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EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") made this APRIL 22, 2014, by
and between NETWORKING PARTNERS, INC., a Nevada corporation, 857 Sarno Road,
Melbourne, Florida 32935 ("Purchaser") and CHAD STEINHART, an individual who's
registered address is located at 5044 North West 87th Terrace, Coral Springs, FL
33067 ("Seller").
RECITALS
WHEREAS, Chad Steinhart, as the Seller, is the developer and sole owner of
a proprietary integration code for web development and software for voice over
internet protocol ("VoIP") integration. This works together to form a total
solution resulting in an internet telephony service provider ("ITSP") platform
that allows hosted private branch exchange ("PBX") in the cloud and other
telecom features. This platform integrates several types of telecommunications
carrier grade class 4 and class 5 soft-witches from an open source framework by
Digium, Inc. to licensed software and equipment and infrastructure providers,
Telinta, Inc. and PortaOne, Inc. This allows the convergence around a carrier
grade billing platform including soft-switches as media applications for voice
and video calls, conferencing, interactive voice response ("IVR") applications
and unified messaging applications integrated into one simple web portal. This
integration is being purchased and allows the end using businesses that pay for
service to have a robust PBX phone system including phone lines hooked to the
Cloud. The integrations include the code, infrastructure and equipment allowing
the soft-switches and web development to operate in a simple interface that uses
the technology just mentioned and hosts the integration portal on the domains
www.SonantTelecon.com and www.SonantTelecom.net. This Agreement includes all the
code, web development integrations and an infrastructure to facilitate being an
ITSP. It also includes all of Seller's vendor relationships and the lists of
businesses that have utilized the technology on a test basis or are currently
using the technology on a trial basis and are willing to enter into formal
agreements to continue using the technology which will generate monthly residual
revenues to the owner. The following assets and development are to be included:
1) Please refer to Exhibit "A," attached hereto and incorporated herein
by reference, which includes a list and description of the assets and
development being sold pursuant to this Agreement ("Assets").
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:
SECTION 1. PURCHASE AND SALE
Upon the terms and subject to the conditions of this Agreement, the Seller
at the Closing (as hereinafter defined) hereby sells the above mentioned assets,
users and vendor relations to the Purchaser in consideration of $6,250,000,
payable by the Purchaser's issuance of 625,000 SHARES OF ITS SERIES "A"
CONVERTIBLE PREFERRED STOCK ("PREFERRED A SHARES"). EACH PREFERRED "A" SHARE
shall have 100 votes per share and shall be convertible into 100 shares of
Purchaser's common stock, such conversion right to be exercisable on or after
the second anniversary of the Closing (as hereinafter defined).
SECTION 2. EFFECTIVE DATE AND THE CLOSING
The closing of the purchase and sale of the Assets hereunder ("Closing")
shall occur on or before the fifth day following satisfactory completion of the
following events:
a) Filing by Network Partners, Inc. of its Form 10-Q Quarterly Report for
the fiscal quarter ended September 30, 2013, and the filing of its
Form 10-K Annual Report for the fiscal year ended December 31, 2013,
which shall necessarily include audited financial statements for the
fiscal years ended December 31, 2013 and 2012, with the Securities and
Exchange Commission.
b) Seller shall have delivered to the Purchaser a market valuation report
of the Assets, such report to be prepared by a mutually agreed upon
non-affiliated third party expert, and accepted by the Purchaser as
satisfactory evidence of the value of the Assets.
In the event that the Preferred "A" Shares are not delivered to Seller with
90 days from the Closing, this transaction shall be null and void.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to the Purchaser as follows:
3.1 DUE AUTHORITY. Seller has all power and authority necessary to enable
it to carry out the transactions contemplated by this Agreement. This Agreement
is a valid and binding agreement of the Seller, enforceable against the Seller
in accordance with its terms.
3.2 NO CONSENTS. No authorizations, approvals or consents are required to
permit the Seller to fulfill all of its obligations under this Agreement.
3.4 NO BREACH. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not (i)
violate, conflict with or result in the breach of any of the terms of, result in
a material modification of, otherwise give any other contracting party the right
to terminate, or constitute (or with notice or lapse of time or both) a default
under any contract or other agreement to which the Seller is a party or the
Assets are subject; (iii) violate any order, judgment, injunction, award or
decree of any court, arbitrator or governmental or regulatory body against, or
binding upon Seller, or upon the properties or business of the Seller; or (iv)
violate any statute, law or regulation of any jurisdiction applicable to the
Seller.
3.5 OWNERSHIP OF THE WEB DEVELOPMENT INTEGRATION TECHNOLOGY. The Seller is
the developer and sole owner of the Assets, including, but not limited to, a
proprietary integration code for web development and software for voice over
internet protocol (VoIP) integration. This works together to form a total
solution resulting in an Internet Telephony Service Provider (ITSP) platform
that allows hosted PBX in the cloud and other telecom features. This platform
integrates several types of telecommunications carrier grade class 4 and class 5
soft-switches from; an open source framework by Digium, Inc. to licensed
software and equipment and infrastructure providers Telinta, Inc. and PortaOne,
Inc. This allows the convergence around a carrier grade billing platform
including soft-switches as media applications for voice and video calls,
conferencing, IVR applications and unified messaging applications resulting in
the integration into one simple web portal. This integration is being purchased
and allows the end using businesses which pay for service to have a robust PBX
phone system including phone lines hooked to the Cloud. The integrations include
the code, infrastructure and equipment allowing the soft-switches and web
development to operate in a simple interface which uses the technology just
mentioned and hosts the integration portal on the domains www.SonantTelecon.com
and www.SonantTelecom.net. The purchase agreement includes all the code, web
development integrations and an infrastructure to facilitate being an ITSP. It
also includes all its vendor relationships and the lists of businesses that have
utilized the technology on a test basis or are currently using the technology on
a trial basis and are willing to enter into formal agreements to continue using
the technology which will generate monthly residual revenues to the owner. The
assets and development being sold hereunder by the Seller to the Purchaser are
described on Exhibit "A" attached hereto and incorporated herein by reference.
The Seller is not a party to any agreement, written or oral, creating
rights in respect to the integration technology code and web development
integration and the websites that use this technology as of the date of
execution of this contact.
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SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to the Seller as follows:
4.1 POWER OF PURCHASER. The Purchaser has the full legal right and power
and all authority and approval required to enter into, execute and deliver this
Agreement and to perform fully its obligations hereunder.
4.2 DUE AUTHORITY. The Purchaser has all power and authority necessary to
enable it to carry out the transactions contemplated by this Agreement. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated by it have been authorized by all necessary action on
the part of Purchaser. This Agreement is a valid and binding agreement of
Purchaser, enforceable against Purchaser in accordance with its terms. Neither
the execution and delivery of this Agreement by Purchaser nor the consummation
of the transactions contemplated by this Agreement will violate, result In a
breach of, or constitute a default under, any agreement or instrument to which
Purchaser is a party or by which Purchaser is bound, or any order, rule or
regulation of any court or governmental agency having jurisdiction over
Purchaser.
4.3 NO CONSENTS. No authorizations, approvals or consents are required to
permit the Purchaser to fulfill its obligations under this Agreement.
4.4 NO BREACH. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not (i)
violate, conflict with or result in the breach of any of the terms of, result in
a material modification of, otherwise give any other contracting party the right
to terminate, or constitute (or with notice or lapse of time or both) a default
under any contract or other agreement to which Purchaser is a party; (ii)
violate any order, judgment, injunction, award or decree of any court,
arbitrator or governmental or regulatory body against, or binding upon
Purchaser, or upon the properties or business of Purchaser; or (iii) violate any
statute, law or regulation of any jurisdiction applicable to Purchaser.
SECTION 5. COVENANTS
5.1 Noncompetition Covenant. Seller covenants and agrees that neither the
Seller nor any of the Seller's immediate family members or other affiliates will
directly or indirectly for a three (3) year period following the Closing compete
with the Purchaser or accept employment or otherwise engage anywhere in the
development, management or ownership of any business that would or could compete
with (i) the Purchaser's business after the Assets are acquired by the Purchaser
or (ii) the Purchaser's use, ownership and exploitation of the Assets.
Seller acknowledges that this covenant not to compete is a critical term
and consideration for this Agreement without which Purchaser would not acquire
the Seller's Assets. Therefore, upon breach of any provision of this Section 5,
Purchaser will be entitled to injunctive relief, since the remedy at law would
be inadequate and insufficient, and the Purchaser will be entitled to such
monetary damages as it can show it has sustained because of such breach.
If any provision of this Section 5 is held to be unenforceable because of
the duration of such provision or the area covered hereby, the parties agree
that the court making such determination will have the power to reduce the
duration and/or area of such provision, and/or to delete specific words or
phrases, and in its reduced form such provision will then be enforceable and
will be enforced.
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SECTION 6. INDEMNITY
6.1 INDEMNIFICATION PROCEDURE. A party (an "Indemnified Party") seeking
indemnification shall give prompt notice to the other party (the "Indemnifying
Party") of any claim for indemnification arising under this Section 6. The
Indemnifying Party shall have the right to assume and to control the defense of
any such claim with counsel reasonably acceptable to such Indemnified Party, at
the Indemnifying Party's own cost and expense, including the cost and expense of
reasonable attorneys' fees and disbursements in connection with such defense, in
which event the Indemnifying Party shall not be obligated to pay the fees and
disbursements of separate counsel for such in such action.
In the event, however, that such Indemnified Party's legal counsel shall
determine that defenses may be available to such Indemnified Party that are
different from or in addition to those available to the Indemnifying Party, in
that there could reasonably be expected to be a conflict of interest if such
Indemnifying Party and the Indemnified Party have common counsel in any such
proceeding, or if the Indemnified Party has not assumed the defense of the
action or proceedings, then such Indemnifying Party may employ separate counsel
to represent or defend such Indemnified Party, and the Indemnifying Party shall
pay the reasonable fees and disbursements of counsel for such Indemnified Party.
No settlement of any such claim or payment in connection with any such
settlement shall be made without the prior consent of the Indemnifying Party
which consent shall not be unreasonably withheld.
SECTION 7. MISCELLANEOUS
7.1 NOTICES. Any notice or other communication required or which may given
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered, or
express mail, postage prepaid, and shall be deemed given when so delivered
personally, telegraphed, telexed or sent by facsimile transmission or if mailed,
four (4) days after the date of mailing, as follows:
IF TO THE SELLER:
Chad Steinhart,
5044 North West 87th Terrace,
Coral Springs, FL 33067.
IF TO THE PURCHASER:
Networking Partners Inc,
857 Sarno Road,
Melbourne, FL 32935.
WITH COPY TO:
David E. Wise, Esq.
The Colonnade
9901 IH-10 West, Suite 800
San Antonio, Texas 78230.
Any party may by notice given in accordance with this Section to the other
parties designate another address or person for receipt of notice hereunder.
7.2 ENTIRE AGREEMENT. This Agreement and any collateral agreement executed
in connection with the consummation of the transactions contemplated herein
contain the entire agreement among the parties with respect to the subject
matter hereof and related transactions, and supersede all prior agreements,
written or oral, with respect thereto.
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7.3 WAIVERS AND AMENDMENTS. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the parties or, in the
case of a waiver, by the party waiving compliance.
7.4 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Nevada and jurisdiction shall be in the
State of Florida.
7.5 HEADINGS. The headings in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.
7.6 SEVERABILITY. If any term or provision of this Agreement, or the
application thereof to any person or circumstance shall, to any extent, be
determined by a court of competent jurisdiction to be invalid or unenforceable,
the remainder of this Agreement or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement shall be valid and enforced to the fullest extent permitted by
law.
7.7 SURVIVAL OF REPRESENTATIONS AND INDEMNIFICATION.
All statements contained in any Exhibit, Schedule, document, certificate or
other instrument delivered by or on behalf of any party hereto, or in connection
with the transactions contemplated hereby, shall be deemed to be representations
and warranties made pursuant to this Agreement by such party along with the
representations and warranties made pursuant to this Agreement, and the
provisions of, and obligations of the Seller, contained in Section 5 hereof,
shall survive the consummation of the transactions contemplated by this
Agreement and the investigations made by or on behalf of any of the parties.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
SELLER:
Chad Steinhart, an individual
/s/ Chad Steinhart
-----------------------------------
Chad Steinhart - Owner
April 22, 2014
PURCHASER:
Networking Partners, Inc.
/s/ Enzo Taddei
-----------------------------------
Enzo Taddei
Chief Executive Officer
April 22, 2014
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EXHIBIT "A"
1. The name, reputation and ownership of the domain www.SonantTelecom.com and
www.SonantTelecom.net.
2. The Logo attached to the domain www.SonantTelecom.com "Sonant from
Consonant. Meaning as of sound.
3. Ownership of the domain www.CallPerformanceMetrics.com.
4. Ownership of the domain www.LeadInfoPortal.com.
5. Rights to the Facebook fan page www.Facebook.com/SonantTelecom.
6. Rights to the twitter account for Sonant Telecom.
7. Search engine optimization work behind www.SonantTelecom.com and its
placement.
8. Rights for the LinkedIn Account of Sonant Telecom and Chad Steinhart which
promotes the integration.
9. Proprietary software code that is solely owned by Chad Steinhart that
integrates and combines the different platforms to create an ITSP.
10. Relationship and people or companies that use the web development portal
created by Chad Steinhart that generates monthly reoccurring revenue for
telecommunication services to Chad Steinhart.
11. Relationships established that allow for the integration to make the
technology work including vendors, hosting, datacenters, VoIP
telecommunications providers, merchant service gateways, merchant provider
and/or bandwidth providers.
12. Integration of the portal to Telintas PortaOne soft-switches which include
both front end web development and back end portal design.
13. Front End Web Design for Sonant Telecom which includes: Integration with
Authorize.net payment gateway, Shopping Cart and Client Portal Entrance
allows admin and user login.
14. Front End Integration with back end CMS admin that controls integrations:
Allows complete control of Front End content, allows Choice of
telecommunications products within Telinta's Telecore, PortaOne's
PortaSwitch Procinctus platform and integration with ITSP Vendors to
provide termination and origination of both inbound and outbound calling.
15. Unique Integrations with vendors to allow quick provisioning of VoIP
Telephone lines and PBX functionality. This proprietary integration allows
a reduction of working staff to support the business: This includes
integration and relationship with 19 Engineers who monitor and develop
around the clock to maintain 100% uptime guarantee. The highest uptime in
the industry today. Around-the-clock access to experienced technical staff
24/7/365.
/s/ Enzo Taddei /s/ Chad Steinhart
------------------------------ ------------------------------
Enzo Taddei Chad Steinhart
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16. Access to the Ukrainian development team which are now paid per maintenance
and per new development and no longer permanent staffing which cuts costs.
Unique integration to allow for CMS of any type of investor information.
Unique integration to allow approval system for accredited investors so
only approved can see pertinent information.
17. Administrative Customer Relationship Management (CRM) for possible
investors and approval investors system to see offering documentation.
18. Unique trouble management system or Ticket management system (TMS)
19. Unique checkout cart integration with PortoOne's billing platform,
authorize.net integration and Citibank Merchant Services.
20. PCI compliance with Citibank to allow web credit card information to be
secure when transmitted.
21. Integration of Databases with Telintas and PortaOne to allow or create
daily backups of all servers and billing data. This state-of-the-art unique
offsite backup process replicates the data created daily and then safeguard
it in multiple locations using cloud technologies.
22. Proprietary integration with Telinta;s Telecor and Procinctus Platform
which allows communication between Sonant's backend interface and Telinta's
Telecor which infrastructure consists of 36 servers with PortaOne licenses
allowing the environments to have triple redundancy. This integration
programmed in Cake PHP utilizes SOAP and POST / GET integrates Sonant's web
portal and controls the equipment which allows the Sonant system to perform
the ITSP function that it's capable of.
23. Customer portal allowing control of their own hosted PBX environment which
allows web integration with Telinta's Telecore and PortaOne's Procinctus
Platform allowing the layperson to monitor and control their business class
phone system in a simple user friendly manner.
24. Setup of all telecom products in Telinta PortaOne Procintus Platform. This
includes the programming of wholesale VoIP dollar loads, programming of the
product of predictive dialer licenses, programming of call groups,
programming allowing charges for call recording, programming to allow for
call queues, programming to allow for conference rooms and charges,
programming for telecom inbound trunks and toll free inbound trunks,
programming for International long distance services, programming allowing
predictive dialers, programming allowing for charging for seat lease for
dialers, programming for charging for long distance charges for predictive
dialers at different rates, programming for geographic phone lines and
charges, programming for allowing to charge for Pay Per Call at different
increments, programming for unlimited inbound and outbound phone calls and
its monthly residual charges, programing for metered phone lines and their
charges, programming for time clock for employees, programming for auto
attendants and their charges, programming for inbound and outbound fax
solutions and its charges, programming for international long distance and
the rates that are associated with calling to different areas, programming
for voice mailboxes and its charges.
/s/ Enzo Taddei /s/ Chad Steinhart
------------------------------ ------------------------------
Enzo Taddei Chad Steinhart
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25. Programming system to allow for both Prepaid and postpaid VoIP billing,
allowing real-time CDRs and call metrics, to allow complete wholesale
solutions as well as retail soft-switch solutions that give comprehensive
reports. System will give real-time analysis of calls and call logs. System
is highly customizable for future programming needs and allows for
multi-language users in its separate administrative web portal and allows
for custom IVR programming. The system will allow calculations in
multiple-currency for billing in different geographic areas and has an
Auto-fetch current Exchange Rates algorithm to get current exchange rates.
The system has the ability to do flexible call routing (LCR, Priority
based, fail-over, adaptive). System will allow integration with many
different payment providers and gateways to allow credit card and PayPal
payments. System will allow customized invoices for each person who uses
the system as an ITSP. System programmed to allow for NAT Traversal which
is completely support. Entire system set to be CODEC transparent to allow
quickest navigation and lowest latency. System allows transparent H-323 and
SIP protocol conversion and logs. System can be set for voice VPN (Virtual
Private Network) options to allow in areas where VoIP cannot be transverse.
System is not closed end and will allow full XML SOAP API integrations in
the future.
26. Coding and integration to Telicor and Portaone to allow telephone line
provisioning less than one minute.
27. Proprietary web integration and development of Call Performance Metrics
Dashboard.
28. Proprietary web integration and development of Call Switchboard.
29. Full diagnostic guide and support system included to trouble shoot
problems.
30. Plus any and all related assets, including trade secrets, intellectual
property, drawings, engineering plans, etc. necessary for the Purchaser to
access, exploit and market the Assets and their derivative businesses and
income streams.
WHEREAS, the Purchaser represents that the following assets acquired have
been acknowledged partially completed and are also included with the sale for
purchase for future development and rollout:
* Web development of proprietary Call Metrics Dashboard for Call
Performance Marketing that will be released in Asia to be the only one
of its kind with no competition in the area.
* Partial code and developmental stage of a smartphone softphone
application for both IPhone and Android.
* Preliminary drawings and design of a dual sim card system for IPhone
and Android that will allow banding and bonding of bandwidth
aggregation.
* Preliminary code for the development of the bonding bandwidth
application.
* Partial code and development and integration of front end website with
backend portal redesign to allow it to be responsive and be updated.
/s/ Enzo Taddei /s/ Chad Steinhart
------------------------------ ------------------------------
Enzo Taddei Chad Steinhart
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WHEREAS, the Seller represents that the following assets acquired are
complementary to the Purchaser and included in the sale:
* The domain www.SonantTelecom.com and www.SonantTelecom.net.
* The Social Media surrounding Sonant Telecom.
* Search Engine Optimization of the above domains and social media.
* Predictive dialer integrated for licensing for large call centers.
* Proprietary code and development of system nicknamed "Caller ID
Thingy", (CIT for short) allowed call centers to dial into an area
code using a caller id belonging to that area code by automatically
purchasing the DID before it dialed into the called specific area
code.
/s/ Enzo Taddei /s/ Chad Steinhart
------------------------------ ------------------------------
Enzo Taddei Chad Steinhart
