Exhibit 99.1
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement") is entered into this 15th day
of June 2001, by and between Wireless Ventures Inc., a Delaware corporation (the
"Purchaser") and IRMG Inc., an Ontario corporation (the "Seller"). Purchaser and
the Seller are sometimes individually referred to herein as a "Party" and
together as the "Parties."
WHEREAS, the Seller is the beneficial owner of the assets, (any and all assets,
interests, contracts, copyrights, codes, titles, licenses, proprietary rights,
trademarks, intellectual property assets, equipment, and internet related
assets), known as "4Cash ATM Services", a division of the Seller (the "Assets");
WHEREAS, Purchaser desires to purchase from the Seller, and the Seller
desires to sell to Purchaser, the Assets;
WHEREAS, the Parties desire to set forth their mutual agreements and
understandings with respect to the purchase and sale of the Assets;
NOW, THEREFORE, the Parties, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
Section 1.1. Agreement to Sell and Purchase Assets. Upon the terms of this
Agreement, the Seller sells and agrees to deliver to Purchaser, free of all
liens, pledges, mortgages, security interests, charges, restrictions, adverse
claims or other encumbrances of any kind or nature whatsoever, and Purchaser
purchases and accepts from the Seller all the Assets. Purchaser and the Seller
agree that the purchase price for all the Assets will be: (i) 10,000,000 (ten
million) previously unissued but authorized shares of the Purchaser's Common
Stock, (the "Purchase Shares"); (ii) warrants to purchase 5,000,000 (five
million) shares of Purchaser's Common Stock, at an exercise price of US $0.10
for a period of three (3) years from the Closing Date, vesting once the
Purchaser has cumulative reported net profits from the date of Closing (the
"Purchase Warrants"); (iii) 10,000,000 (ten million) previously unissued but
authorized shares of the Purchaser's Common Stock issued upon the achievement of
US $1,000,000 cumulative net profit before taxes, provided the achievement is
within 2 years of the Closing Date (the "Performance Shares"); (iv) warrants to
purchase 1,100,000 (one million, one hundred thousand) shares of Purchaser
Common Stock, at an exercise price of US $0.10 per share, for a term of five (5)
years from the Closing Date fully vested to Xx. Xxxxxxx X. Cussons, his assign
or his designee (the "Cussons Warrants).
Section 1.2. Services Contract. The Purchaser shall enter into a three (3) year
Management Services Contract (the "Services Contract") with the Seller,
automatically renewable for a term of two years, which includes a royalty of 10%
of the Purchaser's cumulative earnings before taxes depreciation and interest
("EBITDA") after Closing Date, paid by the Purchaser to the Seller, or its
assignee or designee, quarterly in arrears (the "Royalty"). (See Exhibit A, the
Services Contract).
Section 1.3. The Closing. The consummation of the transactions contemplated by
Section 1.1 (the "Closing") shall take place at 10:00 A.M., local time, on June
15, 2001 at the offices of Seller, 000 Xxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxx Xxxxxx, or such other time and place as the Parties may agree upon (such
date, the "Closing Date").
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby represents and warrants to Purchaser as follows:
Section 2.1. Organization; Power and Authority. The Seller is duly organized and
validly existing as a corporation under the laws of the Province of Ontario and
is duly qualified to do business in each jurisdiction where the conduct of its
business or the ownership of its properties would require such qualification.
The Seller has all the requisite corporate and legal power and authority to
enter into this Agreement and perform its obligations hereunder. This Agreement
is being duly executed and delivered by Seller and constitutes the legal, valid
and binding obligation of the Seller enforceable against it, in accordance with
its terms, subject to bankruptcy, insolvency and other similar laws relating to
or affecting the enforceability of creditors' rights generally, and to general
principles of equity.
Section 2.2. Authorization and Ownership of Assets. The Seller represents that
it has good and valid title to the Assets, free and clear of any liens, pledges,
mortgages, security interests, charges, restrictions, adverse claims or other
encumbrances of any kind or nature whatsoever (collectively, "Liens") and at the
Closing the Seller shall deliver good and valid title to the Assets free and
clear of any Liens. Upon payment thereof pursuant to this Agreement, Purchaser
will have good and valid title to the Assets, free and clear of any Liens.
Section 2.3. Disclosure. Neither this Agreement nor any other document or
certificate delivered by or on behalf of the Seller in connection with the
Closing of the transactions contemplated herein contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein, viewed as a whole, in light of the
circumstances under which they were made, not misleading. There is no fact which
materially adversely affects the business, assets, properties, operations,
prospects, condition (financial or otherwise), results of operations or
liabilities of the Assets, taken as a whole, which has not been set forth in
this Agreement.
Section 2.4. No Conflicts; Consents. The execution, delivery and performance of
this Agreement by the Seller, and the consummation by the Seller of the
transactions contemplated by this Agreement will not (i) conflict with or
violate the organizational documents of the Company, or (ii) conflict with,
violate, result in the breach of any term of, constitute a default under, or
require the consent of or any notice to or filing with any third party or
governmental authority under, any Contract to which the Seller is a party or any
law, order, rule, regulation, decree, writ or injunction of any governmental
body having jurisdiction over the Seller or their respective properties, except
for such consents or filings as have been obtained or made.
Section 2.5. Proceedings. There are no actions, arbitrations, audits, hearings,
investigations, litigations, or suits (whether civil, criminal, administrative,
investigative, or informal) (collectively, "Proceedings") pending or threatened
against the Seller that could have a material adverse effect on the Seller, or
the Assets, or that challenge, or may have the effect of preventing, delaying or
making illegal, or otherwise interfering with, any of the transactions
contemplated by this Agreement, and to the knowledge of the Seller no event or
circumstance exists that may give rise to or serve as a basis for the
commencement of any such Proceeding.
Section 2.6. Compliance with Laws. The Seller is in compliance with all laws,
treaties, rules, regulations, rights, privileges, qualifications, licenses and
franchises and determinations of any arbitrator or a court or other governmental
authority (collectively, "Laws"), other than Environmental Laws (as hereinafter
defined), in each case applicable or binding upon the Seller or any of its
property or to which the Seller or any of its property is subject or pertaining
to any or all of the transactions contemplated or referred to herein. The Seller
and the Assets has all licenses, permits, orders or approvals of any
governmental authority that are necessary to the conduct of its business.
Section 2.7. Securities Laws. Seller acknowledges that (i) the Purchase Shares,
the Performance Shares and the underlying shares of the Purchase Warrants and
the Cussons Warrants have not been
registered under the Securities Act, or any state securities laws, and cannot be
sold or otherwise disposed of unless such Purchase Shares and Purchase Warrants
are registered under the Securities Act and any applicable state securities
laws, or are exempt from such registration, and (ii) the certificates
representing the Purchase Shares, the Purchase Warrants, the Performance Shares
and the Cussons Warrants will contain the restrictive legends inscribed on said
certificates.
Section 2.8. No Material Adverse Change; Ordinary Course of Business. Since May
15, 2001, there has not been any material adverse change in the assets (Assets),
business, properties, operations or financial condition of the Seller, nor has
the Seller participated in any transaction or acted outside the ordinary course
of business.
Section 2.9. Taxes. (i) "Taxes" shall mean all taxes, charges, fees, liens,
customs, duties or other assessments, however denominated, including any
interest, penalties, additions to tax or additional taxes that may become
payable in respect thereof, imposed by the United States or Canadian government,
any state or province, local or foreign government, or any agency or political
subdivision of any such government (a "Tax Authority"), which taxes shall
include, without limiting the generality of the foregoing, all income taxes,
payroll and employee withholding taxes, unemployment insurance, social security,
sales and use taxes, excise taxes, capital taxes, franchise taxes, gross receipt
taxes, occupation taxes, real and personal property taxes, value added taxes,
stamp taxes, transfer taxes, workers' compensation taxes, taxes relating to
benefit plans and other obligations of the same or similar nature.
(ii) There are no liens for Taxes (other than for current Taxes not yet due and
payable) upon the assets of the Seller. The Seller shall be responsible for all
past due taxes and penalties, fees or surcharges, not otherwise mentioned
herein, and all current taxes not yet due and payable upon the assets of the
Seller.
Section 2.10. Environmental Matters. The Seller is and has been in compliance in
all material respects with all applicable Environmental Laws (as hereinafter
defined). There is no civil, criminal or administrative judgment, action, suit,
demand, claim, hearing, notice of violation, investigation, proceeding, notice
or demand letter pending or threatened against the Seller pursuant to
Environmental Laws which could have a material adverse effect on the Seller; and
there are no past or present events, conditions, circumstances, activities,
practices, incidents, agreements, actions or plans which may prevent compliance
with, or which have given rise to or will give rise to liability under,
Environmental Laws that could have a material adverse effect on the Seller. As
used herein, "Environmental Laws" means federal, state and local laws,
principles of common law, regulations and codes, as well as orders, decrees,
judgments or injunctions issued, promulgated, approved or entered thereunder
relating to pollution, protection of the environment or public health and
safety.
Section 2.11. Intellectual Property. The Seller is the sole legal and beneficial
owner, free and clear of any Lien, of the entire right, title and interest in
and to the Intellectual Property Assets (as hereinafter defined) used in the
conduct of its business as presently conducted and as it is expected to be
conducted after the date of this Agreement and such rights to use, sell or
license are sufficient for such conduct of its business. The execution, delivery
and performance of this Agreement and the consummation of the transaction
contemplated hereby will not constitute a breach of any instrument or agreement
involving the Sellers Intellectual Property Assets, will not cause the
forfeiture or termination or give rise to a right of forfeiture or termination
of any of the Sellers Intellectual Property Asset or impair the rights of the
Purchaser or an affiliate of the Purchaser to use, sell or license any
Intellectual Property Asset of the Seller or portion thereof. As used herein,
"Intellectual Property Assets" means all worldwide industrial and intellectual
property rights, including, without limitation, patents, patent applications,
patent rights, trademarks, trademark applications, trademark rights, service
marks, service xxxx applications, service xxxx rights, copyrights, copyright
applications, trade names, unfair competition rights, franchises, licenses,
grants of rights, licenses or franchises or the like by governmental or
regulatory agencies, inventories, know-how, trade secrets, moral rights, rights
of publicity, customer lists, proprietary information, technologies, processes
and formulae, all source and object code, algorithm, architecture, structure,
display screens, layouts, inventions, development tools, domain names, URL's,
logos, watermarks, computer databases and all internet related assets, and all
documentation and media constituting, describing or
relating to the above, including, without limitation, manuals, memoranda and
records in any format, whether hard copy or machine-readable only.
Section 2.12. Real Property. The Seller does not own any real property
or hold any leasehold or other interests in any real property.
Section 2.13. Title to Properties; Liens. The Seller has sufficient title to the
Assets, properties and assets (whether real, personal, or mixed, and whether
tangible or intangible) that it owns or purports to own.
Section 2.14. Conduct of Business; Use of Name. The business carried on
by the Seller has been conducted directly by the Seller, and not through any
affiliate or through any other person or entity.
Section 2.15. Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable by the Seller
in connection with the transactions contemplated hereby.
Section 2.16. ERISA, Employees and Insurance. The Assets maintains no (i)
employees, (ii) insurance of any type; (iii) "employee benefit plans," within
the meaning of Section 3(3) of Employee Retirement Income Security Act of 1974
or any successor law, and regulations and rules issued pursuant thereto, (iv)
bonus, stock option, stock purchase, stock appreciation right, incentive,
deferred compensation, supplemental retirement, severance, and fringe benefit
plans, programs, policies or arrangements, or (v) employment or consulting
agreements, for the benefit of, or relating to, any current or former employee
(or any beneficiary thereof) of the Asset.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser severally hereby represents and warrant to Seller as follows:
Section 3.1. Access to Information. The Purchaser has received or has
had full access to all information they consider necessary or appropriate to
make an informed decision with respect to the acquisition of the Assets.
Section 3.2. Organization; Power and Authority. Purchaser is duly organized and
validly existing as a corporation under the laws of the State of Delaware and
has all requisite corporate power and authority to enter into this Agreement and
perform its obligations hereunder. This Agreement is being duly executed and
delivered by the Purchaser and constitutes the legal, valid and binding
obligation of the Purchaser enforceable against it in accordance with its terms,
subject to bankruptcy, insolvency and other similar laws relating to or
affecting the enforceability of creditors' rights generally, and to general
principles of equity.
Section 3.3. Disclosure. Neither this Agreement nor any other document or
certificate delivered by or on behalf of Purchaser in connection with the
Closing of the transactions contemplated herein contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein, viewed as a whole, in light of the
circumstances under which they were made, not misleading.
Section 3.4. No Conflicts; Consents. The execution, delivery and performance of
this Agreement by Purchaser, and the consummation by Purchaser of the
transactions contemplated by this Agreement will not (i) conflict with or
violate the organizational documents of Purchaser, or (ii) conflict with,
violate, result in the breach of any term of, constitute a default under, or
require the consent of or any notice to or filing with any third party or
governmental authority under, any Contract to which Purchaser is a party or any
law, order, rule, regulation, decree, writ or injunction of any governmental
body having jurisdiction over Purchaser or its properties, except for such
consents or filings as have been obtained or made.
Section 3.5. Securities Laws. Purchaser acknowledges that (i) the Purchase
Shares, the Performance Shares and the underlying shares of the Purchase
Warrants and the Cussons Warrants have not been
registered under the Securities Act, or any state securities laws, and cannot be
sold or otherwise disposed of unless such Purchase Shares and Purchase Warrants
are registered under the Securities Act and any applicable state securities
laws, or are exempt from such registration, and (ii) the certificates
representing the Purchase Shares, the Purchase Warrants, the Performance Shares
and the Cussons Warrants will contain the restrictive legends inscribed on said
certificates.
Section 3.6. Filings With the SEC. (a) Purchaser has filed with the Securities
and Exchange Commission (the "SEC") all reports, proxy statements, forms, and
other documents that has been required by law to file with the SEC
(collectively, the "Purchaser SEC Documents"). As of the date they were each
filed, giving effect to any amendments, (1) the Purchaser SEC Documents complied
in all material respects with the requirements of the Securities Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as applicable,
in effect on the date of filing and (2) the Purchaser SEC Documents do not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
(b) Each of Purchaser's financial statements (including the related
notes) included in the Purchaser SEC Documents have been prepared in accordance
with GAAP consistently applied with past practice and on that basis present
fairly, in all material respects, the financial position and the results of
operations, changes in stockholders' equity, and cash flows of Purchaser as of
the respective dates of and for the periods referred to in these financial
statements.
Section 3.7. Proceedings. There are no Proceedings pending or, to the knowledge
of Purchaser, threatened against Purchaser that could have a material adverse
effect on Purchaser or that challenge, or may have the effect of preventing,
delaying or making illegal, or otherwise interfering with, any of the
transactions contemplated by this Agreement, and to the knowledge of Purchaser
no event or circumstance exists that may give rise to or serve as a basis for
the commencement of any such Proceeding.
Section 3.8. Broker's, Finder's or Similar Fees. There are no brokerage
commissions, finder's fees or similar fees or commissions payable by
Purchaser in connection with the transactions contemplated hereby.
ARTICLE V
CONDITIONS PRECEDENT TO THE CLOSING
Section 4.1. Conditions Precedent to Purchaser's Obligations. The
obligation of Purchaser to purchase and pay for the Assets at the Closing is
subject to the satisfaction of each of the following conditions precedent at
or prior to the Closing:
(a) Representations and Warranties. The representations and
warranties of the Company set forth in this Agreement or in any Exhibit,
certificate or Term Sheet delivered pursuant hereto shall be true and correct as
of the Closing Date except to the extent a representation or warranty is
expressly limited by its terms to another date.
(b) Performance of Covenants. The Purchaser shall have performed and
complied with all covenants and agreements contained herein required to be
performed or complied with by the Purchaser at or before the Closing Date.
(d) No Material Adverse Change. Since May 15, 2001, no change or
event shall have occurred which has had or could have a material adverse effect
with respect to the business or operations of the Purchaser.
(e) Corporate Proceedings (if applicable). All corporate and other
proceedings to be taken and all waivers and consents, approvals, qualifications
and/or registrations required to be obtained or effected in connection with the
execution, delivery and performance by the Purchaser of the transactions
contemplated in Section 1.1 herein, including the reservation, issuance, sale
and delivery of the securities, shall have been taken, obtained or effected
(except for the filing of any notice subsequent to such Closing which may be
required under applicable federal securities laws which, if required, the
Purchaser hereby
agrees to file on a timely basis as may be so required), and all documents
incident thereto, shall be reasonably satisfactory in form and substance to
Seller. Seller shall have received all such originals or certified or other
copies of such documents as have been reasonably requested.
(f) Other Agreements. The Seller and Purchaser shall have
entered into agreements reasonably satisfactory and:
i) Purchaser shall have the right to determine that 4Cash ATM Services,
the division of IRMG Inc., is as it has been represented.
ii) Xxxxxxxx Capital Limited ("SCL") shall convert its US $2,000,000
senior convertible subordinated debenture, plus all accrued interest
up to and including December 31,2000 to shares of the Purchaser's
common stock at US $1.00 (one dollar) per share.
iii) Upon the conversion of the Purchaser's debenture owned by SCL as
described in 4.1(f)(ii), Purchaser shall reduce the exercise price on
all warrants held by SCL to purchase five million (5,000,000) shares
of the Purchaser's common stock to US $0.50 (fifty cents) per share.
These warrants shall become fully vested on the Closing Date and shall
expire on December 31, 2004.
iv) All appropriate and necessary mutual due diligence shall have been
completed.
v) The execution of definitive agreements shall have been completed.
vi) Upon Closing, Mr. Xxxx Xxxxxx shall resign as Chairman, President and
CEO and CFO of Purchaser.
vii) Upon Closing and subsequent to the actions described in section 4.1
above, Xx. Xxxxxxx X. Cussons shall be appointed President and CEO and
Chairman of the Board of Directors of Purchaser.
viii) Upon Closing, Xx. Xxxx Xxxxxxxx shall be appointed CFO of Purchaser.
ix) Upon Closing, Mr. Xxxx Xxxxxx, Xx. Xxxxx X'Xxxx, Mr. Xxxxxxxx Xxx, and
Xx. Xxxxxx XxxXxxxxx shall resign from the board of Purchaser.
x) On the effective date of their resignation (the Closing Date), all
Directors Fees ("Fees"), accrued expenses, out of pocket costs and
monies owed ("Historical Costs") to Messers. Hickey, Simmonds, X'Xxxx,
Fox and MacDonald shall be paid on an equal proportionate basis as the
amounts paid to IRMG Inc., for services provided between January 01,
2001 and including May 31, 2001.
xi) As a condition of Closing all outstanding Director's options held by
Messrs. Xxxxxx, O'Kell, Simmonds, Fox, and MacDonald (300,000 each)
shall be returned to the Purchaser and Messrs. Xxxxxx, X'Xxxx, Xxx and
MacDonald will each be issued new fully vested options to purchase
100,000 (one hundred thousand) shares of the Purchaser's common stock
with an exercise price of US $0.10 (ten cents) per share and a term of
three (3) years from the Closing Date. The common shares underlying
these options shall be granted "piggy-back" registration rights.
xii) Upon Closing, Mr. Xxxxx Cussons, Xx. Xxxxx Xxxxx-Xxxxx and Xx. Xxxx X.
Xxxxxxxx shall be appointed to the Board of Directors of Purchaser.
Section 4.2. Condition Precedent to the Sellers' Obligations. The obligation of
the Sellers to sell the Assets at the Closing shall be subject to the
satisfaction of each of the following conditions precedent at or prior to the
Closing or subject to Section 4.2 (b):
(a) Payment. The Purchase Price consists of all of the terms
set out in Section 1.1 of this agreement.
(b) Purchase Shares and Purchase Warrants. The
Purchase Shares, the Purchase Warrants and the Cussons Warrants shall be
released and transferred to the Seller and or its assigns or its designees
within five (5) business days of Closing.
(c) Representations and Warranties. The representations and
warranties of Purchaser set forth in this Agreement or in any Schedule or
certificate delivered pursuant hereto shall be true and correct as of the
Closing Date except to the extent a representation or warranty is expressly
limited by its terms to another date.
(d) Performance of Covenants. Purchaser shall have performed and
complied with all covenants and agreements contained herein required to be
performed or complied with by Purchaser at or before the Closing Date.
(e) Material Adverse Change. Since June 15, 2001, no change or event
shall have occurred which has had or could have a material adverse effect with
respect to the business or operations of Purchaser.
(f) Secretary's Certificate. The Seller shall have received a
certificate, signed by the Secretary of Purchaser, certifying (i) that full and
complete copies of resolutions or similar documents evidencing the authorization
and approval by the Board of Directors of the Purchaser of the transactions
contemplated in Section 1.1, and (ii) as to the incumbency and specimen
signature of each authorized officer of Purchaser signing any of the documents
relating to the transactions contemplated herein to which Purchaser is a party
and any other document in connection therewith.
(g) Corporate Proceedings. All corporate and other proceedings to be
taken and all waivers and consents, approvals, qualifications and/or
registrations required to be obtained or effected in connection with the
execution, delivery and performance by Purchaser of the transactions
contemplated in Section 1.1 herein, including the reservation, issuance, sale
and delivery of the Purchase Shares and Purchaser Warrants shall have been
taken, obtained or effected (except for the filing of any notice subsequent to
such Closing which may be required under applicable federal securities laws
which, if required, Purchaser hereby agrees to file on a timely basis as may be
so required), and all documents incident thereto, shall be reasonably
satisfactory in form and substance to the Seller. The Seller shall have received
all such originals or certified or other copies of such documents as have been
reasonably requested.
ARTICLE V
COVENANTS
Section 5.1 Covenants by the Seller and the Purchaser. The Seller and Purchaser
hereby covenant and agree that the Seller shall afford to Purchaser, and
Purchaser shall afford to the Seller, and their employees, counsel and other
authorized representatives free and full access, upon reasonable advance notice
and during normal business hours, to all of the books, records and properties of
the Seller and Purchaser and to all officers and employees of the Seller and
Purchaser, for any reasonable purpose whatsoever relevant to the transaction
between the date hereof and the Closing Date. The Seller and Purchaser shall
maintain the confidentiality of any confidential and proprietary information so
obtained by either Party and shall cause its employees, counsel or other
authorized representatives to do the same; provided, however, that the foregoing
shall in no way limit or otherwise restrict the ability of Purchaser or the
Seller, or such authorized representatives to disclose any such information
concerning Purchaser or the Seller which Purchaser or the Seller may be required
to disclose pursuant to or as required by Law. In the event of a breach or
threatened breach of any of the provisions of this Section 6.1, the Seller if
applicable, or Purchaser if applicable, shall, in addition to all other
remedies, be entitled to a temporary or permanent injunction and/or a decree for
specific performance, in accordance with the provisions hereof, without
posting any bond and without showing any actual damage or that monetary damages
would not provide an adequate remedy.
ARTICLE VI
MISCELLANEOUS
Section 6.1. Survival of Representations, Warranties and Agreements, Etc. All
representations and warranties herein or made pursuant hereto or thereto shall
survive the Closing indefinitely. All statements contained in any schedule,
certificate or other instrument delivered by the Seller pursuant to this
Agreement shall constitute representations and warranties by the Seller. All
agreements contained herein shall survive indefinitely until, by their
respective terms, they are no longer operative.
Section 6.2. Indemnification. Each Party shall indemnify, defend and hold the
other Parties harmless against all claims, liability, loss or damage, together
with all reasonable costs and expenses related thereto (including legal and
accounting fees and expenses) (collectively, "Losses"), arising from the
untruth, inaccuracy or breach of any of the representations, warranties,
covenants or agreements of such Party herein or any facts or circumstances
constituting any such untruth, inaccuracy or breach or with respect to any
liability for any brokers' or finders' fees or compensation owing or alleged to
be owing in connection with the transactions contemplated hereby.
Section 6.3. Confidentiality. The Parties undertake to keep in strict
confidence, and not to use for any purpose unrelated to their proposed interest
in the Seller or the Purchaser, as the case may be, any and all information
relating in any way, to the Seller or the Purchaser which had been provided to
the Purchaser by the Seller, or the Sellers or the Purchasers by the Purchaser,
or was otherwise obtained by the Purchaser or the Seller, except information
which: (i) is or shall be in the public domain not due to any act of the
Purchaser or the Seller in breach of law or agreement; (ii) was initially
possessed by such Party without the obligation of confidentiality; (iii) was
rightfully received or shall be received without obligation of confidentiality
from a third party; or (iv) is required to be disclosed according to any law,
including under the assets laws of the United States. In the event of disclosure
required from a Party according to any law, including under the securities laws
of the United States, such Party shall use all reasonable efforts to obtain
confidential treatment of materials required to be disclosed. Notwithstanding
the aforesaid, in connection with periodic reports to its shareholders,
investors or partners prior to the Closing Date, the Purchaser or the Seller may
only make general statements, not containing any technical or specific business
information, regarding the general nature and progress of the Purchaser's or the
Seller's business, and if required under applicable law may provide summary
financial information of the Purchaser or the Seller.
Section 6.4. Remedies. In case any one or more of the covenants and/or
agreements set forth in this Agreement shall have been breached by a Party, the
other Parties may proceed to waive or to protect and enforce their respective
rights either by suit in equity, including an action for specific performance,
injunctive relief and other forms of equitable relief (without posting any bond
and without proving that damages would be inadequate) of any such covenant or
agreement contained in this Agreement. All remedies hereunder shall be
cumulative and the election of any one remedy shall not preclude any other
remedy.
Section 6.5. Successors and Assigns. This Agreement shall bind and inure to the
benefit of the Parties hereto and their respective successors and permitted
assigns, personal representatives, heirs, executors and estates.
Section 6.6. Sale, Disposal and Assignment of Assets. This Agreement shall not
prohibit, limit or bind the Purchaser, at any time, from the sale, assignment or
otherwise disposal of all or any part or any interest therein of the Assets
purchased.
Section 6.7. Notices. All notices, requests, consents and other communications
hereunder to any Party shall be deemed to be sufficient if contained in a
written instrument delivered in person or sent by telecopy,
nationally-recognized overnight courier or first class-registered or certified
mail, return receipt
requested, postage prepaid, addressed to such Party at the address set forth
below, or such other address, telecopy number or person's attention, as may
hereafter be designated in writing by such Party to the other Parties:
(a) If to the Purchaser:
Wireless Ventures Inc.
000 0xx Xxx. Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxx
Telephone: 000-000-0000
Telecopier: (000) 000-0000
OR
Xxxxxx X. XxxXxxxxx
000 Xxxx 00xx Xxxxxx, Xxxxx 00 X
Xxx Xxxx, Xxx Xxxx 00000
Telephone: 000-000-0000
Telecopier: 000-000-0000
Cellular: 000-000-0000
With copies to:
Xxxxxxxx Capital Limited
00000 Xxxx Xxxxxx
Xxxx Xxxx, Xxxxxxx X0X 0X0
Xxxxxx
Attention: Xxxx X. Xxxxxxxx,
Chairman and CEO, Xxxxxxxx Capital Ltd.
Telephone: 000-000-0000
Telecopier: 000-000-0000
if to the Seller, to:
Xxxxxxx Cussons
C/o IRMG Inc.
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Telephone: 000-000-0000
Telecopier: 000-000-0000
All such notices, requests, consents and other communications shall be deemed to
have been delivered (i) in the case of personal delivery or delivery by
telecopy, on the date of such delivery, (ii) in the case of dispatch by
nationally-recognized overnight courier, on the next business day following such
dispatch and (iii) in the case of mailing, on the fifth business day after the
posting thereof.
Section 6.8. Amendment; Waiver. This Agreement may be amended, supplemented or
otherwise modified only by the written agreement of the Parties. Any waiver of
any provision of this Agreement shall be in writing and executed by the Parties,
and any such waiver shall be effective only for the specific purpose for which
it is given and for the specific time period, if any, contemplated therein.
Section 6.9. Counterparts. This Agreement may be executed in any number of
counterparts each of which when so executed and delivered shall be deemed an
original and all of which taken together shall constitute one agreement. This
Agreement may be delivered by facsimile transmission with the same effect as if
delivered in person.
Section 6.10. Severability. Any provision in this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability at such time
without invalidating the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction at such time shall not invalidate or render
unenforceable such provision in any other jurisdiction or in the same
jurisdiction at any other time. To the extent permitted by applicable law, the
Parties hereto waive any provision of law which renders any provision hereof
prohibited or unenforceable in any respect.
Section 6.11. Further Assurances. By its signature hereto, each Party consents
and agrees to all of the transactions contemplated hereby. Each Party hereto
shall execute, deliver, file and record any and all instruments, certificates,
agreements and other documents, and take any and all other actions, as
reasonably requested by any other Party hereto in order to consummate the
transactions contemplated hereby.
Section 6.12. Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the Province of Ontario to contracts
made and to be wholly performed within such Province, without reference to
principles of conflicts of laws.
Section 6.13. Entire Agreement; Interpretation. This Agreement contains the
entire agreement between the Parties relating to the subject matter hereof and
supersedes all oral statements and prior writings with respect thereto. The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement. A
reference to a gender in this Agreement shall be interpreted to include the
masculine, feminine and/or neutral gender, as applicable.
[Signature page follows]
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the date first written above.
SELLER:
IRMG Inc.
By: /s/ Xxxxxxx Cussons
-------------------------------
Name: Xxxxxxx Cussons
Title: President/CEO
PURCHASER:
Wireless Ventures Inc.
By: /s/ Xxxx Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: Chief Executive Officer
SCHEDULES
A) MANAGEMENT SERVICES AGREEMENT
SCHEDULE A
----------
Management Services Agreement
By and between
IRMG Inc. and Wireless Ventures Inc.
This Management Services Agreement (this "Agreement") made as of the 15th day of
June 2001, by and between IRMG Inc. ("IRMG"), an Ontario corporation
(hereinafter "Provider"), and WIRELESS VENTURES INC., a corporation organized
under the laws of Delaware (hereinafter the "Company").
WHEREAS, the Company has the need for certain executive, accounting and
financial reporting, human resources, information technology and other general
management and administrative services relating to its operations, including
personnel services, business development, office space and services and investor
relations; and
WHEREAS, Provider has agreed to provide such executive, accounting and financial
reporting, human resources, information technology and other general management
and administrative services relating to its operations, including personnel
services, business development, office space and services and investor
relations; and
WHEREAS, the Company has agreed to reimburse Provider for the cost of such
executive, accounting and financial reporting, human resources, information
technology and other general management and administrative services relating to
its operations, including personnel services, business development, office space
and services and investor relations; and
NOW, THEREFORE, for and in consideration of the foregoing and the terms and
conditions contained hereinafter, the parties hereto agree as follows:
Term.
1.1 The term of this agreement shall be for three (3) years commencing from the
date hereof to June 15, 2004; provided, however, WLSV may cancel and terminate
this agreement if the Company has not achieved US $1,000,000 cumulative net
profit before tax within two (2) years of the closing date, however that either
party may terminate this Service Agreement upon the default for cause of the
other party under this Service Agreement and the failure of such defaulting
party to cure such default within thirty (30) calendar days after receipt of
written notice by registered mail specifying the event or default claimed. If
such default is not cured within the thirty (30) day period, the terminating
party may give immediate notice of termination at any time thereafter. Cause
shall constitute any and all fraud, deceit or dishonesty. Termination will not
negate payments due to the Provider under the terms of this agreement. This
agreement will automatically renew for a term of two (2) years unless 180 days
prior written notice is provided to either party of intent to terminate this
agreement.
2.0 Services.
2.1 Provider agrees to provide, and the Company agrees to accept, executive,
accounting and financial reporting, human resources, information
technology and other general management and administrative services
relating to its corporate operations, including personnel services,
business development, office space and basic services and investor
relations, described in Exhibit A attached hereto and as otherwise
mutually agreed by Provider and the Company (the "Services").
2.2 If not otherwise agreed, the specification of particular methods for
rendering the Services and the assignment of personnel therefore will be
determined by Provider in such manner as in Provider's
judgment will best serve the objectives indicated by the Company. Such
methods may include, but are not limited to: (a) remote consulting (by
telephone, fax, E-mail, video conferencing, etc.); (b) written advice;
(c) participation in meetings, seminars and workshops; (d) secondment
of employees for specific activities; (e) supply of technical
materials, studies and other information; (f) introduction to persons,
firms/companies which may be of interest to the Company; and (g) other
means mutually agreed upon from time to time.
3.0 Compensation.
3.1 In consideration for the Services, the Company shall pay Provider a fee of
USD. $55,000 per month, payable in advance for each calendar month plus a
royalty of 10% of the Purchaser's cumulative earnings before taxes
depreciation and interest ("EBITDA") after Closing Date, paid by the
Purchaser to the Seller, or its assignee or designee, quarterly in arrears
(the "Royalty"). The Company shall also reimburse Provider for its
reasonable out-of-pocket expenses incurred in connection with the
Services, payable upon delivery of the Providers' invoice therefor.
4.0 Obligations.
4.1 The Company agrees to fully cooperate with Provider and to supply Provider
with any and all information reasonably necessary to enable Provider to
perform the Services hereunder, in such form as may be reasonably
requested. The Company will give Provider representatives' free access to
any and all sources of information reasonably necessary to enable Provider
to satisfactorily perform the Services.
4.2 Provider agrees to fully cooperate with the Company and to supply the
Company with any and all information reasonably necessary to enable the
Company to meet its legal and tax requirements.
5.0 Liability.
5.1 Provider shall have no liability to the Company except to the extent of
the actual damages (excluding lost profits or special or punitive damages)
suffered by the Company as a direct result of the gross negligence or
greater culpability of Provider.
6.0 Indemnity.
6.1 The Company shall indemnify Provider and its officers, directors,
employees, independent contractors, agents and representatives, in their
capacities as such (each, an "Indemnified Party"), against and hold them
harmless from any and all damage, claim, loss, liability and expense
(including, without limitation, reasonable attorneys' fees and expenses)
incurred or suffered by any Indemnified Party arising out of or relating
to the Services, except to the extent that such damage, claim, loss,
liability or expense is found in a final non-appeal able judgment to have
resulted from Provider's gross negligence or wilful misconduct.
7.0 Independent Contractor.
7.1 The relationship between Provider and the Company is that of independent
contractor. Neither Provider nor the Company is, or may hold itself out
as, an agent for or employee of the other. Neither Provider nor the
Company shall have any authority to take, and neither shall take, any
action, which binds, or purports to bind, the other. Without limiting the
foregoing, no employee of Provider may make any claim, demand or
application to or for any right or privilege applicable to an officer or
employee of the Company, including but not limited to workmen's
compensation coverage, unemployment insurance benefits, social security
coverage, health plan or insurance benefit, any other insurance benefit or
any retirement benefit unless otherwise agreed to by the parties.
8.0 Notices.
8.1 All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be (i) sent by registered or certified
mail, return receipt requested, (ii) hand delivered, (iii) sent by electronic
mail, or (iv) sent by prepaid overnight carrier, with a record of receipt, to
the parties at the following addresses (or at such other addresses as shall be
specified by the parties by like notice): if to Provider at:
(i) IRMG Inc.
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx XX, X0X 0X0
Attn: Xxxxxxx X. Cussons
President & CEO
(ii) if to the Company at:
Wireless Ventures Inc.
000 0xx Xxx., Xxxxx 0000
Xxx Xxxx, X. Y. 10019
Attn: Xxxx X Xxxxxx
President & CEO
Each notice or communication shall be deemed to have been given on the date
received.
9.0 Miscellaneous Provisions.
9.1 This Agreement contains the complete understanding of the parties hereto
and there are no understandings, representations, or warranties of any
kind, express or implied not specifically set forth herein. This Agreement
may be amended only by written documents signed by duly authorized
representatives of each of the parties hereto.
9.2 This Agreement shall be governed, construed and interpreted in accordance
with the laws of the Province of Ontario.
9.3 This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which taken together shall
constitute a single agreement.
9.4 This Agreement shall be for the benefit of Provider and the Company and
shall be binding upon the parties and their respective successors and
permitted assigns.
9.5 Every provision of this Agreement is intended to be severable. If any term
or provision hereof is illegal or invalid for any reason whatsoever, such
term or provision shall be enforced to the maximum extent permitted by law
and, in any event, such illegality or invalidity shall not affect the
validity of the remainder of the Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the
day and year first above written.
IRMG Inc. WIRELESS VENTURES Inc.
Per: Per:
/s/ Xxxxxxx Cussons /s/ Xxxx Xxxxxx
----------------------------------- ----------------------------------
Xxxxxxx X. Cussons, President & CEO Xxxx X. Xxxxxx, President & CEO
EXHIBIT A
The Services to be rendered under this Agreement may include, without
limitation, the following:
1. Assistance, advice and support in strategic policy, preparation of regular
operating reviews, attendance at board meetings and the provision of
operations consultancy and support;
2. Assistance, advice and support in new and existing services including
technical support, quality controls, market research and development;
3. Assistance, advice and support in business organization, administration and
logistics;
4. Assistance, advice and support in business development, marketing,
promotion, advertising and investor relations;
5. Assistance, advice and support in purchasing, including selection and
identification of suppliers;
6. Assistance, advice and support in human resources and training, including
personnel recruitment, training and management as well as advice and
assistance in human resource policies and procedures;
7. Assistance and advice in financial matters, including access to funds,
cooperation with banks, cash management and treasury management;
8. Assistance, advice and support in accounting and financial reporting,
including preparation of business plans, budgets, forecasts, management
accounts and project cost accounts;
9. Assistance, advice and support in risk management and insurance matters;
10. Assistance, advice and support in negotiating agreements with third
parties;
11. Provider may make available to the Company the services of such of
Provider's directors or executives for any purposes of the business
including taking up appointments as directors, whether executive or
non-executive, of the Company.
12. Specifically under this agreement the Provider will include the following:
Office Space and Basic Services
The following executives and appropriate responsibilities and obligations those
positions hold:
President and Chief Executive Officer Xxxxxxx X. Cussons
Chief Financial Officer Xxxx Xxxxxxxx
Vice President Business Development To Be Announced
Corporate Governance Administrator To Be Announced
Controller Xxxx Xxxxxx
General Administrative & Accounting Staff To Be Announced
Should it be determined the Company requires additional services and human
resources, the Company and the Provider upon mutual consent may amend this
agreement to incorporate any additions and fees associated with the amendments
where the Company does not wish to employee or contract directly.
