EXHIBIT 2.1(B)
FIRST AMENDMENT TO AGREEMENT
FOR PURCHASE AND SALE OF ASSETS
THIS FIRST AMENDMENT, dated ___________, 1999 ("Amendment"), to
AGREEMENT FOR PURCHASE AND SALE OF ASSETS among SUBURBAN LODGES OF
AMERICA, INC. ("Suburban"), GUESTHOUSE INTERNATIONAL FRANCHISE
SYSTEMS, INC., formerly known as GUESTHOUSE FRANCHISE SYSTEMS, INC.
("Purchaser") and GUESTHOUSE INTERNATIONAL, L.L.C. ("Company").
RECITALS
WHEREAS, Company, Suburban and Purchaser entered in an Agreement
for Purchase and Sale of Assets, dated April 16, 1999, regarding the
sale and purchase of certain assets by the Company to Purchaser
("Agreement"); and.
WHEREAS, the parties now desire to amend and modify the terms and
provisions of the Agreement, as provided herein.
NOW THEREFORE, for and in consideration of the premises, and the
mutual covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Appendix A, Article 1, of the Agreement, Representations
---------------
and Warranties of the Company, is hereby amended to add the
-----------------------------
following:
1.25 Since the filing of the Articles of Organization, there have
not been any material changes in the business of the
Company, nor any mergers, acquisitions, transfers or sales
of all or substantially all of the assets of the Company,
including, but not limited to, any proposed merger with
Austin Lomas Group, LLC.
1.26 The Company established and holds exclusive title to all
rights associated with the webpage and domain name
GuestHouse.net (collectively, "Webpage"), and has the full
power and authority to sell, transfer and assign the Webpage
to Suburban and Purchaser. The Company shall sell, transfer
and assign the Webpage, and all of the Company's rights
associated with the Webpage, including, but not limited to,
the source code thereto, to Purchaser upon Closing. In the
event that the Company is unable to fully complete the sale,
transfer and assignment of the Webpage by the date of
Closing, the Company shall after Closing assist and
cooperate in good faith with Purchaser in consummating such
sale, transfer and assignment.
2. Section 2.1.2 of the Agreement is hereby amended to add the
following to the last paragraph thereof:
The parties acknowledge that the real and personal property
leases pertaining to the Company's offices in Little Rock,
Arkansas are not, by their terms, assignable, and that these
agreements cannot be assigned absent the specific consent of
the applicable lessors. To the extent the Company does not
obtain such consents to assignment prior to Closing,
Purchaser shall reimburse the Company for all rents and
payments paid by the Company with respect to such leases
applicable to the period of time subsequent to Closing
during which Purchaser enjoys the benefits of such leases
3. A new Section 2.1.3, "Application of Payments From
Franchisees or Licensees", is hereby added to the Agreement as
follows:
Franchise or license fees (other than Initial Franchise
Fees, as defined in Section 5 of the Company's License
Agreements), royalties, operating fees or payments received
from franchisees or licensees by the Company or Purchaser
after the date of Closing shall be applied first towards
current obligations and liabilities of the franchisees and
licensees to Purchaser. All franchisee payments paid after
Closing shall be remitted to Purchaser if received by the
Company. Neither Purchaser nor Suburban shall have any
obligation to collect any delinquencies owed by a franchisee
or licensee to the Company for the period of time prior to
Closing. The Company shall not have any obligation to
collect any delinquencies owed by a franchisee or licensee
to Purchaser for the period of time subsequent to Closing.
If, (a) a franchisee or licensee has been delinquent in its
payment of such franchise or license fees, operating fees,
royalties or payments prior to Closing and such
delinquencies remain outstanding as of Closing; (b) the
Company advises Purchaser prior to Closing, in writing, of
the identity of such franchisees and the amounts of such
delinquencies; and (c) Purchaser receives any funds from
such delinquent franchisees or licensees in excess of their
current obligations to Purchaser, then Purchaser shall remit
such excess funds received from such delinquent franchisees
or licensees to the Company in an amount not to exceed the
lesser of the amount of such delinquency or the amount
specified in the aforesaid written notice of delinquency
from the Company to Purchaser.
4. A new Section 2.1.4, "Initial Franchise Fees", is hereby added to the
Agreements as follows:
The Company, Suburban and Purchaser agree that all Initial
Franchise Fees paid to and received by the Company prior to
the date of Closing shall be deemed earned and shall be
retained by the Company, and that all Initial Franchise Fees
paid after the date of Closing shall be deemed earned by
Purchaser and shall be remitted to Purchaser if paid to the
Company.
5. Attached hereto as Exhibit A are the following Schedules of the
Company pursuant to the Agreement:
Agreement:
Schedule 1.1 Permitted Liens
Schedule 1.2(g) Miscellaneous Excluded Assets
Schedule 2.3 Allocation of Purchase Price
Schedule 3.2(a) Company Closing Documents
Schedule 3.2(d) Required Consents
Schedule 3.3(a) Suburban and Purchaser Closing
Documents
Appendix A:
Schedule 1.9(a) Personal Property Not in Good Repair
Schedule 1.9(b) Performance of Lessors
Schedule 1.12 GuestHouse Trademark Status
Schedule 1.13(a) Assigned Contracts
Schedule 1.13(b) Franchise and License Agreements
Schedule 1.16(b) Employment and Labor Matters
Schedule 1.17 Employee Benefit Matters
Schedule 1.20 Related Party Agreements
Schedule 1.21(e) Dividends and Distributions
Schedule 1.21(j) Delayed Accounts Payable
Schedule 1.21(l) Change in Membership Interests
Schedule 1.22(a) UFOC Registration
Schedule 1.23 Master Franchise Development
Agreement
Said Schedules are incorporated herein and in the Agreement. The
Company hereby certifies that all such Schedules are true, correct
and complete as of the date hereof and as of the Closing.
6. This Amendment may be executed in any number of counterparts,
each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument. Signatures
transmitted by telecopier shall be binding.
7. Except as amended hereby, the Agreement is hereby ratified and
confirmed. No other modification is made or intended other than as
set forth above, and all other terms and conditions of the
Agreement as reinstated shall remain in full force and effect.
Except as specifically provided to the contrary herein, all defined
terms used in this Amendment are defined in the same manner as such
terms are defined in the Agreement.
IN WITNESS WHEREOF, the parties have executed or caused this
Amendment to be executed by their duly authorized representatives as
of the day and year first above written.
SUBURBAN: SUBURBAN LODGES OF AMERICA, INC.
By: /s/ David Krischer
Name: DAVID KRISCHER
Title: CEO
PURCHASER: GUESTHOUSE INTERNATIONAL FRANCHISE SYSTEMS,
INC.
By: /s/ David Krischer
Name: DAVID KRISCHER
Title: CEO
COMPANY: GUESTHOUSE INTERNATIONAL LLC
By: /s/ James H. Keel III
Name: JAMES H. KEEL III
Title: Chairman & Manager