ASSET PURCHASE AGREEMENT
THIS AGREEMENT dated for reference the 30th day of December, 2000.
BETWEEN:
UNITY WIRELESS INTEGRATION CORPORATION
(the "Vendor")
AND:
LYMA SALES & MANAGEMENT CORP.
(the "Purchaser")
AND:
UNITY WIRELESS CORPORATION
("Unity")
WHEREAS:
A. The Vendor carries on a wireless integration business in the State of
Washington and elsewhere, and in connection therewith owns certain assets; and
B. The Vendor has agreed to sell and the Purchaser has agreed to purchase all
of the assets and undertaking of the Vendor's business, on the terms and subject
to the conditions hereinafter contained;
THIS AGREEMENT WITNESSES that in consideration of the premises and the mutual
promises of the parties, the parties agree as follows:
INTERPRETATION
1.1 DEFINITIONS
Where used in this Agreement each of the words and phrases set out in
Schedule "A" hereto shall have the meanings therein set forth.
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1.2 GOVERNING LAW
This Agreement shall in all respect be governed by and be construed in
accordance with the laws of the Province of British Columbia.
1.3 HEADINGS
The headings to the clauses of this Agreement are inserted for convenience
only and shall not affect the construction thereof.
1.4 ACCOUNTING TERMINOLOGY
All accounting terms not defined in this Agreement shall have those
meanings generally ascribed to them in accordance with generally accepted
accounting principles, applied consistently.
1.5 SCHEDULES
The following Schedules are incorporated by reference to this Agreement and
form a part hereof:
SCHEDULES
A - Definitions
1.6 CURRENCY
Unless specified otherwise, all statements of or references to dollar
amounts in this Agreement are to lawful money of Canada.
PURCHASE AND SALE
2.1 Upon the terms and subject to conditions of this Agreement and based on the
warranties and representations herein contained, the Vendor agrees to sell and
the Purchaser agrees to purchase the Assets as and from the Effective Date.
2.2 Following the closing of this transaction, Unity agrees to sell and the
Purchaser agrees to purchase all the issued and outstanding shares in the
capital of the Vendor pursuant to a separate Share Purchase Agreement, for a
purchase price of one dollar.
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PURCHASE PRICE
3.1 The Purchase Price is $92,000.
PAYMENT OF PURCHASE PRICE
4.1 The Purchaser shall pay the Purchase Price as follows:
(a) within one year of Closing, by the payment to Vendor of $92,000, in
equal semi-annual amounts of $46,000, with interest on the unpaid
balance at a rate equivalent to Prime Rate per annum.
4.2 The Vendor assigns all sale proceeds to Unity in repayment of intercompany
loans and authorizes and instructs the Purchaser to make all cheques for
sales proceeds payable to Unity.
REPRESENTATIONS AND WARRANTIES OF UNITY AND THE VENDOR
5.1 Unity and the Vendor represent and warrant that:
(a) the Vendor is a corporation duly incorporated under the laws of the
State of Washington and is in good standing under the laws thereof;
and has the power, authority and capacity to own and dispose of the
Assets and to enter into this Agreement and carry out the transactions
contemplated hereby;
(b) the execution and delivery of this Agreement and the completion of the
transactions contemplated hereby has been duly and validly authorized
by all necessary corporate action on the part of the Vendor, and this
Agreement constitutes a legal, valid and binding obligation of the
Vendor enforceable against the Vendor in accordance with its terms
except as may be limited by laws of general application affecting the
rights of creditors;
(c) the Vendor has good and marketable title to the Assets free and clear
of all liens, mortgages, encumbrances, charges, pledges, security
interests, equities, executions, or claims of every kind and nature
whatsoever and none of the Assets is in the possession of or under the
control of any other person;
(d) there is no written or oral agreement, option, understanding or
commitment or any right or privilege capable of becoming an agreement,
for the purchase from the Vendor of the Business or any of the Assets.
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(e) there are no amounts owing by UW Singapore to Unity or any of its
related companies.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
6.1 The Purchaser represents and warrants as follows:
(a) the Purchaser is a corporation duly incorporated under the laws of
British Columbia, is validly existing and is in good standing with
respect to the filing of its annual returns, and has the power,
authority and capacity to enter into this Agreement and to carry out
the transactions contemplated hereby;
(b) the execution and delivery of this Agreement and the completion of the
transactions contemplated hereby, have been duly and validly
authorized by all necessary corporate action on the part of the
Purchaser and this Agreement constitutes a legal, valid and binding
obligation of the Purchaser enforceable against the Purchaser in
accordance with its terms except as limited by laws of general
application affecting the rights of creditors; and
(c) neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will result in
the breach by the Purchaser of any term, provisions or condition of,
or constitute a default by the Purchaser under, the Memorandum or
Articles of the Purchaser, or any indenture, mortgage, deed of trust,
agreement, lease, franchise, certificate, consent, permit, licence,
authority or other instrument to which the Purchaser is a party or by
which it is bound or any judgment, decree, order, rule or regulation
of any court or administrative body by which the Purchaser is bound,
or any statute or regulation applicable to the Purchaser.
COVENANTS OF THE PARTIES
7.1 Unity will grant to UW Singapore a non-exclusive non-assignable license to
use the unregistered trade xxxx "Unity Wireless" in Singapore and only in
respect of integration services. Unity will also grant to UW Singapore a
non-exclusive non-assignable license to use the unregistered trade xxxx "UW-I"
in Singapore and only in respect of integration services.
7.2 Within ten Business Days of Closing, the Purchaser will repay the Lyma
Promissory Note in the amount of $54,000 and deliver the written consent of
Orbital TMS to the assignment of the Orbital contract from the Vendor to the
Purchaser included in the within sale of assets.
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7.3 No Party will issue or approve a news release or other announcement
concerning the within transaction without the prior written approval of the
other Parties as to the contents of the announcement, which approval will not be
unreasonably withheld.
7.4 For a period of one year from closing and upon reasonable advance notice,
Purchaser may use the boardroom in the Burnaby business premises of Unity,
subject to availability.
SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 All representations, warranties, covenants and agreements made by Unity and
the Vendor in this Agreement or pursuant thereto shall, unless otherwise
expressly stated, survive the Closing Date, the payment of the Purchase Price
and any investigation at any time made by or on behalf of the Purchaser and
shall continue in full force and effect for the benefit of the Purchaser.
8.2 All representations, warranties, covenants and agreements made by the
Purchaser in this Agreement or pursuant hereto shall, unless otherwise expressly
stated, survive the Closing Date, the payment of the Purchase Price and any
investigation at any time made by or on behalf of the Vendor and shall continue
in full force and effect for the benefit of the Vendor.
CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS
9.1 Notwithstanding anything herein contained, the obligation of the Purchaser
to complete the purchase hereunder is subject to the following conditions:
(a) the representations and warranties of Unity and the Vendor contained
in this Agreement shall be true at and as of the Closing Date as
though such representations and warranties were made as of such time;
(b) the Vendor shall have performed and complied with all covenants,
agreements and conditions required by this Agreement to be performed
or complied with by it at or prior to the Closing Date.
9.2 The foregoing conditions are for the exclusive benefit of the Purchaser and
such conditions may be waived in whole or in part by the Purchaser on or prior
to the Closing Date by delivery to the Vendor of a written waiver to that
effect, signed by the Purchaser.
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CONDITIONS PRECEDENT TO THE VENDOR'S OBLIGATIONS
10.1 Notwithstanding anything herein contained, the obligation of the Vendor to
complete the sale hereunder is subject to the following conditions:
(a) the representations and warranties of the Purchaser contained in this
Agreement shall be true at and as of the Closing Date as though such
representations and warranties were made as of such time;
(b) the Purchaser shall have performed and complied with all covenants,
agreements and conditions required by this Agreement to be performed
or complied with by it at or prior to the Closing Date.
10.2 The foregoing conditions are for the exclusive benefit of the Vendor and
may be waived in whole or in part by the Vendor at or prior to the Closing Date
by delivering to the Purchaser a written waiver to that effect, signed by the
Vendor.
VENDOR'S DELIVERIES
11.1 At the Closing the Vendor shall deliver or cause to be delivered to the
Purchaser:
(a) a certified copy of a resolution of the Shareholders of the Vendor
duly passed authorizing the sale of all or substantially all of the
assets of the Vendor.
PURCHASER'S DELIVERIES
12.1 At the Closing the Purchaser shall deliver or cause to be delivered:
(a) a fully executed copy of the Share Purchase Agreement;
(b) executed Lyma Promissory Note;
(c) fully executed copy of this Agreement.
12.2 Within ten Business Days of the Closing, the Purchaser shall deliver the
following:
(a) certified cheque payable to or to the order UW Systems in the amount
of $54,000, representing repayment of the UW Systems loan to Lyma; and
(b) executed consulting agreements for Xxx Xxxxxxx and Gan Xxxxxx Xxxxx.
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ESCROW PROVISIONS
13.1 The Vendor's Solicitor will hold in escrow and undelivered the closing
documents set forth in ss. 11.1 and 12.1, pending delivery of the balance of the
deliverables referred to in this Agreement.
13.2 In the event of a material breach of the Share Purchase Agreement or s.
12.2 of this Agreement, the within transaction of purchase and sale shall be
null and void and the Vendor's Solicitor shall return all Closing and other
documents in his possession.
CLOSING
14.1 Subject to the terms and conditions hereof, the purchase and sale of the
Assets shall be completed in Vancouver on the Closing Date.
14.2 Closing shall take place at the offices of Unity Wireless Corporation in
Burnaby, B.C.
EFFECTIVE DATE
15.1 Notwithstanding the actual date of execution and delivery of this
Agreement, the purchase and sale of Assets herein contemplated shall take effect
as of and from the Effective Date.
15.2 Except where otherwise specified in this Agreement, all accounts payable
and accounts receivable in connection with the Business conducted prior to the
Effective Date shall be for the account of the Vendor and all transactions in
the Business on or after the Effective Date shall be for the account of the
Purchaser.
CONVEYANCE
16.1 On completion of the Closing, this Agreement shall, without further act or
formality, operate as a transfer to the Purchaser of all Assets to be sold and
purchased hereunder as the same shall be at the close of business on the
Effective Date. The Vendor shall nevertheless at the Closing and from time to
time after the Closing execute and deliver to the Purchaser all such
conveyances, transfers, assignments and other instruments in writing and further
assurances as the Purchaser or its counsel shall reasonably require from the
Vendor, and the Purchaser shall execute and deliver to the Vendor all such
agreements of assumptions and other instruments in writing and further
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assurances as the Vendor or its counsel shall reasonably require in order to
give effect to the provisions of this Agreement.
GENERAL PROVISIONS
17.1 Time shall be of the essence of this Agreement.
17.2 The parties shall execute such further and other documents and do such
further and other things as may be necessary to carry out and give effect to the
intent of this Agreement.
17.3 This Agreement contains the whole agreement between the Vendor and the
Purchaser in respect of the purchase and sale contemplated hereby and there are
no warranties, representations, terms, conditions or collateral agreements,
express, implied or statutory, other than expressly set forth in this Agreement.
17.4 This Agreement shall enure to the benefit of and be binding upon the
parties, and, as applicable, their successors and assigns, and any reference
herein to the Vendor or the Purchaser shall include, as applicable, their
successors and assigns.
17.5 If the event of any dispute arising in any accounting or adjustment
provided for in this Agreement, the matter is dispute shall be referred in the
first instance to the accountants of the Purchaser and the Vendor for
determination. If the accountants cannot agree on a determination of the matter
in dispute within 10 days next after the reference to them, the matter in
dispute shall be referred to a single arbitrator under the COMMERCIAL
ARBITRATION ACT then in effect in British Columbia.
17.6 Any notice to be given under this Agreement shall be duly and properly
given if delivered or if mailed by prepaid registered post in British Columbia
addressed as follows and any such notice shall be deemed to be received upon
delivery or forty-eight (48) hours after the hour of mailing:
To the Vendor: Unity Wireless Integration Corporation
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxx, X.X. X0X 0X0
To Unity: Unity Wireless Corporation
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxx, X.X. X0X 0X0
To the Purchaser: Lyma Sales & Management Corp.
c/o Xxxxxxx Xxxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxx Xxxxxxxxx, X.X. X0X 0X0
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or to such other address as any party hereto may from time to time designate by
notice in writing to the others.
THE PARTIES INTENDING TO BE LEGALLY BOUND have executed this Agreement as of the
date first set forth above.
UNITY WIRELESS INTEGRATION CORPORATION
/s/ Xxxxxxx Xxxxxxx
-----------------------------------
Authorized Signatory
UNITY WIRELESS CORPORATION
/s/ Xxxxxx Xxxxxxxxx
-----------------------------------
Authorized Signatory
LYMA SALES & MANAGEMENT CORP.
/s/ Xxxxxxx Xxxxxxx
-----------------------------------
Authorized Signatory
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SCHEDULE A
DEFINITIONS
Wherever any of the following expressions are used in this Agreement:
1. "Assets" means the following assets used in the Business:
(a) all tangible property;
(b) all intangible property, including all the interest of the Vendor in
the contract between the Vendor and Orbital TMS dated March 26, 2000
and the shareholding interest of the Vendor in Unity Wireless
Integration (S) Pte Ltd., a Singapore company.
2. "Business" means the business currently and heretofore carried on by the
Vendor for the integration of wireless services.
3. "Closing" means the completion of the sale and purchase of the Assets
hereunder by the transfer and conveyance thereof and the payment of or
provision for the Purchase Price, all as provided herein.
4. "Closing Date" means Friday, December 29, 2000 or such other date as shall
be agreed upon by the parties hereto.
5. "Effective Date" means December 30, 2000.
6. "Lyma Promissory Note" means the $54,000 demand promissory note from Lyma
as borrower, in favour of UW Systems as lender, and dated July 1, 2000.
7. "Orbital Contract" means the contract between the Vendor and Orbital TMS
dated March 26, 2000.
8. "Orbital TMS" means Orbital Sciences Corporation, TMS Division.
9. "Prime Rate" means the prime rate of HSBC Canada from time to time.
10. "Purchase Price" shall mean the purchase price for the Assets as set forth
in Section 3.1.
11. "Share Purchase Agreement" means the Share Purchase Agreement among the
Purchaser, the Vendor and Unity dated December 31, 2000;
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12. "UW Singapore" means Unity Wireless Integration (S) Pte Ltd., a Singapore
company.
13. "UW Systems" means Unity Wireless Systems Corporation, a British Columbia
company.
14. "Vendor's Solicitor" means Xxxxxxx Stunden, general counsel for the Vendor.
