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Title: |
Asset Purchase Agreement |
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Entities: |
BounceBackTechnologies.com Inc.; On Stage Entertainment, I; Schnader Harrison Segal & Lewis, LLP |
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Date: |
2001 |
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Size: |
Preview shows 32KB of 152KB total |
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Price: |
$77 |
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ID: |
#614830 |
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Start of Preview |
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ASSET PURCHASE AGREEMENT
by and among
COUNTRY TONITE BRANSON, LLC
(a Nevada limited liability company),
ON STAGE ENTERTAINMENT, INC.
(a Nevada corporation),
BOUNCEBACK TECHNOLOGIES.COM, INC.
(a Minnesota corporation),
COUNTRY TONITE ENTERPRISES, INC.
(a Nevada corporation),
and
CRC OF BRANSON, INC.
(a Missouri corporation)
{PAGE}
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
---------------
2.3 Assumed Liabilities........................................12
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2.4 Excluded Liabilities.......................................13
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2.5 Consent of Third Parties...................................13
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2.6 Purchase Price.............................................14
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2.7 Allocation of the Purchase Price...........................15
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3. Closing.............................................................15
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3.1 Location; Date.............................................15
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3.2 Closing Deliveries.........................................15
------------------
4. Representations and Warranties of the Selling Entities..............16
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4.1 Corporate Status...........................................16
----------------
4.2 Authorization..............................................16
-------------
4.3 Consents and Approvals.....................................17
----------------------
4.4 Financial Statements.......................................17
--------------------
4.5 Title to Assets and Related Matters........................17
-----------------------------------
4.6 Real Property..............................................18
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4.7 Certain Personal Property..................................19
-------------------------
4.8 Personal Property Leases...................................19
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4.9 Inventory..................................................19
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4.10 Price Guarantees...........................................19
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4.11 Liabilities................................................19
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4.12 Taxes......................................................20
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4.13 Subsidiaries...............................................20
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4.14 Legal Proceedings and Compliance with Law..................21
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4.15 Contracts..................................................22
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4.16 No Selling Entity is in Default under any Contract.........23
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4.17 Insurance..................................................23
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4.18 Intellectual Property......................................23
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4.19 Employee Relations.........................................24
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4.20 ERISA......................................................25
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4.21 Absence of Certain Changes.................................27
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4.22 Customers..................................................28
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4.23 Finder's Fees..............................................28
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4.24 Additional Information.....................................28
----------------------
4.25 Transactions with Affiliates...............................28
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4.26 Full Disclosure............................................29
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{PAGE}
5. Representations and Warranties of On Stage..........................29
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5.1 Corporate Status...........................................29
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5.2 Authorization..............................................29
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5.3 Consents and Approvals.....................................29
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5.4 Finder's Fees..............................................30
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6. Certain Agreements..................................................30
------------------
6.1 Access.....................................................30
------
6.2 Update Schedules...........................................30
----------------
6.3 Financial Information......................................30
---------------------
6.4 Restrictive Covenants......................................30
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6.5 Required Consents, Regulatory and other Approvals..........31
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6.6 Publicity..................................................32
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6.7 Satisfaction of Liabilities................................32
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6.8 Employee Benefit Matters...................................32
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6.9 Business Financial Statements.............................32
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6.10 Employment and Employment Benefits.........................33
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7. Conduct of the Business Prior to the Closing........................33
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7.1 Operation in Ordinary Course...............................34
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7.2 Business Organization......................................34
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7.3 Corporate Organization.....................................34
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7.4 Business Restrictions......................................34
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8. Conditions Precedent to Obligations of On Stage.....................35
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8.1 Representations and Warranties.............................35
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8.2 Agreements, Conditions and Covenants.......................35
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8.3 Officers' Certificate......................................35
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8.4 Required Consents and Approvals............................35
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8.5 Third Party Consents.......................................36
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8.6 Legality...................................................36
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8.7 Title Insurance............................................36
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8.8 Real Property Leases.......................................37
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8.9 Opinion of Counsel.........................................37
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8.10.....Board Approval.............................................36
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8.11 Collateral Agreements......................................37
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9. Conditions Precedent to Obligations of the Selling Entities.........37
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9.1 Representations and Warranties.............................37
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9.2 Agreements, Conditions and Covenants.......................38
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9.3 Officer's Certificate......................................38
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9.4 Legality...................................................38
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9.5 Opinion of Counsel.........................................38
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{PAGE}
9.6 Collateral Agreements......................................38
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10. Indemnification.....................................................38
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10.1 Indemnification by the Selling Entities....................38
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10.2 Indemnification by On Stage................................39
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10.3 Limitations on Liability...................................39
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10.4 Survival...................................................40
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10.5 Indemnification Procedure..................................40
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10.6 Exception to Limitations...................................42
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10.7 Payment of Indemnification Obligations.....................42
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10.8 Right to Set Off...........................................42
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11. Termination.........................................................42
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11.1 Grounds for Termination....................................42
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11.2 Effect of Termination......................................44
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12. Payment of Expenses; Bulk Sales Act; Sales and Transfer Taxes.......45
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13. Contents of Agreement...............................................45
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14. Amendment; Parties in Interest; Assignment; Etc.....................45
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15. Interpretation......................................................45
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16. Remedies............................................................46
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17. Notices.............................................................46
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18. Governing Law.......................................................47
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19. Consent to Jurisdiction; Service of Process; Etc....................47
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20. Further Assurances..................................................48
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21. Exhibits; Schedules.................................................48
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22. No Benefit to Others................................................48
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23. Counterparts........................................................48
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{PAGE}
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
{PAGE}
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 Technologies.com, 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.
{PAGE}
"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 Seidman" means BDO Seidman, 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
{PAGE}
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
{PAGE}
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 9-000-985 at Commerce Bank
of Cherry Hill, New Jersey, for the benefit of account number 31-0025234.
"Escrow Agent" means Schnader Harrison Segal & Lewis, 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. ss.ss. 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. ss.ss.
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. ss.ss. 6901 et seq., (iv) any "pollutant" as defined under the federal
Water Pollution Control Act, 33 U.S.C. ss.ss. 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
{PAGE}
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.
{PAGE}
"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).
{PAGE}
"Trademarks" means registered trademarks, registered trade name and
service marks, trademark, trade name and service mark 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.
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