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): April 16, 1997
Exact name of registrant as
specified in its charter: CENTRAL PARKING CORPORATION
State of other jurisdiction
incorporation: Tennessee
Commission File Number: 001-13950
I.R.S. Employer
Identification Number: 62-1052916
Address of principal
executive offices: 2401 21st Avenue South,
Suite 200
Nashville, Tennessee 37212
Registrant's telephone
number, including area code: (615) 297-4255
Former name, former address
and former fiscal year,if
changed since last report: Not Applicable
Exhibit Index on Page 16
1
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
The Registrant reports the following disposition to inform
its security holders:
On April 16, 1997, the Registrant sold for cash fifty percent
of the outstanding membership units of Civic Parking, L.L.C., a limited
liability company, to an affiliate of Equity Capital Holdings, L. L. C.,
a subsidiary of Equity Office Holdings, L.L.C. Civic Parking, L.L.C.
owns four garages in St. Louis with a total of approximately 7,500 parking
spaces: Kiener East, Kiener West, Stadium East and Stadium West. The garages
have been operated by the Registrant since the early 1980's under management
agreements and since the Registrant's acquisition of all outstanding membership
units on December 31, 1996, the Registrant has operated these
facilities as owned properties. The Registrant will continue to operate
these properties pursuant to the lease/operating agreement with Civic
Parking, L.L.C.
After the sale of the 50% interest in Civic, the Company's remaining 50%
joint venture interest in Civic will be accounted for under the equity method of
accounting. The sale price of the 50% interest approximated $45.5 million
before adjustment for assets and liabilities assumed under the purchase/sale
agreement.
As a result of this transaction, the Registrant received $45.5 million
in cash, which it used to apply against outstanding long-term debt outstanding
under the revolving credit agreement with a syndicate of banks led by
SunTrust Bank, Nashville, N.A. Additionally, under the revolving credit
facility there is a permanent reduction in the borrowings available under the
facility as a result of this transaction from $150 million to $120 million.
After taking into account this transaction, the Company will have debt
outstanding under the Credit Agreement of approximately $75 million and
availability under the facility of $45 million.
2
ITEM 7 FINANCIAL STATEMENTS AND EXHIBITS
ITEM 7(b) PROFORMA FINANCIAL STATEMENTS
CENTRAL PARKING CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The following unaudited pro forma consolidated financial information of Central
Parking Corporation ("Company") is based on (a) the historical consolidated
financial statements of the Company, (b) the historical statements of direct
revenues and expenses of Civic Center Corporation ("Civic Center"), (c) the
historical financial statements of Civic Parking, L.L.C. ("Civic"), and (d) the
historical consolidated financial statements of Square Industries, Inc.
("Square").
The historical consolidated balance sheet of the Company as of December 31, 1996
presents the consolidated financial position of the Company on such date, and
reflect the Company's acquisition of Civic on December 31, 1996 using the
purchase method of accounting, based on a preliminary allocation of the purchase
price. The unaudited pro forma consolidated balance sheet as of December 31,
1996 assumes that the Company's acquisition of Square on January 18, 1997 and
the Company's subsequent sale of a 50% joint venture interest in Civic had
occurred on December 31, 1996. The Company's acquisitions of Civic and Square
are hereinafter referred to as the Acquisitions. The subsequent sale of the 50%
joint venture interest in Civic is hereinafter referred to as the Disposition.
The historical statements of earnings for the year ended September 30, 1996
reflects (a) the historical results of operations of the Company for its fiscal
year then ended, (b) the historical direct revenues and expenses of the parking
garages of Civic Center, which were managed by the Company and ultimately
acquired by the Company from Civic, for the period from January 1, 1996 to
March 20, 1996, (c) the historical results of operations of Civic for the period
from March 21, 1996 to December 31, 1996, Civic's fiscal year end, and (d) the
historical results of operations of Square for its fiscal year ended December
31, 1996.
The historical statements of earnings for the quarter ended December 31, 1996
reflect the historical results of operations of the Company for the first
quarter of its fiscal year 1997 and the historical results of operations of
Civic and Square for their respective quarters ended December 31, 1996.
The unaudited pro forma consolidated statements of earnings were prepared
assuming that the Acquisitions and Disposition were consummated on
October 1, 1995.
The unaudited pro forma consolidated financial information has been prepared
based on the historical financial statements of the Company and the acquired
entities, reclassified as necessary to conform with the presentation used in the
consolidated financial statements of the Company, and give effect to (a) the
Acquisitions under the purchase method of accounting, based on preliminary
allocations of the respective purchase prices, (b) the financing of the
Acquisitions, (c) the subsequent Disposition and related debt retirement,
(d) certain estimated operational and financial combination
benefits which are a direct result of the Square acquisition, and (e) the
assumptions and adjustments which are deemed appropriate by management of the
Company and which are described in the accompanying notes to the pro forma
consolidated financial information.
3
This pro forma consolidated financial information may not be indicative of
the results that would have occurred if the Acquisitions and Disposition had
been in effect on the dates indicated or which may be obtained in the future.
Such pro forma consolidated financial information should be read in conjunction
with such historical financial statements and notes thereto.
4
CENTRAL PARKING CORPORATION
PRO FORMA CONSOLIDATED BALANCE SHEET
December 31, 1996
(All dollar amounts are expressed in thousands)
(Unaudited)
Effects of
Square Effect of
Historical Aquisition Sale of 50% Pro Forma
--------------------- and Related Interest in Consolidated
Company Square Financing Civic Totals
--------- -------- -------------- -------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 5,850 $ 2,266 $ - $ - $ 8,116
Management accounts receivable 8,594 - - - 8,594
Accounts and current portion of notes receivable-other 3,356 1,586 - - 4,942
Prepaid expenses 6,203 2,619 - - 8,822
Other current assets - 446 - - 446
Deferred income taxes 8 419 - - 427
Refundable income taxes - 48 - - 48
--------- -------- -------------- -------------- -------------
Total current assets 24,011 7,384 - - 31,395
Investments, at amortized cost 4,551 - - - 4,551
Notes receivable, less current portion 8,027 - - - 8,027
Property, equipment, and leasehold improvements, net 131,073 30,098 30,847 (A) (91,000)(D) 101,018
Contract rights, net 5,601 - - - 5,601
Goodwill, net - - 27,724 (A) - 27,724
Investment in limited partnerships 1,240 - - - 1,240
Investment in general partnerships 1,772 - - 45,500 (D) 47,272
Non-current deferred taxes - 2,464 (2,464)(B) - -
Other assets 2,525 5,148 500 (A) - 6,224
(1,949)(A) -
--------- -------- -------------- -------------- -------------
$ 178,800 $ 45,094 $ 54,658 $(45,500) $233,052
========= ======== ============== ============== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ - $ 3,762 $ - $ - $ 3,762
Accounts payable 11,318 1,170 1,559 (A) - 14,047
Accrued expenses 6,023 9,676 1,343 (A) - 17,042
Accrued local rent tax - 2,026 - - 2,026
Management accounts payable 6,387 - - - 6,387
Income taxes payable 3,099 - - - 3,099
Other current liabilities - 373 - - 373
--------- -------- -------------- -------------- -------------
Total current liabilities 26,827 17,007 2,902 - 46,736
Long-term debt 67,200 19,419 52,681 (C) (45,500)(D) 93,800
Other liabilities 2,984 3,959 - - 6,943
Deferred income taxes 1,386 - 3,784 (B) - 5,170
--------- -------- -------------- -------------- -------------
Total liabilities 98,397 40,385 59,367 (45,500) 152,649
Shareholders' equity :
Common Stock 175 13 (13)(A) - 175
Additional paid-in capital 31,913 3,408 (3,408)(A) - 31,913
Foreign currency translation adjustment (64) (212) 212 (A) - (64)
Retained earnings 48,999 1,736 (1,736)(A) - 48,999
Deferred compensation on restricted stock, net (620) - - - (620)
Treasury stock at cost - (236) 236 (A) - -
--------- -------- -------------- -------------- -------------
Total shareholders' equity 80,403 4,709 (4,709) - 80,403
--------- -------- -------------- -------------- -------------
$ 178,800 $ 45,094 $ 54,658 $ (45,500) $233,052
========= ======== ============== ============== =============
See accompanying notes to pro forma consolidated financial information.
5-6
CENTRAL PARKING CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS
Three months ended December 31, 1996
(All dollar amounts are expressed in thousands, except per share data)
(Unaudited)
Company Square Pro Forma Civic Pro Forma
Historical Historical Adjustments Consolidated Historical Adjustments Consolidated
----------- ---------- ----------- ------------- ----------- -------------- -------------
Revenues:
Parking $ 32,085 $ 18,921 $ - $ 51,006 $ 2,448 $ (55) (J) $ 51,006
(2,393) (K)
Management contract 9,338 - - 9,338 - (53) (A) 9,338
53 (K)
----------- ---------- ----------- ------------- ----------- -------------- -------------
Total revenues 41,423 18,921 - 60,344 2,448 (2,448) 60,334
Costs and expenses:
Cost of parking 29,085 15,990 (23) (C) 45,052 1,313 (85) (C) 45,052
(53) (A) -
(33) (J) -
(1,142) (K) -
Cost of management contracts 2,501 - - 2,501 - - 2,501
Amortization of intangibles - - 302 (B) 302 - - 302
Acquisition Costs - 2,864 (2,864) (F) - - - -
General and administrative 4,708 2,300 (1,164) (H) 5,747 173 (173) (K) 5,747
(97) (G)
----------- ---------- ----------- ------------- ----------- -------------- -------------
Total costs and expenses 36,294 21,154 (3,846) 53,602 1,486 (1,486) 53,602
----------- ---------- ----------- ------------- ----------- -------------- -------------
Operating earnings (loss) 5,129 (2,233) 3,846 6,742 962 (962) 6,742
Other income (expenses):
Interest income 625 - - 625 2 (285) (D) 342
Interest expense (7) 232 (1,357) (E) (1,132) (1,008) 642 (E) (1,498)
Net gains on sales of
property and equipment 3 - - 3 - - 3
Equity in partnership and
joint venture earnings 250 - - 250 - 512 (K) 762
Write-off of Assets - (964) 612 (G) (352) - - (352)
----------- ---------- ----------- ------------- ----------- -------------- -------------
Earnings (loss) before
income taxes 6,000 (2,965) 3,101 6,136 (44) (93) 5,999
Income tax expense 2,101 38 179 (I) 2,318 - (50) (I) 2,268
----------- ---------- ----------- ------------- ----------- -------------- -------------
Net earnings (loss) 3,899 (3,003) 2,922 3,818 (44) (43) 3,731
=========== ========== =========== ============= =========== ============== =============
Weighted average shares and
share equivalents 17,620 17,620 17,620
=========== ============= =============
Net earnings per share $ 0.22 $ 0.22 $ 0.21
=========== ============= =============
See accompanying notes to pro forma consolidated financial information.
7
CENTRAL PARKING CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS
Year ended September 30, 1996
(All dollar amounts are expressed in thousands, except per share data)
(Unaudited)
Civic Civic
Company Square Pro Forma 1/1-3/20/96 3/21-12/31/96 Pro Forma
Historical Historical Adjustments Consolidated Historical Historical Adjustments Consolidated
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
REVENUES:
Parking $ 109,272 $67,869 $ - $177,141 $ 1,980 $ 8,866 $ 188 (L) $ 177,141
(320)(J)
Management (10,714)(K)
contract 34,044 - - 34,044 - - (317)(A) 34,044
317 (K)
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
Total
revenues 143,316 67,869 - 211,185 1,980 8,866 (10,846) 211,185
Costs and
expenses:
Cost of
parking 99,196 56,882 (92) (C) 155,986 626 3,884 73 (C) 155,986
(317)(A)
(134)(J)
(4,132)(K)
Cost of
management
contracts 9,769 - - 9,769 - - - 9,769
Amortization
of - 1,208
intangibles - - 1,208 (B) 1,208 - -
Acquisition - -
Costs - 2,864 (2,864) (F) - - -
General and
administra-
tive 17,419 8,781 (4,356) (H) 21,457 - 307 15 (L) 21,457
(387) (G) (322)(K)
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
Total costs
and expenses 126,384 68,527 (6,491) 188,420 626 4,191 (4,817) 188,420
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
Operating
earnings
(loss) 16,932 (658) 6,491 22,765 1,354 4,675 (6,029) 22,765
Other
income
(expenses):
Interest
income 2,303 - - 2,303 - 7 (1,130)(D) 1,180
Interest
expense - (1,296) (3,359) (E) (4,655) - (3,250) 1,786 (E) (6,119)
Net gains
on sales of
property and
equipment 1,192 - - 1,192 - - - 1,192
Equity in
partnership
and joint
venture
earnings 641 - - 641 - - 2,971 (K) 3,612
Write-off of
assets - (964) 612 (G) (352) - - - (352)
Reimbursement
of previously
incurred
fixed costs - 1,049 - 1,049 - - - 1,049
Gain from
litigation
settlement - 651 - 651 - - - 651
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
Earnings
(loss)
before
income
taxes 21,068 (1,218) 3,744 23,594 1,354 1,432 (2,402) 23,978
Income
tax
expense 7,232 470 1,227 (I) 8,929 - - 138 (I) 9,067
---------- ---------- ----------- ------------- ----------- -------------- ------------- --------------
Net
earnings
(loss) 13,836 (1,688) $ 2,517 $ 14,665 $ 1,354 $ 1,432 $ (2,540) $ 14,911
========== ========== =========== ============= =========== ============== ============= ==============
Weighted
average
shares
and share
equivalents 17,491 17,491 17,491
========== =========== ==============
Net
earnings
per share $ 0.79 $ 0.84 $ 0.85
========== =========== ===============
See accompanying notes to pro forma consolidated financial information.
8-9
CENTRAL PARKING CORPORATION
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The accompanying pro forma financial information presents the pro
forma consolidated financial condition of Central Parking
Corporation as of December 31, 1996 and the pro forma consolidated
results of operations for the three months ended December 31, 1996
and the fiscal year ended September 30, 1996.
On December 31, 1996, the Company acquired for cash 100% of the
ownership units in Civic Parking, LLC, a Missouri limited liability
company ("Civic"). On January 18, 1997, the Company completed the
acquisition of Square Industries, Inc., a New York corporation
("Square"), through a cash tender offer for all the outstanding shares
of common stock of Square. On April 16, 1997, the Company sold for cash 50% of
Civic to Equity Office Holdings - St. Louis Parking, LLC. The Company's
historical consolidated balance sheet reflects the acquired net assets and
effects of financing of Civic. The accompanying pro forma consolidated
balance sheet reflects the acquisition of Square's assets and liabilities and
the effects of the related financing, and the sale of 50% ownership in Civic and
the related debt retirement, as if the Square acquisition and the sale of 50% of
Civic had occurred on December 31, 1996. The accompanying pro forma
consolidated statements of earnings reflect the pro forma results of
operations of the Company, as adjusted, as if the acquisition of Civic and
Square, and the subsequent sale of 50% of Civic, had occurred on
October 1, 1995. The Company's 50% joint venture interest in Civic is accounted
for under the equity method of accounting.
PRO FORMA CONSOLIDATED BALANCE SHEET
The adjustments in the pro forma consolidated balance sheet are to
reflect (i) the preliminary allocation of the purchase price of Square
based upon estimates of fair value of the assets and liabilities
acquired, (ii) the effects of related borrowings, $1.6 million of
transaction costs, and $1.3 million estimated severance costs, (iii) the
recording of tangible assets acquired (goodwill of $27.7 million and
non-compete agreements of $500 thousand), (iv) the elimination of
deferred expenses, (v) the related tax effects, and (vi) the effects of the sale
of 50% of Civic and the related debt retirement. The effect of the
Company's acquisition of Civic is reflected in the Company's historical
information, based upon preliminary purchase price allocations, as the
acquisition was completed December 31, 1996. The accompanying pro forma
consolidated statements of earnings reflect the pro forma results of
operations of the Company, as adjusted, as if Civic and Square had been
acquired on October 1, 1995, and are adjusted to reflect the sale of 50% of
Civic. Final purchase price allocations are not expected to be materially
different from the preliminary allocations.
10
The adjustments reflected in the pro forma consolidated balance sheet are as
follows:
(A) To record the purchase of Square based upon the preliminary
allocation of the purchase price based upon estimates of fair
value of the assets and liabilities acquired as set forth above,
including (i) the write-up of property, plant and equipment of
$30,847,000, (ii) the recognition of the non-compete agreement
with an estimated fair value of $500,000, (iii) the elimination
of $1,949,000 of deferred expenses of Square which have no
continuing value to the Company, (iv) the recording of
transaction costs of $1,559,000, (v) the recording of
estimated severance costs of $1,343,000,
(vi) the elimination of Square's equity, and (vii) the recording
of the resultant $27,724,000 in goodwill.
(B) To adjust the deferred tax balances to reflect the net deferred
tax liabilities resulting from the difference between amounts
recorded for financial reporting and tax purposes.
(C) To record the $52,681,000 net increase in long-term debt to
finance the acquisition.
(D) To record the sale for cash of $45,500,000 of Civic and the
resultant debt reduction using sale proceeds, and to record the
Company's remaining 50% ownership interest in Civic using the
equity method of accounting.
Final purchase price allocations are not expected to be materially
different from the preliminary allocations.
PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS
The adjustments reflected in the pro forma consolidated statements
of earnings are as follows:
THREE MONTHS ENDED DECEMBER 31, 1996
(A) To eliminate management contract revenue and expense related to
the prior management agreement between Civic and the Company.
(B) To record amortization of the intangible assets. The
goodwill and non-compete are being amortized over
periods of 25 and 5 years, respectively.
(C) To reflect the net change in depreciation resulting
from the fair value adjustments and changes
in estimated asset lives.
(D) To reflect a decrease in income earned on cash
investments used for purposes of the
acquisition of Civic.
(E) To reflect interest on acquisition related borrowings, and interest
savings due to debt reduction resulting from the Civic sale.
Interest is calculated at an annual rate of 6.75%.
11
(F) To eliminate the effect of acquisition costs reflected
in Square's historical results of operations
and directly related to Square's sale to the Company.
(G) To eliminate the effect of Square's (i) scheduled
amortization of deferred expenses and
financing costs, and (ii) the write-off of $612
thousand deferred financing costs directly
related to the acquisition.
(H) To record the effect of estimated cost savings relating
to general and administrative expenses,
including excess personnel, to be eliminated
prospectively in connection with the Square
acquisition.
(I) To record estimated federal and state income taxes at a
combined rate of 36%.
(J) To eliminate the revenues and expenses related to a bus
lot not acquired, but included in the
historical financial statements of Civic for the
period from March 21, 1996 through
December 31, 1996.
(K) To reflect the elimination of 100% ownership of Civic as a
result of the sale of a 50% interest to Equity Office
Holdings-St. Louis Parking, LLC, and to reflect the remaining
50% ownership interest in Civic's operations using the
equity method of accounting.
YEAR ENDED SEPTEMBER 30, 1996
(A) To eliminate management contract revenue and expense
related to the prior management
agreement between Civic and the Company.
(B) To record amortization of the intangible assets. The
goodwill and non-compete are being
amortized over periods of 25 and 5 years,
respectively.
(C) To reflect the net change in depreciation resulting
from the fair value adjustments and changes
in estimated asset lives.
(D) To reflect a decrease in income earned on cash
investments used for purposes of the
acquisition of Civic.
(E) To reflect interest on acquisition related borrowings, and interest
savings due to debt reduction resulting from the Civic sale.
Interest is calculated at an annual rate
of 6.75%.
12
(F) To eliminate the effect of acquisition costs reflected
in Square's historical results of operations
and directly related to Square's sale to the Company.
(G) To eliminate the effect of Square's (i) scheduled
amortization of deferred expenses and
financing costs, and (ii) the write-off of $612
thousand deferred financing costs directly
related to the acquisition.
(H) To record the effect of estimated cost savings relating
to general and administrative expenses,
including excess personnel, to be eliminated
prospectively in connection with the Square
acquisition.
(I) To record estimated federal and state income taxes at a
combined rate of 36%.
(J) To eliminate the revenues and expenses related to a bus
lot not acquired, but included in the
historical financial statements of Civic for the
period March 21, 1996 through
December 31, 1996.
(K) To reflect the elimination of 100% ownership of Civic as
a result of the sale of a 50% interest to Equity Office
Holdings-St. Louis Parking, LLC, and to reflect the remaining 50%
ownership interest in Civic's operations using the equity method of
accounting.
(L) To record commercial rental income and certain property
expenses excluded from the Civic Center historical
statement of direct revenues and expenses for the
period January 1 through March 20, 1996.
13
ITEM 7(c) EXHIBITS.
The exhibits filed as a part of this Report
are listed in the Index to Exhibits immediately following the
signature page.
14
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized.
CENTRAL PARKING CORPORATION
By:/S/Stephen A. Tisdell
Stephen A. Tisdell
Chief Financial Officer
Date: April 30, 1997
15
EXHIBIT INDEX
Exhibit
Number
2.1 Form of $150,000,000 Credit Agreement dated December 12,
1996 by and among various banks with SunTrust Bank,
Nashville, N.A. as Agent, and Central Parking
Corporation and certain of its subsidiaries
(Incorporated by reference to Item 11(b)(1) to the
Company's Tender Offer Statement on Schedule 14D-1 as
filed on December 13, 1996).
2.2 Agreement for Sale and Purchase of Membership Interests,
dated as of November 22, 1996, by Central Parking System
Realty, Inc. and Central Parking System Realty of
Missouri, Inc. (direct and indirect subsidiaries,
respectively, of Central Parking Corporation) and
Gateway Groups, Inc., and SLC Holdings, LLC.
(Incorporated by reference herein to Exhibit 2.2 to the
Company's Current Report on Form 8-K as filed on
January 14, 1997).
2.3 Agreement for Purchase and Sale of Membership Interests,
dated as of April 16, 1997, by EOP-St. Louis Parking Garages, L.L.C.
(an affiliate of Equity Capital Holdings, L.L.C., a subsidiary of
Equity Office Holdings, L.L.C.) and Central Parking System Realty
of Missouri, Inc. (an indirect subsidiary of Central Parking
Corporation).
A copy of the exhibit lists to the documents listed above has
been included. The exhibits have been omitted from this filing but
the Registrant will furnish supplementally to the Commission a copy
of any omitted exhibit upon request.
16
PURCHASE AGREEMENT WITH RESPECT TO MEMBERSHIP INTEREST
BETWEEN
EOP-ST. LOUIS PARKING GARAGES, L.L.C.
AND
CENTRAL PARKING SYSTEM REALTY OF MISSOURI, INC.
Dated April 16, 1997
RE: PURCHASE OF FIFTY PERCENT MEMBERSHIP
INTEREST IN CIVIC PARKING, L.L.C.
17
TABLE OF CONTENTS
ARTICLE I - PURCHASE AND SALE OF MEMBERSHIP INTEREST 1
1.1 Purchase and Sale of Membership Interest. 1
ARTICLE II - PURCHASE PRICE 1
2.1 Purchase Price. 1
ARTICLE III - SELLER'S REPRESENTATIONS AND WARRANTIES 2
3.1 Organization. 2
3.2 Authority. 3
3.3 Authorization of Transaction; Noncontravention. 3
3.4 Ownership of Membership Interest. 3
3.5 Corporate Records. 4
3.6 Officers and Managers. 4
3.7 Compliance with Applicable Laws. 4
3.8 Contracts. 4
3.9 Real Estate. 4
3.10 Financial Statements. 5
3.11 Employees. 5
3.12 Tax Returns. 5
3.13 Personal Property. 5
3.14 Litigation. 5
3.15 Insurance Policies. 6
3.16 Guaranties. 6
3.17 Liabilities. 6
3.18 Consents. 6
ARTICLE IV - BUYER'S REPRESENTATIONS AND WARRANTIES 6
4.1 Organization. 6
4.2 Authority. 6
4.3 Transaction not a Breach. 6
ARTICLE V - OTHER AGREEMENTS 7
5.1 Closing Costs. 7
5.2 Brokerage. 7
ARTICLE VI - INTENTIONALLY DELETED 7
ARTICLE VII - CLOSING 7
7.1 Time, Date and Place of Closing. 7
7.2 Deliveries by Seller at Closing. 7
7.3 Deliveries by Buyer at Closing. 8
ARTICLE VIII - INDEMNIFICATION 8
8.1 Indemnification by Seller and CPS. 8
8.2 Indemnification by Buyer. 8
8.3 Terms of Indemnification. 8
ARTICLE IX - MISCELLANEOUS 9
9.1 Notices. 9
9.2 Severability. 10
9.3 Assignment. 10
9.4 Entire Agreement. 10
9.5 Documents. 11
9.6 Third Parties. 11
9.7 Governing Law. 11
9.8 Survival of Warranties. 11
9.9 Consent to Jurisdiction. 11
9.10 Audit Rights. 11
18
SCHEDULES
Designation & Description
Schedule 3.1 -- Foreign States of Qualification
Schedule 3.4 -- Description of Membership Interest
Schedule 3.5 -- The Certificate of Formation and
Operating Agreement
Schedule 3.6 -- Manager, Officers and Directors of
the Company
Schedule 3.7 -- Violation of Laws
Schedule 3.8 -- Contracts
Schedule 3.9 -- The Property
Schedule 3.10 -- Financial Information
Schedule 3.12 -- Tax Issues
Schedule 3.13 -- Personal Property
Schedule 3.14 -- Litigation
Schedule 3.15 -- Insurance Policies
Schedule 3.16 -- Licenses and Permits
Schedule 3.17 -- Excluded Assets and CCC Purchase
Agreement Liabilities
EXHIBITS
Exhibit 2.1(b)(D) -- Financing and Closing Costs
Exhibit 7.2(c) -- Amended and Restated Operating
Agreement
Exhibit 7.2(g) -- Operating Lease
Exhibit 7.2(h) -- Retail Management Agreement
Exhibit 9.10 -- Management Representation Letter
* * *
19
PURCHASE AGREEMENT WITH RESPECT TO MEMBERSHIP INTEREST
THIS PURCHASE AGREEMENT WITH RESPECT TO MEMBERSHIP
INTEREST ("Agreement") is entered into as of the 16th day of April,
1997 by and among CENTRAL PARKING SYSTEM REALTY OF MISSOURI, INC., a
Tennessee corporation ("Seller"), CENTRAL PARKING SYSTEM REALTY,
INC., a Tennessee corporation ("CPS"), and EOP-ST. LOUIS PARKING
GARAGES, L.L.C., a Delaware limited liability company ("Buyer").
WHEREAS, Seller is the beneficial and record owner of a
fifty percent (50%) Membership Interest (the "Membership Interest")
in Civic Parking, L.L.C., a Missouri limited liability company (the
"Company");
WHEREAS, the remainder of the membership interests in
the Company are held beneficially and of record by Seller's parent
company, CPS;
WHEREAS, Seller desires to sell to Buyer, and Buyer
desires to purchase from Seller, the Membership Interest, upon the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants of the parties as hereinafter set forth and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
ARTICLE I - PURCHASE AND SALE OF MEMBERSHIP INTEREST
1.1 Purchase and Sale of Membership Interest.
Subject to the terms and conditions set forth in this Agreement,
Seller agrees to sell, assign, transfer and deliver to Buyer at the
Closing, and Buyer agrees to purchase from Seller at the Closing,
the Membership Interest, for the purchase price set forth in Section
2 hereof.
ARTICLE II - PURCHASE PRICE
2.1 Purchase Price.
The Purchase Price (the "Purchase Price") for the Membership
Interest shall be the aggregate of:
(a) Forty-Five Million Five Hundred Thousand Dollars
($45,500,000.00); plus or minus:
(b) The net amount (which may be less than zero) of the
Price Adjustments. "Price Adjustments" means the
following:
(A) An upward Price Adjustment shall be made in an
amount equal to fifty percent (50%) of the
Company's (i) cash and cash equivalents, and (ii)
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maintenance and capital reserves (to the extent
not reflected in cash and cash equivalents), each
as of the close of business on the Closing Date;
(B) An upward Price Adjustment shall be made in the
amount of fifty percent (50%) of the Company's
receivables, net of any allowance for doubtful
accounts, as of the close of business on the
Closing Date, and a downward Price Adjustment
shall be made in the amount of fifty percent (50%)
payables as of the close of business on the
Closing Date; and
(C) Fifty percent (50%) of the rents and other monthly
revenues, real estate taxes, utilities and other
closing adjustments customarily apportioned in
real estate transactions shall be pro rated and
allocated to Buyer or Seller as upward or downward
Price Adjustments, as the case may be, in
accordance with local real estate practice, with
the Closing Date to be allocated to Buyer.
(D) An upward Purchase Price Adjustment shall be made
in an amount equal to fifty percent (50%) of the
itemized finance and closing costs incurred by
Seller in the purchase of all of the membership
interests in the Company set forth in and
described on Exhibit 2.1(b)(D).
(c) The Price Adjustments shall be determined to the extent
possible from a balance sheet (the "Closing Balance
Sheet"), which shall be prepared by the Company's
accountants as of the close of business on the day prior
to the Closing Date, in a manner consistent with past
practice, and delivered to the parties. Within sixty
(60) days after the Closing Date, Seller and Purchaser
shall cause to be prepared an audit of the Closing
Balance Sheet by KPMG Peat Marwick LLP (the "CPA"),
whose opinion thereon shall be unqualified. CPS, Seller
and Purchaser shall give the CPA full access to the work
papers from the Company's last audit. The audit shall
be prepared in accordance with generally accepted
accounting principles except that:
(i) to the extent that the accounts receivable
reflected on the Closing Balance Sheet do
not reflect a reserve for all accounts
receivable in excess of ninety (90) days, a
reserve therefore shall be made; and
(ii) the Closing Balance Sheet shall include
accrual for all liabilities (whether
contingent or absolute) known to Seller
arising out of the operation of the Company,
including, but not limited to, real estate
taxes, utilities, sales and use taxes,
warranty claims, lawsuits, claims, vacation,
sick pay, union payments and self-insured
liabilities.
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The audited Closing Balance Sheet shall be conclusive as
to the Price Adjustments, unless any party shall object
to the calculation of the amount of any Price Adjustment
as reflected on the Closing Balance Sheet by giving the
other parties notice thereof, setting forth the basis
for, and particulars of, the objection, not later than
sixty (60) business days after its receipt of the
audited Closing Balance Sheet. If such a notice of
objection is given, the parties shall attempt to resolve
the objection among themselves by mutual agreement; but
if the parties are unable to resolve the objection
within thirty (30) days after the date such notice is
given, the objection shall be resolved by Seller's and
Buyer's respective public accounting firms in such
manner as they shall determine to be appropriate and
expeditious; and such resolution shall be conclusive on
all parties.
ARTICLE III- SELLER'S REPRESENTATIONS AND WARRANTIES
Seller and CPS, jointly and severally, represent and warrant
to Buyer on the date of this Agreement and again on the Closing
Date as follows:
3.1 Organization.
The Company is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of
Missouri. To the best knowledge of Seller and CPS, except as set
forth in Schedule 3.1 attached hereto, the Company is not qualified
to do business as a foreign corporation in any state and neither
the ownership of assets nor the conduct of business by the Company
makes any such qualification necessary. Seller is a corporation
duly organized, validly existing and in good standing under the
laws of the State of Tennessee. CPS is a corporation duly
organized, validly existing and in good standing in the State of
Tennessee.
3.2 Authority.
Each of Seller and CPS has full power, right and authority to enter
into and perform its obligations under this Agreement. The
execution, delivery, and performance of this Agreement by Seller and
CPS have been duly and properly authorized by proper corporate
action in accordance with applicable law and with the Articles of
Incorporation and By-Laws of Seller.
3.3 Authorization of Transaction; Noncontravention.
(a) Except as set forth in Section 3.18, the Company does
not need to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or
governmental agency in order to consummate the transactions
contemplated by this Agreement. Subject to the required consents
21
described in Section 3.18, neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated
hereby will (i) violate any constitution, statute, regulation, rule
injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to
which the Company is subject or any provision of the Operating
Agreement or (ii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require
any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which the Company is a party or
by which it is bound or to which any of its assets is subject (or
result in the imposition of any security interest upon any of its
assets), except where the violation, conflict, breach, default,
acceleration, termination, modification, cancellation or failure to
give notice would not have a material adverse effect on the
business, financial condition, operations, results of operations, or
future prospects of the Company.
(b) Subject to the required consents described in Section
3.18, neither the execution and the delivery of this Agreement nor
the consummation of the transactions contemplated hereby will
violate any constitution, statute, regulation, rule, injunction,
judgment, order decree, ruling, charge, or other restriction of any
government, governmental agency, or court to which either Seller or
CPS is subject, or any provision of either Seller's or CPS's charter
or bylaws.
3.4 Ownership of Membership Interest.
The Company has 100 Units issued and outstanding, of which fifty
(50) Units are owned of record by the Seller and fifty (50) Units
are owned of record by CPS. All issued and outstanding Units have
been duly authorized, and are validly issued, fully paid and
nonassessable. The Units are not represented by certificates.
There are no options, warrants, purchase rights, subscription
rights, conversion rights, exchange rights, or other contracts or
commitments that could require the Company to issue or to sell,
transfer or otherwise dispose of any Units. There are no voting
trusts, proxies, or other agreements or understandings with respect
to the voting of the Units except as described in this Agreement or
in the Operating Agreement. Seller is the beneficial and record
owner of the Membership Interest as further described in Schedule
3.4 attached hereto. The Membership Interest, together with the
membership interest held by CPS, constitute 100% of the membership
interests of the Company, all of which membership interests are free
and clear of all liens, claims and encumbrances of any kind and
nature whatsoever. Seller has full right, power and authority to
transfer the Membership Interest to Buyer and upon Closing, Buyer
will receive good and marketable title to the Membership Interest
free and clear of all liens, claims and encumbrances of any kind,
nature and description. The Company has no subsidiaries. No person
or entity has any rights by way of stock option, convertible
security, subscription, warrant, contract or other agreement or
arrangement, written or oral, to purchase or acquire any membership
interest of the Company.
22
3.5 Corporate Records.
The Certificate of Formation and the currently effective Operating
Agreement and other currently effective organizational documents
(and any amendments thereto) of the Company have heretofore been
made available to Buyer, are complete and correct in all respects.
Schedule 3.5 attached hereto sets forth true and correct copies of
the currently effective Certificate of Formation and Operating
Agreement and other organizational documents (and any amendments
thereto) of the Company, said Certificate of Formation being
certified by the Secretary of State of Missouri as of a date not
earlier than thirty (30) days prior to the date of this Agreement.
3.6 Officers and Managers.
Schedule 3.6 attached hereto sets forth the name, office and term of
every officer and manager of the Company.
3.7 Compliance with Applicable Laws.
To Seller's and CPS's knowledge, except as set forth in Schedule 3.7
attached hereto, the Company has complied with all laws,
regulations, injunctions, decrees and orders applicable to it or to
the operation of its business and has received no notice of any
alleged violation of any such law, regulation, injunction, decree or
order, except where the failure to comply would not have a material
adverse effect on the business, financial condition, operations or
results of operations of the Company.
3.8 Contracts.
Attached hereto as Schedule 3.8 is a true and complete list of every
material contract, to which the Company is a party which relates,
directly or indirectly, to the Company's business, including,
without limitation, agreements relating to leases; service
contracts; agreements regarding the purchase of supplies or other
products or services; leases or other contracts relating to personal
property; loan agreements, security agreements, conditional sale or
title retention agreements or other instruments relating to
financing; and parking, storage, transportation or similar
agreements. As used in this Section 3.8, a material contract shall
mean any contract to which the Company is a party, the performance
of which will involve future consideration in excess of Ten Thousand
Dollars ($10,000.00). Seller has furnished Buyer a true and
accurate copy of each written contract and a true and accurate
summary of each oral agreement so listed on Schedule 3.8. Except as
set forth in Schedule 3.8, to Seller's knowledge, all such
contracts, agreements, relationships and commitments are in full
force and effect, enforceable in accordance with their terms, no
party is in default with respect thereto, and there is no event
which with the passage of time or giving of notice, or both, would
create a default.
23
3.9 Real Estate.
(a) The only real estate currently owned by the
Company or currently used in the operation of the Company's business
is the real estate described on Schedule 3.9 (the "Property"). With
respect to each such parcel of real property, except as reflected on
Schedule 3.9 and other matters which would not have a material
adverse effect on the financial condition of the Company:
(A) There are no pending or, to Seller's or
CPS's knowledge, threatened condemnation proceedings,
lawsuits, or administrative actions relating to such real
property or other matters affecting materially and adversely
the current use, occupancy, or value thereof; and
(B) There are no outstanding contracts, options,
agreement or rights of first refusal to purchase such real
property, or any portion thereof or interest therein.
(b) No portion of the Property is subject to any
pending condemnation, taking or other similar proceeding by any
public authority, and Seller has no knowledge nor has any grounds to
believe that any such condemnation or taking is threatened.
(c) Seller and CPS have made available to Buyer any
and all written notices, reports or other written information in
Seller's, CPS's or the Company's possession regarding the
environmental condition of the Company's real or personal property.
3.10 Financial Statements.
The financial statements described on Schedule 3.10 have been
prepared in accordance with generally accepted accounting principles
consistently applied, and truly and accurately reflect the financial
condition and results of operation of (a) the Company for the period
commencing March 21, 1996 through December 31, 1996; and (b) direct
revenue and expenses of Civic Center Corporation for the year ended
December 31, 1995 and for the period commencing January 1, 1996
through March 20, 1996. Notwithstanding the foregoing, Seller makes
no representation with respect to such portion of the financial
statements described in Schedule 3.10 to the extent related to the
retail portion of the Property.
3.11 Employees.
The Company does not have and has never had any employees. The
Company has never maintained or contributed to any employee pension
plan or employee welfare benefit plan.
3.12 Tax Returns.
The Company has filed all federal, state, county and local tax
returns which it is required to have filed, and such returns are
true, correct and complete in all material respects. To the best of
Seller's and CPS's knowledge, the Company has paid or made adequate
provision for the payment of all taxes, interest, penalties,
assessments or deficiencies which have or may become due pursuant to
such returns or pursuant to any assessment received with respect
thereto. Except as set forth in the attached Schedule 3.12, there
is pending no audit or examination of any tax return of the Company
by any governmental agency, nor has the Seller or the Company
received notice of any such audit or examination.
24
3.13 Personal Property.
Attached hereto as Schedule 3.13 is a correct and complete list of
all material personal property owned by, in the possession of, or
used by the Company in connection with its business, and constitutes
all such tangible personal property necessary for the conduct of the
Company's business as now conducted. Except as set forth in
Schedule 3.8, no personal property used by the Company in connection
with its business is held under any lease, security agreement,
conditional sales contract or other title retention or security
arrangement. The Company's assets include all items necessary or
reasonably and routinely used in the operation of the Company's
business and used in the Company's administrative, accounting and
financial operations.
3.14 Litigation.
Schedule 3.14 sets forth a description of each pending or threatened
action, suit, proceeding, hearing, complaint or investigation of, in
or before any court or quasi-judicial or administrative agency of
any federal, state, local or foreign jurisdiction or before any
arbitrator to which the Company is a party or is threatened to be
made a party, except where the resolution of such pending or
threatened matter would not have a material adverse effect on the
financial condition of the Company. For purposes of this paragraph,
"threatened" includes only those instances where the to the
knowledge of Seller or CPS, a potential claimant or party has a
present intention to institute an action, suit, proceeding, hearing,
complaint or investigation.
3.15 Insurance Policies.
Attached hereto as Schedule 3.15 is a true and complete list and
description of all insurance policies now in effect that are
applicable to the Company or the Property. Such policies are in
full force and effect, and the Company is not in default under any
of them.
3.16 Guaranties.
The Company is not a guarantor of or otherwise responsible for any
liability or obligation of any other person which guaranty or
responsibility will survive the Closing.
3.17 Liabilities.
After the Closing, the Company will have no further liabilities or
obligations arising out of the Company's prior ownership of the
"Excluded Assets" (as hereinafter defined), except as set forth in
the Agreement Relating to Parking or as disclosed in Schedule 3.17.
After the Closing, the Company will have no liability or obligation
to St. Louis National Baseball Club, Inc., Civic Center Corporation
or Anheuser-Busch Companies, Inc. or their respective Affiliates or
assignees as a result of or arising under the "CCC Purchase
25
Agreement" (as hereinafter defined), except as disclosed in Schedule
3.17. As used in this Section 3.17, the phrase "Excluded Assets"
means those assets which are described on Schedule 3.17 and which
are no longer owned by the Company, and the phrase "CCC Purchase
Agreement" means the Purchase and Sale Agreement by and among
Gateway Group, Inc., St. Louis National Baseball Club, Inc., Civic
Center Corporation and Anheuser-Busch Companies, Inc. dated as of
December 22, 1995.
3.18 Consents.
No consent of any third party is required for the execution,
performance or consummation of this Agreement and the transactions
contemplated hereunder.
ARTICLE IV - BUYER'S REPRESENTATIONS AND WARRANTIES
Buyer represents and warrants to Seller on the date of this
Agreement and again on the Closing Date as follows:
4.1 Organization.
Buyer is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of
Delaware.
4.2 Authority.
Buyer has full power, right and authority to enter into and perform
its obligations under this Agreement. The execution, delivery, and
performance of this Agreement by Buyer have been duly and properly
authorized by proper corporate action in accordance with applicable
law and with the Certificate of Formation and the Operating
Agreement of Buyer.
4.3 Transaction not a Breach.
Neither the execution and delivery of this Agreement nor its
performance by Buyer will conflict with or result in a breach of the
terms, conditions or provisions of the Certificate of Formation and
the Operating Agreement of Buyer or any contract, agreement,
mortgage or other instrument or obligation of any nature to which
Buyer is a party or by which Buyer is bound; and neither the
execution and delivery of this Agreement nor its performance by
Buyer will contravene or violate any statute or any judicial or
governmental regulation, order, injunction judgment or decree or
require the approval, consent or permission of any governmental or
regulatory body or authority.
ARTICLE V - OTHER AGREEMENTS
5.1 Closing Costs.
The closing costs (including, without limitation, transfer taxes,
documentary stamps, intangible taxes and similar taxes or charges,
title insurance premiums, survey costs, recording charges and escrow
fees) shall be paid by Buyer. Seller and Buyer shall, however, be
responsible for the fees of their respective attorneys.
26
5.2 Brokerage.
Seller and Buyer represent that they have not dealt with any brokers
in connection with this transaction. Seller and Buyer shall
indemnify and hold the other harmless from and against any and all
claims of all other brokers and finders claiming by, through or
under said party and in any way related to this Agreement,
including, without limitation, attorneys' fees in connection with
such claims.
ARTICLE VI - INTENTIONALLY DELETED
ARTICLE VII- CLOSING
7.1 Time, Date and Place of Closing.
The transaction which is the subject of this Agreement shall be
closed on April 16, 1997 at 9:00 a.m., or on such other date and
time as the parties shall mutually agree upon in writing ("the
Closing Date"). The Closing shall take place at the offices of
Rosenberg & Liebentritt, P.C. in Chicago, Illinois.
7.2 Deliveries by Seller at Closing.
At the Closing, Seller will deliver to Buyer the following
documents, in form and substance satisfactory to Buyer's counsel:
(a) An assignment of the Membership Interest, together
with all necessary consents, including, without limitation, the
consent of Company and of CPS.
(b) Certificates of the Secretary of States of
Tennessee and Missouri evidencing the good standing of Seller, CPS
and the Company.
(c) An Amended and Restated Operating Agreement for
the Company in the form attached hereto as Schedule 7.2(c).
(d) Resignations of all managers and officers of the
Company, to be effective as of the Closing.
(e) The certificate executed by Seller's President and
Secretary provided for in Section 6.1(c) hereof.
(f) Intentionally deleted.
(g) Operating Lease by and between the Company and
Central Parking System of St. Louis, Inc. in the form attached
hereto as Schedule 7.2(g).
(h) Retail Management Agreement by and between the
Company and [Equity] in the form attached hereto as Schedule 7.2(h).
27
(i) Such other documents and instruments as Buyer may
reasonably require in order to effectuate the transaction which is
the subject hereof.
7.3 Deliveries by Buyer at Closing.
At the Closing, Buyer will deliver to Seller a bank wire transfer in
the amount of the Purchase Price, as adjusted pursuant to Section
2.1(b).
ARTICLE VIII-INDEMNIFICATION
8.1 Indemnification by Seller and CPS.
Seller and CPS, jointly and severally, agree to protect, defend,
indemnify and hold harmless Buyer and its members, principals,
shareholders, directors, officers, partners, agents, employees,
successors and assigns from and against:
(a) any and all liabilities and obligations of the
Company of whatever nature, whether arising out of contract, tort,
statute or otherwise, which are applicable to the operation of the
Company's business prior to the Closing Date and which are not
included in the Closing Balance Sheet;
(b) any and all losses, damages, claims, demands,
liabilities, expenses, actions, fines, penalties, suits,
proceedings, remedial action requirements, enforcement actions of
any kind and all costs and expenses incurred in connection
therewith, including but not limited to, reasonable attorneys' fees
and expenses (hereinafter collectively referred to as "Damages"),
incurred by reason of or arising out of any misrepresentation or
breach of warranty by Seller or non-fulfillment of any covenant or
condition to be performed or complied with by Seller under the terms
of this Agreement; and
(c) any and all liabilities and Damages for all
foreign, federal, state and local income, sales, use property,
intangible and franchise taxes and any interest and penalties
relating thereto of the Company arising from periods prior to the
Closing Date (collectively "Taxes").
8.2 Indemnification by Buyer.
Buyer agrees to protect, defend, indemnify and hold harmless Seller
and its principals, shareholders, directors, officers, partners,
agents, employees, successors and assigns from and against:
(a) any and all Damages incurred by reason of or
arising out of any misrepresentation or breach of warranty by Buyer
or non-fulfillment of any covenant or condition to be performed or
complied with by Buyer under the terms of this Agreement.
8.3 Terms of Indemnification.
The foregoing indemnification obligations are subject to the
following:
28
(a) Time Periods and Maximum Liability. No party
hereto shall be required to indemnify another party pursuant to the
foregoing unless the party claiming the right to be indemnified
notifies the other party of facts which are the basis for
indemnification pursuant to this Section on or before the six (6)
month anniversary of the Closing Date; provided, however, that
notwithstanding the foregoing, (i) the time limitations set out in
this clause shall not be applicable with respect to any breach of a
representation or warranty under Sections 3.1, 3.2, 3.3, 3.4 and
3.17 or the indemnification obligations contained in Sections 8.1(a)
and (c) which indemnification provisions shall continue
indefinitely; and (ii) if prior to the close of business on the date
any representation or warranty ceases to survive, the indemnifying
party shall have received written notification of a claim for
indemnity hereunder specifying in reasonable detail the basis of any
such claim, and such claim shall not have been finally resolved or
disposed of at such date, such claim shall continue as a basis for
indemnity until it is finally resolved or disposed of, subject to
applicable statutes of limitation. If the recipient of the notice
desires to dispute such claim, it shall, within thirty (30) days
after notice of the claim of loss against it is given, give a
counternotice, setting forth the basis for disputing such claim, to
Buyer, Seller or CPS, as the case may be. If no such counternotice
is given within such thirty-day period, or if Buyer or Seller, as
the case may be, acknowledges liability for indemnification, then
such loss shall be promptly satisfied. The maximum aggregate
liability of Seller and CPS to the Buyer under this Agreement for
all indemnity obligations to Buyer shall be Five Hundred Thousand
Dollars ($500,000.00). Notwithstanding the foregoing, neither party
shall be entitled to recover under the rights to indemnification
provided hereunder until and to the extent that the aggregate of
such losses, damages or expenses suffered by such party in respect
of all such claims exceeds Ten Thousand Dollars ($10,000.00).
(b) Arbitration. If, within thirty (30) days after
the giving of counternotice by Buyer, Seller or CPS, as the case may
be, Seller, CPS and Buyer shall not have reached agreement as to the
claim in question, then the claim for indemnification shall be
submitted to and settled by arbitration as hereinafter provided (it
being expressly understood and agreed that if such counternotice is
duly given, it is the intention of the parties to this Agreement
that any such claim shall be resolved by arbitration as provided in
this section). Arbitration shall be by a single arbitrator
experienced in the matters at issue selected by Seller and Buyer in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. The meeting of the arbitrator shall be
held in St. Louis, Missouri and shall be conducted in accordance
with the Commercial Arbitration Rules existing at the date thereof
of the American Arbitration Association to the extent not
inconsistent with this Agreement. The decision of the arbitrator
shall be final and binding as to any matters submitted to him under
this Agreement, and to the extent this decision is that a loss has
been suffered for which either party is to be indemnified under this
Agreement, it shall be promptly satisfied; provided, however, that,
29
if necessary, such decision and satisfaction procedure may be
enforced by either Buyer or Seller in any court of record having
jurisdiction over the subject matter or over any of the parties
hereto. All costs and expenses incurred in connection with any such
arbitration proceeding shall be borne by the party against whom the
decision is rendered, or, if no decision is rendered or if the
decision is a compromise, equally by Buyer and Seller.
(c) Satisfaction of Loss. Any loss incurred by Seller
or Buyer, as the case may be, for which it is to be indemnified
hereunder shall be paid promptly by the indemnifying party.
ARTICLE IX - MISCELLANEOUS
9.1 Notices.
Any notices hereunder shall be in writing and shall be deemed to
have been given when delivered by hand or by telecopy or other
facsimile transaction, the first business day after sent by
overnight courier with instructions for next day delivery (such as
Federal Express), or on the second business day after deposit in the
United States Mail, registered or certified, return receipt
requested, postage prepaid, addressed to:
IF TO SELLER:
c/o Central Parking System Realty of
Missouri, Inc.
2401 21st Avenue, South, Suite 200
Nashville, Tennessee 37212
Attention: Monroe J. Carell, Jr.
Facsimile: (615) 297-6240
with a copy to:
c/o Central Parking System Realty, Inc.
2401 21st Avenue, South, Suite 200
Nashville, Tennessee 37212
Attention: Henry J. Abbott, Secretary
Facsimile: (615) 297-6240
IF TO BUYER:
c/o Equity Capital Holdings, L.L.C.
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Attn: Gary Beller
Facsimile No.: 312/906-9057
with a copy to:
Rosenberg & Liebentritt, P.C.
Two North Riverside Plaza
Suite 1515
Chicago, Illinois 60606
Attn: Kelly L. Stonebraker, Esq.
Facsimile No.: 312/454-0335
or at such other address or addresses as the parties may from time
to time specify by notice in writing to the other parties, given in
the manner provided in this Section.
30
9.2 Severability.
The unenforceability or invalidity of any provision of this
Agreement shall not affect the enforceability or validity of any
other provision.
9.3 Assignment.
Neither this Agreement nor any interest hereunder shall be assigned
or transferred by Seller or Buyer. Notwithstanding the foregoing,
Buyer may assign or otherwise transfer its interest under this
Agreement to any entity that directly or indirectly controls Buyer
or is controlled by Buyer or under common control with Buyer, in
which case the assignee shall be entitled to the benefit of and may
enforce the Seller's covenants, representations and warranties
hereunder. As used in this Agreement, the term "Buyer" shall be
deemed to include any assignee or other transferee of the initial
Buyer. Upon any such transfer by a Buyer, such Buyer shall be
relieved of any subsequently accruing liability under this
Agreement. Subject to the foregoing, this Agreement shall inure to
the benefit of and shall be binding upon Seller and Buyer and their
respective successors and assigns.
9.4 Entire Agreement.
This Agreement sets forth the entire understanding of the parties
and may be modified only by instruments signed by both of the
parties hereto.
9.5 Documents.
Each party will execute all documents and take such other actions as
the other party may reasonably request in order to consummate the
transactions provided for herein and to accomplish the purposes of
this Agreement. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same
instrument.
9.6 Third Parties.
Nothing in this Agreement is intended to confer any right or remedy
under or by reason of this Agreement on any person other than the
parties hereto and their respective successors and assigns.
9.7 Governing Law.
This Agreement shall be construed and governed in accordance with
the laws of the State of Missouri.
9.8 Survival of Warranties.
Subject to the terms and limitations of Article VIII hereunder, all
representations, warranties, indemnifications, covenants and
agreements of the parties hereto contained in or arising out of this
31
Agreement or otherwise in connection herewith shall survive the
Closing hereunder and shall continue in full force and effect
thereafter until any claim thereon would be barred by applicable
statutes of limitations.
9.9 Consent to Jurisdiction.
Seller and Buyer hereby irrevocably submit and consent to the non-
exclusive jurisdiction of any Missouri State Court sitting in the
City of St. Louis, Missouri and the United States District Court for
the District of Missouri for the purpose of resolving any dispute
arising under this Agreement, and, further consents that without
limiting other methods of obtaining jurisdiction, personal
jurisdiction over Seller or Buyer in any such action or proceeding
may be obtained within or without the jurisdiction of such court and
Seller and Buyer hereby irrevocably waive, to the fullest extent
permitted by law, any and all defenses to any such action or
proceeding based upon lack of jurisdiction, forum nonconvenience or
similar defenses. Seller hereby designates and appoints CT
Corporation System as its authorized agent to accept and acknowledge
on its behalf, service of any and all process which may be served in
any suit, action or proceeding in any court, and agree that service
of process upon said agent at said address and written notice of
said service of Seller mailed or delivered to Seller in the manner
provided herein shall be deemed in every respect effective service
of process upon Seller in any such suit, action or proceeding.
Seller shall give prompt notice to Buyer of any change of address of
its authorized agent hereunder, may at any time and from time to
time designate a substitute authorized agent with an office in St.
Louis, Missouri (which office shall be designated as the address for
service of process), and shall promptly designate such substitute
authorized agent if its authorized agent ceases to have an office in
St. Louis, Missouri or is dissolved without leaving a successor.
9.10 Audit Rights.
Seller and CPS shall provide to Buyer and its auditors (i) following
the Closing, access at all reasonable times to all financial and
other information relating to the Property necessary for Buyer and
its auditors to prepare audited financial statements in conformity
with Regulations S-X of the SEC or other materials required for any
registration statement, report or other disclosure to be filed with
the SEC or necessary to comply with any SEC rule or regulation, and
(ii) an executed representations letter, in substantially the form
attached to this Agreement as Exhibit 9.10 as required by Generally
Accepted Auditing Standards as promulgated by the Auditing Standards
Division of the American Institute of Public Accountants, which
representation is required to enable an independent public
accountant to render an opinion on such financial statements;
provided, however, that Buyer shall pay for any actual costs
incurred by Seller and CPS in connection with its obligations under
this Section 9.10. The obligation of Seller and CPS to provide such
access and representation letter shall survive the Closing.
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[Signature page to Purchase Agreement with Respect to Membership Interest]
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
BUYER:
EOP-St. Louis Parking Garages, L.L.C., a
Delaware limited liability company
By: ECH IV Holdings Limited Partnership, a Delaware
limited partnership, its sole member
By: EOP Garages, L.L.C., a Delaware limited
liability company, its general partner
By: Zell/Merrill Real Estate Opportunity Partners
Limited Partnership IV, an Illinois limited
partnership, its sole member
By: ZML Partners Limited Partnership IV, an
Illinois limited partnership, its
general partner
By: ZM Investors Limited Partnership IV,
an Illinois limited partnership, its
general partner
By: Zell/Merrill IV, Inc., an
Illinois corporation,
its general partner
SELLER: CPS:
CENTRAL PARKING SYSTEM REALTY CENTRAL PARKING SYSTEM
REALTY, INC. OF MISSOURI, INC.
By:/s/Monroe J. Carell, Jr., Chairman By:/s/Monroe J. Carell, Jr., Chairman
Monroe J. Carell, Jr., Chairman Monroe J. Carell, Jr., Chairman
33