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 31, 1998
--------------
LOCKHART CARIBBEAN CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
U.S. Virgin Islands
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(State or Other Jurisdiction of Incorporation or Organization)
333-35105 65-0491618
-------------------- ----------------------
(Commission File (I.R.S. Employer
Number) Identification Number)
No. 44 Estate Thomas
St. Thomas,
U.S. Virgin Islands 00802
-------------------- ----------------------
(Address of Principal (Zip Code)
Executive Officers)
Registrant's telephone number, including area code (340) 776-1900
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<PAGE>
Item 2. Acquisition or Disposition of Assets.
On March 31, 1998, Lockhart Caribbean Corporation (the "Company")
completed the sale of 3.684 acres of land (the "Parcel") to Fortress Self
Storage, Inc. ("Fortress"). Fortress paid the Company $2.8 million, subject to
certain adjustments, for this Parcel.
The Parcel is located in the Company's Sugar Estate Park development on
the island of St. Thomas. Fortress operates a self-storage facility on the
Parcel, and prior to the consummation of this transaction, Fortress ground
leased the Parcel from the Company.
On April 1 and April 7, 1998, the Company issued press releases
regarding the sale of the Parcel. A copy of the Company's press releases have
been filed as Exhibits 99.1 and 99.2 to this report.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
Not required.
(b) Pro forma financial information.
Pro forma financial statements reflecting the disposition of
the Parcel are included in this report beginning on page F-1.
(c) Exhibits.
10.1 Purchase and Sale Agreement, dated as of
January 8, 1998, between Sugar Estate Park, Inc.
and Fortress Self Storage, Inc.
99.1 April 1 Press Release
99.2 April 7 Press Release
<PAGE>
SIGNATURES
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.
Dated: April 14, 1998 LOCKHART CARIBBEAN CORPORATION
By: /s/ John P. deJongh, Jr.
--------------------------------
John P. deJongh, Jr.
President and Chief Operating
Officer
<PAGE>
INDEX TO PRO FORMA FINANCIAL STATEMENTS
UNAUDITED
Pro Forma Condensed Financial Statements--
Disposition of Assets ........................................... F-2
Pro Forma Condensed Balance Sheet as of
December 31, 1997 ............................................... F-3
Notes to Pro Forma Condensed Balance Sheet ............................... F-4
Pro Forma Condensed Statement of Operations
for the Year Ended December 31, 1997 ............................ F-5
Notes to Pro Forma Condensed Statement
of Operations ................................................... F-6
Non-recurring Charges or Credits ......................................... F-7
F-1
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED FINANCIAL STATEMENTS
DISPOSITION OF ASSETS
(Unaudited)
The following unaudited pro forma condensed financial statements of Lockhart
Caribbean Corporation (the "Company") reflect the following transactions: (i)
the sale of a portion of the Company's Sugar Estate Park development (3.684
acres of land) to the land lessee, Fortress Self Storage, Inc., for $2.8
million, and (ii) repayment of all outstanding debt on the Sugar Estate business
park with a portion of the proceeds from the sale. The unaudited pro forma
balance sheet as of December 31, 1997 shows the effects of these transactions as
if they had occurred at the date of the balance sheet. The unaudited condensed
statement of operations for the year ended December 31, 1997 shows the effects
of these transactions as if they had occurred on January 1, 1997.
Only items with a continuing impact and of a nonrecurring nature are presented
as adjustments in the preparation of the pro forma statement of operations.
However, there are certain nonrecurring items resulting directly from the
transactions that are material and, therefore, separately disclosed. These
nonrecurring items are presented as adjustments on the pro forma balance sheet.
The pro forma condensed financial statements were prepared by the management of
the Company. These pro forma condensed financial statements may not be
indicative of the results that actually would have occurred if the transactions
had been effected on the dates indicated or which may be obtained in the future.
F-2
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
Pro Forma Condensed Balance Sheet (Unaudited)
As of December 31, 1997
<TABLE>
<CAPTION>
Historical Adjustments Pro Forma
--------------------------------------------------------------
<S> <C> <C> <C>
Assets
Operating property, net of
accumulated depreciation $32,881,963 $ (350,841)(1) $32,531,122
Cash and cash equivalents 376,930 2,077,642 (2) 2,454,572
Accounts and note receivable 771,992 (30,365)(3) 741,627
Prepaid expenses 353,975 353,975
Other assets 1,318,720 1,318,720
--------------------------------------------------------------
Total assets $35,703,580 $1,696,436 $37,400,016
==============================================================
Liabilities and Stockholders' Equity
Liabilities:
Notes payable $25,953,806 $ (737,723)(4) $ 5,216,083
Property taxes 844,460 844,460
Tenant security deposits 388,902 (15,000)(5) 373,902
Deferred income taxes 723,692 918,435 (6) 1,642,127
Accounts payable and other
accrued expenses 927,498 927,498
--------------------------------------------------------------
Total liabilities 28,838,358 165,712 29,004,070
Stockholders' Equity:
Preferred stock, par value $0.01:
Authorized shares 1,000,000,
none issued
Class A common stock, par
value $0.01:
Authorized shares 40,000,000,
Issued and outstanding 6,560 656 656
Class B common stock, par
value $0.01:
Authorized shares 9,000,000,
Issued and outstanding 8,663,867 86,639 86,639
Additional paid-in capital 6,776,404 6,776,404
Retained earnings 1,523 1,530,724 (7) 1,532,247
--------------------------------------------------------------
Total stockholders equity 6,865,222 1,530,724 8,395,946
--------------------------------------------------------------
Total Liabilities and stockholders' equity $35,703,580 $1,696,436 $37,400,016
==============================================================
</TABLE>
F-3
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
Notes to Pro Forma Condensed Balance Sheet
(Unaudited)
For purposes of determining the effect of the transactions on the Company's
Condensed Balance Sheet as of December 31, 1997, the following pro forma
adjustments have been made.
As of
December 31, 1997
-----------------
(1) Book value of disposed
property $ (350,841)
(2) Net cash proceeds from sale of
property ($2,800,000 plus
receivable of $30,365, and less
tenant security deposit of $15,000
and debt retirement of $737,723) 2,077,642
(3) Settlement of accounts receivable
from buyer (30,365)
(4) Debt retirement from proceeds
of sale of property (737,723)
(5) Return of security deposit to
buyer (15,000)
(6) Tax impact of nonrecurring gain
on sale of property 918,435
(7) Nonrecurring gain on sale of
property ($2,800,000 less book
value of $350,841 and income 1,530,724
taxes at 37.5%)
F-4
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
Pro Forma Condensed Statement of Operations (Unaudited)
For the Year Ended December 31, 1997
<TABLE>
<CAPTION>
Historical Adjustments Pro Forma
--------------------------------------------------------------------
Revenues:
<S> <C> <C> <C>
Rental $4,465,945 ($242,414)(1) $4,223,531
Tenant reimbursements 476,769 (26,684)(1) 450,085
Other operating income 220,065 220,065
-------------------------------------------------------------------
Total revenue 5,162,779 (269,098) 4,893,681
Depreciation & amortization 1,447,484 (10,700)(2) 1,436,784
Other operating expenses 3,288,687 (24,198)(3) 3,264,489
-------------------------------------------------------------------
Total operating expenses 4,736,171 (34,898) 4,701,273
Operating income 426,608 (234,200) 192,408
Interest expense (2,248,943) 77,835 (4) (2,171,108)
Other income & expense (121,582) (121,582)
-------------------------------------------------------------------
Income (loss) before taxes (1,943,917) (156,365) (2,100,282)
Income taxes (benefit) (699,652) (58,637)(5) (758,289)
-------------------------------------------------------------------
Net income (loss) $(1,244,265) $ (97,728) $(1,341,993)
====================================================================
</TABLE>
F-5
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
Notes to Pro Forma Condensed Statement of Operations
(Unaudited)
For purposes of determining the effect of the transactions on the Company's
Condensed Statement of Operations for the year ended December 31, 1997, the
following pro forma adjustments have been made.
Year Ended
December 31, 1997
-----------------
(1) Loss of revenue from the property
sold:
Rental $(242,414)
Tenant reimbursements (26,684)
(2) Depreciation on land improve-
ments allocated to disposed
property (10,700)
(3) Property taxes and other general
maintenance expenses on
disposed property (24,198)
(4) Interest expense reduction from
repayment of debt on Sugar
Estate Park development out
of proceeds of land sale 77,835
(5) Income tax benefit on cummulative
effect of adjustments (37.5%) (58,637)
F-6
<PAGE>
LOCKHART CARIBBEAN CORPORATION AND SUBSIDIARIES
Non-recurring Charges or Credits
Sale price of operating property $2,800,000
Book value of operating property sold 350,841
----------
Gain on sale of operating property 2,449,159
Income taxes - 37.5% (1) 918,435
----------
Income from sale of operating property $1,530,724
==========
Notes:
- ------------
(1) With a tax loss carryforward of approximately $3.4 million as of December
31, 1997, the income tax provision is charged against deferred taxes rather
than income tax payable and is, therefore, not a payable to the government.
F-7
<PAGE>
LOCKHART CARIBBEAN CORPORATION
Index to Exhibits to Form 8-K dated March 31, 1998
Exhibit Description
- ------- -----------
10.1 Purchase and Sale Agreement, dated as of January 8, 1998, between
Sugar Estate Park, Inc. and Fortress Self Storage, Inc.
99.1 April 1 Press Release
99.2 April 7 Press Release
Exhibit 10.1
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (the "Agreement") dated as of January
8, 1998, is made and entered into by and between SUGAR ESTATE PARK, INC., a U.S.
Virgin Islands corporation ("Seller") and FORTRESS SELF STORAGE, INC., a U.S.
Virgin Islands corporation, ("Buyer").
W I T N E S S E T H:
WHEREAS, by Ground Lease dated November 15, 1990 between Lockhart
Realty Company and Buyer, as amended by First Amendment to Ground Lease, dated
August 9, 1991, between Lockhart Realty Company Limited Partnership, as
successor-in-interest to Lockhart Realty Company and Buyer, as further
supplemented by a License Agreement dated July 9, 1992 between Lockhart Realty
Company Limited Partnership and Buyer, Buyer is the Lessee of the property set
forth in Exhibit A attached hereto (the "Land"); and
WHEREAS, Seller is the successor-in-interest to Lockhart Realty Company
Limited Partnership; and
WHEREAS, Seller is desirous of selling and conveying the Land together
with all tenements, hereditaments, rights, privileges and easement thereunto
belonging, collective referred to herein as the "Subject Property" and Buyer is
desirous of purchasing the Subject Property from Seller;
NOW, THEREFORE, for and in consideration of the premises hereof, the
sums of money to be paid hereunder, the mutual covenants herein contained, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. Agreement to Sell and Purchase. Seller hereby agrees to sell and
convey and Buyer hereby agrees to purchase and accept the Subject Property upon
the terms and subject to the conditions set forth in this Agreement.
2. Purchase Price and Method of Payment. The amount of $2,800,000.00
shall be the total purchase price ("Purchase Price"), subject to credits,
adjustments and prorations for which provisions are hereinafter made. The
Purchase Price shall be paid to Seller by Buyer at Closing by certified or bank
check or wire transfer.
Buyer's obligations under this Agreement are subject to and contingent
upon Buyer's being able to obtain a commitment for a mortgage loan satisfactory
to Buyer on the property. The Buyer agrees to use diligent efforts to obtain a
commitment for a satisfactory mortgage loan.
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<PAGE>
3. Closing. The Closing shall take place in St. Thomas, Virgin Islands
on or about March 31, 1998. If the Closing does not take place on or before
March 31, 1998, TIME BEING OF THE ESSENCE OF THIS DATE, or on such later date as
the Parties hereto agree in writing, then the Seller may terminate this
Agreement and the parties shall have no further obligations one to the other as
a result of this Agreement and each party shall bear its own costs. At Closing,
the Seller shall convey insurable title to the Subject Property to the Buyer by
Warranty Deed in substantially the form attached hereto as Exhibit B, said title
to be free of all liens and encumbrances except those referred to in the
Warranty Deed attached hereto as Exhibit B.
4. Closing Costs. Buyer shall pay any document preparation fees for any
documents to be delivered by Buyer. Seller shall pay for preparation of the Deed
and other transfer documents and obtaining the required attest on the Deed.
Buyer shall pay the cost of recording the Deed (inclusive of the documentary
stamp taxes, transfer taxes and the like relating solely to the conveyance of
the Subject Property to the Buyer. Buyer and Seller shall bear the cost of their
respective attorneys' fees).
5. Condemnation Prior to Closing. In the event that any condemnation
proceedings are initiated prior to Closing and either (i) the entire Subject
Property is to be taken or (ii) Seller determines that the diminution in value
of, or cost to repair any damage to, the Subject Property resulting from a
partial condemnation shall exceed $50,000, then either Buyer or Seller shall
have the right to terminate this Agreement, and upon such termination, both
parties shall be relieved of all obligations and liabilities hereunder and
Seller shall be entitled to receive any award made by the condemning authority
in connection with such condemnation proceedings. If neither Buyer nor Seller
elects to terminate this Agreement as provided in the preceding sentence, or if
Seller determines that the diminution in value or cost to repair any damage
resulting from a partial condemnation shall not exceed $50,000, then Buyer shall
pay the full Purchase Price for the Subject Property without reduction at
Closing and Seller shall assign to Buyer at Closing all of Seller's right, title
and interest in and to any award made by the condemning authority in connection
with such condemnation proceedings.
6. Prorations.
(A) Taxes and Rents. Real Estate taxes and rents shall be
prorated as of the date of Closing. All prorations under this Subparagraph 6.(A)
shall be final. Prorations shall be calculated based upon the most recent tax
bill assessment and the terms and conditions of the Ground Lease between Seller
(or its predecessor-in-interest) and Buyer.
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<PAGE>
(B) Assessments. Buyer shall pay all common area charges, if
any, assessed by the Seller as Lessor of the Subject Property, prorated to the
date of Closing.
(C) Tax Reduction Proceedings. Seller shall have the right to
prosecute and continue to prosecute subsequent to the Closing any tax certiorari
proceedings for the tax year in which the Closing occurs and all prior tax
years. Any refunds obtained for any tax years prior to the tax year in which the
Closing occurs, net of the expenses incurred in obtaining such refunds, shall be
paid to Seller. Any refund obtained for the tax year in which the Closing
occurs, net of the expenses incurred in obtaining such refunds, shall be
apportioned to the Closing Date, with any portion thereof allocable to periods
subsequent to the Closing Date to be paid to Buyer and the remainder to be paid
to Seller. Notwithstanding the preceding sentences, any refund for any time
period prior to the Closing, which is attributable to land and not improvements
and a portion of which has been previously paid by Buyer under the terms of its
Lease, shall be prorated as to the portion paid by Buyer using the formula set
forth in the Lease and paid to Buyer. The provisions of this Section 6(C) shall
survive the Closing.
7. Representations and Warranties of Seller.
(A) Seller represents and warrants to Buyer that Seller has
and at the time of Closing will have full power and legal right and authority to
enter into and perform its obligations under this Agreement and the consummation
of the sale and purchase transaction contemplated herein will not result in the
breach of or constitute a default under any agreement or instrument to which
Seller is bound in such manner as to affect Seller's ability to sell and convey
the Subject Property as contemplated herein.
(B) Notwithstanding anything to the contrary set forth in this
Agreement, Buyer is acquiring the Subject Property "AS IS", "WHERE IS", WITH ALL
FAULTS AND DEFECTS. Buyer acknowledges and agrees that Seller (or any agent of
Seller) has not made and does not make, and Seller specifically disclaims, any
representations, warranties, promises, covenants, agreements or guaranties of
any kind or character whatsoever, whether express or implied, oral or written,
past, present or future, of, as to, concerning or with respect to:
I. The nature, quality or condition of the Subject Property,
including without limitation, the water, soil and geology of, or
the presence or absence of any pollutant, hazardous waste, gas or
substance or solid waste on or about, or deriving from the
Subject Property;
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<PAGE>
II. Any income to be derived from the Subject Property;
III. The suitability of the Subject Property for any and all
activities and uses which Buyer may intend to conduct thereon;
IV. The compliance of or by the Subject Property or its
operations with any laws, rules, ordinances or regulations of any
governmental authority or body having jurisdiction over the
Subject Property; provided, however, Seller represents that it
has received no notice of violation of any of the foregoing laws,
rules, ordinances or regulations, except as disclosed to Buyer;
and
V. The habitability, merchantability or fitness for a
particular purpose of the subject property.
(C) Buyer acknowledges that the Buyer is relying solely on its
own investigation of the Subject Property and not on any information provided or
to be provided by Seller. Buyer further acknowledges that no independent
investigation or verification has been or will be made by Seller with respect to
any information supplied by Seller concerning the Subject Property and that
Seller makes no representation as to the accuracy or completeness of such
information.
(D) Except with respect to a breach of any representation or
warranty made by Seller herein, without limiting the above, Buyer (and any
assignee of Buyer's rights hereunder) waives its rights to recover from, and
forever releases and discharges, Seller, Seller's affiliates, the partners,
trustees, shareholders, directors, officers, attorneys, employees and agents of
each of them, and their respective heirs, successors, personal representatives
and assigns, from any and all demands, claims, legal or administrative
proceedings, losses, liabilities, damages, penalties, fines, liens, judgments,
costs or expenses whatsoever (including, without limitation, attorneys' fees and
costs) whether direct or indirect, known or unknown, foreseen or unforeseen,
that may arise on account of or in any way be connected with the Subject
Property ("Claims"), including, without limitation, the physical, environmental
and structural condition of the Subject Property or any law or regulations
applicable thereto (including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended (42
U.S.C. Sections 6901, et seq.), the Resources Conservation and Recovery Act of
1976 (42 U.S.C. Section 6901, et seq.), the Clean Water Act (33 U.S.C. Section
1251 et seq.), the Safe Drinking Water Act (14 U.S.C. Section 1401, et seq.),
the Hazardous Materials Transportation Act (49 U.S.C. Section 1401 et. Seq.),
and the Toxic Substance Control Act (15 U.S.C. Section 2601, et seq.).
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<PAGE>
(E) Buyer bears the risk of any costs or expenses suffered or
incurred by Buyer with regard to any lack of information, incorrect information
or inadequate information relating to any of the matters described above.
(F) The provisions of Subparagraphs 12(B), 12(C), 12(D), and
12(E) shall survive the Closing, but shall not survive the termination of this
Purchase and Sale Agreement for any reason other than a closing.
8. Representations and Warranties of Buyer. Buyer represents and
warrants to Seller that Buyer has and at the time of Closing will have full
power and legal right and authority to enter into and perform its obligations
under this Agreement and the consummation of the sale and purchase transaction
contemplated herein will not result in the breach of or constitute a default
under any agreement or instrument to which Buyer is bound in such manner as to
affect Buyer's ability to purchase the Subject Property as contemplated herein.
9. Closing Requirements.
(A) Seller agrees to the following closing requirements:
(i) Seller shall deliver the following closing documents at
Closing (unless the delivery thereof shall have been
waived by Buyer in writing):
(a) the Deed;
(b) Certificate of Non-Foreign Status, in the form
attached hereto as Exhibit C;
(c) if appropriate, resolutions of Seller, property
executed and approved in accordance with the
by-laws of Seller, authorizing the transactions
contemplated by this Agreement;
(d) such other documents, instruments and certificates
as may be reasonably required by the title company
to fully effect and consummate the transactions
contemplated hereby.
(B) Buyer agrees to the following closing requirements:
(i) At the time of Closing hereunder the representations
and warranties of the Buyer described in Paragraph 8
hereof shall be true and correct in all material
respects and
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<PAGE>
there shall have been no material breach or breaches of
the same by Buyer.
(ii) Buyer shall deliver the following items at Closing
(unless the delivery thereof shall have been waived by
Seller in writing):
(a) the Purchase Price plus or minus prorations and any
other amounts to be paid by Buyer to Seller
hereunder;
(b) if appropriate, resolutions of Buyer, property
executed and approved in accordance with the
by-laws of Buyer, authorizing the transactions
contemplated by this Agreement;
(c) such other documents, instruments and certificates
as may be reasonably required by the title company
to fully effect and consummate the transactions
contemplated hereby.
(C) Buyer and Seller shall jointly deliver three (3) copies of
a Closing Statement at Closing.
10. Survival of Provisions. The provisions of this Agreement shall not
survive the Closing or the termination of this Agreement hereunder except as
expressly provided elsewhere in this Agreement.
11. Notices. All notices, elections, consents, demands and
communications (collectively called "Notices" or individually called "Notice")
shall be in writing and delivered personally or by registered or certified mail,
return receipt requested, postage prepaid, or by a nationally recognized
overnight courier service and service and sent to the appropriate address on the
signature page of this Agreement. Copies of all Notices shall be sent to the
attorneys for the respective parties as follows in the same manner of delivery
as used for the parties:
Seller's Attorney: A. James Casner, III, Esq.
Dudley, Topper & Feuerzeig
P.O. Box 756
St. Thomas, VI 00804
Buyer's Attorney: Paul Hoffman, P.C.
P.O. Box 870
St. Thomas, VI 00804.
Either party may, by written notice to the other, change the address to which
Notices are to be sent. Unless otherwise
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<PAGE>
provided herein, all Notices shall be deemed given when actually received, in
the case of personal delivery or delivery by overnight courier, or when
deposited in any branch, station or depository maintained by the U.S. Postal
Service, if sent by registered or certified mail, except that a notice of change
of address shall be deemed given when actually received.
12. Governing Law and Binding Effect. This Agreement and the
interpretation and enforcement of the same shall be governed by and construed in
accordance with the laws of the United States Virgin Islands and shall be
binding upon, inure to the benefit of, and be enforceable by the parties hereto
as well as their respective successors and assigns, subject, however, to the
provisions of Paragraph 17 hereof.
13. Integrated Agreement, Waiver and Modification. This Agreement
represents the complete and entire understanding and agreement between the
parties hereto with regard to all matters involved in this transaction and
supersedes any and all prior or contemporaneous agreements, whether written or
oral, except the Lease. No agreements or provisions, unless incorporated herein,
shall be binding on either party hereto. This Agreement may not be modified or
amended nor may any covenant, agreement, condition, requirement, provision,
warranty or obligation contained herein be waived, except in writing signed by
both parties or, in the event that such modification, amendment or waiver is for
the benefit of one of the parties hereto and to the detriment of the other, then
the same must be in writing signed by the party to whose detriment the
modification, amendment or waiver inures. Waiver or performance or satisfaction
of timely performance or satisfaction of any condition, covenant, requirement,
obligation or warranty by one party shall not be deemed to be a waiver of the
performance or satisfaction of any other condition, covenant, requirement,
obligation or warranty unless specifically consented to in writing.
14. Brokerage - Agency Disclosure. Seller and Buyer hereby acknowledge
that no broker or finder has been employed by them in connection with the
execution of this Agreement or the consummation of the transaction contemplated
hereby. Each of Seller and Buyer warrants to the other that no commissions are
payable or due to any broker or finder in connection with this Agreement or the
transactions contemplated herein. Each of Seller and Buyer agrees to indemnify,
defend and hold the other harmless from and against any commissions or fees or
claims for commissions or fees asserted by any party with whom the indemnifying
party has dealt. The provisions of this Paragraph 15 shall survive the
termination of this Agreement or the Closing, whichever occurs.
15. No Recording. This Agreement shall not be recorded in the land
records of the jurisdiction where the Subject Property
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is located. If either party records this Agreement or any memorandum hereof
without the express written consent of the other party, which consent either
party may withhold in its sole discretion, this Agreement shall be deemed null
and void at the election of the non-recording party.
16. No Third Party Benefit. This Agreement is made for the sole benefit
of Buyer and Seller and no other person or persons shall have any benefits,
rights or remedies under or by reason of this Agreement.
17. No Assignment. Buyer shall not assign its rights under this
Agreement without the prior written consent of Seller, which Seller may withhold
in its sole discretion; provided, however, that Buyer shall have the right to
designate its majority controlled corporate entity as the title holder so long
as Buyer gives notice to Seller of the designated entity at least fifteen (15)
days prior to Closing. Any assignment shall not relieve the Buyer of any
liability under this Contract.
18. Waiver of Trial by Jury. THE SELLER AND THE BUYER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED HEREIN, OR ARISING OUT OF, UNDER OR
IN CONNECTION WITH THE AGREEMENT OR ANY OTHER DOCUMENT CONTEMPLATED TO BE
EXECUTED IN CONJUNCTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION
IS A MATERIAL INDUCEMENT FOR THE SELLER ENTERING INTO THIS AGREEMENT WITH THE
BUYER. FURTHER, THE BUYER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF
SELLER, NOR THE SELLER'S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
THE SELLER WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS
WAIVER OF RIGHT TO JURY TRIAL PROVISION. NO REPRESENTATIVE OR AGENT OF THE
SELLER, NOR SELLER'S COUNSEL HAS THE AUTHORITY TO WAIVE, CONDITION, OR MODIFY
THIS PROVISION.
THIS PARAGRAPH 18 SHALL SURVIVE THE CLOSING OR THE TERMINATION OF THIS
AGREEMENT, WHICHEVER OCCURS.
19. Counterparts. This Agreement and any document or instrument
executed pursuant hereto may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
20. Date of Performance. If any date for performance hereunder falls on
a Saturday, Sunday or other day which is a holiday under federal law or under
Territorial law where the Subject Property is located, the date for such
performance shall be the next succeeding business day.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in a manner and form sufficient to bind them as of the date first above
written.
SELLER:
SUGAR ESTATE PARK, INC.
P.O. Box 7020
St. Thomas, VI 00801
By: /s/ John P. deJongh, Jr.
--------------------------------------
John P. deJongh, Jr., President
Attest: /s/ Cornel A. Williams
----------------------------------
Cornel A. Williams,
Secretary
BUYER:
FORTRESS SELF STORAGE, INC.
P.O. Box 870
St. Thomas, VI 00804
By: /s/ Joel Tranum
--------------------------------------
Joel Tranum, President
Attest: /s/ Paul Hoffman
----------------------------------
Paul Hoffman, Secretary
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Exhibit 99.1
April 1, 1998
LOCKHART ANNOUNCES SALE OF PROPERTY TO
FORTRESS SELF STORAGE, INC.
(St. Thomas, USVI) Lockhart Caribbean Corporation ("LCC") today announced that
Fortress Self Storage, Inc. (FSS), a U.S. Virgin Islands corporation, has
purchased the property it formerly leased from LCC's subsidiary, Sugar Estate
Park, Inc. ("SEP"), and upon which it built its self storage facility in 1992.
The property purchased by FSS is approximately 3.6 acres, and is located in
Estate Thomas, St. Thomas, on the eastern edge of the U.S.V.I. capital,
Charlotte Amalie. It is situated within an 11.7 acre commercial business park
area developed by LCC in 1991.
"The principals of Fortress expressed a desire to purchase the property
last year, and the negotiations went very smoothly. Their purchase of the land
makes sense for them, and, for us, confirmed its commercial valuation." noted
John P. deJongh, Jr., President and Chief Operating Officer of both LCC and SEP.
He stated that the transfer of ownership will not affect any of the other ground
leases in the commercial park, and that there were protective measures in the
transaction to prohibit any sort of construction or business on the parcel that
would not be in harmony with the existing business atmosphere.
LCC has recently been in the news regarding its upcoming acquisition of
Al Cohens Plaza on Raphune Hill, St. Thomas, as well as LCC's Market Square East
development involving long-term ground leases to Cost-U-Less, Inc (Bellvue,
Washington) and Caribbean Cinemas Corporation (San Juan, Puerto Rico). LCC's
Lockhart Garden Shopping Center is also under renovation for a new Kmart store,
and Lockhart's Mini-Mall, due to open this spring.
* * *
Lockhart Caribbean Corporation, headquartered on St. Thomas, is the
largest owner of shopping centers in the U.S. Virgin Islands, and is one of the
largest owners of undeveloped land on St. Thomas, variously zoned for commercial
and residential development. The company owns, operates, and develops shopping
centers and other commercial real estate, primarily on the islands of St. Thomas
and St. Croix. Lockhart currently owns and operates seven shopping centers and
one commercial park, and has seven additional projects in various stages of
development. Lockhart has entered into a definitive agreement to purchase and
acquire all the outstanding common stock of Premium Finance
- 1 -
<PAGE>
Company of the Virgin Islands, Inc. and its wholly-owned subsidiary, Premium
Finance (E.C.), Ltd. These companies are in the business of financing insurance
premiums for individuals and businesses in the U.S. Virgin Islands, British
Virgin Islands, Anguilla, St. Maarten, Antigua, St. Vincent and Grenada.
Inquiries can be made directly to Lockhart's President, John P.
deJongh, Jr., at the Lockhart Caribbean Corporation's offices, telephone no.
340-776-1900, facsimile no. 340-776-1940, email [email protected], website
http://www.lockhart.com.
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Exhibit 99.2
April 7, 1998 FOR IMMEDIATE RELEASE:
John P. deJongh, Jr.
340-776-1900
[email protected]
http://www.lockhart.com
Lockhart Announces Sale Of 3.6 Acre St. Thomas Property
To Fortress Self Storage, Inc. For $2.8 Million
(St. Thomas, USVI) Lockhart Caribbean Corporation ("Lockhart") today
announced the purchase by Fortress Self Storage, Inc. of the property it
formerly leased from Sugar Estate Park, Inc., a wholly-owned subsidiary of
Lockhart Realty, Inc. ("Lockhart Realty"), and upon which it built its
self-storage facility in 1992. Lockhart Realty is the operating subsidiary of
Lockhart Caribbean that owns 415 acres of undeveloped real estate and operates
the commercial parks.
The 3.6 acre property was purchased by Fortress for $2.8 million and is
located on the eastern edge of the USVI. capital, Charlotte Amalie. The parcel
is situated within an 11.7 acre commercial business park area developed by
Lockhart in 1991.
"The principals of Fortress expressed a desire to purchase the property
last year and the negotiations went very smoothly. For our part, the purchase
confirmed the property's value and will allow the company to put this new
capital to work in several new projects we are undertaking," noted John P. de
Jongh, Jr., Lockhart's President and Chief Operating Officer. "The sales price
is 500% above the carrying book value and represents a 20% premium above the
valuation established in Lockhart's most recent certified appraisal."
Mr. deJongh stated that the transfer of ownership will not affect any
of the other ground leases in the commercial park, and that there were
protective measures in place to ensure the parcel's future use will be in
harmony with the existing business atmosphere.
1998 has already been a busy year for Lockhart, which had previously
announced its upcoming acquisition of Al Cohen's Plaza on Raphune Hill, St.
Thomas and the progress of Lockhart's Market Square East development highlighted
by the signing of long-term ground leases to Cost-U-Less, Inc. (Bellevue,
Washington) and Caribbean Cinemas Corporation (San Juan, Puerto Rico). The
company's Lockhart Garden Shopping Center is also under renovation for a new
Kmart store, and Lockhart's Mini-Mall is scheduled to open this spring.
* * *
- 1 -
<PAGE>
Lockhart Caribbean Corporation, headquartered on St. Thomas, is the
largest owner of shopping centers in the U.S. Virgin Islands, and is one of the
largest owners of undeveloped land on St. Thomas, variously zoned for commercial
and residential development. The company owns, operates, and develops shopping
centers and other commercial real estate, primarily on the islands of St. Thomas
and St. Croix. Lockhart currently owns and operates seven shopping centers and
one commercial park, and has seven additional projects in various stages of
development. Lockhart has entered into a definitive agreement to purchase and
acquire all the outstanding common stock of Premium Finance Company of the
Virgin Islands, Inc. and its wholly-owned subsidiary, Premium Finance (E.C.),
Ltd. These companies are in the business of financing insurance premiums for
individuals and businesses in the U.S. Virgin Islands, British Virgin Islands,
Anguilla, St. Maarten, Antigua, St. Vincent and Grenada.
Inquiries can be made directly to Lockhart's President, John P.
deJongh, Jr., at the Lockhart Caribbean Corporation's offices, telephone no.
340-776-1900, facsimile no. 340-776-1940, email [email protected], website
http://www.lockhart.com.
- 2 -
