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ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement ("Agreement") is entered into as of January 15, 2025 (the "Effective Date"), by and between:

SELLER:
TechStart Innovations LLC, a Delaware limited liability company, with principal offices at 1200 Technology Park Drive, Suite 400, San Jose, California 95110 ("Seller"),

and

BUYER:
Enterprise Solutions Corp., a Delaware corporation, with principal offices at 8500 Corporate Boulevard, Building C, Boston, Massachusetts 02101 ("Buyer").

RECI

{
  "document_type": "purchase_agreement",
  "agreement_type": "asset_purchase",
  "effective_date": "2025-01-15",
  "parties": {
    "seller": {
      "name": "TechStart Innovations LLC",
      "type": "llc",
      "address": "1200 Technology Park Drive, Suite 400, San Jose, California 95110"
    },
    "buyer": {
      "name": "Enterprise Solutions Corp.",
      "type": "corporation",
      "address": "8500 Corporate Boulevard, Building C, Boston, Massachusetts 02101"
    }
  },
  "assets_purchased": {
    "description": "Substantially all assets used in the enterprise software solutions business for customer relationship management",
    "included_assets": [
      "Intellectual property rights including software code, patents (Patent No. US 10,123,456), trademarks (TechStart CRM), trade secrets, and copyrights",
      "Customer contracts and customer data (approximately 850 active enterprise accounts)",
      "Equipment, computers, servers, and tangible personal property",
      "Inventory including software licenses and support credits",
      "Accounts receivable outstanding as of Closing Date",
      "Permits, licenses, and governmental authorizations",
      "Goodwill associated with the Business"
    ],
    "excluded_assets": [
      "Cash and cash equivalents",
      "Tax refunds and credits",
      "Corporate name TechStart Innovations LLC and organizational documents",
      "Employee benefit plans and related assets",
      "Insurance policies and related claims"
    ],
    "assumed_liabilities": [
      "Obligations under customer contracts arising after Closing Date",
      "Trade payables and accrued expenses up to $500,000",
      "Obligations under assumed equipment leases"
    ],
    "excluded_liabilities": [
      "Liabilities from events prior to Closing Date",
      "Indebtedness for borrowed money",
      "Liabilities relating to excluded assets",
      "Employment liabilities including severance",
      "Environmental liabilities",
      "Product liability claims from pre-Closing sales"
    ]
  },
  "purchase_price": {
    "total_price": "$45,000,000",
    "allocation": "Intellectual Property: $25,000,000; Customer Contracts and Goodwill: $12,000,000; Equipment and Inventory: $5,000,000; Accounts Receivable: $3,000,000",
    "earnout": {
      "applicable": true,
      "structure": "15% of Net Revenue from the Business exceeding $20,000,000 in each of the first two years following Closing",
      "maximum": "$8,000,000",
      "period": "Two years following Closing"
    },
    "adjustments": {
      "working_capital": true,
      "target": "$2,500,000",
      "mechanism": "Within 90 days after Closing, Buyer prepares Net Working Capital statement. If exceeds Target by more than $100,000, Buyer pays Seller excess. If below Target by more than $100,000, Seller pays Buyer deficiency."
    }
  },
  "payment_terms": {
    "cash_at_closing": "$38,000,000",
    "seller_financing": {
      "applicable": true,
      "amount": "$2,500,000",
      "interest_rate": "6.5% per annum, compounded annually",
      "term": "Three years from Closing Date with equal quarterly payments; prepayment without penalty after first year"
    },
    "escrow": {
      "amount": "$4,500,000 (10% of Purchase Price)",
      "term": "18 months from Closing",
      "release_conditions": "Released to Seller 18 months after Closing, less amounts subject to pending or resolved indemnification claims"
    }
  },
  "closing": {
    "closing_date": "2025-03-01",
    "closing_conditions": [
      "Representations and warranties true and correct in all material respects",
      "Performance of all covenants required prior to Closing",
      "No Material Adverse Effect",
      "Receipt of required third-party consents",
      "Receipt of required governmental approvals"
    ],
    "buyer_conditions": [
      "Seller representations and warranties true and correct",
      "Seller has performed all pre-Closing covenants",
      "No Material Adverse Effect has occurred",
      "Consents from customers representing at least 80% of annual recurring revenue",
      "Required governmental approvals obtained",
      "Completion of satisfactory due diligence"
    ],
    "seller_conditions": [
      "Buyer representations and warranties true and correct",
      "Buyer has performed all pre-Closing covenants",
      "Buyer has delivered Closing payment and executed all required documents"
    ],
    "termination_rights": "Either party may terminate by written notice if Closing has not occurred by April 30, 2025 (Outside Date), provided terminating party is not in material breach"
  },
  "representations_warranties": {
    "seller_reps": [
      "Organization and Authority",
      "Title to Assets",
      "Intellectual Property ownership with no infringement claims",
      "Material contracts valid and in force",
      "Financial statements fairly present financial condition",
      "No pending or threatened litigation",
      "Compliance with Laws",
      "Taxes properly filed and paid",
      "Employee matters comply with laws"
    ],
    "buyer_reps": [
      "Organization and Authority",
      "Financial Capability to consummate transaction",
      "No Conflicts with law or agreements"
    ],
    "survival_period": "18 months following Closing Date; Fundamental Representations (organization, authority, title) survive 3 years",
    "disclosure_schedules": true
  },
  "covenants": {
    "pre_closing": [
      "Conduct Business in ordinary course",
      "Maintain Purchased Assets in good condition",
      "Provide Buyer reasonable access to Business and records",
      "Use commercially reasonable efforts to preserve customer and employee relationships",
      "Not dispose of material assets outside ordinary course"
    ],
    "post_closing": [
      "Seller to provide transition assistance for up to 6 months",
      "Seller shall not disparage Buyer or the Business",
      "Buyer shall honor employee agreements assumed at Closing"
    ],
    "non_compete": {
      "present": true,
      "scope": "Seller and principals agree not to engage in any business competitive with the Business in North America; exception for passive investments less than 5% in public companies",
      "duration": "3 years from Closing Date"
    }
  },
  "indemnification": {
    "seller_indemnifies": "Breach of representations/warranties, breach of covenants, excluded liabilities, pre-Closing taxes",
    "buyer_indemnifies": "Breach of representations/warranties, breach of covenants, assumed liabilities",
    "basket": "$450,000 (tipping basket - first dollar liability once exceeded)",
    "cap": "$9,000,000 (20% of Purchase Price), excluding fraud",
    "survival": "18 months following Closing; Fundamental Representations 3 years; tax indemnification until expiration of applicable statutes of limitation"
  },
  "governing_law": "State of Delaware",
  "signatures": {
    "seller_signed": true,
    "buyer_signed": true,
    "date_signed": "2025-01-15"
  }
}