Exhibit 2.2
THE STATE OF TEXAS ss.
ss. ASSET PURCHASE AGREEMENT
COUNTY OF PECOS ss.
This Asset Purchase Agreement is made and entered into this the __3l__
day of May 2002, by and between PARTNERS ALLIANCE GROUP, INC., a Texas
corporation (hereinafter referred to as "Buyer"), XXXXXXX X. XXXXXX OF XXXXXX
DATA CONSULTANTS, INC., a Texas corporation (hereinafter referred to as
"Seller'"), and is as follows:
WITNESSETH:
WHEREAS, Seller is the owner and holder of certain personal property,
equipment and assets operated under the name of Xxxxxx Data Consultants, Inc.
(the "Business'); and
NOW, THEREFORE, FOR AND IN Consideration of the terms and provisions
hereof, Seller and Buyer do hereby and herein covenant and agree as follows:
I.
PURCHASE AND SALE OF ASSETS
On the terms and subject to the conditions herein set forth, on the
Closing Date (hereinafter defined), Seller shall, and does hereby agree to,
convoy, transfer, sell and deliver unto Buyer, for the consideration hereinafter
provided for, only those assets owned, held or claimed by Seller described or
referenced in Exhibit "A" (the. Purchased Assets List) attached hereto.
II.
PURCHASE PRICE
The purchase price for the Purchased Assets shall be the sum of TWO
HUNDRED AND FIFTY THOUSAND AND NO/100 DOLLARS. ($250,000.00), which shall be
payable by Buyer to Seller at time of closing.
As additional consideration, Buyer will grant Seller continued use of and
access to Buyer's latest Internet services. Buyer shall provide Seller with
Broadband wireless, DSL or other Broadband service that is available to the
geographic location of the Seller's location.
III.
LEASE OF ASSETS
1. Personal Prone Lease. Buyer and Seller agree that there will not be a
personal property lease.
2. Real Property Lease. Buyer and Xxxxxxx agree that there will not be a
real property lease. IV.
IV.
PERSONAL PROPERTY LEASE TERMS
Buyer and Seller agree that there will not be a personal property lease.
V.
ADJUSTMENTS AT CLOSING
In addition, Buyer and Seller shall make the following adjustment at
Closing:
1. All personal property taxes owed for the year 2002 on the Subject
Assets shall be prorated between Seller and Buyer, as of the Closing
Date. Seller has paid, prior to Closing, those taxes due for the
year 2002, and the prorated amounts shall be credited to Buyer at
Closing. Buyer shall assume this obligation to pay personal property
taxes on the Subject Assets for the tax year 2003 and all subsequent
years.
2. At Closing, Seller shall credit Buyer the amount of all monthly
dial-up Internet access payments received by Seller prior to the
Closing Date for services to be rendered after the Closing Date,
which credit xxxx have the effect of lowering the cash payable to
Seller at Closing.
3. At Closing, Seller shall credit Buyer the amount of all monthly
service charges or the prorated monthly amount for network services
(SWB Access Advantage, Internet and Frame Relay. Big Bend Telephone
POTS lines). If all payments are current at the day of closing, then
no payments will be made to the buyer. If payments are over paid to
the service providers, then the Buyer will reimburse the Seller the
prorated amount.
VI.
TIME OF CLOSING
1. The Closing Date pursuant to the terms hereof shall be on or before the
31st day of May, 2002, at 9:00 a.m., but effective as of the close of business
the day of May, 2002 (the "Closing Data"). The Closing shall he held at Pecos
County State Bank 000 X. Xxxx, Xxxx Xxxxxxxx, Xxxxx (the "Closing"), unless
another time and place are mutually agreed upon by the parties hereto.
2. At the Closing, Seller and Buyer shall execute and deliver all
documents and payments necessary or desirable to convey to Buyer all right,
title or interest in the Purchased Assets, in form suitable to both Buyer and
Seller and Buyer's and Seller's counsel including:
a. Seller shall deliver to Buyer any and all Certificates of Title
necessary for the transfer of title; if any, of the Subject Assets;
b. Seller shall provide a UCC search of the records of the Secretary of
State of Texas reflecting no liens on the Subject Assets;
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c. Seller shall deliver to Buyer a Xxxx of Sale in form and substance
suitable to convey the Purchased Assets; and
d. Seller shall prepare, and Buyer and Seller shall execute an Assignment
and Assumption of the Circuit and Service Contracts delineated in Exhibit
"B".
VII.
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby warrants and represents to Buyer that, as of the date hereof
through the Closing Date, Seller is or shall be:
1. The sole owner of the Subject Assets referenced and described in
Exhibit "A" and attached hereto with full right, power and authority to sell,
lease or dispose of same, and that the Subject Assets shall be conveyed or
leased to Buyer free and clear of any debt, lien or other encumbrance
whatsoever.
2. To the extent relating to or affecting the Subject Assets being
conveyed or leased hereby, Seller will operate (up to the Closing Date) the
Business in the usual and ordinary manner and has not:
a. Borrowed or agreed to borrow any funds or incurred, or become subject
to, any obligation or liability (absolute or contingent) covering the
Subject Assets conveyed hereby;
b. Except in the ordinary course of business and consistent with the past
practice of Seller, sold, transferred or otherwise disposed of, or agreed
to sell, transfer or otherwise dispose of, any of the Subject Assets, or
canceled or otherwise terminated, or agreed to cancel or otherwise
terminate, any debts or claims owed to Seller in connection with the
Subject Assets;
c. Entered or agreed to enter into any agreement or arrangement granting
any preferential rights to purchase any of the Subject Assets (including
management and control thereof), or requiring the consent of any party to
the transfer and assignment of the Subject Assets (including management
and control thereof);
d. Suffered any damages, destruction or losses or waived any rights of
value which, in the aggregate, are material considering the Business;
e. Other than in the ordinary course of business, made or permitted any
amendment or termination of any contract, agreement or license to which it
is a party or by which it or any of the Subject Assets are subject;
f. To the best of Seller's knowledge, incurred or become subject to any
claim or liability for damages or alleged damages for actual or alleged
negligence or other tort or breach of contract which is not fully covered
by insurance underwritten by responsible insurers; and
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g. Entered into, agreed to enter into, or consummated any other
transaction other than in the ordinary course of business.
3. Seller will maintain in a good and workmanlike manner all of the
Subject Assets and will continue to operate and manage said property in a
reasonable and prudent manner.
4. Seller will keep all of the, Subject Assets in its recent condition and
state of repair, reasonable wear excepted, and after the date of this Agreement,
Seller will not enter into any lease, service, maintenance, or management
agreement with respect to all or any portion of the Subject Assets without the
written consent of the Buyer.
5. Seller (a) owes no obligations and has contracted no liabilities
affecting the Business, (b) is not in breach or default of any agreement (i)
affecting the Business or to which any of the Subject Assets are subject, or
(ii) which might affect the consummation of the purchase and sale described in
this Agreement, which' have not been: made known to Buyer in writing.
6. Seller is not conveying the Business or Purchased Assets in
contemplation or anticipation of filing bankruptcy.
7. To the best of Sellers knowledge, except as disclosed in writing to
Buyer, (a) Seller has not incurred, and neither it nor any of the Subject Assets
are subject to, any liabilities or obligations (accrued, absolute, contingent or
otherwise), other than unsecured trade accounts payable arising in the ordinary
course of business, since May 1, 2002; and (b) there are no facts in existence
on the date hereof and known to Seller that might reasonably serve as the basis
for any material liabilities or obligations of Seller not disclosed in writing
to Buyer.
8. To the best of Seller's knowledge, (a) all federal, state, county,
local and other taxes, including, without limitation, income taxes, corporate
franchise taxes, and sales and ad valorem taxes, due and payable by Seller on or
before the Closing Date have been paid, and Seller has filed all tax returns and
reports required to be filed by it with all such taxing authorities; (b) the
liabilities for federal, state, county, local and other taxes reflected in the
balance sheet represent reasonable and adequate provision for the payment of all
accrued and unpaid federal, state, county, local and other taxes of Seller for
all periods ending on or prior to April 30, 2002, whether or not disputed; and
(c) no assessments of deficiencies have been made against Seller and no
extensions of time are in effect for the assessment of such deficiencies.
9. To the best of Seller's knowledge, (a) there are no claims, actions,
suits, proceedings or investigations pending or threatened against or affecting
Seller or any of the Subject Assets, at law or in equity, or before or by any
court or federal, state, municipal or other governmental department, commission,
board, agency, or instrumentality; and (b) Seller is not subject to any
continuing court or administrative order, writ injunction, or decree applicable
to it or to its business, property, or employees, and Seller is not in default
with respect to any order, writ, injunction or decree of any court or federal,
state, municipal or other governmental department, commission, board, agency or
instrumentality.
10. Seller shall execute and deliver, at Closing, such Bills of Sale,
leases, assignments and other instruments deemed necessary or proper to transfer
to Buyer all of the Subject Assets
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being sold or leased pursuant to this Agreement, as is delineated in Section VI
of this Agreement. All such documents shall be in form and substance
satisfactory to Seller and Buyer.
11. Seller shall prepare appropriate closing instructions directing
payment, from the Purchase Price due Seller, of all such matters that need to be
considered, such as applicable prorations, if any, which would pertain to the
Subject Assets covered hereunder, and any just claims against Seller received
prior to the time set for consummation of the purchase and sale described in
this Agreement, which should have the effect of reducing the Purchase Price.
VIII.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby warrants and represents to Seller that:
1. Buyer has had access to Seller's books and records and an opportunity
to ask questions concerning the books, records, and Subject Assets, and Buyer
has satisfied itself that the Business is consistent with its needs and
expectations.
2. Buyer has inspected the Subject Assets or has determined such
inspection is not required, and agrees to accept the Subject Assets in their "AS
IS" and "WHERE IS" condition.
3. Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Texas, and has full corporate power and
authority to conduct its business as it is now being conducted and to enter into
and carry out the provisions of this Agreement.
4. Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will violate any provision
of the Articles of Incorporation or By-Laws of Buyer, violate any provision of
any agreement or other obligation to which Buyer is a party or by which Buyer is
bound or to which its assets are subject, or violate or result in a breach of,
or constitute a default under, any judgment, order, decree, rule or regulation
of any court or governmental agency to which Buyer is subject.
5. The execution, delivery and performance of this Agreement has been
authorized by the Board of Directors of Buyer, and this Agreement constitutes
the valid and legally binding obligation of Buyer, enforceable in accordance
with its terms.
IX.
RISK OF LOSS
The Purchased Assets have been inspected by Buyer and will be accepted by
Buyer as of the closing Date in their "AS IS" and "WHERE IS" condition. The
Purchased Assets will be delivered to Buyer on the Closing Date in their present
condition, normal wear and tear accepted. Seller makes no representations or
warranties as to the condition of any of the Purchased Assets. All risks of
ownership and loss as to the Purchased Assets, whether by fire, vandalism,
theft, casualty, or otherwise shall remain with Seller until Closing, as well as
all rights under Seller's casualty and property insurance. If any such
destruction, loss or damages amounts to more than TWENTY-FIVE THOUSAND DOLLARS
($25,000.00), Buyer may, at its option, terminate this
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Agreement. All risk of ownership and loss to the Purchased Assets, whether by
fire, vandalism, theft, casualty, or otherwise will belong to Buyer after the
Closing
X.
ASSUMPTION OF LIABILITIES
Other than as specifically set forth in this Agreement, Buyer shall not
and does not assume any of Seller's liabilities, including, but not limited to,
any liabilities to any employees of Seller, all taxes of any kind (including,
without limitation, all income, franchise, excise and employment taxes,
including any interest and penalties thereon), and liabilities arising under any
suits, actions or proceedings against Seller or the Subject Assets (pertaining
to periods prior to the Closing Date), and any other debts or contingencies or
any other liabilities of Seller, whether fixed or contingent, and all such
liabilities shall remain the sole obligations of Seller. From and after the
Closing Date, Buyer shall and does assume any liability under any contracts for
products and services currently in effect and outlined in Exhibit "B", such as
telecommunication circuits and Cisco hardware, which contracts will be assigned
to and assumed by Buyer at Closing. Buyer agrees to and shall indemnify Seller
against any default or penalty under these assumed contracts.
XI.
TRANSITION PERIOD
1. For a period of five (5) business days after Closing, Seller will
devote the same time and attention as prior to the sale of the Business to the
conduct of the Business, without salary. The purpose of such period is to
familiarize the Buyer with the customers and operation of the equipment of the
Business, and any other such: reasonable requests as Buyer may have, from 9 a.m.
until 5 p.m., Monday though Friday, excluding public holidays
2. The thirty (30) day period after Closing shall be utilized by both
parties as a transition period (the "Transition Period"). During the Transition
Period, both parties shall have access to the premises, equipment, employee
services and other aspects of the Business as necessary and on an ongoing basis
in order to facilitate. transition of data, products, services, records, and to
accomplish any other tasks as might be necessary to effect the transfer of the
Business to Buyer and the removal of Seller's personal files and property from
the promises and. equipment.
XII.
COVENANT NOT TO COMPETE
Buyer and Seller agree that for a period of five (5) years from and after
the Closing Date hereof (the "Restriction Period") at $1,000 per year
consideration (funds allocated from the purchase price), Seller and any
stockholders or interest holders of same (which shall be collectively referred
to as "Seller" for purposes of this section) shall not engage in the business of
provisioning internet services within a fifty (50) mile radius of any current
location of the Business as of the Closing Date; said locations being Fort
Stockton, Alpine, Marathon, Terlingua, Presidio, Sanders, Sheffield, Xxxxxxxx,
Big Bend National Park, Heath Canyon, Texas (the "Restricted Area"). The term
"Internet Services," as used herein, is defined as dial up
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internet access, web hosting, broadband wireless internet access, ISDN, DSL,
Cable, and Satellite access, but not including services or access for Seller's
personal or family use (including web hosting), and internet-related consulting
or network consulting services, or systems administration. Further, during the
Restriction Period, Seller shall not, directly or indirectly, whether
individually or as an employee, contractor, agent, officer, director, or owner
(directly or indirectly) of an ownership interest of any entity, engage,
participate, or assist in, a business providing Internet Services in or to the
Restricted Area. During the Restriction Period and within the Restricted Area,
Seller further agrees that he shall not, either directly or indirectly, through
any person, firm, association or corporation with which he is now, or may
hereafter become, associated cause, induce or encourage any present or future
employee of Buyer or of any of its affiliates to leave the employ of Buyer or
any such affiliate to accept employment with it, with any such person, firm,
association, or corporation, or with any business that conducts a business in
competition with or similar to that to be conducted by Buyer. The foregoing
agreement not to compete shall not be held invalid or unenforceable because of
the scope of the territory or actions subject thereto or restricted thereby, or
the period of time within which such agreement is operative, but any judgment of
a court of competent jurisdiction may define the maximum territory of action
subject to and restricted by this paragraph and the period of time during which
such covenant is enforceable. Seller consents to the entry against him of
injunctive relief in the event of his breach of this covenant.
XIII.
CONDITIONS AND OBLIGATIONS OF BUYER
The obligations of Buyer under this Agreement shall, at the option of
Buyer, he subject to the following conditions:
1. Buyer shall not have discovered any material error, misstatement, or
omission in the representations or warranties made by Seller throughout the
provisions of this Agreement.
2. Affidavit of Seller. Buyer shall have received an affidavit of Seller
reasonably satisfactory in form: and content to Buyer's' counsel to the effect:
(a) that Xxxxxxx X. Xxxxxx, President of Xxxxxx Data Consultants, Inc. with full
and exclusive right to sell the Subject Assets; (b) that the Agreement is the
binding obligation of Seller; (c) that the Subject Assets being acquired by
Buyer pursuant to this Agreement are (or shall be as of the Closing Date) free
and clear of any liens and encumbrances, and Buyer shall receive good and
indefeasible title from the Seller to the Subject Assets as of the Closing Date;
and (d) such other matters as Buyer may reasonably require.
3. Seller shall have fully complied with the provisions hereof.
XIV.
INDEMNIFICATION
Other than as specifically set forth herein, Buyer agrees only to acquire
the Subject Assets of the Seller described herein and nothing herein shall be
construed as an assumption by the Buyer of any of the Seller's liabilities or
obligations. Seller agrees to indemnify and hold and save Buyer free and
harmless from any and all claims, demands, damages, suits, causes of action,
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lawsuits, liability, costs and expenses (including Buyer's attorney's fees in
defending themselves as necessitated by such action) of any kind or character
incurred in connection with, resulting from or on account of:
1. All debts, accounts payable, obligations or liabilities of the Seller,
in connection with the Business, for all periods prior to the Closing Date only;
2. Any applicable federal, state, county, city, or other taxes of any
nature whatsoever by Seller, incurred, accrued or relating to property owned or
leased for all periods prior to Closing Date, other than those specifically
assumed by Buyer herein; or
3. Any violations, up to the Closing Date, of any federal, state, local or
environmental laws, statutes or regulations applicable to the Business;
provided, however, (a) Seller's indemnity obligation set forth above shall
remain in effect for n period not exceeding one (1) year from the Closing Date,
and (b) the amount of such indemnity obligation hereunder shall be limited to
the cash amount of the Purchase Price.
XV.
EMPLOYEES
Seller shall terminate employment of all employees of the Business
effective as of the Closing Date. Seller will Pay wages through May 31, 2002,
and Buyer shall be responsible thereafter. It is further agreed that all
salaries, wages, vacation pay, sick leave pay, all other compensation of any
form whatsoever will be fully and finally paid to all employees, independent
contractors, agents and servants of the Seller, at Closing, at the sole risk,
cost and expense of the Seller. Seller may, at his sole discretion and by
individual agreement with employees, compensate employees for services rendered
to Seller during the Transition Period.
XVI.
DEFAULT
If either Seller or Buyer defaults in complying with any of the terms
hereof, the non-defaulting party may terminate this Agreement and seek any
relief as may be provided by law.
XVII.
INVALID PROVISIONS
If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under the present or future laws, such provision shall be fully
severable, and the Agreement shall be construed and enforced as if such
provision had never comprised a part of this Agreement, and the remainder of the
Agreement shall not be affected by any such illegal, invalid, or unenforceable
provision or by its severance from this Agreement.
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XVIII.
ARBITRATION CLAUSE
Any controversy or claim arising out of or relating to this Agreement, or
the breach thereof, or any claim or dispute between the parties to this
Agreement, shall be settled by arbitration in accordance with Commercial
Arbitration Rules of the American Arbitration Association, and judgment upon the
award rendered by the: arbitrator(s) may be entered in any Court having
jurisdiction thereof. All arbitration proceedings shall be held in Pecos County,
Texas and all arbitrators shall be appointed by the current presiding judge of
the 83rd Judicial District Court, Pesos County, Texas, or if he fails to make
such appointments within 90 days after a notice demanding arbitration has bean
delivered, the arbitrators shall be appointed by the American Arbitrators
Association under their rules.
XIX.
MISCELLANEOUS PROVISIONS
1. This Agreement is performable in Fort Stockton, Pecos County, Texas in
accordance with the laws of the State of Texas.
2. Each party hereto shall be responsible for its or their own legal
expenses.
3. Buyer acknowledges that this Agreement and its contents are not public
and Buyer agrees to maintain the confidentiality, as best it can, pending
Closing of this Agreement and all its terms, conditions and covenants.
4. This Agreement, along with the Xxxx of Sale shall constitute the entire
agreement between the parties hereto with respect to the subject matter hereof.
This Agreement may not be amended, except by all instrument in writing, signed
by the Buyer and the Seller.
5. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same instrument.
6. The paragraph captions in this Agreement are for the sake of
convenience only and shall not in any way limit or be deemed to construe and
interpret the terms and provisions hereof. All words herein in the neuter gender
shall be deemed to include words in the male or female gender, and vice versa,
whenever the context shall so require. Likewise, all words herein in the
singular shall be deemed to include words in the plural, and vice versa,
whenever the context shall so require.
7. Buyer shall make reasonable efforts to forward mail for Seller to
Seller at the address for notice set forth below.
8. It is acknowledged by Buyer that Seller maintains certain personal
property separate and apart from the Purchased Assets and/or the Leased Assets
purchased or leased under this Agreement at the Business premises. All personal
property remaining at the Business premises MUST be itemized, labeled and set
aside. Seller has the right to remove, sell or dispose of the Seller's Personal
Property at any time, or leave same on the premises for safekeeping.
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9. It is acknowledged by Buyer that it has not purchased Seller's stock of
retail goods and merchandise, and parts or other items not specifically listed
in the Xxxx of Sale (the "Seller's Inventory"). Seller has the right to remove,
sell or otherwise dispose of Seller's Inventory at any time. Buyer agrees to use
all reasonable care to prevent loss, theft or damage of the Seller's inventory,
however, Buyer assumes no liability for Seller's Inventory.
10. Buyer shall effect any changes necessary to migrate merchant account
services to suit Buyer's needs at Buyer's sole expense, if any.
11. It is acknowledged by Seller and Buyer that, as of the Closing Date,
Seller has amounts: outstanding under invoices for retail sales of inventory and
equipment (the "Outstanding Retail Invoices"), which Outstanding Retail invoices
have not yet been collected by Seller. A schedule of the Outstanding Retail
Invoices is: attached hereto as Exhibit "C" and made a part hereof for all
purposes. Buyer agrees that should any amounts be. paid to it on the Outstanding
Retail Invoices, it will pay such amounts to Seller within ten (10) business
days of its receipt of same. In the event it becomes necessary, Buyer further
grants to Seller the right to use the name "Xxxxxx Data" for the limited purpose
of collecting the amounts owed under the Outstanding Retail Invoices.
XX.
NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES
All statements contained herein, in any exhibit hereto, or in any
certificate or other written instrument delivered by or on behalf of Seller or
Buyer pursuant to this Agreement, or in connection with the transactions
contemplated hereby, shall be deemed representations and warranties by Seller or
Buyer, as the case may be. Regardless of any investigation at any time made by
or on behalf of any party hereto, or of any information any party may have in
respect thereof, all covenants, agreements, representations and warranties made
hereunder, or pursuant hereto, or in connection with the transactions
contemplated hereby, shall survive the Closing and shall continue in effect
thereafter for a period of two (2) years following the Closing Date, and five
(5) years with regard to the covenant not to compete (provided in Article XII).
XXI.
NOTICES
Whenever in this Agreement notice is required or permitted to be given by
either party to the other, such notices shall be in writing and sent by
certified or registered mail, return receipt requested, addressed as follows:
If to Buyer, to: 000 X. Xxxxxxxxx XX Xxx 000
Xxxx Xxxxxxxx, Xxxxx 00000
If to Seller, to: XX Xxx 000
Xxxxxx, Xxxxx 00000-0000
Notices shall be deemed delivered when deposited in the United States mail
as above provided. Changes of address by either party must be by notice to the
other in the same manner as above specified.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the ____ day of May, 2001.
Seller:
-------
XXXXXX DATA CONSULTANTS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxx, President
Buyer:
------
PARTNERS ALLIANCE GROUP, INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------------
Xxxx Xxxxxxxx, President
STATE OF TEXAS ss.
COUNTY OF Pecos ss.
This instrument was acknowledged before me on this 31 day of May, 2002, by
Xxxxxxx X. Xxxxxx, President of Xxxxxx Data Consultants, Inc.
/s/ Xxxxx Xxxxxxx
----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
COUNTY OF PECOS ss. [Notary Seal]
This instrument was acknowledged before me on this 31 day of May, 2002, by
XXXX XXXXXXXX, PRESIDENT of PARTNERS ALLIANCE GROUP, INC., a Texas Corporation.
/s/ Xxxxx Xxxxxxx
----------------------------------------
Notary Public, State of Texas
[Notary Seal]
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