1/14/00
TECHNOLOGY PURCHASE
This TECHNOLOGY PURCHASE AND RESCISSION AGREEMENT (this "Agreement") is
made this 14 day of January 2000(the "Effective Date") by and between 1st Net
Technologies, Inc., a Colorado corporation ("1st Net" or "Buyer"), and Spirit
32 Development Corporation, a Colorado corporation ("Spirit 32" or "Seller"),
with reference to the facts set forth in the Recitals below:
RECITALS
Buyer and Seller are parties to that certain Stock Acquisition Agreement
dated January 22, 1999, (the "Stock Acquisition Agreement") pursuant to which,
inter alia, Buyer was to acquire all of Seller's stock; and
Buyer and Seller acknowledge that Buyer has funded certain technology
development activities and network services of Seller since August 1998 in the
amount of approximately $587,000.00 in anticipation and understanding that the
buyer would be acquiring the certain Technologies referenced in Section 1.1
below.
Buyer and Seller now wish to terminate and rescind the Stock Acquisition
Agreement as of its date and, instead, Seller wishes to sell and Buyer wishes
to buy certain of Seller's Technologies in accordance with the terms and
conditions set forth herein; and
In connection with, and as a condition of, entering into this Agreement
and the consummation of the transactions contemplated hereby, Buyer and Seller
wish to provide for certain releases as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants set forth herein
and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto agree as follows:
1. Sale and Transfer of Assets; Closing.
1.1 Technologies. Subject to the terms and conditions of this
Agreement, at the Closing, Seller will sell, convey and transfer to Buyer, and
Buyer will purchase from Seller, the following Technologies (the
"Technologies"):
All of Seller's right, title and interest to the Mariah Internet
Protocol Telecomputing Project, the MindWalker Series, the Crayon Crawler
Browser, the Spirit 32 Voice Mailer and all of the tradenames and copyrights
associated with the names "Crayon Crawler," "Mindwalker" and "Mariah."
Buyer takes said Technologies "as is" without warranty of any kind either
expressed or implied.
1.2 Closing. The purchase and sale (the "Closing") provided for in this
Agreement will take place at the offices of Buyer, 00000 Xxxx Xxxxxxxx Xxxxx,
Xxx Xxxxx, Xxxxxxxxxx on or before February 14, 2000 at 10:00 a.m. (local
time), or at such other time and place as the parties may agree (the "Closing
Date").
1.3 Closing Obligations. At the Closing:
(a) Seller will deliver to Buyer instruments of conveyance and
assignment in the form attached hereto with respect to the transfer of the
Technologies to Buyer; and
(b) Buyer will deliver to Seller the full purchase price to be paid
by Buyer for the Technology being purchased herein by delivery to Seller of
250,000 shares of Buyer's restricted common stock and $100,000 USD.
(c) Seller will perform the following tasks prior to the closing of
this Agreement:
1) The latest, most current version of the Server software delivered to
Buyer.
3) Update the Registration screen to include the credit card information.
4) Update database to accept credit card information.
5) Deliver IEAK for the Crayon Crawler with IDT dial-up.
6) Deliver IEAK script used.
7) Deliver Crayon Crawler server (hardware).
8) An install routine that will launch default dialer if user not online.
Regarding Kola contract:
1) Completion of the Kola application.
2) Deliver Source code for the Kola application.
3) Deliver IEAK including script for Kola.
4) Deliver XXXX xxxx Install script and wise installer.
2. Representations and Warranties of Seller.
Seller represents and warrants to Buyer as follows:
2.1 Organization and Good Standing. Seller is a corporation duly
organized, validly existing, and in good standing under the laws of Colorado,
with full corporate power and authority to conduct its business as it is now
being conducted and is not currently contemplating any filing for protection
under any bankruptcy, receivership or similar laws.
2.2 Authority; No Conflict.
(a) This Agreement constitutes the legal, valid and binding
obligation of Seller, enforceable against Seller in accordance with its terms.
Seller has the absolute and unrestricted right, power, authority and capacity
to execute and deliver this Agreement and to perform its obligations
hereunder.
(b) Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the transactions contemplated hereby
will, directly or indirectly (with or without notice or lapse of time)
contravene, conflict with or result in a violation of:
(i) any provision of the Articles of Incorporation or Bylaws
of Seller, or any resolution adopted by the board of directors or the
shareholders of Seller;
(ii) any legal requirement or any order to which the Seller, or
any of the assets owned or used by Seller, may be subject; or
(iii) any material Contract of Seller.
(c) Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the transactions contemplated hereby
will, directly or indirectly (with or without notice or lapse of time) result
in the imposition or creation of any encumbrance upon or with respect to any
of the Technologies.
(d) Seller is not and will not be required to give any notice to or
obtain any consent from any person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
transactions contemplated hereby.
2.3 Title and Encumbrances. Seller has valid title to and possession of
the Technologies free and clear of all encumbrances.
2.4 Investment Intent. Seller has experience in making investments of
this type and is acquiring the shares of the Buyer to be delivered at Closing
for its own account and not with a present view to, or for sale in connection
with, any distribution thereof in violation of the registration requirements
of the Securities Act of 1933, as amended. The Seller consents to the placing
of a legend on the certificates representing the shares to be delivered by
Buyer at Closing to the effect that the shares have not been registered under
the Securities Act and may not be transferred except in accordance with
applicable securities laws or an exception there from.
2.5 Suitability. Seller acknowledges that there is an economic risk.
Seller warrants that their business and/or financial experience, can be
reasonably assured to have the capacity to protect their own interests.
2.6 Risks. Seller acknowledges that this investment is speculative in
nature and involves a high degree of risk in that the Seller may not be able
to liquidate this investment and that transferability is extremely limited.
3. Representations and Warranties of Buyer. Buyer represents and
warrants to Seller as follows:
3.1 Organization and Good Standing. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Colorado.
3.2 Authority; No Conflict.
(a) This Agreement constitutes the legal, valid and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms.
Buyer has the absolute and unrestricted right, power and authority to execute
and deliver this Agreement and to perform its obligations hereunder.
(b) Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the transactions contemplated hereby
will contravene, conflict with, result in a violation of or give any Person
the right to prevent, delay, or otherwise interfere with any of the
transactions contemplated hereby pursuant to:
(i) any provision of Buyer's Articles of Incorporation or
Bylaws;
(ii) any resolution adopted by the board of directors or the
shareholders of Buyer;
(iii) any legal requirement or order to which Buyer may be
subject; or
(iv) any material contract to which Buyer is a party or by
which Buyer may be bound.
(c) Buyer is not and will not be required to obtain any consent
from any person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the transactions
contemplated hereby.
4. Termination of January 22, 1999 Acquisition Agreement; Consideration.
That certain Stock Acquisition Agreement by and between Buyer and Seller dated
January 22, 1999(the "Stock Acquisition Agreement"), is hereby mutually
terminated and is of no further force or effect whatsoever without either
party having recourse against the other pursuant to such Agreement. Each of
the parties hereto hereby fully and finally terminates, settles, discharges
and releases all past and present claims, controversies, demands, actions, or
causes of action which either party may have or claim to have against the
other, which arise out of or are in any way related to the Stock Acquisition
Agreement.
5. Release. Each of Buyer and Seller, on behalf of themselves and each
of their respective subsidiary and parent corporations, partnerships, business
entities, officers, directors, employees, personal representatives, successors
and assigns, hereby forever releases and discharges each other and each of
their past and present officers, directors, shareholders, principals, joint
ventures, partners, trustees, employees, agents, personal representatives,
successors and assigns, and all entities presently or formerly related to or
affiliated in any way with the other, and any and all persons, predecessors,
firms, associations, insurers, attorneys, limited partnerships or
corporations, and their respective heirs, successors and assigns, and each of
them, with whom the other was, are or may hereafter be, affiliated or
associated in any manner, of and from any and all claims, demands, damages,
actions, causes of action of every kind incurred or caused prior to the
Effective Date in law, equity or otherwise, known or unknown, suspected or
unsuspected, disclosed or undisclosed, for damages actual, consequential or
exemplary, past, present and future, arising out of or in any way related to
their obligations, activities and/or dealings with each other or their
affiliates at any time prior to the Effective Date, including without
limitation all claims and demands arising out of or in any way related to the
Stock Acquisition Agreement and the circumstances thereof.
6. Miscellaneous.
6.1 Publicity. All notices to third parties and all other publicity
concerning the transactions contemplated by this Agreement shall be jointly
planned and coordinated by both 1st Net and Spirit 32. Neither party shall
act unilaterally in this regard without the prior express written approval of
the other; provided, however, this approval shall not be unreasonably
withheld.
6.2 Assignment. This Agreement shall be binding on, and shall inure to
the benefit of, the parties and their respective heirs, legal representatives,
successors and assigns.
6.3 Survival of Representations and Obligations. All representations,
warranties, covenants and agreements of the parties contained in this
Agreement, or in any instrument, certificate, opinion or other writing
provided for in it, shall survive the Effective Date.
6.4 Finality. It is understood that this Agreement is a full and final
release of any and all claims described above, and the parties expressly agree
that it shall apply to all unknown, unanticipated, unsuspected and undisclosed
claims, demands, liabilities, actions or causes of action, as well as those
which are now known, anticipated, suspected or disclosed.
6.5 No Admission. It is expressly understood and agreed that this is a
compromise settlement of disputed claims. The consideration given for the
release contained in this Agreement shall not be construed to be an admission
of liability by, or to, either party or any other person whomsoever. The
representations of facts set forth in the Recitals shall not be admissible in
any court of law.
6.6 Nonwaiver. No failure by a party to take action by reason of any
default by the other party, whether in a single instance or repeatedly, shall
constitute a waiver of any such default or of the performance required of the
defaulting party. No express waiver by a party of any provision of this
Agreement or a default by the other party in any one instance shall be
construed as a waiver of the same provision or default in any subsequent
instance.
6.7 Attorneys; Attorneys' Fees. If any action is instituted among the
parties related to this Agreement, the prevailing party or parties shall be
entitled to recover from the losing party or parties all of the prevailing
party's costs and expenses, including court costs and reasonable attorneys'
fees.
6.8 Nature of Agreement. This Agreement constitutes the entire and whole
agreement between the parties and supersedes any prior agreements between the
parties. This Agreement may not be modified or amended except by a written
instrument, signed by the parties expressing such amendment or modification.
6.9 Choice of Law. Except as otherwise expressly provided, this
Agreement and the respective contractual obligations of the parties incurred
hereunder shall be governed by and construed in accordance with the laws of
the State of Colorado pertaining to agreements between Colorado residents to
be entered into, and fully performed, in Colorado, without reference to
principles of conflicts of law.
6.10 Venue and Jurisdiction. For purposes of venue and jurisdiction,
this Agreement shall be deemed made and to be performed in the City and County
of Denver, Colorado, United States of America. In the event of any litigation
between the parties arising out of or relating to this Agreement, the parties
hereby consent to the exclusive and sole jurisdiction of the United States
District Court for the District of Colorado in Denver, Colorado. In the event
such court determines that it does not have jurisdiction over the parties or
the subject matter of the dispute in question, the parties hereby consent to
the exclusive and sole jurisdiction of the District Court of the City and
County of Denver, Colorado.
6.11 Service of Process. In the event of any litigation related to this
Agreement, the moving party's service of process shall be deemed effective
immediately upon the personal delivery of such process to the other party's
designated agent for service.
6.12 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of any provision of this Agreement.
6.13 Gender and Number. Whenever the context so requires, the masculine
gender herein shall include the feminine or neuter (and vice versa), and the
singular number shall include the plural.
6.14 Notices.
(a) Method of Delivery. Any notice, request, demand, consent,
approval or other communication (hereafter "notice") required or permitted
under this Agreement or by law shall be in writing and delivered by any of the
following: (1) personally delivering the notice to a senior officer or duly
authorized representative of the other party, (2) depositing the notice in the
United States mail, postage prepaid, duly certified (return receipt
requested), (3) sending the notice by private express mail service (with
return receipt or proof of delivery), or (4) sending the notice by electronic
facsimile (fax).
(b) Addresses. Notices shall be addressed as follows:
If to Buyer: 1st Net Technologies, Inc.
00000 Xxxx Xxxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Mr. Xxxxx Xxxxxx
Telecopier: (000) 000-0000
With a copy to: Xxxx Xxxxx Xxxxxxxx & Xxxxxx, P.C.
000 00xx Xxxxxx, Xxxxx 0000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Telecopier: (000)000-0000
If to Seller: Spirit 32 Development Corporation
00000 X. Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxxx X. Writer
Any party may, from time to time, by written notice to the other, designate a
different address that shall be substituted for that specified above.
6.15 Effectiveness. All notices shall be deemed effective upon receipt.
If personally delivered, notices shall be deemed received at the time of
delivery. If sent by mail, the notice shall be deemed fully delivered and
received three (3) business days after the date of the postmark on the
certified mail receipt. If sent by private express mail service, the notice
shall be deemed fully delivered and received three (3) business days after the
date of deposit with such express mail service. If sent by telex, telegram,
fax or other electronic means of communication, notices shall be deemed
received twenty-four (24) hours after transmission. Rejection or other
refusal to accept a notice or the inability to deliver the same because of a
changed address of which no notice was given shall be deemed to be receipt of
the notice sent. In the event of a postal strike, all notices shall be
personally delivered, sent by private express mail service, or sent by telex,
telegram, fax or other electronic means of communication.
6.16 Legal Fees and Costs. In the event a dispute arises under this
Agreement, the prevailing party shall be entitled to recover its expenses,
including attorneys' fees and accounting fees, in addition to any other relief
to which it is found entitled.
6.17 Severability. In the event that any provision of this Agreement,
in whole or in part (or the application of any provision to a specific
situation), is held to be invalid or unenforceable by the final judgment of an
arbitration panel and/or a court of competent jurisdiction after appeal or the
time for appeal has expired, such invalidity shall be limited to such specific
provision or portion thereof (or to such situation), and this Agreement shall
be construed and applied in such manner as to minimize such unenforceability.
This Agreement shall otherwise remain in full force and effect.
6.18 Force Majeure. No party shall be liable for any failure or delay
in performance under this Agreement which is due in whole or in part directly
or indirectly to any cause of any nature beyond the reasonable control of such
party, including, without in any way limiting the generality of the
foregoing, fire, explosion, earthquake, storm, flood, strike, lockout,
activities of a combination of xxxxxxx or other labor difficulties, wars,
insurrection, riot, acts of God or the public enemy, law, act, order, export
or import control regulations, proclamation, decree, regulation, ordinance, or
instructions of local, federal or foreign government or other public
authorities, or judgment or decree of a court of competent jurisdiction (not
arising out of a breach by the party to this Agreement seeking the benefit of
this Section 7.20). In the event of the occurrence of such a cause, the
affected party shall give prompt written notice to the other party, stating
the period of time the same is expected to continue, and shall take all
reasonable measures to ensure that the effects of such cause of force majeure
are kept as minimal as possible.
6.19 Further Assurances. Each party shall execute, acknowledge and
deliver such further instruments, and do all such other acts, as may be
necessary or appropriate in order to carry out the purposes of this Agreement.
6.20 Consents. The consent by one party to any act by the other for
which such consent was required shall not be deemed to imply consent or waiver
of the necessity of obtaining such consent for the same or any similar acts in
the future. No waiver or consent shall be implied from silence or any failure
of a party to act, except as otherwise specified in this Agreement.
6.21 Invalidity of Provision. If any provision of this Agreement as
applied to either party or to any circumstance shall be adjudged by a court of
competent jurisdiction to be void or unenforceable for any reason, the same
shall in no way affect (to the maximum extent permissible by law) any other
provision of this Agreement, the application of any such provision under
circumstances different from those adjudicated by the court, or the validity
or enforceability of this Agreement as a whole.
7. Counterparts. This Agreement may be executed in more than one
counterpart, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.
8. Confidentiality. Neither party to this Agreement shall disclose
the terms and conditions of this Agreement to any third party, nor will either
party issue a press release and/or otherwise disclose the existence of this
Agreement to the media or general public, without the express written consent
of the other. The parties shall work together, in good faith, to issue a
mutually agreeable joint press release. Notwithstanding the foregoing, neither
Seller nor Buyer shall be prevented from disclosing all or part of the
Confidential Information: (a) in a legal proceeding to enforce its rights or
defend itself under this agreement; (b) if it is legally compelled to do so
by oral deposition, interrogatories, request for information or documents,
subpoena, civil investigative demand, or other legal process, or (c) if it is
required to do so by the Securities and Exchange Commission in relation to a
public filing requirement under the Securities Act of 1933 or the Exchange Act
of 1934 provided a request is made to make the material contained within the
filing confidential.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
"SPIRIT 32"
SPIRIT 32 DEVELOPMENT CORPORATION,
a Colorado corporation
By: _________________________________
Name: _______________________________
Title: ______________________________
"1ST NET"
1ST NET TECHNOLOGIES, INC.,
a Colorado corporation
By: _________________________________
Name: _______________________________
Title: ______________________________
