Purchase Agreement - Concept Inc. and Landmark Organization Southwest Inc.
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (the "Agreement") is entered into this 17th
day of July, 1995, by and between CONCEPT INCORPORATED, a Delaware corporation
("Concept"), and LANDMARK ORGANIZATION SOUTHWEST, INC., a Delaware corporation
("Southwest").
RECITALS:
A. Southwest owns a .2% general partnership interest and a 49.5%
limited partnership interest in United Concept Limited Partnership, an Arizona
limited partnership (the "Partnership") (the "Southwest Interests"). The
Partnership owns and operates a correctional facility near Eloy, Arizona
pursuant to Contract No. J200c-151 between the Partnership and the United
States Department of Justice, Federal Bureau of Prisons, Office of Procurement
& Property, on behalf of the BOP and the United States Immigration and
Naturalization Service.
B. Southwest and certain others granted to Concept an option (the
"Option") to purchase approximately 49.995% of the interests in the
Partnership, including the Southwest Interests (collectively, the "Partnership
Interests"). The terms and conditions of the Option are set forth in that
certain Option Agreement, dated October 10, 1994, by and among Concept, Mark
Schultz, a resident of Texas, and certain other partners (the "Option
Agreement"). Concept has notified Southwest that it intends to exercise the
Option as contemplated by the Option Agreement.
C. Pursuant to Concept's exercise of the Option and pursuant to
Sections 10.2, 10.3 and 11.3 of the Agreement of Limited Partnership of the
Partnership, Concept desires to purchase, and Southwest desires to sell, the
Southwest Interests on the terms and conditions set forth herein.
NOW, THEREFORE, the parties agree as follows:
1. Purchase of Southwest Interests. Southwest hereby agrees to
sell and assign all of the Southwest Interests to Concept at the Closing and
agrees to execute such assignments and other instruments of conveyance as may
be reasonably requested by Concept in order to effectuate the transfer of the
Southwest Interests.
2. Payment of Purchase Price. Concept agrees to pay to Southwest
the sum of five million two hundred eighteen thousand five hundred dollars
($5,218,500.00) in full and complete payment for the Southwest Interests (the
"Purchase Price"), such Purchase Price to be paid by wire transfer at the
Closing or at such date as agreed to by the parties hereto.
3. Assumption of Liabilities. From and after the Closing,
Concept shall be responsible for any and all debts of the Partnership,
including, without limitation payments in connection with the Indenture
Collateralized Notes payable to First Chicago, secured by an Indenture
Agreement by and between the Partnership and First Chicago dated November 15,
1993, and all collateral agreements thereto. Concept hereby indemnifies
Landmark Organization,
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Inc. from and against any and all loss, damage, costs, expenses, and
obligations incurred by Landmark Organization, Inc. in connection therewith.
4. Closing. The closing of the transactions contemplated hereby
shall take place and be effective for all purposes at 10:00 a.m. local time, on
July 7, 1995 at the offices of Concept or at such other time and place as the
parties hereto mutually agree (the "Closing").
5. Southwest's Representations. Southwest hereby represents and
warrants to Concept as follows:
(a) Authority. Southwest has full power and authority to
execute, deliver, enter into, and perform this Agreement and all agreements,
instruments, and documents contemplated hereby and to carry out the
transactions contemplated hereby and thereby. This Agreement is a valid and
binding obligation of Southwest, enforceable against it in accordance with its
terms, subject to the limitations imposed by bankruptcy, insolvency,
moratorium, or similar laws or provisions of general application, and to the
availability of equitable remedies.
(b) Ownership. Southwest represents that (i) Southwest
is the sole owner of, and has good and marketable title to, the Southwest
Interests, free and clear of any liens, claims, charges, restrictions, security
interests, equities, proxies, pledges or encumbrances of any kind, (ii)
Southwest has full right, power, authority and capacity to sell and transfer
the Southwest Interests, and (iii) as of the Closing Date and upon receipt of
the Purchase Price, Southwest has no claims of any kind against Concept or the
Partnership.
(c) No Contravention. Neither the execution and delivery
of this Agreement nor the carrying out of the transactions contemplated hereby
or thereby, will in any respect result in any violation of or be in conflict
with any term of any agreement or instrument to which Southwest is a party or
by which it is bound, or of any law or governmental order, rule, or regulation
which is applicable to Southwest or will result in the creation or imposition
of any security interest, mortgage, lien, encumbrance, or charge upon any of
the properties or assets of Southwest. No consents or approvals of any persons
or entities, governmental or otherwise, are required which have not been
obtained with respect to the execution and delivery of this Agreement or the
transfer of the Southwest Interests and the carrying out of the transactions
contemplated hereby on the part of Southwest.
(d) Litigation. There are no claims, actions, suits,
proceedings, investigations or penalty pending or threatened by or against, or
otherwise affecting the Southwest Interests at law or in equity or before or by
any federal, state, municipal or other governmental department, commission,
board, agency, instrumentality or authority. Southwest does not know or has no
reason to know of any basis for any such claim, action, suit, proceeding or
investigation.
(e) Related Party Transactions. All transactions between
Southwest and its affiliates on the one hand and the Partnership and its
affiliates on the other hand prior to the date hereof were conducted at arm's
length and at fair value.
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(f) Professional Fees. Southwest has not done anything
to cause or incur any liability or obligation of Southwest for investment
banking, brokerage, finders, agents or other fees, commissions, expenses or
charges in connection with the negotiation, preparation, execution or
performance of this Agreement or the consummation of the transactions
contemplated hereby, and Southwest does not know of any claim by anyone for
such a fee, commission, expense or charge.
(g) Recitals. The Recitals are true and correct in all
material respects.
6. Conditions to Closing. (a) The obligations of Southwest to
consummate the transactions contemplated by this Agreement are subject to the
conditions that Concept shall have complied with all covenants and agreements
and satisfied all conditions on its part to be performed or satisfied prior to
Closing and, if the Closing shall be other than on the date hereof, Southwest
may request a certificate to that effect executed on behalf of Concept.
(b) The obligations of Concept to consummate the
transactions contemplated by this Agreement are subject to the conditions (i)
that the representations and warranties set forth in Section 5 are true and
correct on and as of the date hereof and shall be true and correct on and as of
the date of Closing, if later than the date hereof; (ii) that Southwest shall
have complied with all covenants and agreements and satisfied all conditions on
its part to be performed or satisfied prior to Closing; (iii) that Concept
shall have completed to its satisfaction a due diligence review of the
Partnership, (iv) that Concept shall have acquired, or shall acquire
simultaneously with the Southwest Interests, the remaining Partnership
Interests and (v) that Concept shall have received all required consents for
the purchase of the Southwest Interests. If the Closing shall be other than on
the date hereof, Concept may request a certificate signed by Southwest to the
effect that one or more of the foregoing conditions have been satisfied.
7. General Indemnification. Southwest hereby agrees to indemnify
and hold harmless Concept from, against, and in respect of any and all loss or
damage to Concept resulting, in whole or in part, from any breach of the
representations and warranties by Southwest contained in this Agreement, or any
misstatement or omission of fact, or failure to state the facts necessary to
make those statements made not misleading, in or pursuant to this Agreement,
and any liability or obligation arising out of any actions, suits,
proceedings, claims, demands, and judgments, (including court costs and legal
and accounting fees) incident to any of the foregoing.
8. Tax Indemnification. Concept hereby agrees to indemnify and
hold harmless Mark Schultz from, against and in respect of any federal income
tax liability attributable to taxable income of the Partnership allocated to
Mark Schultz in excess of the aggregate amount of $718,000 for taxable years
1994 and 1995. Any reimbursement made pursuant to the preceding sentence shall
be payable at the maximum individual tax rate.
9. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed given if delivered
personally or mailed by registered or certified mail (return receipt requested)
to the parties at the following addresses (or at such other
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address for a party as shall be specified by like notice; provided that notices
of a change of address shall be effective only upon receipt thereof):
(a) If to Concept to:
Concept Incorporated
102 Woodmont Boulevard
Suite 800
Nashville, TN 37205
ATTN: Doctor R. Crants
With a copy to:
Stokes & Bartholomew, P.A.
424 Church Street
Suite 2800
Nashville, TN 37219
ATTN: Elizabeth E. Moore, Esq.
(b) If to Southwest to:
Landmark Organization Southwest, Inc.
1301 Capital of Texas Highway South, #B320
Austin, Texas 78746
ATTN: Mark Schultz
With a copy to:
W. Lee Choate
Post Office Box 23
Austin, Texas 78767
10. Waivers and Consents. The parties hereto acknowledge and
agree that any notices or consents required by the Partnership Agreement to be
given to the parties hereto or their respective affiliates are hereby waived.
11. Survival. All representations, warranties, covenants and
agreements of Southwest contained in this Agreement and in any documents
delivered pursuant hereto or otherwise in connection herewith shall survive the
execution hereof and the closing of the transactions contemplated hereby.
12. Expenses. All fees and expenses incurred by Southwest,
including without limitation, legal fees and expenses, in connection with this
Agreement will be borne by Southwest
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and all fees and expenses incurred by Concept, including, without limitation,
legal fees and expenses, in connection with this Agreement will be borne by
Concept.
13. Cooperation. Each party hereto agrees after the date hereof
to execute any and all further documents and writings and perform such other
reasonable actions which may be or become necessary or expedient to effectuate
and carry out the intent of this Agreement and the transactions contemplated
hereby.
14. Governing Law. This Agreement shall be governed by the laws
of the State of Tennessee (regardless of the laws that might otherwise govern
under applicable Tennessee principles of conflicts of law).
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Purchase Agreement
as of the date first set forth above.
CONCEPT INCORPORATED
By:
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Its:
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LANDMARK ORGANIZATION SOUTHWEST, INC.
By:
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Its:
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