ims043005reno_ex99-1.txt
EXHIBIT 99.1
ASSET PURCHASE AGREEMENT
This agreement for the sale and purchase of assets is entered into as of the
26th day of April 2005 between International Monetary Systems, Ltd. (Buyer or
IMS), a Wisconsin corporation, and United Trade Network, Inc. (Seller or UTN),
a Nevada corporation.
For consideration of the mutual covenants contained herein and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereby agree as follows:
1. Sale of Client Barter Accounts. On the effective date, Seller shall
sell, transfer, assign and deliver to Buyer, free and clear of all
liens, claims, encumbrances and charges, its membership list and all
client barter accounts of the members of UTN Reno, NV office, as listed
on the UTN/Reno software printouts as of the effective date. Should any
account member decide not to enter into an IMS agreement, the prior UTN
contract will remain in force but will be serviced by and belong to IMS.
For purposes of this Agreement, a barter trade account is an account of
a member of UTN, that member having entered into a membership agreement
with UTN prior to the effective date. The UTN Las Vegas clients are not
included in this sale.
2. Sale of Other Business Assets. On the effective date, Seller shall sell,
convey, transfer assign and deliver to Buyer and Buyer will accept and
purchase certain of Seller's other business assets. These assets shall
include, but not be limited to, the following:
A. All furniture, fixtures and inventory currently being used in the
UTN office. (Exhibit A)
B. Accounts receivable as listed on the UTN software printout as of
the effective date. It is understood that any payments on these
accounts received by UTN after the effective date shall be
immediately remitted to IMS. (Exhibit B)
C. Any other assets agreed upon prior to the effective date.
D. It is understood that cash in UTN bank accounts is not included in
the assets being sold.
3. Consideration. In consideration of the transfer and delivery at closing
to Purchaser of the assets described in paragraphs 1 and 2, and upon
compliance with the covenants and agreements set forth herein, IMS shall:
A. Pay to Seller the amount of 155,000 payable as follows:
(i) At the closing, remit to Seller the sum of $50,000.00 in U. S.
currency. In addition, Buyer shall make five consecutive monthly
payments of $10,000.00 each, beginning on May 30, 2005. Buyer shall
also issue one hundred ten thousand (110,000) shares of the common
stock of International Monetary Systems, Ltd. to Seller or its
designee. The stock will be subject to a one-year lock-up and will
be restricted as required under SEC Rule 144. The stock is
currently traded on the over-the-counter bulletin board under the
symbol: INLM.
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(ii) Assume responsibility for the management of Seller's client
membership list and the trade account balances of the UTN accounts
transferred as of the effective date. "Seller's trade account
balance" is defined as the total amount of trade dollars (positive
or negative) the members have available to use in trade.
(iii) Assume and agree to pay the balance of Seller's lease for the
premises now being occupied as the UTN offices at 000 Xxxxx Xxxxxx,
Xxxx, XX.
4. Price Guarantee. IMS hereby guarantees a price of $.50 per share on
the 110,000 shares of IMS stock that are part of this agreement. To
secure this guarantee, Buyer agrees to the following:
A. Right to Redeem. Beginning May 1, 2006, if Seller is unable to sell
its Guaranteed Shares into the market at, or above, the guaranteed
price, Seller may require Buyer to buy back the 110,000 Guaranteed
Shares at the guaranteed price. If Seller exercises this right, Buyer
will pay to Seller $20,000 on May 1st, $20,000 on June 1st and
$15,000 on July 1st of 2006.
B. Release of Purchaser's Obligations - Market Conditions. If after one
year from the effective date, Buyer's stock is trading in the public
market above $.60 per share and average daily trading volume for the
Purchaser's stock for 20 consecutive trading days is greater than
30,000 shares, and if Seller is eligible to sell shares under SEC
Rule 144, Purchaser shall have the right to give notice to Seller of
such circumstance and to require that Seller elect either:
(i) to sell 40,000 of the Guaranteed Shares into the market on
May 10, 2006, 40,000 Shares on June 10th and 30,000 shares
on July 10, 2006.
(ii) to allow Buyer to redeem such 110,000 Guaranteed Shares at the
Guaranteed Price according to the terms in Section 4.A above, or
(iii) to retain such 110,000 Guaranteed Shares for investment, in
which case Buyer shall be relieved of its obligations under this
guarantee of stock value.
Seller shall notify Buyer of its election hereunder within ten days
following receipt of Buyer's notice. If Seller shall fail to give
such notice, Seller shall be deemed to have elected to retain the
110,000 Guaranteed Shares for investment pursuant to clause (iii)
above. The price guarantee will be considered as satisfied at such
time as Seller has received a total of $55,000 through any of the
options described in Section 4(B) or any combination thereof. In
such an event, all of Buyer's obligations will have been fulfilled.
5. Liabilities. IMS shall not be considered a successor corporation of UTN
and will not be responsible for any UTN liabilities not specifically
included in this Agreement.
6. Default. In the event of a default hereunder, Buyer shall pay all of
Seller's legal fees and other costs of collection.
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7. Non-compete Agreement. Seller agrees that for a period of 18 months
from the effective date of this agreement, Seller will not engage in
or otherwise affiliate with any barter or trade exchange located within
a 50 mile radius of any IMS office. This does not include the greater
Los Angeles, CA market in which both parties are operating. Seller also
agrees that Seller will not induce nor attempt to induce any of IMS's
clients to transfer their patronage relating to IMS's business from IMS
to any other business or company engaged in a similar business. Buyer
agrees that for a period of three years from the date of closing this
transaction, and as long as Xxxx Xxxxxx is operating a UTN office in
Las Vegas, NV, Buyer will not enter the Las Vegas market nor open an
office within fifty miles of the city.
8. Representations and Warranties of Seller.
A. Seller has the full right, power and authority to carry out this
Agreement in all respects and is not subject to any restriction or
agreement which prohibits or would be violated by consummation of the
transaction contemplated by this Agreement.
B. Seller, to its knowledge, has good and marketable title to the
purchased assets. All the purchased assets are free and clear of
restrictions on or conditions to transfer or assignment, and of liens,
pledges, charges, encumbrances, equities, claims, covenants,
conditions, or restrictions. All tangible personal property is in
good operating condition and repair, ordinary wear and tear excepted.
C. To the best of Seller's knowledge, and as of the date of this
Agreement, the information that has been furnished to Buyer by or on
behalf of Seller in connection with the transactions contemplated
hereby, taken together, does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements contained therein not materially misleading.
D. To Seller's knowledge, the Seller is not aware of any pending or
threatened suit, action, arbitration, or legal, administrative, or
other proceeding, or governmental investigation against or affecting
any of its assets. To its knowledge, Seller is not in default with
respect to any order, writ, injunction, or decree of any federal,
state, local, or foreign court, department, agency, or
instrumentality. Seller is not presently engaged in any legal action
to recover monies due to, or damages sustained by, Seller.
E. Except as otherwise set forth herein, to the best of Seller's
knowledge there is no fact, event, or condition which might
materially and adversely affect the financial condition of Seller's
business prior to the closing date. During the period between the
acceptance of this Agreement and closing, Seller will continue to
operate its barter exchange in substantially the same manner as it
has in the past.
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9. Representations and Warranties of Buyer.
A. Buyer has the full right, power, and legal capacity to enter into
the Agreement and to consummate the transaction contemplated hereby.
This Agreement is valid and binding upon Buyer in accordance with
its terms.
B. Neither the execution and delivery of this Agreement nor performance
of this Agreement by Buyer will conflict with or result in the breach
of any contract or agreement to which Buyer is a party or by which
Buyer is bound.
10. Notice. All payments and communications which may be or are required to
be given by either party shall, in the absence of a specific provision
to the contrary, be in writing and delivered or sent by facsimile to the
parties at their following respective addresses and shall be deemed to
have been received at the time of delivery or facsimile transmission.
Either party may from time to time change its address by providing
written notice to the other party.
For the Seller: United Trade Network, Inc
Attn: Xxxxxxx Xxxxxx, President
0000 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
For the Buyer: International Monetary Systems, Ltd.
Attn: Xxxxxx X. Xxxxxx, President
00000 X. Xxxxxxxx Xx
Xxx Xxxxxx, XX 00000
Facsimile: (000) 000-0000
11. Headings. The headings in this Agreement are for reference purposes
only and shall not be deemed a part of this Agreement.
12. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
13. Benefit. This Agreement shall be binding upon and inure to the benefit of
the parties hereto, their legal representatives, successors, and assigns.
14. Governing Law; Submission to Jurisdiction. This agreement shall be
construed in accordance with the laws of the State of Wisconsin. Venue
for any disputes arising from this Agreement shall be placed exclusively
with the courts of the State of Wisconsin. Purchaser and Seller hereby
irrevocably submit to the jurisdiction of any state or Federal court
located in the State of Wisconsin and agree that process may be served
upon them by any means resulting in actual notice to them.
15. Closing. The closing shall take place on the date of this Agreement but
shall become effective as of April 30, 2005. Closing shall be held at
the UTN trade exchange offices located at 000 Xxxxx Xxxxxx, Xxxx, XX at
10:00 a.m. on that date, or at such other time and place as the parties
may agree upon in writing. The closing may also be executed by fax
transmission, with original copies to follow.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above.
INTERNATIONAL MONETARY SYSTEMS, LTD. UNITED TRADE NETWORK, INC.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxxx
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Xxxxxx X. Xxxxxx, President Xxxxxxx Xxxxxx, President
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