Exhibit 10.6
ASSET PURCHASE AGREEMENT
BY AND AMONG
CREATIVE MARKETING ASSOCIATES, INC.
VoIP, INC.,
and
eGLOBALPHONE, INC.
February 23, 2005
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS.........................................................1
1.1 Certain Definitions.................................................1
1.2 Other Definitional Provisions.......................................2
ARTICLE II. PURCHASE AND SALE..................................................2
2.1 Purchase Price......................................................2
2.2 Transfer of Assets..................................................2
ARTICLE III. CLOSING...........................................................3
3.1 Closing.............................................................3
3.2 Closing Deliveries..................................................3
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER...........................3
4.1 Organization; Capitalization........................................3
4.2 Authorization.......................................................3
4.3 No Conflict or Violation; Default...................................3
4.4 Consents............................................................3
4.5 Assets..............................................................4
4.6 Solvency; Fair Value................................................4
4.7 Litigation..........................................................4
4.8 Tax Matters.........................................................4
4.9 Intellectual Property...............................................4
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER.............................4
5.1 Organization........................................................4
5.2 Authorization.......................................................5
5.3 No Conflict or Violation; Default...................................5
5.4 Consents............................................................5
ARTICLE VI. INDEMNIFICATION....................................................5
6.1 Settlement of Disputes..............................................5
ARTICLE VII. MISCELLANEOUS.....................................................6
7.1 Expenses............................................................6
7.2 Notices.............................................................6
7.3 Counterparts........................................................6
7.4 Entire Agreement....................................................7
7.5 Headings............................................................7
7.6 Assignment; Amendment of Agreement..................................7
7.7 Non Waiver..........................................................7
7.8 Severability........................................................7
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ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement"), dated as of February
23, 2005, is entered into by and among Creative Marketing Associates, Inc., a
Missouri corporation ("Seller"), VoIP, INC., a Texas corporation ("VOIP"), and
eGLOBALPHONE, INC., a Florida corporation ("Buyer").
RECITALS
WHEREAS, Seller currently owns Customer of Record rights in certain
telephone numbers, URL's and trademark listed below (ARTICLE I) useful for the
marketing of voice-over-internet telephone connectivity (the "Assets");
WHEREAS, Seller desires to sell substantially all of Seller's Assets,
including all rights and interests associated therewith to Buyer; and
WHEREAS, VOIP and Buyer desire to purchase from Seller, upon the terms
and conditions set forth herein, such Assets, rights and interests;
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein, the parties hereby agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Certain Definitions. The following terms have the following
meanings when used herein:
(a) "Assets" includes the following assets of Seller, all rights and
interests associated therewith, and, without limiting the generality of the
foregoing, shall expressly include the following assets, rights and interests of
Seller:
(i) all rights of the Customer of Record in the telephone
numbers 0 (000) XXXXXXXX, 0 (000) XXXXXXXX and 0 (000) XXXXXXXX;
(ii) all rights to the URL's (domain names) 000XXXXXXXX.XXX,
0000XXXXXXXX.XXX, and 0-000-XXXXXXXX.XXX;
(iii) all rights to U.S. Trademark Registration No. 2,209,316
directed to the xxxx 1-800-TALKTIME and the goodwill associated
therewith;
(iv) any and all business plans, financial projections, and
similar information pertaining to the Assets;
(v) any and all other intellectual property pertaining to the
Assets, including trademarks, service marks, proprietary rights in
trade names, brand names, internet domain names, trade dress, labels,
logos, slogans and other indications of origin, and copyrighted works
(including any registrations or applications for registration of the
foregoing in any jurisdiction and any extensions, modifications or
renewals thereof) (the "Intellectual Property");
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(vi) except as otherwise provided herein, any and all customer
and supplier lists pertaining to the Assets (including principal
contacts, addresses and telephone numbers, purchasing history, payment
information and any other documented information) and other business
files and information;
(vii) except as otherwise provided herein, all rights,
benefits and interests in and to any and all licenses, leases,
contracts, agreements, commitments and undertakings pertaining to the
Assets; and
(viii) all goodwill of Seller pertaining to the Assets.
(b) Other capitalized terms included in this Agreement shall have the
meaning ascribed to herein.
1.2 Other Definitional Provisions. The language in all parts of this
Agreement shall be construed, in all cases, according to its fair meaning.
(a) Terms defined in the singular shall have a comparable meaning when
used in the plural, and vice versa.
ARTICLE II.
PURCHASE AND SALE
2.1 Purchase Price. Upon the terms and subject to the conditions set
forth herein, Buyer shall, and hereby does, purchase from Seller the Assets for
an aggregate purchase price consisting of the following: (the "Purchase Price"):
a) Cash in the amount of $50,000, was paid on December 13, 2004.
b) Cash in the amount of $50,000, was paid on January 12, 2005.
c) Cash in the amount of $100,000, to be paid on or before April
1, 2005.
d) Warrants, which will be fully tradable no later than August 1,
2005, to purchase 400,000 shares of the Common Stock of VOIP
at one dollar and seventy cents ($1.70) per share, pursuant to
the Warrant Agreement attached as Exhibit A.
e) 100,000 shares of restricted VOIP Common Stock Issued December
30, 2004, said restrictions to be removed so that said shares
are fully tradable no later than August 1, 2005.
2.2 Transfer of Assets. Upon the terms and subject to the conditions
set forth herein, Seller shall, and hereby does, sell and transfer to Buyer all
right, title and interest of Seller in and to the Assets, free and clear of all
encumbrances of any kind known to Seller.
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ARTICLE III.
CLOSING
3.1 Closing. The closing of the transactions contemplated herein (the
"Closing") is occurring on the date hereof (the "Closing Date") and shall be
deemed effective upon the execution and delivery of this Agreement.
3.2 Closing Deliveries. To effect the sale and transfer of the Assets
referred to in Section 2.2 hereof, the parties shall, and hereby do, execute and
deliver, or have delivered, to each other all documents reasonably necessary to
effect the Closing, except the assignment of said Registration No. 2,209,316
which may be retained by Seller until payment of cash in the amount of $100,000
is received by Seller in accordance with Section 2.1(c) herein.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer and VOIP as follows:
4.1 Organization; Capitalization.
(a) Seller is a Missouri corporation duly organized, validly existing
and in good standing under the laws of the State of Missouri and has all
requisite power and authority to own or lease the properties used in its
business and to carry on such business as presently conducted.
(b) Seller is duly qualified to do business and is in good standing as
a foreign limited liability company in each jurisdiction in which the ownership
of the Assets requires such qualification.
4.2 Authorization. This Agreement has been duly authorized, executed
and delivered by Seller, and this Agreement is the legal, valid and binding
obligation of Seller enforceable against it.
4.3 No Conflict or Violation; Default. Neither the execution and
delivery of this Agreement nor the consummation of the transactions contemplated
hereby or thereby will violate, conflict with or result in a breach of or
constitute a default under or result in the termination or the acceleration of,
or the creation in any party of any right (whether or not with notice or lapse
of time or both) to declare a default, accelerate, terminate, modify or cancel
(a) any indenture, contract, lease, sublease, loan agreement, note or other
obligation or liability to which Seller is a party or by which it is bound, (b)
any provision of the articles of organization or regulations or articles of
incorporation or bylaws (or similar organizational or governing documents) of
Seller, (c) any judgment, order, decree, rule or regulation of any court or
governmental agency to which Seller or the Business is subject or (d) any
applicable laws or regulations.
4.4 Consents. No notice to or consent, approval, authorization, order,
filing, registration or qualification of or with any court, governmental
authority or third party is required to be made or obtained by Seller in
connection with the execution and delivery of this Agreement or the consummation
by Seller of the transactions contemplated herein and therein.
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4.5 Assets. Seller has or will transfer to Buyer, good, valid and
marketable title to the Assets, free and clear of any claims, security
interests, liens, pledges, charges, escrows, options, proxies, rights of first
refusal, prior assignments remaining in effect, indentures or any other
encumbrances of any kind known to Seller, including licenses of intellectual
property. The delivery to Buyer of the instruments of transfer contemplated
hereby will vest, indefeasible and exclusive title to the Assets in Buyer, free
and clear of all encumbrances of any kind known to Seller.
4.6 Solvency; Fair Value. Seller is solvent. The consummation of the
transactions contemplated hereby will not affect Seller's solvency subsequent to
the Closing Date. Seller hereby acknowledges that the Purchase Price received
pursuant to this Agreement constitutes reasonably equivalent value for the
Assets that Buyer is acquiring pursuant hereto.
4.7 Litigation. There is no claim, action, suit, proceeding, or
investigation pending or threatened against Seller or its respective directors,
officers, agents or employees (in their capacity as such) pertaining to the
Assets or any properties or rights associated with the Assets or that is
reasonably likely to adversely affect the Assets or the transactions
contemplated hereby. There are no orders, writs, injunctions or decrees
currently in force against Seller or its respective directors, officers, agents
or employees (in their capacity as such) pertaining to the Assets.
4.8 Tax Matters Seller has duly and timely filed, or caused to be duly
and timely filed all Tax Returns required to be filed by it with the appropriate
governmental authorities, or requests for extensions to file such Tax Returns
have been timely filed and granted and have not expired. All such Tax Returns
were at the time of filing and are as of the date hereof true, correct and
complete in all respects. All Taxes owed by Seller relating to the Assets
(whether or not shown on any Tax Return) have been paid within the time and in
the manner prescribed by law. All deficiencies for any Taxes relating to
Seller's Assets that have been proposed, asserted or assessed against Seller
have been fully paid.
4.9 Intellectual Property. Article I sets forth a true, correct and
complete list and description of all registered Intellectual Property and
applications therefor owned by Seller pertaining to the Assets (the "Seller
Intellectual Property"). The Seller Intellectual Property constitutes all
intellectual property of Seller pertaining to the Assets. Seller is the sole
owner of the Seller Intellectual Property, free and clear of any payment,
restriction or known encumbrance. No claims have been asserted by any person or
entity that challenge Seller's exclusive rights in the Seller Intellectual
Property. To Seller's knowledge, the Seller Intellectual Property does not
infringe on, misappropriate, or otherwise violate a valid and enforceable
intellectual property right of any other person or entity.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer and VOIP, INC. represent and warrant to Seller as follows:
5.1 Organization. Buyer and VOIP are corporations duly organized,
validly existing and in good standing respectively under the laws of the States
of Florida and Texas and have all requisite power and authority to enter into
this Agreement.
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5.2 Authorization. This Agreement has been duly authorized, executed and
delivered by Buyer, and this Agreement is the legal, valid and binding
obligation of Buyer and VOIP, enforceable against Buyer and VOIP in accordance
with their respective terms.
5.3 No Conflict or Violation; Default. Neither the execution and
delivery of this Agreement nor the consummation of the transactions contemplated
hereby or thereby will violate, conflict with or result in a breach of or
constitute a default under (a) any provision of the articles of incorporation or
bylaws of Buyer or VOIP, (b) any judgment, order, decree, rule or regulation of
any court or governmental agency to which Buyer or VOIP or Buyer's business or
VOIP's business is subject or (c) any applicable laws or regulations.
5.4 Consents No notice to or consent, approval, authorization, order,
filing, registration or qualification of or with any court, governmental
authority or third party is required to be made or obtained by Buyer or VOIP in
connection with the execution and delivery of this Agreement or the consummation
by Buyer or VOIP of the transactions contemplated herein and therein.
ARTICLE VI.
INDEMNIFICATION
6.1 Settlement of Disputes. (a) Arbitration. All disputes with respect
to any claim for indemnification under this Article VII and all other disputes
and controversies of every kind and nature between the parties hereto arising
out of or in connection with this Agreement shall be submitted to arbitration
pursuant to the following procedures:
(i) After a dispute or controversy arises, either party may,
in a written notice delivered to the other party, demand such
arbitration. Such notice shall include a statement of the matter in
controversy;
(ii) Within 30 days after receipt of such demand, an
arbitrator shall be chosen by the American Arbitration Association
("AAA").
(iii) The arbitration hearing shall be held within 30 days of
appointment of the arbitrator in Kansas City, Missouri, at a location
designated by the arbitrator. The Commercial Arbitration Rules of the
AAA shall be used and the substantive laws of the State of Missouri
(excluding conflict of laws provisions) shall apply;
(iv) An award rendered by the arbitrator appointed pursuant to
this Agreement shall be final and binding on all parties to the
proceeding, shall deal with the question of costs of the arbitration
and all related matters, shall not award punitive damages, and judgment
on such award may be entered by either party in a court of competent
Jurisdiction; and
(v) Except as set forth in subsection (b) below, the parties
stipulate that the provisions of this Section 6.1 shall be a complete
defense to any suit, action or proceeding instituted in any federal,
state, or local court or before any administrative tribunal with
respect to any controversy or dispute arising out of this Agreement.
The arbitration provisions hereof shall, with respect to such
controversy or dispute, survive the termination or expiration of this
Agreement.
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(b) Emergency Relief. Notwithstanding anything in this Section 6.1 to
the contrary, either party may seek emergency relief from a court for any remedy
that may be necessary to protect any rights or property of such party pending
the establishment of the arbitral tribunal or its determination of the merits of
the controversy.
ARTICLE VII.
MISCELLANEOUS
7.1 Expenses. Buyer shall pay all costs and expenses incurred by it on
its behalf, and Seller shall pay all costs and expenses incurred by Seller or on
its behalf, in connection with this Agreement and the transactions contemplated
hereby, including fees and expenses of their financial consultants, accountants
and legal counsel.
7.2 Notices. All notices, requests, demands and other communications
given hereunder (collectively, "Notices") shall be in writing and delivered
personally or by overnight courier to the parties at the following addresses or
sent by telecopier or telex, with confirmation received, to the telecopy
specified below:
If to Seller:
Xxxxxxx Small
Creative Marketing Associates, Inc.
0000 Xxxxxxxx - Xxxxx 000
Xxxxxx Xxxx, Xxxxxxxx 00000
Telecopy No: 816.753.2270
Telephone No: 000-000-0000
If to Buyer or VOIP:
Xxxxxx Xxxxxxx
VoIP, Inc.
00000 X.X. 00xx Xxxxxx
Xxxxx 000
Xx. Xxxxxxxxxx, XX 00000
Telecopy No.: 954.434-2877
Telephone No.: 954.434-2000
All Notices shall be deemed delivered when actually received if
delivered personally or by overnight courier, sent by telecopier or telex
(promptly confirmed in writing), addressed as set forth above. Each of the
parties shall hereafter notify the other in accordance with this Section 8.2 of
any change of address or telecopy number to which notice is required to be
mailed.
7.3 Counterparts. This Agreement may be executed simultaneously in one
or more counterparts, and by different parties hereto in separate counterparts,
each of which when executed shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
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7.4 Entire Agreement. This Agreement constitutes the entire agreement
of the parties with respect to the subject matter hereof and supersede all prior
negotiations, agreements and understandings, whether written or oral, of the
parties.
7.5 Headings. The headings contained in this Agreement and in the
Schedules and Exhibits hereto are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.
7.6 Assignment; Amendment of Agreement. This Agreement shall be binding
upon the respective successors and assigns of the parties hereto. This Agreement
may not be assigned by any party hereto without the prior written consent of the
other party hereto which consent shall not be unreasonably withheld. This
Agreement may be amended only by written agreement of the parties hereto, duly
executed and delivered by an authorized representative of each of the parties
hereto.
7.7 Non Waiver. The failure in any one or more instances of a party
hereto to insist upon performance of any of the terms, covenants or conditions
of this Agreement, to exercise any right or privilege in this Agreement
conferred, or the waiver by said party of any breach of any of the terms,
covenants or conditions of this Agreement shall not be construed as a subsequent
waiver of any such terms, covenants, conditions, rights or privileges, but the
same shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.
7.8 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to affect the original intent of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the extent possible.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement as of the day and year first above written.
CREATIVE MARKETING ASSOCIATES
By: /s/ Xxxxxxx Small
--------------------------
Xxxxxxx Small, President
VoIP, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------
Xxxxxx Xxxxxxx, President
eGLOBALPHONE, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------
Xxxxxx Xxxxxxx, President
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