Exhibit 10.22
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated August 31, 2007, is by
and among Radical Holdings LP, a Texas limited partnership (“Seller”),
Immediatek, Inc., a Nevada corporation (“Immediatek”), and IMKI Ventures, Inc.,
a Delaware corporation and a wholly-owned subsidiary of Immediatek (“Buyer” and,
together with Immediatek, the “Buyer Parties” and, together with Seller,
collectively, the “Parties”).
RECITALS:
WHEREAS, Seller has acquired certain assets; and
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to purchase from
Seller, the Purchased Assets (as hereinafter defined), all on the terms and
subject to the conditions set forth herein.
AGREEMENT:
NOW, THEREFORE, in consideration of the premises, the respective
representations, warranties, covenants and agreements contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and intending to be legally bound, the Parties
hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF ASSETS
1.1 Purchase and Sale of Assets.
(a) Purchased Assets. Buyer hereby purchases from Seller, and Seller hereby
transfers and delivers to Buyer, all rights, titles and interests in and to all
of the assets listed on Schedule 1.1(a) attached hereto (all of the assets
listed on Schedule 1.1(a) are referred to herein, collectively, as the
“Purchased Assets”).
(b) Excluded Assets. The Purchased Assets will exclude the following
(collectively, the “Excluded Assets”), which shall remain Seller’s property
immediately following the Closing (as defined in Section 1.3): (i) any of
Seller’s rights under this Agreement, each Contract (as defined in Section 3.8
hereof) or writing executed or delivered in connection with this Agreement and
each amendment or supplement to any of the foregoing (including this Agreement,
the “Transaction Documents”); and (ii) any asset not specifically identified on
Schedule 1.1(a).
1.2 Assumed Liabilities.
(a) Assumed Liabilities. Buyer hereby assumes, and becomes responsible for, the
liabilities and obligations of Seller (collectively, the “Assumed Liabilities”)
listed on Schedule 1.2(a).
 
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(b) Excluded Liabilities. The Assumed Liabilities exclude, and Buyer does not
assume or have any responsibility with respect to, all other liabilities or
obligations of Seller (collectively, the “Excluded Liabilities”), including
liabilities or obligations: (i) for taxes of any kind whatsoever; (ii) for costs
and expenses incurred in connection with negotiating the Transaction Documents
and performing the transactions contemplated thereby (the “Transactions”);
(iii) under any Transaction Document; (vi) under any Contract, regardless of
whether Seller’s rights thereunder are included in the Purchased Assets, unless
such Contract is listed as an Assumed Liability on Schedule 1.2(a); and (v) not
specifically identified on Schedule 1.2(a).
1.3 Purchase Price. The purchase price for the Purchased Assets (the “Purchase
Price”) is 60,514 shares of Immediatek common stock (the “Immediatek Shares”),
which represents the quotient of $151,285 and the closing price of the shares of
Immediatek common stock as reported by the Over-the-Counter Bulletin Board
(“OTCBB”) on the trading day immediately preceding the Closing Date (as defined
in Section 1.4 hereof). Immediatek tendered the Immediatek Shares, or will
irrevocably instruct the Immediatek Shares to be tendered, upon the execution
and delivery of this Agreement by all Parties (the “Closing”) to Seller. Buyer
and Seller will file IRS Form 8594, if applicable, and all federal, state, local
and foreign tax returns, in accordance with the purchase price allocation set
forth on Schedule 1.3.
1.4 Deliveries. On the date of Closing (the “Closing Date”),
(a) Seller has delivered, or caused to be delivered, to Buyer (i) a bill of sale
and, if necessary, an assignment and assumption agreement, each duly executed by
Seller, (ii) such other bills of sale, certificates of title or origin, deeds,
assignments and other instruments of transfer or conveyance as may be otherwise
necessary to evidence and effect the assignment and delivery of the Purchased
Assets to Buyer, and (iii) an officer’s certificate and a secretary’s
certificate for Seller, duly executed by the appropriate person; and
(b) The applicable Buyer Parties have delivered, or caused to be delivered, to
Seller (i) the Purchase Price, (ii) if necessary, an assignment and assumption
agreement duly executed by Buyer, and (iii) an officer’s certificate and a
secretary’s certificate for each Buyer Party, each duly executed by the
appropriate person.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES CONCERNING THE BUYER PARTIES
Each Buyer Party, jointly and severally, represents and warrants to Seller that
the statements contained in this ARTICLE 2 are correct and complete on the
Closing Date, except as set forth in the schedules that the Buyer Parties
delivered to Seller on the Closing Date.
2.1 Organization of Buyer Parties. Each Buyer Party is an entity duly organized,
validly existing and in good standing under the Laws (as defined in Section 3.3
hereof) of the jurisdiction of its organization. Each Buyer Party has the
requisite entity power and authority necessary to own or lease its properties
and to carry on its businesses as currently conducted. There is no pending, or
(to each Buyer Party’s knowledge) threatened, action, suit, arbitration,
mediation, investigation or similar proceeding (an “Action”) for the
dissolution, liquidation, insolvency or rehabilitation of such Buyer Party.
 
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2.2 Authority of Buyer Parties; Enforceability. Each Buyer Party has the
relevant entity power and authority necessary to execute and deliver each
Transaction Document to which it is a party and to perform and consummate the
Transactions. Each Buyer Party has taken all action necessary to authorize its
execution and delivery of each Transaction Document to which such Buyer Party is
a party, the performance of its respective obligations thereunder and its
consummation of the Transactions. Each Transaction Document to which the Buyer
Party is a party has been duly authorized, executed and delivered by such Buyer
Party and is enforceable against such Buyer Party in accordance with its terms,
except as such enforceability may be subject to the effects of bankruptcy,
insolvency, reorganization, moratorium or other Laws relating to or affecting
the rights of creditors and general principles of equity (an “Enforceability
Exception”).
2.3 No Violation. Except as listed on Schedule 2.3, the execution and delivery
by each Buyer Party of this Agreement and the other Transaction Documents to
which such Buyer Party is a party, the performance by each Buyer Party of its
respective obligations hereunder and thereunder and the consummation of the
Transactions by each Buyer Party will not (a) with or without notice or lapse of
time, constitute or create a material breach or violation of, or material
default under, any Law, Order, Contract or Permit (as defined in Section 3.3
hereof) to which such Buyer Party is a party or by which it is bound or any
provision of such Buyer Party’s organizational documents as in effect on the
Closing Date, (b) require any consent, approval, notification, waiver or other
similar action (a “Consent”) under any Contract or organizational document to
which the Buyer Party is a party or by which it is bound or (c) require any
Permit under any Law or Order, other than (i) required filings, if any, with the
Securities and Exchange Commission or (ii) notifications or other filings with
state or federal regulatory agencies after the Closing that are necessary or
convenient and do not require approval of the agency as a condition to the
validity of the Transactions.
2.4 Immediatek Common Stock. The Immediatek Shares have been duly authorized,
and when issued in accordance with the terms and conditions of this Agreement,
the Immediatek Shares will be duly and validly issued, fully paid and
nonassessable and free and clear of all liens, charges, restrictions, claims and
encumbrances, other than restrictions on transfer imposed by the Securities Act
(as defined in Section 3.15(a) hereof) and applicable state securities laws.
ARTICLE 3
SELLER’S REPRESENTATIONS AND WARRANTIES
Seller hereby represents and warrants to the Buyer Parties that the statements
contained in this ARTICLE 3 are correct and complete on the Closing Date, except
as set forth in the schedules Seller delivered to the Buyer Parties on the
Closing Date.
 
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3.1 Entity Status. (a) Seller is duly organized, validly existing and in good
standing under the Laws of the jurisdiction of its organization, (b) Seller is
duly authorized to conduct its business and is in good standing under the Laws
of each jurisdiction where such qualification is required, (c) Seller has the
requisite entity power and authority necessary to own or lease its properties
and to carry on its businesses as currently conducted, (d) Seller is not in
breach or violation of, or default under, any provision of its organizational
documents and (e) there is no pending, or (to Seller’s knowledge) threatened,
Action for its dissolution, liquidation, insolvency or rehabilitation.
3.2 Power and Authority; Enforceability. Seller has the relevant entity power
and authority necessary to execute and deliver each Transaction Document to
which it is a party and to perform and consummate the Transactions. Seller has
taken all action necessary to authorize the execution and delivery by Seller of
each Transaction Document to which it is a party, the performance of its
obligations thereunder, and the consummation by Seller of the Transactions. Each
Transaction Document to which Seller is a party has been duly authorized,
executed and delivered by Seller and is enforceable against Seller in accordance
with its terms, subject to an Enforceability Exception.
3.3 No Violation. Except as listed on Schedule 3.3, the execution and delivery
by Seller of this Agreement and the other Transaction Documents to which Seller
is a party, the performance by Seller of its obligations hereunder and
thereunder, the consummation of the Transactions by Seller and Buyer’s ownership
of the Purchased Assets immediately following the Closing will not (a) with or
without notice or lapse of time, constitute or create a material breach or
violation of, or material default under, any (i) law (statutory, common or
otherwise), constitution, ordinance, rule, regulation, executive order or other
similar authority (“Law”) enacted, adopted, promulgated or applied by any
legislature, agency, bureau, branch, department, division, commission, court,
tribunal or other similar recognized organization or body of any federal, state,
county, municipal, local or foreign government or other similar recognized
organization or body exercising similar powers or authority (a “Governmental
Body”), (ii) order, ruling, decision, award, judgment, injunction or other
similar determination or finding by, before or under the supervision of any
Governmental Body or arbitrator (an “Order”), (iii) Contract or Permit to which,
in the case of (i), (ii) or (iii), Seller is a party or by which it is bound or
to which any Purchased Asset is subject, or (iv) organizational document of
Seller as in effect on the Closing Date, (b) result in the imposition of any
lien, claim or encumbrance (an “Encumbrance”) upon any Purchased Asset, other
than Permitted Encumbrances (as defined in Section 3.7), (c) require any Permit
or Consent under any Law, Order, Contract or organizational document to which
Seller is a party or by which Seller is bound or to which any Purchased Asset is
subject or (d) in any other way materially and adversely impair any Purchased
Asset. For purposes of this Agreement, “Permit” means permits, licenses,
certificates, waivers, notices and similar authorizations.
3.4 Subsequent Events; Solvency. Except as set forth in Schedule 3.4, since
August 15, 2007 to the Closing Date, there have been no events, series of events
or the lack of occurrence thereof that, singularly or in the aggregate, could
reasonably be expected to have a material adverse effect on the Purchased
Assets. Seller is not now insolvent, nor will Seller be rendered insolvent by
any of the Transactions. A person is “insolvent” for purposes of this Section
3.4 when the sum of its liabilities and obligations is greater than a fair
valuation of all of its property.
 
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3.5 No Undisclosed Liabilities. The Purchased Assets are not subject to any
liability or obligation (and, to Seller’s knowledge, there is no basis for any
present or future Action or Order against Seller or the Purchased Assets giving
rise to any liability or obligation), except for (a) those reflected on
Schedule 1.2(a) and (b) those arising after August 15, 2007, in Seller’s
ordinary course of business, which, individually or in the aggregate, are not
material and that do not (i) result from, or relate to, any tort or infringement
or any breach, violation of or default under any Law, Order, Permit or Contract
or (ii) arise out of any Action or Order. Seller does not have any liability or
obligation to pay any compensation to any broker, finder or agent with respect
to the Transactions for which the Buyer Parties could become directly or
indirectly responsible.
3.6 Legal Compliance. Seller has materially complied with all Laws and Orders,
and no Action is pending or, to Seller’s knowledge, threatened against Seller
alleging any failure to so comply. No material expenditures are, or based on any
Law, Order or Permit will be, required of Buyer to own and operate the Purchased
Assets in compliance with all Laws, Orders and Permits at the time immediately
following the Closing.
3.7 Availability, Title to and Condition of Purchased Assets. Except as set
forth on Schedule 3.7, (a) Seller has (and subject to Buyer’s own actions after
the Closing, Buyer will have) good, marketable and indefeasible title to, or a
valid leasehold interest in, all of the Purchased Assets, in each case free and
clear of any Encumbrances other than (i) statutory, mechanics’ or other liens
that were incurred in Seller’s ordinary course of business, (ii) Encumbrances
that are being contested in good faith and for which adequate reserve has been
made, (iii) liens for Taxes incurred but not yet due and (iv) Encumbrances set
forth on Schedule 3.7 (collectively, “Permitted Encumbrances”) and (b) all
tangible assets (except for Excluded Assets) included as part of the Purchased
Assets, whether owned or leased, are free from defects (patent and latent), have
been maintained in accordance with normal industry practice, are in good
operating condition (subject to normal wear and tear) and are suitable for the
purposes for which they are currently used and currently proposed to be used.
3.8 Contracts. Schedule 3.8 lists each contract, agreement, arrangement,
commitment, instrument, document or similar understanding (whether written or
oral), including leases, subleases and rights thereunder (“Contracts”) that
relates to any of the Purchased Assets. Seller has delivered to Buyer a correct
and complete copy of each written Contract (as amended to date) listed on
Schedule 3.8 and a written summary setting forth the terms and conditions of
each oral Contract referred to in Schedule 3.8. Each such Contract is
enforceable and will continue to be enforceable on identical terms following the
consummation of the Transactions. Neither Seller nor, to Seller’s knowledge, any
of the counter-parties to any such Contract is, or has been, in (and no event
has occurred that, with or without notice or lapse of time, would create or
constitute a) breach or violation of, or default under, any of such Contract’s
material provisions. No party to such Contract has repudiated any provision of
the Contract. Schedule 3.8 denotes each such Contract to which Seller or any of
its Affiliates is a party (excluding Seller). Each of the Contracts listed on
Schedule 3.8 is assignable by Seller or its Affiliates without any other
person’s Consent. “Affiliate” with respect to a specified person means any other
person who, directly or indirectly, through one or more intermediaries, controls
or is controlled by, or is under common control with, the specified person.
 
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3.9 Litigation. Schedule 3.9 sets forth each instance in which Seller (a) is
subject to any outstanding Order or (b) is a party or the subject of, or, to
Seller’s knowledge, is threatened to be made a party to or the subject of, any
Action. No Order or Action required to be set forth in Schedule 3.9 questions
the enforceability of a Transaction Document or the Transactions, or could
result in any material adverse effect on the Purchased Assets, nor does Seller
have any basis to believe that any such Action may be brought or threatened
against Seller or any Buyer Party.
3.10 Environmental, Health and Safety Matters. As used in this Agreement,
“Environmental, Health and Safety Requirements” means all Laws, Orders, Permits,
Contracts and programs (including those promulgated or sponsored by industry
associations, insurance companies and risk management companies) concerning or
relating to public health and safety, worker/occupational health and safety and
pollution or protection of the environment, including those relating in any way
to noises, radiation or chemicals, toxic or hazardous materials, substances or
wastes, each as amended and as now in effect. Except as set forth in
Schedule 3.10, (a) Seller is in compliance with all Environmental, Health and
Safety Requirements in connection with owning, using, maintaining or operating
its business, operations or assets; (b) each location at which Seller operates,
or has operated, the Purchased Assets is in compliance with all Environmental,
Health and Safety Requirements; and (c) there are no pending or threatened
allegations by any person that any of Seller’s properties or assets are not, or
that the Seller’s operations have not been, conducted in compliance with all
Environmental, Health and Safety Requirements.
3.11 Employees.
(a) Schedule 3.11 contains a list setting forth, (i) the name and current annual
salary and other compensation payable by Seller or its Affiliates to each
employee, independent contractor, agent or consultant of Seller or its
Affiliates employed or engaged in connection with the Purchased Assets (an
“Employee”); (ii) the profit sharing, bonus or other form of additional
compensation paid or payable by Seller or its Affiliates to, or for the benefit
of, each such Employee for the current fiscal year; and (iii) any and all loans
outstanding from Seller or its Affiliates to any Employee. Except as set forth
on Schedule 3.11, there are no oral or written contracts, agreements or
arrangements relating to compensation or performance awards or obligating Seller
or its Affiliates to increase the compensation or benefits presently being paid
or hereafter payable to any of the Employees. There is not due or owing, and
there will not be due and owing at the Closing, to any of the Employees, any
sick pay, severance pay (whether arising out of the termination of an Employee
prior to or subsequent to the Closing), compensable time or pay, including, but
not limited to, salary, commission and bonuses, personal time or pay or vacation
time or vacation pay attributable to service rendered on or prior to the Closing
Date, other than set forth on Schedule 3.11. There is not now, and there will
not be as of the Closing Date, any liability of, or claims against, Seller or
its Affiliates (including, without limitation, workers’ compensation claims and
claims or suits for contribution to, or indemnification of, third parties,
occupational health and safety, environmental, consumer protection or equal
employment matters) for injury, sickness, disease, discrimination, death or
termination of employment of any Employee or other employment matter (including,
without limitation, any Employee or former Employee or any contractor or
subcontractor of Seller or its Affiliates), to the extent attributable to an
event occurring, or a state of facts existing, prior to the Closing other than
as set forth on Schedule 3.11; it being understood and agreed that Seller or its
Affiliates shall remain liable for, and indemnify and hold harmless the Buyer
Parties against, any and all claims, liabilities, damages, losses, costs or
expenses, of any nature whatsoever, incurred by Seller or its Affiliates, or
resulting from or relating to any Employees (whether hourly or salaried),
including, but not limited to, those set forth on Schedule 3.11.
 
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(b) Seller is not a party to any collective bargaining agreements, written or
oral, which cover any Employees. There have not been, and there are no, strikes,
grievances, disputes or controversies pending or threatened between Seller or
its Affiliates and any of their respective Employees or any union or other
organization claiming to represent such Employees’ interests. There is no
request for union representation pending, and there is no present union
organizing or election activities in progress or, to Seller’s knowledge,
threatened with respect to any Employees. There is no unfair labor practice
complaint pending before the National Labor Relations Board or, to Seller’s
knowledge, threatened against or relating to Seller.
(c) The purchase of the Purchased Assets by Buyer hereunder will not subject the
Buyer Parties to any absolute or contingent, direct or indirect liability to or
claim by past, present or future Employees (except for obligations expressly
assumed by Buyer hereunder).
3.12 Employee Benefits. Schedule 3.12 lists each non-qualified deferred
compensation plan, qualified defined contribution retirement plan, qualified
defined benefit retirement plan or other material fringe benefit plan or program
that Seller or its Affiliates maintain or to which they contribute with respect
to the Employees. With respect to any employee benefit plan, within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974
(“ERISA”), which is subject to ERISA and which is sponsored, maintained or
contributed to, or has been sponsored, maintained or contributed to, within six
years prior to the Closing Date, by Seller or any person deemed to be affiliated
or aggregated with Seller under Sections 414(b), (c), (m) or (o) of the Internal
Revenue Code of 1986 (the “Code”) or Section 4001(a)(14) of ERISA, (a) no
unsatisfied withdrawal liability or obligation, within the meaning of
Section 4201 of ERISA, has been incurred, (b) no unsatisfied liability or
obligation to the Pension Benefit Guaranty Corporation has been incurred by
Seller or any ERISA Affiliate, (c) no accumulated funding deficiency, whether or
not waived, within the meaning of Section 302 of ERISA or Section 412 of the
Code has been incurred and (d) all contributions (including installments) to
such plan required by Section 302 of ERISA and Section 412 of the Code have been
timely made. With respect to any kind of employee benefit plan, such plan has
been funded and maintained in compliance with all Laws applicable thereto and
the requirements of such plan’s governing documents.
3.13 Intellectual Property. As used in this Agreement, “Intellectual Property”
means any rights, licenses, charges, Encumbrances, equities and other claims
that any person may have to claim ownership, authorship or invention of, to use,
to object to or prevent the modification of or to withdraw from circulation or
control the publication or distribution of, any: (a) copyrights in both
published works and unpublished works, (b) fictitious business names, trading
names, corporate names, registered and unregistered trademarks, service marks
and applications, (c) any (i) patents and patent applications and (ii) business
methods, inventions and discoveries that may be patentable, (d) computer
software or middleware and (e) know-how, trade secrets, confidential
information, customer lists, software (source code and object code), technical
information, data, process technology, plans, drawings and blue prints. Except
as set forth in Schedule 3.13, Seller owns, or possesses adequate rights to use,
all Intellectual Property that constitutes a part of the Purchased Assets. No
Permit is required for the assignment of all interests in the Intellectual
Property constituting any Purchased Asset to Buyer as part of the Transactions.
To Seller’s knowledge, Seller’s use of the Intellectual Property does not, and
Buyer’s use of such Intellectual Property after Closing will not, infringe upon
any rights any other person owns or holds.
 
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3.14 Taxes. Seller is not subject to any liability or obligation for any
federal, state, local or foreign income, gross receipts, license, payroll,
employment, excise, occupation, customs, ad valorem, duties, franchise,
withholding, social security, unemployment, real property, personal property,
sales, use, transfer, registration, estimated or other tax of any kind
whatsoever, including any interest, penalty or addition thereto, whether
disputed or not (“Taxes”), including Taxes relating to prior periods, other than
those reflected or reserved against in Seller’s financial statements or those
incurred in Seller’s ordinary course of business. Seller has duly filed, when
due, all Tax reports and returns in connection with and in respect of its
business, assets and employees, and has timely paid and discharged all amounts
shown as due thereon. Seller has made available to Buyer accurate and complete
copies of all of its Tax reports and returns for all periods, except those
periods for which returns are not yet due. Except for Permitted Encumbrances,
there are no Encumbrances for Taxes upon, or pending or threatened against, any
Purchased Asset. Seller is not subject to any Tax allocation or sharing
Contract.
3.15 Immediatek Common Stock.
(a) Seller is an “accredited investor” within the meaning of Rule 501 of
Regulation D promulgated under the Securities Act of 1933 (the “Securities
Act”);
(b) Seller has sufficient knowledge and experience in investing in companies
similar to Immediatek in terms of Immediatek’s stage of development so as to be
able to evaluate the risks and merits of its investment in Immediatek, and
Seller is able financially to bear the risks thereof, including a total loss of
Seller’s investment;
(c) Seller (i) has received all the information that it has deemed necessary to
make an informed investment decision with respect to the acquisition of the
Immediatek Shares; (ii) understands that Immediatek is subject to the reporting
requirements of the Securities Exchange Act of 1934 (the “Exchange Act”), and
has had an opportunity to review all publicly available filings made by
Immediatek with the Securities and Exchange Commission (the “SEC”) pursuant to
either the Securities Act or the Exchange Act; (iii) has had the unrestricted
opportunity to make such investigation as it has desired pertaining to
Immediatek and the acquisition of an interest therein and to verify the
information that is, and has been, available to it; and (iv) has had the
opportunity to ask questions of Immediatek and representatives of Immediatek
concerning Immediatek. The foregoing, however, does not in any way limit or
modify the representations and warranties made by the Buyer Parties in ARTICLE
2;
 
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(d) the Immediatek Shares being acquired by Seller are being acquired for its
own account for the purpose of investment and not with a view to, or for resale
in connection with, any distribution thereof within the meaning of the
Securities Act;
(e) Seller has not received any public solicitation or advertisement with
respect to the Immediatek Shares;
(f) Seller understands that (i) the Immediatek Shares have not been registered
under the Securities Act or any state securities laws by reason of their
issuance in a transaction exempt from the registration requirements of the
Securities Act and such laws, (ii) the Immediatek Shares must be held
indefinitely, unless a subsequent disposition thereof is registered under the
Securities Act or is exempt from such registration, and (iii) the Immediatek
Shares will bear the legend to such effect set forth in Section 3.16 hereof.
3.16 Legend. Seller hereby acknowledges that the certificates evidencing the
Immediatek Shares will bear the legend set forth below or substantially similar
legend:
The securities represented hereby have not been registered under the Securities
Act of 1933, as amended (the “Act”), or under the securities laws of certain
states. These securities are subject to restrictions on transferability and
resale and may not be transferred or resold except as permitted under the Act
and the applicable state securities laws, pursuant to registration or exemption
therefrom. The issuer of these securities may require an opinion of counsel
(which may be counsel for the issuer) in form and substance satisfactory to the
issuer to the effect that any proposed transfer or resale is in compliance with
the Act and any applicable state securities laws.
The legend set forth above shall be removed by Immediatek from any certificate
evidencing the Immediatek Shares, and Immediatek shall issue, or cause to be
issued, a certificate without such legend to the holder thereof, if requested,
upon delivery to Immediatek of an opinion by counsel (which may be counsel for
Immediatek) that such security can be freely transferred in a public sale
without a registration statement being in effect and that such transfer will not
jeopardize the exemption or exemptions from registration pursuant to which
Immediatek issued the Immediatek Shares; provided, however, that no opinion from
counsel shall be required for any dispositions pursuant to Rule 144(k) under the
Securities Act.
3.17 Third Party Options. There are no existing Contracts, options, commitments
or rights with, to or in any third party to acquire the Purchased Assets or any
interest therein.
3.18 Creditors. On or after the Closing Date, the Buyer Parties shall not be
subject to any claim of a creditor of Seller, or to any obligation to pay,
discharge or satisfy in any manner Seller’s liabilities or other obligations as
a result of the sale and transfer of the Purchased Assets to Buyer under this
Agreement, other than liabilities assumed by Buyer pursuant to Section 1.2.
 
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3.19 Accuracy of Information Furnished. No representation, statement or
information contained in this Agreement, any of the Transaction Documents or any
Contract or other document made available or furnished to any Buyer Party or
their respective representatives by Seller contains any untrue statement of a
material fact or omits any material fact necessary to make the information
contained therein not misleading. All projections and estimates that have been
provided to any Buyer Party were, at the time of creation, reasonably made in
good faith based on reasonable assumptions, given the circumstances at the time
such assumptions were made.
ARTICLE 4
COVENANTS
4.1 General. If, at any time after the Closing, any further action is necessary
or desirable to carry out this Agreement’s purposes, each Party will take such
further action (including executing and delivering any further instruments and
documents, obtaining any Permits and Consents and providing any reasonably
requested information) as any other Party may reasonably request, all at the
requesting Party’s sole cost and expense (unless the requesting Party is
entitled to indemnification therefor under ARTICLE 5).
4.2 Privilege Rights. The Parties agree that, after the Closing, Buyer will be
exclusively entitled to assert or waive rights with respect to any privileges to
information that any Party may assert under Law relating to the Purchased Assets
or the Assumed Liabilities, including in any Action related to the foregoing or
any other Action in which Buyer or its assets are a party. Privileged
information includes privileges arising under, or relating to, the
attorney-client relationship, the accountant-client privilege and privileges
relating to internal evaluative processes.
ARTICLE 5
INDEMNIFICATION
5.1 Survival of Representations, Warranties and Covenants. Each representation
and warranty of the Parties contained herein and any certificate related to such
representations and warranties will survive the Closing and continue in full
force and effect for one year thereafter, except (i) the representations and
warranties set forth in Sections 3.10, 3.12 and 3.14, which will survive the
Closing and continue in full force and effect until the applicable statute of
limitations expires (or for five years if there is no applicable statute of
limitations) and (ii) the representations and warranties set forth in
Sections 2.1, 2.2, 3.1 and 3.2, which will survive the Closing and will continue
in full force and effect forever. Each covenant and obligation in this Agreement
and any certificate or document delivered pursuant to this Agreement will
survive the Closing forever. Unless expressly waived pursuant to this Agreement,
no representation, warranty, covenant, right or remedy available to any person
in connection with the Transactions will be deemed waived by any action or
inaction of that person (including consummation of the Transactions, any
inspection or investigation, or the awareness of any fact or matter) at any
time, whether before, on or after the Closing.
 
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5.2 Indemnification Provisions for the Buyer Parties’ Benefit. "Damages” means
all losses (including diminution in value), damages and other costs and expenses
of any kind or nature whatsoever, whether known or unknown, contingent or
vested, matured or unmatured, and whether or not resulting from third-party
claims, including costs (including reasonable fees and expenses of attorneys,
other professional advisors and expert witnesses and the allocable portion of
the relevant person’s internal costs) of investigation, preparation and
litigation in connection with any Action or threatened Action. Seller shall
indemnify and hold the Buyer Parties and their respective Affiliates, and their
respective officers, directors, managers, employees, agents, representatives,
controlling persons, stockholders and similarly situated persons, harmless from,
and pay any and all Damages, directly or indirectly, resulting from, relating
to, arising out of or attributable to any of the following: (a) any breach of
any representation or warranty Seller has made in this Agreement; (b) any
breach, violation or default by Seller of any obligation of Seller in this
Agreement; (c) the operation and ownership of, or conditions first occurring
with respect to, the Purchased Assets prior to 11:59 p.m. on the Closing Date
(other than the Assumed Liabilities relating thereto); and (d) the Excluded
Assets or Excluded Liabilities.
5.3 Indemnification Provisions for Seller’s Benefit. Each Buyer Party shall,
jointly and severally, indemnify and hold Seller and its Affiliates, and their
respective officers, directors, managers, employees, agents, representatives,
controlling persons, stockholders and similarly situated persons, harmless from,
and pay any and all Damages, directly or indirectly, resulting from, relating
to, arising out of or attributable to any of the following: (a) any breach of
any representation or warranty that a Buyer Party has made in this Agreement;
(b) any breach, violation or default by a Buyer Party of any obligation of a
Buyer Party in this Agreement; and (c) except as contemplated by Section 5.2,
the Assumed Liabilities or Purchased Assets.
5.4 Indemnification Claim Procedures. If any Action is commenced or threatened
that may give rise to a claim for indemnification (an “Indemnification Claim”)
by any person entitled to indemnification under this Agreement (each, an
“Indemnified Party”) against any person obligated to indemnify an Indemnified
Party (an “Indemnitor”), then such Indemnified Party will promptly give notice
to the Indemnitor. Failure to notify the Indemnitor will not relieve the
Indemnitor of any liability that it may have to the Indemnified Party, except to
the extent the defense of such Action is materially and irrevocably prejudiced
by the Indemnified Party’s failure to give such notice. An Indemnitor may elect
at any time to assume, and thereafter conduct, the defense of the
Indemnification Claim with counsel of the Indemnitor’s choice reasonably
satisfactory to the Indemnified Party; provided, however, that the Indemnitor
will not approve of the entry of any judgment or enter into any settlement with
respect to the Indemnification Claim without the Indemnified Party’s prior
written approval (which must not be withheld unreasonably). Until an Indemnitor
assumes the defense of the Indemnification Claim, the Indemnified Party may
defend against the Indemnification Claim in any manner the Indemnified Party
reasonably deems appropriate. If the Indemnified Party gives an Indemnitor
notice of an Indemnification Claim and the Indemnitor does not, within ten
(10) days after such notice is given, give notice to the Indemnified Party of
its election to assume the defense of such Indemnification Claim and thereafter
promptly assume such defense, then the Indemnitor will be bound by any judicial
determination made with respect to such Indemnification Claim or any compromise
or settlement of such Indemnification Claim effected by the Indemnified Party.
 
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5.5 Limitations on Indemnification Liability. Any claims an Indemnified Party
makes under this ARTICLE 5 will be limited as follows:
(a) Ceiling. The aggregate liability for monetary Damages of the Buyer Parties,
on the one hand, and Seller, on the other, under this Agreement related to
breaches of the representations, warranties and covenants herein will not exceed
an amount equal to the Purchase Price, provided, however, that the limitation
contemplated hereby will not be applicable with respect to (i) breaches of
Sections 2.1, 2.2, 3.1 or 3.2 or ARTICLE 4, (ii) instances of fraud,
(iii) liabilities the Buyer Parties may incur with respect to Excluded Assets or
Excluded Liabilities or (iv) liabilities Seller may incur with respect to the
Assumed Liabilities.
(b) Basket/Threshold. The Buyer Parties, on the one hand, and Seller, on the
other, will have no liability for monetary Damages related to breaches of the
representations and warranties in ARTICLE 2 (with respect to the Buyer Parties)
or ARTICLE 3 (with respect to Seller), unless and until the aggregate Damages
related thereto exceed ten percent (10%) of the Purchase Price (as expressed in
a dollar amount); provided, however, that, if the aggregate Damages related
thereto of the Buyer Parties, on the one hand, or Seller, on the other, exceeds
such amount, the Indemnitor’s liability will relate back to, and include, the
first dollar of such aggregate Damages. If Damages arise as Excluded Liabilities
or Assumed Liabilities and also as a result of breaches of a Party’s
representations and warranties under ARTICLE 2 or ARTICLE 3, such Damages will
be deemed to be Excluded Liabilities or Assumed Liabilities, as applicable, and
will not be subject to the limits of this Section 5.5(b).
5.6 Negligence of Another Person. ANY PARTY’S LIABILITY UNDER THIS AGREEMENT
WILL NOT BE NEGATED BY ANY OTHER PERSON’S ALLEGED OR PROVEN SOLE, JOINT OR
CONTRIBUTORY NEGLIGENCE.
5.7 Indemnification for Non—Compliance with Bulk Sales Statute. The Buyer
Parties acknowledge that Seller will not comply with any bulk transfer Laws of
any jurisdiction in connection with the Transactions. Seller will indemnify the
Buyer Parties for any Damages resulting from, or relating to, such
non-compliance and Section 5.5 will not apply to Damages incurred as a result
thereof.
ARTICLE 6
MISCELLANEOUS
6.1 Entire Agreement. This Agreement, together with the other Transaction
Documents and all schedules, exhibits, annexes or other attachments hereto or
thereto, and the certificates, documents, instruments and writings that are
delivered pursuant hereto or thereto, constitutes the entire agreement and
understanding of the Parties in respect of the subject matter hereof and
supersede all prior understandings, agreements or representations by or among
the Parties, written or oral, to the extent they relate in any way to the
subject matter hereof. Except as provided in ARTICLE 5, there are no third party
beneficiaries having rights under or with respect to this Agreement.
6.2 Assignment; Binding Effect. No Party other than Buyer may assign either this
Agreement or any of its rights, interests or obligations hereunder without the
prior written approval of the other Parties, and any such assignment by a Party
without prior written approval of the other Parties will be deemed invalid and
not binding on such other Parties. All of the terms, agreements, covenants,
representations, warranties and conditions of this Agreement are binding upon,
inure to the benefit of and are enforceable by, the Parties and their respective
successors and permitted assigns.
 
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6.3 Joint and Several Obligations. Notwithstanding anything to the contrary in
this Agreement, the covenants and obligations of, and the representations and
warranties made by or attributable to, any Buyer Party pursuant to this
Agreement will be deemed to be made by, and attributable to, each Buyer Party,
jointly and severally, and Seller will have the right to pursue remedies against
any one or more Buyer Parties without any obligation to give notice to or to
pursue all Buyer Parties, or to give notice to or pursue any individual Buyer
Party, before pursuing any other Buyer Party.
6.4 Notices. All notices, requests and other communications provided for, or
permitted to be given, under this Agreement must be in writing and must be given
by personal delivery, by certified or registered United States mail (postage
prepaid, return receipt requested), by a nationally recognized overnight
delivery service for next day delivery, or by facsimile transmission, to the
intended recipient at the address set forth for the recipient on the signature
page hereto (or to such other address as any Party may give in a notice given in
accordance with the provisions hereof). All notices, requests or other
communications will be effective and deemed given only as follows: (i) if given
by personal delivery, upon such personal delivery, (ii) if sent by certified or
registered mail, on the fifth (5th) business day after being deposited in the
United States mail, (iii) if sent for next day delivery by overnight delivery
service, on the date of delivery as confirmed by written confirmation of
delivery or (iv) if sent by facsimile, upon the transmitter’s confirmation of
receipt of such facsimile transmission, except that if such confirmation is
received after 5:00 p.m. (in the recipient’s time zone) on a business day, or is
received on a day that is not a business day, then such notice, request or
communication will not be deemed effective or given until the next succeeding
business day. Notices, requests and other communications sent in any other
manner, including by electronic mail, will not be effective.
6.5 Specific Performance; Remedies. Each Party acknowledges and agrees that the
other Parties would be damaged irreparably if any provision of this Agreement
were not performed in accordance with its specific terms or were otherwise
breached. Accordingly, the Parties will be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement and to
enforce specifically this Agreement and its provisions in any action or
proceeding instituted in any state or federal court sitting in Dallas County,
Texas having jurisdiction over the Parties and the matter, in addition to any
other remedy to which they may be entitled, at law or in equity. Except as
expressly provided herein, the rights, obligations and remedies created by this
Agreement are cumulative and in addition to any other rights, obligations or
remedies otherwise available at law or in equity. Nothing herein will be
considered an election of remedies.
6.6 Headings. The article and section headings contained in this Agreement are
inserted for convenience only and will not affect in any way the meaning or
interpretation of this Agreement.
6.7 Governing Law. THIS AGREEMENT WILL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW PRINCIPLES.
 
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6.8 Amendment; Extensions; Waivers. No amendment, modification, waiver,
replacement, termination or cancellation of any provision of this Agreement will
be valid, unless the same is in writing and signed by Buyer, Seller and
Immediatek. Each waiver of a right hereunder does not extend beyond the specific
event or circumstance giving rise to the right. No waiver by any Party of any
default, misrepresentation or breach of warranty or covenant hereunder, whether
intentional or not, may be deemed to extend to any prior or subsequent default,
misrepresentation or breach of warranty or covenant hereunder or affect in any
way any rights arising because of any prior or subsequent such occurrence.
Neither the failure nor any delay on the part of any Party to exercise any right
or remedy under this Agreement will operate as a waiver thereof, nor does any
single or partial exercise of any right or remedy preclude any other or further
exercise of the same or of any other right or remedy.
6.9 Severability. The provisions of this Agreement will be deemed severable and
the invalidity or unenforceability of any provision will not affect the validity
or enforceability of the other provisions hereof; provided, however, that if any
provision of this Agreement, as applied to any Party or to any circumstance, is
judicially determined not to be enforceable in accordance with its terms, the
Parties agree that the court judicially making such determination may modify the
provision in a manner consistent with its objectives such that it is
enforceable, and/or to delete specific words or phrases, and in its modified
form, such provision will then be enforceable and will be enforced.
6.10 Expenses. Except as otherwise expressly provided in this Agreement, each
Party will bear its own costs and expenses incurred in connection with the
preparation, execution and performance of this Agreement and the Transactions,
including all fees and expenses of agents, representatives, financial advisors,
legal counsel and accountants.
6.11 Counterparts; Effectiveness. This Agreement may be executed in any number
of counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument. This Agreement will become
effective when one or more counterparts have been signed by each Party and
delivered to the other Parties.
6.12 Construction. This Agreement has been freely and fairly negotiated among
the Parties. If an ambiguity or question of intent or interpretation arises,
this Agreement will be construed as if drafted jointly by the Parties and no
presumption or burden of proof will arise favoring or disfavoring any Party
because of the authorship of any provision of this Agreement. Any reference to
any law also will be deemed to refer to such law as amended and all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
words “include,” “includes,” and “including” will be deemed to be followed by
“without limitation.” The word “person” includes individuals, entities and
Governmental Bodies. Pronouns in masculine, feminine and neuter genders will be
construed to include any other gender, and words in the singular form will be
construed to include the plural and vice versa, unless the context otherwise
requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,”
and words of similar import refer to this Agreement as a whole and not to any
particular subdivision, unless expressly so limited. The Parties intend that
each representation, warranty and covenant contained herein will have
independent significance. If any Party has breached any representation, warranty
or covenant contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the same subject matter
(regardless of the relative levels of specificity) that the Party has not
breached will not detract from or mitigate the fact that the Party is in breach
of the first representation, warranty or covenant.
 
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6.13 Schedules. The disclosures in the Schedules, and those in any supplement
thereto, relate only to the representations and warranties in the section or
paragraph of the Agreement to which they expressly relate and not to any other
representation or warranty in this Agreement. If there is any inconsistency
between the statements in the body of this Agreement and those in the Schedules
(other than an exception expressly set forth in the Schedules with respect to a
specifically identified representation or warranty), the statements in the body
of this Agreement will control. Nothing in the Schedules will be deemed adequate
to disclose an exception to a representation or warranty made herein, unless the
Schedules identify the exception with reasonable particularity and describe the
relevant facts in reasonable detail. The mere listing (or inclusion of a copy)
of a document or other item in a Schedule will not be deemed adequate to
disclose an exception to a representation or warranty made in this Agreement
(unless the representation or warranty pertains to the existence of the document
or other item itself).
SIGNATURE PAGES FOLLOW
 
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SIGNATURE PAGE
TO
ASSET PURCHASE AGREEMENT
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of
the date stated in the introductory paragraph of this Agreement.

                          BUYER:
 
                Address:   320 South Walton   IMKI Ventures, Inc.,     Dallas,
Texas 75226   a Delaware corporation
 
  Attn: President            
 
  Fax: (214) 744-8811                     By:   /s/ DARIN DIVINIA              
        Name:   Darin Divinia         Title:   President & Chief Executive
Officer
 
                        IMMEDIATEK:
 
                Address:   320 South Walton   Immediatek, Inc.,     Dallas,
Texas 75226   a Nevada corporation
 
  Attn: President            
 
  Fax: (214) 744-8811                     By:   /s/ DARIN DIVINIA              
        Name:   Darin Divinia         Title:   President & Chief Executive
Officer
 
                        SELLER:
 
                Address:   c/o Radical Management, LLC   Radical Holdings LP,  
  5424 Deloache Avenue   a Texas limited partnership
 
  Dallas, Texas 75220                 Attn: President   By:   Radical
Management, LLC,
a Texas limited liability company,
its general partner
 
                With a copy (which shall not constitute notice):       By:   /s/
MARTIN WOODALL
 
               
 
          Name:   Martin Woodall
 
  Robert S. Hart, Esq.       Title:   Vice President
 
  5424 Deloache Avenue            
 
  Dallas, Texas 75220            
 
  Fax: (214) 696-3380            

 
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SCHEDULES
TO
ASSET PURCHASE AGREEMENT
Intentionally omitted.
 
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