EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT is made and entered into this 10th day
of February, 2003, by and between Cognigen Networks, Inc. ("Seller") and Xxxxx
Xxxxx and Xxxxx Gorlovezsky (collectively, "Purchaser").
RECITALS
A. Seller is the holder of 4,530,422 8% Series A Preferred Shares (the "AIC
Preference Shares"), 2,581,878 Investment Class Shares (the "AIC Investment
Shares"), and Warrants to purchase 650,000 Investment Class Shares (the "AIC
Warrants") of American Internet Communications, L.L.C., a Florida limited
liability Company (the "Corporation").
B. Seller desires to sell and Purchaser desires to purchase all of Seller's
AIC Preference Shares, Investment Class Shares and AIC Warrants (collectively
"AIC Securities").
NOW THEREFORE, in consideration of the premises and of the mutual covenants
and agreements contained herein, the parties hereto do hereby represent,
warrant, covenant and agree as follows:
Article 1.
TERMS OF TRANSACTION
1.1. Purchase and Sale. Purchaser hereby agrees, subject to the terms and
conditions of this Agreement, to purchase from Seller, and Seller hereby agrees,
subject to the terms and conditions of this Agreement, to sell to Purchaser the
AIC Securities.
1.2. Purchase Price. The total consideration ("Purchase Price") to be paid
by Purchaser to Seller for the AIC Securities is $22,500, $5,000 of which is
hereby acknowledged as having been received by Seller and which Buyer
acknowledges is nonrefundable.
1.3. Securities Certificate. Upon receipt of the balance of $17,500 on or
before the Closing, Seller shall assign the AIC Securities to Buyer.
Article 2.
CLOSING
The AIC Securities transaction contemplated herein shall be consummated
(the "Closing") by Purchaser bank wire transferring $17,500 to Seller by March
5, 2007. All bank wire transfers shall be sent to the Bank of America, San Louis
Obispo, California, ABA routing number ************ for credit to account number
********** or whichever account the Seller hereafter may designate in writing,
in the name of Cognigen Networks, Inc. Upon receipt of the wire transfer by such
date, Seller shall assign and send the AIC Securities to Purchaser by overnight
delivery service to 0000 X.X. 000xx Xxxxxx, Xxxxx 000, Xxxxx Xxxxx Xxxxx,
Xxxxxxx 00000. If the $17,500 is not received by Seller by 5:00 p.m. on March
__, 2003, this Securities Purchase Agreement shall terminate and Seller shall
retain the $5,000 set forth above.
Article 3.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
As an inducement to Seller to enter into this Agreement and to consummate
the transactions contemplated hereby, Purchaser represents and warrants to
Seller and to the Corporation as follows:
3.1. Authority. Purchaser has full power and authority to make, execute and
perform this Agreement and the transactions contemplated hereby. This Agreement
is a valid and binding obligation of Purchaser enforceable in accordance with
its terms.
3.2. No Default Resulting From Agreement. Neither the execution and
delivery of this Agreement nor the performance of its terms by Purchaser will
result in any material breach of the terms and conditions of, or constitute a
default under, any material agreement, lease, mortgage, note, instrument,
undertaking, judgment, decree, governmental order or other restriction or
obligation to which Purchaser is a party which prohibits Purchaser's ability to
perform its obligations pursuant to this Agreement.
3.3. Required Consents and Approvals. No application, notice, order,
registration, qualification, waiver, consent, approval, or other action is
required to be filed, given, obtained, or taken by Purchaser by virtue of the
execution, delivery, and performance of this Agreement or the consummation of
the transactions contemplated hereby.
3.4. Brokerage. No third party shall be entitled to receive any brokerage
commissions, finder's fees, fees for financial advisory services or similar
compensation in connection with the transactions contemplated by the Agreement
based on any arrangement or agreement made by or on behalf of Purchaser.
3.5. Investment Intent. Purchaser is purchasing the AIC Securities for
Purchaser's own account with the present intention of holding the AIC Securities
for investment purposes and not with a view to or for sale in connection with
any distribution of the AIC Securities in violation of any applicable securities
law. Buyer will refrain from transferring or otherwise disposing of any of the
AIC Securities, or any interest therein, in such manner as to cause Seller to be
in violation of the registration requirements of the Securities Act of 1933, as
amended ("Act"), or applicable state securities or blue sky laws.
3.6. Financial Position. Purchaser is in a financial position to hold the
AIC Securities for an indefinite period of time and is able to bear the economic
risk and withstand a complete loss of Purchaser's investment in the AIC
Securities.
3.7. Investment Experience. Purchaser believes Purchaser, either alone or
with the assistance of Purchaser's professional advisor, has such knowledge and
experience in financial and business matters that Purchaser is capable of
evaluating the merits and risks of the prospective investment in the AIC
Securities. Purchaser has obtained, to the extent Purchaser deems necessary,
Purchaser's own personal professional advice with respect to assessing the risks
inherent in an investment in the AIC Securities, and the suitability of an
investment in the AIC Securities in light of Purchaser's financial condition and
investment needs.
3.8. Access to Information. Because of Purchaser's relationship with the
Corporation, Purchaser has full and complete information regarding the
Corporation.
3.9. AIC Securities not Transferable. Purchaser realizes that (i) the AIC
Securities have not been registered under the Act or any applicable state
securities laws and, therefore, cannot be sold unless they are subsequently
registered under such securities laws or exemptions from such registration are
available, (ii) there is presently no public market for the AIC Securities, and
Purchaser may not be able to liquidate Purchaser's investment in the event of an
emergency or pledge the AIC Securities as collateral security for loans, and
(iii) the transferability of the AIC Securities is restricted by a legend placed
on the certificates evidencing the AIC Securities.
Article 4.
REPRESENTATIONS AND WARRANTIES OF SELLER
As an inducement to Purchaser to enter into this Agreement and to
consummate the transactions contemplated hereby, Seller represents and warrants
to Purchaser as follows:
4.1. Authority. Seller has full power and authority to make, execute and
perform this Agreement and the transactions contemplated hereby and the
execution, delivery and performance of this Agreement and that this Agreement
has been duly and validly executed and delivered by Seller and is a valid and
binding obligation of Seller enforceable in accordance with its terms.
4.2. Title. When issued, sold, transferred and delivered to Purchaser upon
payment of the Purchase Price therefor, the AIC Securities will be fully paid
and non-assessable, free and clear of all mortgages, pledges, liens, security
interests, conditional sale agreements, charges, encumbrances and restrictions
of every nature.
4.3. Access to Information. Seller has been given access to full and
complete information regarding the Corporation and has utilized such access to
Seller's satisfaction. Seller has either attended or been given reasonable
opportunity to attend a meeting with representatives of the Corporation for the
purpose of asking questions of, and receiving answers from, such representatives
concerning the terms and conditions of the offering of the AIC Securities and to
obtain any additional information, to the extent reasonably available, necessary
to verify the accuracy of information regarding the Corporation.
Article 5.
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER
All of the obligations of Seller under this Agreement are subject to the
fulfillment prior to or at the Closing of each of the following conditions, any
one or more of which may be waived in writing by Seller:
5.1. Accuracy of Representations and Warranties. The representations and
warranties of Purchaser contained herein or in any certificate, schedule, or
other document delivered by Purchaser pursuant to the provisions hereof, or in
connection herewith, shall be true and correct in all material respects as of
the Closing with the same effect as though such representations and warranties
had been made at the Closing, except to the extent such representations and
warranties expressly relate only to an earlier date, and except for changes
contemplated by this Agreement or approved in writing by Seller.
5.2. Compliance With Conditions. Purchaser shall have performed and
complied with all agreements and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing.
5.3. Purchase Price. Purchaser shall have delivered to Seller the Purchase
Price.
Article 6.
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF PURCHASER
All of the obligations of Purchaser under this Agreement are subject to the
fulfillment prior to or at the Closing of each of the following conditions, any
one or more of which may he waived in writing by Purchaser:
6.1. Accuracy of Representations and Warranties. The representations and
warranties of Seller contained herein shall be true and correct in all material
respects as of the Closing with the same effect as though such representations
and warranties had been made at the Closing, except to the extent such
representations and warranties expressly relate only to an earlier date, and
except for changes contemplated by this Agreement or approved in writing by
Seller.
6.2. Compliance With Conditions. Seller shall have performed and complied
with all agreements and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing.
Article 7.
MISCELLANEOUS
7.1. Notices. Except as provided in Article 2, all notices, requests,
demands and other communications required or permitted hereunder shall be in
writing and shall be deemed to have been duly given if delivered or mailed,
first class, certified mail, postage prepaid, return receipt requested:
a. To Purchaser at:
Xxxxx Xxxxx
0000 X.X. 000xx Xxxxxx, Xxxxx 000
Xxxxx, XX 00000
Xxxxx Gorlovezsky
0000 X.X. 000xx Xxxxxx, Xxxxx 000
Xxxxx, XX 00000
b. To Seller at:
Cognigen Networks, Inc.
0000 Xxxxxxx Xxx., X.X., #000
Xxxxxxx, XX 00000
Attn.: Xxxxxxx X. Xxxxxx
7.2. Entire Agreement. This Agreement supersedes all prior discussions and
agreements between Purchaser and Seller with respect to the matters contained
herein and this Agreement constitutes the sole and entire agreement between the
parties hereto with respect to the subject matter hereof
7.3. Amendments and Waivers. This Agreement may be amended only by an
instrument in writing executed by the party against whom enforcement of the
amendment is sought. Seller and Purchaser may, by a signed writing, give any
consent, take any action, waive any inaccuracies in representations or other
compliance by the other party to any of the covenants or conditions herein,
modify the terms of this Agreement, or take any other action deemed by Seller or
Purchaser to be necessary or appropriate to consummate the transactions
contemplated by this Agreement.
7.4. Counterparts; Headings. 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. The headings herein set out are
for convenience of reference only and shall not be deemed a part of this
Agreement.
7.5. Binding Effect. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective heirs,
representatives, successors and assigns, but no party may assign, delegate or
otherwise transfer any of such party's rights, duties or obligations hereunder
or interest herein without the written consent of the other party hereto.
7.6. Further Assurances. After the Closing, each party, at the request of
the other party, shall execute, deliver and acknowledge where necessary from
time to time such other and further acts and things as may be reasonably
necessary to more fully and effectively consummate the transactions contemplated
by this Agreement.
7.7. Governing Law. The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of Colorado.
IN WITNESS WHEREOF, the parties have caused this Agreement to be made
effective on the day and year first above written.
PURCHASER:
/s/ Xxxxx Xxxxx
Xxxxx Xxxxx
/s/ Xxxxx Gorlovezsky
Xxxxx Gorlovezsky
SELLER:
COGNIGEN NETWORKS, INC.
By:/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, President
