ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (the "Agreement") is entered into
effective this 4th day of January, 1999 by and between Infotainment
Telepictures, Inc., a Nevada corporation ("Seller"), and Digital Xxxxxxxxxxx.xxx
Inc., a Delaware corporation ("Buyer").
WITNESSETH:
WHEREAS, Seller owns all rights to produce that certain television show
commonly known as "Net Talk Live!" (the "Business"); and
WHEREAS, the parties hereto desire to enter into this Agreement for the
purchase of the Business and all assets associated therewith; and
NOW, THEREFORE, for and in consideration of the mutual understandings,
promises and covenants contained herein (including the recitals set forth
above), the parties hereto agree as follows:
I. TERMS OF PURCHASE AND SALE; CLOSING.
1.1 PURCHASE AND SALE OF CERTAIN ASSETS OF SELLER.
(i) Upon the basis of the representations and warranties and
subject to the terms and conditions of this Agreement, Buyer agrees to
purchase and acquire from Seller, and Seller agrees to sell, convey,
transfer, assign, and deliver to Buyer, on or before the Closing Date
(as defined in Section 1.6 hereof) the Assets, free and clear of any
pledge, lien, claim or other encumbrance of any kind whatsoever,
against receipt on the Closing Date and thereafter of the Purchase
Price as specified in Section 1.3 hereof.
(ii) The term "Assets" shall mean:
(i) all of Seller's right, title and interest in
and to the trade names, trade marks, designs
and other Intellectual Property described on
Schedule I hereto;
(ii) all of Seller's right, title and interest in
and to the furniture, fixtures and equipment
("FF&E") listed on Schedule II hereto; and
(iii) all related goodwill with regard to any of
the foregoing.
(iii) It is the intention of the Buyer and Seller to convey
all assets relating to the Business whether or not specifically
designated herein.
1.2 EXCLUDED ASSETS. Buyer shall not purchase from Seller, and Seller
shall not sell to Buyer, any assets which are not described on Section 1.1 (the
"Excluded Assets").
1.3 PURCHASE PRICE. The aggregate purchase price (the "Purchase Price")
for the Assets shall be Eight Million dollars ($8,000,000) and shall be paid on
the Closing Date by Buyer's execution and delivery of Buyer's promissory note
(the "Promissory Note") in the original principal amount of Eight Million
dollars ($8,000,000), bearing interest at the rate of six percentage (6 %) per
annum and being in the form attached hereto as EXHIBIT "A" .
1.4 LIABILITIES ASSUMED. Buyer agrees to assume those liabilities set
forth on Schedule III to this Agreement. Except for those liabilities expressly
assumed, Buyer does not assume any obligation or liability of Seller.
1.5 INSTRUMENTS OF TRANSFER AND CONVEYANCE.
(i) The sale, conveyance, transfer, assignment and delivery of
the Assets, as herein provided, shall be effected by delivery by Seller
on the Closing Date of hereto (i) an assignment of Intellectual
Property in substantially the form attached hereto as EXHIBIT "B", (ii)
a Xxxx of Sale in substantially the form attached hereto as EXHIBIT
"C", and (iii) any such other bills of sale, endorsements, assignments,
certificates, drafts, checks or other instruments of transfer and
conveyance as Buyer shall reasonably deem necessary to vest in Buyer
good and marketable title to the Assets. Such instruments of transfer
and conveyance shall contain warranties as to marketable title and that
such Assets are free and clear of all pledges, liens, options, security
interests, mortgages, claims, charges or other encumbrances of any kind
whatsoever.
(ii) Seller agrees that it will from time to time after the
Closing Date, upon the request of Buyer, promptly do, execute,
acknowledge and deliver, and will cause to be done, executed,
acknowledged and delivered, all such further instruments, certificates,
assignments, transfers, conveyances, powers of attorney, assurances and
other documents, as may be reasonably necessary or advisable to assure
or confirm Buyer's free and clear title to and interest in, or to
enable Buyer to deal with and dispose of, any of the Assets.
1.6 CLOSING. The closing hereunder (the "Closing") shall be held at the
offices of Kane, Russell, Xxxxxxx & Xxxxx, P.C., 3700 Thanksgiving Tower, 0000
Xxx Xxxxxx, Xxxxxx, Xxxxx 00000 as of the effective date of this Agreement, or
at such other time and place as the parties may agree upon (the "Closing Date").
At the Closing: (a) Seller will execute and deliver to Buyer the instruments of
transfer and conveyance as are required pursuant to Section 1.5 above; (b) Buyer
will execute and deliver to Seller an Assumption of Liabilities relating to any
liabilities set forth in Section 1.4 above; and (c) each party will execute and
deliver to the others such other agreements, certificates, assignments, consents
and other documents as are required or specified in this Agreement or as may
reasonably be requested by the other party to evidence compliance with the terms
hereof. Simultaneously with the deliveries contemplated herein, Seller will use
its best efforts
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and take all such other action as may be reasonably necessary to put Buyer in
possession and control of the Assets.
II. REPRESENTATIONS AND WARRANTIES OF SELLER.
Seller represents and warrants to Buyer as follows:
2.1 CORPORATE STATUS. Seller is a corporation duly organized, validly
existing and in good standing under the laws of Nevada and has all necessary
corporate power and authority to carry on its business as now conducted and to
own or lease and operate its properties, and to execute, deliver and perform its
obligations hereunder.
2.2 AUTHORITY FOR AGREEMENT. This Agreement constitutes the valid and
legally binding obligation of Seller and the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have been
duly authorized by all necessary action on the part of the board of directors
and all shareholders (listed on Schedule IV) of Seller, will not conflict with
or result in any violation of, or default under, any provisions of the charter
or bylaws of Seller, will not conflict with or result in any violation of, or
default with respect to, any mortgage, indenture, lease, agreement or other
instrument affecting the Assets or to which Seller or its affiliates is a party,
or by which Seller or its affiliates is bound, and will not require the consent
or approval or notice to any person or any governmental agency.
2.3 PROPERTIES. Seller has good, valid and marketable title to the
Assets subject to no liens, encumbrances, security interests or mortgages
whatsoever. The legal and beneficial interests in the Assets are owned
exclusively by Seller.
2.4 TAXES. Seller has paid all federal, state and local income, sales,
use, value-added, payroll, franchise and withholding taxes due and owing as a
result of the operation of the Business prior to the Closing.
2.5 LITIGATION. There is no pending or threatened litigation or
governmental or administrative proceeding to which Seller is a party or by which
the Business or the Assets may be adversely affected.
2.6 BROKERS, FINDERS, ETC. No broker, finder or other financial
consultant has acted on behalf of Seller or its affiliates in connection with
the transactions contemplated by this Agreement and all negotiations relative to
this Agreement have been carried on directly without the intervention of any
such third party.
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III. REPRESENTATIONS AND WARRANTIES OF BUYER.
3.1 CORPORATE STATUS. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Texas. Buyer has
full power and authority to execute and deliver this Agreement on Buyer's
behalf, and to perform its obligations hereunder.
3.2 AUTHORITY FOR AGREEMENT. Buyer has all necessary power and
authority to execute and deliver this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by the Board of
Directors of Buyer. No notice, consent, approval, order or authorization of, or
registration, declaration or filing with, any person or entities, or with any
governmental authority is required in connection with the execution and delivery
of this Agreement or the consummation by Buyer of the transactions contemplated
hereby or thereby.
3.3 BROKERS. FINDERS, ETC. No broker, finder or other financial
consultant has acted on behalf of Buyer or its affiliates in connection with the
transactions contemplated by this Agreement and all negotiations relative to
this Agreement have been carried on directly without the intervention of any
such third party.
IV. INDEMNIFICATION.
4.1 INDEMNIFICATION. Seller covenants and agrees to indemnify and hold
Buyer harmless from and against any and all losses, liabilities, damages,
demands, claims, suits, actions, judgments or causes of action, assessments,
costs and expenses, including, without limitation, interest, penalties,
attorneys' fees, any and all expenses incurred in investigating, preparing or
defending against any litigation, commenced or threatened, in writing or any
other claim, and any and all amounts paid in settlement of any claim asserted in
writing or litigation (each a "Loss") asserted against, resulting to, imposed
upon, or incurred or suffered by Buyer, directly or indirectly, as a result of
or arising from the operation of Seller or Business prior to the Closing Date,
other than as otherwise contemplated herein. To the extent Buyer suffers any
Loss under this Section 4.1, or has identified a loss but has not quantified the
dollar value thereof, Buyer may withhold and off-set any payments due to Seller
under this Agreement or the Promissory Note to compensate (to the extent of any
such payment due) Seller for any such Loss.
V. MISCELLANEOUS PROVISIONS.
5.1 ENTIRE AGREEMENT. This Agreement, together with all the schedules
and exhibits hereto, constitutes the entire agreement among the parties hereto
pertaining to the subject matter hereof and supersedes all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties, and there are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth herein.
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5.2 AMENDMENT. This Agreement may be amended by the parties hereto at
any time, but only by an instrument in writing duly executed and delivered on
behalf of each of the parties hereto.
5.3 HEADINGS. The section headings are not to be considered part of
this Agreement and are included solely for convenience and are not intended to
be full or accurate descriptions of the contents thereof. References to Sections
are to portions of this Agreement unless the context requires otherwise.
5.4 EXHIBITS, ETC. Exhibits and schedules referred to in this Agreement
are in integral part of and are incorporated in this Agreement by reference.
5.5 ASSIGNMENT: SUCCESSORS AND ASSIGNS. All of the terms and provisions
of this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective transferees, successors and assigns.
5.6 NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered or sent Federal Express or other reputable overnight courier, postage
prepaid or by certified mail, return receipt requested:
(i) if to Seller:
Infotainment Telepictures, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attn: President
(ii) if to the Buyer:
Digital Xxxxxxxxxxx.xxx Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Attn: President
5.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
5.8 SEVERABILITY. The provisions of this Agreement are severable, and
in the event that any one or more provisions are deemed illegal or
unenforceable, the remaining provisions shall remain in full force and effect.
5.9 COUNTERPARTS. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereby have duly executed this
Agreement as of the day and year first above written.
SELLER
INFOTAINMENT TELEPICTURES, INC.
By: /s/ J. Xxxxx Xxxxxxx
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Its: President - Secretary
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BUYER
DIGITAL XXXXXXXXXXX.XXX INC.
By: /s/ J. Xxxxx Xxxxxxx
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Its: President - Secretary
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