Exhibit 10.1

 

PURCHASE AND SALE AGREEMENT

 

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made and entered into as
of August 3, 2018 (“Effective Date”), by and between STORE CAPITAL ACQUISITIONS,
LLC, a Delaware limited liability company (“Purchaser”), and ARC GROUP INC., a
Nevada corporation (“Seller”). Except as otherwise expressly defined herein,
capitalized terms will have the meanings set forth on Exhibit A attached hereto
and incorporated herein by this reference. For and in consideration of the
mutual covenants and promises hereinafter set forth, the parties hereby mutually
covenant and agree as follows:

 

ARTICLE I

 

purchase of PROPERTIES

 

Section 1.01. Agreement to Purchase. Purchaser agrees to purchase, and Seller
agrees to sell, in accordance with the terms, conditions and stipulations set
forth in this Agreement (the “Transaction”), all of Seller’s right, title and
interest in and to (a) the parcel or parcels of real property, as more
particularly described on Exhibit B attached hereto, and any and all
improvements thereon and appurtenances thereto (collectively, the “Real
Property”); (b) all fixtures affixed thereto; (c) all plans, specifications and
studies pertaining to the Real Property in Seller’s possession or under its
control; (d) all mineral, oil and gas rights, water rights, sewer rights and
other utility rights allocated to the Real Property; (e) at Purchaser’s option,
all leases and rental agreements relating to the Real Property or any portion
thereof, including without limitation, all rent, prepaid rent, security deposits
and other payments and deposits; and (f) all appurtenances, easements, licenses,
privileges and other property interests belonging or appurtenant to the Real
Property (all of the foregoing items in clauses (a) through (f) above, now or
hereafter existing, individually, a “Property” and collectively, the
“Properties”). The parties acknowledge and agree that: (i) fee title to the
Properties is currently held by Fat Patty’s, LLC, West Virginia limited
liability company, and Clint Artrip, an individual (collectively, the “Current
Owner”); (ii) Seller is under contract to acquire the Properties from Current
Owner pursuant to the Existing Purchase Agreement; (iii) the obligations of
Seller under this Agreement may be satisfied by Current Owner; and (iv) unless
otherwise mutually agreed by Seller and Purchaser, Seller shall designate or
nominate Purchaser to take title to the Properties pursuant to the terms of the
Existing Purchase Agreement and the closing under the Existing Purchase
Agreement and the Closing hereunder shall be simultaneous.

 

Section 1.02. Purchase Price. The aggregate purchase price to be paid by
Purchaser to Seller for the Properties is $11,500,000 (the “Purchase Price”).
The Purchase Price shall be paid by Purchaser in immediately available federal
funds at Closing.

 

Section 1.03. Lease of Properties. On or before the expiration of the Closing
Date, Lessee and Purchaser shall agree upon the Master Lease Agreement, pursuant
to which Purchaser shall lease the Properties to Lessee, at the rent and
pursuant to the terms and conditions contained therein (the “Lease Agreement”).

 

4819-3487-6781.3

STORE/Fat Patty's

Purchase and Sale Agreement

4 Properties in KY and WV

File No. 7210/02-629.1

 

 

 

 

Section 1.04. Prorations. In view of the subsequent lease of the Properties to
Lessee pursuant to the Lease Agreement and Lessee’s obligations thereunder,
there shall be no proration of insurance, taxes, special assessments, utilities
or any other costs related to the Properties between Seller and Purchaser at
Closing. All real and personal property and other applicable taxes and
assessments, utilities and any other charges relating to the Properties which
are due and payable on or prior to the Closing Date shall be paid by Seller at
or prior to Closing, and all other taxes and assessments shall be paid by Lessee
in accordance with the terms of the Lease Agreement.

 

Section 1.05. Transaction Costs. Seller shall be responsible for the payment of
all Transaction Costs incurred by Seller and Purchaser in connection with the
Transaction, whether or not the Transaction closes; provided, however, that,
subject to Section 6.02(a) below, Seller and Purchaser shall each be responsible
for the payment of the fees and expenses of their respective legal counsel,
accountants and other professional advisers. The provisions of this Section 1.05
shall survive Closing or termination of this Agreement for any reason.

 

ARTICLE II

 

DUE DILIGENCE

 

Section 2.01. Title Insurance.

 

(a)          Title Commitments and Title Policies. Purchaser shall order owner’s
title insurance commitments (collectively, the “Title Commitments”) with respect
to the Properties issued by the Title Company, for ALTA Owner’s Extended
Coverage Title Insurance Policies, together with any endorsements, that
Purchaser may require (collectively, the “Title Policies”). Purchaser shall
cause copies of the Title Commitments to be delivered to Seller. All costs
related to the Title Policies, escrow fees and other closing costs are included
as Transaction Costs, payable by Seller.

 

(b)          Title Company. The Title Company is hereby employed by the parties
to act as escrow agent in connection with this Transaction. This Agreement shall
be used as instructions to the Title Company, as escrow agent, which may provide
its standard conditions of acceptance of escrow; provided, however, that in the
event of any inconsistency between such standard conditions of acceptance and
the terms of this Agreement, the terms of this Agreement shall prevail. The
Title Company’s receipt of this Agreement and the opening of an escrow pursuant
to this Agreement shall be deemed to constitute conclusive evidence of the Title
Company’s agreement to be bound by the terms and conditions of this Agreement
pertaining to the Title Company.

 

(c)          Title Company Actions. The Title Company is authorized to pay, from
any funds held by it for each party’s respective credit, all amounts necessary
to procure the delivery of any documents and to pay, on behalf of Purchaser and
Seller, all charges and obligations payable by them hereunder, respectively.
Seller and Purchaser will pay all charges payable by them to the Title Company.
The Title Company shall not cause the Transaction to close unless and until it
has received written instructions from Purchaser and Seller to do so. The Title
Company is authorized, in the event any conflicting demand is made upon it
concerning these instructions or the escrow, at its election, to hold any
documents and/or funds deposited hereunder until an action shall be brought in a
court of competent jurisdiction to determine the rights of Seller and Purchaser
or to interplead such documents and/or funds in an action brought in any such
court. Deposit by the Title Company of such documents and funds, after deducting
therefrom its reasonable charges, expenses and attorneys’ fees incurred in
connection with any such court action, shall relieve the Title Company of all
further liability and responsibility for such documents and funds.

 

 2 

 

  

(d)          Title Objections.

 

(i)          Within seven (7) days after the Purchaser’s receipt of both a Title
Commitment and the related Survey for each Property, Purchaser shall notify
Seller in writing of Purchaser’s objection to any exceptions or other title
matters shown on a Title Commitment or the related Survey (each, a “Title
Objection”). If any Title Objection is not removed or resolved by Seller to
Purchaser’s satisfaction at least five (5) days prior to the Closing Date, then
Purchaser shall have the option, as its sole remedy, upon written notice to
Seller on or before the Closing Date, to terminate this Agreement, in which
event neither Purchaser nor Seller shall have any further duties or obligations
under this Agreement, except as otherwise provided herein.

 

(ii)         If any supplement to a Title Commitment or the related Survey
discloses any additional title defects which were not created by or with the
consent of Purchaser, and which are not acceptable to Purchaser, Purchaser shall
notify Seller in writing of its objection thereto (each, an “Additional Title
Objection”) within five (5) days following receipt of such supplement or
revision. If any Additional Title Objection is not removed or resolved by Seller
to Purchaser’s satisfaction at least five (5) days prior to the Closing Date,
then Purchaser shall have the option, as its sole remedy, to terminate this
Agreement upon written notice to Seller on or before the Closing Date, in which
event neither Purchaser nor Seller shall have any further duties or obligations
under this Agreement, except as otherwise provided herein.

 

(iii)        Purchaser’s failure to timely deliver a Title Objection or an
Additional Title Objection shall be deemed Purchaser’s acceptance of the matters
disclosed by the Title Commitments and related Surveys. If Purchaser does not
terminate this Agreement by reason of any Title Objection or Additional Title
Objection, as provided in this Section 2.01, then such Title Objection or
Additional Title Objection shall be deemed waived and approved by Purchaser and
shall thereafter be deemed a Permitted Encumbrance.

 

Section 2.02. Seller Documents. With reasonable promptness, but in no event
later than three (3) Business Days following the Effective Date, Seller shall
deliver to Purchaser the following items to the extent the same exist and are in
Seller’s possession or under its control (collectively, the “Seller Documents”):
(a) “as-built” plans and specifications for each of the Properties; (b) a
certificate of occupancy (or its jurisdictional equivalent) for each of the
Properties; (c) all surveys related to the Properties; (d) all environmental
reports related to the Properties (including without limitation, Phase I and
Phase II environmental investigation reports); (e) all appraisals or valuations
related to the Properties; (f) all guaranties and warranties in effect with
respect to all or any portion of the Properties; (g) full and complete copies of
any existing leases and current rent rolls related thereto and all other
agreements related to the Properties, together with all amendments and
modifications thereof; (h) Seller’s, Lessee’s and Guarantor’s financial
statements and unit-level financial statements for the previous three years;
(i) intentionally deleted; (j) all property condition reports related to the
Properties; and (k) all other documents related to the ownership, lease and
operation of the Properties, and reasonably requested by Purchaser.

 

 3 

 

  

Section 2.03. Survey. Purchaser shall order a current ALTA/NSPS “as built”
survey as required for each Property from a surveyor selected by Purchaser
(collectively, the “Surveys”), together with (i) evidence reasonably
satisfactory to Purchaser to the effect that each Property fully complies with
all zoning ordinances of the Governmental Authority having jurisdiction over
each Property (“Zoning Evidence”), and (ii) evidence reasonably satisfactory to
Purchaser that the locations of the Properties are not within the 100-year flood
plain or identified as a “Special Flood Hazard Area” by the Federal Emergency
Management Agency. The Surveys shall show all improvements and shall plot all
exceptions shown on the applicable Title Commitment (to the extent plottable),
certified in favor of Purchaser, any requested Affiliate of Purchaser and Title
Company in a manner reasonably acceptable to Purchaser and prepared in
accordance with the appropriate “ALTA/NSPS” minimum standards. The cost of the
Surveys shall be paid by Seller and shall be included in the Transaction Costs.

 

Section 2.04. Environmental. Purchaser shall order a current complete Phase I
environmental investigation report for each of the Properties, and, if any
environmental investigation report recommends additional subsurface
investigation of any Property, (a) Seller shall permit Purchaser to perform such
additional subsurface investigation (each Phase I environmental investigation
report and each additional subsurface investigation report, an “Environmental
Report”), from one or more environmental inspection companies selected by
Purchaser, detailing and analyzing certain aspects of any such Property;
provided, however, that, notwithstanding the foregoing, if Seller fails or
refuses to permit any such additional subsurface investigation or is unwilling
to obtain environmental insurance providing coverage acceptable to Purchaser in
its sole discretion, Seller shall be deemed to have elected to terminate this
Agreement, whereupon, except for those provisions expressly stated to survive
termination hereof (including without limitation, the payment of Transaction
Costs and the other expenses as set forth in Section 1.05), the parties’
obligations hereunder shall terminate. The costs of the Environmental Reports
shall be paid by Seller and shall be included as Transaction Costs.

 

Section 2.05. Valuation. Purchaser shall order current site inspections and
valuations of the Properties, separately stating values for the Real Property
and improvements for each of the Properties, from one or more parties selected
by Purchaser (each a “Valuation”, and collectively, the “Valuations”). Each
Valuation shall be in form and substance acceptable to Purchaser, and shall be
certified to Purchaser and any requested Affiliate of Purchaser. The costs of
the Valuations shall be paid by Seller and shall be included in the Transaction
Costs.

 

Section 2.06. Property Condition Reports. Purchaser shall order current property
condition assessments and limited compliance audits as required for such
Properties from one or more inspection companies selected by Purchaser
(collectively, the “Property Condition Reports”). Each Property Condition Report
shall be in form and substance acceptable to Purchaser, and shall be certified
to Purchaser and any requested Affiliate of Purchaser. The cost of the Property
Condition Reports shall be paid by Seller and shall be included in the
Transaction Costs.

 

 4 

 

 

Section 2.07. Inspections. From the Effective Date and for a period of thirty
(30) days thereafter (the “Inspection Period”), (a) Purchaser may perform
whatever investigations, tests and inspections (collectively, the “Inspections”)
with respect to any one or more of the Properties that Purchaser deems
reasonably appropriate; and (b) Seller shall, at all reasonable times,
(i) provide Purchaser and Purchaser’s officers, employees, agents, advisors,
attorneys, accountants, architects, and engineers with access to the Properties,
all drawings, plans, specifications and all engineering reports for and relating
to the Properties in the possession or under the control of Seller, the files
and correspondence relating to the Properties, and the financial books and
records relating to the ownership, lease (if applicable), operation, and
maintenance of the Properties, and (ii) allow such Persons to make such
inspections, tests, copies, and verifications as Purchaser considers necessary.

 

Section 2.08. Purchaser’s Right to Terminate. Notwithstanding any provision
contained herein, in addition to its right to terminate this Agreement as set
forth in Section 2.01(d), if (a)  Purchaser determines, in its sole discretion,
that any Property is not satisfactory, and Purchaser provides written notice
thereof to Seller on or before expiration of the Inspection Period, or
(b) Purchaser and Lessee are unable to agree upon the terms and conditions of
the Lease Agreement as provided in Section 1.03 on or before the Closing Date,
or (c) Purchaser fails to obtain the approval of the Transaction from
Purchaser’s Investment Committee, and in any such event, Purchaser provides
written notice thereof to Seller on or before expiration of the Inspection
Period, or Purchaser fails to obtain the approval of any material change to the
terms of the Transaction from Purchaser’s Investment Committee prior to Closing,
then Purchaser shall have the option to terminate this Agreement in which event
neither Seller nor Purchaser shall have any further duties or obligations under
this Agreement except as otherwise provided herein (including without
limitation, the payment of Transaction Costs and the other expenses as set forth
in Section 1.05).

 

ARTICLE III

 

CLOSING

 

Section 3.01. Closing Date. Subject to the provisions of Article V of this
Agreement, the closing date of the Transaction contemplated by this Agreement
(the “Closing”) shall be set by mutual agreement of Seller and Purchaser (the
“Closing Date”); provided, however, that the Closing Date shall not extend
beyond the Closing Deadline. The parties shall deposit with the Title Company
all documents (including without limitation, the executed Transaction Documents)
as necessary to comply with the parties’ respective obligations hereunder on or
before the Closing Date or as otherwise mutually agreed upon by the parties. The
parties shall deposit all funds required hereunder with the Title Company on or
before the Closing Date.

 

Section 3.02. Funding. Notwithstanding any provision contained in this
Agreement, funding of the Transaction by Purchaser shall be contingent upon the
delivery of the executed Transaction Documents, satisfaction of the conditions
precedent set forth herein and in the other Transaction Documents, receipt and
approval of other original documents by Purchaser’s counsel, and confirmation by
Purchaser’s counsel that it or the Title Company has possession of all
Transaction Documents required by Purchaser.

 

Section 3.03. Possession. Possession of the Properties, free and clear of all
tenants or other parties in possession, except in accordance with the Lease
Agreement, shall be delivered to Purchaser on the Closing Date.

 

 5 

 

  

ARTICLE IV

 

REPRESENTATIONS WARRANTIES AND COVENANTS

 

Section 4.01. Seller. Seller represents and warrants to, and covenants with,
Purchaser as follows:

 

(a)          Organization and Authority. Seller is duly organized or formed,
validly existing and in good standing under the laws of its state of
organization, and is qualified as a foreign entity to do business in any
jurisdiction where such qualification is required. Seller has all requisite
corporate power and authority to own and operate the Properties, to execute,
deliver and perform its obligations under this Agreement and all of the other
Transaction Documents, and to carry out the Transaction. The Person who has
executed this Agreement on behalf of Seller has been duly authorized to do so.

 

(b)          Enforceability of Documents. Upon execution by Seller, Lessee and
Guarantor, respectively, this Agreement and the other Transaction Documents to
which each is a party, shall constitute the legal, valid and binding obligations
of Seller, Lessee and Guarantor, respectively, enforceable against Seller,
Lessee and Guarantor in accordance with their respective terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium, or other similar laws relating to or affecting the
rights of creditors generally, or by general equitable principles.

 

(c)          No Other Agreements and Options. None of Seller, Lessee, Guarantor
or any Property is subject to any commitment, obligation, or agreement,
including, without limitation, any right of first refusal, option to purchase or
lease granted to a third party, which could or would (i) prevent Seller from
completing, or impair Seller’s ability to complete, the sale of the Properties
under this Agreement or the subsequent lease of the Properties pursuant to the
Lease Agreement, (ii) bind Purchaser subsequent to consummation of the
Transaction or, (iii) to Seller’s knowledge, prevent the provision of the
Guaranty by Guarantor.

 

(d)          No Violations. The authorization, execution, delivery and
performance of this Agreement and the other Transaction Documents will not
(i) violate any provisions of the articles of incorporation or other charter
documents of Seller and Lessee, (ii) result in a violation of or a conflict
with, or constitute a default (or an event which, with or without due notice or
lapse of time, or both, would constitute a default) under any other document,
instrument or agreement to which Seller, Lessee or Guarantor is a party or by
which Seller, Lessee, Guarantor, the Properties or any of the property of
Seller, Lessee or Guarantor is subject or bound, (iii) result in the creation or
imposition of any Lien, restriction, charge or limitation of any kind, upon
Seller, Lessee, Guarantor or the Properties, or (iv) violate any law, statute,
regulation, rule, ordinance, code, rule or order of any court or Governmental
Authority applicable to Seller or the Properties.

 

 6 

 

 

(e)          Compliance. Lessee’s use and occupation of the Properties, and the
condition thereof, comply with (i) all applicable statutes, regulations, rules,
ordinances, codes, licenses, permits, orders and approvals of each Governmental
Authority having jurisdiction over the Properties, including, without
limitation, all health, building, fire, safety and other codes, ordinances and
requirements, the Americans With Disabilities Act of 1990, and all policies or
rules of common law, in each case, as amended, and any judicial or
administrative interpretation thereof, including any judicial order, consent,
decree or judgment applicable to the Properties, Guarantor, Lessee, or Seller
(collectively, the “Legal Requirements”), (ii) all restrictions, covenants and
encumbrances of record with respect to the Properties, and (iii) all agreements,
contracts, insurance policies (including, without limitation, to the extent
necessary to prevent cancellation thereof and to insure full payment of any
claims made under such policies), agreements and conditions applicable to the
Properties or the ownership, operation, use or possession thereof. No Seller
Entity has received any notification that it or any Property is in violation of
any of the foregoing, including without limitation, the Legal Requirements.

 

(f)          Compliance with Anti-Terrorism, Embargo, Sanctions and Anti-Money
Laundering Laws. Without in any way limiting the provisions of Section 4.01(e),
Seller, and to the best of Seller’s knowledge, each of the Seller Entities is
not currently identified on the OFAC List, and is not a Person with whom a
citizen of the United States is prohibited from engaging in transactions by any
trade embargo, economic sanction, or other prohibition of United States law,
regulation, or executive order of the President of the United States.

 

(g)          Litigation. There is no legal, administrative, arbitration or other
proceeding, claim or action of any nature or investigation pending or involving
or, to the best of Seller’s knowledge, threatened against, Seller, the Seller
Entities or the Properties before any Governmental Authority, except as has been
disclosed in writing by Seller, which in any way adversely affects or may
adversely affect the Properties, the business performed and to be performed on
the Properties, the condition, worth or operations of any of the Seller
Entities, the ability of any of the Seller Entities to perform under this
Agreement or any other Transaction Documents, or which questions or challenges
any of the Seller’s Entities’ participation in the Transaction contemplated by
this Agreement or any other Transaction Document; and to the best of Seller’s
knowledge, there is no valid basis for any such legal, administrative,
arbitration or other proceeding, claim or action of any nature or investigation.

 

(h)          No Mechanics’ Liens. There are no outstanding accounts payable,
mechanics’ liens, or rights to claim a mechanics’ lien in favor of any
materialman, laborer, or any other Person in connection with labor or materials
furnished to or performed on any portion of the Properties, which will not have
been fully paid for on or before the Closing Date or, to Seller’s knowledge,
which might provide the basis for the filing of such liens against the
Properties or any portion thereof. No work has been performed or is in progress
nor have materials been supplied to the Properties or agreements entered into
for work to be performed or materials to be supplied to the Properties prior to
the date hereof, which will not have been fully paid for on or before the
Closing Date or which might provide the basis for the filing of such liens
against the Properties or any portion thereof. Seller shall be responsible for
any and all claims for mechanics’ liens and accounts payable that have arisen or
may subsequently arise due to agreements entered into for and/or any work
performed on, or materials supplied to the Properties prior and subsequent to
the Closing Date, and Seller shall and does hereby agree to defend, indemnify
and forever hold Purchaser and Purchaser’s designees harmless from and against
any and all such mechanics’ lien claims, accounts payable or other commitments
relating to the Properties.

 

 7 

 

  

(i)          Condition of Properties. The Properties, including the fixtures and
equipment located thereon, are of good workmanship and materials, fully equipped
and operational, in good condition and repair, free from structural defects,
clean, orderly and sanitary, safe, well-lit and well-maintained.

 

(j)          Intended Use; Zoning; Access. Lessee will use the Properties solely
for the operation of the Facilities and related ingress, egress and parking, and
for no other purposes; such use does not and will not violate any zoning or
other requirement of any Governmental Authority applicable to the Properties.
There are adequate rights of access to public roads and ways available to the
Properties to permit full utilization of the Properties for their intended
purpose and, to the best of Seller’s knowledge, all such public roads and ways
have been completed and dedicated to public use.

 

(k)          Condemnation; Wetlands. No condemnation or eminent domain
proceedings affecting the Properties have been commenced or, to the best of
Seller’s knowledge, are contemplated. The Properties and/or the real property
bordering the Properties are not designated by any Governmental Authority as
wetlands.

 

(l)          Licenses and Permits. Upon Closing Lessee will possess all required
licenses, permits and other authorizations, both governmental and private,
presently required by applicable provisions of law, including statutes,
regulations and existing judicial decisions, and by the property and contract
rights of third persons, necessary to permit the operation of the business in
the manner in which it presently is conducted at the Properties.

 

(m)          Intellectual Property. Upon Closing Lessee will possess and have
the right to use all intellectual property, licenses and other rights as are
material and necessary for the conduct of business at the Properties, and with
respect to which it is, and will be at Closing, in compliance, with no known
conflict with the valid rights of others.

 

(n)          Environmental. Without limiting in any way the representations and
warranties contained elsewhere in this Agreement, Seller hereby represents and
warrants to Purchaser as follows:

 

(i)          No Hazardous Materials or Regulated Substances, except in Permitted
Amounts, exist on, under or about the Properties or have been transported to or
from the Properties or used, generated, manufactured, stored or disposed of on,
under or about the Properties. The Properties are not in violation of any
Hazardous Materials Laws relating to industrial hygiene or the environmental
conditions on, under or about the Properties, including, without limitation,
air, soil and groundwater conditions, and this representation and warranty would
continue to be true and correct following disclosure to the applicable
Governmental Authorities of all relevant facts, conditions and circumstances, if
any, pertaining to the Properties.

 

 8 

 

 

(ii)         There is no past or present non-compliance with Hazardous Materials
Laws, or with permits issued pursuant thereto, in connection with the
Properties; all uses and operations on or of the Properties, whether by Seller
or any other Person, have been in compliance with all Hazardous Materials Laws
and environmental permits issued pursuant thereto; all USTs, if any, located on
or about the Properties are in full compliance with all Hazardous Materials
Laws, and as of the date hereof, Seller is in compliance with the requirements
of the UST Regulations with respect to those “petroleum underground storage
tanks” (as such term is defined under the UST Regulations) located at the
Properties. The Properties have been kept free and clear of all Environmental
Liens and Seller has not allowed any tenant or other user of the Properties
(including without limitation, Lessee) to do any act that increased the dangers
to human health or the environment, posed an unreasonable risk of harm to any
Person (whether on or off the Properties), impaired the value of the Properties
in any material respect, is contrary to any requirement of any insurer,
constituted a public or private nuisance, constituted waste, or violated any
covenant, condition, agreement or easement applicable to the Properties.

 

(iii)        No Seller Entity has received any written or oral notice or other
communication from any Person (including but not limited to a Governmental
Authority) relating to Hazardous Materials, Regulated Substances or USTs, or
remediation thereof, of possible liability of any Person (including without
limitation, Lessee) pursuant to any Hazardous Materials Law, other environmental
conditions in connection with the Properties, or any actual or potential
administrative or judicial proceedings in connection with any of the foregoing.

 

(o)          Information and Financial Statements. The financial statements and
other information concerning the Seller Entities delivered by or on behalf of
Seller to Purchaser are true, correct and complete in all respects, and no
adverse change has occurred with respect to the information provided in any such
financial statements, or other information provided to Purchaser since the date
such financial statements and other information were prepared or delivered to
Purchaser. Seller understands that Purchaser is relying upon such financial
statements and information and Seller represents that such reliance is
reasonable. All such financial statements were prepared in accordance with
generally accepted accounting principles consistently applied and accurately
reflect, as of the date of this Agreement and the Closing Date, the financial
condition of each individual or entity to which they pertain.

 

(p)          Solvency. There is no contemplated, pending or threatened
Insolvency Event or similar proceedings, whether voluntary or involuntary,
affecting the Seller Entities, or to Seller’s knowledge, any of their respective
members, partners, shareholders, or Affiliates.

 

(q)          Satisfaction of Conditions Precedent. From the Effective Date
through the Closing Date, Seller shall use its best efforts to satisfy all
conditions set forth in Section 5.01 of this Agreement on or prior to the
Closing Date.

 

(r)          No Bankruptcy Petition. Seller hereby agrees that it shall not
institute against, or join any other Person in instituting against, Purchaser,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding, or any other proceeding under any federal or state bankruptcy or
similar law. The provisions of this Section shall survive the Closing or
termination of this Agreement. Notwithstanding the foregoing, the provisions of
this Section shall in no way limit any other rights Seller may have with respect
to this Agreement, either at law or in equity.

 

 9 

 

  

(s)          State Bulk Sales Statutes. Seller represents and warrants to
Purchaser that no bulk sales statutes promulgated by any Governmental Authority
(“Bulk Sales Statutes”) apply as a result of the sale of any of the Properties.
Seller agrees to indemnify, defend and hold Purchaser harmless from and against
any and all losses, costs, damages, expenses (including without limitation,
court costs and reasonable attorney’s fees) and liabilities which may be
sustained or incurred by Purchaser, and/or any and all claims, demands, suits,
proceedings and causes of action which may be brought or raised against Seller
or Purchaser, as a result of or arising from (i) any claim that Purchaser has
any liability or obligations under the Bulk Sales Statutes (including without
limitation, any tax obligations or liabilities (or interest or penalties
connected therewith) of Seller) by reason of the transactions provided for
herein; or (ii) the failure of Purchaser to withhold any of Seller’s unpaid tax
obligations, liabilities, interest or penalties thereon from the Purchase Price
or otherwise as required under any Bulk Sales Statutes; provided, however, that
Seller shall not be liable for and have no indemnification obligations to
Purchaser hereunder for any taxes that are the obligation of Lessee pursuant to
the Lease Agreement.

 

(t)          First Priority Lien. Upon Closing, Purchaser will have a first
priority lien position upon all of the Personalty (as such term is defined in
the Lease) owned by Lessee and located upon the Properties (the “FFE Lien”).

 

All representations and warranties of Seller made in this Agreement shall be
true as of the date of this Agreement, shall be deemed to have been made again
at and as of the Closing Date, shall be true at and as of the Closing Date, and,
together with the covenants made by Seller herein, shall survive Closing.

 

Section 4.02. Purchaser. Purchaser represents and warrants to, and covenants
with, Seller as follows:

 

(a)          Organization and Authority. Purchaser is duly organized, validly
existing and in good standing under the laws of its state of formation.
Purchaser has all requisite power and authority to execute, deliver and perform
its obligations under this Agreement and all of the other Transaction Documents
to which it is a party and to carry out the Transaction. The Person who has
executed this Agreement on behalf of Purchaser has been duly authorized to do
so.

 

(b)          Enforceability of Documents. Upon execution by Purchaser, this
Agreement and the other Transaction Documents to which it is a party, shall
constitute the legal, valid and binding obligations of Purchaser, enforceable
against Purchaser in accordance with their respective terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium, or other similar laws relating to or affecting the
rights of creditors generally, or by general equitable principles.

 

(c)          Litigation. There are no actions or proceedings pending against or
involving Purchaser before any Governmental Authority which in any way adversely
affect or may adversely affect Purchaser or Purchaser’s ability to perform under
this Agreement and the other Transaction Documents to which it is a party.

 

 10 

 

  

(d)          Satisfaction of Conditions Precedent. From the Effective Date
through the Closing Date, Purchaser agrees to use its best efforts to satisfy
all conditions set forth in Section 5.02 of this Agreement on or prior to the
Closing Date.

 

All representations and warranties of Purchaser made in this Agreement shall be
true as of the date of this Agreement, shall be deemed to have been made again
at and as of the Closing Date, shall be true at and as of the Closing Date, and,
together with the covenants made by Purchaser herein, shall survive Closing.

 

ARTICLE V

 

CONDITIONS PRECEDENT TO CLOSING

 

Section 5.01. Purchaser’s Conditions to Closing. Purchaser shall not be
obligated to close and fund the Transaction until the fulfillment (or written
waiver by Purchaser) of all of the following conditions:

 

(a)          Seller, Lessee, Guarantor and Current Owner as appropriate, shall
have delivered to Purchaser or the Title Company, as applicable, the following
items:

 

(i)          The Deeds;

 

(ii)         Such documents evidencing the legal status and good standing of
Seller, Lessee and Current Owner that may be required by Purchaser and/or the
Title Company for issuance of the Title Policies, including, without limitation,
certificates of good standing;

 

(iii)        Fully executed originals of (A) the Lease Agreement, together with
fully executed originals of a memoranda thereof for each of the
Properties(collectively, the “Memoranda of Lease”), and (B) an Assignment of
Warranties in the form of Exhibit D attached hereto, or if not assignable,
evidence satisfactory to Purchaser that it will receive coverage or protection
acceptable for the matters covered by such warranties, in either case, to the
extent required by Purchaser (the “Assignment of Warranties”), and (C) all of
the other Transaction Documents, including without limitation, the Guaranty;

 

(iv)        Certificates evidencing the insurance coverage, limits and policies
to be carried by Lessee under and pursuant to the terms of the Lease Agreement,
on the forms and containing the information required by Purchaser, as landlord
(“Lease Proof of Insurance”);

 

(v)         A certificate of an officer, manager or general partner, as
applicable, of each of Seller and Lessee, together with copies of each entity’s
(1) articles of organization or certificate of formation, as applicable, amended
to date; (2) operating agreement, bylaws or partnership agreement, as
applicable, amended to date; (3) resolutions authorizing the Transaction and the
execution of this Agreement and the other Transaction Documents, and identifying
the Person(s) authorized to execute this Agreement and the other Transaction
Documents; and (4) original certificates of good standing or similar documents
from the states in which each entity was organized or formed, and original
certificates of qualification or similar documents from the states where the
Properties are located;

 

 11 

 

  

(vi)        A duly executed affidavit from each of Seller and Current Owner
stating that such party is not a “foreign person” as defined in the Federal
Foreign Investment in Real Property Tax Act of 1980 and 1984 Tax Reform Act, in
the form attached hereto as Exhibit C (“Non-Foreign Seller Certificate”);

 

(vii)       Closing settlement statements approved by Seller and Purchaser to
reflect the credits, prorations, and adjustments contemplated by or specifically
provided for in this Agreement;

 

(viii)      To the extent not previously provided, the most recent financial
statements available for Seller, Lessee and Guarantor; and

 

(ix)         All documents required to be delivered by this Agreement and the
other Transaction Documents and as may otherwise be required in order to fully
and legally close this Transaction.

 

(b)          Purchaser shall have received the Title Commitments and the Title
Company’s irrevocable commitment to insure title by means of the Title Policies
which shall (i) show good and marketable title in Seller, (ii) commit to insure
Purchaser’s fee simple ownership in the Properties subject only to Permitted
Encumbrances, and (iii) contain such endorsements as Purchaser may require.

 

(c)          Purchaser’s lender, if any, shall have received from the Title
Company an irrevocable commitment to issue ALTA lender’s policies of title
insurance which shall (i)  insure title by means of an ALTA extended coverage
policy of title insurance, (ii)  show good and marketable title in Seller,
(iii) commit to insure lender’s interest in the Properties subject only to
Permitted Encumbrances, and (iv) contain such endorsements as such lender may
require.

 

(d)          Purchaser shall have determined, in its sole discretion, that no
conditions exist regarding the financial markets that could reasonably be
expected to cause the rents and any other payments due under the Lease Agreement
to become delinquent or to adversely affect the value or marketability of the
Transaction or the Properties. There shall have been no adverse change in the
financial condition of Seller, Lessee, Guarantor or the Properties from the
Effective Date.

 

(e)          All (i) representations and warranties of Seller set forth herein
shall have been true and correct in all respects when made, and (ii) all
covenants, agreements and conditions required to be performed or complied with
by Seller prior to or at the time of Closing in connection with the Transaction
shall have been duly performed or complied with by Seller prior to or at such
time or waived in writing by Purchaser.

 

(f)          No event shall have occurred or condition shall exist which would,
upon the Closing Date, or, upon the giving of notice and/or passage of time,
constitute a breach or default hereunder or under any other Transaction
Document, or any other agreements between or among Purchaser, Seller, Lessee or
Guarantor.

 

 12 

 

  

(g)          Seller and Lessee shall have caused all leases and, unless
otherwise agreed to in writing by Purchaser, all subleases of any or all of the
Properties and any other documents affecting the Properties existing at Closing,
at Purchaser’s sole option, to be cancelled as of the Closing Date or
subordinated to the Lease Agreement pursuant to subordination agreements in form
and substance satisfactory to Purchaser.

 

(h)          Purchaser shall have received evidence in all respects satisfactory
to Purchaser that upon Closing and execution and delivery of the Lease
Agreement, Purchaser, as lessor, will have the first priority FFE lien on the
Personalty.

 

(i)          Purchaser shall have received a copy of the final agreement and all
related documentation, which shall be in all respects satisfactory to Purchaser,
memorializing the proposed holdback by Seller (as purchaser under the Existing
Purchase Agreement) of up to $312,000 of the purchase price due under the
Existing Purchase Agreement (the “Seller Holdback”). In no event shall Purchaser
or its Affiliates be party to the Seller Holdback, nor shall the Properties or
the Personalty be subject to or encumbered by the Seller Holdback in any way
(and in no event shall Current Owner be entitied to recover against the
Properties, the Personalty or Purchaser and its Affiliates upon an event of
default by Seller under the Seller Holdback).

 

(j)          The transaction contemplated by the Existing Purchase Agreement
shall have closed or shall close simultaneously with the Transaction
contemplated herein.

 

Upon the fulfillment or Purchaser’s written waiver of all of the above
conditions, Purchaser shall deposit funds necessary to close this Transaction
with the Title Company and this Transaction shall close in accordance with the
terms and conditions of this Agreement. Unless otherwise agreed, all of the
documents to be delivered at Closing shall be dated as of the Closing Date.

 

Section 5.02. Seller’s Conditions Precedent to Closing. Seller shall not be
obligated to close the Transaction until the fulfillment (or written waiver by
Seller) of all of the following conditions:

 

(a)          Purchaser shall have delivered to the Title Company the Purchase
Price, as adjusted pursuant to the requirements of this Agreement;

 

(b)          Purchaser shall have caused to be executed and delivered to the
appropriate Persons fully executed originals of all Transaction Documents,
including without limitation, the Lease Agreement, together with the Memoranda
of Lease and the Assignment of Warranties;

 

(c)          Purchaser shall have delivered to the Title Company Closing
settlement statements approved by Seller and Purchaser to reflect the credits,
prorations, and adjustments contemplated by or specifically provided for in this
Agreement;

 

(d)          Purchaser shall have delivered to Seller and/or the Title Company
such other further documents as may reasonably be required in order to fully and
legally close this Transaction;

 

 13 

 

  

(e)          All covenants, agreements and conditions required to be performed
or complied with by Purchaser prior to or at the time of Closing in connection
with the Transaction shall have been duly performed or complied with by
Purchaser or waived in writing by Seller prior to or at such time; and

 

(f)          The transaction contemplated by the Existing Purchase Agreement
shall have closed or shall close simultaneously with the Transaction
contemplated herein.

 

ARTICLE VI

 

DEFAULTS; REMEDIES

 

Section 6.01. Default. Each of the following shall be deemed an event of default
(each, an “Event of Default”):

 

(a)          If any representation or warranty of Seller or Purchaser set forth
in this Agreement or any other Transaction Document is false in any material
respect or if Seller renders any false statement;

 

(b)          If Seller or Purchaser fails to perform any of its obligations
under this Agreement; or

 

(c)          If any Insolvency Event shall occur with respect to any Seller
Entity or Purchaser.

 

Section 6.02. Remedies. In the event of any Event of Default, the non-defaulting
party shall be entitled to exercise, at its option and as its sole and exclusive
remedy, one of the following remedies:

 

(a)          The non-defaulting party may terminate this Agreement by giving
written notice to the defaulting party and recover from the defaulting party all
reasonable and verified out-of-pocket costs and expenses incurred by the
non-defaulting party hereunder (including without limitation, the Transaction
Costs, any other due diligence costs, and the reasonable and verified fees and
costs of legal counsel or other advisors), in which case neither party shall
have any further obligation or liability, except for the obligations set forth
herein (including without limitation, those set forth in this Section 6.02(a)
and in Sections 1.05, 7.05 and 7.06 hereof), the provisions which are expressly
stated to survive termination of this Agreement; or

 

(b)          The non-defaulting party may waive the Event of Default and proceed
with the Closing.

 

ARTICLE VII

 

MISCELLANEOUS

 

Section 7.01. Transaction Characterization.

 

(a)          The parties intend that (i) all components of the Transaction shall
be considered a single integrated transaction and shall not be severable; and
(ii) the Lease Agreement shall constitute a single master lease of all, but not
less than all, of the Properties, the Lease Agreement shall be a unitary,
unseverable instrument pertaining to all, but not less than all, of the
Properties, and none of the Lease Agreement or Lessee’s rights, obligations or
duties may be divided or otherwise allocated by Lessee among the Properties.

 

 14 

 

  

(b)          The parties intend that the conveyance of the Properties to
Purchaser be an absolute conveyance in effect as well as form, and that the
instruments of conveyance to be delivered at Closing shall not serve or operate
as a mortgage, equitable mortgage, deed of trust, security agreement, trust
conveyance or financing or trust arrangement of any kind, nor as a preference or
fraudulent conveyance against any creditors of Seller. After the execution and
delivery of the Deeds, Seller will have no legal or equitable interest or any
other claim or interest in the Properties, other than the interest, if any, set
forth in the Lease Agreement. The parties also intend for the Lease Agreement to
be a true lease and not a transaction creating a financing lease, capital lease,
equitable mortgage, mortgage, deed of trust, security interest or other
financing arrangement, and the economic realities of the Lease Agreement are
those of a true lease. Notwithstanding the existence of the Lease Agreement,
neither party shall contest the validity, enforceability or characterization of
the sale and purchase of the Properties by Purchaser pursuant to this Agreement
as an absolute conveyance, and both parties shall support the intent expressed
herein that the purchase of the Properties by Purchaser pursuant to this
Agreement provides for an absolute conveyance and does not create a joint
venture, partnership, equitable mortgage, trust, financing device or
arrangement, security interest or the like, if, and to the extent that, any
challenge occurs.

 

(c)          Each of the parties hereto agrees that it will not, nor will it
permit any Affiliate to, at any time, take any action or fail to take any action
with respect to the preparation or filing of any statement or disclosure to
Governmental Authority, including without limitation, any income tax return
(including an amended income tax return), to the extent that such action or such
failure to take action would be inconsistent with the intention of the parties
expressed in this Section 7.01.

 

Section 7.02. Risk of Loss.

 

(a)          Condemnation. If, prior to Closing, action is initiated to take any
of the Properties, or any portion thereof, by eminent domain proceedings or by
deed in lieu thereof, Purchaser may elect at or prior to Closing, to
(i) terminate this Agreement, in which event Seller and Purchaser shall be
relieved and discharged of any further liability or obligation under this
Agreement, except as otherwise expressly set forth herein (including without
limitation, the payment of Transaction Costs and the other expenses as set forth
in Section 1.05), or (ii) proceed to close, in which event all of Seller’s
assignable right, title and interest in and to the award of the condemning
authority shall be assigned to Purchaser at the Closing and there shall be no
reduction in the Purchase Price.

 

 15 

 

 

(b)          Casualty. Seller assumes all risks and liability for damage to or
injury occurring to the Properties by fire, storm, accident, or any other
casualty or cause until the Closing has been consummated. If the Properties, or
any part thereof, suffers any damage prior to the Closing from fire or other
casualty, which Seller, at its sole option, does not elect to fully repair,
Purchaser may elect at or prior to Closing, to (i) terminate this Agreement, in
which event Seller and Purchaser shall be relieved and discharged of any further
liability or obligation under this Agreement, except as otherwise expressly set
forth herein (including without limitation, the payment of Transaction Costs and
the other expenses as set forth in Section 1.05), or (ii) consummate the
Closing, in which event all of Seller’s right, title and interest in and to the
proceeds of any insurance covering such damage (less an amount equal to any
expense and costs reasonably incurred by Seller to repair or restore the
Properties, which shall be payable to Seller upon Seller’s delivery to Purchaser
of satisfactory evidence thereof), to the extent that the amount of such
insurance does not exceed the Purchase Price, shall be assigned to Purchaser at
Closing, and Purchaser shall be entitled to a credit in the amount of Seller’s
deductible at Closing.

 

(c)          Maintenance of Properties and Insurance. From the Effective Date
until Closing, Seller shall continue to maintain the Properties or cause the
Properties to be maintained in good condition and repair, and shall continue to
maintain or cause to be maintained all insurance for the Properties in the same
or greater amounts, with the same or greater coverage, and subject to the same
or lower deductibles as in existence as of the Effective Date.

 

Section 7.03. Notices. All notices, demands, designations, certificates,
requests, offers, consents, approvals, appointments and other instruments given
pursuant to this Agreement (collectively called “Notices”) shall be in writing
and given by (a) hand delivery, (b) express overnight delivery service,
(c) email or facsimile transmission, or (d) certified or registered mail, return
receipt requested, and shall be deemed to have been delivered upon (i) receipt,
if hand delivered, (ii) the next Business Day, if delivered by a reputable
express overnight delivery service, (iii) receipt of confirmation of email, if
delivered by email, or (iv) the third Business Day following the day of deposit
of such notice with the United States Postal Service, if sent by certified or
registered mail, return receipt requested. Notices shall be provided to the
parties and addresses (or facsimile numbers, as applicable) specified below:

 

If to Seller:

ARC Group Inc.

6327-4 Argyle Forest Blvd.

Jacksonville, FL 32244

Attention: Seenu Kasturi

Email: arc@arcgrpinc.com

 

If to Purchaser:

STORE Capital Acquisitions, LLC

8377 E. Hartford Dr., Suite 100

Scottsdale, AZ 85255

Attention: Asset Management

Email: customerservice@storecapital.com

 

With a copy to:

Kutak Rock LLP

1801 California Street, Suite 3000

Denver, CO 80202

Attention: Whitney A. Kopicky, Esq.

Email: whitney.kopicky@kutakrock.com

 

or to such other address or such other Person as either party may from time to
time hereafter specify to the other party in a notice delivered in the manner
provided above. Whenever in this Agreement the giving of Notice is required, the
giving thereof may be waived in writing at any time by the Person or Persons
entitled to receive such Notice.

 

 16 

 

  

A copy of any Notice delivered pursuant to this Section shall also
contemporaneously be delivered in the manner herein specified to any mortgagee
or assignee of Purchaser’s interest which shall have duly notified Seller in
writing of its name and address.

 

Section 7.04. Assignment. Purchaser may assign its rights under this Agreement
in whole or in part at any time. Upon any unconditional assignment of
Purchaser’s entire right and interest hereunder, Purchaser shall automatically
be relieved, from and after the date of such assignment, of liability for the
performance of any obligation of Purchaser contained herein. Seller shall not,
without the prior written consent of Purchaser, which consent may be withheld in
Purchaser’s sole discretion, sell, assign, transfer, mortgage, convey, encumber
or grant any easements or other rights or interests of any kind in the
Properties, any of Seller’s rights under this Agreement or any interest in
Seller, whether voluntarily, involuntarily or by operation of law or otherwise,
including, without limitation, by merger, consolidation, dissolution or
otherwise.

 

Section 7.05. Indemnity.

 

(a)          Seller shall indemnify, defend and hold harmless Purchaser and its
Affiliates, and their respective officers, directors, shareholders, managers,
members, employees, representatives, successors and assigns, as applicable
(collectively, the “Indemnified Parties”), from and against any and all Losses
of any nature arising from or connected with (a) breach of any of the
representations, warranties, covenants, agreements or obligations of Seller set
forth in this Agreement, and (b) the ownership and operation of the Properties
prior to the Closing Date. Without limiting the generality of the foregoing,
such indemnity shall include, without limitation, any Losses incurred with
respect to any engineering, governmental inspection and attorneys’ fees and
expenses that the Indemnified Parties may incur by reason of any environmental
condition and/or any representation or warranty set forth in Section 4.01(n)
being false, or by reason of any investigation or claim of any Governmental
Authority in connection therewith. The obligations under this Section 7.05(a)
shall survive Closing.

 

(b)          Purchaser shall indemnify, defend and hold harmless Seller from and
against any and all Losses of any nature arising from or connected with (a)
breach of any of the representations, warranties, covenants, agreements or
obligations of Purchaser set forth in this Agreement, and (b) the Inspections.
The obligations under this Section 7.05(b) shall survive Closing.

 

Section 7.06. Brokerage Commission. Each of the parties represents and warrants
to the other that neither party has dealt with, negotiated through or
communicated with any broker in connection with this Transaction. Each party
shall indemnify, defend and hold harmless the other party from and against any
and all claims, loss, costs and expenses, including reasonable attorneys’ fees,
resulting from any claims that may be made against the indemnified party by any
broker claiming a commission or fee by, through or under such indemnifying
party. The parties’ respective obligations under this Section 7.06 shall survive
Closing or termination of this Agreement.

 

 17 

 

 

Section 7.07. Reporting Requirements. The parties agree to comply with any and
all reporting requirements applicable to the Transaction which are set forth in
any law, statute, ordinance, rule, regulation, order or determination of any
Governmental Authority, and further agree upon request, to furnish the other
party with evidence of such compliance.

 

Section 7.08. Disclosures. Except as expressly set forth in Sections 7.07 and
7.16 and this Section 7.08 and as required by law or judicial action, prior to
Closing neither Seller nor Purchaser will make any public disclosure of this
Agreement or the other Transaction Documents, the Transaction or the provisions
of the Transaction Documents without the prior consent of the other party
hereto. The parties further agree that, notwithstanding any provision contained
in this Agreement, any party (and each employee, representative or other agent
of any party) may disclose to any and all Persons, without limitation of any
kind, any matter required under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended.

 

Section 7.09. Time is of the Essence. The parties hereto expressly agree that
time is of the essence with respect to this Agreement.

 

Section 7.10. Non-Business Days. If the Closing Date or the date for delivery of
a notice or performance of some other obligation of a party falls on a Saturday,
Sunday or legal holiday in the state in which any Property is located, then the
Closing Date or such notice or performance shall be postponed until the next
Business Day.

 

Section 7.11. Waiver and Amendment. No provision of this Agreement shall be
deemed waived or amended except by a written instrument unambiguously setting
forth the matter waived or amended and signed by the party against which
enforcement of such waiver or amendment is sought. Waiver of any matter shall
not be deemed a waiver of the same or any other matter on any future occasion.

 

Section 7.12. Limitation on Liability. Notwithstanding anything to the contrary
provided in this Agreement, it is specifically understood and agreed, such
agreement being a primary consideration for the execution of this Agreement and
the Lease Agreement, that (a) there shall be absolutely no personal liability on
the part of any director, officer, manager, member, stockholder, employee or
agent of Purchaser or Seller with respect to any of the terms, covenants and
conditions of this Agreement, (b) Seller and Purchaser each waives all claims,
demands and causes of action against the other party’s directors, officers,
managers, members, stockholder, employees and agents in the event of any breach
by Purchaser or Seller, respectively, of any of the terms, covenants and
conditions of this Agreement , and (c) Seller and Purchaser shall each look
solely to the assets of the other party for the satisfaction of each and every
remedy in the event of any breach of any of the terms, covenants and conditions
of this Agreement, such exculpation of liability to be absolute and without any
exception whatsoever.

 

Section 7.13. Headings; Internal References. The headings of the various
sections and exhibits of this Agreement have been inserted for reference only
and shall not to any extent have the effect of modifying the express terms and
provisions of this Agreement. Unless stated to the contrary, any references to
any section, subsection, exhibit and the like contained herein are to the
respective section, subsection, exhibit and the like of this Agreement.

 

 18 

 

 

Section 7.14. Construction Generally. This is an agreement between parties who
are experienced in sophisticated and complex matters similar to the Transaction
and the other Transaction Documents, is entered into by both parties in reliance
upon the economic and legal bargains contained herein and therein, and shall be
interpreted and construed in a fair and impartial manner without regard to such
factors as the party which prepared the instrument, the relative bargaining
powers of the parties or the domicile of any party. Seller and Purchaser were
each represented by legal counsel competent in advising them of their
obligations and liabilities hereunder.

 

Section 7.15. Further Assurances. Each of the parties agrees, whenever and as
often as reasonably requested so to do by the other party or the Title Company,
to execute, acknowledge, and deliver, or cause to be executed, acknowledged, or
delivered, any and all such further conveyances, assignments, confirmations,
satisfactions, releases, instruments, or other documents as may be necessary,
expedient or proper, in order to complete any and all conveyances, transfers,
sales and assignments herein provided and to do any and all other acts and to
execute, acknowledge and deliver any and all documents as so requested in order
to carry out the intent and purpose of this Agreement.

 

Section 7.16. Securitizations and Other Transactions. As a material inducement
to Purchaser’s willingness to complete the transactions contemplated by this
Agreement and the other Transaction Documents, Seller hereby acknowledges and
agrees that Purchaser may, from time to time and at any time, (a) advertise,
issue press releases, send direct mail or otherwise disclose information
regarding the Transaction for marketing purposes; and (b) engage in all or any
combination of the following, or enter into agreements in connection with any of
the following or in accordance with requirements that may be imposed by
applicable securities, tax or other laws: (i) the sale, assignment, grant,
conveyance, transfer, financing, re-financing, purchase or re-acquisition of any
Property, the Lease Agreement or any other Transaction Document, Purchaser’s
right, title and interest in any Property, the Lease Agreement or any other
Transaction Document, the servicing rights with respect to any of the foregoing,
or participations in any of the foregoing, or (ii) a securitization and related
transactions. Seller agrees to use all reasonable efforts and to cooperate fully
with Purchaser with respect to all reasonable requests of Purchaser relating to
the foregoing, which includes without limitation, with respect to the activities
described in subsection (b), providing financial information, financial and
other data, and other information and materials which would customarily be
required by a purchaser, transferee, assignee, servicer, participant, investor
or rating agency involved with respect to any of the foregoing. The provisions
of this Section 7.16 shall survive the Closing.

 

Section 7.17. Attorneys’ Fees. In the event of any controversy, claim, dispute
or proceeding between the parties concerning this Agreement, the prevailing
party shall be entitled to recover all of its reasonable attorneys’ fees and
other costs in addition to any other relief to which it may be entitled.

 

Section 7.18. Entire Agreement. This Agreement and all other Transaction
Documents, and all other certificates, instruments or agreements to be delivered
hereunder and thereunder constitute the entire agreement between the parties
with respect to the subject matter hereof, and there are no other
representations, warranties or agreements, written or oral, between Seller and
Purchaser with respect to the subject matter of this Agreement. Notwithstanding
anything in this Agreement to the contrary, upon the execution and delivery of
this Agreement by Seller and Purchaser, (a) this Agreement shall supersede any
previous discussions, letters of intent, agreements and/or term or commitment
letters relating to the Transaction, including without limitation, the Letter of
Intent and any and all agreements related to confidentiality, exclusivity,
non-competition, non-solicitation of employees, non-solicitation or pursuit of
any business opportunity represented by the Transaction, or any other term or
condition which restricts any business activity of Purchaser or its affiliates,
(b) the terms and conditions of this Agreement shall control notwithstanding
that such terms are inconsistent with or vary from those set forth in any of the
foregoing agreements, and (c) this Agreement may only be amended by a written
agreement executed by Purchaser and Seller. The provisions of this Section shall
survive the Closing.

 

 19 

 

  

Section 7.19. Forum Selection; Jurisdiction; Venue. For purposes of any action
or proceeding arising out of this Agreement, the parties hereto expressly submit
to the jurisdiction of all federal and state courts located in the State of
Arizona. Seller consents that it may be served with any process or paper by
registered mail or by personal service within or without the State of Arizona in
accordance with applicable law. Furthermore, Seller waives and agrees not to
assert in any such action, suit or proceeding that it is not personally subject
to the jurisdiction of such courts, that the action, suit or proceeding is
brought in an inconvenient forum or that venue of the action, suit or proceeding
is improper. Nothing contained in this Section shall limit or restrict the right
of Purchaser to commence any proceeding in the federal or state courts located
in the state or states in which the Properties are located to the extent
Purchaser deems such proceeding necessary or advisable to exercise remedies
available under this Agreement.

 

Section 7.20. Separability; Binding Effect; Governing Law. Each provision hereof
shall be separate and independent, and the breach of any provision by Purchaser
shall not discharge or relieve Seller from any of its obligations hereunder.
Each provision hereof shall be valid and shall be enforceable to the extent not
prohibited by law. If any provision hereof or the application thereof to any
Person or circumstance shall to any extent be invalid or unenforceable, the
remaining provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it is invalid or unenforceable, shall
not be affected thereby. Subject to the provisions of Section 7.04, all
provisions contained in this Agreement shall be binding upon, inure to the
benefit of and be enforceable by the successors and assigns of each party
hereto, including, without limitation, any United States trustee, any
debtor-in-possession or any trustee appointed from a private panel, in each case
to the same extent as if each successor and assign were named as a party hereto.
This Agreement shall be governed by, and construed with, the laws of the
applicable state or states in which the Properties are located, without giving
effect to any state’s conflict of laws principles.

 

Section 7.21. Survival. Except for the conditions of Closing set forth in
Article V, which shall be satisfied or waived in writing as of the Closing Date,
all representations, warranties, agreements, obligations and indemnities of
Seller and Purchaser set forth in this Agreement shall survive the Closing.

 

Section 7.22. Waiver of Jury Trial and Certain Damages. THE PARTIES HERETO SHALL
AND THEY HEREBY DO INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO A TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO
AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS AGREEMENT AND/OR ANY CLAIM OR INJURY OR DAMAGE RELATED
THERETO. SELLER FURTHER WAIVES THE RIGHT IT MAY HAVE TO SEEK PUNITIVE,
CONSEQUENTIAL, SPECIAL AND INDIRECT DAMAGES FROM PURCHASER IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM WITH RESPECT TO ANY MATTER ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT AND/OR ANY DOCUMENT CONTEMPLATED HEREIN OR
RELATED HERETO.

 

 20 

 

  

Section 7.23. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all such
counterparts shall be deemed to constitute one and the same instrument.

 

[Remainder of page intentionally left blank; signature page(s) to follow]

 

 21 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first set forth above.

 

  PURCHASER:       STORE CAPITAL ACQUISITIONS, LLC, a Delaware limited liability
company         By: /s/ Michael T. Bennett         Name: Michael T. Bennett    
    Title: EVP General Counsel

 

 

 

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first set forth above.

 

  SELLER:       ARC GROUP INC., a Nevada corporation         By: /s/ Seenu
Kasturi         Name:  Seenu Kasturi         Title: CFO

 

Exhibits:

 

A:Defined Terms

B:Legal Descriptions / Property Addresses

C:Non-Foreign Seller Certificate

D:Assignment of Warranties

 

 

 

 

EXHIBIT A

 

DEFINED TERMS

 

The following terms shall have the following meanings for all purposes of this
Agreement:

 

“Additional Title Objection” has the meaning set forth in Section 2.01(d)(ii).

 

“Affiliate” or any derivation thereof, means any Person which directly or
indirectly controls, is under common control with, or is controlled by any other
Person. For purposes of this definition, “controls”, “under common control with”
and “controlled by” means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of such Person,
whether through ownership of voting securities or otherwise.

 

“Assignment of Warranties” has the meaning set forth in Section 5.01(a)(iii).

 

“Bulk Sales Statutes” has the meaning set forth in Section 4.01(s).

 

“Business Day” means a day on which banks located in Scottsdale, Arizona are not
required or authorized to remain closed.

 

“Closing” shall have the meaning set forth in Section 3.01.

 

“Closing Date” shall have the meaning set forth in Section 3.01.

 

“Closing Deadline” means five (5) Business Days following the expiration of the
Inspection Period or any other date mutually agreed upon by Seller and
Purchaser.

 

“Current Owner” has the meaning set forth in Section 1.01.

 

“Deeds” means those certain general warranty deeds whereby Seller conveys to
Purchaser all of Seller’s right, title and interest in and to the Properties,
free and clear of all Liens, restrictions, encroachments and easements, except
the Permitted Encumbrances.

 

“Effective Date” has the meaning set forth in the introductory paragraph of this
Agreement.

 

“Environmental Liens” means all liens and other encumbrances imposed pursuant to
any Hazardous Materials Law.

 

“Environmental Report” has the meaning set forth in Section 2.04.

 

“Event of Default” has the meaning set forth in Section 6.01.

 

“Existing Purchase Agreement” means that certain asset purchase agreement dated
as of August 3, 2018, by and among Seller, as purchaser, and CSA, Inc., a West
Virginia corporation, CSA Investments, LLC, a West Virginia limited liability
company, CSA of Teays Valley, Inc., a West Virginia corporation, CSA, Inc. of
Ashland, a Kentucky corporation, and Current Owner, collectively, as seller, as
the same may be amended, from time to time.

 

 A-1 

 

  

“Facilities” means a Fat Patty’s restaurant, and uses incidental thereto.

 

“FFE Lien” has the meaning set forth in Section 4.01(t).

 

“Governmental Authority” means the United States of America, any state or other
political subdivision thereof, any other entity exercising executive, judicial,
regulatory or administrative functions of or pertaining to government and any
corporation or other entity owned or controlled (through stock or capital
ownership or otherwise) by any of the foregoing.

 

“Guarantor” means Kasturi, or any additional or replacement guarantor(s)
approved by Purchaser (as landlord) in its sole and absolute discretion.

 

“Guaranty” means an unconditional guaranty of payment and performance in form
and substance acceptable to Lessor and Guarantor.

 

“Hazardous Materials” includes: (a) oil, petroleum products, flammable
substances, explosives, radioactive materials, hazardous wastes or substances,
toxic wastes or substances or any other materials, contaminants or pollutants,
the presence of which causes the Properties to be in violation of any local,
state or federal law or regulation, (including without limitation, any Hazardous
Materials Law), or are defined as or included in the definition of “hazardous
substances”, “hazardous wastes”, “hazardous materials”, “toxic substances”,
“contaminants”, “pollutants”, or words of similar import under any applicable
local, state or federal law or under the regulations adopted, orders issued, or
publications promulgated pursuant thereto, including, but not limited to:
(i) the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. §9601, et seq.; (ii) the Hazardous Materials
Transportation Act, as amended, 49 U.S.C. §1801, et seq.; (iii) the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. §6901, et seq.; and
(iv) regulations adopted and publications promulgated pursuant to the aforesaid
laws; (b) asbestos in any form which is friable, urea formaldehyde foam
insulation, transformers or other equipment which contain dielectric fluid
containing levels of polychlorinated biphenyls in excess of fifty (50) parts per
million; (c) underground storage tanks; and (d) any other chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
Governmental Authority.

 

“Hazardous Materials Laws” includes any and all federal, state and local laws,
rules, regulations, statutes, and requirements pertaining or relating to the
environmental condition of the Properties or to Hazardous Materials.

 

“Indemnified Parties” has the meaning set forth in Section 7.05.

 

“Insolvency Event” means (a) a Person’s (i) failure to generally pay its debts
as such debts become due; (ii) admitting in writing its inability to pay its
debts generally; or (iii) making a general assignment for the benefit of
creditors; (b) any proceeding being instituted by or against any Person
(i) seeking to adjudicate it a bankrupt or insolvent; (ii) seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy, insolvency,
or reorganization or relief of debtors; or (iii) seeking the entry of an order
for relief or the appointment of a receiver, trustee, or other similar official
for it or for any substantial part of its property, and in the case of any such
proceeding instituted against any such Person, either such proceeding shall
remain undismissed for a period of 120 days or any of the actions sought in such
proceeding shall occur; or (c) any Person taking any corporate or other formal
action to authorize any of the actions set forth above in this definition.

 

 A-2 

 

  

“Inspection Period” has the meaning set forth in Section 2.07.

 

“Inspections” has the meaning set forth in Section 2.07.

 

“Kasturi” means Seenu G. Kasturi, an individual.

 

“Lease Agreement” has the meaning set forth in Section 1.03.

 

“Lease Proof of Insurance” has the meaning set forth in Section 5.01(a)(iv).

 

“Legal Requirements” has the meaning set forth in Section 4.01(e).

 

“Lessee” means ARC Group, Inc., a Nevada corporation.

 

“Letter of Intent” means that certain Letter of Intent dated June 11, 2018
between STORE Capital Corporation, on behalf of Purchaser, and Seller with
respect to the Transaction, and any amendments or supplements thereto.

 

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever (including without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable law of any jurisdiction).

 

“Losses” means any and all claims, lawsuits, suits, liabilities (including,
without limitation, strict liabilities), actions, proceedings, obligations,
debts, damages, losses, costs, expenses, diminutions in value, fines, penalties,
interest, charges, fees, expenses, judgments, decrees, awards, amounts paid in
settlement and damages of whatever kind or nature (including, without
limitation, attorneys’ fees, court costs and costs incurred in the
investigation, defense and settlement of claims).

 

“Memoranda of Lease” has the meaning set forth in Section 5.01(a)(iii).

 

“Non-Foreign Seller Certificate” has the meaning set forth in
Section 5.01(a)(vi).

 

“Notices” has the meaning set forth in Section 7.03.

 

“OFAC List” means the list of specially designated nationals and blocked Persons
subject to financial sanctions that is maintained by the U.S. Treasury
Department, Office of Foreign Assets Control and any other similar list
maintained by the U.S. Treasury Department, Office of Foreign Assets Control
pursuant to any Legal Requirements, including, without limitation, trade
embargo, economic sanctions, or other prohibitions imposed by Executive Order of
the President of the United States. The OFAC List currently is accessible
through the internet website www.treas.gov/ofac/t11sdn.pdf.

 

 A-3 

 

  

“Permitted Amounts” means, with respect to any given level of Hazardous
Materials or Regulated Substances, that level or quantity of Hazardous Materials
or Regulated Substances in any form or combination of forms, the use, storage or
release of which does not constitute a violation of or require regulation under
any Hazardous Materials Laws and is customarily employed in the ordinary course
of business of, or associated with, similar businesses located in the state or
states in which the Properties are located.

 

“Permitted Encumbrances” means (a) the lien of any real estate taxes, water and
sewer charges, not yet due and payable; (b) those recorded easements,
restrictions, liens and encumbrances set forth as exceptions in the Title
Commitments and in the Title Policies to be issued by Title Company to Purchaser
and approved by Purchaser in its sole discretion in connection with this
Agreement; and (c) the Lease Agreement.

 

“Person” means any natural person, firm, corporation, partnership, limited
liability company, other entity, state, political subdivision of any state, the
United States of America, any agency or instrumentality of the United States of
America, any other public body or other organization or association.

 

“Property” or “Properties” has the meaning set forth in Section 1.01.

 

“Property Condition Reports” has the meaning set forth in Section 2.06.

 

“Purchase Price” means the amount specified in Section 1.02.

 

“Real Property” has the meaning set forth in Section 1.01.

 

“Regulated Substances” means “petroleum” and “petroleum-based substances” or any
similar terms described or defined in any Hazardous Materials Laws and any
applicable federal, state, county or local laws applicable to or regulating
USTs.

 

“Seller Documents” has the meaning set forth in Section 2.02.

 

“Seller Entity” or “Seller Entities” means individually or collectively, as the
context may require, Seller and Lessee, and any Affiliate of Seller and Lessee
and Guarantor.

 

“Surveys” has the meaning set forth in Section 2.03.

 

“Title Commitments” has the meaning set forth in Section 2.01(a).

 

“Title Company” means First American Title Insurance Company located 2425 E.
Camelback Road, Suite 300, Phoenix, Arizona 85016, Attention: Kristin Brown,
National Commercial Services, or an alternative title insurance company selected
by Purchaser.

 

“Title Objection” has the meaning set forth in Section 2.01(d)(i).

 

“Title Policies” has the meaning set forth in Section 2.01(a).

 

“Transaction” has the meaning set forth in Section 1.01.

 

 A-4 

 

  

“Transaction Costs” means all out-of-pocket costs and expenses incurred in
connection with the Transaction (whether or not the Transaction closes),
including but not limited to (a) the procurement, or if the same is provided by
Seller, the update, of any Property Condition Report, Environmental Report,
Survey, Title Commitments, Title Policies, all title policies required by
Purchaser’s lender, and all endorsements required by Purchaser and its lender,
(b) the Valuations, and (c) all taxes (including stamp taxes and transfer
taxes), escrow, closing, transfer and recording fees.

 

“Transaction Documents” means this Agreement, the Lease Agreement, the Memoranda
of Lease, the Guaranty, the Deeds, the Lease Proof of Insurance, the Non-Foreign
Seller Certificate, the Assignment of Warranties, the UCC-1 Financing
Statements, any and all documents referenced herein and therein, and such other
documents, payments, instruments and certificates as are reasonably required by
Purchaser and/or the Title Company.

 

“UCC-1 Financing Statements” means such UCC-1 Financing Statements as Purchaser
shall require with respect to the Transaction.

 

“UST Regulations” means 40 C.F.R. § 298 Subpart H – Financial Responsibility, or
any equivalent state law, with respect to petroleum underground storage tanks
(as such term is defined under 40 C.F.R. § 290.12 or any equivalent state law).

 

“USTs” means any one or combination of tanks and associated product piping
systems used in connection with storage, dispensing and general use of Regulated
Substances.

 

“Valuation” or “Valuations” has the meaning set forth in Section 2.05.

 

“Zoning Evidence” has the meaning set forth in Section 2.03.

 

 A-5 

 

 

EXHIBIT B

 

LEGAL DESCRIPTIONS / PROPERTY ADDRESSES

 

Street Addresses:

 

1442 Winchester Ave., Ashland, KY

 

4156 State Route 34, Hurricane, WV

 

3401 US Route 60 East, Barboursville, WV

 

1935, 1929-33, and 1921 Third Ave., Huntington, WV

 

Legal Descriptions: To be provided by Seller.

 

 B-1 

 

 

EXHIBIT C

 

NON-FOREIGN SELLER CERTIFICATE

 

STATE OF   )     ) ss: COUNTY OF   )

 

The undersigend, being first duly sworn deposes and states under penalty of
perjury:

 

1.That he/she is a                                           of _______________
____________, a _______________, the transferor of the Properties described on
Schedule I attached hereto.

 

2.That the transferor’s office address is at
                                                 .

 

3.That the United States taxpayer identification number for the transferor is
________________________.

 

4.That the transferor is not a “foreign person” as that term is defined in
Section 1445(f) of the United States Internal Revenue Code of 1986, as amended
(the “Code”).

 

5.That the transferor is not a disregarded entity as defined in § 1.1445
2(b)(2)(iii) of the regulations promulgated under the Code.

 

This affidavit is given to _______________________, a _______________, the
transferee of the Properties described in paragraph 1 above, for the purpose of
establishing and documenting the nonforeign affidavit exemption to the
withholding requirement of Section 1445 of the Code. The transferor understands
that this affidavit may be disclosed to the Internal Revenue Service by the
transferee and that any false statement contained herein could be punished by
fine, imprisonment, or both.

 

  ______________________________, a _______________         By: EXHIBIT – NOT
FOR SIGNATURE   Name:     Title:  

 

Subscribed and sworn to before me this _____ day of
                                        , 2______.

 

Notary Public:  __________________________     (SEAL) My Commission
Expires:  _________________  

 

 C-1 

 

 

Schedule I

to Non-foreign Seller Certificate

 

PROPERTIES

 

 C-2 

 

 

EXHIBIT D

 

ASSIGNMENT OF WARRANTIES

 

THIS ASSIGNMENT OF WARRANTIES (this “Assignment”), is made as of
_______________________, 20____ by and between _____________________________, a
____________________________ (“Assignor”) and _____________________________, a
____________________________ (“Assignee”).

 

WITNESSETH:

 

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated as of ________, 20____, by and between Assignor and Assignee (the
“Purchase Agreement”), Assignor agreed to sell to Assignee, inter alia, certain
real property, the improvements located thereon and certain rights appurtenant
thereto, all as more particularly described in the Purchase Agreement
(collectively, the “Property”). Initially capitalized terms not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Purchase Agreement; and

 

WHEREAS, the Purchase Agreement provides, inter alia, that Assignor shall assign
to Assignee rights to all guaranties and warranties relating to the Property and
that Assignor and Assignee shall enter into this Assignment.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto hereby agree as follows:

 

1.          Assignment of Warranties. Assignor hereby assigns, sets over and
transfers to Assignee all of Assignor’s right, title and interest in, to and
under any and all guaranties and warranties in effect with respect to all or any
portion of the Property as of the date hereof, if and only to the extent the
same may be assigned or quitclaimed by Assignor without expense to Assignor.
Assignee hereby accepts the foregoing assignment of guaranties and warranties.

 

2.          Miscellaneous. This Assignment and the obligations of the parties
hereunder shall survive the closing of the transaction referred to in the
Purchase Agreement and shall not be merged therein, shall be binding upon and
inure to the benefit of the parties hereto, their respective legal
representatives, successors and assigns and may not be modified or amended in
any manner other than by a written agreement signed by the party to be charged
therewith.

 

3.          Severability. If any term or provision of this Assignment or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Assignment or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Assignment shall be valid and enforced to the fullest
extent permitted by law.

 

4.          Counterparts. This Assignment may be executed in counterparts, each
of which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement.

 

 D-1 

 

  

IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the date
first set forth hereinabove.

 

  ASSIGNOR:       ___________________________________, a
___________________________________         By: EXHIBIT – NOT FOR SIGNATURE  
Name:     Title:           ASSIGNEE:        
___________________________________, a ___________________________________      
  By: EXHIBIT – NOT FOR SIGNATURE   Name:     Title:  

 

 D-2