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Sale 1903

Petroleum Marketing Group, Inc. directs Sealed Bid Sale of

10 Convenience Stores with Gas & 4 Commercial/Retail Sites

New Jersey

Bid Deadline: March 28, 2019

Terms & Conditions of Sealed Bid Sale

SEALED BID SALE. Petroleum Marketing Group and its subsidiaries (“Seller”) is offering to sell fourteen (14) properties located in New Jersey (individually, a “Property” and collectively, the “Properties”) by sealed bid sale. Seller has retained NRC Realty & Capital Advisors, LLC (“NRC”) to coordinate the offering and sale of the Properties.

BID DEADLINE. Sealed bids are required to be received by NRC not later than March 28, 2019, at 3:00 p.m. Central Time (the “Bid Deadline”) and sent to:

NRC Realty & Capital Advisors, LLC
445 W. Erie, Suite 210
Chicago, IL 60654
ATTN: SEALED BID SALE 1903

OFFERED PROPERTIES.

CONVENIENCE STORE WITH GAS PROPERTIES. Nine (9) of the Properties are offered for sale as convenience stores with gas (individually, a “Gas Property” and collectively, the “Gas Properties”). All of the Gas Properties are currently operated by commission agents and are offered with the fee interest in the real property. All Gas Properties include non-proprietary furnishings and equipment owned by Seller, plus inventory (which is to be paid for separately as set forth below). Equipment leased by Seller or owned by third parties will not be sold with the Properties and will be removed prior to closing.

Gas Properties will be sold with ten-year fuel supply agreements and with fuel priced at rack plus two (2) cents per gallon plus freight and taxes. Terms and conditions of the fuel supply agreement will be subject to credit approval, and the amount and type of collateral (including a personal guaranty) that the Seller will require to be posted by the purchaser of the Property will be dependent upon the creditworthiness of the purchaser. Please see the Property Specific Package (“PSP”) for each Property for specific details and additional terms.

DEALER PROPERTIES. Seller is offering to sell one (1) company owned, dealer operated gas stations with convenience stores (individually, a “Dealer Property” and collectively, the “Dealer Properties”). Both of the Dealer Properties are currently operating and include the fee interest in the real property. All Dealer Properties include any improvements, fixtures and equipment owned by Seller (except as otherwise noted). Each Dealer Property includes an assignment of the dealer lease and fuel supply agreement at each location. Inventory will not be sold with Dealer Properties.

Dealer Properties will be sold with ten-year fuel supply obligations, with fuel priced at rack plus two (2) cents per gallon plus freight and taxes. Terms and conditions of the fuel supply agreement will be subject to credit approval, and the amount and type of collateral (including a personal guaranty) that the Seller will require to be posted by the purchaser of the Property will be dependent upon the creditworthiness of the purchaser. Please see the Property Specific Package (“PSP”) for each Property for specific details and additional terms.

COMMERCIAL PROPERTIES. Two (2) of the Properties are offered for sale as former gas stations and another two (2) are offered for sale as convenience store only (individually, a “Commercial Property” and collectively, the “Commercial Properties”). All Commercial properties are offered with the fee interest in the real estate. Any previous underground storage tank systems have been removed at the Commercial Properties that were former gas stations. All Commercial Properties include any improvements, non-proprietary furnishings and equipment owned by Seller.

The former gas station Commercial Properties are offered subject to a deed restriction prohibiting the use of the Property for the sale of petroleum products and other institutional and engineering controls. Please see the Purchase and Sale Agreement (“PSA”) for additional information. Seller will remove the deed restriction if a purchaser wants to install underground storage tank systems at the Property provided that the purchaser will agree to a fuel supply agreement under the terms listed in the Gas Properties section above.

Please see the Property Specific Package (“PSP”) for each Property for additional terms.

TERMS AND CONDITIONS OF SEALED BID SALEe

TERMS AND CONDITIONS. The offering and sale of the Properties in this sealed bid sale are subject to these Terms and Conditions of Sealed Bid Sale (the “Terms and Conditions”). Prospective bidders are advised to carefully review the Terms and Conditions. Failure to comply either as a participant in the sale or in the preparation or submission of a sealed bid, may, in the sole discretion of Seller or NRC with Seller’s consent, cause a sealed bid to be deemed non-conforming (a “Non-conforming Bid”) and disqualified from consideration. NRC and Seller reserve the right to amend, supplement or modify these Terms and Conditions from time to time, without consent from or notice to prospective bidders. In the event the Terms and Conditions conflict with a provision of the Purchase and Sale Agreement (“PSA”) relating to a Property, the provision of the applicable PSA shall be controlling.

REFERENCED MATERIALS. The Terms and Conditions are set forth in three places in the sealed bid sale materials; (i) on the NRC website at http://www.nrc.com/1903 and (ii) in each PSP, and are incorporated by reference in each PSA.

CONFIDENTIALITY AGREEMENT. Certain information that prospective bidders may receive in connection with this sealed bid sale is proprietary and non-public information that Seller considers confidential (“Confidential Information”), including, without limitation, Confidential Information contained in a PSP. Accordingly, each prospective bidder is required to sign and return a Confidentiality Agreement (“Confidentiality Agreement”) to NRC by mail or fax prior to receiving a PSP. A Confidentiality Agreement is available for download on the NRC website at http://www.nrc.com/1903 or by calling NRC.

CREDIT PROCESS. Each prospective bidder who intends to submit a sealed bid for any Property is required to fully complete, sign and return to NRC a financial prequalification form with their bid. A prequalification form is included with the Bid Package (as defined below) contained in the PSP. Successful bidders for Properties sold with fuel supply will be required to complete Seller’s and/or Seller’s gas supplier’s credit processes prior to completing the purchase of their Properties.

DUE DILIGENCE

PRE-BIDDING DUE DILIGENCE. Bidders are solely responsible for conducting their own due diligence on Properties prior to bid submission. PSAs submitted as sealed bids become immediately enforceable by the parties upon Seller’s execution and may be terminated only pursuant to the terms thereof. In the event a successful bidder defaults on its obligations under an enforceable PSA, Seller may have the right to retain such bidder’s Earnest Money Deposit (defined below).

PROPERTY SPECIFIC PACKAGES. A PSP for each Property is available for download at http://www.nrc.com/1903. Each PSP contains, as available, property-specific physical, legal, environmental and financial due diligence information. A PSP may include, as applicable, tax bills, surveys or site plans, title commitments, UST information and remediation reports.

PROPERTY INSPECTIONS. Properties that are currently operating may be inspected during normal business hours from 8:30 a.m. to 5:00 p.m. local time, Monday through Saturday. UNDER NO CIRCUMSTANCES MAY BIDDERS ASK QUESTIONS OF STORE MANAGERS OR STORE EMPLOYEES. BIDDERS VIOLATING THIS REQUIREMENT MAY BE DISQUALIFIED FROM BIDDING. The store managers and employees have been instructed to refer any questions from a bidder directly to NRC. All pre-bid inspections are limited to non-invasive investigations. Please call NRC at (800) 747-3342, ext. 1903 for further information or to arrange to visit the closed Properties.

SEALED BID SUBMISSION

BID DEADLINE. Each sealed bid is required to be received by NRC as provided above by the Bid Deadline. A sealed bid received by NRC after the Bid Deadline is a Non-conforming Bid.

BID PACKAGE. The bid package (the “Bid Package”) for a Property contains bid submission instructions, the related PSA to be completed, signed and submitted with the sealed bid, and a pre-qualification form to be submitted to NRC. The Bid Package for each Property is contained in or sent with the related PSP. To obtain a Bid Package for a Property, a prospective bidder is required to order the related PSP from NRC.

PURCHASE AND SALE AGREEMENT. A sealed bid for a Property is made on the PSA contained in the related Bid Package. The PSA is required to be fully and correctly completed, without any modification and properly signed. A sealed bid received in any other format or on a PSA that is incomplete, incorrect or modified in any respect is a Non-conforming Bid. Instructions on how to complete the PSA in compliance with the Terms and Conditions are contained in the Bid Package.

BID DEPOSIT. Each sealed bid is required to include an initial bid deposit (the “Bid Deposit”) equal to the greater of 2.5% of the bid price indicated on the accompanying PSA or $10,000. The Bid Deposit is required to be made by wire transfer to NRC Realty & Capital Advisors, LLC’s escrow account (wire instructions are included in the Bid Package). A sealed bid that is submitted without a Bid Deposit that complies with this paragraph is a Non-conforming Bid. If a bid is not accepted by Seller, the Bid Deposit will be returned to the bidder subject to the terms outlined below.

NON-CONFORMING BIDS. NRC reserves the right, with Seller’s consent, to disqualify from consideration and reject any Non-conforming Bid. After a Non-conforming Bid is rejected, NRC will return the related Bid Deposit by certified mail within seven (7) business days after the later to occur of (i) the date of such rejection and (ii) the date that the related funds have cleared NRC’s escrow account.

SEALED BID EVALUATION AND AWARD

EVALUATION AND AWARD OF SEALED BIDS. NRC will present all sealed bids received by the Bid Deadline to Seller for consideration. Seller will review all sealed bids, other than rejected Non-conforming Bids. Seller may accept or reject sealed bids, in its sole and absolute discretion. Seller and NRC reserve the right to request and review additional financial information relating to a bidder and/or other information confirming a bidder’s ability to close a sale. All sales are final upon acceptance and execution by Seller of the related PSAs. Seller shall attempt to accept or reject all bids within twenty (20) business days of the Bid Deadline, after which initial bid deposits shall be returned to unsuccessful bidders.

BEST AND FINAL BIDS. Seller reserves the right to solicit a best and final offer (“BAFO”) for any Property. NRC shall notify bidders of Seller’s intent to solicit a BAFO by facsimile. In that case, bidders will be given an opportunity to raise, but not lower or withdraw, their bids. If a bidder elects not to submit a BAFO, such bidder’s original bid amount remains in effect. If accepted by Seller, a BAFO will amend the purchase price of the related PSA.

PROHIBITION ON WITHDRAWING SEALED BIDS. Both sealed bids and BAFOs are purchase offers that, pursuant to this paragraph, remain in effect for a period of twenty (20) business days following the Bid Deadline, in the case of sealed bids, and twenty (20) business days following the date the BAFO is received by NRC, in the case of BAFOs. Sealed bid and BAFO purchase offers during such periods are irrevocable and may not be withdrawn.

EFFECTIVE DATE OF AWARD OF BID. The effective date of the award of a sealed bid is the date on which Seller signs the related PSA. NRC will notify successful bidders of awards by facsimile; however, the awards are not legally binding or enforceable until the date on which Seller delivers a fully signed PSA to the successful bidder.

ADDITIONAL EARNEST MONEY REQUIREMENT. Within two (2) business days after receiving written notice from NRC of Seller’s acceptance of a sealed bid, a successful bidder is required to deposit sufficient additional funds (the “Additional Bid Deposit”) that, when added to the initial Bid Deposit, equals the greater of 10% of the purchase price of the accepted sealed bid or $25,000. The Additional Bid Deposit is required to be made by wire transfer of immediately available funds to NRC’s escrow account (wire instructions will be provided by NRC). The Bid Deposit, together with the Additional Bid Deposit, is collectively referred to herein as the “Earnest Money Deposit”. The Earnest Money Deposit will be held by NRC for the benefit of the parties and without obligation to invest funds. NRC reserves the right to allocate any of a bidder’s excess Bid Deposits on other Properties to the Earnest Money Deposit of an accepted sealed bid in connection with satisfying the Additional Bid Deposit requirement of this paragraph.

SELLER’S RESERVATION OF RIGHTS. Seller expressly reserves the right, in its sole discretion, at any time and without giving reasons therefor, to decline any bid, postpone, extend, or cancel the Bid Deadline, or withdraw any Property from the sealed bid sale at any time without notice. Seller further reserves the right, in its sole discretion, without notifying any bidder, giving any bidder similar opportunity, or re-offering a Property, to negotiate the terms of a bid, to overlook minor inconsistencies or nonconformance in a bid, to extend any deadlines or to accept any bid for any reason, whether or not such bid is the highest purchase price. Seller also reserves the right to terminate, at any time, further participation in the process by any party or all parties, to modify any of the rules or procedures set forth herein or any other procedures without prior notice or assigning any reason therefor, to reject any or all proposals, or to terminate the process contemplated hereby. Seller reserves the right to take any action, whether in or out of the ordinary course of business, which Seller, in its sole discretion, deems necessary or prudent in the conduct of its business. Seller may require verification of funds available to close on offers before accepting any bid. The Terms and Conditions are subject to modification as may be required by the laws of the State of New Jersey.

PURCHASE AND SALE AGREEMENT TERMS

PURCHASE AND SALE AGREEMENT. The purchase of each Property will be subject and consummated pursuant to the provisions of the applicable PSA. Certain PSA provisions have been summarized herein for the benefit of prospective bidders, including, without limitation, certain environmental terms. These summaries do not restate the PSA provisions and are not intended to be full, complete and accurate descriptions thereof. Accordingly, bidders may not rely on these summaries as enforceable provisions. The applicable PSA is the sole agreement relating to rights, remedies and obligations of each party in connection with the purchase of a Property.

CLOSING DATES AND TRANSFER OF POSSESSION – Gas properties and commercial properties. Successful bidders for Gas Properties and Commercial Properties will be required to close escrow within sixty (60) days. Seller shall have the sole option of extending the closing date for as many as ninety (90) days if it finds it necessary. Transfer of possession will occur upon the escrow closing. The PSA for each Property provides that Central Jersey Title Co., Inc. will be the escrow agent for the closing of the Property. In the event that Purchaser requests to use a different title company and Seller consents, Purchaser shall be required to pay to Seller an additional $10,000 at closing.

TERMS SPECIFIC TO DEALER PROPERTIES BEING OFFERED

PROPERTIES ARE TO BE SOLD SUBJECT TO EXISTING DEALERS. Dealer Properties will be sold subject to the existing dealer lease and fuel supply agreement along with all other agreements between the applicable dealer and Seller (the "Dealer Agreements").  In addition, Seller will provide a dealer with a right of first refusal ("ROFR") to purchase the related Dealer Property in accordance with the Petroleum Marketing Practices Act ("PMPA") or any State statute. A condition precedent to the consummation of the sale of that Dealer Property is that the then-current dealer must decline to exercise its ROFR or fail to consummate the acquisition of the property in accordance with the ROFR.  For Dealer Properties, Seller owns the fee interest in the real estate (as applicable), and owns the underground storage tanks, fuel dispensers, canopies, buildings, and certain other fixtures and equipment.  Any equipment, fuel storage inventory or other items owned by the dealer are not being offered for sale in the bid process, and bids should not refer to those items.

CLOSING DATES AND TRANSFER OF POSSESSION FOR DEALER PROPERTIES. If the dealer declines to exercise the ROFR or if the dealer fails to consummate the acquisition of such Property in accordance with the ROFR, a successful bidder for a Dealer Property will be required to close escrow forty-five (45) days after the expiration of the ROFR period. Upon the close of escrow, the then-current dealer will continue in possession of the Dealer Property under the existing Dealer Agreements until the expiration or non-renewal of the Dealer Agreements subject to any dealer rights under the PMPA, and Seller will assign all Dealer documents to the Purchaser at closing.

TRANSFER OF TITLE. All Properties will be conveyed by special or limited warranty deed with marketable title. Seller will provide title free and clear of monetary liens, except non-delinquent real estate taxes, and subject to standard permitted exceptions outlined in the title commitment. The Purchaser will pay for title insurance coverage. Real estate taxes will be current to the date of closing. Except as stated in the paragraph below entitled “ENVIRONMENTAL MATTERS”, all Properties will be conveyed “AS IS, WHERE IS, WITH ALL FAULTS,” regarding any conditions affecting the Properties, with no representations or warranties.

NO MORTGAGE CONTINGENCY. The PSAs for the Properties do not contain a mortgage contingency. In the event that the Purchaser is unable to secure purchase financing, the PSA may not be terminated on that basis.

LICENSES, PERMITS AND AUTHORIZATION. It is the Purchaser’s sole responsibility to obtain, at its expense, any licenses, permits and authorizations (collectively, “Licenses”) required to acquire, manage, develop, lease and/or operate a Property. Purchaser’s procurement of these items is not a condition to Closing. Please see the PSP for each Property for additional information.  

ESTIMATED INVENTORY VALUE.  For the Gas Properties, Purchaser will purchase non-petroleum and petroleum inventory, as applicable and less any Seller proprietary items or dealer inventory (the “Inventory”) located at the Properties from Seller at closing. The Purchase Price for a Property does not include the Inventory items, and Inventory shall be paid for separately by Purchaser. Not less than seven (7) days prior to the closing date for all sites where Inventory is being transferred, NRC shall deliver by facsimile or e-mail to Purchaser an estimated value of the Inventory (the “Estimated Inventory Value”). Purchaser shall deposit with NRC one hundred ten percent (110%) of the Estimated Inventory Value at least five (5) days prior to the closing date by wire transfer of immediately available funds (the “Inventory Deposit”). Failure to make the Inventory Deposit as set forth herein shall be considered a default under the PSA and may result in the forfeiture of the Earnest Money Deposit, in Seller’s complete and sole discretion.

ACTUAL INVENTORY VALUE.  Where applicable, a physical count of the Inventory on hand at the Property (the “Inventory Review”) shall be conducted by a third party servicer designated by Seller at closing. Purchaser is required to purchase at closing the entire Inventory unless otherwise agreed by Seller. The cost of the Inventory Review shall be divided equally between the parties. On the day after closing, the third party servicer will perform the Inventory Review and then calculate the purchase price of the Inventory as set forth in the PSA. Any difference between the Estimated Inventory Value and the final value of Inventory, as determined by the Inventory Review (the “Final Inventory Purchase Price”) may result in additional amounts due from Seller or Purchaser, as the case may be. The appropriate party must remit such additional amounts within two business days following final determination. See the PSA for specific details. Inventory shall not include any out-of-code or damaged merchandise and Seller shall remove all out-of-code or damaged merchandise prior to conclusion of the physical inventory at the Property.

DE-IDENTIFICATION. Prior to closing, Seller shall, as it deems necessary and/or appropriate, in its sole discretion, remove from the Properties, signage, advertising and other displays on or in the Properties, including on or in the buildings comprising or underlying the Properties, containing any of Seller’s trade names, trademarks or other intellectual property owned or licensed by Seller. Proprietary back office computers, POS systems and proprietary equipment may also be removed by Seller prior to closing.

BROKER PARTICIPATION. A fee equal to two percent (2%) of the purchase price of each fee Property will be paid by NRC upon the closing of escrow of the sale of such Property pursuant to the PSA to any licensed broker or agent whose registered prospect consummates the sale. A broker who REPRESENTS a current Dealer or commission agent oF a Property will not be eligible for this fee. Brokers must register their prospect(s) with NRC no less than three (3) days prior to the Bid Deadline by completing the Co-Op Broker registration in the form provided by NRC without modification, and faxing it to NRC at (312) 278-6900, referencing Sale 1903. All such Co-Op Broker registrations are not effective until accepted in writing by NRC and NRC shall have the authority to determine if any registration is accepted based upon the requirements of these Terms and Conditions and the Co-Op Broker registration document, in its sole judgment. No registration will be accepted by NRC and no commissions will be paid in connection with any prospect who has previously expressed interest in the Property with Seller or its agents or who has been contacted by NRC. No commissions will be paid on any Property to any broker participating as a principal in the purchase of the Property or who has a direct or indirect ownership interest in purchaser, and an affidavit may be required stating that the broker is acting solely as broker and not as purchaser and has no direct or indirect ownership interest in purchaser. NO OTHER FORM OR ORAL REGISTRATION IS PERMITTED.

DUAL AGENCY ACKNOWLEDGMENT, CONSENT AND WAIVER. NRC is acting as the marketing and sealed bid sale coordinator for Seller in connection with any offering or sale of Properties pursuant to these Terms and Conditions and in no event is NRC representing Purchaser as its agent in connection with any transaction contemplated or consummated in connection herewith. Notwithstanding the immediately preceding sentence, if it is determined that NRC is acting as an agent for Purchaser hereunder, Purchaser and all parties claiming by, through or under Purchaser shall hereby affirm and acknowledge that NRC is not acting in any manner which shall result in a dual agency, and Purchaser hereby consents to all such actions of NRC and disclaims, waives and forever releases NRC from any and all obligations that might be imposed on an agent in connection with any transaction hereunder and Purchaser hereby consents to same. Purchaser further disclaims, waives, forever releases indemnifies and holds Seller harmless from any liability, loss, cost or obligation arising from any acts or omissions of NRC.

ENVIRONMENTAL MATTERS. Responsibility for environmental liabilities and indemnification for environmental matters for each Property is allocated as of closing as provided in the PSA for that Property. For a Property where either no known contamination exists or a “No Further Action” letter or similar document has been issued, the purchaser will be purchasing such Property on an “AS IS, WHERE IS” basis. For a Property where known contamination exists, the purchaser will be purchasing such Property on an “AS IS, WHERE IS” basis, except Seller will retain responsibility for remediating in accordance with applicable law the environmental condition reflected in the most recent environmental report(s) obtained by Seller with respect to such condition, which report(s) will be made part of the PSA. Please see the website or PSP for each Property for additional information.

DISCLAIMER. Seller and NRC and their respective members, directors, officers, employees, agents, parents, subsidiaries and affiliates (collectively, “Representatives”) disclose that they may not have complete knowledge of the physical, environmental or economic characteristics of the Properties. Accordingly (except as otherwise specifically stated in a PSA), Seller and NRC and their Representatives disclaim any warranty, guaranty or representation, express or implied, concerning (a) the condition or state of repair of the Properties, including, without limitation, any condition arising in connection with the generation, use, transportation, storage, release, or disposal of petroleum products, toxic or hazardous substances, on and under, above, upon, or in the vicinity of the Properties, and its impact on water, soil and geology; (b) the suitability of the Properties and their water, soil and geology for any activities and use that the purchaser may elect to conduct; (c) the extent of any right of way, lease, possession, lien, encumbrance, easement, license, reservation, or condition in connection with the Properties; (d) the compliance of the Properties or their operation with any applicable laws, ordinances, or regulations of any government or other body, including without limitation, compliance with any land use, Americans with Disabilities Act, wetland, or zoning law or regulation, or applicable environmental or coastal laws, rules, ordinances, and regulations; (e) title to or the boundaries of the Properties; and (f) the physical condition of the Properties, including, without limitation, the structural, mechanical and engineering characteristics of the improvements to the Properties.

Except as stated above and as set forth in the related PSA, the sale of each Property is on an “AS IS, WHERE IS, WITH ALL FAULTS,” basis. Neither Seller, NRC, nor any of their Representatives make any warranty or representation, express or implied, or arising by operation of law, including, without limitation, any warranty of condition, habitability, or merchantability or fitness for a particular purpose, with respect to the Properties. Bidders will buy the Properties based solely on their own investigations. By accepting title to any Property, a bidder acknowledges that it has conducted any investigation that it has considered necessary or advisable and that it is not relying upon any representations of Seller, NRC or any of their Representatives. The materials and information concerning the Properties contained in the sales mailer, postcards, other brochures, the PSP and the Bid Package, and any other information provided by Seller or NRC or their Representatives, is based in part upon information and materials obtained from sources considered reliable, without independent verification. Bidders must not base their bids upon that information or environmental studies, repair estimates, other studies, or pro-forma and financial information that Seller or NRC provides, but must rely solely on their own estimates and studies. No warranty or representation, express or implied, is made by Seller, NRC, or any of their Representatives, as to the accuracy or completeness of the information provided to bidders.