ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this “Agreement”) is entered into as of February 6, 2006, by and between DAG Media, Inc., a New York corporation (“Seller”), and DAG-Jewish Directories, Inc., a New York corporation (“Buyer”). Buyer and Seller are collectively referred to as the “Parties” or individually as a “Party”.
WHEREAS, Seller is a publicly traded corporation engaged in the business of creating, publishing and distributing yellow pages classified business telephone Directories Business known as “The Jewish Israeli Yellow Pages” and “The Jewish Master Guide” (aka “The Kosher Yellow Pages”) and related Web site and referral service (“Directories Business”); and
WHEREAS, Buyer is a corporation founded by a group of sales agents and investors engaged in the business of promoting and selling, on behalf of Seller and in Seller’s name, listings and advertising spaces in the Directories Business; and
WHEREAS, Seller desires to sell, transfer and assign to Buyer, and Buyer desires to purchase from Seller all of the identified below assets (“Purchased Assets”) used by Seller in connection with the conduct and operation of its Directories Business and subject to the assumption by Buyer of certain liabilities of Seller as defined;
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the Parties hereto agree as follows:
PURCHASE AND SALE OF ASSETS
1.1 Conditional Sale of Assets. Upon the terms and subject to the conditions set forth in this Agreement and the performance by the Parties hereto of their respective obligations hereunder, Seller agrees to sell, assign, transfer and deliver to Buyer, and Buyer agrees to purchase from Seller, Seller’s right, title and interest in and to the properties and assets of Seller used in the Directories Business, including the following (collectively the “Purchased Assets”):
(a) All tangible assets including but not limited to furniture and fixtures, tools, machines, computers, software, assets, inventory, supplies, files, telephones, account receivable, account payables and office equipment as are set forth on Schedule 1;
(b) All trade names, domain names, trademarks, copyrights, trade secrets and any other intellectual property as are set forth on Schedule 2;
(c) All the intangible assets, such as software, literature, manuals, training materials, product brochures, business methods, procedures and customer lists of the Directories Business as are set forth on Schedule 3;
(d) All of Seller’s rights and obligations under contracts wherein Seller has agreed to provide products or services to any third party or under which any third party provides products, services, insurances, financing, real estate or equipment to Seller, and any leases for equipment, automobiles, land or buildings used by the Business (“Assumed Contracts”) as are set forth on Schedule 4; and
(e) All documents and information relating to the Directories Business, for the past five (5) years, including, without limitation, customer lists and all books and records relating to the operations of the Business.
1.2 All Assets. The Purchased Assets constitute all of the material assets and properties held for use by Seller to conduct the Directories Business as presently conducted.
1.3 Assumed Liabilities. (a) Buyer will accept and assume all liabilities and obligations of Seller related to the Directories Business, and any obligations or liabilities relating to the Purchased Assets, including, but not limited to, all liabilities set forth on the Balance Sheet of the Directories Business dated as of the Closing, the assumption of the performance of Seller’s obligations under the Assumed Contracts.
(b) Buyer will assume all pending and new litigations arising in the regular course of business, including all legal fees and related judgment obligations. Specifically Buyer will assume:
(i) All advertisers’ claims relating to their advertising on the Directories Business, including, without limitation, small claims court matters pending as of the date of Closing or new cases related to matters before or after the Closing.
(ii) The currently pending legal action of the Jewish Sephardic Yellow Pages against DAG Media in the U.S. District Court for the Eastern District Of New York. Assaf Ran, CEO of Seller, will use reasonable efforts to cooperate with Buyer on and after the Closing Date in furnishing information, evidence and testimony in connection with this action. Assaf Ran will lead the defense strategy and is authorized by Buyer and Seller to negotiate and make settlement agreement.