EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT (the "AGREEMENT") is made and entered into
as of November _/S/ 15__, 2002, by and among PROJECT IV, INC., a Nevada
corporation ("PROJECT IV"), WILLIAM E. KING, III ("KING"), M. PHILLIP WAGGONER
("WAGGONER"), and ROBERT A. GILLGRIST ("GILLGRIST" and, collectively, King,
Waggoner, and Gillgrist are referred to as the "CROWFLY TEAM").
RECITALS:
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A. The Crowfly Team owns all of the existing rights to the Crowfly
business plan, as described in Exhibit A (the "ASSET").
B. The Crowfly Team desires to sell all of their rights to the Asset and
Project IV desires to purchase all of the Crowfly Team's rights to the Asset on
the terms and conditions set forth herein.
AGREEMENT:
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NOW, THEREFORE, in consideration of the mutual agreements, covenants and
premises set forth herein for certain other good and valuable consideration, the
receipt and adequacy which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. ASSET PURCHASE, PURCHASE PRICE AND RELATED TRANSACTIONS.
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1.1. SALE OF ASSET. Subject to the terms and conditions hereof, the
Crowfly Team shall cause to be sold to Project IV, at the Closing (as defined
below), and Project IV shall purchase and accept at the Closing, ownership of
the Asset, free and clear of all liens and encumbrances of any kind.
1.2. PURCHASE PRICE. As consideration for the sale of the Asset to Project
IV, at the Closing, Project IV shall issue and deliver to the Crowfly Team Three
Hundred Sixty Million (360,000,000) shares of common stock of Project IV (the
"SHARES").
1.3. CLOSING AND EFFECTIVE DATE. The closing shall occur simultaneously
with the execution of this Agreement (the "CLOSING"). The date of Closing is
referred to herein as the "CLOSING DATE." At the Closing:
1.3.1. The Crowfly Team shall execute and deliver to Project IV such
assignments and other documents as may (in the reasonable judgment of Project IV
or its counsel) be necessary or appropriate to assign, convey, transfer and
deliver to Project IV ownership of the Asset free of any liens and/or
encumbrances; and
1.3.2. Project IV shall execute and deliver to the Crowfly Team the
Shares as contemplated by Section 1.2(a).
1.3.3. Promptly after the Closing, Project IV shall change its name
to "Crowfly, Inc."
1.3.4. Prior to the Closing, Project IV shall have 800,000,000 shares
of common stock authorized for issuance, of which 240,000,000 shares of common
stock shall be outstanding.
1.3.5. Promptly after Closing, each member of the Crowfly Team will
enter into employment agreements with Project IV to operate Project IV.
2. ADDITIONAL AGREEMENTS.
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2.1. CONFIDENTIAL TREATMENT OF INFORMATION. From and after the date
hereof, the parties hereto shall and shall cause their representatives to hold
in confidence this Agreement (including the Exhibits hereto), all matters
relating hereto and all data and information obtained with respect to the other
parties, the Asset or their business, except such data or information as is
published or is a matter of public record, or as compelled by legal process.
2.2. PUBLIC ANNOUNCEMENTS. The parties will consult with each other before
issuing any press releases or otherwise making any public statement with respect
to this Agreement or any of the transactions contemplated hereby and no party
will issue any such press release or make any such public statement without the
prior written consent of the other parties, except as may be required by law or
by the rules and regulations of any governmental authority or securities
exchange.
2.3. NONCOMPETE. The Crowfly Team created and has knowledge of the
contents of the Asset. In further consideration for the purchase of the Asset,
each member of the Crowfly Team hereby agrees that, during any time any member
of the Crowfly Team is an employee of Project IV or immediately following the
Closing, whichever occurs later, and for a period of two (2) years (which period
of time is agreed to by the parties to be reasonable) following the termination
of each member of the Crowfly Team's employment with Project IV, whether such
termination is by Project IV or the employee, with or without cause, he will not
in any manner, either directly or indirectly, including, without limitation, as
an owner, investor, independent contractor, partner, member, joint venturer,
shareholder, manager, officer, director, consultant, employee, agent, or
licensee, for any person, firm, partnership, corporation, limited liability
company or other entity, compete with Project IV, its affiliates, successors or
assigns in Project IV's business anywhere within the United States and shall not
establish any business similar in any respect to the business described in the
Asset.
3. REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE CROWFLY TEAM.
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To further induce Project IV to enter into this Agreement and to
consummate the transactions contemplated hereby, each member of the Crowfly Team
jointly and severally represent and warrant to and covenant with Project IV as
follows:
3.1. AUTHORITY RELATIVE TO THIS AGREEMENT. The execution and delivery of
this Agreement by each member of the Crowfly Team and the consummation by each
member of the Crowfly Team of the transactions contemplated by this Agreement
have been duly authorized by all necessary action on the part of each member of
the Crowfly Team as is necessary to authorize this Agreement or to consummate
the transactions contemplated by this Agreement. This Agreement has been duly
and validly executed and delivered by each member of the Crowfly Team and
constitutes the legal, valid and binding obligations of each member of the
Crowfly Team, enforceable against each member of the Crowfly Team in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization or other similar laws of general
application affecting the enforcement of creditors' rights generally.
3.2. INTELLECTUAL PROPERTY. Each member of the Crowfly Team has the
exclusive right to the Asset, and the use of such Asset does not conflict with
or infringe upon the rights of any other person. No member of the Crowfly Team
is (or Project IV), or will be, subject to any liability, direct or indirect,
for infringement damages, royalties, or otherwise, by reason of (a) the use of
the name "Crowfly" in or outside the United States or (b) the establishment of
the business operations set forth in the Asset by Project IV.
3.3. ASSET.
3.3.1. The Crowfly Team owns the Asset free and clear of all liens
and encumbrances and no other person has any rights to the Asset or any part
thereof or any right to establish a business similar to the business described
in the Asset.
3.3.2. The Asset constitutes the Crowfly business plan, which is
fully described in Exhibit A.
3.4. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC. The execution and
delivery of this Agreement by each member of the Crowfly Team does not, and the
consummation of the transactions contemplated hereby will not, constitute a
breach or violation of the charter or Bylaws of each member of the Crowfly Team,
or a default under any of the terms, conditions or provisions of (or an act or
omission that would give rise to any right of termination, cancellation or
acceleration under) any material note, bond, mortgage, lease, indenture,
agreement or obligation to which each member of the Crowfly Team is a party,
pursuant to which it otherwise receives benefits, or by which any of its
properties may be bound.
3.5. CONTINGENCIES. There are no actions, suits, claims or proceedings
pending, or, to the knowledge of the Crowfly Team, after reasonable
investigation, threatened against, by or affecting the Asset in any court or
before any arbitrator or governmental agency. To the knowledge of the Crowfly
Team, after reasonable investigation, there is no valid basis upon which any
such action, suit, claim, or proceeding may be commenced or asserted against the
Asset. There are no agreements to which the Asset is subject which could effect
the Asset.
3.6. FULL DISCLOSURE. No representation or warranty of the Crowfly Team
contained in this Agreement, and none of the statements or information
concerning the Asset contained in this Agreement and the Exhibit, contains or
will contain any untrue statement of a material fact nor will such
representations, warranties, covenants or statements taken as a whole omit a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
4. REPRESENTATIONS AND WARRANTIES OF PROJECT IV.
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To induce the Crowfly Team to enter into this Agreement and to consummate
the transactions contemplated hereby, Project IV represents and warrants to and
covenants with the Crowfly Team as follows:
4.1. ORGANIZATION. Project IV is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada and has the
requisite power and authority to own, lease and operate its properties.
4.2. AUTHORITY RELATIVE TO THIS AGREEMENT. The execution and delivery of
this Agreement by Project IV and the consummation by Project IV of the
transactions contemplated by this Agreement have been duly authorized by all
necessary action on the part of Project IV as is necessary to authorize this
Agreement or to consummate the transactions contemplated by this Agreement. This
Agreement has been duly and validly executed and delivered by Project IV and
constitutes the legal, valid and binding obligations of Project IV, enforceable
against Project IV in accordance with its terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or other
similar laws of general application affecting the enforcement of creditors'
rights generally.
4.3. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC. The execution and
delivery of this Agreement by Project IV does not, and the consummation of the
transactions contemplated hereby will not, constitute a breach or violation of
the charter or Bylaws of Project IV, or a default under any of the terms,
conditions or provisions of (or an act or omission that would give rise to any
right of termination, cancellation or acceleration under) any material note,
bond, mortgage, lease, indenture, agreement or obligation to which Project IV is
a party, pursuant to which it otherwise receives benefits, or by which any of
its properties may be bound.
4.4. FULL DISCLOSURE. No representation or warranty of Project IV
contained in this Agreement, and none of the statements or information
concerning Project IV contained in this Agreement and the Exhibits, contains or
will contain any untrue statement of a material fact nor will such
representations, warranties, covenants or statements taken as a whole omit a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
5. INDEMNIFICATION.
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5.1. INDEMNIFICATION BY THE CROWFLY TEAM. Each member of the Crowfly Team
(hereinafter collectively called the "INDEMNITOR") shall jointly and severally
defend, indemnify and hold harmless Project IV, its direct and indirect parent
corporations, subsidiaries and affiliates, their officers, directors,
shareholders, employees and agents (hereinafter collectively called "PROJECT IV
INDEMNITEES") against and in respect of any and all loss, damage, liability,
fine, penalty, cost and expense, including reasonable attorneys' fees and
amounts paid in settlement (collectively, "PROJECT IV INDEMNIFIED LOSSES"),
suffered or incurred by any Project IV Indemnitee by reason of, or arising out
of any misrepresentation, breach of warranty or breach or non-fulfillment of any
agreement of any member of the Crowfly Team contained in this Agreement or in
any certificate, exhibit, instrument or document delivered to Project IV by or
on behalf of any member of the Crowfly Team pursuant to the provisions of this
Agreement (without regard to materiality thresholds contained therein).
5.2. INDEMNIFICATION BY PROJECT IV. Project IV (hereinafter called the
"INDEMNITOR") shall defend, indemnify and hold harmless each member of the
Crowfly Team (hereinafter collectively called "INDEMNITEE") against and in
respect of any and all loss, damage, liability, cost and expense, including
reasonable attorneys' fees and amounts paid in settlement (collectively,
"INDEMNIFIED LOSSES"), suffered or incurred by the Indemnitee by reason of or
arising out of any misrepresentation, breach of warranty or breach or
non-fulfillment of any material agreement of Project IV contained in this
Agreement or in any other certificate, exhibit, instrument or document delivered
to the Crowfly Team by or on behalf of Project IV pursuant to the provisions of
this Agreement.
6. MISCELLANEOUS.
6.1. NOTICES.
6.1.1. All notices, requests, demands, or other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given upon delivery if delivered in person or if sent by Federal
Express (or similar recognized international express courier service) to the
parties at the following addresses:
If to Crowfly Team: 220 William Street Extension
Mount Pleasant, South Carolina 29464
Attention: William E. King, III
If to Project IV: 4702 Oleander Drive, Suite 200
Myrtle Beach, South Carolina 29577
Attention: John Gandy
With a copy to: Kirkpatrick & Lockhart LLP
Miami Center - Suite 2000
201 South Biscayne Boulevard
Miami, Florida 33131
Attention: Clayton E. Parker, Esq.
6.1.2. Notices may also be given in any other manner permitted by
law, effective upon actual receipt. Any party may change the address to which
notices, requests, demands or other communications to such party shall be
delivered or mailed by giving notice thereof to the other parties hereto in the
manner provided herein.
6.2. SURVIVAL. The representations, warranties, agreements and
indemnifications of the parties contained in this Agreement or in any writing
delivered pursuant to the provisions of this Agreement shall survive any
investigation heretofore or hereafter made by the parties and the consummation
of the transactions contemplated herein and shall continue in full force and
effect and survive after the Closing.
6.3. COUNTERPARTS; INTERPRETATION. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, and all of
which shall constitute one instrument. This Agreement supersedes all prior
discussions and agreements between the parties with respect to the subject
matter hereof, and this Agreement contains the sole and entire agreement among
the parties with respect to the matters covered hereby. All Exhibits hereto
shall be deemed a part of this Agreement. This Agreement shall not be altered or
amended except by a written instrument signed by or on behalf of all of the
parties hereto. No ambiguity in any provision hereof shall be construed against
a party by reason of the fact it was drafted by such party or its counsel.
6.4. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of South Carolina. The parties hereto
agree that any claim, suit, action or proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby shall be submitted for
adjudication exclusively in __________, South Carolina and each party hereto
expressly agrees to be bound by such selection of jurisdiction and venue for
purposes of such adjudication. Each party (a) waives any objection which it may
have that such court is not a convenient forum for any such adjudication, (b)
agrees and consents to the personal jurisdiction of such court with respect to
any claim or dispute arising out of or relating to this Agreement or the
transactions contemplated hereby and (c) agrees that process issued out of such
court or in accordance with the rules of practice of such court shall be
properly served if served personally or served by certified mail or other form
of substituted service, as provided under the rules of practice of such court.
6.5. ACCEPTANCE BY FAX. This Agreement shall be accepted, effective and
binding, for all purposes, when the parties shall have signed and transmitted to
each other, by telecopier or otherwise, copies of the signature pages hereto.
6.6. ATTORNEYS' FEES. In the event of any litigation or other proceeding
arising out of or in connection with this Agreement, the prevailing party or
parties shall be entitled to recover its or their reasonable attorneys' fees and
court costs from the other party or parties, including, without limitation, fees
and costs incurred in collecting any judgments or in connection with any appeal.
IN WITNESS WHEREOF, the parties have executed this Asset Purchase
Agreement as of the date first above written.
PROJECT IV:
By: /s/ John W. Gandy
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Name: John W. Gandy
Title: PRESIDENT
THE CROWFLY TEAM:
/s/ William E. King III
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William E. King, III
/s/ M. Phillip Waggoner
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M. Phillip Waggoner
/s/ Robert A. Gillgrist
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Robert A. Gillgrist
EXHIBIT A
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DESCRIPTION OF THE ASSET
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