ASSET PURCHASE AGREEMENT
This
ASSET PURCHASE AGREEMENT
(the "Agreement") dated as of the 19th day of
January, 2009 is entered into by and between China America Holdings, Inc., a Florida corporation (f/k/a
Sense Holdings, Inc.) (“Seller”) and Pearl Group Advisors, Inc., a Florida
corporation ("Buyer").
RECITALS
WHEREAS, the Seller has
historically conducted business activities in it biometrics division (the
“Biometrics Operations”), including through its two wholly-owned subsidiaries
Sense Technologies, Inc., a Florida corporation ("Sense Technologies") and Micro
Sensor Technologies, Inc., a Florida corporation ("Micro Sensor").
WHEREAS, prior to its
acquisition in June 2007 of a majority interest in Shanghai AoHong Industry Co.,
Ltd., a Chinese limited liability company ("AoHong"), the Biometrics Operations
represented all of the Corporation's operations.
WHEREAS, subsequent to the
acquisition of a controlling interest in AoHong, the business and operations of
AoHong have represented substantially all of the Corporation's
operations.
WHEREAS, the Corporation has
determined to exit all business activities related to the Biometrics Operations
and to terminate the employment of its Chief Executive Officer, Xxxx Xxxxx
Perler.
WHEREAS, Xx. Xxxxxx is the
sole shareholder of the Buyer and was a member of its Board of
Directors.
WHEREAS, Xx. Xxxxxx is
desirous of acquiring all rights, title and interest in the Biometrics
Operations and terminating his employment with the Corporation.
WHEREAS, Seller desires to
convey, sell and assign to Buyer all of Seller’s right, title and interest in
and to the Biometrics Operations, upon the terms and conditions contained in
this Agreement.
NOW THEREFORE, in
consideration of the mutual promises and other good and valuable consideration,
the sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. Recitals. The
foregoing recitals are true and correct.
2. Sale and Purchase of
Assets.
2.1 Sale and Purchase of
Assets. Subject to the terms and conditions of this Agreement,
at the Closing described in Section 6, Seller shall sell to Buyer, and Buyer
shall purchase from Seller any and all assets related to the Biometrics
Operations including, but not limited to the following (collectively, the
“Assets):
(a) All
of the Seller’s accounts receivable relating to its Biometric Business as set
forth in Schedule 2.1(a) (the “Accounts Receivables”);
(b) All
of the Seller’s rights, title and interest in and to any agreements related to
the Intangible Assets as hereinafter defined, including but not
limited to, all existing agreements, if any, with contract manufacturers,
resellers and suppliers (the “Agreements”);
(c) All
customer and supplier lists, copies of financial and accounting records, credit
and accounts receivable (as hereinafter defined) records, correspondence and
other similar documents and records used and/or useful in connection with the
Assets including the customer list included on Schedule 2.1(c) (collectively,
the “Records”);
(d) All
of Seller’s rights, title and interest, if any, in all patent registrations and
applications (including design patents registrations and applications),
trademarks, trademark registrations and applications, service marks, service
xxxx registrations and applications, copyrights, copyright registrations and
applications, trade dress, trade names (whether or not registered or by whatever
name or designation), owned, applied for, or registered in the name of, the
Seller related to the Biometric Business which includes all intellectual
property including common law rights associated with the trademarks Check
Print®, BioClock®, Sense®, meCard®, "Security Solutions at a Touch of a
Finger"®, Explosive Sensing Protocol™ and Sense-It™; ), the tradename “Sense
Technologies”; all proprietary data, processes, source code and copyright
applications for such source code, technical or manufacturing know-how or
information, owned by or used by (to the extent of Seller’s interest) the Seller
in connection with the Biometric Business; all rights related to the Internet
domain name xxx.xxxxxxx.xxx and
all content included on such website including logos; the property and
technology listed on Schedule 2.1(d) and all goodwill relating to the Biometric
Business (collectively, the “Intangible Assets”); and
(e) All
proceeds, rights, claims, credits, causes of action or rights of set-off against
third parties relating to the Assets, including, without limitation,
unliquidated rights under manufacturers’ and vendors’ warranties (the
“Claims”).
2.2 Liabilities Assumed.
At the Closing, the Buyer shall assume and undertake to perform, pay, satisfy or
discharge in accordance with their terms, any debt, loss, damage, adverse claim,
liability or obligation (whether direct or indirect, known or unknown, asserted
or unasserted, absolute or contingent, accrued or unaccrued, liquidated or
unliquidated, or due or to become due, and whether in contract, tort, strict
liability or otherwise) (“Liabilities”), including any liability for taxes of
Seller, Sense Technologies and Micro Sensor, relating to or otherwise in respect
of the Biometric Business or its operation on, before or after the Closing Date
(the “Assumed Liabilities”). Assumed Liabilities shall also include
the following Liabilities:
(a) all
Liabilities in respect of any and all products or services sold by Seller or any
of its Affiliates relating to the Biometric Business on or before the Closing
Date, including such liabilities for refunds, adjustments, allowances,
exchanges, returns, warranty, merchantability, claims for breach of contract or
in tort and other claims related to Seller’s Biometric Business;
(b) all
Liabilities arising under or pursuant to any environmental laws, to the extent
arising out of or otherwise related to Seller’s ownership or operation of the
Biometrics Business;
(c) all
Liabilities arising out of, under or in connection with the Agreements including
a breach by or default of Seller accruing under such Agreements on,
prior to or after the Closing; and
(d) all
Liabilities in respect of any lawsuit, action or proceeding, pending or
threatened, or any claim arising out of, relating to or otherwise in respect of
the Assets or the Biometric Business that is asserted or brought by any person
(including any governmental authority), based on any actual or alleged civil or
criminal violation of law.
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2.3 Purchase
Price. Buyer’s agreement set forth herein and the agreement of
Xxxx Xxxxx Perler to enter into the Perler Separation Agreement as hereinafter
defined shall constitute the purchase price for the sale of the
Assets.
3. Representations and
Warranties of Seller.
3.1 Organization and Good
Standing. Seller is a corporation duly incorporated, validly
existing and in good standing under the laws of its jurisdiction of formation,
with full corporate power and authority to own, lease and operate its business
and properties and to carry on business in the places and in the manner as
presently conducted or proposed to be conducted. Seller is in good
standing as a foreign corporation in each jurisdiction in which the properties
owned, leased or operated, or the business conducted, by it requires such
qualification except where the failure to so qualify would not have a material
adverse effect on the Assets or consummation of the transactions contemplated
hereby.
3.2 Authority and
Enforcement. Seller has all requisite corporate power and
authority to execute and deliver this Agreement, and to consummate the
transactions contemplated hereby. Seller has taken all corporate
action necessary for the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, and this Agreement
constitutes the valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms, except as may be affected by bankruptcy,
insolvency, moratoria or other similar laws affecting the enforcement of
creditors’ rights generally and subject to the qualification that the
availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefor may be brought.
4. Representations and
Warranties of Buyer.
4.1 Organization and Good
Standing. Buyer is a corporation duly incorporated, validly existing and
in good standing under the laws of its jurisdiction of formation, with full
corporate power and authority to own, lease and operate its business and
properties and to carry on business in the places and in the manner as presently
conducted or proposed to be conducted. Buyer is in good standing as a
foreign corporation in each jurisdiction in which the properties owned, leased
or operated, or the business conducted, by it requires such qualification except
where the failure to so qualify would not have a material adverse effect on the
consummation of the transactions contemplated hereby.
4.2 Authority and
Enforcement. Buyer has all requisite corporate power and
authority to execute and deliver this Agreement, and to consummate the
transactions contemplated hereby. Buyer has taken all corporate
action necessary for the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, and this Agreement
constitutes the valid and binding obligation of Buyer, enforceable against Buyer
in accordance with its terms, except as may be affected by bankruptcy,
insolvency, moratoria or other similar laws affecting the enforcement of
creditors’ rights generally and subject to the qualification that the
availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefor may be brought.
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4.3 Information on the Company
and the Biometrics Business. Dore Perler, the president of the
Buyer has been the Chief Executive Officer of the Seller since July 1998 and has
been operating the Biometrics Business since the Company launched such business
in July 1998. In addition, Xx. Xxxxxx has had access to such other
information concerning the Biometrics Business’ operations, financial condition
and other matters as the Buyer deemed necessary to enable Buyer to thoroughly
investigate the Assets and all aspects of the transaction set forth in this
Agreement. Buyer has determined that the Assets are satisfactory to
Buyer in all respects and is purchasing the Assets in "as is"
condition. Buyer has and will rely solely on Buyer's own independent
investigations and inspections and Buyer has not relied and will not rely on any
representation of Seller other than as expressly set forth in this
Agreement. Buyer further acknowledges and agrees that, except for the
specific representations made by Seller in this Agreement, Seller has made no
representations, is not willing to make any representations, nor held out any
inducements to Buyer, other than those (if any) exclusively set forth in this
Agreement; and Seller is not and shall not be liable or bound in any manner by
any express or implied warranties, guaranties, statements, representations or
information pertaining to the Assets, except as may be specifically set forth in
this Agreement.
5. Conditions to
Closing.
5.1 Conditions Precedent to
Buyer’s Obligation to Close. The obligation of Buyer to
consummate the transactions contemplated by this Agreement is subject to
satisfaction of the following conditions on or prior to the Closing
Date:
(a) The
representations and warranties of Seller set forth in Section 3 above shall be
true and correct in all material respects at and as of the Closing
Date.
(b) No
action, suit, or proceeding shall be pending or threatened before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (i) prevent or adversely affect
Buyer’s consummation of any of the transactions contemplated by this Agreement
or (ii) cause any of the transactions contemplated by this Agreement to be
rescinded following consummation (and no such injunction, judgment, order,
decree, ruling, or charge shall be in effect).
(c) No
material adverse change shall have taken place with respect to the Assets;
and
(d) All
actions to be taken by Seller in connection with consummation of the
transactions contemplated hereby and all certificates, instruments, and other
documents required to effect the transactions contemplated hereby will be
reasonably satisfactory in form and substance to the Buyer.
5.2 Conditions Precedent to
Seller’s Obligation to Close. The obligation of Seller to
consummate the transactions contemplated hereby is subject to satisfaction of
the following conditions on or prior to the Closing Date:
(a) The
representations and warranties of Buyer set forth in Section 4 above shall be
true and correct in all material respects at and as of the Closing
Date.
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(b) No
action, suit, or proceeding shall be pending or threatened before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (i) prevent or adversely affect
Buyer’s consummation of any of the transactions contemplated by this Agreement
or (ii) cause any of the transactions contemplated by this Agreement to be
rescinded following consummation (and no such injunction, judgment, order,
decree, ruling, or charge shall be in effect);
(c) Seller
shall have obtained from Xxxx Xxxxx Perler a termination agreement related to
Xx. Xxxxxx’x employment with Seller in form and substance satisfactory to Seller
(the “Perler Termination Agreement”);
(d) Seller
shall have obtained from Xxxx Xxxxx Perler a Separation Agreement With Waiver of
Claims related to Xx. Xxxxxx’x employment with Seller in form and substance
satisfactory to Seller (the “Perler Separation Agreement”);
(e) Seller
shall have obtained the approval of its Board of Directors; and
(f) All
actions to be taken by Buyer in connection with consummation of the transactions
contemplated hereby and all certificates, instruments, and other documents
required to effect the transactions contemplated hereby will be reasonably
satisfactory in form and substance to Seller.
6. Closing; Closing
Date.
6.1 A
closing of the transactions contemplated hereby (the “Closing”) will take place
at such time and place as mutually agreed upon by Seller and
Buyer. The date on which the Closing is held is referred to in this
Agreement as the “Closing Date.”
6.2 Documents to be Delivered at
the Closing. At the Closing, Seller shall deliver, or cause to
be delivered, to Buyer the following a duly executed xxxx of sale, dated the
Closing Date, transferring to Buyer all of Seller's right, title and interest in
and to the Assets together with possession of the Assets together with such
other certificates, documents and instruments as Buyer may have reasonably
requested in connection with the transaction contemplated hereby. At the
Closing, Xx. Xxxxxx shall deliver, or cause to be delivered to Seller, the
Perler Termination Agreement.
7. Obligations
Post-Closing. If, at any time after the Closing, the parties
shall consider or be advised that any further deeds, assignments or assurances
in law or that any other things are necessary, desirable or proper to complete
the transactions contemplated hereby in accordance with the terms of this
Agreement or to vest, perfect or confirm, of record or otherwise, the title to
any of the Assets, the parties agree that their proper officers and directors
shall execute and deliver all such proper deeds, assignments and assurances in
law and do all things necessary, desirable or proper to vest, perfect or confirm
title to such Assets and otherwise to carry out the purpose of this Agreement,
and that the proper officers and directors the parties are fully authorized to
take any and all such actions.
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8. Indemnity by the
Buyer. The Buyer agrees that it will indemnify and hold the
Seller and their respective officers, directors, employees and agents
(collectively, the “Seller Indemnitees”) harmless from all Liabilities incurred
or suffered by the Seller. For this purpose, “Liabilities” incurred
by the Seller means all suits, proceedings, claims, expenses, losses, costs,
liabilities, judgments, deficiencies, assessments, actions, investigations,
penalties, fines, settlements, interest and damages (including reasonable
attorneys' fees and expenses), whether suit is instituted or not and, if
instituted, whether at any trial or appellate level, and whether raised by the
parties hereto or a third party, incurred or suffered by the Seller, arising
from, in connection with or as a result of (a) any default or breach in the
performance of any of the covenants or agreements made by the Buyer in this
Agreement; or (b) the operation of the Assets after the Closing by the
Buyer.
9. Miscellaneous.
9.1 Expenses. Buyer
and Seller shall bear their own respective expenses incurred in connection with
this Agreement and in connection with all obligations required to be performed
by each of them under this Agreement.
9.2 Entire Agreement; No
Waiver. This Agreement and any instruments and agreements to
be executed pursuant to this Agreement, sets forth the entire understanding of
the parties hereto with respect to its subject matter, merges and supersedes all
prior and contemporaneous understandings with respect to its subject matter and
may not be waived or modified, in whole or in part, except by a writing signed
by each of the parties hereto. No waiver of any provision of this
Agreement in any instance shall be deemed to be a waiver of the same or any
other provision in any other instance. Failure of any party to
enforce any provision of this Agreement shall not be construed as a waiver of
its rights under such provision.
9.3. Construction and
Enforcement. This Agreement shall be construed in accordance
with the laws of the State of Florida, without and application of the principles
of conflicts of laws. If it becomes necessary for any party to
institute legal action to enforce the terms and conditions of this Agreement,
and such legal action results in a final judgment in favor of such party
("Prevailing Party"), then the party or parties against whom said final judgment
is obtained shall reimburse the Prevailing Party for all direct, indirect or
incidental expenses incurred, including, but not limited to, all attorney's
fees, court costs and other expenses incurred throughout all negotiations,
trials or appeals undertaken in order to enforce the Prevailing Party's rights
hereunder. Any suit, action or proceeding with respect to this
Agreement shall be brought in the state or federal courts located in Broward
County in the State of Florida. The parties hereto hereby accept the
exclusive jurisdiction and venue of those courts for the purpose of any such
suit, action or proceeding. The parties hereto hereby irrevocably
waive, to the fullest extent permitted by law, any objection that any of them
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any judgment entered
by any court in respect thereof brought in Broward County, County Florida, and
hereby further irrevocably waive any claim that any suit, action or proceeding
brought in Broward County, Florida, has been brought in an inconvenient
forum.
9.4 Notices. All
notices and other communications under this Agreement shall be in writing and
shall be deemed given when delivered personally (including by confirmed legible
telecopier transmission) or mailed by certified mail, return receipt requested,
or by overnight mail properly receipted to the parties at the following
addresses (or to such address as a party may have specified by notice given to
the other party pursuant to this provision):
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If to
Seller: 00000
X.X. 00xx Xxxxxx, Xxxxx 0
Xxxxxxx,
XX 00000
Attention: Xx.
Xxxxx Xx, Chief Executive Officer
Telephone
No.:(000) 000-0000
Telecopy
No.: (000) 000-0000
with a
copy
to: Xxxxx
X. Xxxxxxxxx, Esq.
Xxxxxxxxx Xxxxxxxxxx & Beilly
LLP
0000 Xxxxxxxxx Xxxxxxxxx,
X.X.
Xxxxx 000
Xxxx Xxxxx,
Xxxxxxx 00000
Telephone No. (000)
000-0000
Telecopy No. (000)
000-0000
If to
Buyer: 0000
XX 00 Xxxxx
Xxxxxx Xxxx,
Xxxxxxx 00000
Attention: Xx.
Xxxx Xxxxx Xxxxxx, President
Telephone
No.: (___) ___-____
Telecopy
No.: (___) ___-____
9.5 Separability. In
the event that any provision hereof would, under applicable law, be invalid or
enforceable in any respect, such provision shall be construed by modifying or
limiting it so as to be valid and enforceable to the maximum extent compatible
with, and permissible under, applicable law. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement which shall
remain in full force and effect.
9.6 Binding Effect;
Assignment. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns. Nothing in this Agreement shall create or be deemed to
create any third party beneficiary rights in any person or entity not a party to
this Agreement. No assignment of this Agreement or of any rights or
obligation hereunder may be made by either party (by operation of law or
otherwise) without the prior written consent of the other and any attempted
assignment without the required consent shall be void; provided, however, that
no such consent shall be required of Buyer to assign part or all of its rights
under this Agreement to one or more of its subsidiaries or
affiliates.
9.7 Counterparts. This
Agreement may be executed in counterparts, each of which shall be an original,
but which together shall constitute one and the same Agreement.
9.8. Role of
Counsel. Xx. Xxxxxx acknowledges his understanding that this
Agreement was prepared at the request of the Corporation by Xxxxxxxxx Xxxxxxxxxx
& Beilly, LLP, its counsel, and Xxxxxxx Xxxxxxxxx, Esq. and that such
attorneys did not represent Xx. Xxxxxx or the Buyer in conjunction with this
Agreement or any of the related transactions. Xx. Xxxxxx, as further
evidenced by his signature below, acknowledges that he has had the opportunity
to obtain the advice of independent counsel of his choosing prior to his
execution of this Agreement and that he has availed himself of this opportunity
to the extent he deemed necessary and advisable. By his signature
below, Xx. Xxxxxx represents and warrants that he fully understands the terms
and provisions of this Agreement.
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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
By: _/s/ Shaoyin
Wang_______________________
Shaoyin
Wang, Chief Executive Officer
PEARL GROUP ADVISORS,
INC.
By: _/s/ Xxxx Xxxxx
Perler_____________________
Xxxx Xxxxx Perler,
President
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SCHEDULES
Schedule
2.1(a) - Accounts Receivables
Schedule
2.1(c) – Customer List
Schedule
2.1(d) - Intangible Assets
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