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EXHIBIT 10.3
REAL ESTATE SALE AND NON-COMPETE AGREEMENT
REGARDING CERTAIN PROPERTIES
THIS REAL
ESTATE SALE AND NON-COMPETE AGREEMENT REGARDING CERTAIN
PROPERTIES ("Agreement") is made and
entered into this ___ day of __________,
2005, by and between John Q. Hammons Hotels
Two, L.P., a Delaware limited
partnership ("Seller"), the Revocable Trust
of John Q. Hammons, dated December
28, 1989, as amended and restated ("Buyer")
and John Q. Hammons, of Springfield,
Missouri ("Hammons").
WITNESSETH:
WHEREAS,
Seller is the owner of fee simple title to certain parcels of
undeveloped real estate, as further
referenced and described below; and
WHEREAS,
subject to certain restrictions on the development of such
parcels by Buyer, Seller desires to sell to
Buyer and Buyer desires to purchase
from Seller one of such parcels of real
estate; and
WHEREAS, Buyer
is interested in obtaining an option to purchase the other
parcel, and Seller is willing to grant to
Buyer an option to purchase such
parcel, subject to the same restrictions
and upon the terms and conditions set
forth herein;
NOW,
THEREFORE, in consideration of the promises and the mutual
undertakings and the agreements set forth
herein, the parties agree as follows:
1. Sale of Property. Subject to the other
provisions of this Agreement, Seller
agrees to sell and convey to Buyer by
special warranty deed ("Deed") and Buyer
agrees to purchase from Seller in the
manner provided herein, one (1)
undeveloped parcel of real property, as
more particularly described on Exhibit A
attached hereto (the "Omaha Parcel").
2. Purchase Price. The purchase price for
the Omaha Parcel shall be its fair
market value at the Closing hereof, as
determined by a mutually acceptable
independent and recognized appraiser with
experience appraising commercial
properties comparable to the Omaha Parcel
(the "Omaha Price"); provided,
however, that if the Omaha Price is more
than Two Million and 00/100 Dollars
($2,000,000), Buyer may terminate this
Agreement solely as it applies to the
Omaha Parcel, without further liability of
either party hereunder.
3. Method of Payment of Purchase Price. At
the Closing, the Omaha Price shall be
paid by Buyer to Seller in cash or
immediately available funds.
4. Title Matters. No later than thirty (30)
days prior to Closing, Seller shall
cause to be provided to Buyer an acceptable
title insurance commitment ("Title
Commitment") for the Omaha Parcel, issued
by a title company to be chosen by
Buyer (the "Title Company"), in which the
Title Company shall commit to issue an
ALTA form owner's policy of title insurance
("Owner's Policy"), showing Buyer as
the prospective named insured, showing the
policy
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amount as the Omaha Price, and showing the
status of Seller's title. Buyer shall
have a period of ten (10) days ("Objection
Period") following Buyer's receipt of
the Title Commitment in which to examine
the Title Commitment and, prior to the
expiration of the Objection Period, shall
advise Seller of any objections
("Title Objections") Buyer may have to
Seller's title as shown in the Title
Commitment. Seller shall then have a period
of five (5) days in which to notify
Buyer in writing of those Title Objections
it elects to cure. In the event
Seller elects to cure less than all of the
Title Objections, Buyer shall have
the right to terminate this Agreement with
respect to the Omaha Parcel by giving
Seller written notice thereof within five
(5) business days of its receipt of
Seller's notice, and thereafter neither
party shall have any further obligation
hereunder with respect to the Omaha Parcel.
In the event Buyer does not
terminate this Agreement with respect to
the Omaha Parcel, Seller shall have
until three (3) days prior to the Closing
("Cure Period") in which to cure the
Title Objections it has elected to cure. In
the event Seller is unable or
unwilling to cure all of the Title
Objections during the Cure Period, and Buyer
has not agreed in writing to waive the
uncured Title Objections, this Agreement
shall terminate as to the Omaha Parcel and
thereafter neither party shall have
any further obligation hereunder with
respect to the Omaha Parcel. Promptly
following the Closing, Seller will cause to
be issued to Buyer an Owner's Policy
in an amount equal to the Omaha Price,
insuring fee simple title to the Omaha
Parcel in Buyer, subject only to those
title exceptions or requirements
contained in the Title Commitment to which
Buyer does not object or those title
exceptions which Buyer has otherwise waived
(collectively "Permitted
Exceptions").
5. Closing. Closing shall be conditioned
upon and subject to, and shall take
place at the Title Company or other
mutually agreed upon location concurrent
with the Closing as defined in and
contemplated by that certain Amended and
Restated Transaction Agreement by and among
JD Holdings, LLC, JQH Acquisition,
LLC, John Q. Hammons, Buyer, and Hammons,
Inc. dated June 2, 2005, (the
"Transaction Agreement"). Should Closing
not occur as provided in the
Transaction Agreement, this Agreement shall
terminate and be of no further force
and effect, and the parties shall have no
further liability hereunder except as
otherwise may be specifically provided in
accordance with the Transaction
Agreement. Closing by Buyer shall be
further conditioned upon the Omaha Parcel
being in substantially the same condition
as existing as of the date hereof,
with no materially adverse change in zoning
or other development or land use
restrictions applicable to the Omaha
Parcel, in each case not caused or
requested by Buyer as a controlling entity
of Seller. At Closing, the following
shall occur:
A.
Seller's Deliveries. At Closing, Seller shall cause to be delivered
to
Buyer the
following items (all documents will be duly executed and
acknowledged where required):
(1) The Deed conveying to Buyer insurable title to the Omaha
Parcel
in an amount at least equal to the Omaha Price (subject only to
the
Permitted Exceptions), and possession of the Omaha Parcel;
(2) An Owner's Affidavit reasonably satisfactory to Seller and
the
Title Company;
(3) Such other documentation, approvals or certificates as may
be
reasonably required by the Title Company to issue its Owner's
Policy
in favor of Buyer in an amount at least equal to the Omaha
Price.
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B. Buyer's
Deliveries. Buyer shall pay the Omaha Price (as adjusted based
on the
prorations hereunder) to Seller by wire transfer to Title
Company
of
immediately available funds as required by the Title Company, and
such
other
documents, approvals, and/or certificates as may be requested by
the
Title
Company.
C. Costs.
Sellers and Buyer shall each pay one-half (1/2) of all closing
costs,
including the Title Commitment, the Closing fee charged by the
Title
Company, the appraisal fee, the premium of the standard Owner's
Policy,
all premiums and costs associated with any special endorsements
to
the
standard Owner's Policy (if any), and the costs of recording the
Deeds
conveying
titles to the Omaha Parcel to Buyer; provided, however, that
each party
shall pay their separate legal fees. Additionally, any other
expenses,
charges and fees of the Closing not specifically allocated
herein
shall be divided and paid equally between the parties.
6. Possession; Prorations. Possession of
the Omaha Parcel will be delivered to
Buyer on the date of Closing. All ad
valorem real estate taxes, annual
installments of special assessments, and
other city, county, state and school
taxes and other assessments or impositions
levied on or affecting the Omaha
Parcel, including, without limitation, any
association assessments (collectively
"Real Estate Taxes") for the calendar year
in which the Closing occurs shall be
prorated to the date of Closing; provided,
if the Real Estate Taxes for such
calendar year are not known as of the date
of Closing, the proration shall be
computed using the best evidence and
information available.
7. Option to Purchase Cary Parcel. Seller
hereby grants to Buyer the exclusive
option to purchase (the "Option") one (1)
undeveloped parcel of real property as
more particularly described on Exhibit B
attached hereto (the "Cary Parcel"), at
a purchase price equal to the fair market
value, as determined as of the date of
exercise of the Option by a mutually
acceptable independent and recognized
appraiser with experience appraising
commercial properties comparable to the
Cary Parcel (the "Cary Price"). This option
may be exercised by Buyer at any
time within one (1) year from and after the
date of Closing with respect to the
Omaha Parcel (as defined above) upon giving
Seller written notice of Buyer's
intent to exercise such option (the "Option
Notice"). The terms and conditions
of purchase shall be customary and
substantially the same as set forth herein
with respect to the Omaha Parcel, with
closing to occur on a mutually agreed
date no earlier than thirty (30) days and
no later than sixty (60) days from and
after the date of the giving of the Option
Notice. Should Buyer fail to timely
give Seller an Option Notice prior to the
expiration of the Option Term, then
this Option shall automatically expire and
neither party shall have any further
liability to the other party with respect
to the Cary Parcel. Buyer is hereby
authorized to prepare and record with the
appropriate recording office in which
the Cary Parcel is located, a Memorandum of
Option Agreement,
