AGREEMENT OF SALE
AGREEMENT made and entered into as of the 17th day of December, 1996,
by and between ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, residing at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, residing at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, residing at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ (hereinafter referred to as the "Sellers"), EASTSIDE
PLAYROBICS, INC. a domestic corporation organized and existing under and by
virtue of the Laws of the State of New York with its principal place of business
at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("EASTSIDE"), AVENUE U
PLAYROBICS, INC. a domestic corporation organized and existing under and by
virtue of the Laws of the State of New York with its principal place of business
at ▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ 11223("AVENUE U") and BAYBRIDGE PLAYROBICS,
INC. a domestic corporation organized and existing under and by virtue of the
Laws of the State of New York with its principal place of business at ▇▇▇-▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("BAYBRIDGE") and LEARNERS WORLD
INC. a domestic corporation organized and existing under and by virtue of the
Laws of the State of New York with its principal place of business at ▇▇▇ ▇▇▇▇▇▇
▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ( hereinafter referred to as "Purchaser").
WITNESSETH:
WHEREAS: EASTSIDE, AVENUE U and BAYBRIDGE presently own and operate
children's indoor playgrounds located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ and ▇▇▇-▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, respectively;
WHEREAS: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ desire
to sell all of their shares in the subject Corporations, EASTSIDE, AVENUE U and
BAYBRIDGE to Purchaser at a price of $ 775,000.00 (the "Purchase Price");
WHEREAS: EASTSIDE now has issued and outstanding One Hundred (100) common
shares, of which 33.4 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, 33.3 shares are
owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and 33.3 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
WHEREAS: AVENUE U now has issued and outstanding One Hundred (100) common
shares, of which 33.4 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, 33.3 shares are
owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and 33.3 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
WHEREAS: BAYBRIDGE now has issued and outstanding one Hundred (100) common
shares, of which 33.4 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, 33.3 shares are
owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and 33.3 shares are owned by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
WHEREAS: The Corporation's Boards of Directors have unanimously determined
that the Purchase Price is fair and that the offer of the Purchaser should be
accepted, and agree to all of the terms of this transaction;
WHEREAS: The Purchaser agrees to assume any and all obligations, financial
and otherwise of the Sellers;
NOW, THEREFORE, in consideration of the foregoing promises and the
covenants and agreements herein contained, the parties hereto hereby agree as
follows:
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1. SALE AND PURCHASE OF SHARES. The Sellers agree to sell and transfer
to the Purchaser and the Purchaser agrees to purchase, upon the terms and
conditions hereinafter set forth, the 300 shares of the common/capital stock of
the Corporations, EASTSIDE, AVENUE U and BAYBRIDGE, said shares constituting all
of the authorized and issued shares of the Corporation (hereinafter referred to
as the "Shares").
2. PAYMENT OF PURCHASE PRICE. The Purchase Price shall be paid by the
Purchaser as follows:
(a) SEVEN HUNDRED SEVENTY FIVE THOUSAND
($ 775,000.00) Dollars to be paid over a period of FOUR years, payable together
with interest at the rate of 7% per annum (hereinafter "Balance of Purchase
Price"). The monthly payment of principal and interest shall be $ and shall
commence on January 1, 1998 and monthly thereafter. In the event any payment is
later that 15 days after date due, the Purchaser shall pay a late charge of 4%
the payment due as a late charge. The $ 775,000.00 shall be evidenced by a
single Promissory Note (the "Note") representing the sums due and providing for
the payment of monthly installments. Purchaser shall sign any and all documents
necessary to secure and insure payment of the terms of the Note, including but
not limited to UCC-1's , Security Agreements, Guarantees, Affidavits and other
necessary documents. In addition, Purchaser shall pay the fees of the Seller's
attorney in connection with drafting the aforesaid documents, and Purchaser
shall provide life insurance to the Seller, naming the Seller as the Named
Beneficiary.
In the event Seller desires to sell, transfer or otherwise negotiate
the above Notes, Purchasers and/ or Guarantors shall execute any and all
documents necessary to effectuate such sale, transfer or negotiation at closing.
In the event additional documents need to be signed by the Purchasers and/or
Guarantors after closing, Purchasers and Guarantors agree to sign sign.
3. ACCEPTABLE FUNDS. All money payable under this Agreement, unless
otherwise specified, shall be paid in good check of Purchaser, payable to the
direct order of the Seller or Seller's designee, or as otherwise agreed to in
writing by the parties and their attorneys.
4. CLOSING DOCUMENTS. The Closing means the settlement of the
obligations of the Seller, Purchaser and Guarantors to each other under this
Agreement, including the payment of the purchase price to the Seller as provided
in Paragraph "2" hereof, and delivery of the closing documents provided for in
Article 5 hereof. The closing shall be held at the office of ▇▇▇▇▇ ▇. ▇▇▇▇▇,
ESQ. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, AT 9:30 AM ON OR ABOUT
DECEMBER 1996 (the "Closing Date").
5. CLOSING DOCUMENTS. At the Closing, Sellers shall execute and
deliver to Sellers' Attorney:
(a) the Certificate or Certificates for the Shares duly endorsed so as
to effectively transfer ownership of the Shares to Purchaser; As security for
the indebtedness, the Purchaser's shares shall be signed in blank and delivered,
along with the original Leases to the subject premises identified herein, to
Sellers' attorney, ▇▇▇▇▇ ▇. ▇▇▇▇▇ ("Escrowee"), to be hand in escrow by him as
provided for herein. Purchaser shall pay all costs and fees in connection with
the filing and preparation of the Security Agreement and forms, including
Sellers, attorneys, fees.
(b) letters of resignation from each director and officer of the
Corporation, effective as of the Closing Date.
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(c) the Certificate of Incorporation and other organizational documents
of the Corporation.
(d) UCC-l financing statements/forms and other forms necessary to
secure Purchaser's indebtedness.
The Stock Certificate/Certificates and all other documents shall be
held in escrow by Sellers' attorney until such time as full payment is made to
the Sellers. In the event of a default in the payment of any sums due under the
Note, the Escrow Agent shall turn over the Stock Certificates and other
documents to the Sellers, and said Sellers may then re-enter the premises.
In the event of a default, Sellers may declare the entire unpaid
principal balance due and payable, and in addition shall have all rights and
remedies provided for in the Notes and Security Agreements.
In the event Escrowee receives a Notice that there was a default in the
payment of any installment due under the Note, upon ten (10) days notice to
Purchaser, by Certified Mail, RRR, Escrowee shall deliver the Stock Certificates
to Sellers, at which time Sellers may complete the blank endorsement, thereby
transferring said shares as directed by Sellers, and Sellers may take possession
of the Original Leases to the subject premises.
At the Closing, Purchaser shall execute and deliver to Sellers:
(a) Promissory Note/Notes, Security Agreement, UCC-I's,
Guarantee and any other documents needed to secure payment of the Note/Notes.
The Security Agreement shall give Sellers a security interest in all
property, furniture, fixtures, equipment, merchandise, computers, games, stock,
inventory, accounts receivable, bank accounts and all other assets, property and
rights of the Purchaser.
(b) Assumption Agreement and any documents needed to
effectuate Purchaser and Guarantors agreement to assume any and all obligations,
financial and otherwise of the Seller, including but not limited to
(c) General Releases.
6. REPRESENTATIONS AND WARRANTIES OF PURCHASER: Purchaser represent
s and warrants
to Seller as follows:
(a) Purchaser is a corporation organized and existing under and by
virtue of the laws of the State of New York, and is duly qualified to do
business in the State of New York. Purchaser has full power and authority to
carry out and perform its undertakings and obligations as provided herein. The
execution and delivers by Purchaser of this Agreement and the consummation of
the transactions contemplated herein have been duly authorized by the Board of
Directors of Purchaser.
(b) No action, approval, consent or authorization of any governmental
authority is necessary for Purchaser to consummate the transactions contemplated
hereby.
7. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
warrants to Purchaser as follows:
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(a) Seller has full power and authority to carry out and perform its
undertakings and obligations as provided herein. The execution and delivery by
Seller of this Agreement and the consummation of the transactions contemplated
herein have been duly authorized by the Board of Directors of the Seller.
(b) No action, approval, consent or authorization of any governmental
authority is necessary for Seller to consummate the transactions contemplated
hereby.
(c) The Corporation is a corporation duly organized and existing
under and by virtue of the Laws oil the State of New York, and the Corporation
is validly existing and has not been dissolved.
(d) The Seller represents and warrants that it is the owner, free and
clear of any encumbrance, of the common shares of the Corporation referred to in
this Agreement.
8. NO OTHER REPRESENTATIONS. Purchaser acknowledges that neither
Seller nor any representatives or agents of Seller have made any representation
or warranty, express or implied, regarding the Corporation, or any thing or
matter affecting or relating to this Agreement, except as specifically set forth
in this Agreement.
9. BROKERAGE. Purchaser represents and warrants that i: has not dealt
with any broker or finder in connection with this Agreement, the purchase of the
shares from Seller or the transactions contemplated hereby, and no broker or any
other person or entity is entitled to receive any brokerage commission, finder's
fee or any type of compensation in connection with this Agreement or the
transactions contemplated hereby. Purchase shall indemnify and hold Seller
harmless from and against all liability, claim, loss, damage and/or expenses,
including reasonable attorneys fees, pertaining to any action, claim or suit,
brought by any broker, finder, or other person or entity with whom Purchaser
dealt with. The provisions of this Article io shall survive the closing.
10. STOCK.The Purchaser's Stock shall be issued and owned as follows:
One Hundred (100%) Percent of the issued and outstanding stock to be
held in the name of Purchaser.
11. RESIGNATION OF SELLER. Concurrently herewith, the Sellers shall
each submit their resignation as directors of the Corporation. The resignation
of such Directors shall take effect at the time of its submission.
12. GENERAL RELEASE. On the Closing Date, the Corporation and the
parties shall exchange general releases, each of which, however, shall contain a
provision excluding the respective obligations of the parties hereunder.
13. SURVIVAL. None of the representations, warranties, covenants or
other obligations of Seller hereunder shall survive the closing, except as
expressly provided herein. Acceptance of the ▇▇▇▇ of Sale by Purchaser shall be
deemed full and complete performance and discharge of every agreement and
obligation on the part of Seller hereunder, except those, if any, which
expressly are stated herein to survive the closing.
14. ARBITRATION. Any dispute or controversy under this Agreement
shall be determined and settled by arbitration in New York City in accordance
with the rules of the American Arbitration Association. Any award rendered
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therein shall be final and binding on the parties and judgment may be entered
thereon in any court of competent jurisdiction.
15. BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of the respective parties hereto, their legal representatives,
successors, and assigns.
16. ENTIRE AGREEMENT. This Agreement supersedes all agreements
previously made between the parties relating to its subject matter. There are no
other understandings or agreements between them. It is understood that no oral
or other representations have been made by either party to the other, and that
all agreements, representations and warranties made are incorporated herein, and
this document contains the entire agreement between the parties, and the same or
any portion thereof may not be abandoned, modified, amended, discharged or
waived without a writing signed by the parties.
17. NOTICES. All notices, demands, other communications or other
documents required or permitted to be given hereunder shall be in writing and
delivered personally or mailed by certified mail, postage prepaid, addressed to
the parties at their last known addresses.
18. NON WAIVER. No delay or failure by either party to exercise any
right under this Agreement, and no partial or single exercise of that right,
shall constitute a waiver of that or any other right, unless otherwise expressly
provided herein.
19. HEADINGS. Headings in this Agreement are for convenience only
and shall not be used to interpret or construe its provisions.
20. GOVERNING LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of New York.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
22. MISCELLANEOUS. In the event of a sale, donation, pledge,
hypothecation, assignment and/or transfer of LEARNERS WORLD INC. or the sale,
donation, pledge, hypothecation, assignment and/or transfer of any shares of
stock of LEARNERS WORLD INC., then in such event, any and all unpaid principal
balance due under the terms of the Note, shall be accelerated and shall become
due and upon such sale, and payment is to be made out of the proceeds of such
sale.
23. LEGEND ON CERTIFICATES. Every Certificate representing the Shares
of LEARNERS WORLD INC. shall bear the following legend:
THE STOCK REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO, AND MAY NOT
BE TRANSFERRED EXCEPT IN ACCORDANCE WITH, THE PROVISIONS OF THAT CERTAIN
AGREEMENT OF SALE DATED DECEMBER 1996, WHICH REQUIRES FULL PAYMENT OF ANY AND
ALL OUTSTANDING PRINCIPAL, INTEREST AND OTHER CHARGES DUE UNDER THE TERMS OF THE
PROMISSORY NOTES SIGNED PURSUANT TO THE TERMS OF SUCH AGREEMENT OF SALE.
IN WITNESS WHEREOF each of the parties hereto has executed this
Agreement as of the date and year first above written.
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Corporate Seal:
/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
EASTSIDE PLAYROBICS, INC.
BY: /S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------
AVENUE U PLAYROBICS, INC
BY: /S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
BAYBRIDGE PLAYROBICS, INC.
BY: /S/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
LEARNERS WORLD, INC.
----------------------------
BY: /S/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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