Exhibit 10.1
ASSET PURCHASE AGREEMENT
BETWEEN
PCS EDVENTURES!.COM, INC.
AS BUYER
AND
EDUCATION ENTERPRISE SOLUTIONS, LLC
AND
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, AND ▇▇▇▇ ▇▇▇▇▇▇▇▇
AS SELLERS
EFFECTIVE AUGUST 31, 2006
TABLE OF CONTENTS
Page
ARTICLE 1 PARTIES. . . . . . . . . . . . . . . . . . . . . . . .1
1.1 Buyer. . . . . . . . . . . . . . . . . . . . . . . . .1
1.2 E2S. . . . . . . . . . . . . . . . . . . . . . . . . .1
1.3 Members. . . . . . . . . . . . . . . . . . . . . . . .1
1.4 Sellers. . . . . . . . . . . . . . . . . . . . . . . .1
1.5 Successors and Assigns . . . . . . . . . . . . . . . .1
ARTICLE 2 PURCHASE AND SALE. . . . . . . . . . . . . . . . . . .1
2.1 Transfer and Assumption. . . . . . . . . . . . . . . .1
2.2 Possession . . . . . . . . . . . . . . . . . . . . . .2
2.3 Purchase Price . . . . . . . . . . . . . . . . . . . .2
2.4 Form of Payment. . . . . . . . . . . . . . . . . . . .2
2.4.1 Buyer's Stock . . . . . . . . . . . . . . . . .2
2.4.2 Royalty Fees. . . . . . . . . . . . . . . . . .2
2.5 Risk of Loss . . . . . . . . . . . . . . . . . . . . .2
ARTICLE 3 ASSETS INCLUDED IN AND LIABILITIES EXCLUDED FROM SALE.3
3.1 Transfer of Assets . . . . . . . . . . . . . . . . . .3
3.2 Exclusion of Liabilities . . . . . . . . . . . . . . .3
3.2.1 Account Payables and Purchase Orders. . . . . .3
3.2.2 Notes Payable . . . . . . . . . . . . . . . . .3
3.2.3 Distributions.. . . . . . . . . . . . . . . . .3
3.2.4 Rent Payable. . . . . . . . . . . . . . . . . .3
3.2.5 Employment Liabilities. . . . . . . . . . . . .4
3.2.6 Transaction Taxes . . . . . . . . . . . . . . .4
3.2.7 Taxes and Tax Compliance. . . . . . . . . . . .4
3.2.8 Litigation and Judgments. . . . . . . . . . . .4
3.2.9 Errors and Omissions. . . . . . . . . . . . . .4
ARTICLE 4 REPRESENTATIONS, WARRANTIES, AND COVENANTS OF SELLERS.4
4.1 Organization, Good Standing, and Qualification . . . .4
4.2 Authority To Contract. . . . . . . . . . . . . . . . .5
4.3 No Limit On Authority. . . . . . . . . . . . . . . . .5
4.4 Clear Title to Assets. . . . . . . . . . . . . . . . .5
4.5 No Default . . . . . . . . . . . . . . . . . . . . . .5
4.6 Tax Lien . . . . . . . . . . . . . . . . . . . . . . .5
4.7 Condition of Tangible Assets . . . . . . . . . . . . .6
4.8 Compliance with Law. . . . . . . . . . . . . . . . . .6
4.9 Litigation Or Claims . . . . . . . . . . . . . . . . .6
4.10 Representations and Warranties Are Independent of Due
Diligence. . . . . . . . . . . . . . . . . . . . . . .6
4.11 Restricted Common Stock. . . . . . . . . . . . . . . .6
4.12 Accredited or Sophisticated Investor . . . . . . . . .7
4.13 Member's Reliance on Advisors. . . . . . . . . . . . .7
4.14 Stock Dilution . . . . . . . . . . . . . . . . . . . .7
4.15 Sufficient Information . . . . . . . . . . . . . . . .7
4.16 Response to Inquiries. . . . . . . . . . . . . . . . .8
4.17 Ability to Withstand Loss. . . . . . . . . . . . . . .8
4.18 No Agency Endorsement. . . . . . . . . . . . . . . . .8
4.19 Investment Purpose . . . . . . . . . . . . . . . . . .8
4.20 Transfer Restrictions; Legends . . . . . . . . . . . .8
ARTICLE 5 REPRESENTATIONS, WARRANTIES, AND COVENANTS OF BUYER. .9
5.1 Organization, Good Standing, and Qualification . . . .9
5.2 Authority To Contract. . . . . . . . . . . . . . . . .9
5.3 No Limit On Authority. . . . . . . . . . . . . . . . .9
5.4 Restricted Buyer Stock . . . . . . . . . . . . . . . .9
ARTICLE 6 FAIR TRADE COVENANTS . . . . . . . . . . . . . . . . 10
6.1 Purpose Of Noncompetition And Confidential Information
Agreements . . . . . . . . . . . . . . . . . . . . . 10
6.2 Noncompetition Agreement, Duration, and Area . . . . 10
6.3 Confidentiality Agreement and Duration . . . . . . . 10
6.4 Inducement of Buyer. . . . . . . . . . . . . . . . . 10
6.5 Acknowledgement by E2S and Members . . . . . . . . . 10
ARTICLE 7 CONDITIONS OF CLOSING. . . . . . . . . . . . . . . . 11
7.1 Conditions Precedent To Obligations Of Buyer . . . . 11
7.1.1 Completion Of Buyer's Due Diligence . . . . . 11
7.1.2 Representations and Warranties True . . . . . 11
7.1.3 Covenants Performed . . . . . . . . . . . . . 11
7.1.4 Third Party Consents. . . . . . . . . . . . . 11
7.1.5 No Litigation . . . . . . . . . . . . . . . . 11
7.1.6 Membership Approval . . . . . . . . . . . . . 12
7.1.7 No Material Adverse Change. . . . . . . . . . 12
7.1.8 Execution and Certification of Resolution of.
Managers. . . . . . . . . . . . . . . . . . . . . . .12
7.1.9 Public Record Searches. . . . . . . . . . . . 12
7.1.10 Removal of Encumbrances and Liens . . . . . . 12
7.1.11 Receipt of Release. . . . . . . . . . . . . . 12
7.1.12 Approval By Board Of Directors. . . . . . . . 12
7.2 Conditions Precedent to Obligations of Sellers . . . 12
7.2.1 Representations and Warranties True . . . . . 13
7.2.2 Consents. . . . . . . . . . . . . . . . . . . 13
7.2.3 Covenants Performed . . . . . . . . . . . . . 13
ARTICLE 8 CLOSING. . . . . . . . . . . . . . . . . . . . . . . 13
8.1 Time, Date, and Place of Closing . . . . . . . . . . 13
8.2 Documents Delivered At and After Closing . . . . . . 13
ARTICLE 9 POST CLOSING COVENANTS - PROVISION OF SERVICES . . . 13
9.1 Provision of Services: December 31, 2006. . . . . . 13
9.2 Provision of Services: As-needed basis. . . . . . . 14
9.3 Purchase Price Offset. . . . . . . . . . . . . . . . 14
ARTICLE 10 REMEDIES. . . . . . . . . . . . . . . . . . . . . . 14
10.1 Survival of Representations, Warranties, and . . . .
Covenants. . . . . . . . . . . . . . . . . . . . . . 14
10.2 Claim. . . . . . . . . . . . . . . . . . . . . . . . 14
10.3 Notice and Claim Procedure . . . . . . . . . . . . . 14
10.4 Indemnity. . . . . . . . . . . . . . . . . . . . . . 15
10.5 Purchase Price Offset. . . . . . . . . . . . . . . . 15
10.6 Attorney Fees and Costs. . . . . . . . . . . . . . . 15
10.7 Rights Cumulative. . . . . . . . . . . . . . . . . . 15
10.8 Nonwaiver of Remedies. . . . . . . . . . . . . . . . 15
10.9 Governing Law, Jurisdiction, and Venue . . . . . . . 16
ARTICLE 11 GENERAL PROVISIONS. . . . . . . . . . . . . . . . . 16
11.1 Notices. . . . . . . . . . . . . . . . . . . . . . . 16
11.2 Payment of Expenses. . . . . . . . . . . . . . . . . 17
11.3 Time of the Essence. . . . . . . . . . . . . . . . . 17
11.4 Entire Agreement . . . . . . . . . . . . . . . . . . 17
11.5 Severability . . . . . . . . . . . . . . . . . . . . 17
11.6 Counterparts . . . . . . . . . . . . . . . . . . . . 17
ARTICLE 12 SIGNATURES. . . . . . . . . . . . . . . . . . . . . 18
ASSET PURCHASE AGREEMENT
Effective as of August 31, 2006 ("Effective Date"), Education Enterprise
Solutions, LLC and ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇, as
"Sellers," and PCS Edventures!.com, Inc., as "Buyer," agree (the "Agreement")
as follows:
ARTICLE 1
PARTIES
1.1 Buyer. PCS Edventures!.com, Inc., an Idaho corporation is the
"Buyer".
1.2 E2S. Education Enterprise Solutions, LLC, a Montana limited
liability company ("E2S"), operates a school management software development
company located in Butte, Montana ("Business").
1.3 Members. ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, and ▇▇▇▇ ▇▇▇▇▇▇▇▇ are the
sole members of E2S ("Members").
1.4 Sellers. E2S and Members are jointly and severally identified as
the "Sellers".
1.5 Successors and Assigns. Subject to any express provisions in this
Agreement regarding restrictions on transfers or assignments, this Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors, assigns, heirs, and personal representatives. Buyer
has the right, in Buyer's sole discretion, to assign all or part of Buyer's
rights and obligations set forth in this Agreement.
ARTICLE 2
PURCHASE AND SALE
2.1 Transfer and Assumption. At the Closing described in Article 8,
and subject to the terms and conditions of this Agreement, Sellers agree to
sell, transfer, and deliver to Buyer, and Buyer agrees to purchase, take
delivery, take assignment, and assume from Sellers: (i) the tangible and
intangible assets specifically identified in Section 3.1 ("Assets"), and (ii)
no liabilities of the Business, including but not limited to those liabilities
specifically identified in Section 3.2 as excluded by this Agreement
("Liabilities").
2.2 Possession. Sellers shall deliver actual possession of the Assets
to Buyer at Closing.
2.3 Purchase Price. At the Closing, the purchase price ("Purchase
Price") to be paid by Buyer to Sellers pursuant to this Agreement is 375,000
shares with a per share value of $0.60 payable in the form of Buyer's Stock
pursuant to Section 2.4.1, plus royalty fees payable as set forth in Section
2.4.2.
2.4 Form of Payment. The Purchase Price shall be paid as follows:
2.4.1 Buyer's Stock. At Closing, Buyer shall issue and deliver to
Sellers 375,000 shares of Buyer's unregistered restricted common stock ("Buyer
Stock").
2.4.2 Royalty Fees. Buyer agrees to pay to E2S a "Royalty Fee" as
follows:
(a) For the period from the Closing until the seventh year
anniversary of the Closing, Buyer shall pay to E2S a Royalty Fee equal to five
percent (5%) of the gross collected revenue of the Buyer related to the use of
the Assets. The Royalty Fee shall be payable solely from revenues collected
by the Buyer, which revenues are directly related to the use and
implementation of the Assets in products of the Buyer, as such revenues are
determined by the Buyer. The Royalty Fee shall be paid to E2S on the 10th day
of each month following the month when the revenues are collected.
(b) For a period from the seventh year anniversary until the
tenth year anniversary of the Closing, the Buyer shall pay to E2S a Royalty
Fee equal to three percent (3%) of the gross collected revenue of the Buyer
related to the use of the Assets. The Royalty Fee shall be payable solely from
revenues collected by the Buyer, which revenues are directly related to the
use and implementation of the Assets in products of the Buyer, as such
revenues are determined by the Buyer. The Royalty Fee shall be paid to E2S on
the 10th day of each month following the month when the revenues were
collected.
2.5 Risk of Loss. Until Closing, Sellers shall assume all risk of
loss or damage with respect to the Assets. In the event of any loss or damage
to all or any material part of the Assets, Buyer shall have the right to (i)
terminate this Agreement, in which event each party shall be fully released
and discharged from any further obligations under this Agreement, (ii) close
the purchase and reduce the consideration by an equitable amount equal to the
loss or damage, the reduction to reduce the amount of the Buyer Stock
delivered at Closing, or (iii) close the purchase and elect to receive all
insurance proceeds paid or payable by reason of the loss or damage.
ARTICLE 3
ASSETS INCLUDED IN AND LIABILITIES EXCLUDED FROM SALE
3.1 Transfer of Assets. The assets ("Assets") purchased by Buyer
shall be Sellers' school management software package, including (without
limitation) all source code; complete functional specifications; user
interaction examples; forward looking market observations and enhancements
(included in any new version of the software); interface designs and notes
(including current and recommended upgrades); clear explanations, algorithms,
logic and source code for all required calculations such as attendance,
scheduling and grades; well documented and annotated database designs, install
scripts and SQL; network topology models; data transfer models; reports; user
feedback; patents, copyrights and all other related intellectual property
rights; and any and all other materials pertinent to the development and
launch of a successful school management software package. The Assets to be
purchased by the Buyer are specifically listed on Schedule 3.1.
3.2 Exclusion of Liabilities. The Buyer does not assume and shall not
be deemed to have assumed any liabilities of E2S or any of the Members, in
connection with the Business or otherwise ("Liabilities"). Notwithstanding
any other provision of this Agreement, as of Closing the Sellers shall remain
solely responsible for all Liabilities of the Business that arise or accrue
prior to or after the Closing, including (without limitation) the following:
3.2.1 Account Payables and Purchase Orders. All liabilities
related to account payables, purchase orders, and commitments of
E2S.
3.2.2 Notes Payable. Any liability or obligation of E2S, relating
to any long-term debt, interest-bearing debt, line of credit or
note payables or other encumbrances, including any accrued
interest concerning the same, including (without limitation) the
▇▇▇▇▇▇▇▇ Mortgage Loan and the BLDC Loan including (i) A/A #57,
(ii) EDA #100 SchoolWorks, (iii) EDA #114 E2S and (iv) IRP #56
(#3) SchoolWorks, and accrued interest payable on the same.
3.2.3 Distributions. Any liability for accrued distributions,
declared by the manager or members of E2S and payable to the
members.
3.2.4 Rent Payable. Any liability for rent payable, with respect
to any property leased by E2S.
3.2.5 Employment Liabilities. Any liability for employment
obligations, including (i) federal, state and local income,
withholding, trust fund or other employment related taxes,
(ii) wages and salaries, (iii) commissions, (iv) incentives,
overtime or bonuses, (v) compensatory time, (vi) pension plan,
investment plan, profit sharing plan or other plan contributions,
(vii) medical insurance premiums, (viii) medical benefits,
(ix) accrued vacation, (x) sick leave, (xi) holiday pay,
(xii) penalties, fines or payments related to any cash or non-cash
employment benefits or compensation, (xiii) workers compensation,
(xiv) unemployment, (xv) workers' compensation, (xvi) severance,
(xvii) any other obligations related to cash or non-cash
employment benefits or compensation, and (xviii) any employee
benefit plan and any liability or obligation of Sellers for or
under any employee benefit plan.
3.2.6 Transaction Taxes. Any liability or obligation relating to
income, sales or excise taxes arising from, related to or caused
by the transactions contemplated by this Agreement, which taxes
shall be paid by Sellers.
3.2.7 Taxes and Tax Compliance. Any liability or obligation of
Sellers arising prior to, on or after the Effective Date relating
to (i) federal, state, and local taxes, including income, sales or
use, property, service or other taxes, and (ii) compliance with
federal, state, and local tax rules and regulations, including the
obligation to prepare, report or file payroll, income, excise,
sales, social security, trust fund, unemployment, withholding,
property or other notices, forms, reports or documents.
3.2.8 Litigation and Judgments. Any litigation, arbitration or
mediation, and any amounts payable to resolve disputes, if any,
including but not limited to judgments, settlements, arbitration
or mediation.
3.2.9 Errors and Omissions. Any liability or amounts payable
arising from or related to any claims of errors and omissions
occurring prior to the Closing.
ARTICLE 4
REPRESENTATIONS, WARRANTIES, AND COVENANTS OF SELLERS
Sellers jointly and severally represent, warrant, and covenant to Buyer
as follows:
4.1 Organization, Good Standing, and Qualification. E2S is a Montana
limited liability company duly organized, validly existing and in good
standing under the laws of the state of Montana. E2S has full power and
authority to carry on its business as and where now conducted and to own or
lease and operate its properties at and where now owned, leased or operated.
E2S is duly qualified to do business and is in good standing in every
jurisdiction in which the property owned, leased or operated by E2S or the
business conducted by E2S make such qualification necessary, including,
without limitation, the State of Idaho.
4.2 Authority To Contract. E2S and each of the Members has the full
right, power, and authority to execute, deliver, and perform the terms of this
Agreement and all documents and agreements necessary to give effect to the
provisions of this Agreement. The execution, delivery, and consummation of
this Agreement by E2S was duly approved by the members of E2S according to
applicable law and the Articles of Organization and Operating Agreement of
E2S. Upon the execution and delivery of this Agreement by each of the
Sellers, no further action will be necessary to make this Agreement valid and
binding upon each of the Sellers according to its terms.
4.3 No Limit On Authority. The execution, delivery and consummation
of this Agreement by Sellers will not, with the passage of time, the giving of
notice or otherwise, (i) cause any of the Sellers to be in violation or breach
of any law, regulation, judgment, administrative order, contract, agreement or
other restriction to or by which any of the Sellers is subject or bound, or
(ii) result in the acceleration or termination of any loan or security
agreement to which any of the Sellers is a party. There are no restrictions
in the Articles of Organization or Operating Agreement of E2S, or any
membership agreement, indenture, credit agreement or other agreement limiting
the right or power of any of the Sellers to sell the Assets of the Business.
No approval or consent of any person, firm or other entity is required to be
obtained by Sellers for the execution, delivery, and consummation of this
Agreement by Sellers.
4.4 Clear Title to Assets. Except as set forth on Schedule 4.4, E2S
has good and marketable title to the Assets, free and clear of all mortgages,
pledges, security interests, liens, and other encumbrances (collectively,
"Encumbrances").
4.5 No Default. None of the Sellers is in default under the terms of
any contract, agreement, lease, license or understanding to which such Seller
is a party, and which default could, with the passage of time, the giving of
notice or otherwise, result in any Encumbrance on any of the Assets; and
Sellers are not aware of any condition that will result in any such default.
4.6 Tax Lien. There are no tax liens or security interests
encumbering any of the Assets.
4.7 Condition of Tangible Assets. The tangible Assets are suitable
for the purposes used, and have been maintained in accordance with good
business and maintenance practices. Sellers do not know of any material
latent defects in the tangible Assets.
4.8 Compliance with Law. Sellers have not received any notices of
violation of any law, regulation, condition of permit or license, order,
ordinance or any requirement noted in or issued by any federal, state or local
department having jurisdiction over or affecting E2S or any of the Assets that
has not been corrected, resolved or withdrawn, and E2S is and has been
conducted in compliance with all applicable federal, state, and local laws and
regulations in all material respects.
4.9 Litigation Or Claims. There are no claims, actions, suits,
arbitrations, governmental investigations, inquiries or proceedings pending
or, to the knowledge of any of the Sellers, threatened against or involving
any of the Sellers or the Assets, before any court, governmental or
administrative body or agency, or private arbitration tribunal. To the
Sellers' knowledge, there are no facts upon which material claims may be made
against any of the Sellers or any of the Assets, nor are there any outstanding
orders, writs, injunctions or decrees of any court, arbitrator or governmental
agency that adversely affect or could adversely affect the Assets or E2S.
4.10 Representations and Warranties Are Independent of Due Diligence.
Buyer is not and will not be required to undertake any independent due
diligence investigation to determine the truth, accuracy, and completeness of
the representations, warranties, and covenants made by Sellers in this
Agreement. Sellers' representations, warranties, and covenants made to Buyer
in this Agreement are independent of any due diligence investigation done by
Buyer. Buyer's due diligence investigation, if any, (i) does not terminate,
reduce, mitigate or otherwise diminish Sellers' responsibility to fully and
fairly make all representations, warranties, and covenants and disclose all
required information, (ii) does not impute or attribute to Buyer by
implication or otherwise information that should have been discovered in
Buyer's due diligence investigation, (iii) shall not be deemed to ascribe any
knowledge to Buyer different from, or in addition to, the representations and
warranties made by Sellers to Buyer in this Agreement, and (vi) shall not be
deemed to reduce, affect or eliminate Buyer's complete reliance upon the
representations and warranties set forth in this Agreement.
INVESTMENT REPRESENTATIONS
4.11 Restricted Common Stock. Each Member acknowledges and agrees that
the Buyer Stock to be transferred to E2S and thereafter distributed to the
Members by E2S constitutes "restricted securities" as defined in Rule 144
under the Securities Act of 1933 ("1933 Act") and that the Buyer Stock cannot
be offered or sold in the United States or to any person unless the Buyer
Stock is registered under United States federal and applicable state
securities laws or an exemption from registration (such as Rule 144) is
available, and that the Members may not engage in hedging transactions
involving Buyer Stock unless such transactions are in compliance with the 1933
Act. Buyer shall have no obligation to register the Buyer Stock or to
register any transfer of Buyer Stock not made in accordance under the 1933
Act, unless the Buyer Stock is registered under United States federal and
applicable state securities laws or an exemption from registration is
available.
4.12 Accredited or Sophisticated Investor. E2S is acquiring Buyer
Stock in a transaction that does not require registration under the 1933 Act.
Each Member of E2S (i) is an "Accredited Investor" as defined in Regulation D
under the 1933 Act, and in the attached Schedule 4.12, or (ii) alone or,
together with Member's Representative(s) (as defined in Section 4.13), has the
ability to evaluate the merits and risks of an investment in the Buyer Stock
based upon Member's knowledge and experience in financial and business
matters.
4.13 Member's Reliance on Advisors. Neither E2S nor any Member is
relying on Buyer or its directors, officers, employees or other agents or
representatives with respect to the legal, tax, economic and related
considerations of an investment in the Buyer Stock; and each of the Sellers
has relied on the advice of, or has consulted with, only such Seller's own
attorneys, accountants or other financial advisors ("Member's
Representative").
4.14 Stock Dilution. Each Seller acknowledges and agrees that Buyer is
not agreeing to maintain such Seller's percentage ownership in Buyer
(including any Member's percentage ownership in Buyer that results from
distribution of Buyer Stock to such Member by E2S), and that Buyer may issue
additional equity and other securities for any purpose as determined by Buyer,
which issuance of securities may reduce such Seller's percentage ownership
interest in Buyer.
4.15 Sufficient Information. E2S and each Member recognize that an
investment in the Buyer Stock involves significant risks. E2S and each Member
and such Member's Representative(s), if any, have access to materials or have
been furnished materials relating to Buyer, including all of Buyer's reports
and registration statements that have been filed with the United States
Securities and Exchange Commission (the "SEC") at any time prior to the
Closing and which are contained in the ▇▇▇▇▇ Archives located at ▇▇▇.▇▇▇.▇▇▇,
and all materials relating to Buyer, its business and financial condition, and
any other matters which E2S or such Member or Member's Representative has
requested. Each Member and such Member's Representative(s), if any, have
received and carefully read unaudited quarterly reports and other information
supplied by Buyer or otherwise publicly available to such Member. Each Member
and such Member's Representative(s), if any, have been afforded the
opportunity to ask questions and receive answers concerning the terms and
conditions of this Agreement and the transfer of Buyer Stock and to obtain any
additional information which Buyer or its management possesses or can acquire
without unreasonable effort or expense and in compliance with securities laws
and regulations, which is necessary to verify the accuracy of the information
provided.
4.16 Response to Inquiries. Buyer has answered all inquiries that each
Member and such Member's Representative(s), if any, have made of it concerning
Buyer, its business or any other matter relating to the Buyer Stock or the
financial condition or results of operation of Buyer.
4.17 Ability to Withstand Loss. Each Member (i) has adequate means of
providing for such Member's current needs and possible personal contingencies,
(ii) has no need for liquidity in such Member's investment in the Buyer Stock,
(iii) is able to bear the economic risks of such Member's investment in the
Buyer Stock, and (iv) at the present time, can afford a complete loss of such
investment.
4.18 No Agency Endorsement. Each Seller understands that no federal or
state agency has passed upon the Buyer Stock or made any finding or
determination as to the fairness of the investment or any recommendation or
endorsement of the Buyer Stock.
4.19 Investment Purpose. E2S and, upon distribution of Buyer Stock to
the Member, each Member is acquiring the Buyer Stock for its or his own
account, for investment, and not for distribution, assignment or resale to
others in whole or in part. No other person has any direct or indirect
beneficial interest in the Buyer Stock to be issued pursuant to this
Agreement. Neither E2S nor any Member has any agreement or arrangement,
formal or informal, with any person to sell or transfer all or any part of the
Buyer Stock; and neither E2S nor any Member has any plans to enter into any
such agreement or arrangement.
4.20 Transfer Restrictions; Legends. Sellers acknowledge that each
certificate representing Buyer Stock shall be stamped or otherwise imprinted
with a legend substantially similar to the following (in addition to any
legend required under applicable state securities laws) unless, in the opinion
of counsel for the Buyer, such legend is not required:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
ASSIGNED, PLEDGED OR HYPOTHECATED IN THE UNITED STATES OR TO
ANY U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER THE ACT, OR UNLESS PCS
EDVENTURES!.COM, INC. HAS RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO PCS EDVENTURES!.COM, INC. AND ITS COUNSEL
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
ACT IS AVAILABLE IF SUCH OPINION IS REASONABLY REQUESTED BY
PCS EDVENTURES!.COM, INC.
ARTICLE 5
REPRESENTATIONS, WARRANTIES, AND COVENANTS OF BUYER
Buyer represents, warrants, and covenants to Sellers as follows:
5.1 Organization, Good Standing, and Qualification. Buyer is an Idaho
corporation duly organized, validly existing, and in good standing under the
laws of the State of Idaho. Buyer has full corporate power and authority to
carry on its business as and where now conducted and to own or lease and
operate its properties at and where now owned, leased or operated.
5.2 Authority To Contract. Buyer has the full right, power, and
authority to execute, deliver, and perform the terms of this Agreement and all
documents and agreements necessary to give effect to the provisions of this
Agreement. The execution, delivery, and consummation of this Agreement by the
Buyer was duly approved by the Board of Directors of Buyer according to
applicable law and the Articles of Incorporation and Bylaws of Buyer. Upon
the execution and delivery of this Agreement by Buyer, no further action will
be necessary to make this Agreement valid and binding upon Buyer according to
its terms.
5.3 No Limit On Authority. The execution, delivery, and consummation
of this Agreement by Buyer will not, with the passage of time, the giving of
notice or otherwise, (i) cause Buyer to be in violation or breach of any law,
regulation, judgment, administrative order, contract, agreement or other
restriction to or by which Buyer is subject or bound, or (ii) result in the
acceleration or termination of any loan or security agreement to which Buyer
is a party. There are no restrictions in the Articles of Incorporation,
amendments to the Articles, Bylaws, minutes, share certificates of Buyer,
shareholder agreement, indenture, credit agreement or other agreement limiting
the right or power of Buyer to buy the Assets. No approval or consent of any
person, firm, or other entity is required to be obtained by Buyer for the
execution, delivery, and consummation of this Agreement by Buyer.
5.4 Restricted Buyer Stock. At the time of closing, the Buyer Stock
will not be registered under the United States Securities Act of 1933 ("1933
Act") and will constitute "restricted securities" within the meaning of
Regulation S and Rule 144 promulgated by the United States Securities and
Exchange Commission under the 1933 Act. If at any time in the future the
Buyer applies to register some of its stock under the 1933 Act, it will also
apply to register the Buyer Stock under that Act, subject to the right of the
Buyer or its underwriters, in view of market conditions and/or the
requirements of any future third party investor who may require registration
of Buyer's stock as a condition to its investment, to reduce or eliminate the
number of shares of Buyer Stock proposed to be registered.
ARTICLE 6
FAIR TRADE COVENANTS
6.1 Purpose Of Noncompetition And Confidential Information Agreements.
Sellers acknowledge that Buyer is purchasing the Assets with the expectation
of continuing, existing, and expected future customers and clients. Sellers
agree that Buyer is entitled to a period of time to benefit from the purchase,
and that Sellers should be restricted from competing with Buyer or benefiting
from the Assets and its associated proprietary information purchased by Buyer.
6.2 Noncompetition Agreement, Duration, and Area. For a period of
five (5) years following Closing, E2S and Members jointly and severally agree
not to compete with Buyer. By way of illustration, E2S and Members will not
(i) directly or indirectly solicit, sell or develop school management software
products, or render any school management services or products that were
provided or sold by E2S or Members prior to Closing or by Buyer after Closing,
(ii) become an owner, partner, agent, consultant, stockholder, director or
officer of any person, firm, or entity that directly or indirectly solicits,
sells or develops school management products, or renders any school management
services or products that are provided or sold by E2S or Members prior to
Closing or by Buyer after Closing, (iii) contact or solicit any customers,
clients or employees with whom E2S or any Member had a relationship prior to
Closing or with whom, on behalf of Buyer, any Member had a relationship after
Closing, for the purpose of establishing relationships for any business or
services that directly or indirectly compete with Buyer's business or causing
any client, customer or employee with whom E2S or any Member had a
relationship prior to Closing or with whom, on behalf of Buyer, any Member had
a relationship after Closing to terminate any relationship with Buyer, and
(iv) make any public or private statements to third parties that would be
injurious to the Buyer's business or reputation or would in any way interfere,
directly or indirectly, with the business of Buyer.
6.3 Confidentiality Agreement and Duration. At any time after
Closing, E2S and Member jointly and severally agree to keep confidential and
not disclose to any person any proprietary information related to the Assets
or any other confidential or proprietary information belonging to Buyer.
6.4 Inducement of Buyer. E2S and Members understand and agree that
strict observance of the agreements set forth in Article 6 is a substantial
inducement to the (i) execution and performance of this Agreement by Buyer,
and (ii) placement of Member in a position of trust with respect to Buyer.
6.5 Acknowledgment by E2S and Members. E2S and Members (i) carefully
considered the nature and extent of the restrictions upon E2S and Members and
the rights and remedies conferred upon Buyer under this Article 6, (ii) agree
that the restrictions, rights and remedies are reasonable in time,
application, amount, and effect, (iii) agree that the restrictions are
supported by sufficient consideration and are not disproportionate to the
respective benefits conferred upon E2S and Members by this Agreement, and (iv)
acknowledge that the restrictions will not prevent Members from earning a
living. E2S and Members acknowledge that E2S and Members were advised by
Buyer that E2S and Members should have this Agreement reviewed by counsel, and
has either done so or elected to forego such right.
ARTICLE 7
CONDITIONS OF CLOSING.
7.1 Conditions Precedent To Obligations Of Buyer. The obligations of
Buyer under this Agreement, including Buyer's obligation to close, are, at
Buyer's option, subject to the satisfaction of the following conditions:
7.1.1 Completion Of Buyer's Due Diligence. At or before Closing,
Buyer shall have completed, to Buyer's sole satisfaction, Buyer's
due diligence investigation. Buyer's due diligence investigation
shall include, but not be limited to, verification of all facts
and representations of Sellers, and verification of all facts and
schedules relating to the Assets.
7.1.2 Representations and Warranties True. The representations
and warranties of E2S and Members are true, complete, and accurate
as of the date of this Agreement and as of the date of Closing as
if made as of such date.
7.1.3 Covenants Performed. Sellers have performed all
obligations, covenants, and agreements to be performed prior to
Closing as set forth in this Agreement.
7.1.4 Third Party Consents. Buyer has received written consents
and releases, in the form and content acceptable to Buyer, from
all necessary or desired persons. In particular, but without
limitation, Sellers shall have provided all bills of sale,
assignments, and other instruments of transfer in the form as
Buyer shall reasonably request.
7.1.5 No Litigation. No actions, suits or proceedings of any kind
shall be threatened or pending that relate to E2S or the Assets.
No injunctions, orders, decrees or rulings shall be in effect that
seek to restrain or prohibit, or to obtain damages or other relief
in connection with, the execution or delivery of this Agreement or
the consummation of the transactions contemplated by this
Agreement.
7.1.6 Membership Approval. This Agreement shall have been
approved by unanimous consent of the Members, without any Member
asserting appraisal or dissenter's rights under applicable law.
7.1.7 No Material Adverse Change. No material adverse change in
any laws, regulations, permits, licenses or other governmental or
regulatory requirements affecting Buyer or E2S or the Assets
generally shall have occurred.
7.1.8 Execution and Certification of Resolution of Managers. E2S
shall have executed and delivered to Buyer duly adopted and
certified copies of (i) Resolution of the Managers and (ii)
Resolution of the Members authorizing the execution and delivery
of this Agreement, and all other documents contemplated by this
Agreement.
7.1.9 Public Record Searches. E2S shall have furnished to Buyer
(i) results of public records searches acceptable to Buyer
evidencing that there are no security interests, liens or other
Encumbrances on any of the Assets, and (ii) tax lien and
litigation searches, fictitious business statement filings,
notices or other similar documents that Buyer may require in order
to reflect, perfect or protect the interests of Buyer in the
Assets and to fully consummate all of the transactions
contemplated under this Agreement.
7.1.10 Removal of Encumbrances and Liens. The Assets shall
be free and clear of all encumbrances and liens.
7.1.11 Receipt of Release. The Buyer shall have received a
copy of the "Claim Release" from Butte Local Development
Corporation waiving all rights and claims to the Athena Technology
developed by E2S, a copy of which is attached as Schedule 7.1.11.
7.1.12 Approval By Board Of Directors. The Board of
Directors of Buyer shall, in its discretion, have approved this
Agreement and the transactions contemplated by this Agreement.
7.2 Conditions Precedent to Obligations of Sellers. The obligations
of Sellers under this Agreement, including the obligation to close, are, at
the option of Sellers, subject to the satisfaction of the following
conditions:
7.2.1 Representations and Warranties True. The representations
and warranties of Buyer are true, complete, and accurate as of the
date of this Agreement and as of the date of Closing as if made as
of such date.
7.2.2 Consents. Sellers have received written consents and
releases, in the form and content acceptable to Sellers, from all
necessary or desired persons.
7.2.3 Covenants Performed. Buyer has performed all obligations,
covenants, and agreements to be performed prior to Closing as set
forth in this Agreement.
ARTICLE 8
CLOSING
8.1 Time, Date, and Place of Closing. The parties shall execute the
documents necessary to consummate this transaction and close this transaction
on the same day. The execution of the documents and closing shall take place
in Boise, Idaho (the "Closing"). The Closing shall be effective as of the
close of business on August 31, 2006, the Effective Date. At the Closing,
Buyer shall pay the consideration as provided in this Agreement and Sellers
shall take or shall cause to be taken all the actions as may be required to
put Buyer into full possession or control of the Assets.
8.2 Documents Delivered At and After Closing. Buyer and Sellers shall
deliver all documents as may be required to effect the transactions
contemplated by this Agreement. At any time after Closing, Buyer and Sellers
shall each execute, acknowledge, and deliver any further assignments,
conveyances, and other assurances, documents, and instruments of transfer
reasonably requested by the other, and shall take any other action consistent
with the terms of this Agreement that may reasonably be requested by the other
for the purpose of effecting the transactions contemplated by this Agreement.
ARTICLE 9
POST CLOSING COVENANTS - PROVISION OF SERVICES
9.1 Provision of Services: December 31, 2006. Sellers agree to
deliver to Buyer by December 31, 2006 the following items in form and
substance reasonably satisfactory to Buyer:
(a) UML-based design document which explains the system, design,
and methodologies of the (i) client-based application components and (ii)
Athena PostgreSQL database schema; and
(b) Master Scheduler User's Guide.
9.2 Provision of Services: As-needed basis. Each of the Members
agrees to provide ongoing design and testing support, on an as-needed basis as
determined by the Buyer (collectively with Section 9.1, the "Services"), but
no longer than three years, through the development and deployment phases of
the school management software product development.
9.3 Purchase Price Offset. If the Services set forth in (i) Section
9.1(a) and 9.1(b) are not provided to Buyer by December 31, 2006, or (ii)
Section 9.2 are not provided as agreed upon by the parties, E2S and the
Members, jointly and severally, will be subject to the Buyer's Purchase Price
Offset as set forth in Section 10.5. With respect to Article 9, the amount of
the Purchase Price Offset shall equal a percentage of the Royalty Fee,
proportionate to the percentage of the Services not provided to Buyer as
required under Section 9.1 or Section 9.2. With respect to the Services, the
determination of the proportionate amount of the Services not provided to
Buyer, for any project, shall be determined by the Buyer. For example, if the
Buyer determines that 20% of the Services were not provided by E2S or the
Members to the Buyer, within the applicable time period, the Royalty Fees
payable to E2S during the applicable periods and all future periods, until the
Services are provided in full, shall be reduced by 20%.
ARTICLE 10
REMEDIES
10.1 Survival of Representations, Warranties, and Covenants. The
representations, warranties, and covenants by Buyer and Sellers set forth in
this Agreement, including (without limitation) any representations, warranties
or covenants set forth in any Schedule or other writing delivered pursuant to
this Agreement, shall survive the Closing and shall be deemed to be material
and to have been relied upon by Buyer and Seller.
10.2 Claim. A "Claim" shall be broadly construed to include any (i)
actual or alleged breach of any representation, warranty, covenant or
obligation of a party, (ii) any loss, harm or damage incurred by a party
arising from or related to this Agreement or the transaction contemplated by
this Agreement, and (iii) any punitive and treble damages, interest, penalties
or attorney fees. "Claim" includes (without limitation) any Claims by a third
party, employee or former employee.
10.3 Notice and Claim Procedure. In the event of a Claim, then the
aggrieved party shall provide reasonable written notice to defaulting party of
the breach. From the date of notice, the defaulting party shall have 30 days
to cure the Claim. If the Claim continues after the 30-day cure period, then
the aggrieved party shall have all remedies provided by this Agreement and by
law.
10.4 Indemnity. Notwithstanding any investigation of the Business or
Assets of E2S made by or on behalf of Buyer prior to closing, E2S and Members,
for a period of two years from Closing, jointly and severally agree to defend,
indemnify, and hold Buyer harmless from any and all Claims sustained directly
or indirectly by Buyer, including (without limitation) any breach of the
representations, warranties or covenants of E2S or Members in this Agreement,
uninsured tort liabilities of E2S, any taxes that E2S or any Member becomes
obligated to pay as a result of this transaction, and any undisclosed
liabilities not disclosed in Section 3.2. This obligation to indemnify,
defend and hold Buyer harmless is not limited in any manner by the
consideration received by Sellers under this Agreement.
10.5 Purchase Price Offset. Without limiting the availability of
other remedies, Buyer shall have the right, exercisable upon notice to E2S
specifying in reasonable detail the basis for such setoff, to reduce the
Royalty Fee otherwise deliverable to E2S pursuant to Section 2.4.2 ("Purchase
Price Offset"). The Purchase Price Offset shall be equivalent in value (i) to
the amount which E2S or any Member is obligated to indemnify Buyer under
Section 10.4 or (ii) an amount, as determined under Section 9.3, for violation
of any term of Article 9. The reduction shall occur on or after 30 days after
the end of the cure period set forth in Section 10.3. The exercise of this
Purchase Price Offset right by Buyer in good faith, whether or not ultimately
determined to be justified, will not constitute a breach or event of default
this Agreement. If Sellers shall dispute the reduction of Royalty Fees by
delivering notice to Buyer on or before the date that the deduction shall
occur, Buyer shall withhold delivery of the disputed Royalty Fees pending
resolution of the dispute pursuant to this Agreement.
10.6 Attorney Fees and Costs. If a dispute shall arise as to whether
any party is in default under this Agreement, the prevailing party shall be
awarded reasonable attorney fees and costs in any suit, action or proceeding,
including trial, arbitration, mediation or appeal, as awarded by the court,
arbitrator or mediator.
10.7 Rights Cumulative. Except as expressly provided in this
Agreement, and to the extent permitted by law, any remedies described in this
Agreement are cumulative and not alternative to any other remedies available
at law or in equity.
10.8 Nonwaiver of Remedies. The failure or neglect of a party to
enforce any remedy available by reason of the failure of any other party to
observe or perform a term or condition set forth in this Agreement shall not
constitute a waiver of the term or condition. A waiver by a party (i) shall
not affect any term or condition other than the one specified in the waiver,
and (ii) shall waive a specified term or condition only for the time and in a
manner specifically stated in the waiver.
10.9 Governing Law, Jurisdiction, and Venue. Idaho law shall govern
this Agreement. The state and federal courts of Idaho have jurisdiction. The
venue for mediation, litigation, and all other proceedings shall be located in
Ada County, Idaho.
ARTICLE 11
GENERAL PROVISIONS.
11.1 Notices. All notices and other communications ("Notices") shall
be in writing and may be delivered (i) in person, with the date of notice
being the date of personal delivery, (ii) by United States Mail, postage
prepaid for certified or registered mail, return receipt requested, with the
date of notice being the date of the postmark on the return receipt, (iii) by
fax, with confirmation of the transmittal of the fax and a copy of the fax
deposited on the same day in the United States Mail, with the date of notice
being the date of the fax, (iv) by e-mail, with confirmation of sending of the
e-mail and a copy of the e-mail deposited on the same day in the United States
Mail, with the date of notice being the date of the e-mail, or (v) by
nationally recognized delivery service such as Federal Express, with the date
of notice being the date of delivery as shown on the confirmation provided by
the delivery service. Notices shall be addressed to the following addresses,
or such other address as one party shall provide the other parties:
Buyer: ▇▇▇▇▇▇▇ ▇▇▇▇▇, President
PCS Edventures!.com, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
Legal Counsel to Buyer: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇@▇▇▇▇.▇▇▇
Sellers: ▇▇▇▇▇ ▇▇▇▇▇▇▇, President
Education Enterprise Solutions, LLC.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇@▇▇▇.▇▇▇
Legal Counsel to Sellers: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Kebe
▇▇▇ ▇ ▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
11.2 Payment of Expenses. Buyer and Sellers shall each pay their own
fees and expenses, including fees and expenses of their respective attorneys,
accountants, advisors, agents, and other representatives incidental to the
preparation and performing this Agreement.
11.3 Time of the Essence. Time is of the essence with respect to the
obligations to be performed under this Agreement.
11.4 Entire Agreement. All Schedules to this Agreement constitute a
part of this Agreement. This Agreement, together with the accompanying
Schedules, constitutes the entire, completely integrated agreement among the
parties and supersedes all prior memoranda, correspondence, conversations, and
negotiations.
11.5 Severability. The invalidity of any portion of this Agreement
shall not affect the validity of any other portion of this Agreement. If the
invalidity or unenforceability is due to the unreasonableness of time or
geographical restrictions, the restrictions shall be effective for the period
of time and area as a court may determine to be reasonable.
11.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
ARTICLE 12
SIGNATURES
PCS EDVENTURES!.COM, INC.
Dated: 8/31/2006 By: /s/▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
Its: President
EDUCATION ENTERPRISE SOLUTIONS, LLC
Dated: 8/31/2006 By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
Its: President
MEMBERS
Dated: 8/31/2006 /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
Dated: 8/31/2006 /s/▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
Dated: 8/31/2006 /s/▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇
Schedule 3.1
LIST OF TRANSFERRED ASSETS
E2S technology consists of Java-based client application components and online
web-based components that cater to the education industry as a student
information management system (▇▇▇▇).
Client-based Application Components:
* E2S Office This is a Java-based application used to manage a variety
of student data, namely attendance, reports, class schedules,
transcripts, grades, etc.
* E2S Classroom This is a Java-based application used to manage a
variety of student data from the classroom point of view, namely
attendance, classroom reports, grades, comments, progress reports, etc.
* E2S InTouch This is a web-based application that uses Java-based JSP
technology. InTouch is used to allow parents, students, and teachers to
login via the Internet and view and/or modify student information.
Parents and students may look at grades, comments, discipline records,
attendance, etc. Teachers may use online attendance sheets, grade
books, and comment management.
* E2S Master Scheduler This is a Java-based application that attempts to
create a school's yearly master schedule.
E2S Client-based Application Component Documentation:
* Existing E2S Office User's Guide
* Existing E2S Classroom User's Guide
SCHEDULE 4.4
ASSETS WITHOUT CLEAR TITLE
None.
Schedule 4.12
DEFINITION OF ACCREDITED INVESTOR
"Accredited investor" means any person who comes within any of the
following categories, or who the Buyer reasonably believes comes within any of
the following categories, at the time of the sale of the securities to that
person:
1. Any director or executive officer of the Buyer.
2. Any 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, inclusive of home, furnishings, and automobiles.
3. Any 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.
4. Any trust, with total assets in excess of $5,000,000, not formed
for the specific purpose of acquiring the Buyer Stock, whose
purchase is directed by a person who, either alone or together
with his advisors, has such knowledge and experience in financial
and business matters that he is capable of evaluating the merits
and risks of investment in the Buyer Stock.
5. Any entity in which all of the equity owners are accredited
investors.
6. Any bank as defined in section 3(a)(2) of the Securities Act of
1933 ("Act"), or any savings and loan association or other
institution as defined in section 3(a)(5)(A) of the Act whether
acting in its individual or fiduciary capacity; any broker or
dealer registered pursuant to section 15 of the Securities
Exchange Act of 1934; any insurance company as defined in section
2(13) of the Act; any investment company registered under the
Investment Company Act of 1940 or a business development company
as defined in section 2(a)(48) of that Act; any Small Business
Investment Company licensed by the U.S. Small Business
Administration under section 301(c) or (d) of the Small Business
Investment Act of 1958; any plan established and maintained by a
state, its political subdivision, or any agency or instrumentality
of a state or its political subdivisions, for the benefit of its
employees, if such plan has total assets in excess of $5,000,000;
any employee benefit plan within the meaning of the Employee
Retirement Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in section 3(21) of such
act, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or if the
employee benefit plan has total assets in excess of $5,000,000 or,
if a self-directed plan, with investment decisions made solely by
persons that are accredited investors.
7. Any private business development company as defined in section
202(a)(22) of the Investment Advisers Act of 1940.
8. Any organization described in Section 501(e)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust,
or partnership, not formed for the specific purpose of acquiring the
Buyer Stock, with total assets in excess of $5,000,000.
SCHEDULE 7.1.11
CLAIM RELEASE
ASSIGNMENT AND RELEASE
WHEREAS, effective as of August 31, 2006, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
and ▇▇▇▇ ▇▇▇▇▇▇▇▇ (collectively the "Members"), entered the "Asset Purchase
Agreement between PCS Edventures!.com, Inc. as Buyer and Education Enterprise
Solutions, LLC and ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, and ▇▇▇▇ ▇▇▇▇▇▇▇▇ as sellers
(the "Purchase agreement"):
WHEREAS, pursuant to the Purchase Agreement, E2S sold to PCS
Edventures!.com, Inc. (the "Company") certain Assets;
In exchange for the consideration set forth in the Purchase Agreement,
this Assignment and Release ("Release") is given by the Members. Any
capitalized terms not herein defined shall have the meaning as set forth in
the Purchase Agreement.
1. Representation and Warranty. The Members represent and warrant to
the Company that E2S owns all rights, title and interest in the Assets.
2. Assignment and Release of Interest: Notwithstanding the forgoing,
the Members convey to the Company any and all right, title or interest in, and
any claim the Members have of could assert, if any, to the school management
software package, including (without limitation) all source code; complete
functional specification; user interaction examples; forward looking market
observations and enhancements (included in any new version of the software);
interface designs and notes (including current and recommended upgrades);
clear explanations, algorithms, logic and source code for all required
calculations such as attendance, scheduling and grades; well documented and
annotated database designs, install scripts and SQL, network topology models;
data transfer models; reports; user feedback; patents, copyrights and all
other related intellectual property rights; and any and all other materials
pertinent to the development , and launch of a successful school management
software package.
3. Governing Law, Jurisdiction, and Venue. Idaho law shall govern
this Agreement. The state and federal courts of Idaho have jurisdiction. The
venue for meditation, litigation, and all other proceedings shall be located
in Ada County, Idaho.
IN WITNESS WHEROF, the Members execute this Release as of the date set
forth below.
MEMBERS
Dated: 8/30/06 /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
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Dated: 8/30/06 /s/▇▇▇▇▇ ▇▇▇▇▇
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Dated: 29/08/06 /s/▇▇▇▇ ▇▇▇▇▇▇▇▇
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