EXHIBIT 2.1
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ASSET
PURCHASE AGREEMENT
AMONG
IMAGINATION PLUS CHILD DEVELOPMENT CENTER, INC.
AND
CHILDREN, S WONDERLAND, INC.
AUGUST I, 1997
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is entered into effective as of
August 1, 1997 by and among IMAGINATION PLUS CHILD DEVELOPMENT CENTER, INC., a
California corporation ("Purchaser"), on the one hand, and CHILDREN'S
WONDERLAND, INC., a California corporation, (hereinafter "Seller").
RECITALS
A. Seller is the owner and operator of certain licensed child care centers
located in California and Colorado which do business under the name "Children's
Wonderland, Inc." at the California locations listed on Schedule A-1 attached
hereto ("California Centers") and the Colorado locations listed on Schedule A-2
attached hereto ("Colorado Centers").
B. Purchaser desires to purchase, and Seller desires to sell to Purchaser,
all upon the terms and conditions hereinafter set forth, all of the business,
properties and assets of the California Centers and the Colorado Centers.
NOW, THEREFORE, in consideration of the mutual promises hereinafter set
forth and for other good and valuable consideration had and received, the
parties agree as follows:
ARTICLE I
TRANSFER OF ASSETS. ASSUMPTION OF LIABILITIES
1.1 TRANSFER OF ASSETS. On the terms and subject to the conditions in this
Agreement and on the Closing Date (as hereinafter defined), Seller will convey,
transfer, assign and deliver to Purchaser all of the business, properties and
assets of the California Centers and the Colorado Centers, wherever located,
tangible or intangible, (collectively, the "Subject Assets") with the exception
of the "Excluded Assets" as defined in Section 1.2 below. For purposes of this
Agreement, the California Centers and the Colorado Centers are hereinafter
sometimes collectively referred to as the "Centers".
Without limiting the generality of the foregoing, the Subject Assets
shall include:
(a) all personal property, inventory, and equipment in accordance with
lists previously furnished to Seller, and vehicles described on Schedule 1.1
located at or relating to the business of each of the Centers;
(b) all of Seller's interest in all real property leases;
(c) all customer lists, student contracts, toys and games and teaching
materials and related aids not proprietary to Seller located and/or used at each
of the Centers;
(d) all books and records, including all computer programs (with the
exception of the software known as "office center"), relating to the Seller's
business at each of the Centers;
(e) all accounts receivable attributable to the Centers after the
Closing Date and prepaid deposits for services after the Closing Date;
(f) the goodwill of the business for each of the Centers except that
Purchaser shall have no right to use the name Children's Wonderland in
connection with the operation of the Centers.
1.2 EXCLUDED ASSETS. There shall be excluded from the Subject Assets being
purchased hereunder all of the following assets of Seller as of the Closing (the
"Excluded Assets"). Seller's cash, and accounts receivable attributable to
services provided by Seller prior to the Closing Date, and those assets, if any,
listed on Schedule 1.2.
1.3 ASSUMPTION OF LIABILITIES. Purchaser shall assume and be responsible
for only those obligations and liabilities of Seller listed in Schedule 1.3 (the
"Assumed Obligations"). Purchaser has negotiated or will seek to negotiate new
real estate lease agreements for any or all of the Centers, provided however, in
the event new lease agreements cannot be consummated to Purchaser's
satisfaction, Purchaser agrees to accept an assignment of the leases in their
present condition. Seller agrees to cooperate with Purchaser in obtaining each
Landlord's consent to an assignment of the respective leases. Seller will
continue to be responsible for all of its obligations and liabilities, except
for the Assumed Obligations, whether they are known or unknown and whether they
arise prior to, in connection with, or subsequent to the Closing Date and Seller
will promptly pay and perform each such obligation and liability as it becomes
due ("Seller's Obligations"). Without limiting the generality of the foregoing,
Seller's obligations shall include any and all problems, complaints and/or
credits relating to Seller's operation of the Centers prior to the Closing Date.
Purchaser will use reasonable efforts to assist Seller in resolving any and all
such issues at Seller's expense.
1.4 METHOD OF CONVEYANCE AND TRANSFER OF SUBJECT ASSETS. The conveyance,
transfer and delivery of the Subject Assets will be effected by appropriate
bills of sale, endorsements, transfers, assignments and other instruments, all
in such form as Purchaser reasonably requests, vesting in Purchaser, or any
designated affiliate of Purchaser, good and marketable title to the Subject
Assets, free and clear of any and all covenants, agreements, leases, conditions,
easements, liens, charges, security interests, title retention instruments,
adverse claims or interests, or other title defects, contractual defaults or
restrictions of any kind or nature whatsoever except for the Assumed Liabilities
(collectively, "Liens").
1.5 FURTHER ASSURANCES. Seller, at any time and from time to time after the
Closing Date, upon request of-Purchaser, will do, execute, acknowledge and
deliver, all such further acts, assignments, transfers, conveyances, powers of
attorney and assurances as may be reasonably required for the better conveying,
transferring, and delivering to Purchaser, or to its successors and assigns, and
for aiding and assisting in collecting and reducing to possession, all the
Subject Assets.
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1.6 ACCOUNTS RECEIVABLE. Accounts receivable of Seller for services
provided up to the Closing Date shall remain the property of Seller, and shall
be fully billed by Seller on or immediately after the Closing Date. Purchaser
shall have no responsibility for the collection of Seller's accounts receivable;
provided, however, that all accounts receivable received by Purchaser after the
Closing Date relating to services performed by Seller up to the Closing Date
shall immediately upon the receipt thereof be paid by Purchaser to Seller.
1.7 EMPLOYEES. Seller acknowledges and agrees that as of the Closing Date,
Seller will no longer be conducting the Seller s business at the location of the
Centers. Prior to the Closing Date, Seller will notify all of the employees
engaged on a full or part time basis at any of the Centers, that their
employment with Seller in connection with the Centers will end as of the Closing
Date. Seller agrees that on or prior to the Closing Date it will pay or have
paid all compensation and benefits (including all accrued sick leave, vacation
pay and severance pay) owing to such employees through the Closing Date. Seller
shall be responsible for giving any and all notices and complying with the
provisions of the Worker Adjustment and Retraining Notification Act, if
applicable. Purchaser shall have the right (but not the obligation) to hire any
or all of Seller's employees who work at the Centers and Seller shall assist
Purchaser in doing so.
ARTICLE II
PURCHASE PRICE AND PAYMENT; CLOSING
2.1 PURCHASE PRICE. As the entire consideration for the transfer and
assignment by Seller of the Subject Assets, for the assumption by Purchaser of
the Assumed Obligations and for the representations, warranties and covenants of
Seller set forth herein, Purchaser, subject to the conditions set forth herein,
shall pay to Seller the amount of Six Hundred Seventy Five Thousand and One
Dollar (($675,001) in good funds. Of this amount, Six Hundred Seventy Five
Thousand Dollars ($675,000) is allocated to the acquisition of the California
Centers and One Dollar ($1) is allocated to the acquisition of the Colorado
Centers. Should the acquisition of the California Centers and Colorado Centers
occur on different Closing Dates, the amount of the cash consideration allocated
to each group of Centers shall be paid at the respective Closing.
Notwithstanding anything contained herein to the contrary, the consideration
payable by Purchaser to Seller for the California Centers shall be in the form
of (a) the cancellation of all indebtedness and obligations of Seller owing to
Purchaser under that certain Promissory Note, of even date, in the face amount
of $300,000.00 (regardless of the amount of interest accrued thereon), and
related Security Agreement ("Seller Loan") and (b) the disbursement to Seller of
the sum of $375,000 from the Client Trust Account ("Client Trust Account") of
the law firm representing Purchaser in this transaction, i.e., Buchalter, Nemer,
Fields & Younger whose address is set forth in Article X hereinbelow. Upon the
mutual execution hereof, Seller will deposit the sum of $675,001.00 into the
Client Trust Account, $300,000 of which will be used to fund the Seller Loan in
accordance with Section 6.4 hereinbelow.
2.2 SEPARATE CLOSING. Subject to satisfaction of all conditions precedent
and terms set forth in -this Agreement, the Closing related to the acquisition
of the California Centers shall occur as soon as possible but in no event later
than one (1) business day following the date upon which the California
Department of Social Services issues licenses to operate the California Centers
in the name of Purchaser, and the Closing related to the acquisition of the
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Colorado Centers shall occur as soon as possible but in no event later than one
(1) business day following the date upon which the Colorado equivalent of the
California Department of Social Services issues licenses to operate the Colorado
Centers in the name of Purchaser. The Purchaser may not acquire the California
Centers without the Colorado Centers, or the Colorado Centers without the
California Centers, without the prior written consent of Seller. At each
Closing, Seller shall authorize the conveyance of all Subject Assets related to
the respective acquired Centers and will deliver all documents related to such
acquisitions called for by this Agreement. All taxes, pre-paid rents, and
utility charges applicable to the Centers shall be pro-rated as of the date of
closing for such Center.
2.3 [Intentionally Omitted].
2.4 ALLOCATION OF PURCHASE PRICE. Purchaser will allocate the Purchase
Price among the Subject Assets and the Assumed Obligations in accordance with
Section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"),
based on the reasonable fair market value of each asset and the liabilities to
be assumed. Purchaser will advise the Seller of the allocations when determined.
Purchaser and Seller will each attach a copy of such information or forms as are
required to be filed pursuant to Section 1060 of the Code to the tax returns
filed covering the period in which the transfer of the Subject Assets and the
Assumed Obligations occurs. Seller and Purchaser will report the sale and
purchase of the Subject Assets and the assumption of the Assumed Obligations in
accordance with the allocations determined by Purchaser for all federal, state
and local tax purposes. Seller, and Purchaser, on the other hand, will indemnify
and hold each other harmless, from and against any and all losses, liabilities
and expenses, including, without limitation, attorneys' fees and additional
income taxes, interest and penalties that may be incurred by the indemnified
party as a result of the failure of the indemnifying party to so report the sale
and purchase of the Subject Assets and the assumption of the Assumed
Obligations.
2.5 TRANSFER TAXES. All applicable sales, use and transfer taxes, if any,
arising by reason of the transfer of the Subject Assets and the assumption of
the Assumed Obligations under this Agreement will be borne by Seller.
2.6 CLOSING. The closing of the transactions contemplated by this Agreement
(the "Closing") will take place at the offices of Buchalter, Nemer, Fields &
Younger, 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000,
on the dates specified in Section 2.2 hereinabove or such other date and time
mutually agreeable to the parties (the "Closing Date"). If the sale and purchase
of the California Centers and the Colorado Centers occurs on different dates,
then the date for each sale shall be considered to be the Closing Date for
purposes of all provisions of this Agreement. Should the sale of the California
and/or the Colorado Centers not close by October 1, 1997, then the Seller may in
its sole discretion terminate this Agreement upon written notice to Purchaser;
provided, however, that upon such termination as to the California Centers the
Seller Loan shall automatically accelerate and become due and payable.
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ARTICLE III
REPRESENTATIONS, WARRANTIES OF SELLER
Seller, represents and warrants to Purchaser as of the date hereof and as
of the Closing Date as follows:
3.1 ORGANIZATION AND STANDING. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of California
and is in good standing and qualified to conduct its business in the State of
Colorado. Seller has full power and authority to carry on the Seller's business
at each of the Centers as and where conducted and to own or lease and operate
the Subject Assets at and where owned or leased and operated by it. Seller is
duly licensed and qualified and is in good standing in the States of California
and Colorado, which constitutes the only jurisdiction m which the conduct of the
Seller's business at the Centers and the nature of the Subject Assets requires
the Seller to be so qualified.
3.2 AUTHORITY OF SELLER; CONSENTS. The execution, delivery and consummation
of this Agreement by Seller has been duly authorized in accordance with all
applicable laws and the Articles of Incorporation and Bylaws of the Seller, and
as of the Closing Date no further corporate action will be necessary on the part
of the Seller or the Board of Directors or shareholders of Seller to make this
Agreement valid and binding on Seller and enforceable against Seller in
accordance with its terms (subject to bankruptcy, insolvency, reorganization and
other similar laws affecting creditors' fights generally and to
genera/principles of equity). The execution, delivery and consummation of this
Agreement by Seller (i) does not violate the Articles of Incorporation or Bylaws
of Seller, (ii) does not now and will not, with the passage of time, the giving
of notice or otherwise, result in a violation or breach of, or constitute a
default under, any term or provision of any mortgage, deed of trust, lease,
instrument, order, judgment, decree, rule, regulation, law, contract, agreement
or any other restriction to which Seller is a party or to which the Seller or
any of its respective assets are subject or bound, (iii) will not result in the
creation of any Lien upon any of the Subject Assets, and (iv) will not result in
any acceleration or termination of any loan or security interest agreement to
which Seller is a party or to which Seller or any of its respective assets are
subject or bound. No approval or consent of any person, firm or other entity or
governmental body is or was required to be obtained by Seller for the
authorization of this Agreement or the consummation by Seller of the
transactions contemplated in this Agreement.
3.3 TITLE TO ASSETS; CONDITION OF ASSET. Seller owns and possesses, and
will own and possess as of the Closing Date, all right, title and interest in
and to the Subject Assets free and clear of any and all Liens, with the
exception of the Assumed Obligations. Seller has and will have as of the Closing
Date the right, power and capacity to sell, convey, transfer, assign and deliver
to Purchaser the Subject Assets free and clear of any and all Liens, with the
exception of the Assumed Obligations. All tangible assets included in the
Subject Assets are in Seller's possession or under its control.
3.4 FINANCIAL STATEMENTS. Prior to the date of this Agreement, Seller
provided Purchaser with the profit and loss statements relating to each of the
Centers and covering the period July 31, 1996 through and including May 31,
1997, (collectively, the "Financial Statements"). The Financial Statements (i)
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have been prepared in accordance with generally accepted accounting principles
which have been applied on a consistent basis during the periods involved, (ii)
present fairly the operations of the business of the Centers, and results of its
operations, and (iii) are consistent with the books and records of Seller.
3.5 ABSENCE OF CERTAIN CHANGES. Since May 31, 1997 (the "Balance Sheet
Date") and except as otherwise disclosed by Seller to Purchaser in writing: (i)
there has not been any material adverse change in the business or in the
condition (financial or otherwise), assets, liabilities, results of operations
or prospects of the Seller's business conducted at the Centers, and (ii) there
has not occurred any event or governmental regulation or order which could cause
such a change, nor, to the knowledge of Seller, is the occurrence of any such
event, regulation or order threatened. Without limiting the generality of the
foregoing, since the Balance Sheet Date there has not been:
(a) any mortgage or pledge of, or any other lien, charge or
encumbrance of any kind, on any of the Subject Assets;
(b) any sale or transfer of any assets, including the Subject Assets,
or settlement, cancellation or release of any indebtedness owing to Seller in
connection with the Seller's business as conducted at the Centers;
(c) any material amendment or termination of any contract, agreement
or license, to which Seller is a party in connection with the Seller's business
or to which Seller or any of the Subject Assets are subject or bound;
(d) any commitment made (through negotiations or otherwise) or any
liability incurred to any labor union or similar organization of employees by
Seller;
(e) any institution by Seller of a bonus, stock option,
profit-sharing, pension plan or similar arrangement or any material changes in
any such existing plans;
(f) any change in compensation, wages or benefits paid or payable to
any employee of Seller who are involved in the business of the Centers;
(g) any material adverse change in collection loss experience related
to the accounts receivable arising from Seller's business conducted at the
Centers;
(h) any material loss, damage or destruction to the Subject Assets
(whether or not covered by insurance);
(i) any discharge or satisfaction by Seller of any lien, encumbrance,
obligation or liability (accrued, absolute, fixed or contingent) other than
those incurred in connection with the ordinary course of operations of the
Seller's business; or
(j) any transaction outside of the ordinary course of Seller's
business related to the business of the Center.
3.6 ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth on the Balance
Sheet and trade payables incurred by Seller subsequent thereto in the ordinary
course of business, including the Assumed Obligations, Seller is not obligated
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for, nor are any of the assets or properties of Seller comprising the Subject
Assets subject to, any liabilities or adverse claims or obligations (whether
accrued, absolute, contingent or otherwise). There are no facts known to Seller
that might reasonably serve as a basis, in whole or in part, for any liabilities
or obligations not disclosed in this Agreement or in the Financial Statements,
or in the information relating to the Centers that has been disclosed to
Purchaser.
3.7 TAXES.
(a) Seller has filed all income, franchise, sales, payroll and other
tax returns and reports of every nature required to be filed by it accurately
reflecting all taxes owing to the United States, or any other government
(domestic or foreign) or any government subdivision, state or local, or any
other taxing authority (domestic or foreign), and has paid in full or made
adequate provision for the payment of all taxes and duties (including penalties
and interest) for which it has or may have liability, including, without
limitation, taxes payable to any jurisdiction by reason of the transfer of the
Subject Assets and the assumption of the Assumed Obligations pursuant to this
Agreement. There is not any unassessed tax deficiency proposed or threatened
against Seller, or any of them. There are no liens on the Subject Assets as a
result of any tax liabilities. There are, and after the date of this Agreement
will be, no taxes owing or tax deficiencies (including penalties and interest)
of any kind assessed against or relating to Seller with respect to any taxable
periods ending on or before, or including, the Closing Date of any of the
Centers of a character or nature that would result in Liens or claims on any of
the Subject Assets or on Purchaser's title to or use of the Subject Assets, or
that would result in any claim against Purchaser or the Subject Assets, now or
in the future.
(b) There are no outstanding agreements or waivers extending the
statutory period of limitations applicable to any federal, state, local, or
foreign tax return of Seller for any period. No federal income tax return of
Seller has been audited by the Internal Revenue Service and no state, local or
foreign taxing authority has audited any tax return or report filed by Seller.
3.8 PREPAID DEPOSIT. Schedule 3.8 is a true, correct and complete listing
of prepaid deposits for all clients attributable to the business conducted at
the Centers. All such prepaid deposits shall remain the property of Seller and
Purchaser shall have no obligation to compensate Seller for any such deposit
unless it is actually paid or credited to Purchaser, in which case a like amount
will be promptly paid by Purchaser to Seller. At or immediately following
Closing, Purchaser will advance to the holders thereof solely for the account of
Purchaser to cover obligations of the Purchaser after Closing the full amount of
the prepaid deposits listed on the attached Schedule 3.8 to the extent that any
such advance is a precondition to the refund of any such deposit to Seller.
3.9 PURCHASE ORDERS. Schedule 3.9 is a true, correct and complete list of
all of Seller's outstanding purchase orders to vendors relating to the business
of the Centers. Seller agree to update Schedules 3.9 as of the Closing.
3.10 CONTRACTS. Schedule 3.10 is a true, correct and complete list of each
Written contract, agreement, lease, license, permit, governmental authority,
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note, guaranty, instrument or understanding (collectively, "Contract(s)") and of
each oral Contract, to which Seller is a party in connection with the Seller's
business affecting the operations of the Centers or by which any of the Subject
Assets, or the Assumed Obligations are bound or affected. A true, correct and
complete copy of each written Contract and a written description of each oral
Contract has been delivered to Purchaser. All of such Contracts are in full
force and effect and no party is in default or breach of any of such Contracts.
Purchaser shall only assume the obligations under those contracts listed on
Schedule 1.3 which accrue for goods or services furnished after the Closing.
Seller will promptly and fully satisfy and/or pay all Seller's Obligations.
3.11 LITIGATION. Except as set disclosed on Schedule 3.11, there are no
suits, actions, legal or administrative proceedings, arbitrations or
governmental investigations of any nature whatsoever pending or, to the
knowledge of Seller, threatened in connection with the Seller's business or the
Subject Assets. Seller has not received any notice that Seller is the subject of
any governmental investigation. Seller is not subject to any order, writ,
injunction or decree of any court, or of any federal, state, local or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, in connection with the business conducted at the Centers or
the Subject Assets.
3.12 INSURANCE. Schedule 3.12 is a true and correct list of all the
policies of insurance covering the Seller's business at the Centers and Subject
Assets presently in force, including as to each (i) risk insured against, (ii)
name of carrier, (iii) policy number, (iv) amount of coverage, (v) expiration
date and (vi) the property, if any, insured, indicating as to each whether it
insures on an "occurrence" or a "claims made" basis. All of the insurance
policies set forth on Schedule 3.12 are in full force and effect as of the
Closing Date and all premiums, retention amounts and other related expenses due
have been paid, and Seller have not received any notice of cancellation with
respect to any of the policies. Seller has not been refused any insurance in
connection with the business conducted at any of the Centers or the Subject
Assets by any insurance carrier. To the knowledge of Seller, there are no
circumstances existing which would enable any insurer to avoid liability under
Seller's policies.
3.13 EMPLOYEES. Schedule 3.13 contains a true and correct description of
the following items with respect to each employee of Seller listed on such
Schedule: their full name as it appears on Seller's records, their date of hire,
the nature of their duties, the amount of their compensation, the date and
amount of their last increase in compensation, a description of any commitments
to such employees, including any loans made to such employees.
3.14 EMPLOYMENT MATTERS.
(a) Except as identified on Schedule 3.14, Seller is not a party to,
participant in, or bound by, any collective bargaining agreement, union
contract, insurance, pension, profit sharing arrangement or material employment,
bonus, deferred compensation, termination, severance or similar personnel
arrangement, or any stock purchase, stock option or other stock plans or
programs.
(b) Seller has not received notice of any active, pending, or
threatened administrative or judicial proceedings under Title VII of the Civil
Rights Act of 1964, the Age Discrimination in Employment Act, the Fair Labor
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Standards Act, the Occupational Safety and Health Act, the National Labor
Relations Act, or any other federal, state or local law (including common law),
ordinance or regulation relating to employees of Seller with respect to the
business of the Centers.
(c) The relation of Seller with its employees is good and there are no
pending or, to the knowledge of Seller, threatened labor difficulties.
3.15 EMPLOYEE BENEFIT PLANS AND OTHER PLAN:
(a) For purposes of this Section 3.15, the following definitions
apply:
(i) "Benefit Plan" means each deferred compensation, pension,
profit-sharing and retirement plan, each plan, arrangement or policy for the
provision of bonuses and/or severance benefits, each "employee benefit plan"(as
defined in ERISA Section 3(3)) and each fringe benefit plan (including, without
limitation, a hospitalization, insurance, stock option or stock purchase plan)
that Seller maintains, contribute to, has liability with respect to, or has an
obligation to contribute to;
(ii) "COBRA" means the Consolidated Omnibus Budget Reconciliation
Act of 1985;
(iii) "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended.
(b) Seller has not directly or indirectly acted in any manner or
incurred any obligation or liability, and will not directly or indirectly act in
any manner in the future or incur any obligation or liability in the future with
respect to any Benefit Plan which has or could give rise to any liens on any of
the Subject Assets, or which could result in any liability or obligation to
Purchaser, whether arising out of the establishment, operation, administration
or termination of such Benefit Plan or the transactions contemplated by this
Agreement.
(c) Seller has timely provided or will timely provide all notices and
any continuation of health benefit coverage (including, without limitation,
medical and dental coverage) required to be provided to employees, former
employees or the beneficiaries or dependents of such employees or former
employees, under Part 6 of Subtitle B of Title I of ERISA or, as applicable,
COBRA to the extent such notices and continuation of health benefit coverage are
required to be provided by reason of the events occurring prior to or on the
Closing Date or by reason of the transactions contemplated by this Agreement. To
the extent required by COBRA, Seller will treat its employees (and their
dependents and beneficiaries) as of the Closing Date as having incurred a
"qualifying event" (within the meaning of ERISA Section 603 and, as applicable,
Code Section 4980B(f)(3)) on the Closing Date. Seller will continue the health
benefit coverage required by COBRA. Seller will periodically, upon request,
provide Purchaser with evidence, to the satisfaction of Purchaser, of compliance
with the above provision. Seller will indemnify and hold harmless Purchaser and
its shareholders, directors, officers, employees and agents against, any costs,
expenses, losses, damages and liabilities incurred or suffered by any of them,
directly or indirectly, including, without limitation, reasonable legal fees and
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expenses, with respect to any failure of Seller to comply with the requirements
of this Section 3.15 or COBRA.
3.16 LICENSES. Each of the Centers have all necessary licenses and permits
required by Federal, State and other governmental and health related agencies
necessary to carry on its business and not licenses have been revoked, are under
suspension or have been under suspension during the past five (5) years.
3.17 CASUALTY OCCURRENCES. Except as otherwise set forth on Schedule 3.17,
to the knowledge of Seller, there have been no occurrences during the last six
(6) years of alleged damages to persons or property involving the education
services offered by Seller including, but not limited to, the educational
services offered through the Centers.
3.18 BUSINESS RELATIONS. Seller and Shareholder have no reason to believe
that the customers 0f the business of the Centers will not continue to do
business with Purchaser after the Closing at levels and on terms at least equal
to those enjoyed by Seller.
3.19 COMPLIANCE WITH LAW. Seller has complied with all laws, regulations,
rules and orders of any governmental department or agency or any other
commission, board, agency or instrumentality, federal, state or local, or other
requirements of law affecting the Seller's business, the Subject Assets and the
Assumed Obligations and is not in default under or in violation of any provision
of any federal, state or local law, regulation, rule or order affecting the
Business, nor does Seller require the consent of any governmental agency to this
Agreement.
3.20 LICENSES AND RIGHTS. Seller possesses all franchises, licenses,
easements, permits and other authorizations from governmental or regulatory
authorities (either domestic or foreign) and from all other persons or entities
that are necessary to permit it to engage in the Seller's business as presently
conducted in and at all locations of the Centers.
3.21 ARTICLES OF INCORPORATION AND BYLAWS. True, accurate and complete
copies of the Articles of Incorporation and Bylaws or similar charter documents
of Seller, together with all amendments thereto, have been delivered to
Purchaser or will be delivered within 48 hours from execution of this Agreement.
3.22 BROKERAGE AND FINDER'S FEES. Seller has not incurred any liability to
any broker, director or agent for any brokerage fees, finder's fees, or
commissions with respect to the transactions contemplated by this Agreement
except to Xxxx Xxxx who is entitled to receive a fee from Seller after Closing
and as to which Purchaser has no obligation.
3.23 LEASES. Seller is not in default under any of the leases for the
property located at the Centers, and all such leases are valid and binding
obligations - of Seller.
3.24 ENVIRONMENTAL MATTERS. Seller:
(a) Has not caused or allowed the generation, treatment, storage, or,
disposal of hazardous substances at any of the Centers except in accordance with
local, state, and federal statutes and regulations;
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(b) Has not caused or allowed the release of any toxic or hazardous
substance or substances onto, at, or near any of the Centers;
(c) Is in compliance with all applicable permits, laws, rules, and
regulations regarding the handling of hazardous substances located at or near
the Centers as of the Closing Date;
(d) Has not received inquiry or notice nor does it have any reason to
suspect or believe it will receive inquiry or notice of any actual or potential
proceedings, claims, or lawsuits arising in connection with the Subject Assets
and/or out of its operations or business as conducted at the Centers;
(e) Has not, nor has it ever been, subject to the release of any
hazardous substance at any of the Centers; and
(f) Is currently not operating or required to be operating under any
compliance order, schedule, decree or agreement, any consent decree, order, or
agreement, and/or corrective action decree, order or agreement issued or entered
into under any federal, state or local statute, regulation or ordinance
regarding the environment and/or health or safety in the workplace.
3.25 MATERIAL MISSTATEMENTS OR OMISSION. No representations or warranties
made by Seller in this Agreement or in any document, statement, certificate,
schedule, chart, list, letter, compilation or other document furnished or to be
furnished to Purchaser in connection with the transactions governed by this
Agreement, contain any untrue statement of a material fact, or omit to state a
material fact necessary to make the statements of fact contained therein, in
light of the circumstances under which they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser warrants and represents to Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING OF PURCHASER. Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of the
State of California, has full power and authority to carry on its business as
and where now conducted and to own or lease and operate its properties at and
where now owned or leased and operated by it, and is duly qualified to do
business and is in good standing in every jurisdiction in which the property
owned, leased or operated by it, or the nature of the business conducted by it,
makes such qualification necessary.
4.2 AUTHORITY PURCHASER. The execution, delivery and consummation of this
Agreement by Purchaser has been authorized by the board of directors of
Purchaser in accordance with all applicable laws and the Articles of
Incorporation and Bylaws of Purchaser, and at the Closing Date no further
corporate action will be necessary on the part of Purchaser to make this
Agreement valid and binding on Purchaser and enforceable against Purchaser in
accordance with its terms.
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4.3 EXECUTION, DELIVERY AND BINDING EFFECT. This Agreement has been duly
executed and delivered by Purchaser and constitutes a legal, valid and binding
obligation of Purchaser enforceable in accordance with its terms (subject to
bankruptcy, insolvency, reorganization and other similar laws affecting
creditors' rights generally).
4.4 BROKERAGE AND FINDER'S FEE. Neither Purchaser nor any shareholder,
officer, director or agent of Purchaser has incurred any liability to any
broker, finder or agent for any brokerage fees, finder's fees or commissions
with respect to the transactions contemplated by this Agreement.
ARTICLE V
CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
The obligations of Purchaser under this Agreement are, at its option,
subject to satisfaction of the following conditions at or prior to the Closing
Date:
5.1 The warranties and representations made herein by Seller to Purchaser,
including, but not limited to those set forth in Article III, shall be true and
correct on and as of the Closing Date with the same effect as if such warranties
and representations had been made on and as of the Closing Date, and Seller
shall have performed and complied with all agreements and covenants contained
herein on their part required to be performed or complied with on or prior to
the Closing Date, including, but not limited to those set forth in Article VII.
5.2 No investigation, proceeding or litigation, at law or in equity, by any
government or regulatory commission, agency or other body or authority or by any
other person, firm, corporation or other entity shall be pending on the Closing
Date which challenges the consummation of the transactions contemplated by this
Agreement or which claims damages against Purchaser or Seller as a result of the
consummation of the transactions contemplated hereby, or which has a material
adverse affect upon any of the operations of Seller related to the Centers or
the Subject Assets.
5.3 With respect to each of the Centers, Purchaser shall have received such
approvals, consents, authorizations, waivers and permits from any person,
necessary or appropriate in order to enable Purchaser to acquire the Subject
Assets and operate the Centers in the manner provided herein without the
imposition of any conditions which Purchaser might reasonably consider to be
significant and adverse.
5.4 All proceedings to be taken in connection with the consummation of the
transactions contemplated by this Agreement, and all certificates, documents and
instruments incidental thereto, shall be reasonably satisfactory in form and
substance to Purchaser and its counsel and Purchaser shall have received copies
of such documents and instruments as Purchaser and its counsel may reasonably
request in connection with such transactions.
5.5 There shall have been no material casualty or damage to or destruction
of any of the Subject Assets.
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5.6 RECEIPT OF DOCUMENTS BY PURCHASER. Purchaser has received:
(a) certified copies of resolutions duly adopted by the Board of
Directors of both Seller approving this Agreement and the transactions
contemplated under it;
(b) Uniform Commercial Code Termination Statements and/or other
documentation in form and substance satisfactory to Purchaser terminating any
and all Liens that may affect any of the Subject Assets; and
(c) Purchaser shall have received from Seller a certificate dated the
Closing Date, in a form acceptable to Purchaser, certifying that the conditions
set forth in Sections 5.1 through 5.5 have been fulfilled.
(d) Opinion of counsel for Seller in a form substantially similar to
the attached Schedule 5.6.
5.7 INSTRUMENTS OF TRANSFER AND DELIVERY OF THE SUBJECT ASSETS. Seller
shall have delivered to Purchaser good and sufficient instruments of transfer
relating to the Subject Assets. The instruments of transfer shall be in form and
substance reasonably satisfactory to Purchaser and its counsel.
5.8 .LEASE ASSIGNMENT. Purchaser shall have negotiated and entered into
alternative leasing arrangements for each of the Centers no later than fifteen
(15) days following the mutual execution hereof, failing which Purchaser shall
accept the approval of such landlord(s) to the assignment of the particular
lease(s) to Purchaser without modification.
ARTICLE VI
CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
The obligations of Seller under this Agreement are, at its option, subject
to satisfaction of the following conditions at or prior to the Closing Date:
6.1 No investigation, proceeding or litigation, at law or in equity, by any
governmental or regulatory commission, agency or other body or authority or by
any other person, firm, corporation or other entity shall be pending on the
Closing Date which challenges the consummation of the transactions contemplated
by this Agreement or which claims damages against Purchaser or Seller as a
result of the consummation of the transactions contemplated hereby, or which
adversely affects any of the operations of the Subject Assets.
6.2 The warranties and representations made herein by Purchaser to Seller
shall be true and correct on and as of the Closing Date with the same effect as
if such warranties and representations had been made on and as of the Closing
Date, and Purchaser shall have performed and complied with all agreements and
covenants contained herein on its part required to be performed or complied with
on or prior to the Closing Date.
6.3 All proceedings to be taken in connection with the consummation of the
transactions contemplated by this Agreement, and all certificates, documents and
13
instruments incidental thereto, shall be reasonably satisfactory in form and
substance to Seller and its counsel and Seller shall have received copies of
such documents and instruments as Seller and its counsel may reasonably request
in connection with such transactions.
6.4 The funding of the Seller Loan and the delivery to the Seller of good
funds in the full amount thereof as follows:
(a) One Hundred Fifty Thousand Dollars ($150,000) shall be immediately
disbursed to Seller from the Client Trust Account at such time as (i) all UCC-1
Financing Statement liens covering any of the Subject Assets relating to the
California Centers have been released or subordinated to the UCC-1 Financing
Statement lien of Purchase (Purchaser's Lien) being given to secure the Seller
Loan, with the exception of that certain UCC-1 Financing Statement filed on
August 4, 1994 under filing number 0000000000 in favor of Xxxxx and Xxxxx
Xxxxxxx (the "Xxxxxxx Xxxx"); and (ii) a first priority lien in favor of
Purchaser has been recorded against the leasehold interest of Seller in and to
the Newbury Park, California Center, also being given to secure the Seller Loan.
(b) One Hundred Fifty Thousand Dollars ($150,000.00) shall be
immediately disbursed to Seller from the Client Trust Account at such time as
(i) a first priority lien in favor of Purchaser has been recorded against the
leasehold interest of Seller in and to the Lake Forest, California Center being
given to secure the Seller Loan; and (ii) the Xxxxxxx Xxxx has been released or
subordinated to Purchaser s Lien, which release or subordination, at the
direction of Seller, may b accomplished by the disbursement of the required
amount of Seller Loan funds from the Client Trust Account directly to the
holders of the Xxxxxxx Xxxx.
ARTICLE VII
CONDUCT OF SELLER'S BUSINESS PRIOR TO CLOSING
The Seller covenants and agrees that, pending the Closing and except as
Purchaser shall have otherwise consented thereto in writing:
7.1 ORDINARY COURSE. The business of the Seller will be conducted only yin
the ordinary course.
7.2 NO NEW AGREEMENTS. No contract, agreement, obligation, lease, license
or other commitment will be entered into or assumed by or on behalf of any
Seller which relates to or affects the Centers, except for normal and ordinary
contracts in the ordinary course of business.
7.3 TAX RETURNS; COMPLIANCE. Seller shall duly and timely file all reports
or returns required to be filed with federal, state, foreign, local and other
authorities and will promptly pay all federal, state, foreign and local tax
assessments and governmental charges lawfully levied or assessed upon it or its
properties or upon any part thereof, except taxes or charges being contested in
good faith by appropriate proceedings and for which adequate provision has been
made and will duly observe and conform to all lawful requirements of any
governmental authority relating to its properties or to the operation and
conduct of its business and all covenants, terms and conditions upon or under
which any of its properties are held.
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7.4 MAINTENANCE. All buildings, offices and other real property and all
machinery, equipment, fixtures, motor vehicles (except as otherwise specified in
the attached Schedule 1.1) and other property of the Seller will be kept and
maintained in good operating condition, repair and working order, ordinary wear
and tear excepted.
7.5 INSURANCE. The Seller shall continue to maintain in full force and
effect to and including the Closing Date(s) for all Centers, all policies of
insurance now in effect, or renewals thereof or equivalent policies.
7.6 NO SALES OR MERGERS. Seller shall not enter into any other Agreements
to sell the Subject Assets or any or all of the Centers.
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS
AND WARRANTIES, INDEMNIFICATIONS
8.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Notwithstanding the Closing
of the transactions contemplated under this Agreement, or any investigation made
by or on behalf of Purchaser, the representations and warranties of Seller
contained in this Agreement or in any certificate, schedule, list, or other
document furnished pursuant to this Agreement, will survive the Closing.
8.2 .INDEMNIFICATION.
(a) Seller covenants and agrees to indemnify, defend and hold harmless
Purchaser,, its affiliates and its shareholders, directors, officers, employees
and agents ("Purchaser Indemnities") from any and all costs, expenses, losses,
damages and liabilities incurred or suffered, directly or indirectly, by any of
them (including, without limitation, actual legal fees and expenses) arising out
of, in connection with, resulting from or attributable to the following
("Indemnified Losses"): (a) the breach of, or misstatement in, any one or more
of the representations or warranties of Seller made in or pursuant to this
Agreement, (b) the breach of any one or more of the covenants of Seller made in
or pursuant to this Agreement, (c) any claims, demands, suits, investigations,
proceedings or actions by any third party containing or relating to allegations
that, if true, would constitute a breach of, or misstatement in, any one or more
of the representations or warranties of Seller made in or pursuant to this
Agreement, and (d) any trade payables, obligations or liabilities of Seller of
any nature whatsoever (whether accrued, absolute, contingent or otherwise),
except the Assumed Obligations. All Indemnified Losses shall be payable on
demand and without limiting Purchaser's other rights and remedies may be offset
by Purchaser against any amount that might otherwise be payable by Purchaser to
Seller.
(b) Purchaser will indemnify and hold harmless the Seller in respect
of, claims, losses, expenses, costs, obligations and liabilities they may incur
by reason of Purchaser's breach of or failure to perform any of its warranties
or covenants in this Agreement, or by reason of any act or omission of
Purchaser, or any of its successors or assigns, after the Closing Date, that
constitutes a breach or default under, or a failure to perform, any obligation
or liability of the Seller under any lease, contract, order, or other agreement
15
to which it is a party or by which it is bound at the Closing Date, but only to
the extent to which Purchaser expressly assumes these obligations, duties, and
liabilities under this Agreement.
ARTICLE IX
NON-COMPETITION
9.1 NON-COMPETITION AGREEMENT.
(a) As a material inducement to Purchaser to enter into this
Agreement, Seller agrees for itself and each of its respective subsidiaries and
affiliates that for a period of five (5) years from and after the Closing Date
for each of the Centers, it will not, directly or indirectly:
(i) engage in, carry on or have any interest in a child care
business in the Covenant Territory (as hereinafter defined);
(ii) enter into, engage in, or be employed by or consult with any
child care business in the Covenant Territory;
(iii) induce any customers of the Centers to refuse to continue
to use the services of the Centers.
As used herein, the term "Covenant Territory" shall mean a radius of three (3)
miles on a straight line from each and every one of the Centers acquired
pursuant to this Agreement, provided however that the Seller's existing child
care facilities and the following additional locations which are under
consideration for future development as child care centers are exempt from this
non-competition provision:
Foothills Ranch (Lake Forest, CA) -described as
Pad A in the Towne Center, located at the South
East corner of Towne Center Drive and Xxxxx
Parkway.
Denver Tech Center in Denver, CO. on South
Yosemite Blvd, between East Belleview Avenue and
DCT Parkway.
The parties acknowledge that the length of time pertaining to all prohibitions
in this Section are reasonable and necessary for the legitimate protection of
Purchaser's business and interests.
(b) Seller expressly agrees and understand that the remedy at law for
any breach by Seller of this Article IX will be inadequate and that the damages
flowing from such breach are not readily susceptible to being measured in
monetary terms. Accordingly, it is acknowledged that upon violation or
threatened violation of this Article IX, Purchaser will be entitled, among other
remedies, to immediate injunctive relief and may obtain a temporary restraining
order and injunction restraining any breach or threatened breach without the
necessity of posting bond. Nothing contained herein will be deemed to limit
Purchaser's remedies at law or in equity for any breach by Seller of any of the
provisions of this Agreement.
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(c) In the event any court of competent jurisdiction determines that
the specified time period or geographical area set forth in this Section 9.1 is
unreasonable, arbitrary or against public policy, then a lesser time period or
geographical area that is determined by the court to be reasonable,
non-arbitrary and not against public policy may be enforced.
(d) In the event that Seller violates any provision of this Section
9.1 as to which there is a specific time period during which Seller is
prohibited from taking certain actions or engaging in certain activities, then,
in such event the violation will toll the running of the time period from the
date of the violation until the violation ceases.
9.2 DISCLOSURE OF CONFIDENTIAL INFORMATION. From and after the Closing
Date, Seller, agrees not to disclose, disseminate, divulge, discuss, copy or
otherwise use or suffer to be used, in competition with, or harmful to the
interests of, Purchaser, any information (written or oral), documents, lists or
other data of or respecting any aspect of the Subject Assets, the Assumed
Obligations or the business of the Centers, except as (a) may otherwise be in
the public domain; (b) may be necessary for tax filing and/or reporting
purposes; or (c) may otherwise be required by law.
ARTICLE X
NOTICES
All notices, requests, demands and other communications under this
Agreement must be in writing and will be deemed duly given, unless otherwise
expressly indicated to the contrary in this Agreement, (i) when personally
delivered, (ii) upon receipt of a facsimile transmission with a confirmed
transmission answer back, (iii) three (3) days after having been deposited in
the United States mail, certified or registered, return receipt requested,
postage prepaid, or (iv) one (1) business day after having been dispatched by a
nationally recognized overnight courier service, addressed to the parties or
their permitted assigns at the following addresses (or at such other address or
number as is given in writing by either party to the other) when accompanied by
facsimile transmission as follows:
To Purchaser: Imagination Plus
Child Development Center, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx
Chairman of the Board
Facsimile No.: (000) 000-0000
With a copy to: Buchalter, Nemer, Fields & Younger
Suite 2400
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
17
To Seller: Children's Wonderland, Inc.
00000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Chief Executive Officer
Facsimile No.: (000) 000-0000
Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxxx, Xxxxxxxx, Mann, Greene,
Chizever, Xxxxxxxx & Xxxxxxxx
0000 Xxxxxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
ARTICLE XI
MISCELLANEOUS
11.1 TERMINATION OF AGREEMENT. Certain of the parties herein may terminate
this Agreement as provided below:
(i) the Purchaser and the Seller may terminate this Agreement by
mutual written consent at any time prior to the Closing;
(ii) the Purchaser may terminate this Agreement by giving written
notice to the Seller at any time prior to the particular Closing (A) in the
event the Seller has breached any representation, warranty, or covenant
contained in this Agreement in any material respect, (B) if the particular
Closing shall not have occurred on or before October 1, 1997, by reason of the
failure of any condition precedent or conduct of Seller prior to Closing under
Articles V and VII hereof (unless the failure results primarily from the
Purchaser itself breaching any representation, warranty, or covenant in any
material respect contained in this Agreement or failing to use its reasonable
best efforts to satisfy the conditions precedent set forth in Article V hereof);
and
(iii) the Seller may terminate this Agreement by giving written
notice to the Purchaser at any time prior to the Closing in the event the
Purchaser has breached any representation, warranty, or covenant contained in
this Agreement in any material respect, or by reason of the failure of any
condition precedent under Article VI hereof (unless the failure results
primarily from the Seller itself breaching any representation, warranty, or
covenant in any material respect contained in this Agreement).
If any party herein terminates this Agreement pursuant to this Section 11.1, all
rights and obligations of the parties hereunder shall terminate without any
liability of any party, except for any liability of any party then in breach and
Seller's obligations under the Seller Loan will be deemed accelerated and mature
as of the termination date. Further, as of such termination date, all funds held
by Purchaser's attorneys may be returned to Purchaser.
18
11.2 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original but all of which
together will constitute one and the same document.
11.3 CAPTIONS AND SECTION HEADINGS. Captions and section headings are for
convenience only, are not a part of this Agreement and may not be used in
construing it.
11.4 WAIVERS. Any failure by any of the parties to comply with any of the
obligations, agreements or conditions set forth in this Agreement may be waived
in writing by the other party or parties, but any such waiver will not be deemed
a waiver of any other obligation, agreement or condition contained herein.
11.5 AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS. Each of the parties agrees
to cooperate in the effectuation of the transactions contemplated under this
Agreement and to execute any and all additional documents and take such
additional action as is reasonably necessary or appropriate for such purposes.
11.6 ENTIRE AGREEMENT. This Agreement, including any certificate, schedule,
exhibit or other document delivered pursuant to its terms, constitutes the
entire agreement between the parties hereto regarding the subject matter hereof
and supersedes all previous agreements. There are no verbal agreements,
representations, warranties, undertakings or agreements between the parties.
This Agreement may not be amended or modified in any respect, except by a
written instrument signed by the parties to this Agreement.
11.7 .GOVERNING LAW. This Agreement, the construction, interpretation and
enforcement thereof and the rights of the parties thereto shall be determined
under, governed by and construed in accordance with the laws of the State of
California without regard to principles of conflicts of law.
11.8 ASSIGNMENT, THIRD PARTIES, BINDING EFFECT. The rights of Seller under
this Agreement are not assignable nor are their duties delegable without the
prior written consent of Purchaser, and any attempted assignment or delegation
without such consent will be null and void. Nothing contained in this Agreement
is intended to convey upon any person or entity, other than the parties and
their successors in interest and permitted assigns, any rights or remedies under
or by reason of this Agreement. All covenants, agreements, representations and
warranties of the parties contained in this Agreement are binding on and will
inure to the benefit of Purchaser and Seller, and their respective successors
and permitted assigns.
11.9 EXPENSES. Each party will bear their own respective expenses,
including, without limitation, legal and accounting fees, in connection with the
preparation and negotiation of, and transactions contemplated under, this
Agreement.
11.10 DISPUTE RESOLUTION AND JURY TRIAL WAIVER. If any legal action is
brought for the enforcement of this Agreement or any provision hereof, or
because of any alleged dispute, breach, default, or misrepresentation in
connection with any of the provisions of this Agreement, the successful or
prevailing party or parties shall be entitled to recover reasonable attorneys'
fees and other costs incurred in that action or proceeding, in addition to any
19
other relief to which it or they may be entitled. THE PARTIES HEREBY WAIVE TRIAL
BY JURY IN ANY SUCH ACTION.
11.11 REMEDIES NOT EXCLUSIVE. No remedy conferred by any of the specific
provisions of this Agreement is intended to be exclusive of any other remedy,
and each and every remedy will be cumulative and will be in addition to every
remedy given under this Agreement or now or subsequently existing, at law or in
equity, by statute or otherwise. The election of any one or more remedies by
Purchaser, Seller or Shareholders will not constitute a waiver of the right to
pursue other available remedies.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on the
date first above written.
"PURCHASER"
IMAGINATION PLUS CHILD
DEVELOPMENT, INC.
By: /s/
------------------------------------------
Xxxxx Xxxxxxxxx, Chairman of the Board
"SELLER"
CHILDREN'S WONDERLAND, INC.
By: /s/
------------------------------------------
Xxxxx X. Xxxxxxxx, Chief Exec. Officer 2
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SCHEDULE A-1
CHILDREN'S WONDERLAND, INC.
CALIFORNIA CENTERS
LOCATION
00000 Xxxx Xxxxxx Xxxxx
Xxxx Xxxxxx, XX
000 Xxxx Xxxx Xxxxx
Xxxxxxx Xxxx, XX
SCHEDULE A-2
CHILDREN'S WONDERLAND, INC.
COLORADO SUMMARY LEASE INFORMATION
All leases are on a triple net basis.
LOCATION SIZE LEASE RENT
(SQ. FT.) TERM PER MONTH
6TH & XXXXXXXX 6,400 2/1/95 through 1/31/00; 2 five 2/1/97: $4,117.33
00000 X. 0xx Xxx. year options 2/1/98: $4,320.00
Xxxxxx, XX 00000 2/1/99: $4,533.33
WESTMINSTER 5,320 4/1/95 through 3/31/01; 2 six 4/1/97: $2,394.00
0000 X. 00xx Xxx. year options 4/1/99: $2,584.63
Xxxxxxxxxxx, XX 00000
IRONTON 6,000 2/1/95 through 1/31/00; 2 five $2,100; no discussion
0000 Xxxxxxx Xx. year options of CPI increase
Xxxxxx, XX 00000
TOWER RD. 3,680 2/1/95 through 4/30/99; 2 five 5/1/97: $2,606.67
00000 X. Xxxxxxx Xxx. year options 5/1/98: $2,760.00
Xxxxxx, XX 00000
EDGEWATER 4,800 12/1/95 through 11/31/03; 1 $3,133.88 with annual
0000 X. 00xx Xx. five year option CPI increases not to
Xxxxxxxxx, XX 00000 exceed 5% in any one
year.
WESTGATE 5,012 2/1/95 through 1/31/00; no 2/1/95: $2,923.67
3225 X. Xxxxxxxxx options. 8/1/97: $3,341.33
Xxxxxxxx, XX 00000
The following is a list briefly identifying the contents of the Schedules
omitted from this EXHIBIT 2.1. The Registrant agrees to furnish supplementally a
copy of any omitted Schedules to the Commission upon its request.
SCHEDULE 1.1: Personal Property, Inventory and Equipment at the Centers
SCHEDULE 1.2: Excluded Assets
SCHEDULE 1.3: Assumed Obligations
SCHEDULE 3.9: Outstanding Purchase Orders
SCHEDULE 3.10: Contracts
SCHEDULE 3.11: Litigation
SCHEDULE 3.12: Insurance
SCHEDULE 3.13: Employee Information
SCHEDULE 3.14: Employment Bargaining or Other Agreements
