ASSET PURCHASE AND SALE AGREEMENT
THIS ASSET PURCHASE AND SALE AGREEMENT (this "Agreement") is made and
entered into as of November 1, 2000 (the "Effective Date"), by and among Sundog
Technologies, Inc., a Delaware corporation, ("Buyer"), Ensign Information
Systems, Inc., a Utah corporation ("Seller"), ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, an individual
("Holland"), ▇▇▇▇▇ ▇▇▇▇▇▇▇, and individual ("▇▇▇▇▇▇▇"; collectively with
Holland, the "Shareholders"). All capitalized terms not otherwise specifically
defined in the text hereof shall have the meanings set forth in Article 10
below.
Background
WHEREAS, the Shareholders collectively are the owners of one hundred
percent (100%) of the issued and outstanding capital stock of Seller;
WHEREAS, Seller is engaged in the business of developing and
distributing business-to-business applications software and hardware (the
"Business"); and
WHEREAS, Buyer desires to purchase from Seller, and Seller desires to
sell to Buyer, substantially all of the assets of Seller all as more
particularly set forth below.
Agreement
NOW, THEREFORE, in consideration of the respective representations,
warranties and covenants contained herein and for other good and valuable
consideration, the receipt and legal sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
SALE OF ASSETS; CLOSING
1.1 Assets. Subject to the terms and conditions of this Agreement, at
the Closing, Seller shall sell, transfer, assign, and deliver to Buyer, and
Buyer shall purchase from Seller, all right, title and interest in and to all
assets owned by Seller or used in the operation of the Business other than the
Excluded Assets (the "Assets"), including, without limitation, the following:
(a) all tangible personal property owned by Seller or used in
the operation of the Business, including without limitation all
computer hardware, equipment, furniture and property listed on Schedule
1.1(a) (the "Tangible Assets");
(b) all contracts, leases, licenses, and other agreements,
whether oral or written, listed on Schedule 1.1(b) --------------- (the
"Contracts"); ---------
(c) all real property owned by Seller or used in the operation
of the Business, including, without limitation, the leasehold interest
described on Schedule 1.1(c) (the "Real Property");
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(d) all business forms, inventory records, operating records,
customer lists, telephone numbers, vendor and customer price lists,
sales histories in any form, invoices, financial records, Tax Returns
(or copies thereof), tax records (or copies thereof), financial
statements, internal reports and other files or documents owned by
Seller or used in the operation of the Business (the "Records");
(e) all inventions, patents, improvements related to patented
or unpatented inventions, trademarks and trade names (whether currently
or formerly used, including the names "Ensign Information Systems,"
"Horizon 2000" and "Ensign Software"), service marks, assumed names,
trade dress, copyrights, United States, foreign, state and other
applications and registrations for and with respect to any of the
foregoing and renewals and continuation thereof, in each case with the
goodwill symbolized thereby and associated therewith, business
information, trade secrets, royalty rights, confidential information,
formulas, recipes, processes, techniques, know-how, licenses and other
rights to use any of the foregoing, any and all income, royalties,
damages, claims and payments now or hereafter receivable with respect
to any of the foregoing and all rights, including all rights to ▇▇▇,
relating thereto, all licenses, permits, permissions, and
authorizations, consents, easements, rights, of way, software, domain
names, websites, e-mail address, goodwill, going concern value, and any
and all other intangible assets owned by Seller or used in the
operation of the Business (the "Intangible Assets");
(f) all revenues of the Business for services performed or
products sold after the Effective Date, all expenses prepaid by Seller,
warranty rights, accounts receivable for services performed or goods
provided after the Effective Date and all other current assets of
Seller (the "Current Assets").
The Assets shall not include (a) the corporation record books and stock
records of Seller, (b) the Tax Returns and tax records of Seller (although
copies of such are included in the Assets), (c) assets related to any pension or
benefit plan of Seller, (d) cash, savings, checking or other deposits, cash
equivalents, securities, investments and accounts receivable for services
performed or goods provided prior to the Effective Date, and (d) the personal
property described on Schedule 1.1(g) (the "Excluded Assets")].
1.2 Exclusion of Liabilities other than Assumed Liabilities.
(a) On the Closing Date and subject to the terms and
conditions of this Agreement, including Section 6.7, Buyer agrees to
assume and become responsible for the obligations of the Seller under
the Contracts described on Schedule 1.1(b) arising and accruing after,
and relating exclusively to the operation of the Business after, the
Closing Date (the "Assumed Liabilities").
(b) Seller and the Shareholders understand and acknowledge
that, except for the Assumed Liabilities, Buyer shall not assume or
have any responsibility, liability or obligation for any obligation,
commitment, responsibility, or other Liability of any kind or nature
incurred by the Selling Shareholders or Seller in connection with the
Business or arising, accruing, or related to the operation of the
Business or actions or omission of Seller or the Shareholders prior to
the Closing Date, including, without limitation, Liabilities for Taxes,
Liabilities for contractual obligations of Seller not included in the
Assumed Liabilities, Liabilities for violations of Environmental Law or
Liabilities related in any way to any profit sharing, accounts payable
arising prior to the Effective Date, 401(k) savings, employee pension
plans, deferred compensation plan, severance pay, cafeteria plan, life
insurance, medical, dental, disability, welfare or vacation plan of
Seller or any other plan or arrangement of Seller of any kind or
character related to its employees. Seller and the Shareholders jointly
and severally agree to indemnify and hold Buyer harmless from all
Liabilities, losses, costs or expenses, including reasonable attorney's
fees, incurred by Buyer as a result of any claim made against Buyer
attributable to any Liability of other than the Assumed Liabilities.
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1.3 Consideration for the Assets. In consideration for the transfer of
the Assets, Buyer shall issue and deliver to Ensign at Closing, free and clear
of any all encumbrances other than the restrictions on transferability outlined
in Section 2.22 of this Agreement, Three Million (3,000,000) shares of Common
Stock (the "Shares"). The obligations of the parties as set forth in Section
1.1, 1.2 and 1.3 shall be collectively referred as the "Exchange." The purchase
price shall be allocated among the Assets for all purposes in accordance with an
allocation schedule agreed to by the parties following closing.
1.4 Closing. The parties agree to close the Exchange (the "Closing") on
November 9, 2000 or a date thereafter that is mutually acceptable to such
parties (the "Closing Date"). The Closing shall take place at the offices of
Buyer at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ at 10:00
a.m., Mountain Standard Time, on the Closing Date and shall be effective as of
12:01 a.m. on the Closing Date. Notwithstanding a later Closing Date, the
parties agree that, except as provided in Section 1.2, to the extent permitted
by governing laws, regulations and standards, the Exchange will be deemed to
have been effective as of the Effective Date.
1.5 Closing Deliveries.
(a) At the Closing, Seller, Holland, and ▇▇▇▇▇▇▇ shall deliver
to Buyer the following:
(i) Seller shall deliver an executed ▇▇▇▇ of Sale in the form
of Exhibit A, transferring to Buyer the --------- Tangible
Assets, free and clear of all Encumbrances;
(ii) Seller shall deliver an executed Assignment Agreement in
the form of Exhibit B, assigning to Buyer the Intangible
Assets, the Records and the Current Assets, free and clear of
all Encumbrances;
(iii) Seller shall deliver an executed counterpart of an
Assignment and Assumption Agreement in the form of Exhibit C,
assigning to Buyer the Contracts, free and clear of all
Encumbrances;
(iv) Seller shall deliver possession of all of the Tangible
Assets, Real Property, Current Assets, and Records;
(v) Holland shall deliver an executed counterpart of an
Employment Agreement between Holland and Buyer in
substantially the form of Exhibit D; ---------
(vi) ▇▇▇▇▇▇▇ shall deliver an executed counterpart of an
Employment Agreement between ▇▇▇▇▇▇▇ and Buyer in
substantially the form of Exhibit E; and ---------
(vii) Seller, Holland, and ▇▇▇▇▇▇▇ shall deliver such other
documents, agreements, assignments, instruments and
certificates as may be required by this Agreement or as may be
reasonably requested by Buyer to carry out the terms and
conditions of this Agreement.
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(b) Buyer shall deliver to Seller:
(i) within two business days of Closing, a certificate
representing the Shares (containing the legends required by
Section 2.22(h) of this Agreement);
(ii) at Closing, an executed counterpart of an Assignment and
Assumption Agreement in substantially the form of Exhibit C;
---------
(iii) at Closing, an executed counterpart of an Employment
Agreement between Holland and Buyer in substantially the form
of Exhibit D; ---------
(iv) at Closing, an executed counterpart of an Employment
Agreement between ▇▇▇▇▇▇▇ and Buyer in substantially the form
of Exhibit E; ---------
(v) such other documents, agreements, assignments, instruments
and certificates as may be required by this Agreement or as
may be reasonably requested by Seller or Shareholders to carry
out the terms and conditions of this Agreement.
1.6 Tax Consequences. It is intended that the Exchange shall constitute
a reorganization within the meaning of Section 368(a) of the Code, and that this
Agreement shall constitute a "plan of reorganization" for purposes of Section
368 of the Code; provided, however, no party represents or warrants to any other
party that the Exchange shall constitute a reorganization within the meaning of
Section 368(a) of the Code, and each party hereto agrees that such party is
responsible for all tax consequences arising from the Exchange or any other
transaction related thereto or derived therefrom. Each party to this agrees
that, except in reliance upon advice from competent counsel that compliance with
the succeeding clause would violate governing law, such party shall not take any
action, or file any Tax Return, that would be inconsistent with treating the
Exchange as a reorganization under Section 368(a) of the Code.
1.7 Adjustments. If as a result of any merger, consolidation or sale of
all or substantially all of the assets of the Buyer or any reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split, or other similar transaction prior to the Closing, (i) the outstanding
shares of Common Stock are increased or decreased or are exchanged for a
different number or kind of shares or other securities of Buyer, or (ii)
additional shares or new or different shares or other securities of Buyer or
other non-cash assets are distributed with respect to the Common Stock or other
shares of capital stock of Buyer, an appropriate and proportionate adjustment
shall be made in number of shares of Common Stock to be distributed to Ensign
pursuant to Section 1.3(a) above
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER AND THE SHAREHOLDERS
For the purpose of inducing Buyer to enter into this Agreement and with
the knowledge that Buyer will rely on the following representations and
warranties, as of the Closing Date, Seller and the Shareholders, jointly and
severally, represent and warrant to Buyer as follows:
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2.1 Authority. Seller has full corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder. This
Agreement has been duly executed and delivered by Seller and the Shareholders
and constitutes the legal, valid and binding agreement of Seller and the
Shareholders enforceable against Seller and each of the Shareholders in
accordance with its terms, except as such enforceability may be limited by
bankruptcy and the laws affecting the enforcement of creditors' rights generally
or equitable principles. All board, shareholder, and other corporate approvals
necessary to approve this Agreement and the transactions contemplated thereby on
the part of Seller have been obtained, definitive evidence of which has been
delivered to Buyer prior to the Closing Date.
2.2 Organization, Existence, Good Standing and Capitalization. Seller
(i) is a corporation duly organized, validly existing and in good standing under
the laws of the State of Utah (ii) is qualified to do business in every
jurisdiction in which its ownership of property or conduct of business requires
it to qualify (3) has full corporate power and authority to carry on the
Business as now being conducted, to own and operate its properties and assets
including the Assets, and to perform all of its obligations under the Contracts.
Seller has not for the past five years, and is not currently, conducting the
Business under any names other than "Ensign Information Corporation." As of the
date of this Agreement, the only authorized capital stock of Seller consists of
3,000 shares of common stock of Seller, of which 2,000 are issued and
outstanding and held of record the Shareholders. The Shareholders hold of record
one hundred percent (100%) of the issued and outstanding capital stock of
Seller. Seller has neither granted nor issued any options, warrants or other
rights or securities convertible into or exercisable for purchase common stock
or any other capital stock of Seller.
2.3 Consents and Approvals; No violation. Except as set forth on
Schedule 1.1(b) and related to consents to transfer of the Contracts, neither
the execution, delivery and performance of this Agreement, nor the consummation
of the transactions contemplated hereby will (a) violate or conflict with, (b)
result in, or require the creation or imposition of, any Encumbrance upon or
with respect to any of the Assets pursuant to, (c) require Seller or the
Shareholders to make any filing or registration with, give notice to, or obtain
any consent, approval or authorization from any Governmental Authority or any
other Person (including creditors) in accordance with, (d) result in a breach
of, constitute (with or without due notice or lapse of time or both) a default
under, or give rise to any right of termination, cancellation or acceleration
under, any provision of the Articles of Incorporation or Bylaws of the Seller,
any Legal Requirement binding upon Seller or the Shareholders, any contract,
agreement, license, lease, instrument or other arrangement binding upon Seller
or the Shareholders, or any Governmental Authorization or any other instrument
or obligation to which Seller or the Shareholders are a party, by which Seller,
the Shareholders or any of the Assets may be bound or to which Seller, the
Shareholders or any of the Assets may be subject.
2.4 Financial Statements. Seller has delivered to Buyer: (a) unaudited
balance sheets of the Seller dated as of December 31, 1999 and December 31, 1998
and the related unaudited combined statements of income, changes in stockholders
equity and cash flows for each of the two fiscal years then ended and (b) the
unaudited balance sheet for the Sellers as of September 30, 2000 (the "Most
Recent Balance Sheet"), and the related unaudited combined statement of income
for the nine months then ended ((a) and (b), collectively, the "Financial
Statements"). The Financial Statements and the notes thereto fairly present the
financial condition and results of operations of the Sellers as of the
respective dates thereof and for the periods therein referred to, all in
accordance with GAAP. The Financial Statements reflect the consistent
application of such accounting principles throughout the periods involved.
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2.5 Taxes. Seller has filed or caused to be filed on a timely basis all
Tax Returns that are or were required to be filed by or with respect to Seller,
pursuant to the Legal Requirements of each Governmental Authority with taxing
power over it or its assets, except such Taxes, if any, as are set forth in the
Financial Statements and are being contested in good faith and as to which
adequate reserves (determined in accordance with GAAP) have been provided in the
Most Recent Balance Sheet. Each of the Shareholders has paid, or made provision
for the payment of, all Taxes of such Shareholder that have or may have become
due with respect to Seller or such Shareholder's ownership of Seller. There have
been no audits by the Internal Revenue Service or relevant state tax authorities
of the United States federal or state income, or state franchise or sales, Tax
Returns of Seller or any Shareholder. Neither Seller nor any Shareholder has
given or been requested to give waivers or extensions (or is or would be subject
to a waiver or extension given by any other entity) of any statute of
limitations relating to the payment of Taxes of such Person or for which such
Person may be liable. The charges, accruals and reserves with respect to Taxes,
including, without limitation, deferred Taxes, on the respective books of Seller
are adequate (determined in accordance with GAAP) and are at least equal to
Seller's Liability for Taxes. There exists no proposed tax assessment against
Seller except as disclosed in the Financial Statements. All Taxes that Seller is
or was required by law to withhold or collect have been duly withheld or
collected and, to the extent required, have been paid to the proper Governmental
Authority or other Person. All Tax Returns filed by or on behalf of Seller and
each Shareholder are true, correct and complete. Seller has no, and will not
have any, Liability for Taxes of any nature relating to periods prior to the
Closing Date except as will be reflected in the Financial Statements, and all
such Liability for Taxes reflected in the Financial Statements shall remain the
sole obligation of the Seller and the Shareholders.
2.6 Books and Records. All Records of the Business have been made
available to Buyer and are true, complete and correct. At the Closing, all such
Records will be in the possession of Seller and will be delivered to Buyer.
Seller has provided to Buyer a true and correct copy of its Articles of
Incorporation, Bylaws, and any other corporate governance documents, including
any shareholder's agreements or agreements with respect to the issuance of
capital stock, to Buyer.
2.7 Tangible Assets. Schedule 1.1(a) contains an accurate and complete
listing of all of the Tangible Assets. All of the Tangible Assets are
merchantable, in material compliance with all requirements of all-governing laws
and regulations, and in good working order and repair.
2.8 Contracts. Schedule 1.1(b) contains an accurate and complete
listing of all of the agreements, licenses, leases and other contracts, whether
written or oral, between Seller and any other Person. No amounts have been paid
to Seller or any of its Affiliates, in advance in the form of fees or
compensation with respect to any Contract. No amount is owed under any Contract
by Seller to any Person for goods or services received by or on behalf of
Seller. True, correct and complete copies of each Contract, or with respect to
oral agreements written summaries of the material terms thereof, have been
delivered to Buyer. With respect to each Contract, including any lease or
license under which Seller uses real property:
(a) Each is in full force and effect, is legal, valid and
binding and is enforceable in accordance with its terms. Each will
continue to be in full force and effect, legal, valid and binding and
enforceable in accordance with its terms following the consummation of
the transactions contemplated hereby;
(b) Seller, and to the knowledge of Seller and the
Shareholders, each other party, has not defaulted under and is not in
breach of any Contract, and no condition exists or event has occurred
which, with notice or lapse of time or both, would constitute a default
or a basis for force majeure or other claim of excusable delay or
non-performance thereunder; and
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(c) No party to any Contract has repudiated any provision
thereof, and there has been no indication or notice of termination or
intent to terminate given, orally or in writing, by any such party.
(d) Except as described on Schedule 1.1(b), no consent or
approval of any other party to any Contract is required for the
assignment of such Contract to Buyer and for the consummation of the
transactions contemplated by this Agreement.
2.9 Title to Assets and Related Matters. Seller owns and has good and
marketable title in and to all of the Assets free and clear of all Encumbrances
and the claims or rights of any other Person and has the full legal power and
authority to transfer the Assets to Buyer. Upon Seller's transfer of the Assets
at Closing as contemplated by this Agreement, Buyer shall acquire right, title,
and interest to the Assets, free of any adverse claim, Encumbrance, right, or
interest of any nature whatsoever. The Assets include all of the Assets used or
relied upon by Seller and the Shareholders in the operation of the Business and
are sufficient for the conduct of the Business as operated by Seller.
2.10 Real Property. Schedule 1.1(c) contains a complete and accurate
description of all of the Real Property. Seller has a valid leasehold or
ownership interest in all of the Real Property. The Real Property is properly
zoned to accommodate the Business and the business activities contemplated by
Buyer. The Real Property has not been sublet or assigned, and Seller is the only
Person in possession of the Real Property. The Real Property is in good
condition and is served with utilities sufficient for the conduct of the
Business as operated by Seller.
2.11 Compliance with Laws. Seller is in compliance with all Legal
Requirements applicable to it, the ownership of the Assets, or the operation of
the Business or any combination thereof, and neither Seller nor the Shareholders
have any basis to expect, nor have any of them received, any Order, notice, or
other communication from any Governmental Authority or other Person of any
alleged, actual, or potential violation of or failure to comply with any such
Legal Requirement. Seller has maintained and currently has in full force and
effect all required, appropriate and customary licenses and Governmental
Authorizations to conduct the Business.
2.12 Litigation. Neither Seller nor the Shareholders are subject to any
Order affecting the Assets, the Business, or Seller's or the Shareholders'
ability to carry out the terms of this Agreement. There are no Proceedings
pending or threatened against Seller or the Shareholders which would affect
Seller's or the Shareholders' ability to carry out the terms of this Agreement
or title to the Assets, and there exist no facts to serve as a basis for any
assertion or institution of any Proceeding.
2.13 No Broker's or Finder's Fees. No agent, broker, investment banker
or similar Person has acted directly or indirectly on behalf of Seller or the
Shareholders in connection with this Agreement or the transactions contemplated
hereby, and no Person, including Seller or the Shareholders, is or will be
entitled to any broker's or finder's fee or any other commission or similar fee
or expense, directly or indirectly, in connection with this Agreement or the
transactions contemplated hereby.
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2.14 Disclosure. No representation or warranty of Seller or the
Shareholders contained in this Agreement or in the schedules to this Agreement
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements herein or therein, in light of
the circumstances under which they were made, not misleading.
2.15 Bankruptcy. Neither Seller nor the Shareholders have made any
assignment for the benefit of creditors, filed any petition in bankruptcy, been
adjudicated insolvent or bankrupt, petitioned or applied to any tribunal for any
receiver, conservator or trustee of any of them or any of their property or
assets, or commenced any action or Proceeding under any reorganization
arrangement, readjustment of debt, conservation, dissolution or liquidation law
or statute or any jurisdiction; and no such action or Proceeding has been
commenced or threatened against Seller, the Shareholders or any Affiliate of
Seller or the Shareholders by any creditor, claimant, Governmental Authority or
any other Person.
2.5 Environmental Matters. Seller has complied and is in compliance in
all respects with all applicable Environmental Laws.
2.6 No Negative Trends. Seller's sales over the last twelve months have
not suffered any significant downturn or negative trends in comparison to the
twelve-month period immediately prior thereto, nor have there been any such
downturns or negative trends in general in connection with the Business of
Seller. Seller has not, within the last twelve months, had a customer whose
business is responsible for 5% or more of Seller's receivables terminate or
threaten to terminate or give notice of termination of its purchasing
relationship with Seller.
2.7 Prepaid Sales. Seller has received no cash or other consideration
in respect of sales, orders, or gift certificates that Seller has not or
fulfilled in all respects as of the Closing Date.
2.19 Intellectual Property.
(a) Schedule 2.19(a) sets forth all Intellectual Property, and
all pending applications for and registrations of any of the foregoing,
owned by Seller identifying by jurisdiction in which each has been
filed or registered with applicable serial or registration numbers.
Seller has, and Buyer will have after the Exchange, the unencumbered,
exclusive right to use, commercialize, exploit and transfer such
Intellectual Property.
(b) Schedule 2.19(b) sets forth all Intellectual Property used
by Seller (other than the Intellectual Property set forth on Schedule
2.19(a)) and describes the lease, license or other agreements pursuant
to which Seller has obtained the right to use such Intellectual
Property. Seller has the absolute right to use, commercialize, exploit
and transfer to Buyer the Intellectual Property described on Schedule
2.19(b) and all other Intangible Assets used by Seller in the conduct
of the Business.
(c) The Intellectual Property set forth on Schedule 2.19(a)
and Schedule 2.19(b) is all of the Intellectual Property that Seller
used in the business of Seller during the periods prior to the Closing
Date and all of the Intellectual Property and necessary for the conduct
of the business of Seller. Seller's use of such Intellectual Property
and the other Intangible Assets does not violate or infringe the rights
of any other Person, and the transfer to Buyer pursuant to the Exchange
of such rights, will not violate or infringe the rights of any other
Person. To the best knowledge of Seller and the Selling Shareholders,
no other Person is infringing the right of Seller any such Intellectual
Property or other Intangible Assets. Seller is not in default (nor with
the giving of notice or lapse of time or both would be in default)
under any license to use such Intellectual Property or any Intangible
Assets.
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2.20 Personnel. Schedule 2.20 contains a true and complete list of all
persons employed by the Seller, and the rate of each such person's compensation,
vacation time, sick leave, and other leave time as of the Closing Date. Seller
is not a party to any contract with any labor organization, and Seller is not a
party to or bound by any employee benefit plan within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or any multiemployer plan within the meaning of Section 3(37) of
ERISA under which any employee or former employee of Seller has any present of
future right to benefits or under which Seller has or may have any present or
future liability. Seller has no fixed or contingent liability or obligation to
or in respect of any person now or formerly employed by Seller and has not
incurred and will not incur any such liability that could become a liability of
Buyer. Unless otherwise specified on Schedule 2.20, there is written agreement
between Seller and any of its employees, and all employees of Seller are
employed on an "at will" basis.
2.21 Consultation with Counsel. Seller and each of the Shareholders
have been advised to, and have had a full opportunity to, consult independent
counsel with respect to this Agreement, the transactions contemplated thereby
and the Exhibits attached thereto. Seller and each of the Shareholders
acknowledge that Stoel Rives LLP has represented Buyer with respect to this
Agreement, and neither Stoel Rives LLP nor any officer or director of the
Company has acted, or is acting, on behalf of Seller or either Shareholders.
2.22 Securities Representations.
--------------------------
(a) Representations Not Made by Buyer. Seller and each of the
Shareholders represents and affirms that none of the following
information has ever been represented, guaranteed or warranted to such
Person, expressly or by implication, by any person: (i) the approximate
or exact length of time that Seller or any Shareholder will be required
to remain a security holder of Buyer; (ii) the percentage of profit
and/or amount of or type of consideration, profit or loss to be
realized, if any, as a result of an investment in Buyer; or (iii) the
possibility that the past performance or experience on the part of
Buyer or any affiliate, or any officer, director, employee or agent of
the foregoing, might in any way indicate or predict the results of
ownership of any of the Shares or the potential success of Buyer's
operations.
(b) Purchase for Own Account. Seller and the Shareholders are
the sole and true parties in interest in acquiring the Shares. Seller
is acquiring the Shares with the intent to distribute the Shares to the
Shareholders within one (1) year of the Closing Date and has no intent
of distributing the Shares to, or manage the Shares with, any person
other than the Shareholders. Each of the Shareholders is acquiring the
Shares for its own account for investment, is not purchasing the Shares
hereby for the benefit of any other person, and has no present
intention of holding or managing the Shares with others or of selling,
distributing or otherwise disposing of any portion of the Shares.
(c) Disclosure and Review of Information. Seller and each of
the Shareholders acknowledges and represents that he/she/it has
received and reviewed a copy of the Current Filings (as defined in
Section 3.5) and been given a reasonable opportunity to review all
documents, books and records of Buyer pertaining to this investment,
and has been supplied with all additional information concerning Buyer
and the Shares that has been requested by Seller or such Shareholder,
has had a reasonable opportunity to ask questions of and receive
answers from Buyer or its representatives concerning this investment,
and that all such questions have been answered to the full satisfaction
of Seller and such Shareholder. Neither Seller nor any Shareholder has
received, and or is receiving, any representations, written or oral,
from Buyer or its officers, directors, employees, attorneys or agents
other than those contained in this Agreement and the Current Filings.
In making his/she/its decision to execute this Agreement and authorize
or participate in the Exchange, each of Seller and each Shareholder has
relied solely upon its review of the Current Filings, this Agreement,
and independent investigations made by it or its representatives
without assistance of Buyer.
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(d) Speculative Investment. Seller and each of the
Shareholders understands that (i) Seller and such Shareholder must bear
the economic risk of the investment in the Shares for an indefinite
period of time because the Shares have not been registered under the
Securities Act of 1933, as amended (the "Securities Act") or qualified
under the Securities Act or the securities laws of any other
jurisdiction and (ii) the investment in Buyer represented by the Shares
is highly speculative in nature and is subject to a high degree of risk
of loss in whole or in part. Seller and each Shareholder has adequate
means of providing for his/its current needs and possible
contingencies, and is able to bear the high degree of economic risk of
this investment, including, but not limited to, the possibility of the
complete loss of the Investor's entire investment and the limited
transferability of the Shares, which may make the liquidation of this
investment impossible for the indefinite future.
(e) Accredited Investor Status. Seller and each of the
Shareholders are "accredited investors" within the meaning of Rule
501(a) promulgated under the Securities Act, in that each such Person
is one of the following: (i) an organization described in Section
501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or
similar business trust, or partnership, not formed for the specific
purpose of acquiring the Shares offered, with total assets in excess of
$5,000,000, (ii) an entity in which all equity owners are accredited
investors (as defined in subsection (iii) below), or (iii) a natural
person whose individual net worth, or joint net worth with that
person's spouse, at the time of his purchase exceeds $1,000,000 or a
natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current
year. Seller has its principal place of business in the state of Utah.
Each of the Shareholders is a resident of the State of Utah.
(f) Investment Experience. Seller and each of the Shareholders
have experience as an investor in securities and each acknowledges that
he/she/it can bear the economic risk of its investment in the Shares.
By reason of Seller's and each of the Shareholders' business or
financial experience or the business or financial experience of its
professional advisors who are unaffiliated with and who are not
compensated by Buyer or any affiliate or selling agent of Buyer,
directly or indirectly, Seller and each of the Shareholders has the
capacity to protect its own interests in connection with its purchase
of the Shares. Seller has not been organized solely for the purpose of
acquiring the Shares.
(g) Restricted Shares. Seller and each of the Shareholders
understands that the Shares are and will be "restricted securities"
under the Securities Act inasmuch as they are being acquired from Buyer
in a transaction not involving a public offering, and that, under the
Securities Act and applicable regulations thereunder, such Shares may
be resold without registration under the Securities Act only in certain
limited circumstances. In this connection, Seller and each of the
Shareholders represents that he/she/it is familiar with Rule 144
promulgated under the Securities Act, as presently in effect, and
understands the resale limitations imposed thereby and by the
Securities Act.
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(h) Legends. The Seller and each of the Shareholders
understands that the certificates evidencing the Shares will bear the
legend set forth below, together with any other legends required by the
laws of the State of Utah and any other state or province with
jurisdiction:
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE STATE
SHARES LAWS AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY
AND NOT WITH A VIEW TO OR FOR SALE IN CONNECTION WITH ANY
DISTRIBUTION THEREOF. THESE SHARES MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, IS IN EFFECT WITH
RESPECT TO SUCH SHARES OR THE COMPANY HAS RECEIVED AN OPINION
IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OF 1933, AS AMENDED, IS AVAILABLE.
The legend set forth above shall be removed by Buyer from any
certificate evidencing any of the Shares only (i) upon receipt by Buyer
of an opinion in form and substance satisfactory to Buyer that such
legend may be removed pursuant to Rule 144 promulgated under the
Securities Act, or (ii) upon confirmation that a registration statement
under the Securities Act is at that time in effect with respect to the
legended Share and that such transfer will not jeopardize the exemption
or exemptions from registration pursuant to which the respective Share
was issued.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
For the purpose of inducing Seller and the Shareholders to enter into
this Agreement and with the knowledge that Seller and the Shareholders will rely
on the following representations and warranties, as of the of Closing Date,
Buyer represents and warrants to Seller and the Shareholders as follows:
3.1 Authority. Buyer has full power and authority to execute and
deliver this Agreement and to perform its obligations hereunder. This Agreement
has been duly and validly executed and delivered by Buyer and constitutes the
legal, valid and binding agreement of Buyer enforceable against Buyer in
accordance with its terms, except as such enforceability may be limited by
bankruptcy and the laws affecting the enforcement of creditors' rights generally
or equitable principles.
3.2 Organization, Existence, Good Standing and Capitalization. Buyer
(i) is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware, (ii) is qualified to do business in every
jurisdiction in which its ownership of property or conduct of business requires
it to qualify (iii) has full corporate power and authority to carry on its
business as now being conducted, to own and operate its properties and assets.
As of the date of this Agreement, the only authorized capital stock of Buyer
consists of 50,000,000 shares of Common Stock, of which 22,972,245 are issued
and outstanding.
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3.3 Litigation. Buyer is not subject to any Order affecting the
business or assets of Buyer or Buyer's ability to carry out the terms of this
Agreement. There are no Proceedings pending and, to the knowledge of Buyer,
threatened against Buyer who would have a material assets on the business or
operations of Buyer or affect Buyer's to carry out the terms of this Agreement.
3.4 Consents and Approvals; No violation. Neither Buyer's execution and
delivery of this Agreement, nor Buyer's consummation of the transactions
contemplated hereby will: (i) violate or conflict with, result in, or require
the creation or imposition of, any Encumbrance upon or with respect to any of
the Assets pursuant to, (ii) require Buyer to make any filing or registration
with, give notice to, or obtain any consent, approval or authorization from any
Governmental Authority or any other Person (including creditors), (iii) result
in a breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or
acceleration) under, any provision of the Articles of Incorporation or Bylaws of
the Buyer, any Legal Requirement binding upon Buyer, any contract, agreement,
license, lease, instrument or other arrangement, or any Governmental
Authorization or other instrument or obligation to which Buyer is a party, or by
which Buyer may be bound or to which any of its assets may be subject.
3.5 No Broker's or Finder's Fees. No agent, broker, investment banker
or similar Person has acted directly or indirectly on behalf of Buyer in
connection with this Agreement or the transactions contemplated hereby, and no
Person, is or will be entitled to any such broker's or finder's fee or any other
commission or similar fee or expense, directly or indirectly, in connection with
this Agreement or the transactions contemplated hereby.
3.6 SEC Filings. Seller has filed all reports, registration statements,
forms and other documents that it is required to file with the Securities and
Exchange Commission (the "SEC"). Seller has made a available to Buyer true and
correct copies of Seller's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 2000, Annual Report on Form 10-KSB for the fiscal year ended March
31, 2000 (as amended), and Proxy Statement on Form 14A for its shareholders
meeting scheduled November 16, 2000 (the "Current Filings"). None of the Current
Filings includes any untrue statement of material fact or omits to state a
material fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading.
ARTICLE 4
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER
The obligations of Buyer to consummate the transactions contemplated by
this Agreement at the Closing are subject to fulfillment of the following
conditions, any one or more of which may be waived in whole or in part by Buyer
in the manner provided for herein.
4.1 Representations and Warranties True at Closing. The representations
and warranties of Seller and the Shareholders contained in this Agreement,
including the schedules to this Agreement, shall be true as of the Closing Date.
The schedules to this Agreement and any other documents referred to herein and
delivered by Seller pursuant hereto (including the Most Recent Balance Sheet)
shall be true, correct and complete with respect to the subject matter thereof
as of the Closing Date.
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4.2 Seller's Performance; Compliance with Agreement. Seller and the
Shareholders shall have performed and complied with all obligations, agreements,
covenants, deliveries and conditions required by this Agreement to be performed
or complied with by it on or before the Closing Date. After the date hereof, the
Business shall have been operated by Seller in the ordinary course and Seller
shall not have taken any action that could be detrimental to the Business or the
Assets.
4.3 Authorization; Third Party Consents. Seller shall have obtained all
consents or approvals necessary to transfer the Assets to Buyer.
4.4 Good Title to Seller. Seller shall have transferred and delivered
all of the Assets to Buyer, free and clear of all Encumbrances, with all
transfer and other taxes, if any, required by the laws of the State of Utah to
be paid by Seller.
4.5 No Litigation. No Proceeding shall be pending or threatened before
any court or quasi-judicial or administrative agency of any Governmental
Authority, in any federal, state, local, or foreign jurisdiction or before any
arbitrator wherein an unfavorable injunction, judgment, Order, decree, ruling,
or charge would (a) prevent consummation of any of the transactions contemplated
by this Agreement, (b) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation, or (c) affect adversely the
right of Buyer to own the Assets, and to operate the Business.
4.6 Due Diligence. Buyer shall have been satisfied, in its sole
judgment, with the results of its due diligence investigation regarding Seller,
the Assets, and the Business.
ARTICLE 5
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER
The obligations of Seller and the Shareholders to consummate the
transactions contemplated by this Agreement at the Closing are subject to the
fulfillment of the following conditions, any one or more of which may be waived
by Seller in the manner provided for herein:
5.1 Representations and Warranties True at Closing. The representations
and warranties of Buyer contained in this Agreement shall be true, correct and
complete in all material respects as of the Closing Date.
5.2 Buyer's Performance; Compliance with Agreement. Buyer shall have
performed and complied with all obligations, agreements, covenants and
conditions required by this Agreement to be performed or complied with by Buyer
on or before the Closing Date.
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ARTICLE 6
COVENANTS OF PARTIES AFTER CLOSING
Each of the parties hereto agrees as follows with respect to the period
beginning immediately after the Closing:
6.1 Further Assurances of Seller and the Shareholders. Seller and the
Shareholders, and each of them, will, upon the request of Buyer from time to
time after the Closing, execute and deliver, and use their best efforts to cause
other Persons to execute and deliver, all such further documents and
instruments, and will do or use their best efforts to cause to be done such
other acts, as Buyer may reasonably request in order to consummate more
completely and make effective the transactions contemplated hereby.
6.2 Noncompetition, Nonsolicitation and Nondisclosure. As a material
term of this Agreement and in order to protect the Goodwill and the trade
secrets and the Business and Assets being purchased by Buyer, Seller and the
Shareholders, jointly and severally, covenant and agree that, during the period
commencing on the Closing Date and continuing for three (3) years:
(a) Neither Seller, the Shareholders, nor any affiliate of
Seller or the Shareholders shall, directly or indirectly, either
individually or on behalf of or with any Person, engage in the Business
(other than on behalf of Buyer) in the State of Utah.
(b) Neither Seller, the Shareholders, nor any affiliate of
Seller or the Shareholders shall, directly or indirectly, either
individually or on behalf of or with any Person, solicit, directly or
indirectly, any person who is, as of the Closing Date, or has been
during the two years preceding the Closing Date, a customer of Seller.
(c) Neither Seller nor the Shareholders shall, nor shall they
cause any of their respective Affiliates to, employ any person employed
by Buyer during the Covenant Period or make any other solicitation with
respect to the employment of such a person, unless Buyer first
terminated the employment of such person.
(d) Unless otherwise required by law or expressly authorized
in writing by Buyer, neither Seller nor Shareholder shall, nor shall
they cause any of their respective Affiliates to use for the benefit of
any person other than Buyer or, disclose directly or indirectly to any
Person not in the employ of Buyer any information concerning the Assets
or the Business or the business activities of Buyer not rightfully in
the public domain, including lists of customers or suppliers, pricing
strategies, business files and records, trade secrets and financial
information.
(e) The parties hereto agree that the scope, duration and
geographic area for which the covenants in this Section 6.2 are to be
effective are reasonable. In the event that any court of competent
jurisdiction finally determines that the scope, time period or
geographic scope of any such covenant is unreasonable or excessive and
that any covenant is to that extent made unenforceable, the parties
agree that the restrictions of this Section 6.2 shall remain in full
force and effect for the greatest scope, the greatest time period, and
within the greatest geographic area that would not render it
unenforceable (and such court is hereby authorized to so modify this
Section 6.2). The parties intend that each of the covenants in Sections
6.2(a), 6.2(b), 6.2(c) and 6.2(d) shall be deemed to be a separate
covenant.
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(f) The covenants of Seller and each of the Shareholders
contained in this Section 6.2 are joint and several and independent of
any covenants of Buyer contained herein or in any other document or
instrument delivered in connection herewith or pursuant hereto, and any
breach by Buyer of any such covenant shall not justify any breach by
Seller or the Shareholders of their respective covenants under this
Section 6.2.
(g) The Shares issued to Seller and the other consideration
provided by Buyer to Seller and the Shareholders hereunder constitute
adequate and sufficient consideration for Seller's and Shareholder's
covenants under this Section 6.2.
6.3 Proration of Taxes/Costs. All personal property taxes and
assessments for 2000 pertaining directly to the Assets and all taxes,
assessments, rent payments and utilities shall be prorated as of the Closing
Date. All personal property taxes and all taxes and assessments to be prorated
in accordance herewith shall be deemed to be equal to the amounts assessed to
Seller with respect to such taxes and assessments for the last full period for
which such taxes or assessments were assessed. Seller shall be responsible for
all taxes and assessments relating to the period prior to the Closing date, and
Buyer shall be responsible for all taxes and assessments arising after and
relating to periods following the Closing. In the event the amount of any tax or
assessment to be prorated in accordance herewith is not ascertainable at the
Closing, such amount shall be deemed to be equal (on a pro rata basis for
partial periods) to the amounts paid by Seller for the last full billing period
relating to each of such items immediately preceding the Closing Date.
6.4 Payment of Costs. Each of Buyer, Seller, and the
Shareholders shall bear his, her or its own costs and expenses (including,
without limitation, fees and expenses of business brokers, legal counsel,
accountants and other facilitators and advisors, except as otherwise
specifically set forth herein) incurred at any time in connection with this
Agreement and the transactions contemplated hereby.
6.5 Market StandOff Agreement. Seller and each of the
Shareholders agree that that, during the period of duration (up to, but not
exceeding 180 days) specified by Buyer and an underwriter of Common Stock or
other securities of Buyer, following the date of the final prospectus
distributed in connection with a registration statement of Buyer filed under the
Securities Act, neither Seller nor such Shareholders shall, to the extent
requested by Buyer and such underwriter, directly or indirectly sell, offer to
sell, contract to sell (including, without limitation, any short sale), grant an
option to purchase or otherwise transfer or dispose of (other than to donees who
agree to be similarly bound) any securities of the Buyer held by he/she/it at
any time during such period except Common Stock included in such registration.
In order to enforce the foregoing covenants, Buyer may impose stop transfer
instructions with respect to the Shares until the end of such period, and Seller
and each Shareholders agrees that, if so requested, he/she/it shall execute and
agreement in the form provided by the underwriter containing terms which are
essentially consistent with the provisions of this Section.
6.6 Nomination of Appointee of Seller to Board. Until the
later of (a) five years from the Closing Date, and (b) the date Seller has
consummated an underwritten public offering, Buyer agrees to include a person
designated by Holland among the nominees for director of Buyer at each annual or
special meeting at which directors are elected.
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6.7 Indemnification for Breach of Contracts. Seller has not
provided Buyer evidence that Seller has obtained consents to assignment of each
of the Contracts which, by its terms, requires consent to assignment or declares
an assignment to be a default. Buyer, Seller and the Shareholders agree that,
after Closing, each will use commercially reasonable efforts to secure all
consents necessary for assignment of all of the Contracts to Buyer. In
consideration of Buyer's willingness to consummate the transactions contemplated
by this Agreement absent all necessary consents, Seller and the Shareholders
jointly and severally unconditionally, absolutely, irrevocably and jointly and
severally agree to and shall defend, indemnify and hold harmless Buyer, and each
of Buyer's officers, directors, employees, successors or from and against, and
shall reimburse Buyer's Indemnified Persons for, each and every Loss threatened
against, paid or incurred by, or imposed on, any Buyer's Indemnified Person,
directly or indirectly, relating to, resulting from or arising out of the
assignment to and assumption by Buyer of the Contracts in violation of terms in
such Contracts requiring (directly or indirectly) prior consent to any
assignment of the Contract by Seller. Any dollar limitations set forth in
Section 7.2 shall not apply to any indemnification obligation arising under this
Section 6.7. The procedures set forth in Section 7.4 shall apply to
indemnification obligations arising under this Section 6.7.
ARTICLE 7
DEFAULT/INDEMNIFICATION
7.1 Default. If Seller or any Shareholder shall breach any of Seller's
or any Shareholders representations, warranties or covenants contained in this
Agreement, Buyer shall give written notice of such breach to the Shareholders
and the Shareholders shall have thirty (30) days after receipt of such notice to
cure the default or breach. If the Shareholders shall not cure such default or
breach within such thirty (30) day cure period, Buyer shall be entitled to
pursue the indemnification relief set forth in Sections 7.2 through 7.4 of this
Article 7 or any other remedy available at law or equity to Buyer.
Notwithstanding anything in this Section 7.1 to the contrary, the notice
requirement and thirty (30) day right to cure period provided for in this
Section 7.1 shall not apply if Buyer has been sued or is threatened with legal
action as a result of Seller's or a Shareholder's default or breach under this
agreement and, in such case, shall be immediately entitled to pursue the
provisions of Sections 7.2 through 7.4. In addition, the thirty (30) day cure
period shall not apply to a breach by Seller of the covenants contained in
Section 6.2 hereof and in the event Seller or the Shareholders shall breach the
provisions of Section 6.2, Buyer shall be entitled to the remedies set forth in
Sections 7.2 through 7.4 and all other remedies available at law or in equity
immediately upon Buyer becoming aware of such breach.
7.2 Indemnification by Seller and the Shareholders. Seller and the
Shareholders jointly and severally unconditionally, absolutely, irrevocably and
jointly and severally agree to and shall defend, indemnify and hold harmless
Buyer, and each of Buyer's officers, directors, employees, successors or assigns
(Buyer and such persons are collectively referred to as the "Buyer's Indemnified
Persons") from and against, and shall reimburse Buyer's Indemnified Persons for,
each and every Loss threatened against, paid or incurred by, or imposed on, any
Buyer's Indemnified Person, directly or indirectly, relating to, resulting from
or arising out of: (a) any inaccuracy in any representation or warranty, any
breach or nonfulfillment of any covenant, agreement or other obligation of
Seller or any Shareholder under this Agreement, the schedules to the Agreement,
or any agreement, certificate or other document delivered or to be delivered by
Seller or one or both Shareholders pursuant hereto in any respect; (b) any claim
made based on facts alleged which, if true, would have constituted any such
inaccuracy, breach or nonfulfillment; (c) the ownership or operation of the
Assets or any activities with respect to the Assets or the Business prior to the
Closing Date; or (d) the application or any violation of, or failure to comply
16
with, any Legal Requirement to or by Seller or any Shareholder prior to the
Closing Date. With respect to matters not involving Proceedings brought or
asserted by third parties, within thirty (30) days after notification from any
of Buyer's Indemnified Persons supported by reasonable documentation setting
forth the nature of the circumstances entitling any or all of Buyer's
Indemnified Persons to indemnity hereunder, Seller and/or the Shareholders, at
no cost or expense to Buyer's Indemnified Persons, shall diligently commence
resolution of such matters in a manner reasonably acceptable to Buyer's
Indemnified Persons and shall diligently and timely prosecute such resolution to
completion; provided, however, with respect to those valid claims that may be
satisfied by payment of a liquidated sum of money and which are not disputed
reasonably and in good faith by Seller or the Shareholders, Seller and/or the
Shareholders shall promptly pay the amount so claimed. If litigation or any
other Proceeding is commenced or threatened by a third party, the provisions of
Section 7.4 below shall control over the immediately preceding sentence.
Notwithstanding anything herein to the contrary, neither Seller nor any
Shareholder shall have any liability under this Section 7.2 unless the aggregate
Loss (or alleged Loss) exceeds $50,000. Moreover, Notwithstanding anything
herein to the contrary, the aggregate liability of Seller and all Shareholders
(jointly and severally) under this Section 7.2 shall not exceed $250,000.
7.3 Indemnification by Buyer. Buyer unconditionally, absolutely and
irrevocably agrees to and shall defend, indemnify and hold harmless Seller and
each Shareholder from and against, and shall reimburse Seller and each
Shareholder for, each and every Loss paid, imposed on or incurred by Seller and
each Shareholder, directly or indirectly, relating to, resulting from or arising
out of any inaccuracy in any representation or warranty or any breach or
nonfulfillment of any covenant, agreement or other obligation of Buyer under
this Agreement or under any agreement, certificate or other document delivered
or to be delivered by Buyer pursuant hereto in any material respect.
Notwithstanding anything herein to the contrary, Buyer shall not have any
liability under this Section 7.3 unless the aggregate Loss (or alleged Loss)
exceeds $50,000. Moreover, Notwithstanding anything herein to the contrary, the
aggregate liability of Buyer under this Section 7.3 shall not exceed $250,000.
7.4 Notice and Defense of Third Party Claims. If any Proceeding shall
be brought or asserted under this Article 7 against an indemnified party or any
successor thereto (the "Indemnified Person") by a third party in respect of
which indemnity may be sought under this Article 7 from an indemnifying person
or any successor thereto (the "Indemnifying Person"), the Indemnified Person
shall undertake the defense, compromise or settlement of such Proceeding with
counsel reasonably satisfactory to the Indemnified Person, and the Indemnifying
Person shall assume and pay all fees, costs and expenses relating to or
associated with the Indemnified Person's defense thereof, including all fees and
costs of counsel and the payment of all costs and expenses in connection
therewith. The Indemnified Person shall not compromise or settle any such
litigation without the consent of the Indemnifying Person, which shall not be
unreasonably withheld. The Indemnified Person shall give prompt written notice
of such Proceeding to the Indemnifying Person; provided, that any delay or
failure to so notify the Indemnifying Person shall relieve the Indemnifying
Person of its obligations hereunder only to the extent, if at all, that the
Indemnifying Person is materially prejudiced by reason of such delay or failure.
Actual or threatened action by a Governmental Authority or other Person is not a
condition or prerequisite to the Indemnifying Person's obligations under this
Article 7. In connection with the Indemnified Person's defense of any such
Proceeding, the Indemnifying Person shall, reasonably and in good faith, assist
and cooperate in the defense thereof. As a condition to asserting any rights
under this Article 7, each of Buyer's Indemnified Persons must appoint Buyer as
its sole agent for all matters relating to any claim under this Article 7.
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ARTICLE 8
TERMINATION
8.1 Termination of Agreement. The parties to this Agreement may
terminate this Agreement as provided below: ------------------------
(a) Buyer and Seller may terminate this Agreement by mutual written
consent at any time prior to the Closing;
(b) Buyer may terminate this Agreement by giving written
notice to Seller at any time prior to the Closing (i) in the event
Seller has breached any material representation, warranty, or covenant
contained in this Agreement in any material respect, Buyer has notified
Seller of the breach, and the breach has continued without cure for a
period of five (5) days after the notice of breach or (ii) if the
Closing shall not have occurred on or before November 15, 2000, by
reason of the failure of any condition precedent under Article 4 hereof
(unless the failure results primarily from Buyer itself breaching any
representation, warranty, or covenant contained in this Agreement); and
(c) Seller may terminate this Agreement by giving written
notice to Buyer at any time prior to the Closing (i) in the event Buyer
has breached any material representation, warranty, or covenant
contained in this Agreement in any material respect, Seller has
notified Buyer of the breach, and the breach has continued without cure
for a period of five (5) days after the notice of breach or (ii) if the
Closing shall not have occurred on or before November 15, 2000, by
reason of the failure of any condition precedent under Article 5 hereof
(unless the failure results primarily from Seller itself breaching any
representation, warranty, or covenant contained in this Agreement).
8.2 Effect of Termination. If any party hereto terminates this
Agreement pursuant to Section 8.1 above, all rights and obligations of such
parties hereunder shall terminate without any Liability of any such party to any
other such party, provided that, if the Agreement is terminated by Buyer
pursuant to Section 8.1(b) or Seller pursuant to Section 8.1(c), the
non-terminating party shall be liable to the terminating party, as liquidated
damages and not as a penalty, for all third party costs and expenses incurred by
the terminating party in connection with the transactions contemplated by this
Agreement in an amount up to $10,000 including, but not limited to, attorneys
and accountants fees, travel expenses, financing costs incurred to finance the
transactions contemplated hereby, and any other out-of-pocket costs or expenses
incurred by the terminating party (including reasonable attorney's fees and
court costs incurred by such party to collect such amounts owed pursuant to this
Section 8.2). The recovery of such costs and expenses shall be the sole and
exclusive remedy of the terminating party hereunder in the event of the
termination of this Agreement as a result of the provisions of Section 8.1(b) or
8.1(c). In the event that a condition precedent to its obligations is not
satisfied, nothing contained herein shall be deemed to require any party to
terminate this Agreement, rather than to waive such condition precedent and
proceed with the Closing. This Agreement shall terminate automatically if the
Closing Date has not occurred on or prior to November 15, 2000.
ARTICLE 9
MISCELLANEOUS
9.1 Survival of Representations and Warranties. All representations and
warranties of the parties hereto shall survive the Closing and continue for a
period of two (2) years.
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9.2 Amendment and Modification. This Agreement may be amended,
modified, terminated, rescinded or supplemented only by written agreement signed
by the parties hereto.
9.3 Waiver; Consents. Any failure of a party to comply with any
obligation, covenant, agreement or condition herein may be waived by each party
affected thereby only by a written instrument signed by the party granting such
waiver. No waiver, or failure to insist upon strict compliance, by any party of
any term or condition or any breach of any term or condition contained in this
Agreement, in any one or more instances, shall be construed to be a waiver of,
or estoppel with respect to, any other term or condition or any other breach of
the same. Whenever this Agreement requires or permits consent by or on behalf of
any party hereto, such consent shall be given in writing in a manner consistent
with the requirements for a waiver.
9.4 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given when (i) delivered
personally, or (ii) sent by telecopier (with receipt confirmed), or (iii)
received by the addressee, if sent by Express Mail, Federal Express or other
express delivery service (receipt requested) or (iv) four (4) days after being
sent by registered or certified mail, return receipt requested, in each case to
the other party at the following addresses and telecopier numbers (or to such
other address or telecopier number for a party as shall be specified in writing;
provided that notices of a change of address or telecopier number shall be
effective only upon receipt thereof):
if to Seller, to:
Ensign Information Systems
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Facsimile: (801) 365 - 0107
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
if to any Shareholder, to the address and/or facsimile number specified
below such Shareholder's name on the signature page hereof;
if to Buyer, to:
Sundog Technologies, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
9.5 Assignment. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by Seller or
any Shareholder without the prior written consent of Buyer. Buyer may freely
assign this Agreement and its rights, interests and obligations hereunder with
or without the consent of Seller.
19
9.6 Severability. Any provision hereof prohibited by or deemed unlawful
or unenforceable under any applicable law of any jurisdiction shall, as to such
jurisdiction, be ineffective without affecting any other provision of this
Agreement. To the full extent, however, that the provisions of such applicable
law may be waived, they are hereby waived to the end that this Agreement be
deemed to be a valid and binding agreement enforceable in accordance with its
terms. In the event that any term or provision of this Agreement shall be held
invalid by a competent court or government agency, the remainder of this
Agreement shall not be affected thereby and the parties hereto shall continue to
be bound by the remaining terms hereof. In such event, the relevant term or
provision (or should such term(s) or provision(s) be a crucial element of this
Agreement, then the entire Agreement) shall be renegotiated by the parties in a
good faith effort to achieve mutual agreement consistent with such holding and
the parties shall continue to perform under this Agreement in a manner
consistent with its intent and objectives.
9.7 Governing Law. This Agreement shall be deemed to have been executed
in the State of Utah and shall be governed by the laws of the State of Utah,
(regardless of the laws that might otherwise govern under applicable Utah
principles of conflicts of law) as to all matters, including matters of
validity, construction, effect, performance, and remedies. The parties agree to
submit to the jurisdiction of the courts in the State of Utah and the United
States District Court, District of Utah, any claims or lawsuits arising form
this Agreement, and waive any objections based on inconvenient forum.
9.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement. This Agreement may be
executed by facsimile signatures, each of which will be deemed an original.
9.9 Entire Agreement. This Agreement, including the instruments,
memoranda, certificates, schedules, exhibits, and other documents referred to
herein, embodies the entire agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, representations, warranties, covenants, or undertakings other than
those expressly set forth or referred to herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
9.10 Attorneys' Fees. In the event any party hereto institutes a
Proceeding against any other party hereto for a claim arising out of or to
enforce this Agreement, the party that prevails by enforcing this Agreement
shall be entitled to recover reasonable attorneys' fees, costs and expenses
incurred, in addition to any other relief to which they may be entitled.
9.11 Construction. This Agreement shall be construed as though all
parties had drafted it. Whenever the context may require, any pronoun used
herein shall include the corresponding masculine, feminine or neuter forms, and
the singular form of nouns, pronouns and verbs shall include the plural and vice
versa. Each of the foregoing genders and plurals is understood to refer to a
corporation, partnership or other legal entity when the context so requires. The
boldfaced and underlined section descriptions shall be and are for reference
only and shall not be deemed to alter to limit the meaning of this Agreement in
any way.
9.12 Non-Exclusivity of Remedies. The rights and remedies of the
parties hereto shall not be mutually exclusive, and the exercise of one or more
of the provisions of this Agreement shall not preclude the exercise of any other
provision. Each of the parties confirms that damages at law may be an inadequate
remedy for a breach or threatened breach of any of the provisions hereof,
including, without limitation, Section 6.2. The respective rights and
obligations hereunder shall be enforceable by specific performance, injunction,
or other equitable remedy, but, except as set forth in Sections 7.2, 7.3 and
8.2, nothing herein contained is intended to or shall limit or affect any rights
at law or by statute or otherwise of any party hereto as against the other party
for a breach or threatened breach of any provision hereof.
20
9.13 Risk of Loss. Seller shall retain all risk of loss with respect to
the Assets until the Assets have been tendered to Buyer at or following Closing.
9.14 Public Announcements. Any public announcement or similar publicity
with respect to this Agreement or the Exchange shall be issued, if at all, at
such time and in such manner as Buyer shall determine. ARTICLE IV
DEFINITIONS
10.1 For the purposes of this Agreement, the following terms shall have
the meanings specified or referred to below whether or not capitalized when used
in this Agreement. Any reference or citation to a law, statute or regulation
shall be deemed to include any amendments to that law, statute or regulation and
judicial and administrative interpretations of it.
(a) "Agreement" means this Asset Purchase and Sale Agreement,
including the exhibits and appendices hereto, which are hereby
incorporated herein.
(b) "Common Stock" means the common stock, $.001 par value of
Buyer.
(b) "Encumbrance" means any lien, pledge, hypothecation,
charge, mortgage, deed of trust, security interest, encumbrance,
equity, trust, equitable interest, claim, easement, right-of-way,
servitude, right of possession, lease tenancy, license, encroachment,
burden, intrusion, covenant, infringement, interference, proxy, option,
right of first refusal, community property interest, legend, defect,
impediment, exception, condition, restriction, reservation, limitation,
impairment, imperfection of title, restriction on the transfer of any
security or other asset, restriction on the receipt of any income
derived from any security or other asset, and restriction on the
possession, use, exercise or transfer of any other attribute of
ownership, whether based on or arising from common law, constitutional
provision, statute, contract or otherwise.
(c) "Environmental Law" means all federal, state, and local
laws, statutes, ordinances and regulations, now or hereafter in effect,
and in each case as amended or supplemented from time to time, and any
judicial or administrative interpretation thereof, including any
judicial or administrative order, consent decree, or judgment, relating
to regulation and protection of human health, safety, the environment
and natural resources (including ambient air, surface water,
groundwater, wetlands, land surface or subsurface strata, wildlife,
aquatic species and vegetation).
(d) "Entity" means any corporation (including any non-profit
corporation), limited liability company, general partnership, limited
partnership, joint venture, joint stock association, estate, trust,
cooperative, foundation, union, syndicate, league, consortium,
coalition, committee, society, firm, company or other enterprise,
association, organization or entity of any nature, other than a
Governmental Authority.
21
(e) "GAAP" means generally accepted United States accounting
principles, consistently applied.
(f) "Goodwill" means all of the goodwill attributable to the
Business.
(g) "Governmental Authority" means any foreign governmental
authority, the United States of America, any State of the United States
of America, any local authority and any political subdivision of any of
the foregoing, any multi-national organization or body, any agency,
department, commission, board, bureau, court or other authority
thereof, or any quasi-governmental or private body exercising, or
purporting to exercise, any executive, legislative, judicial,
administrative, police, regulatory or taxing authority or power of any
nature.
(h) "Governmental Authorization" means any permit (including
any Environmental permit), license, franchise, approval, certificate,
consent, ratification, permission, confirmation, endorsement, waiver,
certification, registration, transfer, qualification or other
authorization issued, granted, given or otherwise made available by or
under the authority of any Governmental Authority or pursuant to any
Legal Requirement.
(k) "Intellectual Property" means all inventions, patents,
improvements related to patented or unpatented inventions, trademarks
and trade names (whether currently or formerly used, including the
names "Ensign Information Systems," "Horizon 2000" and "Ensign
Software"), service marks, assumed names, trade dress, copyrights,
United States, Foreign, state and other applications and registrations
for and with respect to any of the foregoing and renewals and
continuation thereof, in each case with the goodwill symbolized thereby
and associated therewith, software, domain names, websites, e-mail
addresses, and other intellectual property owned by Seller or used by
Seller in its business.
(i) "Legal Requirement" means any law (including any
Environmental Law), statute, ordinance, decree, requirement, Order,
treaty, proclamation, convention, rule or regulation (or interpretation
of any of the foregoing) of, and the terms of any Governmental
Authorization issued by, any Governmental Authority.
(j) "Liability" means any debt, obligation, duty, or liability
of any nature (including any unknown, undisclosed, unfixed,
unliquidated, unsecured, unmatured, unaccrued, unasserted, contingent,
conditional, inchoate, implied, vicarious, joint, several or secondary
liability), regardless of whether such debt, obligation, duty or
liability would be required to be disclosed on a balance sheet prepared
in accordance with GAAP.
(k) "Loss" means any loss, damage, injury, harm, detriment,
decline in value, lost opportunity, Liability, exposure, claim, demand,
Proceeding, settlement, judgment, award, punitive damage award, fine,
penalty, tax, fee, charge, cost or expense (including costs of
attempting to avoid or in opposing the imposition thereof, interest,
penalties, costs of preparation and investigation, and the fees,
disbursements and expenses of attorneys, accountants and other
professional advisors), as well as, with respect to compliance with any
Environmental Law.
(l) [intentionally left blank]
22
(l) "Order" means any order, judgment, injunction, edict,
decree, ruling, pronouncement, determination, decision, opinion,
sentence, subpoena, consent decree, writ or award issued, made, entered
or rendered by any court, administrative agency or other Governmental
Authority or by any arbitrator.
(m) "Ordinary Course of Business" means the ordinary course of
the Business consistent with past custom and practice of Seller,
including with respect to quantity and frequency.
(n) "Person" means any individual, Entity, or Governmental
Authority.
(o) "Proceeding" means any action, suit, litigation,
arbitration, lawsuit, claim, proceeding (including any civil, criminal,
administrative, investigative or appellate proceeding and any informal
proceeding), prosecution, contest, hearing, inquiry, inquest, audit,
examination, investigation, challenge, controversy or dispute
commenced, brought, conducted or heard by or before, or otherwise
involving, any Governmental Authority or any arbitrator.
(r) "Tax" means any federal, state, local or foreign income,
gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, environmental, customs duties, franchise, profits,
withholding, social security (or similar), unemployment, disability,
real property, personal property, sales, use, transfer, registration,
value added, estimated or other tax of any kind whatsoever, including
any interest, penalty or addition thereto, whether disputed or not.
(s) "Tax Returns" means any return (including any information
return), report, statement, declaration, schedule, notice,
notification, form, certificate or other document or information filed
with or submitted to, or required to be filed with or submitted to, any
Governmental Authority in connection with the determination,
assessment, collection or payment of any Tax or in connection with the
administration, implementation or enforcement of or compliance with any
Legal Requirement relating to any Tax.
[intentionally left blank; signature pages follow]
23
IN WITNESS WHEREOF, each of the parties hereto has caused this Asset
Purchase and Sale Agreement dated as of November 1, 2000 to be executed on its
behalf as of the date first above written.
"Buyer"
Sundog Technologies, Inc.
a Delaware corporation
By:
----------------------------
Its:
---------------------------
"Seller"
Ensign Information Corporation,
a ____________ corporation
By:
----------------------------
Its:
----------------------------
The "Shareholders"
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, an individual
Address: ______________________
Facsimile:______________________
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, an individual
Address: ______________________
Facsimile:______________________
24
Schedules and Exhibits
Exhibits
--------
Exhibit A - ▇▇▇▇ of Sale
Exhibit B - Assignment
Exhibit C - Assignment and Assumption Agreement
Exhibit ▇ - ▇▇▇▇▇▇▇ Employment Agreement
Exhibit E - ▇▇▇▇▇▇▇ Employment Agreement
Schedules
---------
Schedule 1.1(a) - Tangible Assets
Schedule 1.1(b) - Contracts
Schedule 1.1(c) - Real Property
Schedule 1.1(g) - Excluded Assets
Schedule 2.19(a) - Owned Intellectual Property
Schedule 2.19(b) - License Intellectual Property
Schedule 2.20 - Employee Information
25
Schedule 1.1(a)
to
Asset Purchase and Sale Agreement
Tangible Assets
[see attached]
26
Schedule 1.1(b)
27
Schedule 1.1(c)
to
Asset Purchase and Sale Agreement
Real Property
Leased office space located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
28
Schedule 1.1(g)
to
Asset Purchase and Sale Agreement
Excluded Assets
[See attached]
29
Schedule 2.19(a)
to
Asset Purchase and Sale Agreement
Owned Intellectual Property
[see attached]
30
Schedule 2.19(b)
to
Asset Purchase and Sale Agreement
Licensed Intellectual Property
None.
31
Schedule 2.20
to
Asset Purchase and Sale Agreement
Employee Information
[see attached]
32
Exhibit A
To
Asset Purchase and Sale Agreement
▇▇▇▇ of Sale
[see attached]
33
▇▇▇▇ of Sale
(Tangible Assets)
THIS ▇▇▇▇ OF SALE is executed and delivered as of November 1, 2000, by
and between Sundog Technologies, Inc., a Delaware corporation ("Buyer") and
Ensign Information Systems, Inc., a Utah corporation ("Seller").
WITNESSETH:
For good and valuable consideration, the receipt and legal sufficiency
of which is hereby acknowledged, Seller hereby agrees as follows:
1. Definitions. All capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Asset Purchase and Sale
Agreement dated of even date herewith, among Seller, Buyer and Seller's
Shareholders (the "Asset Purchase Agreement").
2. Conveyance. Seller hereby grants, bargains, sells, assigns and
transfers unto Buyer all of Seller's right title, and interest in and to the
Tangible Assets including, without limitation, those listed on Schedule 1.1(a)
of the Asset Purchase Agreement.
3. Condition of Owned Assets. The Tangible Assets are being transferred
subject to all applicable representations and warranties set forth in the Asset
Purchase Agreement and subject only to those representations and warranties.
4. Successors and Assigns. This ▇▇▇▇ of Sale shall inure to the benefit
of Buyer and shall be binding upon Seller, and their respective successors and
assigns.
5. Applicable Law. This ▇▇▇▇ of Sale shall be construed, enforced, and
interpreted in accordance with the laws of the State of Utah.
6. No Merger. Nothing contained in this ▇▇▇▇ of Sale is intended to
effect, or shall in any way effect, a merger, elimination, modification or
termination of any covenant, undertaking, representation or warranty or other
matter set forth in the Asset Purchase Agreement. In the event of any
inconsistency between this ▇▇▇▇ of Sale and the Asset Purchase Agreement, the
Asset Purchase Agreement shall control.
[SIGNATURE PAGE FOLLOWS]
34
IN WITNESS WHEREOF, Seller has executed this ▇▇▇▇ of Sale as of the
date first above written.
"Seller"
ENSIGN INFORMATION SYSTEMS, INC.,
a Utah corporation
By: _____________________________________
Name: ________________________________________
Title: _____________________________________
35
Exhibit B
To
Asset Purchase and Sale Agreement
Assignment Agreement
[see attached]
36
Assignment
(Intangible Assets; Records; Current Assets)
THIS ASSIGNMENT is executed and delivered as of November 1, 2000 by
Ensign Information Systems, Inc., a Utah corporation ("Seller") to Sundog
Technologies, Inc., a Delaware corporation ("Buyer").
WITNESSETH:
For good and valuable consideration, the receipt and legal sufficiency
of which is hereby acknowledged, Seller hereby agrees as follows:
1. Definitions. All capitalized terms used herein but and not otherwise
defined shall have the meanings set forth in the Asset Purchase and Sale
Agreement dated of even date herewith, by and among Seller, Buyer and Seller's
Shareholders (the "Asset Purchase Agreement").
2. Conveyance. Seller hereby grants, assigns, transfers, sets over and
delivers to Buyer all of Seller's right, title and interest in and to all of the
Intangible Assets, Records, Current Assets and all other Assets, if any, not
assigned to Buyer pursuant to the ▇▇▇▇ of Sale attached to the Asset Purchase
Agreement as Exhibit A or the Assignment and Assumption Agreement attached to
the Asset Purchase Agreement as Exhibit C.
3. Representations and Warranties. The Intangible Assets, Records,
Current Assets and other Assets are being transferred subject to all applicable
representations and warranties set forth in the Asset Purchase Agreement and
only to such representations and warranties. Buyer agrees, confirms, and
acknowledges that it is not relying upon any representations or warranties
except those found in the Asset Purchase Agreement.
4. Successors and Assigns. This Assignment shall inure to the benefit
of Buyer and shall be binding upon Seller, and their respective successors and
assigns.
5. Applicable Law. This Assignment shall be construed, enforced, and
interpreted in accordance with the laws of the State of Utah.
6. No Merger. Nothing contained in this Assignment is intended to
effect, or shall in any way effect, a merger, elimination, modification or
termination of any covenant, undertaking, representation or warranty or other
matter set forth in the Asset Purchase Agreement. In the event of any
inconsistency between this Assignment and the Asset Purchase Agreement, the
Asset Purchase Agreement shall control.
[SIGNATURE PAGE FOLLOWS]
37
IN WITNESS WHEREOF, Seller has executed this Assignment as of the date
first above written.
"Seller"
ENSIGN INFORMATION SYSTEMS, INC.,
a Utah corporation
By: _______________________________________
Name: ________________________________________
Title: _____________________________________
38
Exhibit C
To
Asset Purchase and Sale Agreement
Assignment and Assumption Agreement
[see attached]
39
Assignment and Assumption Agreement
(Contracts)
This Assignment and Assumption Agreement (the "Agreement") is made and
entered into as of November 1, 2000 (the "Effective Date"), by and between
SUNDOG TECHNOLOGIES, INC., a Delaware corporation, ("Buyer") and ENSIGN
INFORMATION SYSTEMS, INC., a Utah corporation ("Seller").
Background:
A. Buyer, Seller and Seller's Shareholders have entered into that
certain Asset Purchase and Sale Agreement dated of even date herewith (the
"Asset Purchase Agreement").
B. Pursuant to the Asset Purchase Agreement, Seller has agreed to
assign, and Buyer has agreed to assume, certain contracts, leases, and licenses
as set forth on Schedule 1.1(b).
Agreement:
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein and for other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Definitions. All capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the
Asset Purchase Agreement.
2. Assignment. Effective as of 12:01 a.m. on the Closing Date (the
"Cut-Off Time"), Seller hereby assigns to Buyer, and Buyer hereby accepts from
Seller, all of Seller's right, title and interest in, to, and under the
contracts, leases and licenses described on Schedule 1.1(b) attached hereto (the
"Contracts").
3. Assumption. Buyer hereby assumes and agrees to hereafter pay,
discharge and perform when due all the liabilities and obligations of Seller
arising under the Contracts from and after the Cut-Off Time. Buyer does not
assume any liability or obligation arising under the Contracts under to the
Cut-Off Time.
4. No Merger. This Agreement is made pursuant to the terms of the Asset
Purchase Agreement and does not create any additional obligations, covenants,
representations and warranties or alter or amend any of the obligations,
covenants, representations and warranties contained in the Asset Purchase
Agreement. In the event of any inconsistency between this Agreement and the
Asset Purchase Agreement, the Asset Purchase Agreement shall control.
5. Counterparts. To facilitate execution, this Agreement may be
executed in as many counterparts as may be required. It shall not be necessary
that the signature on behalf of both parties hereto appear on each counterpart
hereof, and it shall be sufficient that the signature on behalf of each party
hereto appear on one or more counterparts. All counterparts shall collectively
constitute a single agreement. Facsimile copies of this Agreement shall have the
same effect as originals.
40
6. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
7. Applicable Law. This Agreement shall be construed, enforced, and
interpreted in accordance with the laws of the State of Utah.
8. Schedules. All Schedules referred to herein and attached hereto are
incorporated by this reference.
[SIGNATURE PAGE FOLLOWS]
41
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Assignment and Assumption Agreement as of the date first set forth above.
"Buyer"
SUNDOG TECHNOLOGIES, INC.
a Delaware corporation
By: ________________________________________
Name: _________________________________________
Title: ______________________________________
"Seller"
ENSIGN INFORMATION SYSTEMS,
a Utah corporation
By: ________________________________________
Name: _________________________________________
Title: ______________________________________
42
Exhibit D
To
Asset Purchase and Sale Agreement
Holland Employment Agreement
[see attached]
43
Exhibit E
To
Asset Purchase and Sale Agreement
▇▇▇▇▇▇▇ Employment Agreement
[see attached]
44