Exhibit 10.12
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT ("Agreement") dated on or as of
________________, 2000 ("Effective Date") is by and between SILVER XXXXXX
MINING, INC., a Delaware corporation ("Purchaser"), and L+R XXXXX, Inc., a Texas
corporation ("Seller").
W I T N E S S E T H:
WHEREAS, Seller is the owner of certain assets described in this
Agreement; and
WHEREAS, Purchaser desires to purchase and Seller desires to sell
substantially all of its assets as hereinafter described or referenced in this
Agreement;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and undertakings herein contained, and other good and valuable consideration,
the receipt and sufficiency of which are hereby mutually acknowledged and
confessed, and subject to the terms and conditions set forth herein, Seller and
Purchaser agree as follows:
1. ACQUISITION.
(a) PURCHASED ASSETS. Subject to and upon the terms and
conditions hereinafter set forth, Seller agrees to grant, bargain, convey, sell,
transfer, assign and deliver to Purchaser, and Purchaser hereby agrees to
purchase from Seller the following (collectively, the "Purchased Assets"):
(i) The inventory and equipment of the business;
(ii) good will of the Seller;
(iii) contracts and receivables;
(iv) software;
(v) advertising materials; and
(vi) trade name.
The parties agree to execute a form of allocation of purchase price at
or prior to Closing which will comply with applicable provisions of the Internal
Revenue Code, and a detailed listing of inventory, equipment and receivables is
attached as Schedule 1.
(b) CONSIDERATION
(i) 50,000 shares of Silver Xxxxxx Mining, Inc.,
common stock, which Seller may convert to $50,000 cash at
seller's option upon Purchaser's conclusion of a private
placement or secondary offering of at least $2,000,000.00 on
or before July 1, 2000.
(ii) $950,000.00 out of the proceeds of a primary or
secondary offering of stock at $1.00 per share.
(iii) It is understood that as to the initial $50,000
payment made in Purchaser's stock, that Purchaser guarantees
that the stock shall have a value of $50,000 on July, 2001, or
it will redeem the stock for $50,000 cash on that date at
Seller's option.
2. CLOSING. Closing shall occur at the offices of Xxxxx Xxxxx, 0000
Xxxxxxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000 at 10:00 a.m. on December 14, 2000,
unless the parties by mutual agreement select a different date or place.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
warrants to Purchaser that:
(a) ORGANIZATION AND STANDING OF SELLER. Seller is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Texas and has full corporate power and authority to conduct
business.
(b) AUTHORITY TO CONTRACT. Seller has the legal power and
right to enter into and perform this Agreement, and the consummation of the
transaction described in this Agreement will not result in the breach or
termination of any agreement, mortgage or instrument to which Seller is bound.
(c) LIABILITIES TO BE PAID BY SELLER. Purchaser is not
obligated for any or Seller's liability nor are any of the assets being
purchased subject to any liabilities which will not be paid by the Seller at
Closing.
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(d) LITIGATION. Except for the matters described in Schedule 2
attached hereto, Seller is not a party to any legal or governmental actions,
claims, suits or judgment, nor does Seller have notice of any claim or suit.
Seller has not filed any bankruptcy or insolvency proceeding.
(e) TAXES. Seller has duly and timely filed all federal,
state, and local tax returns required to be filed, or has made adequate
provision for the payment of all taxes which are due pursuant to any returns.
(f) FINANCIAL STATEMENTS. Seller has furnished to Purchaser
financial statements of Seller as of December 31, 1999 and for the period ending
November 30, 2000, and the related statements of income and cash flow for the
periods therein ("Financial Statements"). The Financial Statements were prepared
in accordance with generally accepted accounting principles, and fairly present
the financial position of Seller during the period indicated. There are no
material liabilities, direct or indirect, fixed or contingent of Seller which
are not reflected in the Financial Statements.
(g) BROKERS. Seller is not a party to or in any way obligated
under a brokerage contract or other agreement and there are no outstanding
claims against Seller for the payment of any broker's or finder's fees in
connection with the origin, negotiation, execution or performance of this
Agreement. Seller agrees to indemnify and hold harmless Purchaser from any and
all liability, for any brokerage commissions, finders fees or similar
obligations contracted for or incurred by Seller.
(h) GOVERNMENTAL LICENSES AND PERMITS: COMPLIANCE WITH LAWS.
The Seller has not received any notice of any revocation or modification or any
license, certificate, tariff, permit, registration, exemption, approval or other
authorization by any Governmental Entity. To the knowledge of the Seller, the
Seller is in compliance with all applicable laws.
Each of the above representations and warranties shall survive Closing.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser represents
and warrants to Seller that:
(a) ORGANIZATION, STANDING AND AUTHORITY OF PURCHASER.
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware, and has
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full corporate power and authority to conduct its business as it is now being
conducted and to enter into and carry out the provisions of this Agreement.
(b) AUTHORIZATION. The execution and delivery of this
Agreement and the performance by Purchaser of its obligations hereunder have
been duly authorized by the Board of Directors of Purchaser, and do not violate
any provisions of the Articles of Incorporation or By-laws of Purchaser.
(c) BROKERS. Purchaser has no outstanding claims against it
for the payment of any broker's or finder's fees in connection with the origin,
negotiation, execution or performance of this Agreement. Purchaser agrees to
indemnify and hold harmless Seller from any and all liability for any brokerage
commissions, finders fees or similar obligations contracted for or incurred by
Purchaser.
5. INDEMNIFICATION BY PURCHASER. Purchaser agrees to defend, indemnify
and hold harmless Seller and its successors or assigns from, against, and in
respect, of any and all loss or damage (including attorneys and accounting fees)
resulting from the operation of the Subject Business and in which the event
giving rise to the occurrence had its inception after transfer of possession of
the Purchased Assets and relates to the operation of the Subject Business by
Purchaser or its agents.
6. INDEMNIFICATION BY SELLER. Seller and X. X. Xxxxx agrees to defend,
indemnify and hold harmless Purchaser and its successors and assigns from,
against, and in respect, of any and all loss or damage (including attorneys and
accounting fees) (i) resulting from the operation of the Subject Business or in
which the event giving rise to the occurrence had its inception before transfer
of possession of the Purchased Assets and relates to the operation of the
Subject business prior to transfer; and (ii) any breach by Seller of the terms
of this Agreement.
7. DEFAULT.
(a) If seller should default under this Agreement, Purchaser's
remedies shall include (1) an action for specific performance of this Agreement,
or (2) monetary damages for breach as permitted by law.
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(b) If Purchaser should default under this Agreement, then
Seller shall be entitled to specific performance, or may select to be released
from all obligations hereunder.
8. EXPENSES. Seller and Purchaser shall each pay its or their own
expenses (including without limitation counsel and accounting fees and expenses)
incident to the preparation and carrying out of this Agreement and the
consummation of the transactions contemplated hereby, except as otherwise
provided for herein.
9. NOTICES. All notices, demands and requests which may be given or
which are required to be given by any party to the others, and any exercise of a
right of termination provided by this Agreement, shall be in writing and shall
be deemed effective when either personally delivered to the intended recipient;
sent by certified or registered mail, return receipt requested, addressed to the
intended recipient at the address specified below; delivered in person to the
address set forth below for the party to which the notice was given; deposited
into the custody of a nationally recognized overnight delivery service such as
Federal Express Corporation, Xxxxx or Purolator, addressed to such party at the
address specified below; or sent by facsimile, telegram or telex, provided that
receipt for such facsimile, telegram or telex is verified by the sender and
followed by a notice sent in accordance with one of the other provisions set
forth above. Notices shall be effective on the date of delivery or receipt or,
if delivery is not accepted, on the earlier of the date that delivery is refused
or three (3) days after the date the notice is mailed. For purposes of this
Section, the addresses of the parties for all notices are as follows (unless
changes by similar notice in writing are given by the particular person whose
address is to be changed):
(a) if to Seller,
L+R Xxxxx, Inc.
Attn: X. X. Xxxxx
0000 Xxxxxx Xxxx, Xxx. 000
Xxxxxx, XX 00000
(b) if to Purchaser,
Silver Xxxxxx Mining, Inc.
Attn: Xxxxxx X. Xxxxxx, President
0000 Xxxxxxx 000X, Xxxxx 000-X
Xxxxx Xxxxxxx, Xxxxx 00000
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Any party hereto may designate a different address by notice given to the other
parties.
10. CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER. The obligations
of Purchaser to close shall be subject to the following conditions:
(a) The representations and warranties of Seller contained in
this Agreement shall be true on and as of the Closing Date.
(b) On the Closing Date, Seller shall have executed and
delivered all necessary instruments of transfer required to permit Purchaser to
run the business, including, but not limited to any assignment of marks and
intellectual property, telephone numbers, leases and of any xxxx of sale.
11. COVENANT AGAINST COMPETITION.
(a) For a period of four years following the date of Closing
Seller and its principal owner X. X. Xxxxx, shall not (i) directly or indirectly
conduct or have any beneficial ownership or equity interest in any Competing
Business operating within Purchaser's area of influence, which is within the
geographic area in which Silver Xxxxxx Mining, Inc. or L+R Xxxxx operates, or
has commenced business activity, whether such interest is structured as a
partner, shareholder, beneficiary, or otherwise, or have any right, option,
agreement, understanding, or arrangement to acquire any such interest; (ii)
solicit, divert, or appropriate, or attempt to solicit, divert, or appropriate
to or for a Competing Business the business of any person or entity located
within the Area which was a customer of the company (or within one year prior to
the Closing Date), (iii) induce or attempt to induce any of companies' business
contacts to curtail its orders or cancel its business, (iv) induce or attempt to
induce any employee of companies to terminate or modify their employment
arrangement. For the purposes of this Section 11, "Competing Business" means any
business which is engaged in the business of International Employment Testing
software.
(b) If Seller commits a breach, or threatens to commit a breach of the
provisions of subsection (a) above, Purchaser shall have the right and remedy to
have the provisions of subsection specifically enforced by any court having
jurisdiction, it being acknowledged and agreed that any such breach or
threatened breach will cause irreparable injury to Purchaser and that money
damages will not provide remedy to Purchaser.
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(c) If any of the covenants contained in subsection (a) above, or any
part thereof, are hereafter construed to be invalid or unenforceable, the same
shall not affect the remainder of the covenant or covenants, which shall be
given full effect, without regard to the invalid portions. If any of the
covenants contained in subjection (a) above, or any part thereof, are held to be
unenforceable because of the scope or duration of such provision of the
geographic area covered thereby, the parties agree that the court making such
determination shall have the power to reduce the scope, duration, or area of
such provision and, in its reduced form, said provision shall then be
enforceable.
12. MISCELLANEOUS.
(a) ASSIGNMENT. This Agreement may not be assigned by any
party hereto without the consent of the other parties.
(b) PRORATION OF TAXES AND ADJUSTMENTS. All state and local
personal property taxes relating to the Purchased Assets shall be prorated
between Purchaser and Seller as of the Transfer of Possession of Subject
Business.
(c) SECTION AND PARAGRAPH HEADINGS. The Section and Paragraph
headings of this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. Whenever the context
permits, singular shall include plural and one gender shall include all. Notice
given by or to the attorney for any party shall be as effective as if given by
or to that party.
(d) AMENDMENT. This Agreement may be amended only by an
instrument in writing executed by the parties hereto.
(e) ENTIRE AGREEMENT. If any provision of this Agreement is
held invalid or unenforceable, it is the intent of the parties that all other
provisions remain fully valid. This Agreement and the exhibits, schedules,
certificates, and documents referred to herein constitute the entire agreement
of the parties, and supersede all understandings with respect to the subject
matter hereof.
(f) COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
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(g) GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS AND DEEMED
PERFORMABLE IN THE STATE OF TEXAS.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties as of the date and year first above written.
PURCHASER:
SILVER XXXXXX MINING, INC.
By:
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SELLER:
L+R XXXXX, INC.
By:
--------------------------
By:
--------------------------
X. X. Xxxxx, Personally
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SCHEDULE 1 (a) (i)
PROPERTY/ASSET DESCRIPTIONS
(To be updated within 3 days of Closing)
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SCHEDULE 1 (a) (ii)
INVENTORY AND EQUIPMENT
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SCHEDULE 2
LITIGATION
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