EXHIBIT 2.3
ASSET PURCHASE AGREEMENT
By and Between
TULIX SYSTEMS, INC.
(A Georgia corporation)
And
HOMECOM COMMUNICATIONS, INC.
(A Delaware corporation)
Dated as of
March 27, 2003
TABLE OF CONTENTS
Page
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SECTION 1. SALE AND PURCHASE.................................................1
SECTION 2. ASSUMPTION OF LIABILITIES BY THE PURCHASER........................2
SECTION 3. PURCHASE PRICE AND PAYMENT........................................2
SECTION 4. REPRESENTATIONS AND WARRANTIES OF SELLER..........................3
SECTION 5. REPRESENTATIONS AND WARRANTIES OF PURCHASER.......................4
SECTION 6. CONDITIONS TO CLOSING.............................................6
SECTION 7. CLOSING...........................................................8
SECTION 8. COVENANTS OF SELLER AND PURCHASER.................................8
SECTION 9. RELEASES.........................................................11
SECTION 10. CLAIMS...........................................................11
SECTION 11. MISCELLANEOUS....................................................12
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Schedules
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1(b) -- Intellectual Property
1(c) -- Contracts
1(d) -- Accounts Receivable
1(e) -- Equipment
3(c) -- Payments that will Cause an Adjustment to the Guaranteed Closing
Date Cash
4(d) -- Required Government Consents
4(e) -- Required Contract Consents
4(f) -- Contracts - Terms and Monthly Revenues
4(h) -- Intellectual Property - Ownership
4(j) -- Seller Litigation
5(d) -- Required Government Consents
5(e) -- Required Contract Consents
5(g) -- Purchaser Capital Stock
5(h) -- Purchaser Litigation
8(a) -- Allocation of Purchase Price
Exhibits
--------
Exhibit 1 Form of Shareholders' Agreement
Exhibit 2 Form of Secured Promissory Note
Exhibit 3 Form of Security Agreement
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ASSET PURCHASE AGREEMENT
------------------------
This Asset Purchase Agreement (this "Agreement") is made and entered into
as of the 27th day of March, 2003, by and between Tulix Systems, Inc., a Georgia
corporation (the "Purchaser"), and HomeCom Communications, Inc., a Delaware
corporation (the "Seller").
RECITALS
--------
The Seller is engaged in the business of developing and hosting Internet
applications, products and services to commercial customers (the "Business").
The Purchaser desires to purchase, and the Seller desires to sell, all of
the assets of Seller associated with the Business, and Seller desires to assign,
and Purchaser desires to assume, certain contracts of Seller related to the
Business, all upon the terms and conditions and subject to the limited
exceptions set forth herein.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants, and agreements of the parties hereinafter set forth, the parties
hereto, intending to be legally bound, do hereby agree as follows:
SECTION 1.
SALE AND PURCHASE
Upon the terms and subject to the conditions of this Agreement, Purchaser
shall purchase, acquire, and assume from Seller, and Seller shall sell,
transfer, assign, convey, and deliver to Purchaser, at the Closing (as defined
in Section 7(a)), all right, title, and interest in and to the following assets
and associated liabilities of Seller:
(a) Cash in the amount of $50,000 (the "Cash");
(b) The intellectual property identified in Schedule 1(a) (the
"Intellectual Property");
(c) The contracts identified in Schedule 1(b) (the "Contracts");
(d) Accounts Receivable as identified in Schedule 1(c) (the "Accounts
Receivable"), the aggregate amount of which shall not exceed $70,000; and,
(e) The equipment being used as of the date hereof to service and maintain
the Contracts and operate the Business, as identified in Schedule 1(d) (the
"Equipment"; the Equipment, the Cash, the Intellectual Property, the Contracts
and the Accounts Receivable are collectively referred to herein as the
"Assets").
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SECTION 2.
ASSUMPTION OF LIABILITIES BY THE PURCHASER
From and after the Closing, Purchaser shall assume and be responsible
for all obligations and liabilities of Seller identified in Schedule 2. Seller
shall not have any liability or obligation of Purchaser relating to acts or
omissions of Purchaser subsequent to the Closing Date.
SECTION 3.
PURCHASE PRICE AND PAYMENT
(a) Generally. The total consideration to be paid by Purchaser to Seller
for the sale, transfer and conveyance of the Assets shall consist of (i) 1,500
shares of Common Stock of Purchaser (the "Shares"), representing fifteen percent
(15%) of the outstanding common stock of Purchaser, with such rights as may be
set forth in a Shareholders' Agreement (the "Shareholders' Agreement")
substantially in the form attached hereto as Exhibit 1, and (ii) a secured
promissory note for the principal amount of $70,000 (the "Note") substantially
in the form attached hereto as Exhibit 2 and subject to adjustment as set forth
in Section 3(b) below (the Shares and the principal amount of the Note are
collectively referred to herein as the "Purchase Price"), which Note shall be
secured as provided in the Note and in a Security Agreement substantially in the
form attached hereto as Exhibit 3 (the "Security Agreement"). Purchaser
acknowledges that it is purchasing the Assets "as is", without any
representation or warranty, explicit or implied, except as set forth in this
Agreement.
(b) Cash at Closing. Purchaser and Seller acknowledge and agree that Seller
will have cash and accounts receivable (as determined in conformity with U.S.
GAAP applied on a basis consistent with Seller's past practices) on the Closing
Date in an amount equal to (i) $325,053 less (ii) any amounts paid by Seller
prior to the Closing Date in respect of any of the payment matters listed on
Schedule 3(b) hereto (the "Guaranteed Closing Date Cash/AR"). In the event that
the aggregate amount of actual cash and accounts receivable of Seller on the
Closing Date (as determined in conformity with U.S. GAAP applied on a basis
consistent with the Seller's past practices) is less than the Guaranteed Closing
Date Cash/AR (the amount by which the actual amount of cash and accounts
receivable is less than the Guaranteed Closing Date Cash/AR is referred to
herein as the "Cash/AR Shortfall"), the principal amount of the Note referred to
in Section 3(a) hereof shall be increased by an amount equal to the Cash/AR
Shortfall. In the event that the aggregate amount of actual cash and accounts
receivable (as determined in conformity with U.S. GAAP applied on a basis
consistent with the Seller's past practices) exceeds the Guaranteed Closing Date
Cash/AR (the amount by which the actual amount of cash and accounts receivable
exceeds the Guaranteed Closing Date Cash/AR is referred to herein as the
"Cash/AR Excess"), the Cash/AR Excess shall be divided evenly between Purchaser
and Seller. The portion of the Cash/AR Excess to which Purchaser is entitled
pursuant to the foregoing sentence shall be paid to Purchaser in the following
manner: the amount of Cash to be delivered to Purchaser pursuant to Section 1(a)
hereof shall be increased by an amount equal to one-half of the Cash/AR Excess.
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SECTION 4.
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Purchaser as follows:
(a) Corporate Existence. Seller is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware. To the
best of the knowledge of Seller, Seller has the corporate power and authority to
conduct its business and to own and lease all of its properties and assets and
is duly qualified or licensed to do business and is in good standing under the
laws of each jurisdiction where such qualification is required, except where the
failure to be so qualified would not have a material adverse effect on the
Assets or the Business (financial or otherwise) (a "Material Adverse Effect").
(b) Corporate Power; Authorization; Enforceable Obligations. To the best of
the knowledge of Seller, Seller has the corporate power and authority to execute
and deliver this Agreement and the other agreements and instruments to be
executed and delivered by it in connection with the transactions contemplated
hereby and thereby and to perform its respective obligations hereunder and
thereunder (this Agreement and such other agreements and instruments are
collectively referred to herein as the "Seller Documents"). Seller has taken or
will take all necessary corporate action, including obtaining the requisite
approval of the stockholders of Seller, that is required under the Delaware
General Corporation Law, to authorize the execution and delivery of this
Agreement and the other Seller Documents and the consummation of the
transactions contemplated hereby and thereby. To the best of the knowledge of
Seller, this Agreement is, and the other Seller Documents will be, the legal,
valid, and binding obligations of Seller, enforceable in accordance with their
terms, except as such enforcement may be subject to or limited by bankruptcy,
insolvency, reorganization, moratorium, or other similar laws now or hereafter
in effect and by general principles of equity.
(c) No Conflict. To the best of the knowledge of Seller, the execution and
delivery of this Agreement and the other Seller Documents will not (i) violate
any foreign, federal, state, or local law, regulation, ordinance, zoning
requirement, governmental restriction, order, judgment, or decree (collectively,
"Laws") applicable to Seller or the Assets or the Business, or (ii) violate or
conflict with any provision of the certificate of incorporation or bylaws of
Seller.
(d) Access to Information. The principals of the Purchaser are also the
executive officers of the Seller and members of the Seller's board of directors.
Seller has had access to sufficient information about Purchaser upon which to
analyze the transactions contemplated by this Agreement. Seller has been given
the opportunity to ask questions and receive answers from the officers of
Purchaser concerning the terms and conditions of the transactions contemplated
by this Agreement and the business and financial condition of Purchaser. Seller
has had the opportunity to obtain any additional information it deems necessary
to verify the accuracy and completeness of information provided by Purchaser in
connection with this Agreement and the transactions contemplated hereby.
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(e) "Knowledge of the Seller." For purposes of this Agreement, the term
"knowledge of the Seller" shall mean the actual knowledge of those members (as
of the date hereof and the Closing Date) of the board of directors of Seller
other than Xxxxxxx X. Xxxxxxxx, Xxx Xxxxxxxxx and Nino Doijashvili.
SECTION 5.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
(a) Corporate Existence. Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Georgia. Purchaser
has the corporate power and authority to conduct its business and to own and
lease all of its properties and assets and is duly qualified or licensed to do
its business and is in good standing under the laws of each jurisdiction where
such qualification is required, except where the failure to be so qualified
would not have a material adverse effect on Purchaser.
(b) Corporate Power; Authorization; Enforceable Obligations. Purchaser has
the corporate power, authority and legal right to execute, deliver and perform
this Agreement and the other agreements and instruments to be executed and
delivered in connection with the transactions contemplated hereby and thereby
(this Agreement and such other agreements and instruments are referred to
collectively as the "Purchaser Documents"). The execution, delivery and
performance of this Agreement and the other Purchaser Documents, and the
consummation of the transactions contemplated hereby and thereby, by Purchaser
have been duly authorized by all necessary corporate action of Purchaser. This
Agreement is, and the other Purchaser Documents will be, the legal, valid and
binding obligation of Purchaser enforceable against Purchaser in accordance with
their terms except as such enforcement may be subject to or limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance,
fraudulent transfer or other similar laws now or hereafter in effect affecting
creditors' rights generally, and by general principles of equity.
(c) No Conflict. To the best of the knowledge of Purchaser, the execution
and delivery of this Agreement and the other Purchaser Documents will not (i)
violate any foreign, federal, state, or local law, regulation, ordinance, zoning
requirement, governmental restriction, order, judgment, or decree (collectively,
"Laws") applicable to Purchaser or the Assets or the Business, (ii) violate or
conflict with any provision of the certificate of incorporation or bylaws of
Purchaser, or (iii) conflict with, result in the breach of, or constitute a
default under any mortgage, indenture, license, instrument, trust, contract,
agreement, or other commitment or arrangement to which Purchaser is a party or
by which Purchaser is bound.
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(d) Required Government Consents. Except for (i) the filing or recording of
instruments of conveyance, transfer, or assignment required by federal
copyright, patent, or trademark laws or the laws of the U.S. and non-U.S.
jurisdictions and states in which the Assets are located; and (ii) the further
exceptions disclosed in Schedule 5(d) (the foregoing items (i) and (ii) being
referred to herein as the "Required Government Consents"), to the best of the
knowledge of Purchaser, no approval, authorization, certification, consent,
permission, license, or permit to or from, or notice, filing, or recording to or
with, U.S. or non-U.S., federal, state, or local governmental authorities
("Governmental Authorities") is necessary for the execution and delivery of this
Agreement and the other Purchaser Documents or the consummation by Purchaser of
the transactions contemplated hereby or thereby, or the ownership and use of the
Assets or operation of the Business (including by Purchaser, assuming such
ownership, use and operation is substantially the same as the ownership, and use
and operation by Seller).
(e) Required Contract Consents. To the best of the knowledge of Purchaser,
except as disclosed in Schedule 5(e) (such scheduled items being referred to
herein as the "Required Contract Consents"), no approval, authorization,
consent, permission, or waiver to or from, or notice, filing, or recording to or
with, any person (other than the Required Government Consents) is necessary for
(i) the execution and delivery of this Agreement and the other Purchaser
Documents or the consummation of the transactions contemplated hereby or
thereby; (ii) the transfer and assignment to Purchaser at the Closing of the
Assets; or (iii) the ownership and use of the Assets or operation of the
Business (including by Purchaser, assuming such ownership, use and operation is
substantially the same as the ownership, use and operation by Seller).
(f) Purchaser Common Stock. The Shares to be issued to Seller pursuant to
this Agreement, when issued and delivered in accordance with this Agreement will
be duly authorized, validly issued, fully paid and non-assessable, will be free
of any liens or encumbrances, and will not be subject to any preemptive rights
or redemption rights.
(g) Purchaser Capital Structure. The authorized capital stock of Purchaser
consists of One Thousand (1,000) shares of preferred stock, of which no shares
have been issued and are outstanding as of the date hereof, and Ten Thousand
(10,000) shares of common stock, of which Eight Thousand Five Hundred (8,500)
shares are issued and outstanding as of the date hereof. All issued and
outstanding shares of Purchaser's capital stock have been duly authorized and
validly issued, are fully-paid and non-assessable, are owned beneficially and of
record by the shareholders and in the amounts set forth on Schedule 5(g), and
have been offered, issued, sold and delivered by Purchaser in compliance with
all applicable securities laws. There are no outstanding rights, options,
warrants, conversion rights, or agreements for the purchase or acquisition from
Purchaser of any shares of its capital stock other than the rights created by
this Agreement and the Shareholders' Agreement.
(h) Litigation. Except as disclosed in Schedule 5(h), no claim, action,
suit, proceeding, inquiry, hearing, arbitration, administrative proceeding,
infringement claim, or investigation (collectively, "Litigation") is pending,
or, to Purchaser's best knowledge, threatened against Purchaser or its
subsidiaries or any of its present or former directors, officers, or employees.
Purchaser knows of no facts or circumstances that could reasonably be expected
to serve as the basis for Litigation against Purchaser or its present or former
directors, officers, or employees.
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(i) Court Orders, Decrees, and Laws. There is no outstanding or, to
Purchaser's best knowledge, threatened, order, writ, injunction, or decree of
any court, governmental agency, or arbitration tribunal against Purchaser. To
the best of the knowledge of Purchaser, Purchaser is and has been in compliance
in all material respects with all applicable Laws, and Purchaser has received no
notices of any such alleged violation. The foregoing shall be deemed to include
Laws relating to the patent, copyright, and trademark laws, state trade secret
and unfair competition laws of the U.S. and foreign jurisdictions, and all other
applicable Laws, including equal opportunity, wage and hour, and other
employment matters, and antitrust and trade regulation laws.
(j) Access to Information. The principals of the Purchaser are also the
executive officers of the Seller and members of the Seller's board of directors.
The principals of the Purchaser are the parties responsible for the creation of
all schedules to this Agreement. Purchaser has had access to sufficient
information about Seller upon which to analyze the transactions contemplated by
this Agreement. Purchaser has been given the opportunity to ask questions and
receive answers from the officers of Seller concerning the terms and conditions
of the transactions contemplated by this Agreement and the business and
financial condition of Seller. Purchaser has had the opportunity to obtain any
additional information it deems necessary to verify the accuracy and
completeness of information provided by Seller in connection with this Agreement
and the transactions contemplated hereby.
(k) Disclosure. Purchaser has completely and accurately responded to the
inquiries and diligence requests of Seller and its agents, representatives,
attorneys and employees in connection with the transactions contemplated by this
Agreement. No representation, warranty, or statement made by Purchaser in this
Agreement or in any document or certificate furnished or to be furnished to
Seller pursuant to this Agreement contains or will contain any untrue statement
or omits or will omit to state any fact necessary to make the statements
contained herein or therein, under the circumstances in which they were made,
not materially misleading. Purchaser has disclosed to Seller all facts known or
reasonably available to Purchaser that are material to Purchaser.
SECTION 6.
CONDITIONS TO CLOSING
(a) Conditions to Seller's Obligations. The obligations of Seller to be
performed hereunder shall be subject to the satisfaction (or waiver by Seller)
at or prior to the Closing Date of each of the following conditions:
(i) Purchaser's representations and warranties contained in this
Agreement shall be true and correct in all respects on and as of the date of
this Agreement.
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(ii) Purchaser shall have performed and complied with all agreements,
obligations and conditions required by this Agreement to be performed or
complied with by it on or prior to the Closing.
(iii) Seller's stockholders shall have approved the sale of the Assets
to Purchaser.
(iv) No Litigation shall be threatened or pending against Seller
before any court or governmental agency that, in the reasonable opinion of
counsel for Seller, could result in the restraint or prohibition of Seller in
connection with this Agreement or the consummation of the transactions
contemplated hereby.
(v) Purchaser shall have delivered to Seller a certificate signed by a
duly authorized officer of Purchaser certifying that the conditions set forth in
Sections 6(a)(i) and (ii) have been satisfied.
(vi) Seller shall have obtained a general release in favor of Seller
from each of the counter-parties to the Contracts listed in Schedule 1(c).
(b) Conditions to Purchaser's Obligations. Each of the obligations of
Purchaser to be performed hereunder shall be subject to the satisfaction (or
waiver by Purchaser) at or prior to the Closing Date of each of the following
conditions:
(i) Seller's representations and warranties contained in this
Agreement shall be true and correct in all respects on and as of the date of
this Agreement.
(ii) Seller shall have performed and complied with all agreements,
obligations, and conditions required by this Agreement to be performed or
complied with by it on or prior to the Closing.
(iii) No Litigation shall be threatened or pending against Purchaser
before any court or governmental agency that, in the reasonable opinion of
counsel for Purchaser, could result in the restraint or prohibition of Purchaser
in connection with this Agreement or the consummation of the transactions
contemplated hereby.
(iv) Seller shall have delivered to Purchaser a certificate signed by
an authorized officer of Seller certifying that the conditions set forth in
Sections 6(b)(i) and (ii) have been satisfied.
(v) RoadRunner shall be an ongoing customer of Seller, and Seller
shall not have received any form of notice from RoadRunner that Roadrunner
intends to terminate its relationship with Seller or that Roadrunner does not
intend to continue such relationship with Purchaser following the Closing Date,
or that RoadRunner has changed materially or intends to change materially the
amount of business that it does with Seller or the amount of business that it
would do with Purchaser following the Closing Date.
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SECTION 7.
CLOSING
(a) Closing. The closing of the purchase and sale of the Assets (the
"Closing") shall take place at the offices of Xxxxxxxxxx Xxxxxx & Xxxxxxx LLP,
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx commencing at 2:00 p.m. on such
date as the respective conditions to closing of both parties have been satisfied
or waived or on such other date as the parties shall agree (the "Closing Date").
Subject to consummation of the Closing on the Closing Date, the sale,
assignment, transfer and conveyance to Purchaser of the Assets will be effective
as of 12:01 a.m. Eastern Standard Time on the Closing Date.
(b) Actions at Closing. At Closing, Purchaser and Seller shall take the
following actions, in addition to such other actions as may otherwise be
required under this Agreement:
(i) Copies of Consents. Seller shall deliver copies of all Required
Contract Consents and all Required Government Consents which have been obtained.
(ii) Conveyance Instruments. Seller shall deliver to Purchaser such
bills of sale, assignments, and other instruments of conveyance and transfer as
Purchaser may reasonably request to effect the transfer and assignment of the
Assets to Purchaser.
(iii) Assumption Agreements; Releases. Purchaser shall deliver to
Seller one or more assumption agreements in form reasonably acceptable to
Seller, pursuant to which Purchaser assumes and agrees to pay and perform the
Contracts. Purchaser shall deliver general releases to Seller from the
counterparties to the Contracts.
(iv) Certificates. The parties shall deliver to each other the
certificates required under Section 6.
(v) Shareholders' Agreement. The parties shall deliver to each other
executed signature pages to the Shareholders' Agreement.
(vi) Other. Each party shall deliver such other agreements and
instruments as the other party may reasonably request.
(c) Delivery of Purchase Price. At Closing, Purchaser shall deliver to
Seller (i) a stock certificate representing the Shares, (ii) the Note and (iii)
the Security Agreement.
SECTION 8.
COVENANTS OF SELLER AND PURCHASER
(a) Allocation of Purchase Price. The Purchase Price shall be allocated as
disclosed in Schedule 8(a), and all tax returns and reports filed by Seller and
Purchaser with respect to the transactions contemplated by this Agreement shall
be consistent with that allocation.
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(b) Maintenance of Books and Records. Each of Seller and Purchaser shall
preserve until the second anniversary of the Closing Date all records possessed
or to be possessed by such party relating to any of the Assets or the Business
prior to the Closing Date, except for those records transferred from Seller to
Purchaser at Closing. After the Closing Date, where there is a legitimate
purpose, such party shall provide the other party with access, upon prior
reasonable written request specifying the need therefor, during regular business
hours, to (i) the officers and employees of such party, and (ii) the books of
account and records of such party, but, in each case, only to the extent
relating to the Assets or the Business prior to the Closing Date, and the other
party and its representatives shall have the right to make copies of such books
and records; provided, however, that the foregoing right of access shall not be
exercisable in such a manner as to interfere unreasonably with the normal
operations and business of such party; and further provided, that, as to so much
of such information as constitutes trade secrets or confidential business
information of such party, the requesting party and its officers, directors and
representatives will use due care to not disclose such information except (A) as
required by any applicable Laws, (B) with the prior written consent of the party
who owns such information, which consent shall not be unreasonably withheld,
delayed or conditioned or (C) where such information becomes available to the
public generally, or becomes generally known to competitors of such party,
through sources other than the requesting party, its affiliates or its officers,
directors or representatives. Such books and records may nevertheless be
destroyed by a party if such party sends to the other party written notice of
its intent to destroy such books and records, specifying with particularity the
contents of the books and records to be destroyed. Such books and records may
then be destroyed after the 30th day after such notice is given unless the other
party objects to the destruction, in which case the party seeking to destroy the
books and records shall deliver such books and records to the objecting party.
(c) Mail, Etc. Mail and payments relating to the Assets received by Seller
after the Closing Date will be forwarded to Purchaser. From and after the
Closing Date, Seller will promptly refer all inquiries relating to the Assets to
Purchaser.
(d) Certain Consents. To the extent that Seller's rights under any
Contract, permit, or other Asset to be assigned to Purchaser hereunder may not
be assigned without the consent of another person which has not been obtained
prior to the Closing Date, and which is material to the ownership, use or
disposition of an Asset or the operation of the Business, this Agreement shall
not constitute an agreement to assign the same if an attempted assignment would
constitute a breach thereof or be unlawful, and Seller and Purchaser shall use
their commercially reasonable good faith efforts to obtain any such required
consents as promptly as possible.
(e) Best Efforts; Further Assurances; Cooperation. Subject to the other
provisions in this Agreement, the parties hereto shall in good faith perform
their obligations under this Agreement before, at and after the Closing, and
shall each use their reasonable best efforts to do, or cause to be done, all
things necessary, proper or advisable under applicable Laws to obtain all
authorizations and consents and satisfy all conditions to the obligations of the
parties under this Agreement, and to cause the transactions contemplated by this
Agreement to be carried out promptly in accordance with the terms hereof. The
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parties shall cooperate fully with each other and their respective officers,
directors, employees, agents, counsel, accountants and other designees in
connection with any steps required to be taken as part of their respective
obligations under this Agreement. Upon the execution of this Agreement and
thereafter, each party shall take such actions and execute and deliver such
documents as may be reasonably requested by the other party hereto in order to
consummate more effectively the transactions contemplated by this Agreement.
(f) Transition. Seller shall have a reasonable period of time after the
Closing in which to remove its books and records from Seller's former premises.
Purchaser will provide such assistance in this process as Seller may reasonably
request, including but not limited to (1) providing access to Purchaser's
premises at such reasonable times as Seller may request, and (2) making the
appropriate officers and directors of Purchaser available to Seller to assist
the new officers of Seller in familiarizing themselves with Seller's books and
records, and other issues related to the continued management of the Seller.
SECTION 9.
RELEASES
(a) Purchaser Release. Effective as of the Closing Date, Purchaser, for
itself and on behalf of all of its direct and indirect partners, shareholders,
members, officers, directors, employees, affiliates (both persons and entities),
representatives, beneficiaries, predecessors in interest, successors in
interest, and assigns (the "Releasing Parties"), shall release and forever
discharge Seller and all of its direct and indirect partners, members, officers,
directors, employees, affiliates (both persons and entities), representatives,
beneficiaries, predecessors in interest, successors in interest, and assigns
(the "Released Parties"), of and from any and all claims, demands, actions and
causes of action whatsoever, in law or equity, whether known or unknown, fixed
or contingent, and whether asserted or not, that Releasing Parties may have had,
may now have or may hereafter acquire with respect to any matters whatsoever
relating to any actions taken or omitted by Released Parties at any time from
the beginning of the world through and including the date hereof.
(b) Individual Releases. As a material inducement for Seller to enter into
this Agreement, Xxxxxxx X. Xxxxxxxx, Xxx Xxxxxxxxx and Nino Doijashvili, for
themselves and their heirs, representatives, successors and assigns, effective
as of the Closing Date, do hereby release and forever discharge, fully, finally,
irrevocably and unconditionally, the Released Parties of and from any and all
claims, charges, complaints, demands, actions, promises, liabilities,
obligations and causes of action whatsoever, whether at law or equity, whether
known or unknown, fixed or contingent, and whether asserted or not, that any of
them may have had, may now have or may hereafter acquire with respect to their
respective employment agreements, including any amendments thereto, with Seller
or otherwise arising in connection with their employment with or separation from
Seller, including, without limitation, any and all claims, grievances, causes of
action, charges or complaints that any of them has, could have, or might have
asserted under any age, race, color, sex, national origin, religion, disability,
or other discrimination law, including specifically claims under the Age
Discrimination in Employment Act, in any lawsuit or before the Equal Employment
Opportunity Commission or any other government agency, or under any other
federal or state law, statute, executive order, regulation, ordinance, decision
or rule of law.
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(c) Seller Releases. As a material inducement for Xxxxxxx X. Xxxxxxxx, Xxx
Xxxxxxxxx and Nino Doijashvili to enter into this Section 9 of this Agreement,
Seller, effective as of the Closing Date, hereby releases, for itself and its
successors and assigns, Xxxxxxx X. Xxxxxxxx, Xxx Xxxxxxxxx and Nino Doijashvili
of and from any and all claims, charges, complaints, demands, actions, promises,
liabilities, obligations and causes of action whatsoever, whether at law or
equity, whether known or unknown, fixed or contingent, and whether asserted or
not, that Seller may have had, may now have or may hereafter acquire with
respect to such persons' respective employment agreements, including any
amendments thereto, with Seller or otherwise arising in connection with their
employment with or separation from Seller; provided, however, for purposes of
clarification, that this Section 9(c) shall not serve as a release of any claim,
charge, complaint, demand, action, promise, liability, obligation or cause of
action arising out of this Agreement or any other agreement entered into in
connection with the proposed sale of the Business to Tulix pursuant to this
Agreement, or arising out of any fraud, willful misconduct, or criminal act.
SECTION 10.
CLAIMS
(a) Survival of Representations and Warranties. All of the representations
and warranties, covenants and agreements in this Agreement or in any instrument
delivered pursuant to this Agreement shall survive the Closing and continue
until the date which is the eighteen month anniversary of the Closing Date.
(b) Limitation on Claims by Purchaser. The principals of the Purchaser are
also the officers of the Seller and members of the Seller's board of directors.
The principals of the Purchaser are the parties responsible for the creation of
all schedules to this Agreement. Notwithstanding any other provision of this
Agreement, Purchaser agrees that it shall not be entitled to make any claim
against Seller based on the alleged breach by Seller of any representation or
warranty contained in this Agreement if such alleged breach relates to
information or circumstances about which the officers or employees of Purchaser
knew or should have known by virtue of the offices and positions they held at
Seller prior to Closing.
(c) Limitation on Claims. Neither party will be liable under this Agreement
for any demands, claims, actions, or causes of action, assessments, losses,
damages, liabilities, costs, or expenses, including reasonable fees and expenses
of counsel, other expenses of investigation, handling, and litigation, and
settlement amounts, together with interest and penalties (collectively, a "Loss"
or "Losses"), resulting from the breach of any representation or warranty of
such party contained in this Agreement or in any other agreement or instrument
executed and delivered by such party in connection with this Agreement, until
the aggregate amount of all such Losses exceeds $25,000 and, in that event, the
damaged party shall be entitled to recovery of all such Losses.
11
SECTION 11.
MISCELLANEOUS
(a) Acknowledgement regarding Legal Counsel. Purchaser acknowledges and
agrees that Xxxxxxxxxx Xxxxxx & Xxxxxxx LLP ("SAB") is acting as counsel to
Seller and is representing Seller in connection with this Agreement and the
transactions contemplated hereby and that SAB is not representing, and has not
represented, Purchaser in any respect, including any representation in
connection with this Agreement and the transactions contemplated hereby.
Purchaser further acknowledges and agrees that it has been advised to seek its
own independent legal counsel in connection with this Agreement and the
transactions contemplated hereby.
(b) Sales, Transfer and Documentary Taxes, etc. All sales and use taxes
relating to the sale and transfer of the Assets pursuant to this Agreement shall
be paid by Purchaser. Purchaser also shall pay all other federal, state and
local documentary and other transfer taxes, if any, due as a result of the
purchase, sale or transfer of the Assets in accordance herewith whether imposed
by applicable Laws on Seller or Purchaser, and Purchaser shall indemnify,
reimburse and hold harmless Seller in respect of the liability for payment of or
failure to pay any such taxes or the filing of or failure to file any reports
required in connection therewith.
(c) Entire Agreement; Assignment. This Agreement, which includes the
Schedules and the other documents, agreements, certificates and instruments
executed and delivered pursuant to or in connection with this Agreement, sets
forth the entire understanding and agreement of the parties hereto with respect
to the transactions contemplated hereby. Any and all prior or contemporaneous
negotiations, agreements, representations, warranties and understandings between
the parties regarding the subject matter hereof, whether written or oral, are
superseded in their entirety by this Agreement and shall not create any
liability on the part of either party hereto in favor of the other party, except
as otherwise expressly set forth in this Agreement. This Agreement shall not be
assigned, amended or modified except by written instrument duly executed by each
of the parties hereto; provided, however, that Purchaser may assign its rights
and obligations under this Agreement to a wholly owned subsidiary or to a
purchaser of all or substantially all of Purchaser's assets, whether by sale of
assets, sale of stock, merger or otherwise.
(d) Waiver. Any term or provision of this Agreement may be waived at any
time by the party entitled to the benefit thereof by a written instrument duly
executed by such party.
(e) Termination. This Agreement may be terminated at any time prior to
Closing only upon the written agreement of both parties.
12
(f) Notices. Any notice, request, demand, waiver, consent, approval or
other communication which is required or permitted hereunder shall be in writing
and shall be deemed given only if delivered personally or sent by facsimile, air
courier, telegram or by registered or certified mail, postage prepaid, as
follows:
If to Purchaser:
Tulix Systems, Inc.
0000 Xxxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
(000) 000-0000
(000) 000-0000 (facsimile)
Attn: Xxxxxxx X. Xxxxxxxx
If to Seller:
HomeCom Communications, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: President
(000) 000-0000
(000) 000-0000 (facsimile)
With a copy, which shall not constitute notice, to:
Xxxxxxxxxx Xxxxxx & Xxxxxxx LLP
0000 Xxxxx Xxxxx Xxxxx
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxxx, Esq.
(000) 000-0000
(000) 000-0000 (facsimile)
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communication will be deemed to have been given as of
the date so delivered, transmitted by facsimile, telegraphed, sent via air
courier, or mailed, as the case may be.
(g) Delaware Law to Govern. This Agreement shall be governed by and
interpreted and enforced in accordance with the laws of the State of Delaware,
without regard to its conflict of law principles.
(h) No Benefit to Others. The representations, warranties, covenants and
agreements contained in this Agreement are for the sole benefit of the parties
hereto and their respective successors and assigns, and nothing contained in
this Agreement or the other Purchase Agreements shall be construed as conferring
any rights on any other persons.
13
(i) Headings; Gender; Certain Definitions. All section headings contained
in this Agreement are for convenience of reference only, do not form a part of
this Agreement and shall not affect in any way the meaning or interpretation of
this Agreement. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine, or neuter, as the
context requires. Any reference to a "person" herein shall include an
individual, firm, corporation, partnership, trust, governmental authority or
body, association, unincorporated organization or any other entity. The
"knowledge" of a person shall include the current actual awareness of such
person, such person's officers charged with the responsibility for the matters
qualified by the use of the term "knowledge" and such matters as would be
revealed by a review of such person's records.
(j) Schedules. All Schedules referred to herein are incorporated herein by
reference and are intended to be and hereby are specifically made a part of this
Agreement.
(k) Severability. The invalidity or unenforceability of any provision of
this Agreement shall not invalidate or render unenforceable any other provision
of this Agreement.
(l) Counterparts. This Agreement may be executed in any number of
counterparts and either party hereto may execute any such counterpart, each of
which when executed and delivered shall be deemed to be an original and all of
which counterparts taken together shall constitute but one and the same
instrument. This Agreement shall become binding when one or more counterparts
taken together shall have been executed and delivered by the parties. It shall
not be necessary in making proof of this Agreement or any counterpart hereof to
produce or account for any of the other counterparts.
(m) Drafting of Agreement. Each party has participated in the negotiation
and preparation of this Agreement; therefore, this Agreement shall be construed
without regard to any presumption or other rule requiring construction against
the party causing the Agreement to be drafted.
(n) Time of the Essence. Time is of the essence of this Agreement.
(o) Actions and Proceedings. Each party to this Agreement consents to the
exclusive jurisdiction and venue of the state courts of the State of Delaware
and the United States District Court for any District of Delaware in any action
or judicial proceeding arising out of or relating to this Agreement
("Proceeding"). Each party consents and submits to the exclusive personal
jurisdiction of any court in the State of Delaware in respect of any such
Proceeding. Each party consents to service of process upon it with respect to
14
any such Proceeding by registered mail, return receipt requested, and by any
other means permitted by applicable Laws. Each party waives any objection that
it may now or hereafter have to the laying of venue of any such Proceeding in
any court in the State of Delaware and any claim that it may now or hereafter
have that any such Proceeding in any court in the State of Delaware has been
brought in an inconvenient forum. Each party waives its right to a trial by jury
in any such Proceeding.
(p) Execution by Facsimile. Either party may deliver an executed copy of
this Agreement and any documents contemplated hereby by facsimile transmission
to the other party, and such delivery shall have the same force and effect as
any other delivery of a manually signed copy of this Agreement or of such other
documents.
(Signatures on following pages)
15
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the date first written above:
PURCHASER:
TULIX SYSTEMS, INC.
By: /s/ Xxx Xxxxxxxxx
--------------------------------------
Name: Gia "Xxxxxx" Bokuchava
Title: CEO
SELLER:
HOMECOM COMMUNICATIONS, INC.
By: /s/ Xxxxxxx Xxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxx
--------------------------------------
Title: Vice President
--------------------------------------
FOR PURPOSES OF SECTION 9(b) ONLY:
/s/ Xxx Xxxxxxxxx
--------------------------------------
Xxx Xxxxxxxxx
/s/ Nino Doijashvili
--------------------------------------
Nino Doijashvili
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxxx
16
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 1 (a)
Intellectual Property
All right, title and interest in the "Post on the Fly", "Intelligent Advisor",
"Xxxxxx", Time Warner Road Runner Personal Home Page Application, "Community",
"On line Forum" and "Work Order System" software applications, including but not
limited to the following to the extent related thereto: (a) all source code,
specifications, technical documentation and similar information; (b) all
trademarks, service marks, trade names, logos, and domain names, together with
all goodwill associated therewith; all patents; all copyright and copyrightable
works; all intellectual property registrations and applications and renewals
therefore; and all other intellectual property rights of any kind or nature
whatsoever; and (c) all records and marketing materials relating to the
foregoing.
17
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 1 (b)
Contracts
As of 12/31/02
Client Description Period Expiration
--------------------------------------------------------------------------------
Bend Cable Monthly Hosting Services Monthly 01/31/04
Belle Chambre Monthly Hosting Services Monthly Month to Month
Bituminous Fire Monthly Hosting Services Monthly 08/31/03
Xxxxxx'x Monthly Hosting Services Monthly Month to Month
Magellan Health Monthly Hosting Services Monthly Month to Month
Merchants Monthly Hosting Services Monthly Month to Month
NCB Monthly Hosting Services Monthly Month to Month
X.X. Xxxxxx Monthly Hosting Services Monthly Month to Month
Road Runner Monthly Hosting Services Monthly Expired 12/31/01
18
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 1 (c)
Accounts Receivable
As of 12/31/02
Client Amount
--------------------------------------------------------------------------------
Road Runner 70,000.00
---------
Total 70,000.00
=========
1
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 1 (d)
Equipment
EQUIPMENT / MODEL # SERIAL #
--------------------------------------------------------------------------------
OFFICE EQUIPMENT
Toshiba 2530 CDS 49634310A
Dell Dimension 183BQ
Sony Multiscan w7000 2000353
Dell Trinitron 7047788
Viewsonic G810
XXX XXXX X.X. 00000000
XX Xxxxxxx 000XXX / C6410B SG9611W0R3
Brother Electronic Typewriter GX8250 B8D857536
Dell Trinitron Ultrascan 1000 / D1025tm 8471538
Dell Dimension T450 11LQR
Viewsonic G810 Q190775179
HP Laserjet 2100 USGX066422
ACI PIII P.C. 97200545
Viewsonic G810 QV01445958
Unisys Aquatam /DMS/6 49609557
Dell Ultrascan 20TX / D2026t-HS 2024784
Toshiba Tecra 730CDT / PA1228U 10614039
HP Laserjet 4M Plus C2039A JPGK235556
ACI PIII P.C. 97001421
Viewsonic G810 QV01344797
Dell Monitor M780 5322DE22KJ59
HP Laserjet 3100 C3948A USBG021007
Gateway 2000 P5-120 4224926
Lexmark Optra T612
QMS Magic Color Printer / QMS-MCCX21 Q0225680
Gateway 2000 Vivitron 15 / CPD15F23 8443375
HP Scanjet 4C / C2520B SG719230CV
Viewsonic G810 QV01445960
Gateway 2000 G6 6003513
XXX XXXX X.X. 00000000
XXX XX0000XXXXX
Xxxx Xxxxxxx M780 3872E808
HP Officejet 520 / C3801A US75MA21M2
Gateway 2000 / CPD-GF200 7025149
HP Pavilion 4455 / D7394A US91168277
2
Gateway 2000 Vivitron 15 / CPD15F23 8632172
Gateway 2000 X0 -000 0000000
Xxxxxxxxx G810 QV01445756
HP Deskjet 895CSE / C6410B SG91Q1V05G
XXX XXXX X.X. 00000000
Xxxxxxxxx Xxxxx XX 0000/000 XX0000XX0XX
Dell Monitor M780 0000XX00XX
Xxxxxxx 0000 Xxxxxxx Xxxx / XX0000-00 MH54H4017645
Toshiba Satelite 2530CDS / PAS253U 49629218A
Infocus / LP435Z 3EW91400111
Infocus Lite Pro 580 2AB0601787
KDS Flat Screen Monitor KLT1513A 1540SBB36004376
KDS Flat Screen Monitor KLT1711A 1763BBB34006041
KDS Flat Screen Monitor KLT1711A 1763BBB34006142
KDS Rad 5 Flat Screen 5003944900267
KDS Rad 5 Flat Screen 5003944900174
Dell Dimension CPU 4400 8S4WG11
Dell Dimension CPU 4400 5S4WG11
Nicon Collpix 5000 000-00000-0000
I-Book 700 Mhz Small Screen N/A
NOC EQUIPMENT
Dell Power Vault 130T Robotic DLT UXCXM
Xxxxxxx Xxxxxxxx XXX0 Xxxx Xxxxx / XXX00000X XX00XXX
Dell Power Edge 6350 6J8I0
Raid Web 500 Gigs External Raid No Serial#
Dell Power Edge 6350 Dual Xeon 550mhz 6J8EZ
Dell Power Edge 6350 4Xeon 550mhz 6L80I
Artecon 200 Gig External Raid 24514570296
Artecon 200 Gig External Raid 24514570320
Artecon 200 Gig External Raid 24514570326
Artecon 200 Gig External Raid 24515330067
ATL Power Store L200 DLT Auto Loader No Serial#
TeleNet Server Pentium Pro 200 TSS97060017
Dell Power Edge 2400 Dual Pentium3 550mhz 4JEDB
TeleNet Server Pentium2 333mhz TSS98040035
TeleNet Server Pentium2 300mhz TSS98040027
TeleNet Server Pentium2 266mhz TSS98050001
TeleNet Server Pentium2 266mhz TSS98030058
TeleNet Server Pentium2 400mhz TSS98030057
TeleNet Server Dual Xxxxxxx0 000xxx TSS98070082
TeleNet Server Pentium2 300mhz TSS98030005
3Com SuperStack2 Switch 7WKR101215
Gateway 2000 Pentium Pro 200mhz 7248477
Belkin OmniView No Serial#
0Xxx XxxxxXxxxx0 Xxxxxx XXXX000000
3
ADC Kentrox Data-Smart T3/E3 IDSU DDM1UZPBRA
Cisco 7200 72602314
Cisco 7200 72602346
Superstack II Dual Hub 500-0801 72BV200F84F
Cisco Catalyst 1900 00902B49C540
Cisco 3524 Catalyst 000196348D00
Sun Ultra 5 FW01950150
Dell Pentium Dimension XPS Pro 200mhz 92CW1
Dell Pentium Dimension XPS P266 FN77S
Cisco 3620 Frame Relay 362088634
96 Port Patch Panel No Serial#
Centercom 3024tr (Hub) PT3F7080E
Centercom 3024tr (Hub) F03N611BD
Prime 133mhz No Serial#
Generic Pentium Pro 200mhz H1VHGD
Quantex Pentium 120mhz 5001410090
Quantex Pentium 120mhz 5001417346
Digital Link DL3100 Digital Service Multiplexer 3096030917
Digital Link T1 DSU/CSU
Gateway 2000 PentiumII 266mhz 7252411
Power Mac 7100/80 FC5080UR44H
Gateway Pentium 100mhz 5232643
ACI Pentium III 450mhz 97001420
Belkin OmniView 6 Port No Serial#
Gateway Pentium Pro 200mhz 4224929
Gateway Pentium 120mhz 6425691
Unisys Pentium Pro 180mhz 4907791
ACI Pentium 100mhz No Serial#
Belkin OmniView 6 Port No Serial#
3Com SuperStack2 Switch 7YDB025314
0Xxx XxxxxXxxxx0 Xxxxxx 0XXX000000
Mag Innovision MI58HA022364
Belkin OmniView 0 Xxxx Xx Xxxxxx#
Xxx Xxxxxxxxxx XX00XX000000
ACI P.C. 97001422
Belkin Omniview Pro 8 Port No Serial#
Dell M780 Monitor 5322DA0727
Telnet Server TSS98030051
Dell Poweredge 4300 01V8E
Dell Dimension XPS D266 No Serial#
Dell VC5 Monitor 15001106
Sun Netra Ultra Xxxxx Xxxxx 000X0000
Sun Ultra Enterprise 450 024H2F8C
Mag Innovision / MagDX1795 018C1358
Telenet Server TSS98040034
Telenet Server TSS98070014
XXX Xxxx Xxxxx Xxxxxxxx 0000
Sun 012H26ED
CT US82321776
Gateway 2000 G6200 6986892
4
Gateway 2000 G6200 7248475
ACI PC 97200548
Gateway 2000 G6200 MI58HA022363
Belkin Omni View 6Port No Serial#
3Com SuperStack2 Switch 7A8F000301
0Xxx XxxxxXxxxx0 Xxxxxx 0XXX000000
Power PC FC6012TV3FV
Telenet Server TSS98030059
Telenet Server TSS98030060
Telenet Server TSS98070013
Gateway 2000 Vivitron / CPD-GF200 7050359
Belkin Omniview 6 Port No Serial#
Sun Ultra 1 Creator 607F04E1
Sun Ultra 1 Creator 651F0EEE
Sun Enterprise 220R 012H3098
Sparc Station 10 251F5398
Power PC XB5310L03FT
Arena II Disk Array 10180
3Com Baseline Switch 0200/7A8F004256
Monarch MCS Server w/ AMD Athlon 15370
Dell PowerEdge 4600 3VK4M11
APC Smartcell XR EP9707162693
APC Smartcell XR EP9707162695
RR Hard Drive Case
RR Hard Drive Case
Automated tape Backup
PHONE SYSTEM
Samsung DCS 50si Package w/ 6 Loop
Misc. 1 for CID, 8 Station inter (6X16) system)
SVMi-4 4 Port Voicemail Card
2 - single line ports
1 - 28 button Display Speaker Phones Falcon 28D
10 - 18 Button Display Speaker Phones Falcon 18D
UPS / BACK-UP POWER
Honda Generator (3KW)
Honda Generator (3KW)
5
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 2
Assumed Liabilities
Schedule 2 will be completed on the Closing Date and will identify all
liabilities that exist on the Closing Date that will be transferred to
Purchaser, including any and all liabilities related to accounts payable
incurred in the ordinary course of business, including past due amounts.
6
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 3(b)
Payments that Cause an Adjustment to the Guaranteed Closing Date Cash/AR
Payment Matter
1. AT&T
2. Applied Theory
3. Xxxx South
4. City of Atlanta
5. Deutsche (RSW)
6. Xxxxxxxx & Xxxx
7. FedEx
8. Sherb & Company
9. Genesys Conferencing
10. Globix
11. Xxxxxxx Springs
12. ICSA
13. JPTurner
14. Property Georgia(Lease Liability Building 14)/Xxxxxxxx Xxxxx et al.
15. Newmark & Co. (Lease Liability NY)
16. Millenia Internet
17. Newcourt
18. Nextlink
19. Oracle
20. Professional Exchange
21. Xxxxxxxxxx Xxxxxx & Xxxxxxx
22. Set Focus
23. Social Security Administration (FUTA penalty)
24. Standard & Poor's
25. Tokai (Ricoh)
26. TriState Office Products
27. World Investor Link
28. Xxxxxxxx Financial Printing
29. Xxxxxxx Xxxxxxxx
7
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 5(d)
Required Government Consents
None
8
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 5(e)
Required Contract Consents
The following contracts would need prior written consent to be transferred
to Purchaser (per Standard Terms and Conditions Paragraph 6. of their service
agreements with HOMECOM):
Bend cable Communications
Belle Chambre
Bituminous Insurance
The following suppliers would need to be transferred to Purchaser;
Automatic Systems
BSDI/Windriver
Coca Cola
Data Power Systems
Docu-Team
Genuity/Level III Communications
Oracle
Piedmont Xxx
Xxxxxx Xxxxx
Skytel
9
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 5(g)
Purchaser Capital Stock
Xxxxxxx X. Xxxxxxxx, Xxx Xxxxxxxxx and Nino Doijashvili own 100% of the
outstanding shares of common stock of Purchaser.
10
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 5(h)
Litigation
Seller Litigation:
------------------
No Litigation is pending, or, to Purchaser's best knowledge, threatened
against Seller or its subsidiaries or any of its present of former directors,
officers, or employees, affecting, involving, or relating to any of the Assets
or the Business except as listed below.
On or about February 8, 2002, Seller received a complaint filed by
Properties Georgia OBJLW One Corporation in the State Court of Xxxxxx County,
Georgia on December 6, 2001, alleging that Seller defaulted on its lease in
Building 14 at 0000 Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000. The complaint sought
damages in the amount of $141,752 plus interest of $23,827, plus attorneys' fees
and court costs. On December 18, 2002 Seller reached an out of court settlement
with Georgia OBJLW One Corporation in the amount of $135,000, consisting of one
payment of $30,000 paid at that time, followed by seven monthly payments of
$15,000 to be made from February through August, 2003.
On or about January 14, 2002, Creditors Adjustment Bureau, Inc., a
California corporation and the assignee of the claims of Siemens ICN, filed a
complaint against Seller alleging, among other things, that Seller breached its
contract with Siemens. The complaint sought damages of $18,058.08 plus interest
at a rate of 18% from January 26, 2001, plus expenses and attorneys' fees. The
complaint was filed in the Superior Court of California, County of Santa Clara,
California. On April 26, 2002, after retaining counsel and as a result of the
Company's response, the complaint was dismissed.
Purchaser Litigation:
---------------------
None
11
TULIX/HOMECOM
ASSET PURCHASE AGREEMENT
SCHEDULE 8(a)
Allocation of Purchase Price
To be determined by the Purchaser at its reasonable discretion, if applicable.
12
EXHIBIT 1
---------
Form of Shareholder's Agreement
TULIX SYSTEMS, INC.
SHAREHOLDER AGREEMENT
This Shareholder Agreement (the "Agreement") is made as of _______________,
2003 by and among Tulix Systems, Inc., a Georgia corporation (the "Company"),
HomeCom Communications, Inc., a Delaware corporation ("HomeCom"), and the
holders of the Company's Common Stock, $.01 par value (the "Common Stock"),
listed on Schedule 1 attached hereto (the "Founding Shareholders").
RECITALS
--------
A. HomeCom and the Company are parties to that certain Asset Purchase
Agreement, dated as of ___________, 2003 (the "Asset Purchase Agreement"),
pursuant to which HomeCom has sold to the Company, and the Company has purchased
from HomeCom, substantially all of the assets used in the operation of HomeCom's
hosting and website maintenance business in exchange for consideration that
includes, among other things, fifteen percent (15%) of the outstanding shares of
Common Stock.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the parties hereto agree as follows:
1. Certain Defined Terms. As used in this Agreement, the following terms
shall have the following respective meanings:
(a) "HomeCom Holder" shall mean HomeCom and those direct and indirect
transferees, assignees and successors of HomeCom that own shares of Common Stock
of record at the relevant time. The transferees, assignees and successors of
HomeCom that shall be considered "HomeCom Holders" for purposes of this
Agreement shall be limited to the first five (5) direct or indirect transferees,
assignees and successors of HomeCom.
(b) "Initial Public Offering" shall mean the closing of the sale of
the Company's Common Stock in a firm commitment, underwritten public offering
registered under the Securities Act of 1933, as amended, (other than a
registration relating solely to a transaction under Rule 145 under such Act or
any successor thereto) or to an employee benefit plan of the Company.
(c) "Securities" shall mean and include all shares of capital stock of
the Company, any shares of capital stock of the Company or another entity that
may be issued in exchange for or in respect of shares of capital stock of the
Company (whether pursuant to stock split, stock dividend, combination,
reclassification, reorganization, or any other means), and any right or
instrument that contains any feature, conditional or otherwise, whereby any
shares of such capital stock of the Company may be obtained.
(d) "Shareholders" shall mean the HomeCom Holders and the Founding
Shareholders.
(e) "Shareholder's Pro Rata Percentage" shall mean, at any time, that
percentage calculated by dividing the number of shares of Common Stock held by a
Shareholder by the aggregate number of shares of Common Stock held by all
Shareholders at such time.
(f) "Shares" shall mean and include all Securities now owned or
hereafter acquired by the Shareholders.
2. Right of First Offer.
(a) General. Subject to the terms and conditions specified in this
Section 2, the Company hereby grants to the Shareholders a right of first offer
with respect to future sales by the Company of its Securities ("Later
Securities"). A Shareholder who chooses to exercise the right of first offer may
designate as purchasers under such right itself or its affiliates in such
proportions as it deems appropriate.
(b) Mechanics. Each time the Company proposes to offer any Later
Securities, the Company shall first make an offering of such Later Securities to
the Shareholders in accordance with the following provisions:
(i) The Company shall give written notice ("Offer Notice") to
each Shareholder stating (A) its bona fide intention to offer such Later
Securities, (B) the number of such Later Securities to be offered, (C) the price
and terms, if any, upon which it proposes to offer such Later Securities, and
(D) such Shareholder's respective Shareholder's Pro Rata Percentage.
(ii) Within twenty (20) calendar days after receipt of the Offer
Notice, each Shareholder may elect, by written notice to the Company (the "Reply
Notice"), to purchase or obtain, at the price and on the terms specified in the
Offer Notice, up to that number of such Later Securities determined by
multiplying such Shareholder's Pro Rata Percentage by the total number of Later
Securities specified in the Offer Notice. The Company shall sell to each
Shareholder the number of Later Securities specified in each Shareholder's Reply
Notice promptly following receipt of such Reply Notice.
(iii) In the event that some Shareholders do not elect to fully
subscribe for any Later Securities during the period specified in Section
2(b)(ii) above, the Company shall deliver, promptly upon the expiration of the
period specified in Section 2(b)(ii) above, a notice (the "Second Offer Notice")
to the Shareholders who have elected to purchase Later Securities in accordance
with the provisions of Section 2(b)(ii) (the "Subscribing Shareholders"), which
Second Offer Notice shall state (A) the number of unsubscribed Later Securities
and (B) the number of such unsubscribed Later Securities that each Subscribing
Shareholder is entitled to purchase, which number shall be calculated for each
Subscribing Shareholder by multiplying the number of unsubscribed Later
2
Securities by a fraction, the numerator of which is the number of Later
Securities for which such Subscribing Shareholder subscribed pursuant to Section
2(b)(ii) above and the denominator of which is the total number of Later
Securities for which all Subscribing Shareholders subscribed pursuant to Section
2(b)(ii) above. Within ten (10) calendar days after receipt of the Second Offer
Notice, each Subscribing Shareholder shall give written notice to the Company
specifying the number of unsubscribed Later Securities that such Subscribing
Shareholder elects to purchase, and the Company shall sell such number of Later
Securities to such Subscribing Shareholder promptly after receipt of such
notice.
(c) The Company may, during the ninety (90) calendar day period
following the expiration of both of the periods referenced in subsections
2(b)(ii) and 2(b)(iii) hereof, offer the remaining unsubscribed portion of the
Later Securities to any person or persons at a price not less than, and upon
terms no more favorable to the offeree than, those specified in the Offer
Notice. If the Company does not enter into an agreement for the sale of the
Later Securities within such period, or if such agreement is not consummated
within ninety (90) calendar days of the execution thereof, the right provided
hereunder shall be deemed to be revived and such Later Securities shall not be
offered unless first reoffered to the Shareholders in accordance herewith.
(d) The right of first offer granted pursuant to this Section 2 shall
not apply to the issuance of any Exempt Securities, as that term is defined in
Section 4(b) below.
3. Right of Co-Sale.
(a) The Shareholders shall not sell, assign, transfer, pledge,
hypothecate, mortgage, encumber or dispose of all or any of their Shares except
to the other Shareholders, to the Company or as expressly provided in this
Agreement.
(b) Notwithstanding the foregoing paragraph (a), each Shareholder may
transfer all or any of its Shares on one or more occasions (i) by way of gift to
any member(s) of his family or to any trust or custodianship for the benefit of
any such family member(s) or the Shareholder, provided that any such transferee
shall agree in writing with the Company and the Shareholders, as a condition to
such transfer, to be bound by all of the provisions of this Agreement to the
same extent as if such transferee were a Shareholder (unless such transferee is
a transferee of HomeCom not entitled to rights as a HomeCom Holder pursuant to
Section 1(a)), (ii) by will or the laws of descent and distribution, in which
event each such transferee shall be bound by all of the provisions of this
Agreement to the same extent as if such transferee were a Shareholder (unless
such transferee is a transferee of HomeCom not entitled to rights as a HomeCom
Holder pursuant to Section 1(a)), or (iii) by pledge of the Shares to any lender
or creditor, provided that the restrictions set forth in Section 3 hereof shall
apply in connection with any sale of such Shares upon foreclosure or acceptance
of such Shares in lieu of foreclosure, or (iv) if the transferring Shareholder
is a HomeCom Holder, by transfer of any or all of such HomeCom Holder's Shares
on one or more occasions to a person that is, or upon completion of such
transfer will be, a HomeCom Holder, provided that each HomeCom Holder shall be
bound by all the provisions of this Agreement. As used herein, the word "family"
shall include any spouse, lineal ancestor or descendant (natural or adopted),
brother or sister, or their spouses.
3
(c) If at any time a Shareholder (a "Selling Shareholder") desires to
sell all or any part of the Shares owned by him (the "Selling Shareholder
Shares") to any person or entity other than one or more of the other
Shareholders (the "Purchaser") and other than pursuant to Section 3(b) above (an
"Offer"), such Selling Shareholder shall give written notice of such proposed
sale or transfer to all of the Shareholders (the "Co-Sale Notice"), which
Co-Sale Notice shall identify the Purchaser and specify the number of Selling
Shareholder Shares, the price and the payment terms of the proposed sale. Each
of the other Shareholders shall have the right to sell to the Purchaser, as a
condition to such sale by the Selling Shareholder, at the same price per share
and on the same terms and conditions as involved in such sale by the Selling
Shareholder, a number of Shares calculated by multiplying (i) the total number
of Selling Shareholder Shares by (ii) such Shareholder's respective
Shareholder's Pro Rata Percentage.
(d) Each Shareholder wishing to so participate in any sale under this
Section 3 (a "Participating Shareholder") shall notify the Selling Shareholder
in writing of such intention as soon as practicable after such Shareholder's
receipt of the Co-Sale Notice delivered pursuant to Section 3(c), and in any
event within twenty (20) calendar days after the date of receipt of such Co-Sale
Notice from the Selling Shareholder, with such Participating Shareholder's
notice to specify the number of Shares to be sold by the Participating
Shareholder.
(e) In the event that some Shareholders do not elect to fully
participate in the Offer during the period specified in Section 3(d) above, the
Selling Shareholder shall deliver a notice (the "Second Co-Sale Notice") to the
Participating Shareholders, which Second Co-Sale Notice shall state (A) the
aggregate number of Shares that the Shareholders were eligible to sell pursuant
to Section 3(c) but did not elect to sell (the "Unsold Shares") and (B) the
number of Unsold Shares that each Participating Holder is entitled to sell to
Purchaser, which number shall be calculated by multiplying the number of Unsold
Shares by a fraction, the numerator of which is the number of Shares that each
Participating Shareholder elected to sell to Purchaser pursuant to Section 3(d)
above and the denominator of which is the aggregate number of Shares that all
Participating Shareholders elected to sell to Purchaser pursuant to Section 3(d)
above. Within ten (10) calendar days after receipt of the Second Co-Sale Notice,
each Participating Shareholder shall give written notice to the Company
specifying the number of Unsold Shares that such Participating Shareholder
elects to sell to Purchaser.
(f) Following the expiration of both of the periods referred to in
Section 3(d) and Section 3(e), or at such earlier time as the Selling
Shareholder, the Participating Shareholders and the Purchaser may agree upon,
the Selling Shareholder and each Participating Shareholder shall sell to the
Purchaser all or, at the option of the Purchaser, any part of the Shares
proposed to be sold by them at not less than the price and upon other terms and
conditions, if any, not more favorable to the Purchaser than those in the Offer
provided by the Selling Shareholder under Section 3 above; provided, however,
that any purchase of less than all of such Shares by the Purchaser shall be made
from the Selling Shareholder and each Participating Shareholder pro rata based
upon the relative amount of the Shares that the Selling Shareholder and each
Participating Shareholder had decided to sell after complying with Section 3(c),
Section 3(d) and Section 3(e).
4
(g) Any Shares sold by a Shareholder to a Purchaser pursuant to this
Section 3, other than Shares transferred pursuant to Section 3(b), shall no
longer be subject to the restrictions imposed by this Agreement and shall no
longer be entitled to the benefits conferred by this Agreement.
4. Anti-Dilution Protection.
(a) In the event that the Company shall, at any time or from time to
time after the date hereof, sell or issue any Securities (any sale or issuance
of Securities other than pursuant to clauses (i) or (ii) below being referred to
herein as a "Subsequent Issuance") other than issuances (i) of Exempt Securities
as defined in subsection (b) immediately below, or (ii) to Shareholders pursuant
to rights of first offer granted pursuant to Section 2 hereof, unless, in such
instance, the only Securities being issued pursuant to Section 2 are being
issued to Founding Shareholders, in which case the issuance of such Securities
shall be considered a Subsequent Issuance, then, upon each Subsequent Issuance,
the Company shall issue to the HomeCom Holders additional shares of Common Stock
such that the aggregate ownership interest of the HomeCom Holders shall remain
at fifteen percent (15.0%) of the outstanding shares of Common Stock, on a
fully-diluted basis. In such instances, the Company will issue to each HomeCom
Holder a number of shares of Common Stock calculated by multiplying the total
number of shares to be issued by the Company to all the HomeCom Holders by a
fraction, the numerator of which is the number of Shares held by such HomeCom
Holder and the denominator of which is the number of Shares held by all HomeCom
Holders at such time. For purposes of this Agreement, the term "fully-diluted"
shall mean the number of shares of Common Stock outstanding plus the number of
shares of Common Stock then issuable upon conversion or exercise of all
outstanding Securities.
(b) Exempt Securities. The following issuances of Securities ("Exempt
Securities") shall not be a considered Subsequent Issuances for purposes of
Section 4(a) above or issuances of Later Securities for purposes of Section 2
above: (i) the issuance or sale of Securities (and options, warrants or other
rights therefor) to employees, consultants, advisors and directors, pursuant to
plans or agreements approved by the board of directors for the primary purpose
of soliciting or retaining their services or compensating them for their
services; (ii) the issuance of Securities (and options, warrants or other rights
therefor) to customers, business partners, financial institutions or lessors in
connection with bona fide commercial credit arrangements, equipment financings,
or similar transactions for primarily other than equity financing purposes,
provided, however, that the aggregate amount of Exempted Securities issuable
pursuant to the exemptions provided by subsections (i) and (ii) above shall not
exceed the number of shares equal to eight percent (8%) of the number of shares
of Common Stock that are outstanding on the date hereof; (iii) the issuance or
sale of Securities pursuant to the consummation of an Initial Public Offering;
(iv) the issuance of Securities in connection with a bona fide business
acquisition by the Company of another business entity or technologies or
pursuant to a strategic partnership or other business transaction, combination
or relationship; (v) the issuance of securities in connection with a negotiated
"equity financing" in which the Company agrees to sell Securities to an equity
investor or a group of equity investors for cash consideration, provided,
however, that this exclusion shall not apply if a majority of Securities to be
purchased by the group of equity investors would be purchased by Founding
Shareholders; or, (vi) the issuance of Securities in connection with any stock
split, stock dividend, recapitalization, or similar transaction by the Company.
5
5. Financial Information and Inspection Rights. For so long as HomeCom
Holders continue to own at least twenty-five percent (25%) of the shares of
Common Stock issued to the HomeCom Holders on the date hereof, the Company shall
permit the HomeCom Holders, at the HomeCom Holders' expense, to visit and
inspect the Company's properties, to examine its books of account and records
and to discuss the Company's affairs, finances and accounts with its officers,
all at such reasonable times as may be requested by the HomeCom Holders;
provided, however, that the Company shall not be obligated pursuant to this
Section 5 to provide access to any information which it reasonably considers to
be a trade secret or similar confidential information and provided, further,
that the HomeCom Holders shall not be entitled to exercise the inspection rights
granted pursuant to this Section 5 more than two times per year. In addition,
the Company shall provide to the HomeCom Holders, upon the written request of
any HomeCom Holder, with copies of the Company's unaudited financial statements,
including a balance sheet, an income statement, and a statement of cash flows
(the "Financial Statements"); provided, however, that the Company shall be
obligated to provide the Financial Statements to the HomeCom Holders not more
than two times per year.
6. Term. This Agreement shall terminate (a) upon the mutual agreement of
the HomeCom Holders and the Founding Shareholders or (b) the fifth anniversary
of the date of this Agreement, whichever occurs first.
7. Specific Enforcement. The parties expressly agree that the HomeCom
Holders will be irreparably damaged if this Agreement is not specifically
enforced. Upon a breach or threatened breach of the terms, covenants and/or
conditions of this Agreement by the Company or any Shareholder, the HomeCom
Holders shall, in addition to all other remedies, be entitled to a temporary or
permanent injunction, without showing any actual damage, and/or a decree for
specific performance, in accordance with the provisions hereof.
8. Legend. Each certificate evidencing the Shares of the Shareholders shall
bear a legend substantially as follows:
"The shares represented by this certificate are subject to restrictions on
transfer and may not be sold, exchanged, transferred, pledged, hypothecated
or otherwise disposed of except in accordance with and subject to all the
terms and conditions of a certain Shareholder Agreement dated as of
__________, 2003, a copy of which the Company will furnish to the holder of
this certificate upon request and without charge."
9. Notices. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given only if delivered personally or sent by facsimile, air
courier, telegram or by registered or certified mail, postage prepaid, as
follows:
6
If to the Company:
Tulix Systems, Inc.
0000 Xxxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
(000) 000-0000
(000) 000-0000 (facsimile)
Attn: Xxxxxxx X. Xxxxxxxx
If to HomeCom:
HomeCom Communications, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: President
(000) 000-0000
(000) 000-0000 (facsimile)
With a copy, which shall not constitute notice, to:
Xxxxxxxxxx Xxxxxx & Xxxxxxx XXX
Xxxxx Xxxxx Xxxxx, Xxxxx 0000
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxxx, Esq.
(000) 000-0000
(000) 000-0000 (facsimile)
or to such other address as the addressee may have specified on the signature
pages hereto or in a notice duly given to the sender as provided herein. Such
notice, request, demand, waiver, consent, approval or other communication will
be deemed to have been given as of the date so delivered, transmitted by
facsimile, telegraphed, sent via air courier, or mailed, as the case may be.
10. Entire Agreement and Amendments. This Agreement and the Asset Purchase
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and neither this Agreement nor any provision hereof may be
waived, modified, amended or terminated except by a written agreement signed by
the parties hereto; provided, however, that HomeCom Holders owning more than 50%
of the shares then owned by all HomeCom Holders may effect any such waiver,
modification, amendment or termination on behalf of all of the HomeCom Holders.
11. Governing Law; Successors and Assigns. This Agreement shall be governed
by the laws of the State of Delaware, without regard to the principles of
conflicts of law thereof. Except as otherwise provided herein, the obligations
of the Shareholders hereunder shall be binding upon their heirs, personal
7
representatives, executors, administrators, successors and assigns. This
Agreement shall inure to the benefit of and be binding upon the HomeCom Holders,
and any transferee thereof who is identified to the Company as a partner,
shareholder or affiliate of a HomeCom Holder. Each of the parties consents to
the exclusive jurisdiction of the federal or state courts in the State of
Delaware in connection with any dispute arising under this Agreement and hereby
waives, to the maximum extent permitted by law, any objection, including any
objection based on forum non conveniens, to the bringing of any such proceeding
in such jurisdiction. Each party hereto waives its right to trial by jury in any
such proceeding.
12. Waivers. No waiver of any breach or default hereunder shall be
considered valid unless in writing, and no such waiver shall be deemed a waiver
of any subsequent breach or default of the same or similar nature.
13. Severability. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
14. Captions. Captions are for convenience only and are not deemed to be
part of this Agreement.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[The remainder of this page has been left blank intentionally.]
8
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
TULIX SYSTEMS, INC., a Georgia corporation
By:
------------------------------------------------
Xxx Xxxxxxxxx, President and
Chief Executive Officer
HOMECOM COMMUNICATIONS, INC., a Delaware corporation
By:
------------------------------------------------
Name:
------------------------------------------------
Title:
------------------------------------------------
FOUNDING SHAREHOLDERS:
------------------------------------------------
Xxx Xxxxxxxxx
Address:
------------------------------------------------
------------------------------------------------
------------------------------------------------
------------------------------------------------
Nino Doijashvili
Address:
------------------------------------------------
------------------------------------------------
------------------------------------------------
------------------------------------------------
Xxxxxxx X. Xxxxxxxx
Address:
------------------------------------------------
------------------------------------------------
------------------------------------------------
9
Schedule I
Founding Shareholders
Xxx Xxxxxxxxx
Nino Doijashvili
Xxxxxxx X. Xxxxxxxx
10
EXHIBIT 2
---------
Form of Secured Promissory Note
SECURED PROMISSORY NOTE
-----------------------
[$70,000.00] __________, 2003
FOR VALUE RECEIVED, the undersigned, Tulix Systems, Inc., a Georgia
corporation ("Maker"), promises to pay to the order of HomeCom Communications,
Inc., a Delaware corporation ("Payee"; Payee and any subsequent holder[s] hereof
are hereinafter referred to collectively as "Holder"), at the office of Payee at
____________________________, or at such other place as Holder may designate to
Maker in writing from time to time, the principal sum of [SEVENTY THOUSAND AND
NO/100THS DOLLARS ($70,000.00)].
The principal amount hereof shall be due and payable on ________ ____, 2004
(the "Maturity Date"). [Insert date that is one year after the Closing Date]
Interest on the outstanding unpaid principal amount hereof shall accrue at
the rate of seven percent (7.0%) per annum (computed on the basis of a 360-day
year), beginning on the date hereof, and shall be due and payable on the
Maturity Date.
The indebtedness evidenced hereby may be prepaid in whole or in part, at
any time and from time to time, without premium or penalty. Any such prepayments
shall be credited first to any accrued and unpaid interest and then to the
outstanding principal balance hereof.
Time is of the essence of this Note. This Note is secured pursuant to the
terms of that certain Security Agreement, of even date herewith, between Maker
and Payee, as amended, supplemented or restated from time to time (the "Security
Agreement"). It is hereby expressly agreed that in the event that any Event of
Default shall occur under and as defined in the Security Agreement, which Event
of Default is not cured following the giving of any applicable notice and within
any applicable cure period set forth in the Security Agreement, then, and in
such event, the entire outstanding principal balance of the indebtedness
evidenced hereby, together with any other sums advanced hereunder, under the
Security Agreement and/or under any other instrument or document now or
hereafter evidencing, securing or in any way relating to the indebtedness
evidenced hereby, together with all unpaid interest accrued thereon, shall, at
the option of Holder and without notice to Maker, at once become due and payable
and may be collected forthwith, regardless of the stipulated date of maturity.
Upon the occurrence of any Event of Default as set forth herein and during any
period that Maker shall have failed to make payment of any principal or interest
due hereunder, at the option of Holder and without notice to Maker, all accrued
and unpaid interest, if any, shall be added to the outstanding principal balance
hereof, and the entire outstanding principal balance, as so adjusted, shall bear
interest thereafter until paid at an annual rate (the "Default Rate") equal to
the lesser of (i) the rate that is seven percentage points (7.0%) in excess of
the above-specified interest rate, or (ii) the maximum rate of interest allowed
to be charged under applicable law (the "Maximum Rate"), regardless of whether
or not there has been an acceleration of the payment of principal as set forth
herein. All such interest shall be paid at the time of and as a condition
precedent to the curing of any such Event of Default.
In the event this Note is placed in the hands of an attorney for
collection, or if Holder incurs any costs incident to the collection of the
indebtedness evidenced hereby, Maker and any endorsers hereof agree to pay to
Holder an amount equal to all such costs, including without limitation all
reasonable attorneys' fees and all court costs.
Presentment for payment, demand, protest and notice of demand, protest and
nonpayment are hereby waived by Maker and all other parties hereto. No failure
to accelerate the indebtedness evidenced hereby by reason of an Event of Default
hereunder, acceptance of a past-due installment or other indulgences granted
from time to time, shall be construed as a novation of this Note or as a waiver
of such right of acceleration or of the right of Holder thereafter to insist
upon strict compliance with the terms of this Note or to prevent the exercise of
such right of acceleration or any other right granted hereunder or by applicable
law. No extension of the time for payment of the indebtedness evidenced hereby
or any installment due hereunder, made by agreement with any person now or
hereafter liable for payment of the indebtedness evidenced hereby, shall operate
to release, discharge, modify, change or affect the original liability of Maker
hereunder or that of any other person now or hereafter liable for payment of the
indebtedness evidenced hereby, either in whole or in part, unless Holder agrees
otherwise in writing. This Note may not be changed orally, but only by an
agreement in writing signed by the party against whom enforcement of any waiver,
change, modification or discharge is sought.
The indebtedness and other obligations evidenced by this Note are further
evidenced by (i) that certain Asset Purchase Agreement, dated as of March ___,
2003, by and between Maker and Payee, (ii) the Security Agreement and (iii)
certain other instruments and documents, as may be required to protect and
preserve the rights of Maker and Payee, as more specifically described in the
Security Agreement.
All agreements herein made are expressly limited so that in no event
whatsoever, whether by reason of advancement of proceeds hereof, acceleration of
maturity of the unpaid balance hereof or otherwise, shall the amount paid or
agreed to be paid to Holder for the use of the money advanced or to be advanced
hereunder exceed the Maximum Rate. If, from any circumstances whatsoever, the
fulfillment of any provision of this Note or any other agreement or instrument
now or hereafter evidencing, securing or in any way relating to the indebtedness
evidenced hereby shall involve the payment of interest in excess of the Maximum
Rate, then, ipso facto, the obligation to pay interest hereunder shall be
reduced to the Maximum Rate; and if from any circumstance whatsoever, Holder
shall ever receive interest, the amount of which would exceed the amount
collectible at the Maximum Rate, such amount as would be excessive interest
shall be applied to the reduction of the principal balance remaining unpaid
hereunder and not to the payment of interest. This provision shall control every
other provision in any and all other agreements and instruments existing or
hereafter arising between Maker and Holder with respect to the indebtedness
evidenced hereby.
2
This Note is intended as a contract under and shall be construed and
enforceable in accordance with the laws of the State of Delaware, except to the
extent that federal law may be applicable to the determination of the Maximum
Rate. Whenever possible, each provision of this Note shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Note shall be prohibited by or invalid under applicable law,
such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.
Maker hereby irrevocably consents to the jurisdiction of the United States
District Court and of all state courts sitting in New Castle County, Delaware,
for the purpose of any litigation to which Holder may be a party and which
concerns this Note or the indebtedness evidenced hereby. It is further agreed
that venue for any such action shall lie exclusively with courts sitting in New
Castle County, Delaware, unless Holder agrees to the contrary in writing.
HOLDER AND MAKER HEREBY KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF
COUNSEL WAIVE TRIAL BY JURY IN ANY ACTIONS, PROCEEDINGS, CLAIMS OR
COUNTERCLAIMS, WHETHER IN CONTRACT OR TORT OR OTHERWISE, AT LAW OR IN EQUITY,
ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT.
As used herein, the terms "Maker" and "Holder" shall be deemed to include
their respective successors, legal representatives and assigns, whether by
voluntary action of the parties or by operation of law.
IN WITNESS WHEREOF, Maker, on the day and year first above written, has
caused this Note to be executed under seal.
MAKER:
TULIX SYSTEMS, INC.,
a Georgia corporation
By:
------------------------------------
Title:
------------------------------------
[CORPORATE SEAL]
3
EXHIBIT 3
---------
Form of Security Agreement
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement") is dated as of _________ ___,
2003, between Tulix Systems, Inc., a Georgia corporation ("Debtor"), and HomeCom
Communications, Inc., a Delaware corporation ("HomeCom").
SECTION 1. Definitions
1.1 Certain Defined Terms. Terms defined in the APA (as defined below) and
not otherwise defined herein shall have the respective meanings provided for in
the APA. The following terms shall have the respective meanings provided for in
the UCC (as defined below): "Accounts," "Chattel Paper," "Commercial Tort
Claim," "Documents," "General Intangibles," "Goods," "Instruments," "Inventory,"
"Letter of Credit Rights," "Proceeds," and "Supporting Obligations." The
following terms, as used herein, shall have the meanings set forth below:
"APA" means that certain Asset Purchase Agreement, dated as of March ___,
2003, between Debtor and HomeCom, as the same may be amended from time to time,
and any document required by the APA to be delivered by Debtor in connection
with the APA or the closing of the transactions contemplated therein.
"Business" means Seller's business of developing and hosting Internet
applications, products and services to commercial customers, the assets of which
business are being transferred to Debtor pursuant to the APA.
"Event of Default" means (a) the Debtor fails to timely perform any of its
duties or obligations as specified in this Agreement or the Note in accordance
with their respective terms, (b) the breach of any representation or warranty
made by Debtor in this Agreement or the Note, (c) the breach of or failure to
perform or observe any covenant or agreement contained in this Agreement or the
Note, (d) the existence of any default under this Agreement or the Note, (e) the
Debtor shall generally not pay its debts as such debts become due, or admit in
writing its inability to pay its debts generally, or make a general assignment
for the benefit of creditors, (f) any proceeding is instituted by or against the
Debtor seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debt under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking the entry of an order for relief
or for any substantial part of its property, or (g) the Debtor is liquidated or
dissolved.
"Note" means one or more Secured Promissory Note(s), in the aggregated
principal amount of [$70,000], dated on or after the date hereof, by Debtor in
favor of HomeCom, referencing this Agreement, and all amendments and supplements
thereto, restatements thereof and renewals, extensions, restructurings and
refinancings thereof.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts, business
trusts or other organizations, whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Security Interests" means the security interests granted pursuant to
Section 2, as well as all other security interests created or assigned as
additional security for the Secured Obligations pursuant to the provisions of
this Agreement.
"Secured Party" means HomeCom and its successors and assigns.
"UCC" means the Uniform Commercial Code as in effect on the date hereof in
the State of Georgia and Delaware, provided that if by reason of mandatory
provisions of law, the perfection or the effect of perfection or non-perfection
of the Security Interest in any Collateral or the availability of any remedy
hereunder is governed by the Uniform Commercial Code as in effect on or after
the date hereof in any other jurisdiction, "UCC" means the Uniform Commercial
Code as in effect in such other jurisdiction for purposes of the provisions
hereof relating to such perfection or effect of perfection or non-perfection or
availability of such remedy.
1.2 Other Definition Provisions. Any of the terms defined in Subsection 1.1
may, unless the context otherwise requires, be used in the singular or the
plural depending on the reference. All references to statutes and related
regulations shall include (unless otherwise specifically provided herein) any
amendments of same and any successor statutes and regulations. Capitalized terms
used herein which are not specifically defined shall have the meaning given such
terms in the Note (as defined below).
SECTION 2. Grant of Security Interests
In order to secure the payment and performance of the Secured Obligations
(as defined below) in accordance with the terms thereof, Debtor hereby grants to
Secured Party a continuing security interest in and to all right, title and
interest of Debtor in the following property, whether now owned or existing or
hereafter acquired or arising and regardless of where located (all being
collectively referred to as the "Collateral"):
(a) the intellectual property identified on Schedule 2(a) (the
"Intellectual Property");
(b) the contracts identified on Schedule 2(b) (the "Contracts"),
including any Accounts, General Intangibles, Chattel Paper, Documents,
Instruments, Commercial Tort Claims, Letter-of-Credit Rights, and Supporting
Obligations ancillary to, arising in any way in connection with, or otherwise
relating to any of the Contracts, and including all Inventory or other Goods
(including retained or repossessed Inventory or Goods), if any, sold to
customers pursuant to the Contracts, and all insurance contracts with respect
thereto;
(c) the accounts receivable identified on Schedule 2(c) (the "Accounts
Receivable");
2
(d) the equipment being used as of the date hereof to service and
maintain the Contracts and operate the Business and, in addition, the equipment
identified on Schedule 2(d) (the "Equipment");
(e) any Documents, Instruments or other receipts covering, evidencing
or representing any of the assets identified in subparts (a) through (d) above;
(f) all books, records, ledger cards, files, correspondence, computer
programs, tapes, disks and related data processing software that at any time
evidence or contain information relating to any of the property described in
subparts (a) - (e) above or are otherwise necessary or helpful in the collection
thereof or realization thereon; and
(g) Proceeds of all or any of the property described in subparts (a) -
(f) above.
SECTION 3. Security for Obligations
This Agreement secures the payment and performance of the Note, and all
renewals, extensions, amendments, restructurings and refinancings thereof (the
"Secured Obligations").
SECTION 4. Debtor Remains Liable
Anything herein to the contrary notwithstanding: (a) Debtor shall remain
liable under the contracts and agreements included in the Collateral to the
extent set forth therein to perform all of its duties and obligations thereunder
to the same extent as if this Agreement had not been executed; (b) the exercise
by Secured Party of any of the rights hereunder shall not release Debtor from
any of its duties or obligations under the contracts and agreements included in
the Collateral; and (c) Secured Party shall not have any obligation or liability
under the contracts and agreements included in the Collateral by reason of this
Agreement, nor shall Secured Party be obligated to perform any of the
obligations or duties of Debtor thereunder or to take any action to collect or
enforce any claim for payment assigned hereunder.
SECTION 5. Representations, Warranties and Covenants
Debtor represents, warrants and covenants as follows:
5.1 Corporate Existence and Authority. The Debtor is duly organized,
validly existing and in good standing in the State of Georgia and in every other
state in which the nature of its business in such state requires it to be so
qualified. It is duly authorized to execute and deliver this Agreement. None of
the provisions of this Agreement violate or are in conflict with any provisions
of the Debtor's Articles of Incorporation, as amended, Bylaws, as amended, or
any existing agreement, court order or consent decree to which the Debtor is a
party or may be bound. The Debtor has taken all necessary action to authorize
the granting of the security interest pursuant to this Agreement and the
delivery of any instruments as may be required under this Agreement.
3
5.2 Binding Obligation. This Agreement is the legally valid and binding
obligation of Debtor, enforceable against Debtor in accordance with its terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, or similar laws or equitable principles relating to or limiting
creditor's rights generally.
5.3 Payment of Indebtedness. The Debtor will pay or perform the Secured
Obligations as and when they become due, payable and performable in accordance
with the terms of such indebtedness and this Agreement.
5.4 Place of Business. Except as permitted with the prior consent of the
Secured Parties, the Collateral will be kept at 0000 Xxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxx 00000 (the "Premises"). The Debtor will not remove the
Collateral from the Premises (other than the removal of such Collateral in the
ordinary course of the Debtor's business) without the prior consent of the
Secured Parties. The Debtor will immediately give written notice to Secured
Party of any change in its chief executive office or principal place of
business. Debtor does not do business under any corporate name, trade name or
fictitious business name except for Debtor's corporate name on the date hereof.
Debtor will notify Secured Party promptly in writing at least 30 days prior to
(a) any change in Debtor's name, identity, mailing address, jurisdiction of
organization or corporate structure and (b) Debtor's commencing the use of any
trade name, assumed name or fictitious name.
5.5 No Liens or Financing Statements. The Debtor has, or will acquire, full
and clear right, title and interest to the Collateral and will at all times keep
the Collateral free from any adverse lien, security interest or encumbrance
other than Permitted Liens. No financing statements covering all or any portion
of the Collateral is on file in any public office, except with respect to
Permitted Liens. For purposes of this Agreement, "Permitted Liens" shall mean
those liens, encumbrances or security interests that are specified on Exhibit A.
5.6 Perfection. This Agreement, together with the UCC filings referenced
herein, create to secure the Secured Obligations a valid, perfected and first
priority security interest in the Collateral and all filings and other actions
necessary or desirable to perfect and protect such security interest have been
duly taken.
5.7 Restrictions. The Debtor will deliver or cause to be delivered such
documents as the Secured Parties may reasonably request to secure the
indebtedness, obligations and liabilities referred to in this Agreement
including, without limitation, any continuation statements, a copy of the source
code listing for the complete and current version of Debtor's program code for
each of Debtor's software products included in the Collateral for the purpose of
complying with U.S. Copyright Office deposit requirements in connection with
registering (i) Debtor's claims of copyright ownership in and to each such
software product with the U.S. Copyright Office and (ii) security interest in
and to each software related product copyright rights and copyright registration
related to the Collateral.
5.8 No Transfer of Collateral. The Debtor will not sell or offer to sell or
otherwise transfer all or any part of the Collateral (other than sales in the
ordinary course of business) without the prior consent of the Secured Party.
4
5.9 Books and Records; Inspection Rights. The Debtor will at all times
maintain accurate and complete books and records with respect to the Collateral.
A representative of Secured Party may inspect, audit and make copies of those
books and records and any other data relating to the Collateral, at such
reasonable times and places as such representative shall determine. In addition,
a representative of Secured Party may inspect the Collateral at such times and
places as such representative shall determine, and for that purpose may enter
upon or into the Premises.
5.10 Accurate Information. All information heretofore, herein or hereafter
supplied to Secured Party by or on behalf of Debtor with respect to the
Collateral is and will be accurate and complete in all material respects.
SECTION 6. Further Assurances
6.1 Other Documents and Actions. Debtor will, from time to time, at Secured
Party's expense, promptly execute and deliver all further instruments and
documents and take all further action that may be necessary or desirable, or
that Secured Party may reasonably request, in order to perfect and protect any
security interest granted or purported to be granted hereby or to enable Secured
Party to exercise and enforce its rights and remedies hereunder with respect to
any Collateral. Without limiting the generality of the foregoing, Debtor will
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as Secured Party may reasonably request, in order to perfect and
preserve the security interests granted or purported to be granted hereby.
6.2 Secured Party Authorized. Debtor hereby authorizes Secured Party at any
time and from time to time to file in any filing office in any Uniform
Commercial Code jurisdiction any initial financing statements and amendments
thereto that (a) indicate the Collateral, and (b) contain any other information
required by part 5 of Article 9 of the UCC for the sufficiency or filing office
acceptance of any financing statement or amendment, including whether Debtor is
an organization, the type of organization and any organizational identification
number issued to Debtor. Debtor agrees to furnish any such information to
Secured Party promptly upon request. Debtor also ratifies its authorization for
Secured Party to have filed in any Uniform Commercial Code jurisdiction any like
initial financing statements or amendments thereto if filed prior to the date
hereof.
SECTION 7. Remedies
(a) If any Event of Default shall have occurred and be continuing,
Secured Party may exercise in respect of the Collateral, in addition to all
other rights and remedies provided for herein or otherwise available to it, all
the rights and remedies of a secured party on default under the UCC (whether or
not the UCC applies to the affected Collateral).
5
(b) Assembly of Collateral. Upon the occurrence of and during the
continuance of an Event of Default, the Secured Party may require Debtor, at
Debtor's expense, to promptly assemble all or part of the Collateral and make it
available to the Secured Party at a place to be designated by the Secured Party
that is reasonably convenient to all parties. Upon the occurrence of and during
the continuance of an Event of Default, the Secured Party may occupy any
premises owned or leased by Debtor where the Collateral or any part thereof is
assembled for a reasonable period in order to effectuate its rights and remedies
hereunder or under law, without obligation to Debtor in respect of such
occupation.
(c) Sale of Collateral. Upon the occurrence of an Event of Default,
the Secured Party may sell all or part of the Collateral at public or private
sale, at any of Debtor's offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Secured Party may deem commercially
reasonable. Debtor agrees that to the extent permitted by law such sales may be
made without notice. If notice is required by law, Debtor hereby deems 20-days
advance notice of the time and place of any public sale or the time after which
any private sale is to be made reasonable notification, recognizing that if the
Collateral threatens to decline speedily in value or is of a type customarily
sold on a recognized market, shorter notice may be reasonable. The Secured Party
shall not be obligated to make any sale of Collateral pursuant to this Section
regardless of notice of sale having been given. The Secured Party may adjourn
any public or private sale from time-to-time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(d) Contract Rights. Upon the occurrence of and during the continuance
of an Event of Default, the Secured Party may exercise any rights and remedies
of Debtor under or in connection with the instruments, chattel paper or
contracts which represent the Contracts, the Accounts Receivable, the
Intellectual Property or otherwise relate to the Collateral, including, without
limitation, any rights of Debtor to demand or otherwise require payment of any
amount under, or performance of any provisions of, the instruments, chattel
paper or contracts which represent the Contracts, Accounts Receivable or the
Intellectual Property.
(e) Upon the occurrence of and during the continuance of an Event of
Default, the Secured Party may, or may direct Debtor to, take any action the
Secured Party deems necessary or advisable to enforce collection of the Accounts
Receivable, including, without limitation, notifying the account debtors or
obligors under any Accounts Receivable of the assignment of such Accounts
Receivable to the Secured Party and directing such account debtors or obligors
to make payment of all amounts due or to become due directly to the Secured
Party. Upon such notification and direction, and at the expense of Debtor, the
Secured Party may enforce collection of any such Accounts Receivable, and
adjust, settle or compromise the amount or payment thereof in the same manner
and to the same extent as Debtor might have done.
(f) After receipt by Debtor of the notice referred to in subsection
(e) above, in accordance with the terms thereof and so long as an Event of
Default has occurred and is continuing, all amounts and proceeds (including
instruments) received by Debtor in respect of the Accounts Receivable shall be
received in trust for the benefit of the Secured Party hereunder, shall be
segregated from other funds of Debtor, and shall promptly be paid over to the
Secured Party in the same form as so received (with any necessary endorsement)
to be held as Collateral. Debtor shall not adjust, settle or compromise the
amount or payment of any receivable, or release wholly or partly any account
debtor or obligor thereof, or allow any credit or discount thereon.
6
SECTION 8. Limitation on Duty of Secured Party with Respect to Collateral
Beyond the safe custody thereof, Secured Party shall have no duty with
respect to any Collateral in its possession or control (or in the possession or
control of any Secured Party or bailee) or with respect to any income thereon or
the preservation of rights against prior parties or any other rights pertaining
thereto. Secured Party shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if the Collateral
is accorded treatment substantially equal to that which it accords its own
property. Secured Party shall not be liable or responsible for any loss or
damage to any of the Collateral, or for any diminution in the value thereof, by
reason of the act or omission of any warehouseman, carrier, forwarding agency,
consignee or other agent or bailee selected by Secured Party in good faith.
SECTION 9. Application of Proceeds
Upon the occurrence and during the continuation of an Event of Default, the
proceeds of any sale of, or other realization upon, all or any part of the
Collateral shall be applied: first, to all fees, costs and expenses incurred by
Secured Party with respect to the Note or with respect to the Collateral; and
second, to the Secured Obligations. Secured Party shall pay over to Debtor any
surplus and Debtor shall remain liable for any deficiency.
SECTION 10. Continuing Security Interest; Transfer of Interest
This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the Secured
Obligations have been paid in full (the "Termination Date"), provided, however,
that the security interest in the Collateral created by this Agreement shall
continue after the Termination Date with respect to any Secured Obligations that
arose prior to the Termination Date, (b) be binding upon Debtor and its
permitted successors and assigns and (c) inure, together with the rights and
remedies of the Secured Party hereunder, to the benefit of the Secured Party and
its respective successors, transferees and assigns. Upon any termination of the
security interests granted hereby, all rights to the Collateral shall revert to
Debtor to the extent such Collateral shall not have been sold or otherwise
applied pursuant to the terms hereof and the Secured Party will, at Debtor's
expense, execute and deliver to Debtor such documents as Debtor shall reasonably
request and take any other actions reasonably requested to evidence or effect
such termination.
SECTION 11. Notices
Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given only if delivered personally or sent by facsimile, air
courier, telegram or by registered or certified mail, postage prepaid, as
follows:
7
If to Company:
Tulix Systems, Inc.
0000 Xxxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
(000) 000-0000
(000) 000-0000 (facsimile)
Attn: Xxxxxxx X. Xxxxxxxx
If to HomeCom
HomeCom Communications, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: President
(000) 000-0000 (000) 000-0000 (facsimile)
With a copy, which shall not constitute notice, to:
Xxxxxxxxxx Xxxxxx & Xxxxxxx XXX
Xxxxx Xxxxx Xxxxx, Xxxxx 0000
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxxx, Esq.
(000) 000-0000 (000) 000-0000 (facsimile)
or to such other address as the addressee may have specified on the signature
page hereto or in a notice duly given to the sender as provided herein. Such
notice, request, demand, waiver, consent, approval or other communication will
be deemed to have been given as of the date so delivered, transmitted by
facsimile, telegraphed, sent via air courier, or mailed, as the case may be.
SECTION 12. Waivers, Non-Exclusive Remedies, Severability
No failure on the part of Secured Party to exercise, and no delay in
exercising and no course of dealing with respect to, any power, right or
privilege under the Note or this Agreement shall operate as a waiver thereof;
nor shall any single or partial exercise by Secured Party of any such power,
right or privilege under the Note or this Agreement preclude any other or
further exercise thereof or the exercise of any other power, right or privilege.
The rights in this Agreement and the Note are cumulative and are not exclusive
of any other remedies provided by law.
The invalidity, illegality or unenforceability of any provision in or
obligation under this Agreement shall not affect or impair the validity,
legality or enforceability of the remaining provisions or obligations under this
Agreement.
8
SECTION 13. Successors and Assigns
This Agreement is for the benefit of HomeCom and its successors and
assigns, and in the event of an assignment of all or any of the Secured
Obligations, the rights hereunder, to the extent applicable to the Secured
Obligations so assigned, may be transferred with such Secured Obligations. This
Agreement shall be binding on Debtor and its successors and assigns, provided
that Debtor shall not assign this Agreement without Secured Party's prior
written consent.
SECTION 14. Changes in Writing
No amendment, modification, termination or waiver of any provision of this
Agreement or consent to any departure by Debtor therefrom, shall in any event be
effective without the written concurrence of Secured Party and Debtor.
SECTION 15. Applicable Law
This Agreement shall be governed by the laws of the State of Delaware,
without regard to the principles of conflicts of law thereof. Except as
otherwise provided, the obligations of the Shareholders hereunder shall be
binding upon their heirs, personal representatives, executors, administrators,
successors and assigns. This Agreement shall inure to the benefit of and be
binding upon the HomeCom Holders, and any transferee thereof who is identified
to the Company as a partner, shareholder or affiliate of a HomeCom Holder. Each
of the parties consents to the exclusive jurisdiction of the federal or state
courts in the State of Delaware in connection with any dispute arising under
this Agreement and hereby waives, to the maximum extent permitted by law, any
objection, including any objection based on forum non conveniens, to the
bringing of any such proceeding in such jurisdiction. Each party hereto waives
its right to trial by jury in any such proceeding.
SECTION 16. Expenses
Debtor shall pay all costs, fees and expenses of protecting, storing,
warehousing, appraising, insuring, handling, maintaining and shipping the
Collateral, all costs, fees and expenses of enforcing the Security Interests,
and any and all excise, property, sales and use taxes imposed by any federal,
state, local or foreign authority on any of the Collateral, or with respect to
periodic appraisals and inspections of the Collateral, or with respect to the
sale or other disposition thereof. All sums so paid or incurred by Secured Party
for any of the foregoing, any and all other sums for which Debtor may become
liable hereunder and all fees, costs and expenses (including attorneys' fees,
legal expenses and court costs) incurred by Secured Party in enforcing or
protecting the Security Interests or any of their rights or remedies under this
Agreement shall be payable on demand, shall constitute Secured Obligations,
shall bear interest until paid at the highest rate provided in the Note and
shall be secured by the Collateral.
SECTION 17. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument. For the purposes of executing this Agreement, (a) a
9
document signed and transmitted by facsimile or telecopier shall be treated as
an original document; (b) the signature of any party on such document shall be
considered as an original signature; (c) the document transmitted shall have the
same effect as a counterpart thereof containing original signatures; and (d) at
the request of Secured Party, Borrower, who executed this Agreement and
transmitted the signature by facsimile or telecopier, shall provide such
original signature to Secured Party. No party may raise as a defense to the
enforcement of this Agreement that a facsimile or telecopier was used to
transmit any signature of a party to the Note.
SECTION 18. Severability
It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the law and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so as not to be
invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such
jurisdiction, be so narrowly drawn, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
Witness the due execution hereof by the respective duly authorized officers
of the undersigned as of the day first above written.
DEBTOR:
TULIX SYSTEMS, INC.
By:
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
HOMECOM COMMUNICATIONS, INC.:
By:
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
10
Schedule 2(a)
Intellectual Property
All right, title and interest in the "Post on the Fly", "Intelligent Advisor",
"Xxxxxx", Time Warner Road Runner Personal Home Page Application, "Community",
"On line Forum" and "Work Order System" software applications, including but not
limited to the following to the extent related thereto: (a) all source code,
specifications, technical documentation and similar information; (b) all
trademarks, service marks, trade names, logos, and domain names, together with
all goodwill associated therewith; all patents; all copyright and copyrightable
works; all intellectual property registrations and applications and renewals
therefore; and all other intellectual property rights of any kind or nature
whatsoever; and (c) all records and marketing materials relating to the
foregoing.
11
Schedule 2(b)
Contracts
Client Description Period Expiration
--------------------------------------------------------------------------------
Bend Cable Monthly Hosting Services Monthly 01/31/04
Belle Chambre Monthly Hosting Services Monthly Month to Month
Bituminous Fire Monthly Hosting Services Monthly 08/31/03
Xxxxxx'x Monthly Hosting Services Monthly Month to Month
Magellan Health Monthly Hosting Services Monthly Month to Month
Merchants Monthly Hosting Services Monthly Month to Month
NCB Monthly Hosting Services Monthly Month to Month
X.X. Xxxxxx Monthly Hosting Services Monthly Month to Month
Road Runner Monthly Hosting Services Monthly Expired 12/31/01
12
Schedule 2(c)
Accounts Receivable
Client Amount
--------------------------------------------------------------------------------
Road Runner 70,000.00
---------
Total 70,000.00
=========
13
Schedule 2(d)
Equipment
EQUIPMENT / MODEL # SERIAL #
--------------------------------------------------------------------------------
OFFICE EQUIPMENT
Toshiba 2530 CDS 49634310A
Dell Dimension 183BQ
Sony Multiscan w7000 2000353
Dell Trinitron 7047788
Viewsonic G810
XXX XXXX X.X 00000000
XX Xxxxxxx 000XXX / C6410B SG9611W0R3
Brother Electronic Typewriter GX8250 B8D857536
Dell Trinitron Ultrascan 1000 / D1025tm 8471538
Dell Dimension T450 11LQR
Viewsonic G810 Q190775179
HP Laserjet 2100 USGX066422
ACI PIII P.C 97200545
Viewsonic G810 QV01445958
Unisys Aquatam /DMS/6 49609557
Dell Ultrascan 20TX / D2026t-HS 2024784
Toshiba Tecra 730CDT / PA1228U 10614039
HP Laserjet 4M Plus C2039A JPGK235556
ACI PIII P.C 97001421
Viewsonic G810 QV01344797
Dell Monitor M780 5322DE22KJ59
HP Laserjet 3100 C3948A USBG021007
Gateway 2000 P5-120 4224926
Lexmark Optra T612
QMS Magic Color Printer / QMS-MCCX21 Q0225680
Gateway 2000 Vivitron 15 / CPD15F23 8443375
HP Scanjet 4C / C2520B SG719230CV
Viewsonic G810 QV01445960
Gateway 2000 G6 6003513
XXX XXXX X.X 00000000
XXX XX0000XXXXX
Xxxx Xxxxxxx M780 3872E808
HP Officejet 520 / C3801A US75MA21M2
Gateway 2000 / CPD-GF200 7025149
HP Pavilion 4455 / D7394A US91168277
Gateway 2000 Vivitron 15 / CPD15F23 8632172
Gateway 2000 X0 -000 0000000
Xxxxxxxxx G810 QV01445756
14
HP Deskjet 895CSE / C6410B SG91Q1V05G
XXX XXXX X.X 00000000
Xxxxxxxxx Xxxxx XX 0000/000 XX0000XX0XX
Dell Monitor M780 0000XX00XX
Xxxxxxx 0000 Xxxxxxx Xxxx / XX0000-00 MH54H4017645
Toshiba Satelite 2530CDS / PAS253U 49629218A
Infocus / LP435Z 3EW91400111
Infocus Lite Pro 580 2AB0601787
KDS Flat Screen Monitor KLT1513A 1540SBB36004376
KDS Flat Screen Monitor KLT1711A 1763BBB34006041
KDS Flat Screen Monitor KLT1711A 1763BBB34006142
KDS Rad 5 Flat Screen 5003944900267
KDS Rad 5 Flat Screen 5003944900174
Dell Dimension CPU 4400 8S4WG11
Dell Dimension CPU 4400 5S4WG11
Nicon Collpix 5000 000-00000-0000
I-Book 700 Mhz Small Screen N/A
NOC EQUIPMENT
Dell Power Vault 130T Robotic DLT UXCXM
Xxxxxxx Xxxxxxxx XXX0 Xxxx Xxxxx / XXX00000X XX00XXX
Dell Power Edge 6350 6J8I0
Raid Web 500 Gigs External Raid No Serial#
Dell Power Edge 6350 Dual Xeon 550mhz 6J8EZ
Dell Power Edge 6350 4Xeon 550mhz 6L80I
Artecon 200 Gig External Raid 24514570296
Artecon 200 Gig External Raid 24514570320
Artecon 200 Gig External Raid 24514570326
Artecon 200 Gig External Raid 24515330067
ATL Power Store L200 DLT Auto Loader No Serial#
TeleNet Server Pentium Pro 200 TSS97060017
Dell Power Edge 2400 Dual Pentium3 550mhz 4JEDB
TeleNet Server Pentium2 333mhz TSS98040035
TeleNet Server Pentium2 300mhz TSS98040027
TeleNet Server Pentium2 266mhz TSS98050001
TeleNet Server Pentium2 266mhz TSS98030058
TeleNet Server Pentium2 400mhz TSS98030057
TeleNet Server Dual Xxxxxxx0 000xxx TSS98070082
TeleNet Server Pentium2 300mhz TSS98030005
3Com SuperStack2 Switch 7WKR101215
Gateway 2000 Pentium Pro 200mhz 7248477
Belkin OmniView No Serial#
0Xxx XxxxxXxxxx0 Xxxxxx XXXX000000
ADC Kentrox Data-Smart T3/E3 IDSU DDM1UZPBRA
Cisco 7200 72602314
Cisco 7200 72602346
00
Xxxxxxxxxx XX Xxxx Xxx 000-0000 72BV200F84F
Cisco Catalyst 1900 00902B49C540
Cisco 3524 Catalyst 000196348D00
Sun Ultra 5 FW01950150
Dell Pentium Dimension XPS Pro 200mhz 92CW1
Dell Pentium Dimension XPS P266 FN77S
Cisco 3620 Frame Relay 362088634
96 Port Patch Panel No Serial#
Centercom 3024tr (Hub) PT3F7080E
Centercom 3024tr (Hub) F03N611BD
Prime 133mhz No Serial#
Generic Pentium Pro 200mhz H1VHGD
Quantex Pentium 120mhz 5001410090
Quantex Pentium 120mhz 5001417346
Digital Link DL3100 Digital Service Multiplexer 3096030917
Digital Link T1 DSU/CSU
Gateway 2000 PentiumII 266mhz 7252411
Power Mac 7100/80 FC5080UR44H
Gateway Pentium 100mhz 5232643
ACI Pentium III 450mhz 97001420
Belkin OmniView 6 Port No Serial#
Gateway Pentium Pro 200mhz 4224929
Gateway Pentium 120mhz 6425691
Unisys Pentium Pro 180mhz 4907791
ACI Pentium 100mhz No Serial#
Belkin OmniView 6 Port No Serial#
3Com SuperStack2 Switch 7YDB025314
0Xxx XxxxxXxxxx0 Xxxxxx 0XXX000000
Mag Innovision MI58HA022364
Belkin OmniView 0 Xxxx Xx Xxxxxx#
Xxx Xxxxxxxxxx XX00XX000000
ACI P.C 97001422
Belkin Omniview Pro 8 Port No Serial#
Dell M780 Monitor 5322DA0727
Telnet Server TSS98030051
Dell Poweredge 4300 01V8E
Dell Dimension XPS D266 No Serial#
Dell VC5 Monitor 15001106
Sun Netra Ultra Xxxxx Xxxxx 000X0000
Sun Ultra Enterprise 450 024H2F8C
Mag Innovision / MagDX1795 018C1358
Telenet Server TSS98040034
Telenet Server TSS98070014
XXX Xxxx Xxxxx Xxxxxxxx 0000
Sun 012H26ED
CT US82321776
Gateway 2000 G6200 6986892
Gateway 2000 G6200 7248475
ACI PC 97200548
Gateway 2000 G6200 MI58HA022363
16
Belkin Omni View 6Port No Serial#
3Com SuperStack2 Switch 7A8F000301
0Xxx XxxxxXxxxx0 Xxxxxx 0XXX000000
Power PC FC6012TV3FV
Telenet Server TSS98030059
Telenet Server TSS98030060
Telenet Server TSS98070013
Gateway 2000 Vivitron / CPD-GF200 7050359
Belkin Omniview 6 Port No Serial#
Sun Ultra 1 Creator 607F04E1
Sun Ultra 1 Creator 651F0EEE
Sun Enterprise 220R 012H3098
Sparc Station 10 251F5398
Power PC XB5310L03FT
Arena II Disk Array 10180
3Com Baseline Switch 0200/7A8F004256
Monarch MCS Server w/ AMD Athlon 15370
Dell PowerEdge 4600 3VK4M11
APC Smartcell XR EP9707162693
APC Smartcell XR EP9707162695
RR Hard Drive Case
RR Hard Drive Case
Automated tape Backup
PHONE SYSTEM
Samsung DCS 50si Package w/ 6 Loop
Misc. 1 for CID, 8 Station inter (6X16) system)
SVMi-4 4 Port Voicemail Card
2 - single line ports
1 - 28 button Display Speaker Phones Falcon 28D
10 - 18 Button Display Speaker Phones Falcon 18D
UPS / BACK-UP POWER
Honda Generator (3KW)
Honda Generator (3KW)
17
EXHIBIT A
---------
Permitted Liens
---------------
None.
18