ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of April 4, 2001 (the "Effective Date") by and between Internet
Properties Development Corp., a Nevada corporation (the "Buyer" or "IPDC"), and
XXXXXXX.XXX, INC., a Delaware corporation (the "Seller" or "Xxxxxxx.xxx")
(collectively, the "Parties").
WHEREAS, the Seller owns and operates a website with the uniform
resource locator address XXX.XXXXXXX.XXX (the "URL") and is currently the
registered owner of the xxx.xxxxxxx.xxx domain name and URL;
WHEREAS, the Seller desires to sell, and the Buyer desires to buy, on
the terms and conditions set forth in this Agreement, the xxx.xxxxxxx.xxx URL
and domain name, the Seller's existing registered user database, the Xxxxxxx.xxx
website, and certain other assets relating to the operation and utilization of
the Xxxxxxx.xxx website as set forth herein;
WHEREAS, the Seller and the Buyer have previously executed a letter of
intent dated March 10, 2001 (the "Letter of Intent"); and
WHEREAS, this Agreement constitutes the Definitive Agreement
contemplated by the Letter of Intent setting forth the full and complete
understanding of the terms and conditions under which the Seller shall sell and
the Buyer shall purchase such assets of the Seller.
NOW, THEREFORE, in consideration of the foregoing, the mutual
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:
ARTICLE 1
PURCHASE AND SALE OF ASSETS
1.1 TRANSFERRED ASSETS. Subject to and upon the terms and conditions of
this Agreement, the Seller hereby agrees to sell, assign, transfer, convey and
deliver to the Buyer free and clear of all liens, liabilities and encumbrances,
and the Buyer agrees to purchase from the Seller, the following assets
(collectively, the "Transferred Assets"):
(a) The Internet Domain Name and URL, "xxx.xxxxxxx.xxx" and
all related rights necessary to use, maintain and operate such URL;
(b) Existing Registered User Database of Xxxxxxx.xxx
(approximately 16,000 user names and e-mail addresses), including all data files
and other electronic data relating thereto;
(c) Content currently published on the Xxxxxxx.xxx website;
(d) The software code for the Xxxxxxx.xxx website, which is
currently published at the XXX.XXXXXXX.XXX URL, including a license to the
WebPublish! content and user management software;
ARTICLE 2
PURCHASE PRICE
2.1 PURCHASE PRICE. The purchase price to be paid by the Buyer to the
Seller for the Transferred Assets (the "Purchase Price") shall consist of
$65,000 (sixty-five thousand dollars) in cash.
2.2 PAYMENT TERMS. The Purchase Price shall be paid as follows:
(a) On March 12, 2001, pursuant to the terms of the Letter of
Intent, the Buyer deposited the Purchase Price into the client trust account of
the law firm of Xxxxxx and Xxxxx LLP for this transaction.
(b) The full amount of the Purchase Price shall be released
from the Xxxxxx & Xxxxx LLP client trust account and delivered to the Seller
immediately following execution of this Agreement.
2.2 NO LIABILITIES ASSUMED.
(a) Notwithstanding anything else in this Agreement to the
contrary,: (i) the Buyer shall not assume or otherwise have any obligation to
pay, perform, or discharge any obligations or liabilities of the Seller, whether
disclosed, undisclosed, direct, indirect, fixed, contingent, known, or unknown
and whether incurred in the ordinary course of business or otherwise
(collectively, Liabilities"); and (ii) the Seller shall retain and be solely
responsible for paying, performing, and discharging all Liabilities.
(b) Without limiting the generality of Section 2.2(a), the
Buyer shall have no obligation to any employees of the Seller, liability for
making payments of any kind pursuant to any agreements, arrangements or
understandings with any third parties out of the proceeds from the sale of the
Transferred Assets, or liability for any Taxes (as defined in Section 2.3
below).
2.3 TAXES. The Seller shall pay all Taxes, if any, resulting from the
transfer of the Transferred Assets or the transactions contemplated hereby. For
purposes hereof, "Taxes" shall mean all taxes, however, denominated, including
any interest, penalties or other additions to tax that may become payable in
respect thereof, imposed by any federal, territorial, state, local or foreign
government or any agency or political subdivision of any such government, which
taxes shall include, without limiting the generality of the foregoing, all
income or profits taxes (including, but not limited to, federal income taxes and
state income taxes), payroll and employee withholding taxes, unemployment
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insurance, social security taxes, sales and use taxes, ad valorem taxes, excise
taxes, franchise taxes, gross receipts taxes, business license taxes, occupation
taxes, real and personal property taxes, stamp taxes, environmental taxes,
transfer taxes, workers' compensation, Pension Benefit Guaranty Corporation
premiums and other governmental charges, and other obligations of the same or of
a similar nature to any of the foregoing, which the Seller is required to pay,
withhold or collect.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby makes the following representations and warranties to
the Buyer, as of the date hereof and as of the Closing:
3.1 ORGANIZATION. The Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, with full
corporate power and authority to consummate the transactions contemplated by
this Agreement.
3.2 NON-CONTRAVENTION. The execution and delivery by the Seller of this
Agreement does not, and the performance and consummation by the Seller of the
transactions contemplated hereby will not, conflict with or result in any breach
or violation of or default, termination, forfeiture, or lien under (or upon the
failure to give notice or the lapse of time, or both, result in any conflict
with, breach, or violation of or default, termination, forfeiture, or lien
under) any statute, rule, regulation, or judicial or governmental decree, order,
or judgment, or any agreement, lease, or other instrument, to which the Seller
is subject or the Transferred Assets are subject.
3.3 AUTHORIZATION. The execution and delivery by the Seller of this
Agreement and the consummation of the transactions contemplated hereby have
been, duly and validly authorized by all necessary corporate action on the
Seller's part, and this Agreement is the valid and binding obligation of the
Buyer, enforceable against the Seller in accordance with its terms, except as
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, or similar laws affecting creditors' rights generally, and subject
to general equity principles and to limitations on availability of equitable
relief, including specific performance.
3.4 NO CONSENT REQUIRED. No consent, authorization, or approval of, or
declaration or filing with, any governmental authority, regulatory body, or
court or other tribunal is required for the execution, delivery, or performance
by the Seller of this Agreement or for the consummation of the transactions
contemplated hereby.
3.5 TITLE TO ASSETS. The Seller has good and valid title to the
Transferred Assets free and clear of all mortgages, liens, security interests,
pledges, encumbrances, charges, agreements, claims, restrictions and defects of
title of any kind. The Seller is currently the registered owner of the
xxx.xxxxxxx.xxx domain name and URL.
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3.6 LEGAL PROCEEDINGS. The Seller is not engaged in or a party to, or,
to the knowledge of the Seller, threatened with, any suit, investigation, legal
action or other proceeding before any court, administrative agency, arbitration
panel or other similar authority which relates to the transactions contemplated
by this Agreement, and the Seller knows of no basis for any such suit,
investigation, legal action or proceeding. There are no outstanding orders,
rulings, decrees, judgments or stipulations by or with any court, administrative
agency, arbitration panel or other similar authority which are applicable to the
Transferred Assets or which challenge or otherwise relate to the transactions
contemplated by this Agreement.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer hereby makes the following representations and warranties to
the Seller, as of the date hereof and as of the Closing:
4.1 CORPORATE ORGANIZATION. The Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada,
with full corporate power and authority to consummate the transactions
contemplated hereby.
4.2 NON-CONTRAVENTION. The execution and delivery by the Buyer of this
Agreement does not, and the performance and consummation by the Buyer of the
transactions contemplated hereby will not, conflict with or result in any breach
or violation of or default, termination, forfeiture, or lien under (or upon the
failure to give notice or the lapse of time, or both, result in any conflict
with, breach, or violation of or default, termination, forfeiture, or lien
under) any statute, rule, regulation, or judicial or governmental decree, order,
or judgment, or any agreement, lease, or other instrument, to which the Buyer is
subject.
4.3 AUTHORIZATION. The execution and delivery by the Buyer of this
Agreement and the consummation of the transactions contemplated hereby have been
duly and validly authorized by all necessary corporate action on the Buyer's
part, and this Agreement is the valid and binding obligation of the Buyer,
enforceable against the Buyer in accordance with its terms, except as
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, or similar laws affecting creditors' rights generally, and subject
to general equity principles and to limitations on availability of equitable
relief, including specific performance.
4.4 NO CONSENT REQUIRED. No consent, authorization, or approval of, or
declaration or filing with, any governmental authority, regulatory body, or
court or other tribunal is required for the execution, delivery, or performance
by the Buyer of this Agreement or for the consummation of the transactions
contemplated hereby.
4.5 LEGAL PROCEEDINGS. The Buyer is not engaged in or a party to, or,
to the knowledge of the Buyer, threatened with, any suit, investigation, legal
action or other proceeding before any court, administrative agency, arbitration
panel or other similar authority which relates to the transactions contemplated
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by this Agreement, and the Buyer knows of no basis for any such suit,
investigation, legal action or proceeding. There are no outstanding orders,
rulings, decrees, judgments or stipulations by or with any court, administrative
agency, arbitration panel or other similar authority which challenge or
otherwise relate to the transactions contemplated by this Agreement.
ARTICLE 5
TRANSITION PROCESS
5.1 TRANSFER OF ASSETS. Concurrent with the execution of this
Agreement, the Seller has completed, executed confirmed the electronic transfer
of the URL via the Tucows OpensSRS system, administered through XxxXxxxxxx.xxx.
The Xxxxxxx.xxx URL, website code, database and website content will be
transferred to the Buyer immediately following execution of this Agreement.
5.2 PUBLIC ANNOUNCEMENTS. Neither Party shall make, or permit any of
its affiliates or representatives to make, any news release or other public
disclosure of this Agreement or the transactions contemplated hereby without the
prior approval of the other Party, which approval shall not be unreasonably
withheld.
ARTICLE 6
INDEMNIFICATION
6.1 INDEMNIFICATION BY THE SELLER. The Seller shall defend, indemnify
and hold the Buyer and its officers, directors, employees and agents harmless
from, against, and in respect of, any and all claims, demands, lawsuits,
proceedings, losses, obligations, assessments, fines, penalties, administrative
or judicial orders, costs, expenses, liabilities and damages, including without
limitation interest, penalties, and reasonable attorneys' fees and
disbursements, and costs of defense ("Losses") which arise or result from:
(a) any breach of or inaccuracy in any representations or
warranties of the Seller set forth in this Agreement, or any agreement,
certificate or other document delivered in connection with this Agreement;
(b) any failure by the Seller to perform in a timely manner
any covenant or agreement contained in this Agreement or any agreement,
certificate or other document delivered in connection with this Agreement;
(c) any Liabilities; and
(d) any claim by any finder, broker, financial agent or
similar person engaged by the Seller with respect to the transactions
contemplated by this Agreement.
6.2 INDEMNIFICATION BY THE BUYER. INDEMNIFICATION BY THE BUYER.
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The Buyer shall defend, indemnify and the Seller and his employees and
agents harmless from, against, and in respect of, any and all Losses which arise
or result from:
(a) any breach of or inaccuracy in any representations or
warranties of the Buyer set forth in this Agreement or any agreement,
certificate or other document delivered in connection with this Agreement;
(b) any failure by the Buyer to perform in a timely manner any
covenant or agreement contained in this Agreement or any agreement, certificate
or other document delivered in connection with this Agreement; and
(c) any claim by any finder, broker, financial agent or
similar person engaged by the Buyer with respect to any of the transactions
contemplated by this Agreement.
6.3 NOTIFICATION OF CLAIMS. If any party or parties (the "Indemnified
Party") reasonably believes that it is entitled to indemnification hereunder, or
otherwise receives notice of the assertion or commencement of any third-party
claim, action, or proceeding (a "Third-Party Claim"), with respect to which such
other party or parties (the"Indemnifying Party") is obligated to provide
indemnification pursuant to Section 6.1 or 6.2 above, the Indemnified Party
shall promptly give the Indemnifying Party written notice of such claim for
Indemnification (an "Indemnity Claim"). The delivery of such notice of Indemnity
Claim ("Claim Notice") shall be a condition precedent to any liability of the
Indemnifying Party for indemnification hereunder. The Indemnifying Party shall
have twenty (20) days from the receipt of a Claim Notice to notify the
Indemnified Party of whether or not the Indemnifying Party disputes its
liability to the Indemnified Party with respect to such Indemnity Claim
6.4 LIMITATIONS ON CLAIMS.
(a) The maximum aggregate liability of the Seller under
Section 6.1 above shall be limited to the amount of the Purchase Price. The
maximum aggregate liability of the Buyer under Section 6.2 above shall be
limited to the amount of the Purchase Price.
(b) The exclusive remedies of the Parties for any and all
claims arising from or related to this Agreement and the transactions
contemplated by this Agreement (whether in contract or otherwise) shall be to
assert a claim for indemnification pursuant to this Article 6.
(c) Neither Party shall be entitled to recover any special or
consequential damages.
(d) No Claim Notice may be delivered more than 60 days after
the Effective Date.
(e) The Buyer acknowledges that: (i) the Seller has made no
representations or warranties with respect to the Transferred Assets other than
those set forth in Article 3 above; (ii) the Buyer has conducted a due-diligence
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review of the Transferred Assets and is purchasing them "as is" and "where is"
and without any warranties of any kind (including, without limitation, any
warranty of merchantability or fitness for a particular purpose) except those
set forth in Article 3; and (iii) upon consummation of the sale of the
Transferred Assets to the Buyer, the Seller intends to cease operations and
utilize all of the proceeds of the sale to pay creditors.
ARTICLE 7
COVENANTS AFTER THE CLOSING
7.1 USE OF NAME. The Seller agrees that following the Closing Date, it
shall no longer use the name "Xxxxxxx.xxx" without the prior written consent of
the Buyer in each instance.
7.2 CONFIDENTIALITY. Each Party agrees that it will not, without the
prior written consent of the other Party, disclose publicly or to any third
party (other than each Party's professional advisors) the terms and conditions
of this Agreement or any confidential information obtained from the other in
connection with or in any way related to this Agreement or the transactions
contemplated hereby, except to the extent required by law or necessary in order
to establish rights under this Agreement.
ARTICLE 8
MISCELLANEOUS
8.1 ENTIRE AGREEMENT; WAIVERS. This Agreement comprises the entire
agreement between the Parties relating to its subject matter and supersedes all
prior agreements and understandings between them (including, without limitation,
the Letter of Intent) relating to such subject matter. Each Party may extend the
time for, or waive performance of, any of the obligations of the other, waive
any inaccuracies in the representations or warranties of the other, or waive
compliance by the other with any of the covenants or conditions contained in
this Agreement, but only by an instrument in writing signed by the Party
granting such extension or waiver.
8.2 ATTORNEYS FEES. If any legal action, arbitration, mediation or
other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default, or misrepresentation in connection with any
of the provisions of this Agreement, the successful or prevailing Party shall be
entitled to recover reasonable attorneys' fees and other costs incurred in that
action or proceeding, in addition to any other relief to which it or they may be
entitled.
8.3 EXPENSES. Each Party shall pay its own fees, expenses and
disbursements and those of its respective agents, representatives, consultants,
accountants and counsel incurred in connection with this Agreement and the
transactions contemplated hereby.
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8.4 GOVERNING LAW. This Agreement is made and shall be construed in
accordance with the laws of the State of California, without regard to conflict
of law principles.
8.5 NOTICES. Any notice to a Party given pursuant to this Agreement
shall be in writing addressed as follows:
If to the Seller: Xxxxxxx.xxx, Inc.
000 Xxxxxx Xx.
Xxx. 00
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000 or (000) 000-0000
Fax: (000) 000-0000
If to the Buyer: Internet Properties Development Corp
000 X Xxxxx Xxx 000, xxx x00
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
8.6 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of, and be binding upon and enforceable against, the respective successors and
assigns of the Parties but may not be assigned by either Party without the prior
written consent of the other Party.
8.7 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original for all purposes.
8.8 SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any person or circumstances shall to any extent be
invalid or unenforceable, the remainder of this Agreement or the application of
such terms or provisions to persons or circumstances other than those as to
which it is invalid or unenforceable, shall not be affected thereby and each
term and provision of this Agreement shall be valid and enforced to the fullest
extent permitted by law.
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IN WITNESS WHEREOF, the Parties have executed this Agreement
as of the Effective Date.
XXXXXXX.XXX, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxxxx
President
Internet Properties Development Corp.
By: /s/ Xxxx Xxxxx
--------------------------------
Xxxx Xxxxx
President
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