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Effective as of February 29, 2008
February 20, 2008
Neil Jones, President
CEDA Enterprises, Inc.
19322 E. Chaffee Avenue
Denver, CO 80249
Dear Neil:
This letter agreement ("Agreement") will set forth the terms and
conditions for the purchase by Good Times Drive Thru Inc., a
Colorado corporation ("Good Times"), of the restaurant building,
all other improvements currently existing on the real property and
all personal property and other assets which comprise the existing
Good Times restaurant located at 8930 E. Hampden Avenue, Denver,
Colorado 80231 (the "Restaurant"), from CEDA Enterprises,
Inc., a Colorado corporation ("CEDA Restaurants"). CEDA
Restaurants is hereinafter referred to as "Seller".
1. Purchased
Assets; Assumed Liabilities . The property and assets of
the Restaurant consist of the restaurant building, all other
improvements currently existing on the real property, all
furniture, fixtures, smallwares, signage, equipment, goodwill,
personal property and all other assets, tangible and intangible
property and business of every kind, character and nature
whatsoever with respect to the Restaurant, including, without
limitation, the items set forth on Exhibit A attached hereto
(collectively, the "Personal Property"), all of which are currently
owned by CEDA Restaurants. All of the foregoing Personal
Property are hereinafter referred to collectively as the
"Assets." Upon and subject to the terms and conditions set
forth in this Agreement, Good Times shall purchase all of the
Assets from Seller. Good Times shall not assume any
liabilities associated with the Restaurant other than the existing
vendor contracts.
2.
Consideration . In consideration for the Assets, Good
Times shall pay the following (collectively, the "Purchase
Price"):
a. For the Personal
Property, (i) $395,000.00 payable to CEDA Restaurants ($50,000.00
of which is attributable to the fixtures, furniture and equipment
and $345,000.00 of which is attributable to the building, leasehold
improvements and other Personal Property), a portion of which shall
be a reduction of the promissory notes made by CEDA Restaurants to
Good Times in the aggregate amount of $65,250.00, and (ii) the
mutual agreed upon value of the food and paper inventory and cash
on hand existing at the Restaurant on February 29, 2008.
3.
Contingencies . The closing of the purchase of the
Assets by Good Times is contingent upon the following
("Contingencies") being satisfied in the sole discretion of Good
Times:
a. Confirmation to
the satisfaction of Good Times that (i) the Assets will be in good
working order and free and clear of all mortgages, liens and
encumbrances at the closing and (ii) the Sellers' representations
and warranties set forth in paragraph 5 below are true and correct
on the Closing Date;
b. Mutual agreement
between CEDA Restaurants and Good Times on the Closing Date as to
the amount of cash on hand and the value of the food and paper
inventory which shall be retained by Good Times, but reimbursed as
part of the Purchase Price;
c. A satisfactory
inspection by Good Times of the condition of the Restaurant
premises and Assets on or before the Closing Date to verify that
the Restaurant premises and Assets are in substantially the same
condition as of the date of this Agreement, normal wear and tear
accepted; and
d. Confirmation
that from the date of this Agreement through the Closing Date,
there has not been any (i) transaction relating to the Restaurant
and/or Assets except in the ordinary course of business (and except
this Agreement), (ii) material adverse change in the financial
condition, liabilities, value, business or prospects of the
Restaurant and/or Assets, (iii) reduction of or destruction, damage
to, or loss or misappropriation of any of the Assets (whether or
not covered by insurance) that materially and adversely affects the
financial condition, value, business or prospects of the Restaurant
and/or Assets, (iv) mortgage, pledge, lien or other encumbrance of
any of the other Assets and (v) other event or condition of any
character or nature whatsoever that has or might reasonably have a
materially adverse effect on the financial condition, business,
liabilities, value or prospects of the Restaurant and/or
Assets.
e. Closing on the
property located at 4670 Peoria Street, Denver, Colorado pursuant
to the Letter Agreement between Good Times, CEDA Restaurants and
CEJ Investments, LLC dated February 20, 2008 and release of all
related liens in conjunction therewith.
4.
Closing .
a. The closing of
the purchase of the Assets by Good Times shall be effective as of
February 29, 2008 ("Closing Date"), provided that all Contingencies
have been satisfied. If any of the Contingencies have not
been satisfied in the sole discretion of Good Times by the closing,
Good Times may terminate this Agreement and the parties shall
thereafter be released of all liability hereunder.
b. At the closing,
Sellers and/or Good Times, as applicable, shall execute and deliver
the following documents:
(i) CEDA
Restaurants shall execute and deliver to Good Times a Bill of Sale
and Assignment for the Personal Property, substantially in the form
attached hereto as Exhibit B .
(ii) Sellers shall
execute and deliver a termination of the Assignment of Lease dated
February 29, 2008 between Good Times and CEDA Restaurants with
regard to the ground lease;
(iii) Good Times and CEDA
Restaurants shall execute a Franchise Termination Agreement
terminating the Franchise Agreement dated August 31, 1998 between
CEDA Restaurants and Good Times.
c. All utilities,
personal and real property taxes, insurance and common area
charges, if any, with respect to the Restaurant shall be prorated
as of the Closing Date. Seller shall remain liable for all
accounts payable accrued with respect to the Restaurant for the
period prior to and through the Closing Date.
d. At the closing,
CEDA Restaurants shall continue the employment of all of its
employees who were employed at the Restaurant. Good Times
shall have the right, but not the obligation, to lease any of such
employees from CEDA Restaurants thr
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