Exhibit 10.1

 

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of 8th September
2020, is by and between Bare Metal Standard Inc., an Idaho corporation
(“Seller”) and Code 96, LLC, a Nevada limited liability company or its assignee
(“Buyer”).

 

W I T N E S S E T H:

 

WHEREAS, Seller is engaged in the business of providing kitchen hood cleaning
services and franchising of its intellectual property to others engaged in such
business (the “Business”); and

 

WHEREAS, Seller has agreed to sell to Buyer, and Buyer has agreed to purchase
from Seller all of the assets of Seller that are used by Seller in the operation
of the Business on the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the premises and the representations,
warranties, covenants, agreements and undertakings contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, agree as
follows:

 

1.       Certain Definitions.

 

(a)   As used in this Agreement, the following terms have the meanings set forth
below:

 

“Assumed Liabilities” means any and all of the following that arise on or after
the Closing: (i) Liabilities of the Business set forth in Schedule 1.1(a) of the
Disclosure Schedules: (A) that arise under or relating to the Business
Instruments and other Sale Assets, and/or (B) that accrue, relate to or
otherwise arising out of the conduct or operation of the Business or the
ownership, leasing or use of the Sale Assets from and after the Closing, , (ii)
Liabilities related to the Sale Assets and the Business that arise out of events
occurring from and after the Closing Date, and (iii) all other Liabilities that
Buyer has expressly assumed or agreed to assume under this Agreement or any of
the Ancillary Documents.

 

“Business Day” means any day other than a Saturday, a Sunday or a day on which
banks in New York City are authorized or obligated by Law or executive order to
close.

 

“CPA Firm” means the Isler Group LLC (John Warner CPA) or such other firm of
independent certified public accountants on which Seller and Buyer shall agree.

  

“Encumbrance” means any mortgage, lien, charge, restriction, pledge, security
interest, option, lease or sublease, claim, right of any third party, easement,
encroachment or encumbrance or other charges or rights of others of any kind or
nature, except Permitted Encumbrances.

 

“GAAP” means United States generally accepted accounting principles.

 

  

 

 

“Government Entity” means the United States or any federal, state or local
court, administrative or regulatory body or other governmental or
quasi-governmental entity with competent jurisdiction.

 

“Law” means any law, statute, ordinance, rule, regulation, code, order,
judgment, injunction or decree enacted, issued, promulgated or entered by a
Government Entity.

 

“Liabilities” means any and all debts, costs, expenses, losses, liabilities,
commitments and obligations of any kind, whether fixed, contingent or absolute,
matured or unmatured, liquidated or unliquidated, accrued or not accrued,
asserted or not asserted, known or unknown, determined, determinable or
otherwise, however arising (including, whether arising out of any contract or
tort based on negligence or strict liability) and regardless of whether the same
would be required by GAAP to be reflected in financial statements or disclosed
in the notes thereto.

 

“Permitted Encumbrances” means (i) mechanics’, materialmen’s, warehousemen’s,
carriers’, workers’, or repairmen’s liens or other similar common law or
statutory encumbrances arising or incurred in the ordinary course of business
for amounts not yet due and payable; (ii) liens for taxes, assessments and other
governmental charges not yet due and payable or that are due but not delinquent;
(iii) with respect to real property, (A) easements, quasi-easements, licenses,
covenants, rights-of-way, rights of re-entry and other similar restrictions or
defects of title, (B) any conditions that may be shown by a current survey or
physical inspection, (C) zoning, building, subdivision and other similar
requirements and restrictions, (D) landlords’ liens for amount not yet due and
payable; (iv) rights reserved to any Government Entity to regulate the affected
property; (v) encumbrances that are Assumed Liabilities; (vi) encumbrances
incurred in the ordinary course of business in connection with workers’
compensation and unemployment insurance or similar Laws that are disclosed in
the documentation made available to Buyer before the date of this Agreement;
(vii) encumbrances granted to existing lenders that will be released at or prior
to Closing and (viii) encumbrances that would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
Business, materially adversely impair the current value, use or operation of the
Business, or otherwise materially interfere with the use of the affected
property in the operation of the Business.

 

“Permit” means a license, right, authority or other permission that a federal,
state or local government or agency granted to the Seller.

 

“Person” means an individual, corporation, partnership, association, limited
liability company, Government Entity, trust or other entity or organization.

 

“Receivables” means the right to receive payment for services provided to
customers.

 

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“Sale Assets” means all of the right, title and interest in and to all assets,
rights and properties that the Seller possesses, owns or uses in connection
with, or related to, the Business, including without limitation: (i) all UPS
systems, generators, mechanical infrastructure, data center equipment, racks,
cabinets, PDUs, networking equipment including routers and switches and other
tangible assets (including tangible assets supporting access systems, video
surveillance, DCIIM and monitoring systems) owned by Seller; (ii) the Lease and
rights thereunder; (iii) the Business Instruments other than the Lease; (iv)
indentures, mortgages, instruments, security interests, guaranties, other
similar arrangements, and rights thereunder; (v) Receivables; (vi) claims,
deposits, prepayments, refunds, causes of action, chooses in action, rights of
recovery, rights of set off, and rights of recoupment (including any such item
related to the payment of taxes); (vii) Permits and similar rights from
Governmental Entities; (viii) IP Transit Agreement providing 4 years of free
internet service]and (ix) books, records, ledgers, files, documents,
correspondence, lists, plats, architectural plans, drawings, and specifications,
studies, reports, and other printed or written materials; provided, however,
that the Sale Assets will not include (A) the governing instrument of the
limited liability company, qualifications to conduct business as a foreign
entity, arrangements with registered agents related to foreign qualifications,
taxpayer and other identification numbers, seals, minute books, stock transfer
books, blank stock certificates, and other documents relating to the
organization, maintenance and existence of Seller as a limited liability
company; or (B) the Excluded Assets.

 

“Transaction” means the transactions contemplated by this Agreement and the
Ancillary Documents.

 

(b)       Other Terms 

. Other terms may be defined elsewhere in the text of this Agreement and, unless
otherwise indicated, shall have such meaning throughout this Agreement.

 

(c)       Other Definitional Provisions. Unless the express context otherwise
requires:

 

(i)       the words “hereof,” “herein” and “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement;

 

(ii)       the terms defined in the singular have a comparable meaning when used
in the plural, and vice versa;

 

(iii)      the terms “Dollars” and “$” mean United States Dollars;

 

(iv)      references herein to a specific Section, Exhibit or Schedule shall
refer, respectively, to the applicable Section, Exhibit or Schedule of or to
this Agreement;

 

(v)      the words “include,” “includes” and “including” shall be deemed to be
followed by the words “without limitation”; and

 

(vi)     references herein to any gender includes each other gender.

 

2.       Purchase and Sale.

 

(a)        Sale Assets. On the terms and subject to the conditions set forth
herein, at the Closing, Seller shall sell, convey, transfer, assign and deliver
to Buyer, and Buyer shall purchase and acquire from Seller all of Seller’s
right, title and interest in and to the Sale Assets.

 

(b)       Excluded Assets. Notwithstanding anything herein to the contrary, from
and after the Closing Date, as applicable, Seller shall retain all of its
existing right, title and interest in and to, the following (collectively, the
“Excluded Assets”): (i) any and all rights accruing to Seller under this
Agreement and the transactions contemplated herein; and (ii) any and all
correspondence, memoranda, books of account and the like and other books and
records, in each case, that are not related to the Business or the Sale Assets
and all files and other books and records related to internal matters (including
Seller’s organizational and formation documents and minute books).

 

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3.       Assumption of Liabilities. On the terms and subject to the conditions
set forth in this Agreement, Buyer shall assume and become responsible for all
of the Assumed Liabilities at Closing. Buyer shall not assume or have any
responsibility, however, with respect to any obligation or Liability of Seller
not included within the definition of Assumed Liabilities.

 

4.       Payment of Purchase Price. The consideration for the sale of the Sale
Assets shall consist of an aggregate amount of cash equal to the Purchase Price
(as defined below) determined pursuant to Section 5 below (and as adjusted
pursuant to Section 6 below) and the assumption of the Assumed Liabilities. At
Closing, Buyer shall pay to Seller an amount equal to the Estimated Purchase
Price (as defined below) by wire transfer of immediately available funds to an
account designated in writing, at least three (3) Business Days before the
Closing, by Seller. All payments shall be paid to the trust account of Seller’s
attorney and disbursed to certain creditors of the Seller as instructed by
Seller’s present management.

 

5.       Closing; Closing Deliveries; Franchise Transfers and Management
Agreement.

 

(a) Closing. The consummation of the transactions contemplated by this Agreement
(the “Closing”) shall take place on the date of this Agreement (the “Closing
Date”). The Closing shall take place via fax, electronic mail and/or overnight
deliveries or as otherwise mutually determined by Seller and Buyer.

 

(b) Closing Deliveries. At Closing, (i) Seller and Buyer shall execute and
deliver (A) the bill of sale and Assignment and Assumption Agreement, along with
identified items in the Balance Sheet and federal COVID-19 loans to include (PPP
loan and EIDL from the SBA), in the form attached hereto as Exhibit A (the “Bill
of Sale”), (B) such other documents and instruments reasonably necessary for
Buyer to assume the Assumed Liabilities or as otherwise reasonably requested by
Seller in order to carry out the intent and purposes of this Agreement; and
(iii) Seller shall deliver to Buyer (A) the consents, authorizations and
approvals required under Section 7(b) of the Disclosure Schedules, (B) a
certificate of the [managers] of Seller certifying as to: (i) the
[organizational documents] of Seller; (ii) [resolutions of the board of
directors authorizing and approving the execution, delivery and performance by
Seller of this Agreement and any agreements, instruments, certificates or other
documents executed by each Seller pursuant to this Agreement, as well as the
incumbency and signatures of the managers of Seller]. The Bill of Sale together
with, Assignment and Assumption Agreement and any other documents and
instruments reasonably necessary for Buyer to assume the Assumed Liabilities,
for Seller to sell and transfer the Sale Assets or as otherwise reasonably
requested by the parties hereto in order to carry out the intent and purposes of
this Agreement shall hereinafter collectively be referred to as the “Ancillary
Documents”.

 

(c) New Business. It is anticipated that Seller will acquire a new business
simultaneously with the closing hereunder. The parties will use reasonable
efforts to coordinate the closing hereunder with Seller’s acquisition of the new
business so that there is no gap period in which Seller becomes a “shell
company.”

 

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6.        Allocation of Purchase Price. Buyer will prepare an allocation of the
Purchase Price among the assets purchased for tax purposes (the “Allocation
Schedule”). Buyer shall furnish Seller with the proposed Allocation Schedule
within thirty (30) days after the Closing. Seller shall have 10 days in which to
comment on the proposed Allocation Schedule. If the Buyer refuses any of
Seller’s comments on the Allocation Schedule, the Seller may request that the
Buyer and Seller employ the CPA Firm to determine whether Seller’s objections
should be accepted or rejected. Buyer and Sellers agree that the Allocation
Schedule shall be amended to reflect adjustments to the Purchase Price made
pursuant to this Agreement. Unless otherwise required by applicable Law, Buyer
and Sellers agree to act, and cause their respective Affiliates to act, in
accordance with the computations and allocations contained in the Allocation
Schedule in any relevant tax returns or similar filings (including any forms or
reports required to be filed pursuant to Section 1060 of the Internal Revenue
Code of 1986, as amended (the “1060 Documents”), to cooperate in the preparation
of any 1060 Documents, to timely file such 1060 Documents in the manner required
by applicable Law and to not take any position inconsistent with such Allocation
Schedule upon examination of any returns, in any litigation or otherwise.

 

7. Seller’s Representations and Warranties. Seller represents and warrants to
Buyer, as follows:

 

(a)        Seller is a corporation, duly organized, validly existing and in good
standing under the Laws of the State of Idaho and has all requisite limited
liability company power and authority to execute and deliver this Agreement and
the Ancillary Documents and consummate the transactions contemplated hereby and
thereby and the execution, delivery and performance of this Agreement and the
Ancillary Documents has been duly and validly authorized by all requisite
limited liability company action on behalf of Seller.

 

(b)        This Agreement and the Ancillary Documents are the legal, valid and
binding obligation of Seller, enforceable against Seller in accordance with
their respective terms, except insofar as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
now or hereafter in effect affecting creditors’ rights generally, or by
principles governing the availability of equitable remedies.

 

(c)        Except as otherwise expressly set forth in this Agreement and the
Ancillary Documents, Seller expressly disclaims any representations or
warranties of any kind or nature, express or implied (including as to the future
or historical financial condition, value or quality of the Business or the Sale
Assets, Assumed Liabilities or results of operations or to any environmental,
health or safety matters with respect to the Business), and Seller specifically
disclaims any representation or warranty of merchantability, usage, suitability
or fitness for any particular purpose of the Sale Assets and any part thereof.
Further, Seller hereby expressly disclaims any other representations or
warranties of any kind or nature, legal or contractual, express or implied,
notwithstanding the delivery or disclosure to Buyer or its officers, directors,
employees, members, managers, agents or representatives of any documentation or
other information (including any financial projections or other supplemental
data).

 

(d)        Seller has, or will have at Closing, good and transferable title to,
or a valid leasehold interest in, each and all of the Sale Assets, free and
clear of any Encumbrances other than Permitted Encumbrances. Except as set forth
in Section 9(d) of the Disclosure Schedules, the Sale Assets, [together with the
services provided to the Business under the Transition Services Agreement and
the assets of Seller used to provide such services], are sufficient for the
continued operation of the Business after Closing in substantially the same
manner as operated by Seller prior to Closing.

 

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(e)        Section  of the Disclosure Schedule lists all property leased or
subleased to or by the Company and lists the term of such lease, any extension
and expansion options, and the rent payable thereunder. The Company has
delivered or made available to the Buyer complete and accurate copies of the
leases and subleases listed in the Company Disclosure Schedule.

 

(f)        Environmental Matters. Except as set forth on Schedule 5.1, Seller
has no knowledge of any existing, pending or threatened violation of
Environmental Law concerning Business, or of any existing, pending or threatened
investigation by any federal, state, or local Governmental Authority or are
subject to any remedial obligation or lien under or in connection with any
Environmental Law.   Environmental Law means any federal, state or local law,
whether by common law, statute, ordinance, or regulation, pertaining to health,
industrial hygiene, or environmental conditions, including, without limitation,
the Comprehensive Environmental Response Compensation and Liability Act of 1980,
42 U.S.C. Section 9601, et seq. (“CERCLA”); the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic
Substances Control Act of 1976, 15 U.S.C. Section 2501, et seq. (“TSCA”); the
Superfund Amendments and Reauthorization Act of 1986, Title III, 42 U.S.C.
Section 11001, et seq. (“SARA”); the Clean Air Act, 42 U.S.C. Section 7401, et
seq.; the Federal Water Pollution Control Act, 33 U.S.C. Section 1251, et seq.;
the Solid Waste Disposal Act, 42 U.S.C. Section 3251, et seq.; the Hazardous
Materials Transportation Act, 49 U.S.C. § 1901, et seq.; the Safe Drinking Water
Act, 42 U.S.C. Section 300h et seq.; the Clean Water Act, 33 U.S.C. Section 1251
et seq.;, all as now or hereafter amended, supplemented or replaced from time to
time

 

(g)        LITIGATION. There is no Legal Proceeding pending or threatened
against the Seller (or pending or threatened against any owners, directors,
officers or employees of the Seller with respect to their business activities on
behalf of the Seller), or to which the Seller is otherwise a party, before any
Governmental Authority; nor is there any reasonable basis for any such Legal
Proceeding. The Seller is not subject to any Order with respect to the Business.
There are no Legal Proceedings pending or threatened that are reasonably likely
to prohibit or restrain the ability of the Seller to perform its obligations
under this Agreement or consummate the transactions contemplated hereby.

 

(h)        EMPLOYMENT. To the Knowledge of Seller, with respect to current and
former employees and other service providers of the Seller related to the
Business (each a “Service Provider”):

 

(i)       the Seller is and has been in compliance in all material respects with
all applicable Laws respecting employment and employment practices, terms and
conditions of employment and wages and hours, including any Laws respecting
minimum wage and overtime payments, employment discrimination, workers’
compensation, family and medical leave, immigration, and occupational safety and
health requirements, and has not and is not engaged in any unfair labor
practice;

 

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(ii)       each Service Provider classified by the Seller as an independent
contractor satisfies and has satisfied the requirements of any applicable Law to
be so classified, and the Seller has fully and accurately reported such
independent contractors’ compensation on IRS Forms 1099 when required to do so;
and

 

(iii)       the Seller is not delinquent to, and has not failed to pay when due,
any Service Provider for any wages (including overtime, meal breaks or waiting
time penalties), salaries, commissions, accrued and unused vacation, on-call
payments or equal pay, or collective bargaining payments to which they would be
entitled under applicable Law, if any, bonuses, benefits, advantage in kind,
profit sharing, stock options or other compensation for any services performed
by them or amounts required to be reimbursed or damages or interest paid to such
individuals (other than accrued salary, bonuses, commissions, vacation, or other
paid time off in accordance with the Seller’s policies); and

 

(iv)       the Seller does not have any liability for any payment to any trust
or other fund governed by or maintained by or on behalf of any Governmental
Authority with respect to unemployment compensation benefits, social security or
other benefits or obligations for Service Providers (other than routine payments
to be made in the normal course of business and consistent with past practice).

 

(v)       There are no demands or claims pending or, to the Seller’s Knowledge,
threatened, before any Governmental Authority by any employees for compensation,
pending severance benefits, vacation time, unpaid meal or rest breaks, vacation
pay, maternity benefits, any statutory benefits, or any other claim threatened
or pending before any Governmental Authority (or any state “referral agency”)
from any employee or any other Person arising out of the Seller’s status as
employer or joint employer, whether in the form of claims for employment
discrimination, harassment, retaliation, unfair labor practices, grievances,
wrongful discharge or variation of contract, wage and hour violations, breach of
contract, unfair business practice, tort, unfair competition or otherwise. In
addition, there are no pending or threatened claims or actions against the
Seller under any workers compensation policy or long-term disability policy, nor
to the Seller’s Knowledge is there any reasonable basis therefor.

 

(i)       GOOD WORKING ORDER. All of the Sale Assets are in good working order,
reasonable wear and tear excluded. Seller has not engaged in deferred
maintenance of the Sale Assets. All of the Sale Assets have been properly
maintained to function as part of a data center. The Sale Assets together are
necessary and sufficient to operate a data center in compliance with applicable
laws. The Seller has disclosed its capital expenditure budget.

 

(j)        CUSTOMERS. Except as set forth on the Company Disclosure Schedule ,
the Seller has no information which might reasonably indicate that any of its
customers listed on the Disclosure Schedule intend to cease purchasing from,
selling to or dealing with the Seller or the Business, nor has any information
been brought to the Seller’s attention which might reasonably lead the Seller to
believe any such customer intends to alter in any material respect the amount of
such purchases or sales or the extent of dealings with the Business or would
alter in any material respect such purchases, sales or dealings in the event of
the consummation of the transactions contemplated by this Agreement. Except as
set forth on Disclosure Schedule 3.9, the Seller has no information which might
reasonably indicate, nor has any information been brought to the Seller’s
attention which might reasonably lead the Seller to believe that Seller has
billed any customer incorrectly.

 

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(k)        TAXES. The Seller has filed all federal, state, and local tax returns
and other reports required by law to be filed prior to the date of this
Agreement and has paid or caused to be paid all taxes (including any interest or
penalties associated therewith), assessments, and other governmental charges
that are due and payable as of the date of this Agreement, and has made adequate
provision for the payment of such taxes, assessments, and other charges accruing
but not yet payable, and Seller does not know or have reasonable grounds to know
of any deficiency or additional assessment against the Seller in connection with
any taxes, assessments or charges. There is no pending audit or investigation of
the Seller by any governmental tax authority.

 

10.       Buyer’s Representations and Warranties. Buyer represents and warrants
to Seller, as follows:

 

(a)       Buyer is a limited liability company, duly organized, validly existing
and in good standing under the Laws of the State of Nevada and has all requisite
limited liability company power and authority to execute and deliver this
Agreement and the Ancillary Documents and consummate the transactions
contemplated hereby and thereby and the execution, delivery and performance of
this Agreement and the Ancillary Documents has been duly and validly authorized
by all limited liability company action on behalf of Buyer. Buyer is duly
qualified to do business and is in good standing in the state or states in which
the Sale Assets are located.

 

(b)       This Agreement and the Ancillary Documents are the legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance with their
respective terms, except insofar as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect affecting creditors’ rights generally, or by principles
governing the availability of equitable remedies.

 

(c)       Except as otherwise expressly set forth in this Agreement and the
Ancillary Documents, Seller expressly disclaims any representations or
warranties of any kind or nature, express or implied (including as to the future
or historical financial condition, value or quality of the Business or the Sale
Assets, Assumed Liabilities or results of operations or to any environmental,
health or safety matters with respect to the Business), and Seller specifically
disclaims any representation or warranty of merchantability, usage, suitability
or fitness for any particular purpose of the Sale Assets and any part thereof.
Further, Seller hereby expressly disclaims any other representations or
warranties of any kind or nature, legal or contractual, express or implied,
notwithstanding the delivery or disclosure to Buyer or its officers, directors,
employees, members, managers, agents or representatives of any documentation or
other information (including any financial projections or other supplemental
data).

 

(d)       Seller has, or will have at Closing, good and transferable title to,
or a valid leasehold interest in, each and all of the Sale Assets, free and
clear of any Encumbrances other than Permitted Encumbrances. Except as set forth
in Section 9(d) of the Disclosure Schedules, the Sale Assets, [together with the
services provided to the Business under the Transition Services Agreement and
the assets of Seller used to provide such services], are sufficient for the
continued operation of the Business after Closing in substantially the same
manner as operated by Seller prior to Closing.

 

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11.       Covenants and Agreements.

 

(a)        Sale Assets. Except for the Excluded Assets, Seller acknowledges and
agrees that Buyer is purchasing the Sale Assets with the understanding that the
Sale Assets comprise all of assets used by Seller (including rights under
contracts, permits, franchises, authorizations, licenses and other instruments
and agreements) that may be necessary to operate the Business or own the Sale
Assets as operated by Seller

 

(b)        No Other Representations or Warranties; As-is, Where-Is Purchase.

 

(i)       In connection with Buyer’s investigation of the Sale Assets and the
Business, Buyer may have received and may hereafter receive from the Seller or
any of its directors, officers, employees, managers, members, partners,
affiliates, agents or representatives projections, forecasts, estimates, plans
or budgets of future revenues, expenses or expenditures, future results of
operations (or any component thereof), future cash flows (or any component
thereof) or future financial condition (or any component thereof) relating to
the Business (collectively, “Projections”). Buyer is not relying upon the
Projections and Buyer acknowledges that there are uncertainties inherent in
attempting to make Projections, subject to the understanding that such
Projections were prepared on the basis of reasonable assumptions underlying such
Projections.

 

(ii)       except as set forth herein and subject to the terms hereof, Buyer
ACKNOWLEDGES AND agrees that Seller is transferring the Sale Assets to Buyer,
and Buyer is purchasing the Sale Assets from Seller, AS IS and WHERE IS and with
all faults and without any representations or warranties of any kind, whether
express or implied, at law or in equity.

 

(c)       Customer Information. Buyer acknowledges that information regarding
customers (“Customer Information”) may be exchanged among the parties and] may
be subject to legal restrictions on use or disclosure, including Laws relating
to customer proprietary network information. [Buyer may only obtain and use
Customer Information in accordance with any applicable Law. Buyer agrees to use
Customer Information only for the purposes for which it was disclosed and not to
further use or disseminate or disclose Customer Information to other third
parties, except in compliance with applicable Law. As requested by Seller, Buyer
will cooperate to provide any customer notification and/or obtain any customer
consents relating to Customer Information required in accordance any applicable
Law. Buyer shall use all Customer Information obtained from Seller in connection
with this Transaction in compliance with all Laws governing the use, collection,
disclosure and storage of such information.

 

(d)        Use of Seller’s Names. Buyer acknowledges and agrees that Seller’s
and its affiliates’ names and trademarks, and any derivations thereof, are
Excluded Assets, and Buyer shall not be permitted to use such names and
trademarks, or any derivations thereof and Buyer shall remove or delete any such
names, trademarks and derivations thereof from the Sale Assets and the Raymond
Facility as soon as reasonably practicable, and in any event within ten (10)
days, following the Closing Date.

 

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(e)        Accounts Receivable. If, after the Closing, Buyer receives or
collects any accounts receivable of Business that is an Excluded Asset, the
Buyer shall promptly (and in any event no later than five (5) Business Days
after receipt of such accounts receivable) remit, or shall cause to be remitted,
such amount received or collected to Seller. If, after the Closing, Seller
receives or collects any accounts receivable of Business that is a Sale Asset,
Seller shall promptly (and in any event no later than five (5) Business Days
after receipt of such accounts receivable) remit, or shall cause to be remitted,
such amount received or collected to Buyer.

 

(f)        Affiliated Services. 

Buyer acknowledges and agrees that (a) the services provided for the Business by
Seller and its affiliates and certain third parties, including customary
corporate overhead, billing, technical operations and customer care services
shall cease to be provided to the Business effective as of the Closing Date and
(b) after the Closing Date, Seller and its affiliates and third parties, as
applicable, shall no longer provide such services for the Business.

 

12.       Survival; Indemnification.

 

(a)       Survival of Representations and Warranties; Notice. The
representations and warranties of Seller and Buyer contained in this Agreement,
and the parties’ respective rights to assert any claims against the other
related thereto, shall NOT survive the Closing Date under this Agreement.

 

(b)        Indemnification by Buyer. Buyer shall indemnify, defend, hold
harmless, pay and reimburse Seller, its affiliates and their respective
directors, officers, equity and debt holders, partners, members, managers,
employees, agents and representatives and their heirs, successors and assigns,
each in their capacity as such (the “Seller Indemnified Parties”), from, against
and in respect of any damages, losses, charges, liabilities, claims, demands,
actions, suits, proceedings, payments, judgments, settlements, assessments,
deficiencies, taxes, interest, penalties, and reasonable costs and expenses
(including reasonable attorneys’ fees and out of pocket disbursements), whether
in respect of third party claims, claims between the parties hereto, or
otherwise, directly or indirectly relating to, arising out of or resulting from
(i) any of the Assumed Liabilities, or (ii) any breach by Buyer of any of its
covenants or agreements contained herein or the Ancillary Documents.

 

(c)       Indemnification by Seller. Seller shall indemnify, defend, hold
harmless, pay and reimburse Buyer, its affiliates and their respective
directors, officers, equity and debt holders, partners, members, managers,
employees, agents and representatives and their heirs, successors and assigns,
each in their capacity as such (the “Buyer Indemnified Parties”), from, against
and in respect of any damages, losses, charges, liabilities, claims, demands,
actions, suits, proceedings, payments, judgments, settlements, assessments,
deficiencies, taxes, interest, penalties, and reasonable costs and expenses
(including reasonable attorneys’ fees and out of pocket disbursements), whether
in respect of third party claims, claims between the parties hereto, or
otherwise, directly or indirectly relating to, arising out of or resulting from
(i) any of the Excluded Assets or any Liabilities other than the Assumed
Liabilities, and (ii) any breach by Seller of any of its covenants or agreements
contained herein or the Ancillary Documents. Notwithstanding any other provision
of this Section 10, Buyer shall be entitled to indemnification for breaches only
when the aggregate of all Losses of Buyer as a result of Seller’s breach of its
representations or warranties exceeds Twenty Five Thousand Dollars ($25,000.00)
(the “Threshold”) and, if the Threshold is exceeded, (i) for the entire amount
of such Losses (regardless of the Threshold) up to a maximum recovery of the
Purchase Price.

 

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(d)       Brokers. Each party shall indemnify and hold the other harmless from
and against any and all losses, costs, liabilities, expenses or damages arising
from any engagement by such party of, or services rendered to it by, any finder,
broker, agency, or other intermediary, in connection with the Transaction, or
any allegation of any such engagement or services.

 

13.       Miscellaneous.

 

(a)       Notices. Any notice or other correspondence to be given in connection
with this Agreement shall be in writing and shall be delivered to the addresses
provided below. Each such notice or other correspondence shall be effective the
next Business Day if sent overnight by nationally recognized courier, or the
same day as when delivered in person. Copies of notices, requests and other
communications may be provided by Email (effective upon delivery) to the Email
addresses listed below but delivery by Email shall only constitute notice for
purposes of this Agreement if the sender in the same day sends a confirming copy
of such notice overnight by nationally recognized courier.

 

Notices to Seller:

 

Bare Metal Standard Inc.

 

With a copy to:

 

 

Notices to Buyer:

James Bedal

 

 

(b)       Further Assurances. Each party covenants that at any time, and from
time to time, after the Closing Date, but subject to the express provisions of
this Agreement and the Ancillary Documents and without expanding any party’s
express obligations hereunder and thereunder, it will execute and deliver such
additional instruments and take such actions as may be reasonably requested by
the other party to confirm or perfect or otherwise to carry out the intent and
purposes of this Agreement and the Ancillary Documents.

 

(c)       Expenses. Except as otherwise expressly provided in this Agreement,
all costs and expenses incurred in connection with this Agreement and the
Transaction shall be borne by the party incurring such costs and expenses or the
party upon which such costs or expenses are imposed by applicable Law. Buyer
shall be responsible for and shall pay all transfer fees (if any) imposed by any
third party in connection with the sale of the Sale Assets.

 

(d)       Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the parties
shall negotiate in good faith with a view to the substitution therefor of a
suitable and equitable solution in order to carry out, so far as may be valid
and enforceable, the intent and purpose of such invalid provision; provided,
however, that the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions contained herein shall not
be in any way impaired thereby, it being intended that all of the rights and
privileges of the parties hereto shall be enforceable to the fullest extent
permitted by Law.

 

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(e)        Governing Law; Jurisdiction; Waiver of Jury Trial. THIS AGREEMENT AND
THE ANCILLARY DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE
STATE OF IDAHO WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD
REQUIRE THE APPLICATION OF ANY OTHER LAW. Each party hereto agrees that it shall
bring any action or proceeding in respect of any claim arising out of or related
to this Agreement, the Ancillary Documents or the Transaction, exclusively in
the courts of the State of Idaho. Each of the parties hereto agrees not to bring
any action or proceeding arising out of or relating to this Agreement, the
Ancillary Documents, the Transaction or any of the matters contemplated hereby
or thereby other than in the chosen courts.

 

(f)        Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties and supersedes any and all prior and
contemporaneous agreements, understandings, correspondence, representations and
warranties, oral or written with respect to the subject matter of this
Agreement, except for the Confidentiality Agreement, which shall remain in full
force and effect in accordance with its terms. The parties hereto have
voluntarily agreed to define their rights, remedies, liabilities and obligations
respecting the Sale Assets, the Transaction and the Business exclusively in
contract pursuant to the express terms and provisions of this Agreement and the
Ancillary Documents and the parties hereto expressly disclaim that they are owed
any duties or are entitled to any remedies not expressly set forth in this
Agreement. The sole and exclusive remedies for any breach of the terms and
provisions of this Agreement (including any representations and warranties set
forth herein) or any claim or cause of action otherwise arising out of or
related to the Sale Assets, the Transaction or the Systems shall be those
remedies available at law or equity for breach of contract only (as such
contractual remedies have been further limited, waived or otherwise excluded
pursuant to the express terms of this Agreement, including Section 11(b)). The
parties each hereby acknowledge that this Agreement embodies the justifiable
expectations of sophisticated parties derived from arm’s length negotiations and
each party to this Agreement specifically acknowledge that no party has a
special relationship with another party that would justify any expectation
beyond that of an ordinary buyer and an ordinary seller in an arms-length
transaction. Buyer hereby agrees that it shall have no remedies, claims or
causes of action (whether in contract, tort or otherwise) for any statements,
communications, disclosures, failures to disclose, representations or warranties
not set forth in Section 9 of this Agreement.

 

(g)       Amendment; Waiver. This Agreement may not be amended, modified or
supplemented in any manner, whether by course of conduct or otherwise, except by
an instrument in writing which makes specific reference to this Agreement and
which is signed by Seller and Buyer. Any provision of this Agreement may be
waived only if such waiver is in writing and signed by the party against whom
the waiver is to be effective. No failure or delay by any party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.

 

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(h)       Bulk Sales. Seller and Buyer agree to waive compliance with any bulk
sale or similar Laws that are applicable to this Transaction.

 

(i)       No Presumption Against Drafting Party; Headings. Each of Buyer and
Seller represents that it has been represented by counsel in connection with
this Agreement, the Ancillary Documents and the transactions contemplated hereby
and thereby. Legal or equitable principles that might require the construction
of this Agreement or the Ancillary Documents or any provision hereof or thereof
against the party drafting this Agreement or the Ancillary Documents shall not
apply in any construction or interpretation of this Agreement or the Ancillary
Documents and is expressly waived. In the event an ambiguity or question of
intent or interpretation arises, this Agreement and the Ancillary Documents
shall be construed as if drafted jointly by the parties and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement or the Ancillary
Documents. The headings contained in this Agreement are for convenience of
reference only and shall have no effect on the interpretation or operation
hereof.

 

(j)       Personal Liability. It is expressly understood and the parties
expressly agree that nothing contained in this Agreement or in any Ancillary
Document or in any other document contemplated hereby or thereby (whether from a
breach of covenant, representation, warranty or other provision herein or
therein and whether in contract, tort or otherwise) shall create or be deemed to
create or permit any personal liability or obligation on the part of any direct
or indirect equity holder of Seller (or any of its affiliates) or Buyer (or any
of its affiliates) or any past or present officer, director, employee, member,
manager, agent, partner, affiliate, advisor or representative of either party
hereto.

 

(k)       Successors and Assigns; No Third-Party Beneficiaries. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that Buyer shall not assign its
obligations or rights hereunder without Seller’s prior written consent. Nothing
in this Agreement, express or implied, is intended to confer upon any person or
entity other than Buyer, Seller, Seller Indemnified Parties and their respective
successors, legal representatives and permitted assigns, any rights or remedies
under or by reason of this Agreement.

 

(l)       Counterparts; Execution. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same Agreement. This Agreement may be
executed by delivery of a signature by facsimile, Email (PDF) or other
electronic means reasonably acceptable to both parties and such signature shall
constitute an original for all purposes.

 

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(m)        Enforcement. Buyer agrees that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached by Buyer.
Accordingly, Seller shall be entitled to seek specific performance of the terms
hereof, including an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this
Agreement, this being in addition to any other remedy to which Seller is
entitled at law or in equity. Buyer further hereby waives (a) any defense in any
action for specific performance that a remedy at law would be adequate and (b)
any requirement under any law to post security as a prerequisite to obtaining
equitable relief.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, this Asset Purchase Agreement has been executed and
delivered as of the date first above written.

 

 

 

  Seller:   BARE METAL STANDARD INC.               By:       Name:  James Bedal
    Title:  Chief Executive Officer         Buyer:       Code 96, LLC          
    By:       Name: James Bedal     Title:  Manager