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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):
NOVEMBER 9, 1998
------------------
AMERICAN AIRCARRIERS SUPPORT, INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE 0-24275 52-2081515
(State of Incorporation) (Commission File No.) (I.R.S. Employer
Identification No.)
3516 CENTRE CIRCLE DRIVE
FORT MILL, SOUTH CAROLINA 29715
(Address of principal executive offices)
(803) 548-2160
(Registrant's telephone number, including area code)
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ITEM 5. ACQUISITION OR DISPOSITION OF ASSETS
On November 9, 1998, American Aircarriers Support, Incorporated
(the "Company") completed the acquisition of substantially all of the operating
assets of Condor Flight Spares, Inc. ("Condor") pursuant to an Asset Purchase
Agreement (the "Agreement") dated as of November 9, 1998 among the Company,
American Aircarriers Support Acquisition III Corp., a wholly owned subsidiary of
the Company formed for the purpose of effecting the acquisition (the
"Subsidiary"), the Company, Condor, and Ned Angene and Martin Washofsky,
shareholders of Condor owning approximately 99% of the outstanding shares of
Condor (the "Shareholders"). Pursuant to the Agreement, the Company acquired
substantially all of the assets of Condor for a purchase price $1,750,000. The
purchase price was comprised of $1,000,000 cash paid from working capital and
issuance of 125,000 shares of the Company's Common Stock valued at $750,000.
Condor received one-half of the cash payment on November 9, 1998 and the other
one-half of the cash payment and the shares of Common Stock on November 30,
1998, the date upon which Condor received FAA certification to overhaul and
maintain landing gear for commercial aircraft.
Simultaneously with the execution of the Agreement, the Company entered
into a lease with Condor Properties of Miami, Inc. for real property and an
approximately 40,000 square foot facility where Condor's business is currently
located. Mr. Angene and Mr. Washofsky are principal shareholders of Condor
Properties of Miami, Inc. The initial rental payments of $21,650 per month
automatically increase by one percent per year annually during the initial ten
year term and any renewal terms.
For a period of one year, Condor may "piggy-back" the shares acquired
pursuant to the Agreement onto any registration statement which the Company
files to register any of its securities under the Securities Act of 1933, as
amended (the "Act"), in connection with a public offering for cash proceeds
payable in whole or in part to the Company. Condor also was granted the right to
"demand" that the Company file a registration statement under the Act covering
such shares. The "demand" registration right commences after September 1, 1999
and may only be exercised on one occasion. All expenses incurred in connection
with the registration of Condor shares pursuant to either the piggyback and
demand registration rights are payable by the Company, excluding underwriting
discounts or fees.
Simultaneously with the execution of the Agreement, the Company entered
into a five year employment agreement with each of the Shareholders. Under their
respective agreements, Mr. Angene is to serve as President of the Subsidiary and
Mr. Washofsky is to serve as Executive Vice President Head of Sales of the
Subsidiary and the Subsidiary will continue to operate the business previously
operated by Condor. Mr. Angene has over 34 years' experience in the landing gear
business and has served in various capacities with several successful landing
gear companies, including Menasco, Cleveland Pneumatic (now BF Goodrich), Dixie
Aircraft (now AAR Landing Gear) and Castle Precision Cleveland and joined Condor
in 1998. Mr. Washofsky has over 16 years' experience in the landing gear
business and founded Condor in early 1998.
Condor, located in the Miami, Florida area, is in the business of
buying and selling various landing gear parts for commercial and cargo aircraft.
On November 30, 1998, Condor received FAA certification to overhaul and maintain
landing gear for commercial airlines.
2
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FORWARD LOOKING STATEMENTS
This Report on Form 8-K may contain forward-looking statements. When
used in this report, the words "may," "will," "expect," "anticipate,"
"continue," "estimate," "project," "intend," "believe" and similar expressions,
variations of these words or the negative of those words are intended to
identify forward-looking statements within the meaning of Section 27A of the Act
and Section 21E of the Securities Exchange Act of 1934 regarding events,
conditions and financial trends including, without limitation, business
conditions in the aircraft spare parts industry and the general economy, and
other risks or uncertainties detailed in other of the Company's Securities and
Exchange Commission filings. Such statements are based on management's current
expectations and are subject to risks, uncertainties and assumptions. Should one
or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, the Company's actual plan of operations, business
strategy, operating results and financial position could differ materially from
those expressed in, or implied by, such forward-looking statements.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements relative to Condor are not required
pursuant to Item 310(c) and (d) of Regulation S-B.
(b) Pro forma financial information relative to Condor and the
Registrant are not required pursuant to Item 310(c) and (d) of Regulation S-B.
(c) The following exhibits are furnished herewith in accordance
with the provisions of Item 601 of Regulation S-B:
<TABLE>
<CAPTION>
Reg. S-B
Exhibit No. Description Item No.
- ----------- ----------- --------
<S> <C> <C>
2.3 Asset Purchase Agreement among the Company, American Aircarriers Support 2
Acquisition III Corp., Condor Flight Spares, Inc., Ned Angene and Martin
Washofsky
4.3 Registration Rights Agreement between the Company and Condor Flight 4
Spares, Inc.
10.1.4 Employment Agreement between the Company and Ned Angene 10
10.1.5 Employment Agreement between the Company and Martin Washofsky 10
10.5.3 Lease Agreement between the Company and Condor Properties of Miami, 10
Inc.
</TABLE>
3
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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.
AMERICAN AIRCARRIERS SUPPORT, INCORPORATED
Date: December 4, 1998 By: /s/ Elaine T. Rudisill
---------------------------------------------
Elaine T. Rudisill, Chief Financial Officer
4
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Reg. S-B
Exhibit No. Description Item No.
- ----------- ----------- --------
<S> <C> <C>
2.3 Asset Purchase Agreement among the Company, American Aircarriers Support 2
Acquisition III Corp., Condor Flight Spares, Inc., Ned Angene and Martin
Washofsky
4.3 Registration Rights Agreement between the Company and Condor Flight 4
Spares, Inc.
10.1.4 Employment Agreement between the Company and Ned Angene 10
10.1.5 Employment Agreement between the Company and Martin Washofsky 10
10.5.3 Lease Agreement between the Company and Condor Properties of Miami, 10
Inc.
</TABLE>
5
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EXHIBIT 2.3
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made and entered into as of the 9th
day of November, 1998, by and among CONDOR FLIGHT SPARES, INC., Florida
corporation ("Seller"), NED ANGENE and MARTIN WASHOFSKY (collectively referred
to as "Shareholders") and AMERICAN AIRCARRIERS SUPPORT ACQUISITION III CORP.
(the "Purchaser"), a Florida Subsidiary of AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED, a Delaware corporation ("AASI").
W I T N E S S E T H:
WHEREAS, the Seller is engaged in the business of maintaining,
overhauling, supplying and redistributing aircraft landing gear and associated
parts to commercial and cargo airlines.
WHEREAS, the Shareholders own approximately ninety-nine percent (99%)
of the outstanding shares of Seller.
WHEREAS, the Seller desires to sell and the Purchaser desires to
purchase substantially all the operating assets and properties used in the
business operations of Seller for cash and certain stock in AASI.
NOW, THEREFORE, the parties hereto agree that the purpose of this
Agreement is to set forth the terms and conditions upon which the Seller has
agreed to sell to the Purchaser certain of its business and assets; and the
Purchaser has agreed to purchase and pay for such business and assets; and
furthermore, the Seller and the Purchaser in consideration of the premises and
the mutual agreements contained herein, do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
Section 1.1 Assets to be Purchased and Sold.
(a) Description of Assets. At the Closing (as defined in Section 1.2),
the Seller shall sell and convey to the Purchaser, and the Purchaser shall
purchase and acquire from the Seller, substantially all the business and assets
of the Seller existing and owned by the Seller or used by the Seller in Seller's
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business on the Closing Date (as defined in Section 1.2) relating to Seller's
business, other than the Excluded Assets (as defined in Section 1.1(b)). The
assets of the Seller to be purchased hereunder (which shall not include the
Excluded Assets) are referred to herein as the "Subject Assets," and shall
include without limitation:
(i) all the Seller's inventory;
(ii) all the Seller's rights to prepaid license fees,
deposits, prepaid lease expenses and other rights acquired under any
leases, other than Excluded Assets (the "Prepaid Expenses"). The Seller
shall prepare a detailed listing of such Prepaid Expenses as of the
Closing Date which shall be included as Exhibit 1.1(a)(ii) hereto;
(iii) all furniture, fixtures, furnishings, tools, equipment,
supplies, parts, accessories, inventories, machinery, shelving,
computer equipment, signage, and other tangible personal property of
the Seller other than Excluded Assets (the "Tangible Property"),
including without limitation the items of Equipment and other Tangible
Property described on Exhibit 1.1(a)(iii) hereto and any additions or
accessions thereto or substitutions therefor or proceeds thereof;
(iv) to the extent Purchaser desires to acquire the same, all
rights of the Seller under all contracts, service agreements,
advertising agreements, sales contracts, customer orders, leases,
licenses, and agreements other than Excluded Assets (the "Contracts"),
including without limitation the Seller's rights existing on the
Closing Date under the Contracts described or referred to in Exhibit
1.1(a)(iv) hereto;
(v) (A) all rights of the Seller in the name "Condor Flight
Spares, Inc." and any trademarks, tradenames or service marks, and all
registrations thereof and pending applications therefor, in connection
therewith (the "Name"), and (B) all other tradenames, trademarks,
service marks, copyrights, licenses, proprietary rights and technology,
patents and registrations thereof or applications therefor, and trade
secrets, secret processes (whether or not patentable), supplies and
vendor lists, customer lists, software, inventions (whether or not
patentable), formulae
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and other property belonging to, used in or appertaining to the
Seller's Subject Assets, all as described on Exhibit 1.1(a)(v) hereto
(collectively, with the Name, the "Intellectual Property");
(vi) books, records, ledgers, files, documents,
correspondence, lists, prints, plans, drawings, and specifications,
creative materials, advertising and promotional materials, studies,
reports, and other printed or written materials directly related to
Seller's business other than Excluded Records (as defined in subsection
1.1(b)(ii) (the "Records");
(vii) all the Seller's federal, state and local governmental
permits, licenses, and approvals required for the conduct of its
business (or held with respect to the assets and operations of the
business of the Seller) to the extent assignment thereof to the
Purchaser is permitted by applicable law (the "Licenses"), all as
described on Exhibit 1.1(a)(vii) hereto; and
(viii) all the Seller's work-in-process; and
(ix) all accounts receivables owned by Seller at Closing.
(b) Excluded Assets. The assets to be purchased and sold hereunder, and
the term "Subject Assets" as used herein, shall not include the following assets
of the Seller existing on the Closing Date (the "Excluded Assets"):
(i) The Seller's cash balances as of Closing and any passive
investments of Seller as identified on Exhibit 1.1(b)(i).
(ii) The Seller's corporate minute books, stock records and
income tax records, and other records of the Seller relating
exclusively to Excluded Assets (the "Excluded Records"), however with
regard to tax return and financial statement information, Purchaser
shall have access to such information, including all accounting work
papers, for the last three (3) years to the extent the same are related
to the Seller's business being acquired hereunder as may be
periodically requested;
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(iii) The Seller's tax prepayments.
(iv) The personal property listed on Exhibit 1.1(b)(iv),
including Toyota Camry and Crown Victoria
vehicles presently owned by Seller.
Section 1.2 Closing Date. The closing date (the "Closing Date") shall
be November 9, 1998, or such other date as may be mutually agreed to by the
parties. The closing of this transaction (the "Closing") shall be held at the
offices of David M. Furr, Gray, Layton, Kersh, Solomon, Sigmon, Furr & Smith,
P.A., Gastonia, North Carolina, or such other place as the parties may mutually
agree. At the Closing, subject to the fulfillment or waiver of the conditions
set forth in Article V, the Seller shall convey the Subject Assets to the
Purchaser by appropriate instruments of transfer and the Purchaser shall pay to
the Seller the Purchase Price as provided in Sections 1.3 and 1.4.
Section 1.3 Purchase Price. The final purchase price after any working
capital adjustments to be paid to the Seller for the Subject Assets (the
"Purchase Price") shall be an amount equal to (i) One Million Seven Hundred
Fifty Thousand Dollars ($1,750,000.00) as set forth on Exhibit 1.3.
Section 1.4 Payment of Purchase Price. The Purchase Price shall be
payable by the Purchaser in cash or cash equivalent as well as stock in AASI at
Closing. The stock/cash allocation as well as the schedule of payment is set
forth on Exhibit "A" attached hereto and incorporated herein by reference. Any
stock received shall be subject to restraints on both timing and quantities of
shares to be sold as set forth on Exhibit "B".
Section 1.5 No Liabilities Assumed; Liabilities of the Purchaser After
Closing. The Purchaser is not assuming any of the Seller's liabilities or
obligations, whether known or unknown, contingent or realized, including the
Rose Company Limited Profit Guaranty Agreement, except as provided on Exhibit
1.5; provided, however, all liabilities incurred after the Closing in connection
with the Purchaser's operations after the Closing shall be liabilities of the
Purchaser.
Section 1.6 Allocation of Purchase Price. The Purchase
Price described in Section 1.3 above will be allocated among the
Subject Assets as described on Exhibit "A". The Purchaser and
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the Seller each agrees that it will adopt and utilize the amounts so allocated
for purposes of all federal, state and other tax returns filed by it and will
not voluntarily take any position inconsistent therewith upon examination of any
such tax return, in any claim, in any litigation or otherwise with respect to
such tax returns. Notwithstanding any other provisions of this Agreement, the
foregoing representation, warranty and agreement shall survive the Closing Date
without limitation.
Section 1.7 Status of Stock Issued. The shares of AASI stock to be
issued to the Seller will be "Restricted Stock" and will not have been
registered under the Securities Act of 1933, as amended, or under any laws of
any state, and will bear the following legend in addition to any other legends
required by state law or by other agreements executed contemporaneously
herewith:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "ACT") OR ANY STATE SECURITIES
ACT, AND ARE "RESTRICTED SECURITIES" WITHIN THE MEANING OF SUCH ACTS.
THE SHARES MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE
DISTRIBUTED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION UNDER SUCH ACTS
OR THE RECEIPT OF AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT
SUCH REGISTRATION IS NOT REQUIRED.
Section 1.8 Registration Rights. AASI shall file a Registration
Statement with the Securities and Exchange Commission registering the shares of
stock issued to the Seller upon request of the Seller after September 1, 1999,
and AASI shall use its best efforts to cause the Registration Statement to be
filed not more than six months after the date of such request and to become
effective as soon as practicable thereafter. Furthermore, Purchaser shall
maintain such effectiveness for a minimum period of one year. AASI shall pay all
expenses incident to such Registration Statement, except for any commissions or
taxes related to the sale of the shares thereunder. Such registration rights
shall be in accordance with, and subject to, the terms and provisions of the
form of Registration Rights Agreement attached as Exhibit B hereto. The
remaining shares shall have "piggy-back" rights, subject to the reasonable
approval of any managing underwriter, to be included in any Registration
Statement filed by Purchaser within one year as such registration statement
relates to an underwritten public offering of Purchaser's securities.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER AND SHAREHOLDERS
To induce the Purchaser and AASI to enter into this Agreement and to
purchase the Subject Assets, the Seller and Shareholders, jointly and severally,
represent and warrant that the statements contained in this Article II are
correct and complete as of the Closing Date, except as set forth in the
disclosure schedule accompanying this Agreement and initialed by the Parties
(the "Disclosure Schedule").
Section 2.1 Corporate Organization and Authority. The Seller is duly
organized and validly existing in good standing under the laws of the State of
Florida, with full power and authority to conduct its business as now conducted,
own its assets and enter into and perform its obligations under this Agreement.
The Seller's execution, delivery and performance of this Agreement and the sale
to the Purchaser of the Subject Assets have been duly authorized by all
requisite corporate action on the part of the Seller, and this Agreement
constitutes, and all bills of sale, assignments, agreements and other
instruments and documents to be executed and delivered by the Seller hereunder
will constitute, the Seller's legal, valid and binding obligations, enforceable
against the Seller in accordance with their respective terms.
Section 2.2 Title to Assets.
(a) Furniture, Equipment, Etc. The Seller has good and marketable title
to the Tangible Property free and clear of all liens, charges, security
interests, easements, reservations, restrictions, encumbrances and other defects
in title (collectively, "Encumbrances"), has the right to convey such Tangible
Property to the Purchaser, at the Closing shall have conveyed to the Purchaser
good and marketable title to such Tangible Property free and clear of all
Encumbrances, and will warrant and defend the title to such Tangible Property in
the Purchaser against the lawful claims of all persons whomsoever.
(b) Inventory. The Seller has good and marketable title to the
Inventory free and clear of all Encumbrances, has the right to convey such
Inventory to the Purchaser, at the Closing shall have conveyed to the Purchaser
good and marketable title to such Inventory free and clear of all Encumbrances
and will warrant and
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defend the title to such Inventory in Purchaser against the lawful claims of all
persons whomsoever. The level of Inventory at Closing will not exceed normal
inventory levels necessary to conduct the Seller's business in the ordinary
course of Seller's business.
(c) Intellectual Property. The Seller has rights to use the
Intellectual Property described on Exhibit 1.1(a)(v) in connection with its
business as and where now conducted and the use of the Intellectual Property by
the Seller in its business as and where now conducted does not violate or
infringe the rights of any other person, nor is the Seller a party to any
agreement with any other person or entity with respect to the use of the
Intellectual Property.
(d) Contracts. With respect to Seller's business, Exhibit 1.1(a)(iv)
lists the following contracts, agreements, and other written arrangements to
which the Seller is a party:
(i) any written arrangement (or group of related written
arrangements) for the lease of personal property from or to third
parties providing for lease payments;
(ii) any written arrangement (or group of related written
arrangements) for the purchase or sale of raw materials,
commodities, supplies, products, or other personal property or for
the furnishing or receipt of services;
(iii) any written arrangement concerning a partnership or joint
venture;
(iv) any written arrangement (or group of related written
arrangements) under which it has created, incurred, assumed, or
guaranteed (or may create, incur, assume, or guarantee)
indebtedness (including capitalized lease obligations) or under
which it has imposed (or may impose) a security interest on any of
its assets, tangible or intangible;
(v) any written arrangement concerning confidentiality or
competition;
(vi) any written arrangement involving any of the
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Seller's stockholders and its affiliates;
(vii) any written arrangement with any of its directors, officers,
and employees in the nature of a collective bargaining agreement,
employment agreement, or severance agreement;
(viii) to the Seller's knowledge, any written arrangement under
which the consequences of a default or termination could have an
adverse effect on the assets, liabilities, business, financial
condition, operations, results of operations, or future prospects
of Seller's business;
(ix) any agreement or contract carried-over from the corporation
that Seller bought in the Chapter 7 bankruptcy; or
(x) any other written arrangement (or group of related written
arrangements) either involving more than $5,000 or not entered into
in the ordinary course of business.
The Seller has delivered to the Purchaser a correct and complete copy
of each written arrangement listed in Exhibit 1.1(a)(iv). With respect to each
Contract: (i) the written arrangement is legal, valid, binding, enforceable, and
in full force and effect; (ii) the written arrangement will continue to be
legal, valid, binding, and enforceable and in full force and effect on identical
terms following the Closing; (iii) no party is in breach or default, and no
event has occurred which with notice or lapse of time would constitute a breach
or default or permit termination, modification, or acceleration, under the
written arrangement; and (iv) no party has repudiated any provision of the
written arrangement. The Seller is not a party to any verbal contract,
agreement, or other arrangement, which, if reduced to written form, would be
required to be listed in Exhibit 1.1(a)(iv) under terms of this Section 2.2(d).
The contracts and arrangements on Exhibit 1.1(a)(iv) constitute all of the
agreements, contracts, arrangements and rights necessary to conduct the Seller's
business as it is presently conducted and presently proposed to be conducted.
No filled customer order or commitment of the Seller's business
obligating the Seller to process, manufacture, or deliver products or perform
services will result in a loss to the
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Seller upon completion of performance. No purchase order or commitment of the
Seller with respect to Seller's business is in excess of normal requirements,
nor are prices provided therein in excess of current market prices for the
products or services to be provided thereunder. No supplier of the Seller has
indicated within the past year that, with respect to Seller's business, it will
stop, or decrease the rate of, supplying materials, products, or services to
them and no customer of the Seller has indicated within the past year that it
will stop, or decrease the rate of, buying materials, products, or services from
it.
(e) Software.
(i) Exhibit 2.2(e) sets forth an accurate and complete list and
summary description of all the software used in and related to
Seller's business ("Software"). The Software identified on Exhibit
2.2(e) is all the software necessary for the operation of Seller's
business as it is presently conducted and as presently proposed to
be conducted. Exhibit 2.2(e) identifies or describes (A) Software
which is owned by the Seller and (B) Software which is licensed to
the Seller by third parties. Each person who participated in the
development of Software owned by Seller has either so participated
as an employee of Seller or entered into a written agreement
assigning the copyright in such Software (including the related
documentation) to Seller. In each instance in which Seller is using
or has used Software, or a copy thereof, that it purchased or
licensed from a third party (other than word processing,
accounting, communications and similar business software that is
commercially available to any third party at a cumulative cost not
in excess of $5,000): (A) Seller has the perpetual, irrevocable,
transferable, worldwide right to use, copy, modify, prepare
derivatives of, sublicense, distribute and otherwise market each
Software; and (B) Seller has possession of and the right to use the
most current, fully documented source code version of such
Software.
(ii) Seller does not sell, license, sublicense or otherwise market
Software to third parties and has not entered into any Contract
that grants any third party a license or sublicense in Software.
Seller has not entered into any Contract, other than those
Contracts
<PAGE> 10
listed on Exhibit 2.2(e), that restricts Seller's use of Software
or that obligates Seller to maintain, enhance, protect or otherwise
take any action with respect to Software.
(iii) Except as is set forth in Exhibit 2.2(e), all Software that
Seller uses includes four digit format for the indication of the
relevant year and, at no additional costs to Purchaser, and without
human intervention, will correctly recognize and correctly process
data and formulas relating to the year 2000 and beyond and provide
all such date-related data and formulas used by other applications
in a format that will permit the correct recognition and processing
of data by the other applications.
(iv) Except as set forth in Exhibit 2.2(e), there are no defects or
errors in the Software, which defects or errors could materially
and adversely affect Purchaser's or any licensee's use of the
Software or the functioning of the Software in accordance with the
specifications for the Software.
(f) Real Property Leases. With respect to Seller's business, Exhibit
2.2(f) lists and describes briefly all real property leased or subleased to the
Seller. The Seller has delivered to the Purchaser correct and complete copies of
the leases and subleases listed in Exhibit 2.2(f). With respect to each lease
and sublease listed in Exhibit 2.2(f):
(i) the lease or sublease is legal, valid, binding, enforceable,
and in full force and effect;
(ii) the lease or sublease will continue to be legal, valid,
binding, enforceable, and in full force and effect on identical
terms following the Closing.
(iii) no party to the lease or sublease is in breach or default,
and no event has occurred which, with notice or lapse of time,
would constitute a breach or default or permit termination,
modification, or acceleration thereunder;
(iv) no party to the lease or sublease has repudiated any provision
thereof;
<PAGE> 11
(v) there are no disputes, oral agreements, or forbearance programs
in effect as to the lease or sublease;
(vi) with respect to each sublease, the representations and
warranties set forth in subsections (i) through (v) above are true
and correct with respect to the underlying lease;
(vii) the Seller has not assigned, transferred, conveyed,
mortgaged, deeded in trust, or encumbered any interest in the
leasehold or subleasehold; and
(viii) all facilities leased or subleased thereunder have received
all approvals of governmental authorities (including licenses and
permits) required in connection with the operation thereof and have
been operated and maintained in accordance with applicable laws,
rules, and regulations.
(g) Accounts Receivable. All accounts receivable of the Seller with
respect to Seller's business are reflected properly on its books and records,
are valid receivables subject to no setoffs or counterclaims, are presently
current and collectible, and will be collected in accordance with their terms at
their recorded amounts, subject only to the reserve for bad debts set forth on
the face of the October___, 1998 Balance Sheet as adjusted for the passage of
time in accordance with the past custom and practice of the Seller.
(h) Licenses. The parties acknowledge that Seller has applied for its
FAA certificate as an operational landing gear overhaul and repair facility and
that application is pending as of this date. Seller represents that it expects
to be a fully licensed and operational FAA repair station; however, the
application is pending approval by the FAA. Seller warrants that it will make
its best efforts to secure its repair station certificate as soon as is
possible. The parties further acknowledge that subsequent to the closing of the
instant agreement, Purchaser will be required, pursuant to 14 C.F.R. Section
145.15 to apply for an amended certificate pursuant to 14 C.F.R. Section 145.11.
Seller and its shareholders have no knowledge, after due investigation and
inquiry, that the FAA certificate stated above will fail to be granted before
January 31, 1999.
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Section 2.3 Leases. Except as set forth in Exhibit 2.3, none of the
Tangible Property is leased by the Seller from any other party. There is no
default under the leases described on Exhibit 2.3 and such leases are valid and
enforceable in accordance with their terms.
Section 2.4 Capital Expenditures. Except as described on Exhibit 2.4
hereto, there are no material capital expenditures which the Seller now
anticipates will be required to be made in connection with the Seller's business
as now conducted in order to operate the business or comply with any existing
laws, regulations or other governmental requirements applicable to the Seller's
business, including without limitation requirements relating to occupational
health and safety.
Section 2.5 Compliance with Law.
(a) Conduct of Business. The Seller has conducted its business so as to
comply with, and is in compliance with, all laws, statutes, regulations, rules
and other requirements of any governmental authority applicable to it, the
noncompliance with which curing thereof could have a material adverse effect on
the Seller or its business or the Subject Assets.
(b) Pending or Threatened Litigation. Except as described in Exhibit
2.5(b), the Seller is not a party to any claim, action, suit or other proceeding
pending, or to the knowledge of the Seller threatened, before any court, agency
or other judicial, administrative or other governmental body or arbitrator.
(c) Investigations. Exhibit 2.5(c) describes all investigations of the
Seller or the Seller's business known to the Seller conducted by any grand jury,
administrative agency or other governmental authority, and describes all
inspection reports, questionnaires, inquiries, demands, requests for information
and claims of violations or noncompliance with law received by the Seller from
any governmental authority and all written statements or responses of the Seller
with respect thereto, including requests for information from the Internal
Revenue Service or any state department of revenue in connection with audits of
the Seller's income, sales, and use tax returns or routine questionnaires and
requests for information received generally by others in the Seller's industry.
<PAGE> 13
(d) Judgments and Orders. Except as described in Exhibit 2.5(d), there
are no outstanding judgments, tax liens, orders, writs or decrees of any
judicial or other governmental authority binding specifically upon the Seller or
the Subject Assets and not of general application, other than judgments, orders,
writs and decrees with which the Seller has complied and which have no future
applicability.
Section 2.6 Environmental Matters.
(a) Except as described in Exhibit 2.6, the Seller and the property
owned or used in its business are, and at all times have been, in compliance
with all applicable Federal, state and local statutes, laws, ordinances,
regulations and codes related in any way to Hazardous Materials (as hereinafter
defined) and underground storage tanks. As used herein, Hazardous Materials
shall mean solid waste (as that term is defined in the Resource Conservation and
Recovery Act, 42 U.S.C.A. Section 6901, et seq, and the regulations adopted
pursuant thereto), hazardous substances (as that term is defined in the
Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C.A.
Section 9601, et seq, and the regulations adopted pursuant thereto), and other
pollutants, including, without limitation, any solid, liquid, gaseous or thermal
irritant or contaminant, such as smoke, vapor, soot, fumes, acids, alkaloids or
chemicals.
Seller represents and warrants to Purchaser that (i) to the best
knowledge of Seller, any handling, transportation, storage, treatment or use of
Toxic or Hazardous Substances that has occurred on the property owned or used in
its business to date has been in compliance with all applicable federal, state,
and local laws, regulations and ordinances, and (ii) to the best knowledge of
Seller, no leak, spill, release, discharge, emission or disposal of Toxic or
Hazardous Substances has occurred on the property owned or used in its business
to date and the soil, groundwater, and soil vapor on or under the property owned
or used in its business is free of Toxic or Hazardous Substances as of the date
of this Agreement. Seller shall be responsible for any required cleanup or
liability brought about by actions or inactions of any parties prior to the date
of this Agreement of the property owned or used in its business. A Limited Phase
II Environmental Assessment was conducted on the property owned or used in its
business on June 17, 1998. Seller has provided Purchaser with the Limited Phase
II Environmental Assessment Report dated June 17, 1998. Seller had any and all
recommended
<PAGE> 14
cleanups recommended by the Limited Phase II Environmental Assessment Report
performed prior to the date of this Agreement on the property owned or used in
its business.
(b) Except as described in Exhibit 2.6, during Seller's occupancy of
the property used in its business, no Hazardous Materials have been generated,
treated, stored or disposed of at, or transported to or from, the Seller or the
property owned or used in the Seller's business at any time.
(c) Except as described in Exhibit 2.6, no asbestos or materials
containing asbestos have been installed, used, treated, stored or disposed of by
the Seller in or on property owned or used by the Seller at any time.
(d) Except as described in Exhibit 2.6, during Seller's occupancy of
the property used in its business, no polychlorinated biphenyls are located on
or in the facilities of the Seller or any property owned or used by the Seller
at any time.
(e) Except as described in Exhibit 2.6, the Seller holds all necessary
permits or licenses to enable it to comply with all statutes, laws, ordinances,
regulations and codes related in any way to Hazardous Materials or underground
storage tanks.
(f) Except as described in Exhibit 2.6, no notice has been served on
the Seller or any of its directors, officers or shareholders from any entity,
governmental body or individual claiming violation of any statute, law,
ordinance, regulation or code related in any way to Hazardous Materials or
underground storage tanks, requiring compliance with any statute, law,
ordinance, regulation or code related in any way to Hazardous Materials or
underground storage tanks, or demanding payment of or contributions for damage
regarding the Seller or property owned or used by the Seller related in any way
to Hazardous Materials or underground storage tanks, including without
limitation, damages to the environment or natural resources.
Section 2.7 Employee Relations.
(a) Employee Census. Seller has furnished an accurate employee census,
detailing the Employee's date of hire, salary, benefits and other pertinent
information (attached hereto as Exhibit 2.7). There shall have been no increase
in any
<PAGE> 15
compensation paid or payable to the employees of Seller unless otherwise
disclosed on Exhibit 2.7 and agreed to by Purchaser.
(b) No Contracts or Future Contracts. To the best of Seller's
knowledge, Seller has no employment contracts in its current operation that
cannot be terminated without liability and further, Seller will not contact any
Employees to work for Seller after closing without first obtaining Purchaser's
written permission.
Section 2.8 Taxes
(a) Returns and Payment of Taxes. All tax returns required to be filed
on or prior to the Closing Date by the Seller with all taxing authorities have
been or prior to the Closing Date will have been filed; and all taxes shown to
be due and payable on such returns, all other taxes, duties and other
governmental charges payable by the Seller and for the payment of which there
may arise any lien upon the Subject Assets sold hereunder subsequent to such
sale, and all deficiencies, assessments, penalties and interest with respect
thereto, notice of which has been received by the Seller, in each case due and
payable on or before the Closing Date, have been or prior to the Closing Date
will have been paid.
(b) Withholding of Taxes. There has been withheld or collected from
each payment made to each employee of the Seller the amount of all taxes
(including without limitation federal income taxes, Federal Insurance
Contributions Act taxes, and state and local income, payroll and wage taxes)
required to be withheld or collected therefrom and the same have been paid to
the proper tax depositories or collecting authorities.
(c) Ad Valorem and Sales Taxes. All ad valorem property taxes for 1998
and all years prior to 1998 imposed on the Seller with respect to, or which may
become a lien on, the Subject Assets have been paid in full. Certain assets
being conveyed under this Agreement were acquired by Seller from the Chapter 7
bankruptcy of Aviation Accessory & Instrument Overhaul Corporation. Case No.
97-15426-BKC-AJC pending in the United States District Court for the Southern
District of Florida ("the AAIOC Bankruptcy"). Said assets may potentially be
subject to a sales tax obligation payable to the Florida Department of Revenue.
Seller is contesting both the taxability of the acquisition of the assets from
the AAIOC Bankruptcy and the
<PAGE> 16
amount of taxes being sought by the Florida Department of Revenue. In the event
that the acquisition of the assets acquired from the AAIOC Bankruptcy is
determined to constitute a taxable event, Seller shall pay and discharge said
tax obligation. Seller further agrees to hold harmless Purchaser with respect to
any and all such tax obligations.
Section 2.9 No Material Misstatements or Omissions. To the best of its
knowledge, the representations and warranties of the Seller in this Agreement do
not contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements made therein not misleading.
Section 2.10 No Sale of Assets, Etc. Seller has not sold or otherwise
disposed of any of the assets other than sales of inventory in the ordinary
course of business. In addition, Seller has, from the date hereof until Closing,
maintained the reputation of the business being sold hereunder and preserved the
goodwill of suppliers, customers and others having business relationships with
Seller.
Section 2.11 Product Warranty. With respect to Seller's business, each
service provided, overhauled parts and other parts and products manufactured,
sold, leased, or delivered by the Seller has been in conformity with all
applicable contractual commitments and all express and implied warranties, and,
with respect to Seller's business, the Seller has no liability (and to Seller's
knowledge there is no present or future charge, complaint, action, suit,
proceeding, hearing, investigation, claim, or demand against any service,
overhauled parts or other parts and products giving rise to any liability) for
replacement or repair thereof or other damages in connection therewith, except
as is disclosed in Exhibit 2.11. With respect to Seller's business, no service,
overhauled parts or other parts and products manufactured, sold, leased, or
delivered by the Seller is subject to any guaranty, warranty, or other indemnity
beyond the applicable standard terms and conditions of sale or lease. With
respect to Seller's business, Exhibit 2.11 includes copies of the standard
invoices (containing terms and conditions of services provided, terms and
conditions of sale or lease, applicable guaranty, warranty, and indemnity
provisions). No product warranty claims have been assumed from the previous
business Seller acquired in the Chapter 11 bankruptcy.
Section 2.12 Product Liability; Product Safety. Except as
<PAGE> 17
set forth on Exhibit 2.12, the Seller has no liability (and to Seller's
knowledge there is no present of future charge, complaint, action, suit,
proceeding, hearing, investigation, claim, or demand against Seller giving rise
to any liability) arising out of any injury to persons or property as a result
of a service performed by Seller or as a result of the ownership, possession, or
use of any overhauled part or other parts and products manufactured, sold,
leased, or delivered by the Seller. Seller has at all times maintained insurance
coverage for product liability in such amounts and against such risks and losses
as are adequate and customary for Seller's business.
The Seller has not been required to file any notification or other
report with or to provide information to any product safety agency, commission,
board or other governmental authority of any jurisdiction concerning actual or
potential hazards with respect to any service Seller has provided or with
respect to any overhauled parts or other parts and products manufactured or sold
by Seller. Each service performed by Seller, overhauled part and other parts and
products manufactured, distributed or sold by Seller complies in all material
respects of all product safety standards or each applicable product safety
agency, commission, board or other governmental authority. The Seller has not
made any misrepresentation or furnished any information containing any material
omission to any products safety testing laboratory or a similar organization.
The Seller has not failed to obtain approval of any product, component or
process which is used, manufactured or licensed by the Seller in the conduct of
its business which is legally required to be approved by any independent or
government-sponsored testing laboratory, industry, trade association or similar
body agency or association.
Section 2.13 Insurance. Exhibit 2.13 lists all policies of insurance
owned by the Seller and now in effect insuring all its business, assets and
personnel, and sets forth for such policy the name of the insurer, the type of
coverage, the amount of coverage, the term thereof and the annual premium.
Section 2.14 Good Title. Seller has good and marketable title to all
assets Seller acquired in the Chapter 7 bankruptcy,free and clear from all
liens, charges, security interests, encumbrances and claims and has the right to
convey such assets to the Purchaser and will warrant and defend the title to
such assets in the Purchaser against the lawful claims of all persons whosoever.
<PAGE> 18
Section 2.15 Other Representations and Warranties of Seller and
Shareholders.
(a) Knowledge Respecting Purchaser and AASI. Seller and Shareholders
(i) know or have had the opportunity to acquire all information concerning the
business affairs, financial condition, plans and prospects of Purchaser and AASI
that they deem relevant to make a fully informed decision respecting the
acquisition of the stock; (ii) have been encouraged and have had the opportunity
to rely upon the advice of their legal counsel and accountants and other
advisers with respect to the acquisition of the stock; and (iii) have had the
opportunity to ask such questions and receive such answers and information
respecting, among other things, the business, affairs, financial condition,
plans and prospects of Purchaser and AASI and the terms and conditions of the
acquisition of the stock as they have requested so as to more fully understand
their investment.
(b) Absence of Representations and Warranties. Seller and Shareholders
confirm that neither Purchaser and AASI nor anyone purportedly acting on behalf
of Purchaser and AASI has made any representations, warranties, agreements or
statements other than those contained herein respecting the business, affairs,
financial condition, plans or prospects of Purchaser and AASI nor have Seller
and Shareholders relied on any representations, warranties, agreements or
statements in the belief that they were made on behalf of the foregoing nor has
Seller or Shareholders relied on the absence of any such representations,
warranties, agreements or statements in reaching their decision to acquire the
stock.
(c) No Distribution. Seller and Shareholders are acquiring the stock
for their own account without a view to public distribution or resale, and they
have no contract, undertaking, agreement or arrangement to transfer, sell or
otherwise dispose of any of the stock or any interest therein to any other
person, including Shareholders. Further, Seller and Shareholders agree that they
shall make no attempted sales or transfers of any of the AASI stock prior to
October 1, 1999.
(d) Shares to be Restricted. Seller and Shareholders understand that
the stock will remain "restricted securities" within the meaning of Rule 144
under the Securities Act of 1933, as amended (the "1933 Act").
<PAGE> 19
(e) No Registration. Seller and Shareholders understand that the stock
will not be registered under the 1933 Act, state law and the securities laws of
any other jurisdiction and must be held indefinitely without any transfer, sale
or other disposition unless the stock is subsequently registered under the 1933
Act, state law and the securities laws of any other applicable jurisdictions
pursuant to any attaching "piggy-back" rights or, in the opinion of counsel for
Purchaser, registration is not required under such Acts or laws as the result of
an available exemption.
(f) Legend of Certificates. Seller and Shareholders understand that
there shall be endorsed on the certificates evidencing the stock a legend
substantially to the following effect:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") OR ANY
STATE SECURITIES ACT, AND ARE "RESTRICTED SECURITIES" WITHIN THE
MEANING OF SUCH ACTS. THE SHARES MAY NOT BE SOLD, TRANSFERRED,
HYPOTHECATED OR OTHERWISE DISTRIBUTED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION UNDER SUCH ACTS OR THE RECEIPT OF AN OPINION
OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
REQUIRED."
(g) Restrictions on Other Securities. Seller and Shareholders
understand that, except upon certain limited circumstances, the restrictions on
the sale, transfer and disposition of the stock will also apply to any and all
shares of capital stock or other securities issued or otherwise acquired with
respect to the stock including, without limitation, shares and securities issued
or acquired as a result of any stock dividend, stock split or exchange or any
distribution of shares or securities pursuant to any corporate reorganization,
reclassification or similar event.
(h) Stop Orders. Seller and Shareholders understand that Purchaser and
AASI and its transfer agent may refuse to effect a transfer, sale or other
disposition of any of the stock by Seller or Shareholders' or their successors
or assigns otherwise than as contemplated hereby.
(i) No Governmental Approval. Seller and Shareholders
understand that no federal or state agency has approved or
<PAGE> 20
disapproved the stock, passed upon or endorsed the merits of the offering of the
stock, or made any finding or determination as to the fairness of the stock for
investment.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND AASI
To induce the Seller to enter into this Agreement and to sell the
Subject Assets, the Purchaser and AASI hereby represent and warrant that the
statements contained in this Article III are correct and complete as of the
Closing Date, except as set forth in the Disclosure Schedule.
Section 3.1 Corporate Organization and Authority. The Purchaser and
AASI are corporations duly organized and validly existing and in good standing
under the laws of the jurisdiction of their incorporation, with full corporate
power and authority to conduct its business as now conducted and to enter into
and perform its obligations under this Agreement. The Purchaser's and AASI's
execution, delivery and performance of this Agreement and its acquisition of and
payment for the Subject Assets have been duly authorized by all requisite
corporate action on the part of the Purchaser and AASI, and this Agreement
constitutes, and all agreements and other instruments and documents to be
executed and delivered by the Purchaser and AASI hereunder will constitute, the
Purchaser's and AASI's legal, valid and binding obligations, enforceable against
the Purchaser and AASI in accordance with their terms.
Section 3.2 Absence of Conflicts and Consent Requirements. The
Purchaser's and AASI's execution and delivery of this Agreement and performance
of its obligations hereunder, including the purchase of and payment for the
Subject Assets hereunder, do not and will not conflict with, violate or result
in any default under the Purchaser's or AASI's Articles of Incorporation or
Bylaws or any mortgage, indenture, agreement, instrument or other contract to
which the Purchaser or AASI is a party or by any judgment, order, decree, law,
statute, regulation or other judicial or governmental restriction to which the
Purchaser and AASI are subject. The Purchaser's and AASI's execution and
delivery of this Agreement and performance of its obligations hereunder,
including the purchase of and payment for the Subject Assets, do not and will
not require the consent of, or any prior filing with or notice to, any
governmental authority or other third party.
<PAGE> 21
Section 3.3 No Material Misstatements or Omissions. The representations
and warranties of the Purchaser and AASI in this Agreement do not contain any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements made therein not misleading.
ARTICLE IV
CERTAIN COVENANTS AND AGREEMENTS
Section 4.1 Change of the Seller's Name. Promptly after the Closing,
and in no event later than thirty (30) days following the Closing, the Seller
will take all action necessary to discontinue use of the Name and to enable the
Purchaser exclusively to use the Name, and at the Closing shall deliver to the
Purchaser all documents necessary to accomplish the foregoing. Seller may remain
in existence for the sole purpose of completing the liquidation and distribution
of the assets of Seller for up to six (6) years. Shareholders will not operate
under any corporate entity in any type of aviation or aviation parts business.
Section 4.2 Further Assurances. The Seller, the Shareholders and the
Purchaser each hereby covenants and agrees with the other that at any time and
from time to time each will promptly execute and deliver to the other such
further assurances, instruments and documents and take such further action as
the other may reasonably request in order to carry out the full intent and
purpose of this Agreement.
Section 4.3 Fees and Expenses. The Seller, the Shareholders and the
Purchaser shall each bear their own expenses in connection with the negotiation
and preparation of this Agreement and their consummation of the transactions
contemplated hereby, including without limitation the fees and expenses of their
respective counsel, accountants and consultants.
Section 4.4 No Brokers. The Seller and the Purchaser each represent and
warrant to the other that no broker or finder has been involved or engaged by it
in connection with the transactions contemplated hereby, and each hereby agrees
to indemnify and save harmless the other from and against any and all broker's
or finder's fees, commissions or similar charges incurred or alleged to have
been incurred by the indemnifying party in connection with
<PAGE> 22
the transactions contemplated hereby and any and all loss, liability, cost or
expense (including reasonable attorneys' fees) arising out of any claim that the
indemnifying party incurred any such fees, commissions or charges.
Section 4.5 Bulk Transfer Compliance. Inasmuch as the Seller has agreed
to duly pay, perform and discharge the Excluded Liabilities and Obligations, the
Purchaser and the Seller hereby mutually agree to waive compliance with the
provisions of the Florida Bulk Sales laws and of the corresponding laws of any
other jurisdiction, to the extent applicable to the transactions contemplated
hereby. The Seller covenants and agrees to indemnify and save harmless the
Purchaser from and against any and all loss, liability, cost and expense
(including reasonable attorneys' fees) arising out of noncompliance with said
Bulk Transfers.
ARTICLE V
CONDITIONS TO CLOSING
Section 5.1 Conditions to the Purchaser's Obligations. The obligations
of the Purchaser and AASI to complete the Closing are contingent upon the
fulfillment of each of the following conditions on or before the Closing Date,
except to the extent that the Purchaser may, in its absolute discretion, waive
any one or more thereof in whole or in part:
(a) Instruments of Transfer. The Seller shall have delivered to the
Purchaser such assignments, bills of sale, deeds, certificates of title and
other instruments of transfer, all in form reasonably satisfactory to the
Purchaser, as are necessary to fully and effectively convey to the Purchaser all
of the Subject Assets in accordance with the terms hereof and shall have
executed the Consignment Agreement.
(b) Consents. The consents, if any, described in the Exhibits hereto,
and all other consents, if any, required for the Seller to perform its
obligations hereunder, shall have been obtained in form reasonably satisfactory
to the Purchaser. If the parties mutually agree and Seller can provide full
authority for the following, Seller shall provide the means by which Purchaser
can operate legally under FAA the license and repair tag of Seller (which is
presently pending FAA approval) for an interim period until such time as
Purchaser applies for and obtains an amended FAA repair station certificate
pursuant to 14 C.F.R. Sections 145.11 and 145.15.
<PAGE> 23
(c) No Material Adverse Change. On the date of Closing, there shall not
have occurred any event or condition materially and adversely affecting the
financial condition, results of operations or business prospects of the Seller
except for matters resulting from adverse changes in economic conditions
affecting businesses generally.
(d) No Adverse Proceedings. No action, suit or proceeding before any
court or any governmental or regulatory authority shall have been commenced, no
investigation by any governmental or regulatory authority shall have been
commenced, and no action, suit or proceeding by any governmental or regulatory
authority shall have been threatened against any of the parties to this
Agreement, or any of the principals, officers or directors of any of them, or
any of the Subject Assets seeking to restrain, prevent or change the
transactions contemplated hereby or questioning the validity or legality of any
of such transactions or seeking damages in connection with any of such
transactions.
(e) Other Assurances. The Seller shall have delivered to the Purchaser
such other and further certificates, assurances and documents as the Purchaser
or AASI may reasonably request in order to evidence the accuracy of the Seller's
representations and warranties, the performance of its covenants and agreements
to be performed at or prior to the Closing, and the fulfillment of the
conditions to the Purchaser's obligations.
(f) Lease of Facilities. Purchaser and Condor Properties of Miami, Inc.
shall enter into leases for the facilities in which Seller's business is
presently located (the "Leases").
(g) Director and Shareholder Approval. All necessary director and
shareholder approval shall be given by Seller. A legal opinion shall be given by
counsel to the Seller as to this provision.
(h) Opinion of Seller's Counsel. The Purchaser shall have received from
counsel for the Seller an opinion dated as of the date of Closing in form and
substance satisfactory to the Purchaser and its counsel, to the effect that:
(i) when executed and delivered by the Seller, the agreement will
be valid and binding on it and
<PAGE> 24
Shareholders, enforceable in accordance with its terms, except to
the extent limited by bankruptcy, insolvency, reorganization and
other laws affecting creditors' rights generally, and except that
the remedy of specific enforcement or similar equitable relief is
available only at the discretion of the court before which
enforcement is sought;
(ii) except as set forth in Exhibits to this Agreement, such
counsel does not know of any suit, action, arbitration, or legal,
administrative or other proceeding or governmental investigation
pending against or affecting the Seller, or its business or
properties;
(iii) neither the execution and delivery of this Agreement nor the
consummation of the transaction contemplated in this Agreement will
constitute a default, or an event that would with notice or lapse
of time or both constitute a default under, or violation or breach,
the Articles of Incorporation, or By-laws of the Seller or any
material contracts of the Seller, except as otherwise disclosed in
such opinion letter or an exhibit hereto;
(iv) Seller has good and marketable title to the Subject Assets
transferred hereunder, free and clear of all liens, charges,
security interests, encumbrances and other defects in title, has
the right to convey such property to the Purchaser, and, at the
Closing, shall have conveyed to the Purchaser good and marketable
title to such property free from all Encumbrances;
(v) Seller has good and marketable title to all assets Seller
acquired in the Chapter 7 bankruptcy, free and clear from all
liens, charges, security interests, encumbrances, claims and other
defects in title, has the right to convey such assets to Purchaser,
and, at the Closing, shall have conveyed to Purchaser good and
marketable title to such assets; and
(vi) Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Florida, and the
execution of this Agreement has been duly authorized by all
necessary corporate, director and shareholder, action.
<PAGE> 25
Section 5.2 Conditions to the Seller's Obligations. The obligations of
the Seller to complete the Closing are contingent upon the fulfillment of each
of the following conditions on or before the Closing Date, except to the extent
that the Seller may, in its absolute discretion, waive any one or more thereof
in whole or in part:
(a) Payment of Purchase Price and Delivery of Stock. The Purchaser
shall have paid to the Seller the Purchase Price and delivered the stock.
(b) Employment Agreement. Purchaser shall enter into employment
agreements with Ned Angene and Martin Washofsky substantially in the form of
Exhibit 5.2(b) hereto, which shall also contain an executive incentive plan with
Ned Angene and Martin Washofsky.
(c) No Adverse Proceedings. No action, suit or proceeding before any
court or any governmental or regulatory authority shall have been commenced, no
investigation by any governmental or regulatory authority shall have been
commenced, and no action, suit or proceeding by any governmental or regulatory
authority shall have been threatened, against any of the parties to this
Agreement, or any of the principals, officers or directors of any of them, or
any of the Subject Assets, seeking to restrain, prevent or change the
transactions contemplated hereunder or questioning the validity or legality of
any of such transactions or seeking damages in connection with any of such
transactions.
(d) Other Assurances. The Purchaser shall have delivered to the Seller
such other and further certificates, assurances and documents as the Seller may
reasonably request in order to evidence the accuracy of the Purchaser's
representations and warranties, the performance of its covenants and agreements
to be performed at or prior to the Closing, and the fulfillment of the
conditions to the Seller's obligations.
(e) Director Approval. The Agreement shall have been approved by the
Directors of the Purchaser.
(f) Opinion of the Purchaser's Counsel. The Purchaser shall have
furnished the Seller with an opinion, dated the date of Closing, of Gray,
Layton, Kersh, Solomon, Sigmon, Furr & Smith, P.A., counsel for the Purchaser
and AASI, in form and substance satisfactory to the Seller and its counsel, to
the effect that:
<PAGE> 26
(i) the Purchaser and AASI are corporations duly organized, validly
existing and in good standing under the laws of the State of
Florida and Delaware respectively and have all requisite power and
authority to execute and deliver this Agreement and to perform
their obligations under this Agreement;
(ii) all corporate or other proceedings required by law, the
Articles of Incorporation and By-laws of Purchaser and AASI or by
the provisions of this Agreement to be taken by the Purchaser and
AASI on or before the date of Closing, in connection with the
authorization, execution and delivery of this Agreement and the
consummation of the transaction contemplated by this Agreement,
have been duly and validly taken; and
(iii) the Purchaser and AASI have the legal power and authority to
consummate this transaction.
ARTICLE VI
INDEMNIFICATION
Section 6.1 Indemnification by the Seller and Shareholders. Subject to
the procedures and limitations set forth in this Article VI, the Seller and
Shareholders, jointly and severally, hereby agree to indemnify and save harmless
the Purchaser from and against any and all liabilities, losses, claims,
judgments, damages, expenses and costs (including, without limitation reasonable
counsel fees and costs and expenses incurred in connection therewith) (a "Loss")
incurred by the Purchaser arising after the Closing out of any of the following:
(a) Breach of Warranty. The falsity or incorrectness of any
representation or warranty made by the Seller or Shareholders in this Agreement
or in any instrument or document delivered by the Seller or Shareholders to the
Purchaser pursuant to this Agreement;
(b) Breach of Covenants. The Seller's failure to duly perform any
covenant or agreement to be performed by it under this Agreement or under any
instrument or document delivered by the Seller to the Purchaser pursuant to this
Agreement;
(c) Claims Against Subject Assets. Any levy or other claim by any third
party against or with respect to the Subject Assets, or
<PAGE> 27
any other claim by any third party against the Purchaser, arising out of any act
or omission or alleged act or omission of the Seller or Shareholders prior to
the Closing.
The Purchaser shall have the right to be put in the same financial
position as it would have been in had each of the representations and warranties
of the Seller and Shareholders been true and correct or had the Seller or
Shareholders not breached any representations, warranties, covenants or
agreements.
Section 6.2 Survival of the Seller's and Shareholders' Warranties. The
representations and warranties of the Seller and Shareholders made in this
Agreement or in any instrument or document delivered by the Seller or
Shareholders to the Purchaser pursuant to this Agreement shall survive the
Closing.
Section 6.3 Indemnification by the Purchaser. After the Closing, the
Purchaser agrees that it will indemnify and save harmless the Seller from and
against any and all loss, liability, damages, cost or expense (including
reasonable attorneys' fees) incurred by the Seller (net of any benefits to the
Seller) arising out of the Purchaser's breach of any of its representations,
warranties, covenants and agreements in this Agreement or in any document
delivered by the Purchaser to the Seller hereunder.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Merger Clause. This Agreement contains the final, complete
and exclusive statement of the agreement between the parties with respect to the
transactions contemplated herein and all prior or contemporaneous written or
oral agreements with respect to the subject matter hereof are merged herein.
Section 7.2 Amendments. No change, amendment, qualification or
cancellation hereof shall be effective unless in writing and executed by each of
the parties hereto by their duly authorized officers.
Section 7.3 Press Releases and Announcements. No party shall issue any
press release or announcement relating to the subject matter of this Agreement
prior to the Closing without the prior written approval of the other party;
provided, however, that any party may make any public disclosure it believes in
good faith is
<PAGE> 28
required by law or regulation (in which case the disclosing party will advise
the other party prior to making the disclosure).
Section 7.4 Benefits and Binding Effect. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors, transferees and assigns.
Section 7.5 Notices. All notices, requests and demands and other
communications hereunder must be in writing and shall be deemed to have been
duly given when (i) personally delivered, (ii) when forwarded by Federal
Express, Airborne or another private carrier which maintains records showing
delivery information, (iii) when sent via facsimile transmission but only if a
written or facsimile acknowledge of receipt is received by the sending party, or
(iv) when placed in the United States Mails and forwarded by Registered or
Certified Mail, return receipt requested, postage prepaid, addressed to the
party to whom such notice is being given at the following addresses:
AS TO THE SELLER: Condor Flight Spares, Inc
Attn: Ned Angene
6929 NW 46 Street
Miami, Florida 33166
WITH A COPY TO: Christopher J. Dawes
Haley, Sinagra & Perez, P.A.
100 South Biscayne Blvd., Suite 800
Miami, FL 33131
AS TO THE PURCHASER: American Aircarriers Support,
Incorporated
Attn: Karl F. Brown
P. O. Box 7566
Charlotte, NC 28241
WITH COPY TO: David M. Furr
Gray, Layton, Kersh, Solomon,
Sigmon, Furr & Smith, P.A.
P. O. Box 2636
Gastonia, NC 28053-2636
Any party may change the address(es) to which notices to it are to be sent by
giving notice of such change to the other parties in
<PAGE> 29
accordance with this Section.
Section 7.6 Captions. The captions are for convenience of
reference only and shall not be construed as a part of this
Agreement.
Section 7.7 Governing Law. This Agreement shall be
construed, interpreted, enforced and governed by and under the laws
of the State of Florida.
Section 7.8 Exhibits. All of the Exhibits hereto referred to in this
Agreement are hereby incorporated herein by reference and shall be deemed and
construed to be a part of this Agreement for all purposes.
Section 7.9 Severability. The invalidity or unenforceability of any one
or more phrases, sentences, clauses or provisions of this Agreement shall not
affect the validity or enforceability of the remaining portions of this
Agreement or any part thereof.
Section 7.10 Counterparts. This Agreement may be executed in
any number of counterparts, all of which shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the Seller and the Purchaser have each caused this
Agreement to be executed by their respective duly authorized officers under
seal, all as of the day and year first above written.
SELLER:
ATTEST: CONDOR FLIGHT SPARES, INC.
/s/ Martin Washofsky By /s/ Ned Angene
- ------------------------------- --------------------------------------
Secretary President
/s/ Ned Angene (SEAL)
----------------------------
Ned Angene
/s/ Martin Washofsky (SEAL)
----------------------------
Martin Washofsky
<PAGE> 30
PURCHASER:
AMERICAN AIRCARRIERS SUPPORT, ATTEST:
ACQUISITION III CORP.
/s/ David M. Furr By /s/ Karl F. Brown
- ---------------------------------- ----------------------------------------
Secretary President
AMERICAN AIRCARRIERS SUPPORT, ATTEST:
INCORPORATED
s/ David M. Furr By /s/ Karl F. Brown
- ---------------------------------- ----------------------------------------
Secretary President
<PAGE> 1
EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT dated as of November 9, 1998 by and
among AMERICAN AIRCARRIERS SUPPORT, INCORPORATED, a Delaware corporation (the
"Company") and CONDOR FLIGHT SPARES, INC. ("Holder").
The parties agree as follows:
SECTION 1. DEFINITIONS. For purposes of this Agreement:
(a) "Common Stock" means the Company's Common Stock, $.001 par
value;
(b) "Registrable Securities" means 125,000 shares of Common
Stock to be issued to the Holder upon closing of that certain Asset
Purchase Agreement of even date (the "Agreement"; certain terms not
defined herein but used herein are used as defined in the Agreement);
(c) "register" and "registration" refer to a registration of
the Registrable Securities effected by filing a registration statement
or similar document pursuant to the Securities Act of 1933, as amended
(the "Act") and the declaring or ordering of effectiveness of such
registration statement; and
(d) The "Company" means American Aircarriers Support,
Incorporated, a Delaware corporation.
(e) "Holder" means Condor Flight Spares, Inc. or any
shareholder thereof who shall receive the shares by permittable
transfer or assignment.
SECTION 2. DEMAND REGISTRATION.
(a) If at any time after September 1, 1999 the Company receives
a written request from the Holder that the Company file a registration
statement under the Act covering the registration of Registrable
Securities held by them, then the Company shall, subject to the
limitations of this Section 2, use its best efforts to, within six
months of the date of such request, effect the registration under the
Act of all Registrable Securities and will keep such
<PAGE> 2
registration statement effective for a minimum period of 12 months
thereafter. The Company shall be obligated to effect only one (1)
registration pursuant to this Section 2(a).
(b) If the Holder intends to distribute the Registrable
Securities covered by their request by means of an underwriting, they
shall so advise the Company as a part of their request made pursuant to
this Section 2. The Holder shall (together with the Company as provided
in Section 3) enter into an underwriting agreement in customary form
with a mutually acceptable underwriter or underwriters.
SECTION 3. "PIGGYBACK" RIGHTS. For a period of one (1) year from
November 9, 1998, and if (but without any obligation to do so) the Company
proposes to register any of its securities under the Act in connection with a
public offering of such common stock for cash proceeds payable in whole or in
part to the Company (other than with respect to a Registration Statement filed
on Form S-8 or Form S-4 or such other similar form then in effect under the
Securities Act), the Company shall, at such time, subject to the provisions of
Section 6 and 7 hereof and upon request of the Holder cause to be registered
under the Act all of the Registrable Securities which the Holder requests be
registered; provided, however, if the managing underwriter of the public
offering of shares proposed to be registered by the Company advises the Holder
in writing that marketing factors require a limitation of the number of shares
to be underwritten, then the number of shares of Registrable Securities of the
Holder that may be included in the underwriting shall be so limited prorata.
Such "piggyback rights" shall expire on the registration and sale of the
Registrable Securities pursuant to Section 2 above or upon the sale of the
Registrable Securities hereunder, but in no event later than November 9, 1999.
SECTION 4. REGISTRATION PROCEDURE. Whenever required under
this Agreement to effect the registration of any Registrable
Securities, the Company shall, as expeditiously as is reasonably
possible:
(a) Furnish to the Holder of the Registrable Securities covered
by such registration statement such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements
of the Act, and such other documents as they may reasonably request in
order to facilitate the disposition of the Registrable
<PAGE> 3
Securities owned by them.
(b) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in
usual and customary form, with the managing underwriter of such
offering. The Holder participating in such underwriting shall also
enter into and perform their obligations under such agreement.
(c) Notify the Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto
covered by such registration statement is required to be delivered
under the Act, of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances
then existing.
SECTION 5. FURNISH INFORMATION. The Holder shall promptly furnish
to the Company in writing such reasonable information regarding the Holder, the
Registrable Securities held by the Holder, and the intended method of
disposition of such securities as shall be required to effect the registration
of their Registrable Securities.
SECTION 6. EXPENSES OF REGISTRATION. All of the foregoing expenses
relating to the Registrable Securities incurred in connection with registration,
filing or qualification pursuant to this Agreement, including (without
limitation) all registration, filing and qualification fees, printers' bills,
mailing and delivery expenses, accounting fees, and the fees and disbursements
of counsel for the Company, but excluding underwriting discounts or fees, shall
be borne by the Company.
SECTION 7. INDEMNIFICATION AND CONTRIBUTION. In the event any
Registrable Securities are included in a registration statement under this
Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless the Holder, the officers and directors of each
Holder, any underwriter (as defined in the Act) for such holder, and
each person, if any, who controls such Holder or underwriter within the
meaning of the Act or
<PAGE> 4
the Securities Exchange Act of 1934 (the "Exchange Act"), against any
losses, claims, damages, or liabilities (joint or several) to which
they may become subject under the Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereto) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and the Company will reimburse each such
Holder, officer or director, underwriter or controlling person for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability, or
action; provided however, that the indemnity agreement contained in
this Section 7(a) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability, or action if such settlement is
effected without the consent of the Company (which consent shall not be
unreasonably withheld), nor shall the Company be liable in any such
case for any such loss, claim, damage, liability, or action to the
extent that it arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, preliminary prospectus or final prospectus or
any amendment or supplement thereto in reliance upon and in conformity
with written information furnished expressly for use in connection with
such registration by any such Holder, underwriter or controlling
person; provided, further, however, that if any losses, claims, damages
or liabilities arise out of or are based upon any untrue statement,
alleged untrue statement, omission or alleged omission contained in any
preliminary prospectus, and made in reliance upon and in conformity
with written information furnished by such Holder expressly for use
therein, which did not appear in the final prospectus, the Company
shall not have any such liability with respect thereto to such Holder,
any person who controls such Holder within the meaning of the Act, or
any director of such Holder, if such Holder delivered a copy of the
preliminary prospectus to the person alleging such losses, claims,
damages or liabilities and failed to deliver a copy of the
<PAGE> 5
final prospectus, as amended or supplemented if it has been amended or
supplemented, to such person at or prior to the written confirmation of
the sale to such person, provided that such Holder had an obligation to
deliver a copy of the final prospectus to such person; and
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of
its officers who has signed the registration statement, each person, if
any, who controls the Company within the meaning of the Act, any
underwriter and any other Holder selling securities in such
registration statement or any of its directors or officers or any
person who controls such Holder or underwriter against any losses,
claims, damages or liabilities, joint or several) to which the Company
or any such director, officers, controlling person, or underwriter or
controlling person, or other such Holder or director, officer or
controlling person may become subject, under the Act, the Exchange Act
or other federal or state law, insofar as such losses, claims, damages
or liabilities (or actions in respect thereto) arise out of or are
based upon any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, if the untrue statement or omission or alleged
untrue statement or omission in respect of which such loss, claim,
damage or liability is asserted was made in reliance upon and in
conformity with written information furnished by such Holder expressly
for use in connection with such registration; and each such Holder will
reimburse any legal or other expenses reasonably incurred by the
Company or any such director, officer, controlling person, underwriter
or controlling person, or other Holder, officer, director, or
controlling person in connection with investigating or defending any
such loss, claim, damage, liability or action; provided however, that
the indemnity agreement contained in this Section 7(b) shall not apply
to amounts paid in settlement of any such loss, claim, damage,
liability or action, if such settlement is effected without the consent
of the Holder (which consent shall not be unreasonably withheld);
provided, further that
<PAGE> 6
the maximum liability of any selling Holder under this Section 7(b) in
regard to any registration statement shall in no event exceed the
amount of the proceeds received by such selling Holder from the sale of
securities under such registration statement; provided, further
however, that if any losses, claims, damages or liabilities arise out
of or are based upon an untrue statement, alleged untrue statement,
omission or alleged omission contained in any preliminary prospectus
which did not appear in the final prospectus, such seller shall not
have any such liability with respect thereto to the Company, any person
who controls the Company within the meaning of the Act, any officer of
the Company who signed the registration statement or any director of
the Company, if the Company delivered a copy of the preliminary
prospectus to the person alleging such losses, claims, damages or
liabilities and failed to deliver a copy of the final prospectus, as
amended or supplemented if it has been amended or supplemented, to such
person at or prior to the written confirmation of the sale to such
person, provided that the Company had an obligation to deliver a copy
of the final prospectus to such person.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this
Section 7, deliver to the indemnifying party a written notice of the
commencement thereof, and the indemnifying party shall have the right
to participate in and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly notified, to assume
the defense thereof with counsel mutually satisfactory to the parties.
An indemnified party shall have the right to retain its own counsel,
however, the fees and expenses of such counsel shall be at the expense
of the indemnified party, unless (i) the employment of such counsel has
been specifically authorized in writing by the indemnifying party, (ii)
the indemnifying party has failed to assume the defense and employ
counsel, or (iii) the named parties to any such action (including any
impleaded parties) include both the indemnified party and the
indemnifying party, and the indemnified party shall have been advised
by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to
<PAGE> 7
the indemnifying party (in which case the indemnifying party shall not
have the right to assume the defense of such action on behalf of such
indemnified parry, it being understood, however, that the indemnifying
party shall not, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable
for the reasonable fees and expenses of more than one separate firm of
attorneys for all indemnified parties). The failure to deliver written
notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party under this Agreement.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party in
respect of any losses, claims, damages or liabilities or actions in
respect thereof referred to therein, then each indemnifying party shall
in lieu of; indemnifying such indemnified party contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages, liabilities or actions in such proportion as
is appropriate to reflect the relative fault of the Company, on the one
hand, and selling Holder, on the other, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or actions as well as any other relevant equitable
considerations, including the failure to give any required notice. The
relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to
information supplied by the Company, on the one hand, or by such
selling Holder on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto acknowledge and agree
that it would not be just and equitable if contribution pursuant to
this subparagraph (d) were determined by prorata allocation (even if
all of the selling Holder were treated as one entity for such purpose)
or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subparagraph (d).
The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or actions in respect thereof
referred
<PAGE> 8
to above in this subparagraph (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subparagraph (d), the amount the
selling Holder shall be required to contribute shall not exceed the
amount, if any, by which the total price at which the securities sold
by each of them were offered to the public exceeds the amount of any
damages which they would have otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged
omission, or other violation of law. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of
fraudulent misrepresentation
SECTION 8. MISCELLANEOUS.
(a) Binding Effect. This Agreement shall be binding upon and
shall inure to the benefit of the Company and to the Holder and their
respective heirs, personal representatives, successors and assigns.
(b) Notices. Except as otherwise provided herein, any notice,
consent or request to be given in connection with any term or provision
of this Agreement shall be deemed to have been given sufficiently if
sent by hand, registered or certified mail, postage prepaid, facsimile
transmission or courier (next day delivery), to the Company or to the
Holder at their respective addresses as provided on or about the date
hereof.
(c) Integration. This Agreement contains the entire agreement
between the parties with respect to the transactions contemplated
hereby and no party shall be bound by, nor shall any party be deemed to
have made, any covenants, representations, warranties undertakings or
agreements except those contained in such entire Agreement. The section
and paragraph headings contained in this Agreement are for the
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(d) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to
<PAGE> 9
be an original, but all of which together shall constitute
one and the same agreement.
(e) Amendment. This Agreement may be amended, changed, waived
or terminated only in writing signed by each of the parties.
IN WITNESS WHEREOf, this Agreement has been executed effective as of
the date first above written.
AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED
By /s/ Karl F. Brown
----------------------------------
President
CONDOR FLIGHT SPARES, INC.
By /s/ Ned Angene
----------------------------------
President
<PAGE> 1
EXHIBIT 10.1.4
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT effective November 9, 1998 (the
"Agreement") by and between AMERICAN AIRCARRIERS SUPPORT, INCORPORATED (the
"Company") with principal offices at Fort Mill, South Carolina and NED ANGENE
(the "Executive").
NOW THEREFORE, in consideration of the foregoing premises and mutual
covenants herein contained, the parties hereto agree as follows:
1. Employment. The Company agrees to employ the Executive
and the Executive agrees to serve the Company as its President in
a newly formed subsidiary.
2. Position and Responsibilities. The Executive shall exert his best
efforts and devote full time and attention to the affairs of the Company.
Executive shall have no ownership in or operate any other active closely-held
corporation or business entity in the aviation or aviation parts business. The
Executive shall have the authority and responsibility given by the general
direction, approval and control of the Board of Directors, President and Chief
Executive Officer of the Company, to the restrictions, limitations and
guidelines set forth by the Board of Directors in resolutions adopted in the
minutes of the Board of Directors meetings, copies of which will be provided to
the Executive from time to time and will be incorporated herein by reference.
3. Term of Employment. The term of the Executive's employment under
this Agreement shall be deemed to have commenced on November 9, 1998 and shall
continue until November 8, 2003, (the "Initial Term"), subject to extension as
hereinafter provided or termination pursuant to the provisions set forth
hereafter. Provided that Executive is in compliance with all of his obligations
hereunder, the term of Executive's employment shall be automatically extended
for an additional one-year term upon expiration of the Initial Term unless
either party hereto receives 30 days' prior written notice from the other
electing not to extend the Executive's employment. Compensation during the term
shall be that set forth in Section 5 hereof, unless one of the termination
provisions overrides.
<PAGE> 2
2
4. Duties. During the period of his employment hereunder and except
for illness, specified vacation periods and reasonable leaves of absence, the
Executive shall devote his best efforts and full attention and skill to the
business and affairs of the Company and its affiliated companies, as such
business and affairs now exist and as they may be hereinafter changed or added
to, under and pursuant to the general direction of the Board of Directors of the
Company.
5. Compensation. Commencing on November 9, 1998, the Company shall
pay to the Executive as compensation for his services the sum of $180,000.00 per
year, payable semi-monthly. Base compensation shall be reviewed annually by the
Compensation Committee of the Company. Executive shall also be eligible to
receive up to $50,000 per year in an executive bonus pool beginning in 2004
should his contract be extended which shall be administered at the sole
discretion of the Compensation Committee of the Company.
6. Executive's Incentive Pay. In addition to the compensation set
forth in Section 5 hereof, an incentive bonus pool shall be paid annually for
five (5) years (excluding the remaining partial 1998 calendar year) based on the
profitability of the subsidiary (holding the assets purchased from Condor Flight
Spares, Inc. and which shall operate the landing gear repair facility) and the
effective management of this subsidiary ("Incentive Pay"), provided Executive is
employed by the Company. The incentive bonus pool shall be split 60% and 40%
between Executive and Martin Washofsky, respectively. The Incentive Pay shall be
equal to sixteen and one-tenth percent (16.1%) of the Excess Operating Income,
as defined below.
Excess Operating Income is equal to the operating income (before
goodwill and the Incentive Pay) less taxes less the Charge on Invested Capital.
The Charge on Invested Capital is Invested Capital times the Cost of Capital
(which has been agreed to be fifteen percent (15%)). Invested Capital is defined
as the total of all operating assets (excluding cash and goodwill) less all
trade liabilities. Using projections, below is an example of how the Incentive
Pay will be computed and paid to Executive and Martin Washofsky, pursuant to
their respective percentages:
<PAGE> 3
3
<TABLE>
<S> <C>
Operating Income (before
goodwill and incentive) $ 927,000
Income Taxes (40% assumed) 371,000
----------
After Tax Operating Income $ 556,000
Invested Capital (Net cash
and goodwill) $2,836,000
Cost of Capital 15.00%
----------
Charge on Invested Capital $ 425,000
----------
Excess Operating Income $ 131,000
Incentive Percentage 16.10%
Incentive Pay $ 21,091
</TABLE>
This incentive bonus pool shall end at the conclusion of the fifth (5th) full
year. Each year shall stand on its own. Payment of the incentive bonus shall
occur within ten (10) business days of the Company reporting its final audited
numbers. In the event that a dispute shall arise with regard to the above
definitions, then any dispute shall be mediated by an independent Certified
Public Accountant of the parties choice who shall apply generally accepted
accounting principles (GAAP) to the unresolved issue.
7. Expense Reimbursement. The Company will reimburse the Executive,
at least semi-monthly, for all reasonable and necessary expenses, including
without limitation, travel expenses, and reasonable entertainment expenses,
incurred by him in carrying out his duties under this Agreement. The Executive
shall present to the Company each month an account of such expenses in such form
as is reasonably required by the Board of Directors.
8. Medical and Dental Coverage. Commencing November 9, 1998, the
Executive will be entitled to participate in the Company's employee group
medical and other group insurance programs on the same basis as other executives
of the Company. Currently, only Executive's (excluding spouse and dependents are
paid by the Company and Executive shall receive this method of coverage unless
better company executive coverage is effected.
9. Medical Examination. The Executive agrees to submit himself for
physical examination on one occasion per year as requested by the Company for
the purpose of the Company's obtaining
<PAGE> 4
4
life insurance on the life of the Executive for the benefit of the Company as
may be required; provided, however, that the Company shall bear the entire cost
of such examinations and shall pay all premiums on any key man life insurance
obtained for the benefit of the Company as beneficiary or with respect to any
other designated beneficiary.
10. Vacation Time. The Executive shall be entitled each year to a
reasonable vacation in accordance with the established practices of the Company,
now or hereafter in effect for the executive personnel, during which time the
Executive's compensation shall be paid in full.
11. Benefits Payable on Disability. If the Executive becomes disabled
such that he is unable to properly perform services hereunder by reason of
illness or other physical or mental incapacity, the Company shall continue to
pay the Executive his then current salary hereunder for the first three (3)
months of such continuous disability commencing with the first date of such
disability.
12. Obligations of Executive During and After Employment.
(a) The Executive agrees that during the terms of his
employment under this Agreement, he will engage in no other business
activities directly or indirectly, which are competitive with or which
might place him in a competing position to that of the Company, or any
affiliated company.
(b) The Executive realizes that during the course of his
employment, Executive will have produced and/or have access to
confidential business plans, information, business opportunity records,
notebooks, data, formula, specifications, trade secrets, customer
lists, account lists and secret inventions and processes of the Company
and its affiliated companies. Therefore, during or subsequent to his
employment by the Company, or by an affiliated company, the Executive
agrees to hold in confidence and not to directly or indirectly disclose
or use or copy or make lists of any such information, except to the
extent authorized by the Company in writing. All records, files,
business plans, documents, equipment and the like, or copies thereof,
relating to Company's business, or the business of an affiliated
company, which Executive shall
<PAGE> 5
5
prepare, or use, or come into contact with, shall remain the sole
property of the Company, or of an affiliated company, and shall not be
removed from the Company's or the affiliated company's premises without
its written consent, and shall be promptly returned to the Company upon
termination of employment with the Company and its affiliated
companies. The restrictions and obligations of Executive set forth in
this Section 12(b) shall not apply to (i) information that is or
becomes generally available and known to the industry (other than as a
result of a disclosure directly or indirectly by Executive); or (ii)
information that was known to Executive prior to Executive's employment
by the Company or its predecessor.
(c) Because of his employment by the Company, Executive shall
have access to trade secrets and confidential information about the
Company, its business plans, its business accounts, its business
opportunities, its expansion plans into other geographical areas and
its methods of doing business. Executive agrees that for a period of
two (2) years after termination or expiration of his employment, he
will not, directly or indirectly, compete with the Company in its then
present business or anticipated lines in the aviation business.
Further, for the same two (2) year period, Executive shall not hire or
entice to hire any employees of Company to any other business Executive
may pursue following termination or expiration of employment.
(d) In the event a court of competent jurisdiction finds any
provision of this Section 12 to be so overbroad as to be unenforceable,
then such provision shall be reduced in scope by the court, but only to
the extent deemed necessary by the court to render the provision
reasonable and enforceable, it being the Executive's intention to
provide the Company with the broadest protection possible against
harmful competition.
13. Termination for Cause by the Company. The Company may, without
liability, terminate the Executive's employment hereunder for cause at any time
upon written notice from the Board of Directors specifying such cause, and
thereafter the Company's obligations hereunder shall cease and terminate;
provided, however, that such written notice shall not be delivered until after
the Board of Directors shall have given the Executive written notice
<PAGE> 6
6
specifying the conduct alleged to have constituted such cause and the Executive
has failed to cure such conduct, if curable, within fifteen (15) days following
receipt of such notice.
Grounds for termination "for cause" are one or more of the following:
(a) A willful breach of a material duty by the Executive
during the course of his employment;
(b) Habitual neglect of a material duty by the Executive;
(c) Action or inaction by the Executive which places the
Company in circumstances of financial peril;
(d) Fraud on the Company or conviction of a felony involving
or against the Company; and
(e) Ownership or operation of any other closely-held
corporation or business entity actively engaged in the aviation or
aviation parts business. Notwithstanding the foregoing, Executive may
(i) continue to own the corporate entity that was Condor Flight Spares,
Inc. until such time as it may reasonably be dissolved and provided
that it as well as any other entity in which Executive may have
ownership has no activity of any sort in the aviation or aviation parts
business; and (ii) conclude any transaction to which the Company is a
party.
(f) Failure of Executive to obtain before January 31, 1999 an
FAA certificate for the AASI subsidiary as an operational landing gear
overhaul and repair facility.
14. Termination by the Executive or the Company Without Cause.
(a) The Executive, without cause, may terminate this Agreement
upon 90 days prior written notice to the Company. In such event, the
Executive shall be required to render the services required under this
Agreement during such 90-day period unless otherwise directed by the
Board of Directors. Compensation for vacation time not taken by
Executive shall be
<PAGE> 7
7
paid to the Executive at the date of termination. Executive shall be
paid for only the ninety (90) day period pursuant to normal pay
practices and then all obligations hereunder regarding compensation in
any form shall cease.
(b) The Company, without cause, may terminate this Agreement.
In such event, the Company shall pay a severance allowance equal to
one-half (1/2) of Executive's then current salary each year for a two
(2) year period at the regularly scheduled pay arrangements. No other
benefits will be provided once this Agreement is terminated and all
other obligations hereunder regarding compensation in any form shall
cease.
(c) The severance pay referenced in Section 14(b) shall also
be payable to the Executive in the event that Company declines to renew
or extend this Agreement pursuant to Section (3) supra. In that event
and provided the noncompete provisions of this Agreement apply, then
Company shall pay a severance allowance equal to one-half (1/2) of
Executive's then current salary each year for a two (2) year period at
the regularly scheduled pay arrangements.
15. Termination upon Death of Executive. In addition to any other
provision relating to the termination, this Agreement shall terminate upon the
Executive's death. In such event, the Company shall pay a severance allowance
equal to one hundred eighty (180) days' salary to the Executive's estate, which
may be covered by an insurance policy.
16. Arbitration. Any controversy, dispute or claim arising out of, or
relating to, this Agreement and/or its interpretation shall, unless resolved by
agreement of the parties, be settled by binding arbitration in Charlotte, North
Carolina in accordance with the Rules of the American Arbitration Association
then existing. This Agreement to arbitrate shall be specifically enforceable
under the prevailing arbitration law of the State of South Carolina. The award
rendered by the arbitrators shall be final and judgment may be entered upon the
award in any court of the State of South Carolina having jurisdiction of the
matter.
<PAGE> 8
8
17. General Provisions.
(a) The Executive's rights and obligations under this
Agreement shall not be transferrable by assignment or otherwise, nor
shall Executive's rights be subject to encumbrance or to the claims of
the Company's creditors. Nothing in this Agreement shall prevent the
consolidation of the Company with, or its merger into, any other
corporation, or the sale by the Company of all or substantially all of
its property or assets.
(b) This Agreement and the rights of Executive with respect to
the benefits of employment referred to herein constitute the entire
Agreement between the parties hereto in respect of the employment of
the Executive by the Company and supersede any and all other agreements
either oral or in writing between the parties hereto with respect to
the employment of the Executive.
(c) The provisions of this Agreement shall be regarded as
divisible, and if any of said provisions or any part thereof are
declared invalid or unenforceable by a court of competent jurisdiction
or in an arbitration proceeding, the validity and enforceability of the
remainder of such provisions or parts thereof and the applicability
thereof shall not be affected thereby.
(d) This Agreement may not be amended or modified except by a
written instrument executed by Company and Executive.
(e) This Agreement and the rights and obligations hereunder
shall be governed by and construed in accordance with the laws of the
State of South Carolina.
18. Construction. Throughout this Agreement the singular shall
include the plural, and the plural shall include the singular, and the masculine
and neuter shall include the feminine, wherever the context so requires.
19. Text to Control. The headings of paragraphs and sections are
included solely for convenience of reference. If any conflict between any
heading and the text of this Agreement exists, the text shall control.
<PAGE> 9
9
20. Authority. The officer executing this agreement on behalf of
the Company has been empowered and directed to do so by the Board of Directors
of the Company.
21. Effective Date. This Agreement shall be effective on as of the
date cited above.
FOR THE COMPANY: AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED
Dated November 9, 1998 By /s/ Karl F. Brown
---------------------- ---------------------------------
Title: President
-----------------------------
FOR THE EXECUTIVE:
Dated November 9, 1998 /s/ Ned Angene (SEAL)
---------------------- -----------------------------
NED ANGENE
<PAGE> 1
EXHIBIT 10.1.5
EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT effective November 9, 1998 (the
"Agreement") by and between AMERICAN AIRCARRIERS SUPPORT, INCORPORATED (the
"Company") with principal offices at Fort Mill, South Carolina and MARTIN
WASHOFSKY (the "Executive").
NOW THEREFORE, in consideration of the foregoing premises and mutual
covenants herein contained, the parties hereto agree as follows:
1. Employment. The Company agrees to employ the Executive and the
Executive agrees to serve the Company as its Executive Vice President, Head of
Sales, in a newly formed subsidiary.
2. Position and Responsibilities. The Executive shall exert his
best efforts and devote full time and attention to the affairs of the Company,
other than for the sporadic wrap-up of his old accounting business. Executive
shall have no ownership in or operate any other active closely-held corporation
or business entity in the aviation or aviation parts business. The Executive
shall have the authority and responsibility given by the general direction,
approval and control of the Board of Directors, President and Chief Executive
Officer of the Company, to the restrictions, limitations and guidelines set
forth by the Board of Directors in resolutions adopted in the minutes of the
Board of Directors meetings, copies of which will be provided to the Executive
from time to time and will be incorporated herein by reference.
3. Term of Employment. The term of the Executive's employment under
this Agreement shall be deemed to have commenced on November 9, 1998 and shall
continue until November 8, 2003 (the "Initial Term"), subject to extension as
hereinafter provided or termination pursuant to the provisions set forth
hereafter. Provided that Executive is in compliance with all of his obligations
hereunder, the term of Executive's employment shall be automatically extended
for an additional one-year term upon expiration of the Initial Term unless
either party hereto receives 30 days' prior written notice from the other
electing not to extend the Executive's employment. Compensation during the term
shall be that set forth in Section 5 hereof, unless one of the termination
provisions overrides.
<PAGE> 2
2
4. Duties. During the period of his employment hereunder and except
for illness, specified vacation periods and reasonable leaves of absence, the
Executive shall devote his best efforts and full attention and skill to the
business and affairs of the Company and its affiliated companies, as such
business and affairs now exist and as they may be hereinafter changed or added
to, under and pursuant to the general direction of the Board of Directors of the
Company.
5. Compensation. Commencing on November 9, 1998, the Company shall
pay to the Executive as compensation for his services the sum of $150,000.00 per
year, payable semi-monthly. Base compensation shall be reviewed annually by the
Compensation Committee of the Company. Executive shall also be eligible to
receive up to $50,000 per year in an executive bonus pool beginning in 2004
should his contract be extended, which shall be administered at the sole
discretion of the Compensation Committee of the Company.
6. Executive's Incentive Pay. In addition to the compensation set
forth in Section 5 hereof, an incentive bonus pool shall be paid annually for
five (5) years (excluding the remaining partial 1998 calendar year) based on the
profitability of the subsidiary (holding the assets purchased from Condor Flight
Spares, Inc. and which shall operate the landing gear repair facility) and the
effective management of this subsidiary ("Incentive Pay"). The incentive bonus
pool shall be split 40% and 60% between Executive and Ned Angene, respectively.
The Incentive Pay shall be equal to sixteen and one-tenth percent (16.1%) of the
Excess Operating Income, as defined below.
Excess Operating Income is equal to the operating income (before
goodwill and the Incentive Pay) less taxes less the Charge on Invested Capital.
The Charge on Invested Capital is Invested Capital times the Cost of Capital
(which has been agreed to be fifteen percent (15%)). Invested Capital is defined
as the total of all operating assets (excluding cash and goodwill) less all
trade liabilities. Using projections, below is an example of how the Incentive
Pay will be computed and paid to Executive and Ned Angene, pursuant to their
respective percentages:
<PAGE> 3
3
<TABLE>
<S> <C>
Operating Income (before
goodwill and incentive) $ 927,000
Income Taxes (40% assumed) 371,000
----------
After Tax Operating Income $ 556,000
Invested Capital (Net cash
and goodwill) $2,836,000
Cost of Capital 15.00%
----------
Charge on Invested Capital $ 425,000
----------
Excess Operating Income $ 131,000
Incentive Percentage 16.10%
----------
Incentive Pay $ 21,091
</TABLE>
This incentive bonus pool shall end at the conclusion of the fifth (5th) year.
Each year shall stand on its own. Payment of the incentive bonus shall occur
within ten (10) business days of the Company reporting its final audited
numbers. In the event that a dispute shall arise with regard to the above
definitions, then any dispute shall be mediated by an independent Certified
Public Accountant of the parties choice who shall apply generally accepted
accounting principles (GAAP) to the unresolved issue.
7. Expense Reimbursement. The Company will reimburse the Executive,
at least semi-monthly, for all reasonable and necessary expenses, including
without limitation, travel expenses, and reasonable entertainment expenses,
incurred by him in carrying out his duties under this Agreement. The Executive
shall present to the Company each month an account of such expenses in such form
as is reasonably required by the Board of Directors.
8. Medical and Dental Coverage. Commencing November 9, 1998, the
Executive will be entitled to participate in the Company's employee group
medical and other group insurance programs on the same basis as other executives
of the Company. Currently, only Executive's (excluding spouse and dependents are
paid by the Company and Executive shall receive this method of coverage unless
better company executive coverage is effected.
9. Medical Examination. The Executive agrees to submit himself for
physical examination on one occasion per year as requested by the Company for
the purpose of the Company's obtaining
<PAGE> 4
4
life insurance on the life of the Executive for the benefit of the Company as
may be required; provided, however, that the Company shall bear the entire cost
of such examinations and shall pay all premiums on any key man life insurance
obtained for the benefit of the Company as beneficiary or with respect to any
other designated beneficiary.
10. Vacation Time. The Executive shall be entitled each year to a
reasonable vacation in accordance with the established practices of the Company,
now or hereafter in effect for the executive personnel, during which time the
Executive's compensation shall be paid in full.
11. Benefits Payable on Disability. If the Executive becomes
disabled such that he is unable to properly perform services hereunder by reason
of illness or other physical or mental incapacity, the Company shall continue to
pay the Executive his then current salary hereunder for the first three (3)
months of such continuous disability commencing with the first date of such
disability.
12. Obligations of Executive During and After Employment.
(a) The Executive agrees that during the terms of his
employment under this Agreement, he will engage in no other business
activities directly or indirectly, which are competitive with or which
might place him in a competing position to that of the Company, or any
affiliated company.
(b) The Executive realizes that during the course of his
employment, Executive will have produced and/or have access to
confidential business plans, information, business opportunity records,
notebooks, data, formula, specifications, trade secrets, customer
lists, account lists and secret inventions and processes of the Company
and its affiliated companies. Therefore, during or subsequent to his
employment by the Company, or by an affiliated company, the Executive
agrees to hold in confidence and not to directly or indirectly disclose
or use or copy or make lists of any such information, except to the
extent authorized by the Company in writing. All records, files,
business plans, documents, equipment and the like, or copies thereof,
relating to Company's business, or the business of an affiliated
company, which Executive shall
<PAGE> 5
5
prepare, or use, or come into contact with, shall remain the sole
property of the Company, or of an affiliated company, and shall not be
removed from the Company's or the affiliated company's premises without
its written consent, and shall be promptly returned to the Company upon
termination of employment with the Company and its affiliated
companies. The restrictions and obligations of Executive set forth in
this Section 12(b) shall not apply to (i) information that is or
becomes generally available and known to the industry (other than as a
result of a disclosure directly or indirectly by Executive); or (ii)
information that was known to Executive prior to Executive's employment
by the Company or its predecessor.
(c) Because of his employment by the Company, Executive
shall have access to trade secrets and confidential information about
the Company, its business plans, its business accounts, its business
opportunities, its expansion plans into other geographical areas and
its methods of doing business. Executive agrees that for a period of
two (2) years after termination or expiration of his employment, he
will not, directly or indirectly, compete with the Company in its then
present business or anticipated lines in the aviation business.
Further, for the same two (2) year period, Executive shall not hire or
entice to hire any employees of Company to any other business Executive
may pursue following termination or expiration of employment.
(d) In the event a court of competent jurisdiction finds any
provision of this Section 12 to be so overbroad as to be unenforceable,
then such provision shall be reduced in scope by the court, but only to
the extent deemed necessary by the court to render the provision
reasonable and enforceable, it being the Executive's intention to
provide the Company with the broadest protection possible against
harmful competition.
13. Termination for Cause by the Company. The Company may, without
liability, terminate the Executive's employment hereunder for cause at any time
upon written notice from the Board of Directors specifying such cause, and
thereafter the Company's obligations hereunder shall cease and terminate;
provided, however, that such written notice shall not be delivered until after
the Board of Directors shall have given the Executive written notice
<PAGE> 6
6
specifying the conduct alleged to have constituted such cause and the Executive
has failed to cure such conduct, if curable, within fifteen (15) days following
receipt of such notice.
Grounds for termination "for cause" are one or more of the following:
(a) A willful breach of a material duty by the Executive
during the course of his employment;
(b) Habitual neglect of a material duty by the Executive;
(c) Action or inaction by the Executive which places the
Company in circumstances of financial peril;
(d) Fraud on the Company or conviction of a felony involving
or against the Company; and
(e) Ownership or operation of any other closely-held
corporation or business entity actively engaged in the aviation or
aviation parts business. Notwithstanding the foregoing, Executive may
(i) continue to own the corporate entity that was Condor Flight Spares,
Inc. until such time as it may reasonably be dissolved and provided
that it as well as any other entity in which Executive may have
ownership has no activity of any sort in the aviation or aviation parts
business; and (ii) conclude any transaction to which the Company is a
party.
(f) Failure of Executive to obtain before January 31, 1999
an FAA certificate for the AASI subsidiary as an operational landing
gear overhaul and repair facility.
14. Termination by the Executive or the Company Without Cause.
(a) The Executive, without cause, may terminate this
Agreement upon 90 days prior written notice to the Company. In such
event, the Executive shall be required to render the services required
under this Agreement during such 90-day period unless otherwise
directed by the Board of Directors. Compensation for vacation time not
taken by Executive shall be
<PAGE> 7
7
paid to the Executive at the date of termination. Executive shall be
paid for only the ninety (90) day period pursuant to normal pay
practices and then all obligations regarding pay shall cease.
(b) The Company, without cause, may terminate this
Agreement. In such event, the Company shall pay a severance allowance
equal to one-half (1/2) of Executive's then current salary each year
for a two (2) year period at the regularly scheduled pay arrangements.
No other benefits will be provided once this Agreement is terminated
and all other obligations hereunder regarding compensation in any form
shall cease.
(c) The severance pay referenced in Section 14(b) shall also
be payable to the Executive in the event that Company declines to renew
or extend this Agreement pursuant to Section (3) supra. In that event
and provided the noncompete provisions of this Agreement apply, then
Company shall pay a severance allowance equal to one-half (1/2) of
Executive's then current salary each year for a two (2) year period at
the regularly scheduled pay arrangements.
15. Termination upon Death of Executive. In addition to any other
provision relating to the termination, this Agreement shall terminate upon the
Executive's death. In such event, the Company shall pay a severance allowance
equal to one hundred eighty (180) days' salary to the Executive's estate, which
may be covered by an insurance policy.
16. Arbitration. Any controversy, dispute or claim arising out of,
or relating to, this Agreement and/or its interpretation shall, unless resolved
by agreement of the parties, be settled by binding arbitration in Charlotte,
North Carolina in accordance with the Rules of the American Arbitration
Association then existing. This Agreement to arbitrate shall be specifically
enforceable under the prevailing arbitration law of the State of South Carolina.
The award rendered by the arbitrators shall be final and judgment may be entered
upon the award in any court of the State of South Carolina having jurisdiction
of the matter.
17. General Provisions.
<PAGE> 8
8
(a) The Executive's rights and obligations under this
Agreement shall not be transferrable by assignment or otherwise, nor
shall Executive's rights be subject to encumbrance or to the claims of
the Company's creditors. Nothing in this Agreement shall prevent the
consolidation of the Company with, or its merger into, any other
corporation, or the sale by the Company of all or substantially all of
its property or assets.
(b) This Agreement and the rights of Executive with respect
to the benefits of employment referred to herein constitute the entire
Agreement between the parties hereto in respect of the employment of
the Executive by the Company and supersede any and all other agreements
either oral or in writing between the parties hereto with respect to
the employment of the Executive.
(c) The provisions of this Agreement shall be regarded as
divisible, and if any of said provisions or any part thereof are
declared invalid or unenforceable by a court of competent jurisdiction
or in an arbitration proceeding, the validity and enforceability of the
remainder of such provisions or parts thereof and the applicability
thereof shall not be affected thereby.
(d) This Agreement may not be amended or modified except by
a written instrument executed by Company and Executive.
(e) This Agreement and the rights and obligations hereunder
shall be governed by and construed in accordance with the laws of the
State of South Carolina.
18. Construction. Throughout this Agreement the singular shall
include the plural, and the plural shall include the singular, and the masculine
and neuter shall include the feminine, wherever the context so requires.
19. Text to Control. The headings of paragraphs and sections are
included solely for convenience of reference. If any conflict between any
heading and the text of this Agreement exists, the text shall control.
<PAGE> 9
9
20. Authority. The officer executing this agreement on behalf of the
Company has been empowered and directed to do so by the Board of Directors of
the Company.
21. Effective Date. This Agreement shall be effective as of the date
cited above.
FOR THE COMPANY: AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED
Dated November 9, 1998 By /s/ Karl F. Brown
------------------- -----------------------------
Title: President
-------------------------
FOR THE EXECUTIVE:
Dated November 9, 1998 /s/ Martin Washofsky (SEAL)
------------------- -------------------------------
MARTIN WASHOFSKY
<PAGE> 1
EXHIBIT 10.5.3
STATE OF FLORIDA
COUNTY OF MIAMI-DADE LEASE OF REAL PROPERTY
THIS AGREEMENT, executed the 9th day of November, 1998, by and between
CONDOR PROPERTIES OF MIAMI, INC., hereinafter referred to as "Lessor", and
AMERICAN AIRCARRIERS SUPPORT, INCORPORATED, a Delaware corporation, hereinafter
referred to as "Lessee";
W I T N E S S E T H
WHEREAS, Lessor owns certain realty suitable for leasing;
WHEREAS, Lessee is desirous of leasing said realty to utilize in its
business of maintaining, overhauling, supplying and redistributing aircraft
landing gear and associated parts to commercial and cargo airlines;
NOW, THEREFORE, in consideration of and subject to the premises, the
mutual covenants herein contained, and each and every act performed hereunder
by all of the parties, such parties enter into the following Articles of
Agreement:
ARTICLE I
THE DEMISED PREMISES AND THE TERM
Section 1.01 - Demised Premises. Lessor hereby warrants that it is the
owner of that certain realty which Lessor lets and demises to Lessee, and the
Lessee leases from Lessor. Said real estate, located at 6929 NW 46 Street,
Miami, Florida 33166, is more particularly described in Exhibit "A" annexed
hereto and is hereinafter designated and referred to as "Demised Premises".
Section 1.02 - Title. Lessor warrants that it has a merchantable fee
simple title in and to the Demised Premises free and clear of all liens,
easements, restrictions and encumbrances, rights of way of record and easements
of record now existing thereon for public utilities and highway use except
those which have been disclosed to the Lessee on Schedule 1.02 hereto.
Section 1.03 - Zoning and Other Restrictions. Lessor warrants that the
Demised Premises and all improvements thereon are currently being used in
compliance with existing zoning. Lessor further warrants that no other
restrictions exist that would inhibit Lessee's use of the Demised Premises.
Further Lessor warrants that no other party has any rights to the Demised
Premises, either for possession or acquisition thereof.
<PAGE> 2
Section 1.04 - Habendum and Term. Lessor hereby leases the Demised
Premises to Lessee to have and to hold the Demised Premises with the rights,
privileges, easements and appurtenances thereto attaching and belonging, to the
Lessee, its successors and assigns, with a quiet and undisturbed possession to
Lessee, for an initial term of ten (10) years from the date hereof ("Initial
Term"). This lease shall be automatically extended for two additional five (5)
year periods (the "Renewal Term") upon the same terms and conditions as apply
herein unless either party provides written notice of termination to the other
party at least ninety (90) days prior to termination.
Section 1.05 - Use. The Lessee covenants that its use of the Demised
Premises shall be limited to its overhauling, maintenance, supplying and
redistribution of aircraft landing gears and associated parts (or such other
aircraft uses as the parties agree) to commercial and cargo airlines business
and that it will not use the Demised Premises or any improvements thereon for
any illegal or unlawful purpose, and further covenants not to grant permission
for the use by any permitted subtenant or occupant for illegal or unlawful
purposes, and the Lessee covenants that it will immediately, upon the discovery
of any such illegal or unlawful use, exert its best efforts to compel the
discontinuance of such uses.
ARTICLE II
RENT
Section 2.01 - Rent. The Lessee shall pay the Lessor during the
Initial Term of this lease rent in the amount of Twenty-One Thousand Six
Hundred Fifty Dollars ($21,650.00) per month ($259,838.00 per year based on
$6.50 per foot), payable in advance on the first day of each month commencing
on the effective date of this Agreement. Rent shall increase at the rate of one
percent (1%) per year during the Initial Term and any Renewal Terms.
Section 2.02 - Rent Payment. The Lessee shall during the term hereby
granted, pay to the Lessor the rent herein reserved and all
2
<PAGE> 3
such other sums as may become payable on account of the Lessee's default in the
observance of any of the covenants herein contained on the Lessee's part to be
performed, at the time and in the manner limited and prescribed herein for the
payment thereof.
Section 2.03 - Late Payment. Any installment of rent accruing under
the provisions of this lease which is not paid when due shall, after ten (10)
days written notice, bear interest at the rate of ten percent (10%) per annum
from the date due until paid, plus an additional service fee of two percent
(2%) for each delinquent payment due.
ARTICLE III
LESSEE'S COVENANTS
Section 3.01 - Taxes and Assessments. Lessee agrees to pay ten (10)
days before delinquent all taxes, general and special assessments and other
public charges levied upon or assessed against the Demised Premises which
become payable from and after the date this lease commences until expiration or
termination of this lease.
Section 3.02 - Receipts; Proration. Lessee shall exhibit to Lessor
from time to time official receipts evidencing payment of taxes as required in
Section 3.01 prior to the delinquent date. Any such taxes and other public
charges assessed against the Demised Premises for the tax year in which this
lease commences or terminates shall be equitably prorated between the parties
hereto if the commencement and the end of the term of this lease do not
coincide with the beginning or end of the tax year.
Section 3.03 - Installment Payment. Lessee shall have the right to
execute in the name of the Lessor and as its attorney in fact such agreement or
agreements or other instrument which may be required or permitted by law to
permit the payment of such taxes or assessments in installments, but Lessee
shall not be liable to pay any installments for taxes not due at the end of
this original or any renewed term after occupancy of the Lessee has closed.
Section 3.04 - Unpaid Taxes. If Lessee fails to pay any such taxes,
assessments or other public charges which it is obligated to pay as provided in
this Article, before the same become delinquent,
3
<PAGE> 4
then and in such event, Lessor may pay the same, together with any interest and
penalties thereon, and the amount so paid shall be deemed rent immediately due
and payable by Lessee to Lessor on demand, together with interest thereon at
the rate of ten percent (10%) per annum plus an additional service fee of two
percent (2%).
Section 3.05 - Contest of Taxes. Anything in this Article to the
contrary notwithstanding, Lessor agrees that Lessee shall have the right, at
Lessee's sole cost and expense, to contest the legality, validity, or the basis
of calculation, of any of the taxes, assessments or other public charges
provided to be paid by Lessee, but no such contest shall be carried on or
maintained by Lessee after such taxes, assessments or other public charges
become delinquent unless Lessee shall have duly paid the amount involved under
protest or shall procure and maintain a stay of all proceedings to enforce any
collection thereof and any forfeiture or sale of the Demised Premises, and
shall also provide for payment thereof together with all penalties, interest,
cost and expense by deposit of a sufficient sum of money or by a good and
sufficient undertaking as may be required by law to accomplish such stay.
Lessor agrees that it will, at the request of Lessee, execute or join in the
execution of any instrument or documents necessary in connection with any such
contest except bonds or undertakings. In the event any such contest is made by
Lessee, Lessee shall promptly, upon final determination thereof adversely to
Lessee, pay and discharge the amount involved, or affected by, any such
contest, together with any penalties, fines, interest, costs and expenses that
may have accrued thereon.
Section 3.06 - Maintenance and Repairs. As between the Lessor and the
Lessee, the Lessee shall pay or cause to be paid all non-structural repair and
maintenance costs and shall take good care of the Demised Premises and keep the
same and all parts thereof, together with any and all alterations, additions
and improvements therein or thereto, in good order and condition, except for
normal wear and tear, damage done by casualty not covered by the provisions of
the usual fire and extended coverage insurance, or acts of the Lessor.
The Lessor agrees to maintain the premises and structure in a good
state of repair during the term of this lease and, further, specifically agrees
that Lessor shall be responsible for: (1) major repairs to the utility systems
of the demised premises
4
<PAGE> 5
including, but not necessarily limited to, the following: heating and air
conditioning systems, sewer, water, electric, and plumbing; (2) all
non-structural and structural maintenance and repair to the roof, exterior
walls, and structural components; (3) replacement or modification of the
electrical system or plumbing system as necessary to bring the demised premises
into compliance with applicable building codes. In the event the Lessor fails
to make the repairs, replacements or modifications, or to perform the
maintenance described herein, the Lessee shall have the right to terminate this
lease upon thirty (30) days written notice sent by first class mail to the
Lessor.
Section 3.07 - Alterations and Improvements. The Demised Premises may
not be altered or changed without the written consent of the Lessor and the
Lessee shall not attach anything whatsoever to the Demised Premises that might
damage the Demised Premises or that might be a permanent attachment to the
Demised Premises without the written consent of Lessor. The consent of Lessor
shall not be unreasonably withheld. The costs of any such alterations or
improvements approved by Lessor shall be borne by the Lessee and shall remain
upon and be surrendered with the Demised Premises; provided, however, that any
trade fixtures installed by Lessee may be removed by Lessee at the expiration
of the term of this Lease, or of any renewal, provided that the Lessee is not
in default under the terms hereof and provided further that any damage
occasioned by any such removal shall be paid by Lessee.
Section 3.08 - Fees and Commissions. Lessor and Lessee represent to
each other that neither party has engaged the services of a real estate broker
or agent in negotiating or consuming the closing of this Lease. Lessor and
Lessee agree to indemnify and hold each other free and harmless of any
obligation for real estate commissions, finder's fees and legal fees earned as
services performed in connection with this lease.
Section 3.09 - Indemnification of Lessor. Lessee covenants and agrees
that Lessor shall not be liable for any injuries or damages to persons,
entities, or property from any cause whatsoever by reason of the use,
occupation, control or enjoyment of the Demised Premises by Lessee, or any
person entering thereon for any reason or invited (other than Lessor or their
agents), suffered or permitted by Lessee to go or be thereon or holding under
Lessee at any time during the term of this lease, and Lessee will save and
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hold harmless Lessor from and against any and all liability, penalties,
damages, expenses and judgments whatsoever on account of such injuries or
damages. The injuries and damages referred to in this paragraph shall include,
without limiting the generality of the preceding provisions, to injuries,
damages and mechanic's liens arising directly or indirectly out of any
demolition, repairs, restoration, reconstruction, changes, alterations and
construction which Lessee may make or cause to be made upon the Demised
Premises or any part thereof. Lessee, at Lessee's expense, agrees to employ
legal counsel to defend any action for which any claim shall be made for
injuries or damages commenced against Lessor by reason of the foregoing.
Section 3.10 - Compliance with Laws. The Lessee covenants that it will
during the demised term properly observe and at its own expense promptly comply
with and execute all present and future laws, rules, regulations and notices of
every nature and kind whatsoever of any governmental agency or authority
concerning the Demised Premises. It is expressly understood that the Lessee
shall have thirty (30) days or such time as said authorities shall accord, or
that Lessee shall necessarily need, within which to comply with, contest, obey,
carry out, observe and/or perform any such law, rule, regulation or notice.
Section 3.11 - Utilities. Lessee shall either pay or cause to be paid
all charges for gas, electricity, water, sewer and other public utility
services supplied to the Demised Premises during the term of this lease.
Section 3.12 - Liability and Property Insurance. Lessor shall, during
the term of this lease, maintain adequate fire and casualty liability insurance
coverage on the Demised Premises in solvent, mutual or stock companies or
company, insuring both the Lessor and Lessee, in an amount and form reasonably
acceptable to the parties.
Lessee shall, during the demised term, maintain adequate personal
property insurance insuring all equipment, trade fixtures, fixtures, inventory
and other personal property located on the Demised Premises. Lessee shall
maintain throughout the term of this lease adequate general liability insurance
coverage on the Demised Premises in solvent, mutual or stock companies or
company, insuring both the Lessor and the Lessee, in an amount and form
reasonably acceptable to the parties.
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ARTICLE IV
LESSOR'S COVENANTS
Section 4.01 - Quiet Possession. The Lessor covenants that the Lessee,
upon payment of the rent above reserved, and upon the due performance of the
covenants and agreements herein contained, shall and may at all times during
the term hereby granted, peaceably and quietly have, hold and enjoy the Demised
Premises pursuant to the terms hereof.
ARTICLE V
ENVIRONMENTAL COMPLIANCE
Section 5.01 - Definitions "Toxic or Hazardous Substances" shall be
interpreted broadly to include, but not be limited to, any material or
substance that is defined or classified under federal, state or local laws as:
(a) a "hazardous substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. ss.9601(14),
Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. ss.1321, as
now or hereafter amended; (b) a "hazardous waste" pursuant to Section 1004 or
Section 3001 of the Resource Conservation and Recovery Act, 42 U.S.C. ss.6903,
42 U.S.C. ss.6921, as now or hereafter amended; (c) a toxic pollutant under
Section 307(1)(a) of the Federal Water Pollution Control Act, 33 U.S.C.
ss.1317(1)(a); (d) a "hazardous air pollutant" under Section 112 of the Clean
Air Act, 42 U.S.C. ss.7412, as now or hereafter amended; (e) a "hazardous
material" under the Hazardous Material Transportation Act, 49 U.S.C.
ss.1802(2), as now or hereafter amended; (f) toxic or hazardous pursuant to
regulations promulgated now or hereafter under the aforementioned laws; or (g)
presenting a risk to human health or the environment under other applicable
federal, state or local laws, ordinances, or regulations, as now or as may be
passed or promulgated in the future. "Toxic or Hazardous Substances" shall also
mean any substance that after release into the environment upon exposure,
ingestion, inhalation or assimilation, either directly from the environment or
indirectly by ingestion through food chains, will or may reasonably be
anticipated to cause death, disease, behavior
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abnormalities, cancer or genetic abnormalities. "Toxic or Hazardous Substance"
specifically includes, but not limited to, asbestos, polychorinated biphenyls
(PCBs), petroleum and petroleum based derivatives and urea formaldehyde.
Section 5.02 - Representations and Warranties Lessor represents and
warrants to Lessee that (i) to the best knowledge of Lessor, any handling,
transportation, storage, treatment or use of Toxic or Hazardous Substances that
has occurred on the Demised Premises to date has been in compliance with all
applicable federal, state, and local laws, regulations and ordinances, and (ii)
to the best knowledge of Lessor, no leak, spill, release, discharge, emission
or disposal of Toxic or Hazardous Substances has occurred on the Demised
Premises to date and the soil, groundwater, and soil vapor on or under the
Demised Premises is free of Toxic or Hazardous Substances as of the date the
term of this Lease commences. Lessor shall be responsible for any required
cleanup or liability brought about by actions or inactions of any parties prior
to Lessee's possession of the Demised Premises. A Limited Phase II
Environmental Assessment was conducted on the Demised Premises June 17, 1998.
Lessor has provided Lessee with the Limited Phase II Environmental Assessment
Report dated June 17, 1998. Lessor had any and all recommended cleanups
recommended by the Limited Phase II Environmental Assessment Report performed
prior to Lessee's possession of the Demised Premises.
Section 5.03 - Indemnities
(a) Lessor's Indemnity. Lessor agrees to indemnify, defend (with
counsel satisfactory to Lessee) and hold Lessee and its officers, employees,
contractors, and agents harmless from any claims, judgments, damages,
penalties, fines, expenses, liabilities or losses arising during or after the
lease term out of or in any way relating to a breach of the environmental
warranties made by Lessor above or to the presence, release or disposal of
Toxic or Hazardous Substances on or from the Demised Premises except where such
presence, release or disposal results from any act or omission of Lessee during
its occupancy of the Demised Premises. Such indemnity shall include, without
limitation, costs incurred in connection with:
(i) the presence or suspected presence of Toxic or Hazardous
Substances in the soil, groundwater or soil vapor on or under the
Demised Premises before Lessee occupies the Demised Premises or the
Lease Term commences;
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(ii) the presence or suspected presence of Toxic or Hazardous
Substances on or under the Demised Premises as a result of any
discharge, dumping, spilling (accidental or otherwise) onto the
Demised Premises during Lessee's occupancy of the Demised Premises or
after the lease term commences by Lessor.
The indemnification provided by this section shall also specifically
cover, without limitation, costs incurred in connection with any investigation
of site conditions or any cleanup, remedial removal or restoration work
required in either event by any federal, state or local governmental agency or
political subdivision or by court order because of the presence or suspected
presence of Toxic or Hazardous Substances in the soil, groundwater, or soil
vapor on or under the Demised Premises, for which Lessor is responsible as
provided above. Such costs may include , but not be limited to, response costs
incurred as a result of the order of a court or governmental agency and related
attorneys fees, consultants fees, and expert fees.
The foregoing environmental indemnity shall survive the expiration or
earlier termination of this Lease and/or any transfer of all or any portion of
the Demised Premises, or of any interest in this Lease.
(b) Lessee's Indemnity Lessee agrees to indemnify, defend (with
counsel satisfactory to Lessor) and hold Lessor and its officers, employees,
contractors, and agents harmless from any claims, judgments, damages,
penalties, fines, expenses, liabilities or losses arising during or after the
lease term out of or in any way relating to the presence, release or disposal
of Toxic or Hazardous Substances on or from the Demised Premises where such
presence, release or disposal results from any act or omission of Lessee during
its occupancy of the Demised Premises. Such indemnity shall, without
limitation, include costs incurred in connection with:
(i) the presence or suspected presence of Toxic or Hazardous
Substances in the soil, groundwater or soil vapor on or under the
Demised Premises resulting from any act or omission of Lessee;
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(ii) the presence or suspected presence of Toxic or Hazardous
Substances on or under the Demised Premises as a result of any
discharge, dumping, spilling (accidental or otherwise) onto the
Demised Premises by Lessee during Lessee's occupance of the Demised
Premises or after the lease term commences.
The indemnification provided by this section shall also specifically
cover, without limitation, costs incurred in connection with any investigation
of site conditions or any cleanup, remedial removal or restoration work
required in either event by any federal, state or local governmental agency or
political subdivision or by court order because of the presence or suspected
presence of Toxic or Hazardous Substances in the soil, groundwater, or soil
vapor on or under the Demised Premises, for which Lessee is responsible as
provided above. Such costs may include, but not be limited to, response costs
incurred as a result of the order of a court or governmental agency and related
attorneys fees, consultants fees, and expert fees.
The foregoing environmental indemnity shall survive the expiration or
earlier termination of this lease and/or any transfer of all or any portion of
the Demised Premises, or of any interest in this lease.
ARTICLE VI
EMINENT DOMAIN
Section 6.01 - Eminent Domain. If more than twenty-five percent (25%)
of the land area of the Demised Premises is taken under the power of eminent
domain (including any conveyance made in lieu thereof), and such taking shall
make the operation of Lessee's business on the Demised Premises impractical,
then Lessee shall have the right to terminate this lease by giving Lessor
written notice of such termination within thirty (30) days after such taking or
condemnation. If Lessee does not so elect to terminate this lease, the rental
to be paid by Lessee hereunder shall be
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equitably reduced in proportion to Lessee's loss of the use of the Demised
Premises. Any award or awards payable on account of any taking or condemnation
of all or part of the Demised Premises shall be payable to Lessor.
ARTICLE VII
DEFAULT
Section 7.01 - Termination of Lease. Upon occurrence of any default,
Lessor may, at its option, in addition to any other remedy or right given
hereunder or by law,
(a) terminate and cancel this lease at any time after the expiration
of thirty (30) days from the giving of notice of default to the party
in default, but only if the party in default has not remedied such
default within the said thirty (30) days or if the party in default
has not commenced such act or acts as shall be necessary to remedy the
default and shall complete such act or acts promptly; or
(b) terminate this lease for the nonpayment of rent at any time after
the expiration of ten (10) days following written notice to Lessee of
nonpayment of such rent (provided each default has not been cured);
and
(c) any termination of this lease under sub-paragraphs (a) and (b) of
this Section 7.01 shall not prejudice Lessor's right to prosecute any
other remedy which it may have for a breach of this lease or default
hereunder.
Section 7.02 - Event of Default Defined. Each of the following shall
be deemed an event of default:
(a) Default in the payment of rent or other payments hereunder where
such default has not been cured within 10 days of written notice of
such default;
(b) If Lessee shall default in the performance or observance of any
other covenant or condition of this lease by the Lessee to be
performed or observed and such default has not been cured within 30
days written notice of such default;
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(c) The filing or execution or occurrence of
(1) A petition in bankruptcy by or against the Lessee which
remains undischarged for 60 days after filing;
(2) A petition or answer against Lessee seeking a reorganization,
arrangement, composition, readjustment, liquidation, dissolution
or other relief of the same or different kind under any provision
of the Bankruptcy Act;
(3) Adjudication of Lessee as a bankrupt or insolvent or
insolvency in the bankruptcy or equity sense;
(4) An assignment by Lessee for the benefit of creditors, whether
by trust mortgage or otherwise;
(5) A petition or other proceeding by or against the Lessee for,
or the appointment of, a trustee, receiver, guardian, conservator
or liquidator of Lessee with respect to all or substantially all
of its property;
(6) A petition or other proceeding by or against the Lessee for
its dissolution or liquidation, or the taking of possession of
the property of the Lessee by any governmental authority in
connection with dissolution or liquidation; or
(7) The taking by any person of the leasehold created hereby or
part thereof upon execution, attachment or other process of law
or equity (except pursuant to a valid assignment or sublease
pursuant to Article VIII).
Section 7.03 - Repossession. Upon termination of this lease as
hereinabove provided, or pursuant to statute, or by summary proceedings or
otherwise, the Lessor may enter forthwith without further demand or notice upon
any part of the Demised Premises, if it has not theretofore done so, and resume
possession either by summary proceedings, or by action at law or in equity or
by entry or otherwise as the Lessor may determine, and shall not be liable in
trespass or for any damages to Lessee or any other person. In no event shall
such re-entry or resumption of possession or reletting as hereafter provided be
deemed to be an acceptance or surrender of this lease or a waiver of the rights
or remedies of Lessor hereunder.
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Section 7.04 - Reletting. Upon termination of this lease in any manner
above provided, the Lessor shall use reasonable efforts to relet the Demised
Premises.
Section 7.05 - Lessor's Right to Cure Default of Lessee. If Lessee
shall be in default in any of the terms or provisions of this lease, other than
the payment of rental, Lessor may, after thirty (30) days written notice to
Lessee, immediately or at any time thereafter, without being required to give
notice, perform the same for the account of Lessee and at the cost and expense
of Lessee, and Lessee shall pay to Lessor on demand any amount properly paid by
Lessor including reasonable attorney fees for such purpose, with interest
thereon at the rate of ten percent (10%) per annum plus an additional service
fee of two percent (2%) from the date of payment thereof by Lessor.
Section 7.06 - Non-Exclusive Effect. The default provisions in this
Article VII shall not operate to exclude, override or limit any other right or
remedy provided in this lease, but shall be read in conjunction with the other
provisions hereof as supplementary thereto, and any election by the party for
whose benefit a particular provision operates, as communicated in any notice to
the other party, shall be conclusive as to the provision under which the former
is proceeding. Unless otherwise specified in such notice, however, any such
election shall not act as a waiver of the right to proceed under any other
provision at any other time with respect to the same or any other breach,
default, omission or failure of performance which may be the subject of the
election.
ARTICLE VIII
ASSIGNMENT, SUBLETTING, ATTORNMENT
Section 8.01 - Assignment. This lease may be assigned only with the
written consent of the Lessor which will not be unreasonably withheld.
Section 8.02 - Subletting. Lessee shall not sublet the Demised
Premises or any part thereof without the express written consent of the Lessor
which will not be unreasonably withheld.
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Section 8.03 - Assignment by Lessor. Lessor may, from time to time,
without further consent of Lessee, assign Lessor's interest in this lease,
either in whole or in part, to any bank, insurance company, or other
established lending institution, but only subject to the rights of Lessee under
this lease and only while the Lessee is not in default.
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ARTICLE IX
TRANSFER OF LESSOR'S INTEREST
Section 9.01 - Transfer of Lessor's Interest. In the event of the
sale, assignment or transfer by Lessor of its interest in the Demised Premises
or in this lease (other than a collateral assignment to secure a debt of
Lessor) to a successor in interest who expressly assumes the obligations of
Lessor hereunder, Lessor shall thereupon be released or discharged from all of
its covenants and obligations hereunder, except such obligations as shall have
accrued prior to any such sale, assignment or transfer; and Lessee agrees to
look solely to such successor in interest of Lessor for performance of such
obligations. Lessor's assignment of the lease or of any or all of its rights
herein shall in no manner affect Lessee's obligations hereunder. Lessee shall
thereafter attorn and look to such assignee, as Lessor, provided Lessee has
first received written notice of such assignment of Lessor's interest.
ARTICLE X
SUPPLEMENTARY AGREEMENT
Section 10.01 - Agreement as to Modification. Lessee agrees at any
time and from time to time upon not less than ten (10) days prior written
request by Lessor, to execute, acknowledge and deliver to Lessor, and Lessor
agrees at any time and from time to time, upon not less than ten (10) days
prior written request by Lessee, to execute, acknowledge and deliver to Lessee
a statement in writing certifying that this lease is unmodified and in full
force and effect (or if there have been mutually agreed upon modifications that
the same is in full force and effect, as modified, and stating the
modifications), and the dates to which the fixed rent and other charges have
been paid in advance, if any, and whether or not there is any existing default,
other than on any existing mortgage, by Lessee with respect to any sums of
money required to be paid by Lessee under the terms of this lease, or notice of
default served by Lessor, it being intended that any such statement delivered
pursuant to this paragraph may be relied upon by any prospective purchaser of
the fee or leasehold estate or by any prospective or existing mortgagee or
assignee of any mortgage upon the leasehold estate, or by any prospective
assignee or subtenant of the leasehold estate. If any such certification by
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Lessor shall allege non-performance by Lessee, the nature and extent of such
non-performance shall, insofar as actually known by Lessor, be summarized
therein. In the event that either party shall fail to execute, acknowledge and
deliver to the other each statement prior to the expiration of said ten (10)
day period, it shall be conclusively presumed a certification that this lease
is unmodified and in full force and effect, that all rental has been paid to
date and that there is no existing default.
Section 10.02 - Acknowledgment of Rent. The Lessor within ten (10)
days, upon request of the Lessee or any holder of a mortgage on the fee or
leasehold interest herein demised, will furnish a written statement duly
acknowledging the amount of rent and additional rent due, if any.
Section 10.03 - Easements. Lessor covenants and agrees that it will
execute any and all instruments that may be required of the Lessor in
connection with the granting of easements for installation of water, gas,
steam, electricity, telephone, sewage and storm drainage of the various utility
companies affecting any street, opened or proposed, on any part of the Demised
Premises.
Section 10.04 - Notice of Default. Wherever in this lease the Lessor
is given the right to pay any sum of money or perform any act which, by the
terms of this lease, are to be performed by the Lessee, Lessor agrees that it
will not so pay or perform until it has given Lessee thirty (30) days written
notice of its intent so to do and the Lessee at the expiration of such thirty
(30) day period has not made such payment or commenced and is diligently
prosecuting such performance; provided, however, that such period shall not
exceed any other period of notification specifically set forth herein relating
to specific acts of the parties hereto, it being specifically understood that
this thirty (30) day period notice shall not control or override the other
notice requirements specifically set forth in the lease agreement.
ARTICLE XI
NOTICES
Any and all notices by the Lessor to the Lessee, or by the Lessee to
the Lessor, shall be in writing and by registered or certified mail addressed
to the respective addresses below stated:
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To the Lessor by Communication addressed to:
Condor Properties of Miami, Inc.
Attn: Ned Angene
6929 NW 46 Street
Miami, Florida 33166
With a Copy to:
Christopher J. Dawes
Haley, Sinagra & Perez, P.A.
100 South Biscayne Boulevard, Suite 800
Miami, FL 33131
To the Lessee by Communication addressed to:
American Aircarriers Support, Incorporated
Attn: Karl F. Brown
P. O. Box 7566
Charlotte, NC 28241
With a Copy to:
David M. Furr
Gray, Layton, Kersh, Solomon,
Sigmon, Furr & Smith, P.A.
Post Office Box 2636
Gastonia, NC 28053-2636
Rent shall be payable by check sent by ordinary mail to the Lessor at the above
address for notices.
ARTICLE XII
VALIDITY OF PROVISIONS
If any clause or provision herein contained shall be adjudged invalid,
the same shall not affect the validity of any other clause
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or provision of this lease or constitute any cause of action in favor of either
party as against the other, unless the same shall prevent the operation upon
the Demised Premises of the use now contemplated by the parties.
The Lessor and the Lessee hereto agree to execute and deliver upon
notice as set forth elsewhere in this lease, any and all instruments in writing
necessary to carry out any terms, conditions, covenants or assurances in this
lease.
ARTICLE XIII
BINDING ON HEIRS
It is further covenanted and agreed, by and between the Lessor and the
Lessee, that all the covenants, agreements, provisions, conditions and
undertakings in this lease contained shall extend to and be binding upon the
heirs, executors, successors, and permitted assigns of the respective Lessor
and Lessee hereto, and the same as if they were in every case named and
expressed, and shall be construed as covenants running with the land; and that
wherever in this lease reference is made to either the Lessor or the Lessee
hereto, it shall be held to include and apply to (wherever and whenever
applicable) also the heirs, executors, successor, personal or legal
representatives, and permitted assigns of each Lessor or Lessee, and same as if
in each and every case so expressed.
ARTICLE XIV
HOLDING OVER
If Lessee shall hold over after the expiration of the term of this
lease, or any extension thereof, such tenancy shall be from month to month only
and upon all the terms, covenants and conditions hereof.
ARTICLE XV
EXTENSION OF TIME
It is covenanted and agreed by and between the Lessor and the Lessee
that the time or times herein specified within which the Lessee or Lessor is
required to perform any act or to do anything
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in order to comply with the terms and provisions of this lease except for the
obligation to pay rent or other sums coming due, shall be, and they are each
hereby, extended to the extent that the Lessee or Lessor is actually and in
good faith delayed or hindered by strikes, lockouts, force majeure, the
elements, or other causes or conditions beyond Lessee's or Lessor's control.
ARTICLE XVI
SURRENDER OF PREMISES
The Lessee shall surrender and deliver up the Demised Premises, in as
good condition as when received, reasonable and ordinary wear and tear
excepted.
ARTICLE XVII
INSPECTION AND ACCESS TO DEMISED PREMISES
The Lessor shall have access to the Demised Premises at reasonable
hours for inspection. Lessor's inspection shall be on a reasonable interval and
upon reasonable notice to the Lessee. Lessor shall have access to the Demised
Premises so that Lessor may enter other parts of the building (i.e. Section B
and Section C). Since the driveway is a common driveway used by all tenants of
the building, Lessee shall not do anything whatsoever to prevent other tenants
access to the driveway.
ARTICLE XVIII
ATTORNEYS' FEES
In the event it is necessary for either Lessor or Lessee to commence
legal action against the other on account of a default or violation of any of
the terms or conditions of this lease, by the other, the party prevailing in
such action shall be entitled to recover, in addition to any other relief
granted, attorneys' fees in an amount which the Court may determine to be
reasonable.
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ARTICLE XIX
CONSTRUCTION AND INTERPRETATION
The titles, headings or catch lines preceding the Articles of this
lease agreement are for the purpose of easy reference and shall not be
considered a part of this agreement. Further, this lease agreement is made and
executed in the State of Florida and shall be construed, interpreted, and
enforced pursuant to the laws of the State of Florida.
ARTICLE XX
SHORT FORM LEASE
Lessor or Lessee shall have the right to require of the other party
that a short form lease be executed at the time of the execution of this lease
instrument, or thereafter upon request at Lessee's sole expense said short form
lease to be for recording purposes only.
ARTICLE XXI
WAIVER
No waiver of a breach of any of the agreements or provisions contained
in this lease shall be construed to be a waiver of any subsequent breach of the
same or of any other provisions in the lease.
ARTICLE XXII
REQUEST TO SIGN LANDLORD WAIVER
Lessor agrees to any reasonable request to execute a landlord waiver
in favor of any lending institution of Lessee.
ARTICLE XXIII
COMPLETE AGREEMENT
This instrument contains the complete agreement of the parties
regarding the terms and conditions of the lease of the Demised Premises and
there are no oral or written conditions, terms, understanding of other
agreements pertaining thereto which have not been incorporated herein.
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IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
and seals as of the day and year first above written.
LESSOR:
ATTEST: CONDOR PROPERTIES OF MIAMI, INC.
/s/ Martin Washofsky By /s/ Ned Angene
- ---------------------------- ---------------------------------
[SEAL]
LESSEE:
ATTEST: AMERICAN AIRCARRIERS SUPPORT,
INCORPORATED
/s/ David M. Furr By /s/ Karl F. Brown
- ---------------------------- ---------------------------------
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