Document:

Asset Purchase Agreement

Exhibit
    10.1
    

    

     

    

    ASSET
      PURCHASE AGREEMENT

     

    SELLER:
      Hines Nurseries, Inc.

     

    TARGET:
      SC Hines Trenton Nursery 

     

    BUYER:
      Palmetto Perennials, LLC

     

    REAL
      ESTATE LLC: Layman Holdings, LLC

     

    DATE:
      August 29, 2007

     

     

    
 

    THIS
      AGREEMENT IS SUBJECT TO ARBITRATION UNDER THE SOUTH CAROLINA UNIFORM ARBITRATION
      ACT PURSUANT TO THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION, AS MODIFIED
      PURSUANT TO SECTION 10.9 HEREIN.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      TABLE
        OF CONTENTS

       

    

    
      	 	 	
              Page

            
	 	 	 
	TABLE
              OF DEFINED TERMS	
              i

            
	Preliminary
              Statement	
              1

            
	Statement
              of
              Agreement	
              1

            
	1.	Sale of Assets	
              1

            
	 	1.1	Transfer of Assets from
              Seller	
              1

            
	 	
              1.2  

            	Assumed Contracts	
              2

            
	 	1.3  	Excluded Assets	
              2

            
	 	1.4  	Transfer of Real Property
              by
              Seller	
              3

            
	 	1.5  	Method of Transfer	
              3

            
	 	1.6   	Possession	
              3

            
	2. 	Purchase
              Price for
              Assets	
              3

            
	 	2.1	Cash
              Payment	
              3

            
	 	2.2	Allocations	
              3

            
	 	2.3	Holdback	
              3

            
	3. 	Closing  	
              4

            
	 	3.1	Closing
              Date	
              4

            
	 	3.2	Transactions
              at Closing	
              4

            
	 	3.3	Conditions
              of Title	
              5

            
	 	3.4	Transactions
              Subsequent to Closing	
              7

            
	4.	Debts
              and Liabilities	
              9

            
	5.	Representations
              and Warranties of Seller	
              10

            
	 	5.1	Corporation’s
              Status and Standing	
              10

            
	 	5.2 	Authorization
              and Approval of Agreement	
              10

            
	 	5.3 	
              Compliance
                with Laws

            	
              10

            
	 	5.4 	Title
              to Properties	
              11

            
	 	5.5 	Litigation	
              11

            
	 	5.6 	Consents	
              11

            
	 	5.7 	Normal
              Course	
              12

            
	 	5.8 	Creditors,
              Solvency, and Bankruptcy	
              12

            
	 	5.9 	Labor
              and Employee Benefit Matters	
              12

            

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      TABLE
        OF CONTENTS

      (continued)

       

    

    
      	 	 	 	
              Page

            
	 	 	 	 
	 	5.10	Workers’
              Compensation	
              12

            
	 	5.11	Status
              of Assets	
              12

            
	 	5.12	Assumed
              Contracts	
              13

            
	 	5.13	Taxes
              and Tax Returns	
              13

            
	 	5.14	Intellectual
              Property and Software 	
              13

            
	 	5.15	Status
              of Inventory 	
              13

            
	 	5.16	
              Environmental
                Matters 

            	
              13

            
	 	5.17	Real
              Property 	
              14

            
	 	5.18	
              Pre-Closing
                Operations 

            	
              15

            
	 	5.20 	Brokerage 	
              16

            
	 	5.21 	Disclosures 	
              16

            
	 	5.22 	Knowledge 	
              16

            
	 	5.23 	No
              Other Representations or Warranties 	
              16

            
	6.	Representations and Warranties
              of
              Buyer Parties	
              16

            
	 	6.1 	Status
              and Standing of Buyer Parties 	
              16

            
	 	6.2 	Authorization
              and Approval of Agreement 	
              17

            
	 	6.3 	Consents 	
              17

            
	 	6.4 	Litigation 	
              17

            
	 	6.5 	Brokerage 	
              17

            
	 	6.6 	Buyer’s
              Independent Investigation 	
              17

            
	 	6.7 	Bulk
              Transfer Laws 	
              17

            
	7. 	Cost
              and Expenses	
              18

            
	 	7.1 	Transactional
              Costs 	
              18

            
	 	7.2 	Documentary
              Stamps 	
              18

            
	 	7.3 	
              Proration
                of Taxes and Charges 

            	
              18

            
	 	7.4 	Sales
              Taxes 	
              18

            
	8. 	Indemnity
              Rights 	
              18

            
	 	8.1 	Indemnity
              Damages	
              18

            
	 	8.2 	Seller’s
              Indemnification	
              18

            
	 	8.3 	Buyer
              Parties’ Indemnification	
              19

            

    

     

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

      
         

        
          TABLE
            OF CONTENTS

          (continued)

           

        

        
          	 	 	 	
                  Page

                
	 	 	 	 
	 	8.4 	Provisions
                  of General Application 	
                  19

                
	 	 	8.4.1   Procedures 	
                  19

                
	 	 	8.4.2   No
                  Implications	
                  19

                
	 	 	8.4.3   Settlement	
                  19

                
	 	8.5 	Limitations	
                  20

                
	 	8.6 	Exclusive
                  Remedy	
                  20

                
	 	8.7 	Mitigation	
                  20

                
	 	8.8 	Insurance
                  Coverage 	
                  20

                
	 	8.9 	Tax
                  Benefits 	
                  21

                
	10. 	Miscellaneous	
                  21

                
	 	10.1 	Entire
                  Agreement	
                  21

                
	 	10.2 	No
                  Waiver 	
                  21

                
	 	10.3 	Amendment 	
                  21

                
	 	10.4 	Notices 	
                  22

                
	 	10.5 	Severability
                  of Provisions 	
                  22

                
	 	10.6 	Successors
                  and Assigns 	
                  22

                
	 	10.7 	Counterparts 	
                  23

                
	 	10.8 	Choice
                  of Law 	
                  23

                
	 	10.10 	Usage 	
                  24

                
	 	10.11 	Further
                  Instruments and Acts 	
                  24

                
	 	10.12 	Remedies 	
                  25

                
	TABLE
                  OF EXHIBITS   	
                  27

                
	TABLE
                  OF SCHEDULES	
                  30

                

        

         

      

    

    
      
      

    

    
      iii

      
        

      

    

    
      
      

    

     

    
      TABLE
        OF DEFINED TERMS

       

      
        
          	
                  Term

                	
                  Section
                    or Exhibit

                
	 	 
	“AAA”	
                  Section
                    10.9

                
	 	 
	“Assets”	
                  Section
                    1.1

                
	 	 
	“Assumed Contracts”	
                  Section
                    1.2

                
	 	 
	“Business”	
                  Preliminary
                    Statement

                
	 	 
	“Buyer”	
                  Introduction

                
	 	 
	“Buyer Parties”	
                  Introduction

                
	 	 
	“CERCLA”	
                  Section
                    5.16

                
	 	 
	“Closing”	
                  Section
                    3.1

                
	 	 
	“Code”	
                  Section
                    3.4.1(a)

                
	 	 
	“Dispute”	
                  Section
                    10.9

                
	 	 
	“ERISA”	
                  Section
                    3.4.1(a)

                
	 	 
	“Escrow Agreement”	
                  Section
                    2.1

                
	 	 
	“Escrow Fund”	
                  Section
                    2.1

                
	 	 
	“Excluded Assets”	
                  Schedule
                    1.3

                
	 	 
	“Excluded Business”	
                  Preliminary
                    Statement

                
	 	 
	“Excluded Contracts”	
                  Section
                    1.2

                
	 	 
	“Excluded Liabilities”	
                  Section
                    4

                
	 	 
	“Hired Employees”	
                  Section
                    3.4.1(a)

                
	 	 
	“Holdback”	
                  Section
                    2.3

                
	 	 
	“Indemnity Damages”	
                  Section
                    8.1

                
	 	 
	“Intellectual Property”	
                  Schedule
                    1.1.5

                
	 	 
	“IRS”	
                  Section
                    5.13

                
	 	 
	
                  “Permitted
                    Exceptions”

                	
                  Section
                    3.3.2(c)

                

           

          
            
               

            

            
              i

              
                

              

            

            
               

            

          

           

          
            	“Plans”	
                    Section
                      3.4.1(a)

                  
	 	 
	“Pre-Closing Period”	
                    Section
                      5.18

                  
	 	 
	“Purchase Price”	
                    Section
                      2

                  
	 	 
	“RCRA”	
                    Section
                      5.16

                  
	 	 
	“Real Estate LLC”	
                    Introduction

                  
	 	 
	“Real Property”	
                    Section
                      1.4

                  
	 	 
	“Rules”	
                    Section
                      10.9

                  
	 	 
	“SARA”	
                    Section
                      5.16

                  
	 	 
	“Seller”	
                    Introduction

                  
	 	 
	“SuperFund”	
                    Section
                      5.16

                  
	 	 
	“Tax Returns”	
                    Section
                      5.13

                  
	 	 
	“Taxes”	
                    Section
                      5.13

                  
	 	 
	“Title Commitment”	
                    Section
                      3.3.2(a)

                  
	 	 
	“Title Company”	
                    Section
                      3.3.2(a)

                  
	 	 
	“Transaction Documents”	
                    Section
                      5.2

                  

          

        

      

       

      
        
           

        

        
          ii

          
            

          

        

        
           

        

      

       

      THIS
        AGREEMENT IS SUBJECT TO ARBITRATION UNDER THE SOUTH CAROLINA UNIFORM ARBITRATION
        ACT PURSUANT TO THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION, AS MODIFIED
        PURSUANT TO SECTION 10.9 HEREIN.

       

      ASSET
        PURCHASE AGREEMENT

       

      THIS
        ASSET PURCHASE AGREEMENT, is made and entered into as of the 29th day of
        August,
        2007, by and among Hines Nurseries, Inc., a California corporation (“Seller”);
        Palmetto Perennials, LLC, a South Carolina limited liability company (“Buyer”);
        and Layman Holdings, LLC, a South Carolina limited liability company (the
“Real
        Estate LLC”, and collectively with Buyer, “Buyer Parties”).

       

      Preliminary
        Statement

       

      Seller
        owns and operates, among other operations, a nursery business selling plants
        and
        related products and services at its facilities located on Highway 25 (Trenton)
        and Highway 191 (Mill Creek) in Edgefield County and known as the SC Hines
        Trenton Nursery (collectively, the “Business”). Seller has operated the Business
        continuously since August 1996. Seller also operates seven (7) commercial
        nursery facilities located in Arizona, California, Oregon and Texas
        (collectively, the “Excluded Business”). The Excluded Business is not a part of
        the “Business” for purposes of this Agreement. 

       

      Seller
        desires to sell, and Buyer and the Real Estate LLC desire to purchase,
        substantially all assets of Seller used in the conduct of the Business,
        including without limitation the fixtures and equipment (including without
        limitation approximately 5,000 to 6,000 racks); all supplies, work-in-process,
        and inventory (including without limitation all pots on hand, all perennials
        and
        other saleable plants, and all pots and supplies on order); all the trade
        names
        and trademarks of the Business (including without limitation “Iverson
        Perennials” and excluding names and marks using the word “Hines” or any
        derivations thereof); selected customer contracts, purchase orders, and
        operating contracts and leases of the Business approved for transfer by Seller
        and Buyer and applicable lessors, if any; selected other assets and rights
        used
        in the operation of the Business; and the real estate and improvements where
        the
        Business is currently operated, in each case, pursuant to the terms hereof.
        In
        connection with such purchase, Buyer will also assume certain identified
        liabilities, and only such identified liabilities, of the Business as set
        forth
        herein. 

       

      NOW,
        THEREFORE, in consideration of the premises hereof, the mutual covenants
        and
        agreements herein contained, and other good and valuable consideration, the
        receipt and sufficiency of which are hereby acknowledged, and subject to
        the
        terms, conditions, and exceptions set forth below, the parties hereto agree
        as
        follows:

       

      Statement
        of Agreement

       

      1.    Sale
        of Assets.

       

      1.1  Transfer
        of Assets from Seller.
        At the
        Closing, for the consideration herein provided, Seller shall convey, transfer,
        assign, and deliver to Buyer, and Buyer shall purchase and accept from Seller,
        all of the Seller’s right, title and interest in and to the following assets
        that are used in the Business (but excluding the Excluded Assets (as defined
        in
Section
        1.3))
        (collectively the “Assets”):

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

         

      

      1.1.1  All
        of
        Seller’s plant, machinery, equipment (including, without limitation, not fewer
        than 5,000 racks), tools, instruments, spare parts, trucks, forklifts and
        other
        vehicles, furniture, fixtures, furnishings, office equipment, computer hardware,
        and supplies used solely in connection with the Business, including (without
        limitation) those items described in Schedule
        1.1.1.

       

      1.1.2  All
        of
        Seller’s cellular telephone numbers described in Schedule 1.1.2.

       

      1.1.3  [RESERVED].

       

      1.1.4  All
        of
        Seller’s supplies, raw materials, items on order, work-in-process, finished
        goods, and other inventory (including without limitation all pots on hand,
        all
        perennials and other saleable plants, and all pots and supplies on order),
        at
        Seller’s Real Property, or elsewhere, with respect to the Business. See
Schedule
        1.1.4
        for a
        report of Seller’s inventory as of Closing.

       

      1.1.5  All
        of
        Seller’s trademarks (including without limitation “Iverson Perennials” and
        excluding names and marks using the word “Hines” or any derivations thereof),
        service marks, and trade names used solely in connection with the Business
        described in Schedule
        1.1.5
        (collectively the “Intellectual Property”).

       

      1.1.6  All
        of
        Seller’s Zebra printers and related label matrix software used solely in the
        Business listed in Schedule 1.1.6,
        and all
“off the shelf” local software listed in Schedule 1.1.6,
        used in
        the Business and located at the Real Property, but excluding any of Seller’s
        proprietary software and any software subject to a license that applies to
        all
        of Seller’s facilities (collectively, the “Software”).

       

      1.1.7  To
        the
        fullest extent permitted by law, the other assets listed in Schedule 1.1.7.

       

      1.2  Assumed
        Contracts.
        Seller
        shall assign all of its rights and obligations, and Buyer Parties (as
        applicable) shall assume and agree to pay, perform or otherwise discharge
        as the
        same shall become due in accordance with the respective terms, all liabilities
        and obligations under the agreements, contracts, and arrangements listed
        in
Schedule
        1.2
        (collectively the “Assumed Contracts”); provided however, that anything
        contained in this Agreement to the contrary notwithstanding, Buyer Parties
        shall
        assume only obligations maturing on or after the time of completion of Closing
        under or with respect to the Assumed Contracts. Seller shall retain all contacts
        associated with the Business other than the Assumed Contracts (the “Excluded
        Contracts”).

       

      1.3  Excluded
        Assets.
        Anything contained in this Agreement to the contrary notwithstanding, the
        parties acknowledge and agree that Seller will not sell, assign, or convey
        to
        Buyer, and Buyer will not acquire, any right, title, or interest whatsoever
        in
        or to, or obligation for, any asset or contract related to the Business other
        than Assets described in Section 1.1
        and
        Assumed Contracts described in Section 1.2
        or any
        inventory, property, item, cash, accounts receivable, deposits, security
        deposits, prepaid assets, contract, agreement or other asset of Seller related
        to the Excluded Business (collectively, “Excluded Assets”). The term “Assets” as
        used herein shall not include the Excluded Assets. Seller will make reasonable
        efforts to complete removal of tangible personal property constituting portions
        of the Excluded Assets located at the Premises, if any, within ten (10) business
        days after Closing. Buyer shall not be an insurer of the safety or condition
        of
        the Excluded Assets after Closing; and Seller shall retain the risk of loss
        with
        respect to any Excluded Assets after Closing.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

         

      

      1.4  Transfer
        of Real Property by Seller.
        At the
        Closing, for the consideration herein provided, Seller shall convey, transfer,
        assign, and deliver to Real Estate LLC, and Real Estate LLC shall purchase
        and
        accept from Seller, all of the Seller’s right, title and interest in and to the
        real property described on Schedule
        1.4,
        together with all rights whatsoever, including any improvements, trees,
        riparian, oil, gas and mineral rights, privileges, easements, interests and
        appurtenances thereto (collectively, the “Real Property”). 

       

      1.5  Method
        of Transfer.
        The
        aforesaid transfer and sale will be evidenced by appropriate bills of sale,
        assignments, deeds, titles, leases, subleases, and other instruments executed
        and delivered by Seller to Buyer Parties at Closing, as set forth in this
        Agreement.

       

      1.6  Possession.
        Buyer
        Parties shall take, and Seller shall deliver, possession of the Assets, the
        Assumed Contracts and Real Property, at Closing.

       

      2.    Purchase
        Price for Assets.
        The
        aggregate purchase price (the “Purchase Price”) for the Assets, the Assumed
        Contracts and the Real Property shall be paid, allocated and held as
        follows:

       

      2.1  Cash
        Payment.
        Buyer
        Parties shall pay to Seller, in cash or other immediately available funds
        at
        Closing an amount equal to Five Million Two Hundred Thousand and No/100 Dollars
        ($5,200,000.00), and Buyer shall direct Wachovia Bank, N.A. to deliver to
        Seller
        at Closing the Five Hundred Thousand and No/100 Dollars ($500,000.00) held
        in
        escrow by Wachovia Bank, N.A. pending Closing (the “Deposit”). Buyer shall be
        entitled to retain all interest earned on the Deposit.
        In
        addition to the other customary Closing disbursements disclosed in the Closing
        Statement to be executed by Buyer Parties and Seller at Closing, Seller shall
        require that $31,309.16 (the “Escrow Fund”) of the proceeds be paid to Fidelity
        National Insurance Company Title Company under that certain Agreement with
        Deposit to Protect Against Defects in Title (the “Escrow Agreement”), to be
        executed and delivered by Seller to Title Company at Closing.

       

      2.2  Allocations.
        The
        parties agree that the purchase price for the Assets, the Assumed Contracts
        and
        the Real Property shall be allocated, and the transaction shall be reported
        on
        all tax returns (including IRS Form 8594), as provided in Exhibit
        2.2.

       

      2.3  Holdback.
        Notwithstanding anything contained in this Agreement to the contrary, to
        the
        extent that fewer than 5,000 racks shall be at the Real Property at Closing,
        (i)
        Buyer Parties shall retain Fifty Thousand and No/100 Dollars ($50,000.00)
        (the
“Holdback”) of the purchase price set forth in Section
        2.1
        until
        such time that Seller has delivered to Buyer at the Real Property, at Seller’s
        expense, 5,000 racks in the aggregate, and (ii) Buyer Parties shall provide
        to
        Seller a grace period of 60 days after the completion of the Closing (the
“Grace
        Period”) to deliver such 5,000 racks to Buyer at the Real Property. Upon Buyer’s
        receipt of 5,000 racks, Buyer shall promptly remit to Seller the Holdback
        in
        cash or other immediately available funds. If Seller has not delivered to
        Buyer
        5,000 racks in the aggregate within the Grace Period, Buyer shall be entitled
        to
        retain the Holdback. Seller and Buyer Parties agree that 4,497 racks were
        delivered to Buyer at the Real Property at Closing.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

         

      

      3.    Closing.

       

      3.1  Closing
        Date.
        The
        closing of the sale and purchase of the Assets, the Assumed Contracts and
        the
        Real Property and related transactions (the “Closing”) shall take place on
        August 29, 2007 at 10:00 a.m., at the offices of Nexsen Pruet, LLC, 1230
        Main
        Street, Suite 700, Columbia, South Carolina, or at such other time or place
        as
        may be mutually agreed by the parties in writing. The parties intend to
        accommodate a remote closing to the extent practicable through the use of
        email,
        facsimile, and wire transfer. 

       

      3.2  Transactions
        at Closing.
        At the
        Closing:

       

      3.2.1  The
        Buyer
        Parties shall deliver to Seller the Purchase Price via wire transfer in
        immediately available funds to such bank account as directed by
        Seller.

       

      3.2.2  Seller
        shall deliver to Buyer the bill(s) of sale for tangible personal property
        and
        fixtures composing portions of the Assets in form and substance reasonably
        agreed to between Seller and Buyer.

       

      3.2.3  Seller
        shall deliver to Real Estate LLC one or more deeds for the Real Property
        in form
        and substance reasonably agreed to between Seller and Real Estate LLC
        (collectively, the “Deeds”).

       

      3.2.4  Seller
        shall deliver to Buyer an assignment of all intangible personal property
        comprising portions of the Assets, in form and substance reasonably agreed
        to
        between Seller and Buyer, together with valid written consents to assignment
        as
        required.

       

      3.2.5  Seller
        shall deliver, or cause to be delivered, to Buyer valid assignments, licenses,
        or sublicenses of all Intellectual Property in suitable form for recordation
        or
        filing, as applicable, and in form and substance reasonably agreed to between
        Seller and Buyer.

       

      3.2.6  Seller
        shall deliver to Buyer certificates, vehicle titles, and other instruments
        required to effect the sale of Assets contemplated hereby, in form and substance
        reasonably agreed to between Seller and Buyer.

       

      3.2.7  Buyer
        shall deliver to Seller an assumption agreement of all Assumed Contracts,
        if
        any, in form and substance reasonably agreed to between Seller and Buyer,
        together with valid written consents to assignment as required.

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

         

      

      3.2.8  Seller
        shall deliver to Buyer copies of duly filed UCC termination statements (or
        UCC
        termination statements duly authorized for filing), lease termination
        statements, and mortgage, mechanics lien, and other lien satisfactions, estoppel
        certificates, and other documents, as are reasonably agreed to by Buyer and
        Seller to evidence Seller’s clear and marketable title to the Assets and the
        Real Property in accordance with this Agreement.

       

      3.2.9  Seller
        shall deliver to Buyer any and all other instruments required, including
        customary title insurance certificates and affidavits, to effect the conveyance
        of title to the Assets and Real Property in accordance with Section
        3.3.

       

      3.2.10  Seller
        shall deliver to Buyer an officer’s certificate for Seller in form and substance
        reasonably agreed to between Seller and Buyer.

       

      3.2.11  Buyer
        Parties shall cause the delivery of a duly executed Guaranty dated as of
        the
        date hereof, by Layman Wholesale Nurseries, Inc., in form and substance
        reasonably agreed to between Seller and Buyer.

       

      3.2.12  Each
        of
        the Buyer Parties shall deliver to Seller a manager’s certificate for each
        respective Buyer Party in form and substance reasonably agreed to between
        Seller
        and the Buyer Parties.

       

      3.2.13  Buyer
        may, subject to the exercise of Buyer’s sole discretion, offer immediately or
        thereafter to hire any or all employees of Seller directly and primarily
        associated with the Business. Buyer shall be obligated to hire only those
        employees of Seller which Buyer elects in its sole discretion to hire; provided
        however, Buyer shall not assume any liability whatsoever which arose out
        of or
        is related to Seller’s employment of any employee, and Buyer shall not assume
        any liability whatsoever to any employee of Seller not hired by Buyer. Seller
        will be responsible for: (i) paying and reporting all costs and liabilities,
        including but not limited to compensation, vacation pay, severance, federal
        and
        state withholding taxes, federal and state unemployment taxes, employee benefit
        costs and employee benefit continuation obligations, and worker’s compensation
        claims incurred or accrued prior to Closing; (ii) the giving of all COBRA
        and
        related notices and benefits; and (iii) the giving of all federal WARN Act
        notices, if any, and notices required by any similar state statute or
        regulation, including without limitation S.C. Code Ann. §41-1-40. Seller will
        release all employees subsequently hired by Buyer from any employment and/or
        confidentiality or non-competition agreement previously entered into by Seller
        and such employees or, at the request of Buyer, will assign such agreements
        to
        Buyer. The parties agree that this transaction is intended to qualify under
        the
        exclusion of 29 U.S.C.A. §2101(b)(1) and shall cooperate reasonably in
        satisfying the requirements to so qualify.

       

      3.2.14  Seller
        and Buyer Parties shall cooperate in the recording and/or filing of all Deeds,
        mortgage satisfactions, UCC termination statements, and all other documents
        required to be filed in connection with the Closing.

       

      3.2.15  Seller
        shall execute and deliver the Escrow Agreement, and deliver the Escrow Fund,
        to
        Title Company at Closing.

       

      
        
           

        

        
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      3.2.16  The
        parties will take such other actions required at Closing by this
        Agreement.

       

      3.3  Conditions
        of Title.
        

       

      3.3.1  Operating
        Assets.
        At
        Closing, Seller shall convey marketable title to the Assets (other than the
        Real
        Property) by appropriate instruments of conveyance free and clear of all
        security interests, claims, liens, and encumbrances except: (a) taxes,
        assessments or governmental charges or levies which are not yet due (which
        shall
        be prorated as provided in Section
        7
        of this
        Agreement); and (b) as provided in Schedule
        3.3.1.

       

      3.3.2  Real
        Property; Title and Survey Matters.
        

       

      (a)  Receipt.
        Real
        Estate LLC has been provided with a title insurance commitment covering the
        Real
        Property, together with complete copies of all instruments referred to therein
        as exceptions to title (collectively the “Title Commitment”) prepared by
        Fidelity National Title Insurance Company (“Title Company”) as follows: title
        commitment no. 24050-585.

       

      (b)  Prior
        to
        the execution of this Agreement, Real Estate LLC has had an opportunity to
        review and approve: (a) the Title Commitments and all supplements thereto,
        and
        all exceptions to title referred to therein, (b) all additional matters,
        if any,
        affecting title to the Real Property disclosed by Seller to Real Estate LLC
        in
        writing, and (c) all matters which would be disclosed by ALTA surveys of
        the
        Real Property prepared in accordance with the 2005 Minimum Detail Requirements
        for ALTA/ACSM Land Title Surveys (collectively, “Title and Survey Matters”).
        Real Estate LLC has had the opportunity, at its sole cost and expense, to
        obtain
        surveys of the Real Property. In no event shall Real Estate LLC’s obtaining of
        such survey(s) be a condition precedent to Real Estate LLC’s obligations
        hereunder. In the event that Real Estate LLC obtains any survey(s), it shall
        promptly provide Seller with a copy of such survey(s). By its execution of
        this
        Agreement, Real Estate LLC has hereby approved all Title and Survey Matters
        and
        Real Estate LLC further acknowledges and agrees that Real Estate LLC shall
        not
        have any right to terminate this Agreement regarding any of the Title and
        Survey
        Matters; provided, however, Seller shall cause the following exceptions to
        title
        to the Real Property to be removed prior to the Closing (collectively, the
        “Disapproved Exceptions”): monetary encumbrances on the Real Property caused by
        or at the direction of Seller but expressly excluding (x) real property taxes
        and assessments constituting a lien not yet due and payable and (y) liens
        and
        encumbrances caused or permitted to occur by Real Estate LLC in connection
        with
        Real Estate LLC’s entry upon and inspection of the Real Property.

       

      (c)  Real
        Estate LLC shall be obligated to accept title to the Real Property subject
        only
        to the following exceptions to title (collectively, the “Permitted Exceptions”):
        (a) ad valorem real estate taxes and assessments for the year 2007 and
        subsequent years, a lien not yet due and payable; (b) the lien of supplemental
        taxes assessed with respect to matters occurring on or after the Closing
        Date;
        (c) the printed exceptions which appear in the Owner’s Title Policies issued by
        the Title Company; (d) all Title and Survey Matters approved or deemed approved
        by Real Estate LLC pursuant to this Agreement; and (e) any matters affecting
        the
        Real Property which are created by or with the consent of Real Estate LLC,
        including, without limitation, any matters relating to entitlements sought
        by
        Real Estate LLC prior to the Closing. Conclusive evidence of the availability
        of
        such title shall be the irrevocable commitment of the Title Company to issue
        to
        Real Estate LLC on the Closing Date an ALTA policy of title insurance for
        each
        of the Fee Properties 

       

      
        
           

        

        
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      (“Owner’s
        Title Policies”) in the amount of the Purchase Price allocated to the applicable
        the Real Property in Section 2.2, respective, which Owner’s Title Policies shall
        reflect that title to the Real Property is vested of record in Real Estate
        LLC,
        subject only to the Permitted Exceptions. In the event that Real Estate LLC
        desires any endorsements to the Owner’s Title Policies, Real Estate LLC shall
        separately negotiate such endorsements with the Title Company and
        notwithstanding anything else to the contrary herein, Real Estate LLC’s
        obligations under this Agreement shall not be conditioned or contingent on
        Real
        Estate LLC obtaining the issuance of any such endorsements, and the Closing
        shall not be delayed for Real Estate LLC’s failure to obtain the issuance of any
        such endorsements. Notwithstanding the foregoing, Real Estate LLC’s acceptance
        of a title policy in any form other than the form of Owner’s Title Policy
        described above shall be deemed to be Real Estate LLC’s acceptance of title to
        the Real Property, subject to any exceptance set forth in such title
        policy.

       

      3.4  Transactions
        Subsequent to Closing.

       

      3.4.1  Employment
        Matters.

       

      (a)  Employee
        Benefit Plans.
        Effective as of Closing, all employees of the Business hired by Buyer in
        Buyer’s
        discretion pursuant to Section
        3.2.13
        (the
“Hired Employees”) shall cease to be active participants in any “employee
        benefit plan”, as that term is defined in Section 3(3) of the Employee
        Retirement Income Security Act of 1974, as amended (“ERISA”), of Seller
        (collectively the “Plans”), in accordance with the terms of the Plans and
        applicable laws, including ERISA and the Internal Revenue Code of 1986, as
        amended (the “Code”). Seller shall retain liability for all claims incurred by
        employees of Seller (and their enrolled dependents) under the Plans prior
        to
        Closing. Buyer shall be liable for all claims incurred by Hired Employees
        (and
        their enrolled dependents) after Closing, but only to the extent covered
        under
        the employee welfare benefit plans of Buyer on and after Closing. For purposes
        of this Section
        3.4.1(a),
        a claim
        shall be deemed to have been incurred on the earlier of the date the service
        was
        rendered or the date of submission of a claim related thereto.

       

      (b)  Seller
        Responsibility.
        Seller
        shall make all severance, vacation, or related payments to any employees
        directly and primarily associated with the Business entitled to same or as
        required by law, and shall make available group health insurance coverage
        to any
        former employee of Seller entitled thereto pursuant to COBRA at such employee’s
        cost as required by law.

       

      (c)  Non-Solicitation.
        Except
        as provided in Section
        3.2.15,
        from
        the date hereof to the first anniversary of the date of Closing, neither
        Seller
        nor any affiliate of Seller shall solicit or encourage any employee of Buyer
        to
        leave the employ of, or cease to be under contract to, Buyer; provided, however,
        that this Section shall not prohibit any customary advertisement in a newspaper
        or trade journal of general circulation or general solicitation through an
        independent search firm (or hiring as a result thereof) seeking in the ordinary
        course of business applicants for job openings for Seller so long as such
        customary advertisements and general solicitations are not by content or
        otherwise specifically directed to the employees of Buyer.

       

      
        
           

        

        
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      3.4.2  Taxes.
        Seller
        shall file such tax returns and reports, and pay such taxes, as are required
        for
        periods ending with the Closing.

       

      3.4.3  [RESERVED].
        

       

      3.4.4  Excluded
        Assets.
        Seller
        or its respective designees shall remove the tangible personal property
        constituting portions of the Excluded Assets from the Premises, and Buyer
        shall
        cooperate with such removal, as provided in Section
        1.3.

       

      3.4.5  Books
        and Records.
        

       

      (a)  Seller
        shall preserve all books and records relating to the Business, which are
        not
        transferred to Buyer hereunder, for a period of at least three (3) years
        and
        shall make same reasonably available to Buyer and Buyer’s representatives for
        inspection to the extent reasonably requested by Buyer in connection with
        (a)
        any audit or other investigation by any governmental authority, (b) preparation
        by Buyer of tax returns or any other reports or submissions to any governmental
        entity required to be made by Buyer, (c) review of accounting records in
        order
        to reconcile any payments received pursuant to Section
        3.4.8;
        provided that such cooperation and availability of information do not
        unreasonably interfere with the normal business of Seller and provided, further,
        that Buyer reimburses Seller for any necessary third-party expenses reasonably
        incurred to provide such information, or (d) any dispute with a third party
        with respect to the Assumed Contracts, or with respect to any aspect of the
        Business if such dispute relates in whole or in part to events, acts, or
        omissions prior to Closing.

       

      (b)  Buyer
        shall preserve all books and records relating to the Business, which are
        transferred to Buyer hereunder, for a period of at least three (3) years
        and
        shall make same reasonably available to Seller and Seller’s representatives for
        inspection the extent reasonably requested by Seller in connection with (a)
        any
        audit or other investigation by any governmental authority, (b) preparation
        by
        Seller of tax returns or any other reports or submissions to any governmental
        entity required to be made by Seller, (c) review of accounting records in
        order
        to reconcile any payments received pursuant to Section
        3.4.8;
        provided that such cooperation and availability of information do not
        unreasonably interfere with the normal business of Buyer and provided, further,
        that Seller reimburses Buyer for any necessary third-party expenses reasonably
        incurred to provide such information, or (d) any dispute with a third party
        with respect to the Assumed Contracts, or with respect to any aspect of the
        Business if such dispute relates in whole or in part to events, acts, or
        omissions after Closing.

       

      3.4.6  Trade
        Name.
        Seller
        shall discontinue commercial use of the Intellectual Property, except that
        Seller shall be entitled to continued reasonable use of the Intellectual
        Property for purposes of paying or terminating obligations, collecting
        receivables, concluding its affairs related to the Business, or completing
        other
        actions specifically contemplated by this Agreement.

       

      3.4.7  [RESERVED].

       

      
        
           

        

        
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      3.4.8  Accounts
        Receivable.
        Buyer
        shall cooperate with Seller’s attempts to collect accounts receivable
        constituting portions of the Excluded Assets, and Buyer will receive in trust
        and promptly pay over to Seller any proceeds of such accounts receivable
        existing at Closing that are paid to Buyer after the Closing. Seller will
        receive in trust and promptly pay over to Buyer any proceeds of Buyer’s account
        receivable relating to periods after Closing. As between Seller and Buyer,
        payments by each customer will be applied to the specific invoice(s) identified
        by the customer in connection with such payment, and if no such identification
        is made, to such customer’s invoices in the chronological order in which they
        were issued, with the oldest invoice being paid first.

       

      3.4.9  Transition.
        Seller
        will, at no cost to Buyer, cause Seller’s management team to be available to
        answer or discuss any questions or concerns of Buyer relating to the transition
        of the Assets and Real Property for a period of 60 days after Closing.

       

      3.4.10  Racks.
        After
        Closing, Seller shall deliver to Buyer or make available for retrieval by
        Buyer
        from mutually convenient locations, at Buyer’s expense, all racks associated
        with the Business or the trademark “Iverson Perennials” which come into the
        possession or control of Seller.

       

      3.4.11  Unusable
        Supplies, Labels, and Tags.
        After
        Closing, Buyer shall deliver to Seller or make available for retrieval by
        Seller
        from Buyer’s facility at the Real Property, at Seller’s expense, all supplies,
        labels, tags, and other inventory Assets that Buyer is unable to use in the
        Business after Closing, as agreed to by Buyer and Seller. 

       

      3.4.12  [RESERVED].

       

      3.4.13  No
        Acceptance on Seller’s Behalf.
        Buyer
        Parties shall use commercially reasonable efforts not to accept delivery
        of
        goods shipped to, or ordered by or intended for Seller. Buyer Parties shall
        be
        responsible for all liabilities and obligations relating to or arising out
        of
        any goods shipped to, ordered by or intended for Seller which are accepted
        and
        retained by Buyer Parties, and to the extent that Seller has paid for any
        such
        goods accepted and retained by Buyer Parties, Buyer Parties shall promptly
        reimburse Seller for any such amounts. For all other goods shipped to, or
        ordered by or intended for Seller that Buyer accepts but does not wish to
        retain, Buyer shall notify Seller and make such goods available for pickup
        by
        Seller at Seller’s expense, and Seller shall remain responsible for all
        liabilities and obligations relating to or arising out of such
        goods.

       

      3.4.14  Access
        to Premises.
        Buyer
        Parties agree, without cost, after the Closing, to permit Seller and a
        reasonable number of Seller’s employees, agents and representatives access to
        the Real Property during normal business hours and at other reasonable times
        for
        a proper purpose in order to perform post-closing activities; provided, however,
        that such access does not unreasonably interfere with the normal business
        of
        Buyer, and that Seller shall indemnify, defend and hold harmless Buyer Parties
        and their respective managers, members, employees, and agents from and against
        any and all claims for liabilities, issues, costs, expenses (including
        reasonable attorneys’ fees), damages, or injuries arising out of or related to
        such access to the Real Property. Seller shall provide Buyer Parties with
        one
        day prior written notice before any such access, and if required by Buyer
        Parties, Seller shall execute and deliver to Buyer Parties a customary
        confidentiality agreement in form and substance reasonably agreed to by Seller
        and Buyer Parties.

       

      
        
           

        

        
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      3.4.15  Delivery
        of Cisco Server.
        As soon
        as practicable after Closing, but in any event no later than 10 days after
        Closing, Seller shall deliver to Buyer one Cisco Series 2600 router with
        a fresh
        IOS.

       

      4.    Debts
        and Liabilities.
        Except
        as specifically provided in Section
        1.2,
        Seller
        shall remain responsible for, and Buyer Parties shall not assume any, and
        expressly disclaim all, obligations or liabilities of Seller, contingent
        or
        absolute, including (without limitation) liabilities for (i) federal or state
        income, property, payroll, withholding, sales or other taxes for any period,
        (ii) any tort, contract, warranty, statutory, or other liability resulting
        from
        or alleged to have resulted from the Business, Seller’s ownership of the Assets
        or the Real Property, or the operations of Seller prior to the Closing, except
        for Buyer’s obligations arising after Closing to perform certain obligations
        under the Assumed Contracts expressly assumed by Buyer hereunder, (iii) the
        Excluded Business, the Excluded Contracts, and Excluded Assets, (iv) all
        trade
        accounts payable and other current liabilities of Seller, (v) all long-term
        and
        other liabilities of Seller, including without limitation any and all secured
        indebtedness or other obligations, (vi) Seller’s employee benefit plans and
        employee benefit continuation obligations, and (vii) compliance or
        non-compliance with the Bulk Transfer provisions of the Uniform Commercial
        Code
        of any applicable jurisdictions and the payment of any liabilities imposed
        upon
        Seller or Buyer under such Bulk Transfer provisions (collectively, the “Excluded
        Liabilities”).

       

      5.    Representations
        and Warranties of Seller.
        Seller
        hereby warrants and represents to Buyer Parties as follows:

       

      5.1  Corporation’s
        Status and Standing.
        Seller
        is a corporation which is duly organized, validly existing, and in good standing
        under the laws of the State of California and has all corporate power and
        authority to conduct its business as such business is now being conducted.
        Seller is duly qualified or licensed as a foreign corporation under the laws
        of
        all jurisdictions in which the ownership, leasing, or use of its assets or
        the
        conduct of its business require it to be so qualified or licensed, except
        where
        the failure to be so qualified would not have a material adverse effect on
        the
        Business or the financial condition or operations of Seller. Seller is qualified
        to do business as a foreign corporation in South Carolina.

       

      5.2  Authorization
        and Approval of Agreement.
        Seller
        has taken all corporate action necessary to authorize the execution and delivery
        of this Agreement and all agreements, instruments, or other documents executed
        in connection herewith (collectively with the Agreement, the “Transaction
        Documents”), and the consummation of the transactions contemplated hereby and
        thereby. All directors and the sole shareholder of Seller have been informed
        of,
        and consented to, the terms of the transactions contemplated hereby and thereby.
        Each of the representatives of Seller signing the Transaction Documents has
        full
        power and authority to execute the Transaction Documents on behalf of Seller
        in
        the indicated capacity and to consummate the transactions contemplated hereby
        and thereby. When executed and delivered by Seller, the Transaction Documents
        shall constitute valid and binding obligations of Seller enforceable in
        accordance with their terms and conditions, except to the extent such
        enforceability may be limited by (i) bankruptcy, insolvency,
        reorganization, moratorium or other similar laws, now or hereafter in effect,
        relating to or limiting creditors’ rights generally and (ii) general
        principles of equity. Neither the execution nor the delivery of the Transaction
        Documents nor the consummation of the transactions contemplated hereby or
        thereby, nor compliance with any of the terms and conditions hereof or thereof,
        will result in the breach by Seller of, or will conflict with, any of the
        terms,
        conditions or provisions of (a) the articles of incorporation, bylaws, or
        any
        other organizational constitutive instrument of Seller, or (b) any agreement,
        mortgage, order, judgment, permit, authorization, or instrument to which
        Seller
        is a party, or by which it is bound, or constitute a default of such articles
        of
        incorporation, bylaws, other organizational or constitutive instrument, or
        agreement, mortgage, order, judgment, permit, authorization, or
        instrument.

       

      
        
           

        

        
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      5.3  Compliance
        with Laws.
        Except
        as set forth in Schedule
        5.3,
        Seller
        is in material compliance with all laws, ordinances, and regulations that
        govern
        Seller’s ownership and use of the Assets, the Assumed Contracts and the Real
        Property and operation of the Business. Seller possesses and, except as
        described in Schedule
        5.3,
        is in
        material compliance with, all licenses, permits, certificates, approvals,
        and
        other authorizations which are required in connection with its ownership,
        occupancy, and use of the Assets, the Assumed Contracts, the Real Property,
        and
        the operation of the Business, other than those licenses, permits, certificates,
        approvals, and other authorizations the noncompliance with which would not
        be
        reasonably expected to have, either individually or in the aggregate, a material
        adverse effect on the Business. Except as set forth in Schedule
        5.3,
        no
        notice has been issued and, to the knowledge of Seller, no investigation
        or
        review is pending or threatened by any governmental entity (a) with respect
        to
        any alleged violation by Seller of any law, ordinance, regulation, order,
        policy, or guideline of any governmental entity with respect to the Assets,
        the
        Assumed Contracts, the Real Property, or the Business or (b) with respect
        to any
        alleged failure to possess, and to operate in accordance with, any permit,
        certificate, license, approval, or other authorization required in connection
        with ownership, occupancy, or use of the Assets, the Assumed Contracts or
        the
        Real Property, or the operation of the Business.

       

      5.4  Title
        to Properties.
        Seller
        has good and marketable title to the Assets as required in Section
        3.3,
        except
        for liens permitted therein. Based solely on Seller’s owner’s title insurance
        policies from Lawyers Title Insurance Corporation, to Seller’s actual knowledge,
        Seller has good, indefeasible, insurable (at standard title insurance rates),
        and marketable title to the Real Property, subject to the Permitted Exceptions.
        Except as set forth in Schedule
        5.4,
        Seller
        is not indebted to any contractor, laborer, mechanic, materialman, or any
        other
        person or entity for work, labor, materials, or services in connection with
        the
        Assets or the Real Property for which such person or entity could claim a
        lien
        on the Assets or the Real Property. Except as described in Schedule
        5.4,
        no
        officer, director, shareholder, or any relative of any such officer, director,
        or shareholder is a party to any material agreement with Seller relating
        to the
        Business or owns a material interest (except in the capacity as a director,
        shareholder, or employee) in any property, real, personal or mixed, tangible
        or
        intangible, which is used in the Business.

       

      5.5  Litigation.
        Except
        as described in Schedule
        5.5,
        no
        judicial, arbitration, administrative actions, or other legal proceedings
        are
        pending or, to Seller’s knowledge, threatened that question the validity of this
        Agreement or any transaction contemplated hereby or that relate to Seller
        with
        respect to the Business, the Assets, the Assumed Contracts or the Real Property,
        including but not limited to condemnation or bankruptcy proceedings. Except
        as
        described in Schedule
        5.5,
        no
        material judgment, decree, injunction, ruling, or order of any court,
        governmental department, commission, agent, instrumentality, or arbitrator
        is
        outstanding against Seller which relates to the Business, the Assets, the
        Assumed Contracts or the Real Property; and Seller is not bound by any material
        judgment, decree, injunction, ruling, or order of any court, governmental
        department, commission, agency, instrumentality, arbitrator, or any other
        person
        which relates to the Business, the Assets, the Assumed Contracts or the Real
        Property.

       

      
        
           

        

        
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      5.6  Consents.
        No
        consent of any third party or governmental entity is required in connection
        with
        Seller’s conveyance, transfer, and assignment of the Assets or the Assumed
        Contracts to Buyer and Real Property to Real Estate LLC hereunder, except
        as set
        forth in Schedule
        5.6;
        and to
        the extent so required, such consents shall be delivered by Seller to Buyer
        Parties at Closing.

       

      5.7  Normal
        Course.
        Except
        as set forth in Schedule 5.7,
        Seller
        has operated the Business, Assets, and Real Property in the normal and ordinary
        course of business since June 30, 2007 and has paid or caused to be paid
        promptly when due taxes, charges, and assessments imposed upon or assessed
        against the Assets prior to Closing. Except as set forth in Schedule 5.7,
        since
        June 30, 2007, Seller has exercised its commercially reasonable efforts to
        preserve the goodwill of the Business and Seller’s relationships with the
        employees, customers, suppliers, and others having business relationships
        with
        the Business through Closing. 

       

      5.8  Creditors,
        Solvency, and Bankruptcy.
        Seller
        has no intent to hinder, delay, defraud, or avoid any obligation to any past,
        present, or future creditor in the transactions contemplated by this Agreement.
        Seller is not insolvent as of Closing and will not be rendered insolvent
        as a
        result of the transactions contemplated hereby. Seller has not initiated
        nor
        does it intend to initiate with respect to itself as debtor, nor has it had
        initiated against it nor does it expect to have initiated against it as debtor,
        any proceeding under federal or any state’s bankruptcy, insolvency or similar
        laws. As a result of the transactions contemplated in this Agreement, Seller
        will not become unable to pay in full all of its debts as they fall due in
        the
        usual course of business.

       

      5.9  Labor
        and Employee Benefit Matters.
        Attached hereto as Schedule
        5.9(a)
        is a
        true and complete list as of the date hereof, showing the names of all employees
        of Seller, their periodic salary or hourly rate of compensation, their position
        entitling them to such compensation, and identification of any employment
        contract with such employee. Seller is not a party to any agreement with
        any
        labor organization, and has no obligation to provide advance notice of
        termination or the transactions contemplated herein, or pay severance, to
        any
        employee except as set forth in Schedule
        5.9(a).
        Except
        as described in Schedule
        5.9(b),
        Seller
        sponsors no employee benefit plan and has not incurred any accumulated funding
        deficiency within the meaning of ERISA or any liability to the Pension Benefit
        Guaranty Corporation established under such Act, nor has any tax been assessed
        against Seller for the alleged violation of the Internal Revenue Code with
        respect to the Business or its operations. Buyer Parties shall incur no
        liability whatsoever in connection with any employee benefit plan of Seller.
        Seller has complied with all continuation health care and similar requirements
        (i.e., COBRA) of the Code and ERISA with respect to all current and former
        employees of the Business. Seller has complied with all notice and other
        requirements of the Federal WARN Act or any similar state law, including
        without
        limitation S.C. Code Ann. §41-1-40, with respect to all current and former
        employees.

       

      
        
           

        

        
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      5.10  Workers’
        Compensation.
        No
        workers’ compensation or similar claims or actions are pending or threatened
        with respect to the Business, and Seller does not know of facts which would
        make
        such claims likely by past or present employees of Seller with respect to
        the
        Business, except for those claims listed on Schedule
        5.5
        for
        which Seller shall remain responsible. 

       

      5.11  Status
        of Assets.
        Except
        as set forth in Schedule 5.11,
        since
        July 28, 2007, (i) Seller has not removed or otherwise disposed of any
        assets from the Real Property (other than sales of inventory permitted pursuant
        to the LOI), and (ii) Seller has exercised commercially reasonable efforts
        to maintain and preserve the Assets in the ordinary course of business. Seller
        has not received any uncured citation, variance, or other notice to the effect
        that the facilities of the Business do not comply with applicable OSHA or
        other
        governmental laws or regulations.

       

      5.12  Assumed
        Contracts.
        All of
        the Assumed Contracts shall be lawfully transferred to Buyer hereunder, subject
        to consents described in Schedule
        5.6.
        There
        is no contest, claim, or right of set-off under the Assumed Contracts, other
        than rebates and returns in the ordinary course of business, except as set
        forth
        on Schedule
        5.12.
        All
        Assumed Contracts are valid, binding, enforceable in accordance with their
        terms, and without known default or violation of law; and no uncured default
        nor
        event exists which upon the passage of time or the giving of notice would
        constitute a default thereunder by any party thereto. None of the Assumed
        Contracts are with the federal government or any subdivision thereof and
        subject
        to Executive Order 11246 (1965) or any similar law, regulation, order, or
        standard relating to “affirmative action” or similar programs or requirements
        relating to procurement or sales practices.

       

      5.13  Taxes
        and Tax Returns.
        Seller
        has filed through the date hereof, and shall file for all periods through
        the
        date of Closing, all income, franchise, property, ad valorem, sales, payroll,
        withholding and other tax returns and other reports which they are required
        by
        law to file (collectively, the “Tax Returns”) and have paid or will pay all
        taxes which have become due pursuant to applicable law, to such Tax Returns,
        or
        to any assessment received by Seller (collectively, the “Taxes”). All such Tax
        Returns accurately reflect in all material respects the Taxes due and conform
        to
        applicable law. Seller has not received any notice of a proposed assessment
        of a
        Tax. The federal income tax returns of Seller have not been examined or audited
        by the Internal Revenue Service (the “IRS”) for any year since 1996. Seller has
        not (a) filed any consent or agreement under Section 341(f) of the Internal
        Revenue Code; (b) executed any waiver of statutes of limitation for federal
        income or other tax liability; (c) joined in the filing of consolidated returns
        for any year; or (d) been required to file a consolidated return in any
        year.

       

      5.14  Intellectual
        Property and Software.
        Seller
        owns or possesses adequate title, license, or other right to use all
        Intellectual Property and Software without interference with or infringement
        on
        the rights of others. All such Intellectual Property and Software are
        transferable by Seller and Seller will transfer such Intellectual Property
        and
        Software to Buyer in connection herewith. To Seller’s knowledge, no one is
        currently, or has at any time in the past, infringed or otherwise interfered
        with any of such Intellectual Property or Software transferred to Buyer
        hereunder.

       

      
        
           

        

        
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      5.15  Status
        of Inventory.
        Seller
        has no consignment inventory with respect to the Business or located at the
        Real
        Property.

       

      5.16  Environmental
        Matters.
        Except
        as described in Schedule
        5.16,
        with
        respect to Parcel A (as described on Schedule 1.4),
        or as
        set forth in the Phase I provided by Mactec dated August 23, 2007 (the “Phase
        I”), to the knowledge of Seller for all times prior to May 2, 2000, and
        without regard to the knowledge of Seller for all times on or after May 2,
        2000; and with respect to Parcel B (as described on Schedule 1.4),
        to the
        knowledge of Seller for all times prior to August 30, 1996, and without regard
        to the knowledge of Seller for all times on or after August 30, 1996, no
        conditions exist respecting Seller’s operations with respect to the Business,
        the Assets, or the Real Property: (a) which constitute an unlawful environmental
        condition; (b) which constitute a material violation of or require material
        remedial, investigative, monitoring, or other compliance activity pursuant
        to
        any environmental protection, antipollution, health, safety, nuisance, or
        related laws (whether common law, statutory law, ordinance, order, decree,
        rule,
        or regulation, including without limitation federal “SARA,” “RCRA,” “CERCLA,”
Hazardous Materials Transportation Act, Federal Water Pollution Control Act,
        Clean Air Act, Clean Water Act, Toxic Substance Control Act, or Safe Drinking
        Water Act, and amendments thereto); (c) which involve the use, production,
        or
        possession and/or the presence or occurrence at, or runoff, drainage, removal,
        emission, leaching, disposal, or release from Seller’s operations with respect
        to the Business, the Real Property, or Assets of hazardous or regulated sludge,
        industrial waste, ash, asbestos, PCBs, chemicals, chemical, fluid, or solid
        containers, air-borne particulate pollutants, gases, fumes, or any other
        hazardous, dangerous, or regulated substances or pollutants emitting from
        or
        relating to Seller’s operations with respect to the Business, the Real Property,
        or Assets, any of which are in material violation of applicable laws, rules,
        regulations, ordinances, orders, or decrees, require present or future (based
        upon current law) material remedial actions, or require the expenditure of
        material sums in order to comply with laws, rules, regulations, ordinances,
        orders, or decrees in the event of demolition or remodeling of existing
        facilities or improvements; or (d) which presently constitute, or can reasonably
        be expected to constitute in the foreseeable future, a “loss contingency” as
        defined by the Statement of Financial Accounting Standards No. 5 issued by
        the
        Financial Accounting Standards Board. Except as described in Schedule
        5.16,
        all
        wastes, refuse, debris, sludge, ash, chemicals, and other byproducts of Seller’s
        operations with respect to the Business, the Real Property, and Assets have
        been
        collected, removed, stored, handled, transported, and disposed of in material
        compliance with all applicable laws, rules, regulations, ordinances, orders,
        or
        decrees, and to Seller’s knowledge all landfills or other disposal sites
        accepting same were at the time of acceptance and are at the time of Closing
        properly licensed to accept, store, and dispose of same, and no such disposal
        site has been identified as a “Superfund” or “CERCLA” site or, to Seller’s
        knowledge, is subject to investigation by any regulatory authority. There
        are no
        underground storage tanks of any nature at the Real Property, and Seller
        has no
        knowledge that there ever were any underground storage tanks of any nature
        at
        the Real Property. The Real Property is not used as a waste disposal or
        hazardous substance storage site, and to Seller’s knowledge, the Real Property
        was never used as a waste disposal or hazardous substances storage site.
        For
        purposes of this Section
        5.16,
        violations, remedial actions, and other compliance activities shall be
“material”, and Seller’s compliance shall not be “material”, if the losses,
        damages, liabilities, penalties, assessments, costs, fines, obligations,
        or
        expenses (including litigation expenses and reasonable attorneys fees) arising
        out of or related to all such violations, remedial actions and other compliance
        activities, and Seller’s noncompliance, shall exceed $5,000 in the aggregate, or
        if any such violations, remedial actions and other compliance activities,
        or
        Seller’s noncompliance, shall result in the cessation, restriction, or other
        limitation of Seller’s continuing operations at the Real Property.

       

      
        
           

        

        
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      5.17  Real
        Property.

       

      (a)  There
        are
        no leases, tenancies, licenses or other rights of occupancy affecting the
        Real
        Property as of Closing, other than the lease agreement with the County of
        Edgefield, dated February 6, 1996.

      

      (b)  There
        are
        no executory contracts, agreements, service contracts, repair agreements
        and
        warranty and guaranty rights, with respect to the Real Property.

      

      (c)  There
        are
        no maintenance, management or other contracts or agreements affecting the
        Real
        Property except those which may be terminated without penalty on thirty (30)
        days notice or less, and Seller shall disclose and provide all contracts
        or
        agreements affecting the Real Property to the Real Estate LLC prior to
        Closing.

      

      (d)  No
        person, firm, corporation or other entity has any right or option to lease
        or to
        acquire the Real Property or any portion thereof.

      

      (e)  There
        is
        no pending condemnation or similar proceeding or assessment affecting the
        Real
        Property, or any part thereof, nor to the best knowledge and belief of Seller,
        is any such proceeding or assessment contemplated or threatened by any
        governmental authority.

      

      (f)  Seller
        has no knowledge, and has received no written notice, of any default or breach
        under any of the covenants, conditions, restrictions, rights-of-way or
        easements, if any, affecting the Real Property or any portion thereof which
        are
        to be performed or complied with by the owner of the Real Property.

      

      (g)  To
        Seller’s knowledge, no portion of the Real Property is affected by any special
        assessments, whether or not a lien thereon, and no such assessment has been
        proposed to Seller’s knowledge. To Seller’s knowledge, there is no proceeding
        pending for the reduction of the assessed valuation of any portion of the
        Property.

      

      (h)  All
        utility services necessary for the intended use of the Real Property (including
        without limitation, electric, gas, telephone, water and sewer service) are
        available to the Real Property, and Buyer Parties from and after the date
        of
        Closing will have the right to connect to and use all utility services without
        restriction, and all necessary easements to provide such utility services
        to the
        Real Property have been obtained.

      

      (i)  To
        Seller’s knowledge, the Real Property is currently zoned for Seller’s current
        use, is in compliance with applicable zoning laws and ordinances. Seller
        has no
        knowledge of the status of such zoning is in question or subject to adverse
        change by the appropriate governmental authorities.

      

      
        
           

        

        
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      (j)  From
        the
        date that Seller originally acquired the real property (the “Original Real
        Estate”) used in the operation of the Business and the date of this Agreement,
        Seller has not transferred, assigned, or otherwise conveyed any portion of
        such
        Original Real Estate to any other party.

      

      5.18  Pre-Closing
        Operations.
        (i)
        From July 28, 2007 until the date of Closing (the “Pre-Closing Period”), except
        for shipments (with notice to Buyer) of inventory to third-party customers
        of
        Seller with respect to the Business in the ordinary course of business to
        comply
        with the obligations of bona fide customer contracts entered into by Seller
        prior to July 28, 2007, Seller (x) ceased sales and deliveries of perennials
        and
        other saleable plants, (y) except as otherwise permitted in that certain
        Letter
        of Intent dated August 6, 2007, by and between Seller and Guarantor (the
“LOI”),
        did not transfer any such sales or inventories to other facilities of Seller,
        and (z) maintained and preserved all such inventories in the ordinary course
        of
        business; and (ii) Seller swept customer and other locations to collect and
        deliver to the Real Property prior to Closing not fewer than 5,000 racks.
        

       

      5.19  [RESERVED].
        

       

      5.20  Brokerage.
        The
        Seller has not dealt with a broker, investment banker, or financial consultant
        in connection with this transaction, and no brokerage commission or similar
        payment, nor claim therefor, shall accrue or become payable to any person
        or
        entity respecting this transaction as a result of Seller’s actions.

       

      5.21  Disclosures.
        To the
        knowledge of Seller, no representation or warranty of Seller contained in
        this
        Agreement or in any certificate furnished or to be furnished by or on behalf
        of
        Seller to Buyer Parties or their respective representatives in connection
        herewith or pursuant hereto, in each case as qualified in the disclosure
        schedules, contains or will contain any untrue statement of a material fact,
        or
        omits or will omit to state any material fact required to make the statements
        contained herein or therein not misleading.

       

      5.22  Knowledge.
        Notwithstanding anything to the contrary in this Agreement, all references
        contained in this Agreement, or contained in any certificate delivered or
        document executed by Seller and delivered pursuant to this Agreement, to
        the
        phrase “Seller’s knowledge” or “knowledge of Seller” or like expressions shall
        exclusively refer to the actual knowledge of Claudia Pieropan, Dave Kerr,
        Bill
        Bowers, and Hamp Holmes, and without any imputation of the knowledge of any
        other person or entity; provided, however, that the foregoing representations
        and warranties shall not in and of themselves create personal liability for
        such
        individuals.

       

      5.23  No
        Other Representations or Warranties.
        EXCEPT
        FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS SECTION 5 RELATING
        TO
        THE ASSETS, SELLER MAKES NO OTHER EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY
        WITH RESPECT TO THE ASSETS AND SELLER HEREBY DISCLAIMS ANY SUCH REPRESENTATION
        OR WARRANTY. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS
        SECTION
        5
        RELATING
        TO THE ASSETS, AND SELLER’S OBLIGATIONS IN THIS AGREEMENT WITH RESPECT TO THE
        RACKS SOLD TO BUYER HEREUNDER, THE ASSESTS ARE USED AND BEING SOLD “AS IS WHERE
        IS” AND THE SELLER HEREBY DISCLAIMS THE WARRANTY OF MERCHANTABILITY AND FITNESS
        FOR USE FOR A PARTICULAR PURPOSE.

       

      
        
           

        

        
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      6.    Representations
        and Warranties of Buyer Parties.
        Buyer
        Parties hereby represent and warrant to Seller as follows:

       

      6.1  Status
        and Standing of Buyer Parties.
        Each of
        Buyer Parties is a limited liability company, which is duly organized, validly
        existing, and in good standing under the laws of the State of South Carolina,
        and has all company power and authority to conduct its business as such business
        is now being conducted and is anticipated to be conducted as a result of
        this
        Agreement. 

       

      6.2  Authorization
        and Approval of Agreement.
        Each of
        Buyer Parties has taken all company action necessary to approve and authorize
        the execution and delivery of the Transaction Documents and consummation
        of the
        transactions contemplated hereby and thereby. Each of the representatives
        of
        Buyer Parties signing the Transaction Documents has full power and authority
        to
        execute the Transaction Documents in the indicated capacity and to consummate
        the transactions contemplated hereby and thereby. When executed and delivered
        by
        Buyer Parties, the Transaction Documents will constitute valid and binding
        obligations of Buyer Parties, enforceable in accordance with their terms
        and
        conditions. Neither the execution nor the delivery of the Transaction Documents
        nor the consummation of the transactions contemplated hereby or thereby,
        nor
        compliance with any of the terms and conditions hereof, will result in the
        breach by either of the Buyer Parties of, or will conflict with, any of the
        terms, conditions, or provisions of (a) either of the Buyer Parties’ articles of
        organization, operating agreement, or any other organizational or constitutive
        instrument, or (b) any agreement, order, judgment, permit, authorization,
        or
        instrument to which either of the Buyer Parties is a party, or by which either
        of them is bound, or constitute a default of such articles of organization,
        operating agreement, other organizational or constitutive instrument, agreement,
        order, judgment, permit, authorization, or instrument.

       

      6.3  Consents.
        No
        consent of any third party is required in connection with Buyer’s acquisition of
        the Assets or Real Estate LLC’s acquisition of the Real Property hereunder,
        except as set forth in Exhibit
        6.3;
        and to
        the extent so required, such consents shall be delivered by Buyer Parties
        to
        Seller at Closing, if any.

       

      6.4  Litigation.
        No
        judicial, arbitration, administrative actions, or other legal proceedings
        are
        pending or, to the best of Buyer Parties’ knowledge, threatened that question
        the validity of this Agreement or any transaction contemplated hereby, which
        if
        adversely determined would have a material adverse effect upon Buyer Party’s
        ability to enter into this Agreement or perform its obligations
        hereunder.

       

      6.5  Brokerage.
        Neither
        of the Buyer Parties has dealt with any broker, investment banker, or financial
        consultant in connection with this transaction, and no brokerage commission
        or
        similar payment, nor claim therefor, shall accrue or become payable to any
        person or entity respecting this transaction as a result of either of the
        Buyer
        Parties’ actions.

       

      
        
           

        

        
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      6.6  Buyer’s
        Independent Investigation.
        Buyer
        Parties acknowledge that they have exercised commercially reasonable efforts
        to
        conduct customary due diligence with respect to the Assets, the Assumed
        Contracts and the Real Property. Buyer Parties acknowledge the limitations
        on
        Seller’s representations and warranties set forth in Section 5.23.

       

      6.7  Bulk
        Transfer Laws.
        Buyer
        Parties hereby waive compliance by Seller with any applicable UCC bulk sale
        or
        bulk transfer laws of any jurisdiction in connection with the sale of the
        Assets, the Assumed Contracts or the Real Property. Pursuant to Section 8
        Seller
        has agreed to indemnify Buyer Parties against any and all liabilities which
        may
        be asserted by any third-party creditors against Buyer Parties as a result
        of
        Seller’s noncompliance with any such applicable law.

       

      7.    Cost
        and Expenses.

       

      7.1  Transactional
        Costs.
        Seller
        and Buyer shall be responsible for their respective attorneys’ fees,
        accountants’ fees, experts’ fees, investment banker and financial consultant
        fees (if any), and other expenses incurred by them in connection with the
        negotiations and Closing of this transaction; provided however that in the
        event
        litigation or arbitration is commenced to enforce any rights under this
        Agreement or to pursue any other remedy available to any party, all legal
        expenses or other direct costs of litigation or arbitration of the prevailing
        party shall be paid by the other party. Any environmental assessment, title
        examination, title insurance, or survey desired by Buyer Parties in connection
        with Closing shall be obtained at Buyer Parties’ expense, except as set forth in
Section
        3.4.7.

       

      7.2  Documentary
        Stamps.
        Seller
        shall pay all documentary stamp taxes, transfer taxes, or filing fees which
        become due through the execution, delivery and/or recordation of any instruments
        of conveyance required to be executed or delivered by Seller under this
        Agreement, which amounts, if any, shall be deducted from the proceeds due
        to
        Seller at Closing.

       

      7.3  Proration
        of Taxes and Charges.
        All
        real estate and personal property taxes, all public utility charges, rents
        and
        like charges (which are not terminated and paid as of Closing by Seller),
        if
        any, relating to the real and personal (tangible and intangible) property
        comprising the Assets, the Assumed Contracts and the Real Property shall
        be
        prorated on a per diem basis as of 11:59 p.m. on the date of Closing. If
        any such amounts have not been finally assessed or billed as of the date
        of
        Closing for the current period, then the same shall be adjusted at the Closing
        based upon the most recent bills therefor, and shall be re-adjusted when
        and if
        final bills are issued. If any bills for any such charges for periods prior
        to
        the Closing are not then available, then the parties shall make a reasonable
        estimate thereof for purposes of adjustments at the Closing, with such amounts
        to be re-adjusted between the parties within thirty (30) days of receipt
        of said
        bills.

       

      
        
           

        

        
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      7.4  Sales
        Taxes.
        Seller
        shall be responsible for, and shall pay, all sales, excise, or similar transfer
        taxes, if any, applicable to the sale of the Assets (including any vehicles)
        and
        Real Property as required herein.

       

      8.    Indemnity
        Rights.

       

      8.1  Indemnity
        Damages.
        For
        purposes hereof, the term “Indemnity Damages” shall mean all losses, damages,
        non-speculative lost profits, consequential and punitive damages, liabilities,
        claims, suits, demands, penalties, assessments, remedial costs, fines,
        obligations, causes of action, expenses, or costs (including litigation expenses
        and reasonable attorneys fees) with respect to which an indemnification right
        applies hereunder.

       

      8.2  Seller’s
        Indemnification.
        Seller
        shall indemnify and hold each of the Buyer Parties and their respective
        officers, members, managers, employees, and agents (the “Seller Indemnitees”)
        harmless from any and all Indemnity Damages asserted against or incurred
        by the
        Seller Indemnitee as a result of (a) any breach of any representation or
        warranty made by Seller in this Agreement, (b) any breach by Seller, unless
        waived by Buyer Parties, as applicable, of any covenant or agreement of Seller
        contained in or arising out of this Agreement, (c) any liability or obligation
        relating to, resulting from or arising out of the Business, the Assets, the
        Assumed Contracts or the Real Property before the time of the completion
        of
        Closing, including without limitation the matters discussed on Schedules
        5.4 and 5.5
        and in
        the Phase I, (d) any failure by Seller to comply with Seller’s obligations,
        if any, under the Worker Adjustment Retraining and Notification Act (WARN
        Act),
        (e) the Bulk Transfer provisions of the Uniform Commercial Code or similar
        law
        of any applicable jurisdiction relating in any way to this Agreement, or
        (f) any
        of the Excluded Assets, Excluded Liabilities, and/or Excluded
        Business.

       

      8.3  Buyer
        Parties’ Indemnification.
        Buyer
        Parties shall indemnify and hold Seller and its officers, shareholders,
        directors, managers, employees, and agents (the “Buyer Indemnitees”) harmless
        from any and all Indemnity Damages asserted against or incurred by the Buyer
        Indemnitee as a result of (a) any breach of any representation or warranty
        made by Buyer Parties in this Agreement, (b) any breach by Buyer Parties,
        unless waived by Seller, of any covenant or agreement of any Buyer Party
        contained in or arising out of this Agreement, or (c) any liability or
        obligation relating to, resulting from or arising out of the Assets, the
        Assumed
        Contracts or the Real Property on or after the time of the completion of
        Closing.

       

      8.4  Provisions
        of General Application.
        With
        respect to any right of indemnification arising under this Agreement, the
        following provisions shall apply:

       

      8.4.1  Procedures.
        The
        indemnified party and the indemnifying party agree to cooperate in the defense
        of any third party claim or action subject to this Section
        8
        to
        permit the cooperation and participation of the other parties in any such
        claim
        or action, and to promptly notify the other parties of the occurrence of
        any
        indemnified event or any material developments or amounts due respecting
        any
        indemnification event. All claims for indemnity hereunder shall be made in
        writing, and shall state with reasonable specificity the matter for which
        indemnification is sought.

       

      
        
           

        

        
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      8.4.2  No
        Implications.
        Neither
        the rights of any party to indemnification from another party nor the
        obligations of any party to indemnify another party, under this Agreement
        shall
        in any way imply or create, and each party specifically disclaims, any
        responsibility whatsoever by such party for any other party’s liabilities to any
        other person or entity or governmental body.

       

      8.4.3  Settlement.
        No
        settlement of an action covered by this Section
        8
        shall be
        made without the prior written consent of each party to this Agreement, which
        consent shall not be unreasonably withheld; provided however, that anything
        in
        this Agreement to the contrary notwithstanding, (a) if a reasonable probability
        exists that a claim may materially and adversely affect an indemnified party
        other than as a result of monetary damages or other money payments, the
        indemnified party shall have the right, at its own cost and expense, to
        compromise or settle such claim in any reasonable manner, and (b) the
        indemnifying party shall not, without prior written consent of the indemnified
        party, settle or compromise any claim or consent to the entry of any judgment
        which does not include as an unconditional term thereof the giving by the
        claimant or the plaintiff to the indemnified party a release from all liability
        in respect of such claim or which involves a remedy other than the payment
        of
        monetary damages. In any event, all parties hereto shall retain the right
        to
        participate in the prosecution and/or defense of any such actions; and the
        party
        prosecuting and/or defending such action shall act reasonably and in accordance
        with good business judgment giving due recognition to the interests of the
        other
        parties to this Agreement.

       

      8.5  Limitations.
        Anything contained in this Agreement to the contrary notwithstanding: (a)
        Seller
        shall not be liable for any claim for Indemnity Damages under Section
        8.2(a)
        asserted
        by the Seller Indemnitees after the eighteen (18) month anniversary of the
        date
        of Closing; provided however, that the Seller Indemnitees shall be entitled
        to
        pursue after such date any such claim that was properly asserted prior to
        such
        date; (b) Seller’s aggregate liability for such indemnification claims for a
        breach of a representation or warranty under Section
        8.2(a)
        shall
        not exceed Two Million and No/100 Dollars ($2,000,000.00); and (c) Seller
        shall
        not become liable for any Indemnity Damages under Section
        8.2(a)
        unless
        and until the aggregate of all such claims exceeds Fifteen Thousand and No/100
        Dollars ($15,000.00), but thereafter the indemnifying parties shall be liable
        to
        the full extent of such claims (including the first $15,000.00 of such claims)
        up to the amount limitation in Section
        8.5(b)
        above in
        the aggregate. The limitations of this Section
        8.5
        shall
        apply to all claims for indemnification under Section
        8.2(a)
        except:
        (x) claims arising out of Seller’s actual fraud; (y) a representation or
        warranty that Seller knew at the date of this Agreement was false; and (z)
        claims arising under Sections
        5.4, 5.5, 5.13, or 5.16.

       

      8.6  Exclusive
        Remedy.
        The
        indemnification remedies provided in this Section
        8
        shall be
        the exclusive remedies for monetary damages available to the parties following
        the Closing with respect to any claims under this Agreement including, without
        limitation, any claims for breach of any representation, warranty, covenant
        or
        agreement made by the parties in this Agreement, except for claims of fraud.
        Such limitations shall not impair the rights of any of the parties: to seek
        non-monetary equitable relief, including (without limitation) specific
        performance or injunctive relief to redress any default or breach of this
        Agreement or any bill of sale, assignment, other transfer document, assumption,
        consent, or other agreement to be delivered at Closing hereunder. 

       

      
        
           

        

        
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      8.7  Mitigation.
        In the
        event any party suffers any Indemnity Damages for which such party would
        be
        entitled to indemnification under Section 8, such party shall be obligated
        to
        use commercially reasonable efforts to mitigate the extent of any such Indemnity
        Damages. A party shall be responsible for that portion of any Indemnity Damages
        that results from such party’s failure to use commercially reasonable efforts to
        mitigate the extent of such Indemnity Damages.

       

      8.8  Insurance
        Coverage.
        The
        amount of any Indemnity Damages shall be reduced by any net amount actually
        received (after taking into account any cost or expenses (including without
        limitation attorneys’ fees) incurred in connection with obtaining such amounts,
        and adjusting for any increase in premiums resulting from such insurance
        claims)
        by a Buyer Indemnitee or Seller Indemnitee with respect thereto under any
        third
        party insurance coverage or from any other party alleged to be responsible
        therefor; provided however, that: (a) this Section shall not apply to the
        extent it conflicts with, is prohibited by, or would invalidate, any such
        insurance policy; (b) collection of such insurance proceeds or other
        amounts shall not be a condition precedent to asserting or collecting such
        indemnification; and (c) such insurance proceeds or other amounts shall not
        affect or be applied towards the maximum liability established in Section 8.5.
        If a
        Buyer Indemnitee or Seller Indemnitee makes a claim for indemnification under
        this Section 8,
        such
        Buyer Indemnitee or Seller Indemnitee shall use commercially reasonable efforts
        to collect any amounts available under such insurance coverage and from such
        other party alleged to have responsibility. If a Buyer Indemnitee or Seller
        Indemnitee receives an amount under insurance coverage or from such other
        party
        with respect to Indemnity Damages at any time subsequent to any indemnification
        provided pursuant to this Section 8,
        then
        such Buyer Indemnitee or Seller Indemnitee shall promptly reimburse Seller
        or
        Buyer Parties, as applicable, for any payment made or expense incurred by
        Seller
        or Buyer Parties, respectively, in connection with providing such
        indemnification up to such amount received by Buyer Indemnitee or Seller
        Indemnitee, but net of any costs and expenses (including without limitation
        attorneys’ fees) incurred by such Buyer Indemnitee or Seller Indemnitee in
        collecting such amount, and adjusting for any increase in premiums resulting
        from any such insurance claims.

       

      8.9  Tax
        Benefits.
        Any
        indemnity amounts payable to or on behalf of a Buyer Indemnitee or Seller
        Indemnitee pursuant to this Agreement shall be reduced by the net present
        value
        of any realizable, actual tax benefit arising from the claim, loss or damage
        for
        which the indemnity is being paid, including any increase in deductions,
        credits
        or losses of Buyer Indemnitee or Seller Indemnitee (or any respective
        affiliate). The net present value of such tax benefit shall be calculated
        using
        a discount rate equal to the mid-term applicable federal rate in effect on
        the
        day on which the indemnification payments are due, and the combined marginal
        tax
        rate for applicable U.S. federal, foreign, state and local income taxes for
        the
        Buyer Indemnitee or Seller Indemnitee (or its respective affiliate, as the
        case
        may be), as applicable.

       

      9.    [RESERVED].
        

       

      
        
           

        

        
          21

          
            

          

        

        
           

        

         

      

      10.         
        Miscellaneous.

       

      10.1  Entire
        Agreement.
        This
        Agreement, including the Exhibits and Schedules attached hereto (which are
        incorporated herein by reference and expressly made a part hereof), embodies
        the
        entire Agreement and understanding between the Parties hereto as to the matters
        herein addressed and supersedes all prior agreements and understandings relating
        to the subject matter hereof, including without limitation the LOI.

       

      10.2  No
        Waiver.
        No
        failure to exercise and no delay in exercising any right, power, or remedy
        hereunder or under any document delivered pursuant hereto shall impair any
        right, power or remedy which the parties hereto may have, nor shall any such
        delay be construed to be a waiver of any of such rights, powers, or remedies,
        or
        an acquiescence in any breach or default under this Agreement, nor shall
        any
        waiver of any breach or default of any party hereunder be deemed a wavier
        of any
        default or breach subsequently occurring.

       

      10.3  Amendment.
        No
        provision of this Agreement or any document or instrument relating to the
        Agreement may be amended, modified, supplemented, changed, waived, discharged,
        or terminated unless the parties hereto consent thereto in writing.

       

      10.4  Notices.
        All
        notices, requests, approvals, consents, demands and other communication provided
        for or permitted hereunder shall be in writing, signed by an authorized
        representative of the sender and addressed to the respective party at the
        address set forth below:

       

      
        	Buyer, Real Estate LLC, and
                Guarantor: 	Layman Wholesale Nurseries,
                Inc. 
	 	73 Green House Road 
	 	Trenton, South Carolina
                29847 
	 	ATTN: Barrett W. Layman,
                Sr. 
	 	 
	Copy To: 	NEXSEN PRUET, LLC 
	 	1230 Main Street, Suite
                700 
	 	Post Office Drawer 2426 
	 	Columbia, South Carolina
                29202 
	 	ATTN: G. Marcus Knight,
                Esquire 
	 	 
	Seller 	Hines Horticulture, Inc. 
	 	12621 Jeffrey Road 
	 	Irvine, California 92620 
	 	ATTN: Claudia Pieropan 
	 	Chief Financial Officer 
	 	 
	Copy To: 	Paul, Hastings, Janofsky & Walker
                LLP 
	 	695 Towne Center Drive 
	 	17th
                Floor 
	 	Costa Mesa, California
                92626 
	 	ATTN: Stephen D. Cooke,
                Esquire 

      

       

      A
        party
        hereto may change its respective address by notice in writing given to the
        other
        parties to this Agreement. Any notice, request, approval, consent, demand,
        or
        other communication shall be effective upon the first to occur of the following:
        (i) when delivered to the party to whom such notice, request, approval, consent,
        demand, or other communication is being given, or (ii) three (3) business
        days
        after being duly deposited in the U.S. mail, certified, return receipt
        requested, to the address set forth above.

       

      
        
           

        

        
          22

          
            

          

        

        
           

        

         

      

      10.5  Severability
        of Provisions.
        In case
        any one or more of the provisions contained in this Agreement should be invalid,
        illegal, or unenforceable in any respect, the validity, legality, and
        enforceability of the remaining provisions contained herein shall not in
        any way
        be affected or impaired thereby.

       

      10.6  Successors
        and Assigns.
        This
        Agreement shall be binding upon the parties and their respective successors
        and
        assigns and shall inure to the benefit of the parties and their respective
        successors and permitted assigns. This Agreement and the rights and obligations
        hereunder shall not be assignable by any party without the written consent
        of
        the other parties hereto, and any such purported assignment by any party
        without
        such consent shall be void; provided, however, that the assignment of any
        rights
        or duties under this Agreement by one or both of Buyer Parties to Layman
        Wholesale Nurseries, Inc. or any entity that is controlled, directly or
        indirectly, by Barrett W. Layman, Sr., shall not require the consent of
        Seller.

       

      10.7  Counterparts.
        This
        Agreement may be executed in any number of counterparts, all of which taken
        together shall constitute one Agreement, and any party hereto may execute
        this
        Agreement by signing any such counterpart. The authorized attachment of
        counterpart signature pages shall constitute execution by the
        parties.

       

      10.8  Choice
        of Law.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of South Carolina.

       

      10.9  Arbitration.
        The
        parties hereto consent to jurisdiction, subject to proper service of process,
        regarding any disputes arising hereunder in the federal or state courts for
        South Carolina; provided however, that the following shall apply: If a dispute,
        controversy or claim (whether based upon contract, tort, statute, common
        law, or
        otherwise) (collectively a “Dispute”) arises from or relates directly or
        indirectly to the subject matter hereof, and if the Dispute cannot be settled
        within fifteen (15) calendar days through direct discussions between the
        parties, any unresolved Dispute thereafter shall be settled by binding
        arbitration conducted in accordance with the Commercial Arbitration Rules
        (the
“Rules”) of the American Arbitration Association (the “AAA”) and judgment on the
        award rendered by the arbitrator, after the review rights set forth below
        (if
        any) have been exhausted, may be entered in any court having jurisdiction
        as set
        forth above; provided however, that unless otherwise agreed as set forth
        below,
        the arbitration shall not be administered by the AAA; and provided further
        however, that if the underlying claim involves a third party as a necessary
        party to such proceedings, and such third party is not obligated, or does
        not
        agree, to arbitration hereunder, then the parties shall be entitled to resolve
        the Dispute in such forum as is appropriate to include such third party in
        the
        proceedings, and the parties hereto shall waive their respective rights to
        demand arbitration of the Dispute as set forth herein. The arbitration
        proceedings shall be conducted in Columbia, South Carolina on an expedited
        basis
        before a neutral arbitrator (or three arbitrators if the Rules call for multiple
        arbitrators). Each arbitrator shall be an attorney with excellent academic
        and
        professional credentials, who (i) is an active or retired member of the Bar
        of
        the State of South Carolina, (ii) has been actively engaged in the practice
        of
        corporate and commercial law (including mergers and acquisitions) in South
        Carolina for at least fifteen (15) years, (iii) has substantial experience
        in
        the subject matter of this Agreement, and (iv) has no attorney-client, familial,
        or pecuniary relationship

       

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

       

       to
        the parties; provided however, that such arbitrator is not required to be
        listed
        by AAA as an approved arbitrator. If the Rules call for three arbitrators,
        each
        of the parties shall within twenty (20) days after institution of the
        arbitration designate one arbitrator and the two designated arbitrators shall
        jointly designate the third arbitrator. If the Rules call for one arbitrator,
        each of the parties shall designate one arbitrator and the two designated
        arbitrators shall not serve but shall jointly designate a third arbitrator
        who
        shall serve as the single arbitrator. If in either case the two arbitrators
        designated by the parties are unable to designate the third arbitrator within
        ten (10) days, the third arbitrator shall be designated by the chief
        administrative judge for Richland County, South Carolina Circuit Court upon
        request made by either party after the expiration of such ten-day period.
        Any
        attorney who serves as an arbitrator shall be compensated at a rate equal
        to his
        or her current regular hourly billing rate if he or she is currently practicing,
        and a reasonable hourly rate if not currently practicing. Unless otherwise
        ordered by the arbitrators, pre-hearing discovery in the arbitration proceeding
        shall be restricted to the following: (a) three depositions by each party
        (plus
        one additional deposition by each party for each expert witness used by the
        other party); (b) two submissions of written interrogatories by each party
        not
        to exceed fifty total interrogatories, including subparts; (c) two requests
        for
        production of documents by each party; (d) two submissions of requests to
        admit
        by each party not to exceed thirty total requests to admit; and (e) such
        similar
        discovery respecting any third party which is a party to the proceeding (for
        purposes of such limitations on discovery, all of the Buyer Parties and
        Guarantor shall be deemed one party). All such pre-hearing discovery must
        be
        completed within one hundred twenty (120) days after the appointment of the
        arbitrators, unless otherwise ordered by the arbitrators. All hearings conducted
        by the arbitration panel shall be recorded by a court report for purposes
        of
        preparing a transcript, but a transcript will not be prepared unless requested
        by a party for purposes of a review panel as described below. Upon the request
        of either party, the arbitrator’s award shall include findings of fact and
        conclusions of law, provided that such findings may be in summary form. In
        the
        event that the arbitrator’s award involves the award or denial of monetary
        damages exceeding $250,000 or relief other than monetary damages, then either
        party may seek expedited review of the arbitrator ’s award before an arbitration
        review panel comprised of three arbitrators selected and qualified in the
        same
        manner as the initial arbitrator(s) (as set forth above) by submitting a
        written
        request to the initial arbitrators and the other party. The right of review
        shall be deemed waived unless requested in writing within five (5) days of
        the
        receipt by the party seeking review of the initial arbitrator’s award. The
        arbitration review panel shall be entitled to review all findings of fact
        and
        conclusions of law in whatever manner it deems appropriate (but such review
        will
        not include a de novo factual hearing) and may modify the award of the initial
        arbitrator(s) in its discretion, and must be completed within one hundred
        twenty
        (120) days after the review is requested. The prevailing party in any
        arbitration proceeding shall be entitled to an award of all reasonable
        out-of-pocket costs and expenses (including attorneys’ and arbitrators’ fees)
        related to the entire arbitration proceeding (including review if applicable).
        Upon request of either party, the arbitrator(s) may require that the subject
        arbitration proceedings be kept confidential and no party shall disclose
        or
        permit the disclosure of any information produced or disclosed in the
        arbitration proceedings until the award is final. If recommended by the initial
        or review arbitrators, the parties shall designate an organization (but not
        AAA
        unless both parties agree) to administer the arbitration in the manner that
        the
        AAA would administer the arbitration, and if the parties do not agree on
        the
        designation of an organization within ten (10) days the arbitrators shall
        designate the organization (but not AAA). A party shall not be prevented
        from
        seeking temporary injunctive relief before a court of competent jurisdiction
        in
        an emergency or other exigent situation, but responsibility for resolution
        of
        the Dispute shall be appropriately transferred to the arbitrator(s) upon
        appointment in accordance with the provisions hereof.

       

      
        
           

        

        
          24

          
            

          

        

        
           

        

         

      

      10.10  Usage.
        The
        section and paragraph headings contained in this Agreement are for reference
        purposes only and shall not affect in any way the meaning or interpretation
        of
        this Agreement. Terms such as “hereof,” “hereunder,” “hereto,” “herein,”
“above”, “below”, and words of similar import shall refer to this Agreement in
        its entirety; and all references to “Articles,” “Paragraphs,” “Sections,”
“Exhibits,” and “Schedules,” and similar cross references shall refer to
        specified portions of this Agreement unless the context clearly requires
        otherwise.

       

      10.11  Further
        Instruments and Acts.
        From
        time to time at a party’s request, whether at or after Closing and without
        further consideration, the other party(ies) shall execute and deliver such
        further instruments of conveyance, transfer, and assignment and upon
        reimbursement for actual reasonable out-of-pocket expenses take such other
        action as the requesting party reasonably may require to more effectively
        convey
        and transfer to the requesting party the properties to be conveyed, transferred,
        and assigned hereunder, and, if necessary, will assist the requesting party
        in
        the collection or reduction to possession of such property. In addition,
        each
        party agrees to reasonably cooperate in resolving any matters resulting from
        the
        transactions contemplated hereby.

       

      10.12  Remedies.
        Upon
        any breach or other violation of this Agreement, the parties hereto shall
        be
        entitled to exercise any and all rights and remedies contained herein or
        now or
        hereinafter existing and available at law, in equity, by statute, or otherwise.
        No right or remedy herein conferred upon a party is intended to be exclusive
        of
        any other right or remedy contained herein; and every such right or remedy
        shall
        be cumulative and shall be in addition to every other right or remedy contained
        herein or now or hereafter existing and available at law, in equity, by statute,
        or otherwise. In connection with the seeking of any non-monetary equitable
        relief, each of the parties acknowledges and agrees that the other parties
        hereto would be damaged irreparably in the event any of the provisions of
        this
        Agreement are not performed in accordance with their specific terms or otherwise
        are breached. Accordingly, each of the parties hereto agrees the other parties
        hereto shall be entitled to an injunction or injunctions to prevent breaches
        of
        the provisions of this Agreement and to enforce specifically this Agreement
        and
        the terms and provisions hereof in any competent court having jurisdiction
        over
        the parties (subject to the provisions of Section 10.9
        above).

       

      [SIGNATURE
        PAGE ATTACHED]

      

      
        
           

        

        
          25

          
            

          

        

        
           

        

         

      

      IN
        WITNESS WHEREOF, the parties have executed and delivered this Asset Purchase
        Agreement on or about August 29, 2007, to be legally binding and effective
        as of
        the date first above written.

       

      
        
          	 	BUYER: 
	 	 
	 	Palmetto Perennials, LLC 
	 	 
	 	By:  /s/
                  Barrett W. Layman, Sr.  
	 	       Barrett
                  W. Layman, Sr. 
	 	       Manager
                  and President 
	 	 
	 	REAL ESTATE LLC: 
	 	 
	 	Layman Holdings, LLC 
	 	 
	 	By:  /s/
                  Barrett W. Layman, Sr.  
	 	       Barrett
                  W. Layman, Sr. 
	 	       Manager
                  and President  
	 	 
	 	SELLER: 
	 	 
	 	Hines Nurseries, Inc. 
	 	 
	 	By:  /s/
                  Claudia
                  Pieropan          
                   
	 	       Claudia
                  Pieropan 
	 	       Chief
                  Financial Officer 

        

    

     

     

    26Exhibit 4.1

 

	
  NUMBER

  	
   

  	
   

  	
  UNITS

  	
   

  
	
  U

  	
   

  	
   

  	
   

  	
   

  
	
  SEE REVERSE FOR CERTAIN DEFINITIONS

  	
   

  	
   

  	
  CUSIP 429086 40 8

  	
   

  

 

HICKS ACQUISITION COMPANY I, INC.

 

UNITS CONSISTING OF ONE SHARE OF COMMON STOCK AND ONE
WARRANT TO PURCHASE ONE SHARE OF COMMON STOCK

 

	
  This Certifies that 

  	
   

  

 

	
  is the owner of 

  	
   

  	
   Units

  

 

Each Unit (“Unit”)
consists of one (1) share of common stock, par value $0.0001 per share (“Common
Stock”), of Hicks Acquisition Company I, Inc., a Delaware corporation (the “Company”),
and one warrant (the “Warrants”). Each Warrant entitles the holder to purchase
one (1) share of Common Stock for $7.50 per share (subject to adjustment). Each
Warrant will become exercisable on the later of (i) the Company’s completion of
a merger, capital stock exchange, asset acquisition or other similar business
combination and (ii)               ,
and will expire unless exercised
before 5:00 p.m., New York City Time, on          ,
      , or earlier upon redemption (the “Expiration
Date”). The Common Stock and Warrants comprising the Units represented by this certificate are not transferable
separately prior to            ,
2007, unless Citigroup Global Markets Inc. elects to allow separate trading
earlier, subject to the Company’s filing of a Current Report on Form 8-K with the Securities and Exchange Commission
containing an audited balance sheet reflecting the Company’s receipt of the
gross proceeds of the offering and issuing a press release announcing when separate
trading will begin. The terms of the
Warrants are governed by a Warrant Agreement, dated as of          ,
      , between the Company and Continental Stock
Transfer & Trust Company, as Warrant Agent, and are subject to the terms and provisions contained
therein, all of which terms and provisions the holder of this certificate consents
to by acceptance hereof. Copies of the Warrant Agreement are on file at the
office of the Warrant Agent at 17 Battery Place, New York, New York 10004, and
are available to any Warrant holder on written request and without cost.

 

This certificate
is not valid unless countersigned by the Transfer Agent and Registrar of the
Company.

 

Witness the
facsimile seal of the Company and the facsimile signature of its duly
authorized officers.

 

	
   

  	
   

  	
  [Corporate Seal]

  	
   

  	
   

  
	
  Secretary

  	
   

  	
  Delaware

  	
   

  	
  President

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 

Hicks Acquisition Company I, Inc.

 

The Corporation will furnish without charge to each stockholder who so
requests, a statement of the powers, designations, preferences and relative,
participating, optional or other special rights of each class of stock or series
thereof of the Corporation and the qualifications, limitations, or restrictions
of such preferences and/or rights.

 

The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

 

	
  TEN COM

  	
  –

  	
  as tenants in common

  	
   

  	
  UNIF GIFT MIN
  ACT– 

  	
   

  	
  Custodian 

  	
   

  
	
  TEN ENT

  	
  –

  	
  as tenants by the entireties

  	
   

  	
   

  	
  (Cust)

  	
   

  	
  (Minor)

  
	
  JT TEN

  	
  –

  	
  as joint tenants with right of survivorship 

  	
   

  	
   

  	
  under Uniform Gifts to Minors

  
	
   

  	
   

  	
  and not as tenants in common 

  	
   

  	
   

  	
  Act

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (State)

  
									

 

Additional abbreviations may
also be used though not in the above list.

 

 

	
            For value received, 

  	
   

  	
   hereby sell, assign and transfer unto 

  	
   

  

 

	
  PLEASE
  INSERT SOCIAL SECURITY OR OTHER

  IDENTIFYING NUMBER OF ASSIGNEE

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (PLEASE PRINT OR TYPEWRITE
  NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

  

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   Units

  

 

	
  represented
  by the within Certificate, and do hereby irrevocably constitute and appoint

  	
   

  
	
   

  	
   Attorney

  

to transfer
the said Units on the books of the within named Corporation with full power of
substitution in the premises.

 

Dated                                                       

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notice: 

  	
  The signature to this
  assignment must correspond with the name as written upon the face of the
  certificate in every particular, without alteration or enlargement or any
  change whatever.

  
	
  Signature(s) Guaranteed:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  THE SIGNATURE(S) MUST BE
  GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS
  AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
  SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15).

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