Exhibit 2.1
AGREEMENT OF PURCHASE AND SALE OF ASSETS
This Agreement of Purchase and Sale of Assets (the "Agreement") is
entered into this the 31st day of July, 2003 but effective as of February 1,
2003 (the "Effective Date"), by and among Kingdom Communications Group, INC. , a
Nevada corporation (the "Buyer"), Blue Hill Media, INC., a Virginia corporation
(the "Seller"). Buyer and Seller may be hereinafter sometimes referred to
collectively as the "Parties" or singularly as a "Party."
W I T N E S S E T H :
WHEREAS, the Seller is the owner of certain assets associated with the
Business (as hereinafter defined);
WHEREAS, ▇▇▇▇▇ ▇▇▇▇ owns all of the issued and outstanding capital
stock of the Seller;
WHEREAS, the Buyer desires to purchase substantially all of the Assets
(as hereinafter defined) owned by the Seller and used in the Business, and the
Seller desires to sell such Assets to the Buyer;
WHEREAS, in connection with the purchase and sale of such Assets, the
Parties desire to provide for certain terms and conditions with respect to the
transfer of such assets;
NOW, THEREFORE, for and in consideration of the mutual covenants,
agreements, representations and warranties contained in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged and confessed, the Parties hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used herein, the following terms shall have the following meanings:
1.1 Accounts Receivable. The term "Accounts Receivable" shall mean all
accounts receivable and other rights to payment of money and all rights in and
to any returned, reclaimed and repossessed goods, together with all rights,
claims, counterclaims, titles, securities, security interests, liens and
guaranties evidencing, securing, guaranteeing payment of, relating to or
otherwise with respect to such accounts receivable and all rights, including any
rights to recoupment, recovery, reclamation and resale to the extent they exist
prior to the Closing.
1.2 Affiliate. The term "Affiliate" of a person shall mean, with
respect to that person, a person who directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
or is acting as agent on behalf of, or as an officer or director of that person.
As used in the definition of Affiliate, the term "control" (including the
terms "controlling," "controlled by," or "under common control with") means the
possession of the right of ability, directly or indirectly, to direct the
management and policies of a person whether through the ownership of voting
securities, by contract, through the holding of a position as a director or
officer of such person, or otherwise. As used in this Section, the term "person"
means an individual, a corporation, a partnership, an association, a joint stock
company, a trust, an unincorporated organization, or a government or political
subdivision thereof.
1.3 Assets. The term "Assets" shall have the meaning set forth in
Section 2.1.
1.4 Assumed Liabilities. The term "Assumed Liabilities" shall have the
meaning set forth in Section 2.4.
1.5 ▇▇▇▇ of Sale. The term "▇▇▇▇ of Sale" shall have the meaning set
forth in Section 5.2(a).
1.6 Books and Records. The term "Books and Records shall have the
meaning contained in Section 2.1(c).
1.7 Business. The term "Business" shall mean the operating of an
ongoing Card-Deck Mailer known as Ministry Values for Growing Churches division
of the Seller.
1.8 Buyer Indemnified Parties. The term "Buyer Indemnified Parties"
shall have the meaning set forth in Section 6.1A.
1.8.1 Card Deck Mailer or Mailing. The term Card Deck Mailer or Mailing
shall mean the direct response mailing portion of the Business.
1.9 Closing. The term "Closing" shall mean the consummation of the
events and transactions to take place on the Closing Date.
1.10 Closing Date. The term "Closing Date" shall mean 12:01 a.m. on
July 31, 2003 or such earlier date as the Parties mutually agree.
1.11 Contracts. The term "Contracts" shall have the meaning as
contained in Section 2.1(d).
1.12 Effective Date. The term "Effective Date" shall have the meaning
contained in the introductory paragraph hereof.
1.13 Employee. The term "Employee" shall mean any employee of the
Seller who, as of the Closing Date, is employed or otherwise performs work or
provides services in connection with the operation of the Business, including
those, if any, on disability, sick leave, layoff or leave of absence, who, in
accordance with the Seller's applicable policies, are eligible to return to
active status.
1.14 Employment Agreements. The term "Employment Agreements" shall
mean, collectively, each of those certain employment agreements to be entered
into as of the Closing Date by and between the Buyer and current employees.
1.14 Equipment. The term "Equipment" shall have the meaning as
contained in Section 2.1(a).
1.15 Excluded Assets. The term "Excluded Assets" shall have the meaning
as contained in Section 2.2.
1.16 Financial Statements. The term "Financial Statements" shall have
the meaning as contained in Section 3.16.
1.18 Intellectual Property. The term "Intellectual Property" shall have
the meaning as contained in Section 2.1(g).
1.19 Investor Representation Agreement. The term "Investor
Representation Agreement" shall have the meaning set forth in Section 5.12.
1.20 Kingdom Ventures. The term "Kingdom Ventures" shall mean Kingdom
Ventures, Inc., a Nevada corporation.
1.21 Kingdom Ventures Stock. The term "Kingdom Ventures Stock" shall
mean 100,000 shares restricted common stock of Kingdom Ventures, par value $.001
per share.
1.22 Material Agreements. The term "Material Agreements" shall have the
meaning set forth in Section 3.3.
1.23 Non-Competition Agreements. The term "Non-Competition Agreements"
shall have the meaning set forth in Section 13.
1.24 Notice of Action. The term "Notice of Action" shall have the
meaning set forth in Section 6.1C.
1.25 Notice of Election. The term "Notice of Election" shall have the
meaning set forth in Section 6.1C.
1.26 Offered Employee. The term "Offered Employee" shall have the
meaning set forth in Section 5.6.
1.27 Purchase Price. The term "Purchase Price" shall mean the
consideration payable to the Seller for the Assets as set forth or contemplated
in Section 2.3.
1.28 Real Property. The term "Real Property" shall mean the real
property located at Various locations where the Business is operated.
1.29 Retained Employee. The term "Retained Employee" shall mean any
Employees who are not Offered Employees.
1.30 Retained Liabilities. The term "Retained Liabilities" shall have
the meaning as contained in Section 2.4.
1.31 Seller Indemnified Parties. The term "Seller Indemnified Parties"
shall have the meaning set forth in Section 6.1B.
1.32 Tangible Assets. The term "Tangible Assets" shall have the meaning
as contained in Section 2.1(a).
1.32.1 Seller's Accounts Receivable Rights. The term "Seller's Accounts
Receivable Rights"shall have the meaning as contained in Section 2.1 (l).
1.33 Seller's knowledge, best of Seller's knowledge, or known to
Seller. The term shall mean the actual knowledge of Seller's President,
Secretary and Treasurer and the knowledge that would have been discovered by a
reasonable inquiry.
1.34 Stock. The term "Stock" shall mean those certain 50,000 shares of
Kingdom Ventures Stock S-8 Stock being issued to ▇▇▇▇▇ ▇▇▇▇ an Individual.
1.35 Trade Payables. The term "Trade Payables" shall mean all accounts
payable of Seller generated in connection with the ordinary operation of the
Business prior to the Closing Date as specified on Schedule 3.26.
ARTICLE II
PURCHASE OF ASSETS AND PURCHASE PRICE
2.1 Sale of Assets. Subject to the terms and conditions set forth in
this Agreement, the Seller agrees to sell, convey, transfer, assign and deliver
to the Buyer, and the Buyer agrees to purchase from the Seller as of the
Effective Date, the following assets of Seller (such assets to be collectively
referred to herein as the "Assets"):
(a) All computer hardware, computer software, fixtures,
furniture, office supplies, other supplies and all other tangible
personal property owned or used in connection with the Business
including but not limited to that described on Schedule 2.1(a);
provided, however, that Buyer shall unilaterally have the right to
reject taking title and possession of any of the foregoing as it
determines in its sole discretion (collectively, the "Tangible
Assets");
(b) All right, title and interest, if any, in the maintenance
and use of the Domain name/URL "▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" "
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇.
(c) Copies of all customer and supplier files and lists,
accounting and financial records, sales records, maintenance and
production records, and other books and records relating principally to
the Business (the "Books and Records");
(d) All right, title and interest of Seller in, to and under
all contracts, leases, documents, instruments, agreements, and other
written all relating principally to the Business to which the Seller is
a party or by which the Seller or the Assets may be bound and all of
the Material Agreements as more fully described on Schedule 2.1(d),
which Schedule shall be provided to the Buyer by the Seller no later
than the Closing, as well as all rights, privileges, deposits, letters
of credit, claims, causes of action and options relating or pertaining
to the foregoing (the "Contracts");
(e) All technical data, written specifications, work
standards, confidential information, price lists and know-how used in
connection with the Business;
(f) Copies of all Employee files for those Offered Employees
actually hired by Buyer;
(g) All right, title and interest of Seller, if any, in, to
and under all service marks, trademarks, trade and assumed names,
principally related to the Business including the name "Ministry Values
for Growing Churches," and "▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" as more fully described
on Schedule 2.1(g) (collectively, the "Intellectual Property"),
together with whatever rights Seller may have to recover for
infringement thereon, if any;
(h) All advertising materials and all other printed or written
materials related to the conduct of the Business;
(i) All of the Seller's general intangibles, claims, rights of
set off, rights of recoupment, goodwill, patents, inventions, trade
secrets and royalty rights and other proprietary intangibles, all
telephone numbers, telefax numbers, domain names, urls, and email
addresses utilized in the Business, licenses and sublicenses granted
and obtained with respect thereto, and rights thereunder, which are
used in the Business, and remedies against infringements thereof, and
rights to protection of interests therein under the laws of all
jurisdictions, if any, as more fully described on Schedule 2.1(i)
(collectively, the "General Intangibles");
(j) All goodwill and going concern value and all other
intangible properties related to the Business;
(k) All right, title and interest of Seller in and to all
prepaid fees, bonds, and deposits for services yet to be performed and
relating to any of the Assets or the Business; and
(l) Subject to Seller's right to invoice, for Seller's
account, and to collect, without offset, the first One Hundred Thousand
and No/100 Dollars ($ 100,000) of the Accounts Receivable in connection
with the September 2003 Card Deck Mailing ("Seller's Accounts
Receivable Rights"), the Accounts Receivable with respect to such
September 2003 Card Deck Mailing
2.2 Excluded Assets. Notwithstanding anything to the contrary in
Section 2.1, Assets shall not include: (i) Seller's Accounts Receivable Rights,
Accounts Recievable, cash and cash equivalents including, any savings, checking
or bank accounts, stocks, bonds, notes, cash surrender value of life insurance
policies, and life insurance policies of Seller; (ii) investments; (iii) any
right or interest in any employee benefit plan of the Seller; (iv) the
consideration delivered to Seller pursuant to this Agreement; (v) any and all
automobiles currently owned by Seller or used by Seller in the Business, (vi) a
certain Dell Laptop computer, computer programs and software that are not
assignable, and (vii) any and all other real or personal property, tangible or
intangible, not described in Section 2.1 (collectively, the "Excluded Assets").
2.3 Purchase Price. Upon the terms and subject to the conditions
contained herein, the total consideration to be paid by Buyer to the Seller for
the Assets is $450,000 Dollars (Four Hundred Fifty Thousand) ("Purchase Price").
The Purchase Price shall be paid by Buyer to Seller at the Closing as follows:
2.3.1 Buyer shall execute and deliver to Seller the ▇▇▇▇ of Sale providing for
Buyer's assumption and timely payment and performance of the Assumed
Liabilities;
Buyer's delivery to the Seller of the Stock, which shall be valued for the
purposes of the Purchase Price at $1.00/share regardless of the market price;
50,000 of registered S-8 shares to Seller over the next 90 days: 15,000 shares
on August 30, 2003, 15,000 shares on September 30, 2003, and the remainder
20,000 shares on October 31, 2003; Seller will provide reasonable consulting
services of not more than ten (10) hours each week for the period beginning on
the Closing Date and ending December 31, 2003, on business expansion and
integration with existing Buyers business activity.
Buyer guarantees that the value of said shares will exceed $1.00 per share
within the 180 days period following the Closing Date , In the event that the
value of shares fails to reach $1.00 value during such one hundred and eighty
(180) day period, Buyer shall pay Seller the difference between $1.00 value per
share and the value per share achieved during one hundred and eighty days
following the Closing Date, within thirty (30) days following the end of such
period.
2.3.3 Buyer shall deliver to Seller no later than August 15th , 2003 Kingdom
Ventures Stock; 100,000 shares of unregistered 144 stock in the name of Seller
valued at .50 cents per share for a total of $ 50,000.00
2.3.4 Seller shall assign and Buyer shall assume and pay without offset the Note
payable to AMEN Properties by Seller, as defined further in the attached Note.
Principal Balance on the day of closing not to exceed $ 255,000.00
2.3.5 Buyer's delivery of the sum of One Hundred Thousand and No/100 U.S.
Dollars ($100,000.00) to the Seller as payment of the balance of the Purchase
Price (the "Cash Purchase Price") to be paid on the following schedule: Entire
Cash Purchase Price of $100,000 to be paid to Seller pursuant to Seller's
Accounts Receivable Rights.with respect to the September 2003 Card Deck Mailing.
Should Buyer fail to make appropriate arrangements to mail the September 2003
Card Deck Mailer on or before September 15th, 2003, Buyer will pay seller the $
100,000.00 of Cash Purchase Price within 30 days.
2.4 Assumption of Liabilities. Subject to the exceptions and exclusions
of this Section 2.4, the Buyer agrees that on the Closing Date, it will NOT
ASSUME ANY Liabilities of the Seller other than the Note payable to AMEN
Properties as herein defined. (collectively, the "Assumed Liabilities"). Except
as otherwise specifically provided herein, the Assumed Liabilities shall not
include any other debts, liabilities or obligations, whether accrued, absolute,
contingent or otherwise, in contract or in tort, of the Business or the Seller,
including but not limited to: (i) accrued income taxes; (ii) deferred income
taxes; (iii) accrued franchise taxes; (iv) any tax imposed on the Seller because
of the operation of its Business or otherwise, except sales and use assumed by
Buyer pursuant to this Agreement; (v) any of the liabilities or expenses of the
Seller incurred in negotiating and carrying out their obligations under this
Agreement and the documents contemplated to be executed hereunder; (vi) any
obligations of the Seller under any of its employee benefit plans or agreements;
(vii) any obligations incurred by the Seller before the Closing Date except as
otherwise specifically assumed by Buyer pursuant to this Section 2.4; (viii) any
liabilities or obligations incurred by the Seller in violation of, or as a
result of the Seller's violation of, this Agreement; (ix) liabilities (other
than the obligations assumed under this Section 2.4) arising from the sales of
products or services on or before the Effective Date; (x) liabilities, costs,
and expenses associated with the litigation described in Schedule 3.9 hereto;
and (xi) environmental liabilities and obligations pertaining to the Real
Property other than the obligation to make payments under any lease relating to
the Real Property from and after the Closing Date (all of the foregoing being
hereinafter collectively referred to as the "Retained Liabilities").
2.5 Allocation of Purchase Price. Each of the Parties agrees to report
this transaction for federal income tax purposes in accordance with the manner
agreed upon as set forth in Schedule 2.5.
2.6 Taxes. Seller shall be liable for the payment of all federal and
state income taxes incurred by Seller and arising out of the sale, transfer or
removal of the Assets, if any, and the assumption of the Liabilities. Buyer
shall not be responsible for any business, occupation, withholding or similar
tax, or any taxes of any kind of the Seller, related to any period before the
Closing Date. If sales taxes are imposed on the sale of the Assets, the Seller
shall be obligated to pay the whole amount thereof. Buyer shall reimburse Seller
for 1/2 of any such taxes upon receipt of proof of payment.
2.7 Title to Assets and Risk of Loss. Title to the Assets and risk of
loss or damage to the Assets by casualty (whether or not covered by insurance)
will pass to the Buyer immediately upon completion of the Closing on the Closing
Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller and ▇▇▇▇▇ ▇▇▇▇, jointly and severally, hereby represent and warrant
that:
3.1 Title to Assets. Except as otherwise provided in Schedule 3.1, the
Seller has good, marketable and indefeasible title to the Assets free and clear
of restrictions or conditions to transfer or assignment, mortgages, liens,
pledges, charges, encumbrances, equities, claims, easements, rights-of-way,
covenants, conditions or restrictions. The Seller is in possession of all
property leased to it from others. Except for the Excluded Assets, the Assets
constitute all of the material property, whether real, personal, mixed, tangible
or intangible, that are used in the Business by the Seller.
3.2 Tax Returns. Within the times and in the manner prescribed by law,
including extensions permitted thereunder, the Seller has filed and will file
all federal, state and local tax returns required by law and has paid and will
pay all taxes, assessments and penalties due and payable in connection with the
Business through and including the Closing Date. There are no present disputes
as to taxes of any nature payable by the Seller.
3.3 Contracts. Except as otherwise provided therein Schedule 2.1(d)
lists all of the material contracts, agreements, and other written all relating
principally to the Business, to which the Seller is a party or by which the
Seller or the Assets are bound ("Material Agreements"). Seller has previously
made available to Buyer true and correct copies of all Material Agreements.
Except as otherwise provided in Schedule 2.1(d), each of the Material Agreements
is valid and in full force and effect, and there has not been any default in any
respect by the Seller or any other party thereto, nor has there occurred any
event that with notice or lapse of time or both, would constitute a default in
any respect by the Seller or any other party thereto, which might reasonably be
expected to have a material adverse effect on the financial condition or
operations of the Business. Except as disclosed in Schedule 2.1(d), each of the
Material Agreements is assignable to the Buyer without the consent of any other
party. The Seller will obtain and deliver at Closing all of the requisite
consents relating to the items set forth on Schedule 2.1(d). Seller has not
received notice that any party to any of the Material Agreements intends to
cancel or terminate any of the Material Agreements or exercise or not exercise
any options that they might have under any of the Material Agreements. In the
event any of the Material Agreements is, or is
later determined to be, non-assignable, and the other party to any such Material
Agreements refuses to consent to the assignment of same, then to the extent
legally permissible, the Seller shall subcontract to the Buyer, or its designee,
if the Buyer so desires, the remaining work on such Material Agreements, and the
Seller shall forward to the Buyer, or its designee, all proceeds of such
Material Agreements received by the Seller; provided, however, that Seller shall
be reimbursed for any reasonable out-of-pocket expenses incurred by it.
3.4 Equipment. All of the Tangible Assets owned by the Seller and used in the
Business are described on Schedule 2.1(a) attached hereto. Except as disclosed
on Schedule 2.1(a), none of the Tangible Assets will be, at the Closing Date,
held under any security agreement, conditional sales contract, or other title
retention or security arrangement, or be located other than in the possession of
the Seller on the Real Property.
3.5 Licenses. Schedule 3.5 is a schedule of all licenses and permits owned by
the Seller or in which Seller has any rights or licenses in connection with the
Business. The Seller has not infringed, nor is it now infringing, on any license
belonging to any other person, firm, or corporation. The Seller owns or holds
adequate licenses or other rights to use all licenses and permits necessary for
the Business as now conducted by the Seller, and that use does not, and will
not, conflict with, infringe on or otherwise violate any rights of others.
3.6 Employment Contract. The Seller does not have any written agreements
employment contracts, collective bargaining agreements, pension, bonus, or
profit sharing plans providing for employee remuneration or benefits with
respect to Offered Employees that by their terms or by law will become binding
upon or the obligations of Buyer. The Seller is in compliance with, and upon the
Closing will remain in compliance with, all of its material obligations under
such agreements or other arrangements to the extent that any violation of such
obligations or agreements will not result in a materially adverse affect on the
Business or Assets.
3.7 Compliance with Laws. To Seller's knowledge Seller has complied with, and is
not in violation of, applicable federal, state or local statutes, laws, and
regulations (including, without limitation, any applicable building or other
law, ordinance or regulation) the violation of which would cause a material
adverse affect on the Assets of the Business. As of the Effective Date, there
exist no uncured violations of federal, state or municipal laws, ordinances,
orders, regulations or requirements the violation of which would cause a
material adverse affect on any portion of the Assets or the Business.
3.8 Litigation. Except as disclosed in Schedule 3.8, there is no suit, action,
arbitration or legal, administrative or other proceeding or governmental
investigation pending, or to the best of Seller's knowledge, threatened against
or affecting the Seller, the Assets, or the Business.
3.9 No Breach or Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
default or an event that, with notice or lapse of time or both, would be a
default, breach or violation of any material term (except for third party
consents described in this Agreement or any schedule prepared and delivered in
connection herewith) of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, security agreement or
other agreement, instrument or arrangement by which the Assets, the Business or
the Seller may be materially adversely affected, or to which the Assets, the
Business or the Seller may be bound (the violation of which would materially
adversely affect the Assets, Business and Assets); (ii) an event that would
permit any party to terminate any Contract (the termination of which will
materially adversely affect the Business); (iii) the creation or imposition of
any lien, charge, or encumbrance on any of the Assets or the Business; or (iv) a
breach of any term or provision of this Agreement.
3.10 Due Organization; Authority.
(a) The Seller is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation, and is duly qualified
to do business and is in good standing under the laws of each jurisdiction where
such qualification is required, except where the failure to be so qualified
would not have a material adverse effect on the business, operations, affairs,
prospects, properties, assets or condition (financial or otherwise), of the
Company.
(b) The Seller has the full corporate right, power, legal capacity and authority
to enter into and perform its obligations under this Agreement, and except as
otherwise provided in Schedule 3.10 to this Agreement no approvals or consents
of any persons other than the Seller are necessary in connection herewith.
3.11 Personnel. Schedule 3.11 is a complete and accurate list of all Employees
who principally work for the Business. Prior to, at or after Closing, the Seller
shall deliver such additional information as the Buyer shall reasonably request
with respect to the Offered Employees.
3.12 Valid and Binding Obligations. Upon execution and delivery, this Agreement
and each document, instrument and agreement to be executed by the Seller in
connection herewith, will constitute the legal, valid, and binding obligations
of the Seller, enforceable in accordance with each such agreement's, document's,
or instrument's respective terms, except as may be limited by applicable
bankruptcy laws, insolvency laws, and other similar laws affecting the rights of
creditors generally.
3.13 General Intangibles. Schedule 2.1(g) and Schedule 2.1(i) contain a
description of all of the Intellectual Property and General Intangibles owned by
the Seller and used in the conduct of the Business. Except as provided therein,
the Seller. To Seller's knowledge, Seller is the sole owner of all of the
Intellectual Property and General Intangibles, free and clear of any liens,
encumbrances, restrictions, or legal or equitable claims of others. The
Intellectual Property and the General Intangibles constitute all of the
intellectual property held by Seller in the conduct of the Business and no
adverse claims have been asserted against the Intellectual Property or the
General Intangibles, or the Seller, or the Business with respect thereto. None
of such Intellectual Property or the General Intangibles infringe upon any
patents, trade or assumed names, trademarks, service marks, or copyrights
belonging to any other person, firm, or corporation. Except as provided in
Schedule 2.1(g) or Schedule 2.1(i), the Seller is not a party to any license,
agreement, or arrangement, whether as licensor, licensee, or otherwise, with
respect to any of the Intellectual Property or the General Intangibles.
3.14 Leased Assets. Schedule 3.14 contains an accurate description of all of the
personal property leased or licensed pursuant to the Contracts, which are the
only personal property assets used in the conduct of the Business which are not
owned by the Seller. The Seller is not in default in any material respect of any
lease or any Contract.
3.15 Absence of Certain Changes or Events. To Seller's knowledge since the
Effective Date there has been no:
(i) material adverse change in the condition, financial or otherwise, of the
Seller, the Assets or the Business;
(ii) knowing waiver of any material rights or claims held by the Seller;
(iii) material loss, destruction or damage to any property of the Seller,
whether or not insured;
(iv) material change in the personnel of the Seller or the terms or conditions
of their compensation or employment;
(v) except pursuant to this Agreement, the acquisition or disposition of any
assets (or any contract or arrangement therefor) other than in the ordinary
course of business, nor any other transaction by the Seller otherwise than for
value and in the ordinary course of business;
(vi) transaction by the Seller (other than pursuant to this Agreement), except
in the ordinary course of business;
(vii) capital expenditure by the Seller exceeding $10,000, except in the
ordinary course of business;
(viii) change in accounting methods or practices (including, without limitation,
any change in depreciation or amortization policies or rates) by the Seller;
(ix) re-evaluation by the Seller of any of its assets;
(x) amendment or termination of any contract, agreement or license to which the
Seller is a party (except in the ordinary course of business) the amendment or
termination of which will have a material adverse affect on the Business or the
Assets;
(xi) mortgage, pledge or other encumbrance of any asset of Seller;
(xii) other event or condition of character that has or might reasonably be
expected to have a material adverse effect on the financial condition, Business,
Assets or prospects of the Seller; or
(xiii) agreement by the Seller to do any of the things described in the
preceding clauses (i) through (xii).
3.16 Financial Statements and Other Information; Financial Condition. The Seller
has heretofore furnished to Buyer copies of: (a) the unaudited balance sheets of
the Company at July 28th, 2003 and the related statements of income and cash
flow for the period then ended and (b) the Company's unaudited balance sheet and
Income Statement at July 28th , 2003, and the related statements of income and
cash flow for the period then ended. All financial statements referred to in
this Section 3.16 (the "Financial Statements") are true, complete and correct,
have been prepared in accordance with generally accepted accounting principles
applied on a consistent basis during the respective periods, and fairly present
the financial condition of the Seller as at the respective dates thereof and the
results of operations of the Seller for the respective periods covered by the
statements of income contained therein. The Seller does not have any material
obligations or liabilities, contingent or otherwise, not fully disclosed by the
Financial Statements.
3.17 Consents and Approvals. To Seller's knowledge no consent, approval or
authorization of, or filing or registration with, any governmental or regulatory
authority, or any other person or entity, is required to be made or obtained by
the Seller in connection with the execution, delivery or performance of this
Agreement or the consummation of the transactions contemplated hereby.
3.18 Brokers. Neither the Seller, nor any of its respective officers, directors,
or employees, has employed any broker, agent, or finder, or incurred any
liability for any brokerage fees, agent's fees, commission or finder's fees in
connection with the transaction contemplated herein.
3.19 Sale of Assets. For purposes of determining whether a sales and use tax
charge is applicable, the sale of the Assets constitutes: (i) the sale of
substantially all of the entire operating assets of a business or of a separate
division, branch, or identifiable segment of a business, and (ii) a sale outside
the ordinary course of Seller's business. The income and expenses of the
Business can be separately established from the books of account or records in
the same manner as previously provided to Buyer. Except for the Excluded Assets,
the sale contemplated hereby is the sale of substantially all of the operating
assets of the Business.
3.20 Adverse Information. Neither the Seller, ▇▇▇▇▇ ▇▇▇▇, nor any of the
Employees has information or knowledge of any change contemplated in any
applicable laws, ordinances or restrictions, or any judicial or administrative
action, which might reasonably be expected to have a material adverse effect
upon the Business or the Assets, or their respective values.
3.21 Customers. On the Closing Date, Seller shall have furnished Buyer a true
and correct list of all customers of the Business including customers of Seller
since the Effective Date. Except as indicated in Schedule 3.22, the Seller has
no information, nor is the Seller aware of any facts,
indicating that any of the top 25 customers (based on gross sales) intend to
cease or materially reduce doing business with the Seller.
3.22 Insurance Policies. Schedule 3.23 to this Agreement is a description of all
insurance policies held by the Seller concerning the Business and Assets. The
Seller has maintained and now maintains (i) insurance on all its Assets and
businesses of a type customarily insured, covering property damage and loss of
income by fire or other casualty, and (ii) insurance protection against all
liabilities, claims and risks against which it is customary to insure.
3.23 Interest in Customers, Suppliers and Competitors.Neither the Seller or
▇▇▇▇▇ ▇▇▇▇ has any direct or indirect interest in any competitor, supplier or
customer of the Seller, or in any person from whom or to whom the Seller leases
any real or personal property, or in any other person with whom the Seller is
doing business.
3.24 Absence of Certain Business Practices. Neither the Seller nor any officer,
employee or agent of the Seller, nor any other person acting on their behalf,
has, directly or indirectly, within the past five years, given or agreed to give
any gift or similar benefit to any customer, supplier, government employee of
the United States or any state or foreign government.
3.25 Absence of Creditor and Third Party Claims. The Seller represents and
warrants to the Buyer that (i) the Trade Payables represent legitimate
obligations incurred during the ordinary course of Seller's business and such
Trade Payables are due and owing to the creditors of the Business in the amounts
as set forth on Schedule 3.26, (ii) no creditor or third party claims exist
against the Business except as disclosed on Schedule 3.26 as Trade Payables, and
(iii) no creditor or third party has any basis to bring any claims against the
Buyer except as set forth on Schedule 3.26.
3.26 Accounts Receivable. Attached hereto as Schedule 3.27 is a true and
complete list of all Accounts Receivable owed to the Company as of the date of
this Agreement. All Accounts Receivable are and will be, (a) valid bona fide
claims against debtors for sales or other charges, (b) subject to no defenses,
set-offs, or counterclaims, and (c) collectible in accordance with their terms.
No material additional loss reserves are required with respect to the Accounts
Receivable.
3.27 Disclosure. The Seller has made available to the Buyer true, complete and
correct copies of all Contracts and documents concerning all litigation and
administrative proceedings, licenses, insurance policies, lists of suppliers and
customers, and records relating to the Assets and the Business, and such
information covers all material commitments and material liabilities of the
Seller relating to the Business or Assets referred to herein.
3.28 Full Disclosure. This Agreement, the Schedules and Exhibits hereto, and all
other documents and written information furnished by the Seller to the Buyer
pursuant hereto or in connection herewith, are true, complete and correct, and
do not include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements made herein and therein not
misleading. There are no facts or circumstances relating to the Assets or the
Business which materially adversely affect or might reasonably be expected to
materially adversely affect the Assets, the Business (including the prospects or
operations thereof), or the ability of the Seller to perform this Agreement or
any of their obligations hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants that:
4.1 Due Organization; Authority.
(a) The Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada and has all the necessary
corporate powers to own its properties and to carry on its business as now owned
and operated by it.
(b) Buyer has the right, power, legal capacity, and authority to execute,
deliver and perform this Agreement, and no approvals or consents of any persons
or other entities are necessary in connection herewith. The execution, delivery
and performance of this Agreement by Buyer have been duly authorized.
4.2 Valid and Binding Obligations. Upon execution and delivery hereof, this
Agreement will constitute the legal, valid, and binding obligation of Buyer,
enforceable in accordance with its terms, except as limited by bankruptcy laws,
insolvency laws, and other similar laws affecting the rights of creditors
generally.
4.3 Consents and Approvals. No consent, approval or authorization of, or filing
or registration with, any governmental or regulatory authority, or any other
person or entity, is required to be made or obtained by the Buyer in connection
with the execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby.
4.4 Brokers. Neither Buyer nor any of its respective officers, directors, or
employees, has employed any broker, agent, or finder, or incurred any liability
for any brokerage fees, agent's fees, commissions or finder's fees in connection
with the transactions contemplated herein.
4.5 Certain Proceedings. No suit, action, or other proceeding is pending or, to
Buyer's knowledge, threatened against Buyer before any governmental authority in
which it is sought to restrain or prohibit or to obtain damages or relief in
connection with this Agreement or the consummation of the transaction
contemplated hereby.
4.6 Liabilities and Defaults. To the best of Buyer's knowledge, Buyer is not in
default under, or in breach or violation of, and no reason exists and no event
has occurred which, without notice or lapse of time or action by a third party,
could result in a default under, breach or violation of, any agreement or
instrument to which the Buyer (or any Affiliate of Buyer) is a party which
relates to or arises from the acquisition of all or substantially all of the
assets (or capital stock) of a corporation, limited liability company, sole
proprietor or any other person or entity.
4.7 Untrue Statements. To the best of Buyer's knowledge, this Agreement does not
include any untrue statement of material fact by Buyer or omit to state any
material fact necessary to make the statements made herein by Buyer are not
misleading.
ARTICLE V
THE CLOSING
5.1 Closing. Payment of the Purchase Price required to be made by the Buyer to
the Seller and the transfer of the Assets by the Seller and the other
transactions contemplated hereby shall take place on the Closing Date.
5.2 Seller's Deliveries. The Seller shall deliver or cause to be delivered to
the Buyer at the Closing, the following:
(a) Two (2) duly authorized and executed originals of a ▇▇▇▇ of Sale, Assignment
and Assumption Agreement executed by Seller, together with such other
instruments of assignment and transfer or bills of sale or otherwise as the
Buyer shall reasonably request (the "▇▇▇▇ of Sale");
(b)Two (2) duly authorized and executed originals of that certain
Non-Competition Agreement executed by Seller and ▇▇▇▇▇ ▇▇▇▇.
(c) Such consents, waivers, estoppel letters or similar documentation as the
Buyer shall reasonably request, in the Buyer's sole discretion, in connection
with the transfer of the Assets;
(d) The list of customers and complete Data Base Backup lsiting specified in
Section 3.22;
(e) Intentionally Deleted
(f) Certified resolutions of the Board of Directors, in the form approved by
Seller and Buyer, and shareholders of the Seller granting to the Chairman of the
Board or President of Seller the authority to sell the Assets;
(g) Certified resolutions of the Board of Directors of Blue Hill Media approving
the sale of the Assets and authorizing to Chairman of the Board or President of
Blue Hill Media, ▇▇▇▇▇ ▇▇▇▇, to sign this Agreement and the Guaranty Agreement;
and
(h) All other items required to be delivered hereunder or as may be requested
which are necessary or would reasonably facilitate consummation of the
transactions contemplated hereby.
In addition, the Seller will put the Buyer into possession of all Assets
immediately upon the occurrence of the Closing.
5.3 Buyer's Obligations. The Buyer will deliver or cause to be delivered to the
Seller at or before the Closing, the following:
(a) Intentionally deleted
(b) A stock certificate evidencing all of the Stock issued in the name of the
Seller;
(c) A Kingdom Ventures certificate evidencing the Section 144 shares issued in
the name of the Seller;
(d) Two (2) duly authorized and executed originals of the ▇▇▇▇ of Sale executed
by Buyer;
(e) Intentionally Deleted
(f) Certified resolutions of the Board of Directors of the Buyer;
(g) The list of Offered Employees specified in Section 5.7; and
(h) All other items required to be delivered hereunder or as may be requested or
which are necessary or would reasonably facilitate consummation of the
transactions contemplated hereby.
5.4 Insurance,. The Buyer shall be obligated to procure its own insurance on the
Business commencing on the Closing Date. Seller shall be solely responsible for
receiving a refund of any insurance premium payments that have been prepaid.
5.5 Further Assurances. At and after the Closing, each of the Parties shall take
all appropriate action and execute all documents of any kind which may be
reasonably necessary or desirable to carry out the transactions contemplated
hereby. The Seller, at any time at or after the Closing, will execute,
acknowledge and deliver any further bills of sale, assignments and other
assurances, documents and instruments of transfer, reasonably requested by the
Buyer, and will take any other action consistent with the terms of this
Agreement that may reasonably be requested by the Buyer, for the purpose of
assigning and confirming to the Buyer, all of the Assets. The Buyer shall notify
the Seller promptly, and in no event more than ten (10) business days after the
Buyer's receipt, of any tax inquiries or notifications thereof which relate to
any period prior to the Effective Date, and the Seller shall prepare and deliver
responses to such inquiries as the Seller deems necessary or appropriate. In
addition, the Seller shall make available the books and records of the Business
during reasonable business hours. Following the Effective Date, and without
additional consideration, Buyer shall make available to Seller the books and
records of the Business (as they existed on the Effective Date) for a period of
One (1) year following the Effective Date.
5.6 Termination of Employment of Certain of Seller's Employees. At the Closing,
Buyer shall furnish to Seller a list of Employees that Buyer desires to offer
employment to (the "Offerred Employees"). The Seller agrees to use commercially
reasonable efforts to make available to the Buyer the Offered Employees that
Buyer desires to hire for the purpose of operating the Business. Nothing shall
prohibit Buyer from terminating any of the Offered Employees subsequent to their
employment by Buyer. Seller shall pay all wages, benefits, accrued vacation
taken, sick pay if any other benefits of the Employees are entitled to receive
on or before the Closing. If compliance with applicable federal, state or local
law is required to close this transaction, Buyer and Seller shall cooperate in
complying with such laws in order to close the transaction as soon after such
compliance as reasonably practicable.
5.7 Accounts Receivable. Subject to Seller's Accounts Receivable Rights as set
forth in Sections 2. 1 (l) and 2.3.5,, from and after the Closing Date, Seller
shall forward to Buyer on a weekly basis all payments that it receives on
Accounts Receivables arising from and after the Closing Date together with
providing an accounting therefore. Subject to the immediately preceding
sentence, t Seller agrees to notify and instruct each account debtor to make
payments on the Accounts Receivable to Buyer.
5.8 Confidentiality Agreement. After the Closing and except as otherwise
specifically permitted in this Agreement, Seller agrees, on behalf of itself and
its Affiliates, to use its best efforts not to divulge, communicate, use to the
detriment of Buyer or its Affiliates or for the benefit of any other person or
persons, any confidential information or trade secrets of Seller with respect to
the Assets or the Business, including personnel information, secret processes,
know-how, customer lists, the identity of service providers, formulae, or other
technical data; provided, however, if Seller or any of its Affiliates are
compelled to disclose such information to any tribunal, regulatory or
governmental authority or agency or else stand liable for contempt or suffer
other censure and penalty, Seller or its Affiliates may so disclose such
information without any liability hereunder, upon furnishing Buyer at least ten
(10) days prior written notice, if possible under the circumstances. As used in
this Agreement, "confidential information" and "trade secrets" shall not include
any information that is generally available to the public.
5.9 Assignment of Contracts. On the Closing Date, Seller shall have executed and
delivered to Buyer assignments of all the Contracts that are assignable as may
be determined necessary by either party. With respect to any Contract in which
the consent of a governmental authority or third party is required, Seller
shall, with Buyer's reasonable cooperation, use commercially reasonable efforts
to procure the assignment of all such Contracts to Buyer. Prior to the
successful procurement of any such consent or approval to the assignment of any
Contracts in which same is required, Seller agrees that it shall perform all
commercially reasonably acts and execute any and all documents as may be
requested by Buyer so that Buyer may realize the benefits of such Contracts as
Buyer deems reasonably necessary or desirable, until such time as such Contracts
are successfully assigned to Buyer. To the extent any such Contract cannot be
subcontracted, Buyer agrees to cooperate with Seller and enter into such other
commercially reasonable arrangements as will enable Seller to fulfill its
remaining obligations under said
Contracts. Buyer agrees to indemnify, defend and hold harmless Seller and its
Affiliates from all Damages incurred by Seller or Seller's Affiliates in
connection with Buyer's performance of its obligations under this Section 5.9;
provided, that such Damages are not the result of Seller's default hereunder.
5.10 Change of Seller's Names. Within Sixty (60) days after the Closing, Seller
shall file appropriate documents with the Secretary of State of Virginia to
change its trade names and to transfer its interests in its trade names
described in Schedule 2.1(g) and coordinate with Buyer to allow Buyer to
simultaneously file such corporate documents as may be reasonably necessary for
Buyer to acquire the rights to the trade names.
5.12 Investor Representations. The Seller and ▇▇▇▇▇ ▇▇▇▇ acknowledge that the
Stock and the Kingdom Ventures Shares were acquired by the Buyer in a
transaction directly with Kingdom Ventures, have not been registered under the
Securities Act of 1933 or any state securities laws. Upon the execution hereof
an Investor Representation Agreement in the form attached as Exhibit B (each an
"Investor Representation Agreement") shall be executed by the Seller and ▇▇▇▇▇
▇▇▇▇.
5.13 Non-Compete. The Seller and ▇▇▇▇▇ ▇▇▇▇ agree not to engage in any activity,
or to own any interest in or provide any services to any person whose
activities, directly or indirectly compete with the Business for a period of
[Three] years from the Closing Date. Upon execution hereof a Non-Compete
Agreement in the form attached be signed by the Seller and ▇▇▇▇▇ ▇▇▇▇.
ARTICLE VI
INDEMNIFICATION
6.1 Indemnification.
A. By the Seller. The Seller and ▇▇▇▇▇ ▇▇▇▇, jointly and severally, shall
indemnify, save, defend and hold harmless the Buyer and Buyer's shareholders,
directors, officers, partners, agents and employees (and in the event the Buyer
assigns its right, title and interest hereunder to a corporation, which shall be
permitted hereunder, such assignee's shareholders, directors, officers, agents
and employees) (collectively, the "Buyer Indemnified Parties") from and against
any and all costs, lawsuits, losses, liabilities, deficiencies, claims and
expenses, including interest, penalties, attorneys' fees and all amounts paid in
investigation, defense or settlement of any of the foregoing (collectively
referred to herein as "Damages"), (i) incurred in connection with or arising out
of or resulting from or incident to any breach of material covenant or warranty,
or the inaccuracy of any representation, made by the Seller or ▇▇▇▇▇ ▇▇▇▇ in or
pursuant to this Agreement or any other agreement contemplated hereby or in any
schedule, certificate, exhibit, or other instrument furnished or to be furnished
by the Seller or its Affiliates under this Agreement, or (ii) based upon,
arising out of, or otherwise in respect of any liability or obligation of the
Business or relating to the Assets (a) relating to any period prior to the
Closing Date, other than those Damages based
upon or arising out of the Assumed Liabilities, (b) arising out of facts or
circumstances existing prior to the Closing Date, other than those Damages based
upon or arising out of the Assumed Liabilities or relating to any period on and
after the Closing Date or arising out of facts or circumstances existing on and
after the Closing Date; provided, however, that neither the Seller, nor ▇▇▇▇▇
▇▇▇▇, shall be liable for any such Damages to the extent, if any, such Damages
result from or arise out of a breach or violation of this Agreement by any Buyer
Indemnified Parties, (c) relating to any violation of applicable law respecting
the Real Property including such violations as may have been unknown at the
Closing Date, (d) the matters specifically described in Section 5.9, or (e) the
Retained Liabilities. Notwithstanding anything to the contrary in the Agreement,
including this Paragraph A, in no event shall any indemnification, payment or
obligation of Seller to Buyer, to the Buyer Indemnified Parties, or to any third
party arising from or relating to this Agreement or the documents, instruments
and/or transactions contemplated by this Agreement exceed the amount of the
Purchase Price.
B. By the Buyer. The Buyer shall indemnify, save, defend and hold harmless the
Seller and its shareholders, directors, officers, partners, agents and employees
(collectively, the "Seller Indemnified Parties") from and against any and all
Damages (i) incurred in connection with or arising out of or resulting from or
incident to any breach of any covenant or warranty, or the inaccuracy of any
representation, made by the Buyer in or pursuant to this Agreement or any other
agreement contemplated hereby or in any schedule, certificate, exhibit, or other
instrument furnished or to be furnished by the Buyer under this Agreement, or
(ii) based upon, arising out of or otherwise in respect of any liability or
obligation of the Business or relating to the Assets (a) relating to any period
on and after the Closing Date, or (b) arising out of facts or circumstances
existing on and after the Effective Date relating to the Assumed Liabilities;
provided, however, that the Buyer shall not be liable for any such Damages if
such Damages result from or arise out of a breach or violation of this Agreement
by any Seller Indemnified Parties, (c) the matters specifically described in
Section 5.9, or (d) the Assumed Liabilities. Notwithstanding anything to the
contrary in the Agreement, including this Paragragh B, in no event shall any
indemnification, payment or obligation of Buyer to Seller, to the Seller
Indemnified Parties, or to any third party arising from or relating to this
Agreement or the documents, instruments and/or transactions contemplated by this
Agreement exceed the amount of the Purchase Price.
C. Defense of Claims. If any lawsuit or enforcement action is filed against any
Party entitled to the benefit of indemnity hereunder, written notice thereof
describing such lawsuit or enforcement action in reasonable detail and
indicating the amount (estimated, if necessary) or good faith estimate of the
reasonably foreseeable estimated amount of Damages (which estimate shall in no
way limit the amount of indemnification the indemnified Party is entitled to
receive hereunder), shall be given to the indemnifying Party as promptly as
practicable (and in any event within ten (10) days, after the service of the
citation or summons) ("Notice of Action"); provided that the failure of any
indemnified Party to give timely notice shall not affect its rights to
indemnification hereunder to the extent that the indemnified Party demonstrates
that the amount the indemnified Party is entitled to recover exceeds the actual
damages to the indemnifying Party caused by such failure to so notify within ten
(10) days.
D. Third Party Claims. The provisions of this Section 6.1 are not limited to
matters asserted by the Parties, but cover costs, losses, liabilities, damages,
lawsuits, claims and expenses
incurred in connection with third party claims. The indemnity hereunder is in
addition to any and all rights and remedies of the Parties in connection
herewith.
6.2 Survival of Representations and Warranties. All of the representations,
warranties, covenants and agreements contained in this Agreement shall survive
the Closing of the transaction contemplated herein and the execution and
delivery of the documents, instruments and agreements described in Article V
hereof, notwithstanding any investigation made by or on behalf of the Seller or
the Buyer.
6.3 Limitation on Indemnification. No claim for indemnification shall be
effective unless such claim is made in writing and delivered to the indemnifying
Party hereunder within two (2) years of the Closing Date. Buyer and Seller shall
each take all commercially reasonable actions as may be necessary to mitigate
their Damages and possible indemnified claims, which cost of mitigation shall be
covered by the indemnity set forth herein. Neither Party hereto shall be
permitted to recover punitive, consequential or indirect Damages from the other
party hereto whether by way of indemnification or under any other legal
doctrine, cause of action, or theory of recovery.
ARTICLE VII
CONDITIONS PRECEDENT TO BUYER'S PERFORMANCE
Section 7.1 Conditions. The obligations of Buyer to purchase the Assets under
this Agreement are subject to the satisfaction, at or before the Closing Date,
of all of the conditions set out below in this Article VII. Buyer may waive any
or all of these conditions in whole or in part without prior notice; provided,
however, that no such waiver of a condition shall constitute a waiver by Buyer
of any of its other rights or remedies, at law or in equity, if the Seller or
any Shareholder shall be in default of any of its representations, warranties or
covenants under this Agreement.
Section 7.2 Accuracy of Representations and Warranties. Except as specifically
permitted by this Agreement, all representations and warranties made by the
Seller and ▇▇▇▇▇ ▇▇▇▇ in this Agreement the Investor Representation Agreement or
in any written Schedule or statement delivered to Buyer by the Seller or ▇▇▇▇▇
▇▇▇▇ under this Agreement shall be true on and as of the Closing Date as though
made on and as of that date.
Section 7.3 Performance of the Seller and the Shareholders. The Seller and ▇▇▇▇▇
▇▇▇▇ shall have performed, satisfied and complied with all covenants, agreements
and conditions required by this Agreement the Guaranty Agreement, or the
Non-compete Agreement to be performed or complied with by them on or before the
Closing Date.
Section 7.4 Intentionally Deleted
Section 7.5 Absence of Litigation. No action, suit or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened on or before the Closing Date.
Section 7.6 Consents. All necessary agreements and consents of any parties to
the consummation of the transactions contemplated by this Agreement, or
otherwise pertaining to the matters covered by it, shall have been obtained by
the Seller and delivered to the Buyer.
Section 7.7 Approval of Documents. The form and substance of all certificates,
instruments, opinions and other documents delivered to the Buyer under this
Agreement shall be satisfactory in all respects to the Buyer and its counsel.
Section 7.8 Approval of the Buyer's Board of Directors. The board of directors
of the Buyer shall have authorized and approved the consummation of the
transactions contemplated hereunder.
Section 7.9 Absence of Material Adverse Change. The Buyer shall not have
discovered any materially adverse discrepancy in the financial information
relating to the Seller, the Assets or the Business which heretofore has been or
is hereafter furnished to the Buyer, and no material adverse change shall have
occurred in the Seller's financial condition, Assets, liabilities or prospects
since the Effective Date.
Section 7.10 Delivery of Corporate Documents. There shall be delivered to the
Buyer copies (certified by the Secretary of the Company) of the minutes of the
meetings of the Board of Directors of the Seller, the Board of Directors of Blue
Hill Media of each at which the transactions hereunder were authorized. The
Seller shall have delivered to the Buyer certified copies of the Company's
Articles of Incorporation and Bylaws and a Good Standing Certificate issued by
the Virginia Secretary of State.
Section 7.11 No Casualty. There shall not have occurred any damage, destruction
or loss which has (whether or not covered by insurance) materially and adversely
affected any of the Assets.
ARTICLE VIII
CONDITIONS PRECEDENT TO SELLER'S PERFORMANCE
Section 8.1 Conditions. The obligations of the Seller to sell to the Buyer the
Assets under this Agreement are subject to the satisfaction, at or before the
Closing Date, of all the following conditions of this Article VIII. The Seller
may waive any or all of these conditions in whole or in part without prior
notice; provided, however, that no such waiver of a condition shall constitute a
waiver by the Seller of any of their other rights or remedies, at law or in
equity, the Buyer shall be in default in any of its representations, warranties
or covenants under this Agreement.
Section 8.2 Accuracy of Buyer's Representations and Warranties. Except as
otherwise permitted by this Agreement, all representations and warranties by the
Buyer contained in this Agreement or in any written statement delivered by the
Buyer under this Agreement shall be true
on and as of the Closing Date as though made on and as of that date.
Section 8.3 Accuracy of Performance of Buyer. The Buyer shall have performed,
satisfied and complied with all covenants, agreements and conditions required by
this Agreement to be performed, satisfied or complied with by it on or before
the Closing Date.
Section 8.4 Buyer's Officer's Certificate. The Seller shall have received a
certificate, dated the Closing Date, signed and verified by the Buyer's
President and certifying, in such detail as the Seller and its counsel may
reasonably request, that the conditions specified in Sections 8.2 and 8.3
relating to Purchaser have been fulfilled.
Section 8.5 Authority of Purchaser. The Seller shall have received certified
copies of all resolutions of the Buyer's board of directors pertaining to the
due authorization, execution, delivery and performance by the Buyer of this
Agreement.
Section 8.6 Approval of Documents. The form and substance of all certificates,
instruments and other documents delivered to the Seller under this Agreement
shall be satisfactory in all respects to the Seller and its counsel.
Section 8.7 Consent of Amen Properties. Seller shall receive the consent of Amen
Properties to the assumption of the Note (described in Section 2.4) by Buyer
within a reasonable amount of time after the Closing Date.
ARTICLE IX
TERMINATION PRIOR TO CLOSING
Section 9.1 Termination. This Agreement and the transactions contemplated herein
may be terminated at any time prior to the Closing:
(1) By the mutual written consent of the Buyer and the Seller;
(2) By either the Buyer or the Seller in writing, without liability to the Party
terminating this Agreement on account of such termination, if the Seller or
▇▇▇▇▇ ▇▇▇▇ on the one hand, or the Buyer on the other, as the case may be, shall
(i) fail to perform in any material respect its agreements contained herein
required to be performed prior to the Closing Date, or (ii) materially breach
any of its representations, warranties or covenants contained herein.
Section 9.2 Effect of Obligations. Termination of this Agreement pursuant to
this Article IX shall terminate all obligations of the Parties and this
Agreement shall become void and have no effect without any liability on the part
of any Party or the shareholders, directors or officers of the Seller or the
Buyer in respect thereof, except for the obligations under Sections 5.8, and
10.1; provided, however, that termination pursuant to clause (b) of Section 9.1
shall not relieve the defaulting or breaching party from any liability to the
other party hereto.
ARTICLE X
MISCELLANEOUS
10.1 Fees. Except as expressly set forth herein to the contrary, each Party
shall be responsible for all costs, fees and expenses (including attorney and
accountant fees and expenses) paid or incurred by such Party in connection with
the preparation, negotiation, execution, delivery and performance of this
Agreement, or otherwise in connection with the transaction contemplated hereby.
10.2 Modification of Agreement. This Agreement may be amended or modified only
in writing signed by both of the Parties, and by the individuals joining in the
execution hereof.
10.3 Notices. All notices, consents, demands or other communications required
or permitted to be given pursuant to this Agreement shall be deemed sufficiently
given when delivered personally or telefaxed during regular business hours
during a business day to the appropriate location described below, or three (3)
business days after posting thereof by United States first-class, registered or
certified mail, return receipt requested, with postage and fees prepaid and
addressed as follows:
If to Seller: Blue Hill Media, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
If to Buyer: Kingdom Communications Group, Inc.
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, President
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇. ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, PC
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Any Party at any time by furnishing notice to the other Party in the manner
described above may designate additional or different addresses for subsequent
notices or communications.
10.4 Severability. The invalidity or unenforceability of any provision of this
Agreement shall not invalidate or affect the enforceability of any other
provision of this Agreement.
10.5 Entire Agreement; Binding Effect. This Agreement sets forth the entire
agreement among the Parties with respect to the subject matter hereof. This
Agreement shall be binding upon and shall inure to the benefit of the Parties
and their respective successors and assigns.
10.6 Waiver. No delay in the exercise of any right under this Agreement shall
waive such rights. Any waiver, to be enforceable, must be in writing.
10.7 Governing Law and Choice of Forum. This Agreement has been negotiated and
executed in the State of Nevada. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Nevada, including all
matters of construction, validity, performance and enforcement, but without
giving effect to principles of conflict of laws. The parties hereby consent, in
any dispute, action, litigation, or other proceeding concerning this Agreement
to the jurisdiction of the courts in Reno, Nevada.
10.8 Assignment. The Seller shall not assign this Agreement or any interest
herein without the prior written consent of the Buyer. Any attempted assignment
by the Seller of its rights or obligations without such consent shall be null
and void. The Buyer may assign its rights, duties, and obligations under this
Agreement to an affiliated corporation of the Buyer, in which event such
corporation shall be entitled to enforce all of the Buyer's rights, titles and
interests herein. Reference to any of the Parties in this Agreement shall be
deemed to include the successors and assigns of such Party.
10.9 Headings. Headings in this Agreement are for convenience only and shall not
affect the interpretation of this Agreement.
10.10 Schedules and Exhibits. All Schedules and Exhibits attached to this
Agreement are and shall be hereby incorporated in and made a part of this
Agreement.
10.11 Remedies. If any legal action or other proceeding is brought for the
enforcement of this Agreement, the Non-Competition Agreements, the Guaranty
Agreements, or any document, instrument, or agreement executed in connection
herewith, or because of an alleged dispute, breach, default or misrepresentation
in connection with any of the provisions of this Agreement, the Non-Competition
Agreements, the Guaranty Agreements, or any document, instrument, or agreement
executed in connection herewith, the successful or prevailing Party or Parties
shall be entitled to recover reasonable attorneys' fees and other costs incurred
in that action or proceeding in addition to any other remedies to which it or
they may be entitled at law or equity. Except as limited by the provisions of
Section 6.3 herein, the rights and remedies granted herein are cumulative and
not exclusive of any other right or remedy granted herein or provided by law.
10.12 Rights and Liabilities of Parties. Nothing in this Agreement, whether
express or implied, is intended to confer any rights or remedies under or by
reason of this Agreement on any persons other than the Parties and their
respective successors and assigns, nor is anything in this Agreement intended to
relieve or discharge the obligation or liability of any third persons to any
Party to this Agreement, nor shall any provision give any third person any right
of subrogation or action over against any Party to this Agreement.
10.13 Survival. This Agreement, including but not limited to all covenants,
warranties, representations and indemnities contained herein, shall survive the
Closing and the ▇▇▇▇ of Sale, and all other documents, instruments or agreements
relating to the Assets and the transactions contemplated herein, and shall not
be deemed merged therein.
10.14 Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall have the force and effect of an original, and all of which
shall constitute one and the same agreement.
10.15 Attorneys' Fees. If any litigation is instituted to enforce or interpret
the provisions of this Agreement or the transactions described herein, the
prevailing Party in such action shall be entitled to recover its reasonable
attorneys' fees from the other Party hereto.
10.16 Drafting. The Parties acknowledge that each Party was actively involved in
the negotiation and drafting of this Agreement and that no law or rule of
construction shall be raised or used in which the provisions of this Agreement
shall be construed in favor or against any Party hereto because one is deemed to
be the author thereof.
[SIGNATURE PAGE FOLLOWS]
EXECUTED AND DELIVERED EFFECTIVE in multiple counterparts effective as
of the date first written above.
BUYER:
Kingdom Communications Group, INC.,
a Nevada corporation
By:____________________________
_________________, President
SELLER:
Blue Hill Media, INC.,
a Virginia corporation
By:______________________________
________________, President
▇▇▇▇▇ ▇▇▇▇ an Individual:
By: __________________________
__________________, Individual
Schedules
2.1(a) Tangible Assets
2.1(d) Contracts
2.1(g) Intellectual Property
2.1(i) General Intangibles
3.1 Liens, mortgages, encumbrances
3.8 Litigation
3.11 Employees
3.14 Leased Assets
3.22 Customers
3.23 Insurance Policies
3.26 Trade Payables
3.27 Accounts Receivable
Exhibits
A Guaranty Agreement
B Investor Representation Agreement
C Non-compete Agreement