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Exhibit 2.2
ASSET PURCHASE AND SALE AGREEMENT
THIS
ASSET PURCHASE AND SALE AGREEMENT (this “
Agreement ”) is made and entered into as of
September 10, 2007, by and among Universal Fog, Inc., a
corporation organized and existing under the laws of Delaware
(“ Seller ”), and Universal Fog Systems,
Inc., an Arizona corporation (“ Buyer ”).
Capitalized terms used and not
otherwise defined herein shall have the definitions assigned
thereto in Section 10 below.
R E C I T A L S
WHEREAS,
Buyer desires to acquire certain assets and business
operations owned by Seller, and Seller is willing to sell such
assets and business operations to Buyer, on the terms and
conditions set forth in this Agreement.
A G R E E M E N T
NOW,
THEREFORE, the parties, for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged,
agree as follows:
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1.
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TRANSFERRED LIABILITIES; TRANSFERRED ASSETS; PURCHASE
PRICE.
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1.1.
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Transferred Liabilities and Obligations . The business
operations conducted by Buyer are referred to herein as the “
Business ,” and the principal location at which the
Business is conducted at 1808 South 1st Avenue, Phoenix, Arizona
85003. On the First Phase Closing Date (as hereinafter defined),
following the execution of a certain Share Purchase Agreement
executed by the Parties, and following the execution of this
Agreement, Buyer agrees to assume, and Seller agrees to convey,
transfer and deliver to Buyer, all of the liabilities related to
the Business or used directly in connection with the Business (the
“ Transferred Liabilities ”). The Transferred
Liabilities include, but are not limited to, the items described on
Schedule 2 attached hereto, including the Assumed Contracts,
if any.
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1.2.
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Transferred Assets . Within ninety (90) days of the execution
of this Agreement, and upon the execution of certain Share Exchange
Agreements between the Seller and a third party operating company
(the “Second Phase Closing” and the “Second Phase
Closing Date”), Buyer agrees to acquire, and Seller agrees to
convey, transfer and deliver to Buyer, all of the assets related to
the Business, or used directly in connection with the Business,
including cash, accounts receivable and accounts payable (the
“ Transferred Assets ”). The Transferred Assets
include, but are not limited to, the items described on Schedule
1 attached hereto.
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1.3
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Purchase Price . In consideration for the transfer
of the Transferred Assets, Buyer agrees to assume all liabilities
of the Business, both known and unknown (the “ Purchase
Price ”).
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2.1.
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Closing and Possession .
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2.1.1.
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Closing Dates . Subject to the satisfaction of the conditions
set forth herein, the first phase of the transaction which is the
subject of this Agreement shall be closed on September 10, 2007
(the “First Phase Closing ” and/or “First
Phase Closing Date ”) at such time and place as the
parties shall agree in good faith. Within ninety (90) days
following the First Phase Closing Date, the Second Phase Closing of
the transaction shall be closed at such time and place as the
parties shall agree in good faith.
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2.1.2.
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Possession Dates . Actual possession by Buyer, and transfer of
title and risk of loss of the Transferred Liabilities and
Buyer’s assumption of the Assumed Contracts (if any), shall
be deemed to occur effective as of 12:01 a.m. on the first day
after the First Phase Closing Date, unless otherwise agreed by the
parties in writing (the “First Phase Possession Date
”). The actual possession by Buyer, and transfer of title and
risk of loss of the Transferred Assets shall be deemed to occur
effective as of the Second Phase Closing Date and the execution of
the Share Exchange Agreement between the Seller and a third party
operating company (the “Second Phase Possession
Date.”
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2.2.
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Deliveries by Seller .
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2.2.1.
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At
the First Phase Closing, Seller shall deliver the
following:
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2.2.1.1.
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A
Bill of Sale and Assignment in the form attached hereto as
Exhibit A (the “First Phase Bill of Sale
”), executed by Seller, transferring all of the Transferred
Liabilities of the Company to Buyer.
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2.2.1.2.
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All
documentation required, if any, to permit Buyer to continue to use
and occupy the Business’ location, including a sublease if
necessary, in form and substance acceptable to Buyer, executed by
the landlord of the Business’ location.
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2.2.1.3.
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Such
other documents, including certificates and third-party consents or
releases, as may be required hereunder or as reasonably requested
by Buyer to complete the transactions contemplated in this
Agreement.
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2.2.2.
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At
the Second Phase Closing, Seller shall deliver the
following:
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2.2.2.1.
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A
Bill of Sale and Assignment in the form attached hereto as
Exhibit B (the “Second Phase Bill of Sale
”), executed by Seller, transferring all of the Transferred
Assets of the Company to Buyer.
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2.3.
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Deliveries by Buyer . At the First Phase Closing, Buyer will
deliver the following:
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2.3.1.
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The
Purchase Price.
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2.3.2.
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Such
other documents, including certificates, as may be required
hereunder or as reasonably requested by Buyer to complete the
transactions contemplated in this Agreement.
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3.
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SELLERS’ REPRESENTATIONS AND WARRANTIES. Seller
represents and warrants to Buyer that the following are true,
correct and complete as of the date of this Agreement:
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3.1.
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Authority . Seller has all requisite right, power
and authority to: (i) own its assets and to conduct the business
operations of the Business as now being conducted; (ii) execute and
deliver this Agreement and its related documents and perform its
obligations hereunder and thereunder, and (iii) consummate the
transactions contemplated in this Agreement. There are no
agreements, contracts or commitments to which either of the Seller
or the Company is a party that would prohibit or restrict the
transactions contemplated under this Agreement. No consent,
approval, order, or other authorization of any governmental or
regulatory authority is required with respect to Seller’s
execution and deliver of this Agreement or any related document, or
consummation of the transactions contemplated herein or therein.
When executed and delivered by Seller, this Agreement constitutes
the valid and binding obligation of Seller enforceable in
accordance with its terms.
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3.2.
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Ownership of Transferred Assets; Condition of Tangible Transferred
Assets . At the First Phase Closing, Buyer shall acquire all of
Seller’s right, title and interest in the Transferred
Liabilities. At the Second Phase Closing, Buyer shall acquire all
of Seller’s right, title and interest in the Transferred
Assets. The Transferred Assets are in good condition and repair,
subject to ordinary wear and tear, and are adequate and fit for the
uses for which they are intended or being used.
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3.3.
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Transaction Not a Breach . The execution and delivery of this
Agreement and its related documents, the performance by Seller
hereunder, and the consummation of the transactions described
herein, will not conflict with or violate (i) any law, ordinance,
regulation, order, award, judgment, injunction or decree applicable
to Seller or to the Transferred Assets and Liabilities, or (ii)
conflict with or result in a breach of or constitute a default
under any of the terms, conditions or provisions of the articles of
incorporation, bylaws, or other instruments of formation or
organization of Seller.
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3.4.
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Listings and Other Data . All receivable listings, customer
lists and all other information, reports and data made available or
provided to Buyer by Seller are true, correct and accurate in all
material respects as of the date provided or made available, as of
the date of this Agreement. Seller has no present knowledge of any
intent of any current customer or vendor to modify or terminate any
of its outstanding orders or contracts and Seller has received no
notice to such effect.
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3.5.
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Litigation; Compliance with Laws; Licenses and Permits . There
is no Proceeding pending or, to the knowledge of Seller, threatened
against or involving Seller, the Business, the Transferred Assets
or the Transferred Liabilities, or the propriety of this Agreement
or any of the transactions contemplated hereby, at law or in
equity, or before or by any court, arbitrator or governmental
authority, and the Business are not being operated under or subject
to any order, final non-appealable judgment, decree, license or
injunction of any court, arbitrator or governmental
authority.
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3.6.
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Absence of Adverse Changes . There has been no material adverse
change, or any event, condition or occurrence that is reasonably
likely to result in a material adverse change, to the condition of
the Transferred Liabilities, the Transferred Assets or the business
operations of the Business.
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3.7.
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Contracts . Seller has made available or been willing to
provide to Buyer true and complete copies of all Assumed Contracts,
including without limitation all current customer contracts
relating to the Business. There are no material
agreements relating to the Business, whether verbal or written,
that have not been disclosed to Buyer. All of the Assumed Contracts
are in full force and effect and are valid and enforceable
according to their terms, and there are no material breaches or
defaults thereunder, and no condition exists that would cause,
whether by passage of time or otherwise, a breach or default
thereunder. Seller has not entered into any agreement or
understanding, whether written or oral, that waives any of its
respective rights under any of the Assumed Contracts.
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3.8.
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Environmental Issues . In connection with the Business, Seller
has not transported, stored, maintained, used, manufactured or
released any hazardous material or other environmentally sensitive
material or substance in violation of any applicable legal or
regulatory requirement.
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3.9.
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Solvency . Neither Seller nor the Business have been the
subject of any bankruptcy proceedings (whether voluntary or
involuntary), made an assignment for the benefit of creditors, been
adjudicated bankrupt or insolvent, petitioned for or been assigned
any receiver or trustee relating to the Business or any of the
Transferred Liabilities or Transferred Assets, commenced any
reorganization or restructuring of debt, or otherwise failed to
fulfill its payment obligations in the ordinary
course. None of the above has been commenced or
threatened against Seller or the Business.
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3.10.
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Disclosure . No representation or warranty by Seller and no
document furnished by Seller pursuant to this Agreement or
otherwise in connection herewith contains or will contain any
untrue statement of a material fact or omits or will omit to state
any material fact necessary in order to make the statements
contained therein, in light of the circumstances under which made,
not misleading.
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4.
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BUYER’S REPRESENTATIONS AND WARRANTIES. Buyer
represents and warrants to Seller that the following are true,
correct and complete as of the date of this Agreement:
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4.1.
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Authority . Buyer has all requisite right, power and authority
to: (i) execute and deliver this Agreement and its related
documents and perform his obligations hereunder and thereunder, and
(ii) consummate the transactions contemplated in this Agreement.
There are no agreements, contracts or commitments to which Buyer is
a party that would prohibit or restrict the transactions
contemplated under this Agreement. No consent, approval, order, or
other authorization of any governmental or regulatory authority is
required with respect to Buyer’s execution and deliver of
this Agreement or any related document, or consummation of the
transactions contemplated herein or therein. When executed and
delivered by Buyer, this Agreement constitutes the valid and
binding obligation of Buyer enforceable in accordance with its
terms.
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4.2.
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Transaction Not a Breach . The execution and delivery of this
Agreement and its related documents, the performance by Buyer
hereunder, and the consummation of the transactions described
herein, will not conflict with or violate (i) any law, ordinance,
regulation, order, award, judgment, injunction or decree applicable
to Buyer, or (ii) conflict with or result in a material breach of
any contract, agreement, or other instrument, obligation or
understanding of any nature to which Buyer is a party or by which
Buyer is bound or affected.
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4.3.
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Solvency . Buyer has not been the subject of any bankruptcy
proceedings (whether voluntary or involuntary), made an assignment
for the benefit of creditors, been adjudicated bankrupt or
insolvent, petitioned for or been assigned any receiver or trustee
relating to his assets, commenced any reorganization or
restructuring of debt, or otherwise failed to fulfill his payment
obligations in the ordinary course. None of the above
has been commenced or threatened against Buyer.
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5.
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MANAGEMENT AND CONTROL OF ASSETS.
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5.1.
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Management. During the ninety (90) day interim period between
the First Phase Closing and the Second Phase Closing, Buyer shall
assume all management and control of the assets and operations of
the Business. Buyer shall have supervisory control over the
management of the Business, and may delegate duties according to
its discretion. Additionally Buyer shall perform all management
functions related to and on behalf of the Business, including
without limitation the power to enter into, make, sign, seal,
deliver and perform all agreements, contracts, documents,
instruments and other undertakings and to engage in all activities
and transactions as may be necessary or desirable in order to carry
out the Business. Buyer shall be responsible for maintaining all
financial and accounting records of the Business. Any and all
revenue generated or cost incurred by Business shall be to the
benefit or obligation of Buyer.
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6.1.
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Expenses . Unless expressly stated otherwise herein, each of
Buyer and Seller will bear their own respective costs and expenses
incurred in connection with the preparation and execution of this
Agreement and its related documents, and the consummation of the
transactions contemplated herein, including without limitation all
legal fees and expenses, and fees arising from accountants, tax and
financial advisors.
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6.2.1.
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Each
party agrees that it will (i) not disclose the other party’s
Confidential Information to any third party; and (ii) protect all
Confidential Information of the other party from unauthorized use,
access, or disclosure in the same manner as it protects its own
Confidential Information of a similar nature, and in no event with
less than reasonable care. Upon the disclosing party’s
written request, the receiving party will promptly return
any
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