IMPROVED PROPERTY COMMERCIAL CONTRACT
1. PARTIES: McNEIL INTERESTS. INC. a Texas corporation ("Seller") agrees to
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sell and convey to RCI HOLDINGS. INC a Texas corporation ("Buyer") and
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Buyer agrees to buy from Seller the Property described below.
2. PROPERTY:
A. The property sold by this Contract is called the "Property," The
Property is the Building and land commonly known as 9009 Airport
Blvd., Houston, Harris County, Texas totaling approximately 99,085
square feet comprised of Reserve B & Reserve C located at 9009 Airport
Blvd., Houston, Harris County, Texas, together with improvements to
the Land and all water capacity, waste water capacity, and any other
rights belonging to Seller associated with the Property, being more
particularly described by metes and bounds on Exhibit "A" attached or
to be attached hereto and made a part hereof for all purposes.
B. The Property is sold together with:
(1) all improvements thereon and fixtures;
(2) all rights, privileges, and appurtenances pertaining to the
Property, including Seller's right, title, and interest in any
minerals, utilities, adjacent streets, alleys, strips, gores, and
rights-of-way;
(3) Seller's interest in all leases, rents, and security deposits for
all or part of the Property, if any;
(4) Seller's interest in all licenses and permits related to the
Property;
(5) Seller's interest in all third party warranties or guaranties, if
transferable, relating to the Property or any fixtures; and
(6) the following personal property:______________________________
(Describe any exceptions, reservations, or restrictions in Paragraph 11 or
an addendum.)
(If the Property is a condominium, attach condominium addendum.)
3. SALES I PRICE: At or before closing, Buyer will pay the following sales
price for the Property:
A. Cash portion payable by Buyer at closing. . . . . . $ 500,000.00
B. Non-cash portion of Sales Price . . . . . . . . . . $ 800,000.00*
C. Sales price (sum of A and B). . . . . . . . . . . . $ 1,300,000.00
* Non-cash portion of the Sales Price shall be 160,000 shares of
restricted common stock of the Rick's Cabaret International, Inc.
("Rick's"), trading under the NASDAQ Symbol RICK (the "Shares"). See
additional terms of non-cash portion of the Sales Price under
Paragraph 11A.
4. FINANCING: Buyer will finance the portion of the sales price under
Paragraph 3B as follows: (Check all that apply.)
[_] A. Third Party Financing: A third party note(s) in the total amount of
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$_______________. This Contract:
[_] (1) is not contingent upon Buyer obtaining third party financing.
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[_] (2) is contingent upon Buyer obtaining third party financing in
accordance with the attached Financing Addendum.
[_] B. Assumption: In accordance with the attached Financing Addendum, Buyer
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will assume the unpaid principal balance of the first lien promissory
note, which balance at closing will be $_______________.
[_] C. Seller Financing: None.
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5. EARNEST MONEY: Not later than 3 days after the effective date, Buyer must
deposit $ 5.000.00 as earnest money with AmeriTrust Title Company (escrow
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agent) at 11211 Katy Freeway. Suite 150. Houston. Texas 77079. attention:
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Joyce Whitacre (escrow agent's address). If Buyer fails to timely deposit
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the earnest money, Seller may terminate this Contract by providing written
notice to Buyer before Buyer deposits the earnest money and may exercise
Seller's remedies under Paragraph 15. Buyer may instruct the escrow agent
to deposit the earnest money in an interest-bearing account at a federally
insured financial institution and to credit any interest to Buyer.
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6. TITLE POLICY, SURVEY, AND UCC SEARCH:
A. Title Policy:
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(1) Seller will furnish Buyer an Owner's Policy of Title Insurance
(the title policy) issued by AMERITRUST TITLE COMPANY (the title
company) in the amount of the Sales Price, dated at or after
closing, insuring Buyer against loss under the title policy,
subject only to:
(a) those title exceptions permitted by this Contract or as may
be approved by Buyer in writing; and
(b) the standard printed exceptions contained in the promulgated
form of title policy unless this Contract provides
otherwise.
The cost for the title policy will be split between the Seller
and Buyer.
(2) The standard printed exception as to area boundaries: (Check (a)
or (b) only.)
[_] (a) will not be deleted from the title policy.
[X] (b) will be amended to read "shortages in areas" at the expense
of [_] Buyer [X] Seller.
(3) Buyer may object to any restrictive covenants on the Property
within the time required under Paragraph 6D.
(4) Within fifteen (15) days after the effective date, Seller will
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furnish Buyer a commitment for title insurance (the commitment)
including legible copies of recorded documents evidencing title
exceptions. Seller authorizes the title company to deliver the
commitment and related documents to Buyer at Buyer's address.
B. Survey:
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(1) Within thirty (30) days after the effective date: (Check all that
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apply.)
[_] (a) Buyer will obtain a survey of the Property at Buyer's
expense and deliver a copy of the survey to Seller.
[X] (b) Seller will furnish Buyer a survey of the Property dated
after the effective date. The cost of the survey will be split between
the Seller and Buyer.
-OR-
[X] (c) Seller will deliver a true and correct copy of Seller's
existing survey of the Property dated less than one (1) year
from the Closing. Seller, at Seller's expense:
[X] (i) will have the existing survey recertified on a date
not earlier than 30 days prior to closing.
[_] (ii) will not have the existing survey recertified.
(2) The survey required under Paragraph 6B(1) must be made by a
Registered Professional Land Surveyor acceptable to the title
company. The survey must:
(a) identify the Property by metes and bounds or platted lot
description;
(b) show that the survey was made and staked on the ground with
corners permanently marked;
(c) set forth the dimensions and total area of the Property;
(d) show the location of all improvements, highways, streets,
roads, railroads, rivers, creeks or other waterways, fences,
easements, and rights-of-way on the Property with all
easements and rights-of-way referenced to their recording
information;
(e) show any discrepancies or conflicts in boundaries, any
visible encroachments, and any portion of the Property lying
within the 100-year flood plain as shown on the current
Federal Emergency Management Agency map;
(f) contain the surveyor's certificate that the survey is true
and correct; and
(g) be sufficient for the Title Company to delete the printed
exception as to area boundaries on the Owner's Title Policy.
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Improved Property Commercial Contract concerning
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C. UCC Search:
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[X] (1) Within fifteen (15) days after the effective date, Seller, at
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Seller's expense, will furnish Buyer a Uniform Commercial Code
(UCC) search prepared by a reporting service and dated after the
effective date. The search must identify documents that are on
file with the Texas Secretary of State and the county where the
Property is located that relate to all personal property on the
Property and show, as debtor, Seller and all other owners of the
personal property in the last 5 years.
[_] (2) Buyer does not require Seller to furnish a UCC search,
D. Buyer's Objections to the Commitment, Survey, and UCC Search:
(1) Within fifteen (15) days after Buyer receives the commitment,
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copies of the documents evidencing title exceptions, any required
survey, and any required UCC search, Buyer may object to matters
disclosed in the items if:
(a) the matters disclosed constitute a defect or encumbrance to
title to the real or personal property described in
Paragraph 2 other than those permitted by this Contract or
liens that Seller will satisfy at closing or Buyer will
assume at closing; or
(b) the items show that any part of the Property lies in a
special flood hazard area (an "A" or "V" zone as defined by
FEMA);.
(2) Seller may, but is not obligated to, cure Buyer's timely
objections within 20 days after Seller receives the objections.
The closing date will be extended as necessary to cure the
objections. If Seller fails to cure the objections by the time
required, Buyer may terminate this Contract by providing written
notice to Seller within 5 days after the time by which Seller
must cure the objections. If Buyer terminates, the earnest money,
less the independent consideration paid for Buyer's right to
terminate under Paragraph 7B(3), will be refunded to Buyer.
(3) Buyer's failure to timely object or terminate under this
Paragraph 6D is a waiver of Buyer's right to object except that
Buyer will not waive the requirements in Schedule C of the
commitment.
7. PROPERTY CONDITION: (Check A or B only.)
[X] A. Present Condition: (Check (1) or (2) only.)
[X] (1) Buyer accepts the Property in its present "as-is" condition;
however, all systems and equipment, including the telephone
equipment, must be in good working order at the time of Closing.
[_] (2) Buyer accepts the Property in its present condition except that
Seller, at Seller's expense, will complete the following before
closing:____________________________________________________
____________________________________________________________.
[X] B. Feasibility Period and Right to Terminate:
(1) Delivery of Property Information: Within twenty (20) days after
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the effective date, Seller will deliver to Buyer the following
items to the extent that the items are in Seller's possession or
are readily available to Seller. Any item not delivered is deemed
not to be in Seller's possession or readily available to Seller.
The items Seller will deliver are:
(a) copies of all current service, maintenance, and management
agreements relating to the ownership and operation of the
Property;
(b) copies of current utility capacity letters from the
Property's water and sewer service provider;
(c) copies of all current warranties and guaranties relating to
all or part of the Property;
(d) copies of fire, hazard, liability, and other insurance
policies that currently relate to the Property;
(e) copies of all leasing or commission agreements that
currently relate to all or part of the Property;
(f) a copy of the "as-built" plans and specifications of the
Property;
(g) copies of all invoices for utilities and repairs incurred by
Seller for the Property in the 24 months immediately
preceding the effective date;
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Improved Property Commercial Contract concerning
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(h) copies of all previous environmental assessments, studies,
or analyses made on or relating to the Property; and
(i) real and personal property tax statements for the Property
for the previous 2 calendar years.
(2) Inspections, Studies, or Assessments:
(a) Within twenty (20) days after the effective date, Buyer, at
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Buyer's expense, may complete or cause to be completed
inspections, studies, or assessments of the Property,
including all improvements and fixtures. Inspections,
studies, or assessments may include, but are not limited to:
(i) physical property inspections (for example, structural
pest control, mechanical, structural, electrical, and
plumbing Inspections);
(ii) economic feasibility studies;
(iii) environmental assessments (for example, soil tests,
air sampling, and paint sampling);
(iv) engineering studies;
(v) compliance inspections (for example, compliance
determination with zoning ordinances, restrictions,
building codes, and statutes); and
(vi) negotiating with the authorities in Hempstead, Texas
to secure a zoning change to permit Buyer's automobile
body shop and relating activities.
(b) Seller, at Seller's expense, will turn on all utilities
necessary for Buyer to make inspections, studies, or
assessments.
(c) In connection with Buyer's inspections, studies, and
assessments, Buyer must:
(i) employ only trained and qualified inspectors and
assessors;
(ii) notify Seller, in advance, of when the inspectors or
assessors will be on the Property;
(iii) abide by any reasonable entry rules or requirements
that Seller may require;
(iv) not interfere with existing operations or occupants of
the Property; and
(v) restore the Property to its original condition if
altered due to inspections, studies, or assessments
that Buyer completes or causes to be completed.
(d) Except for those matters that arise from the negligence of
Seller or Seller's agents, Buyer is responsible for any
claim, liability, encumbrance, cause of action, and expense
resulting from Buyer's inspections, studies, or assessments,
including any property damage or personal injury. Buyer will
indemnify, hold harmless, and defend Seller and Seller's
agents against any claim involving a matter for which Buyer
is responsible under this paragraph.
(3) Feasibility Period and Right to Terminate: Buyer may terminate
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this Contract for any reason within twenty (20) days after the
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effective date by providing Seller with written notice of
termination. If Buyer does not terminate within the time
required, Buyer accepts the Property in its PRESENT "AS IS"
CONDITION subject to the provisions of Paragraph 7A(1) herein.
(Check only one box.)
[X] (a) If Buyer terminates under this Paragraph 7B(3), the earnest
money will be refunded to Buyer less $ 100.00 that Seller
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will retain as independent consideration for Buyer's right
to terminate. Buyer has tendered the independent
consideration to Seller upon payment of the full amount
specified in Paragraph 5 to the escrow agent. The
independent consideration is to be credited to the sales
price only upon closing of the sale.
[_] (b) Buyer has paid Seller $__________ as independent
consideration for Buyer's right to terminate by tendering
such amount directly to Seller or Seller's agent. If Buyer
terminates under this Paragraph 7B(3), the earnest money
will be refunded to Buyer and Seller will retain the
independent consideration. The independent consideration
[_] will [_] will not be credited to the sales price
upon closing of the sale.
(4) Return of Property Information: If this Contract terminates for
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any reason, Buyer will, not later than 10 days after the
termination date: (a) return to Seller all those items described
in Paragraph 7B(1) that Seller delivered to Buyer and all copies
that Buyer made of those items; and (b) deliver copies of all
inspection and assessment reports (excluding economic feasibility
studies) related to the
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Improved Property Commercial Contract concerning
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Property that Buyer completed or caused to be completed. This
Paragraph 7B(4) survives termination.
(5) Contracts Affecting Operations: After Buyer's right to terminate
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under Paragraph 7B(3) expires, Seller may not enter into, amend,
or terminate any other contract that affects the operations of
the Property without Buyer's prior written approval.
8. BROKERS:
A. The brokers to this sale are: NONE
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Listing Broker License No. Other Broker License No.
Listing Broker: Other Broker represents Buyer.
[_] represents Seller.
[_] acts as an intermediary between Seller and Buyer.
B. Fees: (Check (1) or (2) only.) N/A
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[_] (1) Seller will pay Listing Broker the fee specified by separate
written commission agreement between Listing Broker and Seller.
Listing Broker will pay Other Broker the fee specified in the
Agreement Between Brokers found below the parties' signatures to
this Contract.
[_] (2) At closing, Seller will pay:
Listing Broker a total cash fee of: Other Broker a total cash fee of:
[_] ___% of the sales price. [_] ___% of the sales price.
[_] ______________________________. [_] ______________________________.
The cash fees will be paid in_______________County, Texas. Seller
authorizes escrow agent to pay the brokers from Seller's proceeds
at closing.
NOTICE: Chapter 62, Texas Property Code, authorizes a broker to
secure an earned commission with a lien against the Property.
C. The parties may not amend this Paragraph 8 without the written consent
of the brokers affected by the amendment.
9. CLOSING:
A. The closing of the sale will be on or before thirty (30) days from the
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Effective Date or within 7 days after objections to title have been
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cured, whichever date is later (the closing date). If either party
fails to close by the closing date, the non-defaulting party may
exercise the remedies in Paragraph 15.
B. At closing, Seller will execute and deliver, at Seller's expense, a
[X] general [_] special warranty deed. The deed must include a
vendor's lien if any part of the sales price is financed. The deed
must convey good and indefeasible title to the Property and show no
exceptions other than those permitted under Paragraph 6 or other
provisions of this Contract. Seller must convey the Property at
closing:
(1) with no liens, assessments, or Uniform Commercial Code or other
security interests against the Property which will not be
satisfied out of the sales price unless securing loans Buyer
assumes;
(2) without any assumed loans in default; and
(3) with no persons in possession of any part of the Property as
lessees, tenants at sufferance, or trespassers except tenants
under the written leases assigned to Buyer under this Contract.
C. At closing, Seller, at Seller's expense, will also deliver:
(1) tax statements showing no delinquent taxes on the Property;
(2) a bill of sale with warranties to title conveying title, free and
clear of all liens, to any personal property defined as part of
the Property in Paragraph 2 or sold under this Contract;
(3) an assignment of all leases to or on the Property;
(4) to the extent that the following items are assignable, an
assignment to Buyer of the following items as they relate to the
Property or its operations:
(a) licenses and permits;
(b) maintenance, management, and other contracts; and
(c) warranties and guaranties;
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Improved Property Commercial Contract concerning
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(5) a rent roll current on the day of the closing certified by Seller
as true and correct;
(6) evidence that the person executing this Contract is legally
capable and authorized to bind Seller; and
(7) any notices, statements, certificates, or other documents
required by this Contract or law necessary to convey the
Property, all of which must be completed and executed by Seller
as necessary.
D. At closing, Buyer will:
(1) pay the cash portion of the Sales Price in good funds acceptable
to the escrow agent;
(2) enter a promissory note in the amount of the deferred Sales Price
and all security documents;
(3) deliver evidence that the person executing this Contract is
legally capable and authorized to bind Buyer; and
(4) execute and deliver any notices, statements, certificates, or
other documents required by this Contract or law necessary to
close the sale.
E. Unless the parties agree otherwise, the closing documents will be as
found in the basic forms in the current edition of the State Bar of
Texas Real Estate Forms Manual without any additional clauses.
10. POSSESSION: Seller will deliver possession of the Property to Buyer upon
closing and funding of this sale in its present condition subject to the
requirements of Paragraph 7(A)(1), with any repairs Seller is obligated to
complete under this Contract, ordinary wear and tear excepted. Until
closing, Seller will operate the Property in the same manner as on the
effective date and will not transfer or dispose of any of the personal
property described in Paragraph 2B or sold under this Contract. Any
possession by Buyer before closing or by Seller after closing that is not
authorized by a separate written lease agreement is a landlord-tenant at
sufferance relationship between the parties.
11. SPECIAL PROVISIONS: (Identify exhibit if special provisions are contained
in an attachment.)
A. Additional terms to non-cash portion of Sales Price: "Put" Option: On
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or after nine (9) months from the date of filing the registration
statement with the SEC, hereinafter defined. Seller shall have the
right, but not the obligation, to have Buyer purchase from Seller a
total of 160,000 Shares of Rick's common stock at a rate of 10,000
Shares per month (the "Monthly Shares") at a price of $5.00 per share
(the "Share Value") until such time as Seller receives a total of
$800,000 from the sale of the Shares (the "Put Option").
At Buyer's election, during any given month, it may either buy the
Monthly Shares, or if Buyer elects not to buy the Monthly Shares from
Seller, then Seller shall sell the Monthly Shares in the open market.
Any deficiency between the amount Seller receives from the sale of the
Monthly Shares and the Share Value shall be paid by Buyer within three
(3) days of the date of sale of the Monthly Shares during that
particular month. Seller shall give Buyer written notice of its
election to "Put" the Monthly Shares to Buyer during any particular
month. Upon such written notice, Buyer shall have three (3) business
days to elect to buy the Monthly Shares from Seller or instruct Seller
to sell the Monthly Shares in the open market. Buyer's obligation
under the Put Option to purchase the Monthly Shares from Seller shall
terminate and cease at such time as Seller has received a total of
$800,000 from the sale of the Shares. Seller agrees to provide monthly
statements to Buyer as to the total number of Shares which it has sold
and the amount of proceeds derived therefrom. Nothing to be contained
in the definitive agreement shall limit or preclude Seller from
selling the Shares in the open market or require Seller to "Put" the
Shares to Buyer during any given month.
Registration Rights: Buyer agrees to file a Registration Statement
under the Securities Act of 1933, as amended (the "Act") within
forty-five (45) days after Closing with the Securities and Exchange
Commission ("SEC") on Form SB-2 or Form S-3 or other similar form
(except on Form S-8 or Form S-4) to register for resale of the Shares
(the "Registration Statement"). Buyer will use its best efforts to
cause the Registration Statement to become effective under the Act
(the "Act Effective Date"), as promptly as is practical and to keep
the Registration Statement continuously effective under the Act for a
period of the earlier of (I) two years from the Act Effective Date, or
(ii) until all of the Shares which were registered for re-sale have
been sold.
B. Notwithstanding any other language contained herein to the contrary,
Seller shall assign to Buyer at Closing those certain lease agreements
between Seller and its current tenants. Such assignment shall be
without any warranties other than title.
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12. SALES EXPENSES:
A. Seller's Expenses: Seller will pay for the following in cash at or
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before closing:
(1) releases of existing liens, other than those liens assumed by
Buyer, including prepayment penalties and recording fees;
(2) release of Seller's loan liability, if applicable;
(3) tax statements or certificates;
(4) preparation of the deed and any bill of sale;
(5) one-half of any escrow fee;
(6) costs to record any documents to cure title objections that
Seller must cure; and
(7) other expenses that Seller will pay under other provisions of
this Contract.
B. Buyer's Expenses: Buyer will pay for the following in cash at or
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before closing:
(1) all loan fees or expenses (for example, application fees,
origination fees, discount fees, appraisal fees, assumption fees,
recording fees, tax service fees, mortgagee title policy
expenses, credit report fees, document preparation fees, interest
expense that Buyer's lender requires Buyer to pay at closing, and
other fees required by Buyer's lender);
(2) preparation fees of any deed of trust;
(3) recording fees for the deed and any deed of trust;
(4) premiums for flood and hazard insurance as may be required by
Buyer's lender;
(5) one-half of any escrow fee;
(6) copy and delivery fees for delivery of the title commitment and
related documents; and
(7) other expenses that Buyer will pay under other provisions of this
Contract.
13. PRORATIONS, ROLLBACK TAXES, ESTOPPEL CERTIFICATES, RENT, AND DEPOSITS:
A. Prorations:
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(1) Interest on any assumed loan, taxes, rents, and any expense
reimbursements from tenants will be prorated through the closing
date.
(2) If the amount of ad valorem taxes for the year in which the sale
closes is not available on the closing date, taxes will be
prorated on the basis of taxes assessed in the previous year. If
the taxes for the year in which the sale closes vary from the
amount prorated at closing, the parties will adjust the
prorations when the tax statements for the year in which the sale
closes become available. This Paragraph 13A(2) survives closing.
B. Rollback Taxes: If Seller changes the use of the Property before
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closing or if a denial of a special valuation on the Property claimed
by Seller results in the assessment of additional taxes, penalties, or
interest (assessments) for periods before closing, the assessments
will be the obligation of Seller. If this sale or Buyer's use of the
Property after closing results in additional assessments for periods
before closing, the assessments will be the obligation of Buyer. This
Paragraph 13B survives closing.
14. CASUALTY LOSS AND CONDEMNATION:
A. If any part of the Property is damaged or destroyed by fire or other
casualty after the effective date, Seller must restore the Property to
its previous condition as soon as reasonably possible and not later
than the closing date. If, without fault, Seller is unable to do so,
Buyer may:
(1} terminate this Contract and the earnest money, less the
independent consideration paid for Buyer's right to terminate
under Paragraph 7B(3), will be refunded to Buyer;
(2) extend the time for performance up to 15 days and the closing
date will be extended as necessary; or
(3) accept at closing; (i) the Property in its damaged condition;
(ii) an assignment of any insurance proceeds Seller is entitled
to receive along with the insurer's consent to the assignment;
and (iii) a credit to the sales price in the amount of any unpaid
deductible under the policy for the loss.
B. If before closing, condemnation proceedings are commenced against any
part of the Property, Buyer may:
(1) terminate this Contract by providing written notice to Seller
within 15 days after Buyer is advised of the condemnation
proceedings and the earnest money, less the independent
consideration paid for Buyer's right to terminate under Paragraph
7B{3), will be refunded to Buyer; or
(2) appear and defend the condemnation proceedings and any award
will, at Buyer's election, belong to:
(a) Seller and the sales price will be reduced by the same
amount; or
(b) Buyer and the sales price will not be reduced.
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15. DEFAULT:
A. If Buyer fails to comply with this Contract, Buyer is in default and
Seller may:
(1) enforce specific performance, or seek other relief as may be
provided by law, or both; or
(2) terminate this Contract and receive the earnest money as
liquidated damages, thereby releasing the parties from this
Contract.
B. If, without fault, Seller is unable within the time allowed to deliver
the estoppel certificates or the commitment, Buyer may:
(1) terminate this Contract and receive the earnest money, less the
independent consideration paid for Buyer's right to terminate
under Paragraph 7B(3), as the sole remedy; or
(2) extend the time for performance up to 15 days and the closing
will be extended as necessary.
C. Except as provided in Paragraph 15B, if Seller fails to comply with
this Contract, Seller is in default and Buyer may:
(1) enforce specific performance, or seek such other relief as may be
provided by law, or both; or
(2) terminate this Contract and receive the earnest money, less the
independent consideration paid for Buyer's right to terminate
under Paragraph 7B{3), as liquidated damages, thereby releasing
the parties from this Contract.
16. ATTORNEY'S FEES: If Buyer, Seller, any broker, or any escrow agent is a
prevailing party in any legal proceeding brought under or with relation to
this Contract or this transaction, such party is entitled to recover from
the non- prevailing parties all costs of such proceeding and reasonable
attorney's fees. This Paragraph 16 survives closing.
17. ESCROW:
A. At closing, the earnest money must be applied first to any cash down
payment, then to Buyer's closing costs, and any excess will be
refunded to Buyer.
B. If both parties make written demand for the earnest money, escrow
agent may require payment of unpaid expenses incurred on behalf of the
parties and a written release of liability of escrow agent from all
parties.
C. If one party makes written demand for the earnest money, escrow agent
will give notice of the demand by providing to the other party a copy
of the demand. If escrow agent does not receive written objection to
the demand from the other party within 30 days after the date escrow
agent sent the demand to the other party, escrow agent may disburse
the earnest money to the party making demand, reduced by the amount of
unpaid expenses incurred on behalf of the party receiving the earnest
money and escrow agent may pay the same to the creditors.
D. Escrow agent will deduct the independent consideration paid for
Buyer's right to terminate under Paragraph 7B(3) before disbursing any
earnest money to Buyer and will pay the independent consideration to
Seller.
E. If escrow agent complies with this Paragraph 17, each party hereby
releases escrow agent from all claims related to the disbursal of the
earnest money.
F. Notices under this Paragraph 17 must be sent by certified mail, return
receipt requested. Notices to escrow agent are effective upon receipt
by escrow agent.
18. MATERIAL FACTS:
A. To the best of Seller's knowledge and belief: (Check (1) or (2) only.)
[_] (1) Seller is not aware of any material defects to the Property
except as stated in the attached Property Condition Statement.
[X] (2) Seller is not aware of any of the following, except as described
otherwise in this Contract:
(a) any material physical defects to the Property;
(b) any pending or threatened litigation, condemnation, or
assessment affecting the Property;
(c) any environmental hazards or conditions that affect the
Property;
(d) whether the Property is or has been used for the storage or
disposal of hazardous materials or toxic waste, a dump site
or landfill, or any underground tanks or containers;
Initiated for identification by Buyer_____, and Seller _____. Page 8 of 11
Improved Property Commercial Contract concerning
9009 Airport Blvd., Houston, Harris County, Texas 77061
-------------------------------------------------------
Buyer at: RCI Holdings, Inc. Seller at: McNeil Interests, Inc.
10959 Cutten Road P. O. Box 752423
Houston, TX 77066 Houston, TX 77275-2423
Phone: 281-397-6730 Phone: 713-249-1234
Fax: 281-397-6765 Fax: 281-992-9739
With copy to: Robert D. Axelrod With copy to: Wilka Toppins
Axelrod, Smith & Kirshbaum The Toppins Law Firm, P.C.
5300 Memorial Drive, Suite 700 4900 Woodway Drive, Suite 1150
Houston, TX 77007 Houston, TX 77056
Phone: 713-861-1996 Phone: 713-621-8855
Fax: 713-552-0202 Fax: 713-621-5570
David S. Komiss II
David S. Komiss II, P.C.
6750 West Loop South, Suite 120
Bellaire, TX 77401
Phone: 713-665-2500
Fax: 713-665-7070
20. FEDERAL TAX REQUIREMENT: If Seller is a "foreign person" as defined by
applicable law, or if Seller fails to deliver at closing an affidavit that
Seller is not a foreign person, then Buyer will withhold from the sales
proceeds at closing an amount sufficient to comply with applicable tax law
and deliver the amount withheld to the Internal Revenue Service (IRS),
together with appropriate tax forms. IRS regulations require filing written
reports if cash in excess of specified amounts is received in the
transaction.
21. DISPUTE RESOLUTION: The parties agree to negotiate in good faith in an
effort to resolve any dispute related to this Contract that may arise. If
the dispute cannot be resolved by negotiation, the parties will submit the
dispute to mediation before resorting to arbitration or litigation and will
equally share the costs of a mutually acceptable mediator.
22. AGREEMENT OF THE PARTIES:
A. This Contract is binding on the parties, their heirs, executors,
representatives, successors, and permitted assigns.
B. This Contract is to be construed in accordance with the laws of the
State of Texas.
C. This Contract contains the entire agreement of the parties and may not
be changed except by written agreement.
D. If this Contract is executed in a number of identical counterparts,
each counterpart is an original and all counterparts, collectively,
constitute one agreement.
E. Buyer [X] may [_] may not assign this Contract, If Buyer assigns
this Contract, Buyer will be relieved of any future liability under
this Contract only if the assignee assumes, in writing, all of Buyer's
obligations under this Contract. Such free assignability in favor of
Buyer shall only be to an entity owned or controlled by, an affiliate
of, or a subsidiary of Buyer, otherwise consent of the Seller will be
required, which consent will not be untimely or unreasonably withheld.
Initiated for identification by Buyer_____, and Seller _____. Page 9 of 11
Improved Property Commercial Contract concerning
9009 Airport Blvd., Houston, Harris County, Texas 77061
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F. Addenda which are part of this Contract are: (Check all that apply.)
[X] (1) Property Description Exhibit identified in Paragraph 2;
[_] (2) Condominium Addendum;
[_] (3) Financing Addendum;
[_] (4) Commercial Property Condition Statement;
[_] (5) Addendum for Sellers Disclosure of Information on Lead-Based
Paint and Lead-Base Paint Hazards;
[_] (6) Notice to Purchaser of Real Property in a Water District;
[_] (7) Addendum for Coastal Area Property;
[_] (8) Addendum for Property Located Seaward of the Gulf Intracoastal
Waterway; and
[_] (9) ________________________________________________________________.
23. TIME: Time is of the essence in this Contract. The parties require strict
compliance with the times for performance. If the last day to perform under
a provision of this Contract falls on a Saturday, Sunday, or legal holiday,
the time for performance is extended until the end of the next day which is
not a Saturday, Sunday, or legal holiday.
24. EFFECTIVE DATE: The effective date of this Contract for the purpose of
performance of all obligations is the date the escrow agent receipts this
Contract after all parties execute this Contract.
25. ADDITIONAL NOTICES:
A. Buyer should have an abstract covering the Property examined by an
attorney of Buyer's selection, or Buyer should be furnished with or
obtain a title policy.
B. If the Property is situated in a utility or other statutorily created
district providing water, sewer, drainage, or flood control facilities
and services, Chapter 49, Texas Water Code, requires Seller to deliver
and Buyer to sign the statutory notice relating to the tax rate,
bonded indebtedness, or standby fees of the district before final
execution of this Contract.
C. If the Property adjoins or shares a common boundary with the tidally
influenced submerged lands of the state, Sec.33.135, Texas Natural
Resources Code, requires a notice regarding coastal area property to
be included as part of this Contract.
D. If the Property is located seaward of the Gulf Intracoastal Waterway,
Sec.61.025, Texas Natural Resources Code, requires a notice regarding
the seaward location of the Property to be included as part of this
Contract.
E. If the Property is located outside the limits of a municipality, the
Property may now or later be included in the extra-territorial
jurisdiction (ETJ) of a municipality and may now or later be subject
to annexation by the municipality. Each municipality maintains a map
that depicts its boundaries and ETJ. To determine if the Property is
located within a municipality's ETJ, Buyer should contact all
municipalities located in the general proximity of the Property for
further information,
F. If any apartments or other residential units are part of the Property
and those units were built before 1978, federal law requires a
lead-based paint and hazard disclosure statement to be made part of
this Contract.
G. Brokers are not qualified to perform property inspections, surveys,
engineering studies, environmental assessments, or inspections to
determine compliance with zoning, governmental regulations, or laws.
Buyer should seek experts to perform such services. Selection of
experts, inspectors, and repairmen is the responsibility of Buyer and
not the brokers.
26. CONSTRUCTION: The parties acknowledge that their attorneys have reviewed
and revised this Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of this Agreement.
27. CONTRACT AS OFFER: The execution of this Contract by the first party
constitutes an offer to buy or sell the Property. Unless the other party
accepts by 5:00 p.m., in the time zone in which the Property is located, on
March, 2006, the offer will lapse and become null and void.
------------
Initiated for identification by Buyer_____, and Seller _____. Page 10 of 11
Improved Property Commercial Contract concerning
9009 Airport Blvd., Houston, Harris County, Texas 77061
-------------------------------------------------------
THIS CONTRACT IS NOT THE ORIGINAL FORM PROMULGATED BY THE TEXAS ASSOCIATION OF
---
REALTORS, BUT HAS BEEN MODIFIED TO REFLECT THE CONDITIONS OF THIS PURCHASE AND
SALE.
THIS IS A LEGALLY BINDING CONTRACT. READ IT CAREFULLY. THE BROKERS AND AGENTS
MAKE NO REPRESENTATION OR RECOMMENDATION AS TO THE LEGAL SUFFICIENCY, LEGAL
EFFECT, OR TAX CONSEQUENCES OF THIS DOCUMENT OR TRANSACTION. CONSULT YOUR
ATTORNEY BEFORE SIGNING.
Buyer's Seller's
Attorneys: Robert D. Axelrod Attorney: Wilka Toppins
Axelrod, Smith & Kirshbaum The Toppins Law Firm, P.C.
5300 Memorial Drive, Suite 700 4900 Woodway Drive, Suite 1150
Houston, TX 77007 Houston, TX 77056
Phone: 713-861-1996 Phone: 713-621-8855
Fax: 713-552-0202 Fax: 713-621-5570
David S. Komiss II
David S. Komiss II P.C.
David S. Komiss II, P.C.
6750 West Loop South, Suite 120
Bellaire, TX 77401
Phone: 713-665-2500
Fax: 713-665-7070
BUYER SELLER:
RCI HOLDINGS, INC. MCNEIL INTERESTS, INC.
BY: /s/ Eric S. Langan BY: /s/ Ricky McNeil
------------------------------ ------------------------------
Eric S. Langan, President Ricky McNeil, President
ESCROW RECEIPT
Escrow agent acknowledges receipt of:
[X] A. the Contract on this day March 23, 2006 (effective date);
----------------
[X] B. earnest money in the amount of $ 5,000.00 in the form of personal/co
-----------
check on this day March 23, 2006
----- ----------------
AMERITRUST TITLE COMPANY
Escrow Agent
By: /s/ illegible
--------------------------------
Name:
Title:
Address: 11211 Katy Freeway, Suite 150
Houston, TX 77079
Phone: 713-463-0400
Fax: 713-463-9854
Initiated for identification by Buyer_____, and Seller _____. Page 11 of 11
EXHIBIT "A"
Legal Description
-----------------
[to be attached to the required Survey]
11094
RICK'S CABARET INTERNATIONAL, INC.
10959 CUTTEN RD. JP MORGAN CHASE BANK, N.A.
HOUSTON, TX 77066 DALLAS, TEXAS 95201
(281) 397-6730 32-61-1110
Mar 14, 2006
PAY TO THE
ORDER OF Ameritrust Title No. 11094 $*****$5,000.00
Five Thousand and 00/100 Dollars DOLLARS
Aneritrust Title
VOID AFTER 90 DAYS
MEMO
payment for 9009 Airport Blvd /s/ illegible
-------------------------
GF-1997 011094 111000614 1592668998
RICK'S CABARET INTERNATIONAL, INC. 11094
Invoice Invoice Invoice Discount Amount
Number Reference Date Amount Amount Paid
I/C - Reference Holding 5,000.00