Exhibit No. 10.1 Asset Purchase Agreement
with I.S. Solutions LLC dated
February 24, 2005
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this
"Agreement") is made on February 24, 2005,
by and among I. S. Solutions, LLC, a New
Mexico limited liability company
("Seller"), and DataLogic New Mexico, Inc.,
a Delaware corporation
("Purchaser"), a wholly owned and newly
formed subsidiary of DataLogic
International, Inc., a Delaware corporation
("DLGI").
WHEREAS, Seller is engaged in the business
of IT services, has contracts with
existing customers (the "Seller's Business
Agreements"), owns certain office
equipment used to conduct the IT services
covered by Seller's Business
Agreements (the "Seller's Equipment"), and
desires to sell to Purchaser,
subject to the terms and conditions of this
Agreement, Seller's Business
Agreements and Seller's Equipment.
WHEREAS, DLGI provides IT services through
its wholly owned subsidiary,
Datalogic Consulting, Inc., a Texas
corporation, desires to expand its
offering of IT services, Purchaser is a
newly formed wholly owned subsidiary
of DLGI, and desires to purchase, subject
to the terms and conditions of this
Agreement, Seller's Business Agreements and
Seller's Equipment.
NOW, THEREFORE, for good and valuable
consideration, the receipt and
sufficiency of which is hereby
acknowledged, including the recitals above and
the mutual covenants, agreements,
representations and warranties contained in
this agreement, the parties agree as
follows:
1. PURCHASE
AND SALE OF AGREEMENTS AND EQUIPMENT.
Purchaser agrees to purchase and Seller
agrees to sell the Seller's Business
Agreements and Seller's Equipment.
Seller intends to convey all of its right,
title and interest in all contracts
and agreements with all existing or
potential customers of the Seller for IT
services and Purchaser shall perform all
duties and responsibilities of all
contracts and agreements as defined in
Schedule 1 attached.
Moreover, Seller
intends to convey all of its right, title
and interest in all office equipment
and tangible personal property of the
Seller. Schedule 1
attached hereto sets
forth a non-exclusive list of the
contracts, agreements, customer list, office
equipment and tangible personal property of
Seller sold, transferred and
conveyed under this Agreement. There are three (3) open purchase
orders from
customers of Seller ("P.O.'s") that have
been partially shipped and invoiced
by Seller. The remaining balance of the P.O's
are forecasted to be shipped
after the Close and upon shipment will be
invoiced by Purchaser to those
customers ("Invoices") as identified on
Schedule 1 attached.
Upon collection
of the Invoices by Purchaser, Purchaser
shall remit to Seller the amount
collected on the Invoices. Seller shall be
responsible for all costs
associated with the fulfillment of the
P.O.'s including the costs of goods and
services provided to fulfill those P.O.'s.
Purchasers sole
obligation to
Seller shall be limited to the actual
collection of the Invoices. In the
event customers cancel the P.O.'s or do not
pay an Invoice, in whole or in
part, Purchaser shall be under no
obligation to remit any proceeds or provide
to Seller any other payments related to the
P.O.'s.
Purchaser is not assuming any liabilities
in connection with this transaction,
Seller's Business Agreements and Seller's
Equipment shall be delivered free
and clear of all liens, claims and
encumbrances of every nature, save and
except for the AFS lease agreement covering
a server and 5 computers.
2. PURCHASE
PRICE.
The Purchase Price for the Seller's
Business Agreements, Seller's Equipment
and the items specified as conditions
precedent to closing in Section 5 shall
be comprised of two elements: (a) the Cash
Payment and (b) the Stock Payment.
"Cash Payment" shall mean the sum of Fifty
Thousand Dollars ($50,000).
"Stock Payment" shall mean that number of
newly issued shares of restricted
common stock of DLGI having an agreed value
of Fifty Thousand Dollars
($50,000) on a date within 10 business days
of the Closing. For
the purpose
of this section "agreed value" will be
determined by the average closing price
of DLGI common stock as reported by the
National Quotation Bureau on a date
within 10 business days of the Closing
times the number of shares issued.
Seller understands that the Stock Payment
shares will contain a Rule 144
legend and that subsequent transfer or sale
of the shares is limited by
applicable securities laws. Seller (i.e. the "Investor")
agrees that this
agreement involves the purchase and sale of
securities.
Accordingly, Investor
represents that (1) the securities which
are being acquired, are being
acquired for the Investor's own account and
for investment and not with a view
to the public resale or distribution
thereof; (2) the Investor will not sell,
transfer or otherwise dispose of the
securities except in compliance with the
Securities Act of 1933, as amended (the
"Act"), and are being transferred in
reliance on exemptions, including but not
limited to Section 4 of the Act; (3)
each Investor acknowledges that each
Investor has been furnished with
disclosure documents that the Investor
feels necessary to make an economic
decision to acquire the securities; (4)
Investor further acknowledges that
Investor has had an opportunity to ask
questions of and receive answers from
duly designated representatives concerning
the terms and conditions pursuant
to which the securities are being purchased
and Investor has been afforded an
opportunity to independently examine such
documents and other information for
the purpose of verifying the financial
condition of DLGI; (5) Investor is
fully aware of the applicable limitations
on the resale of the securities; (6)
by reason of Investor's knowledge and
experience in financial and business
matters in general, and investments in
particular, Investor is capable of
evaluating the merits and bearing the
economic risks of an investment in the
securities and fully understands the
speculative nature of the securities and
the possibility of such loss; and (7) the
present financial condition of
Investor is such that it is under no
present or contemplated future need to
dispose of any portion of the securities to
satisfy an existing or
contemplated undertaking, need or
indebtedness.
The Purchase Price shall be allocated in a
manner consistent with generally
accepted accounting principles applied on a
consistent basis.
Seller and
Purchaser each agree to report the federal,
state and local income and other
tax consequences of the transactions in a
manner consistent with such
allocation.
The Cash Payment shall be earned and
delivered to Seller at Closing.
The Stock Payment shall be earned and
delivered to Seller upon the transfer
and assignment of Seller's Business
Agreements to Purchaser. Seller
understands and agrees that the approval of
third parties, including the State
of New Mexico, is required to complete the
transfer and assignment and/or
cause these parties to enter similar
contracts with Purchaser before the Stock
Payment will be earned and delivered.
CLOSING
A closing (the "Closing") to effect the
purchase and sale shall be held at the
offices of Purchaser or by exchange of
facsimile signature pages on February
24, 2005, or such other date as may be
mutually agreed upon by the parties.
At the Closing, Seller shall execute such
bills of sale and instruments
