EXHIBIT 2.2 & 10.2
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement is entered into as of February 10, 2005
by and between The Liquid Consulting Group, Inc., a New York corporation,
("SELLER"), The Liquid Group, Inc. (formerly BDR Xxxxxxxxx, Inc), a Nevada
corporation ("BUYER") and XXXXX XXXXXXX ("POJUNIS").
RECITALS
A. Seller distributes financial products and services including, but
not limited to Investor Relations and Public Relations services (the
"BUSINESS").
B. Buyer wishes to purchase from Seller, and Seller wishes to sell
to Buyer, all of Seller's assets and rights related to the Business.
C. Pojunis is the sole shareholder, officer and director of Seller.
AGREEMENT
In consideration of the mutual agreements, representations and
warranties in this Agreement, the parties agree as follows:
1. Purchase and Sale of Assets
Buyer hereby purchases from Seller, and Seller hereby sells, conveys,
transfers and assigns to Buyer, all of Seller's assets and rights relating
to the Business, the assets included in Section 2 below (the "ASSETS"),
including (without limitation) the Seller's right, titles and interests in
and to the following:
(a) Seller's rights under leases of equipment and licenses of
intellectual property rights presently used in the Business, and under
other agreements with vendors, customers and other third parties (the
"Assumed Agreements"), including (without limitation) its rights and
receivables under agreements with customers relating to Seller's past
sales, Seller's accounts receivable related to the Assets from past sales
of goods or services, and Seller's rights under other agreements listed on
attached SCHEDULE 1(a);
(b) Seller's computer hardware (excluding the personal computer of
Pojunis), and computer data (including all data on the personal computer of
Pojunis), peripherals and accessories, phone system, other equipment,
tools, signs, furniture, fixtures, leasehold improvements, written
marketing materials, inventory and other tangible assets used in or related
to the Business, including (without limitation) the items listed on
attached SCHEDULE 1(b);
(c) Seller's corporate name and all other computer software,
copyrights, customer lists, domain names, URL addresses, fictitious
business names, trade names, trademarks, service marks, telephone numbers,
transferable permits and licenses, goodwill and other intellectual property
rights and intangible assets used in or related to the Business, including
(without limitation) the items and rights listed on attached SCHEDULE 1(c);
(d) All assignable warranties, indemnification and similar rights
against the manufacturers or sellers of Seller's assets relating to the
future use and performance of such assets; and
(e) All books, records, data, information and documents relating to
the Assets.
2. Excluded Assets
The following assets and items shall be retained by Seller and are not
included in the Assets (the "EXCLUDED ASSETS"):
(a) Seller's cash;
(b) Seller's bank accounts;
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(c) Seller's rights under (i) any agreements not listed on SCHEDULE
1(a) between Seller and Pojunis, Seller's employees or any third parties
controlled by any such person(s), (ii) Seller's real property lease, (iii)
Seller's banking or loan agreements with any banks or other lenders, (iv)
Seller's agreements with customers, financial institutions or other parties
in connection with Seller's past sales and distribution of Mastercards, and
(iv) any other agreements of Seller which are listed on attached SCHEDULE 2
(together, the "EXCLUDED AGREEMENTS");
(d) The corporate seal, minute books, stock books and other records
having to do solely with the organization and ownership of Seller; and
(e) any other assets listed on attached SCHEDULE 2.
3. PURCHASE CONSIDERATION
3.1 In addition to its assumptions under Section 3 above, Buyer
agrees to pay to Seller for the Assets and Seller's obligations under this
Agreement the following:
(a) the cash sum of Ten Thousand Dollars ($10,000.00), which is
being paid to Seller concurrently with the execution of The Liquid Group
..20 Offering escrow being exercised in addition to execution and delivery
of this Agreement;
(b) TWO HUNDRED FIFTY THOUSAND (250,000) shares of Buyer's
Common Stock, which are being issued to Pojunis on the date of this
Agreement;
(c) TWO HUNDRED FIFTY THOUSAND (250,000) shares of Buyer's
Common Stock, which will be issued to Pojunis six months (6) months after
the date of this Agreement on September 31, 2005; and
3.2 Concurrently with the execution and delivery of this Agreement,
Pojunis has signed and entered into a Stock Acquisition Agreement with
Buyer, which is attached to this Agreement as EXHIBIT B-1 (the "Stock
Acquisition Agreement"), and Buyer has delivered to Pojunis the
certificates for the shares of Buyer's Common Stock which they are entitled
to receive under Section 3.1 (b). The certificate for the Common Stock to
be issued to Pojunis under Section 3.1(c) shall be delivered to him six
months after the date of this Agreement.
3.3 The purchase consideration shall be allocated among the Assets as
set forth on attached SCHEDULE 3.3.
4. SELLER'S AND POJUNIS'S WARRANTIES AND AGREEMENTS
Seller and Pojunis represent, warrant and agree to and with Buyer as
follows:
4.1 Seller is a corporation duly organized, validly existing and in
good standing under the laws of the State of New York and has taken all
corporate actions necessary to authorize the execution and performance of
this Agreement. This Agreement constitutes the legal, valid and binding
obligation of Seller, enforceable in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization
or similar laws or equitable principles relating to or limiting the rights
of creditors generally. Seller's execution and performance of this
Agreement will not violate or constitute a default, or a condition that, if
continued, with the passage of time or notice would constitute a default,
under any agreement to which Seller is a party, or constitute a fraudulent
conveyance or fraudulent transfer under or violate any statute or law or
any judgment, decree, order, regulation or rule of any court or
governmental entity to which Seller is subject. No authorization or
approval of, or filing with, any governmental, regulatory or administrative
body is required in connection with the execution and delivery by Seller of
this Agreement. Pojunis is the sole shareholder, director and officer of
Seller.
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4.2 The Employment Agreement between Pojunis and Seller being entered
into concurrently with the execution and delivery of this Agreement, which
is attached to this Agreement as EXHIBIT C (the "EMPLOYMENT AGREEMENT"),
and the Stock Acquisition Agreement constitutes the legal, valid and
binding obligations of Pojunis, enforceable in accordance with their
respective terms, except as such enforcement may be limited by bankruptcy,
insolvency, reorganization or similar laws or equitable principles relating
to or limiting the rights of creditors generally. Pojunis's execution and
performance of those agreements will not violate or constitute a default,
or a condition that, if continued, with the passage of time or notice would
constitute a default, under any agreement to which Seller is a party, or
constitute a fraudulent conveyance or fraudulent transfer under or violate
any statute or law or any judgment, decree, order, regulation or rule of
any court or governmental entity to which Pojunis is subject. No
authorization or approval of, or filing with, any governmental, regulatory
or administrative body is required in connection with the execution and
delivery by Seller of those agreements.
4.3 The Assets, except for the Excluded Assets, consist of all the
non-cash properties, agreements and rights necessary for Buyer to continue
Seller's Business in the same manner as it has been conducted by Seller
prior to the date of this Agreement.
4.4 SCHEDULE 1(a) accurately lists all of the material agreements
relating to the Assets, to which Seller is a party, except for the Excluded
Agreements. Seller has provided to Buyer copies of all such agreements
which are written and written descriptions of the material terms of all
such agreements which are oral. Except as set forth in Schedule 1(a),
neither Seller nor another party is in material violation of or default
under, nor is there any existing condition that, if continued, with the
passage of time or notice would constitute a material default by Seller or
another party under, any such agreement. No consent of any other party or
person is required, which has not been received by Seller, is required for
the transfer to Buyer of any rights or obligations under any such
agreement.
4.5 Neither Seller nor Pojunis: (i) is a party to or bound by or
subject to any agreement or instrument, or any judgment, order or decree of
any court or governmental agency or authority, which is violated by, or
materially impairs, the carrying out of this Agreement, the Stock
Acquisition Agreement or the Employment Agreement (together, the
"AGREEMENTS"); or (ii) is a party to any pending, or knows of any
threatened, action, suit, proceeding or investigation in, before or by any
court, governmental agency or authority or arbitrator which may have a
material adverse effect on the Agreements, the Assets or the Business.
4.6 Seller is conveying to Buyer good and marketable title to all the
Assets, free and clear of all liens, claims, security interests or
encumbrances ("Liens").
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4.7 SCHEDULE 1(b) accurately lists all of the material tangible
Assets, and SCHEDULE 1(c) accurately lists all of the material intangible
Assets, being purchased by Buyer.
4.8 To the best knowledge of Pojunis, there are no liabilities of
Seller, whether accrued, absolute, contingent or otherwise, which arose or
relate to any action or transaction of Seller occurring before the
execution of this Agreement, which have not been disclosed by Seller and
Pojunis and which in the aggregate have or reasonably could be expected to
have a material adverse effect on the Business or the Assets (if they
continued to be conducted and owned by Seller). Seller is not insolvent,
its liabilities do not exceed its assets, it is paying its debts as they
come due and the transactions contemplated by this Agreement will not cause
insolvency of Seller or the Business.
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4.9 SCHEDULE 4.9 to this Agreement lists all of the patents, patent
applications, copyrights, trademarks, service marks, names and internet
domain names that are presently used by Seller in connection with the
Business, and the present U.S. registration status of each of them. As
used in this Section 4.9, "INTELLECTUAL PROPERTY" means patents and patent
applications, trade secrets, copyrights, microcode, designs, maskworks,
technology, inventions, technical data, computer programs, trademarks,
service marks, trade names, internet domain names, business techniques and
other intellectual property rights and applications therefore. Except as
set forth in EXHIBIT D, SCHEDULE 1(c) OR SCHEDULE 4.9: (a) Seller has
received no notice, and Seller is not aware, that Seller's activities or
any of the Intellectual Property owned or used by Seller has infringed or
violated any Intellectual Property right of any third party; (b) to the
best of Seller's knowledge, Seller owns or is entitled to use all of the
Intellectual Property required for the present conduct of its Business; (c)
Seller's entering into of this Agreement does not cause any of Seller's
Intellectual Property to be lost or reduced; (d) Buyer may continue to use
Seller's Intellectual Property in the future in the same manner as it has
been used by Seller, except for any expirations of Assumed Agreements or
registered Intellectual Property in accordance with their terms; (e) Seller
has not licensed, leased or used any material Intellectual Property owned
by other Persons, (f) other than in the ordinary course of the Business,
Seller has not transferred, licensed or leased to any third party any of
its Intellectual Property; (g) Seller is not aware of any infringement or
unauthorized use by others of Seller's Intellectual Property; (h) Seller
has entered into an appropriate and effective confidentiality and
technology assignment agreement with each of its past and current
employees, and with each independent contractor who has provided services
relating to Seller's development or modification of its Intellectual
Property, copies of which have been provided to Buyer, and, (i) under their
agreements with Seller or applicable laws, all of the Intellectual Property
developed or generated by Seller's past and present employees and
individual independent contractors in the course of their providing
services to Seller have become the sole property of Seller.
4.10 Within the times and in the manner prescribed by law, Seller has
filed all national, state and local tax returns and filings required by
applicable tax laws and Seller has paid and withheld all income,
employment, property, sales and other taxes (including estimated taxes),
unemployment and disability compensation insurance contributions,
assessments and penalties due and payable or required to be withheld by
Seller[, except that Seller has not filed its income tax returns for its
fiscal year ending December 31, 2003]..
4.11 Seller has complied in all material respects with all laws,
statutes and regulations applicable to the Business or the Assets, and
there exists no condition or event which with notice, lapse of time or both
would constitute a material violation by Seller of such laws, statutes or
regulations.
4.12 Except as set forth in SCHEDULE 4.12, neither Seller nor Pojunis
is a party to any current lawsuit, arbitration, governmental or regulatory
investigation or other legal proceeding and, to the best knowledge of
Pojunis, no such lawsuit, arbitration, investigation or proceeding against
him or Seller has been threatened.
4.13 Neither Seller nor any person acting on behalf of Seller has
employed any broker, agent or finder or incurred any liability or
obligation for any brokerage fees, agent's commissions, finder's fees or
similar payments in connection with the transactions related to this
Agreement. Seller and Pojunis agree to indemnify, defend and hold harmless
Buyer against any and all Adverse Consequences (as defined in Section 9.1)
that Buyer may suffer or incur on account of the representations in this
paragraph being inaccurate.
4.14 No representation or warranty of Seller or Pojunis contained in
this Agreement, nor any other schedule, document, certificate or statement
furnished to Buyer by or on behalf of Seller pursuant to or in connection
with this Agreement, contains or will contain any untrue statement of a
material fact or omits or will omit a material fact necessary in order to
make the other statements contained therein or in this Agreement not
misleading.
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6. BUYER'S WARRANTIES AND AGREEMENTS
Buyer represents warrants and agrees to and with Seller and Pojunis as
follows.
6.1 Buyer is a corporation duly organized, validly existing and in
good standing under the laws of the State of Nevada and has taken all
corporate actions necessary to authorize the execution and performance of
this Agreement. Each of the Agreements constitutes the legal, valid and
binding obligation of Buyer, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or similar laws or equitable principles relating to or
limiting the rights of creditors generally. Buyer's execution and
performance of the Agreements will not violate or constitute a default, or
a condition that, if continued, with the passage of time or notice would
constitute a default, under any agreement to which Buyer is a party, or
constitute a fraudulent conveyance or fraudulent transfer under or violate
any statute or law or any judgment, decree, order, regulation or rule of
any court or governmental entity to which Buyer is subject. No
authorization or approval of, or filing with, any governmental, regulatory
or administrative body is required in connection with the execution and
delivery of the Agreements by Buyer, except for any filings required under
federal or state securities or tax laws.
6.2 Buyer (i) is not a party to or bound by or subject to any
agreement or instrument, or any judgment, order, or decree of any court or
governmental agency or authority, which is violated by, or could materially
impairs, the carrying out of the Agreements; and (ii) is not a party to any
pending, and does not know of any threatened, action, suit, proceeding or
investigation in, before or by any court, governmental agency or authority
or arbitrator which may have a material adverse effect on the Agreements.
6.3 Neither Buyer nor any person acting on behalf of Buyer has
employed any broker, agent or finder or incurred any liability or
obligation for any brokerage fees, agent's commissions, finder's fees or
similar payments in connection with the transactions related to this
Agreement.
6.4 No representation or warranty of Buyer contained in this
Agreement, nor any other schedule, document, certificate or statement
furnished to Seller by or on behalf of Buyer pursuant to or in connection
with this Agreement, contains or will contain any untrue statement of a
material fact or omits or will omit a material fact necessary in order to
make the other statements contained therein or in this Agreement not
misleading.
7. CONSENTS TO TRANSFERS OF AGREEMENTS
If any of the agreements that would otherwise be an Assumed Agreement
is not assignable or may not be transferred without the consent of another
party to the agreement, this Agreement shall not constitute an assignment
of or attempt to assign such agreement if the failure to obtain such
consent would materially and adversely affect the rights of Buyer or
materially increase the liabilities of Buyer related to such agreement.
But the parties shall cooperate and use reasonable efforts to obtain any
such required consent of another party to an agreement. If no such consent
is obtained, Seller will cooperate with Buyer in any commercially
reasonable arrangements designed to provide to Buyer the benefits under any
such agreement including enforcement for the account of Buyer of any rights
of Seller under or related to such agreement. In such a case, Buyer may
perform the obligations with respect to such agreement for and on behalf of
Seller but for the account and benefit of Buyer and Seller shall hold the
benefits and privileges of such agreement arising after the date of this
Agreement in trust for Buyer.
8. ADDITIONAL AGREEMENTS
8.1 Seller shall cease using any trademarks and names included in the
Assets and shall immediately change its corporate name to exclude any such
or similar marks or names.
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8.2 Seller shall be permitted to retain copies of any and all records
and documents deemed reasonably necessary by Seller to prepare tax returns
and financial statements, and to respond to governmental authorities or
other third parties, so long as Seller maintains the confidentiality of
such items. Seller shall have the right of access to and the right to
copy, at Sellers' expense, any records copies of which are not retained by
Seller, for the sole purpose of responding to inquiries, audits,
examinations or litigation initiated by tax authorities, other governmental
authorities or other third parties.
8.3 While Buyer has agreed to retain Pojunis as an employee under the
Employment Agreement, Seller will continue, subject to Section 4.1(f), to
be liable for and will indemnify Buyer against all compensation and other
benefits owed to Seller's employees on account of their employment by
Seller or any termination of their employment in connection with the sale
of the Assets to Buyer. Pojunis is entering into a Proprietary Information
and Inventions Assignment Agreement in the form attached to this Agreement
as EXHIBIT E.
8.4 In the event that any amount is owed to Buyer by Seller or
Pojunis under this Agreement, or the exhibits to this Agreement, but
excluding the Employment Agreement, including (without limitation) as
damages for any breach or misrepresentation by Seller under this Agreement
or as an indemnification obligation under Section 9 (an "OWED AMOUNT"),
Buyer shall have the right to:
(a) offset or credit all or a portion of the Owed Amount, not in
excess of the total Owed Amount less the portions thereof separately taken
into account under Sections 8.4 and 8.4(b) above, and thereby satisfy or
reduce, any amounts owed by Buyer to Seller or Pojunis under the Agreements
or otherwise.
Buyer shall give Seller written notice of any such offset.
9. INDEMNIFICATION
9.1 Seller and Pojunis agree to indemnify, defend and hold harmless
Buyer against any and all actions, suits, proceedings, investigations,
charges, complaints, claims, demands, injunctions, judgments, orders,
rulings, penalties, fees, losses, damages, injuries, obligations and
liabilities, including but not limited to interest, penalties and
reasonable attorney's fees ("Adverse Consequences"), that Buyer may suffer
or incur by reason of a third party claim, demand, action, suit or charge
seeking damages or other remedies or compensation (a "Claim") based on or
resulting from: (a) any inaccuracy or breach of a representation, warranty
or covenant made by Seller or Pojunis in or pursuant to this Agreement; or
the exhibits to this Agreement, or (b) the Assets..
9.2 Buyer agrees to indemnify, defend and hold harmless Seller and
Pojunis against any and all Adverse Consequences that Seller or Pojunis may
suffer or incur by reason of a third party Claim based on or resulting from
any inaccuracy or breach of a representation or covenant made by Buyer in
or pursuant to this Agreement.
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9.3 A party entitled to indemnification under this Section 9 on
account of a third party Claim to which an indemnifying party's obligations
under this Section 9 would apply shall promptly notify the indemnifying
party of the existence of the Claim; provided, however, that the failure
promptly to give such notice shall not excuse or limit the indemnifying
party's obligation to indemnify the indemnified party, except to the extent
that the indemnifying party suffers damage or prejudice by reason of the
indemnified party's failure to give or delay in giving such notice.
Notwithstanding the foregoing, an indemnifying party's obligations under
this Section 9 relating to a Claim shall only apply if such notice relating
to that Claim is given to such party within four (4) years after the date
of this Agreement. Within a reasonable time after it or he receives such
notice, the indemnifying party will have the right and obligation to assume
and thereafter conduct the defense of such Claim at its or his expense,
with counsel of its or his choice reasonably satisfactory to the
indemnified party; provided, however, that the indemnified party will at
all times have the right fully to participate in the defense at its or his
own expense and the indemnifying party will not consent to the entry of any
judgment or enter into any settlement with respect to such Claim without
the prior written consent of the indemnified party (which shall not to be
withheld unreasonably) unless the judgment or proposed settlement involves
only the payment of money damages by the indemnifying party and does not
impose an injunction or other equitable relief upon the indemnified party.
If the indemnifying party, within a reasonable time after receiving such a
notice, should fail to defend against the Claim, the indemnified party will
have the right, but not the obligation, to undertake the defense of, and to
compromise or settle (exercising reasonable business judgment), the Claim
on behalf of and at the risk of the indemnifying party. The
indemnification provisions in this Section 9 are in addition to, and not in
derogation of, any statutory, equitable or common law remedy any party may
have for breach of a representation, warranty or covenant.
10. MISCELLANEOUS PROVISIONS
10.1 This Agreement will be governed by the laws of the State of
Nevada.
10.2 This Agreement contains the entire agreement among the parties,
and supersedes all prior agreements, representations and understandings of
the parties, relating to the subject matter of this Agreement.
10.3 Each party agrees that after the delivery of this Agreement it or
he will execute and deliver such further documents and do such further acts
and things as the other party may reasonably request in order to carry out
the terms of this Agreement.
10.4 No supplement to or amendment of this Agreement will be binding
unless executed in writing by Buyer, Seller and Pojunis.
10.5 Subject to the terms of the Stock Acquisition Agreement, this
Agreement will be binding on, and will inure to the benefit of, the parties
and their respective successors and assigns, and shall not confer any
rights or remedies on any others. No party may assign its or his rights or
obligations under this Agreement, except with the other parties' written
consent.
10.6 This Agreement may be executed in one or more counterparts, each
of which will be deemed a valid, original agreement, but all of which
together will constitute one and the same instrument.
10.7 If any provision of this Agreement or its application to any
person or circumstances is held to be unenforceable or invalid by any court
of competent jurisdiction, its other applications and the remaining
provisions of this Agreement will be interpreted so as best reasonably to
effect the intent of the parties.
10.8 Each party will pay its or his own legal fees and other expenses
in connection with the preparation of this Agreement and the sale of Assets
in accordance with this Agreement. However, if any legal action or other
proceeding is brought for the enforcement of this Agreement, or because or
arising out of an alleged dispute, breach, default or misrepresentation in
connection with any of the provisions of this Agreement, the prevailing
party will be entitled to recover reasonable attorneys fees and other costs
incurred in that action or proceeding, in addition to any other relief to
which it or he may be entitled.
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10.9 Any notice or other communication to a party pursuant to this
Agreement will be deemed to have been duly given if given personally to the
party or on the date of delivery in writing, addressed to the party, at the
following address:
If to Buyer: The Liquid Group, Inc.
0000 Xxxxxxxx Xxxx #00000
Xxx Xxxxx, XX 00000
With a copy to: Xxx Xxxxx, Esq.
00 Xxxx 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
If to Seller or Pojunis:
10.10 With respect to words used in this Agreement, the singular
form shall include the plural form, the masculine gender shall include the
feminine or neuter gender, and vice versa, as the context requires.
10.11 Any rule of law or legal decision that would require
interpretation against the drafter of this Agreement is not applicable and
is waived.
10.12 Any provision of this Agreement may be waived at any time by
the party entitled to the benefit thereof by a written instrument executed
by the party or by a duly authorized officer of the party. No waiver of
any of the provisions of this Agreement will be deemed, or will constitute,
a waiver of any other provision, whether or not similar, nor will any
waiver constitute a continuing waiver.
EXECUTION
Seller, Buyer and Pojunis have executed and delivered this Agreement
in Las Vegas, Nevada as of the date set forth in the first paragraph of
this Agreement.
/s/ Xxxxx Xxxxxxx
-------------------------------------
Xxxxx Xxxxxxx
THE LIQUID CONSULTING GROUP,
a New York corporation
By /s/ Xxxxx Xxxxxxx
-------------------------------------
Signature
Xxxxx Xxxxxxx
-------------------------------------
Printed Name
Chairman/CEO
-------------------------------------
Title
THE LIQUID GROUP, INC.,
a Nevada corporation
By /s/ Xxxxx Xxxxxxx
-------------------------------------
Signature
Xxxxx Xxxxxxx
-------------------------------------
Printed Name
President
-------------------------------------
Title
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THE FOLLOWING SCHEDULES ARE TO BE INCLUDED AS AN ATTACHMENT TO THE ASSET
PURCHASE AGREEMENT DATED FEBRUARY 10, 2005:
Schedule 1(a)
Generex Warrants not included
Schedule 1(b)
Information loaded on the hard drive
Printer Konica Minolta Magicolor 2350
Printed Brochures
Schedule 1(c)
The following Domain names are to be included in the agreement:
xxx.xxxxxxxxxxxxxx.xxx
xxx.xxxxxxxxxxxxx.xxx
The files (.fla, html, and .swf) for the completed website
Trade names The Liquid Group
Logo is attached
Information loaded on external hard drive
Contacts Folder
Investment Professional leads
Individual Investor Leads
Liquid Email addresses
Sales Folder
List of pitches to different
organizations/individuals
List of Sales letters
The Liquid Group Marketing Information
(Templates) Folder
Brochure Templates
Newsletter Templates
Business Card Templates
Letter head
Logos and alternative logos
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