Exhibit 10.1
PURCHASE AND SALE AGREEMENT
(PARADISE VALLEY SCHOOL)
This PURCHASE AND SALE AGREEMENT (the "Agreement") is entered into as of
the 26th day of December, 2000, 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 THE PARADISE VALLEY
PRIVATE SCHOOL FOUNDATION, an Arizona non-profit corporation ("Buyer").
RECITALS
A. Seller operates that certain private school and preschool commonly known
as the "Paradise Valley TesseracT School" located at 0000/0000 Xxxx Xxxxxxxxxx
Xxxxx Xxxx, Xxxxxxxx Xxxxxx, Xxxxxxx and a preschool ("Preschool") located at
0000 X. Xxxx Xxxx Xxxxxx, Xxxxxxx, Xxxxxxx (collectively referred to as 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 and Seller further desire, subject to the approval of the Court,
to enter into such other agreements and arrangements that effectuate the orderly
transition of the School from Seller to Buyer.
E. Buyer has completed its due diligence of the School and all other
matters addressed in this Agreement.
F. Prior to or contemporaneously with the closing of this transaction,
Private School Real Estate LLC ("Private School") intends on purchasing the real
property on which the School is situated, and the related improvements and
fixtures from EPI (defined below).
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G. 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 those
unexpired leases and other executory contracts, which Buyer will assume
hereunder, which are specifically set forth on SCHEDULE 1.1 attached hereto and
the Preschool Lease. [SCHEDULE WILL INCLUDE ALL TEACHERS' CONTRACTS AND OTHER
CONTRACTS THAT BUYER SPECIFICALLY AGREES TO ASSUME.]
1.2 BUSINESS. The term "Business" shall mean Seller's operations conducted
under the name "TesseracT," "The TesseracT Group, Inc.," or "Paradise Valley
TesseracT School," at the School and at any other location within or outside the
State of Arizona.
1.3 CLAIM. The term "Claim" shall be given the same meaning as provided to
such term under Bankruptcy Codess.101(5).
1.4 CLOSING. The term "Closing" shall mean the completed exchange of: (i)
Closing documents set forth in Articles XIV and XV below, together with the
simultaneous conveyance by Seller to Buyer of the Purchased Assets; (ii) the
payment by Buyer to Seller of the Purchase Price 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 CLOSING DATE. The term "Closing Date" shall mean the date on which the
Closing occurs which shall not be later than January 15, 2001, unless such date
is extended in accordance with Article X.2.
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1.6 EPI. The term "EPI" shall mean Education Property Investors, Inc., a
Nevada corporation.
1.7 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 on December 10, 2000 as evidenced by
SCHEDULE 1.7 attached hereto, the inventory list prepared by Seller.
1.8 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 Paradise Lane Property from EPI.
1.9 PARADISE LANE PROPERTY. The term "Paradise Lane Property" shall mean
that certain real property located in Paradise Valley, Arizona, at which Seller
operates the charter school commonly referred to as the "Paradise Lane TesseracT
Charter School."
1.10 PREPAID TUITION AND DEPOSIT CLAIMS. The term "Prepaid Tuition and
Deposit Claims" shall mean all Claims against Seller and its estate for prepaid
tuition and deposits provided on behalf of students at the School through the
Closing Date; provided, however, that it shall not include the Xxxxxxxx (as
defined in Section 7.5 below).
1.11 PRESCHOOL. The term "Preschool" shall mean the preschool presently
operated by Seller at the Preschool Facility.
1.12 PRESCHOOL FACILITY. The term "Preschool Facility" shall mean the
facility located at 0000 Xxxx Xxxx Xxxx Xxxxxx, Xxxxxxx Arizona.
1.13 PRESCHOOL LEASE. The term "Preschool Lease" shall mean that certain
Agreement to Lease between Seller and the St. Xxxxxx Antiochian Orthodox Church
dated March 30, 1998, pursuant to which Seller leases the Preschool Facility.
1.14 REAL PROPERTY PURCHASE AGREEMENT. The term "Real Property Purchase
Agreement" shall mean the written agreement between Private School and EPI that
provides for EPI's sale, and Private School's purchase, of the Real Property.
1.15 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 0000/0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxx Xxxxxx, Arizona.
1.16 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.
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1.17 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 as it relates to the Real Property; provided,
however, that the Section 365 Order shall not approve Seller's decision to
reject the Lease as it relates to the Paradise Lane Property unless Seller, in
its sole and absolute discretion which may be unreasonably withheld, hereafter
decides to reject the Lease as it relates to the Paradise Lane Property; and
(ii) assume the Assumed Contracts, the form of which shall be agreed to by the
parties hereto.
1.18 EMPLOYEES' ACCRUED LIABILITIES. The term "Employees' Accrued
Liabilities" shall mean the liabilities of Seller for accrued compensation
arising under Seller's employment obligations with its employees, including the
obligations arising from its contracts with the School's teachers, as of the
Closing Date, which are specifically set forth on SCHEDULE 1.18 attached hereto
and totals APPROXIMATELY $50,000.00. The Employees' Accrued Liabilities amounts
set forth on SCHEDULE 1.18 are effective as of November 30, 2000, and the
parties will agree to an amended SCHEDULE 1.18 at the Closing which shall set
forth the actual amount of the Employees' 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, 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, any and
all other tangible property utilized by Seller in connection with the Business
conducted at the School and Preschool located those facilities, including, but
not limited to, supplies-on-hand.
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2.1.3 RECORDS, FILES AND RELATED MATERIALS. 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 and the Preschool.
2.1.4 GOODWILL. All of Seller's goodwill that relates to the School
and the Preschool, including the telephone numbers of 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. Except as provided herein, 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 PRESCHOOL LICENSE. Seller's license issued by the Arizona
Department of Education to operate the Preschool.
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"): (i) the Assumed Contracts; provided, however, that Buyer shall
only be obligated to pay, perform, or discharge in accordance with their terms
such obligations thereunder that arise on or after the Closing Date; (ii) the
Employees' Accrued Liabilities, and (iii) the normal and customary obligations
relating to the operation of the School. Buyer shall fully and faithfully
perform all duties and obligations, due or owing after Closing, of Seller with
respect to the Assumed Liabilities.
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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.
ARTICLE IV
TERMS OF PAYMENT
4.1 PAYMENT DUE AT CLOSING. At Closing, Buyer shall pay to Seller an amount
equal to Fifty Thousand Dollars ($50,000) (the "Purchase Price") less the amount
of the Deposit delivered by Buyer to Seller in accordance with Section 4.2
below, in immediately available funds.
4.2 DEPOSIT. Contemporaneously with the execution of this Agreement, Buyer
shall deliver into escrow a cash deposit in the amount of $25,000.00 (the
"Deposit"), which shall be refundable to Buyer unless Buyer refuses to close the
transactions contemplated in this Agreement, except that the Deposit shall be
refundable to Buyer if Private School's transaction with EPI to purchase the
Real Property does not close and such failure to close is not the result of a
default by Private School under the Real Property Purchase Agreement. At
Closing, the Deposit shall be transferred to Seller as payment for part of the
Purchase Price.
4.3 DETERMINATION. At or prior to thirty (30) days after the Closing, Buyer
and Seller shall mutually agree to an allocation of the Purchase Price among the
Purchased Assets in a reasonable manner, and each party agrees to file all
federal, state and local tax returns in conformity with such allocation.
ARTICLE V
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:
5.1 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.
5.2 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.
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5.3 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.
5.4 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 VI
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:
6.1 ORGANIZATION. Buyer is a non-profit corporation duly organized, validly
existing and in good standing under the laws of the State of Arizona.
6.2 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.
6.3 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. 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.
ARTICLE VII
OTHER COVENANTS
7.1 CURRICULUM. Buyer shall have the fully paid up, non-exclusive,
perpetual right to use Seller's curriculum in its post-Closing operation of the
School and the Preschool, including, without limitation, materials, and
instruction techniques of Seller.
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7.2 TESSERACT NAME. Buyer shall have the non-exclusive, perpetual right to
use the trademark and trade name "TesseracT" as part of the full name of the
School and the Preschool and any two (2) other facilities in the event that the
School and/or the Preschool are closed or relocated. Buyer may prepare for
Seller's execution a licensing agreement consistent with the terms herein.
7.3 PRESCHOOL. Buyer shall be responsible for all costs and expenses
associated with obtaining a license from the Arizona Department of Education
("ADE") to operate the Preschool (the "Preschool License"), including, but not
limited to, any and all facility-related expenses required by ADE. Seller shall
reasonably cooperate with Buyer in its efforts to obtain the Preschool License.
The sale of the Purchased Assets and assumption of the Assumed Liabilities
contemplated in this agreement is not conditioned upon Buyer's obtaining the
Preschool License. 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 Buyer's inability to obtain a Preschool License.
7.4 FORBEARANCE OF CLAIMS FOR PREPAID TUITION AND DEPOSITS. Buyer agrees
that the Buyer, all its officers, directors, trustees, agents and employees
shall (i) forebear from taking any action against Seller and its estate to
receive payment on the Prepaid Tuition and Deposit Claims and (ii) use their
best efforts to seek the forbearance of any holder of a Prepaid Tuition and
Deposit Claim to take any action against Seller and its estate to receive
payment on the Prepaid Tuition and Deposit Claims. This forbearance obligation
and covenant shall expire at the earlier of (i) distribution of such claims
pursuant to a Chapter 11 plan in the Sellers bankruptcy case; (ii) distribution
by a Chapter 7 trustee in the Sellers bankruptcy case or (iii) June 30, 2001.
This forbearance obligation shall terminate without order of the United States
Bankruptcy Court for the District of Arizona if the Seller fails to file a plan
by March 15, 2001 or the Closing does not occur by the Closing Date. If Seller
enters into any other agreement to sell its private or charter school assets to
another buyer and that agreement contains a forbearance period more favorable to
that other buyer than is offered to Buyer pursuant to 7.4 of this agreement,
then Buyer automatically shall be entitled to exercise the more favorable
forbearance terms as that of the other buyer.
7.5 XXXXXXXX. As of the date hereof, Seller estimates that Seller has
approximately $161,000 in unearned revenues due on behalf of students at the
School which has been billed, but is as of yet uncollected, by Seller for
December 2000. These xxxxxxxx and all additional xxxxxxxx hereafter through the
Closing Date which are collected and received by Seller (collectively the
"Xxxxxxxx") shall be accounted for by the Seller and deposited forthwith into a
separately segregated bank account jointly in the Seller's and Creditors
Restructuring Officer of the Unsecured Creditors Committee (in the Seller's
bankruptcy case) name. On the Closing Date, Seller shall turn the funds in the
segregated bank account (the "Segregated Funds") over to Buyer. Buyer may only
withdraw Segregated Funds and commingle such cash with its other funds, when
Buyer has earned the Segregated Funds by providing the related educational
services to the party who paid such funds to Seller (the "Payor"); provided,
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however, that Buyer shall be required to return the unearned amount of such
Segregated Funds to Payor, pursuant to the terms of the agreement wherein the
funds were paid by Payor, upon written demand if Payor decides not to do
business with Buyer any time after the Closing Date. Buyer acknowledges and
agrees that Seller does not in any way guarantee the collectability of any of
the Xxxxxxxx. No student shall be disenrolled from School by either party for
failure to pay any Billing.
7.6 REJECTION OF LEASE OF REAL PROPERTY. Subject to the definition of
Section 365 Order stated herein and subject to the acquisition of the Real
Property and closing the Real Property Purchase Agreement by the Private School,
the Lease of the Real Property shall be rejected by Seller at the earlier of (i)
the Closing or (ii) February 5, 2001. This provision shall be included in the
Section 363 Order.
ARTICLE VIII
EMPLOYEES
8.1 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.
8.2 EMPLOYMENT OF SELLER'S EMPLOYEES AT THE SCHOOL. Buyer agrees to offer
to hire all of Seller's Employees as of the Closing Date (the "Transferred
Employees"). From and after the Closing Date, Buyer shall be solely responsible
for payment, when and if due, of all claims by or obligations to Transferred
Employees including, but not limited to, the Employees' Accrued Liabilities, and
any accrued vacation pay, sick leave, or bonuses earned after the Closing Date.
8.3 EMPLOYEE SOLICITATIONS. Buyer shall be entitled to reasonable access to
all employees related to the School for purposes of interviewing these
individuals.
8.4 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.
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ARTICLE IX
INDEMNITIES
9.1 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 9.1 collectively
exceed $5,000.
9.2 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 in connection with 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..
ARTICLE X
CLOSING
10.1 CLOSING. Closing shall occur at the law offices of Xxxxxxx & Xxxxx
Xxxxxxx Xxxx, LLP, in Phoenix, Arizona, 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 Private School is
purchasing the Real Property from EPI and by no later than January 15, 2001.
10.2 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 10.1
above, a new Closing Date shall be set for the next business day thereafter, or
as soon as practicable.
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ARTICLE XI
PRORATIONS
The following costs and expenses shall be prorated as of the Closing Date:
11.1 Personal property taxes, sales taxes and any other assessments related
to the Purchased Assets;
11.2 Charges for utilities servicing the School, including, without
limitation, charges or gas, electricity, water, sewer, cable television, and
telephone services; and
11.3 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 XII
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:
12.1 CONTINUED TRUTH OF WARRANTIES. All of the representations and
warranties of Seller contained herein shall continue to be true and correct at
Closing.
12.2 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.
12.3 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.
12.4 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.
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12.5 REAL PROPERTY. Private School has purchased the Real Property from
EPI.
12.6 EMPLOYEES' ACCRUED LIABILITIES. Seller pays over to Buyer cash in the
amount of the Employees' Accrued Liabilities in the amount as agreed to at the
Closing, and as set forth on the amended SCHEDULE 1.18.
12.7 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 as it relates to the Paradise Lane
Property in addition to the Real Property.
ARTICLE XIII
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:
13.1 CONTINUED TRUTH OF WARRANTIES. All of the representations and
warranties of Buyer contained herein shall continue to be true and correct at
Closing.
13.2 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.
13.3 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.
13.4 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.
13.5 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 as it relates to the Paradise Lane
Property in addition to the Real Property.
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ARTICLE XIV
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:
14.1 XXXX OF SALE. A duly executed xxxx of sale selling, assigning,
transferring, and conveying the Purchased Assets.
14.2 CERTIFIED RESOLUTION. A copy of the resolution of the Board of
Directors of Seller authorizing the execution and performance of this Agreement.
14.3 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 XV
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:
15.1 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.
15.2 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.
15.3 THE PURCHASE PRICE. The Purchase Price.
ARTICLE XVI
MISCELLANEOUS
16.1 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 the subject of
higher and better offers.
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16.2 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.
16.3 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.
16.4 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.
16.5 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.
16.6 PUBLIC ANNOUNCEMENTS. Through the Closing, no announcements to the
news media of this Agreement shall have been made unless Buyer and Seller shall
have mutually agreed on the timing, distribution, and contents of such
announcements, except as may be required by law. The parties hereto acknowledge
and understand that this Agreement will be filed with the Court promptly upon
its execution by the parties hereto.
16.7 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: Xxxxxx Xxxxxxx, Ph.D.
The TesseracT Group, Inc.
0000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Copy To: Xxxxxx X. Xxxxxx, Esq.
Xxxxxxx & Xxxxx Xxxxxxx Xxxx, LLP
Xxx Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
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To Buyer: Xxxxxx Xxxxxx
The Paradise Valley Private School Foundation
0000 X Xxxxxx Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxx 00000
Copy To: Xxxxx Xxxxx, Esq.
Sacks Tierney P.A.
0000 X Xxxxxxxxxx Xxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
16.8 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.
16.9 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.
16.10 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.
16.11 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.
16.12 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.
16.13 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.
15
16.14 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.
16.15 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:
16.15.1 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.
16.15.2 References to the plural include the singular, the singular
the plural and the part the whole.
16.15.3 The words "include," "includes," and "including" are not
limiting.
16.15.4 A reference to any law includes any amendment or modification
to such law, which is in effect on the relevant date.
16.15.5 A reference to any person or entity includes its successors,
heirs and permitted assigns.
16.15.6 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.
16.15.7 All Schedules to this Agreement constitute material terms of
this Agreement and are incorporated fully into the terms of this Agreement.
16.16 TIME IS OF THE ESSENCE. Time is of the essence in the performance and
observance of all obligations and duties under this Agreement.
16.17 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.
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16.18 COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement may be 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.
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 /s/
-------------------------------------
Its
------------------------------------
SELLER
THE PARADISE VALLEY PRIVATE SCHOOL
FOUNDATION, an Arizona non-profit
corporation
By /s/
-------------------------------------
Its
------------------------------------
BUYER
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LIST OF EXHIBITS
Schedule 1.1 Assumed Contracts
Schedule 1.7 Equipment
Schedule 1.18 Employees' Accrued Liabilities
SCHEDULE 1.1
(ASSUMED CONTRACTS)
(TO BE COMPLETED BY THE PARTIES)
EXHIBIT 1.7
(EQUIPMENT)
SCHEDULE 1.18
(EMPLOYEES' ACCRUED LIABILITIES)
(To Be Completed By The Parties On Or Before The Closing Date)
