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EXHIBIT 6.7
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT ("Agreement") entered into as of this 24th day of
January, 2001, by and among InterGlobal Waste Management, Inc., a California
corporation, with its principal office at 000 Xxxxx Xxxxx, Xxxxxxxxx, XX 00000
("Buyer"), PolyCast Corporation, a Louisiana corporation (the "Company" or
"PolyCast"), with its principal office at 00000 Xxxxxxxx Xxxx, Xxx Xxxxxxx, XX
00000, and Xxxxx X. Xxxxxx ("Xxxxxx"), Xxxxx Xxxxxx South ("South"), Xxxx X.
Xxxxxx ("Xxxxxx"), Xxxxxx X. Xxxxx ("Xxxxx"), Xxxxx Xxxxx ("Xxxxx"), Xxxxx
Xxxxxxx ("Xxxxxxx"), Xxxxxxx Xxxxxxxx ("X. Xxxxxxxx"), Xxxxxx Xxxxxxxx ("X.
Xxxxxxxx") (collectively "Stockholders").
RECITALS
1. Stockholders have made oral representations to Buyer that they are
the owners, free and clear of all adverse claims, of all of the outstanding
shares of capital stock (the "Shares") of POLYCAST.
2. Stockholders are willing to transfer to Buyer all of the shares upon
the terms and conditions and for the consideration set forth below.
3. Buyer is willing, subject to those terms and conditions and for that
consideration, to acquire all of the Shares.
AGREEMENT
The parties agree:
1. Transfer of the Shares.
Subject to the terms and conditions set forth and upon the representations
and warranties made in this Agreement, at the date of closing (as that term is
defined in Section 6):
(a) Stockholders will transfer to Buyer all of the Shares, the exact
number of Shares to be transferred by each Stockholder to be as follows:
STOCKHOLDER NO. OF SHARES
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Xxxxx X. Xxxxxx 25,500
Xxxxx Xxxxxx South, Jr. 9,750
Xxxx X. Xxxxxx 9,750
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Xxxxxx X. Xxxxx 2,000
Xxxxx Xxxxx 1,500
Xxxxx Xxxxxxx 1,500
Xxxxxxx Xxxxxxxx 1,500
Xxxxxx Xxxxxxxx 1,500
TOTAL 53,000
(b) Buyer will issue and deliver to Stockholders share certificates for a
total number of shares of Common Stock of Buyer (the "Buyer Stock"), the exact
number of shares of Buyer Stock to be issued to each Shareholder to be
determined as follows:
(i) The total consideration to be paid by Buyer to Stockholders shall be
the sum of $300,000 (or $5.550337 per Share) in shares of Buyer Stock;
(ii) Each share of Buyer Stock shall be valued at $1.50;
(iii) In order to avoid the issuance of fractional shares of Buyer Stock,
the number of shares of Buyer Stock to be issued and delivered to the
Shareholders shall be the number obtained by dividing the total dollar value
attributable hereunder to all of the Shares owned by each Stockholder, by the
per share value of the Buyer Stock ($1.50), rounded up to the next whole number;
(iv) Accordingly, Stockholders will receive as consideration for the
transactions contemplated herein, Buyer Stock in the following amounts:
STOCKHOLDER SHARES OF BUYER STOCK
----------- ---------------------
Xxxxx X. Xxxxxx 96,220
Xxxxx Xxxxxx South, Jr. 36,800
Xxxx X. Xxxxxx 36,800
Xxxxxx X. Xxxxx 7,540
Xxxxx Xxxxx 5,660
Xxxxx Xxxxxxx 5,660
Xxxxxxx Xxxxxxxx 5,660
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Xxxxxx Xxxxxxxx 5,660
TOTAL 200,000
It is the intention of the Stockholders and Buyer that the
consideration paid in Buyer Stock shall constitute, insofar and to the
extent of such consideration, a tax free exchange of stock under
Internal Revenue Code Section 368(a)(1)(B).
2. Representations and Warranties of Stockholders.
Stockholders represent and warrant to, and agree with Buyer that, except
as set forth in Exhibit 2:
(a) The Company and each corporation named in Exhibit 1 (corporations whose
capital stock is wholly or majority owned by PolyCast and which are sometimes
collectively referred to in this Agreement as the Company) is and will be at the
date of closing a corporation duly incorporated and validly existing under the
laws of the state of its incorporation; is and will be at the date of closing in
good standing under the laws of the state of its incorporation and to the best
of the Stockholders' knowledge of any other state or jurisdiction where it does
intrastate business; to the best of the Stockholders' knowledge has and will
have at the date of closing all requisite corporate power and authority to own
its properties and carry on its business as now conducted; and has and will have
at the date of closing obtained all licenses, permits, or other authorizations,
and taken all actions, required by applicable law or governmental regulations in
connection with its business as now conducted.
(b) PolyCast has an authorized capital stock consisting solely of 100,000
shares of common stock, with no par value, of which 53,000 shares and no more
are presently issued and outstanding (there being also no shares which have
been issued but are held in the Company's treasury and are not outstanding).
(c) The Company does not own, directly or indirectly, a majority or
controlling interest in any corporation, business trust, joint stock company,
or other business organization or association, except the corporations named in
Exhibit 1 to this Agreement, each of which has an authorized capital stock,
outstanding shares of stock, and [a] stockholder[s] as set forth in Exhibit 1.
There are no outstanding rights, warrants, options, subscriptions, agreements,
or commitments giving anyone any right to require the Company to issue, sell or
transfer any capital stock or other securities. The Company is not a general
partner of any partnership or a party to any joint venture.
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(d) The shares of stock referred to in Exhibit 1 to this Agreement as
owned by the Company or a subsidiary of the Company are owned free and clear of
all liens, encumbrances, charges, and assessments.
(e) Financial statements of the Company consisting of unaudited balance
sheets as of December 31, 2000; unaudited statements of operations, changes in
stockholders' equity, and changes in financial position or cash flow for the
fiscal year ended on such dates; an unaudited balance sheet as of December 31,
2000 (the "Balance Sheet"); and unaudited statements of operations, changes in
stockholders' equity, and changes in financial position or cash flow for the
twelve-month period ended December 31, 2000 (all financial statements listed
above are referred to in this Agreement collectively as the "Financial
Statements") have been delivered to Buyer. The Financial Statements fully and
fairly set forth the financial condition of the Company as of the dates and the
results of its operations for the periods indicated in accordance with
generally accepted accounting principles consistently applied; and the Company
did not have at December 31, 2000 and shall not have at closing:
(i) Any obligations, commitments, or liabilities, contingent or otherwise,
whether for taxes or otherwise, which are not shown or provided for in the
Financial Statements, except obligations to perform, after that date, sales
contracts, supply contracts, purchase orders, and other commitments in each
case in amounts incurred only in the ordinary course of business;
(ii) Any continuing contract for the future purchase of materials,
supplies, or equipment (except for any such contract which can be terminated
without payment of any amount as a penalty or bonus) or any contract or
commitment for capital expenditures in excess of $10,000 in the aggregate or
any contract continuing over a period of more than one year from its date;
(iii) Any pension, retirement, deferred compensation, profit sharing,
bonus, retainer, consulting, welfare, or incentive compensation plan or
arrangement, or any contract, or any fringe or other benefits or arrangements,
of, with, or for any officer, director, employee, or any other person which
cannot be terminated within a period of 30 days and without payment of any
amount as a penalty, bonus, premium, or other compensation for such a
termination;
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(iv) Any written or oral contract with or commitment or liabilities to,
any labor organization or association of employees (and no negotiation with any
such organization or association and no attempt, plan, or threat to organize
the employees of the Company is pending or, to the best of Stockholders'
knowledge, after reasonable investigation, threatened or contemplated);
(v) Any litigation, legal action, arbitration, proceeding, demand, claim,
or investigation pending, or to the best of Stockholders' present knowledge
(after reasonable investigation), threatened or planned against the Company
which might adversely and materially affect its business or property or this
Agreement;
(vi) Any notes or accounts receivable which are not current and
collectible except for uncollectable items, counterclaims, or setoffs not in
excess of the reserves provided for such contingencies in the Financial
Statements as adjusted in the ordinary course of business to date; other than
any such items with a value of less than $2,500;
(vii) Any shortages existing in (A) any inventory or raw materials owned
by customers or others and stored upon the premises of the Company for use in
future orders of such customers or for other purposes except for shortages, if
any, not exceeding the normal allowance for scrap, production losses, and
materials consumed in process, or (B) any other items of personal property
owned by another for which the Company is accountable to another, other than
any such items with a collective value of less than $2,500.
(f) To the best of the Stockholders' knowledge the Balance Sheet contains
adequate provision for all federal income, accumulated earnings, or other
federal taxes and all state or local income, franchise, real property, personal
property, sales, withholding, and all other taxes imposed on the Company, or
its property or rights or payable by it or a lien on any of its property,
including interest and penalties, if any, in respect to such taxes, for the
period ended on that date and all fiscal periods prior to that date. The
Company has timely filed or will file all required federal, state, and local
tax returns (collectively, the "Tax Returns") and has paid all federal, state,
and local taxes (collectively, the "Taxes") reflected as due for all periods
ending on or before December 31, 2000. The Company has delivered to Buyer
copies of all Tax Returns filed with respect to tax years beginning after
December 31, 1996. All required Tax Returns, including amendments to date, have
been prepared in good faith without negligence or willful misrepresentation and
are complete and accurate in all material respects. The Company represents that
it has paid all taxes reflected on the returns. The Internal Revenue Service
has not examined the federal tax returns of the Company and State tax
authorities have not examined the state tax returns of the Company. No
deficiency in payment of any taxes for any period has been
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asserted by any taxing body and remains unsettled at the date of this Agreement
and all reports or returns required to be filed by the Company with any
federal, state, or local governmental body or authority have been properly
filed. Copies of federal and state income (or franchise) tax returns for the
last five tax years have been delivered to Buyer.
(g) Since the date of the Balance Sheet there has been no material adverse
change, or prospective change known to Managing Stockholders to be probable, in
the business, capitalization, financial condition, or properties of the Company
and the only material changes in the business, capitalization, financial
condition, or properties of the Company since that date are those arising from
the normal and regular conduct of its business, and no material loss, damage, or
destruction of its properties or business (whether or not covered by insurance)
has occurred since that date or is threatened or known to Stockholders (after
reasonable investigation) to be probable. The term "business," as used here and
elsewhere in this Agreement to refer to the business of the Company shall mean
any one or more significant aspects of its business, including, by way of
example and not limitation, costs (of labor or other services, materials, or
sales), backlog, manufacturing processes, products and rights to manufacture and
sell products, sales volume, sales mix, sales pricings, profit margins,
customers, or continuing ability to effect sales as in the past. As used herein
and hereafter, the term "Managing Stockholders" shall refer to the following
Stockholders only: Xxxxx X. Xxxxxx, Xxxxx Xxxxxx South, Jr., Xxxx X. Xxxxxx, and
Xxxxxx X. Xxxxx.
(h) Except as noted on Exhibit 2, the Company has not since the date of
the Balance Sheet, and will not on or prior to the date of closing, declare or
pay or make any payment of a dividend or other distribution to its shareholders
or purchase, redeem, or otherwise acquire or dispose of any share of its stock;
the Company will not, except in the ordinary course of business, pay or
discharge any outstanding indebtedness.
(i) to the best of the Company's knowledge, the Company is not in
material default under any contract to which it is a party or by which it is
bound, nor has any event occurred which, after the giving of notice or the
passage of time or both, would constitute a default under any such contract;
and the Company is not a party to or bound by any mortgage, lien, lease,
agreement, instrument, order, or judgment or decree which would prohibit the
execution of this Agreement or prohibit or make unduly burdensome the
consummation of any of the transactions provided for in this Agreement.
(j) Except for changes in the ordinary course of business, the Company
has good and marketable title to all of its properties and assets (including
the properties and assets reflected in the Balance Sheet but except any
property or
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assets since disposed of for value in the ordinary course of business) and none
of such properties or assets is subject to a contract of sale (except inventory
held for sale in the ordinary course of business) or subject to security
interests, mortgages, encumbrances, liens, or charges of any kind or character;
substantially all inventory now on hand is in good condition, and is presently
usable or salable in the ordinary course of business of the respective
corporations: substantially all fixed assets, plant, and equipment of the
Company reflected in the Balance Sheet are in good operating condition and
repair and their use in their business is in compliance with all applicable
laws or governmental regulations, including (without limitation) zoning, use,
or air pollution laws or regulations.
(k) The Company or its respective indicated subsidiary owns the patents,
patent applications, inventions, disclosures, copyrights, trademarks, trade
names, and licenses described in Exhibit 3 to this Agreement. Except to the
extent, if any, set forth in Exhibit 3, those patents, patent applications,
inventions, disclosures, copyrights, trademarks, trade names, and licenses are
valid and in good standing, are subject to no liens or charges (other than, in
the case of licenses or rights acquired from others, payments of royalties or
license fees as set forth or referred to in Exhibit 3) and to the best of
Company's knowledge are adequate and sufficient to permit the Company, to
conduct its businesses as presently being conducted. No rights under any other
patents, inventions, copyrights, trademarks, trade names, or licenses are
currently required by the Company in connection with its present conduct of
business. The Company has full right to use its corporate name in Louisiana and
any other place where it does business. The Company has not received any notice
of or knows of any conflict or claimed conflict with respect to the rights of
others to the use of its corporate name or, except to the extent, if any, set
forth in Exhibit 3, any such patent applications, inventions, disclosures,
copyrights, trademarks, trade names or licenses or know-how trade secrets or
techniques it uses. All manufacturing and engineering drawings or prints and
all process sheets, parts lists, and other data which pertain to the products
manufactured or sold by the Company are in reproducible form and of such
quality that Buyer can produce, manufacture, and assemble these products so
that they meet the specifications applicable to them. All experimental
processes and experimental procedures, if any, used by the Company are
understandably described in writings or drawings belonging to and in the
possession of the Company. To the best of Company's knowledge and without
having performed any particular investigation into the uniqueness of its own
trade secrets, substantially all trade secrets owned or used by the Company are
owned by it free of any adverse claims, rights, or encumbrances as to the
Company's exclusive rights to them. The Company will take such steps as
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requested by Buyer at or after the closing to insure disclosure of such trade
secrets to and only to persons designated by Buyer.
(l) The officers and directors of the Company are and except to the
extent; if any, that Buyer shall be notified of changes, will be at the closing
date, as set forth in Exhibit 4 to this Agreement.
Exhibits 2 and 4 together also show: the names of all persons whose
compensation from the Company for the fiscal year ending December 31, 2000, (at
their present or presently anticipated rates, including bonuses) will equal or
exceed $60,000, together with a statement of the full amount paid or payable to
each such person and the basis of payment (e.g., salary, bonus, stock
appreciation rights, commissions, etc.); the name of each bank, trust company,
or savings institution in which the Company has an account or safe deposit box
and the names and identification of all persons authorized to draw on or to
have access to any such account or safety deposit box; the names of all
persons, if any, holding powers of attorney from the Company and a summary
statement of the terms of each; and a list of all insurance policies owned by
the Company, with a brief statement of the coverage of each.
(m) Exhibit 5 to this Agreement contains a list of all real property
owned by the Company or in which the Company has a leasehold or other interest.
Exhibit 5 also contains a substantially accurate legal description of all real
property.
(n) The Company has not, with regard to any property, held, acquired,
or to be acquired, at any time filed a consent to the application of Section
341(f)(2) of the Internal Revenue Code, as amended.
(o) To the best of the knowledge of the Managing Stockholders (after
reasonable investigation) there is no development or threatened development
(relating particularly to the business of the Company as contrasted with
matters relating to its industry or of a regional or national or international
character) of a nature that would be materially adverse to its business.
(p) To the best of Company's knowledge, no representation or warranty
by Stockholders in this Section 2 or in any other section of this Agreement, or
in any certificate or other document furnished or to be furnished by
Stockholders pursuant to this Agreement, contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact
necessary to make the statements that are made not misleading or necessary in
order to provide Buyer with complete and accurate information as to the Company.
(q) The Shares referred to in subparagraph (a) of Section 1 are owned
by Stockholders free and clear of all liens, encumbrances, charges, and
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assessments, and such shares are subject to no restrictions with respect to
transferability to Buyer in accordance with the terms of this Agreement.
(r) Upon transfer of the Shares to Buyer by Stockholders, Buyer will, as a
result, receive good and marketable title, free and clear of all liens,
encumbrances, claims, charges, assessments, and restrictions, to all of the
Shares.
(s) The Company has not incurred any accumulated funding deficiency within
the meaning of the Employee Retirement Income Security Act of 1974 ("ERISA") or
any liability to the Pension Benefit Guaranty Corporation established under
ERISA in connection with any employee benefit plan established or maintained by
the Company.
3. Additional Representations, Warranties, and Agreements of
Stockholders.
Upon the closing, each member of the Board of Directors of the Company
shall sign a consent to the election of Xxxxxx X. Xxxxxxxx and Xxxxxx X.
Xxxxxxxx to the Board of Directors of the Company. Each current member of the
Board of Directors shall thereupon tender his resignation from the Board of
Directors.
4. Representations, Warranties and Agreements of Buyer.
Buyer represents and warrants to, and agrees with the Stockholders that:
(a) Buyer is a California corporation which has been validly incorporated
and is now and at the closing date will be validly existing, in good standing
under the laws of the State of California with an authorized capital stock of
250 million shares of common stock, without par value of which 60,940,497 and
no more are presently issued and outstanding.
(b) The execution, delivery, and performance of this Agreement by Buyer
have been duly authorized by all requisite corporate action.
(c) Upon the consummation of the transactions contemplated in this
Agreement, Stockholders shall own the Buyer Stock, in the amounts set forth
hereinabove, free and clear of all liens, encumbrances, charges, and
assessments.
(d) There is no restriction, other than restrictions that may be imposed
by the mandatory application of governmental laws and regulations, on the
transfer of the Buyer Stock arising out of Buyer's Articles of Incorporation,
By-laws, other corporate governance documents, or applicable agreements among
Buyer's shareholders.
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(e) Any and all financial statements of the Buyer provided to Seller in
connection herewith have been prepared in accordance with generally accepted
accounting principals consistently applied and fully and fairly set forth the
financial condition of the Buyer as of the dates of such statements and the
results of Buyer's operations for the periods indicated.
(f) Buyer has no knowledge of any existing or impending condition, the
occurrence of which would have a material adverse effect on the business,
financial condition, or prospects of the Buyer, except for general changes in
the economic, regulatory, competitive or technological environment that
generally affect all companies in the industry in which Buyer operates to an
equal extent.
(g) The parties agree that the Buyer may retain existing Company lines of
bank credit and other financial relationships; and in the event any such
relationships are retained, Buyer shall indemnify any and all individuals who
have personally guaranteed loans or other such obligations.
5. Access to Properties.
Stockholders agree to insure that Buyer, by representatives designated by
Buyer, shall have the right to examine the properties, books, and accounts of
the Company at any time prior to the date of closing during business hours and
that Buyer shall have the right at any time on or before the date of closing to
terminate this Agreement without liability to Buyer if Buyer determines that
the condition of the Company as of the date of the Balance Sheet and its
results of operations for the one (1) year then ended were not substantially as
represented in the Financial Statements referred to above, or if any of the
representations or warranties of Stockholders contained in this Agreement are
incorrect in any material respect.
6. The Closing.
(a) The transfer of the Company Stock and the payment of the consideration
for that stock by Buyer shall be effected as provided in this Agreement on the
date of closing specified below (the "closing"). Time shall be of the essence
and delivery of certificates for all of the Shares at the time and place
provided in this Agreement is a condition of Buyer's obligation, and delivery
of the certificates for all of the shares of Buyer Stock to be issued under
this Agreement at the closing at such time and place is a condition of
Stockholders' obligations.
(b) At the closing Stockholders shall deliver or cause to be delivered to
Buyer certificates evidencing the shares. The certificates evidencing the
Shares so delivered shall be properly endorsed for transfer or accompanied by
duly executed stock powers, in either case executed in blank or in favor of
Buyer as Buyer may have directed prior to the closing. Concurrently with the
delivery of the
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Shares, Buyer shall deliver certificates to Stockholders evidencing the shares
of Buyer Stock to be issued under this Agreement duly registered in the name of
the respective Stockholders. Stockholders agree to pay any taxes payable in
connection with the transfer by Stockholders to Buyer of the Shares, and all
costs and expenses of the performance of and compliance with all agreements and
conditions contained in this Agreement to be performed or complied with by
Stockholders.
(c) The closing shall take place at a place and on a date mutually agreed
by Buyer and the Stockholders not later than January 24, 2001. The place of the
closing may be changed by mutual agreement between Buyer and Stockholders. The
date and hour of closing is sometimes referred in this Agreement to as the
"date of closing" or the "closing."
(d) The Certificates for the Buyer Stock to be issued to the Stockholders
hereunder shall bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR THE
PURCHASER'S OWN ACCOUNT AND NOT WITH A VIEW TO, OR FOR RESALE IN CONNECTION
WITH, ANY DISTRIBUTION THEREOF. NO SALE OR OTHER DISPOSITION OF SUCH SECURITIES
MAY BE EFFECTED WITHOUT THE (1) REGISTRATION OF SUCH SALE OR DISPOSITION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND (2) QUALIFICATION OF SUCH SALE OR
DISPOSITION UNDER THE CALIFORNIA CORPORATE SECURITIES LAW OF 1968, AS AMENDED,
OR AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED."
7. Conditions of Buyer's Obligations.
(a) Buyer's obligations under this Agreement are subject to the accuracy
in all material respects at and as if made at the date of closing of the
representations and warranties made by the Company in this Agreement and
fulfillment to the date of closing of its agreements contained in this
Agreement and to the following additional conditions:
Buyer shall have the right at Buyer's election and expense to
instruct accountants of its choice to make a limited review and/or a full
examination as of a reasonable date prior to the closing of the financial
statements of the Company and/or to restate those financial statements through
the latest practicable date on the basis of a fiscal year ending December 31,
2000. If Buyer elects to request a full examination, it shall be carried out in
accordance with generally accepted
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auditing standards and Buyer's obligations under this Agreement are further
expressly conditioned upon the report of such accountants being delivered to
Buyer stating in substance that in their opinion the audited financial
statements examined by them fairly set forth in all material respects the
financial condition, results of operations, and changes in shareholders' equity
and changes in financial position or cash flow of the Company as of the dates of
those audited financial statements and the periods they cover in accordance with
generally accepted accounting principles consistently applied. Buyer's
obligations under this Agreement are also expressly conditioned upon Buyer's not
obtaining as a result of any such limited review or full examination or
restatement of financial statements or from the monthly financial statements to
be supplied to Buyer as provided in this Agreement or from other sources deemed
by Buyer to be reliable any information which buyer interprets as: casting doubt
in a material respect upon the accuracy or fairness of presentation of the
Financial Statements; or indicating the occurrence of a material adverse change
since the date of the Financial Statements in the financial condition, business
or affairs of the Company; or indicating a significant variance since December
31, 2000 from previous trends or conditions in the period ended that date as to
costs (or labor or other services, material or sales), backlog, sales volume,
sales mix, sales pricing, profit margins, products and rights to manufacture and
sell products, customers, continuing ability to effect sales as in the past or
any other significant aspect of the business of the Company; or indicating that
such restated financial statements of the Company do not present a financial
condition as of the closest practicable date to the date of closing and results
of operations through that date at least as good as those presented by the
Financial Statements.
(b) There shall have been no material adverse change since the date of
the Balance Sheet in the financial condition or affairs of the Company and it
shall not have suffered any loss (whether or not insured) by reason of physical
damage caused by fire, earthquake, accident, or other calamity which
substantially affects the value of its properties or business, and Buyer shall
have received certificates of the President and the Secretary of the Company
dated the date of closing to that effect.
8. Conditions of Stockholders' Obligations.
The Company's obligations and the Stockholders' obligations under this
Agreement are subject to the accuracy in all material respects at and as if
made at the date of closing of the representations and warranties contained in
this Agreement on the part of Buyer and the fulfillment to date of closing of
Buyer's agreements contained in this Agreement.
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9. Satisfaction of Conditions Precedent.
Each party agrees to use its best efforts to cause the conditions to its
obligations set forth above to be satisfied at or prior to the closing.
10. Additional Agreements of Stockholders.
(a) If the sale of the Shares is consummated pursuant to this Agreement,
each Managing Stockholder agrees to refrain anywhere in the world from carrying
on directly or indirectly (either as a proprietor, partner, stockholder,
officer, director, agent, employee, consultant, trustee, affiliate, or
otherwise) a business of the type conducted by the Company on the date of
closing or the business of manufacturing or selling products that are or would
be competitive with products presently manufactured or sold or offered for sale
by the Company, including the business of manufacturing and distributing
monitoring and control instrumentation; except as officers, employees, or
representatives of Buyer or a subsidiary or affiliate of Buyer, for a period of
two (2) years from the date such Managing Stockholder ceases to be employed by
Buyer or a subsidiary or affiliate thereof. Each Managing Stockholder agrees
that the business of Buyer and the Company is worldwide in scope and the
foregoing limitation is reasonable as to scope in light of the business of
Buyer and the Company. Notwithstanding the foregoing, it shall not be a breach
of the provisions of this paragraph for any Stockholder to own, as a passive
investment, not more than 5 percent of the outstanding stock of a publicly held
company engaged in any of the above activities.
(b) Each Stockholder covenants and represents that such Stockholder has no
interest in, or claim to any of the inventions, formulae, methods, processes,
or technical information used in the business of operations or in the current
possession of the Company, and all knowledge or information of a confidential
nature acquired at or before the date of this Agreement with respect to the
business and operations of the Company or any of its predecessors and all
knowledge or information of a confidential nature acquired after the date of
this Agreement about the business and operations of the Company or its
successors, will be held in confidence by the Stockholder, and will not be
disclosed or made public or made use of by or through Stockholder, directly or
indirectly.
(c) Each Shareholder acknowledges the following:
THE SHARES OF BUYER STOCK TO BE TRANSFERRED TO STOCKHOLDER PURSUANT TO
THIS AGREEMENT HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE OR FEDERAL GOVERNMENTAL AGENCY, NOR HAS ANY
SUCH AGENCY PASSED UPON THE ACCURACY OF ANY
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REPRESENTATIONS MADE IN CONNECTION WITH THE SALE OF SUCH SECURITIES.
11. Conduct of Business Pending Closing.
From and after the date of this Agreement, and prior to the date of
closing, the business of the Company shall be conducted in the ordinary course
of business, and none of the assets or properties of the Company shall be sold
or disposed of except in the ordinary course of business or except with the
written consent of Buyer; and no commitments, bids, or binding offers shall be
made, and no contract shall be entered into, which would require the
expenditure of money or the acquisition of assets or the performance of
services over a period of more than one year or otherwise than in the ordinary
course of business except with the consent of Buyer; it being understood that
any agreement or series of agreements with an obligation of less than $5,000
shall be considered to be in the ordinary course of business for the purpose of
this paragraph. Promptly after the execution of this Agreement, Stockholders
shall deliver to Buyer a balance sheet and a statement of income of the Company
for each month ended since the date of the latest balance sheet in the
Financial Statements and for the same month(s) in the prior year, in each case
in reasonable detail, showing its financial condition at the end of those
months and the results of its operations for those months. After the execution
of this Agreement until and including the date of closing Stockholders shall
deliver to Buyer on or before the tenth of each month a similar balance sheet
and statement of income for the Company for the previous month and the same
month in the prior year.
12. Fees or Commissions of Brokers.
Each Stockholder represents to Buyer that such Stockholder has not dealt
with any broker or finder in this transaction and agrees to indemnify Buyer
against any loss, cost, or expense, including attorneys' fees, as a result of
any claim for a fee or commission asserted by any broker or finder claiming
against or through Stockholder with respect to this Agreement or its
consummation. Buyer represents to each Stockholder that Buyer has not dealt
with any broker or finder in this transaction and agrees to indemnify each
Stockholder against any loss, cost, or expense, including attorneys' fees, as a
result of any claim for a fee or commission asserted by any broker of finder
claiming against or through Buyer with respect to this Agreement or its
consummation.
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13. Assignment of Patents, etc.
Each Stockholder agrees to assign to Buyer or its designee all patents,
patent applications, inventions, disclosures, written technical data,
copyrights, formulae, manufacturing methods, trade secrets and trademarks and
trade names, if any, owned by that Stockholder or under which Stockholder
claims any rights and relating to any products of or processes used by the
Company or relating to its business. If and to the extent any corporation,
firm, or person controlled by or affiliated with that Stockholder owns or has
rights in any of the foregoing, that Stockholder agrees to cause such
corporations or persons to assign all such rights to Buyer or the Company
without additional consideration being paid for those rights by Buyer or
Company.
14. Indemnification by Stockholders.
Stockholders jointly and severally agree to indemnify and hold Buyer and
the Company harmless against, and will reimburse Buyer (or the Company if Buyer
so requests) on demand for any payment (and any expenses, including attorneys'
fees and costs of investigation, incurred in defending against such payment or
any claim for such payment) made by the Company at any time after the date of
the Balance Sheet or by Buyer at any time after the date of closing. In respect
of:
(a) Any and all liabilities of the Company of any nature, whether accrued,
absolute, contingent, or otherwise existing at the date of the Financial
Statements, to the extent not reflected or reserved against in the Financial
Statements, or disclosed on Exhibits to this Agreement.
(b) Any and all liabilities of or claims against the Company arising out
of (i) the conduct of the business of the Company between the date of the
Financial Statements and the date of closing, otherwise than in the ordinary
course of business of the Company or as disclosed in any Exhibit to this
Agreement; (ii) any presently existing obligation, commitment, or liability of
the character described in clause (ii) of Section 2(e) of this agreement and
not listed in one or more exhibits to this Agreement; and (iii) any contract or
commitment entered into or made or any obligation or liability incurred by the
Company between the date of this Agreement and the date of closing and not
permitted by the provisions of Section 11 of this Agreement.
(c) Any and all damage or deficiency resulting from any
misrepresentations, breach of warranty, or nonfulfillment of any agreement on
the part of a Stockholder under this Agreement, or from any misrepresentation
in,
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or omission from, any certificate or other instrument furnished or to be
furnished to Buyer pursuant to the Agreement.
15. Notices.
Any notices under this Agreement shall be deemed sufficiently given by
one party to another if in writing and if and when delivered or tendered either
in person or by depositing it in the United States mail in a sealed envelope
registered or certified, with postage and postal charges prepaid, addressed as
follows:
If to Buyer:
InterGlobal Waste Management, Inc.
000 Xxxxx Xxxxx, Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
If to any of the Stockholders:
0000 X. Xxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
If to PolyCast:
00000 Xxxxxxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxx Xxxxxx
or to such other address as the party addressed shall have previously
designated by notice to the serving party, given in accordance with this
paragraph; provided, that a notice not given as above shall, if it is in
writing, be deemed given if and when actually received by the party to whom it
is required or permitted to be given.
16. Miscellaneous.
(a) This Agreement shall be binding upon and shall inure to the benefit
of Stockholders and their respective heirs, executors, administrators, and
assigns and of the Buyer and its successors and assigns.
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(b) This Agreement constitutes the entire agreement among the parties
pertaining to the subject matter of this Agreement and supersedes all prior
agreements and understandings of the parties in connection with that subject
matter.
(c) This Agreement shall be governed by and construed in accordance with
the laws of the State of California, except that the provisions of Section 10
of this Agreement shall be governed as to any conduct prohibited by Section 10
by the laws of the state in which such prohibited conduct occurs.
(d) All of the terms, conditions, warranties, and representations
contained in this Agreement shall survive delivery by Buyer of the
consideration to be given by it under this Agreement and delivery by
Stockholders of the consideration to be given by them under the Agreement,
shall survive the date of closing, and shall survive and continue
notwithstanding any investigations by or on behalf of Buyer at any time.
(e) This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original but all of which shall constitute one and
the same instrument.
(f) Consent to Jurisdiction. Each of the Stockholders and the Buyer, by
its or his execution hereof, (i) hereby irrevocably submits to the exclusive
jurisdiction of the state and Federal courts located within Los Angeles County,
State of California for the purpose of any claim or action arising out of or
based upon this Agreement or relating to the subject matter hereof, (ii) hereby
waives, to the extent not prohibited by applicable law, and agrees not to
assert by way of motion, as a defense or otherwise, in any such claim or
action, any claim that is not subject personally to the jurisdiction of the
above-named courts, that its or his property is exempt or immune from
attachment or execution, that any such proceeding brought in the above-named
court is improper, or that this Agreement or the subject matter hereof may not
be enforced in or by such court, and (iii) hereby agrees not to commence any
claim or action arising out of or based upon this Agreement or relating to the
subject matter hereof other than before the above-named courts nor to make any
motion or take any other action seeking or intending to cause the transfer or
removal of any such claim or action to any court other than the above-named
courts whether on the grounds of inconvenient forum or otherwise. Each of the
Stockholders and the Buyer hereby consents to service of process in any such
proceeding in any manner permitted by California law, and agrees that service
of process by registered or certified mail, return receipt requested, at its
address specified pursuant to Paragraph 15 hereof is reasonably calculated to
give actual notice.
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(g) WAIVER OF RIGHT TO JURY TRIAL. EACH OF THE STOCKHOLDERS AND THE
BUYER, BY ITS OR HIS EXECUTION HEREOF, WAIVES ITS OR HIS RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION AND THE RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT,
INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THE STOCKHOLDERS AND THE
BUYER ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A
BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER IN ENTERING
INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR
RELATED FUTURE DEALINGS. THE STOCKHOLDERS AND THE BUYER FURTHER WARRANT AND
REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH ITS OR HIS, AS THE CASE MAY
BE, LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS OR HIS,
AS THE CASE MAY BE, JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE TRANSACTION
CONTEMPLATED HEREBY. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS
A WRITTEN CONSENT TO A TRIAL BY THE COURT.
(h) Arbitration of Disputes. Any dispute between the parties hereto,
whether arising out of contract, tort or otherwise, or law, equity or
otherwise, shall be submitted to binding arbitration before the American
Arbitration Association in Los Angeles, California under the rules relating to
commercial arbitrations. Each party to any such dispute shall be entitled to
serve one set of pre-arbitration requests for production of documents,
containing not more than ten categories of documents to be produced, which
shall be described with particularity therein, and shall be entitled to notice
and take no more than two pre-arbitration depositions. Any disputes relating to
such pre-arbitration discovery shall be submitted to the arbitrator.
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(l) Any provision of this Agreement which is invalid or unenforceable in
any jurisdiction whose laws apply to determine the validity and enforceability
of the provision shall, as to such jurisdiction, be effective to the extent
allowed by law in that jurisdiction without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provisions in any
other jurisdiction.
INTERGLOBAL WASTE MANAGEMENT, INC.
By /s/ [Signature Illegible]
-----------------------------------
STOCKHOLDERS POLYCAST, INC.
/s/ [SIGNATURE ILLEGIBLE] By /s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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/s/ [SIGNATURE ILLEGIBLE]
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INDEX TO EXHIBITS
Exhibit 1 Corporations whose capital Stock is wholly or majority
owned by PolyCast
Exhibit 2 Exceptions to Exhibit 1 and representations and warranties
contained in Section 2
Exhibit 3 Patents, patent applications, inventions, disclosures,
copyrights, trademarks, trade names, and licenses owned by
the Company and exceptions thereto
Exhibit 4 Officers and Directors of the Company, and employees with
certain levels of compensation
Exhibit 5 Description of real property leased or owned by the Company
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EXHIBITS TO STOCK PURCHASE AGREEMENT
BY AND BETWEEN
INTERGLOBAL WASTE MANAGEMENT, INC.
AND
POLYCAST CORPORATION
These Exhibits, dated January 24, 2001, are being delivered by Polycast
Corporation pursuant to the Stock Purchase Agreement dated January 24, 2001 by
and between Interglobal Waste Management, Inc. and Polycast Corporation (the
"Agreement"). All references to section numbers are to the appropriate section
of the Agreement and are included for reference only. All disclosed items are
deemed to modify all applicable sections of the Agreement. Notwithstanding the
absence of specific cross-references, matters disclosed on any one exhibit
shall be deemed disclosed in all places on the exhibits where disclosure of
such matter is required or appropriate. Capitalized terms used herein, without
other definition, shall have the meanings ascribed to them in the Agreement.
EXHIBIT 1 Corporations whose capital stock is wholly
or majority owned by Polycast.
EXHIBIT 2 Exceptions to Exhibit 1 and representations
and warranties of Section 2.
EXHIBIT 3 Patents, patent applications, inventions,
disclosures, copyrights, trademarks, trade
names, and licenses owned by Polycast, and
exceptions thereto.
EXHIBIT 4 Officers and directors of Polycast, and
employees with certain levels of
compensation.
EXHIBIT 5 Description of real property owned or leased
by Polycast.
