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Disputed Partnership Interest Purchase Agreement

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DISPUTED PARTNERSHIP INTEREST PURCHASE AGREEMENT [WAREHOUSES]


THIS DISPUTED PARTNERSHIP INTEREST PURCHASE AGREEMENT [WAREHOUSES] (the "Agreement") is made this 6th day of October, 1995, by and between RONALD S. HAFT, personally ("Seller"), and DART GROUP CORPORATION ("Purchaser").


W I T N E S S E T H:


WHEREAS, Seller is the owner of the interests set forth on Exhibit A-2 (the "Undisputed Interests") in the Partnerships and/or limited liability company set forth on Exhibit A-1;


WHEREAS, Seller claims that he or the entities set forth on Exhibit A-3 are also the owners of the interests in the Partnerships as set forth on Exhibit A-3 ("RSH's Claimed Partnership Interests"), the ownership of which is disputed by Herbert H. Haft;


WHEREAS, Herbert H. Haft claims that Seller is also the owner of the interests in the Partnerships as set forth on Exhibit A-4 ("HHH's Claimed Ownership by RSH") in addition to the Undisputed Interests but in lieu of the RSH's Claimed Partnership Interests;


WHEREAS, Seller is the owner of a one percent (1%) interest as a limited partner in each of Trak Chicago Tier II Limited Partnership and 75th Avenue Tier II Limited Partnership (the "Tier II LP Interests");


WHEREAS, RSH's Claimed Partnership Interests, HHH's Claimed Ownership by RSH, and the Tier II LP Interests are hereinafter referred to collectively as the "Disputed Partnership Interests" (it being agreed that the interests in Pennsy Drive Warehouses, L.L.C. are not subject to this Agreement);


WHEREAS, Purchaser desires to buy and Seller is willing to sell the Disputed Partnership Interests, it being the intent of the parties that Seller is to quitclaim and cause the entities named on Exhibit A-3 (collectively, the "Selling Entities") to quitclaim the Disputed Partnership Interests and the economic interests appurtenant thereto (the "Disputed Economic Interests");


NOW, THEREFORE, in consideration of the foregoing, One Dollar ($1.00), the mutual promises herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser hereby agree as follows: 2
1. PURCHASE AND SALE OF PARTNERSHIP INTERESTS.


1.1 (a) Seller shall assign, sell, transfer and otherwise convey to Purchaser, and Seller shall cause each Selling Entity to assign, sell, transfer and otherwise convey to Purchaser, on a quitclaim basis (except as set forth in Section 4 below), all of Seller's and/or such Selling Entity's right, title and interest, if any, in the Disputed Partnership Interests and Disputed Economic Interests at the Closing(s) (hereinafter defined) as provided in Section 5 hereof.


(b) Seller acknowledges that Purchaser's acquisition of the Disputed Partnership Interests and Disputed Economic Interests owned or claimed by 75th Avenue Tier II Limited Partnership and Trak Chicago Tier II Limited Partnership (as shown on Exhibit A-3) will trigger material adverse tax consequences to Seller. Seller hereby waives and releases Purchaser from any claims, liability, or responsibility with respect thereto.


1.2 Notwithstanding Section 1.1 above to the contrary, if and to the extent Section 1.1 or the implementation of its provisions would give rise to a right of first offer or right of first refusal on the part of any third party who desires to exercise that right, then Section 1.1 shall, without further action by the parties, be automatically suspended or null and void with respect to the Disputed Partnership Interests and/or Disputed Economic Interests to which the third party desires to exercise such right. Seller hereby gives his consent to the conveyances set forth in Section 1.1 and waives all rights of first offer or first refusal he may have with respect thereto. To the extent he has the power and authority to do so, Seller hereby causes each Partnership and each Selling Entity to consent to the conveyances set forth in Section 1.1 and to waive all rights of first offer or first refusal they may have with respect thereto.


1.3 Seller hereby approves and waives any right of first offer or first refusal, and, to the extent he can control the Selling Entities, Seller hereby causes the Selling Entities to approve and waive any right of first offer or first refusal, with respect to any acquisition by Purchaser or its parent, subsidiary or affiliated entities of any of Herbert H. Haft's claimed interests (or any appurtenances thereto) in any of the Partnerships or in any Selling Entity.


2. PAYMENT AND PLEDGE OF PROSPECTIVE ECONOMIC BENEFITS.


2.1 Seller covenants to deliver to Purchaser all cash flow from operations which Seller and each Selling Entity may hereafter derive from his or its Disputed Interests in the Partnerships (the "Prospective Economic Benefits"), but Seller and each Selling Entity retains his/its rights to receive proceeds from capital transactions and the return of his/its


-2- 3 capital accounts (until such time as the applicable Disputed Economic Interests are assigned under this Agreement). Seller further covenants to deliver to each Partnership a notice in the form attached hereto as Exhibit D notifying each recipient to make payments of the Prospective Economic Benefits directly to Purchaser or its designees from time to time; notwithstanding anything in this Agreement to the contrary, said notice shall be delivered on the date hereof.


2.2 In addition, Seller hereby pledges, and hereby causes each Selling Entity to pledge, to Purchaser a present security interest in the Prospective Economic Benefits, the Remainder Entity Interests (hereinafter defined), the Disputed Interests and Disputed Economic Interests as set forth in the applicable Uniform Commercial Code; such interest is given to secure the performance of Seller's and the Selling Entities' obligations under this Agreement to convey ownership and/or the economic and other benefits of ownership, both before and after Closing(s) hereunder, and to secure the repayment of the $27.4 Million Note, the $37 Million Note and the $11.6 Million Note (each as defined in the Settlement Agreement (as hereinafter defined)), and is therefore coupled with an interest and irrevocable. To further evidence such security interest, Seller shall simultaneously with the execution of this Agreement enter into and cause each Selling Entity to enter into the Pledge Agreement attached as Exhibit E.


2.3 As part of the assignment of Prospective Economic Benefits, Seller further covenants that he will not take, or cause any Selling Entity to take, any action with respect to the Partnerships from and after the date hereof without first obtaining the written approval of Purchaser or its designees; provided further, that Seller will not fail to take any action with respect to the Partnerships that Purchaser may request from and after the date hereof; and, provided further, that Seller shall cause the Selling Entities to take such action with respect to the Partnerships as Purchaser may request from and after the date hereof. Without limiting the foregoing, to the extent Seller remains a general partner of a Partnership with any control over the management thereof, Seller shall cause that Partnership in accordance with its respective organizational documents to continue to operate its business in the ordinary course, including (without limitation) distributing cash flow and proceeds from capital events to the partners on a regular basis if and when available. The foregoing covenants are coupled with an interest and the rights granted to Purchaser thereunder are irrevocable.


2.4 It is intended that the assignment, pledge and security interest created under Sections 2.1 and 2.2 above and the Pledge Agreement referenced therein are pledges of general intangibles governed by Section 9-318 of the Uniform Commercial Code, as adopted in any jurisdiction relevant to this Agreement. However, if and to the extent the provisions of Sections 2.1 and 2.2 above or such Pledge Agreement would allow any other partner


-3- 4 in a Partnership to invoke a right of first offer or first refusal with respect to the Prospective Economic Benefits and such other partner indicates a desire to do so, then, without further action by the parties hereto, the provisions of Sections 2.1 and 2.2 above and such Pledge Agreement shall be suspended, and, if necessary, null and void, with respect to that Partnership until such time as such right of first offer or first refusal is inapplicable or waived.


3. CONSIDERATION. The consideration for the conveyance of the Disputed Partnership Interests and the Disputed Economic Interests and the agreements set forth herein with respect to the Prospective Economic Benefits is: (a) the settlement of various claims which the parties have against each other with respect to various stock options, employment agreements, real estate transactions and related matters, all as more fully set forth in a separate Settlement Agreement of even or approximate date herewith between Seller and Purchaser (the "Settlement Agreement") and in a Real Estate Master Agreement [Real Estate] of even or approximate date herewith among Seller, Purchaser and Cabot Morgan Real Estate Company (the "Real Estate Master Agreement"); and (b) the following cash (to be paid only in accordance with the Real Estate Master Agreement) allocated as follows:


(i) to the Disputed Partnership Interests and the Disputed Economic Interests in 3301 Pennsy Drive Associates Limited Partnership: $10.00.


(ii) to the Disputed Partnership Interests and the Disputed Economic Interests in Seventy-Fifth Avenue Associates Limited Partnership and in 75th Avenue Tier II Limited Partnership: $10.00.


(iii) to the Disputed Partnership Interests and the Disputed Economic Interests in Trak Chicago Limited Partnership I and in Trak Chicago Tier II Limited Partnership: $10.00.


(iv) to the Disputed Partnership Interests and the Disputed Economic Interests in Combined Properties/Ontario Limited Partnership: $10.00.


4. SELLER'S REPRESENTATIONS AND WARRANTIES.


Seller represents and warrants the following to Purchaser as of the date hereof, notwithstanding any independent investigation which Purchaser may have conducted (but subject to the last paragraph of this Section):


4.1 As to RSH's Claimed Partnership
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