ASSET PURCHASE AGREEMENT
Exhibit
10.1
This
Asset Purchase Agreement ("Agreement"), effective as of
March 1, 2009, is by and among:
EMTA Holdings, Inc., a Nevada
corporation ("EMTA"), and its wholly owned subsidiary Lumea, Inc., a Nevada
corporation ("Lumea"),
and
Easy Staffing Services, Inc.,
a Delaware corporation ("Easy"), and its wholly-owned subsidiaries ESSI, Inc., a Delaware
corporation ("ESSI"), and Easy
Staffing Solutions, Inc., an Illinois corporation f/k/a Xxxxxx Placement
Services, Inc. ("Xxxxxx")
(collectively the "Sellers").
RECITALS
EMTA
develops and manufactures innovative products to conserve energy, particularly
for petroleum-based fuels. The company's engine and fuel additives are marketed
under the brands XenTxTM ,
SynergynTM and
CleanBoostTM brands,
and are sold both to commercial and retail customers.
Easy,
ESSI and Xxxxxx are full service employment agencies, offering temporary labor
staffing, direct placement, employee leasing, and payroll services in many
states across the country.
Lumea and
Easy are parties to a Letter of Intent dated October 17, 2008 (the "LOI").
Pursuant to the LOI, Lumea and the Sellers established the material commercial
teens regarding the Sellers' transfer of their outstanding shares of common
stock of Easy to Lumea in exchange for shares of common stock of ETMA (the "Original Transaction"). The
parties have elected to modify the commercial terms of the Original Transaction
so that Lumea will acquire certain assets and assume certain liabilities of each
of the Sellers in exchange for shares of EMTA and a promissory note. This
Agreement will memorialize the definitive agreement among the parties as it
relates to the modified transaction.
NOW,
THEREFORE, in consideration of the premises, and of the representations,
warranties, covenants and agreements set forth herein, the parties agree and
reaffirm as follows:
ARTICLE
I
PURCHASE;
CLOSING
1.1 Letter of
Intent. Upon execution of this Agreement, the LOI will be deemed
terminated and of no further force or effect. To the extent there exists a
conflict of terms or provisions in the LOI and this Agreement, the terms and
provisions of this Agreement will control.
1.2 Purchase and Sale of
Assets. On and subject to the terms and conditions of this
Agreement, Lumea agrees to purchase from the Sellers, and the Sellers agree to
sell, transfer, convey, and deliver to Lumea, all of the Acquired Assets at the
Closing for the consideration specified below in this Section 1, where "Acquired
Assets" means all of the right, title, and interest that the Sellers possess and
have the right to transfer in and to all of their assets, including all of
their:
(i) intellectual
property, goodwill associated therewith, licenses and sublicenses granted and
obtained with respect thereto, and rights thereunder, remedies against
infringements thereof, and rights to protection of interests therein under the
laws of all jurisdictions;
(ii) leases
(including equipment leases), subleases, and rights thereunder, and
improvements, fixtures, and fittings thereon;
(iii) agreements,
contracts, indentures, mortgages, instruments, security interests, guaranties,
other similar arrangements, and rights thereunder;
(iv) accounts,
notes, and other receivables;
(v) tangible
personal property (such as inventory, equipment, supplies, and
furniture);
(vi) claims,
deposits, prepayments, refunds, causes of action, choses in action, rights of
recovery, rights of set off, and rights of recoupment (including any such item
relating to the payment of taxes);
(vii) franchises,
approvals, permits, licenses, orders, registrations, certificates, variances,
and similar rights obtained from governments and governmental agencies to the
extent assignable or transferable;
(viii) books,
records, ledgers, files, documents, correspondence, lists, plats, architectural
plans, drawings, and specifications, creative materials, advertising and
promotional materials, studies, reports, and other printed or written materials;
and
(ix) subject
to part (B) below, cash;
provided, however,
that the Acquired Assets shall not include (A) the corporate charter,
qualifications to conduct business as a foreign corporation, arrangements with
registered agents relating to foreign qualifications, taxpayer and other
identification numbers, seals, minute books, stock transfer books, blank stock
certificates, and other documents relating to the organization, maintenance, and
existence of the Sellers as corporations, (B) cash in an amount equal to the
accrued but unpaid liabilities of the Sellers in excess of the Assumed
Liabilities and the liabilities identified in the Promissory Note, or (C) any of
the rights of the Sellers under this Agreement (or under any side agreement
between the Sellers on the one hand and EMTA or Lumea on the other hand entered
into on or after the date of this Agreement).
1.3 Assumption of
Liabilities. On and subject to the terms and conditions of this
Agreement, at the Closing Lumea agrees to assume and become responsible for all
of the liabilities of the Sellers set forth on Annex A in the
aggregate amount of approximately Two Million Two Hundred Fifty Thousand Dollars
($2,250,000) (the "Assumed
Liabilities"). The parties will perform a post-closing internal audit of
the Assumed Liabilities. Lumea hereby agrees to assume the Assumed Liabilities
up to a gross amount of $2,500,000. No amount in excess of $2,500,000 will be
deemed part of the Assumed Liabilities and the parties will agree to revise
Annex A to
allocate the total amount assumed. If the internal audit amount is $2,000,000 or
less, the difference between $2,000,000 and the actual internal audited amount
will be added to the principal amount of the Promissory Note (defined in Section
1.4(i0 below). Lumea will not assume or have any responsibility, however, with
respect to any other obligation or liability of the Sellers not included within
the definition of Assumed Liabilities.
1.4 Purchase Price.
As consideration for the sale of the Acquired Assets to Lumea, Lumea agrees to
pay to Easy at the Closing
(i) an
aggregate of Fifteen Million Five Hundred Thousand (15,000,000) shares of common
stock of EMTA (the "EMTA
Shares"), and
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(ii) a
promissory note in the aggregate principal amount of Eight Million Seven
Hundred-Fifty Thousand Dollars ($8,750,000), in the form set forth on Annex B (the "Promissory Note"), subject to
adjustment pursuant to Section 1.3 above.
Each of
ESSI and Xxxxxx hereby acknowledge that consideration attributable to the
Acquired Assets of ESS1 and Xxxxxx will be remitted to Easy.
1.5 Closing. The
closing of the transactions contemplated by this Agreement (the "Closing") will take place at
the offices of Easy Staffing Services, Inc. at 10:00 a.m. on the third business
day following the satisfaction or waiver of each of the closing conditions set
forth in Article V (the "Closing Date"), other than
those conditions that can only be satisfied on or as of the Closing Date, which
must be satisfied or waived at or as of the Closing of this
Agreement.
1.6 Allocation. The
Parties agree to allocate the purchase price (and all other capitalizable costs)
among the Acquired Assets for all purposes (including financial accounting and
tax purposes) in accordance with the allocation schedule attached hereto as
Annex
C.
ARTICLE
II
SELLER
REPRESENTATIONS AND WARRANTIES
Each of
the Sellers severally represents and warrants to Lumea that the statements
contained in this Article II are complete and correct as of the date of this
Agreement except as set forth in the disclosure schedule delivered by Sellers to
Lumea with this Agreement (the "Disclosure Schedule") where
the sections below permit a disclosure:
2.1 Organization.
Each Seller is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and authorized
as a foreign corporation to do business in the states where it is doing business
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now conducted in those
jurisdictions, except where failure to be so qualified would not have a material
adverse effect on the business, assets or financial condition of the relevant
Seller taken as a whole ("Material Adverse
Effect").
2.2 Authority. Each
Seller has all the requisite power, authority and legal capacity to execute and
deliver this Agreement, and each other agreement, document, or instrument or
certificate contemplated by the Agreement or to be executed by the relevant
Seller in connection with the consummation of the transactions contemplated by
this Agreement (together with this Agreement, the "Seller Documents"), and to
consummate the transactions contemplated hereby and thereby. This Agreement has
been, and each of the Seller Documents will be at or prior to the Closing, duly
and validly executed and delivered by the Sellers and (assuming the due
authorization, execution and delivery by the other parties hereto and thereto)
this Agreement constitutes, and each of the Seller Documents when so executed
and delivered will constitute, legal, valid and binding obligations of the
Sellers, enforceable against each in accordance with their respective
obligations and terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting creditors' rights and
remedies generally, and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity).
2.3 Ownership of
Subsidiaries. Easy owns all of the shares of ESSI and Xxxxxx free
and clear of any and all liens, charges or encumbrances. Listed on Schedule 2.3 is the
list of all aliases, doing business as (dba's), trademarks, and servicemark
names Sellers own.
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2.4 No Conflicts or
Consents. Except as set forth on Schedule 2.4,
execution and delivery by the Sellers of this Agreement and the Seller
Documents, the consummation of the transactions contemplated hereby or thereby,
or compliance by the Sellers with any of the provisions hereof or thereof will
not (i) conflict with, violate, result in the breach or termination of, or
constitute a default under any note, bond, mortgage, indenture, insurance
policy, license, agreement or other instrument or obligation to which any Seller
is a party or by which Sellers or any of the Acquired Assets are bound; (ii)
violate any statute, rule, regulation, order or decree of any governmental body
or authority by which the Sellers are bound; or (iii) result in the creation of
any lien upon the Acquired Assets except, in case of clauses (ii) and (iii) for
such violations, breaches or defaults as would not, individually or in the
aggregate, have a Material Adverse Effect. Except as set forth on Schedule 2.4, no
consent, waiver, approval, order, permit or authorization of, or declaration or
filing with, or notification to, any person or governmental body is required on
the part of the Sellers in connection with the execution and delivery of this
Agreement or the Seller Documents, or the compliance by the Sellers as the case
may be, with any of the provisions hereof or thereof.
2.5 Title to
Assets. Except as set forth on Schedule 2.5, except
as would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, the Sellers have (or will have, at Closing) good and
marketable title to the Acquired Assets, free and clear of all liens of any
nature whatsoever, except (i) statutory liens securing payments not yet due (or
being conducted in good faith and for which adequate reserves have been
established), (ii) liens for personal property taxes not yet due and payable,
(iii) such imperfections or irregularities of title or liens as do not
materially affect the use of the properties or assets subject thereto or
affected thereby or otherwise materially impair business operations. The Sellers
do not own any real property. The Acquired Assets include all of the assets and
properties held for use by the Sellers necessary to conduct their business as
presently conducted. All of Sellers' tangible assets are in good repair, have
been well maintained and are in good operating condition, do not require any
material modifications or repairs, and comply in all material respects with
applicable laws, ordinances and regulations, ordinary wear and tear
excepted.
2.6 Financial
Statements. An unaudited and consolidated income statement of
Sellers for the year ended December 31, 2008, and an unaudited and consolidated
balance sheet of Sellers as of December 31, 2008, are attached hereto on Annex D,
(collectively, the "Seller Financial Statements").
The Seller Financial Statements were not prepared in accordance with
GAAP, but fairly present the financial condition and results of operations of
the Sellers as of the respective dates thereof and for the periods covered
thereby. The balance sheet contained in the Seller Financial Statements fairly
reflects all liabilities of the Sellers of the types normally reflected in a
balance sheet as of the date thereon. The Sellers have elected to eliminate the
footnotes that would normally accompany a full set of financial
statements.
2.7 Tax
Matters.
(i) Except
for tax returns for the fiscal year ended December 31, 2008 (which returns are
not yet due), and except as set forth on Schedule 2.7 of the
Disclosure Schedules: (A) all tax returns required to be filed by or on behalf
of the Sellers have been properly prepared and duly and timely filed with the
appropriate taxing authorities in all jurisdictions in which such tax returns
are required to be filed (after giving effect to any valid extensions of time in
which to make such filings), and all such tax returns were true, complete and
correct in all material respects; (B) all taxes payable by or on behalf of the
Sellers or in respect of their income, assets or operations have been fully and
timely paid, and adequate reserves or accruals for taxes have been provided with
respect to any period for which tax returns have not yet been filed or for which
taxes are not yet due and owing; and (C) the Sellers have not executed or filed
with the Internal Revenue Service (the "IRS") or any other taxing authority any
agreement, waiver or other document or arrangement extending or having the
effect of extending the period for assessment or collection of taxes (including,
but not limited to, any applicable statute of limitation),
and no power of attorney with respect to any tax matter is currently in force
except for the Sellers' tax counsel. "Tax or taxes" means all federal, state,
local, income taxes or similar governmental charges, fees, levies or
assessments.
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(ii) Except
as set forth on Schedule 2.7, each of
the Sellers has withheld and paid all taxes required to have been withheld and
paid in connection with amounts paid or owing to any employee, independent
contractor, creditor, stockholder, or other third party.
2.8 Litigation.
Except as set forth on Schedule 2.8, there
is no suit, action, proceeding, investigation, claim or order pending or, to the
knowledge of the Sellers, overtly threatened against the Sellers (or to the
knowledge of the Sellers) pending or threatened, against any of the officers,
directors or key employees of the Sellers with respect to their business
activities on behalf of the Sellers, or to which the Sellers are otherwise a
party, which, if adversely determined, would have a Material Adverse Effect,
before any court, or before any governmental department, commission, board,
agency, or instrumentality; nor to the knowledge of the Sellers is there any
reasonable basis for any such action, proceeding, or investigation except as
identified and detailed in a schedule provided by the Sellers.
2.9 Compliance with Laws.
Except as set forth on Schedule 2.9, the
Sellers are in compliance with all federal, state and local statutes, laws,
rules, regulations, orders and ordinances applicable to them or to the conduct
of their business or operations or the use of their properties (including any
leased properties) and assets, except for such non-compliances as would not,
individually or in the aggregate, have a Material Adverse Effect.
2.10 Accuracy of
Statements. No representation or warranty of the Sellers contained
in this Agreement or in any Annex or schedule hereto or in any certificate or
other instrument furnished by the Sellers pursuant to the terms hereof, taken as
a whole, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein or therein not
misleading.
2.11 Trademarks; Software;
Patents; Copyrights; and Know-How. To the best of Sellers'
knowledge, the Sellers possess, license or otherwise have the right to use all
trademarks, software, patents, copyrights, trade secrets and proprietary
know-how ("Intangible Assets")
necessary for the conduct of their operations as conducted on the date
hereof. To the best knowledge of Sellers, none of the Intangible Assets is
currently being challenged, is involved in any pending or threatened
administrative or judicial proceeding, or conflicts in any respect material to
Sellers with any rights of any other person. To the knowledge of Sellers, none
of the Sellers' operations involves any infringement of any proprietary right of
any person.
2.12 Contracts. True
and complete copies of all written contracts and other written agreements to
which any of the Sellers is a party have been made available for review, or will
be made available for review upon Lumea's request prior to Closing.
2.13 Employee Plans.
Sellers have "employee benefit plans" as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") and other benefit
arrangement provided by Sellers with respect to employees, ("Employee Benefit Plans").
The Sellers are in material compliance with such laws as govern ERISA and
other benefit plans and have filed all applicable filings or caused such filings
to be made on behalf of the Sellers. The Sellers are not aware of any notices,
orders, or other limitations from any regulatory body in conjunction with these
plans.
2.14 Property and Casualty
Insurance. Each Seller has property and casualty liability coverage
on all assets of the relevant Seller. There are no pending claims thereunder of
more than $5,000 of all insurance policies or fidelity bonds in force on the
date hereof with respect to and insuring the directors, officers, employees,
assets, properties or operations of the Sellers. All such policies and fidelity
bonds are
in full force and effect. True and complete copies of all such insurance
policies and fidelity bonds have been made available to Lumea for review, or
will be made available for review upon Lumea's request prior to Closing,
together with a summary description including the premiums currently paid
thereon, type of policy, name of insured, the insurer, expiration date, the
hazards insured against and the dollar amount of coverage per occurrence and in
the aggregate and deductibles. Except for claims set forth in Schedule 2.14 there
are no outstanding unpaid claims under any of such policies or bonds, and the
Sellers have received no notice of cancellation or non-renewal
thereof.
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ARTICLE
III
PURCHASER
REPRESENTATIONS AND WARRANTIES
3.1 Organization.
EMTA and Lumea are corporations duly organized, validly existing and in
good standing under the laws of the jurisdiction of their incorporations and
authorized as foreign corporations to do business in the states where they are
doing business and have all requisite corporate power and authority to own,
lease and operate its properties and to carry on its business as now conducted
in those jurisdictions, except where failure to be so qualified would not have a
Material Adverse Effect.
3.2 EMTA Capital
Stock. The authorized capital stock of EMTA consists exclusively of
250,000,000 shares of common stock, par value $0.001, and 1,000,000 shares of
undesignated preferred stock, and as of February 14, 2009, there were 73,816,103
shares of common stock outstanding. No shares of any class are held in treasury.
All of the issued and outstanding shares of EMTA have been validly issued, are
fully paid and nonassessable and are free of preemptive rights. As of the date
of this Agreement, 15,293,354 shares of the common stock of EMTA are reserved
for issuance pursuant to the exercise of stock options granted and outstanding
under the stock option plan designated the 2007 Stock Option Plan.
3.3 Authority. Each
of EMTA and Lumea has all the requisite power, authority and legal capacity to
execute and deliver this Agreement, and each other agreement, document, or
instrument or certificate contemplated by the Agreement or to be executed by
EMTA and Lumea in connection with the consummation of the transactions
contemplated by this Agreement (together with this Agreement, the "Purchaser Documents"), and to
consummate the transactions contemplated hereby and thereby. This Agreement has
been, and each of the Purchaser Documents will be at or prior to the Closing,
duly and validly executed and delivered by EMTA and Lumea, as applicable, and
(assuming the due authorization, execution and delivery by the other parties
hereto and thereto) this Agreement constitutes, and each of the Purchaser
Documents when so executed and delivered will constitute, legal, valid and
binding obligations of EMTA and Lumea, as applicable, enforceable against each
in accordance with their respective obligations and terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability, to
general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity).
3.4 No Conflicts or
Consents. Execution and delivery by EMTA and Lumea of this
Agreement and the Purchaser Documents, the consummation of the transactions
contemplated hereby or thereby, or compliance by EMTA and Lumea with any of the
provisions hereof or thereof will not (i) conflict with, violate, result in the
breach or termination of, or constitute a default under any note, bond,
mortgage, indenture, insurance policy, license, agreement or other instrument or
obligation to which EMTA or Lumea is a party or by which EMTA or Lumea is bound;
(ii) violate any statute, rule, regulation, order or decree of any governmental
body or authority by which EMTA or Lumea is bound; or (iii) result in the
creation of any lien upon the assets of EMTA or Lumea except, in case of clauses
(ii) and (iii) for such violations, breaches or defaults as would not,
individually or in the aggregate, have a Material Adverse Effect. No consent,
waiver, approval, order, permit or authorization of, or declaration or filing
with, or notification to, any person or governmental body is required on the
part of EMTA or Lumea in
connection with the execution and delivery of this Agreement or the Purchaser
Documents, or the compliance by EMTA or Lumea as the case may be, with any of
the provisions hereof or thereof.
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3.5 SEC Documents; Financial
Statements; Liabilities.
(i) EMTA has
timely filed all required reports, schedules, forms, statements and other
documents with the SEC since February 9, 2007 (the "SEC Documents"). The SEC
Documents, and any such reports, forms and documents filed by EMTA with the SEC
after the date of this Agreement, complied, or will comply, at the time of
filing as to faun in all material respects with the requirements of the
Securities Act of 1933 (the "Securities Act") or the
Securities and Exchange Act of 1934 (the "Exchange Act"), as the case
may be, and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and except to the extent that information
contained in any SEC Document has been superseded by a later filed SEC Document,
none of the SEC Documents at the time of filing contained any untrue statement
of a material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(ii) EMTA's
financial statements included in the SEC Documents complied at the time of
filing with the SEC as to form in all material respects with the applicable
accounting requirements and published rules and regulations of the SEC with
respect thereto, were prepared in accordance with GAAP applied on a basis
consistent with prior periods, and fairly present the financial position of EMTA
at such dates and the results of operations and cash flow for the respective
periods then ended. EMTA does not have, nor are any of its assets subject to,
any liability, commitment, debt or obligation (of any kind whatsoever whether
absolute or contingent, accrued, fixed, known, unknown, matured or unmatured) of
a type required by GAAP to be reflected in EMTA's financial statements, except
(i) as and to the extent reflected on EMTA balance sheet dated as of December
31, 2008 or the footnotes that are a part of its financial statements, or (ii)
as may have been incurred or may have arisen since December 31, 2008 in the
ordinary course of business and that are not material individually or in the
aggregate. Except as set forth in the SEC Documents, since February 1997, EMTA
has not made any change in the accounting policies or practices applied in the
preparation of its financial statements. EMTA's independent auditors have not
issued any audit reports or other reports on internal controls which indicate
that the internal controls associated with or otherwise covering EMTA have had
any material weaknesses or that the accounting records associated with or
otherwise covering EMTA contained or could contain any material
errors.
(iii) EMTA's
balance sheet dated December 31, 2008 includes appropriate reserves for all
taxes and other known liabilities incurred as of such date but not yet
payable.
3.6 No Finder's
Fee. Neither EMTA nor Lumea has incurred or become liable for any
broker's commission or finder's fee related to the transactions contemplated by
this Agreement.
ARTICLE
IV
COVENENATS
4.1 Conduct of
Business. From the date of this Agreement through the Closing Date,
Sellers shall conduct their business only in the ordinary course of business
consistent with past practice.
4.2 Negative
Covenants. During the period commencing on the date of this
Agreement and ending on the Closing Date, Sellers shall not, without the prior
written consent of Lumea, cause, permit or take any action to:
(i) acquire
any assets or properties, other than in the ordinary course of business and
consistent with past practice;
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(ii) sell,
lease, transfer, dispose of, any assets or properties, other than for fair
consideration in the ordinary course of business and consistent with past
practice;
(iii) enter
into or effect any merger, consolidation, reclassification, recapitalization or
other business combination or reorganization;
(iv) assume,
guarantee, endorse or otherwise become liable or responsible (whether direct,
contingent or otherwise) for the obligations of any other person, except
endorsements in the ordinary course of business and consistent with past
practice in connection with the deposit of items for collection;
(v) make any
loans, advances or capital contributions to or investments in any
person;
(vi) sell,
transfer, license or otherwise dispose of or encumber any item of Intangible
Assets other than the renewal or lapse of software licenses not material to
Seller's business operations;
(vii) cancel or
compromise any debt or claim or waive, release, grant or transfer any rights of
value or modify or change in any material respect any existing license, lease,
contract or other document, other than in the ordinary course of business and
consistent with past practice;
(viii) hire any
additional employees or implement any new Employee Benefit Plans or Employee
Policies and Procedures;
(ix) enter
into any contract, lease, commitment or other agreement of any type whatsoever,
unless terminable without liability to Seller on notice of thirty (30) days or
less;
(x) create,
incur or assume any indebtedness except for normal trade payables incurred in
the ordinary course of business;
(xi) cause or
permit its assets and properties to not be maintained in their current
condition, ordinary wear and tear excepted;
(xii) not
maintain its books, accounts and records in the ordinary course of business
consistent with past practices, not continue to collect accounts receivable and
pay accounts payable utilizing normal procedures and not comply in all material
respects with all contractual and other obligations applicable to its
operations;
(xiii) enter
into any commitment for capital expenditures of the Seller in excess of $1,000
for any individual commitment and $5,000 for all commitments in the
aggregate;
(xiv) enter
into any transaction or make or enter into any contract, agreement or instrument
which by reason of its size or otherwise is not in the ordinary course of
business consistent with past practice;
(xv) write any
insurance policy or enter into any reinsurance agreement, except in the ordinary
course of business;
(xvi) take any
action or fail to take any action which would cause the Seller's licenses to
lapse; or
(xvii) make any
material change in the underwriting, contracting, financial or accounting
practices customarily followed by the Seller.
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4.3 Access to Properties and
Records. To permit EMTA and Lumea to make such business, accounting
and legal review and examination of each of the Sellers as EMTA and Lumea shall
reasonably desire, Sellers shall afford to Lumea and its agents, accountants,
counsel and other representatives, access throughout the period prior to the
Closing Date to the business, operations, properties, books, contracts,
commitments and records of the Sellers as Lumea or its representatives shall
reasonably request. Sellers shall cooperate with Lumea and its representatives
in their investigation and examination of the assets and properties of the
Sellers.
4.4 Consents and Approvals.
Each Seller will use its best efforts to promptly obtain all
necessary consents, waivers, authorizations and approvals of all governmental
entities and persons as may be required of Sellers in connection with the
execution, delivery and performance by each in this Agreement and the
transactions contemplated hereby, and shall reasonably assist and cooperate with
Lumea and EMTA in preparing and filing all documents required to be submitted by
Lumea or EMTA to any governmental entity in connection with such transactions
(which assistance and cooperation shall include, without limitation, timely
furnishing to Lumea and EMTA all information concerning the Sellers which, in
the reasonable opinion of counsel to Lumea or EMTA, as applicable, is required
to be included in such documents), and in obtaining any governmental, or other
third party consents, waivers, authorizations or approvals which may be required
to be obtained by Lumea or EMTA in connection with such
transactions.
4.5 Further
Assurances. Upon the reasonable request of Lumea at any time on or
after the Closing Date, Sellers will execute and deliver such further
instruments of assignment, transfer, conveyance, endorsement, direction or
authorization and other documents as Lumea or its counsel may reasonably request
in order to perfect title of Lumea and its successors and assigns in and to
otherwise effect the purposes of this Agreement.
4.6 Notice and
Cure. Sellers will notify Lumea promptly in writing of, and
contemporaneously will provide Lumea with true and complete copies of any and
all information or documents relating to, and will use all commercially
reasonable efforts to cure before the Closing, any event, transaction, or
circumstance occurring after the date of this Agreement, that causes or will
cause any covenant or agreement of Sellers under this Agreement to be breached,
or that renders or will render untrue any representation or warranty of Sellers
contained in this Agreement as if the same were made on or as of the date of
such event, transaction, or circumstance.
ARTICLE
V
CLOSING
CONDITIONS
5.1 Conditions to Obligation of
Lumea. The obligations of Lumea to consummate the transactions to
be performed by it in connection with the Closing is subject to satisfaction of
the following conditions:
(i)
the
representations and warranties set forth in Article II above shall be true and
correct in all material respects at and as of the Closing Date;
(ii)
the
Sellers shall have performed and complied with all of their covenants hereunder
in all material respects through the Closing;
(iii)
there
shall not be any injunction, judgment, order, decree, ruling, or charge in
effect preventing consummation of any of the transactions contemplated by this
Agreement; and
(iv) all
actions to be taken by the Sellers in connection with consummation of the
transactions contemplated hereby and all certificates, opinions, instruments,
and other documents required to effect
the transactions contemplated hereby will be reasonably satisfactory in form and
substance to the Lumea.
9
Lumea may
waive any condition specified in this Section if it executes a writing so
stating at or prior to the Closing.
5.2 Conditions to Obligation of
the Sellers. The obligation of the Sellers to consummate the
transactions to be performed by it in connection with the Closing is subject to
satisfaction of the following conditions:
(i) the
representations and warranties set forth in Article III above shall be true and
correct in all material respects at and as of the Closing Date;
(ii) each of
Lumea and EMTA shall have performed and complied with all of its covenants
hereunder in all material respects through the Closing;
(iii) there
shall not be any injunction, judgment, order, decree, ruling, or charge in
effect preventing consummation of any of the transactions contemplated by this
Agreement;
(iv) Lumea
shall have executed and delivered the Employment Agreement set forth on Annex E and the same
shall be in full force and effect;
(v) Lumea
shall have executed and delivered to Easy the Promissory Note;
(vi) Lumea
shall have delivered to Easy the EMTA Shares; and
(vii) EMTA, as
sole shareholder of Lumea, shall have executed the Action by Unanimous Written
Consent of the Board of Directors and Shareholders of Lumea attached as Annex F to appoint
each of Xxxxxx Xxxxxxxx, Xxxxx Xxxxx and Xxxxx Xxxxxxxx as the sole members of
the board of directors of Lumea; and
(viii) all
actions to be taken by Lumea in connection with consummation of the transactions
contemplated hereby and all certificates, opinions, instruments, and other
documents required to effect the transactions contemplated hereby will be
reasonably satisfactory in form and substance to the Sellers.
The
Sellers may waive any condition specified in this Section if it executes a
writing so stating at or prior to the Closing.
ARTICLE
VI
INDEMNIFICATION
6.1 Indemnification of
Sellers. Lumea agrees to indemnify Sellers and hold them harmless
against and in respect of any and all damages, claims, losses, expenses, costs,
obligations and liabilities (including reasonable attorneys' fees)
(collectively, the "Sellers'
Losses") which result from (i) the failure of Lumea to discharge the
Assumed Liabilities; (ii) Lumea's ownership, operation or control of the
Acquired Assets; or (iii) any act or omission of Lumea, its employees or agents
taken after the Closing Date.
6.2 Indemnification of
Lumea. Sellers agree to indemnify Lumea and hold it harmless
against and in respect of any and all damages, claims, losses, expenses, costs,
obligations and liabilities (including reasonable attorneys' fees)
(collectively, the "Lumea
Losses") which result from (i) Sellers' ownership,
operation or control of the Acquired Assets prior to the Closing Date (excluding
any Assumed Liabilities); or (iii) any act or omission of Sellers, their
employees or agents taken after the Closing Date.
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6.3 Procedure for
Indemnification. The indemnified party shall notify the
indemnifying party of the claim in writing, describing the claim, the amount
thereof, and the basis therefor. The party from whom indemnification is sought
shall respond to each such claim within 30 days of receipt of such notice.
Failure to so respond within such time period shall constitute an admission of
liability for the claim or claims to which the notice related. No action shall
be taken pursuant to the provisions of this Agreement or otherwise by the party
seeking indemnification until the later of (a) the expiration of the 30-day
response period (unless reasonably necessary to protect the rights of the party
seeking indemnification) or (b) 30 days following the termination of the 30-day
response period if a response received within such 30-day period by the party
seeking indemnification requested an opportunity to cure the matter giving rise
to indemnification (and, in such event, the amount of such claim for
indemnification shall be reduced to the extent so cured within such 30-day cure
period). If such demand is based on a claim by a third party, the indemnifying
party shall have the right to assume the entire control of the defense,
compromise or settlement thereof, including at its own expense, employment of
counsel satisfactory to the indemnified party, and, in connection therewith, the
party claiming indemnification shall cooperate fully to make available to the
defending party all pertinent information under its control. No claim for
indemnification resulting from the breach or falsity or any of the
representations or warranties set forth herein or in any certificate or other
instrument delivered pursuant hereto shall be made after a date on which the
claim period for such representation, warranty or agreement shall have expired
under the provisions of Section 7.1 hereof.
6.4 Guarantee by
EMTA. EMTA hereby irrevocably and unconditionally guarantees
the performance of Lumea pursuant to this Article VI.
ARTICLE
VII
MISCELLANEOUS
PROVISIONS
7.1 Survival. The
respective representations, warranties, covenants, agreements and
indemnification obligations of each of the parties to this Agreement shall
survive the Closing Date and the consummation of the transactions contemplated
by this Agreement for a period of one (1) year from and after the Closing
Date.
7.2 Publicity and
Non-Disclosure. Prior to the Closing, neither party shall issue any
press release or other announcement or otherwise solicit publicity with respect
to this Agreement or the transactions contemplated hereby without the consent of
the other party hereto, except with respect to the obligations of EMTA to make
such disclosures and public announcements as are required by applicable
law.
7.3 Assignment;
Delegation. No party may assign any of its rights under this
Agreement, or delegate any performance under this Agreement, in whole or in
part, whether they are voluntary, involuntary, by merger, consolidation,
dissolution, operation of law, or any other manner, except with the prior
written consent of the other party, which consent may be withheld for any reason
or no reason. For purpose of this Section: (i) a change of control or a change
of ownership is deemed an assignment of rights; and (ii) "merger" refers to any
merger in which a party participates, regardless of whether it is the surviving
or disappearing corporation. Any purported assignment of rights or delegation of
performance in violation of this Section is null and void.
7.4 Successors and
Assigns. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective successors, heirs,
representatives and assigns, as the case may be;
provided, however, that no party shall assign or delegate this Agreement or any
of the rights or obligations created hereunder without the prior written consent
of the other party. This Agreement shall not confer upon any person not a party
to this Agreement, or the legal representative of such person any rights or
remedies of any nature or kind whatsoever under or by reason of this
Agreement.
11
7.5 Expenses.
Except as otherwise expressly provided in this Agreement, the parties
hereto shall bear their respective expenses incurred in connection with the
preparation, execution and performance
of this Agreement and the transactions contemplated hereby, including, without
limitation, all fees and expenses of agents, representatives, counsel and
accountants.
7.6 Notices. All
notices and other communications given or made pursuant hereto shall be in
writing and shall be deemed to have been given or made, if delivered personally
or transmitted by telex, telecopy or telegram, on the date so delivered or
transmitted, if sent by Federal Express or other reputable national overnight
carrier, on the next business day after the date so sent, or if mailed by
registered or certified mail (postage prepaid, return receipt requested), on the
fifth business day after the date so mailed, to the parties at the following
addresses.
(a) if to Sellers, to: Easy Staffing
Services, Inc.
(b) if to Lumea, to: ESSI,
Inc.
Easy
Staffing Solutions, Inc. Xxxxxxxxxx, XX 00000
Attention:
Xxxxx Xxxxx, President
Lumea,
Inc
0000 X.
Xxxxxxxx Xx., Xxxxx X Xxxxxxxxxx, Xxxxxxx 00000
Attention:
Xx. Xxxxxx X. Xxxxxxxx
or to
such other persons or at such other addresses as shall be furnished by any party
by like notice to the other, and such notice or communication shall be deemed to
have been given or made as of the date so delivered or transmitted, on the next
business day after the date so sent by overnight courier or on the fifth
business day after the date so mailed.
7.7 Entire
Agreement. This Agreement, together with the Annexes and Exhibits
attached hereto, represents the entire agreement and understanding of the
parties hereto with reference to the transactions set forth herein, and no
representations, warranties or covenants have been made in connection with this
Agreement, either express or implied, other than those expressly set forth
herein, in the Annexes or in the certificates, agreements and other documents
delivered in connection with the transactions contemplated hereby. This
Agreement supersedes all prior negotiations, discussions, correspondence,
communications, understandings and agreements between the parties relating to
the subject matter of this Agreement and all prior drafts of this Agreement, all
of which are merged into this Agreement.
7.8 Third Parties.
No term or provision of this Agreement is for the benefit of any person who is
not a party hereto, and no such party will have any right or cause of action
hereunder.
7.9 Waivers, Amendments and
Remedies. This Agreement may be amended, superseded, canceled,
renewed or extended, and the terms hereof may be waived, only by a written
instrument signed by Sellers and Lumea or, in the case of a waiver, by the party
waiving compliance. No delay on the part of any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof; nor shall any
waiver on the part of any party of any such right, power or privilege, nor any
single or partial exercise
of any such right, power or privilege, preclude any further exercise thereof or
the exercise of any other such right, power or privilege.
12
7.10 Section
Headings. The Section headings contained in this Agreement are
solely for convenience of reference and shall not affect the meaning or
interpretation of this Agreement or of any term or provision
hereof.
7.11 Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original and all of which together shall be considered one and the
same agreement.
7.12 Facsimile and Electronic
Signatures. Signatures received via facsimile or other electronic
means, including in a digitally produced format (.tif, .pdf, .doc, .gif., etc.),
will be deemed originals, unless otherwise expressly set forth in a clear and
conspicuous manner elsewhere on the page or file that contains the facsimile or
electronic signature.
7.13 Enforcement
Costs. If either party institutes an action or
proceeding to enforce any rights arising under this Agreement, the party
prevailing in such action or proceeding will be paid all reasonable attorneys'
fees and costs to enforce such rights by the other party, such fees and costs to
be set by the court, not by a jury, and to be included in the judgment entered
in such proceeding.
7.14
Governing
Law. This Agreement is made in and shall be governed by and
construed in accordance with the laws of the State of Arizona without giving
effect to the principles of conflicts of law thereof.
7.15 Annexes, Exhibits and
Schedules. The Annexes, Exhibits and Schedules attached hereto are
a part of this Agreement as if fully set forth herein. All references herein to
Sections, Clauses, Annexes, Exhibits and Schedules shall be deemed references to
such parts of this Agreement, unless the context shall otherwise require. Any
description or disclosure set forth in any attachment hereto shall be deemed
incorporated in all other attachments hereto to the extent
applicable.
[remainder
of page intentionally left blank]
13
IN
WITNESS WHEREOF, Sellers, Lumea and EMTA have caused this Agreement to be duly
executed as of the
10th day of March 2009.
|
EASY STAFFING SERVICES,
INC.,
a Delaware corporation
|
LUMEA,
INC.,
a Nevada corporation
|
||||
|
By:
|
/s/
Xxxxx Xxxxx
|
By:
|
/s/ Xxxxxx X. Xxxxxxxx | ||
|
ESSI,
INC.,
a Delaware corporation
|
a Nevada corporation
|
||||
|
By:
|
/s/
Xxxxx Xxxxx
|
By:
|
/s/ Xxxxxx X. Xxxxxxxx | ||
|
EASY
STAFFING SOLUTIONS, INC.,
f/k/a
Xxxxxx Placement Services, Inc.
an
Illinois corporation
|
|
||||
|
By:
|
/s/
Xxxxx Xxxxx
|
|
|||
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