EXHIBIT 99.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT, dated as of August 3, 2001,
is entered into by and between Tru Dynamics International, Inc.,
a Nevada corporation ("TDII"), Columbus Companies, Inc., a Utah
corporation ("Seller"), and Xxxxx Xxxxxx and Xxxx Xxxxxx,
individuals residing in the State of Utah (collectively, the
"Purchasers").
W I T N E S S E T H :
WHEREAS, in November 2000, the Purchasers sold all of the
issued and outstanding shares of common stock of the Seller to
TDII;
WHEREAS, TDII has operated the Seller as a wholly owned
subsidiary since the acquisition; and
WHEREAS, Seller desires to sell and assign to Purchasers,
and Purchasers desire to purchase from Seller, certain assets of
Seller and Purchasers desire to assume certain liabilities of
Seller, pursuant to the terms and subject to the conditions set
forth in this Agreement; and
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements that this Agreement contains, the
parties agree as follows:
ARTICLE I
SALE AND PURCHASE OF ASSETS
Section 1.1 Purchase of Assets. On the terms and subject
to the conditions that this Agreement sets forth, and in reliance
upon the representations, warranties and covenants set forth
herein, Seller sells, assigns, transfers, conveys, and delivers
to Purchasers, and Purchasers purchase and accept from Seller,
all of Seller's right, title and interest to certain assets of
the Seller as set forth on Schedule 1.1(a) hereto (the "Purchased
Assets").
Section 1.2 Purchase Price and Other Consideration;
Payment. Purchasers shall acquire the Purchased Assets for the
following consideration:
(a) Purchasers shall assume the liabilities as set
forth on Schedule 1.2(a) hereto ("the Assumed Liabilities").
Purchasers do not assume the Agreement with Entertainment
Corporation as stated on Schedule 1.2(a). Purchasers know of no
other liabilities of Seller other than those listed on Schedule
1.2(a). Purchasers further agree to assume any additional
liabilities, should they exist, that were incurred by Purchasers
in the operation of the Seller. Purchasers do not assume any
liabilities of the Seller not incurred by them and not known to
them at the time of this transaction.
(b) With the execution of this Agreement, Purchasers
deliver stock certificates evidencing 750,000 shares of TDII
stock to TDII.
(c) The parties void and cancel any employment
contracts between Purchasers, Seller, and TDII or any of its
subsidiaries. Additionally, Purchasers release any and all
claims they may have against TDII arising out of their Employment
Agreements, dated November 17, 2000, with TDII.
(d) Cash in the amount of $10,525 for the fixed assets
set forth on Schedule 1.1(a), which value was determined by an
independent appraiser as the fair market value of such fixed
assets.
Section 1.3 Other Deliveries. Concurrently with the
execution of this Agreement, Seller shall deliver to Purchasers
duly executed Bills of Sale transferring to Purchasers all of the
Purchased Assets as well as any other documents reasonably
requested by Purchasers.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER
As an inducement by Seller to Purchasers to enter into this
Agreement, Seller and TDII hereby represent and warrant to
Purchasers as of the date hereof:
Section 2.1 Authority; Corporate Status.
(a) Authority. Seller has full corporate power and
authority to own, lease and operate its assets, properties and
business and to carry on its business as it is now being and has
been conducted. The Seller has the absolute and unrestricted
right, power, authority and capacity to execute and deliver this
Agreement, and to perform its obligations hereunder. Seller has
taken all necessary corporate action for the execution and
delivery by it of all documentation required to complete the
contemplated transaction.
(b) Organization. Seller is a corporation duly
organized, validly existing and in good standing under the laws
of the State of Utah.
Section 2.2 Title to Purchased Assets. The Seller has
good title to all the Purchased Assets free and clear of all
mortgages, liens, leases, pledges, encumbrances, and restrictions
other than (i) liens, if any, for personal property taxes and
assessments not yet due and payable, (ii) liens, leases, pledges,
encumbrances and restrictions incurred in the ordinary course of
business, none of which are material, individually or in the
aggregate; or (iii) assets sold in the ordinary course of
business and consistent with past practice.
Section 2.3 Compliance with Laws. Seller has not
received any notice of, nor has any knowledge of, any violation
or claimed violation of any federal, state, county or local law
or any ordinance, rule, regulation or order, decree, process or
requirement, except as may be known to Purchasers.
Section 2.4 Noncontravention. Neither the execution and
delivery of this Agreement nor the consummation or performance of
any of the transactions contemplated hereby will, directly or
indirectly (i) contravene, conflict with or result in a violation
of any of the provisions of the current articles of
incorporation, bylaws or other governing documents of the Seller;
or (ii) contravene, conflict with or result in a violation or
breach of any of the provisions of, or give any person or entity
the right (with or without notice or lapse of time) to declare a
default under, or to accelerate the maturity or performance of or
cancel, terminate or modify, any contract, license, permit or
authorization to which the Seller is a party or under which
Seller has any rights, or by which Seller may be bound, except as
may be known to Purchasers.
Section 2.5 Consents to Assignment. No consent,
approval, authorization or other action of any third party is
required to be obtained by the Seller in connection with the
transactions contemplated in this Agreement that has not been
obtained.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASERS
Section 3.1 Representations and Warranties of Purchasers.
Purchasers hereby represent and warrant to Seller as follows:
(a) Authority. Purchasers have full power and
authority to enter into and deliver this Agreement.
(b) Restrictive Documents. The Purchasers are not
subject to any mortgage, lien, lease, agreement, instrument,
order, law, rule, regulation, judgment or decree, or any other
restriction of any kind or character, which would prevent
consummation of the transactions contemplated by this Agreement
by them.
ARTICLE IV
GENERAL
Section 4.1 Further Assurances. The parties hereto agree
that, from time to time after the date hereof, upon the
reasonable request of the others, they will cooperate with each
other to effect the orderly transition of the business. Without
limiting the generality of the foregoing, (i) Seller will provide
representatives of Purchasers reasonable access to all books and
records of the Seller related to the business and the Purchased
Assets reasonably requested by the Purchasers, and will otherwise
cooperate with the Purchasers, in connection with the preparation
of any post-closing financial statements, reports, or tax returns
of the business; (ii) the Purchasers will provide representatives
of the Seller reasonable access to all pre-closing books and
records of the business reasonably requested by Seller in the
preparation of any post-closing financial statements, reports, or
tax returns of the Seller; and (iii) each party hereto will
execute such documents and instruments as the other party hereto
may reasonably request containing terms and conditions mutually
satisfactory to each party hereto to further effectuate the terms
hereof.
Section 4.2 Notices. Notices and other communications
provided for herein shall be in writing (including wire, telex,
telecopy or similar writing) and shall be sent, delivered,
telexed, or telecopied to:
(a) If to Seller: Columbus Companies
0000 Xxxxx Xxxxxxxxxx Xxxx.,
Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attention:___________________________
Fax: ________________________________
(b) If to Purchasers: Xxxx Xxxxxx
Xxxxx Xxxxxx
0000 Xxxxx 000 Xxxx
Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
Notices by mail shall be by certified or registered mail, return
receipt requested.
Section 4.3 Assignment. This Agreement shall not be
assignable by any party without the prior written consent of the
other party. Nothing contained in this Agreement, express or
implied, is intended to confer upon any person or entity other
than the parties hereto and their successors in interest and
permitted assignees, any rights or remedies under or by reason
of this Agreement, unless expressly so stated to the contrary.
Section 4.4 Time is of the Essence. Time is of the
essence in respect to all provisions of this Agreement in which
a definite time for performance is specified, provided, however,
that the foregoing shall not be construed to limit or deprive a
party of the benefit of any grace or use period provided for in
this Agreement.
Section 4.5 Entire Agreement. This Agreement and the
schedules, exhibits and certificates specifically referred to
herein or required to be delivered pursuant to the terms hereof
represent the entire agreement of the parties hereto with
respect to the subject matter hereof, superseding all prior
agreements, understandings, discussions, negotiations and
commitments of any kind. This Agreement may not be amended or
supplemented, nor may any rights hereunder be waived, except in
a writing signed by each of the parties affected thereby.
Section 4.6 Section Headings. The section headings in
this Agreement are included for convenience only, are not a part
of this Agreement and shall not be used in construing it.
Section 4.7 Counterparts. This Agreement may be
executed in one or more 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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Section 4.8 Governing Law; Venue. The validity,
interpretation, enforceability, and performance of this
Agreement shall be governed by and construed in accordance with
the laws of the State of Utah, applicable to contracts executed
and to be wholly performed in such State, Jurisdiction and
Venue in Utah or Arizona is proper.
Section 4.9 Expenses. Except as set forth below or as
otherwise specified herein, each party hereto shall pay its own
legal, accounting, out-of-pocket broker fees and other expenses
incident to this Agreement and to any action taken by such party
in preparation for carrying this Agreement into effect.
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first above mentioned.
SELLER: COLUMBUS COMPANIES, INC.
By: /s/ Xxxx Xxxxxx
------------------------------
Xxxx Xxxxxx
President
PURCHASERS:
By: /s/ Xxxxx Xxxxxx
----------------------------------
Xxxxx Xxxxxx
By: /s/ Xxxx Xxxxxx
----------------------------------
TRU DYNAMICS INTERNATIONAL, INC.
By: /s/ Xxxxx Xxx
-------------------------------------
Secretary
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Schedule 1.1(a) - Purchased Asset List
Xxxxx Xxxxxx and Xxxx Xxxxxx (buyer) are purchasing the following
assets from Columbus Companies (seller). The current Assets and
Other Assets listed below are current as of June 30, 2001. The
detail of these Assets appears on the Columbus Balance Sheet with
the exception of the Fixed Assets, which have been apprised and
are listed on the attached Appraisal Report. Other than as
noted, both buyer and seller are satisfied that no significant
changes have occurred and agree to accept the value of these
assets as follows.
Current Assets
Cash on Hand $ 100.00
Cash in Bank 37,394.85
Accounts Receivable Customers 543.70
Account Receivable-Other 36,078.83
Credit Card Commissions Due 14,574.92
Other Current Assets 1,940.00
Total 90,632.30
Fixed Assets
Total $ 10,525.00*
Other Assets
Prepaid Expenses and Deposits $ 11,742.89
Total Assets $112,900.19
Intangible Non-financial Assets
Trade names and trademarks of Columbus Companies dba's including,
Columbus Travel, Insider Secrets and other dba's registered to
Columbus Companies as of the date of transaction. Airline
appointments, cruise line appointments and other travel related
appointments and contracts currently in the name of Columbus
Companies or Columbus Travel.
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Schedule 1.2(a) Schedule of Liabilities Assumed
Xxxxx Xxxxxx and Xxxx Xxxxxx (buyer) are assuming the following
liabilities from Columbus Companies (seller). The Current
Liabilities and Other Liabilities listed below are current as of
June 30, 2001 and appear on the Columbus Balance Sheet with the
exception of the Accrued Unpaid Salary, which is unpaid
compensation due to Gelwix and Faldmo. Other than as noted,
buyer and seller are satisfied that no significant changes have
occurred since the June 30, 2001 Balance Sheet and both seller
and buyer agree to accept the value of these liabilities as
follows:
Current Liabilities
Non ARC payable $(4,243.13)
ARC Payable (532.65)
Unapplied Funds (1,083.90)
Payroll Taxes Payable 3,909.08
Other Current Liabilities 162,723.81
Accrued Unpaid Salary 16,700.00
Total $177,423.81
Other Liabilities
Long Term Notes Payable $ 22,607.03
Other Non-Current Liabilities 8,154.73
Total $ 30,761.76
Total Liabilities $208,185.57
Intangible Liabilities Not Include Above:
Purchasers agree to assume any leases and contracts entered into
by Purchasers or their authorized employees on behalf of Columbus
Companies. The Agreement with Entertainment Corporation is not
accepted and remains with Columbus Companies.
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