EXHIBIT 2.04
PURCHASE AGREEMENT
THIS
PURCHASE AGREEMENT ("
Agreemen t") is made and entered into as of April 21,
2009, by and between: MetroConnect, Inc. (“MTCI”), a
Nevada corporation wholly owned subsidiary, NextPhase Technologies,
Inc a California Corporation (" Buyer "), Freedom
Communications Services, Inc (“FCSI”), a California
corporation (the " Seller ").
RECITALS
A.
Seller desires to transfer and sell, and Buyer desires to acquire,
certain assets from FCSI the Seller on the terms further set forth
herein (referred to herein as the " Acquisition
");
B.
Buyer agrees to change the name of the subsidiary company from
NextPhase Technologies, Inc to Freedom Wireless Services,
Inc.;
C.
This Agreement and the transactions contemplated hereby have been
approved by the Board of Directors of Buyer and the Board of
Directors of the Seller.
The parties to
this Agreement agree as follows:
SECTION 1.
DEFINITIONS
"
Affiliate " means, with respect to any Person, any Person
directly or indirectly controlling, controlled by, or under common
control with such other Person.
" Ancillary
Agreements " means the Assignment and Assumption Agreement and
the Bill of Sale.
" Balance
Sheet " means the unaudited balance sheet of the Business as of
December 31, 2008 found in Schedule 3.05.
" Balance
Sheet Date " means December 31, 2008.
“
Business ” means the business of the Seller which
provides EBTS/CDMA, BTS (Base Transceiver Station), DAS
(Distributed Antenna System) , Micro-Cell and electrical
installation and maintenance solutions to the wireless and
telecommunications industries. Our services include installation
and maintenance for all facets of the wireless infrastructure. We
provide Cellular site interior, exterior, network, wiring and
cabling as well site modifications and upgrades to next Generation
configurations. Our expertise including, Motorola iDEN EBTS,
Ericsson UMTS, GSM, Nokia UMTS, Nortel BTS and Lucent CDMA BTS
Standards Installation. FCSI maintains all required safety
and technical certifications necessary, i.e. Andrew and CommScope
cables and connectors, Anritsu coaxial sweep testing, as well as
Ethernet and fiber optic topologies. to work with you on your
wireless site technologies.
" Business
Intellectual Property " means all Intellectual Property that is
owned or held by or on behalf of Seller for use, or that is being,
and/or has been, used, or is currently under development for use,
in the Business as it has been, is currently or is currently
planned to be conducted.
" Closing
Date " means the date of the Closing.
" Deferred
Revenue " means (i) contracts of the Seller, as of the date of
determination, that are invoiced, but not yet recognized as revenue
and (ii) amounts under contracts for services that, as of the date
of determination, have been billed but not yet recognized as
revenue as a result of an ongoing obligation to perform services
and, in all events, shall be calculated in accordance with the
methodologies set forth on Schedule 1.01(a) hereto. For greater
clarity, Deferred Revenue does not include customer overpayments
that have been retained by the Seller.
"
Intellectual Property " means all tangible or intangible
proprietary information and materials, including without
limitation:
(a) (i) all
inventions (whether patentable or unpatentable and whether or not
reduced to practice), all improvements thereon, and all patents,
patent applications and patent disclosures, together with all
reissuances, continuations, continuations-in-part, divisions,
revisions, extensions and re-examinations thereof, (ii) all
trademarks, services marks, trade dress, logos, trade names, domain
names, and corporate names, together with all translations,
adaptations, derivations and combinations thereof and including all
goodwill associated therewith, and all applications, registrations
and renewals in connection therewith, (iii) all copyrights and all
applications, registrations and renewals in connection therewith,
(iv) all mask works and all applications, registrations and
renewals in connection therewith, (v) all trade secrets and
confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and
production process and techniques, methods, schematics, technology,
technical data, designs, drawings, flowcharts, block diagrams,
specifications, customer and supplier lists, pricing and cost
information and business and marketing plans and proposals), and
(vi) all software and firmware (including data, databases and
related documentation); (b) all documents, records and files
relating to design, end user documentation, manufacturing, quality
control, sales, marketing or customer support for, and tangible
embodiments of, all intellectual property described herein; and(c)
all licenses, agreements and other rights in any third party
product or any third party intellectual property described in (a)
and (b) above other than any "off-the-shelf" third party software
or related intellectual property.
" Lien "
means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, restriction or encumbrance of any kind
in respect of such asset.
" Material
Adverse Change " means a material adverse change in the
business, assets, financial condition, or results of operations of
Seller or the Business alone or as taken as a whole.
" Material
Adverse Effect " means a material adverse effect on the
business, assets, financial condition, or results of operations of
Seller or the Business taken as a whole;
" Permitted
Lien " means (i) mechanic's and other similar statutory liens
that are not material in nature or amount, and (ii) liens for Taxes
or other governmental charges not yet due and payable or due but
not delinquent or that are being contested in good
faith.
" Person
" means an individual, corporation, partnership, association, trust
or other entity or organization, including a government or
political subdivision or an agency or instrumentality
thereof.
" to
Seller's Knowledge ", " Known to Seller " and words of
similar import means the knowledge of Seller's officers or
directors or Parent’s officers or directors.
SECTION 2.
DESCRIPTION OF TRANSACTION
2.1.
ASSETS TO BE TRANSFERRED . Upon the terms and subject to the
conditions of this Agreement, Buyer agrees to purchase from Seller
and Seller agrees to sell, transfer, assign and deliver, or cause
to be sold, transferred, assigned and delivered, to Buyer at
Closing all of Seller's right, title and interest in the following
assets of the Business, as listed below (the " Purchased
Assets "):
(a)
The personal property and interests therein used by Seller or held
by Seller for use in connection with the Business, including
equipment, furniture, office equipment, and communications
equipment, as listed on Schedule 3.07;
(b) Katherine
Thompson agrees to become President of MetroConnect, Inc and
Freedom Wireless Services, Inc upon completion of this agreement,
further the Board of Directors on April 13, 2009 voted to bring
Katherine Thompson on as a board member upon completion of this
closing.
(c) all
rights under all contracts, agreements, licenses, commitments,
sales and purchase orders and other instruments used by Seller or
held by Seller for use in connection with the Business, as listed
on Schedule 3.11 other than contracts and such other documents
indicated thereon as "Excluded Contracts" (the " Excluded
Contracts ") but including any contract or other document which
would be listed on Schedule 3.11 but for any dollar limitation
contained in Section 3.11 (collectively, the " Contracts
");
(d) all
transferable licenses, permits or other governmental authorizations
affecting, or relating in any way to, the Business, including
without limitation the items listed on Schedule 3.3;
2.2.
Assumption of Liabilities. Upon the terms and subject to the
conditions of this Agreement, Buyer agrees, effective at the
Closing, to assume the following liabilities (the "Assumed
Liabilities"):
(a) all
liabilities and obligations of Seller arising under the Contracts
(other than liabilities or obligations attributable to any failure
by Seller to comply with the terms thereof except to the
extent reserved for in the Seller's financial statements and
specifically disclosed to Buyer, (ii) for obligations of Seller
under warranty claims or expenses assumed under Section 2.03(b) or
(iii) as specifically identified on Schedule 2.03(a)) including,
without limitation obligations associated with Deferred
Revenue;
(b) all
liabilities and obligations of Ford Motor Credit
(“FMC”) (3) three 2007 Ford F-150 pick up trucks,
currently financed by Ford Motor Credit. Buyer agrees to pay FMC
all back payments due at the time of closing approximately $4230
and all payments forward. Seller agrees to turn all rights to
ownership on the vehicles listed above. Upon complete payoff to FMC
Seller agrees to release all ownership to Buyer.
2.3.
Excluded Liabilities. Notwithstanding any provision in this
Agreement or any other writing to the contrary, Buyer is assuming
only the Assumed Liabilities and is not assuming any other
liability or obligation of Seller or any Affiliate of Seller (or
any predecessor owner of all or part of its business and assets) of
whatever nature whether presently in existence or arising or
asserted hereafter. All such other liabilities and obligations
shall be retained by and remain obligations and liabilities of
Seller or its Affiliates (all such liabilities and obligations not
being assumed being herein referred to as the "Excluded
Liabilities"). Without limiting the foregoing, none of the
following shall be Assumed Liabilities for the purposes of this
Agreement:
(a) Any
and all liabilities and obligations of Seller for Taxes, (including
any Taxes that arise as a result of the transactions contemplated
by this Agreement);
(b) Any
liabilities or obligations relating to employee benefits or
compensation arrangements existing as of the end of the day on the
day immediately preceding the Closing Date;
(c) any
claims for refunds based on any warranty, express or implied, for
products or services provided to the extent not reserved therefore
on the Balance Sheet or not properly accrued since the Balance
Sheet Date;
(d) any
environmental liabilities;
(e) any
liability or obligation relating to an Excluded Asset;
and
(f) any
liability or obligation relating to or arising under any Excluded
Contract.
2.4.
Assignment of Contracts and Rights. Anything in this
Agreement to the contrary notwithstanding, this Agreement shall not
constitute an agreement to assign any Purchased Asset or any claim
or right or any benefit arising thereunder or resulting therefrom
if an attempted assignment thereof, without consent of a third
party thereto, would constitute a breach or other contravention
thereof or in any way adversely affect the rights of Buyer or
Seller thereunder. Seller and Buyer will use their best efforts
(but without any payment of money by Seller or Buyer) to obtain the
consent of the other parties to any such Purchased Asset or claim
or right or any benefit arising thereunder for the assignment
thereof to Buyer as Buyer may request. If such consent is not
obtained, or if an attempted assignment thereof would be
ineffective or would adversely affect the rights of Seller or Buyer
thereunder so that Buyer would not in fact receive all such rights,
Seller and Buyer will cooperate in a mutually agreeable arrangement
under which Buyer would obtain the benefits and assume the
obligations thereunder in accordance with this Agreement, including
subcontracting, sub-licensing, or subleasing to Buyer, or under
which Seller would enforce for the benefit of Buyer, with Buyer
assuming Seller's obligations, any and all rights of Seller against
a third party thereto. Seller will promptly pay to Buyer when
received all monies received by Seller under any Purchased Asset or
any claim or right or any benefit arising thereunder, except to the
extent the same represents an Excluded Asset. In such event, Seller
and Buyer shall, to the extent the benefits therefrom and
obligations thereunder have not been provided by alternate
arrangements satisfactory to Buyer and Seller, negotiate in good
faith an adjustment in the consideration paid by Buyer for the
Purchased Assets.
2.5. Purchase
Price; Closing.
(a) The
purchase price for the Purchased Assets (the "Purchase Price") is
$500,000 in U.S. dollars.
(b) The
closing (the " Closing ") of the purchase and sale of the
Purchased Assets and the assumption of the Assumed Liabilities
hereunder shall take place at the offices of MetroConnect ,
Inc., Anaheim, California upon execution of this Agreement or at
such other place as Buyer and Seller may agree. At the
Closing,
(i)
Buyer shall prepare and sign a note with a cash payment equal to
$500,000 for a period of 2 years, 7% interest per year. This
note can also be convertible at the Sellers option at $1.00 per
share.
(ii) Each
of Seller and Buyer shall execute and deliver each of the Ancillary
Agreements to be entered into by it at the Closing, in each case
substantially in the form attached as an Exhibit to this Agreement
and Seller shall deliver to Buyer such deeds, bills of sale,
endorsements, consents, assignments and other good and sufficient
instruments of conveyance and assignment (the " Conveyance
Documents ") as the parties and their respective counsel shall
deem reasonably necessary or appropriate to vest in Buyer all
right, title and interest in, to and under the Purchased
Assets..
(iii) Seller
shall have arranged with Buyer for the physical delivery of the
Personal Property and all copies of the Business Intellectual
Property, and the physical embodiment thereof.
(iv) Seller
and Buyer shall execute and deliver all such instruments, documents
and certificates as may be reasonably requested by the other party
that are necessary, appropriate or desirable for the consummation
at the Closing of the transactions contemplated by this
Agreement.
2.6. Allocation
of Purchase Price.
(a) As
soon as practicable after the Closing, Buyer shall deliver to
Seller a statement (the "Allocation Statement"), setting forth the
value of the Purchased Assets and of the covenant not to compete
described in Section 5.04 hereof, which shall be used for the
allocation of the Purchase Price and the Assumed Liabilities among
the Purchased
Assets and the covenant not to compete (the
allocation shall be made in accordance with all applicable
provisions of the Code and any applicable state or local
law).
SECTION 3.
REPRESENTATIONS AND WARRANTIES OF SELLER
Except as set
forth in the disclosure schedules dated as of the date hereof and
delivered herewith to Buyer, (which disclosure schedules identify
the section and subsection to which each disclosure therein
relates), Seller and Parent hereby represents and warrant to Buyer
as of the date hereof that:
3.1.
Corporate Existence and Power. Seller is a corporation duly
incorporated, validly existing and in good standing under the laws
of its jurisdiction of incorporation, and has all corporate powers
and all governmental licenses, authorizations, consents and
approvals required to carry on the Business as now conducted.
Seller is duly qualified to do business as a foreign corporation
and is in good standing in each jurisdiction where the character of
the property owned or leased by it or the nature
of its activities makes such qualification necessary, except for
those jurisdictions where the failure to be so qualified would not,
individually or in the aggregate, have a Material Adverse
Effect.
3.2.
Corporate Authorization. The execution, delivery and
performance by Seller of this Agreement and each of the Ancillary
Agreements, and the consummation by Seller of the transactions
contemplated hereby and thereby are within Seller's corporate
powers and have been duly authorized by all necessary corporate
action on the part of Seller. Each of this Agreement and each
Ancillary Agreement to which Seller is a party has been duly
executed and delivered by Seller and constitutes a valid and
binding agreement of Seller, enforceable in accordance with its
terms.
3.3. Governmental
Authorization; Consents.
(a)
The execution, delivery and performance by Seller of this Agreement
and each of the Ancillary Agreements to which Seller is a party
require no action by or in respect of, or filing with, any
governmental body, agency, or official.
(b)
Except as set forth in Schedule 3.3, no consent, approval, waiver
or other action (a " Required Consent ") by any Person
(other than any governmental body, agency, official or authority
referred to in (a) above) under any contract listed on Schedule
3.11 or any other material contract, agreement, indenture, lease,
instrument, or other document binding upon or to which the Seller
is a party is required or necessary for the execution, delivery and
performance by Seller of this Agreement and each Ancillary
Agreement to which Seller is a party, or for the consummation of
the transactions contemplated hereby or thereby.
3.4.
Non-Contravention. The execution, delivery and performance
by Seller of this Agreement and each Ancillary Agreement to which
Seller is a party, and the consummation of the transactions
contemplated hereby and thereby, do not and will not (i) contravene
or conflict with the corporate charter or bylaws of Seller, (ii)
assuming compliance with the matters referred to in Section 3.3(a),
contravene or conflict with any provision of any law, regulation,
judgment, injunction, order, Permit or decree binding upon or
applicable to Seller or the Business; (iii) assuming the receipt of
all Required Consents, constitute a default (with or without notice
or lapse of time, or both) under or give rise to any right of
termination, cancellation or acceleration of any right or
obligation of Seller, or to a loss of any benefit, relating to the
Business to which Seller is entitled under any provision of any
agreement, contract or other instrument binding upon Seller or (iv)
result in the creation or imposition of any Lien (other than a
Permitted Lien) on any Purchased Asset.
3.5. Personal
Property
(a)
Seller has good and marketable title to, or in the case of leased
personal property has valid leasehold interests in, all personal
property (including machinery and equipment, inventory, and
furniture) (whether tangible or intangible) included in the
Purchased Assets (the "Personal Property"). All of such Personal
Property is listed on Schedule 3.07. None of such Personal Property
is subject to any Liens, other than:
(i)
Liens disclosed;
(ii) Permitted
Liens; or
(iii) Liens
that do not materially detract from the value of the Personal
Property as now used, or materially interfere with any present or
intended use of the Personal Property.
(b) The
Personal Property has no material defects, is in good operating
condition and repair (ordinary wear and tear excepted), and is
generally adequate for the uses to which it is being
put.
3.6.
Intentionally Omitted .
3.7. Compliance
with Laws.
(a)
Seller is not and has not been in violation of any applicable
provisions of any laws, statutes, ordinances or regulations and to
Seller's Knowledge is not under investigation with respect to and
has not been threatened to be charged with or given notice of any
violation of, any law, rule, ordinance or regulation applicable to
the Purchased Assets or the conduct of the Business.
(b) &n
