EXHIBIT 10.1
CUSTOMER LIST PURCHASE AGREEMENT
BY AND BETWEEN
Computech Print Solutions, Inc, a Nevada corporation,
as
"SELLER"
and
American TonerServ Corp.
as
"BUYER"
CUSTOMER LIST PURCHASE AGREEMENT
This Customer List Purchase Agreement ("Agreement") is effective made as of
this 5th day of July, 2006 ("Effective Date") by and between Computech Print
Solutions, Inc, a Nevada corporation ("Seller"), with its principal place of
business located at 0000 Xxxxxxxx Xx., Xxxxxxx Xxxxxxx, XX. 00000
(hereinafter referred to as the "Business Premises"), and American TonerServ
Corp., a Delaware corporation ("Buyer").
RECITALS
A. Seller is the owner and operator of Computech Print Solutions, Inc
(the "Business") which is located on the Business Premises.
B. Seller is desirous of selling and conveying its customer list of
the Business to Buyer.
C. Buyer is desirous of acquiring said customer list of the Business.
D. The parties have reached an understanding with respect to the terms
and considerations of the foregoing and are desirous of memorializing the
same herein;
AGREEMENT
NOW, THEREFORE, in consideration of the terms, covenants and conditions
hereinafter set forth, the parties hereto agree as follows:
1. Purchase and Sale of Customer List. Seller agrees to sell, convey,
assign, deliver and transfer to Buyer, and Buyer agrees to purchase and
acquire from Seller the Customer List ("the Asset") of the Business. The
Customer List is attached hereto on Schedule 1.
2. Buyer's Due Diligence. Seller has made available to Buyer (its
counsel, accountants and other representatives) for Buyer's review and
copying all information available to Seller regarding the Customer List and,
without limitation, all disclosures required by law. Commencing on the
Effective Date and continuing for a period satisfactory to the Buyer but no
longer than the day Buyer pays the purchase price or accepts possession of
the Customer List (the "Due Diligence Period"), Buyer has the right to
inspect and approve all other documents regarding or relating to the
Customer List that Buyer reasonably desires to review.
3. Assumption of Liabilities. Buyer will assume no liabilities,
obligations, expenses or other commitments of the Seller.
4. Purchase Price and Payment of Purchase Price. As full payment and
consideration for the purchase of the Asset, Buyer agrees to pay Seller
$292,000 (referred to herein as the "Purchase Price") in consideration as
described below.
* The Buyer would pay $30,000 in cash at closing and $20,000 on
August 31, 2006.
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* The Buyer shall issue a two year non-interest-bearing contingent
convertible note for $242,000.
* If the gross margin is above $220,000 for any fiscal year
during the first two years a year end bonus would be paid equal
to 30% of gross margin in excess of $220,000. "Gross Margin"
is defined as revenue less the cost of goods sold attributable
to the sales generated from the Customer List and other new
customers assigned to the Holder. The cost of goods sold shall
be computed using GAAP rules.
5. Closing. The Closing shall occur when Buyer pays the amount due at
Closing or takes possession of the Customer List.
6. Confidentiality. The parties agree that the financial terms and
conditions of this Agreement including, but not limited to, any and all
information provided by Buyer to Seller are strictly confidential. Neither
party will knowingly publicize or disclose or cause or knowingly permit or
authorize the publicizing or disclosure of the financial terms and conditions
of this Agreement for any reason, at any time, without the prior written
consent of the other party. In addition, Buyer shall not disclose any
information obtained from Seller involving the Business or any of the Assets
including any and all financial statements. Notwithstanding the above, the
parties may disclose information to their counsel, personal tax advisor,
their family or as may be required by law. The parties agree, to the extent
not prohibited under law, to instruct those to whom disclosure is allowed
under this Agreement that its terms are confidential and must not be further
disclosed.
7. Uniform Commercial Code Compliance. If necessary, Buyer agrees
that it will publish notice to creditors as required by and in the form and
manner and within the time provided in California Commercial Code and
otherwise comply with Division 6 of the California Commercial Code, of any
bulk transfer contemplated by this Agreement.
8. Obligation Not to Solicit.
a. Non-Solicitation. Seller agrees not to solicit any of the
customers on the Customer List, or otherwise seek to hire, cause, encourage,
or attempt to encourage (i) any former, current or future sales agent or
employee of the Buyer or any successor thereto, or (ii) any current or former
sales agent or employee of Seller to become a sales agent or employee of any
other person or entity (other than the Buyer or an affiliate or successor
thereof) engaged in the toner cartridge business within the United States of
America.
b. Term of Non-Solicitation Obligation. The obligations of
Seller not to solicit as set forth in this Section shall continue for a
period of five (5) years from the Effective Date.
9. Representation and Warranties of Buyer. Buyer warrants and
represents to Seller:
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(a) That the within Agreement is a valid and binding obligation of
Buyer, and that Buyer has the ability to enter into and consummate this
Agreement; and
(b) That Buyer shall, at closing, have the funds necessary to
consummate the transaction contemplated by this Agreement.
10. Representation and Warranties of Seller. Seller warrants and
represents to Buyer:
a. Authority. Seller has full power and authority to execute and
deliver this Agreement and to perform the obligations hereunder. This
Agreement as delivered at the Closing, to which the Seller is a signatory,
will be duly authorized, executed and delivered by, and a valid and binding
agreement of, the Seller who is a signatory thereto, enforceable in
accordance with their respective terms, and no further action, approvals or
consents are necessary on the part of the Seller, nor is it necessary for the
Seller to obtain any actions, approvals or consents from any third persons,
governmental or other to make this Agreement valid and binding upon and
enforceable against the Seller in accordance with their respective terms, or
to enable the Seller to perform this Agreement and the transactions
contemplated thereby.
b. Undisclosed Liabilities. To the best of Seller's knowledge,
there are no liabilities or obligations, secured or unsecured (whether
absolute, accrued, contingent, or otherwise, and whether due or to become
due), of Seller of a nature required by generally accepted accounting
principles to be reflected in a balance sheet, except such liabilities and
obligations that either: (a) are disclosed by, or accrued or reserved
against in, the most recent balance sheet; or (b) have arisen or been
incurred in the ordinary course of business since the most recent balance
sheet date and which did not and will not have a material adverse effect on
the financial condition, operations, sales, gross margins, operating results,
assets, customer relations, employee relations or prospects of Seller .
c. Customer List. The Customer List attached hereto is a full and
complete list of the customers of Seller
d. Title and Quiet Enjoyment. Seller has, and at the Closing will
convey to Buyer, good and marketable title to the Customer List, free and
clear of all liens, pledges, leases, charges, encumbrances, equities, claims,
conditional sale contracts, security interests, or any other interests or
imperfections of title of any nature whatsoever.
e. Compliance with Law. To the best of Seller's knowledge, Seller
has not been and is not now in violation of any federal, state or local laws,
regulations or orders.
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f. Litigation and Proceedings. There are no claims, actions,
suits, proceedings or investigations, judicial or administrative, pending,
involving or, to the best knowledge of either Seller, threatened against or
affecting either Seller or the Customer List or which seek to restrain,
prohibit or invalidate the transactions contemplated by this Agreement or
which might materially affect the right of Buyer to own The Customer List.
Seller does not know of any basis for any such action, suit, proceeding or
investigation.
g. Representations and Warranties. There are no other
representations and warranties by Seller other than as set forth in this
Agreement.
11. Covenants of Seller Pending Closing. Seller covenants and agrees
that, from and after the execution and delivery of this Agreement and through
the Closing Date:
a. Representations, Warranties and Covenants True as of Closing
Date. All of the representations, warranties and covenants of Seller
contained in the foregoing paragraphs hereof shall be true and correct, and
shall not have been breached, on and as of the Closing. All of the
representations, warranties and covenants contained in the foregoing
paragraphs shall survive the Closing.
b. Conduct of Business in Ordinary Course. Seller will continue
to carry on its business in the ordinary course diligently and substantially
in the same manner as heretofore conducted. Seller will not take any action
that would cause any of the representations and warranties made by Seller in
this Agreement not to be true and correct in all material respects on and as
of the Closing Date, with the same force and effect as if made on and as of
the Closing Date. Seller will use commercially reasonable efforts to
preserve the Seller's business intact and to preserve the Seller's
relationships with employees, customers, clients, vendors, representatives,
agents, creditors, subcontractors and suppliers and others having business
relationships with Seller and/or the business. The other, more specific
provisions of this Section shall in no way limit the generality of this
subsection.
c. Sale of Customer List. Seller will not sell or otherwise
transfer, or grant any security or other interest in, the Customer List to
any other person or entity other than sales of inventory in the ordinary
course of business.
12. Representations, Warranties and Covenants True as of Closing Date.
All of the representations, warranties and covenants contained in paragraph
10 hereof shall be true and correct, and shall not have been breached, on and
as of the closing date. All of the representations, warranties and covenants
contained in paragraph 10 shall survive the closing.
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13. Attorneys, Brokers, Consultants. The parties hereto warrant that no
person or entity can properly claim a right to a commission, finder's fee, or
other compensation based upon the acts of that party with respect to the
purchase and sale contemplated herein and each party hereby agrees to
mutually indemnify and hold the other harmless from any and all claims,
liabilities, costs, including attorney fees, expense and commissions,
resulting from any claim for a commission, fee or other compensation by any
party or entity based upon those acts.
14. Seller Indemnification.
a. In the event Seller breaches (or in the event any third party
alleges facts that, if true, would mean Seller has breached) any of its
representations, warranties or covenants contained in this Agreement, then
Seller will indemnify Buyer from and against the entirety of any and all
Adverse Consequences Buyer may suffer to the extent resulting from, arising
out of, relating to, or caused by the breach (or the alleged breach).
b. Seller will indemnify Buyer from and against the entirety of
any Adverse Consequences Buyer may suffer to the extent resulting from,
arising out of, relating to, in the nature of, or caused by any liability not
assumed by Buyer (including but not limited to any liability of Seller that
becomes a liability of Buyer under any bulk transfer law of any jurisdiction,
under any common law doctrine of de facto merger or successor liability, or
otherwise by operation of law).
c. Seller will indemnify Buyer from and against the entirety of
any Adverse Consequences Buyer may suffer to the extent resulting from,
arising out of, relating to, or caused by, any lawsuit or other legal
proceeding to which the Seller is now, or may hereafter become, a party
provided such lawsuit or legal proceeding relates to the business prior to
closing and is not related to an obligation assumed by Buyer under this
Agreement.
d. If the consent of any person or entity to the assignment of any
of the contract by Seller to Buyer as contemplated by this Agreement is
required by the terms of such contract, and such consent has not been
obtained by Seller and delivered to Buyer at or prior to the Closing, Seller
will indemnify Buyer from and against the entirety of any Adverse
Consequences Buyer may suffer to the extent resulting from, arising out of,
relating to, or caused by the failure of Seller to obtain such consent prior
to the Closing.
15. Headings. The "headings" contained in this agreement are for the
purposes of expediency and are not intended to otherwise bind the parties or
interpret the content of the paragraph language they precede.
16. Notices. Any notice, communication, request, reply or advice or
other notice pertaining to this agreement to be given, made or accepted by
either party to the other must be in writing and shall be given or be served
only by dispatching the same by Federal Express (or any other overnight
courier delivery service), and such notice so dispatched shall become
effective on the date of receipt, or by United States Certified mail and
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addressed to the party to be notified, with return receipt requested, and
receipted by the postal authority and such notice so dispatched shall be
effective seven (7) days after the date it is so dispatched. For purposes
thereof, the addresses of the parties set forth on the signature page of this
Agreement.
17. Survivorship. The representatives, covenants and obligations of the
parties as set forth in this Agreement shall survive the closing of the title
hereunder.
18. Binding Effect. All of the terms, covenants and conditions herein
contained shall be for and shall inure to the benefit of and shall bind the
respective parties hereto and their successors and assigns, respectively.
19. Assignment to Corporation. This Agreement may be assigned by Buyer
to a corporation or partnership controlled by Buyer in place and instead of
Buyer; however, Buyer shall not, upon such assignment, be relieved of
performance hereunder and pursuant to the provisions hereof.
20. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of California.
21. Arbitration. Any controversy involving the construction or
application of any of the terms, provisions or conditions of this Agreement
shall, on the written request of either party served on the other, be
submitted to binding arbitration without the right to a trial de novo,
subject to the California Rules of Court and the Local Rules of the
applicable Superior Court relating to judicial arbitration. The cost of
arbitration shall be borne by the losing party or in such proportions as the
arbitrator shall decide.
{signature page follows}
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IN WITNESS WHEREOF, the parties hereto have executed this Asset Purchase
Agreement dated and effective as of the date first set forth above.
SELLER: Computech Print Solutions, Inc BUYER: American TonerServ Corp.
By: /s/ Xxx Xxxxx By: /s/ Xxxxxx Xxxxxxx
Xxx Xxxxx, President Xxx Xxxxxxx, President & CEO
Address: Address:
0000 Xxxxxxxx Xx. 000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxxxx, XX 00000 Xxxxx Xxxx, XX 00000
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