<PAGE>
Exhibit 10.1
ASSET PURCHASE AGREEMENT
between
IBUYLINE, INC.
and
PHOENIX RESOURCES TECHNOLOGIES, INC.
Dated as of October 31, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
ARTICLE I
ACQUISITION OF IBL ASSETS AND LIABILITIES AND ISSUANCE OF PRTI SECURITIES.. 1
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF IBL...................................... 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PRTI..................................... 8
ARTICLE IV
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES............................... 11
ARTICLE V
COVENANTS OF PRTI.......................................................... 15
ARTICLE VI
COVENANTS OF IBL........................................................... 17
ARTICLE VII
TERMINATION................................................................ 20
ARTICLE VIII
MISCELLANEOUS.............................................................. 22
ARTICLE IX
DEFINITIONS................................................................ 24
EXHIBIT A -- ACQUIRED ASSETS................................................ 28
</TABLE>
1
<PAGE>
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is entered into as of
---------
October 31, 2000, by and between IBUYLINE, INC., a California corporation
("IBL"), and PHOENIX RESOURCES TECHNOLOGIES, INC., a Nevada corporation
---
("PRTI").
----
WITNESSETH
WHEREAS, PRTI desires to acquire certain of the assets of IBL, and IBL
desires to sell and assign such assets to PRTI in exchange for Common Stock of
PRTI, all on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the respective representations,
warranties, covenants and agreements set forth herein, the parties hereto,
intending to be legally bound hereby, agree as follows:
ARTICLE I
ACQUISITION OF IBL ASSETS AND LIABILITIES AND
ISSUANCE OF PRTI SECURITIES
1.1 Definitions. Certain capitalized terms used in the agreement are
defined in Article IX hereof; reference to a "Schedule" or "Exhibit" is, unless
-------- -------
otherwise specified, to a Schedule or Exhibit to this Agreement.
1.2 Purchase and Sale of Assets.
(a) At the Closing (as that term is defined in Section 1.5), upon the
terms and conditions herein set forth, PRTI shall purchase from
IBL, and IBL shall sell, transfer, convey and deliver to PRTI, in
exchange for the Acquired Shares as specified in Section 1.4, all
of those tangible and intangible assets of IBL which are
specifically identified in Exhibit A to this Agreement (the
"Acquired Assets") and the assumption by PRTI of the Assumed
Liabilities as specified in Section 1.3.
(b) This Agreement shall not constitute an agreement to assign or
transfer any government approvals, instrument, contract, lease,
permit or other agreement or arrangement, or any claim, right or
benefit arising thereunder or resulting therefrom, if an
assignment or transfer or an attempt to make such an assignment
or transfer without the consent of a third party would constitute
a breach or violation thereof or affect adversely the rights of
PRTI or IBL, and any transfer or assignment or any interest under
any such instrument, contract, lease, permit or other agreement
or arrangement that requires the consent of a third party shall
be made subject to such consent or approval being obtained. In
the
1
<PAGE>
event any such consent or approval is not obtained on or prior to
the Closing Date, IBL shall continue to use all reasonable
efforts to obtain such approval or consent after the Closing Date
until such time as such consent or approval has been obtained,
and IBL will cooperate with PRTI in any lawful and economically
reasonable arrangement to provide that PRTI shall receive the
benefits under any such instrument, Contract, lease, permit or
other agreement or arrangement, including performance by IBL as
agent, if economically feasible, provided that PRTI shall
undertake to pay or satisfy the corresponding liabilities for the
enjoyment of such benefit to the extent PRTI would have been
responsible therefor if such consent or approval had been
obtained.
1.3 Assumption of Liabilities. PRTI will assume, and undertake to perform
and pay, all of the debts, liabilities and obligations of IBL listed in Exhibit
B hereto. However, PRTI will not assume, or undertake to perform or pay, any
other debt, liability or obligation of IBL of any kind whatsoever. The debts,
liabilities and obligations of IBL to be assumed by PRTI pursuant to this
Agreement are hereinafter called the "Assumed Liabilities".
1.4 Issuance and Purchase of the Acquired Shares. Subject to the terms
and conditions set forth herein, at the Closing, PRTI shall issue and sell to
IBL, and IBL shall purchase from PRTI in exchange for the Acquired Assets, six
hundred twenty five thousand (625,000) fully paid and nonassessable shares of
PRTI's restricted Common Stock (the "Acquired Shares") which shares are
---------------
restricted as described in Section 2.22 below. The Acquired Shares shall be
paid to IBL as follows: four hundred ninety five thousand (495,000) shares
shall be delivered to IBL at Closing and one hundred thirty thousand (130,000)
shares shall be placed in an escrow account for disposition in accordance with
the terms and conditions of that certain Escrow Agreement, of even date
herewith, between IBL, PRTI, and the Escrow Agent (the "Escrow Agreement") and
the indemnification provisions of Section 6.5 hereof.
1.5 Closing. The closing shall take place in person or by telecopier at
the offices of Duane, Morris & Heckscher LLP, 227 West Monroe Street, Suite
3400, Chicago, Illinois 60606, at 10:00 a.m. Chicago time, at a date and time as
will be agreed upon between IBL and PRTI (such closing being called the
"Closing" and such date and time being called the "Closing Date"). At the
------- ------------
Closing, (a) IBL shall deliver or cause to be delivered to PRTI such instruments
of sale, transfer, conveyance and assignment as PRTI may reasonably request to
evidence and confirm IBL's sale and transfer of the Acquired Assets and Assumed
Liabilities to PRTI; and (b) PRTI shall issue and deliver to IBL stock
certificates in definitive form, registered in the name of IBL, representing the
Acquired Shares being purchased by IBL as payment in full for the Acquired
Assets and Assumed Liabilities being purchased by PRTI under this Agreement.
2
<PAGE>
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF IBL
Subject in every respect to exceptions which are disclosed on the IBL
Schedules, IBL represents and warrants to PRTI that the statements contained in
this Article II are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Article II), except as set forth in the disclosure Schedules
described herein.
2.1 Organization, Standing and Qualification. IBL is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all requisite corporate power and
authority to own or lease and operate its properties, to carry on its business
as currently conducted and as now proposed to be conducted, and to carry out the
transactions contemplated hereby. IBL is duly qualified to do business as a
foreign corporation and is in good standing under the laws of the State of
California, and California is the only State in which the ownership or use of
the Acquired Assets require such qualification (except for the jurisdictions in
which failure to so qualify would not have a Material Adverse Effect upon the
Acquired Assets).
2.2 Investment Company Status. IBL is not an "investment company" within
the meaning of the Investment Company Act of 1940.
2.3 Power and Authority. IBL has the power and authority to execute and
deliver this Agreement, and upon satisfaction of all relevant conditions
specified in Article IV will have power and authority to execute and deliver all
instruments and documents required to be executed and delivered in connection
with this Agreement (collectively the "Transaction Documents") and to perform
---------------------
its obligations under the Transaction Documents.
2.4 Noncontravention. Neither the execution and the delivery of the
Transaction Documents nor the consummation of the transactions contemplated
thereby (including the assignments referred to in Article I above) in accordance
with the terms hereof will (i) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which IBL is subject, (ii)
violate any provision of the articles of incorporation or bylaws of IBL or (iii)
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which IBL is a party or by which it is bound
or to which any of its assets is subject (or result in the imposition of any
security interest upon any of its assets), except where the violation, conflict,
breach, default, acceleration, termination, modification, cancellation, failure
to give notice, or security interest has been
3
<PAGE>
waived in writing or otherwise would not, individually or in the aggregate, (x)
adversely affect the legality, validity or enforceability of any of the
Transaction Documents or the transactions contemplated thereby, (y) have or
result in a material adverse effect on the Acquired Assets or (z) adversely
impair IBL's ability to perform fully on a timely basis its obligations under
any Transaction Document (any of (x), (y) or (z) a Material Adverse Effect).
Assuming satisfaction of all relevant conditions in Article IV, IBL does not
need to give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order for the
Parties to consummate the transactions contemplated by this Agreement (including
the assignments referred to in Article II above), except where the failure to
give notice, to file, or to obtain any authorization, consent, or approval would
not have a Material Adverse Effect.
2.5 Validity. This Agreement constitutes the legal, valid and binding
obligation of IBL, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, moratorium or other similar laws relating to
creditor's rights and general principles of equity and no representation is made
regarding the effect of laws relating to competition or antitrust.
2.6 No Defaults. Except as set forth in Schedule 2.6, IBL is not in
default: (a) under (i) its Organizational Documents, or (ii) any material
written, oral or implied contract to which IBL is a party and, to the best
Knowledge of IBL, the other party to such contract is not in default thereunder;
or (b) with respect to any order, writ, injunction or decree of any court or any
Government Entity which, in the aggregate, will, or could reasonably be expected
to, have a Material Adverse Effect on IBL's business, financial condition,
results of operations, prospects or Acquired Assets.
2.7 Litigation. Except as set forth in Schedule 2.7, there is no: (a)
litigation, action, suit, claim, proceeding or investigation pending or, to the
best of IBL's Knowledge, threatened against or affecting IBL, or any of its
properties or assets, at law or in equity, or before or by any Government
Entity; or (b) governmental inquiry pending or, to the best of IBL's Knowledge,
threatened against or affecting an IBL, including without limitation any inquiry
as to the qualification of IBL to hold or receive any license or permit, and, to
the best of IBL's Knowledge, there is no basis for any of the foregoing. IBL
has not received any opinion or memorandum or legal advice from legal counsel to
the effect that it is exposed, from a legal standpoint, to any liability that
may be material to its business, prospects, financial condition, operations,
property or affairs, or which might call into question the validity of this
Agreement or any of the securities to be issued hereunder or any action taken or
to be taken pursuant hereto or thereto. Furthermore, Schedule 2.7 sets forth
each instance in which IBL is (a) subject to any outstanding injunction,
judgment, order, decree, ruling, or charge or (b) a party to any action, suit,
proceeding, hearing, or investigation of, in, or before any court or quasi-
judicial or administrative agency of any federal, state, local, or foreign
jurisdiction, except where the injunction, judgment, order, decree, ruling,
action, suit, proceeding, hearing, or investigation would not have a Material
Adverse Effect on the Acquired Assets. Except as set forth in Schedule 2.7,
there is no action or suit by IBL pending or threatened against others.
4
<PAGE>
2.8 Title to Properties; Encumbrances.
(a) Except as described in Schedule 2.8, IBL owns and has good and
marketable title to, has a valid leasehold interest in, or holds
a valid license for, the use and transfer of all of the Acquired
Assets, and all of the Acquired Assets are free and clear of
mortgages, pledges, security interests, liens, charges, claims,
restrictions and other encumbrances, except for liens for current
taxes not yet due and payable and minor imperfections of title,
if any, not material in nature or amount and not materially
detracting from the value or impairing the use of the Acquired
Assets subject thereto.
(b) Except as described in Schedule 2.8, all of the Acquired Assets
are in a good state of maintenance and repair. IBL is current
with all lease and rental payments regarding the Acquired Assets.
IBL enjoys peaceful and undisturbed possession under all leases
which are included in the Acquired Assets, and all such leases
are valid and subsisting in full force and effect without any
default of IBL thereunder and, to the best of IBL's Knowledge,
without any default thereunder of any other party thereto. To the
Knowledge of IBL, no event has occurred and is continuing which,
with due notice or lapse of time or both, would constitute a
default or event of default by IBL under any such lease or
agreement or by any other party thereto. IBL's possession of such
property has not been disturbed and no claim has been asserted
against IBL that is adverse to its rights in such leasehold
interests.
2.9 Environmental Matters. IBL has no Knowledge of any claim, has not
received any notice of any claim, and to IBL's Knowledge no proceeding has been
instituted raising any claim, against IBL or any of the Acquired Assets,
alleging any damage to the environment or violation of any Environmental Laws.
IBL has no Knowledge of any facts that would give rise to any claim, public or
private, of violation of Environmental Laws or damage to the environment
emanating from, occurring on or affecting the Acquired Assets or their use, and
IBL has not (a) stored any Hazardous Materials on any real properties which are
part of the Acquired Assets or (b) disposed of any Hazardous Materials in a
manner contrary to any Environmental Laws.
2.10 Governmental Approvals. Except as provided in Schedule 2.10, no
registration or filing with, or consent or approval of or other action by, any
Government Entity is or will be necessary for the valid execution, delivery and
performance by IBL of this Agreement.
2.11 Brokers. Except for the fee to be paid to ITG, no broker, investment
banker, finder, financial advisor or other Person is entitled to any broker's,
finder's, financial advisor's or
5
<PAGE>
other similar fee or commission in connection with the transactions contemplated
by this Agreement based on arrangements made by or on behalf of IBL.
2.12 Officers. To the Knowledge of IBL, no officer, employee or consultant
of IBL is now in violation of any term of any employment contract, patent
disclosure agreement, proprietary information agreement, noncompetition
agreement, nonsolicitation agreement, confidentiality agreement or any other
similar contract or agreement related to the Acquired Assets, or any restrictive
covenant relating to the right of any such officer, employee or consultant to be
employed or engaged by IBL because of the nature of the business conducted or to
be conducted by IBL or relating to the use of trade secrets or proprietary
information of others.
2.13 Employees; Benefit Plans. IBL is not a party to any collective
bargaining agreement and is not a party to any pending or threatened labor
dispute. There is no employee of IBL whose employment is not terminable at will.
IBL has no employee benefit plans.
2.14 Year 2000. IBL's computer system and software including all software
and applications which are part of the Acquired Assets, are able to accurately
process date data, including but not limited to, calculating, comparing and
sequencing from, into and between the twentieth century through year 1999, the
year 2000 and the twenty-first century, including leap year calculations. To the
Knowledge of IBL, it is not aware of any inability on the part of any service
provider to IBL to timely remedy such service provider's own deficiencies in
respect of the year 2000 problem.
2.15 Tax Matters. Except as described in Schedule 2.15, there are no
encumbrances or tax liens on any of the Acquired Assets.
2.16 Real Property. Prior to Closing, IBL will make available to PRTI
correct and complete copies of the leases and subleases (as amended to date)
which are part of the Acquired Assets. With respect to each such lease and
sublease, and except as otherwise disclosed in Schedule 2.16:
(i) the lease or sublease is legal, valid, binding, enforceable,
and in full force and effect;
(ii) the lease or sublease will continue to be legal, valid,
binding, enforceable, and in full force and effect on
identical terms following the consummation of the transactions
contemplated hereby;
(iii) to the best of IBL's Knowledge no party to the lease or
sublease is in breach or default, and no event has occurred
which, with notice or lapse of time, would constitute a breach
or default or permit termination, modification, or
acceleration thereunder;
6
<PAGE>
(iv) to the best of IBL's Knowledge no party to the lease or
sublease has repudiated any provision thereof;
(v) to the best of IBL's Knowledge there are no disputes, oral
agreements, or forbearance programs in effect as to the lease
or sublease;
(vi) to the best of IBL's Knowledge with respect to each sublease,
the representations and warranties set forth in subsections
(i) through (v) above are true and correct with respect to
the underlying lease;
(vii) IBL has not assigned, transferred, conveyed, mortgaged,
deeded in trust, or encumbered any interest in the leasehold
or subleasehold, except for term financing existing as of the
date of this Agreement;
(viii) to the best of IBL's Knowledge all facilities leased or
subleased thereunder have received all approvals of
governmental authorities (including licenses and permits)
required in connection with the operation thereof and have
been operated and maintained in accordance with applicable
laws, rules, and regulations; and
(ix) all facilities leased or subleased thereunder are supplied
with utilities and other services necessary for the operation
of said facilities.
2.17 Intellectual Property. Schedule 2.17 identifies (a) all trademarks,
patents, copyrights, each patent or registration which has been issued to IBL
with respect to any of the intellectual property which is included in the
Acquired Assets and any other intellectual property owned by IBL, (b) each
pending patent application or application for registration which IBL has made
with respect to any intellectual property included in the Acquired Assets, and
(c) each license, agreement, or other permission which IBL has granted to any
third party with respect to any of such intellectual property.
2.18 Contracts. Schedule 2.18 lists all written contracts and other
written agreements to which IBL is a party the performance of which will involve
consideration in excess of $10,000. Prior to Closing, IBL will make available to
PRTI a correct and complete copy of each such contract or other agreement so
listed (as amended to date).
2.19 Powers of Attorney. There are no outstanding powers of attorney
executed on behalf of IBL.
2.20 Investor Status. IBL is an "accredited investor" within the meaning
of Rule 501 under the Securities Act.
7
<PAGE>
2.21 Sophistication. IBL has sufficient knowledge and experience in
investing in companies similar to PRTI in terms of PRTI's stage of development
so as to be able to evaluate the risks and merits of its investment in PRTI and
it is able financially to bear the risks thereof, and it has been afforded the
opportunity during the course of negotiating the transactions contemplated by
this Agreement to ask questions of, and to secure such information from, the IBL
and its officers and directors as it deems necessary to evaluate the merits of
entering into such transactions. All such questions have been answered
satisfactorily and IBL or its counsel have received and reviewed the due
diligence materials delivered to it/them by PRTI.
2.22 Restrictions on Resale of Acquired Shares. IBL understands that the
Acquired Shares have not been registered under the Securities Act and are
restricted shares. IBL understands that no shares can be sold unless they are
first registered under the Securities Act or unless an exemption from such
registration is available.
2.23 Investment Intent. IBL is acquiring the Acquired Shares for its own
account for investment only, and not as a nominee and not with a view towards
distribution of any part thereof, and that IBL has no present intention of
selling, granting any participation in, or otherwise distributing the same.
2.24 Exemption from Registration. IBL understands that the Acquired Shares
have not been registered under the Securities Act. IBL also understands that the
Acquired Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon IBL's
representations contained in the Agreement.
2.25 Title to Acquired Assets. IBL has good title to, or a valid leasehold
interest in, the Acquired Assets. Immediately following the Closing, PRTI will
have good, valid and indefeasible title to, or a valid leasehold interest in,
the Acquired Assets, free and clear of the IBL Liens.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PRTI
Subject in every respect to exceptions which may hereafter be disclosed on
the PRTI Schedules, PRTI represents and warrants to IBL that the statements
contained in this Article III are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the date of this
Agreement throughout this Article III), except as set forth in the disclosure
Schedules described herein.
3.1 Organization of PRTI. PRTI is a corporation duly organized, validly
existing, and in good standing under the laws of Nevada.
8
<PAGE>
3.2 Authorization of Transaction. PRTI has the power and authority to
execute and deliver this Agreement and, upon satisfaction of all relevant
conditions in Article IV will have power and authority to execute and deliver
the Transaction Documents. The issuance, sale and delivery of the Acquired
Shares in accordance with the terms of this Agreement have been duly authorized
by all requisite corporate action of PRTI. When issued, sold and delivered in
accordance with this Agreement, the Acquired Shares issued hereunder will be
validly issued and outstanding, fully paid for, and nonassessable, and will not
be subject to preemptive or any other similar rights held by the shareholders of
PRTI or others; provided, however, that the Acquired Shares may be subject to
restrictions on transfer under applicable state and/or federal securities laws.
3.3 Validity. This Agreement constitutes the legal, valid and binding
obligation of PRTI, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, moratorium or other similar laws relating to
creditor's rights and general principles of equity and no representation is made
regarding the effect of laws relating to competition or antitrust.
3.4 Noncontravention. Neither the execution and the delivery of the
Transaction Documents nor the consummation of the transactions contemplated
thereby (including the assignments referred to in Article I above), will (i)
violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which PRTI is subject, (ii) violate any
provision of the articles of incorporation or bylaws of PRTI or (iii) conflict
with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which PRTI is a party or by which it is
bound or to which any of its assets is subject (or result in the imposition of
any security interest upon any of its assets), except where the violation,
conflict, breach, default, acceleration, termination, modification,
cancellation, failure to give notice, or security interest has been waived in
writing or otherwise would not, individually or in the aggregate, (x) adversely
affect the legality, validity or enforceability of any of the Transaction
Documents or the transactions contemplated thereby, (y) have or result in a
material adverse effect on the Acquired Assets or (z) adversely impair PRTI's
ability to perform fully on a timely basis its obligations under any Transaction
Document (any of (x), (y) or (z) a Material Adverse Effect). Assuming
satisfaction of all relevant conditions in Article IV, PRTI does not need to
give any notice to, make any filing with, or obtain any authorization, consent,
or approval of any government or governmental agency in order for the Parties to
consummate the transactions contemplated by this Agreement (including the
assignments referred to in Article II above), except where the failure to give
notice, to file, or to obtain any authorization, consent, or approval would not
have a Material Adverse Effect.
3.5 Brokers' Fees. Except for the fee to be paid to ITG, no broker,
investment banker, finder, financial advisor or other Person is entitled to any
broker's, finder's, financial advisor's or other similar fee or commission in
connection with the transactions contemplated by this Agreement based on
arrangements made by or on behalf of PRTI.
9
<PAGE>
3.6 Anti-Takeover Statute. PRTI's Board of Directors has taken all
necessary action so that no Nevada "control share acquisition" or other similar
anti-takeover statute (including, but not limited to, Sections 78.378 - 78.3793
and Sections 78.411 - 78.444 inclusive of the Nevada Revised Statutes) or
regulation or applicable provision in PRTI's Articles of Incorporation or Bylaws
prohibits the transactions contemplated by this Agreement. To the Knowledge of
PRTI, no other state takeover statute or regulation is applicable to the
transactions contemplated by this Agreement.
3.7 Material Liabilities; Material Adverse Events.
(a) PRTI does not have any material liability (whether known or
unknown, asserted or unasserted, absolute or contingent, accrued
or unaccrued, liquidated or unliquidated, and/or due or to become
due, including any liability for taxes), except for (i)
liabilities set forth on the face of the financial statements
contained in PRTI's Quarterly Report on Form 10-QSB for the
quarter ended July 31, 2000 and (ii) liabilities which have
arisen after July 31, 2000 in the Ordinary Course of Business.
(b) Since September 30, 2000, there has not been any material adverse
change in the financial condition of PRTI taken as a whole.
Without limiting the generality of the foregoing, since that date
PRTI has not engaged in any practice, taken any action, or
entered into any transaction outside the Ordinary Course of
Business.
3.8 Legal Compliance. PRTI has complied with all applicable laws
(including rules, regulations, codes, plans, injunctions, judgments, orders,
decrees, rulings, and charges thereunder) of federal, state, local, and foreign
governments (and all agencies thereof), except where the failure to comply,
individually or in the aggregate would not have a Material Adverse Effect.
3.9 Disclaimer of other Representations and Warranties. PRTI acknowledges
and agrees that, except as expressly set forth in Article II, above, (a) IBL has
made and makes no representation or warranty, express or implied, at law or in
equity, in respect of any of its assets (including, without limitation, the
Acquired Assets), liabilities or operations, including, without limitation, with
respect to merchantability or fitness for any particular purpose, and any such
other representations or warranties are hereby expressly disclaimed, and (b)
PRTI is purchasing the Acquired Assets on an "as-is, where-is" basis. Without
limiting the generality of the foregoing, PRTI further acknowledges and agrees
that IBL has made and makes no representation or warranty regarding any assets
other than the Acquired Assets, and none shall be implied or inferred at law or
in equity.
10
<PAGE>
3.10 Consent of Third Party Creditors. PRTI recognizes and agrees that (a)
pursuant to Sections 1.2(b), above, and 4.1(l), below, the receipt of certain
waivers and consents from existing creditors of IBL, which creditors hold
security interests in the Acquired Assets, is a condition precedent to the
consummation of this Agreement.
ARTICLE IV
CONDITIONS TO THE OBLIGATIONS
OF THE PARTIES
4.1 Conditions to the Obligations of IBL. The obligation of IBL to
purchase and pay for the Acquired Shares and sell and transfer the Acquired
Assets and assign the Assumed Liabilities on the Closing Date is, at its option,
subject to the satisfaction or waiver by IBL, on or before the Closing Date, of
the following conditions:
(a) Representations and Warranties of PRTI to be True and Correct.
The representations and warranties contained in Article III shall
be true, complete and correct on and as of the Closing Date with
the same effect as though such representations and warranties had
been made on and as of such date, and the President and Treasurer
of PRTI shall have certified to IBL in writing to such effect.
(b) Performance. PRTI shall have performed and complied with all
agreements contained herein required to be performed or complied
with by it prior to or at the Closing Date, and the President and
Treasurer of PRTI shall have certified to IBL in writing to such
effect and to the further effect that all of the conditions set
forth in this Section 4.1 have been satisfied.
(c) Due Diligence. IBL shall have completed its due diligence
investigation of PRTI and shall be satisfied in its sole
discretion in all respects with the findings thereof.
(d) Proceedings to be Satisfactory. All corporate and other
proceedings to be taken by PRTI in connection with the
transactions contemplated hereby and all documents incident
thereto shall be reasonably satisfactory in form and substance to
IBL and its counsel, and IBL and its counsel shall have received
all such counterpart originals or certified or other copies of
such documents as they reasonably may request.
(e) Purchase by IBL. Subject to the conveyance of the Acquired Assets
to PRTI for the Acquired Shares on the Closing Date, PRTI shall
have
11
<PAGE>
delivered a stock certificate or certificates representing the
Acquired Shares.
(f) Supporting Documents. IBL and its counsel shall have received
copies of the following documents:
(i) a certificate of the Secretary of State of Nevada dated as
of a recent date as to the due incorporation and good
standing of PRTI.
(ii) a certificate of the Secretary or an Assistant Secretary
of PRTI dated the Closing Date and certifying: (A) that
attached thereto is a true and complete copy of the Bylaws
of PRTI as in effect on the date of such certification;
(B) that attached thereto is a true and complete copy of
all resolutions adopted by the Board of Directors or the
shareholders of PRTI authorizing the execution, delivery
and performance of this Agreement, the issuance, sale and
delivery of the Acquired Shares and that all such
resolutions are in full force and effect and are all the
resolutions adopted in connection with the transactions
contemplated by this Agreement; (C) that PRTI's Articles
of Incorporation have not been amended since the date of
the last amendment referred to in the certificate
delivered pursuant to clause (i)(A) above; and (D) to the
incumbency and specimen signature of each officer of PRTI
executing this Agreement, and any of the stock
certificates representing the Acquired Shares and any
certificate or instrument furnished pursuant hereto and a
certification by another officer of PRTI as to the
incumbency and signature of the officer signing the
certificate referred to in this clause (ii); and
(iii) such additional supporting documents and other information
with respect to the operations and affairs of PRTI as IBL
or its counsel reasonably may request.
(g) Preemptive Rights; Termination of Shareholder Agreements. All
shareholders of PRTI having any preemptive, first refusal or
other rights with respect to the issuance of the Acquired Shares
shall have irrevocably waived the same in writing. All
shareholder agreements, voting agreements, registration rights
agreements and similar agreements relating to the capital stock
of PRTI shall have been terminated by all parties to such
agreements.
12
<PAGE>
(h) Other Waivers and Consents. PRTI shall have obtained all other
necessary waivers or consents to the execution of this Agreement
and the related agreements.
(i) Stockholder and Board of Director Approvals. If required by
applicable law or the Organizational Documents of either IBL or
PRTI, this Agreement shall have been approved and adopted by the
requisite vote of the shareholders and Board of Directors of PRTI
and/or IBL and the issuance of the Acquired Shares pursuant to
this Agreement shall have been approved by the requisite vote of
the shareholders and Board of Directors of PRTI.
(j) License Agreement. PRTI has executed and delivered a license
agreement granting a license to IBL to use certain licenses and
patents that are a part of the Acquired Assets (the "License
Agreement") in form and substance to the mutual satisfaction of
PRTI and IBL.
(k) Registration Rights Agreement. PRTI has executed and delivered a
Registration Rights Agreement to IBL regarding the Acquired
Shares in form and substance to the mutual satisfaction of PRTI
and IBL.
(l) Creditor Consents. IBL shall have received, on or before the
Closing Date all necessary consents from those creditors which
have perfected security interests in any of the Acquired Assets.
Such consents shall be in form and substance to the mutual
satisfaction of PRTI and IBL.
4.2 Conditions to the Obligations of PRTI. The obligation of PRTI to issue
the Acquired Shares and, purchase the Acquired Assets, and assume the Assumed
Liabilities on the Closing Date is, at its option, subject to the satisfaction
or waiver by PRTI, on or before the Closing Date, of the following conditions:
(a) Representations and Warranties of IBL to be True and Correct. The
representations and warranties of IBL contained in Article II
shall be true, complete and correct on and as of the Closing Date
with the same effect as though such representations and
warranties had been made on and as of such date, and the
President and Treasurer of IBL shall have certified to PRTI in
writing to such effect.
(b) Performance. IBL shall have performed and complied with all
agreements contained herein required to be performed or complied
with by it prior to or at the Closing Date, and the President and
Treasurer of IBL shall have certified to PRTI in writing to such
effect and to the further
13
<PAGE>
effect that all of the conditions set forth in this Section 4.2
have been satisfied.
(c) Due Diligence. PRTI shall have completed its due diligence
investigation of IBL and shall be satisfied in its sole
discretion in all respects with the findings thereof.
(d) Proceedings to be Satisfactory. All corporate and other
proceedings to be taken by IBL in connection with the
transactions contemplated hereby and all documents incident
thereto shall be reasonably satisfactory in form and substance to
PRTI, and PRTI and its counsel shall have received all such
counterpart originals or certified or other copies of such
documents as they reasonably may request.
(e) Conveyance of the Acquired Assets. IBL shall have conveyed the
Acquired Assets to PRTI on the Closing Date.
(f) Stockholder Approvals. If required by applicable law, or the
Organizational Documents of either IBL or PRTI, this Agreement
shall have been approved and adopted by the requisite vote of the
shareholders and Board of Directors of PRTI and/or IBL and the
issuance of the Acquired Shares pursuant to this Agreement shall
have been approved by the requisite vote of the shareholders and
Board of Directors of PRTI.
(g) No Adverse Action. There shall not be any injunction, judgment,
order, decree, ruling, or charge in effect preventing
consummation of any of the transactions contemplated by this
Agreement.
(h) Certificate of IBL. IBL shall have delivered to PRTI a
certificate to the effect that each of the conditions specified
above in Sections 4.2(a) through (h) is satisfied in all
respects.
(i) Final Inspection of Acquired Assets. PRTI or its representatives
shall have been afforded an opportunity, within forty-eight (48)
hours prior to Closing, to conduct an on-site inspection of the
Acquired Assets and based on such inspection or otherwise shall
have reasonably determined that the Acquired Assets shall be
acceptable to PRTI.
(j) Employment Agreements. PRTI shall have received executed
employment agreements of key employees of IBL, specifically, Pam
Dixon, Dave Kettmann and Patricia Johnson, to ensure the complete
transfer of knowledge and technology to PRTI regarding the
purchase of the Acquired Assets.
14
<PAGE>
(k) Registration Rights Agreement. IBL and PRTI shall have entered
into a mutually satisfactory Registration Rights Agreement with
respect to the Acquired Shares.
(l) Creditor Consents. IBL shall have received, on or before the
Closing Date, all necessary consents from those creditors which
have perfected security interests in any of the Acquired Assets.
Such consents shall be in form and substance to the mutual
satisfaction of PRTI and IBL.
ARTICLE V
COVENANTS OF PRTI
PRTI covenants and agrees that, unless IBL otherwise agrees in writing,
from the date of this Agreement until the Closing:
5.1 Corporate Existence. PRTI shall maintain its corporate existence and
all of its rights and licenses necessary to maintain its business in full force
and effect.
5.2 Compliance with Laws. PRTI shall comply with all applicable Laws,
noncompliance with which could Materially Adversely Affect it's business or
condition, financial or otherwise.
5.3 Appropriate Action; Consents; Filings. PRTI shall use its best efforts
to (i) take, or cause to be taken, all appropriate action, and do, or cause to
be done, all things necessary, proper or advisable under applicable Law to
consummate and make effective the transactions contemplated by this Agreement;
(ii) obtain all consents, licenses, permits, waivers, approvals, authorizations
or orders required under applicable Law (including, without limitation, all
foreign and domestic (federal, state and local) governmental and regulatory
rulings and approvals of parties to Contracts) in connection with the
authorization, execution and delivery of this Agreement and the consummation by
PRTI of the transactions contemplated hereby; and (iii) make all necessary
filings, and thereafter make any other required submissions, with respect to
this Agreement required under (A) the Securities Act and the Exchange Act and
the rules and regulations promulgated thereunder, and any other applicable
federal or state securities laws; and (B) any other applicable Law.
5.4 Indemnification.
(a) In addition to all rights and remedies available to IBL at law or in
equity, PRTI shall indemnify, defend and hold harmless IBL and any
parent, subsidiary, associate, affiliate, partner, shareholder,
director, officer, employee or agent (all of the foregoing are
collectively referred to as the "Indemnified Parties") of IBL from and
-------------------
against and pay on behalf of or reimburse such party as and when
15
<PAGE>
incurred all losses, including, without limitation, Liabilities,
demands, claims, actions or causes of action, costs, damages,
judgments, debts, settlements, assessments, deficiencies, taxes,
penalties, fines or expenses, whether or not arising out of any claims
by or on behalf of any third party, including interest, penalties,
reasonable attorneys' fees and expenses and all reasonable amounts
paid in investigation, defense or settlement of any of the foregoing
(collectively, "Losses") which any such party may suffer, sustain or
------
become subject to, as a result of, in connection with, or relating to
or by virtue of:
(i) any material misrepresentations or material breach of
warranty on the part of PRTI under Article III;
(ii) any material misrepresentation in or material omission
from any of the representations or warranties contained in
this Agreement or in any Schedule delivered to IBL by or
on behalf of PRTI in connection herewith;
(iii) any material nonfulfillment or breach of any covenant or
agreement on the part of PRTI under this Agreement; or
(iv) any action, demand, proceeding, investigation or claim by
any third party, including, without limitation, Government
Entities against or affecting any PRTI Affiliated Company
or any of their affiliates which, if successful, would
give rise to or evidence the existence of or relate to a
material breach of (A) any of the material representations
or warranties at the time made or (B) the covenants of
PRTI.
(b) All indemnification rights hereunder shall survive the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereunder for a period of two (2) years, regardless of
any investigation, inquiry or examination made for or on behalf of, or
any Knowledge of, IBL and/or any of the other Indemnified Parties or
the acceptance by IBL of any certificate or opinion.
(c) If for any reason the indemnity provided for in this Section 5.4 is
unavailable to any Indemnified Party or is insufficient to hold each
such Indemnified Party harmless from all such Losses arising with
respect to the transactions contemplated hereunder, then PRTI and the
Indemnified Party shall each contribute to the amount paid or payable
by such Loss in such proportion as is appropriate to reflect not only
the relative benefits received by PRTI on the one hand, and such
Indemnified Party on the other, but also the relative fault of PRTI on
the one hand, and the Indemnified Party on the other, as well as any
relevant
16
<PAGE>
equitable considerations. In addition, PRTI agrees to reimburse any
Indemnified Party upon demand for all reasonable expenses, including
legal counsel fees, incurred by such Indemnified Party or any such
other person in connection with investigating, preparing or defending
any such action or claim. The indemnity, contribution and expense
reimbursement obligations that PRTI has under this Section 5.4 shall
be in addition to any liability that PRTI may otherwise have. PRTI
further agrees that the indemnification and reimbursement commitments
set forth in this Agreement shall apply whether or not the Indemnified
Party is a formal party to any such lawsuits, claims or other
proceedings.
(d) Any indemnification of either IBL or any other Indemnified Party by
PRTI pursuant to this Section 5.4 shall be effected by wire transfer
of immediately available funds from PRTI to an account designated by
IBL or such other Indemnified Party within 15 days after the
determination thereof.
5.5 Confidentiality. PRTI shall, and shall cause each other PRTI
Affiliated Company to, maintain in confidence, and cause their respective
directors, officers, employees, agents and advisors to maintain in confidence,
any written, oral or other information obtained in confidence from IBL in
connection with this Agreement or the contemplated transactions. If this
Agreement is terminated, PRTI shall return or destroy as much of such written
information as IBL may reasonably request.
ARTICLE VI
COVENANTS OF IBL
IBL covenants and agrees that, unless PRTI otherwise agrees in
writing, from the date of this Agreement until the Closing:
6.1 Operation of Business. From and after the date of this Agreement and
until the Closing Date, IBL will conduct its business in a reasonable and
prudent manner as far as is practicable in accordance with past practices, and
will use its best efforts to preserve its existing business and relationships
with its employees, customers, and others, to preserve and protect the Acquired
Assets, and to conduct its business in compliance with all applicable laws and
regulations. During that period, IBL will not make any material divestitures of
assets (other than inventory sold in the normal and Ordinary Course of Business
as presently conducted), and will not encumber any of the Acquired Assets, or
any other assets, rights, or interests which are subject to this Agreement. IBL
will not otherwise engage in any practice, take any action, or enter into any
transaction outside the Ordinary Course of Business. From and after the date of
this Agreement and until the Closing, IBL shall refrain from any action or
inaction with third parties that may jeopardize clean and clear title to the
Acquired Assets.
6.2 Full Access. IBL will permit representatives of PRTI to have full
access at all reasonable times, and in a manner so as not to interfere with the
normal business operations of
17
<PAGE>
IBL, to all premises, properties, personnel, books, records (including tax
records), contracts, and documents of or pertaining to IBL.
6.3 Exclusivity. IBL will not solicit, initiate, or encourage the
submission of any proposal or offer from any Person relating to the acquisition
of all or substantially all of the capital stock or assets of IBL (including any
acquisition structured as a merger, consolidation, or share exchange).
6.4 Appropriate Action; Consents; Filings. IBL shall use its best efforts
to (i) take, or cause to be taken, all appropriate action, and do, or cause to
be done, all things necessary, proper or advisable under applicable Law to
consummate and make effective the transactions contemplated by this Agreement;
(ii) obtain all consents, licenses, permits, waivers, approvals, authorizations
or orders required under applicable Law (including, without limitation, all
foreign and domestic (federal, state and local) governmental and regulatory
rulings and approvals of parties to Contracts) necessary to be obtained by IBL
in connection with the authorization, execution and delivery of this Agreement
and the consummation by IBL of the transactions contemplated hereby; and (iii)
make all necessary filings, and thereafter make any other required submissions,
with respect to this Agreement required under (A) the Securities Act and the
Exchange Act and the rules and regulations promulgated thereunder, and any other
applicable federal or state securities laws; and (B) any other applicable Law.
6.5 Indemnification.
(a) In addition to all rights and remedies available to PRTI at law
or in equity, IBL shall indemnify, defend and hold harmless PRTI
and any Indemnified Party of PRTI from and against and pay on
behalf of or reimburse such party as and when incurred all
losses, including, without limitation, Liabilities, demands,
claims, actions or causes of action, costs, damages, judgments,
debts, settlements, assessments, deficiencies, taxes, penalties,
fines or expenses, whether or not arising out of any claims by or
on behalf of any third party, including interest, penalties,
reasonable attorneys' fees and expenses and all reasonable
amounts paid in investigation, defense or settlement of any of
the foregoing (collectively, "PRTI Losses") which any such party
------
may suffer, sustain or become subject to, as a result of, in
connection with, or relating to or by virtue of:
(v) any material misrepresentations or material breach of
warranty on the part of IBL under Article II;
(vi) any material misrepresentation in or material omission from
any of the representations or warranties contained in this
Agreement or
18
<PAGE>
the Schedules delivered to PRTI by or on behalf of IBL in
connection herewith;
(vii) any material nonfulfillment or breach of any covenant or
agreement on the part of IBL under this Agreement;
(viii) any action, demand, proceeding, investigation or claim by
any third party, including, without limitation, Government
Entities against or affecting any IBL Affiliated Company
or any of their affiliates which, if successful, would
give rise to or evidence the existence of or relate to a
material breach of (A) any of the material representations
or warranties at the time made or (B) the covenants of
IBL;
(ix) any action, demand, proceeding, investigation or claim by
any third party regarding the Acquired Assets whereby such
action, demand, proceeding, investigation or claim is
based upon certain agreements, actions or breaches by IBL
regarding the use or ownership of the Acquired Assets
prior to the date hereof; or
(x) any claims for damages, losses, diminution in value of any
asset which remains on the premises of 215 Castro Street,
Mountain View, California 94041, following the date
hereof.
(b) All indemnification rights hereunder shall survive the execution
and delivery of this Agreement and the consummation of the
transactions contemplated hereunder for a period of two (2) years
regardless of any investigation, inquiry or examination made for
or on behalf of, or any Knowledge of, PRTI and/or any of the
other PRTI Indemnified Parties or the acceptance by PRTI of any
certificate or opinion.
(c) If for any reason the indemnity provided for in this Section 6.5
is unavailable to any PRTI Indemnified Party or is insufficient
to hold each such PRTI Indemnified Party harmless from all such
PRTI Losses arising with respect to the transactions contemplated
hereunder, then IBL and the PRTI Indemnified Party shall each
contribute to the amount paid or payable by such PRTI Loss in
such proportion as is appropriate to reflect not only the
relative benefits received by IBL on the one hand, and such PRTI
Indemnified Party on the other, but also the relative fault of
IBL on the one hand, and the PRTI Party on the other, as well as
any relevant equitable considerations. In addition, IBL agrees to
reimburse any PRTI Party upon demand for all reasonable expenses,
including legal counsel
19
<PAGE>
fees, incurred by such PRTI Indemnified Party or any such other
person in connection with investigating, preparing or defending
any such action or claim. The indemnity, contribution and expense
reimbursement obligations that IBL has under this Section 6.5
shall be in addition to any liability that IBL may otherwise
have. IBL further agrees that the indemnification and
reimbursement commitments set forth in this Agreement shall apply
whether or not the PRTI Indemnified Party is a formal party to
any such lawsuits, claims or other proceedings.
(d) Any reimbursements owed to PRTI by IBL hereunder shall be paid by
IBL (i) first out of the Escrow Account as described in Section
1.4 hereof (for which purpose any Acquired Shares which are
transferred to PRTI out of the escrow created by the Escrow
Agreement shall be valued at the average sale price of such
shares on the senior market or quotation system on which such
Shares are then listed or quoted over the ten (10) trading days
immediately preceding the date on which such Shares are so
transferred, and (ii) then, to the extent of the balance,
effective by wire transfer of immediately available funds from
IBL to an account designated by PRTI or such other PRTI
Indemnified Party within 15 days after the determination thereof.
6.6 Confidentiality. IBL shall, and shall cause each other IBL Affiliated
Company to, maintain in confidence, and cause their respective directors,
officers, employees, agents and advisors to maintain in confidence, any written,
oral or other information obtained in confidence from PRTI in connection with
this Agreement or the contemplated transactions. If this Agreement is
terminated, IBL shall return or destroy as much of such written information as
PRTI may reasonably request.
6.7 IBL Schedules. Within ten (10) business days of the date of this
Agreement, IBL will deliver to PRTI a set of schedules (the "IBL Schedules")
-------------
identifying (a) the Acquired Assets described in Section 1.2(d), and (b) any
exceptions to the representations and warranties of IBL set forth in Article II.
ARTICLE VII
TERMINATION
7.1 Termination. This Agreement may be terminated at any time prior to the
Closing Date:
(a) by the written agreement of IBL and PRTI;
20
<PAGE>
(b) by either IBL or PRTI by written notice to the other party if the
transactions contemplated hereby shall not have been consummated
pursuant hereto by 5:00 p.m. Chicago time on December 31, 2000,
or such later date as may be selected by the mutual written
consent of IBL and PRTI, provided that no party may give such
notice if its breach of this Agreement has precluded the
consummation of this Agreement;
(c) by PRTI by written notice to IBL if (i) the representations and
warranties of IBL shall not have been true and correct in all
respects (in the case of a representation or warranty containing
a materiality qualification) or in all material respects (in the
case of a representation or warranty without a materiality
qualification) as of the date when made, or (ii) if any of the
conditions set forth in Section 4.2 shall not have been, or if it
becomes apparent that any of such conditions will not be,
fulfilled by 5:00 p.m. Chicago time, on December 31, 2000, or
such later date as may be selected by the mutual written consent
of IBL and PRTI, unless such failure shall be due to the failure
of PRTI to perform or comply with any of the covenants,
agreements, or conditions hereof to be performed or complied with
by it prior to the Closing; or
(d) by IBL by written notice to PRTI if (i) the representations and
warranties of PRTI shall not have been true and correct in all
respects (in the case of a representation or warranty containing
a materiality qualification) or in all material respects (in the
case of a representation or warranty without a materiality
qualification) as of the date when made, (ii) if any of the
conditions set forth in Section 4.1 shall not have been, or if it
becomes apparent that any of such conditions will not be,
fulfilled by 5:00 p.m. Chicago time, on December 31, 2000, or
such later date may be selected by the mutual written consent of
IBL and PRTI, unless such failure shall be due to the failure of
IBL to perform or comply with any of the covenants, agreements,
or conditions hereof to be performed or complied with by it prior
to the Closing, or (iii) in the event IBL elects to terminate by
reason of the option provided in Section 4.2(f).
7.2 Effect of Termination. In the event of the termination of this
Agreement pursuant to Section 7.1, this Agreement shall become void, without any
liability to any party in respect hereof or the transactions contemplated hereby
on the part of any party hereto or any of their respective directors, officers,
employees, agents, consultants, representatives, advisers or shareholders,
provided, however, that: (a) nothing shall release a breaching party from
liability for damages resulting from its breach of this Agreement, and (b)
Sections 5.5, 6.6, 7.2, and Articles VIII and IX shall survive indefinitely
subject to applicable statutes of limitations.
21
<PAGE>
ARTICLE VIII
MISCELLANEOUS
8.1 Expenses. Each party hereto will pay its own expenses in connection
with the transactions contemplated hereby, whether or not such transactions
shall be consummated.
8.2 Survival of Agreements. All covenants, agreements, representations and
warranties made herein or in any other agreement, or any certificate or
instrument delivered to IBL pursuant to or in connection with this Agreement,
shall survive the Closing for a period of two (2) years.
8.3 Remedies. In case any one or more of the representations, warranties,
covenants or agreements set forth in this Agreement shall have been breached by
any party hereto, the party or parties entitled to the benefit of such
representations, warranties, covenants or agreements may proceed to protect and
enforce their rights either under the indemnification provisions of this
Agreement or by suit in equity and/or action at law, including, but not limited
to, an action for damages as a result of any such breach and/or an action for
specific performance of any such covenant or agreement contained in this
Agreement. The rights, powers and remedies of the parties under this Agreement
are cumulative and not exclusive of any other right, power or remedy which such
parties may have under any other agreement or law. No single or partial
assertion or exercise of any right, power or remedy of a party hereunder shall
preclude any other or further assertion or exercise thereof.
8.4 Brokerage. Each party will indemnify and hold harmless the other
against and in respect of any claim for brokerage or other commissions relative
to this Agreement or to the transactions contemplated hereby, based in any way
on agreements, arrangements or understandings made or claimed to have been made
with any third party.
8.5 Parties in Interest. All representations, covenants and agreements
contained in this Agreement by or on behalf of any of the parties hereto shall
bind and inure to the benefit of the respective successors and assigns of the
parties hereto whether so expressed or not. Without limiting the generality of
the foregoing, all representations, covenants and agreements benefiting IBL
shall inure to the benefit of any and all subsequent holders from time to time
of the Acquired Shares.
8.6 Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be delivered in person or sent by
overnight delivery or by certified or registered mail, return receipt requested,
addressed as follows:
(a) if to PRTI, at Phoenix Resources Technologies, Inc., 10153
Parkwood Drive, Suite 6, Cupertino, California 95014, telecopier:
(775) 628-6017, Attention: Michael Lamb, with a copy to Eric M.
Fogel, Esquire, Duane,
22
<PAGE>
Morris & Heckscher LLP, 227 West Monroe Street, Suite 3400,
Chicago, Illinois 60606, telecopier: (312) 499-6701;
(b) if to IBL, at iBuyLine, Inc., 215 Castro Street, Mountain View,
California 94041, telecopier: (___) ___-____, Attention: Edward
V. Lauing, President, with a copy to Philip S. Boone, Jr., Esq.,
Coblentz, Patch, Duffy & Bass, LLP, 222 Kearny Street, 7th Floor,
San Francisco, CA 94108, telecopier: (415) 989-1663;
or, in any such case, at such other address or addresses as shall have been
furnished in writing by such party to the others as provided herein.
All notices, consents or other communications required or permitted to be
given under this Agreement shall be deemed to have been duly given and received
(i) when delivered personally, (ii) three (3) business days after being mailed
by first class mail, postage prepaid, or (iii) one (1) business day after being
sent by a reputable overnight delivery service, postage or delivery charges
prepaid, to the parties at their respective addresses stated on the signature
page of this Agreement. Notices may also be given by telecopier and shall be
effective on the date transmitted if confirmed within 24 hours thereafter by a
signed original sent in the manner provided in the preceding sentence.
8.7 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California notwithstanding any
conflicts-of-law doctrines of such state or any other jurisdiction to the
contrary. EACH OF THE PARTIES HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY
JURY IN ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT. E
8.8 Entire Agreement. This Agreement, including the Schedules hereto,
together with the other writings referred to herein or delivered pursuant hereto
which form a part hereof, constitutes the sole and entire agreement of the
parties with respect to the subject matter hereof. All Schedules hereto are
hereby incorporated herein by reference.
8.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.10 Amendments. This Agreement may not be amended or modified, and no
provisions hereof may be waived, without the written consent of PRTI and IBL.
8.11 Severability. The invalidity or unenforceability of any term, phrase,
clause, paragraph, restriction, covenant, agreement or other provision hereof
shall in no way affect the validity or enforceability of any other provision, or
any part thereof, but this Agreement shall be construed as if such invalid or
unenforceable term, phrase, clause, paragraph, restriction,
23
<PAGE>
covenant, agreement or other provision had never been contained herein unless
the deletion of such term, phrase, clause, paragraph, restriction, covenant,
agreement or other provision would result in such a material change as to cause
the covenants and agreements contained herein to be unreasonable or would
materially and adversely frustrate the objectives of the parties as expressed in
this Agreement.
8.12 Titles and Subtitles. The titles and subtitles used in this Agreement
are for convenience only and are not to be considered in construing or
interpreting any term or provision of this Agreement.
8.13 Public Announcements. PRTI and IBL shall consult with each other
before issuing any press release or otherwise making any public statement
relating to the subject matter of this Agreement and shall not issue any such
press release or make any such public statement prior to such consultation and
without the consent of the other party which shall not be unreasonably withheld,
except as may be required by federal securities laws.
8.14 Bulk Transfer Laws. PRTI acknowledges that IBL will not comply with
the provisions of any bulk transfer laws of any jurisdiction in connection with
the transactions contemplated by this Agreement.
ARTICLE IX
DEFINITIONS
9.1 "Affiliated Companies" means a Party and its Subsidiaries,
collectively.
9.2 "Common Stock" means PRTI's Common Stock, $.0001 par value.
9.3 "Contract" means any agreement, contract, obligation, promise, or
undertaking (whether written or oral and whether express or implied) that is
legally binding.
9.4 "Environmental Laws" means any and all Laws, permits, concessions,
grants, franchises, licenses, agreements or governmental restrictions relating
to pollution and the protection of the environment or the release of any
materials into the environment, including but not limited to those relating to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.
9.5 "Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Exchange Act shall include reference to the comparable
section, if any, of any successor federal statute.
9.6 "Government Entity" means any supranational, national, foreign,
federal, state or local judicial, legislative, executive, administrative or
regulatory body or authority.
24
<PAGE>
9.7 "Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances, including but not limited to biomedical waste,
that might pose a hazard to health or safety, the removal of which may be
required or the generation, manufacture, refining, production, processing,
treatment, storage, handling, transportation, transfer, use, disposal, release,
discharge, spillage, seepage, or filtration of which is or shall be restricted,
prohibited or penalized by any applicable Law (including, without limitation,
asbestos, urea formaldehyde foam insulation and polychlorinated biphenyls).
9.8 "Knowledge" or "to Know" means actual knowledge after reasonable
review of internal corporate documents and files.
9.9 "Laws" includes any applicable foreign, federal, state, or local law,
statute, rule, regulation, Order or other restriction of any court or other
Government Entity.
9.10 "Liability" means any debt, liability or obligation, whether known or
unknown, asserted or unasserted, accrued, absolute, contingent or otherwise,
whether due or to become due.
9.11 "Material Adverse Effect" or "Materially Adversely Affect" means any
event or change which has a material adverse effect on (a) the properties,
business, prospects, operations, earnings, assets, liabilities or the condition
(financial or otherwise) of a party taken as a whole, whether or not in the
ordinary course of business, (b) the ability of a party to perform its
obligations under this Agreement or (c) the validity or enforceability of this
Agreement.
9.12 "Ordinary Course of Business" -- an action taken by a Person will be
deemed to have been taken in the "Ordinary Course of Business" only if: (a) such
action is consistent with the past practice of such Person (including with
respect to quality and frequency) and is taken in the ordinary course of the
normal day-to-day operations of such Person; and (b) such action is not required
to be authorized by the board of directors of such Person (or by any Person or
group of Persons exercising similar authority).
9.13 "Organizational Documents" means the articles or certificate of
incorporation and the bylaws of a corporation; the partnership agreement and any
statement of partnership of a general partnership; the limited partnership
agreement and the certificate of the limited partnership of a limited
partnership; any charter or similar document adopted or filed in connection with
the creation, formation, or organization of a Person; and any amendment to any
of the foregoing.
9.14 "Person" means any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, or other entity
or Government Entity.
9.15 "SEC" means the United States Securities and Exchange Commission.
25
<PAGE>
9.16 "Securities Act" shall mean the Securities Act of 1933, as amended, or
any successor federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Act shall include reference to the
comparable section, if any, of any successor federal statute.
9.17 "Subsidiary" with respect to any Person (the "Owner") means any
corporation or other Person of which securities or other interests having the
power to elect a majority of that corporation's or other Person's board of
directors or similar governing body, or otherwise having the power to direct the
business and policies of that corporation or other Person (other than securities
or other interests having such power only upon the happening of a contingency
that has not occurred) are held by the Owner or one or more of its Subsidiaries.
(Signature page to follow.)
26
<PAGE>
IN WITNESS WHEREOF, PRTI and IBL have executed this Agreement on the 31/st/
of October 2000.
PHOENIX RESOURCES TECHNOLOGIES, INC.
By: /s/ Michael Lamb
----------------------------------------------
Title: Vice President and Chief Operations Officer
--------------------------------------------
IBUYLINE, INC.
By: /s/ Edward V. Lauing
----------------------------------------------
Title: President and Chief Executive Officer
--------------------------------------------
27
<PAGE>
EXHIBIT A
ACQUIRED ASSETS
For purposes of the Asset Purchase Agreement, the following assets of IBL
shall be and constitute the Acquired Assets.
Notwithstanding anything to the contrary in the Asset Purchase Agreement of
which this Exhibit is a part, the assets of IBL which are described above shall
include the intellectual property used in connection with IBL's business,
including the software and patents described in Section 6.7, goodwill associated
therewith, licenses and sublicenses granted and obtained with respect thereto,
and rights thereunder, remedies against infringements thereof, and rights to
protection of interests therein under the laws of all jurisdictions in which IBL
conducts business.
28
