MEMBERSHIP INTEREST PURCHASE AGREEMENT DATED AS OF SEPTEMBER 27, 2006 SECURED FINANCIAL NETWORK, INC. and VIRTUAL PAYMENT SOLUTIONS, LLC
DATED
AS
OF SEPTEMBER 27, 2006
and
VIRTUAL
PAYMENT SOLUTIONS, LLC
TABLE
OF CONTENTS
| ARTICLE | PAGE | ||
| 1 | Purchase and Sale of Stock. |
1
|
|
| 1.1 | Agreement to Purchase and Sell. |
1
|
|
| 1.2 | Purchase Price. |
1
|
|
| 1.3 | Payment of Purchase Price. |
1
|
|
| 1.4 | Closing. |
1
|
|
| 2 | Representations and Warranties of Seller. |
2
|
|
| 2.1 | Existence and Good Standing. |
2
|
|
| 2.2 | Corporate Authority. |
2
|
|
| 2.3 | Compliance with Law. |
2
|
|
| 2.4 | Validity and Effect of Agreements. |
2
|
|
| 2.5 | No Required Consents or Defaults. |
2
|
|
| 2.6 | Affiliated Entities. |
3
|
|
| 2.7 | Capitalization. |
3
|
|
| 2.8 | Jurisdictions. |
3
|
|
| 2.9 | Records. |
3
|
|
| 2.10 | Officers and Directors. |
3
|
|
| 2.11 | Financial Statements. |
3
|
|
| 2.12 | Undisclosed Liabilities. |
3
|
|
| 2.13 | Absence of Certain Changes or Events Since the Date of the Unaudited Balance Sheet. |
4
|
|
| 2.14 | Taxes. |
5
|
|
| 2.15 | Title to Company Interest. |
5
|
|
| 2.16 | Title to Property and Assets. |
5
|
|
| 2.17 | Condition of Personal Property. |
5
|
|
| 2.18 | Real Estate and Leases. |
5
|
|
| 2.19 | List of Contracts and Other Data. |
6
|
|
| 2.20 | Business Property Rights. |
6
|
|
| 2.21 | No Breach or Default. |
7
|
|
| 2.22 | Labor Controversies. |
7
|
|
| 2.23 | Litigation. |
7
|
|
| 2.24 | Bank Accounts. |
7
|
|
| 2.25 | Powers of Attorney. |
7
|
|
| 2.26 | Insurance. |
7
|
|
| 2.27 | No Brokers. |
8
|
|
| 2.28 | No Misrepresentation or Omission. |
8
|
|
| 3 | Representations and Warranties of Buyer. |
8
|
|
| 3.1 | Existence and Good Standing. |
8
|
|
| 3.2 | Corporate Authority. |
8
|
|
| 3.3 | Compliance with Law. |
8
|
|
| 3.4 | Authorization; Validity and Effect of Agreements. |
8
|
|
| 4 | Other Covenants and Agreements. |
9
|
|
| 4.1 | Section 338 Elections. |
9
|
|
| 4.2 | Indemnification by Seller. |
10
|
|
| 4.3 | Indemnification by Buyer. |
10
|
|
| 4.4 | Tax Indemnity. |
10
|
|
| 4.5 | Conditions of Indemnification. |
10
|
|
| 4.6 | Taxes and Expenses. |
12
|
|
| 4.7 | Company Cooperation. |
12
|
|
| 4.8 | Exclusive Dealing. |
12
|
|
| 4.9 | Public Announcements. |
13
|
|
| 4.10 | Buyers Right of Offset. |
13
|
|
i
| ARTICLE | PAGE | ||
| 5 | Conditions of Closing. |
13
|
|
| 5.1 | Buyers Conditions of Closing. |
13
|
|
| 5.2 | Sellers Conditions of Closing. |
15
|
|
| 6 | Termination. |
15
|
|
| 6.1 | Methods of Termination. |
16
|
|
| 6.2 | Procedure Upon Termination. |
16
|
|
| 7 | Miscellaneous. |
17
|
|
| 7.1 | Notice. |
17
|
|
| 7.2 | Execution of Additional Documents. |
17
|
|
| 7.3 | Binding Effect; Benefits. |
17
|
|
| 7.4 | Entire Agreement. |
17
|
|
| 7.5 | Governing Law. |
18
|
|
| 7.6 | Survival. |
18
|
|
| 7.7 | Counterparts. |
18
|
|
| 7.8 | Headings. |
18
|
|
| 7.9 | Waivers. |
18
|
|
| 7.10 | Merger of Documents. |
18
|
|
| 7.11 | Incorporation of Exhibits and Schedules. |
18
|
|
| 7.12 | Severability. |
19
|
|
| 7.13 | Assignability. |
19
|
|
| EXHIBIT A |
21
|
||
| FORM OF PROMISSORY NOTE |
21
|
||
| EXHIBIT B |
22
|
||
| FORM OF EMPLOYMENT CONTRACT |
22
|
||
| SCHEDULE 2.8 |
23
|
||
| JURISDICTIONS WHERE COMPANY IS LICENSED TO DO BUSINESS |
23
|
||
| SCHEDULE 2.10 |
24
|
||
| OFFICERS AND DIRECTORS OF COMPANY |
24
|
||
| SCHEDULE 2.12 |
25
|
||
| UNDISCLOSED LIABILITIES |
25
|
||
| SCHEDULE 2.18 |
26
|
||
| REAL PROPERTY OWNED/LEASED BY COMPANY |
26
|
||
| SCHEDULE 2.19 |
27
|
||
| LIST OF CONTRACTS AND OTHER DATA |
27
|
||
| SCHEDULE 2.23 |
28
|
||
| PENDING LITIGATION |
28
|
||
| SCHEDULE 2.24 |
29
|
||
| BANK ACCOUNTS |
29
|
||
| SCHEDULE 2.26 |
30
|
||
| INSURANCE POLICIES |
30
|
||
ii
THIS
MEMBERSHIP INTEREST PURCHASE AGREEMENT
(the
“Agreement”) is dated the day of September 27, 2006, by and among SECURED
FINANCIAL NETWORK, INC.,
a
Nevada corporation (the “Buyer”), and VIRTUAL
PAYMENT SOLUTIONS, LLC, a
Nevada
Limited Liability Corporation (hereinafter referred to singularly and
collectively as “VPS”/ “Seller”).
WHEREAS,
Seller
desires to sell, and Buyer desires to purchase, all of the issued and
outstanding units of membership interest of VPS, LLC., a Nevada limited
liability corporation (the “Company”) for the consideration and upon the terms
and subject to the conditions hereinafter set forth.
NOW,
THEREFORE,
in
consideration of the premises, the provisions and the respective agreements
hereinafter set forth, the parties hereto hereby agree as follows:
1. Purchase
and Sale of Stock.
1.1 Agreement
to Purchase and Sell.
Upon
the
terms and subject to the conditions set forth in this Agreement and upon the
representations and warranties made herein by each of the parties to the other,
on the Closing Date (as such term is hereinafter defined), Seller shall sell,
grant, convey, assign, transfer and deliver to Buyer, and Buyer shall purchase
and acquire from Seller, all of the issued and outstanding units of membership
interest of the Company (the "Company Interest"). The exact number of Company
Interest Units to be sold by Seller hereunder is (100) common units, $25,000
par
value per membership unit.
1.2 Purchase
Price.
Upon
the
terms and subject to the conditions set forth in this Agreement, in reliance
upon the representations, warranties, covenants and agreements of Seller
contained herein, and in exchange for the Company Interest, Buyer agrees to
pay
to Seller a purchase price (the “Purchase Price”) of (i) Four Hundred Thousand
Dollars ($400,000.00), (ii) 5 million shares of Common Stock of Buyer (SFNL),
(iii) 2 million shares of Preferred Stock with a conversion value at $1 per
share into Common Stock upon the sale of the Company or after 12 months from
closing.
1.3 Payment
of Purchase Price.
The
Purchase Price shall be payable as follows: (i) by wire transfer of $150,000
Dollars at closing, $150,000 payment on or before 10 business days from closing,
$100,000 on or before October 26, 2006, issuance of 5 million Common shares
of
Buyer Stock, and issuance of 2 million shares of Preferred Stock of buyer within
30 business days of closing. Preferred shares will pay a 7% dividend and the
shares will be convertible at $1 per share into Common Stock of
Company.
1.3
a
HEB, LLC shall receive 20% of the Gross Income generated by clients it brings
to
Company with a maximum payment of $1.5 million in cash royalties.
1
1.4 Closing.
The
closing of the purchase and sale of the Company Interest provided herein (the
"Closing") will be at the office of Seller at 000 X. Xxxxxxx Xxxx., Xx.
Xxxxxxxxxx, Xxxxxxx 00000 on September , 2006. Such date and time of Closing
is
herein referred to as the "Closing Date."
2. Representations
and Warranties of Seller.
Seller
represents and warrants to Buyer as follows:
2.1 Existence
and Good Standing.
The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Nevada. The Company is duly licensed
or
qualified to do business as a foreign corporation and is in good standing under
the laws of Florida.
2.2 Corporate
Authority.
The
Company has all requisite corporate power and authority to carry on its business
as now conducted.
2.3 Compliance
with Law.
The
Company is not in default with respect to any order of any court, governmental
authority or arbitration board or tribunal to which the Company is a party
or is
subject, and the Company is not in violation of any laws, ordinances,
governmental rules or regulations to which it is subject. The Company has
obtained all licenses, permits and other authorizations and has taken all
actions required by applicable laws or governmental regulations in connection
with its business as now conducted.
2.4 Validity
and Effect of Agreements.
This
Agreement constitutes, and all agreements and documents contemplated hereby
when
executed and delivered pursuant hereto will constitute, the valid and legally
binding obligations of Seller enforceable in accordance with their terms, except
that enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws of general
application now or hereafter in effect relating to the enforcement of creditors'
rights generally and except that the remedies of specific performance,
injunction and other forms of equitable relief are subject to certain tests
of
equity jurisdiction, equitable defenses and the discretion of the court before
which any proceeding therefore may be brought.
2.5 No
Required Consents or Defaults.
The
execution and delivery of this Agreement by Seller does not and the consummation
of the transactions contemplated hereby will not (i) require the consent of
any
person not a party to this Agreement, (ii) result in the breach of any term
or
provision of, or constitute a default under, or result in the acceleration
of or
entitle any party to accelerate (whether after the giving of notice or the
lapse
of time or both) any obligation under, or result in the creation or imposition
of any lien, charge, pledge, security interest or other encumbrance upon any
part of the property of the Company pursuant to any provision of, any order,
judgment, arbitration award, injunction, decree, indenture, mortgage, lease,
license, lien, or other agreement or instrument to which Seller or the Company
is a party or by which any of them is bound, or violate or conflict with any
provision of the by-laws or articles/certificate of incorporation of the Company
as amended to the date of this Agreement.
2
2.6 Affiliated
Entities.
The
Company does not own, directly or indirectly, any interest in any corporation,
business trust, joint stock company, partnership or other business organization
or association.
2.7
Capitalization.
The
Company has authorized membership interest consisting solely of (100) membership
units, $25,000 par value per unit, of which (100) units are presently issued
and
outstanding. Except for rights granted pursuant to this Agreement, there are
no
outstanding rights, warrants, options, subscriptions, agreements or commitments
giving anyone any right to require the Company to sell or issue, or the Seller
to sell, any capital stock or other securities of the Company.
2.8 Jurisdictions.
Schedule
2.8 contains a list of all jurisdictions in which the Company is presently
licensed or qualified to do business. The Company has complied in all material
respects with all applicable laws of each such jurisdiction and all applicable
rules and regulations of each regulatory agency therein. The Company has not
been denied admission to conduct any type of business in any jurisdiction in
which it is not presently admitted as set forth in such Schedule 2.8, has not
had its license or qualifications to conduct business in any jurisdiction
revoked or suspended, and has not been involved in any proceeding to revoke
or
suspend a license or qualification.
2.9 Records.
The
corporate minute books of the Company to be delivered to Buyer within 7 days
of
Closing shall contain true and complete copies of the articles of incorporation,
as amended to the Closing Date, bylaws, as amended to the Closing Date, and
the
minutes of all meetings of directors and shareholders and certificates
reflecting all actions taken by the directors or shareholders without a meeting,
from the date of incorporation of the Company to the Closing Date.
2.10 Officers
and Directors.
The
officers and directors of the Company are as set forth in Schedule 2.10.
2.11 Financial
Statements.
Seller
has furnished to Buyer (i) a compiled balance sheet and related statement of
income as of the end of the last fiscal year (the "Compiled Balance Sheet"),
and
(ii) an unaudited balance sheet and related statement of income as of June
30,
2006 (the "Unaudited Balance Sheet") (collectively the "Financial Statements").
The Compiled Balance Sheet and the Unaudited Balance Sheet are hereinafter
collectively referred to as the "Balance Sheets." The Financial Statements
fully
and fairly set forth the financial condition of the Company as of the dates
indicated, and the results of its operations for the periods indicated, in
accordance with GAAP consistently applied, except as otherwise stated therein
and in the related reports of independent accountants.
3
2.12 Undisclosed
Liabilities.
The
Company has no liabilities or obligations whatsoever, whether accrued, absolute,
contingent or otherwise, which are not reflected or provided for in the
Financial Statements except (i) accounts payable and accrued expenses arising
after the date of the Unaudited Balance Sheet which were incurred in the
ordinary course of business, in each case in normal amounts and none of which
is
materially adverse, and (ii) liabilities as and to the extent specifically
described in Schedule 2.12.
2.13 Absence
of Certain Changes or Events Since the Date of the Unaudited Balance
Sheet.
Since
the
date of the Unaudited Balance Sheet, the Company has not:
(A) incurred
any liability whatsoever, whether accrued, absolute, contingent or otherwise,
except those liabilities and obligations referred to in Section 2.12 above,
and
except in connection with this Agreement and the transactions contemplated
hereby;
(B) discharged
or satisfied any lien, security interest or encumbrance or paid any obligation
or liability (fixed or contingent), other than in the ordinary course of
business and consistent with past practice;
(C) mortgaged,
pledged or subjected to any lien, security interest or other encumbrance any
of
its assets or properties;
(D) transferred,
leased or otherwise disposed of any of its assets or properties except for
a
fair consideration in the ordinary course of business and consistent with past
practice or, except in the ordinary course of business and consistent with
past
practice, acquired any assets or properties;
(E) canceled
or compromised any debt or claim, except in the ordinary course of business
and
consistent with past practice;
(F) waived
or
released any rights of material value;
(G) except
pursuant to those contracts listed on Schedules 2.18 and 2.19 hereto,
transferred or granted any rights under any concessions, leases, licenses,
agreements, patents, inventions, trademarks, trade names, service marks or
copyrights or with respect to any know-how;
(H) made
or
granted any wage or salary increase applicable to any group or classification
of
employees generally, entered into any employment contract with, or made any
loan
to, or entered into any material transaction of any other nature with, any
officer or employee of the Company;
(I) entered
into any transaction, contract or commitment, except (i) contracts listed on
Schedules 2.18 and 2.19 hereto and (ii) this Agreement and the transactions
contemplated hereby;
(J) suffered
any casualty loss or damage (whether or not such loss or damage shall have
been
covered by insurance) which affects in any material respect its ability to
conduct business, or suffered any casualty loss or damage in excess of
$25,000.00 and which is not covered by insurance; or
4
(K) declared
any dividends or bonuses, or authorized or affected any amendment or restatement
of the articles of incorporation or by-laws of the Company or taken any steps
looking toward the dissolution or liquidation of the Company.
Between
the date of this Agreement and the Closing, the Company will not, without prior
written notice to Buyer, do any of the things listed in sub-paragraphs (A)
through (K) above.
2.14 Taxes.
The
Company (i) has duly and timely filed or caused to be filed all federal, state,
local and foreign tax returns (including, without limitation, consolidated
and/or combined tax returns) required to be filed by it prior to the date of
this Agreement which relate to the Company or with respect to which the Company
or the assets or properties of the Company are liable or otherwise in any way
subject, (ii) has paid or fully accrued for all taxes shown to be due and
payable on such returns (which taxes are all the taxes due and payable under
the
laws and regulations pursuant to which such returns were filed), and (iii)
has
properly accrued for all such taxes accrued in respect of the Company or the
assets and properties of the Company for periods subsequent to the periods
covered by such returns. No deficiency in payment of taxes for any period has
been asserted by any taxing body and remains unsettled at the date of this
Agreement. Copies of all federal, state, local and foreign tax returns of the
Company have been made available for inspection by Buyer.
2.15 Title
to Company Interest.
The
Company Interest are duly authorized, validly issued, fully paid and
nonassessable and are owned by Seller free and clear of all liens, encumbrances,
charges, assessments and adverse claims. The Company Interest are subject to
no
restrictions with respect to transferability to Buyer in accordance with the
terms of this Agreement. Upon transfer of the Company Interest by Seller, Buyer
will, as a result, receive good and marketable title to all of the Company
Interest, free and clear of all security interests, liens, encumbrances,
charges, assessments, restrictions and adverse claims.
2.16 Title
to Property and Assets.
The
Company has good and marketable title to all of the properties and assets
reflected in the Balance Sheets and the Business Property Rights (as defined
in
Section 2.20). None of such properties or assets is, except as disclosed in
said
Balance Sheets or the Schedules hereto, subject to a contract of sale not in
the
ordinary course of business, or subject to security interests, mortgages,
encumbrances, liens or charges of any kind or character.
2.17 Condition
of Personal Property.
All
tangible personal property, equipment, fixtures and inventories included within
the assets of the Company are in good, merchantable or in reasonably repairable
condition and are suitable for the purposes for which they are used. No value
in
excess of applicable reserves has been given to any inventory with respect
to
obsolete or discontinued products. To the best of the Company’s knowledge, all
of the inventories and equipment, including equipment leased to others, are
well
maintained and in good operating condition. N/A
there is no personal property, equipment, fixtures, or inventory held by VPS,
LLC
5
2.18 Real
Estate and Leases.
Schedule
2.18 contains a list of all real property owned by the Company or in which
the
Company has a leasehold or other interest (whether as landlord, tenant or
otherwise) and of any lien, charge or encumbrance thereupon. Such Schedule
also
contains a substantially accurate description identifying all such real property
and the significant rental terms (including rents, termination dates and renewal
conditions). N/A
There is no real property owned by VPS, LLC
2.19 List
of Contracts and Other Data.
Schedule
2.19 sets forth the following:
(A) (i)
all
computer software, patents and registrations for trademarks, trade names,
service marks and copyrights which are unexpired as of the date of this
Agreement and which are owned by the Company, as well as all applications
pending on said date for patents or for trademark, trade name, service xxxx
or
copyright registrations, and all other proprietary rights, owned or held by
the
Company, and (ii) all licenses granted by or to the Company and all other
agreements to which the Company is a party and which relate, in whole or in
part, to any items of the categories mentioned in sub-paragraph (A) above or
to
other proprietary rights of the Company which are reasonably necessary to,
or
used in connection with, the business of the Company;
(B) all
collective bargaining agreements, employment and consulting agreements,
executive compensation plans, bonus plans, profit-sharing plans, deferred
compensation agreements, employee pension or retirement plans, employee stock
purchase and stock option plans, group life insurance, hospitalization insurance
or other plans or arrangements providing for benefits to employees of the
Company;
(C) all
contracts, understandings and commitments (including, without limitation,
mortgages, indentures and loan agreements) to which the Company is a party,
or
to which it or any of its assets or properties are subject and which are not
specifically referred to in sub-paragraphs (A) or (B) above or in Schedule
2.18
hereof;
(D) the
names
and current annual compensation rates of all employees of the Company;
and
(E) all
customer backlog which is represented by firm purchase orders, identifying
the
customers, products and purchase prices.
True
and
complete copies of all documents and complete descriptions of all oral
understandings, if any, referred to in Schedules 2.18 and 2.19 have been
provided or made available to Buyer and its counsel.
6
2.20 Business
Property Rights.
The
property referred to in Section 2.19(A) above, together with (i) all designs,
methods, inventions and know-how related thereto and (ii) all trademarks, trade
names, service marks, and copyrights claimed or used by the Company which have
not been registered (collectively "Business Property Rights"), constitute all
such proprietary rights owned or held by the Company. The Company owns or has
valid rights to use all such Business Property Rights without, to the best
of
Seller’s knowledge, conflict with the rights of others. Except as set forth in
Schedule 2.23 hereto, no person or corporation has made or, to the knowledge
of
Seller or the Company, threatened to make any claims that the operation of
the
business of the Company is in violation of or infringes any Business Property
Rights or any other proprietary or trade rights of any third party. To the
knowledge of Seller or the Company, no third party is in violation of or is
infringing upon any Business Property Rights.
2.21 No
Breach or Default.
The
Company is not in 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.
Seller has no reason to believe that the parties to such contracts will not
fulfill their obligations under such contracts in all material respects or
are
threatened with insolvency.
2.22 Labor
Controversies.
The
Company is not a party to any collective bargaining agreement. There are not
any
controversies between the Company and any of its employees which might
reasonably be expected to materially adversely affect the conduct of its
business, or any unresolved labor union grievances or unfair labor practice
or
labor arbitration proceedings pending or threatened relating to its business,
and there are not any organizational efforts presently being made or threatened
involving any of the Company's employees. The Company has not received notice
of
any claim that the Company has not complied with any laws relating to the
employment of labor, including any provisions thereof relating to wages, hours,
collective bargaining, the payment of social security and similar taxes, equal
employment opportunity, employment discrimination and employment safety, or
that
the Company is liable for any arrears of wages or any taxes or penalties for
failure to comply with any of the foregoing. N/A
There are no labor controversies or current employees of VPS,
LLC
2.23 Litigation.
Except
as
set forth in Schedule 2.23, there are no actions, suits or proceedings with
respect to the Company involving claims by or against Seller or the Company
which are pending or threatened against Seller or the Company, at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality. No basis
for
any action, suit or proceeding exists, and there are no orders, judgments,
injunctions or decrees of any court or governmental agency with respect to
which
Seller or the Company has been named or to which Seller or the Company is a
party, which apply, in whole or in part, to the business of the Company, or
to
any of the assets or properties of the Company or the Company Interest or which
would result in any material adverse change in the business or prospects of
the
Company.
7
2.24 Bank
Accounts.
The
name
of each bank, savings institution or other person with which the Company has
an
account and the names and identification of all persons authorized to drawn
thereon or to have access thereto are as set forth on Schedule
2.24.
2.25 Powers
of Attorney.
There
are
no persons holding powers of attorney from the Company.
2.26 Insurance.
A
list of
all insurance policies owned by the Company, together with a brief statement
of
the coverage thereof, are as set forth on Schedule 2.26.
2.27 No
Brokers.
Neither
Seller nor the Company has entered into any contract, arrangement or
understanding with any person or firm which may result in the obligation of
Buyer or the Company to pay any finder's fees, brokerage or agent's commissions
or other like payments in connection with the negotiations leading to this
Agreement or the consummation of the transactions contemplated hereby, and
neither Seller nor the Company is aware of any claim or basis for any claim
for
payment of any finder's fees, brokerage or agent's commissions or other like
payments in connection with the negotiations leading to this Agreement or the
consummation of the transactions contemplated hereby.
2.28 No
Misrepresentation or Omission.
No
representation or warranty by Seller in this Article 2 or in any other Article
or Section of this Agreement, or in any certificate or other document furnished
or to be furnished by Seller pursuant hereto, 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 contained therein not misleading or will
omit to state a material fact necessary in order to provide Buyer with accurate
information as to the Company.
3. Representations
and Warranties of Buyer.
Buyer
represents and warrants to Seller as follows:
3.1 Existence
and Good Standing.
Buyer
is
a corporation duly incorporated, validly existing and in good standing under
the
laws of its jurisdiction of incorporation. Buyer is duly licensed or qualified
to do business as a foreign corporation and is in good standing under the laws
of all other jurisdictions in which the character of the properties owned or
leased by it therein or in which the transaction of its business makes such
qualification necessary.
3.2 Corporate
Authority.
Buyer
has
all requisite corporate power and authority to own its properties and carry
on
its business as now conducted.
3.3 Compliance
with Law.
Buyer
is
not in default with respect to any order of any court, governmental authority
or
arbitration board or tribunal to which Buyer is a party or is subject, and
Buyer
is not in violation of any laws, ordinances, governmental rules or regulations
to which it is subject. Buyer has obtained all licenses, permits or other
authorizations and has taken all actions required by applicable laws or
governmental regulations in connection with its business as now
conducted.
8
3.4
Authorization;
Validity and Effect of Agreements.
The
execution and delivery of this Agreement and all agreements and documents
contemplated hereby by Buyer, and the consummation by it of the transactions
contemplated hereby, have been duly authorized by all requisite corporate
action. This Agreement constitutes, and all agreements and documents
contemplated hereby when executed and delivered pursuant hereto will constitute,
the valid and legally binding obligations of Buyer enforceable in accordance
with their terms, except that enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or
other
similar laws of general application now or hereafter in effect relating to
the
enforcement of creditors' rights generally and except that the remedies of
specific performance, injunction and other forms of equitable relief are subject
to certain tests of equity jurisdiction, equitable defenses and the discretion
of the court before which any proceeding therefor may be brought. The execution
and delivery of this Agreement by Buyer does not and the consummation of the
transactions contemplated hereby will not (i) require the consent of any third
party, (ii) result in the breach of any term or provision of, or constitute
a
default under, or result in the acceleration of or entitle any party to
accelerate (whether after the giving of notice or the lapse of time or both)
any
obligation under, or result in the creation or imposition of any lien, charge,
pledge, security interest or other encumbrance upon any part of the property
of
the Company pursuant to any provision of, any order, judgment, arbitration
award, injunction, decree, indenture, mortgage, lease, license, lien, or other
agreement or instrument to which Buyer is a party or by which it is bound,
and
(iii) violate or conflict with any provision of the by-laws or articles of
incorporation of Buyer as amended to the date of this Agreement.
4 Other
Covenants and Agreements.
4.1 Section
338 Elections.
If
requested by Buyer, Buyer and Seller shall join in an election to have the
provisions of Section 338(h)(10) of the Internal Revenue Code and similar
provisions of state law (“Section 338 Elections”) apply to the acquisition of
the Company. Buyer shall be responsible for, and control, the preparation and
filing of such election. The allocation of purchase price among the assets
of
the Company shall be made in accordance with Code Sections 338 and 1060 and
any
comparable provisions of state, local or foreign law, as appropriate. Seller
shall, unless it would be unreasonable to do so, accept Buyer’s determination of
such purchase price allocations and shall report, act, file in all respects
and
for all purposes consistent with such determination of Buyer. Seller shall
execute and deliver to Buyer such documents or forms (including Section 338
Forms, as defined below) as Buyer shall request or as are required by applicable
law for an effective 338(h)(10) Election. “Section 338 Forms” shall mean all
returns, documents, statements, and other forms that are required to be
submitted to any federal, state, county or other local taxing authority in
connection with a 338(h)(10) Election, including, without limitation, any
“statement of Section 338 election” and IRS Form 8023 (together with any
schedules or attachments thereto) that are required pursuant to the Internal
Revenue Code and the regulations promulgated pursuant thereto.
9
4.2 Indemnification
by Seller.
Upon
the
terms and subject to the conditions set forth in Section 4.5 hereof, Seller
agrees 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, loss, damage (including incidental and consequential damages), cost
or
expense (including reasonable attorney's fees and reasonable costs of
investigation incurred in defending against such payment, loss, damage, cost
or
expense or claim therefor) made or incurred by or asserted against Buyer or
the
Company at any time after the Closing Date in respect of any omission,
misrepresentation, breach of warranty, or nonfulfillment of any term, provision,
covenant or agreement on the part of Seller contained in this Agreement, or
from
any misrepresentation in, or omission from, any certificate or other instrument
furnished or to be furnished to Buyer pursuant to this Agreement.
4.3 Indemnification
by Buyer.
Upon
the
terms and subject to the conditions set forth in Section 4.5 hereof, Buyer
agrees to indemnify and hold Seller harmless against, and will reimburse Seller
on demand for, any payment, loss, damage (including incidental and consequential
damages), cost or expense (including reasonable attorney's fees and reasonable
costs of investigation incurred in defending against such payment, loss, damage,
cost or expense or claim therefor) made or incurred by or asserted against
Seller at any time after the Closing Date in respect of any omission,
misrepresentation, breach of warranty, or nonfulfillment of any term, provision,
covenant or agreement on the part of Buyer contained in this Agreement, or
from
any misrepresentation in, or omission from, any certificate or other instrument
furnished or to be furnished to Seller pursuant to this Agreement.
4.4 Tax
Indemnity.
Upon
the
terms and subject to the conditions set forth in Section 4.5 hereof, Seller
agrees to indemnify and hold Buyer and the Company harmless against, and will
reimburse Buyer (or the Company if Buyer so requests) on demand
for:
(A) any
and
all tax deficiencies in respect of federal, state, local and foreign sales,
use,
income or franchise tax or taxes based on or measured by income, including
any
interest or penalties thereon and legal fees and expenses incurred by Buyer
and
the Company with respect to the taxable year ended December 31, 2005, and all
prior taxable years; and
(B) any
and
all such taxes, interest, penalties and legal fees and expenses in respect
of
the period from January 1, 2005 up to and including the Closing Date, but only
to the extent that such deficiencies, taxes, interest, penalties and legal
fees
and expenses exceed, in the aggregate, the amount of the aggregate reserves
for
such taxes, if any, shown as liabilities on the Closing Balance
Sheet.
The
indemnity provided for in this Section 4.4 shall be independent of and in
addition to any other indemnity provision of this Agreement and, anything in
this Agreement to the contrary notwithstanding [including Section 4.5(B)(ii)
hereof], shall survive indefinitely.
10
4.5 Conditions
of Indemnification.
With
respect to any actual or potential claim, any written demand, the commencement
of any action, or the occurrence of any other event which involves any matter
or
related series of matters (a "Claim") against which a party hereto is due to
be
indemnified (the "Indemnified Party") by the other party (the "Indemnifying
Party") under Sections 4.2, 4.3 or 4.4 hereof:
(A) Promptly
(and in no event no more than 30 days) after (i) Seller (if Seller is the
Indemnified Party), or (ii) the President of the Buyer or the Company (if Buyer
or the Company is the Indemnified Party) first receives written documents
pertaining to the Claim, or if such Claim does not involve a third party Claim
(a "Third Party Claim"), promptly (and in no event no more than 30 days) after
(i) Seller (if Seller is the Indemnified Party), or (ii) the President of the
Buyer or the Company (if Buyer or the Company is the Indemnified Party) first
has actual knowledge of such Claim, the Indemnified Party shall give notice
to
the Indemnifying Party of such Claim in reasonable detail and stating the amount
involved, if known, together with copies of any such written
documents.
(B) The
Indemnifying Party shall have no obligation to indemnify the Indemnified Party
with respect to any Claim if the Indemnified Party fails to give the notice
with
respect thereto in accordance with Section 4.5(A) hereof.
(C) If
the Claim involves a Third Party Claim, then the Indemnifying Party shall
have
the right, at its sole cost, expense and ultimate liability regardless of
the
outcome, and through counsel of its choice (which counsel shall be reasonably
satisfactory to the Indemnified Party), to litigate, defend, settle or otherwise
attempt to resolve such Third Party Claim; provided, however, that if in
the
Indemnified Party's reasonable judgment a conflict of interest may exist
between
the Indemnified Party and the Indemnifying Party with respect to such Third
Party Claim, then the Indemnified Party shall be entitled to select counsel
of
its own choosing, reasonably satisfactory to the Indemnifying Party, in
which event the Indemnifying Party shall be obligated to pay the fees and
expenses of such counsel. Notwithstanding the preceding sentence, the
Indemnified Party may elect, at any time and at the Indemnified Party's sole
cost, expense and ultimate liability, regardless of the outcome, and through
counsel of its choice, to litigate, defend, settle or otherwise attempt to
resolve such Third Party Claim. If the Indemnified Party so elects (for reasons
other than the Indemnifying Party's failure or refusal to provide a defense
to
such Third Party Claim), then the Indemnifying Party shall have no obligation
to
indemnify the Indemnified Party with respect to such Third Party Claim, but
such
disposition will be without prejudice to any other right the Indemnified
Party
may have to indemnification under Section 4.2, 4.3 or 4.4 hereof, regardless
of
the outcome of such Third Party Claim. If the Indemnifying Party fails or
refuses to provide a defense to any Third Party Claim, then the Indemnified
Party shall have the right to undertake the defense, compromise or settlement
of
such Third Party Claim, through counsel of its choice, on behalf of and for
the
account and at the risk of the Indemnifying Party, and the Indemnifying Party
shall be obligated to pay the costs, expenses and attorney's fees incurred
by
the Indemnified Party in connection with such Third Party Claim. In any event,
Buyer, the Company and Seller shall fully cooperate with each other and their
respective counsel in connection with any such litigation, defense, settlement
or other attempted resolution.
11
4.6 Taxes
and Expenses.
(A) Seller
hereby covenants and agrees to assume and pay all taxes arising from or relating
to the transactions as contemplated by this Agreement. Except as otherwise
specifically provided for in this Agreement, Seller shall be individually
responsible for and shall personally pay all costs, liabilities and other
obligations incurred by Seller in connection with the performance of and
compliance with all transactions, agreements and conditions contained in this
Agreement to be performed or complied with by Seller, including legal and
accounting fees. In no event shall any of such taxes, costs, liabilities or
other obligations be paid by or incurred on behalf of the Company.
(B) Except
as
otherwise specifically provided for in this Agreement, Buyer will assume and
pay
all costs, liabilities and other obligations incurred by Buyer in connection
with the performance of and compliance with all transactions, agreements and
conditions contained in this Agreement to be performed or complied with by
Buyer, including legal and accounting fees.
4.7 Company
Cooperation.
Subject
to the terms and conditions of this Agreement, Seller will use his best efforts
to cause the Company, its officers, directors, employees, accountants,
consultants, advisors and agents, to take, or cause to be taken, all actions
and
to do, or cause to be done, all things necessary, proper or advisable to
consummate the transactions contemplated by this Agreement.
4.8 Exclusive
Dealing.
(A) Prior
to
the termination of this Agreement, Seller shall not authorize or permit, and
shall not allow the Company or any officer, director or employee of, or any
investment banker, attorney or other advisor or representative of any of the
foregoing, to (i) solicit or initiate or encourage the submission of any
Acquisition Proposal (as herein defined) or (ii) participate in any discussions
or negotiations regarding, or furnish to any person any information with respect
to or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or may reasonable be expected to lead to any
Acquisition Proposal. For purposes of this Agreement, “Acquisition Proposal”
means any inquiry about or proposal for the acquisition to purchase of a
substantial amount of assets of the Company or any type of exchange offer or
other offer that if consummated would result in any person beneficially owning
any equity securities of the Company, or any merger, consolidation, business
combination, sale of any material assets, recapitalization, liquidation,
dissolution or similar transaction involving the Company (or equity securities
thereof) other than transactions contemplated by this Agreement, or any other
transaction the consummation of which would reasonable be expected to impede,
interfere with, prevent or materially delay the transaction contemplated by
this
Agreement, or which would reasonably be expected to dilute materially the
benefits to Buyer of the transaction contemplated by this
Agreement.
(B) During
the term of this Agreement, Seller shall not, nor permit the Company to, (i)
approve or recommend, consider or evaluate or cause to be considered or
evaluated, any Acquisition Proposal or (ii) enter into any agreement or
understanding with respect to any Acquisition Proposal. Seller acknowledges
and
agrees that he is not required or obligated in order to comply with any
fiduciary or other duty to review, consider or take any action with respect
to
any Acquisition Proposal (including, without limitation, any action prohibited
by this Section) during the term of this Agreement.
12
4.9 Public
Announcements.
Neither
Seller nor Buyer will at any time, without the prior written consent of the
other, make any announcement, issue any press release or make any statement
with
respect to this Agreement or any of the terms or conditions hereof except as
may
be necessary to comply with any law, regulation or order and then only after
written notice to the other party of the timing, context and content of such
announcement, press release or statement; provided, however, that subsequent
to
the Closing Buyer may disclose the consummation of the transaction herein
contemplated without the consent of the Seller.
4.10 Buyer’s
Right of Offset.
Subject
to the terms and conditions set forth in Section 4.5, in the event that Seller
fails to make any payment for indemnification as required of Seller under
Section 4.2 or Section 4.4 within ten days following Buyer’s written notice of
demand for payment, Buyer shall be entitled to offset the amount of such payment
against amounts owing under the Promissory Note.
5 Conditions
of Closing.
5.1 Buyer’s
Conditions of Closing.
The
obligation of Buyer to purchase and pay for the Company Interest shall be
subject to and conditioned upon the satisfaction (or waiver by Buyer) at the
Closing of each of the following conditions:
(A) All
representations and warranties of Seller contained in this Agreement and the
Schedules hereto shall be true and correct at and as of the Closing Date, Seller
shall have performed all agreements and covenants and satisfied all conditions
on its part to be performed or satisfied by the Closing Date pursuant to the
terms of this Agreement, and Buyer shall have received a certificate of the
Seller dated the Closing Date to such effect.
(B) There
shall have been no material adverse change since the date of the Unaudited
Balance Sheet in the financial condition, business or affairs of the Company,
and the Company shall not have suffered any material loss (whether or not
insured) by reason of physical damage caused by fire, earthquake, accident
or
other calamity which materially affects the value of its assets, properties
or
business, and Buyer shall have received a certificate of the Seller dated the
Closing Date to such effect.
(C) Seller
shall have delivered to Buyer a Certificate of the Secretary of State (or other
authorized officer) of the Company's jurisdiction of incorporation certifying
as
of a date reasonably close to the Closing Date that the Company has filed all
required reports, paid all required fees and taxes, and is, as of such date,
in
good standing and authorized to transact business as a domestic
corporation.
(D) Seller
shall have delivered the written resignations, effective on the Closing Date,
of
all members of the Managing Directors and all officers of the
Company.
13
(E) Seller
shall have delivered to Buyer certificates and other instruments representing
all Company Interest, duly endorsed for transfer or accompanied by appropriate
stock powers (in either case executed in blank or in favor of Buyer with the
execution thereof guaranteed by a bank or trust company), together with all
other documents necessary or appropriate to validly transfer the Company
Interest to Buyer free and clear of all security interests, liens, encumbrances
and adverse claims.
(F) Buyer
shall have received from Jackson, Barlow, Garsek, & Simon, LLP, Att: Xxxxx
Xxxxx counsel for Seller, an opinion, dated the Closing Date, in form and
substance satisfactory to Buyer and its counsel.
(G)
Pritchett, Siler, & Hardy, Certified Public Accountants, shall have
furnished to Buyer a letter, dated the Closing Date, confirming that they are
independent certified public accountants with respect to the Company and stating
in substance that, although they have not conducted an audit or a review of
any
financial statements of the Company and therefore are unable to and do not
express any opinion on the financial position, results of operations, or cash
flows of the Company, on the basis of a compilation of the balance sheet and
the
income statement of the Company as of December 31, 2005 (the “Compiled Balance
Sheet and Income Statement”) and a reading of the minutes of the meetings of the
stockholders and the Board of Directors of the Company from inception through
June 30, 2006, consultations with officers of the Company responsible for
financial and accounting matters on behalf of the Company, but without
conducting a compilation, review, or audit of any financial statements
subsequent to December 31, 2005 and based solely upon representations of
management of the Company, nothing has come to their attention which in their
judgment would indicate that: (i) their report on the December 31, 2005 Compiled
Balance Sheet and Income Statement was not prepared in accordance with
applicable AICPA standards; and (ii) during the period from the date of the
Compiled Balance Sheet to the date of the letter, there has been any material
change in the capital stock or long-term debt of the Company.
(H) Neither
any investigation of the Company by Buyer, nor the Schedules attached hereto
or
any supplement thereto nor any other document delivered to Buyer as contemplated
by this Agreement, shall have revealed any facts or circumstances which, in
the
sole and exclusive judgment of Buyer and regardless of the cause thereof,
reflect in an adverse way on the Company or its financial condition, assets,
liabilities (absolute, accrued, contingent or otherwise), reserves, business,
operations or prospects.
(I)
Buyer
understands that it will not have a seat on the Board of Directors for a period
of six months or until the next election or annual meeting of Compnay.
(J) The
approval and all consents from third parties and governmental agencies required
to consummate the transactions contemplated hereby shall have been
obtained.
(K) No
suit,
action, investigation, inquiry or other proceeding by any governmental body
or
other person or legal or administrative proceeding shall have been instituted
or
threatened which questions the validity or legality of the transactions
contemplated hereby.
14
(L) As
of the
Closing, there shall be no effective injunction, writ, preliminary restraining
order or any order of any nature issued by a court of competent jurisdiction
directing that the transactions provided for herein or any of them not be
consummated as so provided or imposing any conditions on the consummation of
the
transactions contemplated hereby, which is unduly burdensome on
Buyer.
5.2 Seller’s
Conditions of Closing.
The
obligation of Seller to sell the Company Interest shall be subject to and
conditioned upon the satisfaction (or waiver by Seller) at the Closing of each
of the following conditions:
(A) All
representations and warranties of Buyer contained in this Agreement shall be
true and correct at and as of the Closing Date and Buyer shall have performed
all agreements and covenants and satisfied all conditions on its part to the
performed or satisfied by the Closing Date pursuant to the terms of this
Agreement, and Seller shall have received a certificate of Buyer dated the
Closing Date to such effect.
(B) Buyer
shall have effected payment of the Purchase Price in accordance with Section
1.3
of this Agreement (i.e., the wire transfer of funds).
(C) Buyer
shall have delivered to Seller a Certificate of its corporate Secretary
certifying:
(1) Resolutions
of its Board of Directors authorizing execution of this Agreement and the
execution, performance and delivery of all agreements, documents and
transactions contemplated hereby; and
(2) The
incumbency of its officers executing this Agreement and all agreements and
documents contemplated hereby.
(D) Seller
shall have received from The X’Xxxx Law Firm (Xxxxxxx X’Xxxx), counsel for
Buyer, an opinion, dated the Closing Date, in form and substance satisfactory
to
Seller and its counsel.
(E) The
approval and all consents from third parties and governmental agencies required
to consummate the transactions contemplated hereby shall have been
obtained.
(F) No
suit,
action, investigation, inquiry or other proceeding by any governmental body
or
other person or legal or administrative proceeding shall have been instituted
or
threatened which questions the validity or legality of the transactions
contemplated hereby.
(G) As
of the
Closing, there shall be no effective injunction, writ, preliminary restraining
order or any order of any nature issued by a court of competent jurisdiction
directing that the transactions provided for herein or any of them not be
consummated as so provided or imposing any conditions on the consummation of
the
transactions contemplated hereby, which is unduly burdensome on
Seller.
15
6 Termination.
6.1
Methods
of Termination.
The
transactions contemplated herein may be terminated and/or abandoned at any
time
before or after approval thereof by Seller and Buyer, but not later than the
Closing:
6.1.1 By
mutual
consent of Buyer and Seller; or
6.1.2 By
Buyer,
if any of the conditions provided for in Section 5.1 hereof shall not have
been
met or waived in writing by Buyer at or prior to Closing; or
6.1.3 By
Seller, if any of the conditions provided for in Section 5.2 hereof shall not
have been met or waived in writing by Seller at or prior to
Closing.
6.2 Procedure
Upon Termination.
In
the
event of termination by Buyer or Seller, as applicable, pursuant to Section
6.1
hereof, written notice thereof shall forthwith be given to the other party
and
the transactions contemplated by this Agreement shall be terminated without
further action by Buyer or Seller. If the transactions contemplated by this
Agreement are so terminated:
6.2.1 Each
party will redeliver all documents, work papers and other material of any other
party relating to the transactions contemplated hereby, whether so obtained
before or after the execution of this Agreement, to the party furnishing the
same; and
6.2.2 No
party
hereto shall have any liability or further obligation to any other party to
this
Agreement except that if such termination is a result of the failure of any
condition set forth in (i) Sections 5.1(A) through 5.1(F) and 5.1(I) hereof,
then Buyer shall be entitled to recover from Seller all out-of-pocket costs
which Buyer has incurred (including reasonable attorney's fees, accounting
fees
and expenses); and (ii) Sections 5.2(A) through 5.2(D) hereof, then Seller
shall
be entitled to recover from Buyer all out-of-pocket costs which Seller has
incurred (including reasonable attorney's fees, accounting fees and
expenses).
16
7 Miscellaneous.
7.1 Notice.
Any
notice required or permitted hereunder shall be in writing and shall be
sufficiently given if personally delivered or mailed by certified or registered
mail, return receipt requested, addressed as follows:
| If to Buyer: |
Xxxxxxx
X. Xxxxxxx, Pres./CEO
Secured
Financial Network, Inc
000
XX 0xx
Xxx., Xxxxx 0000
Xx.
Xxxxxxxxxx, Xx 00000
|
||
|
Copy
to:
|
Wm. X’Xxxx, Esq.
00000
X. Xxxx Xxxx., Xxxxx 000X
Xxxxxxxxxxxxx,
XX 00000
|
||
| If to Seller: |
Xxxxx
Xxxxx
HEB,
LLC
0000
X. Xxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
|
||
| Copy to: | Barlow,
Garsek, & Simon
0000
Xxxxxx Xx.
Xx.
Xxxxx, XX 00000
Att:
Xxxxx Xxxxx
|
(or
to
such other address as any party shall specify by written notice so given),
and
shall be deemed to have been delivered as of the date so personally delivered
or
mailed.
7.2 Execution
of Additional Documents.
The
parties hereto will at any time, and from time to time after the Closing Date,
upon request of the other party, execute, acknowledge and deliver all such
further acts, deeds, assignments, transfers, conveyances, powers of attorney
and
assurances as may be reasonably required to carry out the intent of this
Agreement, and to transfer and vest title to any Company Interest being
transferred hereunder, and to protect the right, title and interest in and
enjoyment of all of the Company Interest sold, granted, assigned, transferred,
delivered and conveyed pursuant to this Agreement; provided, however, that
this
Agreement shall be effective regardless of whether any such additional documents
are executed.
7.3 Binding
Effect; Benefits.
This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective heirs, successors, executors, administrators and
assigns. Notwithstanding anything contained in this Agreement to the contrary,
nothing in this Agreement, expressed or implied, is intended to confer on any
person other than the parties hereto or their respective heirs, successors,
executors, administrators and assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
17
7.4 Entire
Agreement.
This
Agreement, together with the Exhibits, Schedules and other documents
contemplated hereby, constitute the final written expression of all of the
agreements between the parties, and is a complete and exclusive statement of
those terms. It supersedes all understandings and negotiations concerning the
matters specified herein. Any representations, promises, warranties or
statements made by either party that differ in any way from the terms of this
written Agreement and the Exhibits, Schedules and other documents contemplated
hereby, shall be given no force or effect. The parties specifically represent,
each to the other, that there are no additional or supplemental agreements
between them related in any way to the matters herein contained unless
specifically included or referred to herein. No addition to or modification
of
any provision of this Agreement shall be binding upon any party unless made
in
writing and signed by all parties.
7.5 Governing Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Nevada exclusive of the conflict of law provisions
thereof.
7.6 Survival.
All
of
the terms, conditions, warranties and representations contained in this
Agreement shall survive the Closing.
7.7 Counterparts.
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.
7.8 Headings.
Headings
of the Articles and Sections of this Agreement are for the convenience of the
parties only, and shall be given no substantive or interpretive effect
whatsoever.
7.9 Waivers.
Either
Buyer or Seller may, by written notice to the other, (i) extend the time for
the
performance of any of the obligations or other actions of the other under this
Agreement; (ii) waive any inaccuracies in the representations or warranties
of
the other contained in this Agreement or in any document delivered pursuant
to
this Agreement; (iii) waive compliance with any of the conditions or covenants
of the other contained in this Agreement; or (iv) waive performance of any
of
the obligations of the other under this Agreement. Except as provided in the
preceding sentence, no action taken pursuant to this Agreement, including
without limitation any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action of compliance
with
any representations, warranties, covenants or agreements contained in this
Agreement. The waiver by any party hereto of a breach of any provision hereunder
shall not operate or be construed as a waiver of any prior or subsequent breach
of the same or any other provision hereunder.
7.10
Merger
of Documents.
This
Agreement and all agreements and documents contemplated hereby constitute one
agreement and are interdependent upon each other in all respects.
7.11 Incorporation
of Exhibits and Schedules.
All
Exhibits and Schedules attached hereto are by this reference incorporated herein
and made a part hereof for all purposes as if fully set forth
herein.
18
7.12 Severability.
If
for
any reason whatsoever, any one or more of the provisions of this Agreement
shall
be held or deemed to be inoperative, unenforceable or invalid as applied to
any
particular case or in all cases, such circumstances shall not have the effect
of
rendering such provision invalid in any other case or of rendering any of the
other provisions of this Agreement inoperative, unenforceable or
invalid.
7.13 Assignability.
Neither
this Agreement nor any of the parties' rights hereunder shall be assignable
by
any party hereto without the prior written consent of the other parties
hereto.
[THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
19
IN
WITNESS WHEREOF,
the
parties have executed this Agreement and caused the same to be duly delivered
on
their behalf on the day and year first above written.
SELLER:
Virtual
Payment Solutions, LLC
/s/
Xxxxx
Xxxxx
Xxxxx
Xxxxx, Managing Director
BUYER:
By:
/s/ Xxxxxxx Xxxxxxx
Xxxxxxx
Xxxxxxx,
Its:
President and CEO
\\Meyers1\company\WDO'Xxxx\Xxxx
Xxxxxxxx\Stock Purchase Agt.wpd
20
EXHIBIT
A
FORM
OF
PROMISSORY NOTE
21
EXHIBIT
B
FORM
OF
EMPLOYMENT CONTRACT
22
SCHEDULE
2.8
JURISDICTIONS
WHERE COMPANY IS LICENSED TO DO BUSINESS
UNITED
STATES
NEVIS
ISLE
OF
MAN
23
SCHEDULE
2.10
OFFICERS
AND DIRECTORS OF COMPANY
XXXXX
XXXXX, MANAGING DIRECTOR
24
SCHEDULE
2.12
UNDISCLOSED
LIABILITIES
NONE
25
SCHEDULE
2.18
REAL
PROPERTY OWNED/LEASED BY COMPANY
NONE
26
SCHEDULE
2.19
LIST
OF
CONTRACTS AND OTHER DATA
27
SCHEDULE
2.23
PENDING
LITIGATION
NONE
28
SCHEDULE
2.24
BANK
ACCOUNTS
29
SCHEDULE
2.26
INSURANCE
POLICIES
