EXHIBIT 10.1
[GRAPHIC OMITTEED]
STOCK EXCHANGE AGREEMENT
This Stock Exchange Agreement (the "AGREEMENT") dated as of
the __ day of _________, 2001 is by and amongst DUCT 2, Inc., an Ohio
corporation (hereinafter referred to as "Buyer"), DUCT Utility Construction &
Technologies, Inc., a Colorado corporation (hereinafter referred to as "DUCT"),
and, XX Xxxxxx, Inc., a Texas corporation, (the "Company"), Xxxxxxx Xxxxxxxx and
Xxxxxx Xxxxxxxx (hereinafter referred to as the "Shareholders"). The
Shareholders and the Company may jointly be referred to as the "Seller".
WHEREAS, the respective Board of Directors of the Buyer and the Company
deem the acquisition by Buyer of all of the issued and outstanding capital stock
of the Company on the terms set forth in this Agreement to be desirable,
generally for the welfare and advantage of each, and in the best interests of
the shareholders of each; and
WHEREAS, the Buyer is a wholly owned subsidiary of DUCT; and
WHEREAS, the parties desire that this transaction be treated as a
tax-free exchange under section 368 of the Internal Revenue Code.
NOW, THEREFORE, in consideration of the promises and the mutual
agreements and covenants herein contained, and for the purpose of prescribing
the terms and conditions of such acquisition, the mode of carrying it into
effect, and such other details and provisions as are necessary or desirable, the
parties hereto hereby represent, warrant, covenant and agree as follows:
ARTICLE I
PLAN OF AGREEMENT
1.01 Number of Shares and Purchase Price. Subject to the further
conditions of this Agreement and the truth of the representations and warranties
provided herein the Seller agrees to exchange 1,000 shares of the common stock
of Seller, said shares
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representing all of the issued and outstanding shares of common stock of Seller,
for a total of 195,000 shares of unregistered common stock of DUCT. Attached and
marked Exhibit 1.01 is a list of all of the shareholders of the Seller together
with the number of shares of common stock owned by each.
The current shareholders of the Seller shall receive such number of
shares of DUCT shares based upon their equity ownership in the Seller.
The Shareholders who are executing this Agreement shall deliver their
shares of XX Xxxxxx, Inc. duly endorsed for transfer in exchange for their
shares of DUCT.
In addition to the exchange of shares, the Buyer shall pay the
following liabilities as set forth herein:
As to Xxxxxx Xxxxxxxx $119,798.62
As to Xxxxx Xxxx $38,000
The foregoing shall be payable by Buyer nine months following the date
of closing. Interest on the outstanding principal balance shall accrue at the
rate of 8% per annum.
The Company has not incurred any liabilities in excess of $5,000 since
the June 30, 2001 Balance Sheet that is attached hereto as Exhibit 2.02. To the
extent that the Buyer becomes obligated for any liabilities in excess of $5,000
that are not set forth on the June 30, 2001 balance sheet, Buyer shall have the
right to offset those amounts due Xxxxxxxx and Xxxx. Attached and marked Exhibit
1.01(b) is consents by Xxxxxxxx and Xxxx to the terms set forth herein.
1.02 Employment. In addition to the exchange of shares and as a
material inducement for the Shareholders entering into this Agreement, it is
contemplated that immediately following the closing the Buyer shall enter into
employment agreements with Xxxx Xxxxxxxx, Xxxxxx Xxxxxxxx, and Xxxxxx Xxxxxx at
$75,000 per year. These employees will continue to be employed by the Seller. In
addition to the annual compensation, the Shareholders shall be entitled to
participate in such benefit plans as are generally available to the employees of
the Seller then in effect.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
AND THE SHAREHOLDERS
The Seller and its shareholders represent and warrant to Buyer that:
2.01 Incorporation, Common Stock, Etc. The Company is a corporation
duly organized and existing in good standing under the laws of the State of
Texas. Attached hereto, as Exhibit 2.01, is a copy of the Company's good
standing certificate. The Company has full corporate power and authority to
carry on its business as it is now being conducted and to own and operate its
assets, businesses and properties. Company has authorized capital stock
consisting of 100,000 shares of Common Stock, par value $1.00 per share, of
which 1,000 shares are issued and outstanding. There are no preferred shares
authorized. There are and at the Closing will be no outstanding subscriptions,
options, warrants, convertible securities, calls, commitments or agreements
calling for or requiring issuance or transfer, sale or other disposition of any
shares of capital stock of the Company or calling for or requiring the issuance
of any securities or rights convertible into or exchangeable (including on a
contingent basis) for shares of capital stock. All of the outstanding shares of
the Company are duly authorized, validly issued, fully paid and non-assessable.
There are no dividends due, to be paid or are in arrears with respect to any of
the capital stock of Company.
2.02 Company Financial Statements. Attached hereto as Exhibit 2.02 are
the most recent financial statements for the Company dated as of June 30, 2001
and December 31, 2000. Said financial statements include the Company's Balance
Sheet, Income Statement, and Changes in Stockholders Equity. The financial
statements present fairly the financial position of the Company as of the dates
set forth in the financial statements. The financial statements have been
prepared in conformity with generally accepted accounting principles. There has
been no material change in the financial condition since the date of the
financial statements. All liabilities, contingent or otherwise, are set forth in
the financial statements and there are no undisclosed
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liabilities of any kind or nature. Since the date of the financial statements,
the Company has not incurred any liabilities in excess of $5,000 and except as
contemplated by this transaction, there have been no transactions entered into
outside of the usual course of business.
The Seller and the Shareholders, at the expense of DUCT, further agrees
to provide the Buyer within 60 days of closing with certified financial
statements in conformity with Securities and Exchange Commission reporting
requirements. If the Company is unable to provide the required certified
financial statements or, the certified financial statements reflect a material
change in the financial condition of the Company from that which was represented
in the financial statements, then in that event the Buyer may, in its sole and
absolute discretion and in addition to any remedies available at law, rescind
this Agreement.
2.03 Litigation and Liens. Except as set forth in Exhibit 2.03, there
are no actions, suits, proceedings, or investigations pending or, to the best of
its knowledge, threatened or contemplated against the Company, at law or in
equity, before any federal, state, municipal or other governmental department,
commission, board, agency or instrumentality, domestic or foreign. The Company
is not subject to any outstanding judgments or operating under or subject to or
in default with respect to any order, writ, injunction or decree of any court or
federal, state, municipal or other governmental department, commission, board,
agency or instrumentality, domestic or foreign. Attached and marked Exhibit
2.03(b) is a list of all outstanding liens filed against the Company.
2.04 Compliance with Laws. The Company has complied in all
material respects with all laws, regulations, orders, domestic and foreign, and
neither the present uses of their properties nor the conduct of its business
violate any such laws, regulations, orders or requirements, and except as set
forth in Schedule 2.04 (if applicable) the Company has not received any notice
of any claim or assertion that it is not so in compliance.
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2.05 Indebtedness. Except as set forth in the Company Balance Sheet,
the Company has not executed any instruments, entered into any agreements or
arrangements pursuant to which the either has borrowed any money, incurred or
guaranteed any indebtedness or established any line of credit which represents a
liability of the Company as of the date thereof.
2.06 No Material Adverse Change. Since the date of the Company Balance
Sheet, there has not been any material adverse change in the condition,
financial or otherwise, of any aspect of its business taken as a whole; nor has
there been any material transaction entered into by the Company. The Company has
not incurred any material obligations, contingent or otherwise except for legal
and accounting fees and expenses in connection with the transactions
contemplated by this Agreement. There has not been any damage, destruction or
loss, whether or not covered by insurance adversely affecting the Company, its
business, property or assets; nor has the Company (a) created or incurred any
indebtedness; (b) issued, sold, purchased, redeemed or granted any shares of
Company Common Stock or any other securities or any options, warrants or other
rights to purchase any shares of Company Common Stock except as set forth in
Schedule 2.06; (c) amended its Certificate of Incorporation or bylaws, (d) paid
any obligation or liability other than obligations or liabilities reflected in
its Balance Sheet dated as of the Company Balance Sheet Date or incurred any
liabilities except for legal and accounting fees and disbursements incurred in
the ordinary course of business or in connection with this Agreement and the
transactions contemplated hereby.
2.07 No Defaults. Neither the execution nor delivery of this Agreement
nor the consummation of the contemplated transaction are events which, of
themselves or with the giving of notice or passage of time or both, could
constitute a violation of or conflict with or result in any breach of or default
under the terms, conditions or provisions of any judgment, law or regulation of
the Company's Certificate of Incorporation or Bylaws, or of any agreement or
instrument to which the Company is a party or by which it is bound; or could
result in the creation or imposition of any lien, charge or encumbrance of any
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nature whatsoever on the property or assets of Company; and no consent of any
third party except as expressly contemplated herein is required for the
consummation of this Agreement by Company.
2.08 Corporate Action of Company. The Board of Directors of the Company
has duly authorized the execution and delivery of this Agreement. Subject to the
approval of the stockholders of the Company, as provided herein, this Agreement
constitutes a valid, legal and binding agreement of Company and is enforceable
in accordance with its terms.
2.09 Liabilities. As of the date of this Agreement, the Company has not
incurred any liabilities except in the ordinary course of business.
2.10 Taxes. Except as set forth on Schedule 2.10, all federal, state,
and local tax returns, reports and declarations of estimated tax or estimated
tax deposit forms required to be filed by Company. The Company has paid all
taxes which have become due pursuant to such returns or pursuant to any
assessment received by it, and has paid all installments of estimated taxes due;
and all taxes, levies and other assessments which each is required by law to
withhold or to collect have been duly withheld and collected and have been paid
over to the proper governmental authorities. The Company has no knowledge of any
tax deficiency that has been or might be asserted against it which would
materially and adversely affect the business or operations of the Company. Prior
to Closing, The Company shall provide Buyer with copies of all tax returns, of
any kind or nature, filed by Company, together with all accounting information.
2.11 Title to Property; Leases. The Company has good and defensible
title in fee simple to, or valid and enforceable leasehold estates in, all
properties and assets, which are material to its continued operations, free and
clear of all liens, encumbrances, charges or restrictions or are not materially
significant or important in relation to its operations and business. All of such
leases and subleases under which the Company e is the lessor or sublessor,
lessee or sublessee of properties or assets or under which Company holds
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properties or assets as lessee or sublessee are in full force and effect.
Company is not in default in respect of any of the terms or provisions of any of
such leases or subleases, and no claim has been asserted by anyone adverse to
their respective rights as lessor, sublessor, lessee or sublessee under any of
the leases or subleases mentioned above, or affecting or questioning their
respective rights to continued possession of the leased or subleased premises or
assets under any such lease or sublease; and Company either owns or leases all
such properties as are necessary to its operations as now conducted.
Attached hereto and marked Exhibit 2.11 is a list of all assets owned
by the company including all tangible and intangible assets and assets owned
through any subsidiaries.
2.12 Licenses. The Company has obtained all required licenses, permits
or other governmental authorization for the conduct of its business as now being
conducted. The Company is in compliance with all laws governing the operation of
its business in any jurisdiction where the Company conducts business.
2.13 Bank Accounts. Attached hereto as Schedule 2.13 is a listing of
all bank accounts and account numbers that are currently held by the Company. At
Closing, the Company shall deliver to Buyer Board minutes approving Xxxxxxx X.
Xxxx as a signatory to the bank account and removing any of the other named
signatories.
2.14 Contracts and Commitments. Except as set forth in Exhibit 2.14,
there are neither contracts nor commitments of the Company requiring any future
payment to an officer, director, employee, agent or shareholder of Company. Also
attached and marked as Exhibit 2.14(b) is a list of all current employees and
the salary of each.
2.15 Representations True and Correct. This Agreement and the Schedules
and Exhibits attached hereto do not contain any untrue statement of a material
fact concerning the Company or omits any material fact concerning the Company
which is necessary in order to make the statements therein not misleading. All
of the representations and warranties contained herein (including all statements
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contained in any certificate or other instrument delivered by or on behalf of
the Shareholders pursuant hereto or in connection with the transactions
contemplated hereby) shall survive the Closing.
2.16 Retirement Plans. Neither the Company nor any subsidiary, or
affiliate is obligated under any pension plan, profit sharing or similar
employee benefit plan.
2.17 Intellectual Property Rights. Attached hereto as Exhibit 2.17 is a
list of all trademarks and trade names which are owned by the Company, together
with copies of any official notice from any issuing governing organization.
2.18 Resignations. Attached hereto as Exhibit 2.18 are the resignations
of all of the Company's officers and directors. Said resignations will be held
in escrow pending closing with DUCT.
2.19 Indemnification. The Company and the Shareholders jointly and
individually shall indemnify and hold Buyer, its officers and directors,
harmless of and in respect of:
(1) Any damage or loss resulting from any loss, any liability of
any kind or nature which is not set forth in the financial statements, damage,
misrepresentation, breach of warranty or non-fulfillment on the part of the
Company under this Agreement or from any misrepresentation or omission from any
certificates or other instruments furnished to Company pursuant to this
Agreement.
(2) All actions, suits, proceedings, demands assessments,
judgments, costs and expenses incident to any of the foregoing including
reasonable attorney's fees and all costs incurred by Buyer to enforce this
agreement against Company.
2.20 Environmental Matters. The Company is in full compliance with all
environmental laws and regulations affecting the operation of its business and
the ownership or lease of any real estate. The Company has not improperly
disposed of any hazardous or toxic waste and as of the date of this Agreement
has no toxic or hazardous waste in its possession. The Company has not been
advised of any violation or potential violation of any local or federal rules or
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regulations pertaining to environmental matters. The Company has provided Buyer
with copies of all environmental audits performed to date.
2.21 Further Assurances. That the undersigned shareholder, either alone
or with the assistance of their own professional advisor, has such knowledge and
experience in financial and business matters that the undersigned shareholder(s)
are capable of evaluating the merits and risks of entering into this transaction
and the shares of common stock to be received from DUCT. That this transaction
involves significant investment risk and the undersigned shareholders have the
net worth to undertake such risks;
(b) That the undersigned shareholders have obtained to the extent
deemed necessary, the undersigned's own personal professional advice with
respect to the risks inherent in this transaction, the suitability of entering
into this transaction in light of the undersigned's financial condition and
investment needs;
(c) That the undersigned believe that by entering into this transaction
is suitable for the undersigned based upon the undersigned's investment
objectives and financial needs, and the undersigned has adequate means for
providing for the undersigned's current financial needs and personal
contingencies and has no need for liquidity of the DUCT shares to be received;
(d) That the undersigned shareholder(s) have been given reasonable
opportunity to ask questions of, and receive answers from, representatives of
both Buyer and DUCT concerning the terms and conditions of this Agreement and
that the representatives have answered all questions or supplied the requested
information to the satisfaction of the shareholder(s).
(e) That the undersigned recognizes that the Company has only recently
commenced operations and prior thereto was a "shell" company with no operations.
The Selling shareholders will experience significant dilution as a result of
this transaction.
(f) DUCT is a publicly traded Company. During the past year, the Common
Shares of DUCT have traded between $.15 and $5.00. There can be no assurance
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that any active market can or will be sustained in the DUCT common stock.
Ownership of the DUCT shares may represent an illiquid investment. Not only will
the shares of common stock be subject to Rule 144 as promulgated by the
Securities Act of 1933, as amended, general market conditions may make it
difficult to liquidate the undersigned's investment in the event of an
emergency.
(g) Should any of the undersigned later desire to dispose of or
transfer the Shares in any manner, the Shareholder shall not without first
obtaining the opinion of Company counsel that such disposition or transfer may
be lawfully made without the registration of the Shares or underlying shares of
common stock pursuant to the Securities Act of 1933, as amended, and applicable
state securities laws.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer (DUCT 2) represents and warrants to the Shareholders and the
Company that:
3.01 Incorporation, Common Stock, Etc. Buyer is a corporation duly
organized and existing in good standing under the laws of the State of Ohio. The
Buyer has full corporate power and authority to carry on its business as it is
now being conducted and to own and operate its assets, businesses and
properties. The Buyer (DUCT 2) has authorized capital stock consisting of 1,000
shares of Common Stock, no par value, of which 1,000 shares were outstanding as
of July 26, 2001. All of the outstanding shares of the Buyer are duly
authorized, validly issued, fully paid and non-assessable. There are no
dividends due, to be paid or are in arrears with respect to any of the capital
stock of Buyer. Buyer is a wholly owned subsidiary of DUCT.
3.02 Buyer Financial Statements. Buyer has not yet commenced
operations. Except for organizational expenses advanced by DUCT, it has no
assets and has incurred no liabilities.
DUCT is a public entity that files periodic reports with the Securities
and Exchange Commission. Copies of the DUCT reports are accessible through the
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Commission's Internet website located at xxx.xxx.xxx (in its XXXXX archives). No
warranty or representation of any kind or nature is given as part of this
Agreement regarding the accuracy of the DUCT financial statements or any other
matter contained in the filings.
3.03 Litigation. Except as set forth in Exhibit 3.03, there are no
actions, suits, proceedings, or investigations pending or, to the best of its
knowledge, threatened or contemplated against Buyer at law or in equity, before
any federal, state, municipal or other governmental department, commission,
board, agency or instrumentality, domestic or foreign. The Buyer is not subject
to any outstanding judgments or operating under or subject to or in default with
respect to any order, writ, injunction or decree of any court or federal, state,
municipal or other governmental department, commission, board, agency or
instrumentality, domestic or foreign. DUCT has filed suit in Cincinnati, Ohio in
connection with its acquisition of Star Communication Services, Inc. and may be
subject to a counterclaim.
3.04 Compliance with Laws. The Buyer has complied in all material
respects with all laws, regulations, orders, domestic and foreign, and neither
the present uses by Buyer of its properties nor the conduct of its business
violate any such laws, regulations, orders or requirements, and the Buyer has
not received any notice of any claim or assertion that it is not so in
compliance.
3.05 No Defaults. Neither the execution nor delivery of this Agreement
nor the consummation of the contemplated transaction are events which, of
themselves or with the giving of notice or passage of time or both, could
constitute a violation of or conflict with or result in any breach of or default
under the terms, conditions or provisions of any judgment, law or regulation or
of Buyer's Certificate of Incorporation or Bylaws, or of any agreement or
instrument to which Buyer is a party or by which it is bound; or could result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever on the property or assets of Buyer; and no consent of any third party
except as expressly contemplated herein is required for the consummation of this
Agreement by Buyer.
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3.06 Corporate Action of Buyer. The Board of Directors of the Buyer has
duly authorized the execution and delivery of this Agreement. This Agreement
constitutes a valid, legal and binding agreement of Buyer and is enforceable in
accordance with its terms.
3.07 Taxes. Except as set forth on Schedule 3.07, all federal, state,
and local tax returns, reports and declarations of estimated tax or estimated
tax deposit forms required to be filed by Buyer have been duly filed; Buyer has
paid all taxes which have become due pursuant to such returns or pursuant to any
assessment received by it, and has paid all installments of estimated taxes due;
and all taxes, levies and other assessments which Buyer is required by law to
withhold or to collect have been duly withheld and collected and have been paid
over to the proper governmental authorities. Buyer has no knowledge of any tax
deficiency that has been or might be asserted against Buyer that would
materially and adversely affect the business or operations of Buyer.
3.08 Title to Property; Leases. Buyer has good and defensible title in
fee simple to, or valid and enforceable leasehold estates in, all properties and
assets, which are material to its continued operations, free and clear of all
liens, encumbrances, charges or restrictions except as set forth in the attached
Schedule 3.08 or are not materially significant or important in relation to its
operations and business. All of such leases and subleases under which Buyer is
the lessor or sublessor, lessee or sublessee of properties or assets or under
which Buyer holds properties or assets as lessee or sublessee are in full force
and effect. Buyer is not in default in respect of any of the terms or provisions
of any of such leases or subleases, and no claim has been asserted by anyone
adverse to their respective rights as lessor, sublessor, lessee or sublessee
under any of the leases or subleases mentioned above, or affecting or
questioning their respective rights to continued possession of the leased or
subleased premises or assets under any such lease or sublease; and Buyer either
owns or leases all such properties as are necessary to its operations as now
conducted.
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3.09 Representations True and Correct. This Agreement and the Schedules
and Exhibits attached hereto do not contain any untrue statement of a material
fact concerning Buyer or omits any material fact concerning Buyer which is
necessary in order to make the statements therein not misleading. All of the
representations and warranties contained herein (including all statements
contained in any certificate or other instrument delivered by or on behalf of
the Buyer) shall survive the closing.
3.10 Indemnification. Buyer shall indemnify and hold Company, its
officers and directors, harmless of and in respect of:
(1) Any damage or loss resulting from any loss, liability, damage,
misrepresentation, breach of warranty or non-fulfillment on the part of Buyer
under this agreement or from any misrepresentation or omission from any
certificates or other instrument furnished to the Company pursuant to this
agreement.
(2) All actions, suits, proceedings, demands assessments,
judgments, costs and expenses incident to any of the foregoing including
reasonable attorney's fees and all costs incurred by Company to enforce this
agreement against Buyer.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS
The Shareholders own 100% of the issued and outstanding shares of
stock of Company. The Shares are owned free and clear of any liens or
encumbrances and that the Shareholders are free to transfer the Shares without
the consent of any third party.
The Shareholders, or their authorized representatives, have had an
opportunity to meet with the officers and directors of the Buyer and DUCT and
both have provided the Shareholders with any and all information. The Buyer has
had an opportunity to review all filings made by DUCT with the Securities and
Exchange Commission and is familiar with these filings that are available for
inspection at xxx.xxx.xxx. DUCT has advised the shareholders that it is involved
in litigation with Star Communication Services, Inc. No representation or
warranty has been made regarding the outcome of this litigation.
None of the Shareholders own shares of DUCT.
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ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF BUYER TO CLOSE
The obligations of Buyer under this Agreement are, subject to the
fulfillment of the following conditions at, or prior to, the closing date:
5.01 Representations, Warranties and Covenants. All representations and
warranties of the Company contained in this Agreement and in any statement,
certificate, schedule or other document delivered by the Company pursuant hereto
or in connection herewith shall have been true and accurate in all respects as
of the date when made and as of the Closing Date.
5.02 Covenants, Etc. The Company shall have substantially performed and
complied with each and every covenant, agreement and condition required by this
Agreement to be performed or complied with by them prior to, or at, the Closing
Date.
5.03 Certificate. Company shall have delivered to Buyer a certificate
of the President and Secretary of Company, dated the Closing Date, certifying to
the fulfillment of the conditions set forth in 5.01 and 5.02.
5.04 Proceedings. No action or proceedings shall have been instituted
or threatened against the Company that could materially adversely affect the
business of the Company. No action or proceedings shall have been instituted or
threatened against any of the parties to this Agreement or their directors or
officers before any court or governmental agency to restrain, prohibit or obtain
substantial damages in respect of this Agreement or the consummation of the
transaction contemplated hereby.
5.05 Corporate Documents. Prior to Closing the Company shall furnish to
Buyer copies of the Certificate of Incorporation of Company and each amendment
thereto, if any, which shall be certified by a proper state official; one copy
of the By-Laws and minutes of Company by its secretary or an assistant secretary
as being currently in effect, and a certificate of good standing issued by the
proper state officials of each state in which Company transacts business and is
required to qualify.
5.06 Document & Production. This Agreement is expressly conditioned on
Company providing all identified schedules and exhibits at the time of closing.
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ARTICLE VI
CONDITIONS TO THE OBLIGATIONS OF THE SHAREHOLDERS
The obligations of the Shareholders is subject to the fulfillment of the
following conditions at or prior to the Closing Date:
6.01 Representations, Warranties and Covenants. All representations and
warranties of Buyer contained in this Agreement and in any statement,
certificate, schedule or other document delivered pursuant hereto, or in
connection herewith, shall have been true and accurate in all respects as of the
date when made and as of the Closing Date.
6.02 Covenants, Etc. Buyer shall have substantially performed and
complied with each and every covenant, agreement and condition required by this
Agreement to be performed or complied with by it prior to, or at, the Closing
Date.
6.03 Proceedings. No action or proceedings shall have been instituted
or threatened against Buyer that could materially and adversely affect the
business of Buyer. No actions or proceedings shall have been instituted or
threatened against any of the parties to this Agreement, or their directors or
officers before any court or governmental agency to restrain, prohibit or obtain
substantial damages in respect to this Agreement or the consummation of the
transaction contemplated hereby.
ARTICLE VII
MISCELLANEOUS PROVISIONS
7.01 Abandonment of Agreement. This Agreement may be terminated and the
transaction hereby contemplated abandoned at any time prior to the Closing Date,
whether before or after the approval and adoption hereof by the shareholders of
each Company by (a) the mutual consent of the Board of Directors of Company and
Buyer or (b) the Board of Directors of the Company if any condition to its
obligations provided in this Agreement has not been met at the time such
condition is to be met and has not been waived by it, or (c) by the Board of
Directors of Buyer, if any condition to its obligations provided in this
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Agreement has not been met at the time such condition is to be met and has not
been waived by it.
7.02 Liabilities. In the event this Agreement is terminated pursuant to
Section 7.01, no party hereto shall have any liability to the other and each
party shall bear their own costs incurred.
7.03 Assignments. This Agreement may not be assigned except with the
written consent of the non-assigning party. Notwithstanding the foregoing, the
rights of the Shareholders to receive the Shares shall be freely assignable.
7.04 Survival of Representations and Warranties. Company and Buyer
agree all representations and warranties contained herein or made hereunder
shall survive the Closing, except that any breach disclosed in writing to either
party prior to Closing is waived by such party if it elects to close
notwithstanding such breach.
7.05 Notices. All notices, demands and other communications that may be
or are required to be given pursuant to this Agreement shall be given or made
when personally delivered or when deposited in the United States Mail, first
class, postage pre-paid, addressed as follows:
If to Company to: Mr. Xxxxxx Xxxxxxxx
XX Xxxxxx, Inc.
Xxxxx 0 Xxx 000
Xxxxx Xxxx, XX 00000
With a copy to: Xx. Xxxx Xxxxx
Xxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
XX Xxx 0000
Xxxxxxx Xxxxxxx, XX 00000-0000
or to such other address as Company may, from time to time, designate by Notice
to the Buyer
If to Buyer to: Xxxxxxx Xxxx
DUCT 2, Inc.
000 Xxxxxxxxx Xxxxx, Xxxxx X
Xxxxxxxxxx, XX 00000
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With a copy to: Mr. Xxxxxxx Xxxxx, Esq.
000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, XX 00000
or to such other addresses as Buyer may, from time to time, designate by notice
to Company.
7.06 Closing. The closing date for the contemplated transaction shall
be on August 15, 2001 or such other mutually agreeable date.
7.07 Entire Agreement. This Agreement constitutes the entire agreement
between the parties, and supersedes and cancels any and all prior agreements
between the parties relating to its subject matter. The representations,
warranties, covenants and conditions of the obligations of the parties hereto
may not be orally amended, modified or altered, but may be amended, modified or
altered in a writing signed by each of the parties, whether before or after the
meeting of shareholders of Company contemplated herein.
7.08 Captions. The captions of Articles and Sections of Articles hereof
are for convenience only and shall not control or affect the meaning or
construction of any of the provisions of this Agreement.
7.09 Governing Law. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the state of Ohio and jurisdiction for
any dispute shall be in Ohio.
7.10 Waivers. Any failure of either party hereto to comply with any of
its obligations or agreements, or to fulfill conditions herein contained may be
waived in writing by the other party. No waiver by any party of any condition or
the breach of any provision, term, covenant, representation or warranty
contained in this Agreement, whether by conduct or otherwise, shall be deemed to
be or construed as a further or continuing waiver of any such condition or of
the breach of any other provision, term, covenant, representation, or warranty
of this Agreement.
7.11 Counterparts. This Agreement may be executed in several
counterparts and all so executed shall constitute one agreement, binding upon
all of the parties hereto, notwithstanding that not all of the parties are
signatory to the original or the same counterpart.
17 DUCT _____ BJB _____
7.12 Successors. The terms covenants and conditions of the Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, legal representatives, successors and assigns.
7.13 Binding Agreement. This Agreement represents the entire agreement
among the parties hereto with respect to the matters described herein and is
binding upon and shall inure to the benefit of the parties hereto and their
legal representatives. This Agreement may not be assigned and, except as stated
herein, may not be altered or amended except in writing executed by the party to
be charged.
This Agreement is entered into the date first entered above.
DUCT 2, Inc. WITNESS:
---------------------------- ----------------------------
By: Xxxxxxx X. Xxxx, CEO
DUCT Utility Construction & Technologies, Inc.
---------------------------- ----------------------------
By: Xxxxxxx X. Xxxx, CEO
XX Xxxxxx, Inc.
---------------------------- ----------------------------
By: Xxxxxx XXxxxxxx, President
THE SHAREHOLDERS
---------------------------- ----------------------------
Xxxxxxx Xxxxxxxx
---------------------------- ----------------------------
Xxxxxx Xxxxxxxx
18 DUCT _____ BJB _____
EXHIBIT 1.01
SHAREHOLDERS
PRE EXCHANGE OWNERSHIP
SHAREHOLDER XX XXXXXX SHARES DUCT SHARES
-----------------------------------------------------------------
Xxxx Xxxxxxxx 250 0
Xxx Xxxxxxxx 750 0
POST EXCHANGE OWNERSHIP
SHAREHOLDER XX XXXXXX SHARES DUCT SHARES
-----------------------------------------------------------------
Xxxx Xxxxxxxx 0 48,750
Xxx Xxxxxxxx 0 146,250
EXHIBIT 1.01(b)
CONSENT TO DEFER NOTE REPAYMENT
The undersigned, note holders of XX Xxxxxx, Inc., hereby consent to defer the
repayment of notes outstanding from August 15, 2001, to 9 months following the
date of closing of a stock exchange agreement between XX Xxxxxx, Inc. and DUCT
2, Inc. Upon closing, said notes shall accrue interest at 8% per annum.
--------------------------
Xxxxxx Xxxxxxxx
--------------------------
Xxxxx Xxxx
EXHIBIT 2.02
XX XXXXXX FINANCIAL STATEMENTS
ATTACHED
EXHIBIT 2.03
LITIGATION
NONE
19 DUCT _____ BJB _____
EXHIBIT 2.03(b)
LIENS
NONE
SCHEDULE 2.04
COMPLIANCE WITH LAWS
NONE
SCHEDULE 2.06
COMMON STOCK ISSUANCE
NONE
SCHEDULE 2.10
EXCEPTIONS TO REQUIRED TAX FILINGS
NONE
EXHIBIT 2.11
LISTING OF COMPANY ASSETS
ATTACHED
SCHEDULE 2.13
BANK ACCOUNTS
INSTITUTION ACCOUNT
------------------------------------------
The First Bank of Xxxxxxx 59717
XX Xxx 0
Xxxxxxx, XX 00000
000-000-0000
EXHIBIT 2.14
EMPLOYEE CONTRACTS & COMMITMENTS
NONE
EXHIBIT 2.14(b)
CURRENT OFFICERS & EMPLOYEES & COMPENSATION
XXX XXXXXXXX, President - $52,000 plus a portion of year-end profits
XXX XXXXXXXX, Vice President - $0.00
XXXX XXXXXXXX, Vice President - 52,000 plus a portion of year-end profits
20 DUCT _____ BJB _____
XXXXXXXX XXXXXXXX, Secretary & Treasurer - $4,800
XXXXXX XXXXXX, Vice President - $52,000 plus a portion of year-end profits
XXXXX XXXXXX, Assistant Treasurer - $0.00
XXXX XXXXX, Fiber Manager, $36,000
EXHIBIT 2.17
TRADEMARKS & TRADENAMES
NONE
EXHIBIT 2.18
RESIGNATIONS
I, Xxx Xxxxxxxx, an officer and director of XX Xxxxxx, Inc., hereby resign as a
director of the corporation effective at __:__ o'clock, _:m., July __, 2001.
---------------------------------
Xxx Xxxxxxxx
I, Xxx Xxxxxxxx, an officer and director of XX Xxxxxx, Inc., hereby resign as a
director of the corporation effective at __:__ o'clock, _:m., July __, 2001.
---------------------------------
Xxx Xxxxxxxx
I, Xxxx Xxxxxxxx, an officer and director of XX Xxxxxx, Inc., hereby resign as a
director of the corporation effective at __:__ o'clock, _:m., July __, 2001.
---------------------------------
Xxxx Xxxxxxxx
I, Xxxxxxxx Xxxxxxxx, an officer and director of XX Xxxxxx, Inc., hereby resign
as a director of the corporation effective at __:__ o'clock, _:m., July __,
2001.
---------------------------------
Xxxxxxxx Xxxxxxxx
I, Xxxxx Xxxxxx, a director of XX Xxxxxx, Inc., hereby resign as a director of
the corporation effective at __:__ o'clock, _:m., July __, 2001.
---------------------------------
Xxxxx Xxxxxx
I, Xxxxxx Xxxxxx, a director of XX Xxxxxx, Inc., hereby resign as a director of
the corporation effective at __:__ o'clock, _:m., July __, 2001.
---------------------------------
Xxxxxx Xxxxxx
21 DUCT _____ BJB _____
