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EXHIBIT 10.2
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (the "Agreement") is entered into
effective this 31st day of July, 1996 by and between INTERNET AMERICA, INC., a
Texas corporation ("Buyer"), and WEBSTAR, INC., a Texas corporation ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is in the business of providing dial-up internet
access services and related services to customers, both individuals and
businesses, in the San Angelo, Texas market (the "Business"); and
WHEREAS, the parties hereto desire to enter into this Agreement for
the purchase of the Business and to establish the parties ongoing business
relationship regarding other matters.
NOW, THEREFORE, for and in consideration of the mutual understandings,
promises and covenants contained herein, the parties hereto agree as follows:
1. TERMS OF PURCHASE AND SALE; CLOSING.
1.1 Purchase and Sale of Certain Assets of the Seller. Upon the
basis of the representations and warranties and subject to the terms and
conditions of this Agreement, Buyer agrees to purchase and acquire from Seller,
and Seller agrees to sell, convey, transfer, assign, and deliver to Buyer, on
the Closing Date (as defined in Section 1.5 hereto) the Assets, free and clear
of any pledge, lien, claim or other encumbrance of any kind whatsoever, except
for those obligations as described in Section 1.1(b) below, against receipt on
the Closing Date of the Purchase Price specified in Section 1.4 hereof. The term
"Assets" shall mean all of the assets of the Seller relating to the Business
including but not limited to:
(a) All of Seller's rights, title and interest in and to
those certain tangible assets and property as set forth on Schedule 1.1(a) (the
"Fixed Assets"); and
(b) All of Seller's rights, title and interest in Lease
Agreements as set forth in Schedule 1.1(b), providing each named Lessor agrees
to the assumption by Buyer; and
(c) All of Seller's cash accounts, accounts receivable,
billing receipts and collections systems, deposits; and
(d) All of Seller's rights, title and interest in and to
all of Seller's customers as of the effective date of this agreement, customer
lists, all goodwill associated therewith (the "Customers"); and
(e) All of Seller's existing marketing and promotional
materials.
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1.2 H & H Liabilities. Buyer shall not assume any liabilities,
incurred by Seller, to H & H Consulting (related party of Seller).
1.3 Purchase Price. The purchase price (the "Purchase Price") for
the Assets shall be cash in the amount of $8,000.00 and the issuance and
delivery by Buyer of its promissory note in the original principal amount of
$352,125.00 (the "Note"), such Note to be substantially in the form attached
hereto as Exhibit "A".
1.4 Instruments of Transfer and Conveyance.
(a) The sale, conveyance, transfer, assignment and
delivery of the Assets, as herein provided, shall be effected by delivery by
Seller on the Closing Date of such bills of sale, endorsements, assignments,
certificates, drafts, checks or other instruments of transfer and conveyance,
as Buyer shall reasonably deem necessary, to vest in Seller good and marketable
title to the Assets. Except for those obligations as described in Section
1.1(b) above, such instruments of transfer and conveyance shall contain
warranties as to marketable title and that such Assets are free and clear of
all pledges, liens, options, security interests, mortgages, claims, charges or
other encumbrances of any kind whatsoever.
(b) Seller agrees that it will from time to time after
the Closing Date, upon the request of Buyer, promptly do, execute, acknowledge
and deliver, and will cause to be done, executed, acknowledged and delivered,
all such further instruments, certificates, assignments, transfers,
conveyances, powers of attorney, assurances and other documents, as may be
reasonably necessary or advisable to assure or confirm Buyer's free and clear
title to and interest in, or to enable Buyer to deal with and dispose of, any
of the Assets.
1.5 Closing. The closing hereunder (the "Closing") shall be held
at the offices of the Buyer as of the effective date of this Agreement, or at
such other time and place as the parties may agree upon (the "Closing Date").
At the Closing:
(a) Seller will execute and deliver to Buyer the
following: a General Xxxx of Sale and Conveyance in the form acceptable to
Buyer; and such other instruments of transfer and conveyance as are required
pursuant to Section 1.4 above; and
(b) Buyer will execute and deliver to Seller the Note;
and
(c) Each party will execute and deliver to the others
such other agreements, certificates, assignments, consents and other documents
as are required or specified in this Agreement or as may reasonably be
requested by the other party to evidence compliance with the terms hereof
Simultaneously with the deliveries contemplated herein, Seller
will use its best efforts and take all such other action as may be reasonably
necessary to put Buyer in possession and control of the Assets.
2. REPRESENTATIONS AND WARRANTIES OF SELLER.
Seller represents and warrants to Buyer as follows:
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2.1 Corporate Status. Seller is a corporation duly organized,
validly existing and in good standing under the laws of Texas and has all
necessary corporate power and authority to carry on its business as now
conducted and to own or lease and operate its properties, and to execute,
deliver and perform its obligations hereunder.
2.2 Authority for Agreement. This Agreement constitutes the valid
and legally binding obligation of Seller and the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of the board of
directors and shareholders of Seller, will not conflict with or result in any
violation of, or default under, any provisions of the charter or bylaws of
Seller and will not conflict with or result in any violation of, or default
with respect to, any mortgage, indenture, lease, agreement or other instrument
affecting the Assets, or to which Seller or its affiliates, is a party, or by
which Seller or its affiliates is bound.
2.3 Properties. Seller has good, valid and marketable title to
the Assets subject to no liens, encumbrances, security interests or mortgages,
except for those obligations as described in Section 1.1(b) above. The legal
and beneficial interests in the Assets are owned exclusively by Seller.
2.4 Brokers, Finders, etc. No broker, finder or other financial
consultant has acted on behalf of Seller or its affiliates in connection with
the transactions contemplated by this Agreement and all negotiations relative
to this Agreement have been carried on directly without the intervention of any
such third party.
3. REPRESENTATIONS AND WARRANTIES OF BUYER.
3.1 Corporate Status. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Texas.
Buyer has full power and authority to execute and deliver the Agreement on
Buyer's behalf, and to perform its obligations hereunder.
3.2 Authority for Agreement. Buyer has all necessary power and
authority to execute and deliver this Agreement and to carry out its
obligations hereunder. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by the Board of Directors of Buyer. No notice, consent, approval, order or
authorization of, or registration, declaration or filing with, any person or
entities, or with any governmental authority is required in connection with the
execution and delivery of this Agreement or the consummation by Seller of the
transactions contemplated hereby or thereby.
3.3 Brokers, Finders, etc. No broker, finder or other financial
consultant has acted on behalf of Buyer or its affiliates in connection with
the transactions contemplated by this Agreement and all negotiations relative
to this Agreement have been carried on directly without the intervention of any
such third party.
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4. INDEMNIFICATION.
4.1 Indemnification.
(a) Seller covenants and agrees to indemnify and hold
Buyer harmless from and against any and all losses, liabilities, damages,
demands, claims, suits, actions, judgments or causes of action, assessments,
costs and expenses, including, without limitation, interest, penalties,
attorneys' fees, any and all expenses incurred in investigating, preparing or
defending against any litigation, commenced or threatened, in writing or any
other claim, and any and all amounts paid in settlement of any claim asserted
in writing or litigation, asserted against, resulting to, imposed upon, or
incurred or suffered by Buyer, directly or indirectly, as a result of or
arising from the operation of the Business prior to the Closing Date and during
the "Transitional Period" ("Transitional Period" is defined as the period
between closing date and cessation of Seller's duties assumed under paragraph
5.3), other than as otherwise contemplated herein.
(b) Buyer covenants and agrees to indemnify and hold
Seller harmless from and against any and all losses, liabilities, damages,
demands, claims, suits, actions, judgments or causes of action, assessments,
costs and expenses, including, without limitation, interest, penalties,
attorneys' fees, any and all expenses incurred in investigating, preparing or
defending against any litigation, commenced or threatened, in writing or any
other claim, and any and all amounts paid in settlement of any claim asserted
in writing or litigation, asserted against, resulting to, imposed upon, or
incurred or suffered by Seller, directly or indirectly, as a result of or
arising from the operation of the Business from and after the Closing Date,
other than as otherwise contemplated herein.
5. POST CLOSING COVENANTS.
5.1 Covenant Not to Compete. In exchange for the representations
and warranties and fulfillment of the agreements contained herein by Buyer,
Seller and each of its principals severally agrees not to compete, either
directly or indirectly, as an officer, director, employee, partner, consultant
or shareholder, for a period of three (3) years commencing with the Closing
Date in the Territory, in any internet access endeavor which is in competition
with the Business. For purposes of this Section 5.1, the term "Territory"
shall mean any area where Buyer has a local point-of-presence (defined as
equipment installed to cover a particular geographical area). Additionally,
Seller agrees during the one year period following the Closing Date to forward
any and all sales leads generated from the Territory to Buyer.
5.2 Utilities. Seller will transfer all utilities servicing the
Business, including telephones, water and power to Buyer on or prior to closing
date.
5.3 Consulting Fees. Buyer agrees to pay Seller a fee in the
amount of $3,500.00 per month, payable on the first day of the month, for
services consisting of continuation of billing, collection, and operating
activities during the Transitional Period. Seller or Buyer may cancel these
consulting services with seven days notice before the start of any month.
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6. MISCELLANEOUS PROVISIONS.
6.1 Entire Agreement. This Agreement, together with all the
schedules and exhibits hereto, constitutes the entire agreement among the
parties hereto pertaining to the subject matter hereof and supersedes all prior
and contemporaneous agreements,. understandings, negotiations and discussions,
whether oral or written, of the parties, and there are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth herein.
6.2 Amendment. This Agreement may be amended by the parties
hereto at any time, but only by an instrument in writing duly executed and
delivered on behalf of each of the parties hereto.
6.3 Headings. The section headings are not to be considered part
of this Agreement and are included solely for convenience and are not intended
to be full or accurate descriptions of the contents thereof. References to
Sections are to portions of this Agreement unless the context requires
otherwise.
6.4 Exhibits, etc. Exhibits and schedules referred to in this
Agreement are an integral part of and are incorporated in this Agreement by
reference.
6.5 Assignment; Successors and Assigns. All of the terms and
provisions of this Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective transferees, successors and
assigns.
6.6 Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered or sent Federal Express or other reputable overnight
courier, postage prepaid or by certified mail, return receipt requested:
(a) if to the Seller:
WEBSTAR, INC.
X.X. Xxx 000
Xxxxx, XX 00000
(b) if to Buyer:
INTERNET AMERICA, INC.
One Dallas Centre
000 X. Xx. Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
6.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
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6.8 Severability. The provisions of this Agreement are severable,
and in the event that any one or more provisions are deemed illegal or
unenforceable, the remaining provisions shall remain in full force and effect.
6.9 Counterparts. This Agreement may be executed simultaneously
in any number of counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereby have duly executed this
Agreement as of the day and year first above written.
INTERNET AMERICA, INC.
a Texas corporation
By: /s/ XXXXXXX XXX
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Its: SR VP
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WEBSTAR, INC.
a Texas corporation
By: /s/ XXXX XXXXXX
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Its: President
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Executed by the undersigned as of the day and year first above written
to reflect the undersigned's agreement to the provisions of Section 5.1 hereof.
/s/ Xxxx Xxxxxx
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Signature Signature
Xxxx Xxxxxx
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Please Print Name Please Print Name
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