EXHIBIT 2.1
STOCK EXCHANGE AGREEMENT
This Agreement (the "Agreement"), dated as of September 26, 1997, among
Plastic Pallet Production, Inc., a Florida corporation (the "Corporation"), the
shareholders of the Corporation listed on the signature pages of this Agreement
(collectively referred to herein as the "Sellers"), and Cabec Energy Corp., a
Delaware corporation (the "Purchaser").
WITNESSETH
WHEREAS, Sellers hold all of the issued and outstanding shares of the
capital stock of the Corporation (the "Stock") and desire to sell, and Purchaser
desires to purchase the Stock; and
WHEREAS, the Corporation desires to join in the execution of this
Agreement for the purpose of evidencing its consent to the consummation of the
foregoing transaction and for the purpose of making certain representations and
warranties to and covenants and agreements with Purchaser; and
WHEREAS, it is the intent of the Purchase and the Sellers that this
transaction qualify as a tax free reorganization pursuant to Section
368(a)(1)(B) of the Internal Revenue Code.
NOW, THEREFORE, in consideration of the mutual representations,
warranties and covenants herein contained, and on the terms and subject to the
conditions herein set forth, the parties hereto hereby agree as follows:
ARTICLE I
PURCHASE AND SALE; CLOSING DATE
SECTION 1.01. PURCHASE AND SALE OF STOCK. Subject to and upon the terms and
conditions contained herein, at the Closing, Sellers shall sell, transfer,
assign, convey and deliver to
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Purchaser, free and clear of all adverse claims, security interests, liens,
claims and encumbrances and Purchaser shall purchase, accept and acquire from
Sellers, the Stock.
SECTION 1.02. PURCHASE PRICE AND PAYMENT. In consideration of the sale of the
Stock to Purchaser, Purchaser shall deliver to the Sellers at the Closing an
aggregate of 94,320,000 shares (the "Purchaser Shares") of Common Stock, $0.10
par value per share, of Purchaser ("Purchaser Common Stock"). Each of the
Sellers, his assigns or designees shall receive the number of Purchaser Shares
as listed opposite his name on Schedule 1.02.
SECTION 1.03. CLOSING. The exchange of shares contemplated herein (the
"Closing") shall take place at the offices of the Corporation on September 30,
1997, or at such other time or place as may be mutually agreed upon by the
parties. The date on which the Closing occurs shall be referred to herein as the
"Closing Date".
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION AND SELLERS
The Corporation and Sellers jointly and severally represent and warrant
that the following are true and correct as of the date hereof and will be true
and correct through the Closing Date as if made on that date:
SECTION 2.01. OWNERSHIP OF STOCK. Sellers own, beneficially and of record,
good and marketable title to the Stock, which constitutes all of the issued
and outstanding capital stock of the Corporation. At the Closing, Sellers
will convey to Purchaser good and marketable title to all of the issued and
outstanding capital stock of the Corporation, free and clear of all adverse
claims, security interests, liens, claims and encumbrances.
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SECTION 2.02. ORGANIZATION AND GOOD STANDING QUALIFICATION. The Corporation is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation, with all requisite corporate power and authority
to carry on the business in which it is engaged, to own the properties it owns,
to execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The Corporation is duly qualified and licensed to do
business and is in good standing in all jurisdictions where the nature of its
business makes such qualification necessary.
SECTION 2.03. CAPITALIZATION. The authorized capital stock of the Corporation
consists of 2,000,000 shares of common stock, par value $0.02 per share, of
which 2,000,000 shares are issued and outstanding. All of the issued and
outstanding shares of capital stock of the Corporation are duly authorized,
validly issued, fully paid and nonassessable. There exists no options, warrants,
subscriptions or other rights to purchase, or securities convertible into or
exchangeable for, the capital stock of the Corporation. No shares of capital
stock of the Corporation have been issued or disposed of in violation of the
preemptive rights of any of the Corporation's shareholders. All accrued
dividends on the capital stock of the Corporation, whether or not declared, have
been paid in full.
SECTION 2.04. CORPORATE RECORDS. The copies of the Articles of Incorporation and
all amendments thereto and the Bylaws of the Corporation that have been
delivered or made available to Purchaser are true, correct and complete copies
thereof, as in effect on the date hereof. The minute books of the Corporation,
copies of which have been delivered or made available to Purchaser, contain
accurate minutes of all meetings of, and accurate consents to all
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actions taken without meetings by, the Board of Directors (and any committees
thereof) and the shareholders of the Corporation since the formation of the
Corporation.
SECTION 2.05. AUTHORIZATION AND VALIDITY. The execution, delivery and
performance by the Corporation of this Agreement and any other agreements
contemplated hereby, and the consummation of the transactions contemplated
hereby and thereby, have been duly authorized by the Corporation and Sellers.
This Agreement and any other agreement contemplated hereby have been or will be
as of the Closing Date duly executed and delivered by the Corporation and
Sellers and constitutes or will constitute legal, valid and binding obligations
of the Corporation and Sellers, enforceable against the Corporation and Sellers
in accordance with their respective terms, except as may be limited by
applicable bankruptcy, insolvency or similar laws affecting creditors' rights
generally or the availability of equitable remedies. The sale of the Stock by
Sellers to Purchaser will not impair the ability or authority of the Corporation
to carry on its business as now conducted in any respect.
SECTION 2.06. SUBSIDIARIES. The Corporation does not own, directly or
indirectly, any interest in the capital stock of any other corporation or any
equity, profit sharing, participation or other interest in any corporation,
partnership, joint venture or other entity except as set forth on Schedule 2.06
hereto. All references herein to the Corporation shall include its subsidiaries
listed on Schedule 2.06.
SECTION 2.07. NO VIOLATION. Neither the execution, delivery or performance of
this Agreement or any other agreement contemplated hereby nor the consummation
of the transactions contemplated hereby or thereby will (i) conflict with, or
result in a violation or breach of the
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terms, conditions or provisions of, or constitute a default under, the
Articles of Incorporation or Bylaws of the Corporation or any agreement,
indenture or other instrument under which the Corporation is bound or to
which the stock or any of its assets of the Corporation are subject, or
result in the creation or imposition of any security interest, lien, charge
or encumbrance upon the Stock or any of the assets of the Corporation, or
(ii) violate or conflict with any judgment, decree, order, statute, rule or
regulation of any court or any public, governmental or regulatory agency or
body having jurisdiction over the Corporation, the Stock or the assets of the
Corporation. To the best of the Corporation's knowledge, the Corporation has
complied with all laws, regulations and licensing requirements and has filed
with the proper authorities all necessary statements and reports.
SECTION 2.08. CONSENTS. No authorization, consent, approval, permit or license
of, or filing with, any governmental or public body or authority, any lender or
lessor or any other person, or entity is required to authorize, or is required
in connection with, the execution, delivery or performance of this Agreement or
the other agreements contemplated hereby on the part of the Corporation or
Sellers.
SECTION 2.09. INVESTMENT INTENT. The Sellers are acquiring the Purchaser Shares
for their own respective accounts for investment and not with a view to, or for
sale or other disposition in connection with, any distribution of all or any
part thereof, except (i) in an offering covered by a registration statement
filed with the Securities and Exchange Commission under the Securities Act
covering the Purchaser Shares, or (ii) pursuant to an applicable exemption under
the Securities Act. In acquiring the Purchaser Shares, the Sellers are not
offering or selling, and will not offer or sell, for Purchaser in connection
with any distribution of the Purchaser Shares, and
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the Sellers do not and will not have a participation in any such underwriting
of such an undertaking except in compliance with applicable federal and state
securities laws.
SECTION 2.10. DISCLOSURE OF INFORMATION. The Sellers acknowledge that they or
their representatives have been furnished with substantially the same kind of
information regarding Purchaser and its business, assets, results of operations,
and financial condition as set forth in a prospectus meeting the statutory
requirements of the Securities Act for use in connection with a public sale of
the Purchaser Shares. The Sellers further represent that they have had an
opportunity to ask questions of and receive answers from Purchaser regarding
Purchaser and its business, assets, results of operation, and financial
condition and the terms and conditions of the issuance of the Purchaser Shares.
The foregoing, however, does not limit or modify the representations and
warranties of Purchaser in Article III, does not limit the rights of the Sellers
prior to and in anticipation of any issuance of the Purchasers Shares pursuant
hereto, and does not limit the disclosure requirements of applicable federal and
state securities laws. Sellers acknowledge that Purchaser and its
representatives have provided all of the information and documentation
concerning Purchaser, its business, operations, management, financial statements
and prospects and the Purchaser Shares requested by Sellers and are fully
satisfied with such information and documentation. Further, Sellers acknowledge
that Purchaser's financial statements provided to Sellers (as indicated in
Section 3.08 below) are all unaudited, in-house financial statements. Further,
Sellers acknowledge that the Purchaser does not and is not required to file
periodic reports with the US Securities and Exchange Commission.
SECTION 2.11. FINANCIAL STATEMENTS. On or before Closing the Sellers will
have furnished to the Purchaser the Corporation's unaudited consolidated
balance sheet and related unaudited
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consolidated statements of income, retained earnings and cash flows for the
period from inception to a date immediately prior to the Closing Date,
including the notes thereto (collectively, the "Corporation Financial
Statement"). The Corporation Financial Statements will be true, correct and
complete, in accordance with the books and records of the Corporation, will
fairly present the financial condition and results of operations of the
Corporation as of the dates and for the periods indicated and will have been
prepared in conformity with generally accepted accounting principles applied
on a consistent basis with prior periods.
SECTION 2.12. LIABILITIES AND OBLIGATIONS. The Corporation Financial Statements
reflect all of the liabilities of the Corporation, accrued, contingent or
otherwise (known or unknown and asserted or unasserted), arising out of
transactions effected or events occurring on or prior to the date hereof. All
reserves, if any, shown in the Corporation Financial Statements are appropriate,
reasonable and sufficient to provide for losses thereby contemplated. Except as
set forth in the Corporation Financial Statements, the Corporation is not liable
upon or with respect to, or obligated in any other way to provide funds in
respect of or to guarantee or assume in any manner, any debt, obligation or
dividend of any person, corporation, partnership, joint venture or other entity,
and the Sellers do not know of any basis for the assertion of any other claims
or liabilities of any nature or in any amount.
SECTION 2.13. ADVERSE AGREEMENTS. The Corporation is not a party to any
agreement or instrument or subject to any charter or other corporate restriction
or any judgment, order, writ, injunction, decree, rule or regulation that
materially and adversely affects, or so far as the Corporation and Sellers can
now foresee, may in the future materially and adversely affect, the
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condition (financial or otherwise), operations, assets, liabilities, business
or prospects of the Corporation.
SECTION 2.14. ABSENCE OF CERTAIN CHANGES. Since the inception of the
Corporation, (i) there has not been any material adverse change in the business,
assets, results of operations, or financial condition of the Corporation; (ii)
the business of the Corporation has been conducted only in the ordinary course
consistent with past practice, (iii) the Corporation has not incurred any
material liability, engaged in any material transaction, or entered into any
material agreement outside the ordinary course of business consistent with past
practice; and (iv) the Corporation has not suffered any material loss, damage,
destruction, or other casualty to any of its assets (whether or not covered by
insurance).
SECTION 2.15. INVESTMENT EXPERIENCE. The Sellers acknowledge that they are able
to fend for themselves, can bear the economic risk of their investment in the
Purchaser Shares, including a total loss of their investment, and have such
knowledge and experience in financial and business matters that they are capable
of evaluating the merits and risks of an investment in the Purchaser Shares. The
Sellers represent that they have not been organized for the purpose of acquiring
the Purchaser Shares.
SECTION 2.16. RESTRICTED SECURITIES. The Sellers understand that the Purchaser
Shares will not have been registered pursuant to the Securities Act or any
applicable state securities laws, that the Purchaser Shares will be
characterized as "restricted securities" under federal securities laws, and that
under such laws and applicable regulations the Purchaser Shares cannot be sold,
pledged, hypothecated or otherwise disposed of without registration under the
Securities Act or
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an exemption therefrom. In this connection, the Sellers represent that they
are familiar with Rule 144 promulgated under the Securities Act, as currently
in effect, and understand the resale limitations imposed thereby and by the
Securities Act. Stop transfer instructions may be issued to the transfer
agent for securities of the Purchaser (or a notation may be made in the
appropriate records of Purchaser) in connection with the Purchaser Shares.
SECTION 2.17. LEGEND. It is agreed and understood by the Sellers that the
certificates representing the Purchaser Shares shall each conspicuously set
forth on the face or back thereof a legend in substantially the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER SAID ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
SECTION 2.18. BROKER'S FEE. Neither the Corporation nor the Sellers has incurred
any obligation for any finder's, broker's or agent's fee in connection with the
transactions contemplated hereby, except as set forth in Schedule 2.18.
SECTION 2.19. ACCURACY OF INFORMATION FURNISHED. All information furnished to
Purchaser by the Corporation or the Sellers hereby or in connection with the
transactions contemplated hereby is true, correct and complete in all respects.
Such information states all facts required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, true, correct and complete.
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SECTION 2.20. PATENTS. The Corporation owns all of the rights and titles to
and interests in, free and clear of all liens and encumbrances, the United
States Patents listed and described on Schedule 2.20 hereto.
SECTION 2.21. REPRESENTATIONS AND WARRANTIES ON CLOSING DATE. The
representations and warranties made in this Article II will be true and correct
in all material respects on and as of the Closing Date with the same force and
effect as if such representations and warranties had been made on and as of the
Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
SECTION 3.01. ORGANIZATION AND GOOD STANDING. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of its
state of incorporation, with all requisite corporate power and authority to
carry on the business in which it is engaged, to own the properties it owns, to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby.
SECTION 3.02. CAPITALIZATION. The authorized capital stock of the Purchaser will
consist on the Closing Date of (i) 200,000,000 shares of common stock, $0.10 par
value per share, of which 26,590,000 shares will be issued and outstanding (the
"Outstanding Purchaser Stock") and (ii) 20,000,000 shares of preferred stock,
par value $0.0001 per share of which not more than 4,410,000 shares will be
issued and outstanding. All of the issued and outstanding shares of capital
stock of the Purchaser are duly authorized, validly issued, fully paid and
nonassessable. Except as set forth above and as referenced in Section 5.01(c),
there exists no other options,
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warrants, subscriptions or other rights to purchase, or securities
convertible into or exchangeable for, the capital stock of the Purchaser. The
Purchaser is not a party to or bound by, nor does it have any knowledge of,
any agreement, instrument, arrangement, contract, obligation, commitment or
understanding of any character, whether written or oral, express or implied,
related to the sale, assignment, encumbrance, conveyance, transfer or
delivery of any capital stock of the Purchaser. No shares of capital stock of
the Purchaser have been issued or disposed of in violation of the preemptive
rights of any of the Purchaser's shareholders.
SECTION 3.03. CORPORATE RECORDS. The copies of the Articles of Incorporation and
all amendments thereto and the Bylaws of the Purchaser that have been delivered
or made available to Sellers are true, correct and complete copies thereof, as
in effect on the date hereof. The minute books of the Purchaser, copies of which
have been delivered or made available to Sellers, 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 shareholders of the
Purchaser since the formation of the Purchaser.
SECTION 3.04. AUTHORIZATION AND VALIDITY. The execution, delivery and
performance by the Purchaser of this Agreement and the other agreements
contemplated hereby, and the consummation of the transactions contemplated
hereby and thereby, have been duly authorized by the Purchaser. This Agreement
and each other agreement contemplated hereby have been or will be as of the
Closing Date duly executed and delivered by the Purchaser and constitute or will
constitute legal, valid and binding obligations of the Purchaser enforceable
against the Purchaser in accordance with their respective terms, except as may
be limited by applicable bankruptcy, insolvency or similar laws affecting
creditors' rights generally, or the availability of
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equitable remedies. The sale of the Purchaser Shares by Purchaser will not
impair the ability or authority of the Purchaser to carry on its business as
now conducted in any respect.
SECTION 3.05. SUBSIDIARIES. The Purchaser does not own, directly or indirectly,
any interest in the capital stock of any other corporation or an equity, profit
sharing, participation or other interest in any corporation, partnership or
joint venture or other entity except as listed on Schedule 3.05 hereto. All
references herein to the Purchaser shall include its subsidiaries listed on
Schedule 3.05 (the "Purchaser Subsidiaries").
SECTION 3.06. NO VIOLATION. Neither the execution, delivery or performance of
this Agreement or the other agreements contemplated hereby nor the consummation
of the transactions contemplated hereby or thereby will (i) conflict with, or
result in a violation or breach of the terms, conditions or provisions of, or
constitute a default under, the Articles of Incorporation or Bylaws of the
Purchaser or any agreement, indenture or other instrument under which the
Purchaser is bound or to which the stock or any of its assets of the Purchaser
are subject, or result in the creation or imposition of any security interest,
lien, charge or encumbrance upon the Purchaser Common Stock or any of the assets
of the Purchaser, or (ii) violate or conflict with any judgment, decree, order,
statute, rule or regulation or any court or public, governmental or regulatory
agency or body having jurisdiction over the Purchaser, the Purchaser Common
Stock or the assets of the Purchaser. To the best of Purchaser's knowledge, the
Purchaser has complied with all laws, regulations and licensing requirements and
has filed with the proper authorities all necessary statements and reports.
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SECTION 3.07. CONSENTS. No authorization, consent, approval, permit or license
of, or filing with, any governmental or public body or authority, any lender or
lessor or any other person or entity is required to authorize, or is required in
connection with, the execution, delivery or performance of this Agreement or the
other agreements contemplated hereby on the part of the Purchaser.
SECTION 3.08. DISCLOSURE OF INFORMATION. The Purchaser acknowledges that it or
its representatives have been furnished with substantially the same kind of
information regarding the Corporation and its business, assets, results of
operations, and financial condition as set forth in a prospectus meeting the
statutory requirements of the Securities Act for use in connection with a public
sale of the Stock. The Purchaser further represents that it has had an
opportunity to ask questions of and receive answers from the Corporation and the
Sellers regarding the Corporation and its business, assets, results of
operation, and financial condition and the terms and conditions of the exchange
of the Stock. The foregoing, however, does not limit or modify the
representations and warranties of the Corporation and Sellers in Article II,
does not limit the right of Purchaser prior to and in anticipation of any
issuance of the Stock pursuant hereto, and does not limit the disclosure
requirements of applicable federal and state securities laws. Purchaser
acknowledges that Sellers and the Corporation have provided all of the
information and documentation concerning the Corporation, its businesses,
operations, management, financial statements and prospects and the Stock
requested by Purchaser and is fully satisfied with such information and
documentation. Further, Purchaser acknowledges that the Corporation's financial
statements provided to Purchaser (as indicated in Section 2.11 above) are all
unaudited, in-house financial statements.
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SECTION 3.09. FINANCIAL STATEMENTS. On or before Closing, the Purchaser will
have furnished to the Corporation and the Sellers the unaudited consolidated
balance sheet and related unaudited consolidated statements of income, retained
earnings and cash flows for the twelve-month period ending May 31, 1996,
including the notes thereto and the Purchaser's 1996 federal income tax return
(collectively, the "Purchaser Financial Statements"). The Purchaser Financial
Statements are true, correct and complete, are in accordance with the books and
records of the Purchaser, fairly present the financial condition and results of
operations of the Purchaser as of the dates and for the periods indicated and
have been prepared in conformity with generally accepted accounting principals
applied on a consistent basis with prior
SECTION 3.10. LIABILITIES AND OBLIGATIONS. The Purchaser Financial Statements
reflect all of the liabilities of Purchaser, accrued, contingent or otherwise
(known or unknown and asserted or unasserted), arising out of transactions
effected or events occurring on or prior to the date hereof. All reserves, if
any, shown in the Purchaser Financial Statements are appropriate, reasonable and
sufficient to provide for losses thereby contemplated. Except as set forth in
the Purchaser Financial Statements, the Purchaser is not liable upon or with
respect to, or obligated in any other way to provide funds in respect of or to
guarantee or assume in any manner, any debt, obligation or dividend of any
person, corporation, partnership, joint venture or other entity, and the
Purchaser does not know of any basis for the assertion of any other claims or
liabilities of any nature or in any amount.
SECTION 3.11. ADVERSE AGREEMENT. The Purchaser is not a party to any agreement
or instrument or subject to any charter or other corporate restriction or any
judgment, order, writ, injunction, decree, rule or regulation that materially
and adversely affects, or so far as the Purchaser can now
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foresee, may in the future materially and adversely affect, the condition
(financial or otherwise), operations, assets, liabilities, business or
prospects of the Purchaser.
SECTION 3.12. ABSENCE OF CERTAIN CHANGES. Since May 31, 1997, (i) there has not
been any material adverse change in the business, assets, results of operations,
or financial condition of the Purchaser; (ii) the business of the Purchaser has
been conducted only in the ordinary course consistent with past practice; (iii)
the Purchaser has not incurred any material liability, engaged in any material
transaction, or entered into any material agreement outside the ordinary course
of business consistent with past practice; and (iv) the Purchaser has not
suffered any material loss, damage, destruction, or other casualty to any of its
assets (whether or not covered by insurance).
SECTION 3.13. BROKER'S FEE. The Purchaser has not incurred any obligation for
any finder's, broker's or agent's fee in connection with the transactions
contemplated hereby, except as set forth in Schedule 3.13.
SECTION 3.14. ACCURACY OF INFORMATION FURNISHED. All information furnished to
the Corporation or the Sellers by Purchaser hereby or in connection with the
transactions contemplated hereby is true, correct and complete in all respects.
Such information states all facts required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, true correct and complete.
SECTION 3.15. REPRESENTATIONS AND WARRANTIES ON CLOSING DATE. The
representations and warranties made in this Article III will be true and correct
in all material respects on and as of the
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Closing Date with the same force and effect as if such representations and
warranties had been made on and as of the Closing Date.
ARTICLE IV
COVENANTS OF SELLERS
SECTION 4.01. COVENANTS.
A. Sellers each acknowledge and agree that on or after the
Closing Date, the capital stock or assets of the Purchaser subsidiaries will be
spun off or sold and the proceeds distributed to the shareholders of record of
the Outstanding Purchaser Stock other than the Seller and not to the Sellers (or
their permitted assigns) with respect to the Purchaser Shares, and Sellers
further agree to authorize and consent to such transactions.
X. Xxxxxxx each agree not to interfere with or exercise, directly
or indirectly, control of the Purchaser subsidiaries or to remove, change, or
add to the respective boards of directors, officers or management of the
Purchaser subsidiaries at any time on or after the Closing Date.
C. In further consideration of their acquisition of the Purchaser
Shares provided for by this Agreement, Sellers will contribute to the capital of
the Corporation the sum of US $150,000 on or before the execution of this
Agreement and an additional $100,000 on each of January 1, February 1, March 1,
1998, to fund cash flow and other requirements of the Corporation.
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ARTICLE V
CONDITIONS TO OBLIGATIONS OF PURCHASER
All obligations of the Purchaser under this Agreement are subject to
the fulfillment on or before the Closing Date, of each of the following
conditions (any one or more of which may, in the absolute discretion of the
Purchaser, be waived by Purchaser):
SECTION 5.01. DOCUMENTS DELIVERED TO PURCHASER. At the Closing, the following
documents shall be delivered to Purchaser: (i) Certificates representing the
Stock, duly endorsed or accompanied by duly executed stock powers; (ii) A
certificate executed by each of the Sellers dated on or before the Closing Date,
certifying in such detail as Purchaser may request that:
(A) The representations and warranties of the Sellers contained in
this Agreement are then true in all respects; and
(B) Sellers have complied with all agreements and conditions
required by this Agreement to be performed or complied with by it.
(C) Purchaser shall have entered into Employment Agreements with
Xxxxx Xxxxxx and Xxxxxxx XxXxxxxxx, substantially in the form attached hereto as
Schedule 5.01(c).
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ARTICLE VI
CONDITIONS TO THE OBLIGATIONS OF SELLERS
All obligations of the Sellers under this Agreement are subject to the
fulfillment on or before the Closing Date, of each of the following conditions
(any one or more of which may, in the absolute discretion of the Sellers, be
waived by Sellers):
SECTION 6.01 DOCUMENTS DELIVERED TO SELLERS. At the Closing, the following
documents shall be delivered to Sellers: (i) Certificates representing the
Purchaser Shares to be delivered pursuant to this Agreement with the
certificates bearing the names of the Sellers; (ii) A certificate executed by
the Purchaser dated the Closing Date, certifying in such detail as Sellers may
request that:
(A) The representations and warranties of the Purchaser contained
in this Agreement are then true in all respects; and
(B) Purchaser has complied with all agreements and conditions
required by this Agreement to be performed or complied with by it.
ARTICLE VII
INDEMNIFICATION
SECTION 7.01. INDEMNIFICATION BY SELLERS. The Sellers hereby agree to indemnify
and hold harmless Purchaser and its officers, directors and consultants and
their successors and assigns for the full amount of all losses, claims, expenses
or liabilities (including without limitation reasonable attorney's fees) arising
from or relating to (i) any breach of the representations and
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warranties made by the Corporation and Sellers in this Agreement or (ii) any
failure of Sellers duly to perform any covenant in this Agreement to be
performed by Sellers.
SECTION 7.02. INDEMNIFICATION BY PURCHASER. Purchaser hereby agrees to indemnify
and hold harmless the Sellers for the full amount of all losses, claims,
expenses or liabilities (including without limitation reasonable attorneys' fee)
arising from or relating to (i) any breach of the representations and warranties
made by the Purchaser in this Agreement or (ii) any failure of Purchaser duly to
perform any covenant in this Agreement to be performed by it.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENT. This Agreement may be amended, modified, or
supplemented only by an instrument in writing executed by all the parties
hereto.
SECTION 8.02. ASSIGNMENT. Neither this Agreement nor any right created hereby or
in any agreement entered into in connection with the transactions contemplated
hereby shall be assignable by any party hereto.
SECTION 8.03. PARTIES IN INTEREST; NO THIRD PARTY BENEFICIARIES. Except as
otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. Neither this
Agreement nor any other Agreement contemplated hereby shall be deemed to confer
upon any person not a party hereto or thereto any rights or remedies hereunder
or thereunder.
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SECTION 8.04. ENTIRE AGREEMENT. This Agreement and the agreements contemplated
hereby constitute the entire agreement of the parties regarding the subject
matter hereof, and supersede all prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect to the subject
matter hereof.
SECTION 8.05. SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the term hereof, such provision shall be fully severable and this Agreement
shall be construed and enforced as if such illegal, invalid or unenforceable
provision never comprised a part hereof; and the remaining provisions hereof
shall remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance here from. Furthermore,
in lieu of such illegal, invalid or unenforceable provision, there shall be
added automatically as part of this Agreement a provision as similar in its
terms to such illegal, invalid, or unenforceable provision as may be possible
and be legal, valid and enforceable.
SECTION 8.06. SURVIVAL OR REPRESENTATION, WARRANTIES AND COVENANTS. The
representations, warranties and covenants contained herein shall survive the
Closing and all statements contained in any certificate, exhibit or other
instrument delivered by or on behalf of the Corporation, Sellers or Purchaser,
as the case may be, and, notwithstanding any provision in this Agreement to the
contrary, shall survive the Closing for a period of one year.
SECTION 8.07. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE SUBSTANTIVE LAWS
PAGE 20
(BUT NOT THE RULES GOVERNING CONFLICTS OF LAWS) OF THE STATE OF TEXAS.
SECTION 8.08. CAPTION. The captions in this Agreement are for convenience of
reference only and shall not limit or otherwise affect any of the terms or
provisions hereof.
SECTION 8.09. GENDER AND NUMBER. When the context requires, the gender of all
words used herein shall include the masculine, feminine and neuter and the
number of all words shall include the singular and plural.
SECTION 8.10. REFERENCE TO AGREEMENT. Use of the words "herein", "hereof",
"hereto" and the like in this Agreement shall be construed as references to this
Agreement as a whole and not to any particular Article, Section or provision in
this Agreement, unless otherwise noted.
SECTION 8.11. NOTICE. Any notice or communication hereunder or in any agreement
entered into in connection with the transactions contemplated hereby must be in
writing and given by depositing the same in the United States mail, addressed to
the party to be notified, postage prepaid and registered or certified with
return receipt requested, or by delivering the same in person. Such notice shall
be deemed received on the date on which it is hand delivered or on the third
business day following the date on which it is to be mailed. For purposes of
notice, the addresses of the parties shall be:
If to Seller: Xxxxxxx Xxxx
Plastic Pallet Production, Inc.
0000 X. Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
PAGE 21
If to Purchaser: Xxxxx Xxxxxx
Cabec Energy Corporation
X.X. Xxx 0000
Xxxxxx, Xxxxx 00000
Any party may change its address for notice by written notice given to the other
parties in accordance with this Section.
Signed this 26th day of September 1997.
PURCHASER:
CABEC ENERGY CORP.
By: /s/ Xxxxx Xxxxxx
------------------------------------
Xxxxx Xxxxxx, President
SELLER:
By: /s/ Xxxxxxx Xxxx
------------------------------------
Xxxxxxx Xxxx
CORPORATION:
PLASTIC PALLET PRODUCTION, INC.
By: /s/ Xxxxxxx Xxxx
------------------------------------
Xxxxxxx Xxxx, President
PAGE 22
SCHEDULE 2.06 - SUBSIDIARIES OF PLASTIC PALLET PRODUCTIONS, INC.
1) MMP, Inc., a Florida corporation
2) PPSE, Inc., a Florida corporation
3) PP Systrans, Inc., a Texas corporation
PAGE 23
SCHEDULE 2.18 - BROKERS RETAINED BY CORPORATION AND SELLERS
PAGE 24
SCHEDULE 2.20 - PATENTS OWNED BY PLASTIC PALLET PRODUCTION, INC.
PAGE 25
SCHEDULE 3.05 - SUBSIDIARIES OF CABEC ENERGY CORP.
1) Fleur-Xxxxx Corporation, a Texas corporation
2) Wyoming Pipe and Tool, Inc., a Wyoming corporation
3) Xxxxxx Manufacturing Corporation, a Texas corporation
4) CEC Operating
PAGE 26
SCHEDULE 3.13 - BROKERS RETAINED BY PURCHASER
PAGE 27
AMENDMENT TO STOCK EXCHANGE AGREEMENT
THIS AMENDMENT TO STOCK EXCHANGE AGREEMENT (the "Amendment") is made
and entered into this 10th day of December, 1997, by and among Cabec Energy
Corp. ("Purchaser"), a Delaware corporation, Xxxxxxx Xxxx, ("Seller"), and
Plastic Pallet Production, Inc. (the "Corporation"), a Florida corporation.
WHEREAS, by that certain Stock Exchange Agreement (the "Agreement")
dated to be effective as of December 1, 1997 Seller agreed to sell and convey to
Purchaser, upon the terms and conditions therein contained, all of the issued
and outstanding stock of the Corporation, which Agreement is fully incorporated
herein by reference for all purposes; and
WHEREAS, the parties hereto desire to amend and modify the Agreement as
set forth herein.
NOW, THEREFORE, for and in consideration of the sum of Ten and No/100
Dollars ($10.00) and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and confessed, the parties hereby
agree as follows:
1. The Agreement is hereby amended by deleting the first
paragraph of said Agreement in its entirety and substituting therefor the
following:
This Agreement (the "Agreement"), dated as of
December 1, 1997, by and among Plastic Pallet Production,
Inc., a Florida corporation (the "Corporation"), Xxxxxxx Xxxx
("Seller"), the sole shareholder of the Corporation, and Cabec
Energy Corp., a Delaware corporation (the "Purchaser").
PAGE 1
2. The Agreement is hereby amended by deleting Section 1.02 in
its entirety and substituting therefor the following:
SECTION 1.02 PURCHASE PRICE AND PAYMENT. In consideration of the sale
of the Stock to Purchaser, Purchaser shall deliver to the Seller at the
Closing an aggregate of 101,000,000 shares (the "Purchaser Shares") of
its Common Stock, $0.10 par value per share ("Purchaser Common Stock").
3. The Agreement is hereby amended by deleting Section 1.03 in
its entirety and substituting therefor the following:
SECTION 1.03. CLOSING. The exchange of shares contemplated herein (the
"Closing") shall take place at the offices of the Corporation on
December 10, 1997, or at such other time or place as may be mutually
agreed upon by the parties. The date on which the Closing occurs shall
be referred to herein as the "Closing Date".
4. The Agreement is hereby amended by adding the following
sentence to the end of Section 2.06:
Notwithstanding any other provision to the contrary contained herein,
the Seller and the Corporation shall be liable for any and all debts,
obligations, taxes, and/or any other assessable costs (including, but
not limited to, lawsuits, ad valorem taxes, and other matters) related
to the Corporation and/or any of the Corporation's subsidiaries up to
and through the Closing Date.
5. The Agreement is hereby amended by deleting the last sentence
of Section 2.07 in its entirety and substituting therefor the following:
PAGE 2
To the best of Seller's and the Corporation's knowledge, the
Corporation has complied with all laws, regulations, and licensing
requirements and has filed with the proper authorities all necessary
statements and reports.
6. The Agreement is hereby amended by deleting Section 3.02 in
its entirety and substituting therefor the following:
SECTION 3.02 CAPITALIZATION. The authorized capital stock of the
Purchaser will consist, on the Closing Date, of (i) 200,000,000 shares
of common stock, $0.10 par value per share, of which 31,900,321 shares
will be issued and outstanding (the "Outstanding Purchaser Stock"), and
(ii) 20,000,000 shares of preferred stock, par value $0.0001 per share,
of which 5,036,607 shares will be issued and outstanding. All of the
issued and outstanding shares of capital stock of the Purchaser are
duly authorized, validly issued, fully paid, and nonassessable. Except
as set forth above, as referenced in Section 5.01 (c), and in the
Purchaser's corporate records, there exists no other options, warrants,
subscriptions, or other rights to purchase, or securities convertible
into or exchangeable for, the capital stock of the Purchaser. The
Purchaser is not a party to or bound by, nor does it have any knowledge
of, any agreement, instrument, arrangement, contract, obligation,
commitment, or understanding of any character, whether written or oral,
express or implied, related to the sale, assignment, encumbrance,
conveyance, transfer, or delivery of any capital stock of the
Purchaser. No shares of capital stock of the Purchaser have been issued
or disposed of in violation of the preemptive rights of any of the
Purchaser's shareholders.
PAGE 3
7. The Agreement is hereby amended by adding the following
sentence to the end of Section 3.05:
Notwithstanding any other provision to the contrary contained herein,
the Purchaser and/or its subsidiaries shall be liable for any and all
debts, obligations, taxes, and/or any other assessable costs
(including, but not limited to, lawsuits, ad valorem taxes, and other
matters) related to any of the Purchaser's subsidiaries up to and
through the Closing Date.
8. The Agreement is hereby amended by deleting the last sentence
of Section 3.06 in its entirety and substituting therefor the following:
To the best of the Purchaser's knowledge, the Purchaser has complied
with all laws, regulations, and licensing requirements and has filed
with the proper authorities all necessary statements and reports.
9. The Agreement is hereby amended by deleting Subsection A of
Section 4.01 in its entirety and substituting therefor the following:
A. Seller acknowledges and agrees that on or
after the Closing Date, the capital stock or assets
of the Purchaser subsidiaries (Fleur-Xxxxx
Corporation, Wyoming Pipe & Tool Corp., Xxxxxx
Manufacturing Corporation and any related interest,
and CEC Operating Corp. as shown on Schedule 3.05)
will be spun off or sold (the format of such spin off
or sale shall be at the sole and absolute discretion
of the Purchaser) and the proceeds distributed to the
shareholders of record of the Outstanding Purchaser
Stock and not to the Seller (or his permitted
assigns) with
PAGE 4
respect to the Purchaser Shares, and Seller
further agrees to authorize and consent to such
transactions.
10. The Agreement, amended hereby, embodies the entire agreement
between the parties hereto, supersedes all prior agreements and understandings,
if any, relating to the subject matter hereof, and may be amended or
supplemented only by an instrument in writing executed by the party against whom
enforcement is sought.
11. The Agreement and the Amendment shall be governed by and
construed in accordance with the laws of the State of Texas.
12. This Amendment shall be binding upon and shall inure to the
benefit of the parties hereto and their respective heirs, executors,
administrators, legal representatives, successors, and assigns.
13. This Amendment has been executed in multiple counterparts,
each copy of which is deemed to be an original and constitute collectively one
document.
EXECUTED to be effective as of the date first above written.
PURCHASER:
CABEC ENERGY CORP.,
a Delaware corporation
By: /s/ Xxxxx Xxxxxx, Xx.
------------------------------------
Xxxxx Xxxxxx, Xx.
PAGE 5
SELLER:
/s/ Xxxxxxx Xxxx
------------------------------------
XXXXXXX XXXX
CORPORATION:
PLASTIC PALLET PRODUCTION,
a Florida corporation
By: /s/ Xxxxxxx Xxxx
------------------------------------
Xxxxxxx Xxxx, President
PAGE 6
