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EXHIBIT 6.3
STOCK EXCHANGE AGREEMENT
STOCK EXCHANGE AGREEMENT ("Agreement") entered into as of June 23, 2000,
by and among Interglobal Waste Management, Inc., a California corporation. with
its principal office at 000 Xxxxx Xxxxx, Xxxxxxxxx, XX 00000 ("Buyer"), ROYCE
Instrument Corporation, a Louisiana corporation (the "Company" or "Royce"), with
its principal office at 00000 Xxxxxxxx Xxxx, Xxx Xxxxxxx, XX 00000, and Xxxxx X.
Xxxxxx, Xxxxx X. Xxxxxxx and Xxxx X. Xxxxxxxxx ("Stockholders").
RECITALS
1. Stockholders have made oral representations to Buyer that they are
the owners, free and clear of all adverse claims, of all of the outstanding
shares of capital stock (the "Shares") of ROYCE.
2. Stockholders are willing to transfer to Buyer all of the shares upon
the terms and conditions and for the consideration set forth below.
3. Buyer is willing, subject to those terms and conditions and for that
consideration, to acquire all of the Shares.
AGREEMENT
The parties agree:
1. Transfer of the Shares.
Subject to the terms and conditions set forth and upon the
representations and warranties made in this Agreement, at the date of closing
(as that term is defined in Section 6):
(a) Stockholders will transfer to Buyer all of the Shares, the exact
number of Shares to be transferred by each Stockholder to be as follows:
STOCKHOLDER NO. OF SHARES
----------- -------------
Xxxxx X. Xxxxxx 329,499
Xxxxx X. Xxxxxxx 1,200
Xxxx X. Xxxxxxxxx 1,300
Total 331,999
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(b) Buyer will issue and deliver to Stockholders share certificates for
a total number of shares of Common Stock of Buyer (the "Buyer Stock"), the exact
number of shares of Buyer stock to be issued to each Stockholder to be
determined as follows:
(i) The total consideration to be paid by Buyer to Stockholders
shall be the sum of $406,540.07 (or $1.224522 per Share) in shares of Buyer
Stock;
(ii) Each share of Buyer Stock shall be valued at $1.50;
(iii) In order to avoid the issuance of fractional shares of
Buyer Stock, the number of Buyer Shares to be issued and delivered to the
Stockholders shall be the number obtained by dividing-the total dollar value
attributable hereunder to all of the Shares owned by each Stockholder, by the
per-share value of Buyer Shares ($1.50), rounded up to the next whole number;
(iii) Accordingly, Stockholders will receive as consideration for
the transactions contemplated herein, Buyer Stock in the following amounts:
SHARES OF
STOCKHOLDER BUYER STOCK
----------- -----------
Xxxxx X. Xxxxxx 268,993
Xxxxx X. Xxxxxxx 980
Xxxx X. Xxxxxxxxx 1,062
Total 331,761
It is the intention of Stockholders and Buyer that the consideration
paid in Buyer Stock shall constitute, insofar and to the extent of such
consideration, a tax free exchange of stock under Internal Revenue Code Section
368(a)(1)(B).
2. Representations and Warranties of Stockholders.
Stockholders represent and warrant to, and agree with Buyer that, except
as set forth in Exhibit 2:
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(a) The Company and each corporation named in Exhibit 1 (corporations
whose capital stock is wholly or majority owned by Royce and which are sometimes
collectively referred to in this Agreement as the Company) is and will be at the
date of closing a corporation duly incorporated and validly existing under the
laws of the state of its incorporation; is and will be at the date of closing in
good standing under the laws of the state of its incorporation and, to the best
of Stockholders' knowledge, of any other state or jurisdiction where it does
intrastate business; has and will have at the date of closing all requisite
corporate power and authority to own its properties and carry on its business as
now conducted; and, to the best of Stockholders' knowledge, has and will have at
the date of closing obtained all licenses, permits, or other authorizations, and
taken all actions, required by applicable law or governmental regulations in
connection with its business as now conducted.
(b) Royce has an authorized capital stock consisting solely of 1,000,000
shares of common stock, with $.10 par value, of which 331,999 shares and no more
are presently issued and outstanding (there being also 350,801 shares which have
been issued but are held in the Company's treasury and are not outstanding).
(c) The Company does not own, directly or indirectly, a majority or
controlling interest in any corporation, business trust, joint stock company, or
other business organization or association, except the corporations named in
Exhibit 1 to this Agreement, each of which has an authorized capital stock,
outstanding shares of stock, and [a] stockholder[s] as set forth in Exhibit 1.
There are no outstanding rights, warrants, options, subscriptions, agreements,
or commitments giving anyone any right to require the Company to issue, sell, or
transfer any capital stock or other securities. The Company is not a general
partner of any partnership or a party to any joint venture.
(d) The shares of stock referred to in Exhibit 1 to this Agreement as
owned by the Company or a subsidiary of the Company are owned free and clear of
all liens, encumbrances, charges, and assessments.
(e) Financial statements of the Company consisting of unaudited balance
sheets as of December 31, 1999; unaudited statements of operations, changes in
stockholders' equity, and changes in financial position or cash flow for the
fiscal years ended on such dates, respectively; an unaudited balance sheet as of
December 31, 1999 (the "Balance Sheet"); and unaudited statements of
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operations, changes in stockholders' equity, and changes in financial position
or cash flow for the twelve-month period ended December 31,1999 (all financial
statements listed above are referred to in this Agreement collectively as the
"Financial Statements") have been delivered to Buyer. The Financial Statements
fully and fairly set forth the financial condition of the Company as of the
dates and the results of its operations for the periods indicated in accordance
with generally accepted accounting principles consistently applied; and the
Company did not have at December 31, 1999 and shall not have at closing:
(i) Any obligations, commitments, or liabilities,
contingent or otherwise, whether for taxes or otherwise, which
are not shown or provided for in the Financial Statements, except
obligations to perform, after that date, sales contracts, supply
contracts, purchase orders, and other commitments in each case in
amounts incurred only in the ordinary course of business;
(ii) Any continuing contract for the future purchase of
materials, supplies; or equipment (except for any such contract
which can be terminated without payment of any amount as a
penalty or bonus) or any contract or commitment for capital
expenditures in excess of $10,000 in the aggregate or any
contract continuing over a period of more than one year from its
date;
(iii) Any pension, retirement, deferred compensation,
profit sharing, bonus, retainer, consulting, welfare, or
incentive compensation plan or arrangement, or any contract, or
any fringe or other benefits or arrangements, of, with, or for
any officer, director, employee, or any other person which cannot
be terminated within a period of 30 days and without payment of
any amount as a penalty, bonus, premium, or other compensation
for such a termination;
(iv) Any written or oral contract with or commitment or
liabilities to, any labor organization or association of
employees (and no negotiation with any such organization or
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association and no attempt, plan, or threat to organize the
employees of the Company is pending or, to the best of
Stockholders' knowledge, after reasonable investigation,
threatened or contemplated);
(v) Any litigation, legal action, arbitration, proceeding,
demand, claim, or investigation pending, or to the best of
Stockholders' present knowledge (after reasonable investigation),
threatened or planned against the Company which might adversely
and materially affect its business or property or this Agreement;
(vi) The Company's non-current and uncollectible notes or
accounts receivable not exceeding $30,000.00, in the aggregate;
(vii) Obsolete inventory in amounts exceeding $30,000.00
in the aggregate;
(viii) Any shortages existing in (A) any inventory or raw
materials owned by customers or others and stored upon the
premises of the Company for use in future orders of such
customers or for other purposes except for shortages, if any, not
exceeding the normal allowance for scrap, production losses, and
materials consumed in process, or (B) any other items of personal
property owned by another for which the Company is accountable to
another, other than any such items with a collective value of
less than $2,500.
(f) To the best of Stockholders' knowledge, the Balance Sheet contains
adequate provision for all federal income, accumulated earnings, or other
federal taxes and all state or local income, franchise, real property, personal
property, sales, withholding, and all other taxes imposed on the Company, or its
property or rights or payable by it or a lien on any of its property, including
interest and penalties, if any, in respect to such taxes, for the period ended
on that date and all fiscal periods prior to that date. The Company has timely
filed or will file all required federal, state, and local tax returns
(collectively, the "Tax Returns") and has paid all federal, state, and local
taxes (collectively, the "Taxes") reflected as due for all periods ending on or
before December 31, 1999. The Company has delivered to Buyer copies of all Tax
Returns filed with respect to tax years beginning after December 31, 1996. All
required Tax Returns, including
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amendments to date, have been prepared in good faith without willful
misrepresentation and are complete and accurate in all material respects. The
Company represents that it has paid all taxes reflected on the returns. The
Internal Revenue Service has examined the federal tax returns of the Company for
all past periods for the year ended through December 1997, and only years
subsequent to the year ended December 31, 1997 remain open for assessment of
additional federal taxes. State tax authorities have not examined the state tax
returns of the Company. No deficiency in payment of any taxes for any period has
been asserted by any taxing body and remains unsettled at the date of this
Agreement and all reports or returns required to be filed by the Company with
any federal, state, or local governmental body or authority have been properly
filed.
(g) Since the date of the Balance Sheet there has been no material
adverse change known to Stockholders (after reasonable investigation) to be
probable, in the business, capitalization, financial condition, or properties of
the Company and the only material changes in the business, capitalization,
financial condition, or properties of the Company since that date are those
arising from the normal and regular conduct of its business, and no material
loss, damage, or destruction of its properties or business (whether or not
covered by insurance) has occurred since that date or is threatened or known to
Stockholders. The term "business," as used here and elsewhere in this Agreement
to refer to the business of the Company shall mean any one or more significant
aspects of its business, including, by way of example and not limitation, costs
(of labor or other services, materials, or sales), backlog, manufacturing
processes, products and rights to manufacture and sell products, sales volume,
sales mix, sales pricings, profit margins, customers, or continuing ability to
effect sales as in the past.
(h) Except as noted on Exhibit 2(h), the Company has not since the date
of the Balance Sheet, and will not on or prior to the date of closing, declare
or pay or make any payment of a dividend or other distribution to its
shareholders or purchase, redeem, or otherwise acquire or dispose of any share
of its stock; the Company will not, except in the ordinary course of business,
pay or discharge any outstanding indebtedness.
(i) To the best of the Company's knowledge, the Company is not in
material default under any contract to which it is a party or by which it is
bound, nor has any event occurred which, after the giving of notice or the
passage of time or both, would constitute a default under any such contract; and
the Company is not
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a party to or bound by any mortgage, lien, lease, agreement, instrument, order,
or judgment or decree which would prohibit the execution of this Agreement or
prohibit or make unduly burdensome the consummation of any of the transactions
provided for in this Agreement.
(j) None of the properties and assets of Seller (including the
properties and assets reflected in the Balance Sheet but except any property or
assets since disposed of for value in the ordinary course of business) is
subject to a contract of sale (except inventory held for sale in the ordinary
course of business); substantially all inventory now on hand is in good
condition and is presently usable or salable in the ordinary course of business
of the respective corporations; substantially all fixed assets, plant, and
equipment of the Company reflected in the Balance Sheet are in good operating
condition and repair and their use in their business is in compliance with all
applicable laws or governmental regulations, including (without limitation)
zoning, use, or air pollution laws or regulations.
(k) The Company or its respective indicated subsidiary owns the patents,
patent applications, inventions, disclosures, copyrights, trademarks, trade
names, and licenses described in Exhibit 3 to this Agreement. Except to the
extent, if any, set forth in Exhibit 3, those patents, patent applications,
inventions, disclosures, copyrights, trademarks, trade names, and licenses are
valid and in good standing, are subject to no liens or charges (other than, in
the case of licenses or rights acquired from others, payments of royalties or
license fees as set forth or referred to in Exhibit 3) and to the best of
Company's knowledge are adequate and sufficient to permit the Company, to
conduct its businesses as presently being conducted. To the best of Company's
knowledge and without having performed any particular investigation into the
uniqueness of its own trade secrets, substantially all trade secrets owned or
used by the Company are owned by it free of any adverse claims, rights, or
encumbrances as to the Company's exclusive rights to them. The Company will take
such steps as requested by Buyer at or after the closing to insure disclosure of
such trade secrets to and only to persons designated by Buyer.
(l) The officers and directors of the Company are as set forth in
Exhibit 4 to this Agreement.
Exhibits 2 and 4 together also show: the names of all persons whose
compensation from the Company for the fiscal year ending December 31, 1999, (at
their present or presently anticipated rates, including bonuses) will equal or
exceed $60,000, together with a statement of the full amount paid or payable to
each such person and the basis of payment (e.g., salary, bonus, stock
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appreciation rights, commissions, etc.); the name of each bank, trust company,
or savings institution in which the Company has an account or safe deposit box
and the names and identification of all persons authorized to draw on or to have
access to any such account or safety deposit box; the names of all persons, if
any, holding powers of attorney from the Company and a summary statement of the
terms of each; and a list of all insurance policies owned by the Company, with a
brief statement of the coverage of each.
(m) Exhibit 5 to this Agreement contains a list of all real property
owned by the Company or in which the Company has a leasehold or other interest.
Exhibit 5 also contains a substantially accurate legal description of all real
property.
(n) The Company has not, with regard to any property, held, acquired, or
to be acquired, at any time filed a consent to the application of Section
341(f)(2) of the Internal Revenue Code, as amended.
(o) To the best of Company's knowledge, no representation or warranty by
Stockholders in this Section 2 or in any other section of this Agreement, or in
any certificate or other document furnished or to be furnished by Stockholders
pursuant to this Agreement, contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary to make
the statements that are made not misleading or necessary in order to provide
Buyer with complete and accurate information as to the Company.
(q) The Shares referred to in subparagraph (a) of Section 1 are owned by
Stockholders free and clear of all liens, encumbrances, charges, and
assessments, and such shares are subject to no restrictions with respect to
transferability to Buyer in accordance with the terms of this Agreement.
(r) Upon transfer of the Shares to Buyer by Stockholders, Buyer will, as
a result, receive good and marketable title, free and clear of all liens,
encumbrances, claims, charges, assessments, and restrictions, to all of the
Shares.
(s) The Company has not incurred any accumulated funding deficiency
within the meaning of the Employee Retirement Income Security Act of 1974
["ERISA"] or any liability to the Pension Benefit Guaranty Corporation
established under ERISA in connection with any employee benefit plan established
or maintained by the Company.
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3. Additional Representations, Warranties, and Agreements of
Stockholders.
(a) Each Stockholder agrees to use his best efforts to cause the
execution of an agreement, and the closing of the transaction contemplated
thereby, whereby Buyer shall purchase all of the issued and outstanding stock of
Polycast, at a valuation to be agreed upon between the Stockholders and Buyer.
Each Stockholder agrees to sell his individual shares of stock of Polycast to
Buyer at said valuation.
(b) Upon the closing, each member of the Board of Directors of the
Company shall sign a consent to the election of Xxxxxx X. Xxxxxxxx to the Board
of Directors of the Company. Each member of the Board of Directors other than
Xxx Xxxxxx and ____________ shall thereupon tender his resignation from the
Board of Directors.
4. Representations, Warranties and Agreements of Buyer. Buyer represents
and warrants to, and agrees with the Stockholders that:
(a) Buyer is a California corporation which has been validly
incorporated and is validly existing and in good standing under the laws of the
State of California with an authorized capital stock of 100 million shares of
common stock, without par value, of which 29,961,953 and no more are presently
issued and outstanding (there being also zero shares which have been issued but
are held in the Company's treasury and are not outstanding;
(b) Upon the execution and delivery of this Agreement, Stockholders
shall own the Buyer Stock, in the amounts set forth hereinabove, free and clear
of all liens, encumbrances, charges, and assessments;
(c) Buyer shall provide to Stockholders true and correct copies of
Buyer's Articles of Incorporation, By-Laws, any and all Shareholder Agreements
or other documents evidencing stock transfer restrictions in effect with respect
to the Buyer Stock, as well as other corporate governance documents then in
effect with respect to Buyer on the date of execution of this Agreement;
(d) The financial statements of the Buyer provided to Seller in
connection herewith fully and fairly set forth the financial condition of the
Company as of the dates and the results of its operations for the periods
indicated in accordance with generally accepted accounting principles
consistently applied;
(e) There are no material adverse changes known to Buyer (after
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reasonable investigation) to be probable, in the business, capitalization,
financial condition, or properties of the Buyer.
(f) The execution, delivery, and performance of this Agreement by Buyer
have been duly authorized by all requisite corporate action;
(c) Buyer shall, within thirty (30) days after the closing, provide up
to $500,000 of working capital to the Company,
(d) The parties agree that it is the intention of Company and Buyer to
retain existing bank lines of credit and other financial relationships; and
Buyer shall indemnify all individuals who have personally guaranteed loans, or
other such obligations;
(e) During the period of five years from the date of closing, Buyer will
not require Company to relocate to any site outside the State of Louisiana.
6. The Closing.
(a) The transfer of the Company Stock and the payment of the
consideration for that stock by Buyer shall be effected as provided in this
Agreement on the date of closing specified below (the "closing"). Time shall be
of the essence and delivery of certificates for all of the Shares at the time
and place provided in this Agreement is a condition of Buyer's obligation, and
delivery of the certificates for all of the shares of Buyer Stock to be issued
under this Agreement at the closing at such time and place is a condition of
Stockholders' obligations.
(b) At the closing Stockholders shall deliver or cause to be delivered
to Buyer certificates evidencing the shares. The certificates evidencing the
Shares so delivered shall be properly endorsed for transfer or accompanied by
duly executed stock powers, in either case executed in blank or in favor of
Buyer as Buyer may have directed prior to the closing. Buyer shall deliver
certificates to Stockholders evidencing the shares of Buyer Stock to be issued
under this Agreement duly registered in the name of the respective Stockholders.
Stockholders agree to pay any taxes payable in connection with the transfer by
Stockholders to Buyer of the Shares, and all costs and expenses of the
performance of and compliance with all agreements and conditions contained in
this Agreement to be performed or complied with by Stockholders.
(c) The closing shall take place at a place and on a date mutually
agreed by Buyer and the Stockholders not later than June 23, 2000. The place of
the closing may be changed by mutual agreement between Buyer and Stockholders.
The date and hour of closing is sometimes referred in this Agreement to as the
"date of closing" or the "closing."
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7. Conditions of Buyer's Obligations.
(a) Buyer's obligations under this Agreement are subject to the accuracy
in all material respects at and as if made at the date of closing of the
representations and warranties made by the Company in this Agreement and
fulfillment to the date of closing of its agreements contained in this Agreement
and to the following additional conditions:
(b) Buyer shall have received from Xxxxxxx X. Xxxxxxxx, counsel for
Stockholders in rendering the opinion, an opinion in form and substance
satisfactory to Buyer dated the date of closing to the effect that (i) the
Company has been duly incorporated and is validly existing, in good standing,
under the laws of its state of incorporation as of such date, has all requisite
corporate power and authority to own its properties and carry on its business as
conducted on the date of the closing; (ii) the Company has an authorized and
outstanding capital stock as set forth in subparagraph (b) of Section 2 of this
Agreement; (iii) each Stockholder is the registered owner of the respective
Shares to be sold by that Stockholder under this Agreement and when certificates
representing the Shares shall have been duly delivered to Buyer by Stockholders,
as provided in this Agreement, that delivery will transfer to Buyer good title
to the Shares, and these shares constitute all the outstanding capital stock of
the Company; (iv) this Agreement has been duly executed by Stockholders and is
valid and validly executed as to Stockholders; the execution and consummation of
the Agreement will not violate or result in a breach of, the Articles of
Incorporation or Bylaws of the Company, as amended; (v) except as may be set
forth in Exhibit 2 to this Agreement counsel for Stockholders does not know
(after reasonable investigation) of any litigation, proceeding, or governmental
investigation or labor dispute pending or threatened against or relating to the
Company or its properties or businesses or the transactions contemplated by this
Agreement. Counsel for Stockholders may rely upon the representations of the
officers of the Company as matters of fact, and may assume as fact that any
minutes, resolutions, or other agreements authorized and executed by the Company
are proper, duly authorized and effective against third parties.
(c) There shall have been no material adverse change since the date of
the Balance Sheet in the financial condition or affairs of the Company and it
shall not have suffered any loss (whether or not insured) by reason of physical
damage caused by fire, earthquake, accident, or other calamity which
substantially affects
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the value of its properties or business, and Buyer shall have received
certificates of the President and the Secretary of the Company dated the date of
closing to that effect.
8. Conditions of Stockholders' Obligations.
The Company will receive an opinion of Xxxxxxx & Xxxxxxx, counsel for
Buyer in this matter, dated the date of closing, to the effect that (i) Buyer
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of California; (ii) the execution,
delivery, and performance of this Agreement by Buyer has been duly authorized by
all requisite corporate action on its part; and (iii) Buyer has authorized stock
consisting of 100 million shares of Common Stock, without par value.
9. Satisfaction of Conditions Precedent.
Each party agrees to use its best efforts to cause the conditions to its
obligations set forth above to be satisfied at or prior to the closing.
10. Additional Agreements of Stockholders.
Each Stockholder agrees to refrain anywhere in the world from carrying
on directly or indirectly (either as a proprietor, partner, stockholder,
officer, director, agent, employee, consultant, trustee, affiliate, or
otherwise) a business of the type conducted by the Company on the date of
closing or the business of manufacturing or selling products that are or would
be competitive with products presently manufactured or sold or offered for sale
by the Company, including the business of manufacturing and distributing
monitoring and control instrumentation; except as officers, employees, or
representatives of Buyer or a subsidiary or affiliate of Buyer, for a period of
two (2) years from the date such Stockholder ceases to be employed by Buyer or a
subsidiary or affiliate thereof. Each Stockholder agrees that the business of
Buyer and the Company is worldwide in scope and the foregoing limitation is
reasonable as to scope in light of the business of Buyer and the Company.
Notwithstanding the foregoing, it shall not be a breach of the provisions of
this paragraph for any Stockholder to own, as a passive investment, not more
than 5 percent of the outstanding stock of a publicly held company engaged in
any of the above activities.
Each Stockholder covenants and represents that such Stockholder has no
interest in, or claim to any of the inventions, formulae, methods, processes, or
technical information used in the business or operations or in the current
possession of the Company, and all knowledge or information of a confidential
nature acquired at or before the date of this Agreement with respect to the
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business and operations of the Company or any of its predecessors and all
knowledge or information of a confidential nature acquired after the date of
this Agreement about the business and operations of the Company or its
successors, will be held in confidence by the Stockholder, and will not be
disclosed or made public or made use of by or through Stockholder, directly or
indirectly.
11. Further Assurances. Notwithstanding any provision herein to the
contrary, the parties hereto expressly acknowledge that all documents required
by the parties to be executed and/or delivered pursuant to this Agreement may
not have been executed and delivered upon execution of this Agreement and
closing of the transaction contemplated herein. The failure of delivery or
execution of documents shall not, ipso facto, be deemed to be a default or
breach of this Agreement without reasonable prior notice to the aggrieving party
providing a reasonable opportunity for such party to cure the alleged breach or
default. Each party hereto agrees be cooperative and shall take such further
action and execute and deliver such further documents as may be reasonably
requested by the another party hereto in order to effectuate or facilitate the
purpose and intents of this Agreement.
12. Fees or Commissions of Brokers.
Each Stockholder represents to Buyer that such Stockholder has not dealt
with any broker or finder in this transaction and agrees to indemnify Buyer
against any loss, cost, or expense, including attorneys' fees, as a result of
any claim for a fee or commission asserted by any broker or finder claiming
against or through Stockholder with respect to this Agreement or its
consummation. Buyer represents to each Stockholder that Buyer has not dealt with
any broker or finder in this transaction and agrees to indemnify each
Stockholder against any loss, cost, or expense, including attorneys' fees, as a
result of any claim for a fee or commission asserted by any broker or finder
claiming against or through Buyer with respect to this Agreement or its
consummation.
13. Assignment of Patents, etc.
Each Stockholder agrees to assign to Buyer or its designee all patents,
patent applications, inventions, disclosures, written technical data,
copyrights, formulae, manufacturing methods, trade secrets and trademarks and
trade names, if any, owned by that Stockholder or under which Stockholder claims
any rights and relating to any products of or processes used by the Company or
relating to its business. If and to the extent any corporation, firm, or person
controlled by or affiliated with that Stockholder owns or has rights in any of
the foregoing, that Stockholder agrees to cause such corporations or persons to
assign all such rights to Buyer or the Company without additional consideration
being paid for those rights by Buyer or Company.
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14. Indemnification by Stockholders.
Stockholders jointly and severally agree to indemnify and hold Buyer and
the Company harmless against, and will reimburse Buyer (or the Company if Buyer
so requests) on demand for any payment (and any expenses, including attorneys'
fees and costs of investigation, incurred in defending against such payment or
any claim for such payment) made by the Company at any time after the date of
the Balance Sheet or by Buyer at any time after the date of closing, in excess
of $30,000.00 in the aggregate and in respect of:
(a) Any and all liabilities of the Company of any nature,
whether accrued, absolute, contingent, or otherwise existing at
the date of the Financial Statements, to the extent not reflected
or reserved against in the Financial Statements, or disclosed on
Exhibits to this Agreement.
(b) Any and all liabilities of or claims against the
Company arising out of (i) the conduct of the business of the
Company between the date of the Financial Statements and the date
of closing, otherwise than in the ordinary course of business of
the Company or as disclosed in any Exhibit to this Agreement; and
(ii) any presently existing obligation, commitment, or liability
of the character described in clause (ii) of Section 2(e) of this
agreement and not listed in one or more exhibits to this
Agreement.
(c) Any and all damage or deficiency resulting from any
misrepresentations, breach of warranty, or nonfulfillment of any
agreement on the part of a Stockholder under this Agreement, or
from any misrepresentation in, or omission from, any certificate
or other instrument furnished or to be furnished to Buyer
pursuant to the Agreement.
15. Notices.
Any notices under this Agreement shall be deemed sufficiently given by
one party to another if in writing and if and when delivered or tendered either
in person or by depositing it in the United States mail in a sealed envelope
registered or certified, with postage and postal charges prepaid, addressed as
follows:
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If to Buyer:
Interglobal Waste Management, Inc.
000 Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
If to Stockholders:
_______________________________________________________________________
_______________________________________________________________________
Attention:_____________________________________________________________
If to Royce:
00000 Xxxxxxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxx Xxxxxx
or to such other address as the party addressed shall have previously
designated by notice to the serving party, given in accordance with this
paragraph; provided, that a notice not given as above shall, if it is in
writing, be deemed given if and when actually received by the party to whom it
is required or permitted to be given.
16. Miscellaneous.
(a) This Agreement shall be binding upon and shall inure to the benefit
of Stockholders and their respective heirs, executors, administrators, and
assigns and of the Buyer and its successors and assigns.
(b) This Agreement constitutes the entire agreement among the parties
pertaining to the subject matter of this Agreement and supersedes all prior
agreements and understandings of the parties in connection with that subject
matter.
(c) This Agreement shall be governed by and construed in accordance with
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the laws of the State of California,
(d) All of the terms, conditions, warranties, and representations
contained in this Agreement shall survive delivery by Buyer of the
consideration to be given by it under this Agreement and delivery by
Stockholders of the consideration to be given by them under the Agreement, shall
survive the date of closing, and shall survive and continue notwithstanding any
investigations by or on behalf of Buyer at any time.
(e) This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same instrument.
(f) Consent to Jurisdiction. Each of the Stockholders and the Buyer, by
its or his execution hereof, (i) hereby irrevocably submits to the exclusive
jurisdiction of the state and Federal courts located within Los Angeles County,
State of California for the purpose of any claim or action arising out of or
based upon this Agreement or relating to the subject matter hereof, (ii) hereby
waives, to the extent not prohibited by applicable law, and agrees not to assert
by way of motion, as a defense or otherwise, in any such claim or action, any
claim that is not subject personally to the jurisdiction of the above-named
courts, that its or his property is exempt or immune from attachment or
execution, that any such proceeding brought in the above-named court is
improper, or that this Agreement or the subject matter hereof may not be
enforced in or by such court, and (iii) hereby agrees not to commence any claim
or action arising out of or based upon this Agreement or relating to the subject
matter hereof other than before the above-named courts nor to make any motion or
take any other action seeking or intending to cause the transfer or removal of
any such claim or action to any court other than the above-named courts whether
on the grounds of inconvenient forum or otherwise. Each of the Stockholders and
the Buyer hereby consents to service of process in any such proceeding in any
manner permitted by California law, and agrees that service of process by
registered or certified mail, return receipt requested, at its address specified
pursuant to Paragraph 15 hereof is reasonably calculated to give actual notice.
(g) WAIVER OF RIGHT TO JURY TRIAL. EACH OF THE STOCKHOLDERS AND THE
BUYER, BY ITS OR HIS EXECUTION HEREOF, WAIVES ITS OR HIS RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION AND THE RELATIONSHIP THAT
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IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL
ENCOMPASSING OF ANY AND ALL DISPUTES THAT MY BE FILED IN ANY COURT AND THAT
RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION,
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW
AND STATUTORY CLAIMS. THE STOCKHOLDERS AND THE BUYER ACKNOWLEDGE THAT THIS
WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH
HAS ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH
WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. THE
STOCKHOLDERS AND THE BUYER FURTHER WARRANT AND REPRESENT THAT EACH HAS REVIEWED
THIS WAIVER WITH ITS OR HIS, AS THE CASE MAY BE, LEGAL COUNSEL, AND THAT EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS OR HIS, AS THE CASE MAY BE, JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS AGREEMENT OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THE TRANSACTION CONTEMPLATED HEREBY. IN THE EVENT OF LITIGATION,
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
(h) Arbitration of Disputes. Any dispute between the parties hereto,
whether arising out of contract, tort or otherwise, or law, equity or otherwise,
shall be submitted to binding arbitration before the American Arbitration
Association in Los Angeles, California under the rules relating to commercial
arbitrations. Each party to any such dispute shall be entitled to serve one set
of pre-arbitration requests for production of documents, containing not more
than ten categories of documents to be produced, which shall be described with
particularity therein, and shall be entitled to notice and take no more than two
pre-arbitration depositions. Any disputes relating to such pre-arbitration
discovery shall be submitted to the arbitrator.
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By /s/ XXXXXX X. XXXXXXXX
--------------------------
Xxxxxx X. Xxxxxxxx
STOCKHOLDERS ROYCE INSTRUMENT CORPORATION
/s/ XXXXX X. XXXXXX
----------------------------- By /s/ XXXXX X. XXXXXX
Xxxxx X. Xxxxxx ---------------------------------
Xxxxx X. Xxxxxx
/s/ XXXXX X. XXXXXXX
-----------------------------
Xxxxx X. Xxxxxxx
/s/ XXXX X. XXXXXXXXX
-----------------------------
Xxxx X. Xxxxxxxxx
INDEX TO EXHIBITS
Exhibit 1 Corporations whose capital Stock is wholly
or majority owned by Royce
Exhibit 2 Exceptions to Exhibit 1 and representations
and warranties contained in Section 2
Exhibit 3 Patents, patent applications, inventions,
disclosures, copyrights, trademarks, trade
names, and licenses owned by the Company and
exceptions thereto
Exhibit 4 Officers and Directors of the Company, and
employees with certain levels of
compensation
Exhibit 5 Description of real property owned by the
Company
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