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EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
between
STRATUS ENTERTAINMENT, INC.
(a Nevada corporation)
and
THE LEAGUE PUBLISHING, INC.,
(a Nevada corporation)
THIS ASSET PURCHASE AGREEMENT (this
"Agreement"), dated August 14, 2007, between THE League
Publishing, Inc. (formally known as Latin Television, Inc. )("
Seller " herein), a Nevada corporation and
Stratus Entertainment, Inc., a Nevada corporation,
(“ Stratus ” or the " Buyer "), is
made with reference to the following provisions, and shall
effective upon closing.
RECITALS
A. The Seller owns
certain assets relating to the production and filming of
television programming, including television cameras and
television camera equipment, editing and processing equipment,
distribution, satellite and antenna equipment, and computer
interface equipment relating to the production of television
programs (the “Studio Assets”). The
Seller also owns certain assets consisting of the
exclusive right to air and distribute television programs not
created or produced by the Seller (the “Television
Rights Assets”). Further, Seller owns and/or
controls certain intellectual property including but not limited
to trademarks, tradenames, logos and copyrights related to Latin
Television. (the “Intellectual Property Assets”,
collectively with the Studio Assets, and the Television Rights
Assets, the “Assets”). The Studio Assets
and the Television Rights Assets are more fully described in
Exhibit A attached hereto (the Studio Assets) and in Exhibit B
attached hereto (the Television Rights Assets).
B.
The Seller , formally Latin Television
Inc., is the surviving company of a merger between New LTV
Acquisition, LLC. and Mega Mania Interactive, Inc. (“Mega
Mania”), a Nevada corporation. Mega Mania, through
the above described merger acquired the Studio Assets, the
Intellectual Property Assets and the Television Rights
Assets.
C.
The Buyer desires to acquire the Assets
and assume all of Seller’s right, title and
interest in and to the Assets.
D.
The Buyer and Seller agree that
upon execution of the document, title to the assets shall
immediately pass to Buyer and Buyer shall have
complete use and control of assets.
AGREEMENT
NOW, THEREFORE , in consideration of the
mutual agreements, warranties and representations contained in
this agreement, the parties hereby agree as follows.
Incorporation of Recitals
The recitals and prefatory phrases and
paragraphs set forth above are hereby incorporated in full and
made part of this agreement.
ASSET PURCHASE AND CONSIDERATION
1. Studio Assets.
Seller agrees to sell and transfer, and Buyer
agrees to purchase the Studio Assets free and clear of all
liens, claims and encumbrances. Seller hereby
sells and transfers to Buyer the Studio Assets free and
clear of all liens, claims and encumbrances by execution of this
Agreement, effective upon Closing. The Studio Assets are
described in Exhibit A, attached.
(a) Studio Assets include any additional assets
not specifically included or described in this agreement which
are now owned or were acquired by the Seller subsequent
to its purchase of the Studio Assets which are part and parcel
to the Studio Assets and are necessary to conduct the business
of LTV .
2. Television Rights Assets.
Seller agrees to sell and transfer, and
Buyer agrees to purchase the Television Rights Assets
free and clear of all liens, claims and encumbrances by
execution of this Agreement, effective upon Closing.
Seller hereby sells and transfers to Buyer the
Television Rights Assets free and clear of all liens, claims and
encumbrances by execution of this Agreement. The
Television Rights Assets are more fully described in Exhibit B,
attached.
(a) Television Rights Assets include any
additional assets not specifically included or described in this
agreement which are now owned or were acquired by the
Seller subsequent to its purchase of the Studio Assets
which are part and parcel to the Studio Assets and are necessary
to conduct the business of LTV .
3. Intellectual Property Rights Assets.
Seller agrees to sell and transfer, and Buyer
agrees to purchase the Intellectual Property Rights Assets
associated with Latin Television free and clear of all liens,
claims and encumbrances by the execution of the Agreement,
effective upon Closing. Seller hereby sells and
transfers to Buyer the Intellectual Property Rights
Assets which includes all Latin Television intellectual property
and associated rights owned, used and/or controlled by
Seller . Said intellectual property includes, but
is not limited to all trade name(s),
“d.b.a’s”, logos, trademarks, graphics,
designs, devices, copyrights, website(s), website content, and
URL(s).
4. Assignment of Rights.
Seller will assign and Buyer will accept and
assume all of Seller’s rights, title and interest
in and to the Studio Assets, the Television Rights Assets,
Intellectual Property Rights Assets and related assets if
any.
5. Purchase Price. The purchase
price for the Assets shall consist of the issuance to
Seller’s of 1,500,000 shares of restricted Common
Stock (the “Shares”) of Stratus based upon
the representations and warranties that the fair market value of
the assets shall be no less than ONE MILLION FIVE HUNDRED AND
TWENTY FIVE THOUSAND DOLLARS ($1,525,000 U.S.).
6. Execution and Closing. The
consummation of the transaction contemplated by this Agreement
(the "Closing") will take place at the offices of Seller
(the "Closing”). Upon the execution of this
Agreement, Seller shall deliver to Buyer the
Studio Assets, the Intellectual Property Assets and the
Television Assets. Buyer shall take possession of
the Assets and have full use and control of those Assets.
After execution of this Agreement,
Buyer and Seller will be allowed to verify
warranties and representations made by the respective parties.
Additionally, Seller will provide at its own expense an
audit of the acquired Assets. Unless agreed to otherwise
by both parties in writing, at the Closing the Seller
shall provide assignments, such bills of sale and instruments of
transfer and conveyance as shall be reasonably be required by
Buyer for the transfer to Buyer of all right,
title and interest of Seller in, to the Assets.
Each party shall also deliver to each other such officer
certificates and other instruments as the other party shall
reasonably request after the closing as may be reasonably
requested.
BULK SALE, ASSET LIABILITY, AND
CREDITORS
7. Asset Liability. Buyer
shall not assume or be responsible for any liabilities or
obligations of Seller including without limitation, any
liabilities which Seller was obligated to satisfy prior
to Closing Date, or for any tax liability of the Seller .
Buyer shall take all Assets transferred by this
Agreement free of any liens, claims, and encumbrances existing
or claimed to exist on the Assets.
8. Bulk Sale. Seller
recognizes the regulation of “Bulk Transfers” by
Article 6 of the Uniform Commercial Code generally, and that the
states of Florida, Texas, and New Jersey have repealed such
“Bulk Transfer” sections from their respective State
versions of the Uniform Commercial Code.
9. Creditors. In order to
eliminate any and all liens, claims, and encumbrances that may
currently existing on the Assets, the Seller shall pay
all debts owed to creditors prior to the execution of this
Agreement, excepting the following creditors which are necessary
for the continuation of the Business, and which will follow this
transfer of Assets to the Buyer , and which the
Buyer agrees to accept the assignment of the following
existing contracts, attached as Exhibit C, and any debt relating
to those agreements:
(a)
AMC1 Master Services Agreement between Latin
Television, Inc. and Globecast North America Incorporated.
(b)
Lease Agreement between Cabot North University
Drive Lease Co, LLC and Latin Television, Inc.
9.1
Assumption of Debt on Notes. In
anticipation of, and in conjunction with, the execution of this
Agreement, certain creditors of LTV which have loaned capital
funds to New LTV Acquisition LLC (which LTV assumed with the
merger with that company) in exchange for Promissory Notes
(Notes) (said Notes are in excess of $1,500,000 with principal
and interest) have released LTV from repayment of, and any
other obligation for, such Notes upon the assumption of, and
transfer to, all obligations for such Notes to Mr. Hans Jonas
Pettersson, individually. The Notes were issued by
Innovative Finance & Equity Exchange (“IFEX”)
and to Mr. Pettersson in exchange for a loan to New LTV
Acquisition, LLC. Mr. Pettersson personally guaranteed the
Notes at the time of their initial issuance, and has now agreed
to assume all debts, obligations and all accumulated interest on
those Notes as evidenced in the attached “Release,
Transfer, and Assumption of Obligation on Notes,” Exhibit
D. IFEX and Mr. Pettersson have forever released LTV from
all past, present or future, known or unknown obligations on the
Notes. LTV has no other outstanding loans or notes.
Should further creditors, not specifically mentioned
herein, come forward and make claim(s) against Seller ,
Mr. Hans Jonas Pettersson, agrees to personally assume that debt
and further Seller and Mr. Pettersson agree to indemnify Buyer
against all claims and creditors of THE League Publishing, Inc.
incurred while operating as Latin Television.
OTHER REPRESENTATIONS OF THE SELLER’S AND
BUYER
10. Other Agreements of the Seller
.
(a) Investigation .
Seller shall allow Buyer and its representatives
and persons or entitles which may provide financing or legal
services for Buyer in connection with the transactions
contemplated hereby, at all reasonable times, full access during
normal business hours to all offices of Seller to inspect
Studio Assets and Television Rights Assets. Seller
further agrees to permit reasonable access to third parties
having business dealings with the Seller regarding the
Assets. Such access shall not unreasonably interfere with
the operation and conduct of the business of the Seller
or the above described third parties.
11. Other Representations of the
Seller. Seller hereby represents and warrants to
Buyer as follows:
(a) Title to the Purchase
Assets. Seller is the lawful owner and has
good and marketable title to all of the Studio Assets and the
Television Rights Assets and hereby grants indemnification unto
Buyer and its successors and assigns against
claims of any third parties.
Seller has authority to sell and transfer the Studio
Assets and the Television Rights Assets, which are free and
clear from any liens or encumbrances. Additionally,
Seller has received all consents regarding the
acquisition from any entities whose consents are necessary,
including but not limited to, any and all governmental
regulatory agencies whose consents are necessary, holders of
notes, company affiliates, and corporate consents.
(b) Seller’s
Liabilities . Seller does not have any
liability or obligation (direct or indirect,
contingent or absolute, known or unknown, mature or unmatured of
any nature whatsoever, whether arising out of contract, tort,
statute or other ("Liabilities"), except: (i) as specifically
disclosed in a Schedule hereto to be provided to the
Seller on or before the Closing Date, which is
incorporated herein by reference; (ii) liabilities incurred in
the ordinary course of business which will not
individually or in the aggregate be materially adverse to,
or result in a material increase in the current or long term
liabilities or obligations of Seller . To the best
knowledge of the Seller , upon due inquiry, there is no
basis for assertion against Seller of any liabilities
accept for liabilities to be listed in a Schedule hereto to be
provided to the Buyer at the closing.
(d) Compliance with Laws.
Seller has complied with and is not in default under
any applicable law, ordinance regulation or
order, the violation of which would materially and adversely
affect the Assets. There is no litigation proceeding or
investigation pending or known to be threatened which might
materially and adversely effect the Studio Assets or the
Television Assets.
(e) Taxes .
Seller has duly filed all federal, state, local, and
foreign tax returns, if any, necessary to be filed by it and has
duly paid all taxes (including any interest or penalties) which
are or will be due or payable with respect to taxes. There
are no known or proposed penalty, interest or deficiency
assessments with respect to taxes that require payment by,
relate to or could adversely affect the Purchased Assets.
(f) Real Estate and Leases.
There is disclosed in Exhibit C a description of all real
estate, if any, (including buildings and improvements) own
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