UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): June 16, 2015
TRAVELCENTERS OF AMERICA LLC
(Exact name of registrant as specified in its charter)
Delaware |
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001-33274 |
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20-5701514 |
(State or other jurisdiction
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(Commission
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(IRS Employer
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24601 Center Ridge Road,
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44145 |
(Address of principal executive offices) |
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(Zip Code) |
440-808-9100
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
The disclosure under Item 2.01 of this Current Report on Form 8-K, or this Current Report, is incorporated herein by reference.
Item 2.01. Completion of Acquisition or Disposition of Assets.
As previously reported in our Current Report on Form 8-K dated June 1, 2015, or the June 1 Form 8-K, and our Current Report on Form 8-K dated June 9, 2015, or the June 9 Form 8-K, which Current Reports are incorporated herein by reference, on June 1, 2015, TravelCenters of America LLC, or the Company, and three of its subsidiaries, which subsidiaries we refer to collectively with the Company as we, our, us, or TA, entered a Transaction Agreement, or the Transaction Agreement, with our principal landlord, Hospitality Properties Trust, and four of its subsidiaries, which we refer to collectively as HPT, under which, among other things, HPT agreed to purchase from us for $279.4 million 14 travel centers we owned and certain assets we owned at 11 properties we currently lease from HPT, which properties HPT agreed to lease back to us. Defined terms used, but not defined, in this Current Report have the meanings ascribed to such terms in the June 9 Form 8-K.
On June 16, 2015, we completed the second closing of the transactions contemplated by the Transaction Agreement, which we refer to herein as the Second Closing, as follows:
· Our subsidiary, TA Operating LLC, or TA Operating, entered into two sales agreement with HPT, or the Sales Agreements, pursuant to which HPT purchased for approximately $24.4 million in aggregate one travel center we owned and certain assets we owned at another travel center that we lease from HPT under the New Lease No. 2 and HPT leased back the travel center and assets to us under the New Lease No. 4 and New Lease No. 2, respectively. Our annual rent increased by $2.1 million as a result of the sale and leaseback of the travel center and assets completed on June 16, 2015, which amount is reflected in the minimum annual rent amount under the New Lease No. 2 and New Lease No. 4 noted below.
· In connection with the Sales Agreements, TA Operating entered into first amendments to the New Lease No. 4 and New Lease No. 2 to add the travel center and assets, respectively, sold to HPT on June 16, 2015. Minimum annual rent under the New Lease No. 4 and New Lease No. 2, each as amended, is now approximately $41.8 million in the aggregate for each lease, subject to future adjustment if we complete the remaining transactions contemplated under the Transaction Agreement and if HPT purchases from TA capital improvements made to the leased travel centers.
The foregoing descriptions of the Sales Agreements and the New Leases and amendments thereto, which we refer to collectively as the Second Closing Agreements, the Transaction Agreement and the related transactions are not complete and are qualified in their entirety by reference to the full text of the Second Closing Agreements, the Transaction Agreement and the forms of the other related agreements, all of which are filed as exhibits to this Form 8-K, the June 9 Form 8-K or the June 1 Form 8-K and are incorporated by reference herein.
Information Regarding Certain Relationships
The information under Information Regarding Certain Relationships in the June 9 Form 8-K is incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosure under Item 2.01 of this Current Report is incorporated herein by reference.
WARNING CONCERNING FORWARD LOOKING STATEMENTS
THIS CURRENT REPORT CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER WE USE WORDS SUCH AS BELIEVE, EXPECT, ANTICIPATE, INTEND, PLAN, ESTIMATE OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY THESE FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR EXAMPLE, UNDER OUR TRANSACTION AGREEMENT WITH HPT, IN ADDITION TO THE TRANSACTIONS THAT HAVE ALREADY BEEN COMPLETED PURSUANT TO THE TRANSACTION AGREEMENT, WE AGREED TO SELL TO, AND LEASE BACK FROM, HPT ADDITIONAL TRAVEL CENTERS AND CERTAIN ASSETS. THESE SEVERAL AGREEMENTS CREATE SEPARATE CONTRACTUAL OBLIGATIONS. THE SEVERAL OBLIGATIONS ARE SUBJECT TO VARIOUS TERMS AND CONDITIONS TYPICAL OF LARGE, COMPLEX REAL ESTATE TRANSACTIONS. SOME OF THESE TERMS AND CONDITIONS MAY NOT BE SATISFIED AND, AS A RESULT, SOME OF THESE TRANSACTIONS MAY BE DELAYED, MAY NOT OCCUR OR THE TERMS MAY CHANGE.
THE INFORMATION CONTAINED IN OUR FILINGS WITH THE SEC, INCLUDING UNDER THE CAPTION RISK FACTORS IN OUR PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM OUR FORWARD LOOKING STATEMENTS. OUR FILINGS WITH THE SEC ARE AVAILABLE ON THE SECS WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON OUR FORWARD LOOKING STATEMENTS.
EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
10.1 First Amendment to Amended and Restated Lease Agreement No. 2, dated June 16, 2015, by and among HPT TA Properties Trust, HPT TA Properties LLC and TA Operating LLC (filed herewith)
10.2 First Amendment to Amended and Restated Lease Agreement No. 4, dated June 16, 2015, by and among HPT TA Properties Trust, HPT TA Properties LLC and TA Operating LLC (filed herewith)
10.3 Sales Agreement, dated June 16, 2015, between HPT TA Properties Trust and TA Operating LLC (filed herewith)
10.4 Sales Agreement, dated June 16, 2015, between HPT TA Properties Trust and TA Operating LLC (filed herewith)
10.5 Transaction Agreement, dated June 1, 2015, by and among Hospitality Properties Trust, HPT TA Properties Trust, HPT TA Properties LLC, HPT PSC Properties Trust, HPT PSC Properties LLC, TravelCenters of America LLC, TravelCenters of America Holding Company LLC, TA Leasing LLC, and TA Operating LLC (incorporated by reference to Exhibit 10.1 to our Current Report on 8-K dated June 1, 2015)
99.1 Pro Forma Financial Statements (filed herewith)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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TRAVELCENTERS OF AMERICA LLC |
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Date: June 22, 2015 |
By: |
/s/ Andrew J. Rebholz |
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Andrew J. Rebholz |
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Executive Vice President, Chief Financial Officer and Treasurer |
Exhibit 10.1
FIRST AMENDMENT TO
AMENDED AND RESTATED LEASE AGREEMENT NO. 2
THIS FIRST AMENDMENT TO AMENDED AND RESTATED LEASE AGREEMENT NO. 2 (this Amendment ) is made and entered into as of June 16, 2015 by and between HPT TA PROPERTIES TRUST , a Maryland real estate investment trust, and HPT TA PROPERTIES LLC , a Maryland limited liability company, as landlord (collectively, Landlord ), and TA OPERATING LLC , a Delaware limited liability company, as tenant ( Tenant ).
W I T N E S S E T H :
WHEREAS , Landlord and Tenant are parties to that certain Amended and Restated Lease Agreement No. 2, dated as of June 9, 2015 (the Lease ), pursuant to which Landlord leases to Tenant and Tenant leases from Landlord certain land and improvements, all as set forth in the Lease; and
WHEREAS , pursuant to the Lease, HPT TA Properties Trust leases to Tenant certain land having an address at 100 N. Carter Road, Ashland, Virginia 23005, as further described on Exhibit A-36 to the Lease (the Ashland Land );
WHEREAS , as of the date of this Amendment, HPT TA Properties Trust has acquired from Tenant the buildings and improvements which Tenant owned on the Ashland Land (collectively, the Ashland Improvements ) ; and
WHEREAS , Landlord and Tenant desire to amend the Lease to include the Ashland Improvements as part of the Leased Improvements (as defined in the Lease);
NOW, THEREFORE , in consideration of the mutual covenants herein contained and other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree, as of the date of this Amendment, as follows:
1. Capitalized Terms . Capitalized terms used and not otherwise defined in this Amendment shall have the meanings given such terms in the Lease.
2. Ashland Improvements . Landlord and Tenant hereby confirm that the Leased Improvements include the Ashland Improvements.
3. Minimum Rent . The defined term Minimum Rent set forth in Section 1.66 of the Lease is hereby deleted in its entirety and replaced with the following:
Minimum Rent shall mean Forty-One Million Seven Hundred Seventy-Three Thousand Eighty-One Dollars ($41,773,081), subject to adjustment as provided in Section 3.1.1(b) .
4. Ratification . As amended hereby, the Lease is hereby ratified and confirmed and all other terms remain in full force and effect.
IN WITNESS WHEREOF , Landlord and Tenant have caused this Amendment to be duly executed, as a sealed instrument, as of the date first above written.
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LANDLORD: |
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HPT TA PROPERTIES TRUST |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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HPT TA PROPERTIES LLC |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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TENANT: |
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TA OPERATING LLC |
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By: |
/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
Reference is made to that certain Guaranty Agreement, dated as of June 9, 2015, given by TRAVELCENTERS OF AMERICA LLC , a Delaware limited liability company (the Guarantor ), to Landlord with respect to Tenants obligations under the Lease (the Guaranty ). Guarantor hereby confirms that all references in such Guaranty to the word Lease shall mean the Lease, as defined therein, as amended by this Amendment, and said Guarantor hereby reaffirms the Guaranty.
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TRAVELCENTERS OF AMERICA LLC |
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By: |
/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
[Signature Page to 1 st Amendment to Lease No. 2]
Exhibit 10.2
FIRST AMENDMENT TO
AMENDED AND RESTATED LEASE AGREEMENT NO. 4
THIS FIRST AMENDMENT TO AMENDED AND RESTATED LEASE AGREEMENT NO. 4 (this Amendment ) is made and entered into as of June 16, 2015 by and between HPT TA PROPERTIES TRUST , a Maryland real estate investment trust, and HPT TA PROPERTIES LLC , a Maryland limited liability company, as landlord (collectively, Landlord ), and TA OPERATING LLC , a Delaware limited liability company, as tenant ( Tenant ).
W I T N E S S E T H :
WHEREAS , Landlord and Tenant are parties to that certain Amended and Restated Lease Agreement No. 4, dated as of June 9, 2015 (the Lease ), pursuant to which Landlord leases to Tenant and Tenant leases from Landlord certain land and/or improvements, all as set forth in the Lease; and
WHEREAS , as of the date of this Amendment, HPT TA Properties Trust has acquired from Tenant certain land and improvements comprising a travel center having an address at 15874 Eleven Mile Road, Battle Creek, Michigan 49014, as further described on Exhibit A-37 attached to this Amendment (collectively, the Battle Creek Property ) ; and
WHEREAS , Landlord and Tenant desire to amend the Lease to include the Battle Creek Property as a Property (as defined in the Lease);
NOW, THEREFORE , in consideration of the mutual covenants herein contained and other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree, as of the date of this Amendment, as follows:
1. Capitalized Terms . Capitalized terms used and not otherwise defined in this Amendment shall have the meanings given such terms in the Lease.
2. Commencement Date . The defined term Commencement Date shall mean, with respect to the Battle Creek Property, the date of this Amendment.
3. Minimum Rent . The defined term Minimum Rent set forth in Section 1.68 of the Lease is hereby deleted in its entirety and replaced with the following:
Minimum Rent shall mean Forty-One Million Eight Hundred Thirty-Seven Thousand Six Hundred Thirty-One Dollars ($41,837,631), subject to adjustment as provided in Section 3.1.1(b) .
4. Leased Property . Section 2.1(a) of the Lease is hereby amended by deleting the reference to Exhibits A-1 through A-36 in the second line thereof and replacing it with a reference to Exhibits A-1 through A-37 .
5. Exhibit A . Exhibit A to the Lease is hereby amended by (a) deleting the initial page entitled EXHIBITS A-1 through A-36 therefrom in its entirety and replacing it with the page entitled EXHIBITS A-1 through A-37 attached hereto and (b) adding Exhibit A-37 attached to this Amendment immediately following Exhibit A-36 to the Lease.
6. Exhibit B . Exhibit B to the Lease is hereby deleted in its entirety and replaced with Exhibit B attached to this Amendment.
7. Ratification . As amended hereby, the Lease is hereby ratified and confirmed and all other terms remain in full force and effect.
[Signature Page Follows]
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IN WITNESS WHEREOF , Landlord and Tenant have caused this Amendment to be duly executed, as a sealed instrument, as of the date first above written.
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LANDLORD: |
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HPT TA PROPERTIES TRUST |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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HPT TA PROPERTIES LLC |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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TENANT: |
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TA OPERATING LLC |
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By: |
/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
Reference is made to that certain Guaranty Agreement, dated as of June 9, 2015, given by TRAVELCENTERS OF AMERICA LLC , a Delaware limited liability company (the Guarantor ), to Landlord with respect to Tenants obligations under the Lease (the Guaranty ). Guarantor hereby confirms that all references in such Guaranty to the word Lease shall mean the Lease, as defined therein, as amended by this Amendment, and said Guarantor hereby reaffirms the Guaranty.
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TRAVELCENTERS OF AMERICA LLC |
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By: |
/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
[Signature Page to 1 st Amendment to Lease No. 4]
EXHIBITS A-1 through A-37
Land
Exhibit |
TA Site No. |
Property Address |
A-1 |
224 |
1806 Highway 371 W, Prescott, AR 71857. |
A-2 |
41 |
46155 Dillon Road, Coachella, CA 92236. |
A-3 |
346 |
28991 West Gonzaga Rd., Santa Nella, CA 95322. |
A-4 |
148 |
5101 Quebec Street, Commerce City (Denver East), CO 80022. |
A-5 |
22 |
327 Ruby Road, Willington, CT 06279. |
A-6 |
53 |
556 St. Rt. 44, Wildwood, FL 34785. |
A-7 |
45 |
P.O. Box 592, Madison, GA 30650. |
A-8 |
367 |
5915 Monee Rd., Monee, IL 60449. |
A-9 |
43 |
4510 Broadway, Mt. Vernon, IL 62864. |
A-10 |
257 |
10346 S. State Rd. 39, Clayton, IN 46118. |
A-11 |
220 |
1600 West US Hwy 20, Porter, IN 46304. |
A-12 |
252 |
2775 US Hwy 75, Lebo (Beto Junction), KS 66856. |
A-13 |
28 |
145 Richwood Road, Walton, KY 41094. |
A-14 |
180 |
1682 Gause Blvd., Slidell, LA 70458. |
A-15 |
19 |
1400 Elkton Road, Elkton, MD 21921. |
A-16 |
175 |
3265 N. Service Road East, Foristell, MO 63348. |
A-17 |
193 |
8033 W. Holling Rd., Alda (Grand Island), NE 68810. |
A-18 |
6 |
2 Simpson Road, Columbia, NJ 07832. |
A-19 |
81 |
2501 University Blvd. NE, Albuquerque, NM 87107. |
A-20 |
207 |
753 Upper Court St., Binghamton, NY 13904. |
A-21 |
194 |
8420 Alleghany Rd., Corfu (Pembroke), NY 14036. |
A-22 |
221 |
153 Wiggins Road, Candler, NC 28715. |
A-23 |
701 |
715 US 250 East, Ashland, OH 44805. |
A-24 |
139 |
12403 US Rt. 35 NW, Jeffersonville, OH 43128. |
A-25 |
95 |
4450 Portage St. NW, North Canton, OH 44720. |
A-26 |
152 |
P.O. Box 171, Sayre, OK 73662. |
A-27 |
67 |
5644 SR 8, Harrisville (Barkeyville), PA 16038. |
A-28 |
68 |
5600 Nittany Valley Drive, Lamar, PA 16848. |
A-29 |
179 |
3014 Paxville Highway, Manning, SC 29102. |
A-30 |
245 |
155 Hwy. 138, Denmark (Jackson), TN 38391. |
A-31 |
34 |
111 N. First Street, Nashville, TN 37213. |
A-32 |
150 |
7751 Bonnie View Road, Dallas (South), TX 75241. |
A-33 |
153 |
1010 Beltway Parkway, Laredo, TX 78045. |
A-34 |
232 |
4817 I-35 North, New Braunfels, TX 78130. |
A-35 |
32 |
RR1, Valley Grove, WV 26060. |
A-36 |
188 |
P.O. Box 400, Ft. Bridger, WY 82933. |
A-37 |
242 |
15874 Eleven Mile Road, Battle Creek, Michigan 49014. |
[See attached c opies.]
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EXHIBIT A-37 15874 Eleven Mile Road Battle Creek, Michigan 49014 Real property in the Township of Emmett, County of Calhoun, State of Michigan, described as follows: Parcel I: Parcel of land situated in Emmett Township, Calhoun County, Michigan, all that part of the following described premises lying North of the Northerly Right-of-Way of Highway I-94: Beginning 330 feet South of the Northwest corner of Section 13, Town 2 South, Range 7 West; thence East 505.75 feet; thence South to U.S. Highway #12, formerly Territorial Road and now known as Michigan Avenue; thence Northwesterly on said Highway to the West line of Section 13; thence North to the Place of Beginning. Excepting: Part of the Northwest 1/4 of Section 13, Town 2 South, Range 7 West, Emmett Township, Calhoun County, Michigan, described as: Commencing at the Northwest corner of said Section 13; thence South 00 degrees 09 minutes 47 seconds East 330.00 feet along the West line of said Section 13; thence South 89 degrees 26 minutes 17 seconds East, 505.75 feet; thence South 00 degrees 09 minutes 47 seconds East, 914.10 feet to the Point of Beginning; thence North 89 degrees 19 minutes 40 seconds West, 49.88 feet; thence South 59 degrees 50 minutes 13 seconds West, 62.49 feet; thence South 34 degrees 37 minutes 09 seconds West, 13.42 feet; thence South 60 degrees 09 minutes 47 seconds East, 74.65 feet; thence North 89 degrees 50 minutes 13 seconds East, 47.00 feet; thence North 00 degrees 09 minutes 47 seconds West, 78.86 feet to the Point of Beginning. Parcel II: Also, beginning at the Northwest corner of Section 13, Town 2 South, Range 7 West; running thence East 505.56 feet; thence South 330 feet; thence West 505.56 feet; thence North 330 feet to the Place of Beginning, Township of Emmett, Calhoun County, Michigan. |
EXHIBIT B
NEW PROPERTIES
TA Site No. |
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Property Address |
346 |
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28991 West Gonzaga Rd., Santa Nella, CA 95322. |
367 |
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5915 Monee Rd., Monee, IL 60449. |
252 |
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2775 US Hwy 75, Lebo (Beto Junction), KS 66856. |
153 |
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1010 Beltway Parkway, Laredo, TX 78045. |
242 |
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15874 Eleven Mile Road, Battle Creek, Michigan 49014. |
Exhibit 10.3
SALES AGREEMENT
between
HPT TA PROPERTIES TRUST
as Purchaser,
and
TA OPERATING LLC ,
as Seller
June 16, 2015
SALES AGREEMENT
THIS SALES AGREEMENT is made and entered into as of June 16, 2015 (the Effective Date ) between HPT TA PROPERTIES TRUST, a Maryland real estate investment trust, together with any of its successors and assigns as expressly permitted hereunder, as purchaser ( Purchaser ), and TA Operating LLC, a Delaware limited liability company, as seller ( Seller ).
PRELIMINARY STATEMENTS
Purchaser and Seller are parties, among others, to that certain Transaction Agreement, dated as of June 1, 2015 (the Transaction Agreement ), pursuant to which Seller agreed to sell and Purchaser agreed to purchase the Property (this and other capitalized terms used and not otherwise defined herein shall have the meaning given such terms in Article 1), subject to and in accordance with the terms and conditions in the Transaction Agreement and as hereinafter set forth.
NOW, THEREFORE, it is agreed:
ARTICLE 1
DEFINITIONS
1.1 Capitalized Terms . Capitalized terms used and not otherwise defined in this Agreement shall have the meanings set forth below or in the section of this Agreement referred to below and such definitions shall apply equally to the singular and plural forms of such terms.
Agreement : this Sales Agreement, together with all exhibits attached hereto.
Closing : the closing and consummation of the purchase and sale transaction contemplated by this Agreement.
Improvements : collectively, all buildings, structures and other improvements of every kind including, but not limited to, underground storage tanks, alleyways and connecting tunnels, sidewalks, utility pipes, conduits and lines (on-site and off-site), parking areas and roadways appurtenant to such buildings and structures situated upon the Land.
Intangible Property : collectively, all transferable or assignable permits, certificates of occupancy, sign permits, development rights and approvals, certificates, licenses, warranties and guarantees, and all other transferable intangible property, miscellaneous rights, benefits and privileges of any kind or character related to the ownership, and not the operation, of the Land and Improvements, but only to the extent the foregoing is assignable without cost to Seller.
Internal Revenue Code : the Internal Revenue Code of 1986, as amended and in effect from time to time, and including the applicable Treasury Regulations thereunder.
Land : collectively, the parcel or parcels of land described in Exhibit A together with all easements and appurtenances related thereto.
Permitted Encumbrances : collectively, applicable zoning, subdivision, building and other land use laws and regulations; liens for taxes, assessments and governmental charges not yet due and payable or due and payable but not yet delinquent; all matters shown on or referenced in the Title Commitment which are reasonably acceptable to Purchaser; and all matters shown on the Survey which are reasonably acceptable to Purchaser.
Property : collectively, all of Sellers right title and interest in and to the Real Property and/or the Intangible Property.
Purchase Price : Six Million Nine Hundred Fifty-Nine Thousand One Hundred Forty-Six dollars ($6,959,146).
Purchaser : the meaning given such term in the preamble of this Agreement.
Real Property : the Improvements.
Seller : the meaning given such term in the preamble of this Agreement.
Survey : the ALTA/ACSM land title survey of the Land and Improvements prepared by Landmark Fleet Surveyors and dated June 1, 2015.
Title Commitment : the title commitment for the Real Property issued by the Title Company and dated April 25, 2015.
Title Company : Stewart Title Guarantee Company.
ARTICLE 2
PURCHASE AND SALE; CLOSING
2.1 Purchase and Sale . In consideration of the payment of the Purchase Price by Purchaser to Seller as herein provided and for other good and valuable consideration, Seller shall sell the Property to Purchaser, and Purchaser shall purchase the Property from Seller, subject to and in accordance with the terms and conditions of this Agreement.
2.2 Closing . The purchase and sale of the Property shall be consummated contemporaneously with the execution of this Agreement.
2.3 Purchase Price . The purchase price to be paid by Purchaser to Seller for the Property shall be the Purchase Price.
2.4 IRS Real Estate Sales Reporting . Seller shall act as the person responsible for closing the transaction which is the subject of this Agreement pursuant to Section 6045(e) of the Internal Revenue Code and shall prepare and file all informational returns, including IRS Form 1099-S, and shall otherwise comply with the provisions of Section 6045(e) of the Internal Revenue Code.
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ARTICLE 3
CLOSING OBLIGATIONS
3.1 Sellers Closing Obligations . On the Effective Date, Seller shall deliver to Purchaser:
(i) A good and sufficient deed with covenants against grantors acts, or its local equivalent, in proper statutory form for recording, duly executed and acknowledged by Seller, conveying good and marketable fee simple title to the Real Property, free from all liens and encumbrances other than the Permitted Encumbrances;
(ii) A certificate of non-foreign status, pursuant to Section 1445 of the Internal Revenue Code, substantially in the form of Exhibit B , duly executed by TravelCenters of America LLC;
(iii) An executed counterpart amendment of the Amended and Restated TA Lease as contemplated by the Transaction Agreement; and
(iv) Such other conveyance documents, certificates, deeds, affidavits and other instruments as Purchaser, Seller or the Title Company may reasonably require to carry out the transactions contemplated by this Agreement and as are customary in like transactions in the area in which the Real Property is located.
3.2 Assignment and Assumption of Intangible Property and Indemnity . Seller hereby assigns to Purchaser all of Sellers right, title and interest in and to the Intangible Property to the extent first arising from and after the Effective Date. Purchaser hereby assumes all of Sellers obligations with respect to the Intangible Property to the extent first arising from and after the Effective Date. Purchaser hereby agrees to perform all of Sellers obligations with respect to the Intangible Property to the extent first arising from and after the Effective Date. In each case, subject to any lease or other agreement between Seller and Purchaser that may otherwise allocate responsibilities, Purchaser shall indemnify, defend and hold harmless Seller from and against any and all losses, costs, damages, demands, expenses, fees, fines, including reasonable attorneys fees ( Losses ) arising from the Intangible Property to the extent first arising from and after the Effective Date and Seller shall indemnify, defend and hold harmless Purchaser from and against any and all Losses arising from the Intangible Property to the extent first arising prior to the Effective Date.
3.3 Purchasers Closing Obligation . On the Effective Date, Purchaser shall pay the Purchase Price to Seller by wire transfer of immediately available funds as instructed by Seller and shall deliver an executed counterpart amendment of the Amended and Restated TA Lease as contemplated by the Transaction Agreement.
ARTICLE 4
PRORATIONS
4.1 Proration Items . Inasmuch as Seller will be leasing the Property from Purchaser on and after the Effective Date, all customary and usual prorations, including for ad valorem real estate taxes, personal property taxes, assessments or special assessments, water, gas, electric or
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other utilities, shall be made for the account of Seller as seller under this Agreement or as the tenant under the lease being entered into by Seller and Purchaser.
4.2 Survival . The obligations of the parties under this Article 4 shall survive the Closing.
ARTICLE 5
MISCELLANEOUS
5.1 Like-Kind Exchange . Seller may elect to effectuate the transaction contemplated by this Agreement as part of a forward like-kind exchange in accordance with Section 1031 of the Internal Revenue Code. In furtherance of the foregoing and notwithstanding anything contained in this Agreement to the contrary, Seller may assign its rights under this Agreement to a qualified intermediary in order to facilitate a forward like kind exchange under Section 1031 of the Internal Revenue Code, and Purchaser agrees to execute an instrument acknowledging and consenting to the same; provided , however , such assignment shall not relieve Seller of any of its obligations hereunder.
5.2 Governing Law . This Agreement shall be interpreted, construed, applied and enforced in accordance with the laws of The Commonwealth of Massachusetts.
5.3 Severability . If any provision of this Agreement shall be held or deemed to be, or shall in fact be, invalid, inoperative or unenforceable as applied to any particular case in any jurisdiction or jurisdictions, or in all jurisdictions or in all cases, because of the conflict of any provision with any constitution or statute or rule of public policy or for any other reason, such circumstance shall not have the effect of rendering the provision or provisions in question invalid, inoperative or unenforceable in any other jurisdiction or in any other case or circumstance or of rendering any other provision or provisions herein contained invalid, inoperative or unenforceable to the extent that such other provisions are not themselves actually in conflict with such constitution, statute or rule of public policy, but this Agreement shall be reformed and construed in any such jurisdiction or case as if such invalid, inoperative or unenforceable provision had never been contained herein and such provision reformed so that it would be valid, operative and enforceable to the maximum extent permitted in such jurisdiction or in such case.
5.4 No Third Party Beneficiaries . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns. This Agreement is not intended and shall not be construed to create any rights in or to be enforceable in any part by any other persons.
5.5 Entire Agreement . This Agreement and the Transaction Agreement constitute the entire agreement of the parties hereto with respect to the subject matter hereof and shall supersede and take the place of any other instruments purporting to be an agreement of the parties hereto relating to the subject matter hereof.
5.6 Merger . Except with respect to the any obligation expressly stated to survive the Closing, none of the terms or provisions of this Agreement shall survive the Closing, and the payment of the Purchase Price and delivery of the deed and other closing documents at the
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Closing shall effect a merger, and be deemed the full performance and discharge of every obligation on the part of Seller and /or Purchaser to be performed hereunder.
5.7 Counterparts . This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Any such counterparts or signatures may be delivered by facsimile or e-mail (in .pdf format), and any counterparts or signatures so delivered shall be deemed an original counterpart or signature for all purposes related to this Agreement.
5.8 Section and Other Headings . The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.
5.9 Time of Essence . Time shall be of the essence with respect to the performance of each and every covenant and obligation, and the giving of all notices, under this Agreement.
5.10 STATEMENT OF LIMITED LIABILITY . THE DECLARATION OF TRUST ESTABLISHING PURCHASER, DATED NOVEMBER 29, 2006, AS AMENDED AND SUPPLEMENTED, AS FILED WITH THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND, PROVIDES THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF PURCHASER SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, PURCHASER. ALL PERSONS DEALING WITH PURCHASER IN ANY WAY SHALL LOOK ONLY TO THE ASSETS OF PURCHASER FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
5.11 Survival . The provisions of this Article 5 shall survive the Closing.
[Remainder of page intentionally left blank; signature page follows.]
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IN WITNESS WHEREOF, Purchaser and Seller have caused this Agreement to be executed as a sealed instrument as of the date first above written.
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HPT TA PROPERTIES TRUST, |
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a Maryland real estate investment trust |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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SELLER: |
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TA OPERATING LLC, |
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a Delaware limited liability company |
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/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
[Signature Page to Sales Agreement Ashland, VA]
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Exhibit A Legal Description PARCEL 1: ALL that certain tract, piece or parcel of land, with the improvements thereon and appurtenances thereunto belonging, lying and being in Ashland District Hanover County, Virginia, containing 13.355 acres: as shown on Plat of Property Situated on the Northern Line of Route No. 54 and West of Route No. 95, Hanover County, Virginia, dated March 1, 1965, made by Chas, H. Fleet and Associates, Certified Surveyors, and being more particularly described as follows: BEGINNING, at a stone in the north line of State Route No. 54 at the point where the east line of the property of Humble Oil and Refining Company intersects said north line of State Route No. 54: thence extending N. 6 degrees 15 W. 150 feet to a rod: thence S. 77 degrees 41 54 W. 200 feet to a rod: thence S. 6 degrees 15 E. 150 feet to a rod in the said north line of State Route No. 54: thence along the said north line of State Route No. 54 S. 77 degrees 41 54 W. 30.59 feet to a stone and from said stone continuing, westwardly 69.41 feet to a rod: thence back from the north line of State Route No. 54 N. 6 degrees 15 W. 148.66 feet to a rod: thence N. 8 degrees 26 43 E. 471.50 feet to a rod: thence N. 77 degrees 41 54 E. 100.15 feet to a rod: thence N. 8 degrees 26. 43 E. 347.70 feet to a rod: thence S. 85 degrees 32 E. 646.09 feet to a rod: thence S. 4 degrees 12 48 W. 613.82 feet to a stone: thence S. 54 degrees 25 34 W. 68.45 feet to a stone: thence S. 35 degrees 20 W. 66.62 feet to a stone: thence S. 75 degrees 52 10 W. 299.89 feet to a stone: thence S. 71 degrees 55 30 W. 100.69 feet to a stone: thence S. 13 degrees 36 W. 45.35 feet to the point and place of beginning. LESS AND EXCEPT: A 100 foot by 150 foot parcel of land located fronting on Route No. 54 between the American Oil Station and the Humble Oil Station, said parcel having been conveyed to Truckstops Corporation of America from E. Philip Saunders and Carole Saunders, his wife, by Deed dated August 31, 1983, and recorded in Hanover County, Virginia, in Deed Book 539, Page 135, and re-recorded on December 15, 1983, in Deed Book 542, Page 312. LESS AND EXCEPT: That parcel of land conveyed to the Commonwealth of Virginia, for land for Route 54, by Deed dated October 24, 1966, and recorded March 10, 1967, in the aforesaid Clerks Office, in Deed Book 264, Page 185. PARCEL 2: ALL that piece or parcel of land containing 6.00 acres, lying and being in Ashland District. Hanover County, Virginia, as shown on a plat of subdivision entitled Interstate Commercial Park Subdivision. Section L dated January 25, 1982, prepared by Johnson & Anderson of Virginia, Inc., a copy of which is recorded in the Clerks Office, Circuit Court, Hanover County, Virginia, in Plat Book 5, Page 135, reference to which is hereby made for a more particular description of the property herein conveyed. PARCEL 3: ALL that certain piece or parcel of land on the northern line of Route No. 54, containing 0.34 acre, according to a survey plat dated January 13, 1983, and revised March 1, 1983, prepared by Chas, H. Fleet & Associates, Engineer & Surveyors, located in the Ashland District, Hanover County, Virginia, and more particularly described as: BEGINNING at a rod on the northern line of Route No. 54, approximate 0.24 mile west of Interstate Route No. 95, where the western property line of Exxon Corporation intersects the said northern line of Route No. 54: thence (1) along the said northern line of Route No. 54, in a westerly direction S. 77 degrees - 41 54 W. 30.59 feet to a stone monument: thence (2) continuing along the said northern line of Route No. 54 in a westwardly direction, which is a curved line to the right having a radius of 1,803.86 feet and a length of 69.41 feet to an iron rod thence (3) in a northwardly direction N. 6 degrees - 15 W. 148.66 feet to an iron rod: thence (4) continuing in a northwardly direction N. 8 degrees - 26 - 43 E. |
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1.34 feet to an iron rod; thence (5) in an eastwardly direction N. 78 degrees 25 13 E. 99.66 feet to an iron rod; thence (6) in a southwardly direction S. 6 degrees 15 E. 150.00 feet to an iron rod on the northern line of Route No. 54, the point of beginning. ALL of the above described land being the same as follows: BEGINNING at a stone in the North line of State Route No. 54 at the point where the East line of the property of Exxon Company intersects said North line of State Route No. 54; thence extending N. 6 degrees 1500 W. a distance of 150.00 feet to a nail: thence S. 77 degrees 41 54 W. a distance of 200.00 feet to a rod; thence S. 6 degrees 15 00 E. a distance of 150.00 feet to a rod in said North line of State Route No. 54; thence along said North line of State Route No. 54 S. 77 degrees 41 54 W. a distance of 30.59 feet to a stone; thence along a curve to the right. having a radius of 1.803.86 feet and a length of 69.41 feet to a rod; thence leaving State Route No. 54 N. 6 degrees 15 00 W. a distance of 148.66 feet to a rod; thence N. 8 degrees 26 43 E a distance of 471.50 feet to a rod, thence N. 77 degrees 41 54 E. a distance of 100.15 feet to a spike: thence N. 8 degrees 26 43 E. a distance of 347.70 feet to a rod; thence N. 85 degrees 32 00 W. a distance of 30.37 feet to a rod; thence N. 00 degrees 05 09 W. a distance of 379.60 feet to a rod; thence 8.85 degrees 32 06 E. 704.92 feet; thence S. 04 degrees 12 48 W. a distance or 992.23 feet to a rod; thence S. 54 degrees 25 34 W. a distance of 88.45 feet to a rod: thence S. 35 degrees 20 00 W. a distance of 66.62 feet to a lead hub; thence S. 81 degrees 3144 W. a distance of 378.83 feet to a nail; thence S. 13 degrees 36 00 W. a distance of 95.38 feet to the point of beginning and containing 19.178 acres. BEING the same property conveyed to HPT TA Properties Trust. a Maryland real estate investment trust, by Special Warranty Deed from TA Operating LLC. a Delaware limited liability company (formerly TA Operating Corporation), dated January 31, 2007, and recorded February 22, 2007, in the Clerks Office, Circuit Court, Hanover County. Virginia. in Deed Book 2844, Page 241. Purported Address: 100 North Carter Road, Ashland, VA 23005 |
EXHIBIT B
Form of FIRPTA Certificate
(See attached)
FIRPTA CERTIFICATE
Section 1445 of the Internal Revenue Code of 1986, as amended, provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person. For U.S. federal income tax purposes (including Section 1445), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity. To inform the transferee that withholding of tax is not required upon the disposition of a U.S. real property interest by TravelCenters of America LLC, a Delaware limited liability company ( Transferor ), pursuant to the Development Property Agreement, dated as of [ · ], 2015, between TA Operating LLC and [HPT entity], Transferor hereby certifies to [transferee entity] ( Transferee ) the following:
Transferor is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as those terms are defined in the Internal Revenue Code and income tax regulations thereunder);
Transferor is not a disregarded entity as defined in Treasury Regulation Section 1.1445-2(b)(2)(iii);
TA Operating LLC, which has legal title to one or more transferred U.S. real property interests under local law, is disregarded as an entity separate from Transferor for U.S. federal income tax purposes;
Transferors U.S. employer identification number is 20-5701514; and
Transferors office address is 24601 Center Ridge Road, Westlake, OH 44145.
The undersigned and Transferor understand that this certificate may be disclosed to the Internal Revenue Service by Transferee and any transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.
[Remainder of page intentionally left blank; signature page follows.]
Under penalties of perjury I declare that I have examined this certification and to the best of my knowledge and belief it is true, correct, and complete, and I further declare that I have the authority to sign this document on behalf of Transferor.
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Date: [ · ], 2015
Exhibit 10.4
SALES AGREEMENT
between
HPT TA PROPERTIES TRUST,
as Purchaser,
and
TA OPERATING LLC ,
as Seller
JUNE 16, 2015
SALES AGREEMENT
THIS SALES AGREEMENT is made and entered into as of June 16, 2015 (the Effective Date ) between HPT TA Properties Trust, a Maryland real estate investment trust, together with any of its successors and assigns as expressly permitted hereunder, as purchaser ( Purchaser ), and TA Operating LLC, a Delaware limited liability company, as seller ( Seller ).
PRELIMINARY STATEMENTS
Purchaser and Seller are parties, among others, to that certain Transaction Agreement, dated as of June 1, 2015 (the Transaction Agreement ), pursuant to which Seller agreed to sell and Purchaser agreed to purchase the Property (this and other capitalized terms used and not otherwise defined herein shall have the meaning given such terms in Article 1), subject to and in accordance with the terms and conditions in the Transaction Agreement and as hereinafter set forth.
NOW, THEREFORE, it is agreed:
ARTICLE 1
DEFINITIONS
1.1 Capitalized Terms . Capitalized terms used and not otherwise defined in this Agreement shall have the meanings set forth below or in the section of this Agreement referred to below and such definitions shall apply equally to the singular and plural forms of such terms.
Agreement : this Sales Agreement, together with all exhibits attached hereto.
Closing : the closing and consummation of the purchase and sale transaction contemplated by this Agreement.
Improvements : collectively, all buildings, structures and other improvements of every kind including, but not limited to, underground storage tanks, alleyways and connecting tunnels, sidewalks, utility pipes, conduits and lines (on-site and off-site), parking areas and roadways appurtenant to such buildings and structures situated upon the Land.
Intangible Property : collectively, all transferable or assignable permits, certificates of occupancy, sign permits, development rights and approvals, certificates, licenses, warranties and guarantees, and all other transferable intangible property, miscellaneous rights, benefits and privileges of any kind or character related to the ownership, and not the operation, of the Land and Improvements, but only to the extent the foregoing is assignable without cost to Seller.
Internal Revenue Code : the Internal Revenue Code of 1986, as amended and in effect from time to time, and including the applicable Treasury Regulations thereunder.
Land : collectively, all of Sellers right, title and interest in and to the parcel or parcels of land described in Exhibit A together with all easements and appurtenances related thereto.
Permitted Encumbrances : collectively, applicable zoning, subdivision, building and other land use laws and regulations; liens for taxes, assessments and governmental charges not yet due and payable or due and payable but not yet delinquent; all matters shown on or referenced in the Title Commitment which are reasonably acceptable to Purchaser; and all matters shown on the Survey which are reasonably acceptable to Purchaser.
Property : collectively, all of Sellers right title and interest in and to the Real Property and/or the Intangible Property.
Purchase Price : Seventeen Million Four Hundred Fifty-Five Thousand Four Hundred Ninety-Five and No/100 Dollars ($17,455,495.00).
Purchaser : the meaning given such term in the preamble of this Agreement.
Real Property : collectively, the Land and the Improvements.
Seller : the meaning given such term in the preamble of this Agreement.
Survey : the ALTA/ACSM land title survey of the Real Property coordinated by Commercial Due Diligence Services and dated June 21, 2012.
Title Commitment : the title commitment for the Real Property issued by the Title Company and dated March 31, 2015.
Title Company : First American Title Insurance Company.
ARTICLE 2
PURCHASE AND SALE; CLOSING
2.1 Purchase and Sale . In consideration of the payment of the Purchase Price by Purchaser to Seller as herein provided and for other good and valuable consideration, Seller shall sell the Property to Purchaser, and Purchaser shall purchase the Property from Seller, subject to and in accordance with the terms and conditions of this Agreement.
2.2 Closing . The purchase and sale of the Property shall be consummated contemporaneously with the execution of this Agreement.
2.3 Purchase Price . The purchase price to be paid by Purchaser to Seller for the Property shall be the Purchase Price.
2.4 IRS Real Estate Sales Reporting . Seller shall act as the person responsible for closing the transaction which is the subject of this Agreement pursuant to Section 6045(e) of the Internal Revenue Code and shall prepare and file all informational returns, including IRS Form 1099-S, and shall otherwise comply with the provisions of Section 6045(e) of the Internal Revenue Code.
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ARTICLE 3
CLOSING OBLIGATIONS
3.1 Sellers Closing Obligations . On the Effective Date, Seller shall deliver to Purchaser:
(i) A good and sufficient deed with covenants against grantors acts, or its local equivalent, in proper statutory form for recording, duly executed and acknowledged by Seller, conveying good and marketable fee simple title to the Real Property, free from all liens and encumbrances other than the Permitted Encumbrances;
(ii) A certificate of non-foreign status, pursuant to Section 1445 of the Internal Revenue Code, substantially in the form of Exhibit B , duly executed by TravelCenters of America LLC;
(iii) An executed counterpart amendment of the Amended and Restated TA Lease as contemplated by the Transaction Agreement; and
(iv) Such other conveyance documents, certificates, deeds, affidavits and other instruments as Purchaser, Seller or the Title Company may reasonably require to carry out the transactions contemplated by this Agreement and as are customary in like transactions in the area in which the Real Property is located.
3.2 Assignment and Assumption of Intangible Property and Indemnity . Seller hereby assigns to Purchaser all of Sellers right, title and interest in and to the Intangible Property to the extent first arising from and after the Effective Date. Purchaser hereby assumes all of Sellers obligations with respect to the Intangible Property to the extent first arising from and after the Effective Date. Purchaser hereby agrees to perform all of Sellers obligations with respect to the Intangible Property to the extent first arising from and after the Effective Date. In each case, subject to any lease or other agreement between Seller and Purchaser that may otherwise allocate responsibilities, Purchaser shall indemnify, defend and hold harmless Seller from and against any and all losses, costs, damages, demands, expenses, fees, fines, including reasonable attorneys fees ( Losses ) arising from the Intangible Property to the extent first arising from and after the Effective Date and Seller shall indemnify, defend and hold harmless Purchaser from and against any and all Losses arising from the Intangible Property to the extent first arising prior to the Effective Date.
3.3 Purchasers Closing Obligation . On the Effective Date, Purchaser shall pay the Purchase Price to Seller by wire transfer of immediately available funds as instructed by Seller and shall deliver an executed counterpart amendment of the Amended and Restated TA Lease as contemplated by the Transaction Agreement.
ARTICLE 4
PRORATIONS
4.1 Proration Items . Inasmuch as Seller will be leasing the Property from Purchaser on and after the Effective Date, all customary and usual prorations, including for ad valorem real estate taxes, personal property taxes, assessments or special assessments, water, gas, electric or
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other utilities, shall be made for the account of Seller as seller under this Agreement or as the tenant under the lease being entered into by Seller and Purchaser.
4.2 Survival . The obligations of the parties under this Article 4 shall survive the Closing.
ARTICLE 5
MISCELLANEOUS
5.1 Like-Kind Exchange . Seller may elect to effectuate the transaction contemplated by this Agreement as part of a forward like-kind exchange in accordance with Section 1031 of the Internal Revenue Code. In furtherance of the foregoing and notwithstanding anything contained in this Agreement to the contrary, Seller may assign its rights under this Agreement to a qualified intermediary in order to facilitate a forward like kind exchange under Section 1031 of the Internal Revenue Code, and Purchaser agrees to execute an instrument acknowledging and consenting to the same; provided , however , such assignment shall not relieve Seller of any of its obligations hereunder.
5.2 Governing Law . This Agreement shall be interpreted, construed, applied and enforced in accordance with the laws of The Commonwealth of Massachusetts.
5.3 Severability . If any provision of this Agreement shall be held or deemed to be, or shall in fact be, invalid, inoperative or unenforceable as applied to any particular case in any jurisdiction or jurisdictions, or in all jurisdictions or in all cases, because of the conflict of any provision with any constitution or statute or rule of public policy or for any other reason, such circumstance shall not have the effect of rendering the provision or provisions in question invalid, inoperative or unenforceable in any other jurisdiction or in any other case or circumstance or of rendering any other provision or provisions herein contained invalid, inoperative or unenforceable to the extent that such other provisions are not themselves actually in conflict with such constitution, statute or rule of public policy, but this Agreement shall be reformed and construed in any such jurisdiction or case as if such invalid, inoperative or unenforceable provision had never been contained herein and such provision reformed so that it would be valid, operative and enforceable to the maximum extent permitted in such jurisdiction or in such case.
5.4 No Third Party Beneficiaries . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns. This Agreement is not intended and shall not be construed to create any rights in or to be enforceable in any part by any other persons.
5.5 Entire Agreement . This Agreement and the Transaction Agreement constitute the entire agreement of the parties hereto with respect to the subject matter hereof and shall supersede and take the place of any other instruments purporting to be an agreement of the parties hereto relating to the subject matter hereof.
5.6 Merger . Except with respect to the any obligation expressly stated to survive the Closing, none of the terms or provisions of this Agreement shall survive the Closing, and the payment of the Purchase Price and delivery of the deed and other closing documents at the
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Closing shall effect a merger, and be deemed the full performance and discharge of every obligation on the part of Seller and /or Purchaser to be performed hereunder.
5.7 Counterparts . This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Any such counterparts or signatures may be delivered by facsimile or e-mail (in .pdf format), and any counterparts or signatures so delivered shall be deemed an original counterpart or signature for all purposes related to this Agreement.
5.8 Section and Other Headings . The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.
5.9 Time of Essence . Time shall be of the essence with respect to the performance of each and every covenant and obligation, and the giving of all notices, under this Agreement.
5.10 STATEMENT OF LIMITED LIABILITY . THE DECLARATION OF TRUST ESTABLISHING PURCHASER, DATED NOVEMBER 29, 2006, AS AMENDED AND SUPPLEMENTED, AS FILED WITH THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND, PROVIDES THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF PURCHASER SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, PURCHASER. ALL PERSONS DEALING WITH PURCHASER IN ANY WAY SHALL LOOK ONLY TO THE ASSETS OF PURCHASER FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
5.11 Survival . The provisions of this Article 5 shall survive the Closing.
[Remainder of page intentionally left blank; signature page follows.]
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IN WITNESS WHEREOF, Purchaser and Seller have caused this Agreement to be executed as a sealed instrument as of the date first above written.
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HPT TA PROPERTIES TRUST, |
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a Maryland real estate investment trust |
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By: |
/s/ John G. Murray |
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John G. Murray |
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President |
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SELLER: |
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TA OPERATING LLC, |
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a Delaware limited liability company |
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By: |
/s/ Mark R. Young |
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Mark R. Young |
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Executive Vice President |
[Signature Page: Sales Agreement Battle Creek, Michigan]
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EXHIBIT A Legal Description Real property in the Township of Emmett, County of Calhoun, State of Michigan, described as follows: Parcel I: Parcel of land situated in Emmett Township, Calhoun County, Michigan, all that part of the following described premises lying North of the Northerly Right-of-Way of Highway I-94: Beginning 330 feet South of the Northwest corner of Section 13, Town 2 South, Range 7 West; thence East 505.75 feet; thence South to U.S. Highway #12, formerly Territorial Road and now known as Michigan Avenue; thence Northwesterly on said Highway to the West line of Section 13; thence North to the Place of Beginning. Excepting: Part of the Northwest 1/4 of Section 13, Town 2 South, Range 7 West, Emmett Township, Calhoun County, Michigan, described as: Commencing at the Northwest corner of said Section 13; thence South 00 degrees 09 minutes 47 seconds East 330.00 feet along the West line of said Section 13; thence South 89 degrees 26 minutes 17 seconds East, 505.75 feet; thence South 00 degrees 09 minutes 47 seconds East, 914.10 feet to the Point of Beginning; thence North 89 degrees 19 minutes 40 seconds West, 49.88 feet; thence South 59 degrees 50 minutes 13 seconds West, 62.49 feet; thence South 34 degrees 37 minutes 09 seconds West, 13.42 feet; thence South 60 degrees 09 minutes 47 seconds East, 74.65 feet; thence North 89 degrees 50 minutes 13 seconds East, 47.00 feet; thence North 00 degrees 09 minutes 47 seconds West, 78.86 feet to the Point of Beginning. Parcel II: Also, beginning at the Northwest corner of Section 13, Town 2 South, Range 7 West; running thence East 505.56 feet; thence South 330 feet; thence West 505.56 feet; thence North 330 feet to the Place of Beginning, Township of Emmett, Calhoun County, Michigan. |
A-1
EXHIBIT B
Form of FIRPTA Certificate
(See attached)
B-1
FIRPTA CERTIFICATE
Section 1445 of the Internal Revenue Code of 1986, as amended, provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person. For U.S. federal income tax purposes (including Section 1445), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity. To inform the transferee that withholding of tax is not required upon the disposition of a U.S. real property interest by TravelCenters of America LLC , a Delaware limited liability company ( Transferor ), pursuant to the Sales Agreement, dated as of June __, 2015, between TA Operating LLC and HPT TA Properties Trust ( Transferee ), Transferee the following:
1. Transferor is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as those terms are defined in the Internal Revenue Code and income tax regulations thereunder);
2. Transferor is not a disregarded entity as defined in Treasury Regulation Section 1.1445-2(b)(2)(iii);
3. TA Operating LLC, which has legal title to one or more transferred U.S. real property interests under local law, is disregarded as an entity separate from Transferor for U.S. federal income tax purposes;
4. Transferors U.S. employer identification number is 20-5701514 ; and
5. Transferors office address is 24601 Center Ridge Road, Westlake, OH 44145.
The undersigned and Transferor understand that this certificate may be disclosed to the Internal Revenue Service by Transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.
[Remainder of page intentionally left blank; signature page follows.]
Under penalties of perjury I declare that I have examined this certification and to the best of my knowledge and belief it is true, correct, and complete, and I further declare that I have the authority to sign this document on behalf of Transferor.
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TravelCenters of America LLC, |
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a Delaware limited liability company |
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Date: June __, 2015
Exhibit 99.1
Pro Forma Condensed Consolidated Financial Statements (Unaudited)
On June 1, 2015, TravelCenters of America LLC and three of its subsidiaries, which we refer to collectively as we, our, us, or TA, entered into a Transaction Agreement with our principal landlord, Hospitality Properties Trust, and four of its subsidiaries, which we refer to collectively as HPT, as disclosed in the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 5, 2015. The transactions contemplated by the Transaction Agreement, include (i) the amendment and restatement of our lease with HPT for 144 properties, which we refer to as the Prior Lease, (ii) the sale of properties and other assets to, and our lease back of those properties and assets from, HPT and (iii) the purchase of properties from HPT.
On June 9, 2015 and June 16, 2015, we completed the first two transactions contemplated by the Transaction Agreement as summarized below:
· On June 9, 2015, the Prior Lease was amended and restated into four new leases, which we refer to collectively as the Leases. The initial terms for the Leases end on December 31, 2026, 2028, 2029 and 2030, respectively. Each of the Leases grants us two renewal options of fifteen years each.
· On June 9, 2015, HPT purchased from us, for $183.4 million, 10 travel centers we owned and certain assets we owned at eight properties we leased from HPT under the Prior Lease. HPT leased back these properties to us under the Leases. Our annual rent increased by $15.8 million as a result of the sale and lease back of properties completed on June 9, 2015.
· On June 9, 2015, we purchased from HPT, for $45.0 million, five travel centers that we previously leased from HPT under the Prior Lease. Our annual rent decreased by $3.9 million as a result of our completion of the purchase of these properties.
· On June 16, 2015, HPT purchased from us, for $24.4 million, one travel center we owned and certain assets we owned at another travel center that we lease from HPT under one of the Leases and HPT leased back the travel center and assets to us under two of the Leases. Our annual rent increased by $2.1 million as a result of the sale and leaseback of the travel center and assets completed on June 16, 2015.
As of June 16, 2015, after giving effect to the above referenced transactions completed through that date, we leased a total of 150 properties from HPT under the Leases.
Additional sales contemplated by the Transaction Agreement of three other properties and the assets at two other properties for $71.6 million are expected to close before the end of June 2015, unless we exercise our right to delay the sale and lease of three of the properties with an aggregate sale price of $51.5 million to no later than December 31, 2015. As of June 16, 2015 we have not determined whether we will exercise this right to delay. Our annual rent will increase by an additional $6.2 million (for a combined net increase of $20.2 million after giving effect to and assuming completion of all the applicable transactions contemplated by the Transaction Agreement, excluding the five properties we agreed to sell upon completion of their development) upon the completion of the sale and lease back of these remaining properties and assets.
The pro forma financial statements included herein include adjustments related to our purchase of assets and our sale and lease back of assets on June 9, 2015 and June 16, 2015, as well as the additional sale and lease back of three properties and the assets at two other properties for $71.6 million that are expected to occur prior to December 31, 2015, as described above. The pro forma financial statements reflect the amendments to the terms of our leases with HPT.
The adjustments to the pro forma condensed consolidated balance sheet as of March 31, 2015, assume that these transactions occurred on that date. The adjustments to the pro forma condensed consolidated statements of income for the three months ended March 31, 2015, and for the year ended December 31, 2014, assume that these transactions occurred on January 1, 2014. The pro forma financial statements are primarily based on, and should be read in conjunction with our audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2014, which we refer to as our Annual Report, and our unaudited condensed consolidated financial statements and accompanying notes included in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, which we refer to as our Quarterly Report.
The historical consolidated financial information of TA has been adjusted in the pro forma financial statements to give effect to pro forma events that are (1) directly attributable to the transactions, (2) factually supportable, and (3) expected to have a continuing impact on the results of operations. The pro forma financial statements should be read in conjunction with the accompanying notes.
Travel Centers of America LLC
Pro Forma Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
|
|
March 31,
|
|
Transaction
|
|
Note |
|
March 31, 2015
|
|
|||
Assets |
|
|
|
|
|
|
|
|
|
|||
Current assets: |
|
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
218,151 |
|
$ |
234,340 |
|
2(a) |
|
$ |
452,491 |
|
Accounts receivable (less allowance for doubtful accounts of $1,210 as of March 31, 2015) |
|
119,977 |
|
|
|
|
|
119,977 |
|
|||
Inventories |
|
172,139 |
|
|
|
|
|
172,139 |
|
|||
Other current assets |
|
66,700 |
|
|
|
|
|
66,700 |
|
|||
Total current assets |
|
576,967 |
|
234,340 |
|
|
|
811,307 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Property and equipment, net |
|
814,605 |
|
(191,945 |
) |
2(b) |
|
622,660 |
|
|||
Goodwill and intangible assets, net |
|
57,234 |
|
|
|
|
|
57,234 |
|
|||
Other noncurrent assets |
|
42,758 |
|
|
|
|
|
42,758 |
|
|||
Total assets |
|
$ |
1,491,564 |
|
$ |
42,395 |
|
|
|
$ |
1,533,959 |
|
|
|
|
|
|
|
|
|
|
|
|||
Liabilities and Shareholders Equity |
|
|
|
|
|
|
|
|
|
|||
Current liabilities: |
|
|
|
|
|
|
|
|
|
|||
Accounts payable |
|
$ |
142,513 |
|
$ |
|
|
|
|
$ |
142,513 |
|
Current HPT Leases liabilities |
|
31,785 |
|
7,093 |
|
2(d) |
|
38,878 |
|
|||
Other current liabilities |
|
132,991 |
|
|
|
|
|
132,991 |
|
|||
Total current liabilities |
|
307,289 |
|
7,093 |
|
|
|
314,382 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Noncurrent HPT Leases liabilities |
|
330,290 |
|
(84,777 |
) |
2(c) |
|
245,513 |
|
|||
Deferred gain |
|
|
|
131,355 |
|
2(d) |
|
131,355 |
|
|||
Long term debt |
|
230,000 |
|
|
|
|
|
230,000 |
|
|||
Other noncurrent liabilities |
|
88,668 |
|
(877 |
) |
2(e) |
|
83,746 |
|
|||
|
|
|
|
(4,045 |
) |
2(f) |
|
|
|
|||
Total liabilities |
|
956,247 |
|
48,749 |
|
|
|
1,004,996 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Total shareholders equity |
|
535,317 |
|
(6,354 |
) |
2(f) |
|
528,963 |
|
|||
Total liabilities and shareholders equity |
|
$ |
1,491,564 |
|
$ |
42,395 |
|
|
|
$ |
1,533,959 |
|
Travel Centers of America LLC
Pro Forma Condensed Consolidated Statements of Income (Unaudited)
Three Months Ended March 31, 2015
(in thousands, except per share data)
|
|
As reported |
|
Transaction
|
|
Note |
|
Pro forma |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Fuel |
|
$ |
1,003,167 |
|
$ |
|
|
|
|
$ |
1,003,167 |
|
Nonfuel |
|
401,510 |
|
|
|
|
|
401,510 |
|
|||
Rent and royalties from franchisees |
|
3,024 |
|
|
|
|
|
3,024 |
|
|||
Total revenues |
|
1,407,701 |
|
|
|
|
|
1,407,701 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Cost of goods sold (excluding depreciation): |
|
|
|
|
|
|
|
|
|
|||
Fuel |
|
890,780 |
|
|
|
|
|
890,780 |
|
|||
Nonfuel |
|
178,422 |
|
|
|
|
|
178,422 |
|
|||
Total cost of goods sold |
|
1,069,202 |
|
|
|
|
|
1,069,202 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Site level operating |
|
205,584 |
|
|
|
|
|
205,584 |
|
|||
Selling, general & administrative |
|
27,616 |
|
|
|
|
|
27,616 |
|
|||
Real estate rent |
|
55,604 |
|
5,970 |
|
2(g) |
|
61,574 |
|
|||
Depreciation and amortization |
|
17,525 |
|
(2,623 |
) |
2(h) |
|
14,902 |
|
|||
Total operating expenses |
|
306,329 |
|
3,347 |
|
|
|
309,676 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Income from operations |
|
32,170 |
|
(3,347 |
) |
|
|
28,823 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Acquisition costs |
|
414 |
|
|
|
|
|
414 |
|
|||
Interest expense, net |
|
6,332 |
|
(1,452 |
) |
2(g) |
|
4,880 |
|
|||
Income before income taxes and income from equity investees |
|
25,424 |
|
(1,895 |
) |
|
|
23,529 |
|
|||
Provision for income taxes |
|
(10,486 |
) |
737 |
|
2(i) |
|
(9,749 |
) |
|||
Income from equity investees |
|
791 |
|
|
|
|
|
791 |
|
|||
Net income |
|
$ |
15,729 |
|
$ |
(1,158 |
) |
|
|
$ |
14,571 |
|
|
|
|
|
|
|
|
|
|
|
|||
Net income per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic and diluted |
|
$ |
0.41 |
|
$ |
(0.03 |
) |
|
|
$ |
0.38 |
|
Travel Centers of America LLC
Pro Forma Condensed Consolidated Statements of Income (Unaudited)
Year Ended December 31, 2014
(in thousands, except per share data)
|
|
As reported |
|
Transaction
|
|
Note |
|
Pro forma |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Fuel |
|
$ |
6,149,449 |
|
$ |
|
|
|
|
$ |
6,149,449 |
|
Nonfuel |
|
1,616,802 |
|
|
|
|
|
1,616,802 |
|
|||
Rent and royalties from franchisees |
|
12,382 |
|
|
|
|
|
12,382 |
|
|||
Total revenues |
|
7,778,633 |
|
|
|
|
|
7,778,633 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Cost of goods sold (excluding depreciation): |
|
|
|
|
|
|
|
|
|
|||
Fuel |
|
5,720,949 |
|
|
|
|
|
5,720,949 |
|
|||
Nonfuel |
|
738,871 |
|
|
|
|
|
738,871 |
|
|||
Total cost of goods sold |
|
6,459,820 |
|
|
|
|
|
6,459,820 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Site level operating |
|
815,611 |
|
|
|
|
|
815,611 |
|
|||
Selling, general & administrative |
|
106,823 |
|
|
|
|
|
106,823 |
|
|||
Real estate rent |
|
217,155 |
|
23,883 |
|
2(g) |
|
241,038 |
|
|||
Depreciation and amortization |
|
65,584 |
|
(10,593 |
) |
2(h) |
|
54,991 |
|
|||
Total operating expenses |
|
1,205,173 |
|
13,290 |
|
|
|
1,218,463 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Income from operations |
|
113,640 |
|
(13,290 |
) |
|
|
100,350 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Acquisition costs |
|
1,160 |
|
|
|
|
|
1,160 |
|
|||
Interest expense, net |
|
16,712 |
|
(5,887 |
) |
2(g) |
|
10,825 |
|
|||
Income before income taxes and income from equity investees |
|
95,768 |
|
(7,403 |
) |
|
|
88,365 |
|
|||
Provision for income taxes |
|
(38,023 |
) |
2,880 |
|
2(i) |
|
(35,143 |
) |
|||
Income from equity investees |
|
3,224 |
|
|
|
|
|
3,224 |
|
|||
Net income |
|
$ |
60,969 |
|
$ |
(4,523 |
) |
|
|
$ |
56,446 |
|
|
|
|
|
|
|
|
|
|
|
|||
Net income per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic and diluted |
|
$ |
1.62 |
|
$ |
(0.12 |
) |
|
|
$ |
1.50 |
|
TravelCenters of America LLC
Notes to Condensed Consolidated Pro Forma Financial Statements (Unaudited)
(In thousands except for per share data, unless indicated otherwise)
Note 1. Basis of Presentation
The condensed consolidated pro forma financial statements were derived from historical financial statements prepared in accordance with U.S. generally accepted accounting principles, and should be read in conjunction with our Annual Report and Quarterly Report. The pro forma financial statements are presented for informational purposes only and are not necessarily indicative of what our results of operations actually would have been had the transaction been completed as of the dates indicated. In addition, the pro forma financial statements do not purport to project our future operating results. The accompanying pro forma financial statements do not reflect adjustments related to the expected sale and lease back of the five properties we expect to sell to HPT after we have completed the construction of travel centers at those properties.
Note 2. Pro Forma Transaction Adjustments
The condensed consolidated pro forma financial statements were prepared based on our historical consolidated financial statements and include adjustments for our purchase of assets and our sale and lease back of assets on June 9, 2015 and June 16, 2015, as well as the additional sale and lease back of assets expected to occur prior to December 31, 2015.
The historical consolidated financial information of TA has been adjusted in the pro forma financial statements to give effect to events that are (1) directly attributable to the transactions, (2) factually supportable, and (3) expected to have a continuing impact on the results of operations. The pro forma statements of income do not reflect the one time transaction related expense adjustment described in note (f) below.
Pro Forma Balance Sheet Adjustments
(a) Cash
Adjustments to cash totaling $234,340 are comprised of proceeds from the sale to HPT of 14 travel centers and certain assets at 11 leased properties for $279,382, less the payment of $45,042 for the purchase of travel centers from HPT. The pro forma statements of income do not assume investment income related to the net increase in cash from the transactions.
(b) Property and equipment, net
Adjustments to property and equipment, net totaling $191,945 are to remove assets related to the sale of 14 travel centers and certain assets at 11 other travel centers to HPT for $142,785 as well as to remove $49,160 of assets related to travel centers that previously did not qualify for sale leaseback accounting under the Prior Lease but do so qualify under the Leases.
(c) Sale leaseback financing obligation
Adjustments to noncurrent HPT Leases liabilities totaling $84,777 consisted of the following:
Elimination of sale leaseback financing obligation liability related to the purchase of five formerly subleased properties |
|
$ |
(34,643 |
) |
Elimination of sale leaseback financing obligation liability related to the properties that now qualify for sale leaseback accounting but were not purchased or sold in the transactions |
|
(50,134 |
) |
|
|
|
$ |
(84,777 |
) |
(d) Deferred gain
In conjunction with the sale of 14 travel centers and certain assets at 11 other travel centers, and properties that now qualify for sale leaseback accounting, we recognized or will recognize after giving effect to and assuming completion of all the applicable transactions contemplated by the Transaction Agreement, an aggregate deferred gain of $138,448 which is to be amortized as a reduction to rent expense over the term of the respective leases on a straight line basis.
The deferred gain is comprised as follows:
Sale of 14 travel centers and certain assets at 11 other travel centers |
|
$ |
137,474 |
|
Properties that now qualify for sale leaseback accounting |
|
974 |
|
|
Total deferred gain |
|
138,448 |
|
|
Less: current portion of deferred gain |
|
(7,093 |
) |
|
Long term deferred gain |
|
$ |
131,355 |
|
(e) Asset retirement obligation
The adjustment to other noncurrent liabilities relates to the removal of asset retirement obligations related to assets sold to HPT totaling $877.
(f) Loss on extinguishment of debt
The purchase of five properties that we formerly leased from HPT and subleased to franchisees resulted in a loss on extinguishment of debt of $10,399 because the lease of these properties had been accounted for as a financing and the purchase prices paid for the properties exceeded the unamortized balance of the sale leaseback financing obligation. The $4,045 tax effect of this loss is reflected as a reduction in other noncurrent liabilities, while the after tax impact is reflected as a reduction to shareholders equity. This loss on extinguishment of debt is not reflected in the pro forma statements of income because it is non-recurring.
Pro Forma Statements of Income Adjustments
(g) Real estate rent
The increase in our base rent payable to HPT as a result of the sale and lease back and purchase transactions described above is calculated as follows:
Proceeds from the sales of 14 travel centers and certain assets at 11 properties |
|
$ |
279,382 |
|
Less: Purchase price of 5 travel centers |
|
(45,042 |
) |
|
Net proceeds from transaction |
|
234,340 |
|
|
Rent increase rate |
|
8.6 |
% |
|
Net increase in base rent |
|
$ |
20,153 |
|
Adjustments to real estate rent expense consisted of the following:
|
|
Three months ended
|
|
Year ended
|
|
||
Increase in base rent due to sales and lease back and purchase transactions |
|
$ |
5,038 |
|
$ |
20,153 |
|
Add: HPT rent previously classified as interest expense |
|
1,452 |
|
5,887 |
|
||
Add: HPT rent previously charged against the sale leaseback financing obligation |
|
636 |
|
2,380 |
|
||
Pro forma increase in real estate rent |
|
7,126 |
|
28,420 |
|
||
Less: Amortization of deferred gain |
|
(2,365 |
) |
(9,458 |
) |
||
Add: Amortization of other existing deferred rent credits over longer amended lease terms |
|
1,209 |
|
4,921 |
|
||
Net adjustment to real estate rent expense |
|
$ |
5,970 |
|
$ |
23,883 |
|
(h) Depreciation and amortization
Adjustments to depreciation and amortization expense in the pro forma statements of income consisted of the following:
|
|
Three months ended
|
|
Year ended
|
|
||
Adjustment to remove depreciation expense related to the assets sold to HPT |
|
$ |
(2,211 |
) |
$ |
(9,009 |
) |
Adjustment to remove depreciation expense related to properties that now qualify for sale leaseback accounting |
|
(412 |
) |
(1,584 |
) |
||
|
|
$ |
(2,623 |
) |
$ |
(10,593 |
) |
(i) Provision for income taxes
The pro forma transaction adjustments have been tax affected at a blended statutory federal and state income tax rate of 38.9%.