ASSIGNMENT AND ASSUMPTION and MANAGEMENT AGREEMENT
ASSIGNMENT
AND ASSUMPTION
and
This
Assignment and Assumption and Management Agreement (this “Agreement”) is made
and entered into on June __, 2007, by and among the following parties (each,
a
“Party” and collectively, the “Parties”): itLinkz Group, Inc., a Delaware
corporation (the “Company”), itLinkz Corporation, a Delaware corporation (the
“Subsidiary”) and Xxxxxx X. Xxxxxxx (the “Manager”).
WHEREAS,
the
Company is engaged in the business of developing a series of social and business
networking community websites which will allow members to build online
communities, as further described below (the “Business”); and
WHEREAS,
the
Company operates the Business on leased premises located at 0000 Xxxxxxxxxx
Xxxx, Xxxxx 000, Xxxxxxxxx, XX (the “Premises”); and
WHEREAS,
the
Company has caused the Subsidiary to be formed and organized as the Company’s
wholly owned subsidiary; and
WHEREAS,
the
Company desires to transfer all of the assets of the Business to the Subsidiary
and to cause the Subsidiary to assume all liabilities and obligations of
the
Company accrued as of the time of Closing, as more fully described herein;
and
WHEREAS,
the
Manager has agreed to guarantee personally the obligations to the Company
assumed by the Subsidiary, including the liabilities assumed and the
indemnification obligation described herein; and
WHEREAS,
on
the
date of and immediately following the closing of the transactions contemplated
by this Agreement, the Company intends to consummate the closing of a share
purchase and merger pursuant to the terms of a Share Purchase and Merger
Agreement dated June 1, 2007 (the “Merger Agreement”) by and among the Company,
Landway Nano Bio-Tech, Inc. and others; and
WHEREAS,
as a
condition to consummation of the merger pursuant to the Merger Agreement,
the
Manager, who is the sole officer of the Company, must resign from his position
in management of the Company; and
WHEREAS,
the
Subsidiary wishes to engage the Manager, and the Manager wishes to be engaged,
to manage and operate the business of the Subsidiary, effective at the Time
of
Closing (defined herein) and upon the terms and conditions set forth herein;
NOW,
THEREFORE, in
consideration of the mutual promises made herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, agree as
follows:
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ARTICLE
1:
TRANSFER
AND ASSIGNMENT OF ASSETS
The
business of the Company is to develop a series of social and business networking
community websites which will allow members to build online communities focused
on shared interests, and to collaborate, share knowledge and team up with
other
members on projects relating to their common interest (the “Business”). The
assets and operations within the scope of the “Business” include the following:
the Company has reserved certain domain names which are variations of the
domain
name “xxxxxx.xxx,” such as “xxxxxxxxxxxx.xxx, and the Company has advertising
contracts with certain parties.
On
the
terms and subject to the conditions herein expressed, the Company hereby
sells,
conveys, transfers, assigns, sets over and delivers to Subsidiary at the
Time of
Closing (as defined in Section 4.1), and Subsidiary assumes and accepts,
all of
the assets, rights and interests, tangible and intangible, of every kind,
nature
and description, then owned, possessed or operated by Company and used in
the
operation of the Business, wheresoever situate (collectively, the “Assets”),
including without limitation the following:
1.1 Machinery
and Equipment.
All
machinery, equipment, computers and computer hardware, office furniture and
fixtures, and other fixed or tangible assets;
1.2 Inventories.
All
inventories, including without limitation merchandise, materials, component
parts, production and office supplies, stationery and other imprinted material,
promotional materials, and business records;
1.3 Licenses
and Permits.
All
licenses, permits and authorizations used by the Company to own and operate
all
of the Assets , to conduct the Business and to occupy the Premises for the
purpose of conducting the Business thereon;
1.4
Intangible Property.
All
intangible assets of Company which are transferable including, but not limited
to, customer and supplier lists, privileges, permits, licenses, software
and
software licenses, certificates, commitments, goodwill, registered and
unregistered patents, trademarks, service marks and trade names, and
applications for registration thereof and the goodwill associated therewith,
including without limitation the exclusive right to use the name “itLinkz” or
derivations thereof in the Business, domain names using the words “xxxxxx.xxx,”
the right to receive mail related to the Business and the Assets which is
addressed to the Company, and the right to telephone numbers used at the
Premises in the Business;
1.5 Cash
and Accounts Receivable.
All
accounts receivable, deposit accounts, cash and cash equivalents and securities
owned by the Company including, without limitation, the cash proceeds of
the
Share Purchase received by the Company pursuant to the Merger
Agreement;
1.6 Contract
Rights.
All
rights and benefits of or in favor of Company resulting or arising from any
contracts, purchase orders, sales orders, forward commitments for goods or
services, leases (including security deposits held by the landlord pursuant
to
the lease of the Premises), franchise or license agreements, beneficial
interests in covenants not to compete or confidentiality covenants, the rights
of Company related to any other agreements whatsoever which arise out of
the
operation of the Business; and
1.7 Claims.
Claims
made in lawsuits and other proceedings filed by the Company, judgments and
settlements in the Company’s favor, rights to refunds, including rights to and
claims for federal and state income and franchise tax refunds and refunds
of
other taxes paid based upon or measured by the income of the Business prior
to
the Closing, and insurance policies and rights accrued thereunder.
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ARTICLE
2:
ASSUMPTION
OF LIABILITIES
2.1 Scope
of Liabilities Assumed.
The
Subsidiary shall assume, pay, perform or discharge the following:
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a.
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any
and all debts, liabilities or obligations of any nature of the
Company or
the Subsidiary, whether contingent or fixed and whether known or
unknown,
which have accrued at the Time of Closing including, without limitation,
the Company’s obligations to the Manager described in the financial
statements contained in the Company’s quarterly report filed with the
Securities and Exchange Commission for the period ending March
31, 2007,
which refer to loans having a principal balance (as of the date
of said
financial statements) of $955,120.
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b.
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any
and all debts, liabilities or obligations of any nature of the
Subsidiary,
whether contingent or fixed and whether known or unknown, arising
from the
ownership or operation of the Assets or the Business or the occupation
of
the Premises either before or after the Time of Closing.
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The
Operating Subsidiary shall promptly provide for payment, performance and
discharge of the same in accordance with their terms. The Manager agrees
personally and unconditionally to guarantee performance of the obligations
assumed by the Operating Subsidiary as described herein.
ARTICLE
3:
COLLECTION
OF ACCOUNTS RECEIVABLE
3.1 Right
to Collect. Following
the closing, Subsidiary shall have the right to collect the accounts receivables
of the Company and to settle, compromise, xxx for collection, or take any
action
whatsoever with respect to the receivables. Company shall cooperate with
Subsidiary in notifying customers as to any payment instructions or change
of
address that Subsidiary may wish to communicate to the customers. In the
event
Company receives payment of any receivable transferred to the Subsidiary,
it
shall promptly endorse such payment and deliver it over to the Subsidiary.
ARTICLE
4:
THE
CLOSING
4.1 The
Closing.
The
closing of the transactions contemplated in this Agreement (“Closing”) shall
take place simultaneously with the closing of the transactions contemplated
under the Merger Agreement. The effective time of closing is referred to
herein
as the “Time of Closing.”
4.2 Deliveries
by Company.
At
Closing, Company shall deliver to Subsidiary, in addition to all other items
specified elsewhere in this Agreement, the following:
(a) Such
instruments of sale, conveyance, transfer, assignment, endorsement, direction
or
authorization as will be required or as may be desirable to vest in Subsidiary,
its successors and assigns, all right, title and interest in and to the Assets,
subject to any and all mortgages, pledges, liens, encumbrances, equities,
charges, conditional sale or other title retention agreements, assessments,
covenants, restrictions, reservations, commitments, obligations, or other
burdens or encumbrances of any nature whatsoever that exist at the Time of
Closing;
(b) All
of
the files, documents, papers, agreements, books of account and records
pertaining to the Assets and the Business;
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(c) Actual
possession and operating control of the Assets; and
(d) To
the
extent required, the consents of third parties to the assignment and transfer
of
any of the Assets.
4.3 Deliveries
by Subsidiary.
At
Closing, the Subsidiary shall deliver to the Company any instruments, in
addition to this Agreement, as the Company deems necessary or desirable fully
to
secure the assumption by the Subsidiary, its successors and assigns, of all
liabilities and obligations of the Company, as described Section 2.1
hereof.
ARTICLE
5:
COVENANTS
ON AND SUBSEQUENT TO THE CLOSING DATE
On
and
after the Closing Date, Subsidiary and Company (as the case may be) covenant
as
follows:
5.1 Pay
Creditors.
Following the Closing, Subsidiary shall pay all payables and other obligations
of Company assumed hereunder by the Subsidiary, as such obligations become
due
in the ordinary course of business.
5.2 Lawsuits.
Without
limiting the generality of Section 2.01, following the Closing, the Subsidiary
shall continue the defense of any and all lawsuits or other claims filed
or
threatened against the Company.
5.3 Insurance
Policies.
Subsidiary shall name the Company as an additional insured on all insurance
policies transferred by the Company or any other insurance policies covering
the
period prior to the Time of Closing, and Subsidiary shall provide proof of
such
coverage to the Company upon request.
5.4 Right
to Inspect Records.
The
Subsidiary shall permit the Company and its agents to have reasonable access
to
the books and accounts of the Subsidiary (at the expense of the Company)
for the
purpose of filing tax returns, preparing filings required by the Securities
and
Exchange Commission, and all other legitimate purposes.
5.5 Execution
of Further Documents.
Upon
the request of either party, the other party shall execute, acknowledge and
deliver all such further acts, deeds, bills of sale, assignments, assumptions,
undertakings, transfers, conveyances, title certificates, powers of attorney
and
assurances as may be required , in the case of Subsidiary, to convey and
transfer to, and vest in, Subsidiary all of Company’s right, title and interest
in the Assets, and in the case of the Company, to secure the assumption by
Subsidiary of the Company’s obligations and liabilities arising as of the Time
of Closing.
5.6 Change
of Corporation Name.
Promptly after the Closing and, in any case, no later than December 31, 2007,
the Company shall change its corporate name to a name that does not include
the
word “itLinkz.”
ARTICLE
6: MANAGEMENT
AND OPERATION OF SUBSIDIARY
6.1 Titles.
The
Subsidiary hereby engages the Manager to manage and operate its business.
Xxxxxx
X. Xxxxxxx shall serve as a member of the Board of Directors of the Subsidiary.
The Manager shall initially serve as the sole officer of the Subsidiary and
shall have the titles of President and Secretary, subject to the right of
the
Board of Directors of the Subsidiary to appoint additional
officers.
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6.2 Duties. The
Manager agrees that he will manage and operate the business of the Subsidiary
to
the best of his abilities and will devote such time and effort as necessary
to
fulfill his duties under this Agreement.
6.3 Management
of Subsidiary.
The
Company agrees that the Manager will have exclusive authority over the
operations of the Operating Subsidiary, except that the Company shall be
entitled to intervene in the event that a breach of the covenants in this
Agreement or any conduct by the Manager in the course of operating the
Subsidiary threatens the Company with material harm or material liability
of any
kind. (In any such event, the Company shall be entitled to remove the directors
and officers of the Subsidiary and to elect a new Board of Directors.) The
Manager shall maintain such books and records of the operations of the
Subsidiary as are required by the Rules of the SEC, and shall prepare quarterly
and annual financial statements promptly so as to permit the Company to file
periodic reports with the SEC according to SEC Rules
6.4 Company’s
Covenants.
The
Company shall not cause any funds or assets of the Subsidiary to be paid
or
transferred to the Company, nor shall the Company cause the Subsidiary to
issue
any capital stock of any class or series or any options, warrants or rights
to
acquire capital stock of the Subsidiary whether for additional consideration
or
on conversion.
6.5 Spin
Off of Subsidiary.
On the
thirtieth day following the Closing under the Merger Agreement, the Company
shall cause all of the stock of the Subsidiary to be transferred and assigned
to
the Manager in consideration of the Manager’s guarantee of the obligations of
the Subsidiary to the Company, the Manager’s agreement to assume personal
liability for the indemnification obligations of the Company, both as set
forth
herein, and the Manager’s release of the Company from all obligations to him.
Promptly after the Closing, the parties will negotiate in good faith a written
contract embodying the terms set forth in this Section 6.5.
ARTICLE
7:
INDEMNIFICATION
7.1 Indemnification
by Subsidiary and Principal Shareholder.
From
and after the Closing, Subsidiary and the Manager shall, jointly and severally,
indemnify and save Company, its officers and directors, and their respective
successors, assigns, heirs and legal representatives (“Company Indemnitees”)
harmless from and against any and all losses, claims, damages, liabilities,
costs, expenses or deficiencies including, without limitation, actual attorneys’
fees and other costs and expenses incident to proceedings or investigations
or
the defense or settlement of any claim, incurred by or asserted against any
Company Indemnitee due to or resulting from a violation or default by Subsidiary
with respect to any of Subsidiary’s covenants, obligations or agreements
hereunder and any losses or expenses incurred in connection with, or payment
by
Company of the debts, liabilities and obligations assumed by the Subsidiary
hereunder or the debts, liabilities and obligations of the Subsidiary arising
after the Time of Closing.
7.2 Indemnification
Procedures.
(a) The
party
seeking indemnification (“Indemnified Party”) shall give the indemnifying party
(“Indemnifying Party”) notice (a “Claim Notice”) of its indemnification claim
which notice shall (i) be in writing, (ii) include the basis for the
indemnification, and (iii) include the amount Indemnified Party believes
is the
amount to be indemnified, if reasonably possible.
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(b) Indemnifying
Party shall be deemed to accept Indemnified Party’s claim unless, within twenty
(20) business days after receipt of any Claim Notice, Indemnifying Party
delivers to Indemnified Party notice of non-acceptance of the indemnification
claim, which must (a) be in writing and (b) include the basis for the
disagreement.
(c) The
parties shall attempt in good faith to resolve any issues concerning liability
and the amount of such claim, and any issues which they cannot resolve within
thirty (30) days after delivery of the notice of non-acceptance pursuant
to
Section 7.2(b) shall be settled by arbitration in accordance with the rules
of
the American Bar Association, by a sole arbitrator located in New York, NY
or
such other location as the parties shall agree, whose determination shall
be
final and binding on the parties hereto. The arbitration shall be governed
by
the United States Arbitration Act, 9 U.S.C. §§ 1-16, and judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof. The arbitrator shall have the authority to award legal fees,
arbitration costs and other expenses, in whole or in part, to the prevailing
party.
ARTICLE
8:
MISCELLANEOUS
8.1 Benefit.
This
Agreement shall be binding upon, and inure to the benefit of, the Parties
hereto
and their respective successors, assignees, heirs and legal representatives.
8.2 Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of Delaware.
8.3 Amendment,
Modification and Waiver.
Any
Party hereto may waive in writing any term or condition contained in this
Agreement and intended to be for its benefit; provided, however, that no
waiver
by any Party, whether by conduct or otherwise, in any one or more instances,
shall be deemed or construed as a further or continuing waiver of any such
term
or condition. Each amendment, modification, supplement or waiver shall be
in
writing and signed by the Party or Parties to be charged.
8.4 Entire
Agreement.
This
Agreement and the exhibits, schedules and other documents expressly provided
hereunder or delivered herewith represent the entire understanding of the
parties.
8.5 Notices.
All
notices and other communications under this Agreement shall be in writing
and
shall be deemed to have been duly given or made as follows:
(a) If
sent
by reputable overnight air courier (such as Federal Express), 2 business
days
after being sent;
(b) If
sent
by facsimile transmission, with a copy mailed on the same day in the manner
provided in clause (a) above, when transmitted and receipt is confirmed by
the
fax machine; or
(c) If
otherwise actually personally delivered, when delivered.
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All
notices and other communications under this Agreement shall be sent or delivered
as follows:
If
to the
Company, to:
Xxxxxxx
Xxxx
Landway
Nano Bio-Tech, Inc.
00
Xxxxxxxx Xxxxx
Xxxx
Xxxxxxx, XX 00000
Telephone:
000-000-0000
Facsimile:
000-000-0000
with
a
copy to (which shall not constitute notice):
Telephone:
Facsimile:
If
to the
Subsidiary or the Manager, to:
Xxxxxx
X.
Xxxxxxx
itLinkz
Corporation
0000
Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
Telephone:
000-000-0000
Facsimile:
000-000-0000
with
a
copy to (which shall not constitute notice):
Xxxxxx
Xxxxxx, Esq.
00
Xxxxxxxx Xxxx
Xxxxxxxxx,
XX 00000
Telephone:
000-000-0000
Facsimile:
000-000-0000
Each
Party may change its address by written notice in accordance with this Section.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on
June ____, 2007.
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By:
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Xxxxxx
X. Xxxxxxx, Chief Executive Officer
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XXXXXX
X. XXXXXXX
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ITLINKZ
CORPORATION
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By:
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Xxxxxx
X. Xxxxxxx, Chief Executive Officer
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