LABTAM COMMUNICATIONS PTY. LTD. (ACN 077 993 590)
("Vendor")
AND
CREATIVE SOFTWARE TECHNOLOGIES PTY. LTD. (SUBJECT TO DEED OF
COMPANY ARRANGEMENT))(ACN 058 917 089)
AND
WHITE PINE SOFTWARE INC.
("Purchaser")
AND
DAWSON NOY JOHNS and ANTHONY JAMES OXLEY
("the Directors")
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SALE OF ASSETS AGREEMENT
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Anne Hodgson & Co Lawyers
Suite D, 2 Wallace Avenue
Toorak Victoria 3142
Telephone 03 9826 8078
Facsimile 03 9827 0533
Our Ref: 98089
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SALE OF ASSETS AGREEMENT
THIS AGREEMENT is made as at the 6th day of July, One thousand nine hundred and
ninety-eight
BETWEEN:
LABTAM COMMUNICATIONS PTY. LTD. (ACN 077 993 590)
of 33 Malcolm Road Braeside Victoria Australia
("Vendor")
of the first part
AND
CREATIVE SOFTWARE TECHNOLOGIES PTY. LTD. (SUBJECT TO DEED OF COMPANY
ARRANGEMENT))(ACN 058 917 089) of 33 Malcolm Road Braeside Victoria
("CST")
of the second part
AND
WHITE PINE SOFTWARE INC. a Dellaware corporation having it's principal offices
at 542 Amherst Street Nashua New Hampshire 03063 United States of America
("Purchaser")
of the third part
AND
DAWSON NOY JOHNS of 45 Old Mornington Road Mt. Eliza and ANTHONY JAMES OXLEY of
101 Frankston Flinders Road Shoreham
("the Directors")
of the fourth part
WHEREAS
A. CST is a research and development company which has developed products
comprising computer hardware and software which enables amongst other
things multimedia conferencing via any internet protocol network or
internet based network. These products are known as and have been marketed
and sold under and using the Business Names (detailed in Clause 1) ("the
LC Products"). The elements comprising the LC Products were owned by
and/or licensed to CST. The existing LC Products are as detailed in
Schedule 1.
B. By Sale of Assets Agreement dated 20 March, 1998 (as varied by Variation
Agreement dated 20 May, 1998) (collectively the "CST Sale Agreement"),
copies of which are attached as Schedule 2) between CST and the Vendor,
the Vendor acquired the LC
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Products.
C. CST was placed in to administration on 26 March, 1998. On 20 May, 1998
entered in to a Deed of Company Arrangement ("the CST DCA") with it's
creditors which deed was varied by Variation Deed dated 2 July 1998
("collectively the CST DCA"). A copy of the CST DCA is attached as
Schedule 3. A copy of the Variation Deed of the CST DCA is attached as
Schedule 5.
D. The Vendor owns the assets detailed in Recital A Clause 1 and Schedule 1.
E. The Directors are the Directors of the Vendor and CST.
F. The Vendor has the right to sell the Assets and CST has agreed to confirm
issues in respect to the LC Products including the Vendor's right to sell
them to the Purchaser subject to the provisions of the Sale Agreement and
the CST DCA and has agreed to sell the Assets to the Purchaser on the
terms contained in this Agreement.
THE PARTIES AGREE AS FOLLOWS
1. CONSTRUCTION
In this Agreement:
(a) "Assets" means:
(i) the Business Names;
(ii) the Confidential Information;
(iii) the Goodwill;
(iv) the Improvements;
(v) the Intellectual Property;
(vi) the LC Products
(vii) the Patents and the Trade Marks
(viii) the Products
(ix) the rights and benefits of the Vendor
under the Software Licences; and
(xi) the Technical Information;
(b) "Business Day" means any day which is not Saturday, Sunday or a
public holiday;
(c) "Business Name" means and all business and trading names which are
or have been used by the Vendor including and
using the names "CollabOrator" "LiveEye"
"My-T-Meeting" "Phone@" "SET Manager" "Tryst" and
"Wiz" and variations of those names;
(d) "Charges" means the registered mortgage debenture charges
over CST and the Assets as detailed below:
1. ANZ CHARGE
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Chargor: Australia and New Zealand
Banking Group Limited
Chargee: CST
Dated: 9 July 1996
Registered Number 551794 at the ASC
Stamped to: $510,000.00.
Assigned to Labtam Pty. Ltd. On 7
November, 1997
2. BELGRAVIA CHARGE
Chargor: Belgravia Investments Pty. Ltd.
Chargee: CST
Dated: 26/7/1996
Registered Number 554409 at the ASC
Stamped to: $150,000.00
3. SOLUTION 6 CHARGE
Chargor: Solution 6 Holdings Limited
Chargee: CST
Dated: 10/9/96
Registered Number 559628 at the ASC
Stamped to: $100,000.00
Assigned to Labtam Pty. Ltd. On 7
November, 1997
4. NAB CHARGE
Chargor: National Australia Bank Limited
Chargee: CST
Dated: 7 November, 1997
Registered Number 618712 at the ASC
5. NAB CHARGE
Chargor: National Australia Bank Limited
Chargee: The Vendor
Dated: 22 May, 1998
To be registered at the ASC
(e) "Confidential Information" means:
(i) all trade secrets and all financial,
accounting, marketing and technical
information, customer and supplier lists,
ideas, concepts, know-how, technology,
operating procedures, processes and other
information belonging to, used by or
relating to the Assets and transactions and
affairs relevant to the Assets whether or
not it is in the public domain;
(ii) all notes and reports incorporating or
derived from information referred to in
paragraph (i); and
(iii) all copies of the information, notes and
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reports referred to in paragraphs (i) & (ii)
(f) "Encumbrance" includes any mortgage, charge, pledge, lien and
any other encumbrance.
(f) "Goodwill" means the goodwill in respect to the Assets and
includes:
(i) the Business Names;
(ii) the Vendor's customer list (comprising
details of existing and potential customers
of the Vendor in respect to the LC Products)
and the Vendor's supplier list in respect to
the LC Products;
(iii) all other intangible assets of the Vendor
relevant to the Assets;
(g) "Improvements" means any improvements, modifications or
alterations in or to the inventions which are the
subject of the Intellectual Property including the
Patents and the Trade Marks.
(h) "Intellectual
Property" means the intellectual property and proprietary
rights (whether registered or unregistered)
licensed or used or to be used or to be acquired
by the Purchaser in connection with the LC
Products and the Intellectual Property detailed in
Schedule 1 including the Patents, Trade Marks,
Confidential Information, Technical Information
Improvements and circuit layouts and source codes.
(i) "LC Products" means the products owned by and/or licensed to the
Vendor (being those detailed in Recital A and
Schedule 1) being the Assets sold by the Vendor to
the Purchaser hereunder.
(j) "Patents" means all present and future patents and
applications for patents, any patents granted from
such patent applications, and patents or patent
applications in respect of the Intellectual
Property (including without limitation the Patents
detailed in Schedule 1).
(k) "Products" means all computer software and hardware which
uses or incorporates any of the Intellectual
Property of the Vendor including the products
listed in Schedule 1 (including but not limited to
the LC Products) and includes any derivatives
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thereof.
(l) "Purchase Price" means the price to be paid by the Purchaser to the
Vendor for the Assets.
(m) "Settlement" means settlement under this Agreement at 12:00
noon on the Settlement Date or such other time as
the parties mutually agree;
(n) "Software
Licence" means all of the right title and interest of the
Vendor in all contracts, agreements, arrangements
and licences concerning the use by the Vendor of
computer software or products in connection with
the LC Products.
(n) "Settlement
Date" As at the 6th day of July, 1998;
(o) "Technical
Information" means all technical, scientific and business
information which is in the possession or control
of the Vendor in respect to the Intellectual
Property and which the Vendor shall transfer to
the Purchaser at Settlement.
(p) "Trade Marks" means all present (including registered and
unregistered trade marks) and future trade marks
and applications for trade marks, any trade marks
granted from such trade mark applications and
trade marks or trade mark applications in respect
to Improvements (including without limitation the
trade marks detailed in Schedule 1).
(q) "Warranties" means the warranties made by the Vendor to the
Purchaser pursuant to this Agreement including the
warranties in Clause 15 and Schedule 6.
(r) words importing the singular include the plural and vice versa;
(s) words importing any gender include the other genders;
(t) a reference to an individual or person includes a corporation,
partnership, joint venture, association, authority, trust or body
politic;
(u) a reference to a person includes the legal personal representatives
of that person;
(v) a reference to this or any other document includes the document as
varied or replaced, and notwithstanding any change in the identity
of the parties;
(w) if a word or phrase is defined, cognate words and phrases have
corresponding definitions;
(x) a recital, schedule, annexure or a description of the parties forms
part of this document.
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2. HEADS OF AGREEMENT/TERM SHEET
The Vendor and the Purchaser executed Heads of Agreement/Term Sheet dated
30 May, 1998.
3. DUE DILIGENCE
The Purchaser has carried out and completed its due diligence in respect
to the Vendor and the Assets and advised the Vendor that it wishes to
proceed with the transaction evidenced by this Agreement.
4. AGREEMENT TO SELL
4.1 The Vendor agrees to sell and the Purchaser agrees to purchase the Assets
and the Vendor agrees to transfer/assign to and the Purchaser agrees to
have assigned/transferred to it (or to enter in to new arrangements with
the other party) the Agreements (as detailed in Clause 4.4 and Schedule
1).
4.2 On Settlement the Assets shall be transferred to the Purchaser free from
any mortgage, charge, pledge or other encumbrance.
4.3 The Charge over the Assets in favour of Belgravia Investments Pty. Ltd
(formerly Belgravia Group Pty. Ltd.("Belgravia") has been released and the
relevant ASC Form 312 was lodged at the Australian Securities Commission
on 1 July 1998. The Vendor shall provide releases of the Charges (except
the Belgravia Charge) to the Purchaser at Settlement.
4.4 The Vendor shall provide all reasonable assistance to the Purchaser to
have any and all licenses software development agreements co-marketing
agreements and distribution agreements in respect to the Intellectual
Property and specifically the LC Products (including but not limited to
those agreements detailed in Schedule 1) transferred/assigned to (or new
documents entered in to by) the Purchaser (and/or nominee) on and from
Settlement.
5. PURCHASE PRICE
5.1 Purchase Price - Payment
The Purchaser shall pay the Purchase Price as detailed in this Clause 5:
(a) the sum of US$500,000.00 to be paid on the Settlement Date; and
(b) 900,000 shares of the common stock, par value $00.01 per share in
the Purchaser ("the White Pines Shares")(subject to Clause 5.3) to
be handed to the Vendor at Settlement
5.2 The Purchaser instructed the Vendor to put a proposal to the Administrator
and the creditors of CST. The proposal was put to and accepted by the
creditors of CST on 2 July 1998 and is embodied in the Variation Deed of
the CST DCA (a copy of which is attached as Schedule 5). The Purchaser
shall ensure that the Vendor is provided with the funds (to a maximum of
A$445,793.56) necessary to meet the payments to the CST creditors detailed
therein. The Purchaser shall not be responsible for payment of the
Administrator's fees and expenses.
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5.3 Escrow Arrangements
5.3.1 At Settlement, 450,000 of the White Pine Shares shall be handed to
the Purchaser absolutely.
5.3.2 At Settlement, 450,000 of the White Pine Shares shall be held upon
the terms detailed in the Escrow Agreement attached as Schedule 7
("the Escrow Agreement") by the Escrow Agent detailed in such
Agreement ("the Escrow Agent"). The Escrow Agreement shall provide
that 225,000 of the White Pine Shares shall be held by the Escrow
Agent for a period of six months and the other 225,000 White Pine
Shares shall be held by the Escrow Agent for a period of twelve
months as surety to the Purchaser for the accuracy of the warranties
provided by the Vendor and the Directors concerning clear title to
the Assets being provided to the Purchaser under this Agreement.
5.4 By their execution hereof the Vendor and CST hereby confirm that the
Vendor's obligations under the CST Sale Agreement (including it's
obligations to pay royalties to CST thereunder) shall terminate forthwith
upon Settlement. This shall be without prejudice to the Purchaser's
obligations to pay the amounts payable by the Purchaser under Clause 5.2.
5.5 CST by it's execution of this Agreement confirms that the Vendor has the
power to enter in to this Agreement and to give good and clear title to
the Assets to the Purchaser.
5.6 All amounts payable by the Purchaser under this Agreement shall be paid by
cheque or telegraphic transfer, to the Vendor or as the Vendor directs in
writing.
5.7 At Settlement:
5.7.1 the Purchaser shall hand to the Vendor the share scrip for 450,000
White Pine Shares; and
5.7.2 the Purchaser shall provide the Vendor with evidence that the share
scrip for the other 450,000 White Pine Shares has been deposited
with the Escrow Agent pursuant to the Escrow Agreement and Clause
5.3.; and
5.7.3 the Vendor shall provide the Purchaser with releases of the Charges
(except the Belgravia Charge) and relevant ASC Forms 312.
5.7.4 the Vendor shall deliver to the Purchaser a Stock Power in the form
of Annexure "A" duly executed by the Vendor.
6. TRANSFER OF PROPERTY AND RISK
6.1 Title and Property Pass on the Settlement Date
6.1.1 Subject to Clauses 5.1 and 5.3, title to and property in and all
risks associated with the Assets included in the sale under this
Agreement shall pass to the Purchaser on the Settlement Date.
6.1.2 To ensure that all the Vendor's right title and interest in the
Intellectual Property including the LC Products passes to the
Purchaser at Settlement, the Vendor and the Purchaser shall execute
the Intellectual Property Assignment Deed attached as Schedule 4.
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6.2 Risk Until Settlement
The Assets included in this sale shall remain at the Vendor's risk until
the Settlement Date.
7. BOOK DEBTS
7.1 Vendor's Entitlement
The Vendor is entitled to all debts owing to the Vendor as at the
Settlement Date.
7.2 Purchaser's Obligation
If any debtor of the Vendor pays the debt to the Purchaser, the Purchaser
agrees to pay the amount collected to the Vendor within seven (7) days,
subject to clearance of cheques through the Purchaser's bank.
8. VENDOR'S LIABILITIES
8.1 The Purchaser assumes no liability for the Vendor's debts and liabilities.
8.2 Vendor's Indemnity
The Vendor hereby indemnifies and shall keep indemnified the Purchaser
against all claims and proceedings, including legal costs which may be
incurred by the Purchaser, in connection with the Vendor's debts or
liabilities in respect of the Vendor's business other than those
contemplated under this Agreement.
9. DELIVERY TO PURCHASER ON THE SETTLEMENT DATE
On the Settlement Date, the Vendor will deliver or pay to the Purchaser;
(a) executed assignments, or transfers of any asset included in the
Assets where such asset requires a specifically executed document to
assign the asset;
(b) duly signed by the Vendor, the required form to notify the change of
ownership of the Vendor's registered business name (if any);
(c) the Vendor's customer list and records relating to the customers of
the Vendor;
(d) the Vendor's suppliers list
(e) all orders, correspondence and records relating to inquiries or
approaches made to the Vendor by prospective customers and relating
to concluded or pending negotiations for customer orders, so that
the Purchaser will receive at Settlement the benefit of pending
negotiations for customer orders;
(f) the Assets;
(g) the releases and ASC Forms 311 in respect to the Charges (except the
Belgravia Charge); and
(h) a CD Rom containing the source code for the Intellectual Property.
The parties acknowledge that the relevant CD Rom is held on behalf
of the Vendor by Foley Hoag & Eliot (US Attorneys for the Purchaser)
pursuant to an Undertaking dated 3 July, 1998.
11. TRANSITIONAL PROVISIONS
The Vendor shall, until Settlement, remain in possession of the Assets and
shall carry on business (so far as it is able to do) in the ordinary
course of business.
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12. BUSINESS NAMES
The Vendor uses but has not registered nor sought to register the Business
Names or any of them or any name including them. The Vendor acknowledges
that the Purchaser shall be entitled to use the Business Names and any
names including them, and the Vendor shall cease to use the Business Names
and any names including them as and from the Settlement Date.
13. POST SETTLEMENT
The Vendor shall use its best endeavours to assist the Purchaser in
retaining the goodwill and business of existing and potential customers of
the Vendor and in seeking to induce the same to source their future
requirements of the LC Products from the Purchaser.
14. EXCLUSION OF PRE-CONTRACTUAL AND OTHER REPRESENTATIONS
14.1 Entire Agreement
This Agreement constitutes the entire agreement between the Vendor and the
Purchaser relating to the sale of the Assets.
14.2 Earlier Agreements Supplanted
This Agreement supplants and supersedes any previous written or oral
negotiations or preliminary agreements between the parties in relation to
the matters contained in this Agreement, which are deemed to have ceased
to be legally effective from the date when the parties entered into this
Agreement.
15. VENDOR'S WARRANTIES
15.1 The Vendor warrants to the Purchaser as at the date hereof and at
Settlement that:
(a) The Vendor has full title, capacity and authority to enter into this
Agreement and to sell the Assets.
(b) The Vendor has not received:
(i) any notice, petition or order for winding up;
(ii) any notice or order for the appointment of a
receiver/liquidator or other controller or administrator.
(c) The Vendor is not aware of any unsatisfied judgments, orders or
writs of execution affecting the Assets sold under this Agreement.
(d) The Vendor has and will as at the Settlement Date, have absolute
title to the Assets sold under this Agreement.
15.2 The Vendor further warrants to the Purchaser the Warranties detailed in
Schedule 6.
15.3 The Directors jointly and severally provide the Warranties to the
Purchaser and confirm that the Warranties are true and correct.
16. INDEMNITIES
The Vendor CST the Directors and each of them hereby jointly and severally
indemnify and shall keep indemnified the Purchaser in respect to any and
all claims made by any third party in respect to the Assets and in respect
of any Warranty breached or not being true and correct. The Purchaser
shall first have recourse to the White Pine Shares held in escrow pursuant
to Clause 5.7 in respect to any damages to which it is entitled under
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this Indemnity.
17. SERVICE OF NOTICES
All notices that are required or authorised to be given under this
Agreement shall be in writing and may be served by sending express air
mail post, personal delivery or facsimile to the registered or business
office of the other party and shall be deemed to have been duly served in
the case of such postage on the third business day after the date upon
which the notice was properly addressed and so posted or in the case of
personal delivery upon actual delivery or in the case of facsimile when
the error-free correct answer back code is received by the sender.
18. GOVERNING LAW
This Agreement is governed and construed in accordance with the law of
Victoria Australia.
19. READING DOWN AND SEVERABILITY
19.1 If any provision of this Agreement is void or voidable or
unenforceable in accordance with its terms, but would not be void,
voidable, unenforceable or illegal if it were read down and, it is
capable of being read down, such provision shall be read down
accordingly.
19.2 If, notwithstanding Clause 19.2, a provision is still void,
voidable, unenforceable or illegal:
20.2.1 if the provision would not be void, voidable, unenforceable
or illegal if a word or words were omitted, that word or
those words are hereby severed; and
20.2.2 in any other case, the whole provision is hereby severed;
and the remainder of this Agreement shall be of full force
and effect.
20. COMPLIANCE WITH NOTICES ON BUSINESS DAY
If under the provisions of this Agreement or under any notice or demand
anything is required to be done on a day which is not a Business day, the
day or the last day for compliance is deemed to be the immediately
following Business day.
21. CO-OPERATION
The parties mutually covenant and agree that they will each do all acts
and things and execute all deeds and documents and other writings as shall
from time to time be reasonably required for the purposes of or to give
effect to this Agreement.
22. PAYMENT
The Parties shall bear their own costs of and incidental to the
negotiation, preparation execution and settlement of this Agreement, and
the Purchaser shall bear all stamp duties (if any) assessed in relation to
this Agreement and any associated documentation.
23. COUNTERPART EXECUTION
23.1 This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Any counterpart may be used
as proof of this Agreement.
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23.2 The parties hereby agree that any party may execute a counterpart of
this Agreement and a facsimile copy hereof may be treated as a
counterpart hereof. Any party which has provided a facsimile copy
executed counterpart hereof shall promptly remit the original
executed counterpart to the other party.
24. AUTHORIZED REPRESENTATIVE
Where this Agreement is executed by a party by their authorized
representative, that authorized representative by his execution of this
Agreement confirms that the relevant party has authorized him to execute
this Agreement and that he is duly authorized to do so. He further
acknowledges that the other parties to this Agreement will act in reliance
on this representation of authority to act.
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EXECUTED AS AN AGREEMENT
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THE COMMON SEAL of LABTAM [SEAL]
COMMUNICATIONS PTY LTD
(ACN 077 993 590) was
hereunto affixed in
accordance with its Articles of
Association by authority of a
resolution of its Board of
Directors in the presence of:
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/s/ Anthony Oxley /s/ Dawson Johns
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Signature of Director Signature of Director and/or Secretary
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ANTHONY OXLEY DAWSON JOHNS
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Name of Director Name of Director and/or Secretary
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THE COMMON SEAL CREATIVE [SEAL]
SOFTWARE TECHNOLOGIES PTY. LTD.
(SUBJECT TO DEED OF COMPANY
ARRANGEMENT)(ACN 058 917 089)
was hereunto affixed in
accordance with its Articles of
Association by authority of a
resolution of its Board of
Directors in the presence of:
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/s/ Anthony Oxley /s/ Dawson Johns
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Signature of Director Signature of Director and/or Secretary
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ANTHONY OXLEY DAWSON JOHNS
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Name of Director Name of Director and/or Secretary
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SIGNED by DAWSON NOY JOHNS and
ANTHONY JAMES OXLEY in the
presence of:
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/s/ Dawson Johns /s/ Elizabeth Anne Hodgson
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Signature of DAWSON NOY JOHNS Signature of Witness
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/s/ Anthony Oxley ELIZABETH ANNE HODGSON
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Signature of ANTHONY JAMES OXLEY Name of Witness
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SIGNED by WHITE PINE SOFTWARE
INC. by it's Authorized
Representative in the presence
of:
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/s/ Killko Caballero /s/ Jean-Paul Rottier
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Signature of KILLKO CABALLERO Signature of Witness
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JEAN-PAUL ROTTIER
--------------------------------
Title: President Name of Witness
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Schedules to the Sale of Assets Agreement
The following Schedules to the Sale of Assets Agreement are omitted pursuant
to Item 601(b)(2) of Regulation S-B promulgated by the Securities and
Exchange Commission. Copies of the Schedules will be provided to the
Securities and Exchange Commission upon request.
Schedule 1 - Assets
Schedule 2 - Sale of Assets Agreement dated as of March 20, 1998 between
Labtam Communications Pty. Ltd. and Creative Software
Technologies Pty. Ltd.
Schedule 3 - Deed of Company Arrangement dated May 20, 1998 between Creative
Software Technologies Pty. Ltd. and Graeme Lloyd Smith, as
Administrator
Schedule 4 - Form of Intellectual Property Assignment Deed between White Pine
Software, Inc. and Labtam Communications Pty. Ltd.
Schedule 5 - Deed Varying Deed of Company Arrangement dated July 3, 1998
between Creative Software Technologies Pty. Ltd. (subject to
Deed of Company Arrangement) and Graeme Lloyd Smith, as
Administrator
Schedule 6 - Warranties
Schedule 7 - Form of Escrow Agreement among White Pine Software, Inc., Labtam
Communications Pty. Ltd. and State Street Bank and Trust Company
Annexure A - Form of Stock Power