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ASSET PURCHASE AGREEMENT
This
Asset Purchase Agreement (the "Agreement") is entered into as
of September 28, 2007, by and among ADVANCED VEHICLE SYSTEMS,
LLC, a Florida Limited Liability Company, (hereinafter
referred to as "AVS"), Barbara Wortley, individually, and LAW
ENFORCEMENT ASSOCIATES CORPORATION, a Nevada corporation,
(hereinafter referred to as "LEA");
WHEREAS, Barbara Wortley currently controls
AVS which is a company which manufactures and sells surveillance
vans; and
WHEREAS, AVS
desires to sell, and LEA desires to buy certain assets of AVS;
and
WHEREAS, there is currently pending a
lawsuit in the Circuit Court of Broward County, Florida, Circuit
Court Case No. 05-013630 CAGE 04 (the "Case"), wherein AVS and
Barbara Wortley, amongst other, are Plaintiffs amongst others and
LEA is a Defendant; and
WHEREAS, the parties are desirous of
settling the Case.
NOW
THEREFORE, in consideration of the mutual agreements,
representations and warranties in this Agreement, the parties
agree as follows:
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1.
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ASSETS
PURCHASED. Subject to all other terms and conditions set forth
herein, on the Closing Date, AVS shall sell, convey, transfer and
assign to LEA and LEA shall purchase from AVS those certain limited
assets of AVS, as set forth in Exhibit A attached hereto, which
assets include all of AVS' designs, drawings and intellectual
property rights. It is understood that the assets do not constitute
more than 50% of the assets of AVS. In addition, LEA shall purchase
certain usable inventory on hand of AVS. The term "usable
inventory" shall be defined as those assets which may be
immediately used by. LEA, are in good condition, not damaged and
which are not obsolete.
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2.
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PURCHASE
PRICE. The purchase price for the Assets shall be: (1) 375,000
shares of LEA's restricted common stock which shall be issuable
upon the closing; (2) AVS' cost of the usable inventory purchased;
and (3) and the granting to Barbara Wortley of the put option
described in Section 12 below.
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3.
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ISSUANCE
OF ADDITIONAL SHARES. In addition, LEA shall issue Barbara Wortley
25,000 shares in consideration of Wortley causing the dismissal of
the Suit, with prejudice.
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4.
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AVS'
REPRESENTATIONS AND WARRANTIES. AVS represents and warrants to
LEA
as follows:
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A.
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AVS
holds good and marketable title to the Assets, free and clear of
all restrictions, liens and encumbrances.
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B.
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Neither
Barbara Wortley nor any other person or entity has any interest in
the assets being sold by AVS to LEA.
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C.
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AVS
has not employed any broker or finder in connection with the
transactions contemplated by this Agreement, or taken action that
would give rise to a valid claim against any party for a brokerage
commission, finder's fee, or other like payment.
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D.
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The
execution and delivery of this Agreement by AVS and the
consummation of the contemplated transactions, will not result in
the creation or imposition of any valid lien, charge, or
encumbrance on any of the Assets, and will not require the
authorization, consent, or approval of any third party, including
any governmental subdivision or regulatory agency.
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E.
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AVS
has no knowledge of any claim, litigation, proceeding, or
investigation pending or threatened against AVS or its Assets that
might result in any material adverse change in the business or
condition of the Assets being conveyed under this
Agreement.
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F.
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None
of the representations or warranties of AVS contain or will contain
any untrue statement of a material fact or omit or will omit or
misstate a material fact necessary in order to make statements in
this Agreement not misleading. AVS knows of no fact that has
resulted, or will result in a material change in the business,
operations, or assets of AVS.
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5.
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REPRESENTATIONS
OF LEA. LEA represents and warrants as follows:
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A.
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LEA
is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Nevada. LEA has all
requisite corporate power and authority to enter into this
Agreement and perform its obligations hereunder.
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B.
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The
execution, delivery, and performance of this Agreement has been
duly authorized and approved by the Board of Directors of LEA, and
this Agreement constitutes a valid and binding Agreement of LEA in
accordance with its terms.
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C.
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LEA
has not employed any broker or finder in connection with the
transaction contemplated by this Agreement and has taken no action
that would give rise to a valid claim against any party for a
brokerage commission, finder's fee, or other like
payment.
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D.
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None
of the representations or warranties of LEA contain or will contain
any untrue statement of a material fact or omit or will omit or
misstate a material fact necessary in order to make the statements
contained herein not misleading.
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6.
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COVENANTS
OF AVS. AVS agrees that between the date of this Agreement and
the
Closing Date, AVS will:
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A.
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Continue
to operate its business in the usual and ordinary course and in
substantial conformity with all applicable laws, ordinances,
regulations, rules, or orders, and will use its best efforts to
preserve the continued operation of its business with its
customers, suppliers, and others having business relations with
AVS.
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B.
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Not
assign, sell, lease, or otherwise transfer or dispose of the
Assets, whether now owned or hereafter acquired, except in the
normal and ordinary course of business and in connection with its
normal operation.
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C.
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Maintain
all of the Assets other than inventories in their present
condition, reasonable wear and tear and ordinary usage
excepted.
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D.
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AVS
will use its best efforts to effectuate the transactions
contemplated by this Agreement and to fulfill all the conditions of
the obligations of AVS under this Agreement, and will do all acts
and things as may be required to carry out their respective
obligations under this Agreement and to consummate and complete
this Agreement.
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A.
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LEA
will use its best efforts to effectuate the transactions
conte
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