BESC/IMT Asset Purchase Agreement Exhibit 10.01
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is made and entered into as of this
8th day of January 2007, by and between Interactive Media Technologies, Inc., a
Florida corporation (the "Buyer"), and BestNet Communications Corp., a Nevada
corporation (the "Seller"). The parties have agreed as follows.
1. RECITALS
1.1 BUSINESS.
Seller, among other things, owns and operates a business that sells internet
telephone services to customers (the "Business"). Seller desires to sell to
Buyer and Buyer desires to purchase from Seller certain of Seller's assets used
primarily in or relating primarily to the Business (as described herein), and to
assume certain specified liabilities, under the terms and conditions hereinafter
set forth. Buyer owns and operates, through several wholly and partially owned
subsidiaries, a number of telephone service businesses and has expertise in
evaluating, acquiring and operating such businesses.
1.2 BUYER'S INQUIRIES.
Prior to entering into this Agreement, Buyer had full access to the personnel
and equipment of the Business and has satisfied itself as to the assets it
desires to acquire from Seller, the liabilities it wishes to assume, the
Seller's customer lists and the feasibility of converting the Seller's customers
to the Buyer's telephone operating systems and acquiring the goodwill
represented by such customers.
1.3 DEFINITIONS
(a) "Assets" shall mean all of the right, title and interest that the Seller
possesses and has the right to transfer in and to all of the following described
properties, assets and rights used or useful in connection with the Business as
the same shall exist on the Closing Date:
(i) all of the right, title and interest of Seller in and to all furniture,
fixtures and equipment listed on Schedule 1.3(a)(i) attached hereto;
(ii) all intangible assets other than accounts receivable primarily used in
or relating to the Business, wheresoever situated and whether or not
specifically referred to herein or in any instrument of conveyance delivered
pursuant hereto, and whether or not any of such assets have any value for
accounting purposes or are carried or reflected on or referred to in any of the
books or financial statements of Seller, excluding, however, any rights of
Seller under a certain License Agreement between the Seller and Softalk,
Inc.(the "Softalk License"), a copy of which is attached hereto as Exhibit
1.3(a)(ii), and any sums of money that Seller has deposited with suppliers or
other parties ("Deposits");
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
(iii) all of Seller's rights and interests in, to and under the Agent
Agreements listed and described on Schedule 1.3 (a)(iii)(A) attached hereto and
Lease Contracts listed and described on Schedule 1.3 (a)(iii)(B) attached
hereto,;
(iv) Customer Information History
(v) the Seller's telephone numbers and internet domain names listed on
Schedule 1.3(a)(iv) used in connection with the Business; and
(vi) all goodwill associated with the Business.
(b) "Assumed Liabilities" shall mean all obligations of Seller under the Agent
Agreements, and Lease Contracts that are validly assigned to Buyer, which arise
after or are to be performed on and after the Closing Date;
(c) "Customer Information History" shall mean the complete customer transaction
history, software developments, trade secrets, customer lists, marketing
materials, billing and collection records, and all other intangible personal
property rights of the Seller which primarily relate to the Business or the
Assets of the Business; excluding, however, any rights of Seller under the
Softalk License.
(e) "Close" or "Closing" shall mean the consummation of the transactions
contemplated hereby.
(f) "Switchover Date" shall mean January 31, 2007, at 11:59 p.m. After this
date, all revenues associated with the Business will accrue to the benefit of
the Buyer and Buyer will be responsible for all liabilities associated with the
Business.
(g) "Closing Date" shall mean February 15, 2007, at 10:00 a.m., or as otherwise
described herein or agreed to by the parties to this Agreement, at the offices
of Firetag, Stoss & Dowdell, P.C., 1747 East Morten Avenue, Suite 107, Phoenix,
Arizona 85020.
(h) "Contracts" shall mean all contracts, agreements, understandings,
indentures, notes, bonds, loans, instruments, leases, subleases, mortgages,
franchises, licenses, commitments or binding arrangements, express or implied,
oral or written, whether or not enforceable, that are related exclusively to the
Business; excluding, however, the Seller's rights or interest under the Softalk
License.
(i) "Purchase Price" shall have the meaning set forth in Section 2.3, below.
(j) "Tax" shall mean any federal, state, local or foreign income, gross receipt,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental, custom duties, capital stock, franchise,
profits, withholding, social security (or similar), unemployment, disability,
real property, personal property, sales, use, transfer, registration, value
added, alternative or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition thereto, whether
disputed or not.
(k) "Tax Return" shall mean any return, declaration, report, claim for refund,
information return or statement relating to taxes, including any schedule or
attachment thereto, and including any amendment thereof.
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
2. PURCHASE AND SALE; ASSUMPTION OF LIABILITIES
2.1 PURCHASED ASSETS.
Seller agrees to sell, assign, transfer and deliver to Buyer, and Buyer agrees
to purchase from Seller, on the Closing Date (as defined in section 4 hereof),
all of the right, title and interest of Seller in and to all of the Assets, as
defined above, free and clear of all security interests, liens, claims and other
encumbrances. The Assets are being sold on an "AS IS; WHERE IS" basis. EXCEPT AS
OTHERWISE SPECIFICALLY STATED IN THIS AGREEMENT, SELLER MAKES NO REPRESENTATIONS
OR WARRANTIES WHATSOEVER WITH RESPECT TO ANY OF THE ASSETS. All tangible Assets
are being sold f.o.b. present location.
2.2 ASSUMPTION OF LIABILITIES.
Buyer and Seller agree that Buyer shall not assume, nor shall Buyer in any way
be responsible for, any liability, obligation, claim or commitment, contingent,
actual or otherwise, known or unknown, of Seller, it being expressly understood
and agreed that Seller shall continue to be responsible for any and all
liabilities, obligations, claims or commitments of Seller or the Business
entered into on or prior to the Closing Date, including but not limited to, any
sales, income, payroll or other taxes, obligations to other creditors including
vendors, employees and customers or other liabilities, obligations, claims or
commitments of the Seller incurred in connection with the transactions
contemplated hereby. Notwithstanding the preceding sentence, Buyer agrees that
it will, on the Closing Date, assume and agree to perform and discharge the
obligations of the Seller arising out of the agreements and contracts referred
to in Section 1.3(a)(iii)(B).
2.3 PURCHASE PRICE AND PAYMENT.
The purchase price (the "Purchase Price") for the Purchased Assets and Assumed
Liabilities shall be equal to the sum of Sixty Thousand Dollars ($60,000.00),
payable as follows:
(a) $30,000.00 in cash upon the mutual execution and delivery of this
Agreement; and
(b) $30,000.00 in cash upon the Closing Date.
On the Closing Date, Buyer also agrees to reimburse Seller for all expenses paid
by Seller after the Switchover Date through the Closing Date which relate to
liabilities associated with the Business that were incurred by Seller after the
Switchover Date.
Buyer further understands and agrees to pay any and all sales tax, use tax or
personal property tax due or to become due as a result of this transaction. The
parties shall agree on or prior to the Closing to allocate the Purchase Price
among the purchased Assets in accordance with section 1060 of the Internal
Revenue Code of 1986, as amended, and not to take any inconsistent position on
any tax return or filing.
2.4 FAMILIARIZATION PERIOD
A familiarization period ("Familiarization Period") shall commence forthwith
upon the mutual execution and delivery of this Agreement and expire on the
Switchover Date. During the Familiarization Period, the Buyer shall have full
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access to the facilities of the Seller for the purpose of facilitating the
seamless transfer of customers from the Seller's systems to the Buyer's systems.
2.5 CLOSING.
The Closing ("Closing" or "Closing Date") of the transactions contemplated
hereby shall take place at the office of Firetag, Stoss & Dowdell, P. C., 1740
East Morten, Suite 107, Phoenix, Arizona 85020 at 10 a.m. on the 15th day of
February, 2007, or at such other place, time or date, no later than forty-five
days after commencement of the Familiarization Period, as shall be mutually
agreed upon by Seller and Buyer.
2.6 DELIVERIES AT CLOSING
At the Closing,
(a) Seller shall deliver to Buyer the following:
(i) such bill of sale or other good and sufficient instruments of
assignment, transfer and conveyance as Buyer shall reasonably request, to
transfer to Buyer all right, title and interest of Seller in the Assets, free
and clear of all security interests, liens, claims and encumbrances;
(ii) all appropriate instruments granting to Buyer the right to the use of
all trade names and trademarks owned or used by Seller in connection with the
Business;
(iii) such other instrument or instruments of transfer, if any, as shall be
necessary or appropriate to vest in the Buyer good and marketable title to the
Assets;
(iv) delivery of any required consents; and
(v) delivery of all UCC-3 termination statements and all other documents
and instruments necessary to release and discharge all liens, claims, security
interests and other encumbrances on all Assets.
(b) Buyer shall deliver to Seller the following:
(i) the cash payment of $30,000 due on the Closing Date; and
(ii) any reimbursement of expenses due to Seller pursuant to Section 2.3.
2.7 ALLOCATION OF RECEIVABLES UPON CLOSING.
The parties will in good faith agree upon and put into effect procedures to
allocate all receivables generated from an after 12:01 AM on the Closing Date
(the "Transition Time") to the Buyer and to permit the Seller to have sufficient
access to the facilities of the Business for a reasonable period of time after
the Closing to enable it to collect receivables generated before the Transition
Time. It is understood that during that period, the Buyer will institute
procedures to enable it to collect receivables generated after the Transition
Time. The process is defined as follows:
1. On the Switchover Date, a report will be prepared by Seller to
determine the prepaid balances on all of its customer accounts.
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2. Seller will issue a check to Buyer for all the prepaid accounts and
Buyer will ensure that all prepaid balances are correctly applied to
the respective customer accounts maintained by Buyer.
3. Seller will obtain a list of open but sold virtual prepaid cards still
available with its agents.
4. Buyer will be responsible for any chargebacks related to the prepaid
account balances transferred.
5. Seller will collect all of its receivables via invoicing or its credit
card collection. None of Seller's receivables will be transferred to
the Buyer.
6. The database server and credit processing servers will remain active
and in Seller's control until the Closing Date to allow Seller to
collect all of its open receivables.
7. All the non-prepaid customers transferred to Buyer will not have any
beginning balances.
8. Seller will retain its merchant accounts and close them appropriately
with their credit card processor.
9. Seller will be responsible for any future chargebacks related to its
account receivable collection.
2.8 EMPLOYMENT.
Buyer agrees to continue the employment at Seller's Grand Rapids office of the
persons listed in Schedule 2.8 hereto (the "Grand Rapids Personnel") for a
minimum period of two months following the Switchover Date at the rate of
compensation shown therein. The services of the contractor personnel listed in
Schedule 2.8 other than the Grand Rapids Personnel (the "Canadian Personnel")
will not be terminated by the Seller prior to the Closing Date unless Buyer
notifies Seller prior to the Switchover Date that it does not desire the
services of the Canadian Personnel after the Closing Date. Buyer understands
that even if it so notifies Seller, it shall nevertheless be required to
reimburse Seller for the expenses of the Canadian Personnel from the Switchover
Date through the Closing Date. If not earlier terminated by the Seller, Buyer
agrees not to terminate the services of the Canadian Personnel without giving
such respective Canadian Personnel at least fifteen (15) days prior written
notice. It is understood and agreed that each of the Grand Rapids and Canadian
Personnel is intended to be a beneficiary of this Agreement, with the right to
bring an action for damages or otherwise as permitted by law and to recover, in
addition to any other damages, their reasonable legal fees and costs in
connection therewith.
2.9 USE OF GRAND RAPIDS PREMISES.
From the Closing Date until October 15, 2007, the Buyer may have the use of the
Seller's office facilities in Grand Rapids, Michigan, for keeping purchased
Assets located therein and for its customer service employees in the same manner
as Seller now uses the premises. It is understood that the Buyer will remove all
its purchased Assets and employees from these premises by October 15, 2007. It
is understood that the Seller's lease on said premises expires on October 31,
2007. The rental for such use shall be $700.00 per month, and a pro-rated amount
for fractional months, payable in advance on the first day of occupancy and on
the first day of each month thereafter.
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER.
Seller hereby represents and warrants to, and from and after this date,
covenants with, Buyer as follows:
3.1 ORGANIZATION AND AUTHORITY.
Seller is a corporation, duly organized, validly existing, and in good standing
under the laws of the State of Nevada and has all requisite corporate power and
authority to carry on its business as it is presently being conducted, to enter
into this Agreement, and to carry out and perform the transactions contemplated
hereby. The execution, delivery and performance of this Agreement by Seller has
been duly authorized and approved by its Board of Directors, and will not
violate its Articles of Incorporation, By-Laws, or any agreement to which it is
a party or by which it is bound or any law, rule, regulation or court order.
This Agreement, and all other instruments, documents and agreements to be
delivered by Seller in connection therewith, are the legal, valid and binding
obligation of Seller enforceable in accordance with its, and their, terms.
3.2 TITLE.
Seller has good and marketable title to all of the Assets, free and clear of any
liabilities, obligations, claims, security interest, liens or encumbrances.
3.3 NO MATERIAL ADVERSE CHANGE.
Since November 30, 2006, there has been (i) no material adverse change in the
Business, or its financial condition or prospects except as noted in Schedule
3.3 attached hereto, and (ii) no material damage, destruction, loss or claim,
whether or not covered by insurance, or condemnation or other taking adversely
affecting in any material respect the Assets. Since November 30, 2006 the Seller
has conducted its business only in the ordinary course and in conformity with
past practice.
3.4 TAXES.
Seller has timely filed all required federal, state, county and local income,
excise, withholding, property, sales, use, franchise and other tax returns,
declarations and reports which are required to be filed on or before the date
hereof and has paid or reserved for all taxes which have become due pursuant to
such returns or pursuant to any assessment which has become payable except for
taxes which it has contested in good faith.
3.5 LITIGATION.
Except as disclosed in the Seller's Annual Report on Form 10KSB for the fiscal
year ended August 31, 2006, as filed with the Securities and Exchange
Commission, there is no litigation or proceeding or governmental investigation
pending or, to the knowledge of Seller, threatened against Seller or relating to
the Assets or the Business.
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
3.6 COMPLIANCE WITH LAWS.
Since November 30, 2006, Seller has complied in all material respects with all
federal, state and local laws, statutes, rules, regulations, ordinances and
codes, and has received no written notice from any governmental agency asserting
that a violation has or may have occurred.
3.7 NO DEFAULTS.
All leases, agreements and other contracts constituting the Assumed Liabilities
are in full force and effect, with no default or breach existing or which would
occur but for the existence of notice or the lapse of time.
3.8 EQUIPMENT.
Each item of tangible equipment comprising the Assets is in working order and
repair, ordinary wear and tear excepted.
3.9 COMPLETENESS OF ASSETS.
Except for the rights of the Seller under the Softalk License and the Deposits,
the Assets being transferred hereunder comprise all of the assets which are
necessary to conduct the Business in the manner that it has been previously
conducted.
3.10 SELLER'S COVENANT NOT TO COMPETE
Seller, and its affiliates, shall not, individually or as a consultant,
shareholder, partner, venturer, director, officer, agent or otherwise, engage in
any of the following actions:
(i) for a three (3) year period following the Closing, solicit, call on or
contact any past (within the past 12 months) or present customers, suppliers or
employees of Seller with respect to the Business; or
(ii) for a two (2) year period following the Closing, engage in any
activity competitive with the Business as now conducted anywhere in the world.
In addition, Seller shall keep and maintain all confidential and proprietary
information of Seller, including without limitation, financial statements,
customer and supplier lists, pricing information, sales and purchases margins
and practices, methods of telephone solicitation and similar information
regarding the Business confidential and shall not disclose such information to
any third person or exploit such information personally except as required under
law, or if such information is in the public domain.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF BUYER
Buyer hereby represents and warrants, and from and after this date covenants to
Buyer as follows:
4.1 ORGANIZATION AND AUTHORITY.
Buyer is a corporation, duly organized, validly existing, and in good standing
under the laws of the State of Florida and has all requisite corporate power and
authority to carry on its business as it is presently being conducted, to enter
into this Agreement, and to carry out and perform the transactions contemplated
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
hereby. The execution, delivery and performance of this Agreement by Buyer has
been duly authorized and approved by its Board of Directors, and will not
violate its Articles of Incorporation, By-Laws, or any agreement to which it is
a party or by which it is bound or any law, rule, regulation or court order.
This Agreement, and all other instruments, documents and agreements to be
delivered by Buyer in connection therewith, are the legal, valid and binding
obligation of Buyer enforceable in accordance with its, and their, terms.
4.2 RECEIPT OF INFORMATION.
Buyer acknowledges that it has received a copy of the Seller's Annual Report on
Form 10-KSB as filed with the Securities and Exchange Commission for the fiscal
year ended November 30, 2006 and that Seller has heretofore afforded to the
officers, employees and authorized representatives (including, without
limitation, independent public accountants and attorneys) of the Buyer a full
and complete opportunity to conduct and complete its acquisition review and
analysis of the Assets and Assumed Liabilities, including a review of Seller's
books and records, financial information, contracts and agreements (including
all non-competition and non-solicitation covenants binding on Seller or its
employees) pertaining to the Business, inspection and review of the physical
operations of the Business, and the right to contact and communicate with
Seller's vendors, creditors, customers, employees, independent contractors and
others having a business relationship with Seller. Buyer agrees that it will
keep and maintain any and all information obtained by it, its agents, and
counsel, confidential, and will not make use of any such information other than
for its evaluation of this transaction.
5. CONDITIONS TO THE OBLIGATIONS OF THE SELLER
The obligations of the Seller under this Agreement shall be subject to the
satisfaction, on or prior to the Closing Date, of the conditions set forth
below.
5.1 NO MISREPRESENTATION OR BREACH OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
There shall have been no breach by Buyer in the performance of any of its
covenants and agreements herein; each of the representations and warranties of
Buyer contained or referred to herein shall be true and correct in all material
respects on the Closing Date as though made on the Closing Date, except for
changes therein specifically permitted by this Agreement or resulting from any
transaction expressly consented to in writing by the Seller; and there shall
have been delivered to the Seller a certificate or certificates to that effect,
dated the Closing Date, signed by the Buyer, by its President.
5.2 CORPORATE ACTION.
Buyer shall have taken all corporate action necessary to approve the
transactions contemplated by this Agreement, and Buyer shall have furnished the
Seller with certified copies of the resolutions adopted by the Board of
Directors and the Sole Shareholder of Buyer, in form and substance reasonably
satisfactory to counsel for the Seller, in connection with such transactions.
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BESC/IMT Asset Purchase Agreement Exhibit 10.01
5.3 NO RESTRAINT OR LITIGATION.
No action, suit, investigation or proceeding shall have been instituted or
threatened by any third party, governmental or regulatory agency to restrain,
prohibit or otherwise challenge the legality or validity of the transactions
contemplated hereby.
5.4 OTHER DOCUMENTATION AND PERFORMANCE.
Seller shall have received all of the documents and payments required to be
delivered by the Buyer at or before the Closing pursuant to this Agreement.
6. CONDITIONS TO THE OBLIGATIONS OF BUYER
The obligations of the Buyer under this Agreement shall be subject to the
satisfaction, on or prior to the Closing Date, of the conditions set forth
below.
6.1 NO MISREPRESENTATION OR BREACH OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
There shall have been no breach by Seller in the performance of any of its
covenants and agreements herein; each of the representations and warranties of
Seller contained or referred to herein shall be true and correct in all material
respects on the Closing Date as though made on the Closing Date, except for
changes therein specifically permitted by this Agreement or resulting from any
transaction expressly consented to in writing by the Buyer; and there shall have
been delivered to the Buyer a certificate or certificates to that effect, dated
the Closing Date, signed by the Seller, by its President.
6.2 CORPORATE ACTION.
Seller shall have taken all corporate action necessary to approve the
transactions contemplated by this Agreement, and Seller shall have furnished the
Buyer with certified copies of the resolutions adopted by the Board of
Directors, in form and substance reasonably satisfactory to counsel for the
Buyer, in connection with such transactions.
6.3 NO RESTRAINT OR LITIGATION.
No action, suit, investigation or proceeding shall have been instituted or
threatened by any third party, governmental or regulatory agency to restrain,
prohibit or otherwise challenge the legality or validity of the transactions
contemplated hereby.
6.4 OTHER DOCUMENTATION.
Buyer shall have received all of the documents and showings required to be
delivered by the Seller at the Closing
pursuant to this Agreement.
6.5 MUTUAL INDEMNIFICATION.
A. Seller hereby agrees to indemnify and hold the Buyer, and its shareholders,
directors, officers, employees and agents, harmless from and against any and all
claims, suits, actions, judgments, liability, losses, damages, fines, penalties,
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costs and expenses, including without limitation, reasonable attorneys' fees and
costs arising out of or relating to any event, condition, contract, obligation,
act, omission, non-fulfillment, non-Assumed Liability, breach, inaccuracy or
non-fulfillment of any representation, warranty, covenant or agreement with
respect to any of the terms of this Agreement. Seller acknowledges and agrees
that Buyer may withhold from and offset any payments due under the provisions of
this Agreement by the amount due Buyer under this section.
B. Buyer hereby agrees to indemnify and hold harmless the Seller, and its
shareholders, directors, officers, employees and agents, from and against any
and all claims, suits, actions, judgments, liability, losses, damages, fines,
penalties, costs and expenses, including without limitation, reasonable
attorneys' fees and costs arising out of or relating to any event, condition,
contract, obligation, act, omission, non-fulfillment, Assumed Liability, breach
or misrepresentation of warranty, representation, covenant or agreement with
respect to any of the terms of this Agreement.
7. GENERAL AND MISCELLANEOUS
7.1 NOTICES.
All notices for which provision is made in this Agreement shall be given in
writing either by actual delivery of the notice into the hands of the party
entitled to the notice or by mailing the notice by registered or certified mail,
return receipt requested, in which case the notice shall be deemed to be given
on the date of its mailing, addressed as follows:
If to Seller: BestNet Communications Corp.
2850 Thornhills Ave SE, Suite 104
Grand Rapids, Michigan 49546
With a Copy to: Stephen T. Meadow, Esq.
Firetag, Stoss & Dowdell, P.C.
1747 E. Morten Avenue, Suite 107
Phoenix, AZ 85020
If to Buyer: Interactive Media Technologies, Inc.
7999 North Federal Highway, Suite 400
Boca Raton, Florida 33487
7.2 PARTIES.
The terms and provisions hereof shall inure to the benefit of and be binding
upon the undersigned and each of them and their respective successors and
assigns.
7.3 SEVERABILITY.
The invalidity or unenforceability of any of the provisions hereof shall not
affect the validity or enforceability of the remainder hereof.
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7.3 ENTIRE AGREEMENT.
This Agreement together with all of the Schedules and other documents referred
to herein constitutes the entire Agreement between the parties with reference to
the subject matter hereof and supersedes all prior agreements and
understandings, whether written or oral, regarding the subject matter hereof,
and may only be changed or modified in writing.
7.4 SURVIVAL PAST CLOSING.
All of the representations, warranties, covenants, agreements, terms and
provisions of this Agreement shall survive the Closing Date.
7.5 GOVERNING LAW.
This Agreement shall be governed by the laws of Arizona.
7.6 LIMITATION OF SELLER LIABILITY.
Seller shall have no liability to Buyer for a breach or default of any
representation or warranty in this Agreement or in any agreement delivered by
Seller pursuant to this Agreement unless the valid claims for all such breaches
and defaults ("Representation Claims"), collectively aggregate more than Ten
Thousand Dollars ($10,000). The maximum aggregate liability of Seller on account
of Representation Claims shall not exceed the Purchase Price ($60,000). No
present or future partner, director, officer, shareholder, employee, advisor,
agent, attorney or asset manager of or in Seller shall have any personal
liability, directly or indirectly, under or in connection with this Agreement or
any agreement made or entered into under or in connection with the provisions of
this Agreement, or any amendment or amendments to any of the foregoing made at
any time or times, heretofore or hereafter, and Buyer and its successors and
assigns and, without limitation, all other persons and entities, shall look
solely to Seller's assets for the payment of any claim or for any performance,
and Buyer hereby waives any and all such personal liability. The limitations on
liability contained in this Section 7.6 are in addition to, and not in
limitation of, any limitation on liability applicable to Seller provided in any
other provision of this Agreement or by law or by any other contract, agreement
or instrument.
7.7 ARBITRATION.
Any dispute or controversy arising out of or relating to this Agreement, any
document or instrument delivered pursuant to, in connection with, or
simultaneously with the Agreement, or any breach of this Agreement or any such
document or instrument ("Dispute") shall be subject to the negotiation and
arbitration provisions contained herein. Each party to a Dispute shall make
every reasonable effort to meet in person and confer for the purpose of
resolving the Dispute by good faith negotiation before resorting to any other
dispute resolution procedure or legal proceeding. If the parties do not reach
such resolution within a period of thirty (30) days, then, upon notice by any
party to the other parties (a "Dispute Notice"), the Dispute shall be finally
settled by arbitration by a single arbitrator qualified to consider the matter
in dispute. The parties shall attempt to agree on a qualified arbitrator to hear
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the Dispute, provided that if the parties cannot agree on such an arbitrator
within thirty (30) days of the Dispute Notice, the Dispute shall be filed with
and administered by the American Arbitration Association, Phoenix, Arizona
office ("AAA") and the AAA shall select a single arbitrator qualified to
consider the Dispute. The arbitration shall be held in Phoenix, Arizona,
governed by the Commercial Arbitration Rules, then obtaining, of the AAA,
conducted at an arbitration hearing that shall not exceed three (3) days unless
otherwise agreed by the parties. The arbitrator may grant injunctions or other
relief in such dispute or controversy and shall rule on all other evidentiary or
discovery issues or requests. The decision of the arbitrator shall be final,
conclusive and binding upon the parties to the arbitration; and any party shall
be entitled to cause judgment on the decision or award of the arbitrator to be
entered in any court of competent jurisdiction. The parties shall share equally
the costs of the arbitrator, but each party shall be responsible for its own
attorney fees and other related costs, fees and deposits, notwithstanding any
provision to the contrary by statute or the rules of the American Arbitration
Association.
7.8 CAPTIONS AND HEADINGS.
The captions and headings of this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
7.9 COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the
date and year first above written.
BestNet Communications Corp.
By: ______________________________ Its: ______________________________
Interactive Media Technologies, Inc.
By: ______________________________ Its: President