Document:

Exhibit 10.1

                           PURCHASE AND SALE AGREEMENT
                                 (EAGAN SCHOOL)

     This PURCHASE AND SALE  AGREEMENT (the  "Agreement")  is entered into as of
this 28th day of March,  2001,  by and  between THE  TESSERACT  GROUP,  INC.,  a
Minnesota  corporation,  in its corporate capacity and in its capacity as debtor
and  debtor-in-possession  in its Chapter 11 case  pending in the United  States
Bankruptcy Court for the District of Arizona ("Seller"), and TESSERACT OF EAGAN,
INC., a Minnesota non-profit corporation ("Buyer").

                                    RECITALS

     A. Seller operates that certain private school commonly known as the "Eagan
TesseracT School" located at 3800 TesseracT Place,  Eagan,  Minnesota 55122 (the
"School").

     B. Seller has filed a voluntary  petition for Chapter 11 relief under Title
11 of the United States Code  ("Bankruptcy  Code"),  which is pending before the
United States Bankruptcy Court for the District of Arizona (the "Court").

     C. Seller desires,  subject to the approval of the Court, to sell and Buyer
desires to purchase  certain assets and assume certain  liabilities of Seller in
connection  with Seller's  operations of the School on the terms and  conditions
set forth in this Agreement and in accordance with Bankruptcy Code ss.ss.363 and
365.

     D.  Buyer  shall  complete  its due  diligence  of the School and all other
matters  addressed in this  Agreement by no later than the Initial  Hearing Date
(as defined in SECTION 1.10).

     E. Prior to or  contemporaneously  with the  closing  of this  transaction,
Buyer intends on  purchasing  the real property on which the School is situated,
and the related improvements and fixtures from EPI (defined below).

     F.  The  parties  hereto   acknowledge  that:  (i)  they  intend  that  the
transaction  contemplated  under this  Agreement be an asset  purchase and not a
sale of the stock of Seller; and (ii) Buyer is not buying the Business of Seller
as defined in this Agreement.

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:

                                   ARTICLE I.

                                   DEFINITIONS

     For purposes of this Agreement,  the following capitalized terms, when used
in this Agreement, shall have the meanings assigned to them as follows:
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     1.1 ASSUMED CONTRACTS. The term "Assumed Contracts" shall mean all Teaching
Contracts (as defined in SECTION 1.16),  which Buyer will assume hereunder,  and
all other  contracts,  if any, which are  specifically set forth on Schedule 1.1
attached hereto.

     1.2 BUSINESS.  The term "Business" shall mean Seller's operations conducted
under the name  "TesseracT,"  "The TesseracT Group,  Inc.," or " Eagan TesseracT
School," at the School.

     1.3 CLAIM.  The term "Claim" shall be given the same meaning as provided to
such term under Bankruptcy Code ss. 101(5).

     1.4 CLOSING.  The term "Closing" shall mean the completed  exchange of: (i)
Closing  documents  set forth in  Articles XV and XVI below,  together  with the
simultaneous  conveyance  by Seller to Buyer of the Purchased  Assets;  (ii) the
payments  between  Buyer and Seller due under the terms of this  Agreement;  and
(iii) the assumption by Buyer of the obligations  which it has expressly  agreed
to assume hereunder.

     1.5 DELINQUENT  REAL PROPERTY  TAXES.  The term  "Delinquent  Real Property
Taxes" shall mean those real property taxes that are classified as delinquent by
the applicable governmental authorities.

     1.6 CLOSING DATE.  The term "Closing Date" shall mean the date on which the
Closing occurs which shall not be later than March 30, 2001, unless such date is
extended in accordance with SECTION 11.1.

     1.7 EAGAN PROPERTY. The term " Eagan Property" shall mean that certain real
property  located in Eagan,  Minnesota,  at which  Seller  operates  the charter
school commonly referred to as the " Eagan TesseracT School".

     1.8 EPI. The term "EPI" shall mean Education  Property  Investors,  Inc., a
Nevada corporation.

     1.9 EQUIPMENT.  The term  "Equipment"  shall mean all furniture,  fixtures,
office  equipment,  computers,  printers,  and other tangible  personal property
owned by Seller and located at the School as  evidenced by Schedule 1.9 attached
hereto, the inventory list prepared by Seller.

     1.10 INITIAL  HEARING DATE. The "Initial  Hearing Date" shall mean the date
the Court conducts its initial  hearing on the Motion to approve the sale of the
Purchased Assets (as defined in SECTION 2.1).

     1.11 LEASE. The term "Lease" shall mean that certain Lease dated as of June
9, 1998 by and between Seller, as lessee, and EPI, as lessor,  pursuant to which
Seller leases the Real Property and the Eagan Property from EPI.

     1.12 REAL PROPERTY  PURCHASE  AGREEMENT.  The term "Real Property  Purchase
Agreement" shall mean the written  agreement between Buyer and EPI that provides
for EPI's sale, and Buyer's purchase, of the Real Property.

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     1.13 REAL PROPERTY.  The term "Real  Property" shall mean the real property
that is the subject of the Real Property Purchase  Agreement,  which is commonly
known as 3800 TesseracT Place, Eagan, Minnesota.

     1.14 SECTION 363 ORDER.  The term  "Section 363 Order" shall mean the order
entered by the Court pursuant to Bankruptcy Code ss.363 approving  Seller's sale
of the  Purchased  Assets (as  defined  in SECTION  2.1 below) to Buyer free and
clear  of any and all  liens,  encumbrances,  claims,  security  interests,  and
adverse  interests  of any  kind,  the form of which  shall be  agreed to by the
parties hereto.

     1.15 SECTION 365 ORDER.  The term  "Section 365 Order" shall mean the Order
entered by the Court pursuant to Bankruptcy  Code ss.365(a)  approving  Seller's
decision to: (i) reject the Lease;  and (ii) assume the Assumed  Contracts,  the
form of which shall be agreed to by the parties hereto.

     1.16  TEACHERS'   ACCRUED   LIABILITIES.   The  term   "Teachers'   Accrued
Liabilities"  shall  mean the  liabilities  of Seller for  accrued  compensation
arising under Seller's  employment  obligations  with the teachers at the School
(the "Teaching  Contracts"),  as of the Closing Date, which are specifically set
forth on Schedule 1.16 attached hereto and totals approximately $86,517.65.  The
Teachers' Accrued  Liabilities  amounts set forth on Schedule 1.16 are effective
as of March 30, 2001, and the parties will agree to an amended  Schedule 1.16 at
the Closing  which shall set forth the actual  amount of the  Teachers'  Accrued
Liabilities on the Closing Date.

                                   ARTICLE II.

                                PURCHASE AND SALE

     2.1  ASSETS  TO BE  SOLD.  Subject  to the  terms  and  conditions  of this
Agreement,  on the Closing  Date,  Seller agrees to sell,  assign,  transfer and
convey,  free and clear of any and all  liens,  encumbrances,  claims,  security
interests,  and  adverse  interests  of any  kind,  other  than as set  forth on
Schedule 2.1, the following assets and intangibles to Buyer  (collectively,  the
"Purchased Assets"), which the Buyer may use to operate a school:

          2.1.1  EQUIPMENT  AND THE ASSUMED  CONTRACTS.  The  Equipment  and the
Assumed Contracts.

          2.1.2 OTHER PERSONAL PROPERTY. In addition to the Equipment, except as
specifically  excluded  pursuant  to Section 2.2 of the  Agreement,  any and all
other tangible and intangible property utilized by Seller in connection with the
Business  conducted at the School facility,  including,  but not limited to, all
security and utility deposits, supplies-on-hand and the 1996 Ford E 350 Van.

          2.1.3 RECORDS. FILES AND RELATED MATERIALS. Subject to confidentiality
requirements  under  state  and  federal  laws,  copies of all  records,  files,
invoices,  student lists, employee files, accounting records,  business records,
operating information, any available historical financial data and other data of
Seller relating to the School.

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          2.1.4 GOODWILL. All of Seller's goodwill that relates to the School.

     2.2 EXCLUDED ASSETS.  Notwithstanding  SECTION 2.1 above,  Seller shall not
sell, transfer,  assign,  convey or deliver to Buyer, any asset not specifically
addressed  in SECTION  2.1 above,  including  but not  limited to the  following
assets (collectively the "Excluded Assets"):

          2.2.1  CONSIDERATION.  The consideration  delivered by Buyer to Seller
pursuant to this Agreement.

          2.2.2 INTELLECTUAL PROPERTY. Subject to SECTION 8.2 of this Agreement,
all  intellectual  property of Seller,  including,  but not limited to, Sellers'
trademarks, trade names, curriculum, and trade secrets.

          2.2.3  INSURANCE  POLICIES.  Seller's  insurance  policies  and rights
thereunder,  including,  but not  limited to,  general  liability  and  workers'
compensation insurance held by Seller.

          2.2.4 CORPORATE FRANCHISE. Seller's franchise to be a corporation, its
certificate of  incorporation,  corporate  seal,  stock books,  minute books and
other corporate records having exclusively to do with the corporate organization
and capitalization of Seller.

          2.2.5 CASH OR CASH  EQUIVALENTS.  Other  than  deposits  addressed  in
SECTION  2.1.2,  Seller's  accounts  receivable,  cash or cash  equivalents  are
Excluded Assets to this Purchase Agreement.

                                  ARTICLE III.

                            ASSUMPTION OF LIABILITIES

     3.1 ASSUMED LIABILITIES.  At Closing, Seller shall assume, cure and assign,
and Buyer shall accept said assignment (collectively, the "Assumed Liabilities")
of the  Assumed  Contracts;  provided,  however,  that  Buyer  shall,  with  the
exception of the  $86,517.65  due under the  Teaching  Contracts as described in
SECTION 1.8 of this  Agreement and subject to  adjustment as set forth  therein,
only be obligated to pay, perform,  or discharge in accordance with their, terms
such   obligations   thereunder  that  arise  on  or  after  the  Closing  Date.
Additionally,  at Closing Seller shall assume and assign, and Buyer shall accept
said  assignment of: (i) the Delinquent  Real Property Taxes pursuant to Section
8.6; and (ii) the Mechanic's Lien pursuant to Section 8.7. Buyer shall fully and
faithfully  perform all duties and obligations,  due or owing after Closing,  of
Seller with respect to the Assumed Liabilities.

     3.2 NO  ASSUMPTION OF OTHER  LIABILITIES.  Except as expressly set forth in
this Agreement,  Buyer does not by this Agreement, and will not be obligated to,
assume  any  obligation,  liability  or  duty  of  Seller  whether  incurred  in
connection  with  the  Purchased  Assets,  or  otherwise,   including,   without
limitation,  any obligation or liability of Seller  relating to, arising from or
in  connection  with any  tort  claims  made by a third  party  relating  to the
Business.

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                                   ARTICLE IV.

                                TERMS OF PAYMENT

     4.1 PAYMENT DUE AT CLOSING. At Closing, Buyer shall pay to Seller an amount
equal to Thirty Thousand and No/100 Dollars  ($30,000.00) less the amount of the
Deposit  delivered by Buyer to Seller in accordance  with SECTION 4.2 below,  in
immediately  available funds. In addition,  at Closing Seller shall pay to Buyer
an amount  equal to One  Hundred  Thousand  Dollars  ($100,000.00)  for  Buyer's
assumption of the Assumed  Liabilities and the Teachers' Accrued  Liabilities in
immediately   available  funds.  Buyer's  payment  and  Seller's  payment  shall
collectively be referred to as the "Purchase Price".

     4.2 DEPOSIT.  Contemporaneously with the execution of this Agreement, Buyer
shall  deliver to Seller a cash deposit in the amount of Ten Thousand and No/100
Dollars  ($10,000.00)  (the  "Deposit").  Prior  to the  expiration  of the  Due
Diligence  Period,  the Deposit shall be refundable to Buyer as provided herein.
Upon the  expiration  of the Due  Diligence  Period,  the Deposit  shall  become
non-refundable except in the event that a condition precedent of Buyer's duty to
close  pursuant to SECTIONS 13.1 THROUGH 13.4 or SECTION 13.6 has not been fully
and  completely  satisfied  as of the  Closing.  In the  event  the  sale of the
Purchase Assets as contemplated  hereunder is consummated,  the Deposit shall be
delivered to Seller at the Closing and credited against the Purchase Price.

                                   ARTICLE V.

                                  DUE DILIGENCE

     5.1 DUE DILIGENCE PERIOD.  Buyer shall have until the expiration of the Due
Diligence   Period  (as   hereinafter   defined)   to  conduct   Due   Diligence
investigations with respect to the Purchased Assets. Seller shall make available
to Buyer and its employees,  representatives,  counsel and consultants access to
all of its  documents,  materials,  books,  records  and files  relating  to the
Purchased Assets in Seller's possession or reasonable control, and Seller agrees
to  allow  Buyer  to make  copies  at  Seller's  office  of such  items as Buyer
reasonably  requests and at Buyer's sole cost and expense.  As used herein, "Due
Diligence  Period" means the period  commencing on the date the parties  execute
this Agreement and ending at 5:00 P.M.  (Mountain  Standard Time) on the Initial
Hearing Date.

     5.2 TERMINATION DURING DUE DILIGENCE. Prior to the end of the Due Diligence
Period,  Buyer shall have the right to terminate  this  Agreement at any time in
its sole and absolute discretion and for any reason or no reason whatsoever upon
delivery  to Seller of  written  notice  informing  Seller  of its  election  to
terminate the  Agreement.  Upon the expiration of the Due Diligence  Period,  if
Buyer has not delivered  written  notice to Seller  terminating  the  Agreement,
then,  the  Deposit  shall  become  non-refundable,  except in the event  that a
condition  precedent of Buyer's duty to close  pursuant to Sections 13.1 through
13.4 or  Section  13.6 has not been  fully and  completely  satisfied  as of the
Closing, in which case the Deposit shall be refunded to Buyer.

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                                   ARTICLE VI.

              REPRESENTATIONS, WARRANTIES, AND COVENANTS OF SELLER

     Seller hereby represents,  warrants, and covenants to Buyer as follows, and
the  warranties,  representations,  and  covenants  contained in this Article or
elsewhere in this Agreement shall be deemed to be made as of the Closing:

     6.1 CORPORATE  STATUS.  Seller is a  corporation  duly  organized,  validly
existing and in good  standing  under the laws of the State of Minnesota  and is
qualified to do business in the State of Arizona.

     6.2 CORPORATE AUTHORITY.  Subject only to approval of the Court, Seller has
full power and authority to execute and perform this Agreement and all corporate
action  necessary to confirm such  authority  has been duly and lawfully  taken.
Upon  execution  hereof,  this  Agreement  shall  be a  valid,  legally  binding
obligation of Seller,  enforceable in accordance  with its terms subject only to
approval by the Court.

     6.3 TITLE TO PURCHASED ASSETS.  Seller has good and marketable title to the
Purchased  Assets,  and has full power and  authority to transfer  such title to
Buyer subject only to approval by the Court.

     6.4 ASSUMED CONTRACTS. The Assumed Contracts are valid, binding and in full
force and effect;  and there  exists no default or event that with the giving of
notice,  the passage of time or both, would constitute a default thereunder that
remains uncured as of the Closing Date.

                                  ARTICLE VII.

               REPRESENTATIONS, WARRANTIES, AND COVENANTS OF BUYER

     Buyer  hereby  represents  and  warrants  to  Seller  as  follows  and  the
warranties  and  representations  contained in this Article or elsewhere in this
Agreement shall be deemed to be made as of Closing:

     7.1  ORGANIZATION.   Buyer  is  a  Minnesota  non-profit  corporation  duly
organized,  validly existing and in good standing under the laws of the State of
Minnesota.

     7.2  AUTHORITY.  Buyer has full power and  authority to execute and perform
this Agreement and all action  necessary to confirm such authority has been duly
and lawfully  taken.  Upon execution  hereof,  this shall be a valid and legally
binding  obligation of Buyer,  enforceable  against Buyer in accordance with its
terms subject only to approval by the Court.

     7.3 CONDITION OF ASSETS. Buyer has fully examined the physical condition of
the Purchased Assets,  and hereby agrees to accept such property AS IS AND WHERE
IS. EXCEPT FOR THE REPRESENTATIONS  AND WARRANTIES  CONTAINED IN THIS AGREEMENT,
NO  REPRESENTATION  OR WARRANTY OF ANY KIND,  EXPRESS OR IMPLIED,  INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, IS MADE
WITH RESPECT TO THE PURCHASED ASSETS.

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                                  ARTICLE VIII.

                                 OTHER COVENANTS

     8.1  TESSERACT  NAME.  Buyer  shall  have a fully  paid-up,  non-exclusive,
perpetual license to use the trademark and trade name "TesseracT" as part of the
full name of the School.  Buyer may prepare for  Seller's  execution a licensing
agreement consistent with the terms herein.

     8.2 TESSERACT NAME. Buyer shall have have the fully paid-up, non-exclusive,
perpetual right to use Seller's curriculum in its post-closing  operation of the
school, including, without limitation,  materials, and instruction techniques of
Seller.

     8.3  DEFERRED  REVENUE  CLAIMS FOR PREPAID  TUITION AND  DEPOSITS.  Parents
previously  paid certain  deposits and prepaid  tuition to Seller which have not
been earned by Seller as of the date of this  Agreement,  but would be earned by
Seller if Seller  continued  to operate  the  School to the end of the  existing
school year (the "Deferred  Revenue  Claims").  It is Seller's  position that if
Buyer purchases the Real Property  underlying this School and  contemporaneously
closes the transaction  set forth in this  Agreement,  Buyer will be responsible
for providing the services related to the Deferred Revenue Claims to the parents
who hold such claims. Buyer disagrees with Seller's position.  The parties fully
reserve their rights with respect to this issue.

     8.4 LEASE CLAIMS.  Seller  understands  that Buyer has or may bring certain
claims  arising  under or relating  to the Lease.  Buyer  reserves  the right to
assert such claims in Seller's bankruptcy case, and Seller reserves the right to
object to all such claims in its bankruptcy case.

     8.5 DELINQUENT  REAL PROPERTY  TAXES.  At Closing,  Seller shall assign and
Buyer shall accept said  assignment of the Delinquent Real Property Taxes on the
Eagan  Property  in an amount  not to exceed  Eighty-Four  Thousand  and  No/100
Dollars ($84,000.00).

     8.6 MECHANIC'S  LIEN. As of Closing,  Seller shall assign,  and Buyer shall
accept said  assignment of the Mechanic's Lien existing on the Eagan Property in
an amount not to exceed  Eighteen  Thousand  Five  Hundred  and  No/100  Dollars
($18,500.00).

                                   ARTICLE IX.

                                    EMPLOYEES

     9.1  DEFINITION.  Seller has  provided  Buyer  with a complete  list of all
persons regularly employed on either a part-time or full-time basis by Seller in
connection with the School.  For purposes of this Article,  the term "Employees"
shall mean all persons on such list.

     9.2 EMPLOYMENT OF SELLER'S EMPLOYEES AT THE SCHOOL. As of the Closing Date,
Buyer shall  assume all of the  Teaching  Contracts.  From and after the Closing
Date,  Buyer shall be solely  responsible  for payment,  when and if due, of all
obligations under the Teaching Contracts,  including,  without  limitation,  any

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accrued  vacation  pay,  sick  leave,  or  bonuses  earned  under  the  Teaching
Contracts,  but  only to the  extent  specifically  set  forth  in the  Teaching
Contracts.  Immediately  prior to, or simultaneously  with, the Closing,  Seller
shall  terminate the employment of all of its employees,  except those employees
under the  Teaching  Contracts.  Buyer  intends to offer  employment  to most of
Seller's employees.  Except for the Teaching  Contracts,  Buyer shall not assume
any  liabilities  relating to, arising from or in connection with any obligation
or  liability  of  Seller  relating  to  employees  or  independent  contractors
including, but not limited to, accrued salaries, other compensation or benefits,
severance payments, accrued vacations, pensions, retirement plans, distributions
or bonuses.  Seller shall indemnify  Buyer for all  pre-Closing  obligations and
liabilities  relating to,  arising from or in connection  with any obligation or
liability of Seller relating to employees or independent contractors (other than
the $86,517.65 due under the Teaching  Contracts as described in SECTION 1.16 of
this  Agreement and subject to  adjustment  as set forth  therein) and any other
employment  relationships,  including,  without  limitation,  payment of accrued
payroll which shall be paid by Seller prior to the Closing.

     9.3 EMPLOYEE SOLICITATIONS. Buyer shall be entitled to reasonable access to
all  employees  related  to  the  School  for  purposes  of  interviewing  these
individuals.

     9.4 WORKERS'  COMPENSATION.  Seller agrees to assume all responsibility for
liability  arising  from  workers'   compensation   claims,   both  medical  and
disability,  which  have been  filed at or prior to the time of Closing or which
arose  out  of  incidents  that  occurred  prior  to  Closing.  Buyer  shall  be
responsible  for all claims,  which arise out of, or are based upon,  incidents,
which occur subsequent to Closing.

                                   ARTICLE X.

                                   INDEMNITIES

     10.1 SELLER.  Seller  agrees to hold  harmless,  indemnify and defend Buyer
from  and  against  any  and all  loss,  claim,  damage,  liability  or  expense
(including,  but not limited to,  reasonable  attorneys' fees and costs) arising
out of or  occurring  as  the  result  of any  breach  by  Seller  of any of its
covenants,  representations or warranties hereunder.  Such indemnification shall
include any claims  pertaining to events or actions  occurring prior to the date
of Closing.  In no event shall the  liability  of Seller under this SECTION 10.1
collectively exceed $5,000.00.

     10.2 BUYER. Buyer agrees to hold harmless, indemnify and defend Seller from
and against any and all loss, claim,  damage,  liability or expense  (including,
but not  limited to,  reasonable  attorneys'  fees and costs)  arising out of or
occurring  as a  result  of any  breach  by  Buyer  of  any  of  its  covenants,
representations  or  warranties  hereunder,  or any  liability  of  Buyer.  Such
indemnification  shall  include  any  claims  pertaining  to events  or  actions
occurring after the date of Closing.  Except with respect to obligations arising
under this SECTION 10.2 as a result of a breach by Buyer of SECTION 3.1, SECTION
7.2 or SECTION 7.3, respectively, the liability of Buyer under this SECTION 10.2
shall not collectively exceed $5,000.00.

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                                   ARTICLE XI.

                                     CLOSING

     11.1 CLOSING.  Closing shall occur at 9:00 a.m. on Friday March 30, 2001 at
the law  offices  of Bryan  Cave LLP,  Two North  Central  Avenue,  Suite  2200,
Phoenix,  Arizona,  or on a date that is not later than ten (10)  business  days
after  the Court  enters  the  Section  363 Order  and the  Section  365  Order;
provided,  however,  that the Closing must occur concurrently with or subsequent
to the closing of the transaction pursuant to which Buyer is purchasing the Real
Property from EPI.

     11.2 TIME IS OF THE ESSENCE. Time is of the essence for the Closing of this
transaction  and if such  Closing  does not occur as  provided  in SECTION  11.1
above, a new Closing Date shall be set for the next business day thereafter,  or
as soon as practicable.

                                  ARTICLE XII.

                                   PRORATIONS.

     The following costs and expenses shall be prorated as of the Closing Date:

     12.1 Personal property taxes, sales taxes and any other assessments related
to the Purchased Assets;

     12.2  Charges  for  utilities  servicing  the  School,  including,  without
limitation,  charges or gas,  electricity,  water, sewer, cable television,  and
telephone services; and

     12.3 Any other reasonable expenses approved in writing by Buyer and prepaid
by Seller related to the operation of the School.

     The amount of any prorations shall be computed by Buyer with the assistance
of Seller.  At Closing,  Buyer shall pay to Seller or Seller shall pay to Buyer,
as the case may be, an amount equal to the net proration so determined.

                                  ARTICLE XIII.

                  CONDITIONS PRECEDENT TO BUYER'S DUTY TO CLOSE

     Buyer shall have no duty to close, and no obligation hereunder,  unless and
until each and every one of the following  conditions  precedent have been fully
and completely satisfied:

     13.1  CONTINUED  TRUTH  OF  WARRANTIES.  All  of  the  representations  and
warranties of Seller  contained  herein shall continue to be true and correct at
Closing.

     13.2  PERFORMANCE  OF  OBLIGATIONS.  Seller  shall have fully  performed or
tendered performance of each and every one of its obligations hereunder which by
its terms is capable of performance before Closing.

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     13.3 DELIVERY OF CLOSING DOCUMENTS.  Seller shall have tendered delivery to
Buyer of all the documents,  in form and substance  reasonably  satisfactory  to
Buyer, required to be delivered to Buyer by Seller on or before Closing pursuant
to this Agreement.

     13.4  LITIGATION.  No lawsuit,  administrative  proceedings  or other legal
action shall have been filed  against  Seller as of the Closing Date which seeks
to  restrain or enjoin  Buyer's  acquisition  of the  Purchased  Assets,  or the
assumption of the Assumed Contracts.

     13.5 REAL PROPERTY. Buyer has purchased the Real Property from EPI.

     13.6  PAYMENT.  Seller  pays to Buyer in  immediately  available  funds the
amount of One Hundred Thousand and No/100 Dollars  ($100,000.00) as set forth in
SECTION 4.1 above.

     13.7 COURT  ORDERS.  The Court shall have entered the Section 363 Order and
the Section 365 Order; provided, however, that Buyer shall not have the right to
not close  this  transaction  solely  because  the  Section  365 Order  approves
Seller's decision to reject the Lease.

                                  ARTICLE XIV.

                 CONDITIONS PRECEDENT TO SELLER'S DUTY TO CLOSE

     Seller shall have no duty to close this  transaction  unless and until each
and  every  one of the  following  conditions  precedent  have  been  fully  and
completely satisfied:

     14.1  CONTINUED  TRUTH  OF  WARRANTIES.  All  of  the  representations  and
warranties of Buyer  contained  herein shall  continue to be true and correct at
Closing.

     14.2  PERFORMANCE  OF  OBLIGATIONS.  Buyer  shall have fully  performed  or
tendered  substantial  performance  of each  and  every  one of its  obligations
hereunder which by its terms is capable of performance before Closing.

     14.3 DELIVERY OF CLOSING  DOCUMENTS.  Buyer shall have tendered delivery to
Seller of all the documents,  in form and substance  reasonably  satisfactory to
Buyer, required to be delivered to Seller by Buyer on or before Closing pursuant
to this Agreement.

     14.4  LITIGATION.  No lawsuit,  administrative  proceedings or legal action
other than the Chapter 11 Case shall have been filed by or against  Seller as of
the  Closing  Date,  which  seeks to  restrain  or enjoin  Seller's  sale of the
Purchased Assets or the assumption of the Assumed Contracts.

     14.5 COURT  ORDERS.  The Court shall have entered the Section 363 Order and
the Section 365 Order; provided, however, that Buyer shall not have the right to
not close  this  transaction  solely  because  the  Section  365 Order  approves
Seller's decision to reject the Lease.

     14.6  PURCHASE  PRICE.  The Buyer pays to Seller in  immediately  available
funds the amount of Thirty Thousand and No/100 Dollars ($30,000.00) as set forth
in SECTION 4.1 above.

                                       10
<PAGE>
     14.7  MECHANIC'S  LIEN.  Buyer shall have assumed the  Mechanic's  Lien and
agrees to fully and faithfully perform all duties and obligations,  due or owing
after the Closing,  of Seller with respect to the  Mechanic's  Lien in an amount
not to exceed Eighteen Thousand and No/100 Dollars ($18,000.00).

     14.8 DELINQUENT  REAL PROPERTY  TAXES.  At Closing,  Buyer shall assume and
assign and Seller shall accept said  assignment of the delinquent  real property
taxes on the Eagan Property in an amount not to exceed Eighty-Four  Thousand and
No/100 Dollars ($84,000.00).

                                   ARTICLE XV.

                   ITEMS TO BE DELIVERED AT CLOSING BY SELLER

     At Closing,  Seller shall,  unless  waived in writing by Buyer,  deliver to
Buyer the following items, each in form and substance  reasonably  acceptable to
Buyer and Buyer's counsel:

     15.1  BILL OF  SALE.  A duly  executed  bill of  sale  selling,  assigning,
transferring, and conveying the Purchased Assets.

     15.2  CERTIFIED  RESOLUTION.  A copy  of the  resolution  of the  Board  of
Directors of Seller authorizing the execution and performance of this Agreement.

     15.3 REPRESENTATIONS AND WARRANTIES. A certificate signed by an appropriate
representative  of  Seller  to the  effect  that  all  the  representations  and
warranties of Seller contained herein are true and correct as of Closing.

                                  ARTICLE XVI.

                    ITEMS TO BE DELIVERED AT CLOSING BY BUYER

     At Closing,  Buyer shall,  unless waived in writing by Seller,  deliver the
following items, each in form and substance reasonably  acceptable to Seller and
Seller's counsel, to Seller:

     16.1  CERTIFIED  RESOLUTION.  A copy of the  resolutions  of the  Executive
Director  of  Buyer  or  other  appropriate  representative(s)  authorizing  the
execution and performance of this Agreement.

     16.2 REPRESENTATIONS AND WARRANTIES. A certificate signed by an appropriate
representative  of  Buyer  to  the  effect  that  all  the  representations  and
warranties of Buyer contained herein are true and correct as of Closing.

                                       11
<PAGE>
                                  ARTICLE XVII.

                                  MISCELLANEOUS

     17.1 RIGHT TO BID. Buyer  acknowledges  and understands  that the Court may
consider higher and better offers.  Notwithstanding,  the parties agree that the
Purchased  Assets and  Assumed  Liabilities,  collectively,  shall be subject to
higher and better offers.

     17.2  FURTHER  ASSURANCES.  Each party  shall,  at any time after  Closing,
execute  and  deliver  to the other  party all such  additional  instruments  of
conveyance and assignments,  certificates or similar documents and take all such
further actions as such other party may reasonably request.

     17.3 NO  ADMISSIONS.  Nothing  in this  Agreement  shall  be,  or  shall be
construed to be, an  admission  of liability by the parties  hereto to any other
person, party or entity.

     17.4 NO OTHER AGREEMENTS.  This Agreement,  and all agreements delivered as
part of the Closing contemplated herein, constitute the entire agreement between
the parties with respect to its subject  matter.  All prior and  contemporaneous
negotiations,  proposals and  agreements  between the parties are  superseded by
this  Agreement.  Any  changes  to this  Agreement  must be agreed to in writing
signed by both parties.

     17.5 WAIVER.  Either party may waive the performance of any obligation owed
to it by the  other  party  hereunder  for  the  satisfaction  of any  condition
precedent to the waiving party's duty to perform any of its covenants, including
its obligations to Close.  Any such waiver shall be valid only if contained in a
writing signed by the waiving party.

     17.6 NOTICES.  Any notices  required or allowed in this Agreement  shall be
effectively given if placed in a sealed envelope, postage prepaid, and deposited
in the United States mail, registered or certified, addressed as follows:

            To Seller:     Michael Lynch
                           The TesseracT Group, Inc.
                           4515 East Muirwood Drive
                           Phoenix, Arizona  85048

            Copy To:       Robert J. Miller, Esq.
                           Bryan Cave LLP
                           Two North Central Avenue, Suite 2200
                           Phoenix, Arizona  85004

                                       12
<PAGE>
            To Buyer:      Tesseract of Eagan, Inc.
                           c/o Carpenter Evert & Associates
                           Minnesota Center-Suite 1340
                           7760 France Avenue South
                           Bloomington, Minnesota  55435
                           Attention:  Mr. Neal Evert
                           Telephone No.: (952) 831-0085
                           Facsimile No.: (952) 831-0792

            Copy To:       Jim Cross, Esq.
                           Osborn Maledon
                           2929 N. Central Avenue, 21st Floor
                           Phoenix, Arizona  85012-2794

     17.7 BROKER AND FINDERS. Each of the parties hereto represents and warrants
to the  other  that it has not  employed  or  retained  any  broker or finder in
connection with the  transactions  contemplated by this Agreement nor has it had
any  dealings  with  any  person  which  may  entitle  such  person  to a fee or
commission  from any party hereto.  Each of the parties shall indemnify and hold
the other harmless for, from and against any claim,  demand or damage whatsoever
by virtue of any arrangement or commitment made by it with or to any person that
may entitle  such person to any fee or  commission  from the other party to this
Agreement.

     17.8  RISK OF  LOSS.  The  risk of  loss,  damage,  or  destruction  of the
Purchased  Assets shall be borne by Seller until Closing.  In the event any loss
or damage to or taking of any such  Purchased  Assets is material in the context
of this transaction and occurs before Closing,  Seller shall immediately  notify
Buyer of the nature and extent of such loss, damage or taking,  and Buyer shall,
at its option,  by written  notice to Seller,  either  terminate  this Agreement
without  further  liability or obligation  to Seller,  or Buyer may proceed with
this transaction on the terms and conditions  mutually agreeable to the parties,
including any adjustment in the Purchase Price.

     17.9 THIRD-PARTY BENEFICIARY. Nothing contained herein shall create or give
rise to any  third-party  beneficiary  rights for any  individual or entity as a
result of the terms and provisions of this Agreement.

     17.10 COURT JURISDICTION.  Upon the execution hereof, the parties will file
this  Agreement  with the  Court.  Upon  approval  thereof,  the Court will have
continuing  jurisdiction  to resolve any and all  disputes  that may arise under
this Agreement.

     17.11  RELATIONSHIP OF PARTIES.  The relationship of Seller and Buyer shall
be that of  independent  entities and neither shall be deemed to be the agent of
the other.

     17.12 CHOICE OF LAW. This Agreement shall be governed by and interpreted in
accordance  with the laws of the  State  of  Arizona  and,  as  applicable,  the
Bankruptcy Code.

                                       13
<PAGE>
     17.13  PARAGRAPH  HEADINGS.  The Section,  Article and  paragraph  headings
contained herein are for convenience only and shall have no substantive  bearing
on the interpretation of this Agreement.

     17.14 RULES OF INTERPRETATION.  The following rules of interpretation shall
apply to this Agreement,  the Schedules hereto and any certificates,  reports or
other  documents or instruments  made or delivered  pursuant to or in connection
with this Agreement,  unless otherwise  expressly provided herein or therein and
unless the context hereof or thereof clearly requires otherwise:

          17.14.1 A reference to any document or  agreement  shall  include such
document or agreement as amended,  modified or supplemented from time to time in
accordance with its terms, and if a term is said to have the meaning assigned to
such term in another document or agreement and the meaning of such terms therein
is amended, modified or supplemented, then the meaning of such term herein shall
be deemed automatically amended, modified or supplemented in a like manner.

          17.14.2  References to the plural  include the singular,  the singular
the plural and the part the whole.

          17.14.3  The words  "include,"  "includes,"  and  "including"  are not
limiting.

          17.14.4 A reference to any law includes any amendment or  modification
to such law, which is in effect on the relevant date.

          17.14.5 A reference to any person or entity  includes its  successors,
heirs and permitted assigns.

          17.14.6 The words "hereof,"  "herein,"  "hereunder," and similar terms
in this  Agreement  refer to this Agreement as a whole and not to any particular
provision of this Agreement.

          17.14.7 All Schedules to this Agreement  constitute  material terms of
this Agreement and are incorporated fully into the terms of this Agreement.

     17.15 TIME IS OF THE ESSENCE. Time is of the essence in the performance and
observance of all obligations and duties under this Agreement.

     17.16  ATTORNEY  FEES.  Each party  shall bear its own legal fees and costs
incurred in the negotiation and closing of this  transaction.  In the event of a
dispute arising between the parties under this Agreement,  the prevailing  party
shall be  entitled  to  reasonable  attorneys'  fees and  costs of suit from the
non-prevailing party.

     17.17 COUNTERPARTS;  FACSIMILE SIGNATURES. This Agreement maybe executed in
any number of counterparts,  each of which shall be an original, but all of such
counterparts shall together constitute but one and the same instrument. Delivery
of an executed  counterpart of this Agreement by telefacsimile  shall be equally
as effective as delivery of a manually  executed  counterpart of this Agreement.

                                       14
<PAGE>
Any party delivering an executed  counterpart of this Agreement by telefacsimile
also shall deliver a manually  executed  counterpart  of this  Agreement but the
failure  to  deliver  a  manually  executed  counterpart  shall not  affect  the
validity, enforceability, and binding effect of this Agreement.

     IN WITNESS  WHEREOF,  the parties hereto have set their hands effective the
date set forth above.

                                 THE TESSERACT GROUP, INC.,
                                 a Minnesota corporation.

                                 By:
                                     -------------------------------------------
                                 Name:
                                     -------------------------------------------
                                 Its:
                                     -------------------------------------------

                                 SELLER

                                 TESSERACT OF EAGAN, INC., a Minnesota
                                 non-profit corporation.

                                 By:
                                     -------------------------------------------
                                 Name:
                                     -------------------------------------------
                                 Its:
                                     -------------------------------------------

                                 BUYER

                                       15<PAGE>   1

                                                                     EXHIBIT 4.1

                               AMENDMENT NO. 1 TO
                              AMENDED AND RESTATED
                                RIGHTS AGREEMENT

     Amendment No. 1 (this "AMENDMENT") dated as of October 24, 2000, to that
certain Amended and Restated Rights Agreement dated as of May 18, 1999 (the
"RIGHTS AGREEMENT"), between Vans, Inc., a Delaware corporation (the "Company"),
and Mellon Investor Services LLC, formerly known as ChaseMellon Shareholder
Services, L.L.C., a New Jersey limited liability corporation, as Rights Agent
thereunder (the "RIGHTS AGENT").

                               W I T N E S S E T H

     WHEREAS, pursuant to Section 27 of the Rights Agreement, the Company and
the Rights Agent desire to amend the Agreement as set forth herein;

     NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth, the parties hereto hereby agree as follows:

     Section 1. AMENDMENT TO SUBSECTION 1(A). Subsection 1(a) of the Rights
Agreement is hereby amended to delete the number "15%" throughout such
Subsection and replace it with the number "20%."

     Section 2. AMENDMENT TO SECTION 23. Section 23 of the Rights Agreement is
hereby amended to add the following provision to the end thereof:

     "Notwithstanding anything to the contrary contained herein, if the Board of
Directors of the Company does not redeem the Rights within 120 days after the
Flip-In Event, then shareholders of the Company who are unaffiliated with the
Acquiring Person and who represent not less than 20% of the outstanding Common
Stock of the Company, shall have the right to seek shareholder approval of a
resolution authorizing the redemption of the Rights."

     Section 3. GOVERNING LAW. This Amendment shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
governed by and construed in accordance with the laws of such State applicable
to contracts to be made and performed entirely within such State, except that
the rights and obligations of the Rights Agent under this Amendment shall be
governed by and construed in accordance with the laws of the State of California
in effect in that State.

     Section 4. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.

<PAGE>   2

     Section 5. RIGHTS AGREEMENT AS AMENDED. The term "Agreement" as used in the
Rights Agreement shall be deemed to refer to the Rights Agreement as amended
hereby. Except as expressly set forth herein, this Agreement shall not by
implication or otherwise amend or otherwise modify, alter or in any way affect
any term, condition, obligation, covenant or agreement contained in the Rights
Agreement, all of which are ratified and affirmed in all respects and shall
continue in full force and effect.

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.

THE COMPANY:                               THE RIGHTS AGENT:

VANS, INC.                                 MELLON INVESTOR
                                           SERVICES L.L.C.

By:  /s/ CRAIG E. GOSSELIN                 By: /s/ JAMES KIRKLAND
    ------------------------                    -------------------------
    Craig E. Gosselin                           James Kirkland
    Vice President,                             Assistant Vice President
    General Counsel
    and Corporate Secretary

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