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Exhibit 2.6
ASSET PURCHASE AGREEMENT
AGREEMENT made as of this 16th day of September, 1998 between GEN
INTERNATIONAL, INC., a Florida corporation with a principal place of business at
0000 000xx X. Xxxxxx Xxxx, Xx. Xxxxxxxxxx, Xxxxxxx (the "Company"), XXXXXX
XXXXXXX, residing at 00000 Xxxx Xxxxxxxxx, Xxx. 00X, Xxxxxxxxx Xxxxxx, Xxxxxxx
(the "Shareholder"), and SAGE NETWORKS ACQUISITION CORP., a Delaware corporation
having an office at 000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 ("Buyer").
W I T N E S S E T H :
WHEREAS, the Company desires to sell and the Buyer desires to
purchase on the date hereof (the "Closing Date") the Internet Web hosting
business of the Company as a going concern (the "Business") consisting of the
Purchased Assets (hereinafter defined), and the Assumed Liabilities (as
hereinafter defined), for a purchase price determined as set forth in Exhibit A
(the "Purchase Price") and for the assumption of the Assumed Liabilities
(hereinafter defined); and
WHEREAS, the Company has from time to time conducted certain
operations or administrative functions of the Business through Global
Entrepreneurs Network, Inc. ("Global"), Gen Network Operations Centers, Inc.
("Network") and International Management Agency, Inc. ("IMA"); and
WHEREAS, the Shareholder joins in the execution of this Agreement as
the controlling shareholder of Virtual Ventures, Ltd. ("Virtual"), the majority
shareholder of the Company, as well as a director and officer of the Company,
and is familiar with the material aspects of operations of the business of the
Company, including, without limitation, the Business.
WHEREAS, Global and the Buyers are concurrently with the execution
of this Agreement, entering into an Asset Purchase Agreement (the "Global
Agreement") whereby (i) Buyer agrees to purchase and Global agrees to sell to
Buyer all of the equipment presently leased or owned by Global and used in the
Business and (ii) Global agrees to transfer, sell and assign to Buyer all of its
rights, title and interest to the assets sold by Global to the Company under an
Agreement of Sale dated June 9, 1997 (the "Agreement of Sale"), all of which is
conditioned upon the issuance of an Order of a Court of Bankruptcy affirming the
sale and status of Buyers as provided hereinafter;
NOW THEREFORE, in consideration of the mutual covenants and promises
contained in this Agreement, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by all parties, the
parties hereto agree as follows:
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ARTICLE I
AGREEMENT TO SELL
Section 1. Purchase and Sale. Subject to the terms and conditions of
this Agreement, the Company hereby sells, assigns and transfers to the Buyer and
the Buyer hereby purchases and acquires from the Company, all of the right,
title and interest of the Company in and to the Purchased Assets (as hereinafter
defined) for the Purchase Price set forth herein.
Section 2. Intentionally Deleted
Section 3. Payment of the Purchase Price. The Purchase Price
($455,000) shall be paid as follows:
(A) Downpayment. At the Closing, $150,000 of the Purchase Price (the
"Downpayment") will be paid by Buyer to Seller.
(B) Balance. The balance of the Purchase Price ($305,000) shall be
placed into escrow by the Buyer at the Closing and held by the Escrow
Agent listed on Exhibit A pursuant to the terms of an Escrow Agreement to
be entered into between the parties at the Closing ("Purchase Price Escrow
Agreement"). . The Purchase Price Escrow Agreement, among other things,
shall provide that the entire escrow amount, except for the amount that
will continue to be held in escrow pursuant to Paragraph (E) of Section 2
of Article III, shall be released from escrow and paid to the Company
within five business days after the receipt by the Buyer and Escrow Agent
of a final nonappealable Order issued by the United States Bankruptcy
Court for the Middle District of Florida, Tampa Division (the "Court"), in
form and substance satisfactory to Buyer and its counsel that the Court,
among other things, has approved the sale by Global to the Buyer of the
equipment presently owned by Global and/or covered by the Equipment Leases
and the transfer, sale and assignment by Global to the Buyer of its
rights, title and interest against the Company on account of the sale of
certain assets to the Company pursuant to the Agreement of Sale, as
provided in the Global Agreement (the "Bankruptcy Order").
Section 4. Reallocation of Purchase Price; Termination.
A. In the event the Bankruptcy Court overseeing the Global
bankruptcy indicates that it will not issue the Bankruptcy Order referred to in
Xxxxxxx 0, Xxxxxxxxx (X) above, Buyer, in its sole discretion, may, but shall
not be obligated to, reallocate all or a portion of the balance of the Purchase
Price then held in escrow to the assets being acquired under the Global
Agreement, based upon the total amount of the allowed claims of the creditors in
the Global bankruptcy case in order to obtain an Order from the Bankruptcy Court
approving the Global Agreement, in form and substance satisfactory to Buyer and
its counsel. In such event, the Purchase Price Escrow Agreement shall require
the Escrow Agent to make such payments to the creditors of Global or
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the Court, as directed in writing by Buyer. Notwithstanding any other provision
of this Agreement, unless and until a final, nonappealable order is entered by
the Bankruptcy Court meeting the requirements of Section 5 of the Global
Agreement, neither the Seller nor Global, nor the Global bankrupt estate, nor
any third party, shall have any interest in the amount being held by the Escrow
Agent under the Purchase Price Escrow Agreement.
B. In the event the Bankruptcy Court overseeing the Global
bankruptcy indicates that it will not issue the Bankruptcy Order referred to in
Section 3, Paragraph (B) above, or if no such order is issued by December 31,
1998, and if Buyer elects not to reallocate the Purchase Price pursuant to
Paragraph A. of this Section 4 of Article I, then the parties agree that this
Agreement shall be null and void and the Purchase Price Escrow Agreement shall
require the Escrow Agent to return the entire amount being held in escrow to the
Buyer.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 1. Representations of the Company and the Shareholder. The
following agreements, representations and warranties are made by the Company and
the Shareholder, jointly and severally, to the Buyer.
(A) Corporate Matters; No Conflict. The Company, Global, Network and
IMA (collectively, the "GEN Companies"), each is duly formed, organized,
incorporated, is validly existing and in good standing under the laws of its
state of incorporation as set forth in Exhibit A, maintains offices only at the
sites listed on Exhibit A and has no other operations other than from those
sites, is qualified or authorized to transact business and is in good standing
in each other jurisdiction in which it is doing business, except where failure
to be qualified or be in good standing would not have a material adverse effect
on the Business, and the Company has the corporate power to enter into this
Agreement, to perform its obligations hereunder and to conduct its business as
currently conducted. The execution, delivery and performance of this Agreement
and the transactions contemplated hereby by the Company and by the Shareholder
will not (i) conflict with or violate the provisions of any applicable law
(including, without limitation, any bulk sales laws), rule or order or the
respective Articles or Certificate of Incorporation, by-laws or any other
organizational or governing documents of the GEN Companies, (ii) conflict with
or constitute a default under any agreement or contract by which any of the GEN
Companies, Virtual or the Shareholder is bound or (iii) require the consent or
approval of, or filing with, any governmental body or third party except as set
forth on Exhibit C-5. The execution, delivery and performance by the Company of
this Agreement has been duly authorized and approved by all requisite corporate
action on the part of the Company, and the authorized officers of the Company
named on Exhibit A are jointly and severally authorized and empowered by the
Company to execute and deliver this Agreement in the name and on behalf of the
Company. Virtual owns the number of shares of such stock set forth opposite its
name on Exhibit A. Also set forth on Exhibit A is the total number and type of
authorized shares and
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outstanding shares of capital stock of the Company. Set forth on Exhibit B is a
list of officers and directors of the Company, all trade names used by the
Company and all jurisdictions in which the Company is doing business.
(B) Purchased Assets. (i) All vendor and customer contracts,
confidentiality agreements, purchase and sales orders, powers of attorney,
undertakings, commitments and other agreements to which the Company or any of
the GEN Companies is a party and which relate in any manner to the Business
and/or the relationship between the Company or any of the GEN Companies and the
Customers (hereinafter defined), whether written or oral, shall be referred to
herein collectively as the "Business Agreements". The Company has delivered to
Buyer, on or before the Closing Date, true and correct copies of all written
Business Agreements and detailed summaries of all oral agreements. Attached
hereto as Exhibit C-1 are true and correct copies of the only forms of
agreements which have been entered into between any of the Companies and its
customers concerning the Business. Contained on a computer diskette provided by
the Company to Buyer is a true and complete copy of the Company's customer list
as of the Closing Date relating to the Business which includes, in the case of
each customer, the name of the customer, its billing and E-mail addresses, the
name of a contact person, with a designation of which form of agreement each
customer has entered into. Annexed as Exhibit C-2 is a detailed summary of all
oral Business Agreements, as well as all written Business Agreements between the
Company and vendors or service providers, or which relate to any strategic
partnerships or joint ventures between any of the Companies and others,
concerning the Business, including a schedule of all reselling agreements
entered into by the Company and in existence as of the Closing Date. Listed on
Exhibit C-3 is a description of each and every real estate, equipment and
personal property lease to which the Company is a party and which relates to the
Business. The Leases are also included within the definition of Business
Agreements as said term is used herein. Neither the Company nor any other party,
is in default under any Business Agreement and no other party to any Business
Agreement has made any claim or given the Company notice of any dispute under
any Business Agreement, except as set forth on Exhibit C-4. Each Business
Agreement is in full force and effect and the Company has the right to assign
the Business Agreements and the Company has obtained all required consents to
the assignment and transfer thereof, except as set forth on Exhibit C-5. The
Company is not the owner or lessee of any motor vehicles which are used in the
Business. None of the GEN Companies own or lease any interest in any real
property, or lease any equipment used in the Business, except as expressly
stated on Exhibit C-3.
(ii) All of the tangible assets of the GEN Companies used in
the Business, including, without limitation, all machinery, office and other
equipment, furniture, computers and related equipment, business machines,
telephones and telephone systems, parts and accessories, telephone numbers,
facsimile numbers, e-mail addresses, Internet domain addresses presently
utilized by the GEN Companies in the Business and all Internet domain addresses
of customers of the Company which are presently "parked" or located on the
Company's servers, shall be referred to herein collectively as the "Tangible
Assets". There are no assets used in the Business which are owned by any of the
following subsidiaries of the Company: Gen Europe, Inc.; Gen Events, Inc.; Gen
Networks Center, Inc.; Gen Service Center, Inc.; or IMA. Attached hereto as
Exhibit E is a true and correct list or description of the material
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Tangible Assets. As of the Closing Date, each of the Tangible Assets is in good
and operable condition, reasonable wear and tear excepted.
(iii) All patents, trademarks, trade names, service marks,
service names, logos, designs, formulations, copyrights and other trade rights
and all registrations and applications therefor, all know-how, trade secrets,
technology or processes, all Web sites, and all computer programs, data bases
and software documentation owned or used by any of the GEN Companies in the
Business, other than off-the-shelf software licensed by any of the GEN
Companies, shall be referred to herein collectively as the "Intellectual
Property". Attached hereto as Exhibit F is a true and correct copy of all of the
Intellectual Property. Such exhibit also indicates which of such items have been
patented or registered or are in the process of application for same. The
Company has taken all necessary and reasonable actions to protect its rights in
Intellectual Property owned by it and to the knowledge of the Company, is not
infringing on the rights of any third parties to Intellectual Property used, but
not owned by, the Company. Included among the Intellectual Property, among other
things, are all trade names utilized by the Company in the Business, including
those trade names listed on Exhibit B. Also attached to Exhibit F is a true and
complete list of all software licensed by the Company and used in operating and
maintaining the Business (collectively, the "Licensed Software"). The Company
has valid, royalty free and fully-paid licenses for all of the Licensed
Software. On the Closing Date, the Company will deliver to Buyer written proof
in form and substance satisfactory to Buyer and its counsel that the Company
will no longer do business under any of the trade names listed on Exhibit B and
further, within five (5) days from the Closing, Company will cause to be filed
in all applicable governmental or quasi-governmental offices, any required
instruments to terminate any previously filed assumed name or similar
certificates regarding such trade names. Promptly after such filing, the Company
will deliver proof of said filing to Buyer.
(iv) The Company will deliver at the Closing a diskette
containing a true and complete schedule of the Company's customer list as of the
Closing Date relating to the Business which includes, in the case of each
customer, the name of the customer, its billing and E-mail addresses, the
identity of a contact person, and the type of contract applicable to the
customer (the "Customer List"). All customers of the Company relating to the
Business, including without limitation, those customers included on the Customer
List, shall be referred to herein as the "Customers".
(v) As used herein, the term "Purchased Assets" shall be
defined as all classes of assets of the Company as shown on the Company's
certified financial statement as of December 31, 1997 (annexed as Exhibit H)
including, without limitation, the Business Agreements, the Tangible Assets, the
Intellectual Property, the Customer List, the Customers, the good will and
business opportunities of the Company as it relates to the Business, the
Software Licenses and all other assets of the Company used in connection with
the operation of the Business, wherever located, tangible or intangible,
including without limitation, all rights the Company may have under any
insurance policies relating to the Purchased Assets, together with all books,
records and files (whether in paper or electronic format) concerning any of the
above assets, excluding, however, Excluded Assets (as defined below) The
Purchased Assets are not subject to (i) any lien or encumbrance of any character
whatsoever except as set forth on Exhibit
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M or (ii) any adverse claims by any third parties. At the Closing upon
consummation of the transactions contemplated by this Agreement, subject to the
Court approval referred to in Section 3 (B) of Article I hereof, Buyer will
receive good and marketable title to the Purchased Assets, free and clear of all
liens, claims and encumbrances of any character whatsoever. The Purchased Assets
include all rights, properties, interests and assets used by Company and/or
necessary to permit Buyer to carry on the Business as presently conducted by the
Company except for Excluded Assets.
(vi) The Company and the Shareholder reasonably expect that
the business represented by the Business Agreements will continue after the date
hereof. Neither the Company nor the Shareholder has any knowledge that any
customers included on the Customer List, other than those listed on Exhibit G-1,
intend to terminate or reduce the amount of business they presently do with the
Company, and they have no knowledge of any state of facts which would lead them
to believe that any of the customers included on the Customer List will
terminate their relationship with the Company or significantly reduce the amount
of business they presently do with the Company.
(vii) Excluded Assets. The Company is not selling and
Purchaser is not buying or acquiring hereunder the following items ("Excluded
Assets") which are not included in the defined term "Purchased Assets": (a) All
cash and cash equivalents; (b) the Company's corporate minute and stock books,
tax returns and other records having to do solely with the Company's
organization and/or capitalization; (c) all outstanding billed receivables of
the Company including inter Company receivables; (d) any rights to any of the
Company's claims for any federal, state or local tax refunds; (e) any rights
which accrue or will accrue to the Company under this Agreement or the
transactions contemplated hereby; (f) all claims held or asserted by the Company
against third parties, as described on Exhibit L; (g) all office computers other
than computers used by technical support personnel of the Company used in the
Business; (h) the real estate lease listed in Schedule C-3 and the security
deposit related thereto; (i) all office furniture and furnishings; (j) all
employee advances ; (k) all investments of the Company listed on Exhibit L; and
(l) all assets, if any, listed on Exhibit L hereto.
(C) Financial Statements. The Company has delivered to the Buyer
copies of the Company's unaudited financial statements for the seven months
ended December 31, 1997, and for the eight month period beginning January 1,
1998 and ended August 31, 1998. The Company has also delivered to Buyer the
following unaudited financial statements for subsidiaries and a related a
related company: Global Entrepreneurs Networks, Inc. ("Global") for the years
ended December 31, 1995, 1996, and 1997 and for the five months ended May 31,
1998; Network for the nine months ended September 30, 1998; GEN '98 for the six
months ended June 30, 1998 (being Global's operations since Global filed under
the Bankruptcy Act); and International Management Agency, Inc. for the six
months ended June 30, 1998. Attached hereto as Exhibit H are the foregoing
financial statements all of which reflect the assets, liabilities, net worth,
profit and loss, and cash flow of the Company with respect to the Business. All
financial statements referred to herein are complete and correct in all material
respects, present fairly the financial condition and results of operations of
the Company as at the dates of
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such statements and have been prepared in accordance with generally accepted
accounting principles. The books of account and records of the Company have been
maintained in accordance with good business practice and reflect fairly all
properties, assets, liabilities and transactions of the Company. The Company has
no material liabilities or obligations of any kind (whether accrued, absolute,
direct, indirect, contingent or otherwise) which are not fully accrued or
reserved against in the Company's financial statements in accordance with
generally accepted accounting principles. Except as set forth on Exhibit I the
Company has no bad debts as of the Closing Date. Since the last day of the
Company's last fiscal year, the Company has conducted the Business only in the
ordinary and usual course and has not experienced any material adverse change in
the Business or the financial condition of the Company. Since August 31, 1998,
the Company has had no loss in net monthly recurring revenue from the Business.
Between August 31, 1998 and the Closing Date, the Company and the Shareholders
warrant and represent that they have not withdrawn, expended or applied any cash
or other assets of the Company, except in the ordinary course of operations of
the Business of the Company in accordance with past practices of the Company,
and that during such period, no amounts have been paid to the Shareholder except
for salaries of $ 1,000.
(D) Assumed Liabilities. The Buyer shall not be liable for and is
not assuming any liabilities of the Company whatsoever, whether related or
unrelated to the Purchased Assets, or whether arising under the Business
Agreements or otherwise, unless specifically listed on Exhibit J hereto (the
"Assumed Liabilities"). The Company and the Shareholder understand and agree
that the Buyer is not assuming any liabilities of the Shareholder, Virtual,
Global, Network, IMA or any other shareholder of Global, Network or IMA except
as specifically indicated herein. The Company has no outstanding loans of any
kind other than as set forth on Exhibit J and none of the Company's obligations
have been guaranteed by any other person or entity.
(E) Existing Employment Arrangements. Except as set forth on Exhibit
K the Company has no employment agreements, labor or collective bargaining
agreements or employee benefit or welfare plans. All vacation pay, if any, due
to employees of the Company has been fully paid by the Company. No employees of
the Company are entitled to any sick pay. The Company has no retirement plans.
There are no pending or, to the knowledge of the Company, threatened strikes,
job actions or other labor disputes affecting the Company or its employees and
there have been no such disputes for the past three years. Also set forth on
Exhibit K is a true and complete list of all employees of the Company employed
in connection with the Business, which list provides, among other things, the
name, residence address, title, job description and salary information
concerning each employee.
(F) Claims, Litigation, Disclosure. There is no claim, litigation,
tax audit, proceeding or investigation pending or, to the Company's or the
Shareholder's knowledge, threatened against any of the GEN Companies, Virtual,
the Shareholder or any other shareholder of the Company, with respect to the
Business or any of the Purchased Assets of the Company (including, without
limitation, any claims of infringement or actions of opposition with respect to
Intellectual Property), nor does the Company nor the Shareholder know of any
facts which would
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provide a basis for any such claim, litigation, audit, proceeding or
investigation.
(G) Taxes. Except as specifically set forth on Exhibit I (the "Tax
Liabilities"), the Company has correctly prepared and timely filed all Federal,
state and local tax returns, estimates and reports, and paid all such taxes as
and when due. For purposes of this paragraph, taxes shall mean all taxes,
charges, fees, levies or other assessments of any kind whatsoever (including,
without limitation, income, franchise, sales, use and withholding taxes). On or
before the Closing, the Company shall pay off and satisfy any of the Tax
Liabilities which are then due and payable or payable with respect to the
Purchased Assets for the period ending on the Closing Date whether or not then
due, and provide Buyer with evidence thereof in form satisfactory to Buyer and
its counsel. The Company is not a party to any tax sharing agreement.
(H) No Other Agreements to Sell Assets or Business. Neither the
Company, Virtual, the Shareholder nor any of the other Shareholders of the
Company are parties to any existing agreement which obligates the Company,
Virtual, the Shareholder or the other shareholders of the Company to sell to any
other person or firm the Purchased Assets (other than sales in the ordinary
course of business), to issue or sell any capital stock or any security
convertible into or exchangeable for capital stock of the Company or to effect
any merger, consolidation or other reorganization of the Company or to enter
into any agreement with respect thereto.
(I) No Brokers. The only broker, leasing agent, finder or similar
person or entity with whom the Company or the Shareholder have made contact or
had any dealings with or entered into any agreement, arrangement or
understanding with concerning this Agreement and to whom the Company and/or the
Shareholder are responsible to pay a finder's fee, brokerage commission or
similar payment to is the party or parties listed in item 6 on Exhibit A, if
any, and the Buyer shall be solely responsible for the payment of same.
(J) Environmental Compliance. (i) Neither the Company nor any
operator of the Company's properties is in violation, or alleged to be in
violation, of any federal, state or local judgment, decree, order, consent
agreement, law (including common law), license, rule or regulation pertaining to
environmental health or safety matters, including without limitation those
arising under the Resource Conservation and Recovery Act, as amended, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986, as
amended, Water Act, as amended, the Federal Clean Air Act, as amended, the Toxic
Substances Control Act, or any state or local analogue (hereinafter
"Environmental Laws").
(ii) Neither the Company nor the Shareholder has received a
notice, complaint, order, directive, claim or citation from any third party,
including without limitation any federal, state or local governmental authority,
indicating or alleging that the Company or any predecessor may have any
liability or obligation under any Environmental Law.
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(iii) (A) No portion of the property of the Company has been
used by any person for the generation, handling, processing, treatment, storage
or disposal of Hazardous Materials except in accordance with applicable
Environmental Laws; (B) no underground tank or other underground storage
receptacle for Hazardous Materials, asbestos-containing materials or
polychlorinated biphenyls are located on any portion of any location occupied by
the Company each of which is listed as a Site on Exhibit A; (C) in the course of
any activities conducted by the Company or its invitees, agents, contractors,
licensees or employees in connection with the Business of the Company, no
Hazardous Materials have been generated or are being used except in accordance
with applicable Environmental Laws; and (D) there have been no releases (i.e.,
any past or present releasing, spilling, leaking, leaching, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, disposing or dumping) or
threatened releases of Hazardous Materials on, upon, into or from the property
currently or formerly owned, operated or leased by the Company, which releases
would have a material adverse effect on the value of any of the property or
adjacent properties or the environment.
(iv) The execution, delivery and performance of this Agreement
is not subject to any Environmental Laws which condition, restrict or prohibit
the sale, lease or other transfer of property or operations, including, without
limitation, any so-called "environmental cleanup responsibility acts" or
requirements for the transfer of permits, approvals, or licenses. There have
been no environmentally related audits, studies, reports, analyses (including
soil and groundwater analyses), or investigations of any kind performed with
respect to the currently or previously owned, leased, or operated properties of
the Company.
For purposes of this Section, "Hazardous Material" shall mean any
hazardous waste, as defined by 42 U.S.C. Sec. 6903(5), any hazardous substances
or wastes as defined by 42 U.S.C. Sec. 9601(14), any pollutant or contaminant as
defined by 42 U.S.C. Sec. 9601(33) or any toxic substances or wastes, oil or
hazardous materials or other chemicals or substances regulated by any public or
governmental authority.
(K) Year 2000. All information technology included in the Purchased
Assets including, without limitation, in all products and services (i) provided
by the Business, whether to third parties or for internal use or (ii) to the
best of the Company's knowledge after reasonable investigation, used in
combination with any information technology of its clients, customers, suppliers
or vendors, accurately processes or will process date and time data (including,
but not limited to calculating, comparing and sequencing) from, into and between
the years 1999 and 2000 and the twentieth century and the twenty-first century,
including leap year calculations and neither performance nor functionality of
such technology will be affected by dates prior to, during and after the year
2000. The Purchased Assets do not include any obligations under warranty
agreements, service agreements or otherwise to remedy any information technology
defect relating to the year 2000.
(L) Licenses and Compliance with Laws. The Company holds no material
governmental or regulatory licenses, permits, consents or approvals in
connection with the
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Business, and the Company is in compliance with all material laws and
regulations applicable to the Business.
(M) True and Complete. No representation or warranty made by Company
or the Shareholder in this Agreement, nor any statement, certificate or exhibit
furnished by or on behalf of Company pursuant to this Agreement, nor any
document or certificate delivered to Buyer pursuant to this Agreement, or in
connection with the transactions contemplated hereby, contains or shall contain
any untrue statement of a material fact, or omits or shall omit to state a
material fact necessary to make the statements contained therein not misleading.
Neither the Company nor the Shareholder has failed to disclose to Buyer any
pending developments or circumstances of which either of them are aware which
are reasonably likely to have a material adverse effect on the Company or the
Business.
Section 2. Representations of the Buyer. Buyer represents and
warrants to the Company and the Shareholder as follows.
(A) Corporate Matters; No Conflict. Buyer is a wholly owned
subsidiary of Sage Networks, Inc. ("Parent"). Each of the Buyer and Parent is
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware, is in good standing in each other jurisdiction in which it is
doing business, except where failure to be in good standing would not have a
material adverse effect on the business of Buyer or Parent, and has the
corporate power to enter into this Agreement, to perform its obligations
hereunder and to conduct its business as currently conducted. The execution,
delivery and performance of this Agreement and the transactions contemplated
hereby (and thereby) by the Buyer and Parent, respectively, will not (a)
conflict with or violate the provisions of any applicable law, rule or order or
the Buyer's or the Parent's respective Certificate of Incorporation or by-laws,
(b) conflict with or constitute a default under any agreement or contract by
which the Buyer or Parent is bound or (c) require the consent or approval of, or
filing with, any governmental body or third party. The execution, delivery and
performance by the Buyer of this Agreement has been authorized and approved by
all requisite corporate action on the part of the Buyer.
(B) No Brokers. The only broker, leasing agent, finder or similar
person or entity with whom the Buyer or Parent has made contact or had any
dealings with or entered into any agreement, arrangement or understanding with
concerning this Agreement and to whom the Buyer and/or the Parent is responsible
to pay a finder's fee, brokerage commission or similar payment to is the party
listed in item 7 on Exhibit A, if any, and the Buyer shall be solely responsible
for the payment of same.
ARTICLE III
CERTAIN COVENANTS OF THE COMPANY AND THE SHAREHOLDER
Section 1. Non-competition; non-solicitation.
(A) For a period commencing on the Closing Date and ending on the
second
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anniversary of the Closing Date, neither the Company nor the Shareholder shall
engage in any capacity in an Internet Web hosting business which is similar to
or in competition with the Business and is located or does business in any state
in the United States or in any other part of the World.
(B) The Company and the Shareholder understand that pursuant to this
Agreement they have received confidential and proprietary information of Buyer,
Parent and their respective affiliates, including, without limitation, customer
lists and other trade secrets. Neither the Company nor the Shareholder, nor any
of the Company's officers, directors, employees, agents or contractors who
received or learned of such confidential and proprietary information shall at
any time, either before or after the Closing Date, disclose to any third party
any such confidential or proprietary information of Buyer or make use of any of
such information except in evaluating whether to enter into this Agreement. In
connection with such evaluation, the Company and the Shareholder may disclose
such proprietary information to their legal and financial consultants on a need
to know basis on the condition that those consultants are similarly prohibited
from further disclosing such information as provided herein.
(C) For a period commencing on the Closing Date and ending on the
second anniversary of the Closing Date, neither the Company, nor the
Shareholder, unless acting with the express written consent of the Buyer or
Parent, will, directly or indirectly, interfere with, solicit or endeavor to
entice away:
(i) any person who was an employee, subcontractor or
consultant of the Company, the Buyer, the Parent or any of their
affiliates during the twelve months immediately preceding the date
of such solicitation, interference or endeavor,
(ii) with respect to any Internet Web hosting business similar
to or in competition with the Business in which the Company, Buyer,
Parent, or any of their affiliates is or has been engaged after the
date of this Agreement, any person or entity who was a customer or
client of the Company or of the Buyer or of the Parent, or any
person or entity who requested or received a proposal from Buyer,
Parent or the Company.
The Company and the Shareholder, and each of them, expressly acknowledges,
understands and agrees (i) that remedies at law for any breach of this Article
III, Section 1 will be inadequate, (ii) that the damages resulting from such
breach are not readily susceptible to measurement in monetary terms and (iii)
that Buyer and/or Parent shall be entitled to immediate injunctive relief and
may obtain temporary and permanent orders restraining any threatened or further
breach of this Article III, Section 1 by the Company and/or the Shareholder. The
Company and the Shareholder have been advised by their respective counsel with
respect to the meaning and effect of this Article III, Section 1.
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Section 2. Survival of Representations and Warranties;
Indemnification.
(A) The representations and warranties of the parties herein
contained shall survive the closing of the purchase contemplated by this
Agreement, notwithstanding any investigation at any time made by or on behalf of
the other party, provided that any claims for indemnification in accordance with
Article III, Section 2 below with respect to any representation or warranty must
be made (and will be null and void unless made) on or before the date
twenty-four (24) months following the Closing Date (except in the case of
representations contained in Paragraphs (B)(v), (G), (I) and (J) of Article II,
Section 1 hereof, which must be made within six (6) months following the
expiration of the applicable statute of limitations).
(B) The Company and the Shareholder, jointly and severally, hereby
agree to indemnify and hold Buyer, Parent, and their respective officers,
directors, stockholders, affiliates, employees, representatives and other agents
harmless from and against any and all claims, liabilities, losses, damages or
injuries, together with costs and expenses, including reasonable legal fees,
arising out of or resulting from (i) any breach, misrepresentation or material
omission of the representations and warranties made by the Company and/or the
Shareholder in this Agreement or in any Exhibit hereto or other documents
delivered in connection herewith, (ii) any breach in any material respect by the
Company and/or the Shareholder, unless waived in writing by the Buyer, of any
covenant or agreement contained in or arising out of this Agreement, or any
other agreement delivered in connection herewith on the Closing Date, including
without limitation, the Employment Agreements (hereafter defined), (iii) the
Business conducted by the Company prior to the Closing Date and any actions or
events associated therewith, (iv) any and all liabilities of the Company, other
than the Assumed Liabilities, and (v) any failure by Virtual, the Shareholder or
the Company to comply with any provisions of the bulk sales or similar laws of
any jurisdiction which are applicable to this Agreement or the transactions
contemplated hereby.
(C) Buyer hereby agrees to indemnify and hold the Company and the
Shareholder harmless from and against any and all claims, liabilities, losses,
damages or injuries, together with costs and expenses, including reasonable
legal fees, arising out of or resulting from (i) any breach, misrepresentation
or material omission in the representations and warranties made by the Buyer in
this Agreement, (ii) any breach in any material respect by Buyer, unless waived
in writing by the Company, of any covenant or agreement of Buyer contained in or
arising out of this Agreement, or (iii) the Business as conducted by Buyer,
after the Closing Date.
(D) Any party claiming a right to indemnification hereunder (the
"Indemnified Party") shall give the other party from whom indemnification is
sought (the "Indemnifying Party") prompt written notice of any claim, demand,
action, suit, proceeding or discovery of fact upon which the Indemnified Party
intends to base a claim for indemnification under this Section 2, provided,
however, that no failure to give such notice shall excuse any Indemnifying Party
from any obligation hereunder except to the extent the Indemnifying Party is
materially prejudiced by such failure. The Indemnifying Party after
acknowledgment in writing to the Indemnified Party of its liability and
obligation to indemnify hereunder, shall have full responsibility and authority
with respect to the disposition of any action, suit or proceeding
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brought against it; provided, however, that it will not settle any such action,
suit or proceeding without the prior written consent of the Indemnified Party,
which will not be unreasonably withheld or delayed. In the event any action,
suit or proceeding is brought against the Indemnified Party with respect to
which the Indemnifying Party may have liability under the indemnity agreements
contained in Paragraphs (B) and (C) of Article III, Section 2 hereof, however,
the Indemnifying Party shall have the right, without prejudice to the
Indemnified Party's rights under this Agreement, at the Indemnifying Party's
sole expense, to be represented by counsel of its own choosing and with whom
counsel for the Indemnified Party shall confer in connection with the defense of
any such action, suit, or proceeding. The Indemnified Party shall make available
to the Indemnifying Party and its counsel and accountants, all books and records
of the Indemnified Party relating to such action, suit or proceeding and the
parties agree to render to each other such assistance as may reasonably be
requested in order to insure the proper and adequate defense of any such action,
suit or proceeding.
(E) Pursuant to the Purchase Price Escrow Agreement, upon receipt by
the Escrow Agent thereunder of the Bankruptcy Order, $70,000 from the Escrowed
Amount held thereunder (the "Indemnity Escrowed Amount") will be paid over and
held by the escrow agent listed on Exhibit A (the "Escrow Agent") in accordance
with the terms of an escrow agreement to be entered into between the parties
(the "Indemnity Escrow Agreement") on or prior to the Closing Date. The
Indemnity Escrowed Amount will be held in escrow by the Escrow Agent as security
for any indemnification obligation of the Company and/or the Shareholder to
Buyer pursuant to the terms of Article III, Xxxxxxx 0, Xxxxxxxxx (X) of this
Agreement. Indemnity claims by Buyer pursuant to said Paragraph (B) shall be
satisfied first by the reduction of the Indemnity Escrowed Amount until the
termination of the Indemnity Escrow Agreement and thereafter by the Company
and/or the Shareholder. The Indemnity Escrowed Amount does not constitute a
limit on the liability of the Company or the Shareholders to Buyer hereunder, it
being understood and agreed that the Company and the Shareholder shall, subject
to the limitation provided for in Xxxxxxx 0, Xxxxxxxxx (X) hereof, remain liable
to satisfy the amount of such claims which exceed the Indemnity Escrowed Amount.
Among other things, the Indemnity Escrow Agreement will provide that on the
first anniversary hereof, the Escrow Agent shall pay to the Company or its
designee such amount of the Indemnity Escrowed Amount then remaining, if any, as
has not previously been applied pursuant to the terms of said Escrow Agreement,
unless an indemnification claim by Buyer against the Company and/or the
Shareholder is then pending.
ARTICLE IV
CLOSING AND DELIVERIES AT CLOSING
Section 1. Closing. The closing of the purchase and sale of the
transaction contemplated herein shall take place on September 16, 1998 (the
"Closing"), at the offices of McCarthy, Fingar, Xxxxxxx, Xxxxxx & Xxxxx, L.L.P.,
Buyer's Counsel, located at 00 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxx Xxxxxx, XX
00000 at 10:00 a.m. or as otherwise mutually agreed upon
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by the parties. The deliveries described in Section 2 and 3 of this Article IV
will take place at the Closing.
Section 2. Deliveries by the Company and the Shareholder. On the
Closing Date, the Company and the Shareholder will deliver, or cause to be
delivered, to the Buyer the following:
(A) Such instruments of transfer or conveyance executed by the
Company, and the Shareholder where applicable, as Buyer may reasonably request
in order to convey and transfer to Buyer good and marketable title to all of the
Purchased Assets, free and clear of all liens, claims, encumbrances and other
charges, including, without limitation, a Xxxx of Sale.
(B) Physical delivery of all Tangible Assets by making them
available at the Sites listed on Exhibit A, together with any and all
warranties, manuals, instructions, and other literature in the possession of the
Company or the Shareholder relating to the ownership or operation of the
Tangible Assets. In addition, such notices to telephone companies and others
required to transfer the Company's telephone and facsimile numbers, e-mail
addresses and domain addresses, used or located in the Business to Buyer and
physical delivery of all books, files and records concerning the Purchased
Assets.
(C) Physical delivery of all original or certified copies of
documentation concerning the Intellectual Property, including, without
limitation, registrations and applications of any patents, trademarks or service
marks, original artwork, data bases, computer programs and software.
(D) The following corporate documentation:
(i) The Company's Articles or Certificate of Incorporation
certified as of a date within thirty (30) days prior to the Closing
Date by the Secretary of State of the state of the Company's
organization;
(ii) Good Standing Certificates as of date within thirty (30)
days prior to the Closing Date from the Secretary of State of the
state of the Company's organization and each other state in which
the Company is qualified to do business;
(iii) The Company's By-Laws certified as of the Closing Date
by the President or Secretary of the Company as being in full force
and effect and unmodified; and
(iv) Corporate Resolutions of the Company's Board of Directors
and the shareholders of the Company (if required by the Company's
By-Law's or applicable law), approving this Agreement and all the
transactions contemplated hereby, certified by the President or
Secretary of the Company as being in full force and effect and
unmodified.
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(E) The legal opinions of counsel to the Company and the
Shareholder, in a form acceptable to Buyer and its counsel.
(F) Evidence in form satisfactory to Buyer and its counsel that the
Tax Liabilities, if any, have been paid off and satisfied.
(G) The Purchase Price Escrow Agreement and the Indemnity Escrow
Agreement duly executed by the Company.
(H) Copies of written proof in form and substance satisfactory to
Buyer and its counsel that the Company will no longer do business under any of
the trade names listed on Exhibit B as required pursuant to Article I, Section
2, Paragraph (B) (iii) hereof.
(I) The Company and the Shareholder shall use their reasonable best
efforts to deliver a Non-Competition, Non-Disclosure and Intellectual Property
Agreement in a form to be provided by Buyer prior to the Closing, executed by
each employee of the Company who will be employed by Buyer or its affiliate
after the Closing.
(J) Notices of termination of all employees of the Company employed
in connection with Business satisfactory to Buyer, which notices will be
delivered to the employees concurrently with the Closing.
(K) Consulting Agreement between Parent and Xxxxxx Xxxxxxx (the
"Consulting Agreement"), executed by him
(L) Quitclaim conveyances executed by Network and IMA conveying to
Buyer any right, title and interest any of them may have in and to the Purchased
Assets in form and substance satisfactory to Buyer and its counsel.
(M) A Subscription Agreement duly executed by Xxxxxx Xxxxxxx and
Xxxxxx Karasy covering the issuance to them of 25,000 shares of common stock of
Parent (the "Common Stock") pursuant to the Consulting Agreement (the
"Subscription Agreement"), in the form to be provided by Parent.
(N) A Right of First Refusal Agreement duly executed by Xxxxxx
Xxxxxxx and Xxxxxx Karasy relating to the Common Stock (the "Right of First
Refusal Agreement"), in the form to be provided by Parent.
(O) Consent to a press release in form satisfactory to the Company
and Buyer relating to this Agreement and the transactions contemplated hereby.
(P) Such notice or notices as Buyer may reasonably request in order
to notify the customers included on the Customer List that the Business has been
sold to Buyer.
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Section 3. Deliveries by the Buyer.
On the Closing Date, the Buyer will deliver, or cause to be
delivered, to the Company and the Shareholders the following:
(A) The Down Payment, by certified or official bank check payable to
the order of the Company, or by wire transfer of federal funds to the account of
the Company, as the Company and Shareholder shall direct in writing on or before
the Closing Date.
(B) Such instruments of assignment and assumption executed by the
Buyer, as the parties hereto reasonably may determine necessary to effectuate
the assignment to the Buyer of the Business Agreements and the assumption by
Buyer of the Assumed Liabilities.
(C) The Purchase Price Escrow Agreement and the Indemnity Escrow
Agreement duly executed by the Buyer and the Escrow Agent.
(D) The Consulting Agreement executed by Parent.
(E) Resolution of the Board of Directors of Buyer, authorizing the
execution of this Agreement and the transactions contemplated hereby.
(F) The Subscription Agreement executed by Parent.
(G) The Right of First Refusal Agreement executed by Parent.
(H) A certificate issued by Parent to Xxxxxx Xxxxxxx and Xxxxxx
Karasy representing the shares of Common Stock agreed to be delivered pursuant
to the Consulting Agreement, which certificate shall be properly legended to
reflect that the Common Stock represented thereby has not been registered under
the Securities Act of 1933 as amended, and is subject to the terms of the Right
of First Refusal Agreement.
(I) Consent to a press release in form satisfactory to the Company
and Buyer relating to this Agreement and the transactions contemplated hereby.
ARTICLE V
OBLIGATIONS FOLLOWING CLOSING
Section 1. Further Cooperation. The Company and the Shareholder
will, at any time and from time to time after the Closing Date, execute and
deliver such further instruments of conveyance, transfer and license, and take
such additional actions as Buyer,
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Parent or its successor and/or assigns, may reasonably request, to effect,
consummate, confirm or evidence the transfer to Buyer of the Purchased Assets
pursuant to this Agreement.
Section 2. Transition Assistance and Adjustments.
(A) The Company shall reasonably cooperate and provide assistance to
the Buyer as shall be reasonably appropriate during the transition of the
Business and the Purchased Assets from the Company to the Buyer, or its
successors and/or assigns, after the Closing Date. All assistance shall be made
promptly when available after any request by Buyer. Buyer shall only reimburse
the Company for reasonable out-of-pocket expenses incurred in rendering such
assistance, but not for any time of any personnel.
(B) Buyer and its successors and/or assigns shall have the right at
any time and from time to time upon reasonable notice and during normal business
hours to examine and make copies of all corporate books, records and other
documents of the Company relating to the Business and generated prior to the
Closing Date, which documents will be maintained by the Company and the
Shareholder for a period of five (5) years after the Closing Date. The Company
and Shareholder shall reasonably cooperate and provide assistance in connection
with the preparation or revisions to and audits of the financial statements of
the Company conducted by Buyer after the Closing, including, without limitation,
making Company's internal accounting and auditing personnel, as well as its
external accounting personnel, available to Buyer, its affiliate and/or its
auditors upon request.
(C) The Company and the Shareholder will reasonably cooperate with
Buyer in notifying the customers included on the Customer List that the Business
has been sold to Buyer, including, without limitation, executing any additional
notices which Buyer may reasonably request. Neither the Company nor the
Shareholder will, directly or indirectly, take any action which is designed or
intended to have the effect of discouraging customers, suppliers or vendors and
other business associates of the Business, from maintaining the same business
relationships with Buyer or its successors and/or assigns after the Closing Date
as were maintained with the Company and/or the Shareholder with respect to the
Business prior to the Closing Date.
(D) The Buyer and/or its Parent shall have the right to use the
Company's existing facility at the Site listed on Exhibit C-3, for a period from
the Closing Date up to October 31, 1998, to operate and maintain the Business.
Buyer shall reimburse the Company, within 10 days of the receipt by Buyer of an
appropriate invoice, in an amount equal to the rent and additional operating
expenses paid by the Company for said facility during the period of such use
which the parties acknowledge to be approximately $21,000; consisting of $9,000
in rent, $9,000 in connectivity charges and $3,000 in electric charges.
Additionally, the Buyer or its Parent shall be billed by the Company for any
direct telephone charges allocable to Buyer's or Parent's use of telephones at
the site during said period of use as well as any unforeseen reasonable
operating expenses approved by Buyer.
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(E) Following the Closing, the Company and the Shareholder or any
affiliate of the Company (as defined under federal securities laws), shall not
use the name "GEN International" or any confusingly similar name to said trade
name in any trade or business, other than as an employee of Buyer or an
affiliate of Buyer.
ARTICLE VI
MISCELLANEOUS
Section 1. Governing Law; Jurisdiction. This Agreement shall be
governed by the laws of the State of New York. The parties hereto submit and
consent to the exclusive jurisdiction of the state courts of the State of New
York in the Counties of New York and/or Westchester and the federal courts
located therein with respect to any legal actions relating to this Agreement, or
any other agreements delivered in connection herewith, between the Company
and/or the Shareholder, on the one hand, and the Buyer and/or Parent, on the
other hand, and any transactions contemplated thereby.
Section 2. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.
Section 3. Confidentiality. The Company and the Shareholder, on the
one hand, and the Buyer, on the other hand, each agree not to disclose or use
any information acquired by it about the other party during the course of the
negotiations of this Agreement and the transactions to which it relates which is
confidential in nature or not otherwise generally available to the public
without the prior written consent of such other party unless required to do so
by applicable law or by order of a court of competent jurisdiction.
Section 4. Entire Agreement; Amendments. This Agreement supersedes
any prior discussions and agreements relating to the subject matter hereof
between the Buyer, Parent, the Company and the Shareholders, and this Agreement
contains the sole and entire agreement among the parties with respect to the
matters covered hereby. This Agreement cannot be changed, modified or amended
and no provision or requirement hereof may be waived without the consent in
writing of the parties hereto.
Section 5. Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect. Each provision of this Agreement shall be deemed to be the agreement of
the parties hereto to the full extent that the power to enter into such
provisions shall have been conferred on the parties by law.
Section 6. Benefit; Assignment. This Agreement is binding upon and
inures to the benefit of the parties, their successors and permitted assigns.
This Agreement may not be
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assigned or the duties of the parties hereunder delegated to others without the
prior written consent of all parties hereto, except that Buyer may assign its
rights, duties and obligations hereunder to Parent or an affiliate of Buyer or
Parent without the Company's or the Shareholders' consent.
Section 7. Construction. All exhibits annexed hereto are hereby
incorporated herein by reference and made a part of this Agreement. Whenever
used in this Agreement and the context so requires, the singular shall include
the plural and the plural shall include the singular.
Section 8. Imputed Knowledge. Anywhere in this Agreement where it
refers to the "knowledge of" the Company, or words of similar import, the
knowledge of the Shareholder and the officers and directors of the Company shall
be imputed to be the knowledge of the Company. Anywhere in this Agreement where
it refers to the "knowledge of" the Buyer or the Parent, or words of similar
import, the knowledge of Xxxxxxx X. Xxxxxxx shall be imputed to be the knowledge
of the Buyer and the Parent, respectively.
Section 9. Notices. All notices, requests, demands, claims, and
other communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if (and then
two business days after) it is sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed to the intended recipient as
set forth below:
If to the Company: GEN International, Inc.
0000 000xx X. Xxxxxx Xxxx, Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx
Copy to:
Xxxxxx X. XxXxxxxx, Esq.
2909 Bay to Xxx Xxxx., Xxxxx 000
Xxxxx, Xxxxxxx 00000
If to the Buyer: Sage Networks Acquisition Corp.
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Copy to:
Xxxxx X. Xxxxx, V.P. and General Counsel
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
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and
McCarthy, Fingar, Xxxxxxx, Xxxxxx & Xxxxx, L.L.P.
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxx, Esq.
Any Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, telex, ordinary mail, or electronic mail), but no such notice,
request, demand, claim, or other communication shall be deemed to have been duly
given unless and until it actually is received by the intended recipient. Any
Party may change the address to which notices, requests, demands, claims, and
other communications hereunder are to be delivered by giving the other Party
notice in the manner herein set forth.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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[SIGNATURE PAGE OF ASSET PURCHASE AGREEMENT BETWEEN SAGE
NETWORKS ACQUISITION CORP. AND GEN INTERNATIONAL, INC. DATED
SEPTEMBER 16, 1998]
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
SAGE NETWORKS ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxx, President
GEN INTERNATIONAL, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------------
Xxxxxx Xxxxxxx, Chief Executive
Officer and Vice-President
SHAREHOLDER:
/s/ Xxxxxx Xxxxxxx
-----------------------------------
Xxxxxx Xxxxxxx
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DESCRIPTION OF EXHIBITS:
Exhibit A -- Basic Provisions
Exhibit B -- Ownership of Capital Stock of the Company; Description of Capital
Stock; Officers; Directors; Trade Names; Jurisdictions
Exhibit C-1 -- Forms of Business Agreements with Customers
Exhibit C-2 -- Summary of Oral Business Agreements and Vendor/Service Provider
and Other Agreements
Exhibit C-3 -- Leases
Exhibit C-4 -- Claims of Disputes Under Business Agreements
Exhibit C-5 -- Consents to Transfer or Assign Not Obtained
Exhibit D -- [INTENTIONALLY DELETED]
Exhibit E -- Tangible Assets
Exhibit F -- Intellectual Property
Exhibit G -- Customer List and Related Information
Exhibit G-1 -- Customer Terminations
Exhibit H -- Financial Statements
Exhibit I -- Bad Debts and Tax Liabilities of the Company
Exhibit J -- Assumed Liabilities
Exhibit K -- Existing Employment Agreements, Labor or Collective Bargaining
Agreements, Employee Benefit or Welfare Plans, Description of
Employees
Exhibit L -- Excluded Assets
Exhibit M -- Liens; Encumbrances
In accordance with Item 601(b)(2) of Regulation S-K all exhibits other than
Exhibit A have been omitted. The Company hereby agrees to furnish supplementally
a copy of any omitted exhibit to the Commission upon request.
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EXHIBIT A
TO
ASSET PURCHASE AGREEMENT
BETWEEN
SAGE NETWORKS ACQUISITION CORP.
AND
GEN INTERNATIONAL, INC.
BASIC PROVISIONS
1. Name of Buyer: Sage Networks Acquisition Corp.
2. Names of Companies and Jurisdictions of Incorporation:
Jurisdiction of
Company Incorporation Offices
------- --------------- -------
a) GEN International, Inc. (the "Company") Florida 1000 000 X. Xxxxxx Xx.
Xxxxx 000
Xx. Xxxxxxxxxx, XX 00000
b) Global Entrepreneurs Network, Inc. Florida 1000 000 X. Xxxxxx Xx.
Xxxxx 000
Xx. Xxxxxxxxxx, XX 00000
c) Gen Network Operations Center, Inc. Florida N/A
d) International Management Agency, Inc. Florida 000 X. Xxxxx Xx.
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
3. Authorized Officers of the Company:
a) Xxxxxx Xxxxxxx; Director, CEO, Vice-President and Treasurer
b) Xxxxx XxXxxx; Director, President and COO
24
EXHIBIT A (CONTINUED)
4. MAJORITY SHAREHOLDER OF THE COMPANY:
a) Virtual Ventures, Ltd. owns 24,100,000 shares
b) Address: 0-0 Xxx Xxxx Xxxxxx, Xxxxx 0-X
Xxxxxx, X0X0XX
XX
5. TOTAL AUTHORIZED SHARES OF THE COMPANY:
a) 50,000,000 shares of Common stock (no par value)
b) 10,000,000 shares of Preferred Stock--Series A Convertible
(non-voting)(no par value)
6. TOTAL OUTSTANDING SHARES OF THE COMPANY:
a) 37,589,706 shares of common stock
b) 175,000 shares of Preferred Stock (non-voting)
7. PURCHASE PRICE: $455,000
8. COMPANY AND SHAREHOLDER'S BROKER--None
9. BUYER'S BROKER: Am-Tech Associates
10. ESCROW AGENT: McCarthy, Fingar, Xxxxxxx, Xxxxxx & Xxxxx, L.L.P.
Attorneys for Buyer
00 Xxxxxxx Xxx.
Xxxxx Xxxxxx, XX 00000
