Food Industry
Industry: Email Alert RSS FeedIn the United States Bankruptcy Court for the Northern District of Texas Dallas Division
Nation's Restaurant News, August 11, 2003 by Samuel M. Stricklin, John C. Leininger, Michael D. Anderson
2. Expense Reimbursement
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If (a) the Paragraph above is not applicable, (b) the transactions contemplated by the Purchase Agreement do not close for any reason other than a material breach of the Purchase Agreement by Buyer and (c) Buyer has tendered to Debtors written evidence of Buyer's willingness and ability to close the transactions described in the Purchase Agreement on the terms and conditions described therein, Debtors shall pay (in cash) to Buyer an amount equal to the costs and outof-pocket expenses incurred by Buyer in connection with its legal environmental, accounting and business due diligence and the preparation and negotiation of the Purchase Agreement in an amount not to exceed $350,000 (the "Expense Reimbursement") promptly after receipt by Debtors of documentation of such expenses that is reasonably satisfactory to Debtors. If within sixty (60) days after Buyer's right to be paid the Expense Reimbursement accrues pursuant to this Paragraph, Debtors enter into any agreement contemplating the sale of all or a substantial part of the Purchased Assets for cash consideration of $25 million or more, and a sale of the Purchased Assets thereafter occurs pursuant to such agreement, Debtors shall upon the closing of such sale pay or cause to be paid to Buyer the difference between the amount of the Breakup Fee and the amount of the Expense Reimbursement paid to Buyer (i.e. $550,000 if the Expense Reimbursement paid is $350 000). Beginning the week of June 30, 2003 and each week thereafter, the Debtors shall set aside the sum of$40,000 in a separate account (the "Buyer Reimbursement Account") until there has accumulated a total of $350,000 (the "Reimbursement Reserve"). The monies in the Buyer Reimbursement Account shall not be deemed collateral of the Bank Group. Any Expense Reimbursement to which Buyer is entitled under the Purchase Agreement shall be paid first from the Reimbursement Reserve with any unpaid balance treated as a super priority administrative claim. The Expense Reimbursement shall be paid at the Debtor's earliest opportunity or as directed by the Bankruptcy Court.
F. Failure to Consummate Purchase
If a Successful Bidder other than the Buyer fails to consummate the purchase of the Purchased Assets, and such failure to consummate the purchase is the result of a breach by the Successful Bidder, the Good Faith Deposit of such Successful Bidder shall be forfeited to the Debtors and the Debtors specifically reserve the fight to seek all available damages from such defaulting Successful Bidder.
G. Return of Earnest Money Deposit
If a Successful Bid has been selected and the sale of the Purchased Assets to a Successful Bidder has been approved by the Court, the Good Faith Deposit of the other Qualified Bidders, other than the Buyer (whose Earnest Money shall be governed by the Purchase Agreement), who are not successful bidders shall be returned. The Good Faith Deposit of the Successful Bidder shall be applied to the purchase price at closing of the transaction contemplated by the Agreement.
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