Agreement for Westminster Choir College Sale Raises Concerns

March 26, 2019

Opponents of Rider University’s planned sale of Westminster Choir College to a Chinese education company say the newly released purchase agreement undermines Rider’s public promises that the company will continue to operate the Princeton, N.J.-based choir college for at least 10 years after the sale.

The purchase agreement with Kaiwen Education does include previously publicized provisions -- provisions 7.13 and 7.14 -- that stipulate that Kaiwen will continue to operate the choir campus for at least 10 years and that it will "substantially maintain" current academic programs for at least five years. However, it also includes another provision -- provision 7.15 -- that releases Kaiwen from those obligations if it considers them "substantially impartible" or "economically infeasible."

"Notwithstanding Section 7.13 and Section 7.14, buyer parties shall not be obligated to continue any specific programs or the programs of WCC, or to continue to operate or to maintain the college, if the affected buyer party determines, in good faith, that such continued action would be substantially impracticable, economically infeasible or would substantially adversely affect WCC, its business, operations and/or the acquired business," the purchase agreement states.

Bruce Afran, a lawyer for the Westminster Foundation, a group of faculty and alumni who are suing to block the sale, said that Rider, a private university, had withheld the purchase agreement and only produced it upon the order of the trial judge overseeing litigation involving the sale. The Westminster Foundation obtained the sale agreement via an open-records request to the New Jersey attorney general's office.

“Now we know that Rider University kept the contract secret because it contained a clause allowing Kaiwen Education to close the school at any time for virtually any reason,” Afran said. “Section 7.15 places virtually no limits on the power of the Chinese buyer to shut the choir college.”

Rider said in a statement that its board "has worked ceaselessly to find a partner to continue to operate WCC and ultimately determined that the transaction proposed by the current buyer was the best opportunity to preserve WCC in Princeton." The statement said that the buyer committed to invest $16 million in Westminster over five years and has made the aforementioned five- and 10-year commitments.

"The ability to modify, change or discontinue academic offerings and programs because they are deemed substantially impracticable, economically infeasible or would substantially adversely affect WCC or Rider is the same right under which Rider has operated Westminster under the terms of the merger agreement entered into between Rider and Westminster in 1991," the statement said. "It is irresponsible to suggest that Rider entered into an agreement that allows the buyer to close Westminster at any time."

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