EXECUTION COPY
ASSET PURCHASE AGREEMENT
by and among
COUNTRY TONITE BRANSON, LLC
(a Nevada limited liability company),
ON STAGE ENTERTAINMENT, INC.
(a Nevada corporation),
BOUNCEBACK XXXXXXXXXXXX.XXX, INC.
(a Minnesota corporation),
COUNTRY TONITE ENTERPRISES, INC.
(a Nevada corporation),
and
CRC OF BRANSON, INC.
(a Missouri corporation)
Section Page
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1. Definitions..........................................................5
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2. Purchase and Sale of the Business and Assets........................11
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2.1 The Purchased Assets.......................................11
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2.2 Excluded Assets............................................12
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2.3 Assumed Liabilities........................................12
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2.4 Excluded Liabilities.......................................13
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2.5 Consent of Third Parties...................................13
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2.6 Purchase Price.............................................14
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2.7 Allocation of the Purchase Price...........................15
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3. Closing.............................................................15
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3.1 Location; Date.............................................15
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3.2 Closing Deliveries.........................................15
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4. Representations and Warranties of the Selling Entities..............16
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4.1 Corporate Status...........................................16
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4.2 Authorization..............................................16
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4.3 Consents and Approvals.....................................17
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4.4 Financial Statements.......................................17
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4.5 Title to Assets and Related Matters........................17
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4.6 Real Property..............................................18
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4.7 Certain Personal Property..................................19
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4.8 Personal Property Leases...................................19
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4.9 Inventory..................................................19
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4.10 Price Guarantees...........................................19
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4.11 Liabilities................................................19
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4.12 Taxes......................................................20
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4.13 Subsidiaries...............................................20
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4.14 Legal Proceedings and Compliance with Law..................21
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4.15 Contracts..................................................22
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4.16 No Selling Entity is in Default under any Contract.........23
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4.17 Insurance..................................................23
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4.18 Intellectual Property......................................23
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4.19 Employee Relations.........................................24
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4.20 ERISA......................................................25
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4.21 Absence of Certain Changes.................................27
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4.22 Customers..................................................28
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4.23 Finder's Fees..............................................28
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4.24 Additional Information.....................................28
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4.25 Transactions with Affiliates...............................28
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4.26 Full Disclosure............................................29
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5. Representations and Warranties of On Stage..........................29
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5.1 Corporate Status...........................................29
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5.2 Authorization..............................................29
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5.3 Consents and Approvals.....................................29
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5.4 Finder's Fees..............................................30
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6. Certain Agreements..................................................30
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6.1 Access.....................................................30
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6.2 Update Schedules...........................................30
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6.3 Financial Information......................................30
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6.4 Restrictive Covenants......................................30
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6.5 Required Consents, Regulatory and other Approvals..........31
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6.6 Publicity..................................................32
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6.7 Satisfaction of Liabilities................................32
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6.8 Employee Benefit Matters...................................32
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6.9 Business Financial Statements.............................32
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6.10 Employment and Employment Benefits.........................33
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7. Conduct of the Business Prior to the Closing........................33
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7.1 Operation in Ordinary Course...............................34
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7.2 Business Organization......................................34
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7.3 Corporate Organization.....................................34
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7.4 Business Restrictions......................................34
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8. Conditions Precedent to Obligations of On Stage.....................35
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8.1 Representations and Warranties.............................35
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8.2 Agreements, Conditions and Covenants.......................35
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8.3 Officers' Certificate......................................35
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8.4 Required Consents and Approvals............................35
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8.5 Third Party Consents.......................................36
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8.6 Legality...................................................36
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8.7 Title Insurance............................................36
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8.8 Real Property Leases.......................................37
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8.9 Opinion of Counsel.........................................37
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8.10.....Board Approval.............................................36
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8.11 Collateral Agreements......................................37
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9. Conditions Precedent to Obligations of the Selling Entities.........37
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9.1 Representations and Warranties.............................37
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9.2 Agreements, Conditions and Covenants.......................38
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9.3 Officer's Certificate......................................38
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9.4 Legality...................................................38
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9.5 Opinion of Counsel.........................................38
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9.6 Collateral Agreements......................................38
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10. Indemnification.....................................................38
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10.1 Indemnification by the Selling Entities....................38
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10.2 Indemnification by On Stage................................39
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10.3 Limitations on Liability...................................39
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10.4 Survival...................................................40
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10.5 Indemnification Procedure..................................40
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10.6 Exception to Limitations...................................42
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10.7 Payment of Indemnification Obligations.....................42
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10.8 Right to Set Off...........................................42
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11. Termination.........................................................42
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11.1 Grounds for Termination....................................42
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11.2 Effect of Termination......................................44
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12. Payment of Expenses; Bulk Sales Act; Sales and Transfer Taxes.......45
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13. Contents of Agreement...............................................45
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14. Amendment; Parties in Interest; Assignment; Etc.....................45
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15. Interpretation......................................................45
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16. Remedies............................................................46
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17. Notices.............................................................46
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18. Governing Law.......................................................47
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19. Consent to Jurisdiction; Service of Process; Etc....................47
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20. Further Assurances..................................................48
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21. Exhibits; Schedules.................................................48
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22. No Benefit to Others................................................48
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23. Counterparts........................................................48
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Exhibits
A Employment Agreement
B-1 Form of $650,000 Secured Short Term Note
B-2 Form of $2,800,000 Secured Promissory Note
C Form of Performance Contract
D Form of Security Agreement
Schedules
2.1 Permitted Encumbrances
2.1(a) Real Property Leased
2.1(b) Equipment and Other Tangible Personal Property
2.1(c) Contracts of the Business
2.1(e) Permits
2.1(f) Intellectual Property
2.1(i) Prepaid Expenses
2.1(j)(i)Software
2.1(j)(ii)Third Party Software Licenses
2.1(k) Other Intangible Assets
2.2 Excluded Assets
4.3 Consents and Approvals
4.4 Financial Statements
4.5 Title to Assets and Related Matters
4.6 Real Property
4.7 Certain Personal Property
4.8 Personal Property Leases
4.9 Inventory
4.10 Product Warranties and Price Guarantees
4.11 Liabilities
4.12 Taxes
4.13 Subsidiaries
4.14(a) Legal Proceedings and Compliance with Law
4.14(b) Environmental Matters
4.14(d) Compliance with Permits
4.15 Contracts
4.17 Insurance
4.18 Intellectual Property
4.19 Employee Relations
4.20 ERISA
4.22 Customers
4.24 Additional Information
4.25 Transactions with Affiliates
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made as of the ____ day of January
2001, by and among Country Tonite Branson, LLC, a Nevada limited liability
company ("CTB"), On Stage Entertainment, Inc., a Nevada corporation ("On
Stage"), Bounce Back Xxxxxxxxxxxx.xxx, Inc., a Minnesota corporation ("BBT"),
Country Tonite Enterprises, Inc., a Nevada corporation ("CTE"), and CRC of
Branson, Inc., a Missouri corporation ("CRC of Branson", and together with CTE,
the "Selling Entities", and each individually, a "Selling Entity").
Certain other terms are used herein as defined below in Section 1 or
elsewhere in this Agreement.
Background
The Selling Entities desire to transfer to CTB the Purchased Assets (as
defined herein) in exchange for the assumption by CTB of the Assumed Liabilities
(as defined herein) and the payment by CTB of the Purchase Price (as defined
herein) in accordance with the terms and conditions set forth in this Agreement.
CTB desires to acquire the Purchased Assets and assume the Assumed Liabilities.
NOW, THEREFORE, in consideration of and reliance on the respective
representations, warranties and covenants contained herein and intending to be
legally bound hereby, the parties hereto agree as follows:
1. Definitions. For convenience, certain terms used in more than one part of
this Agreement are listed in alphabetical order and defined or referred to below
(such terms as well as any other terms defined elsewhere in this Agreement shall
be equally applicable to both the singular and plural forms of the terms
defined).
"$650,000 Secured Short Term Note" means a promissory note from CTB to
the benefit of the Selling Entities in the principal amount of $650,000, which
shall accrue interest at the rate of ten percent (10%) per annum from the
Closing Date (payable in arrears), is secured by the Purchased Assets and which
shall mature on or before February 15, 2001, a true and correct form of which is
attached hereto as "Exhibit B-1" and is secured by the Security Agreement.
"$2,800,000 Secured Promissory Note" means a promissory note from CTB
to the benefit of the Selling Entities in the principal amount of $2,800,000,
which shall accrue interest at the rate of ten percent (10%) per annum from the
Closing Date (payable monthly, in arrears), is secured by the Purchased Assets
and which shall mature on or before July 31, 2001, a true and correct form of
which is attached hereto as "Exhibit B-2" and is secured by the Security
Agreement.
"Affiliates" means, with respect to a particular party, Persons
controlling, controlled by or under common control with that party, as well as
the officers, directors and majority-owned Persons of that party and of its
other Affiliates. For purposes of the foregoing, ownership, directly or
indirectly, of twenty percent (20%) or more of the voting stock or other equity
interest of a person shall be deemed to constitute control.
"Agreement" means this Agreement, including the Schedules and Exhibits
attached hereto.
"Assets" means all of the assets, properties and rights of every kind
and description, real and personal, tangible and intangible (including
goodwill), wherever situated and whether or not reflected in the most recent
Financial Statements, that are owned or possessed by a Selling Entity and relate
primarily to the Business.
"Assumed Liabilities" is defined in Section 2.3.
"Audited Financial Statements" is defined in Section 4.4.
"Balance Sheet" is defined in Section 4.4.
"Balance Sheet Date" is defined in Section 4.4.
"BBT Indemnified Party" is defined in Section 10.2.
"Benefit Plans" means all employee benefit plans of any Selling Entity
relating to the Business (including plans within the meaning of Section 3(3) of
ERISA) and any related or separate Contracts, plans, trusts, programs, policies,
arrangements, practices, customs and understandings, in each case whether formal
or informal, that provide benefits to any present or former employee of the
Business, or present or former beneficiary, dependent or assignee of any such
employee or former employee, including all incentive, bonus, deferred
compensation, vacation, holiday, medical, disability, share purchase or other
similar plans, policies, programs, practices or arrangements.
"BDO Xxxxxxx" means BDO Xxxxxxx, LLP, an independent certified public
accounting firm.
"Business" means collectively the business of the Selling Entities
conducted under the "Country Tonite" name, including the leasing and operation
of the Country Tonight Theater in Branson, Missouri, but specifically excluding
the ownership and operation of the Country Tonight production show based in
Pigeon Forge, Tennessee.
"Charter Documents" means an entity's certificate or articles of
incorporation, certificate defining the rights and preferences of securities,
articles of organization, general or limited
partnership agreement, certificate of limited partnership, joint venture
agreement or similar document governing the entity.
"Closing" is defined in Section 3.1.
"Closing Date" means the date of the Closing.
"CTB Indemnfied Party" is defined in Section 10.1.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Agreements" means the $2,800,000 Secured Note and Security
Agreement as the parties hereto shall enter into prior to the closing.
"Commission" means the United States Securities and Exchange
Commission.
"Commitments" is defined in Section 8.7.
"Confidential Information" means any confidential information or trade
secrets of the Business, including information and knowledge pertaining to
products and services offered, innovations, designs, ideas, plans, trade
secrets, proprietary information, know-how and other technical information,
advertising, marketing plans and systems, distribution and sales methods and
systems, sales and profit figures, customer and client lists, and relationships
with dealers, distributors, wholesalers, customers, clients, suppliers and
others who have business dealings with the Business.
"Contract" means any written or oral contract, agreement, lease, plan,
instrument or other document or commitment, arrangement, undertaking, practice
or authorization that is binding on any Person or its property under applicable
law.
"Copyrights" means registered copyrights, copyright applications and
unregistered copyrights.
"Court Order" means any judgment, decree, injunction, order or ruling
of any Federal, state, local or foreign court or governmental or regulatory body
or arbitrator or authority that is binding on any Person or its property under
applicable law.
"Customers" is defined in Section 4.22.
"Default" means (a) a breach, default or violation, (b) the occurrence
of an event that with or without the passage of time or the giving of notice, or
both, would constitute a breach, default or violation or cause an Encumbrance to
arise or (c) with respect to any Contract, the occurrence of an event that with
or without the passage of time or the giving of notice, or both, would give
rise to a right of termination, renegotiation or acceleration or a right to
receive damages or a payment of penalties.
"Encumbrances" means any lien, mortgage, security interest, pledge,
restriction on transferability or voting, defect of title or other claim, charge
or encumbrance of any nature whatsoever on any property or property interest.
"Environmental Condition" is defined in Section 4.14(b).
"Environmental Law" is defined in Section 4.14(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Escrow Account" means the $100,000 deposit money CTB has previously
deposited with Escrow Agent, along with the $250,000 deposit money CTB will
deposit by January 26, 2001 pursuant to Section 2.6(a)(ii) below, into Escrow
Agents' interest bearing client trust account number 0-000-000 at Commerce Bank
of Cherry Hill, New Jersey, for the benefit of account number 00-0000000.
"Escrow Agent" means Xxxxxxxx Xxxxxxxx Xxxxx & Xxxxx, LLP.
"Escrow Agreement" means that Escrow Agreement dated November 21, 2000
by and between BBT, On Stage and Escrow Agent.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" is defined in Section 2.2.
"Excluded Liabilities" is defined in Section 2.4.
"Financial Statements" is defined in Section 4.4.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Hazardous Substances" means (i) any "hazardous substances" as defined
by the federal Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. xx.xx. 9601 et seq., (ii) any "extremely hazardous substance,"
"hazardous chemical" or "toxic chemical" as those terms are defined by the
federal Emergency Planning and Community Right-to-Know Act, 42 U.S.C. xx.xx.
11001 et seq., (iii) any "hazardous waste" as defined under the federal Solid
Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42
U.S.C. xx.xx. 6901 et seq., (iv) any "pollutant" as defined under the federal
Water Pollution Control Act, 33 U.S.C. xx.xx. 1251 et seq., as any of such laws
in clauses (i) through (iv) may be amended from time to time, and (v) any
regulated substance or waste under any Laws or Court Orders that currently exist
or
that may be enacted, promulgated or issued in the future by any Federal, state
or local governmental authorities concerning protection of the environment.
"Indemnified Party" is defined in Section 10.5.
"Indemnifying Party" is defined in Section 10.5
"Intellectual Property" means any Copyrights, Patents, Trademarks,
trade names, technology rights and licenses, trade secrets, franchises, know-how
and formulae, inventions, designs, processes, drawings, specifications, patterns
and other intellectual property owned by or licensed to a Selling Entity
relating to the Business.
"Inventory" means any inventory, including raw materials, supplies,
work in process and finished goods.
"Knowledge" means the actual knowledge of a director, officer or other
employee, provided that such persons shall have made due and diligent inquiry of
those individuals whom such director, officer or other employee reasonably
believe would have actual knowledge of the matters represented.
"Law" means any statute, law, ordinance, regulation, order or rule of
any federal, state, local, foreign or other governmental agency or body or of
any other type of regulatory body, including those covering environmental,
energy, safety, health, transportation, bribery, record keeping, zoning,
anti-discrimination, antitrust, wage and hour, and price and wage control
matters.
"Liability" means any direct or indirect liability, indebtedness,
obligation, expense, claim, loss, damage, deficiency, guaranty or endorsement of
or by any Person, absolute or contingent, accrued or unaccrued, due or to become
due, liquidated or unliquidated.
"License Agreement" means that certain license agreement dated as of
April 26, 2000 by and between CTE and Country Tonite Theatre in Pigeon Forge,
Tennessee.
"Litigation" means any lawsuit, claim, action, dispute, investigation,
arbitration, inquiry, administrative or other proceeding or prosecution.
"Material Adverse Effect" means a material adverse effect on the
Business or the Purchased Assets, in each case taken as a whole, or the
financial condition or the results of operations of the Business, and when used
with respect to representations, warranties or conditions, means the individual
effect of the situation to which it relates and also the aggregate effect of all
similar situations unless the context indicates otherwise.
"Non-Assignable Contract" is defined in Section 2.5.
"Ordinary Course" or "ordinary course of business" means the ordinary
course of business that is consistent in nature and, where relevant, amount with
past practices.
"Patents" means all patents and patent applications.
"Permit" means any federal, state or local governmental permit,
license, registration, certificate of occupancy, approval and other
authorization.
"Person" means any natural person, corporation, partnership,
proprietorship, association, trust or other legal entity.
"Personal Property Leases" is defined in Section 4.8.
"Prorations" is defined in Section 2.6.
"Purchase Price" is defined in Section 2.6.
"Purchased Assets" is defined in Section 2.1.
"Real Estate Leases" is defined in Section 4.6.
"Real Property" is defined in Section 4.6.
"Restricted Business " is defined in Section 6.4(a).
"Required Consents" is defined in Section 4.3.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" means the security agreement substantially in the
form of Exhibit "D", attached hereto and made a part hereof.
"Software" means any computer software of any nature whatsoever,
including all systems software, all applications software, whether for general
business usage (e.g., accounting, finance, word processing, graphics,
spreadsheet analysis, etc.) or specific, unique-to-the-Business usage (e.g.,
telephone call processing, etc.) and all computer operating, security or
programming software, that is owned by or licensed to a Selling Entity and
relates primarily to the Business, or has been developed or designed for, or is
in the process of being developed or designed primarily for the Business, and
any and all documentation and object and source codes related thereto.
"Taxes" is defined in Section 4.12.
"Termination Fee" is defined in Section 11.2(b).
"Trademarks" means registered trademarks, registered trade name and
service marks, trademark, trade name and service xxxx applications, unregistered
trademarks, trade name and service marks and brand names, service marks and
logos.
"Transaction Documents" means this Agreement and the Collateral
Agreements.
"Transactions" means the purchase and sale of the Purchased Assets and
the consummation of the other transactions contemplated by the Transaction
Documents.
"Transferred Employees " is defined in Section 6.10.
2. Purchase and Sale of the Business and Assets.
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2.1 The Purchased Assets. Subject to the terms and conditions of this
Agreement, at the Closing, the Selling Entities shall grant, sell, assign,
transfer, convey and deliver to CTB, free and clear of all Encumbrances
whatsoever, other than the permitted Encumbrances set forth on Schedule 2.1 (the
"Permitted Encumbrances"), and CTB shall purchase from the Selling Entities, the
Business as a going concern, and all right, title and interest of the Selling
Entities in and to all of the Assets used in or with respect to the conduct of
the Business other than the Excluded Assets (collectively, the "Purchased
Assets") as the same shall exist on the Closing Date including the following:
(a) Real Property Leased. Each Selling Entity's interest, as a
lessee, in the real property leased by such Selling Entity as is
described on Schedule 2.1(a), and any easements, deposits or other
rights pertaining thereto;
(b) Equipment and Other Tangible Personal Property. All
equipment, leasehold improvements, automobiles, supplies, office
furniture and office equipment, computers and telecommunications
equipment and other items of personal property that are owned by a
Selling Entity relating to the Business, including those described on
Schedule 2.1(b);
(c) Contracts of the Business. All of the interest of each
Selling Entity in all Contracts, the License Agreement (save for any
financial benefits), leases of equipment and other personal property,
sale orders, purchase orders, commitments, instruments and all other
agreements relating, in all cases, to the Business, including those
listed on Schedule 2.1(c);
(d) Customer Records, Sales and Marketing Materials. All
customer records, including principal contacts, address and telephone
number, purchasing history, payment information and any other
information with respect to the customers of the Business, sales data,
catalogs, brochures, suppliers' names, mailing lists, art work,
photographs and advertising material relating to the Business, whether
in electronic form or otherwise;
(e) Permits. All rights under Permits relating to the
Business, including those listed on Schedule 2.1(e), to the extent such
Permits are transferable to CTB;
(f) Intellectual Property. All Intellectual Property,
including the Intellectual Property described in Schedule 2.1(f) and
exclusive rights to the name "Country Tonite Enterprises, Inc." to the
trademark "Country Tonite" and to the title song "Country Tonite" and
all goodwill associated therewith, along with all rights, title and
interest in all video and song recordings of the Show from inception to
the extent of the interest of the Selling Entities therein, except in
all cases as granted in the License Agreement;
(g) Property, Personnel and Accounting Records. All other
records of the Selling Entities relating to the Business, including
property records and records relating to employees (provided that the
Selling Entities shall be entitled to retain copies of the foregoing)
all location manuals, employee policy manuals, safety manuals, forms of
independent contractor; employee, marketing and ticket voucher
agreements and all other types of manuals or contracts related to the
presentation of the "Country Tonite Show", in electronic format if
possible;
(h) Inventory. All Inventory relating to the Business;
(i) Prepaid Expenses. All rights relating to any prepaid
expenses of or arising in connection with the Business, including those
described on Schedule 2.1(i);
(j) Software. All Software, including the Software described
in Schedule 2.1(j)(i), and all documentation related thereto; provided,
however, that all third party licensed Software included in the
Purchased Assets shall be transferred to CTB subject to the terms and
conditions of the third party licenses listed in Schedule 2.1(j)(ii)
under which the particular Selling Entity acquired such licensed
Software; and
(k) Other Intangible Assets. All other assets (including all
causes of action, rights of action, contract rights and warranty and
product liability claims against third parties) relating to the
Purchased Assets or the Business, including those described on Schedule
2.1(k).
2.2 Excluded Assets. The corporate seal, Charter Documents, bylaws,
minute book and other corporate records of each Selling Entity, those assets of
each Selling Entity described in Schedule 2.2, insurance Contracts, cash,
accounts receivable and all financial benefit derived under the License
Agreement for the Country Tonight production show based in Pigeon Forge,
Tennessee (collectively, the "Excluded Assets") shall not be included in the
Purchased Assets in any event.
2.3 Assumed Liabilities. At the Closing, and subject to Xxxxxxx 0.0,
XXX shall assume the following obligations (the "Assumed Liabilities"):
(a) all obligations that come into existence after the
Closing (and do not relate to the period prior to or at the Closing)
under all Contracts and Permits listed on Schedules 2.1(c) and (e) that
are conveyed to CTB as Purchased Assets pursuant to the terms and
conditions hereof; and
(b) all advance deposits and pre-paid ticket sales (and ticket
or amusement taxes pertaining thereto) of the Business as of the
Closing Date, but only to the extent of the amount of the advance
deposits and pre-paid ticket sales applied as a reduction in the
Purchase Price at Closing pursuant to Section 2.6(c).
(c) all obligations of CTE under the License Agreement (even
though the revenues derived from the License Agreement will be retained
by CTE as an Excluded Asset hereunder).
2.4 Excluded Liabilities. Except as expressly set forth in Xxxxxxx 0.0,
XXX shall not, by virtue of its purchase of the Purchased Assets or otherwise in
connection with the Transactions, assume or become responsible for any
Liabilities (the "Excluded Liabilities") of any Selling Entity of any nature
whatsoever arising on or before the Closing Date, including, but not limited to
(a) Liabilities relating to or arising out of any Selling Entity, the Purchased
Assets, the Business (including any event, condition, occurrence, action,
inaction or transaction relating to any of the foregoing) or the actions of any
Selling Entity's officers, employees, representatives or agents prior to or at
the Closing, (b) Liabilities for any Taxes (other than what is provided in
Section 2.3(b)), (c) Liabilities relating to any claims for health care or other
welfare benefits, (d) Liabilities relating to any violation of any Law, (e) tort
Liabilities, (f) Liabilities from claims arising under any Contract or Permit
not assumed by CTB pursuant hereto or included in any arrangement set forth in
Section 2.5; (g) Liabilities for claims arising under any Contract or Permit to
the extent such claim is based on events, conditions, acts or omissions of any
Person which occurred prior to or at the Closing; (h) contingent Liabilities
unknown to the Selling Entities at the Closing; and (i) Liabilities for any
accounts payable existing as of the Closing Date or indebtedness for money
borrowed.
2.5 Consent of Third Parties. Nothing in this Agreement shall be
construed as an attempt by any Selling Entity to assign to CTB any Contract or
Permit included in the Purchased Assets that is by its terms or by Law
nonassignable without the consent of any other party or parties, unless such
consent or approval shall have been given, or as to which all the remedies for
the enforcement thereof available to the Selling Entities would not by Law pass
to CTB as an incident of the assignments provided for by this Agreement (a
"Non-Assignable Contract"). To the extent that any such consent or approval in
respect of, or a novation of, a Non-Assignable Contract shall not have been
obtained on or before the Closing Date, the appropriate Selling Entity shall
continue to use reasonable efforts to obtain any such consent, approval or
novation after the Closing Date until such time as it shall have been obtained,
and shall cooperate with CTB in any economically feasible arrangement to provide
that CTB shall receive the benefits of the relevant Selling Entity under such
Non-Assignable Contract, provided that CTB shall undertake to pay or satisfy the
corresponding Liabilities under the terms of such Non-Assignable
Contract to the extent that it would have been responsible therefore if such
consent, approval or novation had been obtained.
2.6 Purchase Price. In addition to assuming the Assumed Liabilities,
the aggregate price to be paid by CTB to the Selling Entities (the "Purchase
Price") for the purchase of the Purchased Assets shall be equal to the following
(which calculation shall be made as of the Closing Date and set forth in a
certificate of CTB and BBT delivered at the Closing):
(a) $3,800,000, which shall be paid by CTB to the Selling Entities as
follows:
(i) $100,000, which has been paid out of the Escrow Account in
accordance with the instructions of the Escrow Agreement;
(ii) $250,000, which is to be deposited in the Escrow Account on
or before January 26, 2001 and which will be paid out of Escrow;
(iii) $650,000 Secured Short Term Note; and
(iv) $2,800,000 Secured Promissory Note.
(b) plus all prepaid expenses to the extent useable by CTB after the
Closing Date as set forth on Schedule 2.1(i);
(c) minus, the amount of all advance deposits and pre-paid ticket
and/or voucher sales (and ticket or amusement taxes pertaining
thereto) of the Business included in the Assumed Liabilities;
(d) minus the following, to the extent such amounts relate to the
Purchased Assets or the Business are unpaid as of the date of
Closing and have not been paid by the Selling Entities prior to
or at the Closing, all of which will become Assumed Liabilities
to the extent they are credited against the Purchase Price:
(i) the prorated amount for the period prior to the Closing Date
of all real estate taxes and assessments, both general and
special, water charges and sewer rents, whether or not then due
or payable, and all other normally proratable items
(collectively, the "Prorations"), based upon the latest
assessments or actual invoices available (should any such
proration be inaccurate based upon the actual tax xxxx or
assessment when received, any party hereto may demand and shall
be entitled to receive on demand, a payment from the other
correcting such inaccuracy);
(ii) any fees, taxes, impact fees, assessments, delinquent or
otherwise, attributable to a period prior to the Closing Date;
(iii) any other land use charges attributable to any period
prior to the Closing Date;
(iv) one-half of all necessary State of Missouri, county and
municipal transfer, document stamp and/or recording taxes, if
any, incident to the transaction contemplated in this Agreement
normally attributable to the grantor; and
(v) one-half of the cost of any escrow fee and charges of any
escrow agent, regardless of whether or not such escrow agent is
also counsel for any party hereto, the issuer of the Commitments
or the agent of such issuer.
2.7 Allocation of the Purchase Price. The Purchase Price allocation
shall be prepared by CTB. CTB and the Selling Entities (in consultation with
each party's financial advisors) shall agree in writing to the allocation prior
to the Closing. The Selling Entities and CTB shall prepare their respective
federal, state and local tax returns employing such agreed allocation and shall
not take a position in any tax proceeding or otherwise that is inconsistent with
such allocation. The Selling Entities and CTB shall give prompt notice to each
other of the commencement of any tax audit or the assertion of any proposed
deficiency or adjustment by any taxing authority or agency which challenges such
allocation.
3. Closing.
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3.1 Location; Date. The closing of the Transactions (the "Closing")
shall take place by mail delivery or electronic transmission on the later of
January 31, 2001 or the third business day after the date on which the
conditions set forth in Sections 8 and 9 to be satisfied prior to the Closing
have been satisfied (or waived by the party entitled to the benefit thereof), or
at such other date as CTB, BBT and the Selling Entities may agree.
3.2 Closing Deliveries. In connection with the completion of the
Transactions contemplated in Section 2, at the Closing;
(a) CTB shall deliver or cause to be delivered to the Selling
Entities:
(i) $250,000 in cash from the Escrow Agreement;
(ii) the $650,000 Secured Short Term Note;
(iii) the $2,800,000 Secured Promissory Note;
(iv) the Security Agreement (and any necessary financing
statements); and
(v) such assumption agreements and other agreements, documents and
instruments as may be contemplated by this Agreement and such
other items as may be reasonably requested by BBT or the Selling
Entities to consummate the transactions contemplated by this
Agreement, each in form and substance reasonably satisfactory to
BBT and the Selling Entities.
(b) BBT and the Selling Entities shall deliver or cause to be
delivered to CTB:
(i) such bills of sale and assignment, deeds and
assumption agreements as may be required to transfer each
Selling Entity's right, title and interest in and to the
Purchased Assets in form and substance reasonably satisfactory
to CTB; and
(ii) such other agreements, documents and instruments
as may be contemplated by this Agreement and such other items
as may be reasonably requested by CTB to consummate the
transactions contemplated by this Agreement, each in form and
substance reasonably satisfactory to CTB.
(c) CTB shall deliver to BBT and the Selling Entities, and BBT and
the Selling Entities shall deliver to CTB, the certificates,
instruments and agreements referred to in Section 9 and Section
8, respectively.
4. Representations and Warranties of BBT and the Selling Entities. BBT and the
Selling Entities, jointly and severally, hereby represent and warrant to CTB as
follows:
4.1 Corporate Status. BBT and each Selling Entity is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated and each is qualified to do business as
a foreign corporation and is in good standing in each jurisdiction where it is
required to be so qualified, except where the failure to be so qualified would
not have a Material Adverse Effect.
4.2 Authorization. BBT and each Selling Entity has the requisite power
and authority to own its property and carry on the Business as currently
conducted, and to execute and deliver the Transaction Documents to which it is a
party and to perform the Transactions to be performed by it. Such execution,
delivery and performance by BBT and each Selling Entity has been duly authorized
by all necessary corporate action. Each Transaction Document executed and
delivered by BBT and the Selling Entities as of the date hereof has been duly
executed and delivered by each and constitutes a valid and binding obligation of
each Selling Entity, enforceable against each in accordance with its terms. Each
Transaction Document to be executed and delivered by BBT or a Selling Entity
after the date hereof will have been duly
executed and delivered by the relevant party and will constitute a valid and
binding obligation of such party, enforceable against it in accordance with its
terms.
4.3 Consents and Approvals. Except for the consents specified in
Schedule 4.3 (the "Required Consents"), neither the execution nor delivery by
BBT or each Selling Entity of any Transaction Document to which it is a party,
nor the performance of the Transactions to be performed by it thereunder, will
require any filing, consent or approval, constitute a Default or cause any
payment obligation to arise under (a) any Law or Court Order to which BBT or any
Selling Entity is subject, (b) the Charter Documents or bylaws of BBT or any
Selling Entity or (c) any Contract, Permit or other document to which BBT or
each Selling Entity is a party or by which the Business or Purchased Assets may
be subject.
4.4 Financial Statements. Schedule 4.4 includes correct and complete
copies of financial statements of the Business, consisting of the balance sheets
of the Business as of September 30, 1998, 1999 and 2000 and the related
statements of income of the Business for the years then ended, all of which have
been subjected to the same audit procedures as applied to the BBT audited
financial consolidated financial statements audited by BDO Xxxxxxx (for 1998 and
1999) and Xxxx Xxxxx, CPA (for 2000), and are accompanied by the January 3, 2001
Xxxx Xxxxx Independent Auditor's Report and January 4, 2001 memorandum from
Xxxxxx Xxxxxxx (collectively, the "Audited Financial Statements") and unaudited
financial statements of the Business consisting of the balance sheet of the
Business as of December 31, 2000 and the related statement of income of the
Business for the three-month period then ended prepared by BBT (collectively,
the "Interim Financial Statements" and together with the Audited Financial
Statements, the "Financial Statements"). The Financial Statements are in all
material respects consistent with the books and records of the Business and the
books and records underlying such Financial Statements include all material
transactions required by GAAP, applied on a consistent basis. The Financial
Statements have been prepared in accordance with GAAP consistently applied and
present fairly the financial position and assets and liabilities of the Business
as of the dates thereof and the results of its operations for the periods then
ended, subject to, in the case of the Interim Financial Statements, normal
year-end adjustments which are not material in amount or significance in any
individual case or in the aggregate, and the absence of footnotes, statements of
cash flows and other presentation items that may be required under GAAP. The
balance sheet as of September 30, 2000 that is included in the Financial
Statements is referred to herein as the "Balance Sheet" and the date thereof is
referred to as the "Balance Sheet Date." The balance sheet as of December 31,
2000 that is included in the Financial Statements is referred to herein as the
"Interim Balance Sheet" and the date thereof is referred to as the "Interim
Balance Sheet Date."
4.5 Title to Assets and Related Matters. The Selling Entities
collectively own and will transfer to CTB at the Closing good, marketable and
indefeasible title to, or with respect to leased assets included in the
Purchased Assets, a valid leasehold interest in, subject to the terms and
conditions of such leases, all of the Purchased Assets, free and clear of all
Encumbrances other than Permitted Encumbrances. The use of the Purchased Assets
is not subject to any Encumbrances (other than Permitted Encumbrances), and such
use does not materially encroach
on the property or rights of any other Person. All Purchased Assets are in the
possession or under the control of one or more of the Selling Entities and
consist of all of the Assets necessary to operate the Business as currently, and
since September 30, 2000, operated and which generated the revenues reflected in
the Financial Statements except for Assets disposed of since such date in the
ordinary course of business. Except as set forth on Schedule 4.5, all of the
tangible personal property included in the Purchased Assets (a) is in good
working condition and repair, subject to normal wear and tear, (b) is usable in
the ordinary course of business and (c) conforms in all material respects with
all applicable Laws relating to its construction, use and operation. Except for
those items subject to the Personal Property Leases, no Person other than the
Selling Entities owns any vehicles, equipment or other tangible assets located
on the Real Property that are used by the Selling Entities in the Business
(other than immaterial items of personal property owned by the employees of the
Selling Entities) or that are necessary for the operation of the Business as
currently, and since September 30, 2000, operated except for Assets disposed of
since such date in the ordinary course of business. BBT does not own or lease
any Assets used in the operation of the Business or necessary to operate the
Business substantially in accordance with past practice.
4.6 Real Property. Schedule 4.6 sets forth the complete legal
description of all real estate (including a description of how such real estate
is zoned) used in the operation of the Business as well as any other real estate
that is in the possession of or leased by each Selling Entity and the
improvements (including buildings and other structures) located on such real
estate (collectively, the "Real Property"), identifies which Real Property is
owned and which is leased, and lists any leases under which any such Real
Property is possessed by each Selling Entity or leased by each Selling Entity to
others (the "Real Estate Leases"). All of the buildings and structures included
in the Real Property are structurally sound, and all of the heating,
ventilating, air conditioning, plumbing, sprinkler, fire alarm, electrical and
drainage systems, elevators and roofs, and all other fixtures, equipment and
systems at or serving such Real Property are in good condition, repair and
working order (subject to normal wear and tear) and constitute all of the
systems, elevators, roofs, fixtures and equipment utilized by the Selling
Entities in the operation of the Business as currently, and since September 30,
2000, operated, and there is no condition that will result in the termination of
the present access from the Real Property to such utility services and other
facilities. Neither BBT nor any Selling Entity has received any written (or to
the Knowledge of BBT or any Selling Entity oral) notices, and neither BBT nor
any Selling Entity has reason to believe, that any governmental body having
jurisdiction over any Real Property intends to exercise the power of
expropriation or eminent domain or a similar power with respect to all or any
part of the Real Property. Neither BBT nor any Selling Entity has received any
written (or to the Knowledge of BBT or any Selling Entity oral) notices, from
any governmental body, and neither BBT nor any Selling Entity has reason to
believe, that any of the Real Property or any improvements erected or situated
thereon, or the uses conducted thereon or therein, violate any Laws of any
governmental body having jurisdiction over such Real Property. Neither BBT nor
any Selling Entity has received any written (or to the Knowledge of BBT or any
Selling Entity oral) notice from the holder of any mortgage, from any insurance
company which has issued a policy with respect to any of the Real Property or
from any board of fire underwriters (or other body exercising similar functions)
claiming any defects or deficiencies
in any of the Real Property or suggesting or requesting the performance of any
repairs, alterations or other work to any of the Real Property.
4.7 Certain Personal Property. The Selling Entities have delivered to
CTB a complete fixed asset schedule, describing and specifying the location of
all items of tangible personal property that are included in the Balance Sheet.
Except as listed on Schedule 4.7, since the Balance Sheet Date, no Selling
Entity has (a) acquired any items of tangible personal property that has, in any
case, a carrying value in excess of $10,000, or an aggregate carrying value in
excess of $25,000 or (b) disposed of (other than in the ordinary course of
business) any items of tangible personal property (other than Inventory) that
have, in any case, an initial carrying value in excess of $10,000, or an initial
aggregate carrying value in excess of $25,000.
4.8 Personal Property Leases. Schedule 4.8 lists all assets and
property (other than Real Property) that have been used in the operation of the
Business and that are possessed by a Selling Entity under an existing lease,
including all trucks, automobiles, machinery, equipment, office equipment,
furniture and computers, except for any lease under which the aggregate annual
payments are less than $1,000 (each, an "Immaterial Lease"). Schedule 4.8 also
lists the leases under which such assets and property listed on Schedule 4.8 are
possessed. All of such leases (excluding "Immaterial Leases") are referred to
herein as the "Personal Property Leases."
4.9 Inventory. All Inventory of each Selling Entity consists of items
useable or saleable in the ordinary course and is valued on each Selling
Entity's books and records at the lower of cost or fair market value. The
inventory records for the Selling Entities that have been delivered to CTB or
made available for inspection by CTB are materially accurate with respect to the
data contained therein.
4.10 Price Guarantees. Schedule 4.10 sets forth any outstanding
warranties or price guarantees made by each Selling Entity.
4.11 Liabilities. Except as specified on Schedule 4.11, no Selling
Entity has any Liabilities with respect to the Business, and none of the
Purchased Assets are subject to any Liabilities, except (a) as specifically
disclosed on the Interim Balance Sheet, (b) Liabilities incurred in the ordinary
course since the Interim Balance Sheet Date, and (c) Liabilities under the Lease
Agreement, any Contracts specifically disclosed (or not required to be disclosed
because of the term or amount involved) that were not required under GAAP to
have been specifically disclosed or reserved for in the Financial Statements.
4.12 Taxes. With respect to each Selling Entity and each member of any
affiliated group of a Selling Entity, within the meaning of Section 1504 of the
Code, of which a Selling Entity is or has been a member (the Selling Entities
and each such other company referred to in this Section 4.12 as the "Company")
(a) except as described in Schedule 4.12, all reports, returns, statements
(including estimated reports, returns, or statements), and other similar filings
required to be filed on or before the Closing Date by the Company (the "Tax
Returns") with respect to any Taxes (as defined below) have been timely filed
with the appropriate governmental
agencies in all jurisdictions in which such Tax Returns are required to be
filed, and all such Tax Returns correctly reflect the liability of the Company
for Taxes for the periods, properties, or events covered thereby; (b) except as
described in Schedule 4.12, all Taxes payable with respect to the Tax Returns
referred to in the preceding clause, and all Taxes accruable or otherwise
attributable to events occurring prior to the Closing Date, whether disputed or
not, whether or not shown on any Tax Return, and whether or not currently due or
payable, will have been paid in full prior to the Closing Date, or an adequate
accrual in accordance with GAAP has been provided with respect thereto on the
Interim Balance Sheet; (c) except as described in Schedule 4.12, the Company has
no knowledge of any unassessed Tax deficiencies or of any audits or
investigations pending or threatened against the Company with respect to any
Taxes; (d) except as described in Schedule 4.12, no Tax Returns of the Company
have been examined by the Internal Revenue Service, and any assessments with
respect to such returns have been fully paid; (e) except as described in
Schedule 4.12, there is in effect no extension for the filing of any Tax Return
and the Company has not extended or waived the application of any statute of
limitations of any jurisdiction regarding the assessment or collection of any
Tax; (f) since January 1, 1996, no claim has been made by any Tax authority in a
jurisdiction in which the Company does not file Tax Returns that it is or may be
subject to taxation by that jurisdiction; (g) there are no liens for Taxes upon
any asset of the Company except for liens for current Taxes not yet due; (h) the
Company has timely made all deposits required by law to be made with respect to
employees' withholding and other payroll, employment, or other withholding
taxes, including the portions of such taxes imposed upon the Company.
For purposes of this Agreement, "Taxes" means any taxes,
duties, assessments, fees, levies, or similar governmental charges, together
with any interest, penalties, and additions to tax, imposed by any taxing
authority, wherever located (i.e., whether federal, state, local, municipal, or
foreign), including all net income, gross income, gross receipts, net receipts,
sales, use, transfer, franchise, privilege, profits, social security,
disability, withholding, payroll, unemployment, employment, excise, severance,
property, windfall profits, value added, ad valorem, occupation, or any other
similar governmental charge or imposition.
4.13 Subsidiaries. Except as disclosed on Schedule 4.13, no Selling
Entity owns in relation to the Business, directly or indirectly, any interest or
investment (whether equity or debt) in any corporation, partnership, business,
trust, joint venture or other legal entity.
4.14 Legal Proceedings and Compliance with Law.
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(a) Except as disclosed on Schedule 4.14(a), there is no
Litigation that is pending or, to the Knowledge of BBT or a Selling
Entity, threatened against or related to BBT or a Selling Entity with
respect to the Business or the Purchased Assets. There has been no
Default under any Law applicable to the Purchased Assets or the
Business, including any Law relating to protection or quality of the
environment, except for any Defaults that have been cured, and neither
BBT nor any Selling Entity has received any notices from any
governmental entity regarding any alleged Default or investigation
under any written order, instruction or direction pursuant to any Law
except those that have
been cured. Since January 1, 1996, there has been no Default with
respect to any Court Order applicable to BBT or a Selling Entity.
(b) Without limiting the generality of Section 4.14(a), except
as described on Schedule 4.14(b), to the Knowledge of BBT or the
Selling Entities there has not been any Environmental Condition (i) at
any premises at which the Business is currently conducted, (ii) at any
property owned, leased or operated at any time by BBT or a Selling
Entity (or any predecessor of BBT or a Selling Entity) or any Person
controlling or controlled by any Affiliate of BBT or a Selling Entity,
or (iii) at any property at which wastes have been deposited or
disposed by or at the behest or direction of BBT or a Selling Entity
(or any predecessor of BBT or a Selling Entity) or any Person
controlled by any Affiliate of BBT or a Selling Entity, nor has BBT or
any Selling Entity received written notice of any such Environmental
Condition or any investigation, to determine whether any such
Environmental Condition exists. "Environmental Condition" means any
condition or circumstance, including the presence of Hazardous
Substances, whether created by BBT or a Selling Entity (or any
predecessor of BBT or a Selling Entity) or any third party, at or
relating to any such property or premises that would (x) require
abatement or correction under an Environmental Law, (y) give rise to
any civil or criminal liability under an Environmental Law or (z)
create a public or private nuisance. "Environmental Law" means all Laws
and Court Orders relating to protection or quality of the environment
as well as any principles of common law under which a Person may be
held liable for the release or discharge of any materials into the
environment.
(c) Neither BBT nor any Selling Entity has Knowledge of any
other written reports, studies or assessments, whether in the
possession or control of BBT or a Selling Entity, that relate to any
Environmental Condition.
(d) Except in those cases where the failure would not have a
Material Adverse Effect, (i) each Selling Entity has obtained and is in
substantial compliance with all Permits, all of which are listed on
Schedule 4.14(d) along with their respective expiration dates, that are
required for the ownership of the Purchased Assets or operation of the
Business as reflected in the Financial Statements, (ii) all of the
Permits are currently valid and in full force and (iii) each Selling
Entity has filed such timely and complete renewal applications as may
be required with respect to its respective Permits. Neither BBT nor a
Selling Entity has Knowledge of any threatened revocation, cancellation
or withdrawal of a Permit.
4.15 Contracts. Schedule 4.15 lists each Contract of the following
types to which each BBT and each Selling Entity is a party or by which it is
bound relating to the Business or the Purchased Assets:
(a) Contracts with any present or former five percent (5%)
stockholder, director, officer, employee or consultant or with any
Affiliate of a Selling Entity;
(b) Contracts for the purchase of, or payment for, supplies or
products, or for the performance of services, from or by a third party,
in excess of $10,000 with respect to any one supplier or other party;
(c) Contracts to sell or supply products, Inventory or other
property to, or to perform services for, a third party, that involve an
amount in excess of $10,000 with respect to any one customer or other
party;
(d) Contracts to sell any product or provide any service to a
governmental or regulatory body;
(e) Contracts limiting or restraining any Selling Entity from
engaging or competing in any lines or business with any Person;
(f) Contracts with any customer providing for a volume refund,
retrospective price adjustment or price guarantee;
(g) Contracts to lease to, or to operate for, any other party
any asset that involves an amount in excess of $5,000 in any individual
case (other than Real Estate Leases and Personal Property Leases
identified on a Schedule);
(h) Any notes, debenture, bonds, conditional sale agreements,
equipment trust sale and lease-back and leasing agreements, letter of
credit agreements, reimbursement agreements, loan agreements or other
Contracts for the borrowing or lending of money (including loans to or
from officers, directors, shareholders or Affiliates of any Selling
Entity), or agreements or arrangements for a line of credit or for a
guarantee of, or other undertaking in connection with, the indebtedness
of any other Person;
(i) Contracts creating or recognizing any Encumbrances with
respect to any Purchased Assets;
(j) Contracts with distributors, manufacturers' sales
representatives or other sales agents;
(k) Contracts that relate in whole or in part to any Software,
technical assistance or other know-how or other Intellectual Property
right;
(l) Contracts for any capital expenditure or leasehold
improvement in excess of $5,000; and
(m) Any other Contracts (other than those that may be
terminated on not more than 30 days' notice without Liability and those
described in any of (a) through (l) above) not made in the ordinary
course of business or which are material to the Business or the
Purchased Assets.
4.16 No Selling Entity is in Default under any Contract. To the
Knowledge of BBT and the Selling Entities, neither BBT nor any Selling Entity is
in Default under any Contract relating to the Business or has received any
communication from, or given any communication to, any other party indicating
that BBT or a Selling Entity or such other party, as the case may be, is in
Default under any such Contract. To the Knowledge of BBT and the Selling
Entities, none of the other parties to any such Contract to which BBT or a
Selling Entity is a party is in Default thereunder.
4.17 Insurance. Schedule 4.17 lists all policies or binders of
insurance held by or on behalf of each Selling Entity or relating to the
Business or any of the Purchased Assets, specifying with respect to each policy
the insurer, the type of insurance, the amount of the coverage, the insured, the
expiration date, the policy number and any pending claims thereunder.
4.18 Intellectual Property.
(a) Schedule 4.18 sets forth a correct and complete list and
description of all Intellectual Property and all Software owned by or
licensed to any Selling Entity and used, in whole or in part, directly
or indirectly in, and material to the Business, and indicates whether
such Intellectual Property and Software is owned or licensed by such
Selling Entity.
(b) Except as disclosed on Schedule 4.18: (i) the Selling
Entities own or possess adequate licenses or other valid rights to use
(without the making of any payment to others or the obligation to grant
rights to others in exchange) all of such Intellectual Property and
Software; (ii) the Intellectual Property and Software included in the
Purchased Assets constitute all such rights and property necessary to
conduct the Business in accordance with past practice and the rights to
which are being transferred to CTB together with the other Purchased
Assets; (iii) no Selling Entity is in Default under any Contract with
respect to any of such Intellectual Property or Software; (iv) the
validity of such Intellectual Property and the rights of any Selling
Entity therein and to the Software has not been questioned in any
Litigation to which a Selling Entity is or was a party or in any other
written notice to a Selling Entity, nor, to the Knowledge of each
Selling Entity, is any such Litigation threatened; and (v) to the
Knowledge of BBT and each Selling Entity, the conduct of the Business
does not materially conflict with patent rights, licenses, trademark
rights, trade name rights, copyrights or other intellectual property
rights of others.
(c) Except as disclosed on Schedule 4.18, to the Knowledge of
BBT and each Selling Entity, no material use of any Intellectual
Property or Software included within the Purchased Assets has
heretofore been, or is now being, made by any Person other than a
Selling Entity or others under the License Agreement, except for
Software licensed to a Selling Entity under a third party license
agreement listed on Schedule 4.18. Except as disclosed on Schedule
4.18, to the Knowledge of BBT and each Selling Entity, there is
no current, and there has not since January 1, 1996, been any
infringement of any such Intellectual Property or Software owned or
licensed by a Selling Entity or used in the Business. Except for
interests being transferred pursuant to this Agreement and pursuant to
the License Agreement, no present or former director, officer, employee
or consultant of a Selling Entity or any Affiliate of a Selling Entity
has any interest, direct or indirect, in any of the Intellectual
Property or Software.
(d) To the Knowledge of BBT and each Selling Entity, (i) no
Confidential Information of a Selling Entity has been used, divulged or
appropriated for the benefit of any Person other than the Selling
Entities or otherwise to the detriment of any Selling Entity and (ii)
no employee or consultant of a Selling Entity is, or is currently
expected to be, in Default under any term of any employment Contract,
agreement or arrangement relating to the Intellectual Property, or any
confidentiality agreement or any other Contract or any restrictive
covenant relating to the Intellectual Property, or to the development
or exploitation thereof.
4.19 Employee Relations.
(a) Except as described on Schedule 4.19, no Selling Entity is
in relation to the Business (i) a party to or otherwise bound by any
collective bargaining or other type of union agreement, (ii) a party
to, involved in or, to the Knowledge of BBT or any Selling Entity,
threatened by, any labor dispute or unfair labor practice charge, or
(iii) currently negotiating any collective bargaining agreement, and no
Selling Entity has experienced any work stoppage during the last three
years in the operation of the Business as a result of a labor dispute.
Schedule 4.19 sets forth the names and current annual salary rates or
current hourly wages of all present employees of the Business.
(b) Each Selling Entity in the operation of the Business is
in material compliance with all applicable laws respecting employment
and employment practices, terms and conditions of employment and wages
and hours, and is not engaged in any unfair labor practice. There are
no outstanding written claims against any Selling Entity (whether under
Law, contract, policy, or otherwise) asserted by or on behalf of any
present or former employee or job applicant of the Business on account
of or for (i) overtime pay, other than overtime pay for work done in
the current payroll period, (ii) wages or salary for any period other
than the current payroll period, (iii) any amount of vacation pay or
pay in lieu of vacation time off, other than vacation time off or pay
in lieu thereof earned in or in respect of the current fiscal year,
(iv) any amount of severance pay or similar benefits, (v) unemployment
insurance benefits, (vi) workers' compensation or disability benefits,
(vii) any violation of any statute, ordinance, order, rule or
regulation relating to plant closings, employment terminations or
layoffs, including employee retraining, (viii) any violation of any
statute, ordinance, order, rule or regulations relating to employee
"whistleblower" or "right-to-know" rights and protection, (ix) any
violation of any statute, ordinance, order, rule or regulations
relating to the employment obligations of federal contractors or
subcontractors or (x) any violation of any Law relating to
minimum wages or maximum hours of work, and to the Knowledge of BBT and
each Selling Entity no such claims have been asserted. Since January 1,
1996, no Person (including any governmental body) has asserted or
threatened any claims against any Selling Entity relating to the
Business under or arising out of any Law relating to discrimination or
occupational safety in employment or employment practices.
4.20 ERISA.
(a) Schedule 4.20(a) contains a complete list of all Benefit
Plans sponsored or maintained by the Selling Entities, or under which
the Selling Entities may be obligated. The Selling Entities do not have
any current or contingent liability with respect to any Benefit Plan
other than those listed on Schedule 4.20(a). For purposes of this
Section 4.20 and Section 6.10, the term "Selling Entity" shall include
any partnership or corporation that is a member of any controlled group
of partnerships or corporations (as defined in Section 414(b) of the
Code) that includes the Selling Entities, any trade or business
(whether or not incorporated) that is under common control (as defined
in Section 414(c) of the Code) with any Selling Entity, any
organization (whether or not incorporated) that is a member of an
affiliated service group (as defined in Section 414(m) of the Code)
that includes each Selling Entity and any other entity required to be
aggregated with any Selling Entity pursuant to the regulations issued
under Section 414(o) of the Code. Each Benefit Plan providing benefits
that are funded through a policy of insurance is indicated by the word
"insured" placed by the listing of the Benefit Plan on Schedule
4.20(a).
(b) The Selling Entities have delivered to CTB, to the extent
applicable, (i) accurate and complete copies of all Benefit Plan
documents and all other documents relating thereto, including all
summary plan descriptions, summary annual reports and insurance
contracts, (ii) accurate and complete detailed summaries of all
unwritten Benefit Plans, (iii) accurate and complete copies of the most
recent financial statements and actuarial reports with respect to all
Benefit Plans for which financial statements or actuarial reports are
required or have been prepared and (iv) accurate and complete copies of
all annual reports for all Benefit Plans (for which annual reports are
required) prepared within the last three years.
(c) All Benefit Plans conform (and for the past six years
have conformed) to, and are being administered and operated (and for
the past six years have been administered and operated) in material
compliance with, the requirements of ERISA, the Code and all applicable
Laws. All returns, reports and disclosure statements required to be
made under ERISA and the Code with respect to all Benefit Plans have
been timely filed or delivered or an extension for the delayed filing
has been obtained from the Internal Revenue Service or the U.S.
Department of Labor. To the Knowledge of BBT or the Selling Entities,
there has not been any "prohibited transaction," as such term is
defined in Section 4975 of the Code or Section 406 of ERISA involving
any of the
Benefit Plans, that could subject the Selling Entities to any penalty
or tax imposed under the Code or ERISA.
(d) Any Benefit Plan that is intended to be qualified under
Section 401(a) of the Code and exempt from tax under Section 501(a) of
the Code has been determined by the Internal Revenue Service to be so
qualified or an application for determination has been timely filed
(and is still pending) with the Internal Revenue Service, and such
determination remains in effect and has not been revoked. Copies of the
most recent Internal Revenue Service determination letters, if any,
applicable to the Benefit Plans have been delivered to CTB. Nothing has
occurred since the date of any such determination (if received) that
would adversely affect such qualification or exemption.
(e) No Selling Entity sponsors or contributes to, and has not
at any time sponsored or contributed to, a defined benefit plan subject
to Title IV of ERISA, and no Selling Entity has incurred any liability
under Title IV of ERISA. No Selling Entity has a current or contingent
obligation to contribute to any multiemployer plan (as defined in
Section 3(37) of ERISA), nor has any Selling Entity ever had any
obligation to contribute to a multiemployer plan.
(f) There are no pending or, to the Knowledge of BBT and each
Selling Entity, threatened claims by or on behalf of any Benefit Plans,
or by or on behalf of any participants or beneficiaries of any Benefit
Plans or other persons, alleging any breach of fiduciary duty on the
part of any Selling Entity or any of its officers, directors or
employees under ERISA or any applicable Law, or claiming benefit
payments other than those made in the ordinary operation of such plans,
nor is there, to the Knowledge of BBT and each Selling Entity, any
basis for any such claim. To the Knowledge of BBT and each Selling
Entity, the Benefit Plans are not the subject of any investigation,
audit or action by the Internal Revenue Service, the U.S. Department of
Labor or the Pension Benefit Guaranty Corporation ("PBGC"). Except as
disclosed on Schedule 4.20(f), no Selling Entity has made a plan or
commitment, whether or not legally binding, to create any additional
Benefit Plan or to modify or change any existing Benefit Plan.
(g) Each Selling Entity has made all required contributions
under its Benefit Plan on a timely basis, or such contributions are
properly accrued on the Financial Statements.
(h) There have been no accumulated funding deficiencies (as
defined in Section 412 of the Code or Section 302 of ERISA) with
respect to any Benefit Plan and no request for a waiver from the
Internal Revenue Service with respect to any minimum funding
requirement under Section 412 of the Code. No Selling Entity has
incurred any liability for any excise, income or other taxes or
penalties with respect to any Benefit Plan, and no event has occurred
and no circumstance exists or has existed that could give rise to any
such liability.
(i) The execution of and performance of the transactions
contemplated by this Agreement will not (either alone or upon the
occurrence of any additional or subsequent events) result in any
payment, severance compensation, acceleration, vesting or increase in
benefits with respect to any employee or former employee of a Selling
Entity, and no compensation or benefits to be provided to such
employees or former employees under any Benefit Plan or other agreement
in effect as of the Closing will be considered an "excess parachute
payment" under Section 280G of the Code.
(j) With respect to any Benefit Plan that is an employee
welfare benefit plan (within the meaning of Section 3(1) of ERISA) (a
"Welfare Plan"), (i) each Welfare Plan for which contributions are
claimed as deductions under any provision of the Code is in compliance
with all applicable requirements pertaining to such deduction, (ii)
with respect to any welfare benefit fund (within the meaning of Section
419 of the Code) related to a Welfare Plan, there is no disqualified
benefit (within the meaning of Section 4976(b) of the Code) that would
result in the imposition of a tax under Section 4976(a) of the Code,
(iii) any Benefit Plan that is a group health plan (within the meaning
of Section 4980B(g)(2) of the Code) complies, and in each and every
case has complied, with all of the requirements of Section 4980B of the
Code, ERISA, Title XXII of the Public Health Service Act, the
applicable provisions of the Social Security Act and other applicable
laws, (iv) all Welfare Plans may be amended or terminated by a Selling
Entity at any time on or after the Closing, and (v) no Welfare Plan
provides health or other benefits after an employee's or former
employee's retirement or other termination of employment except as
required by Section 4980B of the Code.
(k) All persons classified by a Selling Entity as independent
contractors satisfy and have satisfied the requirements of applicable
law to be so classified, each Selling Entity has fully and accurately
reported their compensation on IRS Forms 1099 when required to do so,
and no Selling Entity has any obligations to provide benefits with
respect to such persons under Benefit Plans or otherwise.
4.21 Absence of Certain Changes. Except as contemplated by this
Agreement, since the Interim Balance Sheet Date, except as mutually agreed, the
Business has been conducted in the ordinary course and there has not been with
respect to any Selling Entity:
(a) any material adverse change in the Business or its assets
or liabilities;
(b) any increase in the compensation payable or to become
payable to any employee or agent of the Business, except for increases
for non-officer employees made in the ordinary course of business, nor
any other change in any employment or consulting arrangement of the
Business;
(c) any sale, assignment or transfer of any material assets of
the Business, or any additions to or transactions involving any
material assets of the Business, other than those made in the ordinary
course of business;
(d) any change in the accounting policies followed with
respect to the Business or the method of applying such principles;
(e) any capital expenditure commitment of the Business
involving in any individual case, or series of related cases, more than
(i) $10,000 or (ii) an amount that would cause the sum of all such
capital expenditure commitments to exceed $25,000; or
(f) any other transaction involving a development affecting
the Business or the Purchased Assets outside the ordinary course of
business consistent with past practice.
4.22 Customers. Each Selling Entity has used its reasonable business
efforts to maintain and does currently maintain, good working relationships with
all of its tour operators and ticketing receptives (collectively, "Customers").
Schedule 4.22 contains a list of the names of each of the five Customers that,
for the year ended September 30, 2000 were the largest dollar volume Customers
of each Selling Entity. Except as specified on Schedule 4.22, none of such
Customers has given any Selling Entity written (or to the Knowledge of BBT or
any Selling Entity oral) notice terminating, canceling or threatening to
terminate or cancel any Contract or relationship with a Selling Entity.
4.23 Finder's Fees. No Person has been retained by BBT or the Selling
Entities that is or will be entitled to any commission or finder's or similar
fee in connection with the Transactions.
4.24 Additional Information. Schedule 4.24 accurately sets forth all
names under which each Selling Entity has conducted any business or which it has
otherwise used at any time during the past five years.
4.25 Transactions with Affiliates. Except as set forth on Schedule
4.25, no Affiliate of any Selling Entity owns or has a controlling ownership
interest in any corporation or other entity (other than another Selling Entity)
that is a party to any Contract with respect to the Purchased Assets or the
Business.
4.26 Full Disclosure. There are and will be no materially misleading
statements in any of the representations and warranties made by BBT and each
Selling Entity in this Agreement (including the Schedules and Exhibits attached
hereto) or any other Transaction Document or in any of the documents,
certificates and instruments delivered or to be delivered by BBT and each
Selling Entity pursuant to this Agreement and neither BBT nor a Selling Entity
has omitted to state any fact necessary to make statements made herein or
therein not materially misleading. There is no fact known to BBT or any Selling
Entity that has specific application to the Business (other than general
economic or industry conditions) and that materially adversely affects or, as
far as BBT or the Selling Entities reasonably foresee, materially threatens, the
assets, business, prospects, financial condition, or results of operations of
the Business that has not been set forth in this Agreement or the Schedules
hereto.
5. Representations and Warranties of CTB and On Stage. CTB and On Stage hereby
represent and warrant to BBT and the Selling Entities as follows:
5.1 Corporate Status. CTB is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Nevada. On Stage is a corporation, validly existing and in good standing under
the laws of the state of Nevada. Both CTB and On Stage have the requisite power
and authority to execute and deliver the Transaction Documents to which each is
a party and to perform the Transactions to be performed by each of them
thereunder, and such execution, delivery and performance by each of them have
been duly authorized by all necessary corporate action.
5.2 Authorization. CTB and On Stage have the requisite power and
authority to execute and deliver the Transaction Documents to which each is a
party and to perform the Transactions to be performed by each of them. Such
execution, delivery and performance by CTB and On Stage have been duly
authorized by all necessary action. Each Transaction Document executed and
delivered by CTB and/or On Stage, as the case may be, as of the date hereof has
been duly executed and delivered by CTB and/or On Stage and constitutes a valid
and binding obligation of CTB and/or On Stage, enforceable against CTB and/or On
Stage in accordance with its terms. Each Transaction Document to be executed and
delivered by CTB and/or On Stage after the date hereof will have been duly
executed and delivered by CTB and/or On Stage and will constitute a valid and
binding obligation of CTB and/or On Stage, enforceable against it each of them
in accordance with its terms.
5.3 Consents and Approvals. Neither the execution and delivery by CTB
or On Stage of the Transaction Documents to which each is a party, nor the
performance of the Transactions to be performed by each of them thereunder, will
require any filing, consent or approval or constitute a Default under (a) any
Law or Court Order to which it is subject, (b) its Charter Documents or bylaws
or (c) any Contract, Permit or other document to which each is a party or by
which each of its properties or other assets may be subject.
5.4 Finder's Fees. No Person retained by CTB and/or On Stage is or will
be entitled to any commission or finder's or similar fee in connection with the
Transactions.
6. Certain Agreements.
6.1 Access. Between the date of this Agreement and the Closing Date,
BBT and the Selling Entities shall (a) give CTB and any Person who is
considering providing financing to CTB to finance any portion of the Purchase
Price, and their respective authorized representatives and legal counsel,
reasonable access to all properties, books, Contracts, Assets and records of the
Selling Entities relating to the Business or the Purchased Assets, (b) permit
CTB to make inspections thereof, and (c) cause its officers and its advisors to
furnish CTB with such financial and operating data and other information with
respect to the Business of the Selling Entities and to discuss with CTB and its
authorized representatives and legal counsel the affairs of the Selling
Entities relating to the Business or the Purchased Assets, all as CTB may from
time to time reasonably request.
6.2 Update Schedules. Between the date hereof and the Closing Date,
the Selling Entities shall promptly disclose to CTB, in writing, any information
set forth in the Schedules that is no longer complete, true or applicable and
any information of the nature of that set forth in the Schedules that arises
after the date hereof and that would have been required to be included in the
Schedules if such information had been obtained on the date of delivery thereof.
6.3 Financial Information. Until the Closing, upon request the Selling
Entities shall provide CTB within twenty (20) days after the end of the month
with monthly unaudited balance sheet(s) of the Business and the related
statements of income and cash flows of the Business, prepared in accordance with
GAAP and on the same basis as the Interim Financial Statements referred to in
Section 4.4, and certified as such by the chief financial officer of the Selling
Entities.
6.4 Restrictive Covenants.
(a) BBT and the Selling Entities hereby covenant that for the
period ending four years after the Closing Date, it will not, directly or
indirectly, own, manage, operate, join, control, finance or participate in the
ownership, management, operation, control or financing of, or be connected as a
partner, principal, agent, representative, consultant or otherwise with or use
or permit the name, Country Tonite, to be used in connection with, any business
or enterprise engaged directly or indirectly in competition with the business
conducted by CTB and its Affiliates, including any business involving a live
stage production or the Business, but excluding the Country Tonite production in
Pigeon Forge, Tennessee (together, the "Restricted Business"); within any
portion of the United States, Canada or Western Europe . The foregoing
restriction shall not be construed to prohibit the ownership by any Selling
Entity of a passive investment of not more than five percent (5%) of any class
of securities of any corporation which is engaged in any of the foregoing
businesses and which is listed on a recognized securities exchange.
(b) Neither BBT nor a Selling Entity shall, during the period
ending two years after the Closing Date, either directly or indirectly, (i) with
respect to the activities prohibited by Section 6.4(a), call on or solicit any
Person who or which within the past two years has been a Customer with respect
to the Restricted Business or (ii) solicit the employment of any Person who is
employed by CTB or any Affiliate of CTB during such period on a full or
part-time basis (except after any such Person's employment has been terminated
by CTB or any such Affiliate).
(c) BBT and the Selling Entities acknowledge that Confidential
Information is a valuable and unique asset and agree that BBT and the Selling
Entities shall not disclose any Confidential Information after the Closing Date
to any Person for any reason whatsoever, unless such information (i) is in the
public domain through no wrongful act of any such Person, (ii) has
been rightfully received from a third party without restriction and without
breach of this Agreement or (iii) is required by law to be disclosed.
(d) BBT and the Selling Entities acknowledge that the
restrictions contained in this Section 6.4 are reasonable and necessary to
protect the legitimate interests of CTB and that any violation will result in
irreparable injury to CTB. CTB shall be entitled to preliminary and permanent
injunctive relief, without the necessity of proving actual damages or posting
any bond, as well as an equitable accounting of all earnings, profits and other
benefits arising from any violation of this Section 6.4, which rights shall be
cumulative and in addition to any other rights or remedies at law or in equity
to which CTB may be entitled. In the event that any of the provisions of this
Section 6.4 should ever be adjudicated to exceed the time, geographic, product
or service, or other limitations permitted by applicable law in any
jurisdiction, then such provisions shall be deemed reformed in such jurisdiction
to the maximum time, geographic, product or service, or other limitations
permitted by applicable law.
(e) CTB, BBT and the Selling Entities intend to and do hereby
confer jurisdiction to enforce the covenants set forth in this Section 6.4 upon
the courts of any jurisdiction within the geographical scope of such covenants.
In addition to Section 14 and not in limitation thereof, if the courts of any
one or more of such jurisdictions hold such covenants unenforceable in whole or
in part, it is the intention of CTB, BBT and the Selling Entities that such
determination not bar or in any way adversely affect the right of CTB and its
Affiliates to equitable relief and remedies hereunder in courts of any other
jurisdiction as to breaches or violations of this Section 6.4, such covenants
being, for this purpose, severable into diverse and independent covenants.
6.5 Required Consents, Regulatory and other Approvals. Subject to the
fiduciary duties of the Board of Directors of BBT, as determined by such
directors in good faith after consultation with and based upon the advice of
outside legal counsel, BBT and the Selling Entities shall (a) take all
commercially reasonable steps necessary or desirable, and proceed diligently and
in good faith and use all commercially reasonable efforts, as promptly as
practicable to obtain the Required Consents, approvals or actions of, to make
all filings with and to give all notices to governmental or regulatory
authorities or any other Person required of BBT and the Selling Entities to
consummate the transactions contemplated hereby and by the Transaction
Documents, (b) provide such other information and communications to such
governmental or regulatory authorities or other Persons as CTB or such
governmental or regulatory authorities or other Persons may reasonably request
in connection therewith and (c) cooperate with CTB as promptly as practicable in
obtaining the Required Consents, approvals or actions of, making all filings
with and giving all notices to governmental or regulatory authorities or other
Persons required of CTB to consummate the transactions contemplated hereby and
by the Transaction Documents. BBT and the Selling Entities will provide prompt
notification to CTB when any Required Consent, approval, action, filing or
notice referred to in clause (a) above is obtained, taken, made or given, as
applicable, and will advise CTB of any communications (and, unless precluded by
Law, provide copies of any such communications that are in writing)
with any governmental or regulatory authority or other Person regarding any of
the transactions contemplated by this Agreement or any of the Transaction
Documents.
6.6 Publicity. Neither BBT, the Selling Entities, CTB, nor any
affiliates which they respectively control, shall issue or cause the publication
of any press release or other public statement or announcement with respect to
this Agreement or the Transactions contemplated hereby without the prior
consultation of the other parties hereto, except as may be required by law or by
obligations pursuant to applicable laws, rules, regulations and any listing
agreements.
6.7 Satisfaction of Liabilities. The Selling Entities shall, in the
ordinary course of business, fully satisfy or cause to be satisfied all third
party Liabilities and obligations of the Selling Entities relating to the
Business which are not Assumed Liabilities.
6.8 Employee Benefit Matters. CTB shall have no responsibility,
liability or other obligations with respect to any Benefit Plans of the Selling
Entities, and the Selling Entities shall be fully responsible therefore.
6.9 Business Financial Statements.
(a) Selling Entities have provided CTB with the Financial
Statements referred to in Section 4.4 above and the Financial
Information referred to in Section 6.3 above.
(b) After the Closing, the Selling Entities shall provide to
CTB and its accountants and other representatives reasonable access to
accounting and other books and records of the Selling Entities and its
personnel to permit the preparation of financial statements of the
Business required to be filed by On Stage under the Exchange Act.
6.10 Employment and Employment Benefits.
(a) CTB may, but is not obligated to, offer full-time
employment to all employees of the Selling Entities who are employed in
the Business on a full-time basis as of the Closing and (except as
required by law) who are not then absent due to serious bodily injury,
long-term sickness or disability, layoff or leave of absence. Such
employment shall be at will and shall be accomplished by assigning to
CTB and CTB assuming at or prior to Closing the employment contract of
each such employee. Such employees who accept such offered employment
are herein collectively referred to as the "Transferred Employees." CTB
may, but is not obligated to, afford to all Transferred Employees
credit for all of their years of employment with Selling Entities in
the determination of vesting and other rights under CTB's benefits
programs, including vacation time based on employment through the
Closing Date, as applicable. Selling Entities shall be responsible for,
and hold CTB harmless against, any severance payments or other
obligations (including without limitation any liability for wrongful
discharge) that may be due by reason of termination of employment of
any employees of Selling Entities who are not Transferred Employees,
whether or not such termination occurred
before or after the Closing. CTB shall be responsible for, and hold
Selling Entities harmless against, any severance payments that may be
due by reason of termination of employment of Transferred Employees by
CTB at any time after the Closing. Selling Entities shall compensate
each Transferred Employee on or before the Closing Date for all accrued
but unpaid payroll, unused vacation time, discretionary time off and
attendance or other bonuses.
(b) With respect to CTB's benefit programs, CTB may, but shall
not be obligated to, agree to waive for all Transferred Employees and
their eligible dependants (a) any eligibility waiting periods; and (b)
any pre-existing conditions and actively at work exclusions except that
CTB may require any Transferred Employee or eligible dependent who, as
of the Closing Date, is then in the process of satisfying any similar
exclusions or waiting periods under Selling Entities' benefits programs
to fully satisfy the balance of the applicable time period for such
exclusions or waiting period under CTB's benefit programs.
(c) Nothing contained in the Agreement shall confer any rights
or remedies upon any employees or consultants of Selling Entities as a
third party beneficiary. CTB and Selling Entities expressly disclaim
any and all liability to any such third party arising out of this
Agreement.
7. Conduct of the Business Prior to the Closing.
7.1 Operation in Ordinary Course. Between the date of this Agreement
and the Closing Date, BBT and the Selling Entities shall conduct the Business in
all material respects in the ordinary course and use commercially reasonable
efforts to maintain the goodwill of all current business relationships.
7.2 Business Organization. Between the date of this Agreement and the
Closing Date, each Selling Entity shall use commercially reasonable efforts to
preserve substantially intact its respective business organization and keep
available the services of each of its present officers and employees.
7.3 Corporate Organization. Between the date of this Agreement and the
Closing Date, no Selling Entity shall amend its Charter Document or bylaws in a
manner that adversely effects any of the Transactions, if applicable, and shall
not:
(a) be party to any merger, consolidation or other business
combination; or
(b) sell, lease, license or otherwise dispose of any of its
Purchased Assets (including rights with respect to the Intellectual
Property), except in the ordinary course of business.
7.4 Business Restrictions. Between the date of this Agreement and the
Closing Date, except as mutually agreed, neither BBT nor a Selling Entity shall
in relation to the Business, without the prior written consent of CTB:
(a) acquire or dispose of any of the Purchased Assets, other
than Inventory in the ordinary course of business consistent with past
practices;
(b) except in the ordinary course of business, increase in any
manner the compensation of any director or officer or increase in any
manner the compensation of any class of employees;
(c) create or materially modify any bonus, deferred
compensation, pension, profit sharing, retirement, insurance, stock
purchase, stock option, or other fringe benefit plan, arrangement or
practice or any other employee benefit plan;
(d) enter into, amend, modify, terminate (partially or
completely), grant any waiver under or give any consent with respect to
any Contract;
(e) violate, breach or default under, in any material respect,
or take or fail to take any action that (with or without notice or
lapse of time or both) would constitute a material violation or breach
of, or default under any term or provision of any Contract or any
Permit;
(f) engage in any transaction with respect to the Business
with any officer, director, Affiliate or associate of any Selling
Entity or any associate of any such officer, director or Affiliate;
(g) enter into any agreement that materially restricts it from
carrying on the Business;
(h) cancel any material debts of others or waive any material
claims or rights relating to the Business;
(i) act so as to, or omit from taking any action that would,
cause any of the representations and warranties in Section 4 to be
inaccurate in any material respect; or
(j) enter into any Contract to do or engage in any of the
foregoing.
8. Conditions Precedent to Obligations of CTB.
------------------------------------------
All obligations of CTB to consummate the Transactions are subject to
the satisfaction (or waiver by CTB) prior thereto of each of the following
conditions:
8.1 Representations and Warranties. The representations and warranties
of the Selling Entities set forth in this Agreement shall be true and correct in
all material respects on the date hereof and (except to the extent such
representations and warranties speak as of an earlier date) shall also be true
and correct in all material respects (or, in the case of representations and
warranties qualified by materiality, shall also be true and correct in all
respects) on and as of the Closing Date with the same force and effect as if
made on and as of the Closing Date.
8.2 Agreements, Conditions and Covenants. The Selling Entities shall
have performed or complied with all agreements, conditions and covenants
required by this Agreement to be performed or complied with them on or before
the Closing Date.
8.3 Officers' Certificate. CTB shall have received a certificate of an
officer of each Selling Entity to the effect set forth in Section 8.2
8.4 Required Consents and Approvals. All Required Consents, approvals
and actions of, filings with and notices to, any governmental or regulatory
authority necessary to permit CTB, BBT and the Selling Entities to perform their
obligations under this Agreement and to consummate the transactions contemplated
hereby and thereby (and to permit CTB to operate the Business after the Closing)
(a) shall have been duly obtained, made or given, (b) shall be in form and
substance reasonably satisfactory to CTB, (c) shall not be subject to the
satisfaction of any condition that has not been satisfied or waived and (d)
shall be in full force and effect, and all terminations or expirations of
waiting periods imposed by any governmental or regulatory authority necessary
for the consummation of the transactions contemplated by this Agreement and the
Transaction Documents shall have occurred.
8.5 Third Party Consents. All consents (or in lieu thereof waivers) to
the performance by CTB, BBT and the Selling Entities of their obligations under
this Agreement or to the consummation of the transaction contemplated hereby as
are required under any Contract to which CTB or the Selling Entities are a party
or by which any of their respective Purchased Assets are bound (a) shall have
been obtained, (b) shall be in form and substance reasonably satisfactory to
CTB, (c) shall not be subject to the satisfaction of any condition that has not
been satisfied or waived and (d) shall be in full force and effect, except where
the failure to obtain any such consent (or in lieu thereof waiver) could not
reasonably be expected, individually or in the aggregate with other such
failures, to materially adversely affect CTB, the Purchased Assets, the Assumed
Liabilities or the Business or otherwise result in a material diminution of the
benefits of the transactions contemplated by this Agreement to CTB.
8.6 Legality. No Law or Court Order shall be pending or threatened that
prevents or that seeks to restrain the consummation, or challenges the validity
or legality, of this Agreement or the Transactions or that would materially
limit or adversely affect CTB's acquisition of the Purchased Assets.
8.7 Title Insurance . The Selling Entities shall have obtained and
delivered to CTB the following title insurance commitments (the cost and expense
of which shall be paid one-half
by BBT and one-half by CTB) issued by a title insurance company acceptable to
CTB and its lender, if any, each in their respective sole and absolute
discretion, as to the Real Property leased by any one or more of the Selling
Entities, (i) a commitment for issuance of an ALTA Form B Leasehold Owner's
Policy of Title Insurance with extended coverage showing all endorsements
thereto which CTB may request, along with legible copies of all documents shown
as exceptions thereto and (ii) a commitment for issuance of a 1970 ALTA Form B
Leasehold Mortgagee's Policy of Title Insurance with extended coverage showing
all endorsements thereto which CTB's lender may request, along with legible
copies of all documents shown as exceptions thereto (all of the foregoing title
commitments may hereinafter be referred to collectively as the "Commitments").
In order to satisfy the provisions of this Section 8.7, each of the Commitments
must (x) be satisfactory, in form and substance, to CTB in its reasonable
discretion and CTB's lender, in such lender's sole and absolute discretion, (y)
contain no exceptions to title or the survey, except for those exceptions
approved by CTB (subject to the last sentence of this Section 8.7) and CTB's
lender, at any time prior to Closing, and (z) have the appropriate policies of
title insurance issued pursuant to and in strict accordance with each of the
Commitments at, or within five business days of their receipt of all documents
recorded in connection with the Closing, provided that if the title insurance
policies are to be issued within five business days of receipt of all documents
recorded in connection with the Closing, CTB and its lender shall each receive
at Closing, for each Commitment, a "xxxx-up" of the Commitment evidencing the
form of the title insurance policy to be issued pursuant to said Commitment and
written evidence that gap coverage will be provided. Anything set forth in this
Agreement to the contrary notwithstanding, CTB shall have the right to terminate
this Agreement (upon which Section 11.2(a) shall apply) by delivering notice of
such termination to the Selling Entities prior to the Closing if CTB in its
reasonable discretion determines that any one or more of the title exceptions or
other matters shown on any of the Commitments or the surveys are not acceptable
to CTB. BBT and the Selling Entities hereby covenant that they shall cure all
title exceptions and other matters shown on any of the Commitments other than
the items identified as "Special Exceptions" on the title report included as
part of Schedule 4.6 hereto which may be cured by payment of a sum of money not
to exceed $300,000 by execution of a document requiring the signature of no
party other than one or more of BBT or the Selling Entities or any of their
respective mortgagees, including any affidavits which may reasonably be required
by the title insurer (including a standard title insurance company form of
owner's affidavit to induce the deletion from the Commitments of any exception
for parties in possession and for mechanics' or materialmen's liens).
8.8 Real Property Leases. With respect to each of the Real Property
Leases the Selling Entities shall have delivered to CTB an estoppel certificate
and consent to assignment from the lessor thereunder in form and substance
reasonably satisfactory to CTB.
8.9 Opinion of Counsel. CTB shall have received the opinion of Xxxxxxxx
Xxxxxxxx Xxxxx & Xxxxx, counsel to the Selling Entities, in a form reasonably
acceptable to CTB
8.10 Board Approval. The execution of this Agreement and the
Transactions contemplated thereby must be approved by the Board of Directors of
On Stage.
8.11 Collateral Agreements. The Selling Entities shall have executed
and delivered each of the Collateral Agreements to which either is a party.
9. Conditions Precedent to Obligations of BBT and the Selling Entities.
All obligations of the Selling Entities to consummate the Transactions
are subject to the satisfaction (or waiver by the Selling Entities) prior
thereto of each of the following conditions:
9.1 Representations and Warranties. The representations and warranties
of CTB set forth in this Agreement shall be true and correct in all material
respects on the date hereof and (except to the extent such representations and
warranties speak as of an earlier date) shall also be true and correct in all
material respects (or, in the case of representations and warranties qualified
by materiality, shall also be true and correct in all respects) on and as of the
Closing Date with the same force and effect as if made on and as of the Closing
Date.
9.2 Agreements, Conditions and Covenants. CTB shall have performed or
complied with all agreements, conditions and covenants required by this
Agreement to be performed or complied with by it on or before the Closing Date.
9.3 Officer's Certificate. The Selling Entities shall have received a
certificate of an officer of CTB to the effects set forth in Sections 9.1 and
9.2
9.4 Legality. No Law or Court Order shall be pending or threatened that
prevents or that seeks to restrain the consummation, or challenges the validity
or legality of the Transactions.
9.5 Opinion of Counsel. The Selling Entities shall have received the
opinion of Grobl & Associates, Ltd., counsel to CTB, in a form reasonably
acceptable to the Selling Entities.
9.6 Collateral Agreements. CTB shall have executed and delivered such
of the Collateral Agreements to which it is a party or signatory.
10. Indemnification.
10.1 Indemnification by the Selling Entities. BBT and the Selling
Entities, jointly and severally, shall indemnify and hold harmless CTB and its
Affiliates (and each of its and their officers, directors, employees, agents,
successors and assigns) (each, a "CTB Indemnified Party") from, against and in
respect of any and all Liabilities, claims, demands, judgments, settlement
payments, losses, costs, damages, deficiencies, diminution in value and expenses
whatsoever (including reasonable attorneys', consultants' and other professional
fees and disbursements of every kind, nature and description incurred by such
CTB Indemnified Party in connection therewith) (collectively, "Damages") that
such CTB Indemnified Party may sustain, suffer or incur that result from, arise
out of or relate to:
(a) any Excluded Liability;
(b) (i) any breach of any representation or warranty of BBT or
any Selling Entity contained in this Agreement, including the
representations and warranties of BBT or the Selling Entities contained
in Section 4, or (ii) any breach of or any material inaccuracy in any
representation or warranty in or omission from any certificate,
schedule, exhibit, statement, document or instrument furnished to CTB
by a Selling Entity (or any of its representatives or agents) pursuant
hereto or in connection with the negotiation, execution or performance
hereof;
(c) any breach of any covenant or agreement of BBT or any
Selling Entity contained in this Agreement;
(d) any claim by any officer, former officer, employee, former
employee, shareholder or former shareholder of any Selling Entity
relating to the period prior to or at the Closing;
(e) any claim of infringement of any intellectual property
right resulting from CTB's operation of the Business as presently
operated by the Selling Entities;
(f) any Environmental Condition existing on or prior to the
Closing;
(g) any Liability or obligation of a Selling Entity involving
Taxes, except for any Taxes expressly assumed herein, due and payable
by, or imposed with respect to BBT or a Selling Entity for any taxable
periods ending on or prior to the Closing Date (whether or not such
taxes have been due and payable); or
(h) the enforcement of this Section 10.1.
10.2 Indemnification by CTB. CTB shall indemnify and hold harmless each
of BBT and the Selling Entities and their Affiliates (and each of their
officers, directors, employees, agents, successors and assigns) (each, a "BBT
Indemnified Party") from, against and in respect of any and all Damages that
such BBT Indemnified Party may sustain, suffer or incur that result from, arise
out of or relate to:
(a) any Assumed Liability;
(b) any breach by CTB of Section 6.11; or
(c) the operation of the Business after the Closing (to the
extent such Damage is not subject to Section 10.1); and
(d) the enforcement of this Section 10.2.
10.3 Limitations on Liability. Except as otherwise provided in Section
10.6 and except that this limitation shall not apply to any indemnification
claim arising under or with respect to either of Sections 4.5 and 4.23, BBT and
the Selling Entities shall not be liable to any CTB Indemnified Party under
Section 10.1(b) for any misrepresentation or breach of warranty until the
aggregate amount for which they would otherwise (but for this provision) be
liable to any or all CTB Indemnified Parties for all such misrepresentations and
breaches of warranty exceeds $100,000 (after which BBT and the Selling Entities
shall be fully responsible only for any such excess). In addition, except as
otherwise provided in Section 10.6, BBT and the Selling Entities indemnification
obligations under Section 10.1 shall not exceed $3,800,000.
10.4 Survival. Except as otherwise provided in Section 10.5, the
representations and warranties given or made by any party in this Agreement or
in any certificate or other writing furnished in connection herewith, and all
rights to assert an indemnification claim under Section 10.1(b), shall survive
the Closing for a period of two years after the Closing Date and shall
thereafter terminate and be of no further force or effect, except that (a) all
representations and warranties relating to Taxes and Tax Returns shall survive
the Closing for the period of the applicable statutes of limitation plus any
extensions or waivers thereof, (b) all representations and warranties set forth
in Sections 4.2, 4.3, 4.5, 4.6, 4.14, 4.20 and 4.23 shall survive the Closing
without limitation and (c) any representation or warranty as to which a claim
(including without limitation a contingent claim) shall have been asserted
during the survival period shall continue in effect with respect to such claim
until such claim shall have been finally resolved or settled. Each party shall
be entitled to rely upon the representations and warranties of the other party
or parties set forth herein, notwithstanding any investigation or audit
conducted before or after the Closing Date or the decision of any party to
complete the Closing.
10.5 Indemnification Procedure. All claims for indemnification under
Sections 10.1 and 10.2 shall be asserted and resolved as follows:
(a) In the event that any claim or demand for which a party
obligated to indemnify (the "Indemnifying Party") would be liable to a
party entitled to indemnification hereunder (the "Indemnified Party")
is asserted against an Indemnified Party by a third party, the
Indemnified Party shall with reasonable promptness notify the
Indemnifying Party of such claim or demand (the "Claim Notice"),
specifying the nature of such claim or demand and the amount or the
estimated amount thereof to the extent then feasible (which estimate
shall not be conclusive of the final amount of such claim or demand).
The Indemnifying Party shall have 30 days from the receipt of the Claim
Notice (the "Notice Period") to notify the Indemnified Party (i)
whether or not the Indemnifying Party disputes the Indemnifying Party's
liability to the Indemnified Party hereunder with respect to such claim
or demand and (ii) whether or not the Indemnifying Party desires, at
the sole cost and expense of the Indemnifying Party, to defend against
such claim or demand, provided that the Indemnified Party is hereby
authorized (but not obligated) prior to and during the Notice Period to
file any motion, answer or other pleading and to take any other action
which the Indemnified Party shall deem necessary or appropriate to
protect the Indemnified Party's interests. In the event that the
Indemnifying Party notifies the Indemnified Party within the Notice
Period that the Indemnifying Party does not dispute the Indemnifying
Party's obligation to indemnify hereunder and desires to defend the
Indemnified Party against such claim or demand and except as
hereinafter provided, the Indemnifying Party shall have the right to
defend (with counsel reasonably satisfactory to the Indemnified Party)
by appropriate proceedings, which proceedings shall be promptly settled
or prosecuted by the Indemnifying Party to a final conclusion; provided
that, unless the Indemnified Party otherwise agrees in writing, the
Indemnifying Party may not settle any matter (in whole or in part)
unless such settlement includes a complete and unconditional release of
the Indemnified Party. If the Indemnified Party desires to participate
in, but not control, any such defense or settlement the Indemnified
Party may do so at its sole cost and expense. If the Indemnifying Party
elects not to defend the Indemnified Party against such claim or
demand, whether by not giving the Indemnified Party timely notice as
provided above or otherwise, then the Indemnified Party, without
waiving any rights against the Indemnifying Party, may settle or defend
against any such claim in the Indemnified Party's sole discretion and,
if it is ultimately determined that the Indemnifying Party is
responsible therefore under this Section 10, then the Indemnified Party
shall be entitled to recover from the Indemnifying Party the amount of
any settlement or judgment and all indemnifiable costs and expenses of
the Indemnified Party with respect thereto, including interest from the
date such costs and expenses were incurred.
(b) If at any time, in the reasonable opinion of the
Indemnified Party, notice of which shall be given in writing to the
Indemnifying Party, any claim or demand referred to in the first
sentence of Section 10.5(a) seeks material prospective relief which
could have a materially adverse effect on the businesses, operations,
assets, properties, prospects or condition (financial or otherwise) of
any Indemnified Party, the Indemnified Party shall have the right to
control or assume (as the case may be) the defense of any such claim or
demand and the amount of any judgment or settlement and the reasonable
costs and expenses of defense shall be included as part of the
indemnification obligations of the Indemnifying Party hereunder. If the
Indemnified Party should elect to exercise such right, the Indemnifying
Party shall have the right to participate in, but not control, the
defense of such claim or demand at the sole cost and expense of the
Indemnifying Party.
(c) In the event the Indemnified Party should have a claim
against the Indemnifying Party hereunder which does not involve a claim
or demand being asserted against or sought to be collected by a third
party, the Indemnified Party shall with reasonable promptness send a
Claim Notice with respect to such claim to the Indemnifying Party. If
the Indemnifying Party does not notify the Indemnified Party within the
Notice Period that the Indemnifying Party disputes such claim, the
amount of such claim shall be conclusively deemed a liability of the
Indemnifying Party hereunder.
(d) Nothing herein shall be deemed to prevent the Indemnified
Party from making (and an Indemnified Party may make) a claim hereunder
for potential or
contingent claims or demands provided the Claim Notice sets forth the
specific basis for any such potential or contingent claim or demand to
the extent then feasible and the Indemnified Party has reasonable
grounds to believe that such a claim or demand may be made. The
Indemnified Party's failure to give reasonably prompt notice to the
Indemnifying Party of any actual, threatened or possible claim or
demand which may give rise to a right of indemnification hereunder
shall not relieve the Indemnifying Party of any liability which the
Indemnifying Party may have to the Indemnified Party unless the failure
to give such notice materially and adversely prejudiced the
Indemnifying Party.
10.6 Exception to Limitations. Nothing herein shall be deemed to limit
or restrict in any manner any rights or remedies that any party has, or might
have, at law, in equity or otherwise, against any other party hereto, based on
any willful misrepresentation, willful breach of warranty or willful failure to
fulfill any agreement or covenant.
10.7 Payment of Indemnification Obligations. In the event that any
Indemnifying Party is required to make any payment under this Section 10, such
party shall promptly pay the Indemnified Party the amount of such indemnity
obligation. If there should be a dispute as to such amount, such Indemnifying
Party shall nevertheless pay when due such portion, if any, of the obligation as
shall not be subject to dispute. The difference, if any, between the amount of
the obligation ultimately determined as properly payable under this Section 10
and the portion, if any, theretofore paid shall bear interest for the period
from the date the amount was demanded by the Indemnified Party until payment in
full, payable on demand, at the rate of 10% per annum. Notwithstanding anything
herein to the contrary, all indemnification payments to a CTB Indemnified Party
shall be satisfied first by set-off against the $2,800,000 Secured Promissory
Note pursuant to Section 10.8 until such time as the principal thereof has been
fully so reduced or paid.
10.8 Right to Set Off. CTB shall have the right to pay to any other
Indemnified Party any amount owing by an Indemnifying Party to such Indemnified
Party under Section 10.1 and to set off the amount of such payment or payments
against the payment obligations of CTB under the $2,800,000 Secured Promissory
Note, provided that any such set off shall be paid into a mutually acceptable
escrow until a final determination of the underlying claim is made pursuant to
this Article 10.
11. Termination.
11.1 Grounds for Termination. This Agreement may be terminated at any
time prior to the Closing:
(a) by mutual written consent of CTB and BBT; or
(b) by BBT or by CTB, if the Closing has not occurred prior to
January 31, 2001; provided, however, that such right to terminate this
Agreement shall not be available to any party (with BBT and the Selling
Entities collectively deemed
as one party) that has breached any of its covenants, representations
or warranties in this Agreement in any material respect (which breach
has not been cured) or has refused to sign any of the Closing
Documents, without cause; or
(c) by BBT or CTB, if there shall be any Law that makes
consummation of the Transactions illegal or otherwise prohibited or if
any Court Order enjoining BBT and the Selling Entities or CTB from
consummating the Transactions is entered and such Court Order shall
become final and nonappealable; or
(d) by CTB, if BBT or a Selling Entity shall have breached
any of its covenants hereunder in any material respect or if the
representations and warranties BBT or a of the Selling Entity contained
in this Agreement or in any certificate or other writing delivered by
BBT or a Selling Entity pursuant hereto shall not be true and correct
in any material respect, except for such changes as are contemplated by
this Agreement, and, in either event, if such breach is subject to
cure, BBT or the Selling Entities have not cured such breach within ten
business days of CTB's notice of an intent to terminate; or
(e) by BBT, if CTB shall have breached any of its covenants
hereunder or if the representations and warranties of CTB contained in
this Agreement or in any certificate or other writing delivered by CTB
pursuant hereto shall not be true and correct, except for such changes
as are contemplated by this Agreement, and, in either event, if such
breach is subject to cure, CTB has not cured such breach within ten
business days of notice of an intent to terminate; or
(f) by CTB after the occurrence of an event which could
reasonably be expected to result in a Material Adverse Effect; or
(g) by CTB if the Board of Directors of BBT or any committee
of the Board of Directors of BBT (i) shall withdraw or modify in any
adverse manner its approval or recommendation of this Agreement, (ii)
within ten days after CTB's request, shall fail to reaffirm such
approval or recommendation, (iii) shall approve or recommend any
acquisition of a material portion of its assets or the Business or any
tender offer for shares of its capital stock, in each case, other than
by CTB or an affiliate thereof, (iv) a tender offer or exchange offer
for any of the outstanding shares of BBT common stock shall have been
commenced or a registration statement with respect thereto shall have
been filed and the Board of Directors of BBT shall have recommended
that the shareholders of BBT tender their shares in such tender or
exchange offer or publicly announced its intention to take no position
with respect to such tender or exchange offer, or (v) shall resolve to
take any of the actions specified in this Section 11.1(g); or
(h) by BBT, prior to the approval of this Agreement, upon
five days' prior notice to CTB, if, as a result of discussions or
negotiations with a party other than CTB or
any of its affiliates (a "Third Party"), and (without any solicitation,
initiation, encouragement, discussion or negotiation, directly or
indirectly, by or with any Selling Entity or their representative after
the date hereof) that Third Party makes an unsolicited bona fide
written Acquisition Proposal (hereinafter defined) that BBT's Board of
Directors reasonably and in good faith believe is superior to the
transaction contemplated by this Agreement and has demonstrated that
the funds necessary for the Acquisition Proposal are reasonably likely
to be available (as determined in good faith in each case by BBT's
Board of Directors after consultation with its financial advisors) and
which Acquisition Proposal accomplishes at least the same long-term
strategic benefits afforded to the Selling Entities and BBT's
shareholders by this Agreement and the transactions contemplated hereby
(such an Acquision Proposal, a "Superior Proposal"); provided, however,
that BBT has fully complied with its obligations under Section 6.3 and
with all the applicable requirements of Section 11.2(b), including the
payment of the Termination Fee and CTB Expenses (each as hereinafter
defined); or
(i) by BBT if CTB fails to deposit $250,000 into the Escrow
Account on or before January 26, 2001; or
(j) by BBT if CTB fails to pay the $650,000 Secured Short Term
Note on or before February 15, 2001.
11.2 Effect of Termination.
(a) In the event of termination of this Agreement as provided
in Section 11.1, this Agreement shall forthwith become void and there
shall be no liability on the part of any of the parties, except (i) as
set forth in Sections 6.6, 11.2(b), 11.2(c), 12, 18 and 19, and (ii)
nothing herein shall relieve any party from liability for any willful
breach hereof.
(b) If (i) this Agreement is terminated by CTB pursuant to
Section 11.1(g) or by BBT pursuant to Section 11.1(h), (ii) either (1)
at the time of such termination there shall have been an Acquisition
Proposal (whether or not such offer shall have been rejected or shall
have been withdrawn prior to the time of such termination), or (2)
within one year after termination of the Agreement pursuant to this
Section 11.2(b) a Selling Entity shall have entered into an agreement
with respect to, or consummated, an Acquisition Proposal, BBT shall pay
to CTB an amount equal to (i) a cash termination fee of $690,000 (the
"Termination Fee"), and (ii) all expenses incurred by CTB in connection
with the negotiation, execution and performance of the transactions
contemplated hereby (including all fees and expenses payable to CTB's
financial advisors and counsel) not to exceed $250,000 ("CTB Expenses")
within one business day after such termination or, in the case of
(ii)(2), entering into an agreement with respect to, or consummating an
Acquisition Proposal. As used herein, "Acquisition Proposal" means a
proposal or offer for, or other business combination involving, a
substantial portion of the assets of the Business whether directly or
indirectly through a tender or exchange offer, merger,
consolidation or other business combination involving BBT or any other
Selling Entity or any proposal to acquire in any manner a substantial
equity interest in, or a substantial portion of the assets of, BBT or
any other Selling Entity.
(c) In the event CTB fails to deposit $250,000 into escrow
pursuant to Section 11.1(i) above, CTB shall promptly pay such amount
to BBT unless the Escrow Agent would have returned such amount to CTB
or On Stage pursuant to the provisions of the Escrow Agreement such
amount has been paid into escrow by CTB pursuant to Section 11.1(i).
12. Payment of Expenses; Bulk Sales Act; Sales and Transfer Taxes. Except as set
forth in Section 6.10(a), each party hereto shall pay its own expenses for
lawyers, accountants, consultants, investment bankers, brokers, finders and
other advisers with respect to the Transactions. Further, the parties hereby
waive compliance with the bulk sales act or comparable statutory provisions of
each applicable jurisdiction. The Selling Entities jointly and severally shall
indemnify CTB and its officers, directors, employees, agents and Affiliates in
respect of, and hold each of them harmless from and against, any and all Damages
suffered, occurred or sustained by any of them or to which any of them becomes
subject, resulting from, arising out of or relating to the failure of the
Selling Entities to comply with the terms of any such bulk sales or comparable
provisions applicable to the Transactions. It is further agreed that the Selling
Entities shall pay all federal, state and local sales, documentary and other
transfer taxes, if any, due as a result of the purchase, sale or transfer of the
Purchased Assets in accordance herewith, whether or not imposed by law on the
Selling Entities, and the Selling Entities jointly and severally shall
indemnify, reimburse and hold harmless CTB in respect of any liability for
payment of or failure to pay any such taxes or the filing of or failure to file
any reports required in connection therewith.
13. Contents of Agreement. This Agreement, together with the other Transaction
Documents, sets forth the entire understanding of the parties hereto with
respect to the Transactions and supersedes all prior agreements other than that
certain Escrow Agreement dated November 21, 2000 or understandings among the
parties regarding those matters, including that certain Letter of Intent dated
November 21, 2000 between BBT and On Stage, as amended.
14. Amendment; Parties in Interest; Assignment; Etc. This Agreement may be
amended, modified or supplemented only by a written instrument duly executed by
CTB and BBT. If any provision of this Agreement shall for any reason be held to
be invalid, illegal, or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provision hereof, and
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective heirs, legal
representatives, successors and assigns of the parties hereto. Any term or
provision of this Agreement may be waived at any time by the party entitled to
the benefit thereof by a written instrument duly executed by such party. The
parties hereto shall execute and deliver any and all
documents and take any and all other actions that may be deemed reasonably
necessary by their respective counsel to complete the Transactions.
15. Interpretation. Unless the context of this Agreement clearly requires
otherwise, (a) references to the plural include the singular, the singular the
plural, and the part the whole, (b) "or" has the inclusive meaning frequently
identified with the phrase "and/or," (c) "including" has the inclusive meaning
frequently identified with the phrase "but not limited to" and (d) all
currencies refer to United States dollars. The section and other headings
contained in this Agreement are for reference purposes only and shall not
control or affect the construction of this Agreement or the interpretation
thereof in any respect. Section, subsection, schedule and exhibit references are
to this Agreement unless otherwise specified. Each accounting term used herein
that is not specifically defined herein shall have the meaning given to it under
GAAP.
16. Remedies. The remedies provided by Section 10 shall constitute the exclusive
remedies for the matters covered thereby. With respect to any matters not
covered by such Section, any party hereto shall be entitled to such rights and
remedies as such party may have at law or in equity or otherwise for any breach
of this Agreement, including the right to seek specific performance, rescission
or restitution, none of which rights or remedies shall be affected or diminished
by the remedies provided hereunder.
17. Notices. All notices that are required or permitted hereunder shall be in
writing and shall be sufficient if personally delivered or sent by mail,
facsimile message or Federal Express or other delivery service. Any notices
shall be deemed given upon the earlier of the date when received at, or the
third day after the date when sent by registered or certified mail or the day
after the date when sent by Federal Express to, the address or fax number set
forth below, unless such address or fax number is changed by notice to the other
party hereto:
If to CTB:
Country Tonite Branson, LLC
0000 Xxxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
FAX: 000-000-0000
Attn: Xxxxxxx X. Xxxxxxx
President and CEO
If to On Stage:
On Stage Entertainment, Inc.
0000 Xxxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
FAX: 000-000-0000
Attn: Xxxxxxx X. Xxxxxxx
President and CEO
with a required copy to:
Silver State Legal
0000 Xxxx Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
FAX: 000-000-0000
Attn: Xxxxxxxxxxx X. Xxxxx, Esq.
General Counsel and Corporate Secretary
If to the Selling Entities:
Bounce Back Xxxxxxxxxxxx.xxx, Inc.
000 Xxxxxxxxx Xxxxxxxxx
Xxxxx Xxxxxxx, XX 00000
Fax: 000-000-0000
Attn: President
With a required copy to:
Xxxxxxxx Xxxxxxxx Xxxxx Xxxxx
0000Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxxxxx, XX 00000
FAX: 000-000-0000
Attn: Xxxxxx Xxxxxx, Esquire
18. Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the state of Nevada, without regard to its
provisions concerning conflict of laws.
19. Consent to Jurisdiction; Service of Process; Etc.
(a) Each party hereto irrevocably and unconditionally (i)
agrees that any suit, action or other legal proceeding (collectively,
"Suit") arising out of this Agreement may be brought and adjudicated in
the United States District Court for the Eighth Judicial District of
the State of Nevada, County of Xxxxx, if such court does not have
jurisdiction or will not accept jurisdiction, in any court of competent
civil jurisdiction in Xxxxx County, Nevada, (ii) consents and submits
to the non-exclusive jurisdiction of any such court for the purposes of
any such Suit and (iii) waives and agrees not to assert by way of
motion, as a defense or otherwise in any such Suit, any claim that it
is not subject to the jurisdiction of the above courts, that such Suit
is brought in an inconvenient forum or that the venue of such Suit is
improper.
(b) Each party hereto also irrevocably consents to the service
of any process, pleadings, notices or other papers in a manner
permitted by the notice provisions of Section 17 or by any other method
provided or permitted under applicable law. Each party hereto agrees
that final judgment in any Suit (with all right of appeal having either
expired or been waived or exhausted) shall be conclusive and that CTB
shall be entitled to enforce such judgment in any other jurisdiction of
the world by suit on the judgment, a certified or exemplified copy of
which shall be conclusive evidence of the fact and amount of
indebtedness arising from such judgment.
20. Further Assurances. At any time and from time to time after the Closing, the
parties agree to cooperate with each other, to execute and deliver such other
documents, instruments to transfer or assignment, files, books and records and
do all such further acts and things as may be reasonably required to carry out
the intent of the parties hereunder.
21. Exhibits; Schedules. The Exhibits and the Schedules hereto are intended to
be and hereby are specifically made a part of this Agreement.
22. No Benefit to Others. The representations, warranties, covenants and
agreements contained in this Agreement are for the sole benefit of the parties
hereto (and, with respect to Section 10 and related provisions of this
Agreement, the other Indemnified Parties) and the heirs, administrators,
personal representatives, successors, assigns, and they shall not be construed
as conferring any rights on any other persons.
23. Counterparts. This Agreement may be executed in counterparts, each of which
shall be binding as of the date first written above, and all of which shall
constitute one and the same instrument. Each such copy shall be deemed to be an
original, and it shall not be necessary in making proof this Agreement to
produce or account for more than one such counterpart.
24. On Stage Guaranty. On Stage hereby unconditionally guaranties all of the
representations, warranties and obligations of CTB arising under this Agreement,
including but not limited to the payment obligations of: (i) the $250,000 to be
placed into the Escrow Account on or before January 26, 2001; (ii) the $650,000
Secured Short Term Note; and (iii) the $2,800,000 Secured Promissory Note.
IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto on the day and year first written above.
COUNTRY TONITE BRANSON, LLC
By: ______________________________
Name: Xxxxxxx X. Xxxxxxx
Title: President
BOUNCE BACK XXXXXXXXXXXX.XXX, INC.
By: ______________________________
Name: Xxxx X. Xxxxxx
Title: CEO
COUNTRY TONITE ENTERPRISES, INC.
By: ______________________________
Name: Xxxx X. Xxxxxx
Title: Pres.
CRC OF BRANSON, INC.
By: ______________________________
Name: Xxxx X. Xxxxxx
Title: Pres.
ON STAGE ENTERTAINMENT, INC.
By: ______________________________
Name: Xxxxxxx X. Xxxxxxx
Title: President and CEO