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As filed with the Securities and Exchange Commission on March 30, 1999
Exhibit Index on Page 9
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 12, 1999
Commission File Number: 001-14525
VORNADO OPERATING COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 22-3569068
(State or other jurisdiction of incorporation) (I.R.S. employer
identification number)
PARK 80 WEST, PLAZA II, SADDLE BROOK, NEW JERSEY 07663
(Address of principal executive offices) (Zip Code)
(201) 587-1000
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
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ITEM 1. NOT APPLICABLE.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Vornado Operating Company and Crescent Operating Inc. form new
partnership and acquire AmeriCold Logistics
On March 12, 1999, Vornado Operating Company (together with its consolidated
subsidiaries, the "Company") and Crescent Operating Inc. ("Crescent Operating")
formed a new partnership that has purchased all of the non-real estate assets of
AmeriCold Logistics encompassing the operations of the cold storage business for
approximately $48 million from a partnership owned by Vornado Realty Trust
(together with its consolidated subsidiaries and preferred stock affiliates,
"Vornado") and Crescent Real Estate Equities Company ("Crescent Real Estate").
The Company owns 60% of the new partnership and Crescent Operating owns 40% of
the new partnership. The new partnership leases 88 cold storage warehouses used
in this business from the partnership of Vornado and Crescent Real Estate, which
continues to own the real estate. In addition, the new partnership manages 13
additional warehouses containing approximately 80 million cubic feet of space.
To fund its share of the purchase price, the Company utilized $4.6 million of
cash and borrowed $18.6 million under its revolving credit facility with
Vornado. Further, the Company will pay $6 million to close the warehousing
operation of one of the leased facilities. The purchase price of the cold
storage operating assets was proposed by the partnership of Vornado and Crescent
Real Estate (the sellers). The Board of Directors of both the Company and
Crescent Operating reviewed and approved the transaction after concluding that
the price was fair market value at the time of the transaction.
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AmeriCold Logistics
The acquired business has 5,500 employees and operates 101 warehouse
facilities nationwide with an aggregate of approximately 530 million cubic feet
of refrigerated, frozen and dry storage space under the name "AmeriCold
Logistics." AmeriCold Logistics has its headquarters in Atlanta, Georgia.
AmeriCold Logistics provides the frozen food industry with refrigerated
warehousing and transportation management services. Refrigerated warehouses are
comprised of production and distribution facilities. Production facilities
typically serve one or a small number of customers, generally food processors,
located nearby. These customers store large quantities of processed or partially
processed products in the facility until they are shipped to the next stage of
production or distribution. Distribution facilities primarily warehouse a wide
variety of customers' finished products until future shipment to end-users. Each
distribution facility primarily services the surrounding regional market.
AmeriCold Logistics offers transportation management services including freight
routing, dispatching, freight rate negotiation, backhaul coordination, freight
bill auditing, network flow management, order consolidation and distribution
channel assessment. AmeriCold Logistics' temperature-controlled logistics
expertise and access to both frozen food warehouses and distribution channels
enable its customers to respond quickly and efficiently to time-sensitive orders
from distributors and retailers.
AmeriCold Logistics' customers consist primarily of national, regional
and local frozen food manufacturers, distributors, retailers and food service
organizations including Con-Agra, Inc., Tyson Foods, H.J. Heinz & Co., McCain
Foods, Pillsbury, Sara Lee, Philip Morris, J.R. Simplot, Farmland Industries and
Unilever.
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Leases for the cold storage warehouse properties
AmeriCold Logistics entered into six leases covering the warehouses
used in this business. The leases have a 15-year term with two-five year
renewal options and provide for the payment of fixed base rent and percentage
rent based on revenues AmeriCold Logistics receives from its customers. Fixed
rent is approximately $123 million per annum through 2003, $126 million per
annum from 2004 through 2008 and $130 million per annum from 2009 through 2014.
Percentage rent for each lease is based on a specified percentage of revenues
in excess of a specified base amount. The aggregate base revenue amount under
five of the six leases is approximately $321 million, and the weighted average
percentage rate is 36.5% for the initial five-year period, 39.1% for the period
from 2004 through 2008 and 40.7% for the period from 2009 through February 28,
2014. The aggregate base revenue amount under the sixth lease is approximately
$32 million, and the percentage rate is 24% for the initial two-year period,
37.5% for the period from 2002 through 2006, 40% from 2007 through 2011 and 41%
from 2012 through February 28, 2014. Fixed base rent and percentage rent for
the initial year are projected to be approximately $151,000,000.
AmeriCold Logistics has the right to defer the payment of 15% of fixed
rent and all percentage rent for up to three years beginning on March 12,
1999 to the extent that available cash, as defined in the leases, is
insufficient to pay such rent.
The fixed rent for each of the two five-year renewal options is equal
to the greater of the then fair market value rent and the fixed rent for the
immediately preceding lease year plus 5%.
AmeriCold Logistics is required to pay all costs arising from the
operation, maintenance and repair of the properties, including
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all real estate taxes and assessments, utility charges, permit fees and
insurance premiums, as well as property capital expenditures in excess of
$5,000,000 annually.
Terms of the new partnership
Vornado is the day-to-day liaison to the management of AmeriCold
Logistics. The new partnership will pay Vornado an annual fee of $487,000, which
is based on the cold storage operating assets acquired by the new partnership on
March 12, 1999. The fee increases by an amount equal to 1% of the cost of new
acquisitions including transaction costs. The new partnership will provide
financial statement preparation, tax and similar services to the
Vornado/Crescent real estate partnership (the lessor of the cold storage
warehouse properties) for an annual fee of $250,000 increasing 2% each year.
The Company must obtain Crescent Operating's approval for specified
matters involving AmeriCold Logistics, including approval of the annual budget,
requiring specified capital contributions, entering into specified new leases or
amending existing leases, selling or acquiring specified assets and any sale,
liquidation or merger of AmeriCold Logistics. If the partners fail to reach an
agreement on certain matters prior to October 30, 2000, the Company will be
entitled to buy Crescent Operating's interest in the partnership at cost plus a
10% per annum return. If the partners fail to reach agreement on such matters
during the period from November 1, 2000 through October 30, 2007, the Company
may set a price at which it commits to either buy Crescent Operating's
investment, or sell its own, and Crescent Operating will decide whether to buy
or sell at that price. If the partners fail to reach agreement on such matters
after October 30, 2007, either party may set a price at which it commits to
either buy the other party's investment, or sell its own, and the other party
will decide whether to buy or sell at that price.
Neither partner may transfer its rights or interest in the partnership
without the consent of the other partner. The partnership will continue for a
term through October 30, 2027, except as the partners may otherwise agree.
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Certain Relationships with Vornado
The Company and Vornado are parties to an intercompany agreement
described in a Prospectus, dated October 14, 1998, which forms part of the
Company's Registration Statement on Form S-11 filed with the Securities and
Exchange Commission. Steven Roth, the Chairman of the Board of Directors and
Chief Executive Officer of the Company, Michael D. Fascitelli, a Director and
the President of the Company, Richard West, a Director of the Company, and
Russell B. Wight, Jr., a Director of the Company, are also Trustees of Vornado.
Mr. Roth is also the Chairman of the Board of Trustees and Chief Executive
Officer of Vornado, Mr. Fascitelli is also the President of Vornado, and
certain other members of the Company's senior management hold corresponding
positions with Vornado.
ITEMS 3 THROUGH 6. NOT APPLICABLE.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
The financial information required by this item will be filed not later
than 60 days after the date that this report is filed.
The following exhibits are furnished in accordance with the provisions
of Item 601 of Regulation S-K:
Exhibit No. Description
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2.1* Asset Purchase Agreement, dated as of February 26, 1999,
between AmeriCold Logistics, LLC, as Purchaser, and AmeriCold
Corporation, as Seller.
2.2* Asset Purchase Agreement, dated as of March 9, 1999, between
Vornado Crescent Logistics Operating Partnership, as
Purchaser, and URS Logistics, Inc., as Seller.
2.3* Asset Purchase Agreement, dated as of March 9, 1999, between
AmeriCold Logistics, LLC, as Purchase, and VC Omaha Holdings,
L.L.C., as Seller.
2.4* Asset Purchase Agreement, dated as of March 9, 1999, between
AmeriCold Logistics II, LLC, as Purchaser, and VC Missouri
Holdings, L.L.C., as Seller.
10.1 Agreement, dated March 11, 1999, between Vornado Operating
L.P. and COPI Cold Storage L.L.C.
99.1** Financial information.
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99.2 Press release of Vornado Operating Company, dated March 17, 1999.
* Pursuant to Item 601(b)(2) of Regulation S-K, the schedules and
exhibits to the documents that are filed as Exhibits 2.1 through 2.4 to
this report are not filed with this report but are identified in each
such Exhibit and will be furnished supplementally to the Securities and
Exchange Commission upon request.
** To be filed by amendment.
ITEM 8. NOT APPLICABLE.
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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.
VORNADO OPERATING COMPANY
(Registrant)
By: /s/ Irwin Goldberg
---------------------------
Name: Irwin Goldberg
Title: Vice President --
Chief Financial Officer
Date: March 30, 1999
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Index to Exhibits
Exhibit No. Description
- ----------- -----------
2.1* Asset Purchase Agreement, dated as of February 26, 1999,
between AmeriCold Logistics, LLC, as Purchaser, and AmeriCold
Corporation, as Seller.
2.2* Asset Purchase Agreement, dated as of March 9, 1999, between
Vornado Crescent Logistics Operating Partnership, as
Purchaser, and URS Logistics, Inc., as Seller.
2.3* Asset Purchase Agreement, dated as of March 9, 1999, between
AmeriCold Logistics, LLC, as Purchase, and VC Omaha Holdings,
L.L.C., as Seller.
2.4* Asset Purchase Agreement, dated as of March 9, 1999, between
AmeriCold Logistics II, LLC, as Purchaser, and VC Missouri
Holdings, L.L.C., as Seller.
10.1 Agreement, dated March 11, 1999, between Vornado Operating
L.P. and COPI Cold Storage L.L.C.
99.1** Financial information.
99.2 Press release of Vornado Operating Company, dated March 17,
1999.
* Pursuant to Item 601(b)(2) of Regulation S-K, the schedules and
exhibits to the documents that are filed as Exhibits 2.1 through
2.4 to this report are not filed with this report but are
identified in each such Exhibit and will be furnished
supplementally to the Securities and Exchange Commission upon
request.
** To be filed by amendment.
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Exhibit 2.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made as of the 26th day
of February, 1999, by and between AMERICOLD LOGISTICS, LLC, a Delaware limited
liability company ("Purchaser"), and AMERICOLD CORPORATION, an Oregon
corporation ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business of providing refrigerated, frozen and
dry warehouse storage services, logistics, distribution and transportation
services and other services and limited mining operations (collectively, the
"Business"); and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, substantially all of the assets of Seller used or held for
use in the Business except for the Excluded Assets (as hereinafter defined)
pursuant to the terms of this Agreement; and
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the transactions contemplated herein and certain additional
agreements related thereto.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF PURCHASED ASSETS
1.1 Assets to be Acquired. Subject to and upon the terms and conditions
set forth herein, Purchaser hereby agrees to purchase from Seller, and Seller
hereby agrees to sell, transfer and assign to Purchaser all of the tangible and
intangible assets of Seller (but excluding the Excluded Assets) used or held for
use in connection with the Business, including, without limitation, the
following (collectively, the "Purchased Assets"):
(a) all of Seller's vehicles and equipment (excluding refrigeration
equipment which is part of the real estate) used or held for use by Seller in
connection with the Business as of the Closing (as hereinafter defined),
including, but not limited to, tools, fork lifts, racks, supplies, computers and
computer equipment, furniture and fixtures and those items listed on Schedule
1.1(a) attached hereto (the "Fixed Assets"); and
(b) all of Seller's right, title and interest in, to and under all
written or oral contracts, license agreements and all other agreements,
commitments and other instruments to which the Purchased Assets are subject or
bound or that otherwise pertain to the Business including without limitation the
agreements set forth in Schedule 1.1(b) attached hereto (collectively, the
"Contracts"); and
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(c) all of Seller's interest in, and rights and benefits accruing to
Seller under, those certain leases to which Seller is a party and which pertain
to the Business as identified on Schedule 1.1(c) attached hereto (collectively,
the "Assumed Leases"); and
(d) all of Seller's interest in and to the issued and outstanding
shares of Americold Services Corporation, a Delaware corporation; all of
Seller's membership interest in and to KC Underground, L.L.C., a Delaware
limited liability company ("KC Underground"); all of Seller's membership
interest in and to Inland Quarries, L.L.C., a Delaware limited liability company
("Inland Quarries"); and all of Seller's membership interest in and to
Americold/Offutt, L.L.C., an Oregon limited liability company
("Americold/Offutt"); and
(e) all rights and interests of Seller in any trademarks, service
marks, copyrights, logos, patents, inventions, processes, franchises,
registrations, license agreements, trade secrets, customer lists, trade lists
and trade or service names used in the Business, including without limitation
those marks and names listed on Schedule 1.1(e) attached hereto (collectively,
the "Intellectual Property"); and
(f) all of Seller's licenses, consents, permits, variances,
certifications and approvals of governmental agencies used or held for use in
connection with the Business, to the extent assignable; and
(g) all of Seller's right, title and interest in and to its
telephone numbers and the directory advertising for such telephone numbers for
each of its facilities and offices, to the extent assignable; and
(h) all of Seller's right, title and interest in and to its books
and records related to the Business and the Purchased Assets; and
(i) all of Seller's right, title and interest in and to its computer
software and licenses therefor and any proprietary technology and processes; and
(j) all of Seller's right, title and interest in and to any voting
securities of any corporation or other entity other than the securities held for
investment and listed on Schedule 1.1(j); and
(k) all of Seller's right, title and interest in and to all of the
cash, accounts receivable, other rights to receive payment from customers of the
Business and all other current assets relating to the Business (other than rents
receivable under Master Lease I); and
(l) all of Seller's right, title and interest in and to all other
tangible and intangible personal property used or held for use in connection
with the Business.
1.2 Excluded Assets. Notwithstanding anything to the contrary contained in
Section 1.1 hereof, the Purchased Assets shall not in any event include any real
estate assets of Seller including, without limitation, land, buildings and other
improvements thereon, including, without
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limitation, warehouse refrigeration equipment (other than the interests being
assigned that are covered by the Assumed Leases and the leasehold interests
being conveyed by Master Lease I and Master Lease II and any real estate owned
by KC Underground, Inland Quarries and Americold/Offutt).
1.3 Conveyance of Assets. The conveyance, transfer and delivery of the
Purchased Assets shall be made by Seller and accepted by Purchaser as of the
Closing Date (as hereafter defined) as follows:
(a) Seller shall execute and deliver to Purchaser a blanket bill of
sale of tangible personal property and general assignment of intangible personal
property in the form of Exhibit 1.3(a) attached hereto and made a part hereof
(the "Bill of Sale");
(b) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Contracts in the form of Exhibit 1.3(b) attached hereto and made a
part hereof (the "Assignment of Contracts");
(c) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Master Lease in the form of Exhibit 1.3(c) attached hereto and
made a part hereof (the "Assignment of Master Lease I") assigning the tenant's
interest in that certain Master Lease Agreement ("Master Lease I") dated April,
1998 between Seller and Americold Real Estate, L.P.
(d) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Customer Leases in the form of Exhibit 1.3(d) attached hereto and
made a part hereof (the "Assignment of Customer Leases");
(e) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Equipment Leases in the form of Exhibit 1.3(e) attached hereto and
made a part hereof (the "Assignment of Equipment Leases");
(f) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Office Lease in the form of Exhibit 1.3(f) attached hereto and
made a part hereof (the "Assignment of Office Lease");
(g) Seller and Purchaser shall execute and deliver a second Master
Lease Agreement in the form of Exhibit 1.3(g) attached hereto and made a part
hereof ("Master Lease II"); and
(h) Seller shall execute and deliver such additional instruments of
sale, transfer, conveyance and assignment as of the Closing Date as counsel to
Purchaser shall reasonably deem necessary or appropriate to transfer the
Purchased Assets to Purchaser.
1.4 Assumption of Liabilities. Purchaser agrees to assume, from and after
the Closing Date, (i) all duties and obligations of Seller under the Contracts,
(ii) all duties and obligations of Seller under the Assumed Leases, and (iii)
all of the accounts payable and other current liabilities of
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Seller (other than current debt service on any loans) with respect to the
Business and the Purchased Assets; provided, however, that Purchaser shall not
assume any of the Seller Transaction Expenses, as defined and provided in
Section 3.6 hereof.
1.5 Closing. The closing of the transaction contemplated herein (the
"Closing") shall occur no later than February 28, 1999 (such date to be herein
referred to as the "Closing Date") and shall take place at the offices of Arnall
Golden & Gregory, LLP or by the exchange of documents and instruments by mail,
courier, telecopy and wire transfer to the extent mutually acceptable to the
parties hereto upon compliance with the terms, conditions and contingencies
contained herein. All computations, adjustments, and transfers for the purposes
hereof shall be effective as 11:59 p.m. on the Closing Date.
ARTICLE 2
PURCHASE PRICE; ESTIMATED CLOSING AMOUNT AND
PURCHASE PRICE ADJUSTMENTS
2.1 Purchase Price. The purchase price to be paid to Seller at Closing for
the Purchased Assets ("Purchase Price") shall be $11,556,213 and shall be
payable in cash or other immediately available funds at Closing.
2.2 Adjustment to Purchase Price for Working Capital. The Purchase Price
is based upon the presumption that the Net Working Capital (as hereinafter
defined) of the Business as of the Closing Date is $3,116,400 ("Projected Net
Working Capital"). In the event the actual Net Working Capital of the Business
as of the Closing Date ("Closing Net Working Capital") is determined to be less
than or greater than Projected Net Working Capital, the Purchase Price shall be
adjusted in the following manner: Within thirty (30) days following the Closing
Date, the actual Net Working Capital as the Closing Date shall be determined by
Seller and such determination shall be subject to reasonable review and
confirmation by Purchaser. The Purchase Price shall be increased by the amount
that Closing Net Working Capital exceeds Projected Net Working Capital. The
Purchase Price shall be reduced by the amount that Projected Net Working Capital
exceeds Closing Net Working Capital. Any adjustment to the Purchase Price
pursuant to this Section 2.2 shall be due and payable by the applicable party
within ten (10) days following determination of the Closing Net Working Capital.
For purposes of this Agreement, "Net Working Capital" shall mean the current
assets of Seller with respect to the Business and the Purchased Assets minus the
current liabilities of Seller with respect to the Business and the Purchased
Assets (other than current debt service on any loans) as determined in
accordance with generally accepted accounting principles.
2.3 Adjustment to Purchase Price for KC Shutdown. In the event the amount
actually expended by KC Underground in connection with the KC Facility Shutdown
(as hereinafter defined) during the seven (7) year period ("Shutdown Adjustment
Period") immediately following the Closing Date is less than $10,000,000, then
in such event the Purchase Price shall be increased by the difference between
the amount actually expended and $10,000,000. Within sixty (60) days following
the end of the Shutdown Adjustment Period, Purchaser shall deliver to Seller
written documentation evidencing, to Seller's reasonable satisfaction, the total
amount expended by Purchaser in connection with the KC Facility Shutdown during
the Shutdown Adjustment Period.
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Any adjustment to the Purchase Price pursuant to this Section 2.3 shall be due
and payable thirty (30) days following Seller's receipt of written documentation
evidencing, to Seller's reasonable satisfaction, the total amount expended by
Purchaser in connection with the KC Facility Shutdown during the Shutdown
Adjustment Period.
2.4 Adjustment to Purchase Price for Certain Capital Expenditures. The
Purchase Price is based upon the presumption that Purchaser will incur capital
expenditures for the Business in the amount of at least $3,251,107 ("Projected
Capital Expenditures") during the period from the Closing Date until the last
day of the twelfth calendar month following the month in which the Closing
occurs ("Capital Expenditure Period"). In the event the actual amount of capital
expenditures for the Business during the Capital Expenditure Period ("Actual
Capital Expenditures") is less than the Projected Capital Expenditures, the
Purchase Price shall be increased by the difference between the Projected
Capital Expenditures and the Actual Capital Expenditures. Within sixty (60) days
following the end of the Capital Expenditure Period, Purchaser shall deliver to
Seller written documentation evidencing, to Seller's reasonable satisfaction,
the Actual Capital Expenditures by Purchaser during the Capital Expenditure
Period. Any adjustment to the Purchase Price pursuant to this Section 2.4 shall
be due and payable by Purchaser within ninety (90) days following the end of the
Capital Expenditure Period.
ARTICLE 3
ADDITIONAL COVENANTS
3.1 Due Diligence. Prior to the Closing Date, Seller shall have delivered
to Purchaser all schedules (the "Disclosure Schedules") containing information
regarding the Seller required to be attached hereto. The Disclosure Schedules
shall be deemed for all purposes of this Agreement to constitute an integral
part of this Agreement and the representations and warranties of the Seller
contained therein. The parties hereto acknowledge and agree that the information
in the Disclosure Schedules are provided based upon the knowledge of Seller,
without any inquiry, and no representations or warranties whatsoever are hereby
made with respect to the completeness or accuracy of the Disclosure Schedules.
3.2 Employment Matters. Purchaser shall have the right to hire any and all
of the employees of the Business as of the Closing Date. From and after the date
of this Agreement, Seller shall assist Purchaser with transferring the employees
of the Business to Purchaser so that the process is completed on the Closing
Date. Seller shall be responsible for providing all notices and other
communications to employees of Seller which may be required under the Worker
Adjustment and Retraining Act (the "WARN Act") or any other applicable statute,
law or regulation in connection with the transaction contemplated hereby. Seller
shall terminate all of its employees employed by the Business whom Purchaser
shall hire effective as of the Closing Date. Seller shall pay all obligations,
imposed by law or otherwise, to such employees for all periods through the
Closing Date, including, without limitation, obligations for payroll, vacation
time, sick time and other obligations in connection with such employees. Seller
shall assist Purchaser in continuing the Employee Benefit Plans. Purchaser shall
assume all the obligations and liabilities whatsoever in respect of severance,
accrued vacation or sick leave, WARN Act, income tax withholding, payroll and/or
unemployment tax, workers' compensation, pension, profit-sharing, health
insurance, FMLA
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(as hereinafter defined), COBRA (as hereinafter defined) or any other employee
or other benefit liabilities in respect of any employees in the Business or in
respect of any Employee Benefit Plans (as hereinafter defined), including,
without limitation any contribution, tax, lien, penalty, cost, interest, claim,
loss, action, suit, damage, cost assessment, withdrawal liability, liability to
the Pension Benefit Guaranty Corporation (the "PBGC"), liability under Section
412 of the Internal Revenue Code of 1986, as amended (the "Code") or Section
302(a)(2) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or other similar liability or expense of Seller.
3.3 Consents. Prior to the Closing, Seller shall deliver to Purchaser
copies of all correspondence to and from landlords and tenants of the Assumed
Leases and the landlords of the subleased facilities pursuant to Master Lease I
and Master Lease II. In addition, prior to the Closing Date, Seller shall
deliver to Purchaser consents from the landlords and/or tenants as applicable of
the Assumed Leases and the landlords of the subleased facilities pursuant to
Master Lease I and Master Lease II. Purchaser agrees to cooperate with Seller,
upon Seller's request, in Seller's effort to obtain the required consents. Any
charges imposed by the landlords or other parties for such consents shall be
borne by Seller.
3.4 Allocation of Purchase Price Among Purchased Assets. The Purchase
Price shall be allocated for tax purposes among each item or class of Purchased
Assets as mutually agreed to by Purchaser and Seller and set forth on Schedule
3.4 attached hereto. Seller and Purchaser agree that they will prepare and file
any notice or other filing required pursuant to Section 1060 of the Code, and
that any such notices or filings will be prepared based upon such tax allocation
of the Purchase Price. Purchaser agrees to send to Seller a completed copy of
its Form 8594 ("Asset Acquisition Statement under Section 1060") with respect to
this transaction prior to filing such form with the Internal Revenue Service.
3.5 Tax Matters.
(a) As used in this Agreement, the following terms have the
specified meanings:
(i) "Tax Authority" shall mean any United States federal,
foreign, national, state, county or municipal or other local government, any
subdivision, agency, commission or authority thereof, or any quasi-governmental
body exercising any taxing authority or any other authority exercising tax
regulatory authority.
(ii) "Tax Return" shall mean any return, amended return,
estimated return, information return and statement (including any related or
supporting information) filed or to be filed with any Tax Authority in
connection with the determination, assessment, collection or administration of
any Tax.
(iii) "Tax(es)" shall mean all taxes, charges, fees, interest,
fines, penalties, additions to tax or other assessments, including without
limitation, income, excise, environmental, property, sales, gross receipts,
gains, transfer, occupation, privilege, employment (including social security
and unemployment), use, value added, capital stock or surplus, franchise
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taxes, advance corporate tax and customs duties imposed by any Tax Authority,
payable by Seller or relating to or chargeable against Seller's assets, revenues
or income.
(b) Subject to Section 3.5(c) hereof, Seller shall be solely
responsible for and shall pay, without any cost to the Purchaser (i) any and all
Taxes for which Seller is or may be liable, arising from Seller's activities,
the Business or use of the Purchased Assets prior to Closing (regardless of
whether the filing of any Tax Return with respect thereto or payment of any
amount in respect thereof is filed, paid or due prior to, on or after the
Closing Date), (ii) any Taxes with respect to the acquisition by Purchaser from
Seller of the Purchased Assets, and all other Taxes, if any, imposed by any Tax
Authority assessed in connection with, on account of or resulting from the
consummation of the transfer of the Purchased Assets to the Purchaser.
(c) Real and personal property ad valorem Taxes, if any, with
respect to the Purchased Assets shall be prorated between Seller on the one
hand, and the Purchaser on the other hand, as of the Closing Date. Should any
amount of such Taxes to be prorated not be fully determined as of the Closing
Date, a mutually satisfactory estimate of such amount, made on the basis of
Seller's records, shall be used as the basis for settlement at Closing, and the
amount finally determined will be prorated and appropriate settlement
adjustments made as soon as practicable after such final determination.
(d) Except as otherwise provided in this Agreement, the parties
hereby agree that each of them shall cooperate with the other in executing or
causing to be executed any required document and by making available to the
other all work papers, records and notes of any kind at all reasonable times for
the purpose of allowing the appropriate party to complete Tax Returns,
participate in a proceeding, obtain refunds, make any determination required
under this Agreement or defend or prosecute Tax claims. Notwithstanding anything
to the contrary contained herein, Seller shall have sole and exclusive
responsibility and authority to prepare and file all Tax Returns concerning
Seller related activities occurring prior to the Closing, including, without
limitation, its operation of the Business and its use of the Purchased Assets
and all matters under agreements whether or not being assumed by Purchaser
(regardless of when such return is filed). Purchaser shall be given copies of
any such return related to the Business filed by Seller.
3.6 Transaction Expenses. All of the expenses incurred by Purchaser in
connection with the authorization, negotiation, preparation, execution and
performance of this Agreement and other agreements referred to herein and the
consummation of the transactions contemplated hereby, including, without
limitation, all fees and expenses of agents, representatives, brokers, counsel
and accountants for Purchaser, shall be paid by Purchaser ("Purchaser
Transaction Expenses"). All expenses incurred by the Seller in connection with
the authorization, negotiation, preparation, execution and performance of this
Agreement and the other agreements referred to herein and the consummation of
the transactions contemplated hereby, including without limitation, all fees and
expenses of agents, representatives, brokers, counsel and accountants, shall be
paid by the Seller ("Seller Transaction Expenses").
3.7 Access to Books and Records. After the Closing, Purchaser shall
preserve all of the records and books pertaining to the Business and the
Purchased Assets relating to the period
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prior to Closing until the later of (a) the longest time period prescribed by
any relevant Tax Authority for the retention of supporting documentation for Tax
Returns for periods beginning prior to the Closing date, and regardless of
whether such periods end before or after the Closing Date or (b) the seventh
anniversary of the Closing Date, and, until such time, make them available,
during normal business hours, to Seller and its designees, counsel, accountants,
and others authorized by them for inspection and the making of copies thereof.
3.8 Operation in Ordinary Course. Seller shall operate the Business in the
ordinary course through the Closing Date.
3.9 Closure of Kansas City Facility.
(a) Purchaser and Seller hereby acknowledge the following: Seller
has conveyed its refrigerated warehouse facility in Kansas City, Kansas (the "KC
Facility") to KC Underground, which is wholly-owned by Seller. Seller was
carrying a liability on its books in the amount of $14,896,000 for the costs
associated with closing the KC Facility and maintaining the existing caves at
the KC Facility to the extent required to support third party surface rights
(such closing and maintenance collectively, the "KC Facility Shutdown"). By
virtue of such transfer of the KC Facility to KC Underground, KC Underground has
assumed responsibility for the KC Facility Shutdown. Purchaser and Seller
acknowledge and agree that the Purchase Price for the Purchased Assets reflects
that KC Underground is responsible for paying the cost for the KC Facility
Shutdown, subject to the reimbursement and indemnification provisions set forth
in Section 3.9(b) below. Purchaser shall cause KC Underground to undertake the
KC Facility Shutdown in a reasonable and diligent manner, subject to
consultation with Seller. Purchaser shall keep Seller informed of the progress
of the KC Facility Shutdown by delivering periodic written reports to Seller and
Purchaser shall consult with Seller concerning the cost and method of
implementing the KC Facility Shutdown.
(b) In the event the costs associated with the KC Facility Shutdown
exceed $10,000,000, then Seller shall reimburse Purchaser for any such excess
costs and Seller hereby agrees to indemnify Purchaser for the amount of any and
all losses, costs, expenses, damages, claims or liabilities for the KC Facility
Shutdown to the extent any such amount exceeds $10,000,000 (such amount in
excess of $10,000,000 is the "Indemnified Amount"); provided, however, that the
Indemnified Amount shall be limited in all events to an amount not to exceed
$7,600,000. Seller shall pay any Indemnified Amount within thirty (30) days
following Seller's receipt of written notice from Purchaser that such
Indemnified Amount is due, and such notice from Purchaser shall include
documentation evidencing, to Seller's reasonable satisfaction, the total amount
expended by Purchaser in connection with the KC Facility Shutdown as of the date
of the notice.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
In order to induce the Purchaser to enter into this Agreement and
consummate the transactions contemplated hereby, Seller represents and warrants
to the Purchaser as follows, each of which warranties and representations is
material to and relied upon by the Purchaser.
4.1 Organization and Authority of Seller. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Oregon. Seller has all necessary corporate power and authority to own, lease and
operate its properties and conduct its business as it is currently being
conducted.
4.2 Corporate Power and Authority; Due Authorization. Seller has full
corporate power and authority to execute and deliver this Agreement and each of
the Transaction Documents to which Seller is or will be a party and to
consummate the transactions contemplated hereby. "Transaction Documents" means
each of the agreements, documents and instruments referenced in this Agreement
to be executed and delivered by Seller. Prior to the Closing, the directors and
the stockholders of Seller shall have duly approved and authorized the execution
and delivery of this Agreement and each of the Transaction Documents to which
Seller is or will be a party and the consummation of the transactions
contemplated hereby and thereby, and no other corporate proceedings shall then
be necessary. Assuming that this Agreement and each of the Transaction Documents
to which Purchaser is a party constitutes a valid and binding agreement of the
Purchaser, this Agreement and each of the Transaction Documents constitutes, or
will constitute when executed and delivered, a valid and binding agreement of
Seller, in each case enforceable in accordance with its terms, subject to laws
of general application in effect affecting creditors' rights and subject to the
exercise of judicial discretion in accordance with general equitable principles.
4.3 Tax Returns and Payments. Seller has correctly and timely filed all
Tax Returns required by law to be filed on or before the date of this Agreement
and shall correctly and timely file all Tax Returns required by law to be filed
on or prior to the Closing Date. All such Tax Returns are true, correct and
complete in all respects, and all amounts shown as owing thereon have been paid.
No penalties, interest or other charges are or will be due with respect to the
late filing of any such Tax Returns. Seller has made all estimated Tax payments
required to be made under the Code. Taxes for all Tax periods (or portions
thereof) ending prior to or on the Closing Date have been, or prior to the
Closing shall be, fully paid.
4.4 Litigation. To Seller's knowledge, without inquiry, there is not (i)
any material claim, legal action, suit, arbitration, governmental investigation
or other legal or administrative proceeding affecting the delivery of the
Purchased Assets as required hereunder or (ii) order, decree or judgment in
progress, pending or in effect or threatened, affecting the delivery of the
Purchased Assets as required hereunder and Seller does not know or have reason
to know of any basis for the same.
4.5 Benefit Plans and ERISA. To Seller's knowledge, without inquiry,
Schedule 4.5 sets forth a true and complete list of each "employee benefit plan"
(as defined by Section 3(3) of the
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Employee Retirement Income Security Act of 1974, as amended ("ERISA")), (each
such plan, agreement, policy, trust fund or arrangement is referred to herein as
an "Employee Benefit Plan", and collectively, the "Employee Benefit Plans" that
is currently in effect, or which has been approved before the date hereof but is
not yet effective, for the benefit of employees, and their beneficiaries or any
other persons performing services for Seller in the Business.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
In order to induce Seller to enter into this Agreement and consummate the
transactions contemplated hereby, the Purchaser represents and warrants to
Seller as follows, each of which representations and warranties is material to
and relied upon by Seller:
5.1 Organization of the Purchaser. The Purchaser is a limited liability
company duly organized and validly existing under the laws of the State of
Delaware and has the power and authority to own its property and to carry on its
business as now being conducted by it.
5.2 Power and Authority; Due Authorization. The Purchaser has full power
and authority to execute and deliver this Agreement and each of the other
agreements, documents and instruments referenced in this Agreement to which the
Purchaser is or will be a party (the "Purchaser's Transaction Documents") and to
consummate the transactions contemplated hereby and thereby. Prior to the
Closing, the Manager of the Purchaser shall have duly approved and authorized
the execution and delivery of this Agreement and each of the Purchaser's
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, and no other proceedings on the part of the Purchaser are
necessary to approve and authorize the execution and delivery of this Agreement
and such Purchaser's Transaction Documents and the consummation of the
transactions contemplated hereby and thereby. Assuming that this Agreement and
each of the Purchaser's Transaction Documents constitutes a valid and binding
agreement of Seller, this Agreement and each of the Purchaser's Transaction
Documents constitutes, or will constitute when executed and delivered, a valid
and binding agreement of the Purchaser, enforceable against the Purchaser in
accordance with its terms, subject to laws of general application in effect
affecting creditors' rights and subject to the exercise of judicial discretion
in accordance with general equitable principles.
ARTICLE 6
CONDITIONS TO OBLIGATIONS OF
THE PURCHASER TO CLOSE
Each and every obligation of the Purchaser under this Agreement to be
performed on or prior to the Closing shall be subject to the fulfillment, on or
prior to the Closing, of each of the following conditions unless and to the
extent any such condition is expressly waived in writing by Purchaser:
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6.1 Representations and Warranties True at Closing. The representations
and warranties made by Seller in or pursuant to this Agreement or given on its
behalf hereunder shall be true and correct in all material respects on and as of
the Closing Date.
6.2 Obligations Performed. Seller shall have performed and complied in all
material respects with all agreements, conditions and obligations required by
this Agreement to be performed or complied with by it prior to or at the
Closing.
6.3 Consents. Seller shall have obtained and delivered to Purchaser
written consents of all persons or entities whose consent is required to
consummate the transactions contemplated herein, if any, and all of such
consents shall remain in full force and effect at and as of the Closing,
including the consents to assignment of the Assumed Leases and to subleasing
under Master Lease I and Master Lease II.
6.4 Closing Deliveries. Seller shall have delivered to Purchaser each of
the following, together with any additional items which Purchaser may reasonably
request to effect the transactions contemplated herein:
(a) possession of the Purchased Assets;
(b) a certified copy of the corporate resolutions of the directors
of Seller authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Transaction Documents by
Seller;
(c) the documents and instruments described in Section 1.3 hereof;
(d) written consents from all persons and entities whose consent to
the transactions contemplated herein is required;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
6.5 Disclosure Schedules. Seller shall have provided Purchaser with
updated Disclosure Schedules dated as of the Closing Date.
6.6 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
6.7 No Changes Prior to Closing. After execution of this Agreement and
prior to the Closing Date, none of the following shall have occurred:
(a) damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, materially and adversely affecting the Business; or
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(b) the legal inability of Seller to convey, assign and transfer to
Purchaser any material portion of the Purchased Assets with the effect of
materially and adversely affecting the ability of Purchaser to utilize the
Purchased Assets in a manner consistent with the operation of the Business.
ARTICLE 7
CONDITIONS TO SELLER'S OBLIGATIONS
Each and every obligation of Seller under this Agreement to be performed
on or prior to the Closing, shall be subject to the fulfillment, on or prior to
the Closing, of each of the following conditions unless and to the extent any
such condition is specifically waived in writing by Seller:
7.1 Representations and Warranties True at Closing. The representations
and warranties made by Purchaser in or pursuant to this Agreement or given on
its behalf hereunder shall be true and correct in all material respects, on and
as of the Closing Date.
7.2 Obligations Performed. The Purchaser shall have performed and complied
in all material respects with all agreements, conditions and obligations
required by this Agreement to be performed or complied with by it prior to or at
the Closing.
7.3 Closing Deliveries. The Purchaser shall have delivered to Seller each
of the following, together with any additional items which Seller may reasonably
request to effect the transactions contemplated herein:
(a) the Purchase Price;
(b) evidence of authority of the Manager of the Purchaser
authorizing the transactions contemplated herein and the execution, delivery and
performance of this Agreement and the Purchaser's Transaction Documents by the
Purchaser, together with incumbency certificates with respect to the respective
managers or officers of the Purchaser executing documents or instruments on
behalf of the Purchaser;
(c) the documents and instruments described in Section 1.3 hereof;
(d) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
7.4 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
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ARTICLE 8
MISCELLANEOUS PROVISIONS
8.1 Severability. If any provision of this Agreement is prohibited by the
laws of any jurisdiction as those laws apply to this Agreement, that provision
shall be ineffective to the extent of such prohibition and/or shall be modified
to conform with such laws, without invalidating the remaining provisions hereto.
8.2 Modification. This Agreement may not be changed or modified except in
writing specifically referring to this Agreement and signed by each of the
parties hereto.
8.3 Assignment, Survival and Binding Agreement. This Agreement and the
Transaction Documents and the Purchaser's Transaction Documents may not be
assigned by the Seller without the prior written consent of Purchaser. The terms
and conditions hereof shall survive the Closing as provided herein and shall
inure to the benefit of and be binding upon the parties hereto and their
respective heirs, personal representatives, successors and assigns.
8.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.5 Notices. All notices, requests, demands, claims or other
communications hereunder will be in writing and shall be deemed duly given if
personally delivered, sent by a recognized overnight delivery service which
guarantees next day delivery ("Overnight Delivery") or mailed by registered or
certified mail, return receipt requested, postage prepaid and addressed to the
intended recipient as set forth below:
If to Seller: Americold Corporation
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
If to the Purchaser: AmeriCold Logistics, LLC
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
or at such other address as any party hereto notifies the other parties hereof
in writing. The parties hereto agree that notices or other communications that
are sent in accordance herewith (i) by personal delivery, will be deemed
received on the day sent or on the first business day thereafter if not sent on
a business day, (ii) by Overnight Delivery, will be deemed received on the first
business day immediately following the date sent, and (iii) by U.S. mail, will
be deemed received three (3) business days immediately following the date sent.
For purposes of this Agreement, a
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"business day" is a day on which Purchaser is open for business and shall not
include a Saturday or Sunday or legal holiday. Notwithstanding anything to the
contrary in this Agreement, no action shall be required of the parties hereto
except on a business day and in the event an action is required on a day which
is not a business day, such action shall be required to be performed on the next
succeeding day which is a business day.
8.6 Entire Agreement; No Third Party Beneficiaries. This Agreement,
together with the Exhibits and Schedules attached hereto, constitutes the entire
agreement and supersedes any and all other prior agreements and undertakings,
both written and oral, among the parties, or any of them, with respect to the
subject matter hereof and, except as otherwise expressly provided herein, is not
intended to confer upon any person other than Seller and Purchaser, any rights
or remedies hereunder.
8.7 Further Assurances. The parties to this Agreement agree to execute and
deliver, both before and after the Closing, any additional information,
documents or agreements contemplated hereby and/or necessary or appropriate to
effect and consummate the transactions contemplated hereby. Seller agrees to
provide to Purchaser, both before and after the Closing, such information as
Purchaser may reasonably request in order to consummate the transactions
contemplated hereby and to effect an orderly transition of the Business
following Closing.
8.8 Governing Law and Submission to Jurisdiction. Except as otherwise
expressly provided herein, this Agreement shall be governed by and construed
under the laws of the State of Delaware without giving effect to otherwise
applicable principles of conflicts of laws.
8.9 Pronouns. All personal pronouns in this Agreement, whether used in the
masculine, feminine or neuter gender shall include all other genders, and the
singular shall include the plural and the plural shall include the singular.
8.10 Survival of Representations and Warranties. The representations and
warranties set forth in this Agreement shall survive the Closing for a period of
one year and thereafter such representations and warranties shall be null and
void with no further force and effect.
[Signatures on next page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
PURCHASER:
AMERICOLD LOGISTICS, LLC
By: /s/ Frederick B. Beilstein III
-------------------------------
Name: Frederick B. Beilstein III
-----------------------------
Its: Senior Vice President
------------------------------
SELLER:
AMERICOLD CORPORATION
By: /s/ Daniel F. McNamara
-------------------------------
Name: Daniel F. McNamara
-----------------------------
Its: President
------------------------------
<PAGE> 16
LIST OF SCHEDULES AND EXHIBITS
Schedule 1.1(a) Fixed Assets
Schedule 1.1(b) Contracts
Schedule 1.1(c) Assumed Leases
Schedule 1.1(e) Intellectual Property
Schedule 1.1(j) Investment Securities
Schedule 3.4 Purchase Price Allocation
Schedule 4.5 Employee Benefit Plans
Exhibit 1.3(a) Bill of Sale
Exhibit 1.3(b) Assignment of Contracts
Exhibit 1.3(c) Assignment of Master Lease I
Exhibit 1.3(d) Assignment of Customer Leases
Exhibit 1.3(e) Assignment of Equipment Leases
Exhibit 1.3(f) Assignment of Office Lease
Exhibit 1.3(g) Master Lease II
<PAGE> 1
Exhibit 2.2
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made as of the 9th day
of March, 1999, by and between VORNADO CRESCENT LOGISTICS OPERATING PARTNERSHIP,
a Delaware general partnership ("Purchaser"), and URS LOGISTICS, INC., a
Delaware corporation ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business of providing refrigerated, frozen and
dry warehouse storage services, logistics, distribution and transportation
services and other services and limited mining operations (collectively, the
"Business"); and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, substantially all of the assets of Seller used or held for
use in the Business except for the Excluded Assets (as hereinafter defined)
pursuant to the terms of this Agreement; and
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the transactions contemplated herein and certain additional
agreements related thereto.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF PURCHASED ASSETS
1.1 Assets to be Acquired. Subject to and upon the terms and conditions
set forth herein, Purchaser hereby agrees to purchase from Seller, and Seller
hereby agrees to sell, transfer and assign to Purchaser all of the tangible and
intangible assets of Seller (but excluding the Excluded Assets) used or held for
use in connection with the Business, including, without limitation, the
following (collectively, the "Purchased Assets"):
(a) all of Seller's vehicles and equipment (excluding refrigeration
equipment which is part of the real estate) used or held for use by Seller in
connection with the Business as of the Closing (as hereinafter defined),
including, but not limited to, tools, fork lifts, racks, supplies, computers and
computer equipment, furniture and fixtures and those items listed on Schedule
1.1(a) attached hereto (the "Fixed Assets"); and
(b) all of Seller's right, title and interest in, to and under all
written or oral contracts, license agreements and all other agreements,
commitments and other instruments to which the Purchased Assets are subject or
bound or that otherwise pertain to the Business including without limitation the
agreements set forth in Schedule 1.1(b) attached hereto (collectively, the
"Contracts"); and
<PAGE> 2
(c) all of Seller's interest in, and rights and benefits accruing to
Seller under, those certain leases to which Seller is a party and which pertain
to the Business as identified on Schedule 1.1(c) attached hereto (collectively,
the "Assumed Leases"); and
(d) all of Seller's membership interest in and to AmeriCold
Logistics, LLC, a Delaware limited liability company ("AmeriCold Logistics I"),
which is wholly owned by Seller; and
(e) all rights and interests of Seller in any trademarks, service
marks, copyrights, logos, patents, inventions, processes, franchises,
registrations, license agreements, trade secrets, customer lists, trade lists
and trade or service names used in the Business, including without limitation
those marks and names listed on Schedule 1.1(e) attached hereto (collectively,
the "Intellectual Property"); and
(f) all of Seller's licenses, consents, permits, variances,
certifications and approvals of governmental agencies used or held for use in
connection with the Business, to the extent assignable; and
(g) all of Seller's right, title and interest in and to its
telephone numbers and the directory advertising for such telephone numbers for
each of its facilities and offices, to the extent assignable; and
(h) all of Seller's right, title and interest in and to its books
and records related to the Business and the Purchased Assets; and
(i) all of Seller's right, title and interest in and to its computer
software and licenses therefor and any proprietary technology and processes;
(j) all of Seller's right, title and interest in and to any voting
securities of any corporation or other entity; and
(k) all of Seller's right, title and interest in and to all of the
cash, accounts receivable, other rights to receive payment from customers of the
Business and all other current assets relating to the Business (other than rents
receivable under Master Lease I); and
(l) all of Seller's right, title and interest in and to all other
tangible and intangible personal property used or held for use in connection
with the Business.
1.2 Excluded Assets. Notwithstanding anything to the contrary contained in
Section 1.1 hereof, the Purchased Assets shall not in any event include any real
estate assets of Seller including, without limitation, land, buildings and other
improvements thereon, including, without limitation, warehouse refrigeration
equipment (other than the interests being assigned that are covered by the
Assumed Leases and the leasehold interests being conveyed by Master Lease I and
Master Lease II and any real estate owned by AmeriCold Logistics I or its
subsidiaries).
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<PAGE> 3
1.3 Conveyance of Assets. The conveyance, transfer and delivery of the
Purchased Assets shall be made by Seller and accepted by Purchaser as of the
Closing Date (as hereafter defined) as follows:
(a) Seller shall execute and deliver to Purchaser a blanket bill of
sale of tangible personal property and general assignment of intangible personal
property in the form of Exhibit 1.3(a) attached hereto and made a part hereof
(the "Bill of Sale");
(b) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Contracts in the form of Exhibit 1.3(b) attached hereto and made a
part hereof (the "Assignment of Contracts");
(c) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Master Lease in the form of Exhibit 1.3(c) attached hereto and
made a part hereof (the "Assignment of Master Lease I") assigning the tenant's
interest in that certain Master Lease Agreement ("Master Lease I") dated April,
1998 between Seller and URS Real Estate, L.P.
(d) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Customer Leases in the form of Exhibit 1.3(d) attached hereto and
made a part hereof (the "Assignment of Customer Leases");
(e) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Equipment Leases in the form of Exhibit 1.3(e) attached hereto and
made a part hereof (the "Assignment of Equipment Leases");
(f) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Office Lease in the form of Exhibit 1.3(f) attached hereto and
made a part hereof (the "Assignment of Office Lease");
(g) Seller and Purchaser shall execute and deliver a second Master
Lease Agreement in the form of Exhibit 1.3(g) attached hereto and made a part
hereof ("Master Lease II"); and
(h) Seller and Purchaser shall execute and deliver an Assignment of
Membership Interest of AmeriCold Logistics, LLC in the form of Exhibit 1.3(h)
attached hereto and made a part hereof ("Assignment of AmeriCold Logistics,
LLC"); and
(i) Seller shall execute and deliver such additional instruments of
sale, transfer, conveyance and assignment as of the Closing Date as counsel to
Purchaser shall reasonably deem necessary or appropriate to transfer the
Purchased Assets to Purchaser.
Purchaser may direct Seller to convey any or all of the Purchased Assets
directly to Purchaser's wholly owned subsidiary, AmeriCold Logistics II, LLC, a
Delaware limited liability company ("AmeriCold Logistics II"), in which event
all of the rights and obligations of Purchaser under this Agreement with respect
to any of the Purchased Assets so conveyed shall be hereby assigned to and
assumed by AmeriCold Logistics II.
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<PAGE> 4
1.4 Assumption of Liabilities. Purchaser agrees to assume, from and after
the Closing Date, (i) all duties and obligations of Seller under the Contracts,
(ii) all duties and obligations of Seller under the Assumed Leases, and (iii)
all of the accounts payable and other current liabilities of Seller (other than
current debt service on any loans) with respect to the Business and the
Purchased Assets; provided, however, that Purchaser shall not assume any of the
Seller Transaction Expenses, as defined and provided in Section 3.6 hereof.
1.5 Closing. The closing of the transaction contemplated herein (the
"Closing") shall occur no later than March 15th, 1999 (the date of Closing to be
herein referred to as the "Closing Date") and shall take place at the offices of
Arnall Golden & Gregory, LLP or by the exchange of documents and instruments by
mail, courier, telecopy and wire transfer to the extent mutually acceptable to
the parties hereto upon compliance with the terms, conditions and contingencies
contained herein. All computations, adjustments, and transfers for the purposes
hereof shall be effective as 11:59 p.m. on the Closing Date.
ARTICLE 2
PURCHASE PRICE; ESTIMATED CLOSING AMOUNT AND
PURCHASE PRICE ADJUSTMENTS
2.1 Purchase Price. The purchase price to be paid to Seller at Closing for
the Purchased Assets ("Purchase Price") shall be $17,837,867 and shall be
payable in cash or other immediately available funds at Closing.
2.2 Adjustment to Purchase Price for Working Capital. The Purchase Price
is based upon the presumption that the Net Working Capital (as hereinafter
defined) of the Business (excluding any working capital of AmeriCold Logistics
I) as of the Closing Date is $982,100 ("Projected Net Working Capital"). In the
event the actual Net Working Capital of the Business as of the Closing Date
("Closing Net Working Capital") is determined to be less than or greater than
Projected Net Working Capital, the Purchase Price shall be adjusted in the
following manner: Within thirty (30) days following the Closing Date, the actual
Net Working Capital as the Closing Date shall be determined by Seller and such
determination shall be subject to reasonable review and confirmation by
Purchaser. The Purchase Price shall be increased by the amount that Closing Net
Working Capital exceeds Projected Net Working Capital. The Purchase Price shall
be reduced by the amount that Projected Net Working Capital exceeds Closing Net
Working Capital. Any adjustment to the Purchase Price pursuant to this Section
2.2 shall be due and payable by the applicable party within ten (10) days
following determination of the Closing Net Working Capital. For purposes of this
Agreement, "Net Working Capital" shall mean the current assets of Seller with
respect to the Business and the Purchased Assets minus the current liabilities
of Seller with respect to the Business and the Purchased Assets (other than
current debt service on any loans) as determined in accordance with generally
accepted accounting principles; provided, however, the Net Working Capital of
Seller does not include any assets or liabilities of AmeriCold Logistics I.
2.3 Adjustment to Purchase Price for Certain Capital Expenditures. The
Purchase Price is based upon the presumption that Purchaser will incur capital
expenditures for the Business (excluding capital expenditures of AmeriCold
Logistics I) in the amount of at least $1,534,784
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("Projected Capital Expenditures") during the period from the Closing Date until
the last day of the twelfth calendar month following the month in which the
Closing occurs ("Capital Expenditure Period"). In the event the actual amount of
capital expenditures for the Business (excluding capital expenditures of
AmeriCold Logistics I) during the Capital Expenditure Period ("Actual Capital
Expenditures") is less than the Projected Capital Expenditures, the Purchase
Price shall be increased by the difference between the Projected Capital
Expenditures and the Actual Capital Expenditures. Within sixty (60) days
following the end of the Capital Expenditure Period, Purchaser shall deliver to
Seller written documentation evidencing, to Seller's reasonable satisfaction,
the Actual Capital Expenditures by Purchaser during the Capital Expenditure
Period. Any adjustment to the Purchase Price pursuant to this Section 2.3 shall
be due and payable by Purchaser within ninety (90) days following the end of the
Capital Expenditure Period.
ARTICLE 3
ADDITIONAL COVENANTS
3.1 Due Diligence. Prior to the Closing Date, Seller shall have delivered
to Purchaser all schedules (the "Disclosure Schedules") containing information
regarding the Seller required to be attached hereto. The Disclosure Schedules
shall be deemed for all purposes of this Agreement to constitute an integral
part of this Agreement and the representations and warranties of the Seller
contained therein. The parties hereto acknowledge and agree that the information
in the Disclosure Schedules are provided based upon the knowledge of Seller,
without any inquiry, and no representations or warranties whatsoever are hereby
made with respect to the completeness or accuracy of the Disclosure Schedules.
3.2 Employment Matters. Purchaser and AmeriCold Logistics II shall have
the right to hire any and all of the employees of the Business as of the Closing
Date. From and after the date of this Agreement, Seller shall assist Purchaser
and AmeriCold Logistics II with transferring the employees of the Business to
Purchaser and AmeriCold Logistics II so that the transfer is accomplished on the
Closing Date. Seller shall be responsible for providing all notices and other
communications to employees of Seller which may be required under the Worker
Adjustment and Retraining Act (the "WARN Act") or any other applicable statute,
law or regulation in connection with the transaction contemplated hereby. Seller
shall terminate all of its employees employed by the Business whom Purchaser and
AmeriCold Logistics II hire effective as of the Closing Date. Seller shall pay
all obligations, imposed by law or otherwise, to such employees for all periods
through the Closing Date, including, without limitation, obligations for
payroll, vacation time, sick time and other obligations in connection with such
employees. Seller shall assist Purchaser and AmeriCold Logistics II in
continuing the Employee Benefit Plans. Purchaser and AmeriCold Logistics II
shall assume all the obligations and liabilities whatsoever in respect of
severance, accrued vacation or sick leave, WARN Act, income tax withholding,
payroll and/or unemployment tax, workers' compensation, pension, profit-sharing,
health insurance, FMLA (as hereinafter defined), COBRA (as hereinafter defined)
or any other employee or other benefit liabilities in respect of any employees
in the Business or in respect of any Employee Benefit Plans (as hereinafter
defined), including, without limitation any contribution, tax, lien, penalty,
cost, interest, claim, loss, action, suit, damage, cost assessment, withdrawal
liability, liability to the Pension Benefit Guaranty Corporation (the "PBGC"),
liability under Section 412 of the Internal Revenue
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Code of 1986, as amended (the "Code") or Section 302(a)(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or other similar
liability or expense of Seller.
3.3 Consents. Prior to the Closing, Seller shall deliver to Purchaser
copies of all correspondence to and from landlords and tenants of the Assumed
Leases and the landlords of the subleased facilities pursuant to Master Lease I
and Master Lease II. In addition, prior to the Closing Date, Seller shall
deliver to Purchaser consents from the landlords and/or tenants as applicable of
the Assumed Leases and the landlords of the subleased facilities pursuant to
Master Lease I and Master Lease II. Purchaser agrees to cooperate with Seller,
upon Seller's request, in Seller's effort to obtain the required consents. Any
charges imposed by the landlords or other parties for such consents shall be
borne by Seller.
3.4 Allocation of Purchase Price Among Purchased Assets. The Purchase
Price shall be allocated for tax purposes among each item or class of Purchased
Assets as mutually agreed to by Purchaser and Seller and set forth on Schedule
3.4 attached hereto. Seller and Purchaser agree that they will prepare and file
any notice or other filing required pursuant to Section 1060 of the Code, and
that any such notices or filings will be prepared based upon such tax allocation
of the Purchase Price. Purchaser agrees to send to Seller a completed copy of
its Form 8594 ("Asset Acquisition Statement under Section 1060") with respect to
this transaction prior to filing such form with the Internal Revenue Service.
3.5 Tax Matters.
(a) As used in this Agreement, the following terms have the
specified meanings:
(i) "Tax Authority" shall mean any United States federal,
foreign, national, state, county or municipal or other local government, any
subdivision, agency, commission or authority thereof, or any quasi-governmental
body exercising any taxing authority or any other authority exercising tax
regulatory authority.
(ii) "Tax Return" shall mean any return, amended return,
estimated return, information return and statement (including any related or
supporting information) filed or to be filed with any Tax Authority in
connection with the determination, assessment, collection or administration of
any Tax.
(iii) "Tax(es)" shall mean all taxes, charges, fees, interest,
fines, penalties, additions to tax or other assessments, including without
limitation, income, excise, environmental, property, sales, gross receipts,
gains, transfer, occupation, privilege, employment (including social security
and unemployment), use, value added, capital stock or surplus, franchise taxes,
advance corporate tax and customs duties imposed by any Tax Authority, payable
by Seller or relating to or chargeable against Seller's assets, revenues or
income.
(b) Subject to Section 3.5(c) hereof, Seller shall be solely
responsible for and shall pay, without any cost to the Purchaser (i) any and all
Taxes for which Seller is or may be liable, arising from Seller's activities,
the Business or use of the Purchased Assets prior to Closing (regardless of
whether the filing of any Tax Return with respect thereto or payment of any
amount
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in respect thereof is filed, paid or due prior to, on or after the Closing
Date), (ii) any Taxes with respect to the acquisition by Purchaser from Seller
of the Purchased Assets, and all other Taxes, if any, imposed by any Tax
Authority assessed in connection with, on account of or resulting from the
consummation of the transfer of the Purchased Assets to the Purchaser.
(c) Real and personal property ad valorem Taxes, if any, with
respect to the Purchased Assets shall be prorated between Seller on the one
hand, and the Purchaser on the other hand, as of the Closing Date. Should any
amount of such Taxes to be prorated not be fully determined as of the Closing
Date, a mutually satisfactory estimate of such amount, made on the basis of
Seller's records, shall be used as the basis for settlement at Closing, and the
amount finally determined will be prorated and appropriate settlement
adjustments made as soon as practicable after such final determination.
(d) Except as otherwise provided in this Agreement, the parties
hereby agree that each of them shall cooperate with the other in executing or
causing to be executed any required document and by making available to the
other all work papers, records and notes of any kind at all reasonable times for
the purpose of allowing the appropriate party to complete Tax Returns,
participate in a proceeding, obtain refunds, make any determination required
under this Agreement or defend or prosecute Tax claims. Notwithstanding anything
to the contrary contained herein, Seller shall have sole and exclusive
responsibility and authority to prepare and file all Tax Returns concerning
Seller related activities occurring prior to the Closing, including, without
limitation, its operation of the Business and its use of the Purchased Assets
and all matters under agreements whether or not being assumed by Purchaser
(regardless of when such return is filed). Purchaser shall be given copies of
any such return related to the Business filed by Seller.
3.6 Transaction Expenses. All of the expenses incurred by Purchaser in
connection with the authorization, negotiation, preparation, execution and
performance of this Agreement and other agreements referred to herein and the
consummation of the transactions contemplated hereby, including, without
limitation, all fees and expenses of agents, representatives, brokers, counsel
and accountants for Purchaser, shall be paid by Purchaser ("Purchaser
Transaction Expenses"). All expenses incurred by the Seller in connection with
the authorization, negotiation, preparation, execution and performance of this
Agreement and the other agreements referred to herein and the consummation of
the transactions contemplated hereby, including without limitation, all fees and
expenses of agents, representatives, brokers, counsel and accountants, shall be
paid by the Seller ("Seller Transaction Expenses").
3.7 Access to Books and Records. After the Closing, Purchaser shall
preserve all of the records and books pertaining to the Business and the
Purchased Assets relating to the period prior to Closing until the later of (a)
the longest time period prescribed by any relevant Tax Authority for the
retention of supporting documentation for Tax Returns for periods beginning
prior to the Closing date, and regardless of whether such periods end before or
after the Closing Date or (b) the seventh anniversary of the Closing Date, and,
until such time, make them available, during normal business hours, to Seller
and its designees, counsel, accountants, and others authorized by them for
inspection and the making of copies thereof.
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<PAGE> 8
3.8 Operation in Ordinary Course. Seller shall operate the Business in the
ordinary course through the Closing Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
In order to induce the Purchaser to enter into this Agreement and
consummate the transactions contemplated hereby, Seller represents and warrants
to the Purchaser as follows, each of which warranties and representations is
material to and relied upon by the Purchaser.
4.1 Organization and Authority of Seller. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Seller has all necessary corporate power and authority to own, lease
and operate its properties and conduct its business as it is currently being
conducted.
4.2 Corporate Power and Authority; Due Authorization. Seller has full
corporate power and authority to execute and deliver this Agreement and each of
the Transaction Documents to which Seller is or will be a party and to
consummate the transactions contemplated hereby. "Transaction Documents" means
each of the agreements, documents and instruments referenced in this Agreement
to be executed and delivered by Seller. Prior to the Closing, the directors and
the stockholders of Seller shall have duly approved and authorized the execution
and delivery of this Agreement and each of the Transaction Documents to which
Seller is or will be a party and the consummation of the transactions
contemplated hereby and thereby, and no other corporate proceedings shall then
be necessary. Assuming that this Agreement and each of the Transaction Documents
to which Purchaser is a party constitutes a valid and binding agreement of the
Purchaser, this Agreement and each of the Transaction Documents constitutes, or
will constitute when executed and delivered, a valid and binding agreement of
Seller, in each case enforceable in accordance with its terms, subject to laws
of general application in effect affecting creditors' rights and subject to the
exercise of judicial discretion in accordance with general equitable principles.
4.3 Tax Returns and Payments. Seller has correctly and timely filed all
Tax Returns required by law to be filed on or before the date of this Agreement
and shall correctly and timely file all Tax Returns required by law to be filed
on or prior to the Closing Date. All such Tax Returns are true, correct and
complete in all respects, and all amounts shown as owing thereon have been paid.
No penalties, interest or other charges are or will be due with respect to the
late filing of any such Tax Returns. Seller has made all estimated Tax payments
required to be made under the Code. Taxes for all Tax periods (or portions
thereof) ending prior to or on the Closing Date have been, or prior to the
Closing shall be, fully paid.
4.4 Litigation. To Seller's knowledge, without inquiry, there is not (i)
any material claim, legal action, suit, arbitration, governmental investigation
or other legal or administrative proceeding affecting the delivery of the
Purchased Assets as required hereunder or (ii) order, decree or judgment in
progress, pending or in effect or threatened, affecting the delivery of the
Purchased Assets as required hereunder and Seller does not know or have reason
to know of any basis for the same.
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4.5 Benefit Plans and ERISA. To Seller's knowledge, without inquiry,
Schedule 4.5 sets forth a true and complete list of each "employee benefit plan"
(as defined by Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")), (each such plan, agreement, policy, trust fund or
arrangement is referred to herein as an "Employee Benefit Plan", and
collectively, the "Employee Benefit Plans" that is currently in effect, or which
has been approved before the date hereof but is not yet effective, for the
benefit of employees, and their beneficiaries or any other persons performing
services for Seller in the Business.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
In order to induce Seller to enter into this Agreement and consummate the
transactions contemplated hereby, the Purchaser represents and warrants to
Seller as follows, each of which representations and warranties is material to
and relied upon by Seller:
5.1 Organization of the Purchaser. The Purchaser is a general partnership
duly organized and validly existing under the laws of the State of Delaware and
has the power and authority to own its property and to carry on its business as
now being conducted by it.
5.2 Power and Authority; Due Authorization. The Purchaser has full power
and authority to execute and deliver this Agreement and each of the other
agreements, documents and instruments referenced in this Agreement to which the
Purchaser is or will be a party (the "Purchaser's Transaction Documents") and to
consummate the transactions contemplated hereby and thereby. Prior to the
Closing, the partners of the Purchaser shall have duly approved and authorized
the execution and delivery of this Agreement and each of the Purchaser's
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, and no other proceedings on the part of the Purchaser are
necessary to approve and authorize the execution and delivery of this Agreement
and such Purchaser's Transaction Documents and the consummation of the
transactions contemplated hereby and thereby. Assuming that this Agreement and
each of the Purchaser's Transaction Documents constitutes a valid and binding
agreement of Seller, this Agreement and each of the Purchaser's Transaction
Documents constitutes, or will constitute when executed and delivered, a valid
and binding agreement of the Purchaser, enforceable against the Purchaser in
accordance with its terms, subject to laws of general application in effect
affecting creditors' rights and subject to the exercise of judicial discretion
in accordance with general equitable principles.
ARTICLE 6
CONDITIONS TO OBLIGATIONS OF
THE PURCHASER TO CLOSE
Each and every obligation of the Purchaser under this Agreement to be
performed on or prior to the Closing shall be subject to the fulfillment, on or
prior to the Closing, of each of the following conditions unless and to the
extent any such condition is expressly waived in writing by Purchaser:
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<PAGE> 10
6.1 Representations and Warranties True at Closing. The representations
and warranties made by Seller in or pursuant to this Agreement or given on its
behalf hereunder shall be true and correct in all material respects on and as of
the Closing Date.
6.2 Obligations Performed. Seller shall have performed and complied in all
material respects with all agreements, conditions and obligations required by
this Agreement to be performed or complied with by it prior to or at the
Closing.
6.3 Consents. Seller shall have obtained and delivered to Purchaser
written consents of all persons or entities whose consent is required to
consummate the transactions contemplated herein, if any, and all of such
consents shall remain in full force and effect at and as of the Closing,
including the consents to assignment of the Assumed Leases and to subleasing
under Master Lease I and Master Lease II.
6.4 Closing Deliveries. Seller shall have delivered to Purchaser each of
the following, together with any additional items which Purchaser may reasonably
request to effect the transactions contemplated herein:
(a) possession of the Purchased Assets;
(b) a certified copy of the corporate resolutions of the directors
of Seller authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Transaction Documents by
Seller,
(c) the documents and instruments described in Section 1.3 hereof;
(d) written consents from all persons and entities whose consent to
the transactions contemplated herein is required;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
6.5 Disclosure Schedules. Seller shall have provided Purchaser with
updated Disclosure Schedules dated as of the Closing Date.
6.6 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
6.7 No Changes Prior to Closing. After execution of this Agreement and
prior to the Closing Date, none of the following shall have occurred:
(a) damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, materially and adversely affecting the Business; or
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(b) the legal inability of Seller to convey, assign and transfer to
Purchaser any material portion of the Purchased Assets with the effect of
materially and adversely affecting the ability of Purchaser to utilize the
Purchased Assets in a manner consistent with the operation of the Business.
ARTICLE 7
CONDITIONS TO SELLER'S OBLIGATIONS
Each and every obligation of Seller under this Agreement to be performed
on or prior to the Closing, shall be subject to the fulfillment, on or prior to
the Closing, of each of the following conditions unless and to the extent any
such condition is specifically waived in writing by Seller:
7.1 Representations and Warranties True at Closing. The representations
and warranties made by Purchaser in or pursuant to this Agreement or given on
its behalf hereunder shall be true and correct in all material respects, on and
as of the Closing Date.
7.2 Obligations Performed. The Purchaser shall have performed and complied
in all material respects with all agreements, conditions and obligations
required by this Agreement to be performed or complied with by it prior to or at
the Closing.
7.3 Closing Deliveries. The Purchaser shall have delivered to Seller each
of the following, together with any additional items which Seller may reasonably
request to effect the transactions contemplated herein:
(a) the Purchase Price;
(b) evidence of the authority of the Purchaser to consummate the
transactions contemplated herein and the execution, delivery and
performance of this Agreement and the Purchaser's Transaction Documents by
the Purchaser;
(c) the documents and instruments described in Section 1.3 hereof;
(d) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
7.4 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
ARTICLE 8
MISCELLANEOUS PROVISIONS
8.1 Severability. If any provision of this Agreement is prohibited by the
laws of any jurisdiction as those laws apply to this Agreement, that provision
shall be ineffective to the extent
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of such prohibition and/or shall be modified to conform with such laws, without
invalidating the remaining provisions hereto.
8.2 Modification. This Agreement may not be changed or modified except in
writing specifically referring to this Agreement and signed by each of the
parties hereto.
8.3 Assignment, Survival and Binding Agreement. This Agreement and the
Transaction Documents and the Purchaser's Transaction Documents may not be
assigned by the Seller without the prior written consent of Purchaser. The terms
and conditions hereof shall survive the Closing as provided herein and shall
inure to the benefit of and be binding upon the parties hereto and their
respective heirs, personal representatives, successors and assigns.
8.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.5 Notices. All notices, requests, demands, claims or other
communications hereunder will be in writing and shall be deemed duly given if
personally delivered, sent by a recognized overnight delivery service which
guarantees next day delivery ("Overnight Delivery") or mailed by registered or
certified mail, return receipt requested, postage prepaid and addressed to the
intended recipient as set forth below:
If to Seller: URS Logistics, Inc.
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
with a copy to: Vornado Realty Trust
Park 80 West, Plaza II
Saddle Brook, New Jersey 07663
Attn: ____________________
Telefax: (201) 587-0600
If to the Purchaser: Vornado Crescent Logistics
Operating Partnership
c/o AmeriCold Logistics II, LLC
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
or at such other address as any party hereto notifies the other parties hereof
in writing. The parties hereto agree that notices or other communications that
are sent in accordance herewith (i) by personal delivery, will be deemed
received on the day sent or on the first business day thereafter if not sent on
a business day, (ii) by Overnight Delivery, will be deemed received
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<PAGE> 13
on the first
business day immediately following the date sent, and (iii) by U.S. mail, will
be deemed received three (3) business days immediately following the date sent.
For purposes of this Agreement, a "business day" is a day on which Purchaser is
open for business and shall not include a Saturday or Sunday or legal holiday.
Notwithstanding anything to the contrary in this Agreement, no action shall be
required of the parties hereto except on a business day and in the event an
action is required on a day which is not a business day, such action shall be
required to be performed on the next succeeding day which is a business day.
8.6 Entire Agreement; No Third Party Beneficiaries. This Agreement,
together with the Exhibits and Schedules attached hereto, constitutes the entire
agreement and supersedes any and all other prior agreements and undertakings,
both written and oral, among the parties, or any of them, with respect to the
subject matter hereof and, except as otherwise expressly provided herein, is not
intended to confer upon any person other than Seller and Purchaser, any rights
or remedies hereunder.
8.7 Further Assurances. The parties to this Agreement agree to execute and
deliver, both before and after the Closing, any additional information,
documents or agreements contemplated hereby and/or necessary or appropriate to
effect and consummate the transactions contemplated hereby. Seller agrees to
provide to Purchaser, both before and after the Closing, such information as
Purchaser may reasonably request in order to consummate the transactions
contemplated hereby and to effect an orderly transition of the Business
following Closing.
8.8 Governing Law and Submission to Jurisdiction. Except as otherwise
expressly provided herein, this Agreement shall be governed by and construed
under the laws of the State of Delaware without giving effect to otherwise
applicable principles of conflicts of laws.
8.9 Pronouns. All personal pronouns in this Agreement, whether used in the
masculine, feminine or neuter gender shall include all other genders, and the
singular shall include the plural and the plural shall include the singular.
8.10 Survival of Representations and Warranties. The representations and
warranties set forth in this Agreement shall survive the Closing for a period of
one year and thereafter such representations and warranties shall be null and
void with no further force and effect.
[Signatures on next page]
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<PAGE> 14
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
PURCHASER:
VORNADO CRESCENT LOGISTICS
OPERATING PARTNERSHIP
By: Vornado Operating, L.P.
Its: General Partner
By: Vornado Operating Company
Its: General Partner
By: /s/ Irwin Goldberg
--------------------------------
Irwin Goldberg
Vice President and CFO
SELLER:
URS LOGISTICS, INC.
By: /s/ Daniel F. McNamara
--------------------------------
Name: Daniel F. McNamara
Its: President
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<PAGE> 15
LIST OF SCHEDULES AND EXHIBITS
Schedule 1.1(a) Fixed Assets
Schedule 1.1(b) Contracts
Schedule 1.1(c) Assumed Leases
Schedule 1.1(e) Intellectual Property
Schedule 3.4 Purchase Price Allocation
Schedule 4.5 Employee Benefit Plans
Exhibit 1.3(a) Bill of Sale
Exhibit 1.3(b) Assignment of Contracts
Exhibit 1.3(c) Assignment of Master Lease I
Exhibit 1.3(d) Assignment of Customer Leases
Exhibit 1.3(e) Assignment of Equipment Leases
Exhibit 1.3(f) Assignment of Office Lease
Exhibit 1.3(g) Master Lease II
Exhibit 1.3(h) Assignment of AmeriCold Logistics, LLC
<PAGE> 1
Exhibit 2.3
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made as of the 9th day
of March, 1999, by and between AMERICOLD LOGISTICS, LLC, a Delaware limited
liability company ("Purchaser"), and VC OMAHA HOLDINGS, L.L.C., a Delaware
limited liability company ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business of providing refrigerated, frozen and
dry warehouse storage services, logistics, distribution and transportation
services and other services (the "Business") on a contract basis for its
customers; and
WHEREAS, VC Omaha Real Estate Holdings, L.L.C., a Delaware limited
liability company ("VC Omaha Real Estate Holdings"), Carmar
Freezers-Thomasville, L.L.C., a Missouri limited liability company ("Carmar
Thomasville") VC Omaha Texas, L.L.C., a Delaware limited liability company ("VC
Omaha Texas"), VC Superior, L.L.C., a Delaware limited liability company ("VC
Superior"), Carmar Group, Inc., a Missouri corporation ("Carmar Group") and VC
Texas, L.P., a Delaware limited partnership ("VC Texas") are wholly owned
subsidiaries of Seller; and
WHEREAS, Seller owns 50% of the membership interests of Distributions
Development, L.L.C., a South Dakota limited liability company ("Distributions
Development")
WHEREAS, VC Freezer Russelville, L.L.C., Delaware limited liability
company ,VC Freezer Springdale, L.L.C., a Delaware limited liability company,
Carmar Freezers-Russelville, L.L.C., a Missouri limited liability company,
Freezer Services Kentucky, Inc., a ___________ corporation, VC Fremont, L.L.C.,
a Delaware limited liability company, VC Garden City, L.L.C., Delaware limited
liability company, VC Freezer Sioux Falls, L.L.C., a Delaware limited liability
company, VC Omaha Amarillo, L.L.C., a Delaware limited liability company, VC
Freezer Texarkana, L.L.C., a Delaware limited liability company, VC Freezer Fort
Worth, L.L.C., a Delaware limited liability company and VC Amarillo, L.P., a
Delaware limited partnership are wholly owned subsidiaries of Holdings
(collectively, the "Holdings Subsidiaries", collectively VC Omaha Real Estate
Holdings, Carmar Thomasville, Carmar Group and the Holdings Subsidiaries, the
"Subsidiaries"); and
WHEREAS, portions of the Business are owned and operated by the
Subsidiaries; and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, substantially all of the assets of Seller and the
Subsidiaries used or held for use in the Business except for the Excluded Assets
(as hereinafter defined) pursuant to the terms of this Agreement; and
<PAGE> 2
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the transactions contemplated herein and certain additional
agreements related thereto.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF PURCHASED ASSETS
1.1 Assets to be Acquired. Subject to and upon the terms and conditions
set forth herein, Purchaser hereby agrees to purchase from Seller, and Seller
hereby agrees to sell, transfer and assign and cause the Subsidiaries to sell,
transfer and assign to Purchaser all of the tangible and intangible assets of
Seller (but excluding the Excluded Assets) used or held for use in connection
with the Business, including, without limitation, the following (collectively,
the "Purchased Assets"):
(a) all of Seller's and the Subsidiaries' vehicles and equipment
(excluding refrigeration equipment which is part of the real estate) used or
held for use by Seller in connection with the Business as of the Closing (as
hereinafter defined), including, but not limited to, tools, fork lifts, racks,
supplies, computers and computer equipment, furniture and fixtures and those
items listed on Schedule 1.1(a) attached hereto (the "Fixed Assets"); and
(b) all of Seller's and the Subsidiaries' right, title and interest
in, to and under all written or oral contracts, license agreements and all other
agreements, commitments and other instruments to which the Purchased Assets are
subject or bound or that otherwise pertain to the Business including without
limitation the agreements set forth in Schedule 1.1(b) attached hereto
(collectively, the "Contracts"); and
(c) all of Seller's and the Subsidiaries' interest in, and rights
and benefits accruing to Seller under, those certain leases to which Seller is a
party and which pertain to the Business as identified on Schedule 1.1(c)
attached hereto (collectively, the "Assumed Leases"); and
(d) all of Seller's interest and/or partnership interests in and to
VC Omaha Texas, VC Superior and VC Texas, and all of Seller's membership
interest in and to Distributions Development; and
(e) all rights and interests of Seller and the Subsidiaries in any
trademarks, service marks, copyrights, logos, patents, inventions, processes,
franchises, registrations, license agreements, trade secrets, customer lists,
trade lists and trade or service names used in the Business, including without
limitation those marks and names listed on Schedule 1.1(e) attached hereto
(collectively, the "Intellectual Property"); and
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(f) all of Seller's and the Subsidiaries' licenses, consents,
permits, variances, certifications and approvals of governmental agencies used
or held for use in connection with the Business, to the extent assignable; and
(g) all of Seller's and the Subsidiaries' right, title and interest
in and to its telephone numbers and the directory advertising for such telephone
numbers for each of its facilities and offices, to the extent assignable; and
(h) all of Seller's and the Subsidiaries' right, title and interest
in and to its books and records related to the Business and the Purchased
Assets; and
(i) all of Seller's and the Subsidiaries' right, title and interest
in and to its computer software and licenses therefor and any proprietary
technology and processes; and
(j) all of Seller's and the Subsidiaries' right, title and interest
in and to any voting securities of any corporation or other entity; and
(k) all of Seller's and the Subsidiaries' right, title and interest
in and to all of the cash, accounts receivable, other rights to receive payment
from customers of the Business and all other current assets relating to the
Business; and
(l) all of Seller's and the Subsidiaries' right, title and interest
in and to all other tangible and intangible personal property used or held for
use in connection with the Business.
1.2 Excluded Assets. Notwithstanding anything to the contrary contained in
Section 1.1 hereof, the Purchased Assets shall not in any event include any real
estate assets of Seller including, without limitation, land, buildings and other
improvements thereon, including, without limitation, warehouse refrigeration
equipment (other than the interests being assigned that are covered by the
Assumed Leases and the leasehold interests being conveyed by the Master Leases).
1.3 Conveyance of Assets. The conveyance, transfer and delivery of the
Purchased Assets shall be made by Seller and accepted by Purchaser as of the
Closing Date (as hereafter defined) as follows:
(a) Seller shall execute and deliver to Purchaser a blanket bill of
sale of tangible personal property and general assignment of intangible personal
property in the form of Exhibit 1.3(a) attached hereto and made a part hereof
(the "Bill of Sale");
(b) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Contracts in the form of Exhibit 1.3(b) attached hereto and made a
part hereof (the "Assignment of Contracts");
(c) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Customer Leases in the form of Exhibit 1.3(c) attached hereto and
made a part hereof (the "Assignment of Customer Leases");
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(d) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Equipment Leases in the form of Exhibit 1.3(d) attached hereto and
made a part hereof (the "Assignment of Equipment Leases");
(e) Seller and Purchaser shall execute and deliver two Master Leases
Agreements in the form of Exhibit 1.3(e) attached hereto and made a part hereof
("Master Leases"); and
(f) Seller shall execute and deliver such additional instruments of
sale, transfer, conveyance and assignment as of the Closing Date as counsel to
Purchaser shall reasonably deem necessary or appropriate to transfer the
Purchased Assets to Purchaser.
1.4 Assumption of Liabilities. Purchaser agrees to assume, from and after
the Closing Date, (i) all duties and obligations of Seller under the Contracts,
(ii) all duties and obligations of Seller under the Assumed Leases, and (iii)
all of the accounts payable and other current liabilities of Seller (other than
current debt service on any loans) with respect to the Business and the
Purchased Assets; provided, however, that Purchaser shall not assume any of the
Seller Transaction Expenses, as defined and provided in Section 3.6 hereof.
1.5 Closing. The closing of the transaction contemplated herein (the
"Closing") shall occur no later than March 15, 1999 (such date to be herein
referred to as the "Closing Date") and shall take place at the offices of Arnall
Golden & Gregory, LLP or by the exchange of documents and instruments by mail,
courier, telecopy and wire transfer to the extent mutually acceptable to the
parties hereto upon compliance with the terms, conditions and contingencies
contained herein. All computations, adjustments, and transfers for the purposes
hereof shall be effective as 11:59 p.m. on the Closing Date.
ARTICLE 2
PURCHASE PRICE; ESTIMATED CLOSING AMOUNT AND
PURCHASE PRICE ADJUSTMENTS
2.1 Purchase Price. The purchase price to be paid to Seller at Closing for
the Purchased Assets ("Purchase Price") shall be $2,130,367 and shall be payable
in cash or other immediately available funds at Closing.
2.2 Adjustment to Purchase Price for Working Capital. The Purchase Price
is based upon the presumption that the Net Working Capital (as hereinafter
defined) of the Business as of the Closing Date is $345,800 ("Projected Net
Working Capital"). In the event the actual Net Working Capital of the Business
as of the Closing Date ("Closing Net Working Capital") is determined to be less
than or greater than Projected Net Working Capital, the Purchase Price shall be
adjusted in the following manner: Within thirty (30) days following the Closing
Date, the actual Net Working Capital as the Closing Date shall be determined by
Seller and such determination shall be subject to reasonable review and
confirmation by Purchaser. The Purchase Price shall be increased by the amount
that Closing Net Working Capital exceeds Projected Net Working Capital. The
Purchase Price shall be reduced by the amount that Projected Net Working Capital
exceeds Closing Net Working Capital. Any adjustment to the Purchase Price
pursuant to this Section 2.2
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shall be due and payable by the applicable party within ten (10) days following
determination of the Closing Net Working Capital. For purposes of this
Agreement, "Net Working Capital" shall mean the current assets of Seller with
respect to the Business and the Purchased Assets minus the current liabilities
of Seller with respect to the Business and the Purchased Assets (other than
current debt service on any loans) as determined in accordance with generally
accepted accounting principles.
2.3 Adjustment to Purchase Price for Certain Capital Expenditures. The
Purchase Price is based upon the presumption that Purchaser will incur capital
expenditures for the Business in the amount of at least $620,109 ("Projected
Capital Expenditures") during the period from the Closing Date until the last
day of the twelfth calendar month following the month in which the Closing
occurs ("Capital Expenditure Period"). In the event the actual amount of capital
expenditures for the Business during the Capital Expenditure Period ("Actual
Capital Expenditures") is less than the Projected Capital Expenditures, the
Purchase Price shall be increased by the difference between the Projected
Capital Expenditures and the Actual Capital Expenditures. Within sixty (60) days
following the end of the Capital Expenditure Period, Purchaser shall deliver to
Seller written documentation evidencing, to Seller's reasonable satisfaction,
the Actual Capital Expenditures by Purchaser during the Capital Expenditure
Period. Any adjustment to the Purchase Price pursuant to this Section 2.3 shall
be due and payable by Purchaser within ninety (90) days following the end of the
Capital Expenditure Period.
ARTICLE 3
ADDITIONAL COVENANTS
3.1 Due Diligence. Prior to the Closing Date, Seller shall have delivered
to Purchaser all schedules (the "Disclosure Schedules") containing information
regarding the Seller required to be attached hereto. The Disclosure Schedules
shall be deemed for all purposes of this Agreement to constitute an integral
part of this Agreement and the representations and warranties of the Seller
contained therein. The parties hereto acknowledge and agree that the information
in the Disclosure Schedules are provided based upon the knowledge of Seller,
without any inquiry, and no representations or warranties whatsoever are hereby
made with respect to the completeness or accuracy of the Disclosure Schedules.
3.2 Employment Matters. Purchaser shall have the right to hire any and all
of the employees of the Business as of the Closing Date. From and after the date
of this Agreement, Seller shall assist Purchaser with transferring the employees
of the Business to Purchaser so that the process is completed on the Closing
Date. Seller shall be responsible for providing all notices and other
communications to employees of Seller which may be required under the Worker
Adjustment and Retraining Act (the "WARN Act") or any other applicable statute,
law or regulation in connection with the transaction contemplated hereby. Seller
shall terminate all of its employees employed by the Business whom Purchaser
shall hire effective as of the Closing Date. Seller shall pay all obligations,
imposed by law or otherwise, to such employees for all periods through the
Closing Date, including, without limitation, obligations for payroll, vacation
time, sick time and other obligations in connection with such employees. Seller
shall assist Purchaser in continuing the Employee Benefit Plans. Purchaser shall
assume all the obligations and liabilities whatsoever in respect of severance,
accrued vacation or sick leave, WARN Act, income tax withholding, payroll and/or
unemployment tax, workers' compensation, pension, profit-sharing, health
insurance, FMLA
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(as hereinafter defined), COBRA (as hereinafter defined) or any other employee
or other benefit liabilities in respect of any employees in the Business or in
respect of any Employee Benefit Plans (as hereinafter defined), including,
without limitation any contribution, tax, lien, penalty, cost, interest, claim,
loss, action, suit, damage, cost assessment, withdrawal liability, liability to
the Pension Benefit Guaranty Corporation (the "PBGC"), liability under Section
412 of the Internal Revenue Code of 1986, as amended (the "Code") or Section
302(a)(2) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or other similar liability or expense of Seller.
3.3 Consents. Prior to the Closing, Seller shall deliver to Purchaser
copies of all correspondence to and from landlords and tenants of the Assumed
Leases and the landlords of the subleased facilities pursuant to the Master
Leases. In addition, prior to the Closing Date, Seller shall deliver to
Purchaser consents from the landlords and/or tenants as applicable of the
Assumed Leases and the landlords of the subleased facilities pursuant to the
Master Leases. Purchaser agrees to cooperate with Seller, upon Seller's request,
in Seller's effort to obtain the required consents. Any charges imposed by the
landlords or other parties for such consents shall be borne by Seller.
3.4 Allocation of Purchase Price Among Purchased Assets. The Purchase
Price shall be allocated for tax purposes among each item or class of Purchased
Assets as mutually agreed to by Purchaser and Seller and set forth on Schedule
3.4 attached hereto. Seller and Purchaser agree that they will prepare and file
any notice or other filing required pursuant to Section 1060 of the Code, and
that any such notices or filings will be prepared based upon such tax allocation
of the Purchase Price. Purchaser agrees to send to Seller a completed copy of
its Form 8594 ("Asset Acquisition Statement under Section 1060") with respect to
this transaction prior to filing such form with the Internal Revenue Service.
3.5 Tax Matters.
(a) As used in this Agreement, the following terms have the
specified meanings:
(i) "Tax Authority" shall mean any United States federal,
foreign, national, state, county or municipal or other local government, any
subdivision, agency, commission or authority thereof, or any quasi-governmental
body exercising any taxing authority or any other authority exercising tax
regulatory authority.
(ii) "Tax Return" shall mean any return, amended return,
estimated return, information return and statement (including any related or
supporting information) filed or to be filed with any Tax Authority in
connection with the determination, assessment, collection or administration of
any Tax.
(iii) "Tax(es)" shall mean all taxes, charges, fees, interest,
fines, penalties, additions to tax or other assessments, including without
limitation, income, excise, environmental, property, sales, gross receipts,
gains, transfer, occupation, privilege, employment (including social security
and unemployment), use, value added, capital stock or surplus, franchise taxes,
advance corporate tax and customs duties imposed by any Tax Authority, payable
by Seller or relating to or chargeable against Seller's assets, revenues or
income.
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(b) Subject to Section 3.5(c) hereof, Seller shall be solely
responsible for and shall pay, without any cost to the Purchaser (i) any and all
Taxes for which Seller is or may be liable, arising from Seller's activities,
the Business or use of the Purchased Assets prior to Closing (regardless of
whether the filing of any Tax Return with respect thereto or payment of any
amount in respect thereof is filed, paid or due prior to, on or after the
Closing Date), (ii) any Taxes with respect to the acquisition by Purchaser from
Seller of the Purchased Assets, and all other Taxes, if any, imposed by any Tax
Authority assessed in connection with, on account of or resulting from the
consummation of the transfer of the Purchased Assets to the Purchaser.
(c) Real and personal property ad valorem Taxes, if any, with
respect to the Purchased Assets shall be prorated between Seller on the one
hand, and the Purchaser on the other hand, as of the Closing Date. Should any
amount of such Taxes to be prorated not be fully determined as of the Closing
Date, a mutually satisfactory estimate of such amount, made on the basis of
Seller's records, shall be used as the basis for settlement at Closing, and the
amount finally determined will be prorated and appropriate settlement
adjustments made as soon as practicable after such final determination.
(d) Except as otherwise provided in this Agreement, the parties
hereby agree that each of them shall cooperate with the other in executing or
causing to be executed any required document and by making available to the
other all work papers, records and notes of any kind at all reasonable times for
the purpose of allowing the appropriate party to complete Tax Returns,
participate in a proceeding, obtain refunds, make any determination required
under this Agreement or defend or prosecute Tax claims. Notwithstanding anything
to the contrary contained herein, Seller shall have sole and exclusive
responsibility and authority to prepare and file all Tax Returns concerning
Seller related activities occurring prior to the Closing, including, without
limitation, its operation of the Business and its use of the Purchased Assets
and all matters under agreements whether or not being assumed by Purchaser
(regardless of when such return is filed). Purchaser shall be given copies of
any such return related to the Business filed by Seller.
3.6 Transaction Expenses. All of the expenses incurred by Purchaser in
connection with the authorization, negotiation, preparation, execution and
performance of this Agreement and other agreements referred to herein and the
consummation of the transactions contemplated hereby, including, without
limitation, all fees and expenses of agents, representatives, brokers, counsel
and accountants for Purchaser, shall be paid by Purchaser ("Purchaser
Transaction Expenses"). All expenses incurred by the Seller in connection with
the authorization, negotiation, preparation, execution and performance of this
Agreement and the other agreements referred to herein and the consummation of
the transactions contemplated hereby, including without limitation, all fees and
expenses of agents, representatives, brokers, counsel and accountants, shall be
paid by the Seller ("Seller Transaction Expenses").
3.7 Access to Books and Records. After the Closing, Purchaser shall
preserve all of the records and books pertaining to the Business and the
Purchased Assets relating to the period prior to Closing until the later of (a)
the longest time period prescribed by any relevant Tax Authority for the
retention of supporting documentation for Tax Returns for periods beginning
prior to the Closing date, and regardless of whether such periods end before or
after the Closing Date or (b) the seventh anniversary of the Closing Date, and,
until such time, make them available, during
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normal business hours, to Seller and its designees, counsel, accountants, and
others authorized by them for inspection and the making of copies thereof.
3.8 Operation in Ordinary Course. Seller shall operate the Business in the
ordinary course through the Closing Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
In order to induce the Purchaser to enter into this Agreement and
consummate the transactions contemplated hereby, Seller represents and warrants
to the Purchaser as follows, each of which warranties and representations is
material to and relied upon by the Purchaser.
4.1 Organization and Authority of Seller. Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware. Seller has all necessary corporate power and authority to
own, lease and operate its properties and conduct its business as it is
currently being conducted.
4.2 Corporate Power and Authority; Due Authorization. Seller has full
corporate power and authority to execute and deliver this Agreement and each of
the Transaction Documents to which Seller is or will be a party and to
consummate the transactions contemplated hereby. "Transaction Documents" means
each of the agreements, documents and instruments referenced in this Agreement
to be executed and delivered by Seller. Prior to the Closing, the directors and
the stockholders of Seller shall have duly approved and authorized the execution
and delivery of this Agreement and each of the Transaction Documents to which
Seller is or will be a party and the consummation of the transactions
contemplated hereby and thereby, and no other corporate proceedings shall then
be necessary. Assuming that this Agreement and each of the Transaction Documents
to which Purchaser is a party constitutes a valid and binding agreement of the
Purchaser, this Agreement and each of the Transaction Documents constitutes, or
will constitute when executed and delivered, a valid and binding agreement of
Seller, in each case enforceable in accordance with its terms, subject to laws
of general application in effect affecting creditors' rights and subject to the
exercise of judicial discretion in accordance with general equitable principles.
4.3 Tax Returns and Payments. Seller has correctly and timely filed all
Tax Returns required by law to be filed on or before the date of this Agreement
and shall correctly and timely file all Tax Returns required by law to be filed
on or prior to the Closing Date. All such Tax Returns are true, correct and
complete in all respects, and all amounts shown as owing thereon have been paid.
No penalties, interest or other charges are or will be due with respect to the
late filing of any such Tax Returns. Seller has made all estimated Tax payments
required to be made under the Code. Taxes for all Tax periods (or portions
thereof) ending prior to or on the Closing Date have been, or prior to the
Closing shall be, fully paid.
4.4 Litigation. To the Seller's knowledge, without inquiry, there is not
(i) any material claim, legal action, suit, arbitration, governmental
investigation or other legal or administrative proceeding affecting the delivery
of the Purchased Assets as required hereunder or (ii) order, decree or judgment
in progress, pending or in effect or threatened, affecting the delivery of the
Purchased
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Assets as required hereunder and Seller does not know or have reason to know of
any basis for the same.
4.5 Benefit Plans and ERISA. To the Seller's knowledge, without inquiry,
Schedule 4.5 sets forth a true and complete list of each "employee benefit plan"
(as defined by Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")), (each such plan, agreement, policy, trust fund or
arrangement is referred to herein as an "Employee Benefit Plan", and
collectively, the "Employee Benefit Plans") that is currently in effect, or
which has been approved before the date hereof but is not yet effective, for the
benefit of employees, and their beneficiaries or any other persons performing
services for Seller in the Business.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
In order to induce Seller to enter into this Agreement and consummate the
transactions contemplated hereby, the Purchaser represents and warrants to
Seller as follows, each of which representations and warranties is material to
and relied upon by Seller:
5.1 Organization of the Purchaser. The Purchaser is a limited liability
company duly organized and validly existing under the laws of the State of
Delaware and has the power and authority to own its property and to carry on its
business as now being conducted by it.
5.2 Power and Authority; Due Authorization. The Purchaser has full power
and authority to execute and deliver this Agreement and each of the other
agreements, documents and instruments referenced in this Agreement to which the
Purchaser is or will be a party (the "Purchaser's Transaction Documents") and to
consummate the transactions contemplated hereby and thereby. Prior to the
Closing, the Manager of the Purchaser shall have duly approved and authorized
the execution and delivery of this Agreement and each of the Purchaser's
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, and no other proceedings on the part of the Purchaser are
necessary to approve and authorize the execution and delivery of this Agreement
and such Purchaser's Transaction Documents and the consummation of the
transactions contemplated hereby and thereby. Assuming that this Agreement and
each of the Purchaser's Transaction Documents constitutes a valid and binding
agreement of Seller, this Agreement and each of the Purchaser's Transaction
Documents constitutes, or will constitute when executed and delivered, a valid
and binding agreement of the Purchaser, enforceable against the Purchaser in
accordance with its terms, subject to laws of general application in effect
affecting creditors' rights and subject to the exercise of judicial discretion
in accordance with general equitable principles.
ARTICLE 6
CONDITIONS TO OBLIGATIONS OF
THE PURCHASER TO CLOSE
Each and every obligation of the Purchaser under this Agreement to be
performed on or prior to the Closing shall be subject to the fulfillment, on or
prior to the Closing, of each of the
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following conditions unless and to the extent any such condition is expressly
waived in writing by Purchaser:
6.1 Representations and Warranties True at Closing. The representations
and warranties made by Seller in or pursuant to this Agreement or given on its
behalf hereunder shall be true and correct in all material respects on and as of
the Closing Date.
6.2 Obligations Performed. Seller shall have performed and complied in all
material respects with all agreements, conditions and obligations required by
this Agreement to be performed or complied with by it prior to or at the
Closing.
6.3 Consents. Seller shall have obtained and delivered to Purchaser
written consents of all persons or entities whose consent is required to
consummate the transactions contemplated herein, if any, and all of such
consents shall remain in full force and effect at and as of the Closing,
including the consents to assignment of the Assumed Leases and to subleasing
under the Master Leases.
6.4 Closing Deliveries. Seller shall have delivered to Purchaser each of
the following, together with any additional items which Purchaser may reasonably
request to effect the transactions contemplated herein:
(a) possession of the Purchased Assets;
(b) a certified copy of the corporate resolutions of the directors
of Seller authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Transaction Documents by
Seller,
(c) the documents and instruments described in Section 1.3 hereof;
(d) written consents from all persons and entities whose consent to
the transactions contemplated herein is required;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
6.5 Disclosure Schedules. Seller shall have provided Purchaser with
updated Disclosure Schedules dated as of the Closing Date.
6.6 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
6.7 No Changes Prior to Closing. After execution of this Agreement and
prior to the Closing Date, none of the following shall have occurred:
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(a) damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, materially and adversely affecting the Business; or
(b) the legal inability of Seller to convey, assign and transfer to
Purchaser any material portion of the Purchased Assets with the effect of
materially and adversely affecting the ability of Purchaser to utilize the
Purchased Assets in a manner consistent with the operation of the Business.
ARTICLE 7
CONDITIONS TO SELLER'S OBLIGATIONS
Each and every obligation of Seller under this Agreement to be performed
on or prior to the Closing, shall be subject to the fulfillment, on or prior to
the Closing, of each of the following conditions unless and to the extent any
such condition is specifically waived in writing by Seller:
7.1 Representations and Warranties True at Closing. The representations
and warranties made by Purchaser in or pursuant to this Agreement or given on
its behalf hereunder shall be true and correct in all material respects, on and
as of the Closing Date.
7.2 Obligations Performed. The Purchaser shall have performed and complied
in all material respects with all agreements, conditions and obligations
required by this Agreement to be performed or complied with by it prior to or at
the Closing.
7.3 Closing Deliveries. The Purchaser shall have delivered to Seller each
of the following, together with any additional items which Seller may reasonably
request to effect the transactions contemplated herein:
(a) the Purchase Price;
(b) evidence of authority of the Manager of the Purchaser
authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Purchaser's Transaction
Documents by the Purchaser;
(d) the documents and instruments described in Section 1.3 hereof;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
7.4 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
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ARTICLE 8
MISCELLANEOUS PROVISIONS
8.1 Severability. If any provision of this Agreement is prohibited by the
laws of any jurisdiction as those laws apply to this Agreement, that provision
shall be ineffective to the extent of such prohibition and/or shall be modified
to conform with such laws, without invalidating the remaining provisions hereto.
8.2 Modification. This Agreement may not be changed or modified except in
writing specifically referring to this Agreement and signed by each of the
parties hereto.
8.3 Assignment, Survival and Binding Agreement. This Agreement and the
Transaction Documents and the Purchaser's Transaction Documents may not be
assigned by the Seller without the prior written consent of Purchaser. The terms
and conditions hereof shall survive the Closing as provided herein and shall
inure to the benefit of and be binding upon the parties hereto and their
respective heirs, personal representatives, successors and assigns.
8.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.5 Notices. All notices, requests, demands, claims or other
communications hereunder will be in writing and shall be deemed duly given if
personally delivered, sent by a recognized overnight delivery service which
guarantees next day delivery ("Overnight Delivery") or mailed by registered or
certified mail, return receipt requested, postage prepaid and addressed to the
intended recipient as set forth below:
If to Seller: VC Omaha Holdings, L.L.C.
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
If to the Purchaser: AmeriCold Logistics, LLC
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
or at such other address as any party hereto notifies the other parties hereof
in writing. The parties hereto agree that notices or other communications that
are sent in accordance herewith (i) by personal delivery, will be deemed
received on the day sent or on the first business day thereafter if not sent on
a business day, (ii) by Overnight Delivery, will be deemed received on the first
business day immediately following the date sent, and (iii) by U.S. mail, will
be deemed received three (3) business days immediately following the date sent.
For purposes of this Agreement, a "business day" is a day on which Purchaser is
open for business and shall not include a Saturday or
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Sunday or legal holiday. Notwithstanding anything to the contrary in this
Agreement, no action shall be required of the parties hereto except on a
business day and in the event an action is required on a day which is not a
business day, such action shall be required to be performed on the next
succeeding day which is a business day.
8.6 Entire Agreement; No Third Party Beneficiaries. This Agreement,
together with the Exhibits and Schedules attached hereto, constitutes the entire
agreement and supersedes any and all other prior agreements and undertakings,
both written and oral, among the parties, or any of them, with respect to the
subject matter hereof and, except as otherwise expressly provided herein, is not
intended to confer upon any person other than Seller and Purchaser, any rights
or remedies hereunder.
8.7 Further Assurances. The parties to this Agreement agree to execute and
deliver, both before and after the Closing, any additional information,
documents or agreements contemplated hereby and/or necessary or appropriate to
effect and consummate the transactions contemplated hereby. Seller agrees to
provide to Purchaser, both before and after the Closing, such information as
Purchaser may reasonably request in order to consummate the transactions
contemplated hereby and to effect an orderly transition of the Business
following Closing.
8.8 Governing Law and Submission to Jurisdiction. Except as otherwise
expressly provided herein, this Agreement shall be governed by and construed
under the laws of the State of Delaware without giving effect to otherwise
applicable principles of conflicts of laws.
8.9 Pronouns. All personal pronouns in this Agreement, whether used in the
masculine, feminine or neuter gender shall include all other genders, and the
singular shall include the plural and the plural shall include the singular.
8.10 Survival of Representations and Warranties. The representations and
warranties set forth in this Agreement shall survive the Closing for a period of
one year and thereafter such representations and warranties shall be null and
void with no further force and effect.
[Signatures on next page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
PURCHASER:
AMERICOLD LOGISTICS, LLC
By: /s/ Frederick B. Beilstein III
------------------------------------
Name: Frederick B. Beilstein III
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Its: Senior Vice President
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SELLER:
VC OMAHA HOLDINGS, L.L.C.
By: /s/ Daniel F. McNamara
------------------------------------
Name: Daniel F. McNamara
----------------------------------
Its: President
-----------------------------------
<PAGE> 15
LIST OF SCHEDULES AND EXHIBITS
Schedule 1.1(a) Fixed Assets
Schedule 1.1(b) Contracts
Schedule 1.1(c) Assumed Leases
Schedule 1.1(e) Intellectual Property
Schedule 3.4 Purchase Price Allocation
Schedule 4.5 Employee Benefit Plans
Exhibit 1.3(a) Bill of Sale
Exhibit 1.3(b) Assignment of Contracts
Exhibit 1.3(c) Assignment of Customer Leases
Exhibit 1.3(d) Assignment of Equipment Leases
Exhibit 1.3(e) Master Leases
<PAGE> 1
Exhibit 2.4
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made as of the 9th day
of March, 1999, by and between AMERICOLD LOGISTICS II, LLC, a Delaware limited
liability company ("Purchaser"), and VC MISSOURI HOLDINGS, L.L.C., a Delaware
limited liability company ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business of providing refrigerated, frozen and
dry warehouse storage services, logistics, distribution and transportation
services, mining operations and other services (the "Business"); and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, substantially all of the assets of Seller used or held for
use in the Business except for the Excluded Assets (as hereinafter defined)
pursuant to the terms of this Agreement; and
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the transactions contemplated herein and certain additional
agreements related thereto.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF PURCHASED ASSETS
1.1 Assets to be Acquired. Subject to and upon the terms and conditions
set forth herein, Purchaser hereby agrees to purchase from Seller, and Seller
hereby agrees to sell, transfer and assign to Purchaser all of the tangible and
intangible assets of Seller (but excluding the Excluded Assets) used or held for
use in connection with the Business, including, without limitation, the
following (collectively, the "Purchased Assets"):
(a) all of Seller's vehicles and equipment (excluding refrigeration
equipment which is part of the real estate) used or held for use by Seller in
connection with the Business as of the Closing (as hereinafter defined),
including, but not limited to, tools, fork lifts, racks, supplies, computers and
computer equipment, furniture and fixtures; and
(b) all of Seller's right, title and interest in, to and under all
written or oral contracts, license agreements and all other agreements,
commitments and other instruments to which the Purchased Assets are subject or
bound or that otherwise pertain to the Business including without limitation the
agreements set forth in Schedule 1.1(b) attached hereto (collectively, the
"Contracts"); and
<PAGE> 2
(c) all of Seller's interest in, and rights and benefits accruing to
Seller under, those certain leases to which Seller is a party and which pertain
to the Business as identified on Schedule 1.1(c) attached hereto (collectively,
the "Assumed Leases"); and
(d) all of Seller's membership interest in and to VC Logistics,
L.L.C., a Delaware limited liability company ("VC Logistics"); all of Seller's
membership interest in and to Carmar Industries, L.L.C., a Delaware limited
liability company ("Carmar Industries"); and all of Seller's membership interest
in and to VC Carthage, L.L.C., a Delaware limited liability company ("VC
Carthage"), all of which are wholly owned by Seller; and
(e) all rights and interests of Seller in any trademarks, service
marks, copyrights, logos, patents, inventions, processes, franchises,
registrations, license agreements, trade secrets, customer lists, trade lists
and trade or service names used in the Business, including without limitation
those marks and names listed on Schedule 1.1(e) attached hereto (collectively,
the "Intellectual Property"); and
(f) all of Seller's licenses, consents, permits, variances,
certifications and approvals of governmental agencies used or held for use in
connection with the Business, to the extent assignable; and
(g) all of Seller's right, title and interest in and to its
telephone numbers and the directory advertising for such telephone numbers for
each of its facilities and offices, to the extent assignable; and
(h) all of Seller's right, title and interest in and to its books
and records related to the Business and the Purchased Assets; and
(i) all of Seller's right, title and interest in and to its computer
software and licenses therefor and any proprietary technology and processes; and
(j) all of Seller's right, title and interest in and to any voting
securities of any corporation or other entity, except for the shares of Carmar
Group, Inc.; and
(k) all of Seller's right, title and interest in and to all of the
cash, accounts receivable, other rights to receive payment from customers of the
Business and all other current assets relating to the Business; and
(l) all of Seller's right, title and interest in and to all other
tangible and intangible personal property used or held for use in connection
with the Business.
1.2 Excluded Assets. Notwithstanding anything to the contrary contained in
Section 1.1 hereof, the Purchased Assets shall not in any event include any real
estate assets of Seller including, without limitation, land, buildings and other
improvements thereon, including, without limitation, warehouse refrigeration
equipment (other than the interests being assigned that are
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covered by the Assumed Leases and the leasehold interests being conveyed by the
Master Lease and any real estate owned by VC Logistics, VC Carthage and Carmar
Industries).
1.3 Conveyance of Assets. The conveyance, transfer and delivery of the
Purchased Assets shall be made by Seller and accepted by Purchaser as of the
Closing Date (as hereafter defined) as follows:
(a) Seller shall execute and deliver to Purchaser a blanket bill of
sale of tangible personal property and general assignment of intangible personal
property in the form of Exhibit 1.3(a) attached hereto and made a part hereof
(the "Bill of Sale");
(b) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Contracts in the form of Exhibit 1.3(b) attached hereto and made a
part hereof (the "Assignment of Contracts");
(c) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Customer Leases in the form of Exhibit 1.3(c) attached hereto and
made a part hereof (the "Assignment of Customer Leases");
(d) Seller and Purchaser shall execute and deliver an Assignment and
Assumption of Equipment Leases in the form of Exhibit 1.3(d) attached hereto and
made a part hereof (the "Assignment of Equipment Leases");
(e) Seller and Purchaser shall execute and deliver a Master Lease
Agreement in the form of Exhibit 1.3(e) attached hereto and made a part hereof
("Master Lease"); and
(f) Seller shall execute and deliver such additional instruments of
sale, transfer, conveyance and assignment as of the Closing Date as counsel to
Purchaser shall reasonably deem necessary or appropriate to transfer the
Purchased Assets to Purchaser.
1.4 Assumption of Liabilities. Purchaser agrees to assume, from and after
the Closing Date, (i) all duties and obligations of Seller under the Contracts,
(ii) all duties and obligations of Seller under the Assumed Leases, and (iii)
all of the accounts payable and other current liabilities of Seller (other than
current debt service on any loans) with respect to the Business and the
Purchased Assets; provided, however, that Purchaser shall not assume any of the
Seller Transaction Expenses, as defined and provided in Section 3.6 hereof.
1.5 Closing. The closing of the transaction contemplated herein (the
"Closing") shall occur no later than March 15, 1999 (such date to be herein
referred to as the "Closing Date") and shall take place at the offices of Arnall
Golden & Gregory, LLP or by the exchange of documents and instruments by mail,
courier, telecopy and wire transfer to the extent mutually acceptable to the
parties hereto upon compliance with the terms, conditions and contingencies
contained herein. All computations, adjustments, and transfers for the purposes
hereof shall be effective as 11:59 p.m. on the Closing Date.
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<PAGE> 4
ARTICLE 2
PURCHASE PRICE; ESTIMATED CLOSING AMOUNT AND
PURCHASE PRICE ADJUSTMENTS
2.1 Purchase Price. The purchase price to be paid to Seller at Closing for
the Purchased Assets ("Purchase Price") shall be $18,754,467 and shall be
payable in cash or other immediately available funds at Closing.
2.2 Adjustment to Purchase Price for Working Capital. The Purchase Price
is based upon the presumption that the Net Working Capital (as hereinafter
defined) of the Business as of the Closing Date is $2,555,700 ("Projected Net
Working Capital"). In the event the actual Net Working Capital of the Business
as of the Closing Date ("Closing Net Working Capital") is determined to be less
than or greater than Projected Net Working Capital, the Purchase Price shall be
adjusted in the following manner: Within thirty (30) days following the Closing
Date, the actual Net Working Capital as the Closing Date shall be determined by
Seller and such determination shall be subject to reasonable review and
confirmation by Purchaser. The Purchase Price shall be increased by the amount
that Closing Net Working Capital exceeds Projected Net Working Capital. The
Purchase Price shall be reduced by the amount that Projected Net Working Capital
exceeds Closing Net Working Capital. Any adjustment to the Purchase Price
pursuant to this Section 2.2 shall be due and payable by the applicable party
within ten (10) days following determination of the Closing Net Working Capital.
For purposes of this Agreement, "Net Working Capital" shall mean the current
assets of Seller with respect to the Business and the Purchased Assets minus the
current liabilities of Seller with respect to the Business and the Purchased
Assets (other than current debt service on any loans) as determined in
accordance with generally accepted accounting principles.
2.3 Adjustment to Purchase Price for Certain Capital Expenditures. The
Purchase Price is based upon the presumption that Purchaser will incur capital
expenditures for the Business in the amount of at least $1,594,000 ("Projected
Capital Expenditures") during the period from the Closing Date until the last
day of the twelfth calendar month following the month in which the Closing
occurs ("Capital Expenditure Period"). In the event the actual amount of capital
expenditures for the Business during the Capital Expenditure Period ("Actual
Capital Expenditures") is less than the Projected Capital Expenditures, the
Purchase Price shall be increased by the difference between the Projected
Capital Expenditures and the Actual Capital Expenditures. Within sixty (60) days
following the end of the Capital Expenditure Period, Purchaser shall deliver to
Seller written documentation evidencing, to Seller's reasonable satisfaction,
the Actual Capital Expenditures by Purchaser during the Capital Expenditure
Period. Any adjustment to the Purchase Price pursuant to this Section 2.3 shall
be due and payable by Purchaser within ninety (90) days following the end of the
Capital Expenditure Period.
ARTICLE 3
ADDITIONAL COVENANTS
3.1 Due Diligence. Prior to the Closing Date, Seller shall have delivered
to Purchaser all schedules (the "Disclosure Schedules") containing information
regarding the Seller required to be attached hereto. The Disclosure Schedules
shall be deemed for all purposes of this Agreement
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<PAGE> 5
to constitute an integral part of this Agreement and the representations and
warranties of the Seller contained therein. The parties hereto acknowledge and
agree that the information in the Disclosure Schedules are provided based upon
the knowledge of Seller, without any inquiry, and no representations or
warranties whatsoever are hereby made with respect to the completeness or
accuracy of the Disclosure Schedules.
3.2 Employment Matters. Purchaser shall have the right to hire any and all
of the employees of the Business as of the Closing Date. From and after the date
of this Agreement, Seller shall assist Purchaser with transferring the employees
of the Business to Purchaser so that the process is completed on the Closing
Date. Seller shall be responsible for providing all notices and other
communications to employees of Seller which may be required under the Worker
Adjustment and Retraining Act (the "WARN Act") or any other applicable statute,
law or regulation in connection with the transaction contemplated hereby. Seller
shall terminate all of its employees employed by the Business whom Purchaser
shall hire effective as of the Closing Date. Seller shall pay all obligations,
imposed by law or otherwise, to such employees for all periods through the
Closing Date, including, without limitation, obligations for payroll, vacation
time, sick time and other obligations in connection with such employees. Seller
shall assist Purchaser in continuing the Employee Benefit Plans. Purchaser shall
assume all the obligations and liabilities whatsoever in respect of severance,
accrued vacation or sick leave, WARN Act, income tax withholding, payroll and/or
unemployment tax, workers' compensation, pension, profit-sharing, health
insurance, FMLA (as hereinafter defined), COBRA (as hereinafter defined) or any
other employee or other benefit liabilities in respect of any employees in the
Business or in respect of any Employee Benefit Plans (as hereinafter defined),
including, without limitation any contribution, tax, lien, penalty, cost,
interest, claim, loss, action, suit, damage, cost assessment, withdrawal
liability, liability to the Pension Benefit Guaranty Corporation (the "PBGC"),
liability under Section 412 of the Internal Revenue Code of 1986, as amended
(the "Code") or Section 302(a)(2) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA") or other similar liability or expense of Seller.
3.3 Consents. Prior to the Closing, Seller shall deliver to Purchaser
copies of all correspondence to and from landlords and tenants of the Assumed
Leases and the landlords of the subleased facilities pursuant to the Master
Lease. In addition, prior to the Closing Date, Seller shall deliver to Purchaser
consents from the landlords and/or tenants as applicable of the Assumed Leases
and the landlords of the subleased facilities pursuant to the Master Lease.
Purchaser agrees to cooperate with Seller, upon Seller's request, in Seller's
effort to obtain the required consents. Any charges imposed by the landlords or
other parties for such consents shall be borne by Seller.
3.4 Allocation of Purchase Price Among Purchased Assets. The Purchase
Price shall be allocated for tax purposes among each item or class of Purchased
Assets as mutually agreed to by Purchaser and Seller and set forth on Schedule
3.4 attached hereto. Seller and Purchaser agree that they will prepare and file
any notice or other filing required pursuant to Section 1060 of the Code, and
that any such notices or filings will be prepared based upon such tax allocation
of the Purchase Price. Purchaser agrees to send to Seller a completed copy of
its Form 8594 ("Asset Acquisition Statement under Section 1060") with respect to
this transaction prior to filing such form with the Internal Revenue Service.
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3.5 Tax Matters.
(a) As used in this Agreement, the following terms have the
specified meanings:
(i) "Tax Authority" shall mean any United States federal,
foreign, national, state, county or municipal or other local government, any
subdivision, agency, commission or authority thereof, or any quasi-governmental
body exercising any taxing authority or any other authority exercising tax
regulatory authority.
(ii) "Tax Return" shall mean any return, amended return,
estimated return, information return and statement (including any related or
supporting information) filed or to be filed with any Tax Authority in
connection with the determination, assessment, collection or administration of
any Tax.
(iii) "Tax(es)" shall mean all taxes, charges, fees, interest,
fines, penalties, additions to tax or other assessments, including without
limitation, income, excise, environmental, property, sales, gross receipts,
gains, transfer, occupation, privilege, employment (including social security
and unemployment), use, value added, capital stock or surplus, franchise taxes,
advance corporate tax and customs duties imposed by any Tax Authority, payable
by Seller or relating to or chargeable against Seller's assets, revenues or
income.
(b) Subject to Section 3.5(c) hereof, Seller shall be solely
responsible for and shall pay, without any cost to the Purchaser (i) any and all
Taxes for which Seller is or may be liable, arising from Seller's activities,
the Business or use of the Purchased Assets prior to Closing (regardless of
whether the filing of any Tax Return with respect thereto or payment of any
amount in respect thereof is filed, paid or due prior to, on or after the
Closing Date), (ii) any Taxes with respect to the acquisition by Purchaser from
Seller of the Purchased Assets, and all other Taxes, if any, imposed by any Tax
Authority assessed in connection with, on account of or resulting from the
consummation of the transfer of the Purchased Assets to the Purchaser.
(c) Real and personal property ad valorem Taxes, if any, with
respect to the Purchased Assets shall be prorated between Seller on the one
hand, and the Purchaser on the other hand, as of the Closing Date. Should any
amount of such Taxes to be prorated not be fully determined as of the Closing
Date, a mutually satisfactory estimate of such amount, made on the basis of
Seller's records, shall be used as the basis for settlement at Closing, and the
amount finally determined will be prorated and appropriate settlement
adjustments made as soon as practicable after such final determination.
(d) Except as otherwise provided in this Agreement, the parties
hereby agree that each of them shall cooperate with the other in executing or
causing to be executed any required document and by making available to the
other all work papers, records and notes of any kind at all reasonable times for
the purpose of allowing the appropriate party to complete Tax Returns,
participate in a proceeding, obtain refunds, make any determination required
under this Agreement or defend or prosecute Tax claims. Notwithstanding anything
to the contrary contained herein, Seller shall have sole and exclusive
responsibility and authority to prepare and file all Tax Returns
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concerning Seller related activities occurring prior to the Closing, including,
without limitation, its operation of the Business and its use of the Purchased
Assets and all matters under agreements whether or not being assumed by
Purchaser (regardless of when such return is filed). Purchaser shall be given
copies of any such return related to the Business filed by Seller.
3.6 Transaction Expenses. All of the expenses incurred by Purchaser in
connection with the authorization, negotiation, preparation, execution and
performance of this Agreement and other agreements referred to herein and the
consummation of the transactions contemplated hereby, including, without
limitation, all fees and expenses of agents, representatives, brokers, counsel
and accountants for Purchaser, shall be paid by Purchaser ("Purchaser
Transaction Expenses"). All expenses incurred by the Seller in connection with
the authorization, negotiation, preparation, execution and performance of this
Agreement and the other agreements referred to herein and the consummation of
the transactions contemplated hereby, including without limitation, all fees and
expenses of agents, representatives, brokers, counsel and accountants, shall be
paid by the Seller ("Seller Transaction Expenses").
3.7 Access to Books and Records. After the Closing, Purchaser shall
preserve all of the records and books pertaining to the Business and the
Purchased Assets relating to the period prior to Closing until the later of (a)
the longest time period prescribed by any relevant Tax Authority for the
retention of supporting documentation for Tax Returns for periods beginning
prior to the Closing date, and regardless of whether such periods end before or
after the Closing Date or (b) the seventh anniversary of the Closing Date, and,
until such time, make them available, during normal business hours, to Seller
and its designees, counsel, accountants, and others authorized by them for
inspection and the making of copies thereof.
3.8 Operation in Ordinary Course. Seller shall operate the Business in the
ordinary course through the Closing Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
In order to induce the Purchaser to enter into this Agreement and
consummate the transactions contemplated hereby, Seller represents and warrants
to the Purchaser as follows, each of which warranties and representations is
material to and relied upon by the Purchaser.
4.1 Organization and Authority of Seller. Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware. Seller has all necessary corporate power and authority to
own, lease and operate its properties and conduct its business as it is
currently being conducted.
4.2 Corporate Power and Authority; Due Authorization. Seller has full
corporate power and authority to execute and deliver this Agreement and each of
the Transaction Documents to which Seller is or will be a party and to
consummate the transactions contemplated hereby. "Transaction Documents" means
each of the agreements, documents and instruments referenced in this Agreement
to be executed and delivered by Seller. Prior to the Closing, the directors and
the
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stockholders of Seller shall have duly approved and authorized the execution and
delivery of this Agreement and each of the Transaction Documents to which Seller
is or will be a party and the consummation of the transactions contemplated
hereby and thereby, and no other corporate proceedings shall then be necessary.
Assuming that this Agreement and each of the Transaction Documents to which
Purchaser is a party constitutes a valid and binding agreement of the Purchaser,
this Agreement and each of the Transaction Documents constitutes, or will
constitute when executed and delivered, a valid and binding agreement of Seller,
in each case enforceable in accordance with its terms, subject to laws of
general application in effect affecting creditors' rights and subject to the
exercise of judicial discretion in accordance with general equitable principles.
4.3 Tax Returns and Payments. Seller has correctly and timely filed all
Tax Returns required by law to be filed on or before the date of this Agreement
and shall correctly and timely file all Tax Returns required by law to be filed
on or prior to the Closing Date. All such Tax Returns are true, correct and
complete in all respects, and all amounts shown as owing thereon have been paid.
No penalties, interest or other charges are or will be due with respect to the
late filing of any such Tax Returns. Seller has made all estimated Tax payments
required to be made under the Code. Taxes for all Tax periods (or portions
thereof) ending prior to or on the Closing Date have been, or prior to the
Closing shall be, fully paid.
4.4 Litigation. To Seller's knowledge, without inquiry, there is not (i)
any material claim, legal action, suit, arbitration, governmental investigation
or other legal or administrative proceeding affecting the delivery of the
Purchased Assets as required hereunder or (ii) order, decree or judgment in
progress, pending or in effect or threatened, affecting the delivery of the
Purchased Assets as required hereunder and Seller does not know or have reason
to know of any basis for the same.
4.5 Benefit Plans and ERISA. To Seller's knowledge, without inquiry,
Schedule 4.5 sets forth a true and complete list of each "employee benefit plan"
(as defined by Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")), (each such plan, agreement, policy, trust fund or
arrangement is referred to herein as an "Employee Benefit Plan", and
collectively, the "Employee Benefit Plans" that is currently in effect, or which
has been approved before the date hereof but is not yet effective, for the
benefit of employees, and their beneficiaries or any other persons performing
services for Seller in the Business.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
In order to induce Seller to enter into this Agreement and consummate the
transactions contemplated hereby, the Purchaser represents and warrants to
Seller as follows, each of which representations and warranties is material to
and relied upon by Seller:
5.1 Organization of the Purchaser. The Purchaser is a limited liability
company duly organized and validly existing under the laws of the State of
Delaware and has the power and authority to own its property and to carry on its
business as now being conducted by it.
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5.2 Power and Authority; Due Authorization. The Purchaser has full power
and authority to execute and deliver this Agreement and each of the other
agreements, documents and instruments referenced in this Agreement to which the
Purchaser is or will be a party (the "Purchaser's Transaction Documents") and to
consummate the transactions contemplated hereby and thereby. Prior to the
Closing, the Manager of the Purchaser shall have duly approved and authorized
the execution and delivery of this Agreement and each of the Purchaser's
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, and no other proceedings on the part of the Purchaser are
necessary to approve and authorize the execution and delivery of this Agreement
and such Purchaser's Transaction Documents and the consummation of the
transactions contemplated hereby and thereby. Assuming that this Agreement and
each of the Purchaser's Transaction Documents constitutes a valid and binding
agreement of Seller, this Agreement and each of the Purchaser's Transaction
Documents constitutes, or will constitute when executed and delivered, a valid
and binding agreement of the Purchaser, enforceable against the Purchaser in
accordance with its terms, subject to laws of general application in effect
affecting creditors' rights and subject to the exercise of judicial discretion
in accordance with general equitable principles.
ARTICLE 6
CONDITIONS TO OBLIGATIONS OF
THE PURCHASER TO CLOSE
Each and every obligation of the Purchaser under this Agreement to be
performed on or prior to the Closing shall be subject to the fulfillment, on or
prior to the Closing, of each of the following conditions unless and to the
extent any such condition is expressly waived in writing by Purchaser:
6.1 Representations and Warranties True at Closing. The representations
and warranties made by Seller in or pursuant to this Agreement or given on its
behalf hereunder shall be true and correct in all material respects on and as of
the Closing Date.
6.2 Obligations Performed. Seller shall have performed and complied in all
material respects with all agreements, conditions and obligations required by
this Agreement to be performed or complied with by it prior to or at the
Closing.
6.3 Consents. Seller shall have obtained and delivered to Purchaser
written consents of all persons or entities whose consent is required to
consummate the transactions contemplated herein, if any, and all of such
consents shall remain in full force and effect at and as of the Closing,
including the consents to assignment of the Assumed Leases and to subleasing
under the Master Lease.
6.4 Closing Deliveries. Seller shall have delivered to Purchaser each of
the following, together with any additional items which Purchaser may reasonably
request to effect the transactions contemplated herein:
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(a) possession of the Purchased Assets;
(b) a certified copy of the corporate resolutions of the directors
of Seller authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Transaction Documents by
Seller,
(c) the documents and instruments described in Section 1.3 hereof;
(d) written consents from all persons and entities whose consent to
the transactions contemplated herein is required;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
6.5 Disclosure Schedules. Seller shall have provided Purchaser with
updated Disclosure Schedules dated as of the Closing Date.
6.6 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
6.7 No Changes Prior to Closing. After execution of this Agreement and
prior to the Closing Date, none of the following shall have occurred:
(a) damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, materially and adversely affecting the Business; or
(b) the legal inability of Seller to convey, assign and transfer to
Purchaser any material portion of the Purchased Assets with the effect of
materially and adversely affecting the ability of Purchaser to utilize the
Purchased Assets in a manner consistent with the operation of the Business.
ARTICLE 7
CONDITIONS TO SELLER'S OBLIGATIONS
Each and every obligation of Seller under this Agreement to be performed
on or prior to the Closing, shall be subject to the fulfillment, on or prior to
the Closing, of each of the following conditions unless and to the extent any
such condition is specifically waived in writing by Seller:
7.1 Representations and Warranties True at Closing. The representations
and warranties made by Purchaser in or pursuant to this Agreement or given on
its behalf hereunder shall be true and correct in all material respects, on and
as of the Closing Date.
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7.2 Obligations Performed. The Purchaser shall have performed and complied
in all material respects with all agreements, conditions and obligations
required by this Agreement to be performed or complied with by it prior to or at
the Closing.
7.3 Closing Deliveries. The Purchaser shall have delivered to Seller each
of the following, together with any additional items which Seller may reasonably
request to effect the transactions contemplated herein:
(a) the Purchase Price;
(b) evidence of authority of the Manager of the Purchaser
authorizing the transactions contemplated herein and the execution,
delivery and performance of this Agreement and the Purchaser's Transaction
Documents by the Purchaser;
(d) the documents and instruments described in Section 1.3 hereof;
(e) any other documents or agreements contemplated hereby and/or
necessary or appropriate to consummate the transactions contemplated hereby.
7.4 Legality. No federal or state statute, rule, regulation, executive
order, decree or injunction shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which is in effect and has the
effect of making the transactions contemplated herein illegal or otherwise
prohibiting the consummation of the transactions contemplated herein.
ARTICLE 8
MISCELLANEOUS PROVISIONS
8.1 Severability. If any provision of this Agreement is prohibited by the
laws of any jurisdiction as those laws apply to this Agreement, that provision
shall be ineffective to the extent of such prohibition and/or shall be modified
to conform with such laws, without invalidating the remaining provisions hereto.
8.2 Modification. This Agreement may not be changed or modified except in
writing specifically referring to this Agreement and signed by each of the
parties hereto.
8.3 Assignment, Survival and Binding Agreement. This Agreement and the
Transaction Documents and the Purchaser's Transaction Documents may not be
assigned by the Seller without the prior written consent of Purchaser. The terms
and conditions hereof shall survive the Closing as provided herein and shall
inure to the benefit of and be binding upon the parties hereto and their
respective heirs, personal representatives, successors and assigns.
8.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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<PAGE> 12
8.5 Notices. All notices, requests, demands, claims or other
communications hereunder will be in writing and shall be deemed duly given if
personally delivered, sent by a recognized overnight delivery service which
guarantees next day delivery ("Overnight Delivery") or mailed by registered or
certified mail, return receipt requested, postage prepaid and addressed to the
intended recipient as set forth below:
If to Seller: VC Missouri Holdings, L.L.C.
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
If to the Purchaser: AmeriCold Logistics II, LLC
10 Glenlake Parkway, Suite 800
Atlanta, Georgia 30328
Attn: President
Telefax: (678) 441-6847
or at such other address as any party hereto notifies the other parties hereof
in writing. The parties hereto agree that notices or other communications that
are sent in accordance herewith (i) by personal delivery, will be deemed
received on the day sent or on the first business day thereafter if not sent on
a business day, (ii) by Overnight Delivery, will be deemed received on the first
business day immediately following the date sent, and (iii) by U.S. mail, will
be deemed received three (3) business days immediately following the date sent.
For purposes of this Agreement, a "business day" is a day on which Purchaser is
open for business and shall not include a Saturday or Sunday or legal holiday.
Notwithstanding anything to the contrary in this Agreement, no action shall be
required of the parties hereto except on a business day and in the event an
action is required on a day which is not a business day, such action shall be
required to be performed on the next succeeding day which is a business day.
8.6 Entire Agreement; No Third Party Beneficiaries. This Agreement,
together with the Exhibits and Schedules attached hereto, constitutes the entire
agreement and supersedes any and all other prior agreements and undertakings,
both written and oral, among the parties, or any of them, with respect to the
subject matter hereof and, except as otherwise expressly provided herein, is not
intended to confer upon any person other than Seller and Purchaser, any rights
or remedies hereunder.
8.7 Further Assurances. The parties to this Agreement agree to execute and
deliver, both before and after the Closing, any additional information,
documents or agreements contemplated hereby and/or necessary or appropriate to
effect and consummate the transactions contemplated hereby. Seller agrees to
provide to Purchaser, both before and after the Closing, such information as
Purchaser may reasonably request in order to consummate the transactions
contemplated hereby and to effect an orderly transition of the Business
following Closing.
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<PAGE> 13
8.8 Governing Law and Submission to Jurisdiction. Except as otherwise
expressly provided herein, this Agreement shall be governed by and construed
under the laws of the State of Delaware without giving effect to otherwise
applicable principles of conflicts of laws.
8.9 Pronouns. All personal pronouns in this Agreement, whether used in the
masculine, feminine or neuter gender shall include all other genders, and the
singular shall include the plural and the plural shall include the singular.
8.10 Survival of Representations and Warranties. The representations and
warranties set forth in this Agreement shall survive the Closing for a period of
one year and thereafter such representations and warranties shall be null and
void with no further force and effect.
[Signatures on next page]
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<PAGE> 14
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
PURCHASER:
AMERICOLD LOGISTICS II, LLC
By: /s/ Frederick B. Beilstein III
------------------------------------
Name: Frederick B. Beilstein III
----------------------------------
Its: Senior Vice President
-----------------------------------
SELLER:
VC MISSOURI HOLDINGS, L.L.C.
By: /s/ Daniel F. McNamara
------------------------------------
Name: Daniel F. McNamara
----------------------------------
Its: President
----------------------------------
<PAGE> 15
LIST OF SCHEDULES AND EXHIBITS
Schedule 1.1(a) Fixed Assets
Schedule 1.1(b) Contracts
Schedule 1.1(c) Assumed Leases
Schedule 1.1(e) Intellectual Property
Schedule 3.4 Purchase Price Allocation
Schedule 4.5 Employee Benefit Plans
Exhibit 1.3(a) Bill of Sale
Exhibit 1.3(b) Assignment of Contracts
Exhibit 1.3(c) Assignment of Customer Leases
Exhibit 1.3(d) Assignment of Equipment Leases
Exhibit 1.3(e) Master Lease
<PAGE> 1
Exhibit 10.1
March 11, 1999
COPI Cold Storage L.L.C.,
777 Main Street,
Fort Worth, TX 76102.
Re: Formation of Partnership for Cold Storage Operations
Dear Sirs:
A. Contemporaneously herewith,
1. Americold Corporation, an Oregon corporation ("Americold"), as
seller and assignor, and AmeriCold Logistics, LLC, a Delaware limited
liability company ("OpCo I"), as purchaser and assignee, have entered
into:
a. an Asset Purchase Agreement and a Master Lease, each dated
as of February 28, 1999 and each with respect to certain assets used
in connection with the cold storage facilities owned by Americold
and/or its affiliates (collectively, the "Americold Facilities"),
and
b. various assignments and assumptions in respect of a master
lease and operating and warehouse agreements affecting the Americold
Facilities.
2. URS Logistics, Inc., a Delaware corporation ("URS"), as seller
and assignor, and the Partnership (as defined herein), as purchaser and
assignee, have entered into:
a. an Asset Purchase Agreement and a Master Lease, each dated
as of the date hereof and each with respect to certain assets used
in connection with the cold storage facilities now owned by URS
and/or its affiliates (collectively, the "URS Facilities"), and
b. various assignments and assumptions in respect of a master
lease and operating and warehouse agreements affecting the URS
Facilities.
<PAGE> 2
COPI Cold Storage L.L.C.
March 11, 1999
Page 2
3. VC Omaha Holdings, L.L.C., a Delaware limited liability company
("VC Omaha"), as seller and assignor, and OpCo I, as purchaser and
assignee, have entered into:
a. an Asset Purchase Agreement and a Master Lease, each dated
as of the date hereof and each with respect to certain assets used
in connection with the cold storage facilities now owned by VC Omaha
and/or its affiliates (collectively, the "Freezer Services
Facilities"), and
b. various assignments and assumptions in respect of operating
and warehouse agreements affecting the Freezer Services Facilities.
4. VC Missouri Holdings, L.L.C., a Delaware limited liability
company ("VC Missouri"), as seller and assignor, and Americold Logistics
II, LLC, a Delaware limited liability company ("OpCo II"), as purchaser
and assignee, have entered into:
a. an Asset Purchase Agreement and a Master Lease, each dated
as of the date hereof and each with respect to certain assets used
in connection with the cold storage facilities now owned by VC
Missouri and/or its affiliates (collectively, the "Carmar
Facilities" and, together with the Americold Facilities, URS
Facilities and Freezer Services Facilities, the "Cold Storage
Facilities"), and
b. various assignments and assumptions in respect of operating
and warehouse agreements affecting the Carmar Facilities.
B. It is the intention and agreement of Americold, URS, VC Omaha, VC
Missouri, OpCo I and OpCo II that, from and after the date hereof, the
operations now conducted or hereafter to be conducted at the Cold Storage
Facilities (the "Cold Storage Operations Business") shall be conducted by OpCo I
and OpCo II.
C. COPI Cold Storage L.L.C., a Delaware limited liability company
("Crescent"), and Vornado Operating L.P., a Delaware limited partnership
("Vornado"), hereby agree to form a partnership to own OpCo I and OpCo II and,
through OpCo I and OpCo II, to conduct the Cold Storage Operations Business on
the following terms. Each of us acknowledges that we have all necessary board
approvals and other
<PAGE> 3
COPI Cold Storage L.L.C.
March 11, 1999
Page 3
organizational authorizations to enter into this transaction. Affiliates of
Vornado and Crescent are also partners in Vornado Crescent Portland Partnership,
Vornado Crescent Atlanta Partnership and Vornado Crescent Omaha Partnership, and
the business conducted by such partnerships, this Partnership and any other
partnerships entered into hereafter between affiliates of Vornado and Crescent
in respect of the cold storage business are collectively referred to herein as
the "Overall Cold Storage Business".
D. The agreed upon terms are as follows:
1. Partnership. The name of the partnership is "Vornado Crescent
Logistics Operating Partnership" (the "Partnership"). Concurrently with
the negotiation of definitive partnership agreements for Vornado Crescent
Atlanta Partnership, Vornado Crescent Portland Partnership and Vornado
Crescent Omaha Partnership, the parties (a) shall commence the negotiation
of a definitive partnership agreement evidencing the partnership created
hereby and such other terms as the parties shall mutually agree (a
"definitive partnership agreement") and (b) shall execute and deliver, or
cause to be executed and delivered, as applicable, a definitive
partnership agreement, provided that the parties' failure to execute and
deliver a definitive partnership agreement shall not affect the parties'
agreements as set forth herein, and the Partnership shall continue to be
operated, and the rights and obligations of the parties as partners in the
Partnership shall continue to be governed, pursuant to the terms of this
agreement.
2. Acquisition Vehicle. The Cold Storage Operations Business shall
be acquired and conducted by OpCo I and OpCo II, and the Partnership will
be the sole member of each of OpCo I and OpCo II. OpCo I and OpCo II each
is a limited liability company newly formed for such purpose.
3. Interim Decisions. From and after the date hereof until the
execution and delivery of a definitive partnership agreement, all
decisions with respect to the acquisition of the Cold Storage Operations
Business and all operational decisions with respect thereto shall be made
by Vornado.
4. Ownership. Crescent will hold 40% and Vornado will hold 60% of
the ownership, capital and financial interest in the Partnership. Vornado
will contribute 60% and Crescent will contribute 40% of all costs required
to acquire the assets and businesses in connection with the transactions
described in paragraph A hereof (including all transaction costs).
<PAGE> 4
COPI Cold Storage L.L.C.
March 11, 1999
Page 4
5. Management.
a. Each partner will be required to approve the following
actions:
(i) approval of the annual capital and operating budgets
of the Cold Storage Operations Business, any deviations in any
such budget by 10% or more in the aggregate (when taken
together with all other variances in the annual and capital
and operating budgets for all of the Overall Cold Storage
Business), the hiring or firing of a chief executive officer
of the Cold Storage Operations Business and any required
capital contributions by the partners of the Partnership
which, together with the required capital contributions of the
partners of the other partnerships in the Overall Cold Storage
Business, are in excess of $5 million per year,
(ii) other than transactions necessary to preserve
either Vornado's and Crescent's affiliates' REIT status or a
structural reconfiguration to achieve the optimal tax vehicle,
any transactions with an affiliate of any partner, the entry
as lessee into a lease of any capital asset or an amendment to
an existing lease of any capital asset, the sale or
acquisition of any asset (including, without limitation,
equity interests in any entity) by the Cold Storage Operations
Business with a value of more than $12 million, the creation
of any security interest, lien or other encumbrance on any of
the Partnership's assets which treats one partner differently
from another, the making of any loan, advance or extension of
credit to any partner, any guarantee of any direct or indirect
obligation of any partner, and any sale, liquidation or merger
of the Cold Storage Operations Business (other than a
combination of the Cold Storage Operations Business with other
entities or operations that are a part of the Overall Cold
Storage Business); and
(iii) Vornado is hereby authorized to execute and
deliver on behalf of the Partnership any and all documents,
instruments. filings and certificates, and take such other
steps as may be
<PAGE> 5
COPI Cold Storage L.L.C.
March 11, 1999
Page 5
reasonably required, in connection with the purchase and
acquisition of the assets described in Paragraph A hereof.
b. Vornado will serve as operating partner of the Partnership,
and Vornado Realty L.P. ("VRLP") shall serve as the operator and
day-to-day liaison to management of the Partnership's subsidiaries.
While it is our intention that the Cold Storage Operations Business
would operate relatively autonomously, any required decisions which
would not fall within paragraph D.5.a of this agreement would be
made by VRLP. VRLP or its designee, in consideration for serving in
the manner described above in this paragraph b., shall receive a fee
per annum equal to (i) with respect to those assets and entities
described in paragraph A.1 hereof, $487,000.00 and (ii) with respect
to any other Cold Storage Operations Business entities and assets
(but not equipment, machinery and the like) acquired subsequent to
the date hereof, 1% of the cost (including for such purposes the
amount of indebtedness on the acquired entity or assets at the time
of acquisition and all expenses incurred in such acquisition) paid
by OpCo I and OpCo II to acquire such entities or assets hereafter
acquired.
6. Term. Except as otherwise agreed by the partners, the Partnership
shall continue for a term through October 30, 2027. The Partnership shall
preserve and maintain its existence and all its rights, privileges and
franchises. Neither partner shall have the right to withdraw from the
Partnership, except as provided herein, nor shall either partner have the
right to cause the dissolution, termination, liquidation or winding-up of
the Partnership without the consent of the remaining partner.
7. Agreement to Act in Good Faith. Each partner shall (and the
definitive partnership agreement shall require each partner to) cooperate
with the other partner thereto to carry out the purpose and intent of the
Partnership, including without limitation the execution and delivery to
the appropriate party of all such further documents as may reasonably be
required in order to carry out the terms of the Partnership. The parties
shall act in a commercially reasonable manner in good faith with one
another in negotiating the terms of a definitive partnership agreement and
all required contracts, agreements or documents, in operating the
Partnership, and in carrying out the terms of this agreement.
<PAGE> 6
COPI Cold Storage L.L.C.
March 11, 1999
Page 6
8. Buy/Sell. In the event the partners fail in good faith to reach
an agreement with respect to any matters set forth in paragraph D.5.a
hereof on a timely basis during the period commencing on the date hereof
and expiring October 30, 2000, Vornado shall be entitled to buy Crescent's
interest at cost plus a 10% per annum return (taking into account all
distributions). Thereafter, for the next seven years, upon such failure,
Vornado may set a price at which it commits to either buy Crescent's
investment, or sell its own, which decision to buy or sell shall be made
by Crescent. Thereafter, upon such failure, either party may set a price
at which it commits to either buy the other party's investment, or sell
its own, which decision to buy or sell shall be made by the other party.
In addition, without limiting the requirement, as expressed in paragraph
D.10 hereof, for a party hereto seeking to transfer or otherwise assign
its rights or interests in this agreement or in the Partnership (a
"transferor") to obtain the consent of the other party hereto (the
"non-transferor") to such transfer or assignment, if such consent shall be
given, the non-transferor shall nevertheless have a right of first refusal
with respect to such transfer or assignment, except that, through October
30, 2000, Vornado's purchase price with respect to Crescent's interest
under such right of first refusal shall be cost plus a 10% return (taking
into account all distributions). In all cases under this paragraph D.8,
any purchases or sales must be made in conjunction with the purchase or
sale of the interest of the Crescent or Vornado entity in any other
partnerships in the Overall Cold Storage Business and the parties hereto
agree to purchase or sell their interests hereunder if paragraph D.8 is
triggered under the partnership agreements of any other partnerships in
the Overall Cold Storage Business.
9. Expenses. The parties shall each pay their own fees and expenses,
and those of their agents, advisors, attorneys and accountants, with
respect to the negotiation of this agreement and the formation of the
Partnership, and shall evenly split the expenses incurred on account of
the Partnership in connection with the acquisition of new businesses and
assets (as distinguished from equipment and the like) in connection with
the Cold Storage Operations Business (and with respect to the expenses
incurred by the Partnership in connection with the transactions described
in paragraph A hereof, such expenses shall be split as set forth in
paragraph D.4 above). Vornado estimates that the amount of the expenses
incurred on account of the Partnership (or for which the Partnership will
ultimately be responsible) in connection with the negotiation, preparation
and execution of the agreements and instruments described in paragraph A
hereof and all instruments to be delivered thereunder will not exceed
$1,500,000 (but the
<PAGE> 7
COPI Cold Storage L.L.C.
March 11, 1999
Page 7
same is only Vornado's current estimate and shall not serve as a maximum
amount).
10. Assignment. The rights and interest of either party under this
agreement or in the Partnership shall not be assignable or otherwise
transferrable by either party without the other party's consent, except as
a structural reconfiguration to achieve the optimal tax vehicle and except
that Vornado shall have the right to assign its interest hereunder and in
the Partnership to an entity wholly owned directly or indirectly by
Vornado (whereupon all references herein to "Vornado" shall be deemed to
refer to such assignee).
11. Public Announcement. Vornado will act as spokesperson for the
Partnership and will provide notice to Crescent of any proposed press
release or other public announcement, and will work with Crescent on the
content of any such press release or public announcement.
12. Agreement Not to Compete. The parties agree that so long as the
Partnership continues in existence, no partner thereto shall engage in the
cold storage businesses of the type conducted in the Cold Storage
Operations Business except through the Cold Storage Operations Business or
another aspect of the Overall Cold Storage Business.
13. Miscellaneous.
a. This agreement and all transactions hereunder shall be
governed by the laws of the State of Delaware, without regard to the
application of conflict of law principles. The parties hereby
irrevocably submit to the jurisdiction of the courts of the State of
Delaware and to the U.S. District Court for the Southern District of
New York solely in respect of the interpretation and enforcement of
the provisions of this agreement, and hereby waive, and agree not to
assert, as a defense in any action, suit or proceeding for the
interpretation or enforcement hereof or of any such document, that
it is not subject thereto or that such action, suit or proceeding
may not be brought or is not maintainable in said courts or that the
venue thereof may not be appropriate or that this agreement may not
be enforced in or by such courts, and the parties hereto irrevocably
agree that all claims with respect to such action or proceeding
shall be heard and determined in such a Delaware State court or
Federal District Court for the
<PAGE> 8
COPI Cold Storage L.L.C.
March 11, 1999
Page 8
Southern District of New York. The parties hereby consent to and
grant any such court jurisdiction over the person of such parties
and over the subject matter of such dispute.
b. This agreement, together with the other partnership
agreements between the parties and their affiliates relating to the
Overall Cold Storage Business and any other instruments being
entered into by the parties concurrently herewith, constitutes the
entire agreement between the parties with respect to the subject
matter herein; provided, however, that this agreement contemplates
the negotiation and execution of a definitive partnership agreement
after the execution of this agreement as provided herein, which also
shall be binding on the parties thereto following execution thereof.
c. No amendment or waiver of any provision of this agreement
shall be effective unless in writing and signed by the party or
parties against whom enforcement is sought. No failure or delay by
any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of
any rights or remedies provided by law.
d. The rule that an agreement should be construed against the
party drafting it shall not apply to this agreement because both
parties have played a significant role in negotiating and drafting
this agreement.
e. This agreement 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.
f. Signatures may be transmitted by facsimile and will be
accepted and considered delivered as if an original.
<PAGE> 9
COPI Cold Storage L.L.C.
March 11, 1999
Page 9
VORNADO OPERATING L.P.
By: Vornado Operating Company, its general
partner
By: /s/ Irwin Goldberg
-------------------------------------------
Name: Irwin Goldberg
Title: Vice President -- Chief Financial
Officer
COPI COLD STORAGE L.L.C.
By: Crescent Operating, Inc., its sole member
By: /s/ Jeff Stevens
-------------------------------------------
Name: Jeff Stevens
Title: EVP & COO
<PAGE> 1
Exhibit 99.2
CONTACT: VORNADO OPERATING COMPANY
JOSEPH MACNOW
(201) 587-1000
CRESCENT OPERATING INC.
JEFFREY L. STEVENS
(817) 339-2210
[Vornado Operating Company logo]
Park 80 West, Plaza II
Saddle Brook, New Jersey 07663
FOR IMMEDIATE RELEASE - March 17, 1999
SADDLE BROOK, NEW JERSEY: VORNADO OPERATING COMPANY (AMEX: VOO) and
CRESCENT OPERATING INC. (NASDAQ: COPI) today announced that they have formed a
new partnership that has purchased all of the non-real estate assets of
AmeriCold Logistics encompassing the operations of the cold storage business for
approximately $48 million from a partnership owned by VORNADO REALTY TRUST
(NYSE: VNO) and CRESCENT REAL ESTATE EQUITIES COMPANY (NYSE: CEI). This new
partnership will lease the underlying cold storage warehouses used in this
business from the partnership of Vornado Realty Trust and Crescent Real Estate
Equities Company which continues to own the real estate.
Vornado Operating Company owns 60% and Crescent Operating Inc. owns 40% of
the new partnership. AmeriCold Logistics is the nation's largest provider of
cold storage warehousing and transportation logistics to the frozen food
industry. AmeriCold Logistics provides a nationwide network of warehouses to
service its customers.
Vornado Operating Company, which is based in Saddle Brook, New Jersey, was
formed to own operating businesses. The above purchase is Vornado Operating
Company's initial investment in an operating business.
Crescent Operating Inc. is a real estate management company which owns,
leases or operates a portfolio of assets consisting of six full-service hotels
and two destination health and fitness resorts, a 50% interest in Charter
Behavioral Health Systems, LLC, an interest in refrigerated warehouses
facilities, an interest in three real estate development corporations, and a
heavy equipment sales and leasing business.
