AGREEMENT
Exhibit 4.3
This Agreement (the “Agreement”) is effective as of November 30, 2005 (the “Effective Date”)
by and between Nortia Capital Partners, Inc., a Nevada corporation (the “Purchaser”) and
All-American Pet Company Inc., a New York corporation (collectively with any successor in interest
by merger, the “Company”). For purposes of this Agreement, each of the Purchaser and the Company
shall be referred to individually as a “Party” and both of them shall be referred to collectively
as the “Parties”.
In consideration of the premises and the covenants and representations set forth herein, and
for other good and valuable consideration, the Parties, intending to be legally bound, agree as
follows:
1. Definitions
1.1 Agreement shall have the meaning set forth in the Preamble.
1.2 Asserted Liability shall have the meaning set forth in Section 8.3.
1.3 Company shall have the meaning set forth in the Preamble.
1.6 Common Stock shall have the meaning set forth in Section 2.
1.7 Effective Date shall have the meaning set forth in the Preamble.
1.8 Financial Statements shall have the meaning set forth in Section 4.4(a).
1.9 GAAP shall mean generally accepted United States accounting principles.
1.10 Governmental Body shall mean:
(a) nation, state, county, city, town, village, district, or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign, or other government;
(c) governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other tribunal);
(d) multi-national organization or body; or
(e) body exercising, or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power of any nature.
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1.12 Indemnified Party shall have the meaning set forth in
Section 9.3.
1.13 Indemnifying Party shall have the meaning set forth
in Section 9.3.
1.14 Losses shall mean losses, claims, damages of every type, nature or description,
fines, penalties, Taxes incurred for which indemnification may be sought pursuant to Section 9
hereof, including related costs and expenses which include but are not limited to attorneys’
fees, court costs, accountant’s fees and costs, proof of claim expenses, expert witness fees and
costs, remediation costs, and reasonable fees and disbursements of counsel.
1.15 New Securities shall have the meaning set forth in Section 6.5(b).
1.16 Notice shall have the meaning set forth in Section 10.2.
1.17 Parties shall have the meaning set forth in the Preamble.
1.18 Person shall mean any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint venture, estate,
trust, association, organization, labor union, or other entity or Governmental Body.
1.19 Purchase Price shall have the meaning set forth in Section 3.2.
1.20 Purchaser shall have the meaning set forth in the Preamble.
1.21 Registration Statement shall have the meaning set forth in Section 6.2.
1.22 Reorganization shall have the meaning set forth in Section 2.
1.23 Securities Act shall mean the Securities Act of 1933, as amended, or any
successor law, and regulations and rules issued pursuant to that Act or any successor law.
1.24 Shares shall have the meaning set forth in
Section 3.1.
2. Maryland Reorganization. The Company hereby agrees to file Articles of
Incorporation in the State of Maryland that shall provide for authorized capital of 50,000,000
shares of common stock with $.001 par value (the “Common Stock”) and 10,000,000 shares of preferred
stock with $.001 par value. Upon confirmation from the Secretary of State of the State of Maryland
that the Articles of Incorporation have been filed, the Company hereby agrees to file Articles of
Merger with the Secretary of State of the State of New York and the State of Maryland, pursuant to
which the Company will merge with and into the newly created Maryland corporation (the
“Reorganization”).
3. Purchase And Sale Of Shares.
3.1 Purchase And Sale. Upon completion of the Reorganization, the Company agrees to
issue and to the Purchaser, and the Purchaser agrees to purchase from
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the Company, an aggregate of 750,000 shares (the “Shares”) of Common Stock and options to
purchase 500,000 shares of Common Stock at an exercise price of $.50 per share. The option shall
expire on November 30, 2007.
3.2 Purchase Price. The purchase price for the Shares shall be an aggregate of
$100,000 (the “Purchase Price”). The Purchaser shall pay the Purchase Price by check delivered to
the Company or by a wire transfer to a bank selected by the Company pursuant to wire transfer
instructions to be delivered by the Company. Upon receipt of the Purchase Price, the Company shall
deliver to the Purchaser a stock certificate or certificates representing the Shares.
4. Representations of the Company. Seller represents and warrants to Purchaser as of
the Effective Date:
4.1 Organization and Good Standing.
(a) The Company is a corporation duly organized, validly existing, and in good standing under
the laws of the State of New York, with full corporate power and authority to conduct its business
as it is now being conducted, to own or use the properties and assets that it purports to own or
use.
(b) The Company has delivered to the Purchaser complete and correct copies of the Company’s
Articles of Incorporation and By-laws as currently in effect, and such Articles of Incorporation
and By-laws have not been amended, corrected, restated or superseded in any way. The Company is
not in violation, nor has it taken any action in violation, of any provisions of its Articles of
Incorporation or By-laws. The Company has delivered to the Purchaser minutes of all of the
Company’s board of directors and stockholders meetings, all of which are complete and accurate as
of the date of the Effective Date.
4.2 Authority; No Conflict.
(a) This Agreement constitutes a legal, valid, and binding obligation of the Company,
enforceable against the Company in accordance with its terms. The Company has the absolute and
unrestricted right, power, authority, and capacity to execute and deliver this Agreement and to
perform its obligations under this Agreement.
(b) Neither the execution and delivery of this Agreement nor the consummation or performance
of any of the transactions contemplated hereby will, directly or indirectly (with or without notice
or lapse of time): (i) contravene, conflict with, or result in a violation of (A) any provision of
the Company’s Articles of Incorporation or By-laws, or (B) any resolution adopted by the board of
directors or the stockholders of the Company; or (ii) contravene, conflict with, or result in a
violation of, or give any Governmental Body or other Person the right to challenge any of the
transactions contemplated hereby.
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4.3 Capitalization; Shareholders.
(a) The authorized equity securities of the Company consists of 100 shares common stock, of
which 100 shares are issued and outstanding. All of the Company’s outstanding shares of common
stock have been duly authorized and validly issued and are fully paid and nonassessable.
(b) The Company has delivered to the Purchaser a complete and correct list of all the
shareholders of the Company, including the number of shares of common stock each shareholder owns.
4.4 Financial Statements. The Company has delivered to the Purchaser unaudited
financial statements of the Company, as of and for the ten-month period ended October 31, 2005
(including the notes thereto, if any, the “Financial Statements”). The Financial Statements are
complete and correct in all material respects as of their respective dates and have been prepared
in accordance with GAAP. The Financial Statements fairly present the financial condition and
operating results of the Company at the dates and during the periods indicated therein (subject, in
the case of unaudited statements, to normal year-end adjustments).
4.5 Books and Records. The books of account, minute books, stock record books, and
other records of the Company, all of which have been made available to the Purchaser, are complete
and correct and have been maintained in accordance with sound business practices. The minute book
of the Company contains accurate and complete records of all meetings held of, and corporate action
taken by, the stockholders and the boards of directors, and no meeting of any such stockholders or
board of director has been held for which minutes have not been prepared and are not contained in
such minute books.
5. Representations Of Purchaser. The Purchaser represents and warrants to the Company
as of the Effective Date:
5.1 Authority; No Conflict.
(a) This Agreement constitutes a legal, valid, and binding obligation of the Purchaser,
enforceable against the Purchaser in accordance with its terms. The Purchaser has the absolute and
unrestricted right, power, authority, and capacity to execute and deliver this Agreement and to
perform its obligations under this Agreement.
(b) Neither the execution and delivery of this Agreement nor the consummation or performance
of any of the transactions contemplated hereby will, directly or indirectly (with or without notice
or lapse of time): (i) contravene, conflict with, or result in a violation of (A) any provision of
the Purchaser’s Articles of Incorporation or By-laws, or (B) any resolution adopted by the board of
directors or the stockholders of the Purchaser; or (ii) contravene, conflict with, or result in a
violation of, or give any Governmental Body or other Person the right to challenge any of the
transactions contemplated hereby.
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5.2 Access to Information. The Purchaser has had the opportunity to discuss the sale
of the Shares with the Company, and the Purchaser has obtained or been given access to all
information concerning the Company that the Purchaser has requested.
5.3 Investment Intent. The Purchaser is acquiring the Shares for its own account and
not with a view to distribution of the Shares within the meaning of Section 2(11) of the Securities
Act.
6. Covenants
6.1 Access and Investigation. The Company and its representatives shall:
(a) afford the Purchaser and its representatives full and free access to Company’s personnel,
properties, contracts, books and records, and other documents and data;
(b) furnish the Purchaser with copies of all such contracts, books, records and other existing
documents and data as the Purchaser may reasonably request; and
(c) furnish the Purchaser with such additional financial, operating, and other data and
information as the Purchaser may reasonably request.
6.2 Registration Statement. The Company shall, within 120 days after the issuance of
the Shares, file a registration statement with the United States Securities and Exchange Commission
(the “Registration Statement”).
6.3 Public Relations/Investor Relations. The Company shall, not later than the
effective date of the Registration Statement, enter into an agreement with an investor
relations/public relations firm, approved by the Purchaser in its reasonable discretion, to provide
the Company investor and public relations services for a period of at least 12 months.
6.4 Reverse Split. The Company agrees that for a period of one year following the
issuance of the Shares it shall not effect a reverse split of the Common Stock.
6.5 Pre-Emptive Rights.
(a) The Purchaser shall have a right of first refusal to purchase all or any part of its pro
rata share of New Securities (as defined below) that the Company may, from time to time, propose to
sell and issue, subject to the terms and conditions set forth below. The Purchaser’s pro rata
share, for purposes of this Section 6.5, shall equal a fraction, the numerator of which is
the number of shares of Common Stock then held by it on a fully diluted basis and the denominator of which is the total number of outstanding shares of Common
Stock of the Company on a fully diluted basis.
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(b) “New Securities” shall mean any capital stock of the Company, whether now
authorized or not, and rights, options, or warrants to purchase capital stock and securities of any
type whatsoever that are, or may become, convertible into capital stock, provided,
however, that the term “New Securities” does not include (i) securities issued for the
acquisition of another entity by the Company, whether by merger, purchase of substantially all the
assets of such entity, or other reorganization; (ii) shares of capital stock issued to employees,
directors or consultants of the Company pursuant to a stock option plan approved by the Company’s
board of directors; (iii) securities issued as a result of any stock split, stock dividend, or
reclassification of Common Stock, distributable on a pro rata basis to all holders of Common Stock;
and (iv) securities issued upon exercise, conversion or exchange of any existing securities of the
Company.
(c) In the event the Company intends to issue New Securities, it shall give the Purchaser
written notice of such intention, describing the type of New Securities to be issued, the price
thereof, and the general terms upon which the Company proposes to effect such issuance. The
Purchaser shall have 20 days from the date of any such notice to agree to purchase all or part of
its pro rata share of such New Securities for the price and upon the general terms and conditions
specified in the Company’s notice by giving written notice to the Company stating the quantity of
New Securities to be so purchased.
(d) In the event the Purchaser fails to exercise the foregoing right of first refusal with
respect to its pro rata portion of any New Securities within such 20 day period, the Company may
within 90 days thereafter sell any or all of the Purchaser’s pro rata portion of its New Securities
not agreed to be purchased by the Purchaser, at a price and upon general terms no more favorable to
the purchasers thereof than specified in the notice given to the Purchaser pursuant to paragraph
(c) of this Section 6.5. In the event the Company has not sold such New Securities within
such 90-day period, the Company shall not thereafter issue or sell any New Securities without first
offering such New Securities to the Purchaser in the manner provided above.
(e) The failure of the Purchaser to exercise its rights under this Section 6.5 as to
any specific transaction involving the sale of New Securities shall not prejudice or terminate such
rights as to any other transaction involving the sale of New Securities, it being understood that
the Purchaser’s exercise of its rights under this Section 6.5 as to any transaction
involving the sale of New Securities shall not be a condition to its right to exercise such rights
as to any subsequent transaction involving the sale of New Securities.
6.6 Recapitalization, Exchanges, etc. In the event that any Common Stock or other
securities are issued in respect of, in exchange for, or in substitution of, any shares of Common
Stock, by reason of any reorganization, recapitalization, reclassification, merger, stock dividend,
distribution to shareholders or any other change in the capital structure of the Company, the term
Common Stock as used herein shall be deemed to include all shares of such Common Stock or other
securities, as appropriate, so as to fairly
and equitably preserve, as far as practicable, the original rights and obligations of the
Purchaser.
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7. Conditions to the Purchaser’s Obligation to Purchase the Shares.
The Purchaser’s obligation to purchase the Shares and to take the other actions required to be
taken by the Purchaser is subject to the satisfaction, on or prior to the issuance of the Shares,
of each of the following conditions (any of which may be waived by the Purchaser, in whole or in
part):
7.1 Company’s Performance. All of the covenants and obligations that the Company are
required to perform or to comply with pursuant to this Agreement at or prior to the issuance of the
Shares must have been duly performed and complied with in all material respects.
7.2 Financial Statements. The Company has delivered the Financial Statements to the
Purchaser.
7.3 Satisfactory Diligence. The Purchaser shall have concluded its due diligence
investigation of the Company and its business and all other matters related to the foregoing, and
shall be satisfied, in its reasonable discretion, with the results thereof.
8. Conditions to the Company’s Obligation to Issue the Shares.
The Company’s obligation to deliver the Shares and to take the other actions required to be
taken by the Company is subject to the satisfaction of each of the following conditions (any of
which may be waived by the Company, in whole or in part):
8.1 Accuracy of Representations. All of the Purchaser’s representations and
warranties in this Agreement must be accurate in all material respects as of the date the Shares
are issued.
8.2 Company’s Performance. All of the covenants and obligations that the Company are
required to perform or to comply with pursuant to this Agreement prior to issuing the Shares must
have been duly performed and complied with in all material respects.
9. Indemnification
9.1 Indemnification by the Company. Subject to the limitations set forth in this
Section 9, the Company shall indemnify, defend, save and hold the Purchaser and its
affiliates, officers, directors, shareholders, employees, agents, representatives, successors
and assigns, harmless from and against any and all Losses incurred by the Purchaser arising out of:
(a) any breach of any representation or warranty made by the Company in this Agreement; and (b) any
breach of any covenant or agreement made by the Company in or pursuant to this Agreement.
9.2 Indemnification by Purchaser. Subject to the limitations set forth in this
Section 9, the Purchaser shall indemnify, defend, save and hold the Company, and its
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affiliates, officers, directors, shareholders, members, agents representatives, successors and
assigns, harmless from and against any and all Losses incurred by the Company arising out of: (a)
any breach of any representation or warranty made by the Purchaser in this Agreement; or (ii) the
Purchaser’s breach of any covenant or agreement made by the Purchaser in or pursuant to this
Agreement.
9.3 Notice of Claims. If the Purchaser or the Company (each, an “Indemnified Party”)
believes that it has suffered or incurred any Losses for which it is entitled to indemnification
under this Section 9, such Indemnified Party shall so notify the Party from whom
indemnification may be claimed (the “Indemnifying Party”) as promptly as practicable, but in any
event within 30 calendar days of the date the Indemnified Party obtained actual knowledge of any
Losses. If any claim is instituted by or against a third party with respect to which any
Indemnified Party intends to claim indemnification under this Section 9, such Indemnified
Party shall as promptly as practicable, but in any event within 30 calendar days of the date the
Indemnified Party obtained actual knowledge, notify the Indemnifying Party of such claim. All
notices provided hereunder by the Indemnified Party to the Indemnifying Party shall describe the
claim (the “Asserted Liability”) in reasonable detail and shall indicate the amount (or an
estimate) of the Losses that have been or may be suffered by the Indemnified Party. The failure of
an Indemnified Party to give any notice required by this Section 9.3 shall not affect any
of the Indemnified Party’s rights under this Section 9 or otherwise except and to the
extent that such failure is prejudicial to the rights or obligations of the Indemnifying Party.
9.4 Opportunity to Defend Third Party Claims. If any action is brought by a third
party against any Indemnified Party, the Indemnifying Party shall be entitled, at its own expense:
(a) to participate in such action and (b) upon notice to the Indemnified Party made at any time
during the course of any such claim, suit, action or proceeding, to assume the defense thereof;
provided, however, (i) the Indemnifying Party’s counsel is reasonably satisfactory to the
Indemnified Party, (ii) the Indemnifying Party shall keep the Indemnified Party informed, on a
regular basis, of the status of such claim, suit, action or proceeding and (iii) the Indemnifying
Party shall consult with the Indemnified Party upon the Indemnified Party’s reasonable request for
such consultation from time to time with respect to such claim, suit, action or proceeding. The
Indemnified Party shall cooperate with respect to any such participation, defense, settlement or
compromise. The Indemnified Party shall have the right to employ its own counsel in any such case,
but the fees and expenses of the Indemnified Party’s counsel shall be at the sole expense of the
Indemnified Party unless: (l) the Indemnifying Party shall have authorized in writing employment
of such counsel at the expense of the Indemnifying Party; (m) the Indemnifying Party shall not have
employed
counsel reasonably satisfactory to the Indemnified Party to defend such action within 30 days
after the Indemnifying Party received notice of the Asserted Liability; (n) the Indemnified Party
shall have reasonably determined that the Indemnifying Party is not diligently pursuing such action
or is not keeping the Indemnified Party reasonably informed of the status of such action; or (o)
the Indemnified Party shall have reasonably concluded that a conflict of interest exists between
the Indemnified Party and the Indemnifying Party, in any of which events the fees and expenses of
one additional counsel shall be borne by the Indemnifying Party. The Indemnifying Party shall not
settle or compromise any action or
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consent to the entry of a judgment without the written consent
of the Indemnified Party (which shall not be unreasonably withheld) that: (x) does not provide for
the claimant to give an unconditional release to the Indemnified Party in respect of the Asserted
Liability; (y) involves relief other than monetary damages; or (z) places restrictions or
conditions on the operation of the business of the Indemnified Party. The Indemnifying Party shall
not be liable for any settlement of any claim or action effected without its written consent.
After payment of any Asserted Liability by the Indemnifying Party, the Indemnified Party, if
requested by the Indemnifying Party, shall assign to the Indemnifying Party all rights the
Indemnified Party may have against any applicable account debtor or other responsible Person in
respect of the Asserted Liability. If the Indemnifying Party chooses to defend any Asserted
Liability, the Indemnified Party shall make available to the Indemnifying Party any books, records
or other documents within its control that are necessary or appropriate for such defense.
9.5 Payment of Losses. If an Indemnified Party is entitled to indemnification for
Losses hereunder, then the Indemnifying Party shall pay the aggregate amount of such Losses to the
Indemnified Party within 15 calendar days after demand therefor.
9.6 Survival. The representations, warranties, covenants, restrictions and agreements
of the Parties contained in this Agreement or in any certificate delivered pursuant hereto or in
connection herewith shall survive and continue in full force and effect, regardless of any
investigation made by or on behalf of any Party hereto, for a period of one year. No claim
whatsoever may be asserted against an Indemnifying Party hereunder or in connection therewith after
the date that such Indemnifying Party’s indemnification obligations have terminated in accordance
with this Section 9.6.
10. Miscellaneous.
10.1 Entire Agreement. This Agreement constitutes the entire agreement between the
Parties with respect to the subject matter hereof.
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10.2 Notice. Each notice, request, demand, direction or other communication (a
“Notice”) provided for in this Agreement shall be in writing and shall be mailed or delivered
personally or sent by telecopier or facsimile to the applicable Party at the address of such Party
set forth below in this Section 10.2. When mailed, a Notice shall be sent by first class,
certified mail, return receipt requested, enclosed in a postage prepaid wrapper, and shall be
effective on the third business day after it has been deposited in the mail. When delivered
personally, a Notice shall be effective when delivered to the address
for the respective Party set forth in this Section 10.2. When sent by telecopier or
facsimile, a Notice shall be effective on the date such Notice is sent. Each Notice shall be
addressed to the Party to be notified as shown below:
| Purchaser: | Nortia Capital Partners, Inc. | |||||||
| Fax No.: | ||||||||
| Company: | All American Pet Company, Inc. | |||||||
| 00000 Xxxxxxx Xxxx. | ||||||||
| Xxxxx 000 | ||||||||
| Xxxxxx, XX 00000 | ||||||||
| Attn: Xxxxx Xxxxxxxx | ||||||||
| Fax No.: (000) 000-0000 | ||||||||
Either Party may change his or its respective address for purposes of this Section 10.2 by
giving the other Party Notice of the new address in the manner set forth above.
10.3 Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law, and if any
provision of this Agreement shall be or become prohibited or invalid in whole or in part for any
reason whatsoever, that provision shall be ineffective only to the extent of such prohibition or
invalidity without invalidating the remaining portion of that provision or the remaining provisions
of this Agreement.
10.4 Non-Waiver. The waiver of any Party of a breach or a violation of any provision
of this Agreement shall not operate or be construed as a waiver of any subsequent breach or
violation of any provision of this Agreement.
10.5 Amendment. No amendment or modification of this Agreement shall be deemed
effective unless and until it has been executed in writing by the Parties to this Agreement. No
term or condition of this Agreement shall be deemed to have been waived, nor shall there by any
estoppel to enforce any provision of this Agreement, except by a written instrument that has been
executed by the Party charged with such waiver or estoppel.
10.6 Assignment. This Agreement shall be binding upon each of the Parties, and it
shall benefit, respectively, each of the Parties, and their respective successors and assigns.
This Agreement shall not be assignable by any Party. There are no third party beneficiaries to
this Agreement.
10.7 Headings. The headings to this Agreement are for convenience only; they form no
part of this Agreement and shall not affect its interpretation.
10.8 Counterparts. This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute a single instrument.
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10.9 Governing Law. This Agreement shall be construed under and governed by the laws
of the State of Colorado, its rules of conflict of laws notwithstanding.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, this Agreement is executed on the date set forth above.
| NORTIA CAPITAL PARTNERS, INC. | ALL AMERICAN PET COMPANY INC. | |||||||||||||
By:
|
By: | |||||||||||||
Title:
|
Title: | |||||||||||||
| Name (printed): | Name (printed): | |||||||||||||
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