EXHIBIT 2.1
FORM
OF
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is entered into this
5th day of March, 2002, by and between Reality Wireless Networks, Inc., a Nevada
corporation (the "Purchaser") and Reality Networks, Inc., a Delaware corporation
(the "Seller").
WHEREAS, the Seller is engaged in the business of providing of fixed,
wireless, high-speed, broadband Internet access to residential homes and small
businesses and is the owner of assets including, but not limited to, equipment,
inventories, intellectual property, contract rights, leasehold interests and
miscellaneous assets used in connection with the operation of its business; and
WHEREAS, the Purchaser desires to purchase, and the Seller desires to
sell, the all the assets used or useful, or intended to be used, in the
operation of the Seller's business; and
NOW, THEREFORE, for and in consideration of the premises, and the
mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:
1. Assets Purchased. The Seller agrees to sell to the Purchaser and the
Purchaser agrees to purchase from the Seller, on the terms and conditions set
forth in this Agreement, all of the Seller's then existing assets and business
related to it business as a going concern (the "Assets").
2. Excluded Assets. Excluded from this sale and purchase are the
Seller's corporate seals, minute books, stock transfer books, general ledger and
other accounting records (except as otherwise provided herein), other records
related exclusively to the organization, existence or share capitalization of
the Seller, its affiliates, subsidiaries, together with the Seller's rights
under any contract between the Seller and any third party and to which consent
to assignment to the Purchaser is required, but has not been obtained on the
Closing Date, as defined in Section 8.1. The Seller shall make its general
ledger and other accounting records available for inspection by the Purchaser
from time to time upon reasonable request.
3. Liabilities Assumed. The Purchaser agrees to assume and pay,
discharge or perform, as appropriate, (i) all unfilled orders from customers of
the Seller assigned to the Purchaser pursuant to Section 1, and (ii) all
purchase orders for inventory items ordered by the Seller prior to the Closing
Date, but that will not be delivered until after the Closing Date (the "Assumed
Liabilities"). The obligations of the Purchaser under this Section are subject
to whatever rights the Purchaser may have under this Agreement or otherwise for
breach by the Seller of any representation, warranty, covenant or agreement
contained in this Agreement, including but not limited to any right of
indemnification provided by this Agreement.
4. Purchase Price. In consideration of the sale, transfer and
conveyance to the Purchaser of the Assets and the Assumed Liabilities, Purchaser
shall transfer to Seller eight million, four hundred and forty-nine thousand,
three hundred and twenty (8,449,320) shares (the "Shares") of common stock, par
value $.001 per share, of the Purchaser (the "Purchase Price"). The number of
Shares to be transferred to Seller shall be appropriately adjusted to reflect
the effect of any stock split, reverse split, stock dividend, reorganization,
recapitalization or other like change with respect to Seller's common stock
occurring after the Closing Date, as defined in Section 8.1, and prior to the
Closing, so as to provide Seller the same economic effect as contemplated by
this Agreement prior to such stock split, reverse split, stock dividend,
reorganization, recapitalization, or like change.
5. Payment of Purchase Price. At the Closing, the Purchaser shall
issue, or direct its transfer agent to issue the Shares to the Seller, on
account of the Purchase Price.
6. Adjustments. The operation of the Seller's business and related
income and expenses up to the close of business on the day before the Closing
Date shall be for the account of the Seller and thereafter for the account of
the Purchaser.
7. Registration Rights Agreement. At Closing, the parties shall execute
a registration rights agreement, substantially the form of Exhibit A hereto (the
"Registration Rights Agreement"), under which Seller is granted certain rights
to have the Shares registered for resale to the public.
8. Closing.
8.1 Time and Place. The closing of the sale and purchase of
the Assets (the "Closing") shall take place at The Xxxx Law Group, PLLC, at 5:00
p.m. on March 5, 2002 ("Closing Date"), or at such other time as the parties may
agree in writing.
8.2 Obligations of Seller at the Closing. At the Closing, the
Seller shall execute, or cause to be executed, and shall deliver to the
Purchaser the following:
8.2.1 a xxxx of sale, substantially in the form of Exhibit
B hereto (the "Xxxx of Sale");
8.2.2 the Registration Rights Agreement;
8.2.3 a certificate of the Seller representing and
warranting to the Purchaser that each of the
representations and warranties of the Seller in this
Agreement was accurate in all respects as of the date
of this Agreement and is accurate in all respects as
of the Closing Date as if made on the Closing Date;
and
8.2.4 such other documents as the Purchaser may reasonably
request for the purpose of (A) evidencing the
accuracy of any of Seller's representations and
warranties, (B) evidencing the performance by Seller
of, or the compliance by Seller with, any covenant or
obligation required to be performed or complied with
by it, (C) evidencing the satisfaction of any
condition referred to in this Agreement, or (D)
otherwise facilitating the consummation or
performance of any of the transactions contemplated
in this Agreement.
8.3 Obligations of Purchaser at the Closing. At the Closing,
the Purchaser shall execute, or cause to be executed, and shall deliver to the
Seller the following:
8.3.1 the Xxxx of Sale;
8.3.2 the Registration Rights Agreement;
8.3.3 a certificate of the Purchaser to the effect that
each of the Purchaser's representations and
warranties in this Agreement was accurate in all
respects as of the date of this Agreement and is
accurate in all respects as of the Closing Date as if
made on the Closing Date; and
8.3.4 such other documents as the Seller may reasonably
request for the purpose of (A) evidencing the
accuracy of any representation or warranty of the
Purchaser, (B) evidencing the performance by the
Purchaser of, or the compliance by the Purchaser
with, any covenant or obligation required to be
performed or complied with by the Purchaser, (C)
evidencing the satisfaction of any condition referred
to in this Agreement, or (D) otherwise facilitating
the consummation or performance of any of the
transactions contemplated in this agreement.
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8.4 Possession. Simultaneously with such deliveries, Seller
shall take all action necessary or appropriate to put Purchaser in actual
possession and operating control of the Assets.
9. Seller's Obligation Prior to Closing.
9.1 Seller's Operation of Business Prior to Closing. The
Seller agrees that between the date of this Agreement and the Closing Date, the
Seller will:
9.1.1 Continue to operate the business that is the subject
of this Agreement in the usual and ordinary course
and in substantial conformity with all applicable
laws, ordinances, regulations, rules or orders, and
will use its best efforts to preserve its business
organization and preserve the continued operation of
its business with its customers, suppliers and others
having business relations with the Seller.
9.1.2 Not assign, sell, lease or otherwise transfer or
dispose of any of the assets used in the performance
of its business, whether now owned or hereafter
acquired, except in the normal and ordinary course of
business and in connection with its normal operation.
9.1.3 Maintain all of its assets other than inventories in
their present condition, reasonable wear and tear and
ordinary usage excepted, and maintain the inventories
at levels normally maintained.
10. Access to Premises and Information. At reasonable times prior to
the Closing Date, the Seller will provide the Purchaser and its representatives
with reasonable access during business hours to the assets, titles, contracts
and records of the Seller and furnish such additional information concerning the
Seller's business as the Purchaser from time to time may reasonably request.
11. Conditions and Best Efforts. The Seller will use its best efforts
to effectuate the transactions contemplated by this Agreement and to fulfill all
the conditions of the obligations of the Seller under this Agreement, and will
do all acts and things as may be required to carry out their respective
obligations under this Agreement and to consummate and complete this Agreement.
12. Covenants of Purchaser Prior to Closing.
12.1 Conditions and Best Efforts. The Purchaser will use its
best efforts to effectuate the transactions contemplated by this Agreement and
to fulfill all the conditions of the Purchaser's obligations under this
Agreement, and shall do all acts and things as may be required to carry out the
Purchaser's obligations and to consummate this Agreement.
12.2 Confidential Information. If for any reason the sale of
Assets is not closed, the Purchaser will not disclose to third parties any
confidential information received from the Seller in the course of
investigating, negotiating and performing the transactions contemplated by this
Agreement.
13. Seller's Representations and Warranties. The Seller represents and
warrants to the Purchaser as follows:
13.1 Corporate Existence. The Seller is now, and on the
Closing Date will be, a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, has all requisite corporate
power and authority to own its properties and assets and carry on its business
and is good standing in each jurisdiction in which such qualification is
required.
13.2 Corporation Power and Authorization. The Seller has full
corporate authority to execute and deliver this Agreement and any other
agreement to be executed and delivered by the Seller in connection herewith, and
to carry out the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate and shareholder action. No other
corporate proceedings by the Seller will be necessary to authorize this
Agreement or the carrying out of the transactions contemplated hereby. The
Seller has consulted its own financial advisor, tax advisor and accountant, as
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necessary or desirable, as to matters concerning this Agreement. This Agreement
constitutes a valid and binding Agreement of the Seller in accordance with its
terms.
13.3 Conflict with Other Agreements, Consents and Approvals.
With respect to (i) the articles of incorporation or bylaws of the Seller, (ii)
any applicable law, statute, rule or regulation, (iii) any contract to which the
Seller is a party or may be bound, or (iv) any judgment, order, injunction,
decree or ruling of any court or governmental authority to which the Seller is a
party or subject, the execution and delivery by the Seller of this Agreement and
any other agreement to be executed and delivered by the Seller in connection
herewith and the consummation of the transactions contemplated hereby will not
(a) result in any violation, conflict or default, or give to others any interest
or rights, including rights of termination, cancellation or acceleration, or (b)
require any authorization, consent, approval, exemption or other action by any
court or administrative or governmental body which has not been obtained, or any
notice to or filing with any court or administrative or governmental body which
has not been given or done.
13.4 Compliance with Law. The Seller's use and occupancy of
the Assets, wherever located, has been in compliance with all applicable
federal, state, local or other governmental laws or ordinances, the
non-compliance with which, or the violation of which, might have a material
adverse affect on the Assets, the Assumed Liabilities or the financial
condition, results of operations or anticipated business prospects of the
Purchaser, and the Seller has received no claim or notice of violation with
respect thereto. Without in any way limiting the generality of the foregoing,
the Seller is in compliance with, and is subject to no liabilities under, any
and all applicable laws, governmental rules, ordinances, regulations and orders
pertaining to the presence, management, release, discharge or disposal of toxic
or hazardous waste material or substances, pollutants (including conventional
pollutants) and contaminants. The Seller has obtained all material permits,
licenses, franchises and other authorizations necessary for the conduct of its
business.
13.5 Financial Statements. Attached hereto on Schedule 13.5
are the Seller's audited financial statements for the period ending September
30, 2001 (the "Financial Statements"). The Financial Statements are in
accordance with the books and records of the Seller and are true, correct and
complete; fairly present financial conditions of the Seller at the dates of such
Financial Statements and the results of its operations for the periods then
ended; and were prepared in accordance with generally accepted accounting
principles applied on a basis consistent with prior accounting periods. Except
as described in this Agreement, since February 6, 2002, there has been no
material adverse change in the financial condition of the Seller.
13.6 Tax and Other Returns and Reports. (i) All federal,
state, local and foreign tax returns and reports (including without limitation
all income tax, social security, payroll, unemployment compensation, sales and
use, excise, privilege, property, ad valorem, franchise, license and school)
required to be filed by the Seller by the Closing ("Tax Returns") have been
filed with the appropriate governmental agencies in all jurisdictions in which
such returns and reports are required to be filed, and all such returns and
reports properly reflect the taxes of the Seller for the periods covered
thereby; and (ii) all federal, state and local taxes, assessments, interest,
penalties, deficiencies, fees and other governmental charges or impositions,
including those enumerated above with respect to the Tax Returns, which are
called for by the Tax Returns, or which are claimed to be due from the Seller by
notice from any taxing authority, or upon or measured by its properties, assets
or income, have been properly accrued or paid by or at the Closing if then due
and payable.
13.7 Title to Assets. The Seller holds good and marketable
title to the Assets, free and clear of restrictions on or conditions to transfer
or assignment, and free and clear of liens, pledges, charges or encumbrances.
13.8 Intellectual Property Rights.
13.8.1 The Seller owns, possesses or has the right to use
all intellectual property rights necessary or
required to conduct its business as presently
conducted, or otherwise used by the Seller.
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13.8.2 No royalties or other amounts are payable by the
Seller to other persons by reason of the ownership or
the use of the any intellectual property owned or
used by the Seller.
13.8.3 (i) To the best knowledge of the Seller, no product
or service related to the Seller's business and
marketed and sold by the Seller violates any license
or infringes upon any intellectual property rights of
others, (ii) the Seller has not received any notice
that any such product or service conflicts with any
intellectual property rights of others, and (iii) to
the best knowledge of the Seller, there is no
reasonable basis to believe that any such violation,
infringement or conflict may exist.
13.8.4 The Seller is not a party to, or subject to, any
contract which currently requires, or upon the
passage of time or occurrence of an event or
contingency (whether of default or otherwise) will
require, the conveyance or disclosure of secret
processes or formulae related to, any intellectual
property of the Seller.
13.8.5 All computer hardware and software included among the
Assets and currently used and/or necessary to the
conduct of the Seller's business, are in good working
order.
13.8.6 Except as described in Schedule 1, the Seller has
obtained and delivered to the Purchaser all consents
and approvals of third parties necessary to duly
transfer to the Purchaser all of the Seller's rights,
title and interest in and to all of its intellectual
property included among the Assets.
13.9 Labor Agreements and Disputes. The Seller is neither a
party to, nor otherwise subject to any collective bargaining or other agreement
governing the wages, hours and terms of employment of the Seller's employees.
The Seller is not aware of any labor dispute or labor trouble involving
employees of the Seller nor has there been any such dispute or trouble during
the 5 months preceding the date of this Agreement.
13.10 ERISA and Related Matters. The Seller does not maintain
or contribute to any "Employee Welfare Benefit Plans" and "Employee Pension
Benefit Plans" (as defined in Section 3(1) and 3(2), respectively, of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) existing
on the date hereof. Except for its Reality Networks 2001 Stock Option Plan, the
Seller does not maintain any retirement or deferred compensation plan, savings,
incentive, stock option or stock purchase plan, unemployment compensation plan,
vacation pay, severance pay, bonus or benefit arrangement, insurance or
hospitalization program or any other fringe benefit arrangement for any
employee, consultant or agent of the Seller, whether pursuant to contract,
arrangement, custom or informal understanding, which does not constitute an
"Employee Benefit Plan" (as defined in Section 3(3) of ERISA), for which the
Seller may have any ongoing material liability after Closing. The Seller does
not maintain nor has it ever contributed to any Multiemployer Plan as defined by
Section 3(37) of ERISA. The Seller does not currently maintain any Employee
Pension Benefit Plan subject to Title IV of ERISA. There have been no
"prohibited transactions" (as described in Section 406 of ERISA or Section 4975
of the Code) with respect to any Employee Pension Benefit Plan or Employee
Welfare Benefit Plan maintained by the Seller as to which the Seller has been
party a party.
13.11 Government Contracts. The Seller has not entered into
any contract with the United States government or and agency, department,
instrumentality, prime contractor or higher-tier subcontractor thereof (a
"Government Contract"). The Seller is not a party to any Governments Contracts
that require access to classified information, and there are no security
clearances necessary for the operation of the Seller's business. To the best
knowledge of the Seller, there are no outstanding quotations, bids or proposals
submitted by the Seller to any agency, department or instrumentality of the
United States government or to a prime contractor or higher-tier subcontractor
thereof.
13.12 Litigation. The Seller has no knowledge of any claim,
litigation, proceeding or investigation pending or threatened against the Seller
that might result in any material adverse change in the business or condition of
the Assets being conveyed under this Agreement.
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13.13 Accuracy of Representations and Warranties. None of the
representations or warranties of the Seller contain or will contain any untrue
statement of a material fact or omit or will omit or misstate a material fact
necessary in order to make statements in this Agreement not misleading. The
Seller knows of no fact that has resulted in a material change in the business,
operations or assets of the Seller that has not been set forth in this Agreement
or otherwise disclosed to the Purchaser.
14. Representations of Purchaser. The Purchaser represents and warrants
as follows:
14.1 Corporate Existence. The Purchaser is now, and on the
Closing Date will be, a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada, has all requisite corporate
power and authority to enter into this Agreement and perform its obligations
hereunder.
14.2 Authorization. The Purchaser has full corporate authority
to execute and deliver this Agreement and any other agreement to be executed and
delivered by the Purchaser in connection herewith, and to carry out the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate and shareholder action. No other corporate
proceedings by the Purchaser will be necessary to authorize this Agreement or
the carrying out of the transactions contemplated hereby. This Agreement
constitutes a valid and binding Agreement of the Seller, in accordance with its
terms. The Purchaser has consulted its own financial advisor, tax advisor and
accountant, as necessary or desirable, as to matters concerning this Agreement.
14.3 Conflict with Other Agreements, Consents and Approvals.
With respect to (i) the articles of incorporation or bylaws of the Purchaser,
(ii) any applicable law, statute, rule or regulation, (iii) any contract to
which the Purchaser is a party or may be bound, or (iv) any judgment, order,
injunction, decree or ruling of any court or governmental authority to which the
Purchaser is a party or subject, the execution and delivery by the Purchaser of
this Agreement and any other agreement to be executed and delivered by the
Purchaser in connection herewith and the consummation of the transactions
contemplated hereby will not (a) result in any violation, conflict or default,
or give to others any interest or rights, including rights of termination,
cancellation or acceleration, or (b) require any authorization, consent,
approval, exemption or other action by any court or administrative or
governmental body which has not been obtained, or any notice to or filing with
any court or administrative or governmental body which has not been given or
done.
14.4 Employees. The Purchaser shall offer employment to all of
the Seller's employees and the Seller shall use its best efforts to assure the
orderly transfer of those employees to the Purchaser. All employees will
continue to receive the same compensation as they are receiving as of the date
of this Agreement, subject to such changes as the Purchaser may approve. The
Seller shall be responsible for payment of all compensation payable to all of
the Seller's employees who become employees of the Purchaser for the period
through and including the Closing Date and shall retain all liabilities and
obligations with respect to employees who are not transferred to the Purchaser.
Each of the Seller's employees who are transferred to the Purchaser shall
receive credit for the period such employee was employed at the Seller for
purposes of determining severance, family leave, disability and future vacation
after transfer to the Purchaser.
14.5 Accuracy of Representations and Warranties. None of the
representations or warranties of the Purchaser contain or will contain any
untrue statement of a material fact or omit or will omit or misstate a material
fact necessary in order to make the statements contained herein not misleading.
15. Conditions Precedent to Purchaser's Obligations. The obligation of
the Purchaser to purchase the Assets is subject to the fulfillment, prior to or
at the Closing Date, of each of the following conditions, any one or portion of
which may be waived in writing by the Purchaser:
15.1 Representations, Warranties and Covenants of Seller. The
representations and warranties of the Seller contained herein and any other
documents delivered by the Seller in connection with this Agreement shall be
true and correct in all material respects at the Closing; and the Seller shall
have performed all obligations and complied with all agreements, undertakings,
covenants and conditions required by this Agreement to be performed or complied
with by it or prior to the Closing.
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15.2 Licenses and Permits. The Purchaser shall have obtained
all licenses and permits from public authorities necessary to authorize the
ownership and operation of the business of the Seller.
15.3 Consents. The Purchaser shall have obtained the consent
of the lessor of Seller's lease agreement for the address of its executive
offices to the assignment of such agreement to the Purchaser.
15.4 Conditions of the Business. There shall have been no
material adverse change in the manner of operation of the Seller's business
prior to the Closing Date.
15.5 No Suits or Actions. At the Closing Date no suit, action
or other proceeding shall have been threatened or instituted to restrain, enjoin
or otherwise prevent the consummation of this Agreement or the contemplated
transactions.
16. Conditions Precedent to Obligations of the Seller. The obligations
of the Seller to consummate the transactions contemplated by this Agreement are
subject to the fulfillment, prior to or at the Closing Date, of each of the
following conditions, any one or a portion of which may be waived in writing by
the Seller;
16.1 Representations, Warranties and Covenants of Purchaser.
All representations and warranties made in this Agreement by the Purchaser shall
be true as of the Closing Date as fully as though such representations and
warranties had been made on and as of the Closing Date, and the Purchaser shall
not have violated or shall not have failed to perform in accordance with any
covenant contained in this Agreement.
17. Purchaser's Acceptance. The Purchaser represents and acknowledges
that it has entered into this Agreement on the basis of its own examination,
personal knowledge and opinion of the value of the business. The Purchaser has
not relied on any representations made by the Seller other than those specified
in this Agreement. The Purchaser further acknowledges the Seller has not made
any agreement or promise to repair or improve any of the leasehold improvements,
equipment or other personal property being sold to the Purchaser under this
Agreement, and that the Purchaser takes all such property in the condition
existing on the date of this Agreement, except as otherwise provided in this
Agreement.
18. Risk of Loss. The risk of loss, damage or destruction to any of the
equipment, inventory or other personal property to be conveyed to the Purchaser
under this Agreement shall be borne by the Seller to the time of Closing. In the
event of such loss, damage or destruction, the Seller, to the extent reasonable,
shall replace the lost property or repair or cause to repair the damaged
property to its condition prior to the damage. If replacement, repairs or
restorations are not completed prior to Closing, then the purchase price shall
be adjusted by an amount agreed upon by the Purchaser and the Seller that will
be required to complete the replacement, repair or restoration following
Closing. If the Purchaser and the Seller are unable to agree, then the
Purchaser, at its sole option and notwithstanding any other provision of this
Agreement, upon notice to the Seller, may rescind this Agreement and declare it
to be of no further force and effect, in which event there shall be no Closing
of this Agreement and all the terms and provisions of this Agreement shall be
deemed null and void. If, prior to Closing, any of the real properties that are
the subject of the leases to be assumed by the Purchaser are materially damaged
or destroyed, then the Purchaser may rescind this Agreement in the manner
provided above unless arrangements for repair satisfactory to all parties
involved are made prior to Closing.
19. Indemnification and Survival.
19.1 Survival of Representations and Warranties. All
representations and warranties made in this Agreement shall survive the Closing
of this Agreement, except that any party to whom a representation or warranty
has been made in this Agreement shall be deemed to have waived any
misrepresentation or breach of representation or warranty of which such party
had knowledge prior to Closing. Any party learning of a misrepresentation or
breach of representation or warranty under this Agreement shall immediately give
written notice thereof to all other parties to this Agreement. The
representations and warranties in this Agreement shall terminate 2 years from
the Closing Date, and such representations or warranties shall thereafter be
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without force or effect, except any claim with respect to which notice has been
given to the party to be charged prior to such expiration date.
19.2 Seller's Indemnification.
19.2.1 The Seller hereby agrees to indemnify and hold
the Purchaser, it successors and assigns harmless
from and against: (i) Any and all damages, losses,
claims, liabilities, deficiencies and obligations of
every kind and description, contingent or otherwise,
arising out of or related to the operation of the
Seller's business prior to the close of business on
the day before the Closing Date, except for damages,
losses, claims, liabilities, deficiencies and
obligations of the Seller expressly assumed by the
Purchaser under this Agreement or paid by insurance
maintained by the Seller or the Purchaser, (ii) any
and all damage or deficiency resulting from any
material misrepresentation, breach of warranty or
covenant, or nonfulfillment of any agreement on the
part of the Seller under this Agreement, and (iv) any
and all actions, suits, claims, proceedings,
investigation, audits, demands, assessments, fines,
judgments, costs and other expenses (including,
without limitation, reasonable audit and attorneys
fees) incident to any of the foregoing.
19.2.2 The Seller's indemnity obligations under Section 19.2
shall be subject to the following: (i) if any claim
is asserted against the Purchaser that would give
rise to a claim by the Purchaser against the Seller
for indemnification under the provisions of this
Section, then the Purchaser shall promptly give
written notice to the Seller concerning such claim
and the Seller shall, at no expense to the Purchaser,
defend the claim, and (ii) the Seller shall not be
required to indemnify the Purchaser for an amount
that exceeds the fair market value of the Purchase
Price paid by the Purchaser under this Agreement.
19.3 Purchaser's Indemnification. The Purchaser agrees to
defend, indemnify, and hold harmless the Seller from and against (i) any and all
claims, liabilities and obligations of every kind and description arising out of
or related to the operation of the business following Closing or arising out of
the Purchaser's failure to perform obligations of the Seller assumed by the
Purchaser pursuant to this Agreement; (ii) any and all damage or deficiency
resulting from any material misrepresentation, breach of warranty or covenant,
or nonfulfillment of any agreement on the part of the Purchaser under this
Agreement, and (iii) any and all actions, suits, claims, proceedings,
investigation, audits, demands, assessments, fines, judgments, costs and other
expenses (including, without limitation, reasonable audit and attorneys fees)
incident to any of the foregoing.
20. Miscellaneous Provisions.
20.1 Notices. All notices, requests, demands, claims, consents
and other communications required or permitted under this Agreement shall be in
writing. Any notice, request, demand, claim , communication or consent under
this Agreement shall be deemed duly given if (and shall be effective two
business days after) it is sent by certified mail, return receipt requested,
postage prepaid, and addressed to the intended recipient as set forth below:
If to Purchaser: Reality Wireless Networks, Inc.
0000 Xxxxxxxx Xxxx. XX, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
If to Seller: Reality Networks, Inc.
000 X. Xxxxxxxx Xxx., Xxxxx X
Xxxxxxxx, Xxxxxxxxxx 00000
or at any other address as any party may, from time to time, designate by notice
given in compliance with this section.
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20.2 Time. Time is of the essence of this Agreement.
20.3 Survival. Any of the terms and covenants contained in
this Agreement which require the performance of either party after the Closing
shall survive the Closing and delivery of the Assets.
20.4 Waiver. Failure of either party at any time to require
performance of any provision of this Agreement shall not limit the party's right
to enforce the provision, nor shall any waiver of any breach of any provision be
a waiver of any succeeding breach of any provision or a waiver of the provision
itself for any other provision.
20.5 Assignment. Except as otherwise provided within this
Agreement, neither party hereto may transfer or assign this Agreement without
the prior written consent of the other party.
20.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Washington, without giving
effect to the conflicts of law principals thereof.
20.7 Venue. This parties to this Agreement agree that any
action on this Agreement shall be brought in a court of competent jurisdiction
located in King County, Washington.
20.8 Arbitration. If at any time during the term of this
Agreement any dispute, difference or disagreement shall arise upon or in respect
of the Agreement, and the meaning and construction hereof, every such dispute,
difference and disagreement shall be referred to a single arbiter agreed upon by
the parties, or if no single arbiter can be agreed upon, an arbiter or arbiters
shall be selected in accordance with the rules of the American Arbitration
Association and such dispute, difference or disagreement shall be settled by
arbitration in accordance with the then prevailing commercial rules of the
American Arbitration Association, and judgment upon the award rendered by the
arbiter may be entered in any court having jurisdiction thereof.
20.9 Attorney Fees. In the event an arbitration, suit or
action is brought by any party under this Agreement to enforce any of its terms,
or in any appeal therefrom, it is agreed that the prevailing party shall be
entitled to reasonable attorneys' fees to be fixed by the arbitrator, trial
court and/or appellate court.
20.10 Titles and Captions. All article, section and paragraph
titles or captions contained in this Agreement are for convenience only and
shall not be deemed part of the context nor affect the interpretation of this
Agreement.
20.11 Entire Agreement. This Agreement contains the entire
understanding between and among the parties and supersedes any prior
understandings and agreements among them respecting the subject matter of this
Agreement.
20.12 Construction. The parties have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation.
20.13 Prior Agreements. This document is the entire, final and
complete agreement of the parties pertaining to the to purchase of the Assets,
and supersedes and replaces all prior or existing written and oral agreements
between the parties or their representatives relating to the Assets.
20.14 Modifications Must Be in Writing. This Agreement may not
be changed orally. All modifications of this Agreement must be in writing and
must be signed by each party.
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20.15 Agreement Binding. This Agreement shall be binding upon
the heirs, executors, administrators, successors and assigns of the parties
hereto.
20.16 Further Action. The parties hereto shall execute and
deliver all documents, provide all information and take or forbear from all such
action as may be necessary or appropriate to achieve the purposes of this
Agreement.
20.17 Good Faith, Cooperation and Due Diligence. The parties
hereto covenant, warrant and represent to each other good faith, complete
cooperation, due diligence and honesty in fact in the performance of all
obligations of the parties pursuant to this Agreement. All promises and
covenants are mutual and dependent.
20.18 Counterparts. This Agreement may be executed by
facsimile and in several counterparts, and all so executed shall constitute one
Agreement, binding on all the parties hereto even though all the parties are not
signatories to the original or the same counterpart.
20.19 Savings Clause. If any provision of this Agreement, or
the application of such provision to any person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such provision
to persons or circumstances other than those as to which it is held invalid,
shall not be affected thereby.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first written above.
SELLER:
REALITY NETWORKS, INC.
By: ________________________________________
Name: Xxxxxx Xxxxxx
Title: President and Chief Operating Officer
PURCHASER:
REALITY WIRELESS NETWORKS, INC.
By: ________________________________________
Name: Xxxx X. Xxxxxxxxxx
Title: Director and President, Secretary and
Treasurer
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