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.................................................13
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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..................................................16
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4. Representations and Warranties of the Selling Entities...................16
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4.1 Corporate Status....................................................17
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4.2 Authorization.......................................................17
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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.................................18
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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...........................................................20
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4.10 Price Guarantees....................................................20
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4.11 Liabilities.........................................................20
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4.12 Taxes...............................................................20
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4.13 Subsidiaries........................................................21
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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...........................................................24
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4.18 Intellectual Property...............................................24
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4.19 Employee Relations..................................................25
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4.20 ERISA...............................................................26
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4.21 Absence of Certain Changes..........................................28
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4.22 Customers...........................................................29
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4.23 Finder's Fees.......................................................29
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4.24 Additional Information..............................................29
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4.25 Transactions with Affiliates........................................29
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4.26 Full Disclosure.....................................................29
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5. Representations and Warranties of On Stage...............................30
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5.1 Corporate Status....................................................30
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5.2 Authorization.......................................................30
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5.3 Consents and Approvals..............................................30
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5.4 Finder's Fees.......................................................31
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6. Certain Agreements.......................................................31
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6.1 Access..............................................................31
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6.2 Update Schedules....................................................31
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6.3 Financial Information...............................................31
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6.4 Restrictive Covenants...............................................31
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6.5 Required Consents, Regulatory and other Approvals...................32
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6.6 Publicity...........................................................33
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6.7 Satisfaction of Liabilities.........................................33
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6.8 Employee Benefit Matters............................................33
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6.9 Business Financial Statements.......................................33
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6.10 Employment and Employment Benefits..................................34
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7. Conduct of the Business Prior to the Closing.............................35
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7.1 Operation in Ordinary Course........................................35
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7.2 Business Organization...............................................35
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7.3 Corporate Organization..............................................35
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7.4 Business Restrictions...............................................35
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8. Conditions Precedent to Obligations of On Stage..........................36
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8.1 Representations and Warranties......................................36
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8.2 Agreements, Conditions and Covenants................................36
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8.3 Officers' Certificate...............................................37
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8.4 Required Consents and Approvals.....................................37
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8.5 Third Party Consents................................................37
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8.6 Legality............................................................37
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8.7 Title Insurance.....................................................37
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8.8 Real Property Leases................................................38
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8.9 Opinion of Counsel..................................................38
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8.10 Board Approval......................................................36
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8.11 Collateral Agreements...............................................38
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9. Conditions Precedent to Obligations of the Selling Entities..............39
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9.1 Representations and Warranties......................................39
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9.2 Agreements, Conditions and Covenants................................39
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9.3 Officer's Certificate...............................................39
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9.4 Legality............................................................39
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9.5 Opinion of Counsel..................................................39
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9.6 Collateral Agreements...............................................39
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10. Indemnification..........................................................39
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10.1 Indemnification by the Selling Entities.........................39
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10.2 Indemnification by On Stage.....................................40
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10.3 Limitations on Liability........................................41
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10.4 Survival........................................................41
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10.5 Indemnification Procedure.......................................41
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10.6 Exception to Limitations........................................43
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10.7 Payment of Indemnification Obligations..........................43
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10.8 Right to Set Off................................................44
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11. Termination..............................................................44
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11.1 Grounds for Termination.........................................44
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11.2 Effect of Termination...........................................46
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12. Payment of Expenses; Bulk Sales Act; Sales and Transfer Taxes............46
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13. Contents of Agreement....................................................47
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14. Amendment; Parties in Interest; Assignment; Etc..........................47
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15. Interpretation...........................................................47
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16. Remedies.................................................................47
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17. Notices..................................................................48
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18. Governing Law............................................................49
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19. Consent to Jurisdiction; Service of Process; Etc.........................49
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20. Further Assurances.......................................................50
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21. Exhibits; Schedules......................................................50
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22. No Benefit to Others.....................................................50
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23. Counterparts.............................................................50
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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.
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.
(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