STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made as of this
29th day of March 2002 by and between XXXXXX XXXXXXX a resident of Fort
Lauderdale, Florida ("Xxxxxxx"), DATAQUEST TECHNOLOGIES INC. a Florida
corporation (the "Company"), and METHOD PRODUCTS CORP., a Florida corporation
(the "Buyer").
WITNESSETH:
WHEREAS, Xxxxxxx owns all of the issued and outstanding capital stock
of the Company (the "Stock");
WHEREAS, Xxxxxxx desires to sell to the Buyer and the Buyer desires to
purchase from Xxxxxxx all of the Stock of the Company subject to the terms and
conditions of this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements and covenants herein contained, and other good and valuable
consideration, the receipt and sufficiency of which is acknowledged by the
parties hereto, the parties hereto covenant and agree as follows:
ARTICLE I
CLOSING; PRECLOSING DISTRIBUTIONS, PAYMENTS AND ASSUMPTIONS; SALE OF STOCK
1.01. Closing. The Closing (the "Closing") of the transaction described
herein shall take place at 12 p.m. eastern daylight time at the offices of the
Buyer located in Pompano Beach, Florida or such other location in the Pompano
Beach, Florida vicinity as the parties may agree on or before March 29, 2002
(the "Closing Date") unless a later date is agreed to by written consent of all
parties hereto.
1.02. Payoff of Creditors. At or prior to the Closing, Xxxxxxx and the
Company warrant that there are no outstanding payables and liabilities;
1.03 Purchase of Stock. Upon and subject to the terms and conditions of
the Agreement, Buyer agrees to purchase and accept delivery from Xxxxxxx, and
Xxxxxxx agrees to sell, assign, transfer and deliver to Buyer, at the Closing,
all of the issued and outstanding Stock of the Company, free and clear of all
liens, pledges, security interests, claims, charges, restrictions, equities or
encumbrances of any kind whatsoever. Xxxxxxx shall deliver to Buyer at Closing
the certificate or certificates representing the Stock of the Company owned by
Xxxxxxx, duly endorsed in blank by Hellman, or accompanied by a duly endorsed
stock power in blank, and with all necessary transfer tax and other revenue
stamps, acquired at the Company's expense, affixed and canceled. The Company and
Xxxxxxx agree to cure any deficiencies with respect to the endorsement of the
certificates or other documents of conveyance with respect to such Stock or with
respect to the stock power accompanying any of the Stock.
1.04. Purchase Price. The total purchase price for the Stock shall be
thirty thousand (30,000) shares of the Buyer's restricted common stock (the
"Purchase Price"). The shares of restricted stock shall be delivered within 10
business days of the closing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.01. Representations and Warranties of The Company. The Company hereby
makes the following representations and warranties to Buyer as of the date of
this Agreement through the Closing:
(a) Authority. The Company is a Florida corporation duly
organized, validly existing and in good standing under the laws of the state in
which it is organized. The Company has all requisite power and authority and the
legal right to own its properties and to conduct its business as currently
conducted, and to execute, deliver and perform this Agreement. The Company's
execution, delivery, and performance of this Agreement has been duly and validly
authorized by all necessary action on the part of the Company. This Agreement
has been duly executed and delivered by the Company and constitutes the legal,
valid and binding obligation of the Company enforceable in accordance with its
terms against the Company except as may be limited by laws affecting the
enforcement of creditors' rights or equitable principles generally.
(b) No Restrictions Against Performance. Neither the
execution, delivery, or performance of this Agreement by the Company, or the
consummation of the transactions described herein will, with or without the
giving of notice or the passage of time, or both, violate any provisions of,
conflict with, result in a breach of, constitute a default under, or result in
the creation or imposition of any Lien or condition under, (i) any and all
organizational documents of the Company, including as applicable, the Company's
articles of incorporation and bylaws, as same may be amended; (ii) any federal,
state or local law, statute, ordinance, regulation or rule, which is or may be
applicable to the Company, the Assets or the Stock; (iii) any contract,
indenture, instrument, agreement, mortgage, lease, right or other obligation or
restriction to which the Company is a party or by which the Company, the Stock
or the Assets is or may be bound; or (iv) any order, judgment, writ, injunction,
decree, license, franchise, permit or other authorization of any federal, state
or local court, arbitration tribunal or governmental agency by which the
Company, the Stock or the Assets is or may be bound. The execution and delivery
of this Agreement by the Company and the performance by the Company of the
transactions described herein will not constitute an act of bankruptcy,
preference, insolvency or fraudulent conveyance under any bankruptcy act or
other law for the protection of debtors or creditors.
(c) Third-Party and Governmental Consents. No approval,
consent, waiver, order or authorization of, or registration, qualification,
declaration, or filing with, or notice to, any federal, state or local
governmental authority or other third party is required in connection with the
Company's execution of this Agreement or the consummation of the transactions
described herein except: (i) the approval of the Company, which constitutes the
Company's sole shareholder (Xxxxxxx), which approval shall be evidenced by the
execution of this Agreement by a duly authorized representative of the Company;
(ii) the consent of certain of the Company's customers and product lines and/or
vendors required under maintenance services agreements in effect with respect to
such customers, attached as Exhibit 2.
(d) Capitalization. The authorized capital stock of the
Company consists of shares of common stock, of which ____ shares are issued and
outstanding. Xxxxxxx owns all __________ of the issued and outstanding shares of
the Stock, free and clear of all security interests, liens, adverse claims,
encumbrances, equities, proxies and shareholder agreements. Each outstanding
share of Stock has been legally and validly issued and is fully paid and
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nonassessable. No shares of the Stock are owned by the Company in treasury. No
shares of the Stock have been issued or disposed of in violation of the
preemptive rights, rights of first refusal or similar rights of any of the
Company's stockholders. The Company has no bonds, debentures, notes or other
obligations the holders of which have the right to vote (or are convertible into
or exercisable for securities having the right to vote) with the stockholders of
the Company on any matter.
(e) Transactions in Capital Stock. There exist no options,
warrants, subscriptions or other rights to purchase, or securities convertible
into or exchangeable for, any of the authorized or outstanding securities of the
Company, and no option, warrant, call, conversion right or commitment of any
kind exists which obligates the Company to issue any of its authorized but
unissued capital stock. The Company has no obligation (contingent or otherwise)
to purchase, redeem or otherwise acquire any of its equity securities or any
interests therein or to pay any dividend or make any distribution in respect
thereof.
(f) Continuity of Business Enterprise. Except as described by
this Agreement, there has not been any sale, distribution or spin-off of
significant assets of the Company other than in the ordinary course of business
within the two (2) year period preceding the date of this Agreement.
(g) Corporate Records. The copies of the articles of
incorporation and bylaws, and all amendments thereto, of the Company that have
been delivered or made available to Buyer are true, correct and complete copies
thereof, as in effect on the date hereof. The minute books of the Company,
copies of which have been delivered or made available to Buyer, contain accurate
minutes of all meetings of, and accurate consents to all actions taken without
meetings by, the Board of Directors (and any committees thereof) and the
stockholder(s) of the Company in the three (3) years prior to the Closing Date,
and contain all other material minutes and consents of the directors and
stockholders of the Company since its formation. On or prior to the Closing
Date, the Company shall deliver to the Buyer any and all additional corporate
records of the Company, including but not limited to all invoices, purchase
orders, customer contracts, human resources records, insurance policies
currently in effect and issued to the Company, and tax returns of every type and
nature.
(h) Title. The Company has good, valid, marketable, legal and
beneficial title to all of the Assets (except with respect to equipment which is
leased pursuant to the leases described in Section 2 hereof) and all of the
Assets shall be at Closing free and clear of all liens, liabilities, claims,
mortgages, obligations, restrictions, or other encumbrances of any kind or
nature (collectively, "Liens"), of any nature whatsoever, whether absolute,
legal, equitable, accrued, contingent or otherwise, including without limitation
any rights of first refusal as to any of the Assets. A complete and accurate
list of the inventory, equipment, furniture, furnishings, fixtures, customer
(with a summary of all fee provisions pertaining to the customer agreements
relating to such customers, the term of each of such customer agreements, and
identification as to any additional warranties provided by the Company pursuant
thereto, in addition to or in lieu of manufacturers' warranties) and supplier
contracts, equipment leases, trademarks, service marks and Internet domain names
constituting a portion of the Assets is attached hereto as Schedule 2 non other
than the maintenance service agreements listed on exhibit A. The sole asset of
the company are the service agreements. Except with respect to Liens affecting
the Assets, any and all of which shall be released at or prior to the Closing,
there are no outstanding options, warrants, commitments, agreements or any other
rights of any character, entitling any person or entity other than Buyer to
acquire any interest in all, or any part of, the Assets.
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(i) Orders and Decrees. None of the Company, the Stock or any
of the Assets is subject to any judicial or administrative order, ordinance or
zoning restriction which would adversely affect, or impose any condition on, the
Company, the Stock, the Assets, or the transactions described herein.
(j) Compliance with Laws. The Company is in compliance in all
material respects with all applicable laws, rules, regulations and
administrative orders of (i) the United States, (ii) Florida and any other
states and/or other jurisdictions in which it transacts business, and (iii) any
municipality, county, or subdivision, to which the Company, the Stock or any of
the Assets is or may be subject.
(l) Taxes. The Company has since its inception prepared and
filed all United States income tax returns and reports and all state, local and
municipal tax returns and reports of every nature that are required to be filed
by it and has paid or made provisions for the timely payment of all taxes and/or
other charges, however characterized, that have become due pursuant to such
returns and reports, including but not limited to unemployment compensation,
property, payroll and sales taxes. None of such returns or reports have been
audited by any regulatory authority, including but not limited to the Internal
Revenue Service (the "IRS") nor has the IRS or any other regulatory authority
made inquiry of, reviewed or otherwise investigated same. No deficiency,
assessment or proposed adjustment of any of such taxes and/or charges, however
characterized, is pending or, to the Company's knowledge, threatened, nor are
any investigations by any regulatory authorities pending or, to the Company's
knowledge, threatened pertaining thereto. The Company has not received nor is it
otherwise aware of, any written notices or other inquiries, written or oral,
relating to any taxes and/or other charges, however characterized, from any
regulatory authority, which may adversely impact the Company, the Stock, the
Assets or the transactions described in this Agreement.
(m) Personal Property and EquipmentThe company owns no
personal property or equipment
(n) Employment Matters. Except as set forth in Schedule 3
hereof, the consummation of the transactions described hereby will not cause the
Company or the Buyer to incur or suffer any liability relating to, or obligation
to pay, any severance, termination or other payment of any type whatsoever,
however characterized, including but not limited to payroll withholding taxes,
to any person or entity. Except as set forth in Schedule 3 hereof, no employee
of the Company has any contractual right to continued employment by the Company
following the consummation of the sale and transfer of the Stock pursuant to
this Agreement, the Buyer shall be free to offer employment to the employees of
the Company, and the Company shall be free to continue the employment of such
employees. Set forth in Schedule 3 is an accurate and complete list of all
employees employed by Dataquest Technologies showing as to each the nature of
the employee's job, years of service, the amount or rate of compensation, all
accruals of vacation, personal days, sick leave, and any other benefits due the
employee and other matters which may be reasonably required by the Buyer.
(o) Litigation. There is no judicial or administrative action,
suit or proceeding, pending, or to A the Company's knowledge, threatened against
or relating to the Company, the Stock or the Assets, before any federal, state
or local court, arbitration tribunal or governmental authority which could,
individually or in the aggregate, (i) result in the voluntary or involuntary
transfer of any of the Stock or the Assets; or (ii) adversely affect the
Company, the Stock or the Assets. The Company knows of no reasonable basis for
any such action, suit, proceeding or any governmental investigation relating to
the same.
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(p) Absence of Undisclosed Liabilities. As of the Closing
Date, the Company will not to its knowledge have any liabilities or obligations,
either direct or indirect, matured or unmatured or absolute, contingent or
otherwise, except those liabilities and obligations: (i) associated with
executory contracts entered into by the Company with its customers (which
liabilities include, without limitation deferred service revenue obligations),
(ii) owed to the Company (or its affiliated entities) as expressly provided in
this Agreement and (iii) relating to employment arrangements with the Company's
employees identified in Schedule 3 hereof for: (1) paid time off accruing prior
to the actual date of Closing, (2) any severance due in connection with the
termination of the employee's employment on or after the Closing Date; and (3)
payroll, any required withholding related thereto and any and all obligations
with respect to such employees arising from and after the Closing. For purposes
of this Agreement, the term "liabilities" shall include, without limitation, any
direct or indirect indebtedness, guaranty, endorsement, claim, loss, damage,
deficiency, cost, expense, obligation or responsibility, fixed or unfixed, known
or unknown, asserted or unasserted, xxxxxx or inchoate, liquidated or
unliquidated, secured or unsecured.
(r) Commitments. Except as otherwise disclosed pursuant to
this Agreement, the Company is not a party to or bound by, nor are the Assets
bound by, whether or not in writing, any of the following:
(i) partnership or joint venture agreement;
(ii) guaranty or suretyship, indemnification or
contribution agreement or performance bond;
(iii) debt instrument, loan agreement or other
obligation relating to indebtedness for borrowed money or money lent or to be
lent to another;
(iv) contract to purchase real property;
(v) agreement relating to any material matter or
transaction in which an interest is held by a person or entity that is an
affiliate of the Company;
(vi) agreement for the acquisition of services,
supplies, equipment, inventory, fixtures or other property, or agreements with
public relations or advertising agencies, accountants or attorneys (other than
in connection with this Agreement and the transactions described herein)
involving more than $2,000 in the aggregate;
(vii) powers of attorney;
(viii) contracts containing non-competition
covenants;
(ix) any license or other agreement, written or
oral, pertaining to the use of the name "Data Quest Technologies, Inc." or any
derivative thereof, trademark or logo; or
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(x) any other agreement or commitment not made
in the ordinary course of business or that is material to the business,
operations, condition (financial or otherwise) or results of operations of the
Company.
(s) Financial Statements. Tax returns of the Company
for the all the fiscal years to the date of Closing, attached hereto as Exhibit
1, are true and correct copies of tax returns filed with the IRS,
(t) No Material Misrepresentations or Omissions. No
representation, warranty or covenant made by the Company or Xxxxxxx in this
Agreement or in any written statement or certificate furnished to or to be
furnished to the Buyer pursuant to this Agreement or in connection with the
transactions described in 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 made not misleading. All books, written
statements, documents and records furnished or given by the Company to the Buyer
and its authorized representatives and agents during the negotiation of or
preparatory to the execution of this Agreement and the consummation of the
transactions described herein contain no material misrepresentations or omit
material facts necessary to make such statements and materials not misleading.
2.02. Representations and Warranties of Xxxxxxx. Xxxxxxx hereby makes
the following representations and warranties to Buyer as of the date of this
Agreement through the Closing:
(a) Authority. Xxxxxxx is an individual, which resides in Fort
Lauderdale, Florida. Xxxxxxx has all requisite power and authority and the legal
right to own its properties and to conduct its business as currently conducted,
and to execute, deliver and perform this Agreement. Xxxxxxx'x execution,
delivery, and performance of this Agreement has been duly and validly authorized
by all necessary action on the part of the Xxxxxxx. This Agreement has been duly
executed and delivered by Xxxxxxx and constitutes the legal, valid and binding
obligation of Xxxxxxx enforceable in accordance with its terms against Xxxxxxx
except as may be limited by laws affecting the enforcement of creditors' rights
or equitable principles generally.
(d) Account Payables of the Company. Xxxxxxx agrees to
guarantee and timely pay all account payables and other liabilities of the
Company set forth in Schedule 2 of this Agreement after the Closing so as to not
adversely affect the Company's ongoing ordinary course of business. Concurrent
with the Closing, Xxxxxxx shall be deemed, without any further action, to
forgive any and all intercompany loans and payables otherwise outstanding, due
or owing by the Company to Xxxxxxx and/or any Xxxxxxx subsidiary and/or
otherwise related person and/or entity.
(e) Confirmation of Representation and Warranties of the
Company. The Company confirms each of the representations and warranties set
forth above by the Company.
(f) Litigation. There is no judicial or administrative action,
suit or proceeding, pending, threatened against or relating to Xxxxxxx and/or
the Company which could effect the Stock or the Assets, before any federal,
state or local court, arbitration tribunal or governmental authority which
could, individually or in the aggregate, (i) result in the voluntary or
involuntary transfer of any of the Stock or the Assets; or (ii) adversely affect
the Stock or the Assets. Xxxxxxx knows of no reasonable basis for any such
action, suit, proceeding or any governmental investigation relating to the same.
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(g) Tax Returns; Related Matters. Xxxxxxx will cause, at his
expense, all of the Company's tax returns for the fiscal year ended December
31st, 2001 to be professionally prepared and filed,and shall deliver to buyer a
copy of what has been filed with the IRS. The Company will provide or cause to
be provided by its appropriate personnel to the Buyer and Xxxxxxx any and all
normal support and oral and written representations normally required in an
audit performed in accordance with generally accepted accounting standards.
(h)Investment Representations of Company. The Company
understands that the Restricted Stock issued to Xxxxxxx is not registered under
the Securities Act of 1933, as amended (the "Securities Act"), or any state
securities laws. Xxxxxxx represents and warrants that it is an "accredited
investor" and "sophisticated investor" as defined under the Securities Act and
state "Blue Sky" laws. Xxxxxxx represents and warrants that the Restricted Stock
to be acquired by Xxxxxxx upon consummation of the transactions described in
this Agreement will be acquired by Xxxxxxx'x own account, not as a nominee or
agent, and without a view to resale or other distribution within the meaning of
the Securities Act and the rules and regulations thereunder, and that Xxxxxxx
will not distribute the Restricted Stock in violation of the Securities Act.
Xxxxxxx represents and warrants to Buyer that Xxxxxxx has such knowledge and
experience in financial and business matters such that Xxxxxxx is capable of
evaluating the merits and risks of Xxxxxxx'x investment in any the Restricted
Stock to be acquired by Xxxxxxx upon consummation of the transactions described
in this Agreement. Xxxxxxx confirms that it has had the opportunity to ask
questions of and receive answers from Buyer and its officers and directors
concerning the terms and conditions of Xxxxxxx'x investment in the Restricted
Stock, that it has reviewed Buyer's public filings made with the U.S. Securities
Exchange Commission under the Securities Exchange Act of 1934, as amended, for
the period July 1, 2001 through the Closing Date, and Xxxxxxx has received to
its satisfaction, such additional information, about Buyer's operations as
Xxxxxxx has requested.
(i) No Material Misrepresentations or Omissions. No
representation, warranty or covenant made by the Xxxxxxx in this Agreement or in
any written statement or certificate furnished to or to be furnished to the
Buyer pursuant to this Agreement or in connection with the transactions
described in 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 made not misleading. All books, written statements, documents and
records furnished or given by the Xxxxxxx to the Buyer and its authorized
representatives and agents during the negotiation of or preparatory to the
execution of this Agreement and the consummation of the transactions described
herein contain no material misrepresentations or omit material facts necessary
to make such statements and materials not misleading.
2.03. Representations and Warranties of Buyer. Buyer hereby makes the
following representations and warranties to the Company and Xxxxxxx as of the
date of this Agreement through the Closing:
(a) Authority. Buyer is a Florida corporation duly organized,
validly existing and in good standing under the laws of the state in which it is
organized. Buyer has all requisite power and authority and the legal right to
own its properties and to conduct its business as currently conducted, and to
execute, deliver and perform this Agreement. Buyer's execution, delivery, and
performance of this Agreement has been duly and validly authorized by all
necessary action on the part of the Buyer. This Agreement has been duly executed
and delivered by Buyer and constitutes the valid and binding obligation of Buyer
enforceable in accordance with its terms against Buyer except as may be limited
by laws affecting the enforcement of creditors' rights or equitable principles
generally.
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(b) No Restrictions Against Performance. Neither the
execution, delivery, or performance of this Agreement by Buyer, nor the
consummation of the transactions described herein will, with or without the
giving of notice or the passage of time, or both, violate any provisions of,
conflict with, result in a breach of, constitute a default under, or result in
the creation or imposition of any Lien or condition under, (i) Buyer's
organizational documents; (ii) any federal, state or local law, statute,
ordinance, regulation or rule, which is applicable to Buyer; (iii) any contract,
indenture, instrument, agreement, mortgage, lease, right or other obligation or
restriction to which Buyer is a party or by which Buyer is bound or to which the
shareholder(s) of the Buyer is/are a party or otherwise bound; or (iv) any
order, judgment, writ, injunction, decree, license, franchise, permit or other
authorization of any federal, state or local court, arbitration tribunal or
governmental agency by which Buyer is bound. The execution and delivery of this
Agreement by Buyer and the performance by Buyer of the transactions described
herein will not constitute an act of bankruptcy, preference, insolvency or
fraudulent conveyance under any bankruptcy act or other law for the protection
of debtors or creditors.
(c) Third-Party and Governmental Consents. No approval,
consent, waiver, order or authorization of, or registration, qualification,
declaration, or filing with, or notice to, any federal, state or local
governmental authority or other third party is required on the part of Buyer in
connection with the execution of this Agreement or the consummation of the
transactions described herein, or has otherwise been obtained prior to Closing.
(e) Investment Representations of Buyer. Buyer understands
that the Stock is not registered under the Securities Act of 1933, as amended
(the "Securities Act"), or any state securities laws. Buyer warrants that it is
an "accredited investor" or "sophisticated investor" as defined under the
Securities Act and state "Blue Sky" laws, or that Buyer has utilized, to the
extent necessary to be deemed a sophisticated investor under the Securities Act
and State "Blue Sky" laws, the assistance of a professional advisor. Buyer
represents and warrants that the Stock to be acquired by Buyer upon consummation
of the transactions described in this Agreement will be acquired by Buyer's own
account, not as a nominee or agent, and without a view to resale or other
distribution within the meaning of the Securities Act and the rules and
regulations thereunder, and that Buyer will not distribute any of the Stock in
violation of the Securities Act. Buyer represents and warrants to The Company
and Xxxxxxx that Buyer, either alone or together with the assistance of Buyer's
own professional advisor, has such knowledge and experience in financial and
business matters such that Buyer is capable of evaluating the merits and risks
of Buyer's investment in any of the Stock to be acquired by Buyer upon
consummation of the transactions described in this Agreement. Buyer confirms
that it has had the opportunity to ask questions of and receive answers from
Xxxxxxx and the Company concerning the terms and conditions of Buyer's
investment in the Stock, and Buyer has received to its satisfaction, such
additional information, about the Company's operations as Buyer has requested.
(f) No Material Misrepresentations or Omissions. No
representation, warranty or covenant made by Buyer in this Agreement or in any
written statement or certificate furnished to or to be furnished to the Company
or Xxxxxxx pursuant to this Agreement or in connection with the transactions
described in 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 made not misleading. All books, statements, documents and records
furnished or given by Buyer to the Company or Xxxxxxx and their respective
authorized representatives and agents during the negotiation of or preparatory
to the execution of this Agreement and the consummation of the transactions
described herein contain no material misrepresentations or omissions of material
facts.
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ARTICLE III
COVENANTS
3.01. The Company's Covenants. The Company hereby covenants and agrees
that:
(a) Conduct of Business. From the date hereof until
Closing, the Company shall:
(i) maintain and preserve the Assets in a
reasonable and prudent manner, in the ordinary and usual course in which it has
been conducted in the past, including but not limited to maintaining insurance
coverage for the Assets (to the extent insurable); provided however, that the
Company may continue to market and sell its inventory comprising a portion of
the Assets in the ordinary and usual course in which the Company has conducted
business in the past, and otherwise conduct its business in the ordinary and
usual course;
(ii) not create, assume, or incur any
indebtedness, make any expenditures or enter into any commitments with respect
to or affecting itself or the Assets, except as otherwise provided in this
Agreement or in the ordinary course of business;
(iii) not sell, transfer, dispose of, or create
or suffer any Lien on the Assets, except as expressly described in this
Agreement and except as may be approved by Buyer in advance; and
(iv) not take any other action which would have
an adverse effect its business or the Assets, including without limitation the
value or condition thereof.
(b) Liabilities for Salaries and Related Withholding. The
Company shall pay off or satisfy on or prior to the Closing Date any and all
liabilities for salary and required withholding that accrued prior to the
Closing Date and for fringe benefits, other than paid time off, that accrued
prior to the Closing Date.
(c) Further Assurances. the Company agrees, without further
consideration, to execute and deliver such other instruments of transfer and
take such other action, at the Company's expense, as Buyer may reasonably
request in order to put Buyer in possession of, and to vest in Buyer, good,
valid, and unencumbered title to the Stock and the Assets in accordance with
this Agreement and to consummate the transactions described in this Agreement.
(d) Best Efforts. The Company represents that it
shall use its best efforts to close pursuant to the terms of this Agreement by
the Closing Date.
3.02 Xxxxxxx'x Covenants. The Company hereby covenants and agrees that:
(a) Conduct of the Company's Business. From the date
hereof until Closing, Xxxxxxx shall cause the Company to:
(i) maintain and preserve the Company's
business and the Assets in a reasonable and prudent manner, in the ordinary and
usual course in which it has been conducted in the past, including but not
limited to maintaining insurance coverage for the Assets (to the extent
insurable); provided however, that the Company may continue to market and sell
its inventory comprising a portion of the Assets in the ordinary and usual
course in which the Company has conducted business in the past;
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(ii) not create, assume, or incur any
indebtedness, make any expenditures or enter into any commitments with respect
to or affecting the Company, the Stock or the Assets, except in the ordinary
course of business;
(iii) not sell, transfer, dispose of, or create
or suffer any Lien on the Stock or the Assets, except as expressly described in
this Agreement and except as may be approved by Buyer in advance; and
(iv) not take any other action which would have
an adverse effect on Ameritrend, the Stock, or the Assets, including without
limitation the value or condition thereof.
(b) Further Assurances. Xxxxxxx agrees, without further
consideration, to execute and deliver such other instruments of transfer and
take such other action, and to cause Ameritrend to execute and deliver such
other instruments of transfer and take such other action, at Xxxxxxx'x and/or
the Company's expense, as Buyer may reasonably request in order to put Buyer in
possession of, and to vest in Buyer, good, valid, and unencumbered title to the
Stock in accordance with this Agreement and to consummate the transactions
described in this Agreement.
(c) Best Efforts. Xxxxxxx represents that it shall use
its best efforts to close pursuant to the terms of this Agreement by the Closing
Date.
3.03. Covenants of Parties. The parties hereto covenant and agree that:
(a) Disclosure to Parties. If any of the parties should
become aware, prior to Closing, that any of its representations, warranties or
covenants is inaccurate or incapable of being performed, such party shall
promptly give written notice of such inaccuracy or incapability to the other
parties; provided, however, that nothing contained in this Section 3 shall
relieve the party bound by such representation, warranty or covenant from
complying with such representation, warranty, or covenant.
(b) No Hindrance. None of the parties will take any
action than can reasonably be expected to hinder or prevent the consummation of
the transactions described herein.
ARTICLE IV
CLOSING CONDITIONS
4.01. Conditions to Obligations of Buyer. This Agreement and the
obligations of Buyer to perform hereunder shall be subject to the satisfaction
by Xxxxxxx and the Company, or waiver in writing by Buyer, of the following
conditions as of the date hereof and through the Closing:
(a) Representations, Warranties Covenants, Agreements and
Obligations. All representations, warranties and agreements of each of Xxxxxxx
and the Company contained in this Agreement shall, except as expressly provided
herein, be true and correct as of the date hereof and through the Closing. Each
of Xxxxxxx, its business and Company shall have performed and complied with all
of its covenants and obligations under this Agreement.
(b) No Material Adverse Change. There shall not have
been any material adverse change in, about or concerning company, the Stock or
the Assets.
(c) Completion of Due Diligence Satisfactory to Buyer. Buyer
shall have conducted and completed due diligence to its sole satisfaction
pertaining to the Company, the Stock and the Assets for which each of Xxxxxxx
and the Company agrees to reasonably cooperate.
4.02. Conditions to Obligations of Xxxxxxx and Company. This Agreement
and the obligations of Xxxxxxx and the Company to perform hereunder shall be
subject to the satisfaction by Buyer, or waiver in writing by Xxxxxxx and the
Company, of the following conditions at or prior to Closing:
(a) Representations, Warranties and Obligations. All
representations, warranties and agreements of Buyer contained in this Agreement
shall, except as expressly provided herein, be true and correct at or prior to
Closing. Buyer shall have performed and complied with all of its covenants and
obligations under this Agreement.
(b) Deliveries. Buyer shall have delivered to Xxxxxxx
each of the documents specified in Section 5.02 hereof.
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4.03. Taxes. All state and/or local sales and transfer taxes, charges,
fees, and assessments applicable to the transactions described herein shall be
borne by Hellman, except for documentary stamp taxes, if any, relating to the
Promissory Note which shall be borne solely by the Buyer and documentary stamp
taxes, if any, relating to the transfer of the Stock which shall be borne solely
by the Company.
ARTICLE V
INDEMNIFICATION
5.01. Indemnification by Xxxxxxx. Xxxxxxx agrees to defend, indemnify
and hold Buyer, any subsidiary or affiliate thereof, the Company, and their
respective successors, officers, directors, agents and/or controlling persons
(the "Indemnified Buyer Group") harmless from and against any and all losses,
liabilities, damages, costs or expenses (including reasonable attorneys' fees,
penalties and interest) payable to or for the benefit of, or asserted by, any
party, resulting from, arising out of, or incurred as a result of (a) the
material falsity of any representation, warranty and/or covenant made by each of
Xxxxxxx and the Company herein or in accordance herewith, or (b) the breach of
any material representation, warranty and/or covenant of Xxxxxxx (prior to the
Closing) or the Company (prior to and after the Closing) herein or in accordance
herewith. Provided Xxxxxxx indemnification obligation shall expire 1 year after
date of closing
5.02. Indemnification by Buyer. Buyer agrees to defend, indemnify and
hold the Company harmless from and against any and all losses, liability,
damages, costs, or expenses incurred by the Company (including reasonable
attorneys' fees, penalties and interest) payable to or for the benefit of, or
asserted by, any party, resulting from, arising out of, or incurred as a result
of (a) the material falsity of any representation or warranty made by Buyer
herein or in accordance herewith, or (b) the breach of any material covenant of
the Company (after the Closing) or Buyer (prior to and after the Closing) herein
or in accordance herewith.
5.03. Notice of Claims. Buyer, Xxxxxxx and the Company, each agree to
give prompt written notice to the other(s) of any claim against the party giving
notice which might give rise to a claim by it against another party/parties
hereto based upon the indemnity provisions contained herein, stating the nature
and basis of the claim and the actual or estimated amount thereof. In the event
that any action, suit or proceeding is brought against Buyer, Xxxxxxx or the
Company with respect to which any party hereto may have liability under the
indemnification provisions contained herein, the indemnifying party/parties
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shall have the right, at its/their sole cost and expense, to defend such action
in the name or on behalf of the indemnified party/parties and, in connection
with any such action, suit or proceeding, the parties hereto agree to render to
each other such assistance as may reasonably be required in order to ensure the
proper and adequate defense of any such action, suit or proceeding. No party
hereto shall make any settlement of any claim which might give rise to liability
of another party under the indemnification provisions contained herein without
the written consent of such other party, which consent such other party
covenants shall not be unreasonably withheld.
ARTICLE VI
TERMINATION
6.01. Termination Due to Breach by Buyer. In the event that prior to
Closing Buyer fails to comply with any material term or obligation or breaches
any representation, warranty or covenant contained in this Agreement in any
material respect and does not cure such failure within five (5) business days of
receiving written notice from Xxxxxxx and/or the Company thereof, then Xxxxxxx
and the Company may, at their option, by written notice to Buyer, terminate this
Agreement. In such event, Xxxxxxx and the Company may pursue any and all
remedies at law and/or in equity to which they may be entitled.
6.02. Termination Due to Breach by Xxxxxxx and/or the Company. In the
event that Xxxxxxx and/or the Company fails to comply with any material term or
obligation or breaches any representation, warranty or covenant contained in
this Agreement in any material respect and does not cure such failure within
five (5) business days of receiving written notice from Buyer thereof, then
Buyer may, at its option, by written notice to Xxxxxxx and/or the Company,
terminate this Agreement. In such event, the Buyer may pursue any and all
remedies at law and/or in equity to which it may be entitled.
ARTICLE VII
GENERAL PROVISIONS
7.01. Expenses. Each of the parties to this Agreement will be
responsible and pay for the fees and expenses of their respective agents,
representatives, counsel, and accountants incidental to the negotiation,
drafting, and performance of this Agreement; provided, however, that Xxxxxxx
shall be solely responsible for any such fees incurred by the Company prior to
the Closing.
7.02. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns, but shall not be assignable or delegable in whole or in part
by any party without the other parties' prior written consent, which written
consent may be withheld in the sole discretion of each of the parties hereto
without any liability to the party withholding such consent.
7.03. Waiver. No provision of this Agreement shall be deemed waived by
course of conduct, including the act of closing, unless such waiver is made in a
writing signed by the party purporting to waive such provision stating that it
is intended specifically to modify this Agreement, nor shall any course of
conduct operate or be construed as a waiver of any subsequent breach of this
Agreement, whether of a similar or dissimilar nature.
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7.04. Entire Agreement. This Agreement (together with any exhibits
hereto) supersedes any other agreement, whether written or oral, that may have
been made or entered into by the parties (or by any director, officer, agent, or
other representative of such parties) relating to the matters described herein.
This Agreement (together with any exhibits hereto) constitutes the entire
agreement by and among the parties and there are no agreements or commitments
except as expressly set forth herein.
7.05. Further Assurances. Each of the parties hereto agrees to execute
all documents and instruments and to take or to cause to be taken all actions
which are necessary or appropriate to effectuate the transactions described in
this Agreement.
7.06. Risk of Loss. In the event of any loss, damage or destruction of
the Assets prior to Closing, the Company shall promptly restore, replace or
repair the damaged property to its previous condition at its own cost and have
the right to use all insurance proceeds to effect such restoration, replacement
or repair and to retain all excess proceeds.
7.07. Notices. All notices, demands, requests, and other communications
hereunder shall be in writing and shall be deemed to have been duly given and
shall be effective upon receipt if delivered by hand, or sent by certified or
registered United States mail, postage prepaid and return receipt requested, or
by prepaid overnight express service or via telecopier (upon receipt by the
sender of a printed confirmation of such transmission). Notices shall be sent to
the parties at the following addresses (or at such other address for a party as
shall be specified by like notice; provided that such notice shall be effective
only upon receipt thereof):
(a) If to The Company (prior to the Closing) or
Xxxxxx Xxxxxxx:
Data Quest Technologies, Inc.
0000 Xxxx Xxxxxxx Xxxxx xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xx 00000
Attention: Xxxxxx Xxxxxxx
Telecopier No. 000-000-0000
(c) If to The Company (after the Closing) or Buyer:
Method Products Corp.
0000 XX 00xx Xxxxxx, Xxxxx 000X
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx, Chief Executive
Officer
Telecopier No. (000) 000-0000
7.08. Amendments, Modifications. This Agreement may be amended or
modified only by a written instrument executed by each of Xxxxxxx, Buyer and the
Company which states specifically that it is intended to amend or modify this
Agreement.
7.09. Severability. If, at any time, any applicable federal, state, or
local governmental authority, or any court or arbitration tribunal having
jurisdiction determines that any provision of this Agreement is void, invalid or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof and this Agreement shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein, and, in lieu of each such illegal, invalid or unenforceable
provision, there shall be added automatically as a part of this Agreement a
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible and still be legal, valid and enforceable and still
preserve each party's benefits and equities hereunder.
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7.10. Applicable Law: Jurisdiction and Venue; Service of Process;
Waiver of Trial by Jury; Attorney's Fees. This Agreement and the legal relations
between the parties hereto shall be governed by and construed in accordance with
the substantive laws of the State of Florida, without giving effect to the
principles of choice or conflict of laws thereof. Jurisdiction and venue for any
action or proceeding brought by or between the parties relating to this
Agreement, shall be solely in the federal and/or state courts located in Broward
County, Florida. The parties hereby consent to the jurisdiction and venue of
such courts, and agree that they shall not contest or challenge the jurisdiction
or venue of such courts. The parties agree that service of any process, summons,
notice or document, by United States registered or certified mail, to their
respective addresses as set forth herein or as may otherwise be changed pursuant
to the notice provisions hereof, shall be effective service of process for any
action, suit or proceeding brought against it in any such court. In recognition
of the fact that the issues which would arise under this Agreement are of such a
complex nature that they could not be properly tried before a jury, each of the
parties waives trial by jury. The prevailing party/parties shall be entitled to
recover from the other party/parties its/their reasonable attorneys' fees and
costs.
7.11. Titles and Headings. Titles and headings to sections hereof are
inserted for convenience of reference only, and are not intended to be a part
of, or to affect the meaning or interpretation of, this Agreement.
7.12. Cooperative Efforts. The parties shall cooperate and take such
action as may be reasonably requested by the other in order to effect the
transactions described herein.
7.13. Execution in Counterparts; Facsimile. This Agreement may be
executed in one or more counterparts and via facsimile, each of which shall be
deemed an original, but all of which together shall constitute one and the same
agreement.
7.14. Interpretation; Rule of Construction That Ambiguities are to be
Construed Against the Drafter Not Applicable. This Agreement is to be construed
fairly and simply and not strictly for or against any of the parties hereto. The
section headings contained herein are for convenience of reference only, are not
part of this Agreement, and shall not affect the meaning or interpretation of
any provision hereof. The parties to this Agreement acknowledge that they have
each carefully read and reviewed this Agreement with their respective counsel,
and therefore, agree that the rule of construction that ambiguities shall be
construed against the drafter shall not be applicable.
7.15 Brokers. Each of the parties hereto represents and warrants to the
others that no broker is entitled to any commission or similar fee in connection
with the making and carrying out of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
DATAQUEST TECHNOLOGIES, INC.:
By: /s/ Xxxxxx Xxxxxxx
------------------------------
Xxxxxx Xxxxxxx, President
XXXXXX XXXXXXX:
By: /s/ Xxxxxx Xxxxxxx
----------------------------------
BUYER:
METHOD PRODUCTS CORP.
By: /s/ Xxxx Xxxxxxxxx
----------------------------
Xxxx Xxxxxxxxx, Chief Executive Officer
WITNESS:
By:
/s/ Xxxxxxx Xxxxxxxxxx
------------------------------------
Xxxxxxx Xxxxxxxxxx
