EXHIBIT 2.9
FIRST AMENDMENT TO THE
ASSET PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO THE ASSET PURCHASE AGREEMENT (the "Amendment") is
made as of the 17th day of June, 2004, among TSL Acquisition Corp., a
Delaware corporation (the "Buyer"), AMCON Distributing Company, a Delaware
corporation ("AMCON"), and Trinity Springs, Ltd., an Idaho corporation
("Seller").
Recitals
A. Buyer, AMCON and Seller entered into that certain Asset Purchase
Agreement, dated April 24, 2004 (the "Purchase Agreement"), pursuant to which
Buyer agreed to purchase and Seller agreed to sell the Assets in accordance
with the terms and conditions set forth therein. Unless otherwise defined
herein, capitalized terms used herein shall have the meanings ascribed to
them in the Purchase Agreement.
B. Buyer, AMCON and Seller desire to amend the Purchase Agreement to: (i)
increase the royalty payable by Buyer to Seller to the greater of $.03 per
liter or 4% of Net Sales and (ii) provide for payment of certain
consideration through the delivery of a cashier's check rather than the wire
transfer of funds.
C. Buyer, AMCON and Seller desire to replace the form of promissory note
attached as Exhibit I to the Purchase Agreement with a new form of promissory
note attached to this Amendment as Exhibit I which will maintain a ten year
amortization schedule but require the remaining principal and unpaid interest
to be paid on the fifth anniversary of the date hereof.
D. Buyer and AMCON are willing to proceed with the Closing without Buyer
having obtained the Consents listed on Exhibit II attached hereto in reliance
upon the agreement by Seller contained in the Amendment to use its Best
Efforts to obtain such Consents as soon as reasonably practicable after the
date hereof.
E. Buyer, AMCON and Seller desire to memorialize the oral lease, which
includes an option to purchase the subject property, for the office space
described on Exhibit III attached hereto with a written lease that is
consistent therewith and that includes other customary terms and conditions.
Seller undertakes to use its Best Efforts to obtain such written lease as
soon as practicable after the date hereof.
F. Buyer, AMCON and Seller desire to replace disclosure schedules 2.2(h),
2.3(a)(iii), 2.8(a), 3.6, 3.14, 3.16(a), 3.21(a), 3.21(b), and 3.23(d) to the
Purchase Agreement with the new forms of such schedules attached to this
Amendment as Exhibit IV.
NOW, THEREFORE, for and in consideration of the premises referenced in
the Recitals set forth above, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. Recitals. The Recitals are hereby incorporated herein.
2. Amendments to Purchase Agreement.
a. Except as expressly set forth herein, the Purchase
Agreement remains unchanged and in full force and effect and may only be
amended by written agreement of the parties.
b. Section 2.4(a) of the Purchase Agreement is hereby
deleted in its entirety and replaced with the following:
(a) One Million Dollars ($1,000,000.00) to be paid at
Closing by delivery at the Closing of a cashier's check payable to the order
of Seller;
c. Section 2.7(b)(i) of the Purchase Agreement is hereby
deleted in its entirety and replaced with the following:
(i) the sum of One Million Dollars ($1,000,000.00) plus
eighty percent (80%) of Seller's estimate of the Inventory and Current Assets
Purchase Price (as determined in accordance with Section 2.8(b)), which
estimate will be delivered in writing to Buyer at least five (5) business
days before the Closing Date, by delivery at Closing of a cashier's check
payable to the order of Seller;
d. Section 2.8(e) of the Purchase Agreement is hereby
deleted in its entirety and replaced with the following:
(e) Within three (3) business days after the
calculation of the Inventory and Current Assets Purchase price becoming
binding and conclusive on the parties pursuant to this Section 2.8, Buyer
shall pay the remainder of the Inventory and Current Assets Purchase Price to
Seller by delivery of a cashier's check payable to the order of Seller.
e. The first sentence of Section 11.1(a) of the Purchase
Agreement is hereby deleted in its entirety and replaced with the following:
(a) As additional consideration for the sale, transfer,
assignment and conveyance to Buyer of the Source Asset and the other Assets,
after the Closing in perpetuity, Buyer shall pay Seller a royalty in an
amount equal to the greater of (i) $.03 per liter of water that is extracted
by Buyer or its affiliates or any Person acting through rights granted by
Buyer or its affiliates from the Source Asset or any other Water Rights,
existing now or in the future, on the Real Property or any Appurtenances
thereto ("Trinity Water Rights"), or any adjacent properties from which
Trinity Water Rights source water can be extracted for any commercial
purposes, including, without limitation, sales, marketing, promotional
purposes or any other commercial use or (ii) four percent (4%) of Net Sales
(as such term is defined in Section 11.2) (such royalty is referred to as the
"Water Royalty").
3. New Form of Ten Year Note. Buyer, AMCON and Seller agree to
replace the form of promissory note attached as Exhibit I to the Purchase
Agreement with a new form of promissory note attached to this Amendment as
Exhibit I which will maintain a ten year amortization schedule but require
the remaining principal and unpaid interest to be paid on the fifth
anniversary of the date hereof.
4. Best Efforts to Obtain Remaining Consents. Buyer and AMCON are
willing to proceed with the Closing without Buyer having obtained the
Consents listed on Exhibit II attached hereto in reliance upon the agreement
by Seller contained in the Amendment to use its Best Efforts to obtain such
Consents as soon as reasonably practicable after the date hereof.
5. Memorialization of Oral Lease. Seller agrees to use its Best
Efforts to obtain, as soon as practicable after the date hereof, a written
lease memorializing the oral lease described on Exhibit III attached hereto
(which includes an option to purchase the subject property) and that includes
certain additional customary terms and conditions.
6. Buyer, AMCON and Seller agree to replace disclosure schedules
2.2(h), 2.3(a)(iii), 2.8(a), 3.6, 3.14, 3.16(a), 3.21(a), 3.21(b), and
3.23(d) to the Purchase Agreement with the new forms of such schedules
attached to this Amendment as Exhibit IV.
7. General Provisions
a. Expenses. Except as otherwise provided in this Amendment,
each party to this Amendment will bear its respective fees and expenses
incurred in connection with the preparation, negotiation, execution and
performance of this Amendment.
b. Notices. All notices, Consents, waivers and other
communications required or permitted by this Amendment shall be in writing
and shall be deemed given to a party in the same manner as set forth in the
Purchase Agreement.
c. Jurisdiction; Service of Process. Any Proceeding arising
out of or relating to the Purchase Agreement or this Amendment or any other
matter contemplated hereby or thereby may be brought in the courts of the
State of Idaho, County of Blaine, or, if it has or can acquire jurisdiction,
in the United States District Court for the District of Idaho, and each of
the parties irrevocably submits to the jurisdiction of each such court in any
such Proceeding, waives any objection it may now or hereafter have to venue
or to convenience of forum, and agrees that all claims in respect of the
Proceeding may be heard and determined in any such court. The parties agree
that either or both of them may file a copy of this paragraph with any court
as written evidence of the knowing, voluntary and bargained agreement between
the parties irrevocably to waive any objections to venue or to convenience of
forum. Process in any Proceeding referred to in the first sentence of this
section may be served on any party anywhere in the world.
d. Enforcement of Amendment. Seller acknowledges and agrees
that Buyer would be irreparably damaged if any of the provisions of this
Amendment are not performed in accordance with their specific terms and that
any Breach of this Amendment by Seller could not be adequately compensated in
all cases by monetary damages alone. Accordingly, in addition to any other
right or remedy to which Buyer may be entitled, at law or in equity, it shall
be entitled to enforce any provision of this Amendment by a decree of
specific performance and to temporary, preliminary and permanent injunctive
relief to prevent Breaches or threatened Breaches of any of the provisions of
this Amendment, without posting any bond or other undertaking.
e. Waiver; Remedies Cumulative. The rights and remedies of
the parties to this Amendment are cumulative and not alternative. Neither
any failure nor any delay by any party in exercising any right, power or
privilege under this Amendment or any of the documents referred to in this
Amendment will operate as a waiver of such right, power or privilege, and no
single or partial exercise of any such right, power or privilege will
preclude any other or further exercise of such right, power or privilege or
the exercise of any other right, power or privilege. To the maximum extent
permitted by applicable law, (a) no claim or right arising out of this
Amendment or any of the documents referred to in this Amendment can be
discharged by one party, in whole or in part, by a waiver or renunciation of
the claim or right unless in writing signed by the other party; (b) no waiver
that may be given by a party will be applicable except in the specific
instance for which it is given; and (c) no notice to or demand on one party
will be deemed to be a waiver of any obligation of that party or of the right
of the party giving such notice or demand to take further action without
notice or demand as provided in this Amendment or the documents referred to
in this Amendment.
f. Entire Agreements and Modification. This Amendment,
together with the Purchase Agreement and the documents referenced herein and
therein, supersede all prior agreements, whether written or oral, between the
parties with respect to its subject matter (including any letter of intent
and any confidentiality agreement between Buyer and/or AMCON and Seller) and
constitute (along with the Appendices, Schedules, Exhibits and other
documents delivered pursuant to this Amendment or the Purchase Agreement) a
complete and exclusive statement of the terms of the agreement between the
parties with respect to its subject matter. This Amendment may not be
amended, supplemented, or otherwise modified except by a written agreement
executed by the party to be charged with the amendment.
g. Assignments, Successors and No Third-Party Rights. No
party may assign any of its rights or delegate any of its obligations under
this Amendment without the prior written consent of the other parties, except
that Buyer may assign any of its rights and delegate any of its obligations
under this Amendment to AMCON or any Subsidiary of AMCON; provided that such
assignment shall not relieve AMCON of its obligations contained in this
Amendment. Subject to the preceding sentence, this Amendment will apply to,
be binding in all respects upon and inure to the benefit of the successors
and permitted assigns of the parties. Nothing expressed or referred to in
this Amendment will be construed to give any Person, other than the parties
to this Amendment, any legal or equitable right, remedy or claim under or
with respect to this Amendment or any provision of this Amendment, except
such rights as shall inure to a successor or permitted assignee pursuant to
this Section 7(g).
h. Severability. If any provision of this Amendment is held
invalid or unenforceable by any court of competent jurisdiction, the other
provisions of this Amendment will remain in full force and effect. Any
provision of this Amendment held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held invalid or
unenforceable.
i. Construction. The headings of Sections in this Amendment
are provided for convenience only and will not affect its construction or
interpretation. All references to "Sections" refer to the corresponding
Sections of this Amendment.
j. Governing Law. This Amendment will be governed by and
construed under the laws of the State of Idaho without regard to conflicts-
of-laws principles that would require the application of any other law.
k. Execution of Amendment. This Amendment may be executed in
one or more counterparts, each of which will be deemed to be an original copy
of this Amendment and all of which, when taken together, will be deemed to
constitute one and the same agreement. The exchange of copies of this
Amendment and of signature pages by facsimile transmission shall constitute
effective execution and delivery of this Amendment as to the parties and may
be used in lieu of the original Amendment for all purposes. Signatures of the
parties transmitted by facsimile shall be deemed to be their original
signatures for all purposes.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
TSL ACQUISITION CORP.
By: William F. Wright
--------------------------------
Name: William F. Wright
Title: Chairman of the Board and
Chief Executive Officer
AMCON DISTRIBUTING COMPANY
By: William F. Wright
---------------------------------
Name: William F. Wright
Title: Chairman of the Board and
Principal Executive Officer
TRINITY SPRINGS, LTD.
By: Dean Barney
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Name: Dean Barney
Title: Chief Executive Officer
EXHIBIT I
See Promissory Note attached hereto.
EXHIBIT II
1. Hammett Debt Consent
2. Warm Springs Enterprise Lease
3. U.S. Capital Garantomat Sleeve Machine
4. New Connections Broker Agreement
5. Modular Building Lease
EXHIBIT III
Description of Office Lease
EXHIBIT IV
See Schedules Attached Hereto