<PAGE> 1
UNITED STATES
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): December 16, 1997
GETTY REALTY CORP.
(Exact name of registrant as specified in charter)
Delaware 1-8059 11-2232705
(State of Organization) (Commission (IRS Employer
File Number) Identification No.)
125 Jericho Turnpike, Jericho, New York 11753
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (516) 338-6000
Not Applicable
(Former name or former address, if changed since last report)
<PAGE> 2
Item 5. Other Events.
On December 16, 1997, Getty Realty Corp., a Delaware corporation
("Getty), Power Test Investors Limited Partnership, a New York limited
partnership ("PTI") and CLS General Partnership Corp., a Delaware corporation
and the general partner of PTI, entered into an Agreement and Plan of
Reorganization and Merger (the "Merger Agreement"), which is attached hereto as
Exhibit 99.1 and incorporated by reference herein. Pursuant to the terms of
the Merger Agreement, Getty and PTI will form a Maryland holding company
("Holdings"), Holdings will form two subsidiaries (Getty Merger Sub, Inc.
("Getty Sub") and PTI Merger L.L.C. ("PTI LLC")) and, subject to certain
conditions being satisfied or waived, Getty Sub will merge with and into Getty
and PTI LLC will merge with and into PTI (the "Getty Merger" and the "PTI
Merger," and collectively, the "Mergers"). Pursuant to the Mergers, (i) each
outstanding share of Getty Common Stock, par value $.10 per share, will be
converted into the right to receive one share of Holdings Common Stock, par
value $.01 per share ("Holdings Common Stock"), (ii) each outstanding unit of
limited partnership interest in PTI will be converted into the right to receive
0.44 share of Holdings' Series A Participating Convertible Redeemable Preferred
Stock, par value $.01 per share ("Holdings Preferred Stock"), and (iii) each
outstanding unit of general partnership interest in PTI will be converted into
the right to receive 0.44 share of Holdings Preferred Stock. It is anticipated
that the Holdings Common Stock and Holdings Preferred Stock will trade on the
New York Stock Exchange. Conditions to the comsummation of the Mergers include
the receipt of approval from the stockholders of Getty and holders of PTI
limited partnership interests. The parties anticipate scheduling special
meetings of Getty stockholders and holders of PTI limited partnership interests
to vote on the proposed Mergers as soon as proxy materials are cleared by the
Securities and Exchange Commission, and expect to close the transaction in
early 1998.
On December 17, 1997, Getty and PTI issued a joint press release
announcing the execution of the Merger Agreement, which press release is
attached hereto as Exhibit 99.2 and incorporated herein by reference.
The foregoing summary of the Merger Agreement is qualified in its
entirety by reference to the full text of the agreement which is attached
hereto as an exhibit.
The information set forth above shall not be deemed to constitute an
offer to sell any security. Any such offer to sell will be made only by means
of a prospectus.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
7(c) Exhibits
99.1 Agreement and Plan of Reorganization and Merger dated as of
December 16, 1997.
99.2 Press Release dated December 17, 1997.
2
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
GETTY REALTY CORP.
Date: December 17, 1997 By: /s/ John J. Fitteron
-----------------------
John J. Fitteron
Senior Vice President, Treasurer
and Chief Financial Officer
3
<PAGE> 4
EXHIBIT INDEX
Sequentially
Exhibit No. Description Numbered Page
- ----------- ----------- -------------
99.1 Agreement Plan of Reorganization and
Merger dated as of December 16, 1997
99.2 Press Release dated December 17, 1997
4
<PAGE> 1
EXHIBIT 99.1
================================================================================
AGREEMENT AND PLAN OF REORGANIZATION AND MERGER
BY AND AMONG
GETTY REALTY CORP.,
POWER TEST INVESTORS LIMITED PARTNERSHIP
AND
CLS GENERAL PARTNERSHIP CORP.
(FOR PURPOSES OF SECTION 1.10 (b) ONLY)
_________________________
DATED AS OF DECEMBER 16, 1997
_________________________
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
Page
----
1. THE MERGERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Organization of Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Directors and Officers of Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Getty Sub Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 PTI Sub Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.5 The Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.6 Effective Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.7 Effects of the Mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.8 Certificates of Incorporation, Bylaws and Certificate of
Limited Partnership of the Surviving Entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.9 Directors, Officers and General Partner of the Surviving Entities . . . . . . . . . . . . . . . . . . 4
1.10 Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. CONVERSION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.1 Conversion of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.2 Payment for Getty Common Shares, Units and CLS Interest . . . . . . . . . . . . . . . . . . . . . . . 7
2.3 Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.4 Dissenters' Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.5 No Transfer after the Effective Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3. REPRESENTATIONS AND WARRANTIES OF GETTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.1 Existence; Good Standing; Corporate Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.2 Authorization; Validity and Effect of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.3 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.4 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.5 Other Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.6 No Conflict; Required Filings and Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.7 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.8 SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.9 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.10 Absence of Certain Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.11 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.12 State Takeover Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.13 No Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.14 Opinion of Financial Advisor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.15 Information in Joint Proxy Statement/Prospectus and Form S-4 . . . . . . . . . . . . . . . . . . . . . 14
3.16 Hart-Scott-Rodino . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4. REPRESENTATIONS AND WARRANTIES OF PTI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.1 Existence; Good Standing; Corporate Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.2 Authorization; Validity and Effect of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.3 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.4 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.5 Other Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.6 No Conflict; Required Filings and Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.7 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.8 SEC Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.9 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.10 Absence of Certain Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.11 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
</TABLE>
- i -
<PAGE> 3
<TABLE>
<S> <C> <C>
4.12 State Takeover Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.13 No Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.14 Opinion of Financial Advisor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.15 Information in Joint Proxy Statement/Prospectus and Form S-4 . . . . . . . . . . . . . . . . . . . . . . . 19
4.16 Hart-Scott-Rodino . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
5. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.1 Conduct of Business by Getty or PTI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
5.2 Meeting of Stockholders and Unitholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.3 Further Assurance and Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.4 Certain Filings and Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.5 Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.6 Joint Proxy Statement/Prospectus and the Form S-4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.7 Listing Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.8 Further Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.9 Affiliate Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.10 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.12 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.13 Letter of Getty's Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.14 Letter of PTI's Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.15 Registration Statement on Form S-8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.16. Tax Matters Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.17 Assumption of Obligations by Holdings, Getty Sub and PTI . . . . . . . . . . . . . . . . . . . . . . . . . 26
6. CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.1 Conditions to Each Party's Obligation to Effect the Mergers . . . . . . . . . . . . . . . . . . . . . . . . 26
6.2 Conditions to Obligation of Getty to Effect the Mergers . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.3 Conditions to Obligation of PTI to Effect the Mergers . . . . . . . . . . . . . . . . . . . . . . . . . . 28
7. TERMINATION, WAIVER AND AMENDMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.1 Termination or Abandonment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.2 Amendment or Supplement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.3 Extension of Time, Waiver, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.1 Non-survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.3 Assignment; Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.4 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.5 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.6 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.7 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.8 Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.9 Incorporation of Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.10 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.11 Enforcement of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
9. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
9.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
9.2 Other Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
</TABLE>
ii
<PAGE> 4
LIST OF EXHIBITS
Exhibit A - Form of Articles of Incorporation of Holdings
Exhibit B - Form of Bylaws of Holdings
Exhibit C - Form of Certificate of Merger to be filed in Delaware
Exhibit D - Form of Certificate of Merger to be filed in New York
Exhibit E - Form of Certificate of Incorporation of New Getty
Exhibit F - Form of Certificate of Limited Partnership of New PTI
Exhibit G - Articles Supplementary for Holdings Preferred Stock
Exhibit H - Forms of Affiliate Letter
Exhibit I - Forms of Tax Matters Certificates
iii
<PAGE> 5
AGREEMENT AND PLAN OF REORGANIZATION AND MERGER
Agreement and Plan of Reorganization and Merger (this
"Agreement"), dated as of December 16, 1997, by and among Getty Realty Corp., a
Delaware corporation ("Getty"), Power Test Investors Limited Partnership, a New
York limited partnership ("PTI"), and for purposes of Section 1.10 (b) only,
CLS General Partnership Corp., a Delaware corporation ("CLS").
RECITALS
A. The Board of Directors of Getty, based upon the recommendation
of the Special Committee thereof, deems it advisable and in the best interest
of Getty and its stockholders to consummate, and has approved, including for
purposes of Section 251(b) of the General Corporation Law of the State of
Delaware (the "DGCL"), the business combination transactions provided for
herein; and CLS, the general partner of PTI, deems it advisable and in the best
interest of PTI and its limited partners to consummate, and has approved,
including for purposes of Sections 121-1102 and 121-1106 of the Revised Limited
Partnership Act of the State of New York (the "NLPA"), the business combination
transactions provided for herein, in which:
(1) Getty and PTI will form a Maryland corporation,
Getty Realty Holding Corp. ("Holdings"); and
(2) Holdings will form two subsidiaries, a
Delaware corporation which will merge with and into Getty with
Getty continuing as the surviving corporation (the "Getty
Merger"), and a New York limited liability company which will
merge with and into PTI with PTI continuing as the surviving
partnership (the "PTI Merger" and, together with the Getty
Merger, the "Mergers"), and (i) each issued and outstanding
Getty Common Share (as hereinafter defined) will be converted
into the right to receive common stock, par value $.01 per
share, of Holdings ("Holdings Common Stock"), and (ii) each PTI
partnership interest that is not held by a Dissenting Limited
Partner (as hereinafter defined) will be converted into the
right to receive Series A Participating Convertible Redeemable
Preferred Stock, par value $.01 per share, of Holdings
("Holdings Preferred Stock"), all as more fully set forth below;
B. For federal income tax purposes, it is intended that the Getty
Merger qualify as a tax-free reorganization within the meaning of Section
368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and that
the PTI Merger qualify as a tax-free exchange within the meaning of Section
351(a) of the Code; and
C. Getty and PTI desire to make certain representations,
warranties and agreements in connection with the Mergers and also to prescribe
various conditions to the Mergers.
- 1 -
<PAGE> 6
Capitalized terms used in this Agreement and not otherwise defined
herein shall have the meanings set forth in Section 9.1 hereof.
1. THE MERGERS
1.1 Organization of Holdings. As promptly as practicable
following the execution of this Agreement, Getty and PTI shall cause Holdings
to be organized under the laws of the State of Maryland. The initial articles
of incorporation and bylaws of Holdings shall be substantially in the forms
attached hereto as Exhibits A and B, respectively. The authorized capital
stock of Holdings shall consist initially of 1,000 shares of Holdings Common
Stock and 100 shares of Holdings Preferred Stock, of which 500 shares of
Holdings Common Stock will be issued to Getty and 500 shares of Holdings Common
Stock will be issued to PTI. Prior to the Effective Time (as hereinafter
defined), Getty and PTI shall cause Holdings to amend its articles of
incorporation to increase the number of authorized shares thereunder and to
provide for the issuance of Holdings Common Stock and Holdings Preferred Stock
pursuant to the Mergers. In connection with the Mergers, Holdings will change
its name from Getty Realty Holding Corp. to "Getty Realty Corp." and
immediately prior thereto, New Getty (as hereinafter defined) will change its
name to "Getty Properties Corp."
1.2 Directors and Officers of Holdings. (a) Upon
formation of Holdings, Getty and PTI shall cause to be elected as directors of
Holdings Leo Liebowitz and Milton Cooper. As of the Effective Time, the
Holdings Board of Directors shall consist of Milton Cooper, Leo Liebowitz,
Philip E. Coviello, Milton Safenowitz and Warren G. Wintrub. Each director
shall remain in office until his successor is duly elected or appointed and
qualified or until such director's earlier death, resignation or removal in
accordance with the articles of incorporation and bylaws of Holdings.
(b) Upon formation of Holdings, Leo Liebowitz shall be
the President of Holdings, John J. Fitteron shall be Senior Vice President,
Treasurer and Chief Financial Officer of Holdings and Randi Young Filip shall
be Corporate Secretary of Holdings. As of the Effective Time, Leo Liebowitz
shall be the President and Chief Executive Officer of Holdings and the other
officers of Holdings shall consist of the officers of Getty immediately prior
to the Effective Time.
1.3 Getty Sub Merger.
(a) As promptly as practicable after the formation of
Holdings, Getty and PTI shall cause Holdings to form a wholly-owned corporation
called Getty Merger Sub, Inc. ("Getty Sub") under the laws of the State of
Delaware. Getty and PTI shall cause Holdings to cause Getty Sub to execute and
deliver this Agreement and to merge with and into Getty. Getty shall be the
surviving corporation in the Getty Merger and as a result thereof shall become
a wholly-owned subsidiary of Holdings.
2
<PAGE> 7
(b) The certificate of incorporation and bylaws of Getty
Sub shall be in such form as shall be determined by Holdings. Upon formation
of Getty Sub, Holdings shall designate the Board of Directors and such Board of
Directors, by unanimous written consent, shall appoint officers of Getty Sub.
(c) Getty shall use its best efforts to cause the Getty
Merger to be consummated in accordance with the terms of this Agreement. Getty
and PTI shall cause Holdings to execute a formal written consent under Section
228 of the DGCL, as the sole stockholder of Getty Sub, to the execution,
delivery and performance of this Agreement by Getty Sub.
1.4 PTI LLC Merger.
(a) As promptly as practicable after the formation of
Holdings, Getty and PTI shall cause Holdings to form a wholly-owned limited
liability company called PTI Merger L.L.C. ("PTI LLC") under the laws of the
State of New York. Getty and PTI shall cause Holdings to cause PTI LLC to
execute and deliver this Agreement and to merge with and into PTI. PTI shall
be the surviving partnership in the PTI Merger and will immediately dissolve
pursuant to the provisions of the NLPA.
(b) The articles of organization of PTI LLC shall be in
such form as shall be determined by Holdings. Upon formation of PTI LLC,
Holdings shall designate the managers of PTI LLC.
(c) PTI shall use its best effort to cause the PTI Merger
to be consummated in accordance with the terms of this Agreement. Getty and
PTI shall cause Holdings to execute a formal written consent under Section 407
of the Limited Liability Company Law of the State of New York (the "NLLCL"), as
the sole member of PTI LLC, to the execution, delivery and performance of this
Agreement by PTI LLC.
1.5 The Closing. The closing (the "Closing") of the
transactions contemplated by this Agreement will take place at the offices of
Latham & Watkins, 885 Third Avenue, Suite 1000, New York, New York 10022 at
10:00 a.m., local time, as soon as practicable following the date on which the
last of the conditions set forth in Article 6 is satisfied or waived in
accordance herewith or at such other place, time or date as Getty and PTI may
agree. The date on which the Closing occurs is hereinafter referred to as the
"Closing Date".
1.6 Effective Time. On the Closing Date, (i) Getty will
cause a certificate of merger in the form attached hereto as Exhibit C to be
filed with the Secretary of State of the State of Delaware as provided in
Section 251 of the DGCL in order to effect the Getty Merger; and (ii) PTI will
cause a certificate of merger in the form attached hereto as Exhibit D to be
filed with the Secretary of State of the State of New York as provided in
Sections 121-1103 and 121-1106 of the NLPA in order to effect the PTI Merger.
Upon completion of such filings, the respective Mergers will become effective
in accordance with the DGCL and NLPA. The time and date on which the Mergers
become effective is herein referred to as the "Effective Time".
3
<PAGE> 8
1.7 Effects of the Mergers. At the Effective Time,
(a) The separate existence of Getty Sub shall cease and
Getty Sub shall be merged with and into Getty with Getty continuing as the
surviving corporation (as such, "New Getty");
(b) The separate existence of PTI LLC shall cease and PTI
LLC shall be merged with and into PTI with PTI continuing as the surviving
partnership (as such, "New PTI" and, together with New Getty , the "Surviving
Entities"), which will then dissolve pursuant to the provisions of the NLPA;
and
(c) The Mergers shall have all the effects of applicable
law, including, without limitation, the applicable provisions of the DGCL and
NLPA.
1.8 Certificates of Incorporation, Bylaws and Certificate
of Limited Partnership of the Surviving Entities.
(a) At the Effective Time, the certificate of
incorporation of New Getty shall be amended to read in its entirety as set forth
on Exhibit E attached hereto, and the Certificate and Agreement of Limited
Partnership of PTI as in effect immediately prior to the PTI Merger, a copy of
which is attached as Exhibit F hereto, shall be the Certificate and Agreement of
Limited Partnership of New PTI.
(b) Immediately after the Effective Time, New Getty shall
amend its bylaws (to be in effect immediately after the Effective Time, until
amended in accordance with its terms and the DGCL), if necessary, to be
substantially identical to the bylaws of Getty Sub, as in effect immediately
prior to the Effective Time.
1.9 Directors, Officers and General Partner of the
Surviving Entities. (a) The members of the Board of Directors of New Getty
will be the members of the Board of Directors of Getty Sub immediately prior to
the Effective Time and Holdings will be the general partner of New PTI. All of
the members of the Board of Directors of New Getty will serve until their
respective successors are duly elected or appointed and qualified or until
their earlier death, resignation or removal in accordance with the certificate
of incorporation and bylaws of New Getty.
(b) The officers of New Getty will consist of the
officers of Getty immediately prior to the Effective Time. Such persons will
continue as officers of New Getty until their respective successors have been
duly elected or appointed and qualified or until their earlier death,
resignation or removal in accordance with the certificate of incorporation and
bylaws of New Getty.
4
<PAGE> 9
1.10 Related Transactions.
(a) Immediately prior to the Effective Time, PTI will
sell and transfer to Getty, and Getty will acquire for cash in the amount of
$1,000 transferred to PTI, one unit of limited partnership interest in Power
Test Realty Company Limited Partnership, a New York limited partnership ("PT
Realty").
(b) Immediately after the Effective Time, CLS will sell
and transfer to Holdings, and Holdings will acquire for 28,890 shares of
Holdings Preferred Stock transferred to CLS, the general partner interest in PT
Realty.
(c) At the Effective Time, New PTI will be dissolved as a
matter of law in accordance with the provisions of the NLPA.
2. CONVERSION OF SECURITIES
2.1 Conversion of Securities.
(a) Securities of Merger Entities. As of the Effective
Time, by virtue of the Mergers and without any action on the part of the holder
of any securities of the entities involved: (i) each outstanding share of
common stock of Getty Sub, par value $.10 per share, which is issued and
outstanding immediately prior to the Effective Time, shall be converted into
and become one (1) share of common stock of New Getty and (ii) all of the
outstanding membership interests in PTI LLC outstanding immediately prior to
the Effective Time shall be converted into and become the general partnership
interest in New PTI.
(b) Securities of Getty and PTI.
(i) As of the Effective Time, by virtue of the
Getty Merger and without any action on the part of the holder of any securities
of the entities involved: except as provided in clause (c) below, each share
of Common Stock, par value $.10 per share, of Getty ("Getty Common Stock")
issued and outstanding immediately prior to the Effective Time (other than
shares of Getty Common Stock held in the treasury of Getty or owned by any of
Getty's Subsidiaries ("Getty Common Treasury Shares")) will, by virtue of the
Getty Merger, be converted into the right to receive one (1) fully paid and
nonassessable share of Holdings Common Stock (the "Getty Exchange Ratio").
Shares of Getty Common Stock other than Getty Common Treasury Shares are
referred to herein as "Getty Common Shares."
(ii) As of the Effective Time, by virtue of the
PTI Merger and without any action on the part of the holder of any securities
of the entities involved: (i) each unit of limited partnership interest in PTI
("LP Unit") outstanding immediately prior to the Effective Time will, by virtue
of the PTI Merger, be converted into the right to receive 0.44 fully paid and
nonassessable share of Holdings Preferred Stock (the "PTI Exchange Ratio") and
(ii) each unit of general partnership interest in PTI ("GP Unit") outstanding
immediately prior to the Effective
5
<PAGE> 10
Time will, by virtue of the PTI Merger, be converted into the right to receive
shares of Holdings Preferred Stock in accordance with the PTI Exchange Ratio.
The Holdings Preferred Stock will have the terms set forth in the Articles
Supplementary attached hereto as Exhibit G. Notwithstanding the foregoing
provisions of this Section 2.1(b)(ii), no LP Unit held by a Dissenting Limited
Partner (as defined below) will be deemed to be converted into Holdings
Preferred Stock hereunder and each Dissenting Limited Partner, if any, will be
entitled to payment solely from PTI of the fair value of such Dissenting
Limited Partner's LP Units to the extent permitted by and in accordance with
Sections 121-1102 and 121-1105 of the NLPA.
(iii) All Getty Common Shares to be converted into
shares of Holdings Common Stock and all LP Units and GP Units to be converted
into shares of Holdings Preferred Stock pursuant to this Section 2.1 will, by
virtue of the Mergers and without any action on the part of the holders
thereof, cease to be outstanding, be canceled and retired and cease to exist,
and each holder of a certificate or agreement previously representing any such
Getty Common Shares, LP Units or GP Units will thereafter cease to have any
rights with respect to such Getty Common Shares, LP Units or GP Units, except
the right to receive, upon the surrender of such certificate in accordance with
Section 2.2, certificates representing the number of shares of Holdings Common
Stock or Holdings Preferred Stock specified above and cash in lieu of
fractional shares of Holdings Common Stock or Holdings Preferred Stock as
contemplated by Section 2.3 (with respect to the Getty Common Shares, the
"Getty Consideration", with respect to the LP Units, the "PTI Consideration"
and with respect to the GP Units, the "CLS Consideration" and collectively, the
"Consideration").
(c) Getty Options. At the Effective Time, each holder of
a then outstanding option to purchase Getty Common Shares, whether or not then
exercisable or vested in accordance with its terms (collectively, the "Getty
Options"), which theretofore has been granted under Getty's 1985, 1988 or 1991
Stock Option Plans (the "Getty Stock Option Plans"), shall become an option to
acquire, on substantially the same terms and conditions as were applicable
under such Getty Option immediately prior to the Effective Time, except as
otherwise set forth in this Section 2.1(c), for each Getty Common Share subject
to such Getty Option the same number of shares of Holdings Common Stock as the
holder of such Getty Option would have been entitled to receive in the Getty
Merger had such holder exercised such Getty Option in full immediately prior to
the Effective Time (rounded downward to the nearest whole number), at a price
per share (rounded downward to the nearest whole cent) equal to (i) the
aggregate exercise price for Getty Common Shares purchasable pursuant to such
Getty Option (without regard to vesting provisions) divided by (ii) the number
of full shares of Holdings Common Stock deemed purchasable pursuant to such
Getty Option. Except as set forth in this Section 2.1(c), any and all rights
under any provisions of the Getty Stock Option Plans or in any other plan,
program or arrangement providing for the issuance or grant of any other
interest in respect of the capital stock of Getty or any Subsidiary thereof
shall be canceled as of the Effective Time. As soon as practicable following
the date of this Agreement, and, in any event, prior to the Effective Time, the
Board of Directors of Getty (or, if appropriate, the Compensation and Stock
Option Committee thereof) and Getty shall take all action necessary to give
effect to the provisions of this Section 2.1(c) and to ensure that no Person
shall have any right under any Getty Stock
6
<PAGE> 11
Option Plan (or any Getty Option granted thereunder) following the Effective
Time except for the right to exercise Getty Options for shares of Holdings
Common Stock as provided in this Section 2.1. As soon as practicable following
the date of this Agreement, and, in any event, prior to the Effective Time, the
Board of Directors of Getty (or, if appropriate, any committee thereof) and
Getty shall take all action necessary to either terminate any other plan,
program or arrangement with respect to, including any right to acquire, equity
securities of Getty, or to amend or modify such other plans, programs or
arrangements to provide for the issuance of shares of Holdings Common Stock in
lieu of equity securities of Getty or New Getty.
(d) Cancellation of Shares. All shares of Holdings
Common Stock outstanding immediately prior to the Effective Time and all Getty
Common Treasury Shares will be cancelled.
2.2 Payment for Getty Common Shares, LP Units and GP
Units. (a) At the Effective Time, (i) Getty and PTI will cause Holdings to
make available to such bank or trust company as may be selected by Getty and
reasonably acceptable to PTI (the "Exchange Agent"), for the benefit of the
holders of Getty Common Shares, LP Units and GP Units, a sufficient number of
certificates representing shares of Holdings Common Stock and Holdings
Preferred Stock to effect the delivery of the aggregate Consideration pursuant
to Section 2.1(b) (the certificates representing shares of Holdings Common
Stock and Holdings Preferred Stock and any cash delivered to the Exchange Agent
pursuant to Section 2.3 comprising the aggregate Consideration, being
hereinafter referred to as the "Exchange Fund"). The Exchange Agent will,
pursuant to irrevocable instructions, deliver the shares of Holdings Common
Stock and Holdings Preferred Stock contemplated to be issued pursuant to
Section 2.1(b) out of the Exchange Fund, and, except as provided in Section
2.3, the Exchange Fund will not be used for any other purpose.
(b) Promptly after the Effective Time, the Exchange Agent
will mail to each holder of record of a certificate or certificates which
immediately prior to the Effective Time represented outstanding Getty Common
Shares, LP Units or GP Units (the "Certificates") (i) a form of letter of
transmittal (which will specify that delivery will be effected, and risk of
loss and title to the Certificates will pass, only upon proper delivery of the
Certificates, to the Exchange Agent) and (ii) instructions for use in effecting
the surrender of the Certificates for payment therefor, including instructions
designed to provide Holdings with information relating to the tax basis of LP
Units and GP Units.
(c) Upon surrender of Certificates for cancellation to
the Exchange Agent, together with such letter of transmittal duly executed and
any other required documents, the holder of such Certificates will be entitled
to receive for each Getty Common Share represented by such Certificates the
Getty Consideration, for each LP Unit represented by such Certificates the PTI
Consideration, and for each GP Unit represented by such Certificates, the CLS
Consideration, and the Certificates so surrendered will promptly be canceled.
Until so surrendered, Certificates will represent solely the right to receive
the Consideration and holders thereof shall not be holders of record of
Holdings. No dividends or other distributions that are
7
<PAGE> 12
declared payable to the holders of record of shares of Holdings Common Stock or
Holdings Preferred Stock after the Effective Time will be paid to Persons
entitled by reason of the Mergers to receive shares of Holdings Common Stock or
Holdings Preferred Stock until such Persons surrender their Certificates.
Upon such surrender, there will be paid to the Person in whose name the shares
of Holdings Common Stock or Holdings Preferred Stock are issued any dividends
or other distributions on such shares of Holdings Common Stock or Holdings
Preferred Stock which have a record date after the Effective Time and prior to
such surrender, and a payment date prior to such surrender. In no event will
the Persons entitled to receive such dividends or other distributions be
entitled to receive interest on such dividends or other distributions.
If any cash or certificate representing shares of Holdings Common Stock or
Holdings Preferred Stock is to be paid to or issued in a name other than that
in which the Certificate surrendered in exchange therefor is registered, it
will be a condition of such exchange that the Certificate so surrendered be
properly endorsed and otherwise in proper form for transfer and that the Person
requesting such exchange pay to the Exchange Agent any transfer or other taxes
required by reason of the issuance of certificates for such shares of Holdings
Common Stock or Holdings Preferred Stock in a name other than that of the
registered holder of the Certificate surrendered, or establish to the
satisfaction of the Exchange Agent that such tax has been paid or is not
applicable. Notwithstanding the foregoing, neither the Exchange Agent nor any
party hereto will be liable to a holder of Getty Common Shares, LP Units or GP
Units for any shares of Holdings Common Stock or Holdings Preferred Stock or
dividends thereon or, in accordance with Section 2.3, cash in lieu of
fractional shares of Holdings Common Stock or Holdings Preferred Stock,
delivered to a public official pursuant to applicable abandoned property,
escheat or similar law. The Exchange Agent will not be entitled to vote or
exercise any rights of ownership with respect to such shares of Holdings Common
Stock or Holdings Preferred Stock for the account of the Persons entitled
thereto.
(d) Any portion of the Exchange Fund that remains
unclaimed by the former holders of Getty Common Stock, LP Units or GP Units for
twelve (12) months after the Effective Time will be delivered to Holdings and
any former holders of Getty Common Stock, LP Units or GP Units will thereafter
look only to Holdings for payment of their claim for the Consideration.
2.3 Fractional Shares. No fractional shares of Holdings
Common Stock or Holdings Preferred Stock will be issued in the Mergers. In
lieu of any such fractional securities, each holder of Getty Common Shares, LP
Units or GP Units who would otherwise have been entitled to a fraction of a
share of Holdings Common Stock or Holdings Preferred Stock upon surrender of
Certificates for exchange pursuant to this Article 2 will be paid an amount in
cash (without interest), rounded to the nearest cent, determined by multiplying
(a) with respect to fractional shares of Holdings Common Stock, (i) the average
of the closing prices of Holdings Common Stock (as reported on the NYSE
Composite Transactions Reporting System) on the ten (10) consecutive days on
which shares of Holdings Common Stock actually trade preceding the date of the
Effective Time (or, if Holdings Common Stock does not trade on the New York
Stock Exchange, Inc. (the "NYSE"), on any or all of such days, the ten (10)
consecutive trading days commencing with the first date of trading of Holdings
Common Stock on the NYSE after the Effective Time) by (ii) the fractional
interest to which such holder otherwise would be entitled,
8
<PAGE> 13
or (b) with respect to fractional shares of Holdings Preferred Stock, (i) the
average of the closing prices of Holdings Preferred Stock (as reported on the
NYSE Composite Transactions Reporting System) on the ten (10) consecutive days
on which shares of Holdings Preferred Stock actually trade preceding the date
of the Effective Time (or, if Holdings Preferred Stock does not trade on the
NYSE, on any or all of such days, the ten (10) consecutive trading days
commencing with the first date of trading of Holdings Preferred Stock on the
NYSE after the Effective Time) by (ii) the fractional interest to which such
holder otherwise would be entitled. Promptly upon request from the Exchange
Agent, Holdings will make available to the Exchange Agent the cash necessary
for this purpose.
2.4 Dissenters' Rights.
(a) Notwithstanding the provisions of Section 2.1 or any
other provision of this Agreement to the contrary, the LP Units that are
outstanding immediately prior to the Effective Date and are held by limited
partners of PTI who have not voted such units in favor of the adoption of this
Agreement and who dissent in accordance with Section 121-1102 of the NLPA (the
"Dissenting Limited Partners"), will not be converted as provided in Section
2.1(b) at or after the Effective Time unless and until such Dissenting Limited
Partner fails to perfect or effectively withdraws or loses such right to
dissent under the NLPA. If a Dissenting Limited Partner so fails to perfect or
effectively withdraws or loses such right to dissent, then, as of the Effective
Time or the occurrence of such event, whichever last occurs, such Dissenting
Limited Partner's LP Units will be converted into and represent solely the
right provided in Section 2.1(b)(ii) and (iii).
(b) PTI will give Holdings (i) prompt written notice of
the existence of any Dissenting Limited Partners and any instruments served
pursuant to Section 121-1102(b) of the NLPA and received by PTI and (ii) the
opportunity to participate in all negotiations and proceedings regarding such
Dissenting Limited Partners under Section 121-1105 of the NLPA. PTI will not
voluntarily make any payment with respect to any demands of Dissenting Limited
Partners and will not, except with the prior written consent of Holdings,
settle or offer to settle any such demands.
2.5 No Transfer after the Effective Time. No transfers
of Getty Common Shares will be made on the stock transfer books of Getty, and
no transfers of LP Units or GP Units will be made on the books of PTI, after
the close of business on the day prior to the date of the Effective Time.
3. REPRESENTATIONS AND WARRANTIES OF GETTY
Getty hereby represents and warrants to PTI as follows:
3.1 Existence; Good Standing; Corporate Authority.
Getty and each of its Subsidiaries is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, with the
power and authority to own and operate its businesses as
9
<PAGE> 14
presently conducted. Getty and each of its Subsidiaries is duly qualified as a
foreign corporation or other entity to do business and is in good standing in
each jurisdiction where the character of its Properties or the nature of its
activities makes such qualification necessary, except for such failures of
Getty and any of its Subsidiaries to be so qualified as would not have a
Material Adverse Effect. Getty has previously provided PTI with true and
correct copies of its certificate of incorporation and bylaws and the charter
documents and bylaws or other organizational documents of each of its
Subsidiaries, as currently in effect.
3.2 Authorization; Validity and Effect of Agreement.
Getty has the requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement, every other document or agreement
to be executed by Getty under this Agreement (each a "Getty Transaction
Document") and to consummate the transactions contemplated hereby and thereby.
The execution and delivery of this Agreement by Getty and the performance by
Getty of its obligations hereunder, the execution and delivery of each of the
Getty Transaction Documents by Getty and the performance of its obligations
thereunder and the consummation of the transactions contemplated hereby and
thereby have been duly authorized by the Board of Directors of Getty and all
other necessary corporate action on the part of Getty, other than the adoption
and approval of this Agreement by the stockholders of Getty, and no other
corporate proceedings on the part of Getty are necessary to authorize this
Agreement, the Getty Transaction Documents and the transactions contemplated
hereby and thereby. The Board of Directors of Getty, pursuant to the
recommendation of the Special Committee, has approved for the purposes of
Section 251(b) of the DGCL the agreement of merger contained in this Agreement
and the Getty Merger. This Agreement has been duly and validly executed and
delivered by Getty and constitutes a legal, valid and binding obligation of
Getty, enforceable against it in accordance with its terms, except to the
extent that such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally or by general principles of equity. Each Getty
Transaction Document has been or, as of the Effective Time, will have been,
duly and validly authorized, executed and delivered by Getty, and constitutes
or will constitute as of such time a legally valid and binding obligation of
Getty, enforceable against it in accordance with its terms, except to the
extent that such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally or by general principles of equity.
3.3 Capitalization. The authorized capital stock of
Getty consists of 30,000,000 shares of Getty Common Stock and 10,000,000 shares
of preferred stock having a par value of $1.00 per share ("Getty Preferred
Stock"), none of which shares have been designated. As of the date hereof,
13,393,774 shares of Getty Common Stock and no shares of Getty Preferred Stock
are issued and outstanding. 883,316 shares of Getty Common Stock are held in
Getty's treasury. All of the issued and outstanding shares of Getty Common
Stock are validly issued, fully paid and non-assessable and no class of Getty
stock is entitled to preemptive rights. As of the date hereof, except for
Getty's 1985, 1988 and 1991 Stock Option Plans, there are no existing options,
warrants, calls, subscriptions, convertible securities or other securities,
agreements, commitments, or obligations which would require Getty to issue or
sell shares of
10
<PAGE> 15
Getty Common Stock, Getty Preferred Stock or any other equity securities, or
securities convertible into or exchangeable or exercisable for shares of Getty
Common Stock, Getty Preferred Stock or any other equity securities of Getty or
any of its Subsidiaries. Getty has no commitments or obligations to purchase
or redeem any shares of Getty Common Stock.
3.4 Subsidiaries. The only Subsidiaries of Getty are
those set forth in Section 3.4 of the Disclosure Schedule. All of the
outstanding shares of capital stock and other ownership interests of each of
Getty's Subsidiaries are validly issued, fully paid, non- assessable and free
of preemptive rights or rights of first refusal. Except as set forth in
Section 3.4 of the Disclosure Schedule, Getty owns, directly or indirectly, all
of the issued and outstanding capital stock and other ownership interests of
each of its Subsidiaries, free and clear of all Encumbrances, and there are no
existing options, warrants, calls, subscriptions, convertible securities or
other securities, agreements, commitments or obligations of any character
relating to the outstanding capital stock or other securities of any Subsidiary
of Getty or which would require any Subsidiary of Getty to issue or sell any
shares of its capital stock, ownership interests or securities convertible into
or exchangeable for shares of its capital stock or ownership interests.
3.5 Other Interests. Except as set forth in Section 3.5
of the Disclosure Schedule, neither Getty nor any of Getty's Subsidiaries owns,
directly or indirectly, any interest or investment (whether equity or debt) in
any corporation, partnership, limited liability company, joint venture,
business, trust or other Person (other than Getty Subsidiaries).
3.6 No Conflict; Required Filings and Consents. (a)
Except as set forth in Section 3.6(a) of the Disclosure Schedule, neither the
execution and delivery of this Agreement and the Getty Transaction Documents,
nor the performance by Getty of its obligations hereunder and thereunder, nor
the consummation of the transactions contemplated hereby or thereby, will: (i)
assuming receipt of the Getty Stockholder Approvals (as defined below),
conflict with Getty's certificate of incorporation or bylaws; (ii) assuming
satisfaction of the requirements set forth in Section 3.6(b) below, violate any
statute, law, ordinance, rule or regulation applicable to Getty or any of its
Subsidiaries or any of their Properties or assets; or (iii) violate, breach, be
in conflict with or constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, or permit the
termination of any provision of, or result in the termination of, the
acceleration of the maturity of, or the acceleration of the performance of any
obligation of Getty or any of its Subsidiaries, or result in the creation or
imposition of any Encumbrance upon any Properties, assets or business of Getty
or any of its Subsidiaries under, any note, bond, indenture, mortgage, deed of
trust, lease, franchise, permit, authorization, license, contract, instrument
or other agreement or commitment or any order, judgment or decree to which
Getty or any of its Subsidiaries is a party or by which Getty or any of its
Subsidiaries or any of their respective assets or Properties is bound or
encumbered, or give any Person the right to require Getty or any of its
Subsidiaries to purchase or repurchase any notes, bonds or instruments of any
kind except, in each case, for such violations, conflicts, defaults or other
occurrences which would not have, and would not reasonably be expected to have,
a Material Adverse Effect.
11
<PAGE> 16
(b) Except (i) for applicable requirements, if any, of
the Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (the "Exchange Act"), the Securities Act of 1933, as amended, and
the rules and regulations thereunder (the "Securities Act"), and state
securities or "blue sky" laws ("Blue Sky Laws"), (ii) for the filing of
certificates of merger pursuant to the DGCL, (iii) for the Getty Stockholder
Approvals (as defined below) or (iv) with respect to matters set forth in
Sections 3.6(a) or 3.6(b) of the Disclosure Schedule, no consent, approval or
authorization of, permit from, or declaration, filing or registration with, any
governmental or regulatory authority, or any other Person is required to be
made or obtained by Getty or its Subsidiaries in connection with the execution,
delivery and performance of this Agreement, the Getty Transaction Documents and
the consummation of the transactions contemplated hereby and thereby except
where the failure to obtain such consent, approval, authorization, permit or
declaration or to make such filing or registration would not have a Material
Adverse Effect.
3.7 Compliance. Except as set forth in Section 3.7 of
the Disclosure Schedule, to the best knowledge of Getty, Getty and each of its
Subsidiaries is in compliance with all foreign, federal, state and local laws
and regulations applicable to its operations or with respect to which
compliance is a condition of engaging in the business thereof (including,
without limitation, all Environmental Laws), except to the extent that failure
to comply would not have a Material Adverse Effect. Except as set forth in
Section 3.7 of the Disclosure Schedule, to the best knowledge of Getty, neither
Getty nor any of its Subsidiaries has received any notice asserting a failure,
or possible failure, to comply with any such law or regulation, the subject of
which notice has not been resolved as required thereby or otherwise to the
satisfaction of the party sending the notice, except for such failure as would
not have a Material Adverse Effect. Getty and its Subsidiaries have all
material permits, licenses and franchises from governmental agencies required
to conduct their respective businesses as they are now being conducted and all
such permits, licenses and franchises will remain in effect after the Effective
Time, except for such failures to remain effective that would not have a
Material Adverse Effect.
3.8 SEC Documents. (a) Getty has delivered or made
available to PTI true and complete copies of each registration statement, proxy
or information statement, form, report and other documents required to be filed
by it with the Securities and Exchange Commission (the "SEC") since February 1,
1996 (collectively, the "Getty SEC Reports"). As of their respective dates,
the Getty SEC Reports and any registration statements, reports, forms, proxy or
information statements and other documents filed by Getty with the SEC after
the date of this Agreement (i) complied or, with respect to those not yet
filed, will comply, in all material respects with the applicable requirements
of the Securities Act and the Exchange Act and (ii) did not or, with respect to
those not yet filed, will not, contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements made therein, in the light of the circumstances under which
they were made, not misleading.
(b) Each of the consolidated balance sheets of Getty
included in or incorporated by reference into the Getty SEC Reports (including
the related notes and schedules) presents fairly, in all material respects, the
consolidated financial position of Getty and its
12
<PAGE> 17
consolidated Subsidiaries as of its date, and each of the consolidated
statements of operations and cash flows of Getty included in or incorporated by
reference into the Getty SEC Reports (including any related notes and
schedules) presents fairly, in all material respects, the results of operations
or cash flows, as the case may be, of Getty and its Subsidiaries for the
periods set forth therein (subject, in the case of unaudited statements, to
normal year-end audit adjustments), in each case in accordance with GAAP
consistently applied during the periods involved, except as may be noted
therein.
(c) To the best knowledge of Getty, neither Getty nor any
of its Subsidiaries has any liabilities or obligations of any nature (whether
accrued, absolute, contingent or otherwise) that would be required to be
reflected on, or reserved against in, a balance sheet of Getty or in the notes
thereto, prepared in accordance with GAAP consistently applied, except for (i)
liabilities or obligations that were so reserved on, or reflected in (including
the notes to), the consolidated balance sheet of Getty as of January 31, 1997
and (ii) liabilities or obligations arising in the ordinary course of business
(including trade indebtedness) since January 31, 1997 which would not have a
Material Adverse Effect.
3.9 Litigation. Except as set forth in Section 3.9 of
the Disclosure Schedule or the Getty SEC Reports, there is no Action
instituted, pending or, to the best knowledge of Getty, threatened, which, if
adversely decided, would, directly or indirectly, have a Material Adverse
Effect, nor is there any outstanding judgment, decree, or injunction or any
statute, rule or order of any domestic or foreign court, governmental
department, commission or agency which has or would have a Material Adverse
Effect.
3.10 Absence of Certain Changes. Except as set forth in
Section 3.10 of the Disclosure Schedule or the Getty SEC Reports and except for
the transactions expressly contemplated hereby, since January 31, 1997, Getty
and its Subsidiaries have conducted their respective businesses only in the
ordinary and usual course consistent with past practices and there has not been
any change in Getty' business, operations, condition (financial or otherwise),
results of operations, assets, liabilities, working capital or reserves, except
for changes contemplated hereby or changes which have not had a Material
Adverse Effect. Except as set forth in Section 3.10 of the Disclosure Schedule
or the Getty SEC Reports, from January 31, 1997 through the date of this
Agreement, neither Getty nor any of its Subsidiaries has taken any of the
actions prohibited by Section 5.1 hereof.
3.11 Environmental Matters. Except as set forth in
Section 3.11 of the Disclosure Schedule, (i) there are no existing uncured
notices of noncompliance, notices of violation, administrative actions, or
lawsuits against Getty or any of its Subsidiaries arising under Environmental
Laws or relating to the use, handling, storage, treatment, recycling,
generation, or release of Hazardous Materials at any of the Properties, nor has
Getty received any uncured notification of any allegation of any responsibility
for any disposal, release, or threatened release at any location of any
Hazardous Materials, except in any such case which would not be reasonably
expected to have a Material Adverse Effect; (ii) there have been no spills or
releases of Hazardous Materials at any of the Properties in excess of
quantities reportable under
13
<PAGE> 18
Environmental Laws, except in any such case which would not be reasonably
expected to have a Material Adverse Effect; (iii) there are no consent decrees,
consent orders, judgments, judicial or administrative orders, or Encumbrances
by any governmental authority relating to any Environmental Law which have not
already been fully satisfied and which regulate, obligate, or bind Getty or any
of its Subsidiaries, except in any such case which would not be reasonably
expected to have a Material Adverse Effect; and (iv) except as set forth in
Section 3.11 of the Disclosure Schedule, no Properties or Facilities are listed
on the federal National Priorities List, the federal Comprehensive
Environmental Response Compensation Liability Information System list, or any
similar state listing of sites known to be contaminated with Hazardous
Materials.
3.12 State Takeover Statutes. Article X, Section 1 of
Getty's By-Laws contains a provision expressly electing not to be governed by
Section 203 of the DGCL. Such provision is sufficient to render inapplicable
to this Agreement and the transactions contemplated hereby the restrictions on
business combinations contained in Section 203 of the DGCL.
3.13 No Brokers. Except fees to be paid to Furman Selz
LLC (the arrangements of which have been disclosed to PTI prior to the date
hereof), no broker, finder, investment banker, or other Person or firm is
entitled to any brokerage, finder's or other similar fee or commission in
connection with this Agreement or the transactions contemplated hereby based
upon arrangements made by or on behalf of Getty, any of its Subsidiaries or any
of their respective directors, officers or employees.
3.14 Opinion of Financial Advisor. Getty has received
the opinion of Furman Selz LLC to the effect that, as of the date thereof, the
Getty Exchange Ratio is fair to the holders of Getty Common Stock from a
financial point of view. Getty has delivered to PTI a true, complete and
correct copy of such opinion.
3.15 Information in Joint Proxy Statement/Prospectus and
Form S-4. Information supplied by Getty or any of its Subsidiaries for
inclusion or incorporation by reference in (i) the Joint Proxy
Statement/Prospectus (as hereinafter defined) (or any amendment thereof or
supplement thereto), at the date mailed to Getty stockholders and PTI
unitholders and at the time of the respective meetings of the Getty
stockholders and of the PTI unitholders contemplated hereby or (ii) the Form
S-4 (as hereinafter defined) at any time the Form S-4 is filed with the SEC, at
any time it is amended or supplemented and at any time it becomes effective
under the Securities Act, will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading.
3.16 Hart-Scott-Rodino. Getty and its Subsidiaries do
not have assets, other than assets which are exempt from the requirements of
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), and the rules and regulations thereunder (the "Rules"), pursuant to
Section 7A(c)(2) of the HSR Act and Sections 802.2, 802.3 or 802.5 of the
Rules, with an aggregate fair market value of greater than $15 million.
14
<PAGE> 19
4. REPRESENTATIONS AND WARRANTIES OF PTI
PTI hereby represents and warrants to Getty as follows:
4.1 Existence; Good Standing; Authority. Each of PTI
and PT Realty is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, with the power and authority
to own and operate its businesses as presently conducted. Each of PTI and PT
Realty is duly qualified as a foreign corporation or other entity to do
business and is in good standing in each jurisdiction where the character of
its Properties owned or held under lease or the nature of its activities makes
such qualification necessary, except for such failures of PTI or PT Realty to
be so qualified as would not have a Material Adverse Effect. PTI has previously
provided Getty with true and correct copies of its certificate and agreement of
limited partnership ("Partnership Agreement") or other organizational documents
and the certificate and agreement of limited partnership or other
organizational documents of PT Realty, as currently in effect.
4.2 Authorization; Validity and Effect of Agreement.
PTI has the requisite partnership power and authority to execute, deliver and
perform its obligations under this Agreement and each other document or
agreement to be executed by PTI under this Agreement (each a "PTI Transaction
Document") and to consummate the transactions contemplated hereby and thereby.
The execution and delivery of this Agreement by PTI and the performance by PTI
of its obligations hereunder, the execution and delivery of each of the PTI
Transaction Documents by PTI and the performance of its obligations thereunder
and the consummation of the transactions contemplated hereby and thereby have
been duly authorized by CLS and all other necessary partnership action on the
part of PTI, other than the adoption and approval of this Agreement by holders
of LP Units, and no other partnership proceedings on the part of PTI are
necessary to authorize this Agreement, the PTI Transaction Documents and the
transactions contemplated hereby and thereby. CLS has approved for the purposes
of Section 121-1106 of the NLPA the agreement of merger contained in this
Agreement and the PTI Merger. This Agreement has been duly and validly
executed and delivered by PTI and constitutes a legal, valid and binding
obligation of PTI, enforceable against it in accordance with its terms, except
to the extent that such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally or by general principles of equity. Each PTI
Transaction Document has been or, as of the Effective Time, will have been,
duly and validly authorized, executed and delivered by PTI, and constitutes or
will constitute as of such time a legally valid and binding obligation of PTI,
enforceable against it in accordance with its terms, except to the extent that
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the enforcement of
creditors' rights generally or by general principles of equity.
4.3 Capitalization. As of December 8, 1997, there were
561 holders of record of LP Units. All of the LP Units have been duly
authorized by the Partnership Agreement and are validly issued and fully paid
and no LP Units are subject to preemptive rights. CLS is the sole general
partner of PTI with a general partner interest in PTI of 21.0%. All of the GP
Units have
15
<PAGE> 20
been duly authorized by the Partnership Agreement, are validly issued to CLS
and are fully paid and no GP Units are subject to preemptive rights. CLS has
advised PTI that it owns the GP Units free and clear of all Encumbrances.
Except as set forth on Section 4.3 of the Disclosure Schedule, there are no
existing options, warrants, calls, subscriptions, convertible securities or
other securities, agreements other than this Agreement, commitments, or
obligations which would require PTI to issue or sell LP Units or GP Units, or
securities convertible into or exchangeable or exercisable for LP Units or GP
Units as of the date hereof. Except as set forth on Section 4.3 of the
Disclosure Schedule, PTI has no commitments or obligations to purchase or
redeem any LP Units or GP Units.
4.4 Subsidiaries. PT Realty is the only Subsidiary of
PTI. CLS is the sole general partner of PT Realty with a general partner
interest in PT Realty of 1%. PTI is the sole limited partner of PT Realty with
a limited partner interest in PT Realty of 99%. CLS's general partner interest
in PT Realty and PTI's limited partner interest in PT Realty are duly
authorized by PT Realty's certificate and agreement of limited partnership, are
validly issued and are fully paid. CLS has, (a) in its capacity as sole
general partner of PT Realty, advised PTI that CLS owns such general partner
interests free and clear of all Encumbrances, and (b) in its capacity as sole
general partner of PTI, advised PTI that PTI owns the limited partnership
interests in PT Realty free and clear of all Encumbrances. Except as set forth
in Section 4.4 of the Disclosure Schedule, there are no existing options,
warrants, calls, subscriptions, convertible securities or other securities,
agreements, commitments or obligations which would require PT Realty to issue
or sell any of its ownership interests or securities convertible into or
exchangeable for its ownership interests.
4.5 Other Interests. Except as set forth in Section 4.5
of the Disclosure Schedule, neither PTI nor PT Realty owns, directly or
indirectly, any interest or investment (whether equity or debt) in any
corporation, partnership, limited liability company, joint venture, business,
trust or other Person (other than PT Realty).
4.6 No Conflict; Required Filings and Consents. (a)
Except as set forth in Section 4.6(a) of the Disclosure Schedule, neither the
execution and delivery of this Agreement and the PTI Transaction Documents, nor
the performance by PTI of its obligations hereunder and thereunder, nor the
consummation of the transactions contemplated hereby or thereby, will: (i)
assuming receipt of the PTI Unitholder Approvals (as defined below), conflict
with the Partnership Agreement; (ii) assuming satisfaction of the requirements
set forth in Section 4.6(b) below, violate any statute, law, ordinance, rule or
regulation, applicable to PTI or PT Realty or any of their Properties or
assets; or (iii) violate, breach, be in conflict with or constitute a default
(or an event which, with notice or lapse of time or both, would constitute a
default) under, or permit the termination of any provision of, or result in the
termination of, the acceleration of the maturity of, or the acceleration of the
performance of any obligation of PTI or PT Realty, or result in the creation or
imposition of any Encumbrance upon any Properties, assets or business of PTI or
PT Realty under, any note, bond, indenture, mortgage, deed of trust, lease,
franchise, permit, authorization, license, contract, instrument or other
agreement or commitment or any order, judgment or decree to which PTI or PT
Realty is a party or by which PTI or PT Realty or
16
<PAGE> 21
any of their respective assets or Properties is bound or encumbered, or give
any Person the right to require PTI or PT Realty to purchase or repurchase any
notes, bonds or instruments of any kind except, in each case, for such
violations, conflicts, defaults or other occurrences which would not have, and
would not reasonably be expected to have, a Material Adverse Effect.
(b) Except (i) for applicable requirements, if any, of
the Exchange Act, the Securities Act and Blue Sky Laws, (ii) for the filing of
certificates of merger pursuant to the NLPA, (iii) for the PTI Unitholder
Approvals (as defined below) or (iv) with respect to matters set forth in
Sections 4.6(a) or 4.6(b) of the Disclosure Schedule, no consent, approval or
authorization of, permit from, or declaration, filing or registration with, any
governmental or regulatory authority, or any other Person is required to be
made or obtained by PTI or PT Realty in connection with the execution, delivery
and performance of this Agreement, the PTI Transaction Documents and the
consummation of the transactions contemplated hereby and thereby except where
the failure to obtain such consent, approval, authorization, permit or
declaration or to make such filing or registration would not have a Material
Adverse Effect.
4.7 Compliance. Except as set forth in Section 4.7 of
the Disclosure Schedule, to the best knowledge of PTI, each of PTI and PT
Realty is in compliance with all foreign, federal, state and local laws and
regulations applicable to its operations or with respect to which compliance is
a condition of engaging in the business thereof (including, without limitation,
all Environmental Laws), except to the extent that failure to comply would not
have a Material Adverse Effect. Except as set forth in Section 4.7 of the
Disclosure Schedule, to the best knowledge of PTI, neither PTI nor PT Realty
has received any notice asserting a failure, or possible failure, to comply
with any such law or regulation, the subject of which notice has not been
resolved as required thereby or otherwise to the satisfaction of the party
sending the notice, except for such failure as would not have a Material
Adverse Effect. PTI and PT Realty have all material permits, licenses and
franchises from governmental agencies required to conduct their respective
businesses as they are now being conducted and all such permits, licenses and
franchises will remain in effect after the Effective Time, except for such
failure to remain effective that would not have a Material Adverse Effect.
4.8 SEC Documents. (a) PTI has delivered or made
available to Getty true and complete copies of each registration statement,
proxy or information statement, form, report and other documents required to be
filed by it with the SEC since January 1, 1996 (collectively, the "PTI SEC
Reports"). As of their respective dates, the PTI SEC Reports and any
registration statements, reports, forms, proxy or information statements and
other documents filed by PTI with the SEC after the date of this Agreement (i)
complied or, with respect to those not yet filed, will comply, in all material
respects with the applicable requirements of the Securities Act and the
Exchange Act and (ii) did not or, with respect to those not yet filed, will
not, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
made therein, in the light of the circumstances under which they were made, not
misleading.
17
<PAGE> 22
(b) Each of the consolidated balance sheets of PTI
included in or incorporated by reference into the PTI SEC Reports (including
the related notes and schedules) presents fairly, in all material respects, the
consolidated financial position of PTI and PT Realty as of its date, and each
of the consolidated statements of income and cash flows of PTI included in or
incorporated by reference into the PTI SEC Reports (including any related notes
and schedules) presents fairly, in all material respects, the results of
operations or cash flows, as the case may be, of PTI and PT Realty for the
periods set forth therein (subject, in the case of unaudited statements, to
normal year-end audit adjustments), in each case in accordance with GAAP
consistently applied during the periods involved, except as may be noted
therein.
(c) To the best knowledge of PTI, neither PTI nor PT
Realty has any liabilities or obligations of any nature (whether accrued,
absolute, contingent or otherwise) that would be required to be reflected on,
or reserved against in, a balance sheet of PTI or in the notes thereto,
prepared in accordance with GAAP consistently applied, except for (i)
liabilities or obligations that were so reserved on, or reflected in (including
the notes to), the consolidated balance sheet of PTI as of December 31, 1996
and (ii) liabilities or obligations arising in the ordinary course of business
(including trade indebtedness) since December 31, 1996 which would not have a
Material Adverse Effect.
4.9 Litigation. Except as set forth in Section 4.9 of
the Disclosure Schedule or the PTI SEC Reports, there is no Action instituted,
pending or, to the best knowledge of PTI, threatened, which, if adversely
decided, would, directly or indirectly, have a Material Adverse Effect, nor is
there any outstanding judgment, decree, or injunction or any statute, rule or
order of any domestic or foreign court, governmental department, commission or
agency which has or would have any Material Adverse Effect.
4.10 Absence of Certain Changes. Except as set forth in
Section 4.10 of the Disclosure Schedule or the PTI SEC Reports and except for
the transactions expressly contemplated hereby, since December 31, 1996, PTI
and PT Realty have conducted their respective businesses only in the ordinary
and usual course consistent with past practices and there has not been any
change in PTI's business, operations, condition (financial or otherwise),
results of operations, assets, liabilities, working capital or reserves, except
for changes contemplated hereby or changes which have not had a Material
Adverse Effect. Except as set forth in Section 4.10 of the Disclosure Schedule
or the PTI SEC Reports, from December 31, 1996 through the date of this
Agreement, neither PTI nor PT Realty has taken any of the actions prohibited by
Section 5.1 hereof.
4.11 Environmental Matters. Except as set forth in
Section 4.11 of the Disclosure Schedule, (i) there are no existing uncured
notices of noncompliance, notices of violation, administrative actions, or
lawsuits against PTI or PT Realty arising under Environmental Laws or relating
to the use, handling, storage, treatment, recycling, generation, or release of
Hazardous Materials at any of the Properties, nor has PTI received any uncured
notification of any allegation of any responsibility for any disposal, release,
or threatened release at any location of any Hazardous Materials, except in any
such case which would not be
18
<PAGE> 23
reasonably expected to have a Material Adverse Effect; (ii) there have been no
spills or releases of Hazardous Materials at any of the Properties in excess of
quantities reportable under Environmental Laws, except in any such case which
would not be reasonably expected to have a Material Adverse Effect; (iii) there
are no consent decrees, consent orders, judgments, judicial or administrative
orders, or Encumbrances by any governmental authority relating to any
Environmental Law which have not already been fully satisfied and which
regulate, obligate, or bind PTI or PT Realty, except in any such case which
would not be reasonably expected to have a Material Adverse Effect; and (iv)
except as set forth in Section 4.11 of the Disclosure Schedule, no Properties
or Facilities are listed on the federal National Priorities List, the federal
Comprehensive Environmental Response Compensation Liability Information System
list, or any similar state listing of sites known to be contaminated with
Hazardous Materials.
4.12 State Takeover Statutes. There is no "fair price",
"merger moratorium", "control share acquisition" or other anti-takeover
statute or similar statute or regulation that would be applicable to the PTI
Merger.
4.13 No Brokers. Except for fees to be paid to CIBC
Oppenheimer Corp. (the arrangements of which have been disclosed to Getty prior
to the date hereof), no broker, finder, investment banker, or other Person or
firm is entitled to any brokerage, finder's or other similar fee or commission
in connection with this Agreement or the transactions contemplated hereby based
upon arrangements made by or on behalf of PTI, PT Realty or any of their
respective partners, directors, officers or employees.
4.14 Opinion of Financial Advisor. PTI has received the
opinion of CIBC Oppenheimer Corp. to the effect that, as of the date thereof,
the PTI Exchange Ratio is fair to the holders of LP Units from a financial
point of view. PTI has delivered to Getty a true, complete and correct copy of
such opinion.
4.15 Information in Joint Proxy Statement/Prospectus and
Form S-4. Information supplied by PTI or PT Realty for inclusion or
incorporation by reference in (i) the Joint Proxy Statement/Prospectus (or any
amendment thereof or supplement thereto), at the date mailed to Getty
stockholders and to PTI unitholders and at the time of the respective meetings
of the stockholders of Getty and of the unitholders of PTI contemplated hereby
or (ii) the Form S-4 at any time the Form S-4 is filed with the SEC, at any
time it is amended or supplemented and at any time it becomes effective under
the Securities Act, will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading.
4.16 Hart-Scott-Rodino. PTI and PT Realty do not have
assets, other than assets which are exempt from the HSR Act pursuant to Section
7A(c)(2) of the HSR Act and Sections 802.2, 802.3 or 802.5 of the Rules, with
an aggregate fair market value of greater than $15 million.
19
<PAGE> 24
5. COVENANTS
5.1 Conduct of Business by Getty or PTI. Commencing the
date after the date hereof and at all times prior to the Effective Time or the
date, if any, on which this Agreement is earlier terminated pursuant to Article
7 hereof (the "Termination Date"), and except as may be required pursuant to
this Agreement, or as disclosed or contemplated in the Disclosure Schedule
(including the agreements and contemplated agreements referred to therein, and
the consummation of the transactions contemplated by such agreements) or as may
be consented to in writing by the other, Getty and PTI:
(a) shall, and shall cause each of their respective
Subsidiaries to, conduct their respective operations according to their
ordinary and usual course of business;
(b) shall, and shall cause each of their respective
Subsidiaries to, use their best efforts to preserve intact their respective
business organizations and good will in all material respects, keep available
the services of their respective partners, officers and employees as a group
and maintain satisfactory relations with lessees, suppliers, distributors,
customers, banks and others having business relationships with them;
(c) shall confer on a regular and frequent basis with one
or more representatives of the other to report operational matters of a
material nature and the general status of ongoing operations, subject to
compliance with applicable law;
(d) shall notify the other of any emergency or other
change in the normal course of their or their respective Subsidiaries'
respective businesses or in the operation of their or their respective
Subsidiaries' Properties and of any governmental complaints, investigations or
hearings (or communications indicating that the same may be contemplated) if
such emergency, change, complaint, investigation or hearing or the effect
thereof would be material to the business, operations or financial condition of
either Getty or PTI and their respective Subsidiaries, as the case may be,
taken as a whole;
(e) shall not declare or pay any dividends on their
outstanding shares of capital stock or make any partnership distributions,
other than ordinary course dividends or distributions consistent with past
practice, provided, that immediately prior to the Effective Time, PTI may
declare and pay a distribution consistent with past practice only for the
period from January 1, 1998 to the Effective Time;
(f) shall not, except as otherwise provided in this
Agreement, enter into or amend in any material respect any employment,
severance or similar agreement or any agreement or agreement in principle with
respect to, any merger, consolidation or business combination (other than the
Mergers), any acquisition of a material amount of assets or securities, any
disposition of a material amount of assets or securities or any release or
relinquishment of any material contract rights not in the ordinary course of
business;
20
<PAGE> 25
(g) shall not propose or adopt any amendments of their
respective organizational documents;
(h) shall not issue any shares of their capital stock,
LP Units or GP Units (except upon exercise of options issued and outstanding on
the date hereof pursuant to employee benefit plans, programs or arrangements in
existence on the date hereof), effect any stock split, issue any debt securities
or borrow any money (other than bank borrowings in the ordinary course of
business consistent with past practice), or otherwise change its capitalization
as it existed on October 31, 1997, in the case of Getty, and September 30,
1997, in the case of PTI;
(i) shall not grant, confer or award any options,
warrants, calls, subscriptions, convertible securities or other securities, or
enter into any agreements, commitments or obligations which would require Getty
or PTI to acquire any shares of its capital stock, LP Units or GP Units, except
pursuant to employee benefit plans, programs or arrangements in existence on the
date hereof, in the ordinary course of business and consistent with past
practice;
(j) shall not purchase or redeem any shares of their
own capital stock, LP Units or GP Units; and
(k) shall not agree in writing, or otherwise, to take
any of the foregoing actions or any action which would make any representation
or warranty in Articles 3 or 4 hereof untrue or incorrect.
5.2 Meeting of Stockholders and Unitholders. Each of
Getty and PTI will take all action necessary in accordance with applicable law
and its organizational documents to convene a meeting of its stockholders or
unitholders as promptly as practicable to consider and vote upon the adoption of
this Agreement and the transactions contemplated hereby, as required by
applicable law. The Board of Directors of Getty will recommend that its
stockholders vote in favor of such adoption, CLS will recommend that the
unitholders of PTI vote in favor of such adoption and Getty and PTI will each
take all lawful action to solicit such approval, including, without limitation,
timely mailing the Joint Proxy Statement/Prospectus; provided, however, that
nothing contained in this Section 5.2 shall prohibit either Getty or PTI from
taking and disclosing to its stockholders or unitholders a position contemplated
by Rule 14e-2(a) promulgated under the Exchange Act or from making any
disclosure to, or having any communication with, their respective stockholders
or unitholders if, in the good faith judgment of the Board of Directors of Getty
or CLS, as applicable, after consultation with outside counsel, failure so to
disclose or communicate would be inconsistent with its fiduciary duties under
applicable law. The respective meetings of the stockholders and unitholders of
Getty and PTI shall be held as soon as practicable and in any event (to the
extent permissible under applicable law) within forty-five (45) days after the
date upon which the Joint Proxy Statement/Prospectus shall have been approved
for release to the stockholders and unitholders of Getty and PTI by the SEC;
provided, however, that notwithstanding anything to the contrary contained in
this Agreement, Getty and PTI may adjourn or postpone their respective meetings
of stockholders and unitholders to the extent necessary, in the opinion of their
respective counsel, to supplement or amend the Joint
21
<PAGE> 26
Proxy Statement/Prospectus in advance of a vote on this Agreement and the
Mergers. Getty and PTI shall coordinate and cooperate with respect to the
timing of such meetings and shall endeavor to hold such meetings on the same
day.
5.3 Further Assurance and Cooperation. Subject to the
terms and conditions herein provided, Getty and PTI agree to use all reasonable
efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things necessary, proper or advisable to consummate and make
effective as promptly as practicable the transactions contemplated by this
Agreement and to cooperate with each other in connection therewith, (a) to
obtain all necessary waivers, consents and approvals from other parties to
material loan agreements, leases and other contracts (provided that neither
Getty nor PTI shall agree to any substantial modification to any such
agreement, lease or contract or to any payment of funds in order to obtain such
waiver, consent or approval without the prior written consent of the other),
(b) to defend any lawsuits or other legal proceedings challenging this
Agreement or the consummation of the transactions contemplated hereby, (c) to
lift or rescind any injunction or restraining order or other order adversely
affecting the ability of the parties to consummate the transactions
contemplated thereby, (d) to effect all necessary registrations and filings
(including any registrations and filings which may be required to be made by
Holdings pursuant to any federal or state securities laws), and (e) to fulfill
all conditions to this Agreement.
5.4 Certain Filings and Consents. Each of Getty and PTI
shall (a) cooperate with the other in determining whether any other filings are
required to be made or consents, approvals, permits or authorizations are
required to be obtained under any federal, state, local or foreign law or
regulation or whether any consents, approvals or waivers are required to be
obtained from other parties to loan agreements, leases or other contracts in
connection with the consummation of the Mergers and the other transactions
contemplated by this Agreement, and (b) actively assist each other in obtaining
any consents, permits, authorizations, approvals or waivers which are required.
Each of Getty and PTI shall promptly inform the other of any material
communication between such party and any government or governmental authority
regarding the Mergers or the other transactions contemplated by this Agreement.
If Getty or PTI receives a request for additional information or documentary
material from any such government or governmental authority, then such party
shall endeavor in good faith to make, or cause to be made, as soon as
reasonably practicable and after consultation with the other party, an
appropriate response to such request. Getty and PTI shall cooperate in
connection with reaching any understandings, undertaking or agreements (oral or
written) involving any government or any governmental authority in connection
with the transactions contemplated hereby.
5.5 Publicity. The initial press release relating to
this Agreement will be a joint press release and thereafter Getty and PTI will,
subject to their respective legal obligations (including requirements of stock
exchanges and other similar regulatory bodies), consult with each other, and
use reasonable efforts to agree upon the text of any press release, before
issuing any such press release or otherwise making public statements with
respect to the transactions contemplated hereby and in making any filings with
any governmental or regulatory authorities or with any national securities
exchange with respect thereto.
22
<PAGE> 27
5.6 Joint Proxy Statement/Prospectus and the Form S-4.
Getty and PTI will cooperate and promptly prepare and file with the SEC as soon
as practicable a joint proxy statement/prospectus and necessary forms of proxy
in connection with the vote of Getty's stockholders and of PTI's unitholders
with respect to the Mergers and the offer to such stockholders and unitholders
of the securities to be issued pursuant to the Mergers (the "Joint Proxy
Statement/Prospectus") and will cause Holdings to prepare and file with the SEC
the registration statement on Form S-4 (the "Form S-4") under the Securities
Act, in which the Joint Proxy Statement/Prospectus shall be included as a
prospectus. Getty and PTI will cause the Form S-4 to comply in all material
respects with the applicable provisions of the Securities Act and the Exchange
Act. Each of Getty and PTI will use its best efforts to have the Form S-4
declared effective by the SEC as promptly as practicable and to keep the Form
S-4 effective as long as is necessary to consummate the Mergers. Getty and PTI
will cause Holdings to take any action required to be taken to obtain, prior to
the effective date of the Form S-4, all necessary state securities law or "Blue
Sky" permits or approvals required to carry out the transactions contemplated
by this Agreement and all expenses incident thereto will be shared equally by
Getty and PTI. No amendment or supplement to the Form S-4 or the Joint Proxy
Statement/Prospectus will be made by Getty or PTI without the approval of the
other party, such approval not to be unreasonably withheld or delayed. Each of
PTI and Getty shall use reasonable efforts to cause the Joint Proxy
Statement/Prospectus to be mailed to its respective stockholders and
unitholders as soon as practicable after the date hereof.
5.7 Listing Application. Each of Getty and PTI will
cause Holdings to promptly prepare and submit to the NYSE a listing application
covering the shares of Holdings Common Stock and Holdings Preferred Stock
issuable in the Mergers, and will use its best efforts to obtain, prior to the
Effective Time, approval for the listing of such Holdings Common Stock and
Holdings Preferred Stock, subject to official notice of issuance.
5.8 Further Action. Each of Getty and PTI will, subject
to the other terms and conditions set forth herein and to the fulfillment at or
before the Effective Time of each of the conditions of performance set forth
herein or the waiver thereof, perform such further acts and execute such
documents as may be reasonably required to effect the Mergers.
5.9 Affiliate Letters. At least 15 days prior to the
Closing Date, each of Getty and PTI will deliver to the other party a list of
names and addresses of those Persons who were, in its respective reasonable
judgment, at the record date for its respective stockholders' or unitholders'
meeting to approve the Mergers, "affiliates" within the meaning of Rule 145 of
the rules and regulations promulgated under the Securities Act. Each of Getty
and PTI will use all reasonable efforts to deliver or cause to be delivered to
the other, prior to the Closing Date, from each of the "affiliates" identified
in the foregoing list, an Affiliate Letter in the forms attached hereto as
Exhibit H. Holdings will be entitled, to the extent it is so required by
applicable law (as advised by outside counsel experienced in such matters) to
place legends as specified in such Affiliate Letters on the certificates
evidencing any Holdings Common Stock and Holdings Preferred Stock to be
received by such "affiliates" pursuant to the terms of this Agreement, and
23
<PAGE> 28
to issue appropriate stop-transfer instructions to the transfer agent for
Holdings Common Stock and Holdings Preferred Stock, consistent with the terms
of such Affiliate Letters.
5.10 Expenses. Whether or not the Mergers are
consummated, all costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby will be paid by the party incurring
such expenses except as expressly provided herein, and except that (a) the
filing fee in connection with the filing of the Form S-4 or Joint Proxy
Statement/Prospectus with the SEC, and (b) the expenses incurred in connection
with the preparation, printing and mailing the Form S-4 and the Joint Proxy
Statement/Prospectus, will be shared equally by Getty and PTI. The provisions
of this Section 5.10 will survive the consummation of the Mergers.
5.11 Indemnification. (a) From and after the Effective
Time, Holdings shall indemnify, defend and hold harmless the present and former
directors, officers and employees of Getty, PTI, CLS and their respective
Subsidiaries (each, an "Indemnified Party") against all costs or expenses
(including reasonable attorneys' fees), judgments, fines, losses, claims,
damages or liabilities (collectively, "Costs") incurred in connection with any
claim, action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative, arising out of actions or omissions as
directors or officers of Getty, PTI, CLS and their respective Subsidiaries
occurring at or prior to the Effective Time, including, without limitation, the
transactions contemplated by this Agreement, to the fullest extent that such
persons are indemnified under the laws of the States of Delaware or New York
and the organizational documents, as in effect on the date hereof, of Getty,
PTI, CLS and their respective Subsidiaries or any existing indemnification
agreement with any of Getty, PTI or CLS (and during such period Holdings shall
also advance expenses (including expenses constituting Costs described in
Section 5.11(e)) as incurred to the fullest extent permitted under applicable
law, provided that the Person to whom expenses are advanced provides a written
affirmation of his or her good faith that the standard of conduct necessary for
indemnification by the corporation has been met and an undertaking to repay
such advances if it is ultimately determined that such Person is not entitled
to indemnification with no bond or security to be required); provided that any
determination required to be made with respect to whether an officer's or
director's conduct complies with the standards set forth under applicable law
and any such organizational documents shall be made by independent counsel
(which shall not be counsel that provides material services to Holdings or its
Subsidiaries) selected by Holdings and reasonably acceptable to such officer or
director; and provided, further, that in the absence of applicable judicial
precedent to the contrary, such counsel, in making such determination, shall
presume such officer's or director's conduct complied with such standard and
Holdings shall have the burden to demonstrate that such officer's or director's
conduct failed to comply with such standard.
(b) For a period of not less than six (6) years after the
Effective Time, Holdings will maintain officers' and directors' liability
insurance covering those of the Indemnified Parties who are currently covered,
in their capacities as current or former officers and directors of Getty, by
Getty's existing officers' and directors' liability insurance policy on terms
substantially no less advantageous to the Indemnified Parties than such
existing insurance.
24
<PAGE> 29
(c) Any Indemnified Party wishing to claim
indemnification under Section 5.11(a), upon learning of any claim, action,
suit, proceeding or investigation described above, shall promptly notify
Holdings thereof; provided that the failure so to notify shall not affect the
obligations of Holdings under Section 5.11(a) unless and to the extent such
failure materially increases Holdings' liability under such subsection (a).
(d) If Holdings or any of its successors or assigns shall
consolidate with or merge with any other entity and shall not be the continuing
or surviving entity of such consolidation or merger or shall transfer all or
substantially all of its assets to any Person, then and in each case, proper
provision shall be made so that the successors and assigns of Holdings or any
of its Subsidiaries shall assume the obligations set forth in this Section
5.11.
(e) Holdings shall pay all reasonable Costs, including
attorneys' fees, that may be incurred by any Indemnified Party in enforcing the
indemnity and other obligations provided for in this Section 5.11. The rights
of each Indemnified Party hereunder shall be in addition to any other rights
such Indemnified Party may have under applicable law.
(f) Getty and PTI will cause Holdings to keep in effect
provisions in New Getty's and Holdings' organizational documents providing for
exculpation of director and officer liability and its indemnification of the
Indemnified Parties to the fullest extent permitted under the DGCL or the
Maryland General Corporation Law (the "MGCL"), as applicable, which provisions
will not be amended except as required by applicable law or except to make
changes permitted by law that would enlarge the Indemnified Parties' right of
indemnification.
(g) The provisions of this Section 5.11 will survive the
consummation of the Mergers and expressly are intended to benefit each
Indemnified Party.
5.12 Consents. Getty and PTI will use all reasonable
efforts to obtain each of the consents identified in Section 3.6 and 4.6,
respectively, of the Disclosure Schedule.
5.13 Letter of Getty's Accountants. Getty shall use
reasonable efforts to cause to be delivered to PTI and Holdings a letter of
Coopers & Lybrand L.L.P., Getty's independent auditors, dated a date within two
business days before the date on which the Form S-4 shall become effective and
addressed to Holdings, in form reasonably satisfactory to PTI and customary in
scope and substance for letters delivered by independent public accountants in
connection with registration statements similar to the Form S-4.
5.14 Letter of PTI's Accountants. PTI shall use
reasonable efforts to cause to be delivered to Getty and Holdings a letter of
Coopers & Lybrand L.L.P., PTI's independent auditors, dated a date within two
business days before the date on which the Form S-4 shall become effective and
addressed to Holdings, in form reasonably satisfactory to Getty and customary
in scope and substance for letters delivered by independent public accountants
in connection with registration statements similar to the Form S-4.
25
<PAGE> 30
5.15 Registration Statement on Form S-8. No later than
the Effective Time, Getty and PTI shall cause Holdings to prepare and file with
the SEC a registration statement on Form S-8 (or another appropriate form)
registering a number of shares of Holdings Common Stock at least equal to the
number of shares of Holdings Common Stock subject to options to be received by
the holders of Getty Options pursuant to Section 2.1(c). Such registration
statement shall be kept effective (and the current status of the prospectus or
prospectuses required thereby shall be maintained) at least for so long as any
options with respect to Holdings Common Stock received by the holders of Getty
Options pursuant to Section 2.1(c) remain outstanding.
5.16 Tax Matters Certificates. In connection with the
opinion to be rendered by counsel to Getty pursuant to Section 6.2(e), at the
Closing, Getty, PTI and Holdings shall deliver, and each of Getty and PTI will
use its best efforts to cause each of its stockholders or unitholders owning
five percent (5%) or more of any class of the voting stock or LP Units of Getty
or PTI, to deliver Tax Matters Certificates to such counsel, which certificates
shall be in substantially the forms set forth on Exhibit I. Such counsel
shall, in rendering such opinion, be entitled to rely on representations
contained in such Tax Matters Certificates.
5.17. Assumption of Obligations by Holdings, Getty Sub and
PTI LLC. As soon as practicable after the formation of Holdings, Getty and PTI
shall cause Holdings (i) to sign and become a party to this Agreement and to
assume the obligations applicable to it hereunder and (ii) to cause Getty Sub
and PTI LLC to sign and become parties to this Agreement and to assume their
respective obligations hereunder and under the agreements of merger contained
herein. Upon their execution of this Agreement, Holdings, Getty Sub and PTI
LLC will be bound by the provisions hereof and Getty and PTI hereby agree that
upon such execution such entities shall be parties hereto.
6. CONDITIONS
6.1 Conditions to Each of Getty's and PTI's Obligation to
Effect the Mergers. The respective obligations of Getty and PTI to effect the
Mergers will be subject to the fulfillment or waiver by both parties at or
prior to the Closing Date of the following conditions:
(a) The Getty Merger and this Agreement shall have been
validly approved and adopted by (i) the affirmative vote of the holders of at
least that number of outstanding shares of Getty Common Stock required to
approve the Getty Merger under the DGCL and Getty's certificate of incorporation
and (ii) the affirmative vote of the holders of a majority of the Getty Common
Stock not held or directly or indirectly controlled by Messrs. Leo Liebowitz,
Milton Cooper and Milton Safenowitz and their spouses and affiliated trusts
(collectively, the "Principal Holders") voting on the Getty Merger and this
Agreement at the stockholders' meeting referred to in Section 5.2 (the "Getty
Stockholder Approvals");
(b) The PTI Merger and this Agreement shall have been
validly approved and adopted by (i) the affirmative vote of the holders of at
least that number of LP Units required to approve the PTI Merger under the NLPA
and the Partnership Agreement and (ii) the affirmative
26
<PAGE> 31
vote of the holders of a majority of the LP Units not held or directly or
indirectly controlled by the Principal Holders voting on the PTI Merger and this
Agreement at the unitholders' meeting referred to in Section 5.2 (the "PTI
Unitholder Approvals");
(c) Neither Getty nor PTI shall be subject to any order,
decree, ruling or injunction of a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission, and no law,
statute, rule or regulation shall have been promulgated or enacted by a
governmental or regulatory authority, which prohibits the consummation of the
transactions contemplated by this Agreement or would otherwise impair the
ability of Holdings to operate the business of Getty and PTI on a consolidated
basis following the Closing;
(d) The Form S-4 shall have become effective and shall be
effective at the Effective Time, and no stop order suspending effectiveness of
the Form S-4 shall have been issued which shall be in effect at the Effective
Time, no action, suit, proceeding or investigation by the SEC to suspend the
effectiveness thereof shall have been initiated and be continuing or, to the
knowledge of Getty or PTI, be threatened in writing, and all necessary
approvals under state securities laws relating to the issuance or trading of
Holdings Common Stock and Holdings Preferred Stock to be issued to Getty and
PTI stockholders and unitholders in connection with the Mergers shall have been
received;
(e) All consents, licenses, permits, authorizations,
orders and approvals of (or filings or registrations with) any governmental or
regulatory authorities, and all consents, authorizations and approvals of any
other entity (including, without limitation, any bank or financial institution)
required in connection with the execution, delivery and performance of this
Agreement shall have been obtained or made, except for filings in connection
with the Mergers and any other documents required to be filed after the
Effective Time and except where the failure to have obtained or made any such
consent, license, permit, authorization, order, approval, filing or
registration would not have a Material Adverse Effect on Holdings and its
Subsidiaries, taken as a whole, following the Effective Time;
(f) Holdings Common Stock and Holdings Preferred Stock to
be issued to Getty and PTI stockholders and unitholders in connection with the
Mergers shall have been approved for listing on the NYSE, subject only to
official notice of issuance;
(g) After the Effective Time and except as set forth in
this Agreement, no Person will have any right under any stock option plan (or
any option granted thereunder) or other plan, program or arrangement to acquire
any securities of Getty, PTI or any of their respective Subsidiaries;
(h) Holders of LP Units representing no more than 10% of
the issued and outstanding LP Units shall have exercised, and not withdrawn,
their rights to dissent from the PTI Merger; and
(i) Getty and PTI shall have received a legal opinion
from Latham & Watkins, in form and substance reasonably satisfactory to Getty
and PTI, substantially to the
27
<PAGE> 32
effect that, on the basis of the facts, representations and assumptions set
forth in such opinion, the PTI Merger and the transfer of the general partner
interest in PT Realty to Holdings will be treated as an exchange under Section
351(a) of the Code and, except for Dissenting Limited Partners, no gain will be
recognized to holders of LP Units or GP Units, and the Getty Merger will be
treated as a reorganization under Section 368(a) of the Code and no gain will
be recognized to Getty stockholders.
6.2 Conditions to Obligation of Getty to Effect the
Mergers. The obligation of Getty to effect the Mergers will be subject to the
fulfillment or waiver by Getty at or prior to the Closing Date of the following
additional conditions:
(a) PTI shall have performed and complied in all material
respects with all material obligations and agreements required to be performed
and complied with by it under this Agreement at or prior to the Closing Date;
(b) The representations and warranties of PTI contained
in this Agreement that are qualified as to materiality shall be true and
correct, and such representations and warranties of PTI that are not so
qualified shall be true and correct in all material respects, in each case both
as of the date of this Agreement and on the Closing Date as though made on and
as of the Closing Date, except to the extent such representations and
warranties are expressly made as of an earlier date, in which case, such
representations and warranties shall be true and correct as of such date;
(c) Getty shall have received a certificate from the
President or a Vice President of CLS, dated as of the Closing Date, to the
effect that the conditions set forth in paragraphs (a) and (b) above have been
satisfied;
(d) From the date of this Agreement through the Effective
Time, a Material Adverse Effect with respect to PTI and its Subsidiaries, taken
as a whole, shall not have occurred; and
(e) The opinion of Furman Selz LLC received by Getty in
accordance with the provisions of Section 3.14 hereof shall not have been
withdrawn or modified in any adverse manner.
6.3 Conditions to Obligation of PTI to Effect the
Mergers. The obligation of PTI to effect the Mergers will be subject to the
fulfillment or waiver by PTI at or prior to the Closing Date of the following
additional conditions:
(a) Getty shall have performed and complied in all
material respects with all material obligations and agreements required to be
performed and complied with by it under this Agreement at or prior to the
Closing Date;
(b) The representations and warranties of Getty contained
in this Agreement that are qualified as to materiality shall be true and
correct, and such representations and
28
<PAGE> 33
warranties of Getty that are not so qualified shall be true and correct in all
material respects, in each case both as of the date of this Agreement and on
the Closing Date as though made on and as of the Closing Date, except to the
extent such representations and warranties are expressly made as of an earlier
date, in which case, such representations and warranties shall be true and
correct as of such date;
(c) PTI shall have received from Getty a certificate from
the President or a Vice President of Getty, dated as of the Closing Date, to
the effect that the conditions set forth in paragraphs (a) and (b) above have
been satisfied;
(d) From the date of this Agreement through the Effective
Time, a Material Adverse Effect on Getty and its Subsidiaries, taken as a
whole, shall not have occurred; and
(e) The opinion of CIBC Oppenheimer Corp. received by PTI
in accordance with the provisions of Section 4.14 hereof shall not have been
withdrawn or modified in any adverse manner.
7. TERMINATION, WAIVER AND AMENDMENT
7.1 Termination or Abandonment. Notwithstanding
anything contained in this Agreement to the contrary, this Agreement may be
terminated and abandoned at any time prior to the Effective Time, whether
before or after the Getty Stockholder Approvals and the PTI Unitholder
Approvals:
(a) by the mutual written consent of Getty and PTI;
(b) by Getty or PTI if the Effective Time shall not have
occurred on or before six (6) months from the date of this Agreement; provided,
however, that the right to terminate this Agreement under this Section 7.1(b)
shall not be available to any party whose breach of this Agreement has been the
cause of, or resulted in, the failure of the Effective Time to occur on or
before such date; or
(c) by Getty or PTI if any court of competent
jurisdiction in the United States or other United States governmental body
shall have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Mergers and such order,
decree, ruling or other action shall have become final and nonappealable.
In the event of termination of this Agreement pursuant to this
Section 7.1, this Agreement shall terminate, and there shall be no other
liability on the part of Getty or PTI to the other except liability arising out
of a breach of this Agreement.
7.2 Amendment or Supplement. At any time before or
after the Getty Stockholder Approvals and the PTI Unitholder Approvals and
prior to the Effective Time, this Agreement may be amended or supplemented in
writing by Getty and PTI with respect to any of the terms contained in this
Agreement, except that following the Getty Stockholder Approvals
29
<PAGE> 34
and the PTI Unitholder Approvals there shall be no amendment or change to the
provisions hereof with respect to the Getty Exchange Ratio or PTI Exchange
Ratio as provided herein, without further approval by the respective
stockholders and unitholders of Getty and PTI.
7.3 Extension of Time, Waiver, Etc.. At any time prior
to the Effective Time, Getty and PTI may:
(a) extend the time for the performance of any of the
obligations or acts of the other party;
(b) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document delivered
pursuant hereto; and
(c) waive compliance with any of the agreements or
conditions of the other party contained herein;
provided, however, that no failure or delay by Getty or PTI in
exercising any right hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right hereunder. Any agreement on the
part of a party hereto to any such extension or waiver shall be valid only if
set forth in an instrument in writing signed on behalf of such party.
8. GENERAL PROVISIONS
8.1 Non-survival of Representations and Warranties. All
representations and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement will be deemed to the extent expressly provided
herein to be conditions to the Mergers and will not survive the Mergers. This
Section shall not limit any covenant or agreement of the parties which by its
terms contemplates performance after the Effective Time.
8.2 Notices. Any notice required to be given hereunder
will be sufficient if in writing, and sent by facsimile transmission and by
courier service (with proof of service), hand delivery or certified or
registered mail (return receipt requested and first- class postage prepaid),
addressed as follows:
If to Getty: If to PTI or CLS:
Getty Realty Corp. Power Test Investors Limited Partnership
125 Jericho Turnpike c/o CLS General Partnership Corp.
Jericho, New York 11753 125 Jericho Turnpike
Attention: Assistant General Counsel Jericho, New York 11753
Fax No.: (516) 338-6062 Attention: Assistant Secretary
Fax No.: (516) 338-1520
30
<PAGE> 35
With copies to counsel for Getty: With copies to counsel
for PTI and CLS:
Latham & Watkins Wolf, Block, Schorr and Solis-Cohen, LLP
Sears Tower, Suite 5800 Twelfth Floor, Packard Building
233 South Wacker S.E. Corner 15th and Chestnut Streets
Chicago, Illinois 60606 Philadelphia, Pennsylvania 19102
Attention: Marc D. Bassewitz Attention: Alvin H. Dorsky
Fax No.: (312) 993-9767 Fax No.: (215) 977-2334
or to such other address as any party will specify by written notice so given,
and such notice will be deemed to have been delivered as of the date so
telecommunicated, personally delivered or mailed.
8.3 Assignment; Binding Effect. Neither this Agreement
nor any of the rights, interests or obligations hereunder will be assigned by
any of the parties hereto (whether by operation of law or otherwise) without
the prior written consent of the other parties. Subject to the preceding
sentence, this Agreement will be binding upon and will inure to the benefit of
the parties hereto and their respective successors and assigns.
Notwithstanding anything contained in this Agreement to the contrary, except
for the provisions of Section 5.11, nothing in this Agreement, expressed or
implied, is intended to confer on any Person other than the parties hereto or
their respective heirs, successors, executors, administrators and assigns any
rights, remedies, obligations or liabilities under or by reason of this
Agreement.
8.4 Entire Agreement. This Agreement, the Exhibits, the
Disclosure Schedule and any documents delivered by the parties in connection
herewith which will survive the execution and delivery of this Agreement,
constitute the entire agreement among the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings among the
parties with respect thereto. No addition to or modification of any provision
of this Agreement will be binding upon any party hereto unless made in writing
and signed by all parties hereto.
8.5 Governing Law. This Agreement will be governed by
and construed in accordance with the laws of the State of New York without
regard to its rules of conflict of laws; provided, however, that all matters
covered by the DGCL will be governed by and construed in accordance with the
laws of the State of Delaware without regard to its rules of conflict of laws
and all matters covered by the MGCL will be governed by and construed in
accordance with the laws of the State of Maryland without regard to its rules
of conflict of laws.
8.6 Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered will be an original, but all such counterparts will together
constitute one and the same instrument. Each counterpart may consist of a
number of copies hereof each signed by less than all, but together signed by
all of the parties hereto.
31
<PAGE> 36
8.7 Headings. Headings of the Articles and Sections of
this Agreement are for the convenience of the parties only, and will be given
no substantive or interpretive effect whatsoever.
8.8 Interpretation. In this Agreement, unless the
context otherwise requires, words describing the singular number will include
the plural and vice versa, and words denoting any gender will include all
genders and words denoting natural Persons will include corporations and
partnerships and vice versa.
8.9 Incorporation of Schedules. The Disclosure Schedule
attached hereto and referred to herein is hereby incorporated herein and made a
part hereof for all purposes as if fully set forth herein.
8.10 Severability. Any term or provision of this
Agreement which is invalid or unenforceable in any jurisdiction will, as to
that jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision will be interpreted to be only so broad as is enforceable.
8.11 Enforcement of Agreement. The parties hereto agree
that irreparable damage would occur in the event that any of the provisions of
this Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that the parties will be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions hereof in any New York court,
this being in addition to any other remedy to which they are entitled at law or
in equity.
9. DEFINITIONS
9.1 Defined Terms. As used herein, the terms below
shall have the following meanings:
"Action" shall mean any action, order, writ, injunction,
judgment or decree outstanding or claim, suit, litigation, proceeding,
arbitration or investigation by or before any court, governmental or other
regulatory or administrative agency or commission or any other Person.
"Affiliate" shall mean, with respect to any Person, any other
Person that directly, or through one or more intermediaries, controls or is
controlled by or is under common control with such Person.
"Assets" shall mean, with respect to any Person, all land,
buildings, improvements, leasehold improvements, Fixtures and Equipment and
other assets, real or
32
<PAGE> 37
personal, tangible or intangible, owned, leased or licensed by such Person or
any of its Subsidiaries.
"Disclosure Schedule" means the schedules dated as of the date
hereof and delivered by or on behalf of each party hereto to the other party
hereto in connection with this Agreement and which set forth exceptions to the
representations and warranties contained in herein and certain other
information called for by other provisions of this Agreement.
"Encumbrances" shall mean any claim, lien, pledge, option,
charge, easement, security interest, deed of trust, mortgage, right-of-way,
covenant, condition, restriction, encumbrance or other rights of third parties.
"Environmental Laws" shall mean any federal, state or local
law, statute, ordinance, order, decree, rule or regulation relating to
releases, discharges, emissions or disposals to air, water, land or groundwater
of Hazardous Materials; to the withdrawal or use of groundwater; to the use,
handling or disposal of polychlorinated biphenyls, asbestos or urea
formaldehyde or any other Hazardous Material; to the treatment, storage,
disposal or management of Hazardous Materials; to exposure to toxic, hazardous
or other controlled, prohibited or regulated substances; and to the
transportation, release or any other use of Hazardous Materials, including the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
9601, et seq. ("CERCLA"), the Resource Conservation and Recovery Act, 42 U.S.C.
6901, et seq. ("RCRA"), the Toxic Substances Control Act, 15 U.S.C. 2601, et
seq. ("TSCA"), the Occupational, Safety and Health Act, 29 U.S.C. 651, et seq.,
the Clean Air Act, 42 U.S.C. 7401, et seq., the Federal Water Pollution Control
Act, 33 U.S.C. 1251, et seq., the Safe Drinking Water Act, 42 U.S.C. 300f, et
seq., the Hazardous Materials Transportation Act, 49 U.S.C. 1802 et seq.
("HMTA") and the Emergency Planning and Community Right to Know Act, 42 U.S.C.
11001 et seq. ("EPCRA"), and other comparable state laws and all rules,
regulations and guidance documents promulgated pursuant thereto or published
thereunder.
"Equity Interests" means capital stock, partnership interests
or warrants, options or other rights to acquire capital stock or partnership
interests (including any debt security which is convertible into, or
exchangeable for, capital stock or partnership interests).
"Facilities" shall mean, with respect to any Person, all of
the stores, offices, plants, warehouses, terminals, service stations and
similar structures owned or leased by such Person.
"Fixtures and Equipment" shall mean, with respect to any
Person, all of the furniture, fixtures, furnishings, machinery and equipment
owned, leased or licensed by such Person and located in, at or upon the
Facilities of such Person.
"GAAP" shall mean generally accepted accounting principles in
the United States of America, as in effect from time to time, consistently
applied.
33
<PAGE> 38
"Hazardous Materials" shall mean each and every element,
compound, chemical mixture, contaminant, pollutant, material, waste or other
substance which is defined, determined or identified as hazardous or toxic
under Environmental Laws or the release of which is regulated under
Environmental Laws. Without limiting the generality of the foregoing, the term
includes: "hazardous substances" as defined in CERCLA; "extremely hazardous
substances" as defined in EPCRA; "hazardous waste" as defined in RCRA;
"hazardous materials" as defined in HMTA; "chemical substance or mixture" as
defined in TSCA; crude oil, petroleum products or any fraction thereof;
radioactive materials including source, byproduct or special nuclear materials;
asbestos or asbestos-containing materials; and radon.
"Leases" shall mean, with respect to any Person, all leases
(including subleases, licenses, any occupancy agreement and any other
agreement) of real or personal property, in each case to which such Person or
any of its Subsidiaries is a party, whether as lessor, lessee, guarantor or
otherwise, or by which any of them or their respective Properties or assets are
bound, or which otherwise relate to the operation of their respective
businesses.
"Material Adverse Effect" shall mean, with respect to any of
Holdings (following the Mergers), Getty or PTI, as the context requires, a
material adverse change in or effect on the business, results of operations,
assets, liabilities or conditions (financial or otherwise) of such Person and
its Subsidiaries taken as a whole or any change which impairs or materially
delays the ability of such Person to consummate the transactions contemplated
by this Agreement.
"Permitted Encumbrances" shall mean any Encumbrances resulting
from (i) all statutory or other liens for Taxes or assessments which are not
yet due or delinquent or the validity of which are being contested in good
faith by appropriate proceedings for which adequate reserves are being
maintained in accordance with GAAP; (ii) all cashiers', workers' and repairers'
liens, and other similar liens imposed by law, incurred in the ordinary course
of business; (iii) all laws and governmental rules, regulations, ordinances and
restrictions; (iv) all leases, subleases, licenses, concessions or service
contracts to which any Person or any of its Subsidiaries is a party; (v)
Encumbrances identified on title policies or preliminary title reports
delivered or made available for inspection to any Person prior to the date
hereof; and (vi) all other liens and mortgages (but solely to the extent such
liens or mortgages secure indebtedness described in the Disclosure Schedule),
covenants, imperfections in title, charges, easements, restrictions and other
Encumbrances which, in the case of any such Encumbrances pursuant to clause (i)
through (vi), do not materially detract from or materially interfere with the
value or present use of the asset subject thereto or affected thereby.
"Person" shall mean any individual, corporation, partnership,
limited liability company, joint venture, governmental agency or
instrumentality, or any other entity.
"Properties" shall mean, with respect to any Person, all of
the improved and unimproved real property owned or leased by such Person.
34
<PAGE> 39
"Subsidiary" shall mean, with respect to any Person, any
corporation or other organization, whether incorporated or unincorporated, of
which at least a majority of the Equity Interests having ordinary voting power
for the election of directors or other governing body of such organization is
owned or controlled by such Person directly or indirectly.
"Tax" or "Taxes" shall mean all federal, state, local, foreign
and other taxes, levies, imposts, assessments, impositions or other similar
government charges, including, without limitation, income, estimated income,
business, occupation, franchise, real property, payroll, Personal property,
sales, transfer, stamp, use, employment, commercial rent or withholding,
occupancy, premium, gross receipts, profits, windfall profits, deemed profits,
license, lease, severance, capital, production, corporation, ad valorem,
excise, duty or other taxes, including interest, penalties and additions (to
the extent applicable) thereto.
9.2 Other Defined Terms. The following terms shall have
the respective meanings given to such terms in the Sections set forth below:
<TABLE>
<S> <C>
TERM SECTION
Agreement Preamble
Blue Sky Laws Section 3.6(b)
Certificates Section 2.2(b)
Closing Section 1.5
Closing Date Section 1.5
CLS Preamble
CLS Consideration Section 2.1(b)(iii)
Code Preamble
Consideration Section 2.1(b)(iii)
Costs Section 5.11(a)
DGCL Preamble
Dissenting Limited Partners Section 2.4(c)
Effective Time Section 1.6
Exchange Act Section 3.6(b)
Exchange Agent Section 2.2(a)
Exchange Fund Section 2.2(a)
Form S-4 Section 5.6
Getty Preamble
Getty Common Shares Section 2.1(b)(i)
Getty Common Stock Section 2.1(b)(i)
Getty Common Treasury Shares Section 2.1(b)(i)
Getty Consideration Section 2.1(b)(iii)
Getty Exchange Ratio Section 2.1(b)(i)
Getty Merger Preamble
Getty Options Section 2.1(c)
Getty Preferred Stock Section 3.3
</TABLE>
35
<PAGE> 40
<TABLE>
<S> <C>
Getty SEC Reports Section 3.8(a)
Getty Stock Option Plans Section 2.1(c)
Getty Stockholder Approvals Section 6.1(a)
Getty Sub Section 1.3(a)
Getty Transaction Document Section 3.2
GP Unit Section 2.1(b)(ii)
Holdings Preamble
Holdings Common Stock Preamble
Holdings Preferred Stock Preamble
HSR Act Section 3.16
Indemnified Party Section 5.11(a)
Joint Proxy Statement/Prospectus Section 5.6
LP Unit Section 2.1(b)(ii)
Mergers Preamble
MGCL Section 5.11(f)
New Getty Section 1.7(a)
New PTI Section 1.7(b)
NLLCL Section 1.4(c)
NLPA Preamble
NYSE Section 2.3
Partnership Agreement Section 4.1
Principal Holders Section 6.1(a)
PTI Preamble
PTI Consideration Section 2.1(b)(iii)
PTI Exchange Ratio Section 2.1(b)(ii)
PTI LLC Section 1.4(a)
PTI Merger Preamble
PTI SEC Reports Section 4.8(a)
PTI Unitholder Approvals Section 6.1(b)
PTI Transaction Document Section 4.2
PT Realty Section 1.10(a)
Rules Section 3.16
SEC Section 3.8(a)
Securities Act Section 3.6(b)
Surviving Entities Section 1.7(b)
Termination Date Section 5.1
</TABLE>
36
<PAGE> 41
IN WITNESS WHEREOF, the parties have executed this Agreement
and caused the same to be duly delivered on their behalf on the day and year
first written above.
GETTY REALTY CORP.
By: /s/ John J. Fitteron
---------------------------------------------------
Name: John J. Fitteron
----------------------------------------
Title: Senior Vice President, Treasurer and
----------------------------------------
Chief Financial Officer
----------------------------------------
POWER TEST INVESTORS LIMITED PARTNERSHIP
By: CLS General Partnership Corp., General Partner
By: /s/ Leo Liebowitz
-------------------------------------------------
Name: Leo Liebowitz
-------------------------------------
Title: President
--------------------------------------
For purposes of Section 1.10 (b) only:
CLS GENERAL PARTNERSHIP CORP.
By: /s/ Leo Liebowitz
-------------------------------------------------
Name: Leo Liebowitz
-------------------------------------
Title: President
--------------------------------------
37
<PAGE> 1
EXHIBIT 99.2
GETTY NEWS
- --------------------------------------------------------------------------------
Getty Realty Corp. 125 Jericho Turnpike, Jericho, NY 11753 (516) 338-2600
- --------------------------------------------------------------------------------
RELEASE: IMMEDIATE
GETTY REALTY CORP. AND POWER TEST INVESTORS
LIMITED PARTNERSHIP ANNOUNCE
MERGER AGREEMENT
Jericho, NY, December 17, 1997 -- Getty Realty Corp. (NYSE-GTY) and Power Test
Investors Limited Partnership (POWNZ) announced today that they have signed a
definitive agreement to combine their assets and operations.
Under the agreement, Getty Realty Corp. and Power Test Investors LP will become
wholly-owned subsidiaries of a new holding company that will take the name
Getty Realty Corp. Existing Getty stockholders will receive one share of common
stock of the holding company for each Getty Realty Corp. common share, and Power
Test Investors LP unitholders will receive 0.44 share of a new Participating
Convertible Redeemable Preferred Stock of the holding company for each Power
Test Investors LP unit. This represents a per unit value for Power Test
Investors LP units of approximately $11.00.
As a result of the merger, the new holding company will own Getty Realty
Corp.'s real estate and home heating oil assets and operations and will acquire
the real estate portfolio consisting of approximately 295 properties currently
held by Power Test Investors LP.
Under the terms of the definitive agreement, which has been unanimously
approved by the Board of Directors of Getty Realty Corp. and by the general
partner of Power Test Investors LP, Getty Realty Corp. stockholders will
exchange their Getty Realty Corp. common shares for common stock of the holding
company, while Power Test Investors LP unitholders will receive shares of
Series A Participating Convertible Redeemable Preferred Stock, each share of
which will be convertible into 1.1312 shares of common stock of the holding
company. The preferred stock will pay stated cumulative dividends of $1.775
per share per annum, or, if greater, the per share dividends paid on the common
stock of the holding company.
Investment banking firms Furman Selz LLC and CIBC Oppenheimer Corp. have
expressed opinions to the Getty Realty Corp. Board of Directors and to the
Board of Directors of the general partner of Power Test Investors LP,
respectively, that the
<PAGE> 2
merger considerations are fair, from a financial point of view, to the
stockholders of Getty Realty Corp. and the limited partners of Power Test
Investors LP, respectively. The transaction has been structured to qualify as
a tax-free reorganization or exchange to Getty Realty Corp. stockholders and
Power Test Investors LP unitholders, although no IRS ruling will be sought.
The merger, which is expected to be completed in early 1998, is conditioned on
receiving the approval of the stockholders of Getty Realty Corp. and of the
limited partners of Power Test Investors LP at special meetings to be held
early next year upon SEC clearance of proxy materials.
Getty Realty Corp. owns and leases approximately 1,100 properties in twelve
Northeastern and Middle Atlantic states. Approximately 1,000 of these
properties, consisting of service stations, convenience stores and petroleum
marketing terminals, are leased to Getty Petroleum Marketing Inc. Getty Realty
Corp. is also a marketer of heating oil in Pennsylvania and Maryland.
Power Test Investors LP, which is a publicly-traded master limited partnership,
is the limited partner in Power Test Realty Company Limited Partnership, which
owns approximately 290 gasoline service station properties and five petroleum
terminals, and leases these properties to Getty Realty Corp.
Contact: John J. Fitteron
(516) 338-2600
