COMMON STOCK PURCHASE AGREEMENT
Exhibit
10.03
This Common Stock Purchase Agreement
(this “Agreement”) is
made and entered into as of the 30th day of December, 2008 by and between Amber
Alert Safety Centers, Inc., a Nevada corporation (the “Company”), and Xxxx Xxxxxx
Bridge & Opportunity Fund, L.P. (the “Investor”).
ARTICLE
I.
RECITALS
1.01 Company. The
Company has two authorized classes of its capital stock, that being its $.0001
par value common stock (the “Common Stock”) and preferred
stock (the “Preferred
Stock”).
1.02 Consideration. Each
of the Parties acknowledges that each has given and received good, valuable and
present consideration to support each of the obligations of the Parties under
this Agreement.
ARTICLE
II.
TRANSACTION TO BE EFFECTED
PURSUANT TO THIS AGREEMENT
2.01 Issuance and Sale of Common
Stock for Cash. Subject to the terms and conditions of this
Agreement, at the Closing, the Company shall issue and sell to the Investor, and
the Investor shall purchase from the Company, Seven Million Five Hundred
Thousand (7,500,000) shares of Common Stock (the “Investor’s Common Stock”) for
an aggregate purchase price of Ten Thousand Dollars ($10,000).
2.02 Determination of Purchase
Price for the Investor’s Common Stock. The Company and the
Investor acknowledge that the purchase price for the Investor’s Common Stock
under this Agreement is fair and reasonable and has been determined by
negotiation, with each of the Parties considering, among other factors, the
following:
(a) the need
for capital for growth; and
(b) the
existence of the current global credit crisis that has had a negative impact on
the Company’s ability to obtain financing.
2.03 Registration Rights
Agreement. When issued, the Investor’s Common Stock shall have
the benefit of that certain Registration Rights Agreement dated as of the date
hereof (the “Registration
Rights Agreement”).
1
ARTICLE
III.
CLOSINGS
3.01 Purchase
Agreement. Contemporaneously with the execution of this
Agreement, Investor and the Company shall have entered into that certain
purchase agreement (the “Purchase Agreement”) pursuant
to which, among other things, Investor will agree to purchase from the Company a
principal amount of $740,000 debenture (the “Debenture”), subject to
certain terms and conditions.
3.02 Shareholder
Agreement. Contemporaneously with the execution of this
Agreement, the majority shareholders of the Company shall have entered into a
shareholders agreement, in the form attached hereto as Appendix I (the “Shareholder Agreement”),
pursuant to which, among other things, the Investor shall have the right to
appoint up to four directors to the Company’s board of directors.
3.02 Date and Place of
Closing. The closing (the “Closing”) hereunder with
respect to the issuance and sale of the shares of Common Stock and the
consummation of the related transactions contemplated hereby shall, subject to
the satisfaction or waiver of the applicable conditions set forth in Article
VII, take place at the offices of Xxxxxx & Xxxxxxxxx, P.C., 0 Xxxxxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxx 00000 at the same time and on the same date (the
“Closing Date”) as the
closing of the sale of the Debenture.
3.03 Deliveries at
Closing.
(a) At, or
prior to, the Closing, the Company shall:
(i) deliver
to the Investor a copy certified by the Secretary of State of the State of
Nevada of the Articles of Incorporation of the Company and all amendments
thereto;
(ii) deliver
to the Investor a Secretary’s Certificate executed by the Secretary of the
Company certifying to and attaching (A) the Bylaws of the Company and all
amendments thereto, (B) the resolutions of the Board of Directors of the Company
authorizing and approving the execution, delivery and performance of this
Agreement and the Transaction Documents;
(iii) deliver
to the Investor a certificate evidencing the Investor’s Common Stock in
customary form and containing only the restrictive legend described in Section
5.03 below;
(iv) execute
and deliver to the Investor the Registration Rights Agreement; and
(v) execute
and deliver to the Investor the Shareholder Agreement.
(b) At the
Closing, the Investor shall:
(i) deliver
to the Company the purchase price for the Investor’s Common Stock;
(ii) execute
and deliver to the Company the Registration Rights Agreement; and
(iii) execute
and deliver to the Company the Shareholder Agreement
ARTICLE
IV.
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY
4.01 Representations and
Warranties of the Company. The Company represents and warrants
to the Investor as set forth in this Article IV.
4.02 Organization and Standing of
the Company; Authority. The Company is a corporation duly
organized, validly existing and in good standing under the laws of Nevada with
the power and authority to own and lease its properties (as applicable) and to
carry on its business as now being conducted and is qualified and authorized to
do business, in all jurisdictions in which the character of its properties or
the nature of its businesses requires such qualification or authorization.
The Company is duly and validly authorized by all necessary corporate action,
has full power and authority to and has taken or caused to be taken all
necessary action to authorize it to execute and deliver this Agreement and the
Transaction Documents, and to perform and comply with the terms, conditions, and
agreements set forth herein and therein.
4.03 Capitalization of the
Company. Immediately prior to execution of this Agreement and
the Closing:
(a) the
authorized capital stock of the Company consists entirely of One Hundred Million
(100,000,000) shares of Common Stock, and One Hundred (100) shares of Preferred
Stock;
(b) 21,945,529
shares of Common Stock are issued and outstanding, 100 shares of Preferred Stock
are issued or outstanding, and the Company has outstanding warrants to purchase
Common Stock in the aggregate amount of 1,000,000 shares;
(c) the
Company has no issued or outstanding capital stock or obligations to issue
capital stock except as set forth in subsection (b) above.
4.04 Duly
Issued. Upon issuance and delivery to the Investor of the
Investor’s Common Stock against payment of the purchase price therefore pursuant
to this Agreement, such shares will be validly issued, fully paid and
non-assessable shares of Common Stock, and will be free and clear of all liens,
charges, restrictions, claims and encumbrances imposed by or through the
Company.
4.05 No
Conflict. The execution, delivery and performance of this
Agreement and the other Transaction Documents to which the Company is a party
will not violate the Articles of Incorporation or Bylaws of the Company and will
not violate any provision of law, or order of any court or governmental agency
affecting the Company in any respect, and will not conflict with, result in a
breach of the provisions of, constitute a default under any material agreement
binding on the Company, or result in the imposition of any lien, charge, or
encumbrance upon any assets of the Company that could have a Material Adverse
Effect. No approval or consent from any third party not already
obtained is required in connection with the execution of or performance under
this Agreement or the Transaction Documents.
4.06 Governmental Authorization:
Third Party Consents. The Company is in compliance with all
(x) material contracts and (y) laws, rules or regulations, orders, judgments,
writs, injunctions, decrees, determinations, awards of any applicable
governmental authority and all governmental approvals. No consent or
approval of, giving of notice to, registration with, or taking of any other
action in respect of any state, federal or other governmental authority or
agency is required of the Company with respect to the execution, delivery and
performance by the Company of its obligations under this Agreement, except for
the filing of notices pursuant to applicable state securities law, which filings
will be made by the time required thereby.
2
ARTICLE
V.
REPRESENTATIONS AND
WARRANTIES OF INVESTOR
5.01 Representations and
Warranties of the Investor. The Investor represents and
warrants to the Company as set forth in this Article V.
5.02 Authorization;
Authority. This Agreement has been duly authorized and
executed by the Investor and constitutes a valid agreement binding upon the
Investor, enforceable in accordance with its terms (except to the extent that
such enforceability may be limited by bankruptcy or similar laws affecting
creditors’ rights generally or by general equitable
principles). Investor has the full legal right, power and authority
to enter into this Agreement and to perform such Investor’s obligations
hereunder and thereunder upon the terms and conditions herein and therein set
forth.
5.03 Securities Not
Registered. The Investor is acquiring the shares of Common
Stock being purchased for Investor’s own account and not with a view to or for
sale in connection with the distribution thereof in violation of applicable
securities laws. Investor has been advised that the shares of the
Common Stock to be issued and sold hereunder have not been registered under the
Securities Act, or applicable state securities laws and that they must be held
indefinitely unless the offer and sale thereof are subsequently registered under
the Securities Act or any exemption from such registration is
available. Investor acknowledges and agrees that the certificates
representing the shares of the Investor’s Common Stock will bear a restrictive
legend in substantially the following form:
|
|
“THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS. THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT
BE OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR SOLD IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE SECURITIES ACT
OF 1933, A “NO ACTION” LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION
WITH RESPECT TO SUCH OFFER FOR SALE OR SALE, COMPLIANCE WITH RULE 144
UNDER THE SECURITIES ACT OF 1933, OR AN OPINION OF COUNSEL SATISFACTORY TO
THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.”
|
The
Investor further acknowledges and agrees that the Company may issue appropriate
“stop transfer” instructions to its transfer agent, if any, with respect to such
securities and/or make appropriate notations to such effect in its own transfer
records.
5.04 Investment Experience,
Etc. The Investor represents that such Investor (i) has
such knowledge and experience in financial and business matters that such
Investor is capable of evaluating the merits and risks of the purchase of the
Investor’s Common Stock, (ii) has a net worth significantly in excess of the
amount of the purchase price for the Investor’s Common Stock and is able to bear
the economic risk of a complete loss on the purchase of the Investor’s Common
Stock, and (iii) is an “accredited investor” as that term is defined in
Rule 501(a) of Regulation D under the Securities Act.
5.05 Finder’s
Fees. The Investor has not incurred any liability for
commissions or other fees to any finder, broker or agent in connection with the
transactions contemplated by this Agreement.
3
ARTICLE
VI.
COVENANTS OF THE
COMPANY
With respect
to Section 6.01 through 6.09, until the date Investor shall own less than fifty
percent (50.0%) of the Investor’s Common Stock, the Company shall comply with
the covenants set forth in Section 6.01 through 6.09. With respect to
Section 6.10, for a period of the earlier of (i) repayment of the Debenture in
full and (ii) one year from the effective date of the first registration
statement filed with the Securities and Exchange Commission as described in the
Registration Rights Agreement, the Company shall comply with the covenants set
forth in Section 6.10:
6.01 Maintenance of Corporate
Existence, etc. Maintain in full force and effect its
corporate existence, rights and franchises and all licenses and other rights in
or to use patents, processes, licenses, trademarks, trade names or copyrights
owned or possessed by it of any subsidiary and deemed by the Company to be
necessary to the conduct of their business.
6.02 Prompt Payment of Taxes,
etc. Promptly pay and discharge, or cause to be paid and
discharge, when due and payable, all lawful taxes, assessments and governmental
charges or levies imposed upon the income, profits, property or business of the
Company or any subsidiary; provided, however, that any such tax, assessment,
charge or levy need not be paid if the validity thereof shall currently be
contested in good faith by appropriate proceedings and if the Company shall have
set aside on its books adequate reserves with respect thereto and provided,
further, that the Company will pay all such taxes, assessments, charges or
levies forthwith upon the commencement of proceedings to foreclose any lien
which may have attached as security therefore. The Company will promptly pay or
cause to be paid when due, or in conformance with customary trade terms or
otherwise in accordance with policies related thereto adopted by the Company’s
Board of Directors, all other indebtedness incident to operations of the
Company.
6.03 Accounts and
Records. Keep true records and books of account in which full,
true and correct entries will be made of all dealings or transactions in
relation to its business and affairs in accordance with generally accepted
accounting principles applied on a consistent basis.
6.04 Compliance with Requirements
of Government Authorities. Duly observe and conform to all
valid requirements of governmental authorities relating to the conduct of their
businesses or to their properties or assets.
6.05 Visits and
Inspections. Permit representatives of each Investor, from
time to time, as often as may be reasonably requested, but only during normal
business hours and upon reasonable prior notice, to visit and inspect its
properties; inspect, audit and make extracts from its books, records and files,
including, but not limited to, management letters prepared by independent
accountants; and discuss with its principal officers and its independent
accountants, its business, assets, liabilities, financial condition, results of
operations and business prospects (and by this provision the Company authorizes
such accountants to discuss the finances and affairs of the
Company).
6.06 Conduct of
Business. Engage only in business consisting primarily of
business conducted on the Closing Date and other businesses reasonably related
thereto.
6.07 Use of
Proceeds. Use the proceeds of the sale of the Investor’s
Common Stock only for the purposes for working capital.
6.08 Compliance with
Agreements. Perform and observe all of its material
obligations to the Investor, set forth in this Agreement, the Transaction
Documents, and the Certificate of Incorporation, Bylaws or other organizational
and governing documents of the Company.
6.09 Compliance with Transaction
Documents. Comply in all material respects with each term,
condition and provision of the Articles of Incorporation, Bylaws and the other
Transaction Documents.
6.10 Anti-dilution
Protection. The Company shall issue Investor additional shares
of Common Stock for a purchase price equal to the par value of the Common Stock
so that the amount of Investor’s Common Stock shall not be less than three
percent (3%) of the fully diluted issued and outstanding capital stock of the
Company, after giving effect to all outstanding derivative securities regardless
of whether such derivative securities have vested, or exercisable or
convertible.
4
ARTICLE
VII.
CONDITION TO INVESTOR’S
OBLIGATION TO CLOSE
7.01 Conditions. The
obligation of Investor to close the purchase of the Investor’s Common Stock and
to effect the Closing shall be expressly subject to, and conditioned upon,
satisfaction of the following conditions:
(a) all of
the warrants and representations of the Company being true, correct, complete
and accurate; and
(b) full and
timely performance by the Company of all of its obligations and covenants under
this Agreement and each of the Transaction Documents.
ARTICLE
VIII.
INDEMNIFICATION
8.01 Indemnification. In
addition to all other sums due hereunder or provided for in this Agreement, the
Company agrees to indemnify and hold harmless Investor and its Affiliates and
their officers, directors, agents, employees, subsidiaries, partners and
controlling Persons (each, an “Indemnified Party”) to the
fullest extent permitted by law, from and against any and all out-of-pocket
losses, claims, damages, expenses (including reasonable fees, disbursements and
other charges of counsel) or other liabilities (collectively, “Liabilities”) resulting from
or arising out of (a) any breach of any representation or warranty, covenant or
agreement of the Company in this Agreement or any of the other Transaction
Documents or (b) any investigation or proceeding against the Company or any
Indemnified Party and arising out of or in connection with this Agreement or any
of the Transaction Documents, whether or not the transactions contemplated by
this Agreement are consummated, which investigation or proceeding requires the
participation of, or is commenced or filed against, any Indemnified Party
because of this Agreement, any other Transaction Document or such other
documents and the transactions contemplated hereby or thereby, provided, that
the Company shall not be liable under this Section 8.01 to an Indemnified Party for any liabilities
resulting primarily from any actions that involved the gross negligence or
willful misconduct of such Indemnified Party; and provided, further, that if and
to the extent that such indemnification is unenforceable for any reason, the
Company shall make the maximum contribution to the payment and satisfaction of
such Liabilities for which it would otherwise be liable hereunder which shall be
permissible under applicable laws. In connection with the obligation
of the Company to indemnify for Liabilities as set forth above, the Company
further agrees, upon presentation of appropriate invoices containing reasonable
detail, to reimburse each Indemnified Party for all such Liabilities (including
reasonable fees, disbursements and other charges of counsel) as they are
incurred by such Indemnified Party; provided, that if an Indemnified Party is
reimbursed hereunder for any Liabilities, such reimbursement of Liabilities
shall be refunded to the extent it is finally judicially determined that the
Liabilities in question resulted primarily from the willful misconduct or gross
negligence of such Indemnified Party. The obligations of the Company
under this paragraph will survive any transfer of the Investor’s Common
Stock. In the event that the foregoing indemnity is unavailable or
insufficient to hold an Indemnified Party harmless, then the Company will
contribute to amounts paid or payable by such Indemnified Party in respect of
such Indemnified Party’s Liabilities in such proportions as appropriately
reflect the relative benefits received by and fault of the Company and such
Indemnified Party in connection with the matters as to which such Liabilities
relate and other equitable considerations.
8.02 Notification. Each
Indemnified Party under this Article VIII will, promptly after the receipt of
notice of the commencement of any action, investigation, claim or other
proceeding against such Indemnified Party in respect of which indemnity may be
sought from the Company under this Article VIII, notify the Company in writing
of the commencement thereof. The omission of any Indemnified Party so
to notify the Company of any such action shall not relieve the Company from any
liability which it may have to such Indemnified Party under this Article VIII
unless, and only to the extent that, such omission results in the Company’s
forfeiture of substantive rights or defenses or the Company is otherwise
irrevocably prejudiced in defending such proceeding. In case any such
action, claim or other proceeding shall be brought against any Indemnified Party
and it shall notify the Company of the commencement thereof, the Company shall
be entitled to assume the defense thereof at its own expense, with counsel
satisfactory to the Company; provided, that any Indemnified Party may, at its
own expense, retain separate counsel to participate in such
defense. Notwithstanding the foregoing, in any action, claim or
proceeding in which both the Company, on the one hand, and an Indemnified Party,
on the other hand, is, or is reasonably likely to become, a party, such
Indemnified Party shall have the right to employ separate counsel at the
Company’s expense and to control its own defense of such
action, claim or proceeding if, (a) the Company has failed to assume the defense
and employ counsel as provided herein, (b) the Company has agreed in writing to
pay such fees and expenses of separate counsel or (c) in the reasonable opinion
of counsel to such Indemnified Party, a conflict or likely conflict exists
between the Company, on the one hand, and such Indemnified Party, on the other
hand, that would make such separate representation advisable, provided, however,
that the Company shall not in any event be required to pay the fees and expenses
of more than one separate counsel (and if deemed necessary by such separate
counsel, appropriate local counsel who shall report to such separate
counsel). The Company agrees that it will not, without the prior
written consent of an Indemnified Party, settle, compromise or consent to the
entry of any judgment in any pending or threatened claim, action or proceeding
relating to the matters contemplated hereby (if such Indemnified Party is a
party thereto or has been actually threatened to be made a party thereto) unless
such settlement, compromise or consent includes an unconditional release of such
Indemnified Party from all liability arising or that may arise out of such
claim, action or proceeding. The Company shall not be liable for any
settlement of any claim, action or proceeding effected against an Indemnified
Party without the prior written consent of the Company. The rights
accorded to Indemnified Parties hereunder shall be in addition to any rights
that any Indemnified Party may have at common law, by separate agreement or
otherwise.
5
ARTICLE
IX.
MISCELLANEOUS
9.01 Governing
Law. This Agreement shall be governed by and construed in all
respects by the internal laws of the State of Texas (except for the proper
application of the United States federal securities laws), without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of Texas or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of Texas.
9.02 Notices,
Etc. Unless otherwise specified within a provision of this
Agreement all notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by
facsimile (provided confirmation of transmission is electronically or
mechanically generated and kept on file by the sending party); (iii) three
Business Days after deposit with the United States Mail when sent by registered
or certified mail; or (iv) one Business Day after deposit with a nationally
recognized overnight delivery service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for
such communications shall be:
If to the
Company:
Amber
Alert Safety Centers, Inc.
000
Xxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxxx,
XX 00000
Attention: Xxx
Xxxxxxxxx
If to the
Investor:
Xxxx
Xxxxxx Bridge & Opportunity Fund, L.P.
0
Xxxxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxx 00000
Attention: Xxxxxx
Xxxxxxx
9.03 Amendments and
Waivers.
(a) This
Agreement may be terminated, amended or modified, by a written instrument
executed by (a) the Company, and (b) the Investor.
(b) Any
obligation of the Company under this Agreement may be waived or excused by the
Investor.
9.04 Gender. Wherever
herein the singular number is used, the same shall include the plural, and the
masculine gender shall include the feminine and neuter genders, and vice versa,
as the context may require.
9.05 Certain
Expenses. Each party shall be responsible for their own costs
and expenses.
9.06 Section and Other
Headings. The section and other headings contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
9.07 Counterparts. This
Agreement may be executed simultaneously in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
9.08 Severability. If
any provision of this Agreement is held by final judgment of a court of
competent jurisdiction to be invalid, illegal or unenforceable, such invalid,
illegal or unenforceable provision shall be severed from the remainder of this
Agreement, and the remainder of this Agreement shall be enforced. In
addition, the invalid, illegal or unenforceable provision shall be deemed to be
automatically modified, and, as so modified, to be included in this Agreement,
such modification being made to the minimum extent necessary to render the
provision valid, legal and enforceable. Notwithstanding the
foregoing, however, if the severed or modified provision concerns all or a
portion of the essential consideration to be delivered under this Agreement by
one party to the other, the remaining provisions of this Agreement shall also be
modified to the extent necessary to equitably adjust the parties’ respective
rights and obligations hereunder.
6
9.09 Telecopy Execution and
Delivery. A facsimile, telecopy or other reproduction of this
Agreement may be executed by one or more parties hereto, and an executed copy of
this Agreement may be delivered by one or more parties hereto by facsimile or
similar electronic transmission device pursuant to which the signature of or on
behalf of such party can be seen, and such execution and delivery shall be
considered valid, binding and effective for all purposes. At the
request of any party hereto, all parties hereto agree to execute an original of
this Agreement as well as any facsimile, telecopy or other reproduction
hereof.
9.10 Entire
Agreement. This Agreement and the other Transaction Documents
constitute the entire agreement between the parties with respect to the subject
matter hereof and thereof. All proposals, negotiations and
representations (if any) made prior, and with reference to the subject matter of
this Agreement, are merged herein. This Agreement has been negotiated
by the parties and their respective counsel and will be interpreted fairly in
accordance with its terms and without any strict construction in favor of or
against either party. Neither the Company nor the Investor shall be
bound by any oral agreement or representation, irrespective of when
made.
9.11 Survival of Representations,
Warranties and Covenants. All of the representations and
warranties made herein shall survive the execution and delivery of this
Agreement, any investigation by or on behalf of the Investor, or acceptance of
the shares of Common Stock and payment therefore and shall survive until such
time as the shares of Common Stock have been sold or redeemed in full in
cash. All covenants and indemnities made herein shall survive in
perpetuity, unless otherwise provided in this Agreement.
9.12 Remedies
Cumulative. No failure or delay on the part of the Company or
the Investor in exercising any right, power or remedy hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies provided for herein
are cumulative and are not exclusive of any remedies that may be available to
the Company or the Investor at law, in equity or otherwise.
9.13 Further
Assurances. Each of the parties shall execute such documents
and perform such further acts (including, without limitation, obtaining any
consents, exemptions, authorizations, or other actions by, or giving any notices
to, or making any filings with, any Governmental Authority or any other Person)
as may be reasonably required or desirable to carry out or to perform the
provisions of this Agreement or any of the Transaction Documents.
9.14 Disputes. The
parties agree that all disputes arising under this Agreement shall be submitted
to a court of competent jurisdiction located in Houston, Xxxxxx County,
Texas.
9.15 WAIVER OF JURY
TRIAL. EACH OF THE PARTIES WAIVES ITS RIGHTS TO TRIAL BY JURY
AND AGREES TO SUBMIT ANY LAWSUIT TO TRIAL BEFORE THE COURT AND WITHOUT A
JURY.
ARTICLE
X.
DEFINITIONS
10.01 Definitions. As
used in this Agreement, and unless the context requires a different meaning, the
following terms have the meanings indicated:
“Affiliate” means, with respect
to a Person, (a) any director, executive officer, general partner, managing
member or other manager of such Person, (b) any other Person which directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such Person and (c) if such Person is an
individual, any member of the immediate family (including parents, spouse and
children) of such individual, any trust whose principal beneficiary is such
individual or one or more members of such individual’s immediate family and any
Person who is controlled by any such member or trust. The term “control” means
(i) the power to vote more than 50% of the securities or other equity interests
of a Person having ordinary voting power (on a fully diluted basis), or (ii) the
possession, directly or indirectly, of any other power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.
7
“Agreement” means this Common
Stock Purchase Agreement, as amended, modified or supplemented from time to
time.
“Articles of Incorporation”
means the Articles of Incorporation of the Company and as in effect on the
Closing Date, including, all amendments and restatements of the
same.
“Board of Directors” shall mean
the group that manages the business and affairs of the Company as described in
the bylaws of the Company.
“Business Day” means any day
other than a Saturday, Sunday or other day on which commercial banks in Houston,
Texas are authorized or required by law or executive order to
close.
“Code” means the Internal
Revenue Code of 1986, as amended, or any successor
statute thereto.
“Commission” means the
Securities and Exchange Commission or any similar agency then having
jurisdiction to enforce the Securities Act.
“Common Stock” has the meaning
set forth in Section 1.01 of this Agreement.
“Company” means Amber Alert
Safety Centers, Inc., a Nevada corporation.
“GAAP” means generally accepted
United States accounting principles set forth in the opinions and pronouncements
of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board that are applicable to the circumstances as of the date of
determination.
“Governmental Authority” means
the government of any nation, state, city, locality or other political
subdivision of any thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
“Material Adverse Change” means
a material adverse change in the business, assets, operations, condition
(financial or otherwise), results of operations or prospects of the Company or
any Subsidiary of the Company.
“Material Adverse Effect” means
a material adverse effect upon the business, assets, operation, condition
(financial or otherwise), results of operations or prospects of the Company or
any Subsidiary of the Company.
“Person” means any individual,
firm, corporation, partnership, trust, limited liability company, incorporated
or unincorporated association, joint venture, joint stock company, Governmental
Authority or other entity of any kind, and shall include any successor (by
merger or otherwise) of such entity.
“Subsidiary” means, as to any
Person, (i) any corporation more than fifty percent (50%) of whose stock of any
class or classes having by the terms thereof ordinary voting power to elect a
majority of the directors of such corporation (irrespective of whether or not at
the time stock of any class or classes of such corporation shall have or might
have voting power by reason of the happening of any contingency) is at the time
owned such Person and/or one or more Subsidiaries of such Person and (ii) any
partnership, limited liability company, association, joint venture or other
entity in which such Person and/or one or more Subsidiaries of such Person has
more than a 50% equity interest at the time.
“Transaction Documents” means,
collectively, this Agreement, the Debenture, the Purchase Agreement, the
Security Agreement, the Registration Rights Agreement, the Shareholder
Agreement, and all other documents, certificates or agreements entered into or
delivered in connection with any of the foregoing.
“United States” and “U.S.” shall mean the United
States of America.
10.02 Accounting Terms: Financial
Statements. All accounting terms used herein not expressly
defined in this Agreement shall have the respective meanings given to them in
accordance with sound accounting practice. The term “sound accounting
practice” shall mean such accounting practice as, in the opinion of the
independent certified public accountants regularly retained by the Company,
conforms at the time to GAAP applied on a consistent basis except for changes
with which such accountants concur.
[remainder
of page intentionally left blank]
8
IN WITNESS WHEREOF, the parties have
duly executed this Agreement as of the day and year first above
written.
AMBER
ALERT SAFETY CENTERS, INC.
By: /s/ XXX
XXXXXXXXX
Name: Xxx
Xxxxxxxxx
Title: Chief
Executive Officer
INVESTOR:
XXXX
XXXXXX BRIDGE & OPPORTUNITY FUND, L.P.
By: /s/ XXXXXX X. XXXXXXX,
XX.
Name: Xxxxxx
X. Xxxxxxx, Xx.
Title: Managing
Member of the General Partner
9
