Exhibit 10.1
PURCHASE AND SALE AGREEMENT
(EAGAN SCHOOL)
This PURCHASE AND SALE AGREEMENT (the "Agreement") is entered into as of
this 28th day of March, 2001, by and between THE TESSERACT GROUP, INC., a
Minnesota corporation, in its corporate capacity and in its capacity as debtor
and debtor-in-possession in its Chapter 11 case pending in the United States
Bankruptcy Court for the District of Arizona ("Seller"), and TESSERACT OF EAGAN,
INC., a Minnesota non-profit corporation ("Buyer").
RECITALS
A. Seller operates that certain private school commonly known as the "Eagan
TesseracT School" located at 0000 XxxxxxxxX Xxxxx, Xxxxx, Xxxxxxxxx 00000 (the
"School").
B. Seller has filed a voluntary petition for Chapter 11 relief under Title
11 of the United States Code ("Bankruptcy Code"), which is pending before the
United States Bankruptcy Court for the District of Arizona (the "Court").
C. Seller desires, subject to the approval of the Court, to sell and Buyer
desires to purchase certain assets and assume certain liabilities of Seller in
connection with Seller's operations of the School on the terms and conditions
set forth in this Agreement and in accordance with Bankruptcy Code ss.ss.363 and
365.
D. Buyer shall complete its due diligence of the School and all other
matters addressed in this Agreement by no later than the Initial Hearing Date
(as defined in SECTION 1.10).
E. Prior to or contemporaneously with the closing of this transaction,
Buyer intends on purchasing the real property on which the School is situated,
and the related improvements and fixtures from EPI (defined below).
F. The parties hereto acknowledge that: (i) they intend that the
transaction contemplated under this Agreement be an asset purchase and not a
sale of the stock of Seller; and (ii) Buyer is not buying the Business of Seller
as defined in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
For purposes of this Agreement, the following capitalized terms, when used
in this Agreement, shall have the meanings assigned to them as follows:
1.1 ASSUMED CONTRACTS. The term "Assumed Contracts" shall mean all Teaching
Contracts (as defined in SECTION 1.16), which Buyer will assume hereunder, and
all other contracts, if any, which are specifically set forth on Schedule 1.1
attached hereto.
1.2 BUSINESS. The term "Business" shall mean Seller's operations conducted
under the name "TesseracT," "The TesseracT Group, Inc.," or " Eagan TesseracT
School," at the School.
1.3 CLAIM. The term "Claim" shall be given the same meaning as provided to
such term under Bankruptcy Code ss. 101(5).
1.4 CLOSING. The term "Closing" shall mean the completed exchange of: (i)
Closing documents set forth in Articles XV and XVI below, together with the
simultaneous conveyance by Seller to Buyer of the Purchased Assets; (ii) the
payments between Buyer and Seller due under the terms of this Agreement; and
(iii) the assumption by Buyer of the obligations which it has expressly agreed
to assume hereunder.
1.5 DELINQUENT REAL PROPERTY TAXES. The term "Delinquent Real Property
Taxes" shall mean those real property taxes that are classified as delinquent by
the applicable governmental authorities.
1.6 CLOSING DATE. The term "Closing Date" shall mean the date on which the
Closing occurs which shall not be later than March 30, 2001, unless such date is
extended in accordance with SECTION 11.1.
1.7 EAGAN PROPERTY. The term " Eagan Property" shall mean that certain real
property located in Eagan, Minnesota, at which Seller operates the charter
school commonly referred to as the " Eagan TesseracT School".
1.8 EPI. The term "EPI" shall mean Education Property Investors, Inc., a
Nevada corporation.
1.9 EQUIPMENT. The term "Equipment" shall mean all furniture, fixtures,
office equipment, computers, printers, and other tangible personal property
owned by Seller and located at the School as evidenced by Schedule 1.9 attached
hereto, the inventory list prepared by Seller.
1.10 INITIAL HEARING DATE. The "Initial Hearing Date" shall mean the date
the Court conducts its initial hearing on the Motion to approve the sale of the
Purchased Assets (as defined in SECTION 2.1).
1.11 LEASE. The term "Lease" shall mean that certain Lease dated as of June
9, 1998 by and between Seller, as lessee, and EPI, as lessor, pursuant to which
Seller leases the Real Property and the Eagan Property from EPI.
1.12 REAL PROPERTY PURCHASE AGREEMENT. The term "Real Property Purchase
Agreement" shall mean the written agreement between Buyer and EPI that provides
for EPI's sale, and Buyer's purchase, of the Real Property.
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1.13 REAL PROPERTY. The term "Real Property" shall mean the real property
that is the subject of the Real Property Purchase Agreement, which is commonly
known as 0000 XxxxxxxxX Xxxxx, Xxxxx, Xxxxxxxxx.
1.14 SECTION 363 ORDER. The term "Section 363 Order" shall mean the order
entered by the Court pursuant to Bankruptcy Code ss.363 approving Seller's sale
of the Purchased Assets (as defined in SECTION 2.1 below) to Buyer free and
clear of any and all liens, encumbrances, claims, security interests, and
adverse interests of any kind, the form of which shall be agreed to by the
parties hereto.
1.15 SECTION 365 ORDER. The term "Section 365 Order" shall mean the Order
entered by the Court pursuant to Bankruptcy Code ss.365(a) approving Seller's
decision to: (i) reject the Lease; and (ii) assume the Assumed Contracts, the
form of which shall be agreed to by the parties hereto.
1.16 TEACHERS' ACCRUED LIABILITIES. The term "Teachers' Accrued
Liabilities" shall mean the liabilities of Seller for accrued compensation
arising under Seller's employment obligations with the teachers at the School
(the "Teaching Contracts"), as of the Closing Date, which are specifically set
forth on Schedule 1.16 attached hereto and totals approximately $86,517.65. The
Teachers' Accrued Liabilities amounts set forth on Schedule 1.16 are effective
as of March 30, 2001, and the parties will agree to an amended Schedule 1.16 at
the Closing which shall set forth the actual amount of the Teachers' Accrued
Liabilities on the Closing Date.
ARTICLE II.
PURCHASE AND SALE
2.1 ASSETS TO BE SOLD. Subject to the terms and conditions of this
Agreement, on the Closing Date, Seller agrees to sell, assign, transfer and
convey, free and clear of any and all liens, encumbrances, claims, security
interests, and adverse interests of any kind, other than as set forth on
Schedule 2.1, the following assets and intangibles to Buyer (collectively, the
"Purchased Assets"), which the Buyer may use to operate a school:
2.1.1 EQUIPMENT AND THE ASSUMED CONTRACTS. The Equipment and the
Assumed Contracts.
2.1.2 OTHER PERSONAL PROPERTY. In addition to the Equipment, except as
specifically excluded pursuant to Section 2.2 of the Agreement, any and all
other tangible and intangible property utilized by Seller in connection with the
Business conducted at the School facility, including, but not limited to, all
security and utility deposits, supplies-on-hand and the 1996 Ford E 350 Van.
2.1.3 RECORDS. FILES AND RELATED MATERIALS. Subject to confidentiality
requirements under state and federal laws, copies of all records, files,
invoices, student lists, employee files, accounting records, business records,
operating information, any available historical financial data and other data of
Seller relating to the School.
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2.1.4 GOODWILL. All of Seller's goodwill that relates to the School.
2.2 EXCLUDED ASSETS. Notwithstanding SECTION 2.1 above, Seller shall not
sell, transfer, assign, convey or deliver to Buyer, any asset not specifically
addressed in SECTION 2.1 above, including but not limited to the following
assets (collectively the "Excluded Assets"):
2.2.1 CONSIDERATION. The consideration delivered by Buyer to Seller
pursuant to this Agreement.
2.2.2 INTELLECTUAL PROPERTY. Subject to SECTION 8.2 of this Agreement,
all intellectual property of Seller, including, but not limited to, Sellers'
trademarks, trade names, curriculum, and trade secrets.
2.2.3 INSURANCE POLICIES. Seller's insurance policies and rights
thereunder, including, but not limited to, general liability and workers'
compensation insurance held by Seller.
2.2.4 CORPORATE FRANCHISE. Seller's franchise to be a corporation, its
certificate of incorporation, corporate seal, stock books, minute books and
other corporate records having exclusively to do with the corporate organization
and capitalization of Seller.
2.2.5 CASH OR CASH EQUIVALENTS. Other than deposits addressed in
SECTION 2.1.2, Seller's accounts receivable, cash or cash equivalents are
Excluded Assets to this Purchase Agreement.
ARTICLE III.
ASSUMPTION OF LIABILITIES
3.1 ASSUMED LIABILITIES. At Closing, Seller shall assume, cure and assign,
and Buyer shall accept said assignment (collectively, the "Assumed Liabilities")
of the Assumed Contracts; provided, however, that Buyer shall, with the
exception of the $86,517.65 due under the Teaching Contracts as described in
SECTION 1.8 of this Agreement and subject to adjustment as set forth therein,
only be obligated to pay, perform, or discharge in accordance with their, terms
such obligations thereunder that arise on or after the Closing Date.
Additionally, at Closing Seller shall assume and assign, and Buyer shall accept
said assignment of: (i) the Delinquent Real Property Taxes pursuant to Section
8.6; and (ii) the Mechanic's Lien pursuant to Section 8.7. Buyer shall fully and
faithfully perform all duties and obligations, due or owing after Closing, of
Seller with respect to the Assumed Liabilities.
3.2 NO ASSUMPTION OF OTHER LIABILITIES. Except as expressly set forth in
this Agreement, Buyer does not by this Agreement, and will not be obligated to,
assume any obligation, liability or duty of Seller whether incurred in
connection with the Purchased Assets, or otherwise, including, without
limitation, any obligation or liability of Seller relating to, arising from or
in connection with any tort claims made by a third party relating to the
Business.
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ARTICLE IV.
TERMS OF PAYMENT
4.1 PAYMENT DUE AT CLOSING. At Closing, Buyer shall pay to Seller an amount
equal to Thirty Thousand and No/100 Dollars ($30,000.00) less the amount of the
Deposit delivered by Buyer to Seller in accordance with SECTION 4.2 below, in
immediately available funds. In addition, at Closing Seller shall pay to Buyer
an amount equal to One Hundred Thousand Dollars ($100,000.00) for Buyer's
assumption of the Assumed Liabilities and the Teachers' Accrued Liabilities in
immediately available funds. Buyer's payment and Seller's payment shall
collectively be referred to as the "Purchase Price".
4.2 DEPOSIT. Contemporaneously with the execution of this Agreement, Buyer
shall deliver to Seller a cash deposit in the amount of Ten Thousand and No/100
Dollars ($10,000.00) (the "Deposit"). Prior to the expiration of the Due
Diligence Period, the Deposit shall be refundable to Buyer as provided herein.
Upon the expiration of the Due Diligence Period, the Deposit shall become
non-refundable except in the event that a condition precedent of Buyer's duty to
close pursuant to SECTIONS 13.1 THROUGH 13.4 or SECTION 13.6 has not been fully
and completely satisfied as of the Closing. In the event the sale of the
Purchase Assets as contemplated hereunder is consummated, the Deposit shall be
delivered to Seller at the Closing and credited against the Purchase Price.
ARTICLE V.
DUE DILIGENCE
5.1 DUE DILIGENCE PERIOD. Buyer shall have until the expiration of the Due
Diligence Period (as hereinafter defined) to conduct Due Diligence
investigations with respect to the Purchased Assets. Seller shall make available
to Buyer and its employees, representatives, counsel and consultants access to
all of its documents, materials, books, records and files relating to the
Purchased Assets in Seller's possession or reasonable control, and Seller agrees
to allow Buyer to make copies at Seller's office of such items as Buyer
reasonably requests and at Buyer's sole cost and expense. As used herein, "Due
Diligence Period" means the period commencing on the date the parties execute
this Agreement and ending at 5:00 P.M. (Mountain Standard Time) on the Initial
Hearing Date.
5.2 TERMINATION DURING DUE DILIGENCE. Prior to the end of the Due Diligence
Period, Buyer shall have the right to terminate this Agreement at any time in
its sole and absolute discretion and for any reason or no reason whatsoever upon
delivery to Seller of written notice informing Seller of its election to
terminate the Agreement. Upon the expiration of the Due Diligence Period, if
Buyer has not delivered written notice to Seller terminating the Agreement,
then, the Deposit shall become non-refundable, except in the event that a
condition precedent of Buyer's duty to close pursuant to Sections 13.1 through
13.4 or Section 13.6 has not been fully and completely satisfied as of the
Closing, in which case the Deposit shall be refunded to Buyer.
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ARTICLE VI.
REPRESENTATIONS, WARRANTIES, AND COVENANTS OF SELLER
Seller hereby represents, warrants, and covenants to Buyer as follows, and
the warranties, representations, and covenants contained in this Article or
elsewhere in this Agreement shall be deemed to be made as of the Closing:
6.1 CORPORATE STATUS. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Minnesota and is
qualified to do business in the State of Arizona.
6.2 CORPORATE AUTHORITY. Subject only to approval of the Court, Seller has
full power and authority to execute and perform this Agreement and all corporate
action necessary to confirm such authority has been duly and lawfully taken.
Upon execution hereof, this Agreement shall be a valid, legally binding
obligation of Seller, enforceable in accordance with its terms subject only to
approval by the Court.
6.3 TITLE TO PURCHASED ASSETS. Seller has good and marketable title to the
Purchased Assets, and has full power and authority to transfer such title to
Buyer subject only to approval by the Court.
6.4 ASSUMED CONTRACTS. The Assumed Contracts are valid, binding and in full
force and effect; and there exists no default or event that with the giving of
notice, the passage of time or both, would constitute a default thereunder that
remains uncured as of the Closing Date.
ARTICLE VII.
REPRESENTATIONS, WARRANTIES, AND COVENANTS OF BUYER
Buyer hereby represents and warrants to Seller as follows and the
warranties and representations contained in this Article or elsewhere in this
Agreement shall be deemed to be made as of Closing:
7.1 ORGANIZATION. Buyer is a Minnesota non-profit corporation duly
organized, validly existing and in good standing under the laws of the State of
Minnesota.
7.2 AUTHORITY. Buyer has full power and authority to execute and perform
this Agreement and all action necessary to confirm such authority has been duly
and lawfully taken. Upon execution hereof, this shall be a valid and legally
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms subject only to approval by the Court.
7.3 CONDITION OF ASSETS. Buyer has fully examined the physical condition of
the Purchased Assets, and hereby agrees to accept such property AS IS AND WHERE
IS. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT,
NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, IS MADE
WITH RESPECT TO THE PURCHASED ASSETS.
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ARTICLE VIII.
OTHER COVENANTS
8.1 TESSERACT NAME. Buyer shall have a fully paid-up, non-exclusive,
perpetual license to use the trademark and trade name "TesseracT" as part of the
full name of the School. Buyer may prepare for Seller's execution a licensing
agreement consistent with the terms herein.
8.2 TESSERACT NAME. Buyer shall have have the fully paid-up, non-exclusive,
perpetual right to use Seller's curriculum in its post-closing operation of the
school, including, without limitation, materials, and instruction techniques of
Seller.
8.3 DEFERRED REVENUE CLAIMS FOR PREPAID TUITION AND DEPOSITS. Parents
previously paid certain deposits and prepaid tuition to Seller which have not
been earned by Seller as of the date of this Agreement, but would be earned by
Seller if Seller continued to operate the School to the end of the existing
school year (the "Deferred Revenue Claims"). It is Seller's position that if
Buyer purchases the Real Property underlying this School and contemporaneously
closes the transaction set forth in this Agreement, Buyer will be responsible
for providing the services related to the Deferred Revenue Claims to the parents
who hold such claims. Buyer disagrees with Seller's position. The parties fully
reserve their rights with respect to this issue.
8.4 LEASE CLAIMS. Seller understands that Buyer has or may bring certain
claims arising under or relating to the Lease. Buyer reserves the right to
assert such claims in Seller's bankruptcy case, and Seller reserves the right to
object to all such claims in its bankruptcy case.
8.5 DELINQUENT REAL PROPERTY TAXES. At Closing, Seller shall assign and
Buyer shall accept said assignment of the Delinquent Real Property Taxes on the
Eagan Property in an amount not to exceed Eighty-Four Thousand and No/100
Dollars ($84,000.00).
8.6 MECHANIC'S LIEN. As of Closing, Seller shall assign, and Buyer shall
accept said assignment of the Mechanic's Lien existing on the Eagan Property in
an amount not to exceed Eighteen Thousand Five Hundred and No/100 Dollars
($18,500.00).
ARTICLE IX.
EMPLOYEES
9.1 DEFINITION. Seller has provided Buyer with a complete list of all
persons regularly employed on either a part-time or full-time basis by Seller in
connection with the School. For purposes of this Article, the term "Employees"
shall mean all persons on such list.
9.2 EMPLOYMENT OF SELLER'S EMPLOYEES AT THE SCHOOL. As of the Closing Date,
Buyer shall assume all of the Teaching Contracts. From and after the Closing
Date, Buyer shall be solely responsible for payment, when and if due, of all
obligations under the Teaching Contracts, including, without limitation, any
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accrued vacation pay, sick leave, or bonuses earned under the Teaching
Contracts, but only to the extent specifically set forth in the Teaching
Contracts. Immediately prior to, or simultaneously with, the Closing, Seller
shall terminate the employment of all of its employees, except those employees
under the Teaching Contracts. Buyer intends to offer employment to most of
Seller's employees. Except for the Teaching Contracts, Buyer shall not assume
any liabilities relating to, arising from or in connection with any obligation
or liability of Seller relating to employees or independent contractors
including, but not limited to, accrued salaries, other compensation or benefits,
severance payments, accrued vacations, pensions, retirement plans, distributions
or bonuses. Seller shall indemnify Buyer for all pre-Closing obligations and
liabilities relating to, arising from or in connection with any obligation or
liability of Seller relating to employees or independent contractors (other than
the $86,517.65 due under the Teaching Contracts as described in SECTION 1.16 of
this Agreement and subject to adjustment as set forth therein) and any other
employment relationships, including, without limitation, payment of accrued
payroll which shall be paid by Seller prior to the Closing.
9.3 EMPLOYEE SOLICITATIONS. Buyer shall be entitled to reasonable access to
all employees related to the School for purposes of interviewing these
individuals.
9.4 WORKERS' COMPENSATION. Seller agrees to assume all responsibility for
liability arising from workers' compensation claims, both medical and
disability, which have been filed at or prior to the time of Closing or which
arose out of incidents that occurred prior to Closing. Buyer shall be
responsible for all claims, which arise out of, or are based upon, incidents,
which occur subsequent to Closing.
ARTICLE X.
INDEMNITIES
10.1 SELLER. Seller agrees to hold harmless, indemnify and defend Buyer
from and against any and all loss, claim, damage, liability or expense
(including, but not limited to, reasonable attorneys' fees and costs) arising
out of or occurring as the result of any breach by Seller of any of its
covenants, representations or warranties hereunder. Such indemnification shall
include any claims pertaining to events or actions occurring prior to the date
of Closing. In no event shall the liability of Seller under this SECTION 10.1
collectively exceed $5,000.00.
10.2 BUYER. Buyer agrees to hold harmless, indemnify and defend Seller from
and against any and all loss, claim, damage, liability or expense (including,
but not limited to, reasonable attorneys' fees and costs) arising out of or
occurring as a result of any breach by Buyer of any of its covenants,
representations or warranties hereunder, or any liability of Buyer. Such
indemnification shall include any claims pertaining to events or actions
occurring after the date of Closing. Except with respect to obligations arising
under this SECTION 10.2 as a result of a breach by Buyer of SECTION 3.1, SECTION
7.2 or SECTION 7.3, respectively, the liability of Buyer under this SECTION 10.2
shall not collectively exceed $5,000.00.
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ARTICLE XI.
CLOSING
11.1 CLOSING. Closing shall occur at 9:00 a.m. on Friday March 30, 2001 at
the law offices of Xxxxx Xxxx LLP, Two North Central Avenue, Suite 2200,
Phoenix, Arizona, or on a date that is not later than ten (10) business days
after the Court enters the Section 363 Order and the Section 365 Order;
provided, however, that the Closing must occur concurrently with or subsequent
to the closing of the transaction pursuant to which Buyer is purchasing the Real
Property from EPI.
11.2 TIME IS OF THE ESSENCE. Time is of the essence for the Closing of this
transaction and if such Closing does not occur as provided in SECTION 11.1
above, a new Closing Date shall be set for the next business day thereafter, or
as soon as practicable.
ARTICLE XII.
PRORATIONS.
The following costs and expenses shall be prorated as of the Closing Date:
12.1 Personal property taxes, sales taxes and any other assessments related
to the Purchased Assets;
12.2 Charges for utilities servicing the School, including, without
limitation, charges or gas, electricity, water, sewer, cable television, and
telephone services; and
12.3 Any other reasonable expenses approved in writing by Buyer and prepaid
by Seller related to the operation of the School.
The amount of any prorations shall be computed by Buyer with the assistance
of Seller. At Closing, Buyer shall pay to Seller or Seller shall pay to Buyer,
as the case may be, an amount equal to the net proration so determined.
ARTICLE XIII.
CONDITIONS PRECEDENT TO BUYER'S DUTY TO CLOSE
Buyer shall have no duty to close, and no obligation hereunder, unless and
until each and every one of the following conditions precedent have been fully
and completely satisfied:
13.1 CONTINUED TRUTH OF WARRANTIES. All of the representations and
warranties of Seller contained herein shall continue to be true and correct at
Closing.
13.2 PERFORMANCE OF OBLIGATIONS. Seller shall have fully performed or
tendered performance of each and every one of its obligations hereunder which by
its terms is capable of performance before Closing.
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13.3 DELIVERY OF CLOSING DOCUMENTS. Seller shall have tendered delivery to
Buyer of all the documents, in form and substance reasonably satisfactory to
Buyer, required to be delivered to Buyer by Seller on or before Closing pursuant
to this Agreement.
13.4 LITIGATION. No lawsuit, administrative proceedings or other legal
action shall have been filed against Seller as of the Closing Date which seeks
to restrain or enjoin Buyer's acquisition of the Purchased Assets, or the
assumption of the Assumed Contracts.
13.5 REAL PROPERTY. Buyer has purchased the Real Property from EPI.
13.6 PAYMENT. Seller pays to Buyer in immediately available funds the
amount of One Hundred Thousand and No/100 Dollars ($100,000.00) as set forth in
SECTION 4.1 above.
13.7 COURT ORDERS. The Court shall have entered the Section 363 Order and
the Section 365 Order; provided, however, that Buyer shall not have the right to
not close this transaction solely because the Section 365 Order approves
Seller's decision to reject the Lease.
ARTICLE XIV.
CONDITIONS PRECEDENT TO SELLER'S DUTY TO CLOSE
Seller shall have no duty to close this transaction unless and until each
and every one of the following conditions precedent have been fully and
completely satisfied:
14.1 CONTINUED TRUTH OF WARRANTIES. All of the representations and
warranties of Buyer contained herein shall continue to be true and correct at
Closing.
14.2 PERFORMANCE OF OBLIGATIONS. Buyer shall have fully performed or
tendered substantial performance of each and every one of its obligations
hereunder which by its terms is capable of performance before Closing.
14.3 DELIVERY OF CLOSING DOCUMENTS. Buyer shall have tendered delivery to
Seller of all the documents, in form and substance reasonably satisfactory to
Buyer, required to be delivered to Seller by Buyer on or before Closing pursuant
to this Agreement.
14.4 LITIGATION. No lawsuit, administrative proceedings or legal action
other than the Chapter 11 Case shall have been filed by or against Seller as of
the Closing Date, which seeks to restrain or enjoin Seller's sale of the
Purchased Assets or the assumption of the Assumed Contracts.
14.5 COURT ORDERS. The Court shall have entered the Section 363 Order and
the Section 365 Order; provided, however, that Buyer shall not have the right to
not close this transaction solely because the Section 365 Order approves
Seller's decision to reject the Lease.
14.6 PURCHASE PRICE. The Buyer pays to Seller in immediately available
funds the amount of Thirty Thousand and No/100 Dollars ($30,000.00) as set forth
in SECTION 4.1 above.
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14.7 MECHANIC'S LIEN. Buyer shall have assumed the Mechanic's Lien and
agrees to fully and faithfully perform all duties and obligations, due or owing
after the Closing, of Seller with respect to the Mechanic's Lien in an amount
not to exceed Eighteen Thousand and No/100 Dollars ($18,000.00).
14.8 DELINQUENT REAL PROPERTY TAXES. At Closing, Buyer shall assume and
assign and Seller shall accept said assignment of the delinquent real property
taxes on the Eagan Property in an amount not to exceed Eighty-Four Thousand and
No/100 Dollars ($84,000.00).
ARTICLE XV.
ITEMS TO BE DELIVERED AT CLOSING BY SELLER
At Closing, Seller shall, unless waived in writing by Buyer, deliver to
Buyer the following items, each in form and substance reasonably acceptable to
Buyer and Buyer's counsel:
15.1 XXXX OF SALE. A duly executed xxxx of sale selling, assigning,
transferring, and conveying the Purchased Assets.
15.2 CERTIFIED RESOLUTION. A copy of the resolution of the Board of
Directors of Seller authorizing the execution and performance of this Agreement.
15.3 REPRESENTATIONS AND WARRANTIES. A certificate signed by an appropriate
representative of Seller to the effect that all the representations and
warranties of Seller contained herein are true and correct as of Closing.
ARTICLE XVI.
ITEMS TO BE DELIVERED AT CLOSING BY BUYER
At Closing, Buyer shall, unless waived in writing by Seller, deliver the
following items, each in form and substance reasonably acceptable to Seller and
Seller's counsel, to Seller:
16.1 CERTIFIED RESOLUTION. A copy of the resolutions of the Executive
Director of Buyer or other appropriate representative(s) authorizing the
execution and performance of this Agreement.
16.2 REPRESENTATIONS AND WARRANTIES. A certificate signed by an appropriate
representative of Buyer to the effect that all the representations and
warranties of Buyer contained herein are true and correct as of Closing.
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ARTICLE XVII.
MISCELLANEOUS
17.1 RIGHT TO BID. Buyer acknowledges and understands that the Court may
consider higher and better offers. Notwithstanding, the parties agree that the
Purchased Assets and Assumed Liabilities, collectively, shall be subject to
higher and better offers.
17.2 FURTHER ASSURANCES. Each party shall, at any time after Closing,
execute and deliver to the other party all such additional instruments of
conveyance and assignments, certificates or similar documents and take all such
further actions as such other party may reasonably request.
17.3 NO ADMISSIONS. Nothing in this Agreement shall be, or shall be
construed to be, an admission of liability by the parties hereto to any other
person, party or entity.
17.4 NO OTHER AGREEMENTS. This Agreement, and all agreements delivered as
part of the Closing contemplated herein, constitute the entire agreement between
the parties with respect to its subject matter. All prior and contemporaneous
negotiations, proposals and agreements between the parties are superseded by
this Agreement. Any changes to this Agreement must be agreed to in writing
signed by both parties.
17.5 WAIVER. Either party may waive the performance of any obligation owed
to it by the other party hereunder for the satisfaction of any condition
precedent to the waiving party's duty to perform any of its covenants, including
its obligations to Close. Any such waiver shall be valid only if contained in a
writing signed by the waiving party.
17.6 NOTICES. Any notices required or allowed in this Agreement shall be
effectively given if placed in a sealed envelope, postage prepaid, and deposited
in the United States mail, registered or certified, addressed as follows:
To Seller: Xxxxxxx Xxxxx
The TesseracT Group, Inc.
0000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Copy To: Xxxxxx X. Xxxxxx, Esq.
Xxxxx Xxxx LLP
Xxx Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
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To Buyer: Tesseract of Eagan, Inc.
c/o Xxxxxxxxx Xxxxx & Associates
Minnesota Center-Suite 1340
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xx. Xxxx Xxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Copy To: Xxx Xxxxx, Esq.
Xxxxxx Xxxxxxx
0000 X. Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000-0000
17.7 BROKER AND FINDERS. Each of the parties hereto represents and warrants
to the other that it has not employed or retained any broker or finder in
connection with the transactions contemplated by this Agreement nor has it had
any dealings with any person which may entitle such person to a fee or
commission from any party hereto. Each of the parties shall indemnify and hold
the other harmless for, from and against any claim, demand or damage whatsoever
by virtue of any arrangement or commitment made by it with or to any person that
may entitle such person to any fee or commission from the other party to this
Agreement.
17.8 RISK OF LOSS. The risk of loss, damage, or destruction of the
Purchased Assets shall be borne by Seller until Closing. In the event any loss
or damage to or taking of any such Purchased Assets is material in the context
of this transaction and occurs before Closing, Seller shall immediately notify
Buyer of the nature and extent of such loss, damage or taking, and Buyer shall,
at its option, by written notice to Seller, either terminate this Agreement
without further liability or obligation to Seller, or Buyer may proceed with
this transaction on the terms and conditions mutually agreeable to the parties,
including any adjustment in the Purchase Price.
17.9 THIRD-PARTY BENEFICIARY. Nothing contained herein shall create or give
rise to any third-party beneficiary rights for any individual or entity as a
result of the terms and provisions of this Agreement.
17.10 COURT JURISDICTION. Upon the execution hereof, the parties will file
this Agreement with the Court. Upon approval thereof, the Court will have
continuing jurisdiction to resolve any and all disputes that may arise under
this Agreement.
17.11 RELATIONSHIP OF PARTIES. The relationship of Seller and Buyer shall
be that of independent entities and neither shall be deemed to be the agent of
the other.
17.12 CHOICE OF LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Arizona and, as applicable, the
Bankruptcy Code.
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17.13 PARAGRAPH HEADINGS. The Section, Article and paragraph headings
contained herein are for convenience only and shall have no substantive bearing
on the interpretation of this Agreement.
17.14 RULES OF INTERPRETATION. The following rules of interpretation shall
apply to this Agreement, the Schedules hereto and any certificates, reports or
other documents or instruments made or delivered pursuant to or in connection
with this Agreement, unless otherwise expressly provided herein or therein and
unless the context hereof or thereof clearly requires otherwise:
17.14.1 A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time in
accordance with its terms, and if a term is said to have the meaning assigned to
such term in another document or agreement and the meaning of such terms therein
is amended, modified or supplemented, then the meaning of such term herein shall
be deemed automatically amended, modified or supplemented in a like manner.
17.14.2 References to the plural include the singular, the singular
the plural and the part the whole.
17.14.3 The words "include," "includes," and "including" are not
limiting.
17.14.4 A reference to any law includes any amendment or modification
to such law, which is in effect on the relevant date.
17.14.5 A reference to any person or entity includes its successors,
heirs and permitted assigns.
17.14.6 The words "hereof," "herein," "hereunder," and similar terms
in this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement.
17.14.7 All Schedules to this Agreement constitute material terms of
this Agreement and are incorporated fully into the terms of this Agreement.
17.15 TIME IS OF THE ESSENCE. Time is of the essence in the performance and
observance of all obligations and duties under this Agreement.
17.16 ATTORNEY FEES. Each party shall bear its own legal fees and costs
incurred in the negotiation and closing of this transaction. In the event of a
dispute arising between the parties under this Agreement, the prevailing party
shall be entitled to reasonable attorneys' fees and costs of suit from the
non-prevailing party.
17.17 COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement maybe executed in
any number of counterparts, each of which shall be an original, but all of such
counterparts shall together constitute but one and the same instrument. Delivery
of an executed counterpart of this Agreement by telefacsimile shall be equally
as effective as delivery of a manually executed counterpart of this Agreement.
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Any party delivering an executed counterpart of this Agreement by telefacsimile
also shall deliver a manually executed counterpart of this Agreement but the
failure to deliver a manually executed counterpart shall not affect the
validity, enforceability, and binding effect of this Agreement.
IN WITNESS WHEREOF, the parties hereto have set their hands effective the
date set forth above.
THE TESSERACT GROUP, INC.,
a Minnesota corporation.
By:
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Name:
-------------------------------------------
Its:
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SELLER
TESSERACT OF EAGAN, INC., a Minnesota
non-profit corporation.
By:
-------------------------------------------
Name:
-------------------------------------------
Its:
-------------------------------------------
BUYER
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