or schedule, such reference shall be deemed
to be to this Agreement unless otherwise indicated. The headings contained
herein and on the schedules are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement or the schedules.
Whenever the words "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation." Time shall be of the essence in this Agreement.
11.8 Governing Law; Interpretation. This Agreement shall be construed
in accordance with and governed for all purposes by the laws of the State of
Arizona applicable to contracts executed and to be wholly performed within such
State.
11.9 Arm's Length Negotiations. Each party herein expressly represents
and warrants to all other parties hereto that (a) before executing this
Agreement, said party has fully informed itself of the terms, contents,
conditions and effects of this Agreement; (b) said party has relied solely and
completely upon its own judgment in executing this Agreement; (c) said party has
had the opportunity to seek and has obtained the advice of counsel before
executing this Agreement; (d) said party has acted voluntarily and of its own
free will in executing this Agreement; (e) said party is not acting under
duress, whether economic or physical, in executing this Agreement; and (f) this
Agreement is the result of arm's length negotiations conducted by and among the
parties and their respective counsel.
11.10 Severability. In the event that any provision of this Agreement
is found to be void or unenforceable by a court of competent jurisdiction, such
provision shall be reformed to the extent possible to achieve the intention of
the parties as set forth in this Agreement, and this Agreement and the remaining
provisions hereof shall nevertheless remain in full force and effect and be
binding upon the parties with the same effect as though the void or
unenforceable part had been severed or deleted.
[Rest of page intentionally blank]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
FLORIDA PANTHERS HOLDINGS, INC.,
a Delaware corporation
By: WILLIAM M. PIERCE
Name: William M. Pierce
Title: Senior Vice President
WRIGHT-BILT CORP.,
a Delaware corporation
By: WILLIAM M. PIERCE
Name: William M. Pierce
Title:
BILTMORE HOTEL PARTNERS,
an Arizona general partnership
By: AZB LIMITED PARTNERSHIP,
a Delaware limited partnership,
Its General Partner
By: AZ BILTMORE HOTEL
LIMITED PARTNERSHIP,
a Delaware limited partnership,
Its General Partner
By: GROSSMAN INVESTMENT
CORP.,
an Arizona corporation,
Its General Partner
By: W. MATTHEW CROW
Name: W. Matthew Crow
Title: President
THE CROW IRREVOCABLE TRUST
By: BILL B. CROW
Bill B. Crow, not individually but
as trustee
W&S REALTY INVESTMENT GROUP, LLC,
an Arizona limited liability company
By: AZ BILTMORE HOTEL
LIMITED PARTNERSHIP,
a Delaware limited partnership,
Its Manager
By: GROSSMAN INVESTMENT CORP.,
an Arizona corporation,
Its General Partner
By: SAMUEL M. GROSSMAN
Name: Samuel M. Grossman
Title:Chairman
SAMUEL M. GROSSMAN
Samuel M. Grossman
CHARLES CARLISE
Charles Carlise
W. MATTHEW CROW
W. Matthew Crow
AZ BILTMORE HOTEL LIMITED
PARTNERSHIP,
a Delaware limited partnership
By: GROSSMAN INVESTMENT CORP.,
an Arizona corporation,
Its General Partner
By: SAMUEL M. GROSSMAN
Its: Chairman
GROSSMAN INVESTMENT CORP.,
an Arizona corporation
By: SAMUEL M. GROSSMAN
Its: Chairman
SOUTHWEST ASSOCIATES,
an Illinois general partnership
By: HICKORY TRUST, a general partner
By: SOLOMON A. WEISGAL
Solomon A. Weisgal,
its trustee executed not individually
but solely as trustee and nothing contained
herein shall create any liability on or
require performance of any covenant by the
trustee individually, any liability being
limited to the assets of such trust
EL CAMINO ASSOCIATES,
an Arizona general partnership
By: A. ENNIS DALE
A. Ennis Dale, not individually
but as trustee of the Miro Trust,
General Partner
<PAGE>
EXHIBIT 99.1
For Immediate Release
Contact: Stan Smith
(954) 627-5021
- --------------------------------------------------------------------------------
FLORIDA PANTHERS HOLDINGS, INC. CLOSES ON ARIZONA BILTMORE HOTEL
- --------------------------------------------------------------------------------
Fort Lauderdale, Florida (March 3, 1998) - Florida Panthers Holdings,
Inc. (NYSE:PAW) today announced that it has closed on its acquisition of the
Arizona Biltmore Hotel in partnership with its current owners Grossman Company
Properties. The consideration paid totaled $226 million of which $126 million
was paid in cash at closing and another $100 million is payable in cash or Class
A Common Stock at the option of the current owners. Existing debt of $63.4
million was also assumed.
Designed by famed architect Frank Lloyd Wright in 1929, the prestigious
Arizona Biltmore Hotel is situated on 39 acres and located in the Squaw Peak
foothills of Phoenix. The resort includes 620 guest rooms, three full-service
restaurants, access to two 18-hole golf courses, an 18-hole putting course, 8
tennis courts, 6 swimming pools, a full-service conference center accommodating
groups up to 1,200 and The Pavilion (a state-of-the-art function facility
accommodating up to 1,400 people). The resort completed a $50 million
property-wide renovation and expansion program in 1996 and added a 20,000 square
foot spa complex in 1997. It is expected that 120 additional guestrooms will be
constructed in 1998, along with meeting rooms and an Olympic size pool. Among
other distinctions, the property was featured in Architectural Digest in 1996
and awarded the 1997 Heritage Award of Excellence by the Urban Land Institute.
In addition to the Arizona Biltmore Hotel, Florida Panthers Holdings,
Inc. owns the Boca Raton Resort & Club, the Registry Resort in Naples, the Hyatt
Regency Pier 66 Resort and Marina, the Radisson Bahia Mar Resort and Yachting
Center and the Rolling Hills Golf Club. The Company also owns the Florida
Panthers Hockey Club, the Arena Development and Arena Operating Companies, the
Incredible Ice Skating Rinks and an interest in the operations of the Miami
Arena.
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