Exhibit 2.1
ASSET PURCHASE AGREEMENT
This Agreement entered into this 30th day of July 2001 by
and between ▇▇▇▇▇▇▇▇ Affiliated Productions, Inc. (hereinafter
individually and collectively "Selling Shareholder") and Media
and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. a Nevada corporation (hereinafter
"Buyer").
WHEREAS, Seller owns the rights to various assets; and
WHEREAS, Buyer desires to acquire substantially all of the
assets used or useful, or intended to be used in the operation of
Sellers business and Seller desires to sell such assets to Buyer;
and
WHEREAS, the Selling Shareholder is the sole shareholder of
Seller.
NOW, THEREFORE, in consideration of mutual covenants
contained herein and other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
SECTION 1. ASSETS PURCHASED; LIABILITIES ASSUMED
1.1 ASSETS PURCHASED. Seller agrees to sell to Buyer
and Buyer agrees to purchase from Seller, on the terms and
conditions set forth in this Agreement the following assets
("Assets");
i. All assets listed on Exhibit "A," together with any
replacements or additions to the assets made prior to the closing
date.
ii. The names of the business which will become a DBA of Media
and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. (▇▇▇▇▇▇▇▇ Affiliated Productions)
iii. All associated intangible assets.
iv. Seller's goodwill if any.
v. All cash and money instruments in all accounts.
vi. All Accounts Receivables.
vii. All furniture, inventory, and equipment per the attached
list.
viii. All Copyrights, Trademarks, and Patents.
ix.
All future checks for ▇▇▇▇▇▇▇▇ agency work will be endorsed
over to Media and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
1.2 NO ASSUMPTION OF LIABILITIES. Buyer shall not be
responsible for any unfilled orders from customers of Seller nor
shall Buyer assume responsibility of payment for other
obligations of Seller, including but not limited to, Seller's
obligations under any lease, contract or account. There are
absolutely no liabilities of the ▇▇▇▇▇▇▇▇ Agency as part of this
transfer at any time. All clients, vendors, and associates will
be notified of the same.
SECTION 2. EXCLUDED ASSETS
The corporation shall be excluded. Subsequent to the
Acquisition, ▇▇▇▇▇▇▇ Moghaddasain existing corporation shall be
dissolved so the name can transfer to Media for continued work
under the ▇▇▇▇▇▇▇▇ name.
SECTION 3. PURCHASE PRICE FOR ASSETS
The purchase price for the assets shall be 100,000 shares of
common stock in Media and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. with par value
of $0.001 payable at closing.
Buyer shall be responsible for all sales and transfer taxes
associated with the contemplated transaction.
SECTION 4. PAYMENT OF PURCHASE PRICE
The price for the Assets shall be paid as follows:
4.1 At closing, as payment for the Assets, Media shall
issue to ▇▇▇▇▇▇▇▇ one hundred thousand (100,000) shares of Common
Stock of Media and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., with a par value of
$0.001. In addition, Media shall enter into an acceptable
employment agreement with ▇▇▇▇▇▇▇ Moghaddasain that includes a
salary of sixty-thousand ($60,000) dollars annually and an
additional one hundred thousand (100,000) shares payable as
compensation based on benchmarks of sales as follows: At the end
of fiscal year 2002, if the contribution by the line of business
for which he is responsible, namely of ▇▇▇▇▇▇▇▇ Affiliated
Productions is equal to or greater than $1,000,000.00 the
Employee shall be granted options for 100,000 shares of common
stock in Media and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. A percentage of the
maximum will be applied to the gross amount contributed during
that period. If Employee reaches
$800,000 then granted options would be 80,000 shares. Employee
will also be allowed more shares based on $100,000 increment
increases for revenue performance at 10,000 shares per $100,000
dollar increase.
4.2 The employee shall be paid 60% of the gross profits
from all contracts the ▇▇▇▇▇▇▇▇ Affiliate Productions exercises
under its control. Gross Profit will be all gross revenues less
direct expenses for production of ▇▇▇▇▇▇▇▇ Affiliate Productions
with a mutually agreeable revenue-earning cap.
4.3 The parties agree that amounts due hereunder shall be
net amounts due to Seller without regard to interest whatsoever,
whether actual, imputed or implied.
SECTION 5. OTHER AGREEMENTS
5.1 Subsequent to the Acquisition, Media and
▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇'s Board of Directors shall consist of four
members. The three current Board members shall propose,
recommend and send a proxy to shareholders of the Company
regarding the election of ▇▇▇▇▇▇▇ Moghaddasain, once the asset
transfer is complete, to the Board.
5.2 There are no other agreements written or implied,
except as specifically referenced in and attached to this
Agreement.
SECTION 6. SELLER'S AND SELLING SHAREHOLDER'S REPRESENTATION
AND WARRANTIES
Seller and Selling shareholder each represent warrant to
Buyer as follows:
6.1 CORPORATE EXISTENCE. Seller is now and on the date of
closing will be a duly organized and validly existing corporation
and in good standing under the laws of the State of California.
Seller has complete and total ownership and clear title of these
said assets.
6.2 AUTHORIZATION. The execution, delivery and performance
of this Agreement have been duly authorized and approved by the
Board of Directors and Shareholders of Seller, and this Agreement
constitutes a valid and binding agreement of Seller in accordance
with its terms.
6.3 TITLE TO ASSETS. Except as described in the Agreement,
Seller holds good and marketable title to the assets, free and
clear of restrictions on or conditions to transfer or assignment,
and free and clear of liens, pledges, charges or encumbrances.
6.4 BROKERS AND FINDERS. Neither Seller nor Selling
Shareholder has employed any
broker or finder in connection with the transaction contemplated
by this Agreement or taken action that would give rise to valid
claims against any party for a brokerage commission, finder's fee
or other like payment.
6.5 TRANSFER NOT SUBJECT TO ENCUMBRANCES FOR THIRD PARTY
APPROVAL.
The execution and delivery of this Agreement by Seller and
Selling Shareholder, and the consummation of the completed
transactions, will not result in the creation or imposition of
any valid lien, charge or encumbrance on any of the assets, and
will not require the authorization, consent, or approval of any
third party, including any governmental division or regulatory
agency.
6.6 LABOR AGREEMENT AND DISPUTES. Seller is neither party
to, nor otherwise subject to any collective bargaining or other
agreement governing the wages, hours, in terms of any associated
business of Sellers.
6.7 NONCANCELLABLE CONTRACTS. At the time of closing,
there will be no material leases, employment contracts, contracts
for services, or maintenance, or other similar contracts,
existing or related to or connected with the operation of
Seller's assets not cancelable within thirty (30) days.
6.8 LITIGATION. Seller and Selling Shareholder have no
knowledge of any claim, litigation, proceeding, or investigation
pending or threatened against Seller that might result in any
material adverse change in the business or condition of the
assets being conveyed under this Agreement.
6.9 ACCURACY OR REPRESENTATION AND WARRANTIES.
None of the representations or warranties of Seller or
Selling Shareholder contain or will contain any untrue statements
of a material fact or omit or will omit or misstate a material
fact necessary in order to make statements in this Agreement not
misleading. Seller and Selling Shareholder know of no fact that
has resulted, or that in the reasonable judgment of Selling
Shareholder will result in material change in the business,
operations, or assets of Seller that has not been set forth in
this Agreement or otherwise disclosed to Buyer.
SECTION 7. REPRESENTATION OF BUYER
Buyer represents and warrants as follows:
7.1 CORPORATE EXISTENCE. Buyer is a corporation duly
organized, validly existing, and in good standing under the law
of the State of Nevada. Buyer has all requisite corporate power
and authority to enter into this Agreement and perform its
obligations hereunder.
7.2 AUTHORIZATION. The execution, delivery and
performance of this Agreement have been duly authorized and
approved by the Board of Directors and shareholders of Buyer, and
this Agreement constitutes a valid and binding agreement of Buyer
in accordance with its terms.
7.3 BROKERS AND FINDERS. Buyer has not employed any broker
or finder in connection with the transaction contemplated by this
Agreement and has taken no action that would give rise to a valid
claim against any party for a brokerage commission, finder's fee
or other like payment.
7.4 ACCURACY OF REPRESENTATIONS AND WARRANTIES. None of
the representations or warranties of Buyer contain or will
contain any untrue statement of a material fact or omit or will
omit or misstate a material fact necessary in order to make the
misstatements contained herein not misleading.
SECTION 8. COVENANTS OF SELLER AND SELLING SHAREHOLDER
8.1 SELLER'S OPERATION OF BUSINESS PRIOR TO CLOSING.
Seller and selling shareholder agree that between the date of
this Agreement and the date of closing, Seller will:
8.1.1 Use its best efforts to preserve its business
organization and preserve the continued operation of its business
with its customers, suppliers, and others having business
relations with Seller.
8.1.2 Not assign, sell, lease or otherwise transfer or
dispose of any of the assets listed on Exhibit "A", except to
Buyer.
8.1.3 Maintain all of its assets other than inventories in
their present conditions, reasonable wear and tear and ordinary
usage accepted and maintain the inventories at levels normally
maintained.
8.2 ACCESS TO PREMISES AND INFORMATION. At reasonable
times prior to the closing date, Seller will provide Buyer and
its representatives with reasonable access during business hours
to the assets, titles, contracts and records of Seller and
furnish such additional information concerning Seller's assets
Buyer may from time to time reasonable request.
8.3 EMPLOYEE MATTERS.
8.3.1 There are no employee matters regarding Seller.
8.4 CONDITIONS AND BEST EFFORTS. Seller and Selling
Shareholder will use their best efforts to effectuate the
transactions contemplated by this Agreement and to fulfill all
the conditions of the obligations of Seller and Selling
Shareholder under this Agreement, and will do all acts and things
as may be required to carry out their respective obligations
under this Agreement and to consummate and complete this
agreement.
SECTION 9. COVENANATS OF BUYER
9.1 CONDITIONS AND BEST EFFORTS. Buyer will use its best
efforts to effectuate the transaction contemplated by this
Agreement and to fulfill all the conditions of Buyer's
obligations under this Agreement, and shall do all acts and
things as may be required to carry out Buyer's obligations and to
consummate this Agreement.
9.2 CONFIDENTIAL INFORMATION. If for any reason the sale
of Assets is not closed, Buyer will not disclose to third parties
any confidential information received from Seller or Selling
Shareholder in the course of investigating, negotiating, and
performing the transactions contemplated by this Agreement.
SECTION 10. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
The obligation of Buyer to purchase the Assets is subject to
the fulfillment, prior to or at the closing date, of each of the
following conditions, any one or portion of which may be waived
in writing by Buyer:
a.
REPRESENTATIONS, WARRANTIES AND COVENANTS AND SELLING
SHAREHOLDER.
All representations and warranties made in this
Agreement by Seller and Selling Shareholder shall be true as of
the closing date as fully as those such representations and
warranties had been made on or as of the closing date, and, as of
the closing date, neither Seller nor Selling Shareholder shall
have violated or shall have failed to perform in accordance with
any covenant contained in this Agreement.
10.2 LICENSES AND PERMITS. Buyer shall have obtained all
licenses and permits from public authorities necessary to
authorized the ownership and operation of the business of Seller.
10.3 CONDITIONS OF THE BUSINESS. There shall have been no
material adverse change in the manner in of operation of Seller's
assets prior to the closing date.
10.4 NO SUITS OR ACTIONS. At the closing date, no suit,
action or other proceeding shall have been threatened or
instituted to restrain, enjoin or otherwise prevent the
consummation of this Agreement or the contemplated transactions.
SECTION 11. CONDITIONS PRECENDENT TO OBLIGATIONS OF SELLER
AND SELLING SHAREHOLDER
The obligations of Seller and Selling Shareholder to
consulate the transactions contemplated by this Agreement are
subject to the fulfillment, prior to or at the closing date, of
the following condition, which may be waived in writing by
Seller:
All representations and warranties made in this Agreement by
Buyer shall be true as of the closing date as fully as though
such representations and warranties have been made on and as of
the closing date, and Buyer shall not have violated or shall not
have failed to perform in accordance with any covenant contained
in this Agreement.
SECTION 12. BUYER'S ACCEPTANCE
Buyer represents and acknowledges that it has entered into
this Agreement on the basis of its own examination, personal
knowledge, and opinion the value of the business. Buyer has not
relied on any
Representations made by Seller other than those specified in this
Agreement. Buyer further acknowledges that Seller has made no
agreement or promise to repair or improve any property being sold
to Buyer under this Agreement, and that Buyer takes all such
property in the condition existing on the date of this Agreement,
except as otherwise provided in this Agreement.
SECTION 13. INDEMNIFICATION AND SURVIVAL
13.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Agreement shall
survive the closing of this Agreement, except that any party to
whom a representation of warranty has been made in this Agreement
shall be deemed to have waived any misrepresentation or breach of
representation or warranty which such party had knowledge prior
to closing. Any party learning or a misrepresentation or breach
of representation or warranty under this Agreement shall
immediately give notice thereof to all other parties to this
Agreement. The representations and warranties in this Agreement
shall terminate three (3) years from the closing date, and such
representations or warranties shall thereafter be without force
or effect, except any claim with respect to which notice has been
given to the party to be charged prior to such expiration date.
13.2 SELLERS AND SELLING SHAREHOLDERS INDEMNIFICATION.
13.2.1 Seller and selling Shareholder each hereby agree to
indemnify and hold buyer, its successors and assigns harmless
from and against:
(1) Any and all claims, liabilities and obligations of every
kind and description, contingent or otherwise, arising out of or
related to the operation of Seller's assets prior to the close of
business on the day before the closing date, except for claims,
liabilities and obligations of seller expressly assumed by buyer
under this agreement or paid by insurance maintained by Seller,
selling Shareholder or Buyer.
(2) Any and all damage or deficiency resulting from any
material misrepresentation or breach of warranty or covenant, or
nonfulfillment of any agreement on the part of Seller or the
selling Shareholder under this agreement.
13.2.2 Sellers and Selling Shareholders indemnity
obligations under 13.2.1 shall be subject to the following:
(1) If any claim is asserted against buyer that would give
rise to a claim by Buyer against Seller and Selling Shareholder
for indemnification under the provisions of this paragraph, the
Buyer shall promptly give written notice to selling Shareholder
concerning such claim as selling Shareholder shall, at no expense
to Buyer defend the claim.
(2) Selling Shareholder shall not be required to indemnify
buyer for amount that exceeds the total purchase price paid by
buyer under Section 3 of this agreement.
13.3 BUYERS INDEMNIFICATION. Buyer agrees to defend,
indemnify and hold harmless Seller and Selling Shareholder from
and against:
13.3.1 Any all claims, liabilities and obligations of every
kind and description arising out of or related to the operation
of the business following closing or arising out of buyers faith
to perform obligations of Seller assumed by buyer pursuant to
this agreement.
13.3.2 Any all damage or deficiency resulting from any
material misrepresentation, breech of warranty or covenant, or
nonfulfillment of any agreement on the part of Buyer under this
agreement.
SECTION 14. CLOSING
14.1 TIME AND PLACE. This agreement shall be closed on or
before the 30th day of July 2001, or such other time as the
parties may agree in writing.
14.2 OBLIGATIONS OF SELLERS AND SELLING SHAREHOLDER AT
CLOSING. The closing, Seller and Selling Shareholder shall
deliver to buyer the following:
14.2.1 Bills of Sale, Assignments, properly endorsed
Certificate of Titles, and other instruments of transfer, and
form and substance reasonable satisfactory to counsel for Buyer,
necessary to transfer and convey all of the assets to Buyer.
14.2.2 Such other certificates and documents as may be
called for by the provisions of this Agreement.
14.3 OBLIGATIONS OF BUYER AT CLOSING. At the closing Buyer
shall delivery to Seller the following:
14.3.1 A 100,000 share stock certificate made out to
▇▇▇▇▇▇▇▇ Affiliated Productions, Inc. a California Corporation.
14.3.2 Such other certificates and documents as may be
called for by the provisions of this Agreement.
SECTION 15. RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING
15.1 BOOKS AND RECORDS. This sale does include the books
of account and records of any additional assets of Seller.
15.2 SELLER'S RIGHT TO PAY. In the event Buyer fails to
make any payment of taxes, assessments, insurance premiums, or
other charges that Buyer is required to pay to third parties
under this Agreement, Seller shall have the right, but not the
obligation, to pay the same.
Buyer will reimburse Seller for any such payment immediately
upon Seller's demand, together with interest at the same rate
provided in the Note from the date of Seller's payment until
Buyer reimburses Seller. Any such payment by Seller shall not
constitute a waiver by Seller of any remedy available by reason
of Buyer's default for failure to make the payments.
SECTION 16. BULK SALES LAW.
16.1 Buyer waives compliance by Seller with the Bulk
Transfer Act. In the event any creditor of Seller claims the
benefit of the Bulk Transfer Law as against Buyer or any of the
assets being conveyed to Buyer under this Agreement, Seller and
Selling Shareholder shall immediately pay or otherwise satisfy
such claim or undertake its defense. Seller and Selling
Shareholder shall indemnify and hold Buyer harmless from and
against any and all loss, expense, or damage resulting from the
failure to comply with the Bulk Transfer law. If Seller fails to
comply with the provision of this Section 17 and Buyer is
required to pay any creditor of Seller in order to protect the
property purchased under this agreement from claims or liens of
Seller's creditors, except those assumed by Buyer, the Buyer may
offset the amount it pays against the balance due Seller by
furnishing to the Seller proof of such payment in the form of a
receipt from the creditor involved.
SECTION 17. TERMINATION OF AGREEMENT
17.1 BY MUTUAL CONSENT. This Agreement may be terminated
by mutual written consent of Buyer and Seller.
17.2 BREACH OF REPRESENTATIONS AND WARRANTIES; FAILURE OF
CONDITIONS. Buyer may elect by notice to Seller, and Seller may
elect by notice to Buyer, to terminate this Agreement if:
17.2.1 The terminating party shall have discovered a
material error, misstatement, or omissions in the representations
and warranties made in this Agreement by the other party which
shall not have been cured by such other party within fifteen (15)
days after written notice to such other party specifying in
detail such asserted error, misstatement, or omission, or by the
closing date, whichever first occurs.
17.2.2 All of the conditions precedent of the terminating
party's obligations under this Agreement as set forth in either
Section 11 or 12, as the case may be, have not occurred and have
not been waived by the terminating party on or prior to the
closing date.
17.3 CLOSING NOTWITHSTANDING THE RIGHT TO TERMINATE. The
party with a right to terminate this Agreement pursuant to
Section 17.2.1 or 17.2.2 shall not be bound to exercise such
right, and its failure to exercise such right shall not
constitute a waiver of any other right it may have under this
Agreement, including but not limited to remedies for breach of a
representation, warranty, or covenant.
SECTION 18. MISCELLANEOUS
18.1 The provisions of this Agreement shall be binding upon
and inure to the benefit of the heirs, personal representatives,
successors, and assigns of the parties.
18.2 Any notice or other communication required or
permitted to be given under this Agreement shall be in writing
and shall be mailed by certified mail, return receipt requested,
postage
prepaid, addressed to the parties as follows:
SELLER: ▇▇▇▇▇▇▇▇ Affiliated Productions, Inc.
ADDRESS: ▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇/▇▇▇▇▇/▇▇▇: ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
CONTACT PERSON: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
TELEPHONE: ▇▇▇-▇▇▇-▇▇▇▇
BUYER: Media and ▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
ADDRESS: ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇. - Suite 300
CITY/STATE/ZIP: ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
CONTACT PERSON: ▇▇▇▇▇ ▇▇▇▇▇▇
TELEPHONE: ▇▇▇-▇▇▇-▇▇▇▇
All notices and other communications shall be deemed to be
given at the expiration of three (3) days after the date of
mailing. The address to which notices or other communications
shall be mailed may be changed from time to time by giving
written notice to the other parties as provided above.
18.3 In the event of a default under this Agreement, the
defaulting party shall reimburse the nondefaulting party or
parties for all costs and expenses reasonable incurred by the
nondefaulting party or parties in connection with the default,
including without limitation attorney fees. Additionally, in the
event a suit or action is filed to enforce this Agreement or with
respect to this Agreement, the prevailing party or parties shall
be reimbursed by the other party for all costs and expenses
incurred in connection with the suit or action, including without
limitation reasonable attorney fees at the trial level and on
appeal.
18.4 No waiver of any provision of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision,
whether or not similar, nor shall any waiver constitute a
continuing waiver. No waiver shall be binding unless executed in
writing by the party making the waiver.
18.5. This Agreement shall be governed by and shall be
construed in accordance with the laws of the State of Nevada.
18.6 This Agreement constitutes the entire agreement
between the parties pertaining to its subject and it supersedes
all prior contemporaneous agreements, representations, and
understandings of the parties. No supplement, modification, or
amendment of this Agreement shall be binding unless executed in
writing by all parties.
Witness the signatures of the parties this the ___________
day of July 2001.
SELLER: BUYER:
BY: /s/ ▇▇▇▇▇▇▇ Moghaddasain BY: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Moghaddasain, President ▇▇▇▇▇ ▇▇▇▇▇▇, President
DATED: 7/28/2001 DATED: 7/28/01
WITNESS
BY: _____________________
DATED: _________________
EXHIBIT "A"
1. Contracts for service with and outstanding Accounts
Receivable for the following:
2. Accessorize by ▇▇▇▇▇▇
3. AV Equipment Rental
4. ▇▇▇▇▇ Insurance
5. MCL Products
6. Media and Entertainment
7. RKR, Inc.
8. Santa Clarita Athletic Club
9. Santa Clarita Studios
10. Soundman
11. Tracy's Nails
12. Valencia Acura
13. Valencia Chevrolet
14. The business name ▇▇▇▇▇▇▇▇ Affiliated Productions
15. All associated goodwill and other intangibles