CONTRIBUTION AGREEMENT
between
XXXXX X. XXXXXXX
as the Contributor
and
SAKER ONE CORPORATION
as the Contributee
Dated as of December 15, 1998
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (THIS "AGREEMENT"), dated as of December
15, 1998, is between XXXXX X. XXXXXXX, an individual and resident of the State
of Texas (THE "CONTRIBUTOR"), and SAKER ONE CORPORATION, a Utah Corporation
("CONTRIBUTEE").
RECITALS
A.Pursuant to an Acquisition Agreement dated as of December 15, 1998 (THE
"ACQUISITION AGREEMENT"), Contributee acquired all of the outstanding capital
stock of Triad Compressor, Inc., a Texas corporation ("TRIAD-TEXAS") in exchange
for shares of common stock of Contributee issued to the shareholders of
TRIAD-TEXAS (THE "SHAREHOLDERS").
B. Contributor is a Party to that certain License Agreement (the
"COMPRESSOR AGREEMENT"), dated as of March 13, 1996, by and between Triad-Texas
and Contributor, a copy of which is attached as Exhibit A.
C. The Acquisition Agreement contemplates that concurrently with the
contribution by the Shareholders of the stock of Triad-Texas, Contributor shall
enter into this Agreement with Contributee.
STATEMENT OF AGREEMENT
In consideration of the foregoing, the mutual representations,
warranties, covenants and agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Contributor and the Contributee hereby agree as follows:
ARTICLE I
THE TRANSACTION
1.1 ISSUANCE OF SHARES. Subject to the terms and conditions set forth herein,
the Contributee shall issue to the Contributor 1,350,000 shares of the
Contributee's common stock, par value $.01 per share (the "SHARES").
1.2 ROYALTY PAYMENTS.
(A) SEPARATION TECHNOLOGY. For the purpose of this Agreement,
"SEPARATION TECHNOLOGY" shall include, but not be limited to, (i) U.S.
Patent 5,902,224, and related U.S. patent filings (including, without
limitation, continuations, divisionals and continuations-in-part thereof),
and foreign counterpart patent filings to these, and the inventions more
fully described therein, (ii) the Mass-Mass Cell Centrifuge technology
described in Exhibit B to this Agreement, (iii) the Censa Rotor centrifuge
technology described in Exhibit C to this Agreement, (iv) the Compressor
technology described in Exhibit D to this Agreement, (v) all designs,
technical information, know-how, knowledge, data specifications, test
results, formulas, patent applications, drawings, prototypes and other
information which arise from or relate to the selective separation and
purification of gas components from a mixture thereof and (vi) all future
improvements, developments, derivative works or additions to any of the
aforementioned of any kind that may be developed directly or indirectly by
Contributee.
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(B) ROYALTY PAYMENT. Subject to the terms and conditions set forth
herein, the Contributee agrees to pay Contributor a royalty payment (the
"ROYALTY PAYMENT") equal to the greater of (a) 0.444% of gross receipts
derived from the use, benefit, licensing, transfer and sale of the
Separation Technology, or (b) a minimum royalty payment of $4,444 per year.
The right to receive royalty payments (the "ROYALTY") shall commence with
respect to gross receipts received by Contributee for the calendar year
ending December 31, 2000. For the purpose of this provision, gross receipts
shall be interpreted to include any and all revenue that may be derived in
connection with or relating to the use, benefit, licensing, transfer or
sale of the Separation Technology, regardless whether such revenue was
received in cash securities or other property. Royalty Payments shall be
due upon such gross receipts received for the life of the Separation
Technology. Contributor agrees that Royalty Payments shall attach to the
Separation Technology regardless of the entity that derives the benefit
from the Separation Technology, including, without limitation, continued
Royalty Payments under this Agreement as a condition for the sale, transfer
or conveyance of the Separation Technology to any third party.
(C) PAYMENT. At the election of the Contributor, Royalty Payments
shall be payable (i) in cash or (ii) in additional shares of common stock
of the Contributee. Royalty Payments shall be paid by Contributee to
Contributor within thirty (30) days after the conclusion of each calendar
quarter, provided, however, that royalties based on non-U.S. or non-cash
gross receipts may be paid within sixty (60) days after the conclusion of
the relevant quarter. Royalty Payments shall be accompanied by a detailed
accounting of the basis for such payment, identifying the source and amount
of applicable revenues so received.
(D) RIGHT TO AUDIT. Contributee shall, upon written request from
Contributor, during normal business hours, but not more frequently than
once each calendar year, provide access to pertinent records relating to
gross receipts received and Royalties Payments payable in connection with
the Separation Technology under this Agreement, to an independent
accounting firm chosen by Contributor for purposes of auditing the amount
of Royalty Payments due to Contributor during any calendar year.
Contributee shall be responsible for all expenses associated with such
audit. Upon receipt by Contributee of a request for an audit as provided
hereby, Contributee shall provide a copy of such request within 10 days
after receipt thereof to all Royalty holders entitled to Royalty Payments
with respect to the Separation Technology. The independent audit firm
selected to conduct such audit shall be designated by the holders of a
majority-in-interest (by Royalty percentage) of the Royalties within 30
days after receipt by such holders of notice of a request for audit.
Royalty holders who fail to designate an audit firm shall be deemed to
concur with the selection of an auditor made by the Royalty holder who
initiates an audit request. In no event shall Contributee be required to
conduct more than one audit per year on behalf of all royalty holders.
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1.3 ASSIGNMENT. Subject to the terms and conditions set forth herein, and as
full consideration for the issuance of the Shares by the Contributee to
Contributor, and the Royalty Payments to be paid hereunder, the Contributor
hereby grants, assigns, transfers, conveys, delivers and confirms unto
Contributee and its successors and assigns forever, all right, title and
interest in and to the Compressor Agreement, free and clear of all claims, liens
and encumbrances other than the right of Contributor to receive the Royalty
Payment pursuant to this Agreement. Contributee hereby accepts such assignment
and hereby assumes all duties and obligations of Contributor with respect to the
Compressor Agreement.
1.4 THE CLOSING.
(A) CLOSING OF TRANSACTIONS. The Closing of all transactions set forth
herein (the "CLOSING"), including all transfers, assignments and payments,
shall occur effective as of the date hereof at such place as the parties
may mutually agree. The date on which the Closing of all of the
transactions contemplated hereby occurs is herein referred to as the
"CLOSING DATE."
(B) DELIVERIES BY THE CONTRIBUTEE. At the Closing, the Contributee
shall deliver to the Contributor: (i) one or more stock certificates
representing the Shares, each registered in such names as the Contributor
shall designate, (ii) all other documents, instruments and writings
required to be delivered at or prior to the Closing by the Contributee in
order to complete the transactions contemplated by this Agreement.
(C) DELIVERIES BY THE CONTRIBUTOR. At the Closing, the Contributor
shall deliver to the Contributee all documents, instruments and writings
required to be executed and delivered at or prior to the Closing by the
Contributor in order to complete the transactions contemplated by this
Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTEE. The Contributee hereby
represents and warrants to the Contributor as of the date hereof:
(A) ORGANIZATION AND QUALIFICATION. The Contributee is a corporation,
duly organized, validly existing and in good standing under the laws of the
State of Utah, with the requisite corporate power and authority to own and
use its properties and assets and to carry on its business as currently
conducted. The Contributee is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not have a material adverse effect on the
business, assets or financial condition of the Contributee.
(B) AUTHORIZATION; ENFORCEMENT. The Contributee has the requisite
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Contributee and the consummation by it of the transactions contemplated
hereby and thereby has been duly authorized by all requisite corporate
action on the part of the Contributee. This Agreement has been duly
executed and delivered by the Contributee and constitutes the legal, valid
and binding obligation of the Contributee enforceable against the
Contributee in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws affecting creditors' rights or by
other equitable principles of general application. The execution, delivery
and performance of this Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby will not require
any notice to, filing with, or the consent, approval or authorization of
any person or governmental authority.
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(C) CAPITALIZATION. The authorized capital stock of the Contributee
consists of 25,000,000 shares of common stock, 14,600,000 shares of which
are issued and outstanding. No shares of any capital stock of the
Contributee are entitled to preemptive or similar rights, nor is any holder
entitled to preemptive or similar rights arising out of any agreement or
understanding with the Contributee. There are no outstanding options,
warrants, conversion rights, exchange rights, exercise rights, calls,
commitments or other rights of any character whatsoever giving any person
any right to subscribe for or acquire any capital stock of the Contributee,
or any contracts, commitments, understandings, or arrangements by which the
Contributee is or may become bound to issue additional shares of its
capital stock.
(D) ISSUANCE OF SHARES. The Shares have been duly authorized, and when
issued and paid for in accordance with the terms hereof, shall be validly
issued, fully paid and nonassessable.
(E) NO CONFLICTS. The execution, delivery and performance of this
Agreement and the Royalty Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby and thereby do
not and will not: (i) conflict with or violate any provision of the
Contributee's charter documents or bylaws; (ii) conflict with, constitute a
default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Contributee is a party or by which any asset of the
Contributee is bound or affected; or (iii) result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Contributee
is subject (including federal and state securities laws and regulations),
or by which any asset of the Contributee is bound or affected.
(F) PRIVATE OFFERING. The offer and sale of the Shares are exempt from
registration under Section 5 of The Securities Act of 1933, as amended (the
"SECURITIES ACT"). Neither the Contributee nor any person acting on its
behalf has taken or will take any action which might subject the offering,
issuance or sale of the Shares to the registration requirements of Section
5 of the Securities Act.
2.2 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR. The Contributor hereby
represents and warrants to the Contributee as of the date hereof:
(A) POWER AND AUTHORITY. The Contributor is an individual residing in
the State of Minnesota. The Contributor has the requisite competence and
authority to execute and deliver the Agreement, to perform his obligations
hereunder and to consummate the transactions contemplated hereby.
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(B) ENFORCEMENT. This Agreement has been duly executed and delivered
by the Contributor and constitutes the legal, valid and binding obligation
of the Contributor enforceable against the Contributor in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws affecting creditors' rights or by other equitable principles of
general application. The execution, delivery and performance of this
Agreement by the Contributor and the consummation by the Contributor of the
transactions contemplated hereby will not require any notice to, filing
with, or the consent, approval or authorization of any person or
governmental authority.
(C) INVESTMENT INTENT. The Contributor is acquiring the Shares for
Contributor's own account for investment purposes only and not with a view
to or for distributing or reselling the Shares or any part thereof or
interest therein, without prejudice, however, to the Contributor's right at
all times to sell or otherwise dispose of all or any part of the Shares
pursuant to an effective registration statement under the Securities Act
and in compliance with applicable state securities laws, or under an
exemption from such registration.
(D) ACCESS TO INFORMATION. The Contributor acknowledges that
Contributor has been afforded: (i) the opportunity to ask such questions as
he deemed necessary of, and to receive answers from, representatives of the
Contributee concerning the terms and conditions of the offering of the
Shares, and the merits and risks of investing in the Shares; (ii) access to
information about the Contributee and the Contributee's financial
condition, results of operations, business, properties, management and
prospects sufficient to enable him to evaluate his investment; and (iii)
the opportunity to obtain such additional information which the Contributee
possesses or can acquire without unreasonable effort or expense that the
Contributor believes is necessary to make an informed investment decision
with respect to the Shares.
(E) NO VIOLATIONS; CONFLICTS. The execution, delivery and performance
of this Agreement by the Contributor and the consummation by the
Contributor of the transactions contemplated hereby do not and will not:
(i) conflict with, constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Contributor is a party or
by which any property of the Contributor is bound or affected; or (ii)
result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental
authority to which the Contributor is subject (including federal and state
securities laws and regulations), or by which any asset of the Contributor
is bound or affected. The Contributor has not granted, assigned,
transferred or conveyed any right, title or interest whatsoever in or to
the Separation Technology to any person or entity other than the
Contributee, and no lien exists on, in or against the Separation
Technology.
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ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 TRANSFER RESTRICTIONS.
(A) REGISTRATION REQUIREMENTS. If the Contributor decides to dispose
of any of the Shares held by Contributor, the Contributor understands and
agrees that he may do so only pursuant to an effective registration
statement under the Securities Act or pursuant to an available exemption
from the registration requirements of the Securities Act.
(B) LEGEND. The Contributor agrees to the imprinting of the following
legend on the certificates representing the Shares:
THE ISSUANCE OF THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
ARTICLE IV
INDEMNIFICATION AND DAMAGES
4.1 INDEMNIFICATION BY CONTRIBUTEE. The Contributee shall indemnify, defend, and
hold the Contributor and its successors and assigns harmless from any and all
claims, losses, liabilities and damages, including, without limitation, amounts
paid in settlement, reasonable costs of investigation and reasonable fees and
disbursements of counsel, directly or indirectly related or arising with respect
to (i) any inaccuracy in any representation or warranty of the Contributee under
this Agreement; or (ii) any failure to perform or observe any covenant or
agreement to be performed by the Contributee set forth in this Agreement or any
document delivered to the Contributor pursuant to this Agreement.
4.2 INDEMNIFICATION BY CONTRIBUTOR. The Contributor shall indemnify, defend, and
hold the Contributee and its successors and assigns harmless from and against
any and all claims, losses, liabilities and damages, including, without
limitation, amounts paid in settlement, reasonable costs of investigation and
reasonable fees and disbursements of counsel, directly or indirectly related or
arising with respect to (i) any inaccuracy in any representation or warranty of
the Contributor under this Agreement; or (ii) any failure to perform or observe
any covenant or agreement to be performed by the Contributor set forth in this
Agreement or any document delivered to the Contributee pursuant to this
Agreement.
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ARTICLE V
MISCELLANEOUS
5.1 FEES AND EXPENSES. The Contributee shall pay the fees and expenses of both
the Contributee and the Contributor incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. In connection therewith,
the Contributee shall promptly reimburse the Contributor for any such fees and
expenses that Contributor has incurred, including the fees and expenses of the
Contributor's legal counsel. The Contributee shall pay all stamp and other taxes
and duties levied in connection with the issuance of the Securities pursuant
hereto.
5.2 ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.
5.3 NOTICES. Any notice or other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed to
the address listed below:
If to the Contributee:
SAKER ONE CORPORATION
Xxxxx Building
000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxx
If to the Contributor:
Xxxxx X. XxXxxxx
000 Xxxxxxxx
Xxxxxxx, XX 00000
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
5.4 AMENDMENTS; WAIVERS. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by both the
Contributee and the Contributor; or in the case of a waiver, by the party
against whom enforcement of any such waiver is sought. No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
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5.5 HEADINGS. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
5.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.
5.7 GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Texas without
regard to the principles of conflicts of law thereof.
5.8 SURVIVAL. The agreements, covenants, and representations and warranties
contained in this Agreement shall survive the Closing.
5.9 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the executing party with the same force and effect as if such
facsimile signature page were an original thereof.
5.10 SEVERABILITY. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
5.11 FURTHER ASSURANCES. Each party to this Agreement agrees to execute such
documents or instruments, and to take such action, as the other party may
reasonably request after the Closing Date in order to effectuate and perfect the
transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
CONTRIBUTOR
_______________________________
Xxxxx X. XxXxxxx
CONTRIBUTEE
SAKER ONE CORPORATION, a Utah corporation
By:____________________________
Name:__________________________
Title:_________________________
DISCLAIMER OF RIGHTS
Trinity Research, Inc., a Minnesota corporation and Xxxxxxx X. Xxxxx hereby
acknowledge and confirm that neither of such parties have any rights to the
Compressor Agreement or the technology that is the subject thereof, having
heretofore transferred all rights to such technology to Triad Compressor, Inc.,
a Texas corporation.
TRINITY RESEARCH, INC.
By:___________________________
Name:_________________________
Title:________________________
______________________________
XXXXXXX X. XXXXX
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CONSENT TO TRANSFER AND ASSIGNMENT
Triad Compressor, Inc., a Texas corporation hereby consents to the assignment by
Contributor to Contributee of Contributor's right, title and interest in and to
the compressor agreement as described above.
TRIAD COMPRESSOR, INC.
By:___________________________
Name:_________________________
Title:________________________
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CONTRIBUTION AGREEMENT
between
THE XXXXX XXXXXX GROUP I, LTD.
as the Contributor
and
SAKER ONE CORPORATION
as the Contributee
Dated as of December 15, 1998
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (THIS "AGREEMENT"), dated as of December
15, 1998, is between THE XXXXX XXXXXX GROUP 1, LTD., a Texas limited partnership
(THE "CONTRIBUTOR"), and SAKER ONE CORPORATION, a Utah Corporation
("CONTRIBUTEE").
RECITALS
A.Pursuant to an Acquisition Agreement dated as of December 15, 1998 (THE
"ACQUISITION AGREEMENT"), Contributee acquired all of the outstanding capital
stock of Triad Compressor, Inc., a Texas corporation ("TRIAD-TEXAS") in exchange
for shares of common stock of Contributee issued to the shareholders of
TRIAD-TEXAS (THE "SHAREHOLDERS").
B. Contributor is a Party to that certain Organization and Licensing
Agreement (the "KG CENTRIFUGE AGREEMENT"), dated as of December 1, 1994, by and
between Trinity Research, Inc. ("TRINITY") and Contributor, a copy of which is
attached as Exhibit A.
C. The Acquisition Agreement contemplates that concurrently with the
contribution by the Shareholders of the stock of Triad-Texas, Contributor shall
enter into this Agreement with Contributee.
STATEMENT OF AGREEMENT
In consideration of the foregoing, the mutual representations,
warranties, covenants and agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Contributor and the Contributee hereby agree as follows:
ARTICLE I
THE TRANSACTION
1.1 ISSUANCE OF SHARES. Subject to the terms and conditions set forth herein,
the Contributee shall issue to the Contributor 800,000 shares of the
contributee's common stock, par value $.01 per share (THE "SHARES").
1.2 ROYALTY PAYMENTS.
(A) SEPARATION TECHNOLOGY. For the purpose of this Agreement,
"SEPARATION TECHNOLOGY" shall include, but not be limited to, (i) U.S.
Patent 5,902,224, and related U.S. patent filings (including, without
limitation, continuations, divisionals and continuations-in-part thereof),
and foreign counterpart patent filings to these, and the inventions more
fully described therein, (ii) the Mass-Mass Cell Centrifuge technology
described in Exhibit B to this Agreement, (iii) the Censa Rotor centrifuge
technology described in Exhibit C to this Agreement, (iv) the Compressor
technology described in Exhibit D to this Agreement, (v) all designs,
technical information, know-how, knowledge, data specifications, test
results, formulas, patent applications, drawings, prototypes and other
information which arise from or relate to the selective separation and
purification of gas components from a mixture thereof and (vi) all future
improvements, developments, derivative works or additions to any of the
aforementioned of any kind that may be developed directly or indirectly by
Contributee.
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(B) ROYALTY PAYMENT. Subject to the terms and conditions set forth
herein, the Contributee agrees to pay Contributor a royalty payment (the
"ROYALTY PAYMENT") equal to the greater of (a) 0.444% of gross receipts
derived from the use, benefit, licensing, transfer and sale of the
Separation Technology, or (b) a minimum royalty payment of $4,444 per year.
The right to receive royalty payments (the "ROYALTY") shall commence with
respect to gross receipts received by Contributee for the calendar year
ending December 31, 2000. For the purpose of this provision, gross receipts
shall be interpreted to include any and all revenue that may be derived in
connection with or relating to the use, benefit, licensing, transfer or
sale of the Separation Technology, regardless whether such revenue was
received in cash securities or other property. Royalty Payments shall be
due upon such gross receipts received for the life of the Separation
Technology. Contributor agrees that Royalty Payments shall attach to the
Separation Technology regardless of the entity that derives the benefit
from the Separation Technology, including, without limitation, continued
Royalty Payments under this Agreement as a condition for the sale, transfer
or conveyance of the Separation Technology to any third party.
1.3 ASSIGNMENT. Subject to the terms and conditions set forth herein, and as
full consideration for the issuance of the Shares by the Contributee to
Contributor, the Contributor hereby grants, assigns, transfers, conveys,
delivers and confirms unto Contributee and its successors and assigns forever,
all right, title and interest in and to the KG Centrifuge Agreement, free and
clear of all claims, liens and encumbrances. Contributee hereby accepts such
assignment and hereby assumes all duties and obligations of Contributor with
respect to the KG Centrifuge Agreement.
1.4 THE CLOSING.
(A) CLOSING OF TRANSACTIONS. The Closing of all transactions set forth
herein (the "CLOSING"), including all transfers, assignments and payments,
shall occur effective as of the date hereof at such place as the parties
may mutually agree. The date on which the Closing of all of the
transactions contemplated hereby occurs is herein referred to as the
"CLOSING DATE."
(B) DELIVERIES BY THE CONTRIBUTEE. At the Closing, the Contributee
shall deliver to the Contributor: (i) one or more stock certificates
representing the Shares, each registered in such names as the Contributor
shall designate, (ii) all other documents, instruments and writings
required to be delivered at or prior to the Closing by the Contributee in
order to complete the transactions contemplated by this Agreement.
(C) DELIVERIES BY THE CONTRIBUTOR. At the Closing, the Contributor
shall deliver to the Contributee all documents, instruments and writings
required to be executed and delivered at or prior to the Closing by the
Contributor in order to complete the transactions contemplated by this
Agreement.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTEE. The Contributee hereby
represents and warrants to the Contributor as of the date hereof:
(A) ORGANIZATION AND QUALIFICATION. The Contributee is a corporation,
duly organized, validly existing and in good standing under the laws of the
State of Utah, with the requisite corporate power and authority to own and
use its properties and assets and to carry on its business as currently
conducted. The Contributee is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not have a material adverse effect on the
business, assets or financial condition of the Contributee.
(B) AUTHORIZATION; ENFORCEMENT. The Contributee has the requisite
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Contributee and the consummation by it of the transactions contemplated
hereby and thereby has been duly authorized by all requisite corporate
action on the part of the Contributee. This Agreement has been duly
executed and delivered by the Contributee and constitutes the legal, valid
and binding obligation of the Contributee enforceable against the
Contributee in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws affecting creditors' rights or by
other equitable principles of general application. The execution, delivery
and performance of this Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby will not require
any notice to, filing with, or the consent, approval or authorization of
any person or governmental authority.
(C) CAPITALIZATION. The authorized capital stock of the Contributee
consists of 25,000,000 shares of common stock, 14,600,000 shares of which
are issued and outstanding. No shares of any capital stock of the
Contributee are entitled to preemptive or similar rights, nor is any holder
entitled to preemptive or similar rights arising out of any agreement or
understanding with the Contributee. There are no outstanding options,
warrants, conversion rights, exchange rights, exercise rights, calls,
commitments or other rights of any character whatsoever giving any person
any right to subscribe for or acquire any capital stock of the Contributee,
or any contracts, commitments, understandings, or arrangements by which the
Contributee is or may become bound to issue additional shares of its
capital stock.
(D) ISSUANCE OF SHARES. The Shares have been duly authorized, and when
issued and paid for in accordance with the terms hereof, shall be validly
issued, fully paid and nonassessable.
(E) NO CONFLICTS. The execution, delivery and performance of this
Agreement and the Royalty Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby and thereby do
not and will not: (i) conflict with or violate any provision of the
3
Contributee's charter documents or bylaws; (ii) conflict with, constitute a
default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Contributee is a party or by which any asset of the
Contributee is bound or affected; or (iii) result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Contributee
is subject (including federal and state securities laws and regulations),
or by which any asset of the Contributee is bound or affected.
(F) PRIVATE OFFERING. The offer and sale of the Shares are exempt from
registration under Section 5 of The Securities Act of 1933, as amended (the
"SECURITIES ACT"). Neither the Contributee nor any person acting on its
behalf has taken or will take any action which might subject the offering,
issuance or sale of the Shares to the registration requirements of Section
5 of the Securities Act.
2.2 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR. The Contributor hereby
represents and warrants to the Contributee as of the date hereof:
(A) POWER AND AUTHORITY. The Contributor is a duly organized and
validly existing Texas limited partnership. The Contributor has the
requisite power and authority to execute and deliver the Agreement, to
perform his obligations hereunder and to consummate the transactions
contemplated hereby.
(B) ENFORCEMENT. This Agreement has been duly executed and delivered
by the Contributor and constitutes the legal, valid and binding obligation
of the Contributor enforceable against the Contributor in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws affecting creditors' rights or by other equitable principles of
general application. The execution, delivery and performance of this
Agreement by the Contributor and the consummation by the Contributor of the
transactions contemplated hereby will not require any notice to, filing
with, or the consent, approval or authorization of any person or
governmental authority.
(C) INVESTMENT INTENT. The Contributor is acquiring the Shares for
Contributor's own account for investment purposes only and not with a view
to or for distributing or reselling the Shares or any part thereof or
interest therein, without prejudice, however, to the Contributor's right at
all times to sell or otherwise dispose of all or any part of the Shares
pursuant to an effective registration statement under the Securities Act
and in compliance with applicable state securities laws, or under an
exemption from such registration.
(D) ACCESS TO INFORMATION. The Contributor acknowledges that
Contributor has been afforded: (i) the opportunity to ask such questions as
he deemed necessary of, and to receive answers from, representatives of the
Contributee concerning the terms and conditions of the offering of the
Shares, and the merits and risks of investing in the Shares; (ii) access to
information about the Contributee and the Contributee's financial
condition, results of operations, business, properties, management and
prospects sufficient to enable him to evaluate his investment; and (iii)
the opportunity to obtain such additional information which the Contributee
4
possesses or can acquire without unreasonable effort or expense that the
Contributor believes is necessary to make an informed investment decision
with respect to the Shares.
(E) NO VIOLATIONS; CONFLICTS. The execution, delivery and performance
of this Agreement by the Contributor and the consummation by the
Contributor of the transactions contemplated hereby do not and will not:
(i) conflict with, constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Contributor is a party or
by which any property of the Contributor is bound or affected; or (ii)
result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental
authority to which the Contributor is subject (including federal and state
securities laws and regulations), or by which any asset of the Contributor
is bound or affected. The Contributor has not granted, assigned,
transferred or conveyed any right, title or interest whatsoever in or to
the Separation Technology to any person or entity other than the
Contributee, and no lien exists on, in or against the Separation
Technology.
ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 TRANSFER RESTRICTIONS.
(A) REGISTRATION REQUIREMENTS. If the Contributor decides to dispose
of any of the Shares held by Contributor, the Contributor understands and
agrees that he may do so only pursuant to an effective registration
statement under the Securities Act or pursuant to an available exemption
from the registration requirements of the Securities Act.
(B) LEGEND. The Contributor agrees to the imprinting of the following
legend on the certificates representing the Shares:
THE ISSUANCE OF THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
5
ARTICLE IV
INDEMNIFICATION AND DAMAGES
4.1 INDEMNIFICATION BY CONTRIBUTEE. The Contributee shall indemnify, defend, and
hold the Contributor and its successors and assigns harmless from any and all
claims, losses, liabilities and damages, including, without limitation, amounts
paid in settlement, reasonable costs of investigation and reasonable fees and
disbursements of counsel, directly or indirectly related or arising with respect
to (i) any inaccuracy in any representation or warranty of the Contributee under
this Agreement; or (ii) any failure to perform or observe any covenant or
agreement to be performed by the Contributee set forth in this Agreement or any
document delivered to the Contributor pursuant to this Agreement.
4.2 INDEMNIFICATION BY CONTRIBUTOR. The Contributor shall indemnify, defend, and
hold the Contributee and its successors and assigns harmless from and against
any and all claims, losses, liabilities and damages, including, without
limitation, amounts paid in settlement, reasonable costs of investigation and
reasonable fees and disbursements of counsel, directly or indirectly related or
arising with respect to (i) any inaccuracy in any representation or warranty of
the Contributor under this Agreement; or (ii) any failure to perform or observe
any covenant or agreement to be performed by the Contributor set forth in this
Agreement or any document delivered to the Contributee pursuant to this
Agreement.
ARTICLE V
MISCELLANEOUS
5.1 FEES AND EXPENSES. The Contributee shall pay the fees and expenses of both
the Contributee and the Contributor incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. In connection therewith,
the Contributee shall promptly reimburse the Contributor for any such fees and
expenses that Contributor has incurred, including the fees and expenses of the
Contributor's legal counsel. The Contributee shall pay all stamp and other taxes
and duties levied in connection with the issuance of the Securities pursuant
hereto.
5.2 ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.
5.3 NOTICES. Any notice or other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed to
the address listed below:
If to the Contributee:
SAKER ONE CORPORATION
Xxxxx Building
000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxx
6
If to the Contributor:
The Xxxxx Xxxxxx Group I, Ltd.
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
5.4 AMENDMENTS; WAIVERS. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by both the
Contributee and the Contributor; or in the case of a waiver, by the party
against whom enforcement of any such waiver is sought. No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
5.5 HEADINGS. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
5.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.
5.7 GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Texas without
regard to the principles of conflicts of law thereof.
5.8 SURVIVAL. The agreements, covenants, and representations and warranties
contained in this Agreement shall survive the Closing.
5.9 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the executing party with the same force and effect as if such
facsimile signature page were an original thereof.
5.10 SEVERABILITY. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
7
5.11 FURTHER ASSURANCES. Each party to this Agreement agrees to execute such
documents or instruments, and to take such action, as the other party may
reasonably request after the Closing Date in order to effectuate and perfect the
transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
CONTRIBUTOR
The Xxxxx Xxxxxx Group I, Ltd.
By:____________________________
Name:__________________________
Title:_________________________
CONTRIBUTEE
SAKER ONE CORPORATION, a Utah corporation
By:____________________________
Name:__________________________
Title:_________________________
CONSENT TO TRANSFER AND ASSIGNMENT
Trinity Research, Inc., a Minnesota corporation and Xxxxxxx X. Xxxxx hereby
consent to the assignment by Contributor to Contributee of Contributor's right,
title and interest in and to the KG Centrifuge Agreement as described above.
TRINITY RESEARCH, INC.
By:___________________________
Name:_________________________
Title:________________________
______________________________
Xxxxxxx X. Xxxxx
9
CONTRIBUTION AGREEMENT
between
TRINITY RESEARCH, INC.
and
XXXXXXX X. XXXXX
as the Contributors
and
SAKER ONE CORPORATION
as the Contributee
Dated as of December 15, 1998
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (THIS "AGREEMENT"), dated as of December
15, 1998, is between TRINITY RESEARCH, INC., a Minnesota corporation ("TRINITY")
XXXXXXX X. XXXXX, an individual and resident of the State of Minnesota
("BLOOM"), and SAKER ONE CORPORATION, a Utah Corporation ("CONTRIBUTEE").
RECITALS
A.Pursuant to an Acquisition Agreement dated as of December 15, 1998 (THE
"ACQUISITION AGREEMENT"), Contributee acquired all of the outstanding capital
stock of Triad Compressor, Inc., a Texas corporation ("TRIAD-TEXAS") in exchange
for shares of common stock of Contributee issued to the shareholders of
TRIAD-TEXAS (THE "SHAREHOLDERS").
B. Trinity and Bloom (collectively referred to herein as the
"CONTRIBUTORS") are parties to that certain Exclusive License and Research
Agreement, dated as of May 1, 1994, by and between Trinity Research, Inc.,
Xxxxxxx X. Xxxxx, and Natural Resources Limited company (the "NRL CENTRIFUGE
AGREEMENT"), a copy of which is attached as Exhibit A-2.
C. The Acquisition Agreement contemplates that concurrently with the
contribution by the Shareholders of the stock of Triad-Texas, Contributor shall
enter into this Agreement with Contributee.
D. Trinity and Bloom have heretofore transferred and assigned to
Triad-Texas all rights in and to any technology that is the subject of that
certain License Agreement (the "COMPRESSOR AGREEMENT") dated as of March 13,
1996 by and between Xxxxx X. XxXxxxx and Triad-Texas, a copy of which is
attached as Exhibit A-3.
E. Trinity and Bloom have individually or collectively developed certain
technology (the "TRANSFERRED TECHNOLOGY") including, but not limited to, (i)
U.S. Patent 5,902,224, and related U.S. patent filings (including, without
limitation, continuations, divisionals and continuations-in-part thereof), and
foreign counterpart patent filings to these, and the inventions more fully
described therein, (ii) the Mass-Mass Cell Centrifuge technology described in
Exhibit B to this Agreement, (iii) the Censa Rotor centrifuge technology
described in Exhibit C to this Agreement, (iv) the Compressor technology
described in Exhibit D to this Agreement, (v) all designs, technical
information, know-how, knowledge, data specifications, test results, formulas,
patent applications, drawings, prototypes and other information which arise from
or relate to the selective separation and purification of gas components from a
mixture thereof and (vi) all future improvements, developments, derivative works
or additions to any of the aforementioned of any kind that may be developed
directly or indirectly by Contributors.
F. The Acquisition Agreement contemplates that concurrently with the
contribution by the Shareholders of the stock of Triad-Texas, Contributors shall
enter into this Agreement with Contributee.
1
STATEMENT OF AGREEMENT
In consideration of the foregoing, the mutual representations,
warranties, covenants and agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Contributor and the Contributee hereby agree as follows:
ARTICLE I
THE TRANSACTION
1.1 ISSUANCE OF SHARES. Subject to the terms and conditions set forth herein at
the Closing, the Contributee shall issue to the Contributors 2,500,000 shares of
the Contributee's common stock, par value $.01 per share (the "SHARES"). The
Contributors agree that the shares shall be issued to Bloom in full satisfaction
of Contributee's obligation hereunder to issue the shares to Contributors.
1.2 ROYALTY PAYMENTS.
(A) SEPARATION TECHNOLOGY. For the purpose of this Agreement,
"SEPARATION TECHNOLOGY" shall include, but not be limited to, (i) U.S.
Patent 5,902,224, and related U.S. patent filings (including, without
limitation, continuations, divisionals and continuations-in-part thereof),
and foreign counterpart patent filings to these, and the inventions more
fully described therein, (ii) the Mass-Mass Cell Centrifuge technology
described in Exhibit B to this Agreement, (iii) the Censa Rotor centrifuge
technology described in Exhibit C to this Agreement, (iv) the Compressor
technology described in Exhibit D to this Agreement, (v) all designs,
technical information, know-how, knowledge, data specifications, test
results, formulas, patent applications, drawings, prototypes and other
information which arise from or relate to the selective separation and
purification of gas components from a mixture thereof and (vi) all future
improvements, developments, derivative works or additions to any of the
aforementioned of any kind that may be developed directly or indirectly by
Contributee.
(B) ROYALTY PAYMENT. Subject to the terms and conditions set forth
herein and effected at the Closing Date, the Contributee agrees to pay
Contributors an aggregate royalty payment (the "ROYALTY PAYMENT") equal to
the greater of (a) 0.444% of gross receipts derived from the use, benefit,
licensing, transfer and sale of the Separation Technology, or (b) a minimum
royalty payment of $4,444 per year. The right to receive royalty payments
(the "ROYALTY") shall commence with respect to gross receipts received by
Contributee for the calendar year ending December 31, 2000. For the purpose
of this provision, gross receipts shall be interpreted to include any and
all revenue that may be derived in connection with or relating to the use,
benefit, licensing, transfer or sale of the Separation Technology,
regardless whether such revenue was received in cash securities or other
property. Royalty Payments shall be due upon such gross receipts received
for the life of the Separation Technology. Contributors and Contributee
agree that Royalty Payments shall attach to the Separation Technology
regardless of the entity that derives the benefit from the Separation
Technology, including, without limitation, continued Royalty Payments under
this Agreement as a condition for the sale, transfer or conveyance of the
Separation Technology to any third party.
2
(C) PAYMENT. At the election of the Contributors, Royalty Payments
shall be payable (i) in cash or (ii) in additional shares of common stock
of the Contributee. Royalty Payments shall be paid by Contributee to
Contributor within thirty (30) days after the conclusion of each calendar
quarter, provided, however, that royalties based on non-U.S. or non-cash
gross receipts may be paid within sixty (60) days after the conclusion of
the relevant quarter. Royalty Payments shall be accompanied by a detailed
accounting of the basis for such payment, identifying the source and amount
of applicable revenues so received. Contributors hereby agree that all
Royalty Payments to be made pursuant to this Agreement shall be made to
Bloom in full satisfaction of Contributee's obligation hereunder to pay
royalties to Contributors and all elections, notices or other actions that
may be taken by Contributors shall be taken solely by Bloom.
(D) RIGHT TO AUDIT. Contributee shall, upon written request from
Contributor, during normal business hours, but not more frequently than
once each calendar year, provide access to pertinent records relating to
gross receipts received and Royalties Payments payable in connection with
the Separation Technology under this Agreement, to an independent
accounting firm chosen by Contributor for purposes of auditing the amount
of Royalty Payments due to Contributor during any calendar year.
Contributee shall be responsible for all expenses associated with such
audit. Upon receipt by Contributee of a request for an audit as provided
hereby, Contributee shall provide a copy of such request within 10 days
after receipt thereof to all Royalty holders entitled to Royalty Payments
with respect to the Separation Technology. The independent audit firm
selected to conduct such audit shall be designated by the holders of a
majority-in-interest (by Royalty percentage) of the Royalties within 30
days after receipt by such holders of notice of a request for audit.
Royalty holders who fail to designate an audit firm shall be deemed to
concur with the selection of an auditor made by the Royalty holder who
initiates an audit request. In no event shall Contributee be required to
conduct more than one audit per year on behalf of all royalty holders.
1.3 ASSIGNMENT. Subject to the terms and conditions set forth herein, and as
full consideration for the issuance of the Shares by the Contributee to
Contributors, and the Royalty Payment to be paid hereunder, the Contributors
hereby grant, assign, transfer, convey, deliver and confirm unto Contributee and
its successors and assigns forever, all right, title and interest in and to the
NRL Centrifuge Agreement, the KG Centrifuge Agreement, the Compressor Agreement
and the Transferred Technology, free and clear of all claims, liens and
encumbrances other than the right of Contributors to receive the Royalty Payment
pursuant to this Agreement. Contributee hereby accepts such assignment and
hereby assumes all duties and obligations of Contributors with respect to the
NRL Centrifuge Agreement, the KG Centrifuge Agreement, the Compressor Agreement
and the Transferred Technology.
3
1.4 THE CLOSING.
(A) CLOSING OF TRANSACTIONS. The Closing of all transactions set forth
herein (the "CLOSING"), including all transfers, assignments and payments,
shall occur effective the date hereof at such place as the parties may
mutually agree. The date on which the Closing of all of the transactions
contemplated hereby occurs is herein referred to as the "CLOSING DATE."
(B) DELIVERIES BY THE CONTRIBUTEE. At the Closing, the Contributee
shall deliver to the Contributors: (i) one or more stock certificates
representing the Shares, each registered in the name of Bloom, (ii) all
other documents, instruments and writings required to be delivered at or
prior to the Closing by the Contributee in order to complete the
transactions contemplated by this Agreement.
(C) DELIVERIES BY THE CONTRIBUTOR. At the Closing, the Contributor
shall deliver to the Contributee all documents, instruments and writings
required to be executed and delivered at or prior to the Closing by the
Contributor in order to complete the transactions contemplated by this
Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTEE. The Contributee hereby
represents and warrants to the Contributor as of the date hereof:
(A) ORGANIZATION AND QUALIFICATION. The Contributee is a corporation,
duly organized, validly existing and in good standing under the laws of the
State of Utah, with the requisite corporate power and authority to own and
use its properties and assets and to carry on its business as currently
conducted. The Contributee is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not have a material adverse effect on the
business, assets or financial condition of the Contributee.
(B) AUTHORIZATION; ENFORCEMENT. The Contributee has the requisite
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Contributee and the consummation by it of the transactions contemplated
hereby and thereby has been duly authorized by all requisite corporate
action on the part of the Contributee. This Agreement has been duly
executed and delivered by the Contributee and constitutes the legal, valid
and binding obligation of the Contributee enforceable against the
Contributee in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws affecting creditors' rights or by
other equitable principles of general application. The execution, delivery
and performance of this Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby will not require
any notice to, filing with, or the consent, approval or authorization of
any person or governmental authority.
4
(C) CAPITALIZATION. The authorized capital stock of the Contributee
consists of 25,000,000 shares of common stock, 14,600,000 shares of which
are issued and outstanding. No shares of any capital stock of the
Contributee are entitled to preemptive or similar rights, nor is any holder
entitled to preemptive or similar rights arising out of any agreement or
understanding with the Contributee. There are no outstanding options,
warrants, conversion rights, exchange rights, exercise rights, calls,
commitments or other rights of any character whatsoever giving any person
any right to subscribe for or acquire any capital stock of the Contributee,
or any contracts, commitments, understandings, or arrangements by which the
Contributee is or may become bound to issue additional shares of its
capital stock.
(D) ISSUANCE OF SHARES. The Shares have been duly authorized, and when
issued and paid for in accordance with the terms hereof, shall be validly
issued, fully paid and nonassessable.
(E) NO CONFLICTS. The execution, delivery and performance of this
Agreement and the Royalty Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby and thereby do
not and will not: (i) conflict with or violate any provision of the
Contributee's charter documents or bylaws; (ii) conflict with, constitute a
default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Contributee is a party or by which any asset of the
Contributee is bound or affected; or (iii) result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Contributee
is subject (including federal and state securities laws and regulations),
or by which any asset of the Contributee is bound or affected.
(F) PRIVATE OFFERING. The offer and sale of the Shares are exempt from
registration under Section 5 of The Securities Act of 1933, as amended (the
"SECURITIES ACT"). Neither the Contributee nor any person acting on its
behalf has taken or will take any action which might subject the offering,
issuance or sale of the Shares to the registration requirements of Section
5 of the Securities Act.
2.2 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS. The Contributors hereby
represent and warrant to the Contributee as of the date hereof:
(A) ORGANIZATION AND QUALIFICATION. Trinity is a corporation, duly
organized, validly existing and in good standing under the laws of the
State of Minnesota, with the requisite corporate power and authority to own
and use its properties and assets and to carry on its business as currently
conducted. Trinity is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction in which the nature of the
business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not have a material adverse effect on the
business, assets or financial condition of the Trinity.
(B) POWER AND AUTHORITY. Trinity has the requisite corporate power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by the Trinity and the
consummation by it of the transactions contemplated hereby and thereby has
been duly authorized by all requisite corporate action on the part of
Trinity. Bloom is an individual residing in the State of Minnesota. Bloom
has the requisite competence and authority to execute and deliver the
Agreement, to perform his obligations hereunder and to consummate the
transactions contemplated hereby.
4
(C) ENFORCEMENT. This Agreement has been duly executed and delivered
by the Contributors and constitutes the legal, valid and binding obligation
of the Contributors enforceable against the Contributor in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws affecting creditors' rights or by other equitable principles of
general application. The execution, delivery and performance of this
Agreement by the Contributors and the consummation by the Contributors of
the transactions contemplated hereby will not require any notice to, filing
with, or the consent, approval or authorization of any person or
governmental authority.
(D) INVESTMENT INTENT. The Contributors are acquiring the Shares for
Contributors' own account for investment purposes only and not with a view
to or for distributing or reselling the Shares or any part thereof or
interest therein, without prejudice, however, to the Contributors' right at
all times to sell or otherwise dispose of all or any part of the Shares
pursuant to an effective registration statement under the Securities Act
and in compliance with applicable state securities laws, or under an
exemption from such registration.
(E) ACCESS TO INFORMATION. The Contributors acknowledge that
Contributors have been afforded: (i) the opportunity to ask such questions
as he deemed necessary of, and to receive answers from, representatives of
the Contributee concerning the terms and conditions of the offering of the
Shares, and the merits and risks of investing in the Shares; (ii) access to
information about the Contributee and the Contributee's financial
condition, results of operations, business, properties, management and
prospects sufficient to enable him to evaluate his investment; and (iii)
the opportunity to obtain such additional information which the Contributee
possesses or can acquire without unreasonable effort or expense that the
Contributors believe is necessary to make an informed investment decision
with respect to the Shares.
(F) NO VIOLATIONS; CONFLICTS. The execution, delivery and performance
of this Agreement by the Contributors and the consummation by the
Contributors of the transactions contemplated hereby do not and will not:
(i) conflict with, constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Contributor is a party or
by which any property of the Contributor is bound or affected; or (ii)
result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental
authority to which the Contributor is subject (including federal and state
securities laws and regulations), or by which any asset of the Contributor
is bound or affected; or (iii) violate any charter provision or bylaw of
Trinity. The Contributors have not granted, assigned, transferred or
conveyed any right, title or interest whatsoever in or to the NRL
Centrifuge Agreement, the KG Centrifuge Agreement, the Compressor Agreement
(including all rights of any kind to the technology covered by the NRL
Centrifuge Agreement, the KG Centrifuge Agreement or the Agreement), the
Transferred Technology to any person or entity other than the Contributee,
and no lien exists on, in or against the Transferred Technology.
6
ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 TRANSFER RESTRICTIONS.
(A) REGISTRATION REQUIREMENTS. If the Contributor decides to dispose
of any of the Shares held by Contributor, the Contributor understands and
agrees that he may do so only pursuant to an effective registration
statement under the Securities Act or pursuant to an available exemption
from the registration requirements of the Securities Act.
(B) LEGEND. The Contributors agree to the imprinting of the following
legend on the certificates representing the Shares:
THE ISSUANCE OF THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
ARTICLE IV
INDEMNIFICATION AND DAMAGES
4.1 INDEMNIFICATION BY CONTRIBUTEE. The Contributee shall indemnify, defend, and
hold the Contributors and their successors and assigns harmless from any and all
claims, losses, liabilities and damages, including, without limitation, amounts
paid in settlement, reasonable costs of investigation and reasonable fees and
disbursements of counsel, directly or indirectly related or arising with respect
to (i) any inaccuracy in any representation or warranty of the Contributee under
this Agreement; or (ii) any failure to perform or observe any covenant or
agreement to be performed by the Contributee set forth in this Agreement or any
document delivered to the Contributors pursuant to this Agreement.
4.2 INDEMNIFICATION BY CONTRIBUTORS. The Contributors shall indemnify, defend,
and hold the Contributee and its successors and assigns harmless from and
against any and all claims, losses, liabilities and damages, including, without
limitation, amounts paid in settlement, reasonable costs of investigation and
reasonable fees and disbursements of counsel, directly or indirectly related or
arising with respect to (i) any inaccuracy in any representation or warranty of
the Contributors under this Agreement; or (ii) any failure to perform or observe
any covenant or agreement to be performed by the Contributors set forth in this
Agreement or any document delivered to the Contributee pursuant to this
Agreement.
7
ARTICLE V
MISCELLANEOUS
5.1 FEES AND EXPENSES. The Contributee shall pay the fees and expenses of both
the Contributee and the Contributors incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. In connection therewith,
the Contributee shall promptly reimburse the Contributors for any such fees and
expenses that Contributor has incurred, including the fees and expenses of the
Contributor's legal counsel. The Contributee shall pay all stamp and other taxes
and duties levied in connection with the issuance of the Securities pursuant
hereto.
5.2 ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.
5.3 NOTICES. Any notice or other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed to
the address listed below:
If to the Contributee:
SAKER ONE CORPORATION
Xxxxx Building
000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxx
If to the Contributors:
Trinity Research, Inc.
Xxxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
5.4 AMENDMENTS; WAIVERS. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by both the
Contributee and the Contributors; or in the case of a waiver, by the party
against whom enforcement of any such waiver is sought. No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
8
5.5 HEADINGS. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
5.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.
5.7 GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Texas without
regard to the principles of conflicts of law thereof.
5.8 SURVIVAL. The agreements, covenants, and representations and warranties
contained in this Agreement shall survive the Closing.
5.9 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the executing party with the same force and effect as if such
facsimile signature page were an original thereof.
5.10 SEVERABILITY. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
5.11 FURTHER ASSURANCES. Each party to this Agreement agrees to execute such
documents or instruments, and to take such action, as the other party may
reasonably request after the Closing Date in order to effectuate and perfect the
transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
9
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
CONTRIBUTORS
TRINITY RESEARCH, INC.
By:___________________________
Name:_________________________
Title:________________________
XXXXXXX X. XXXXX
______________________________
XXXXXXX X. XXXXX
CONTRIBUTEE
SAKER ONE CORPORATION, a Utah corporation
By:____________________________
Name:__________________________
Title:_________________________
10
CONTRIBUTION AGREEMENT
between
NATURAL RESOURCES LIMITED COMPANY
as the Contributor
and
SAKER ONE CORPORATION
as the Contributee
Dated as of December 15, 1998
CONTRIBUTION AGREEMENT
This Contribution Agreement (this "AGREEMENT"), dated as of December
15, 1998, is between NATURAL RESOURCES LIMITED COMPANY, a Texas Limited
Liability Company (the "CONTRIBUTOR"), and SAKER ONE CORPORATION, a Utah
Corporation ("CONTRIBUTEE").
RECITALS
A.Pursuant to an Acquisition Agreement dated as of December 15, 1998
(THE "ACQUISITION AGREEMENT"), Contributee acquired all of the outstanding
capital stock of Triad Compressor, Inc., a Texas corporation
("TRIAD-TEXAS") in exchange for shares of common stock of Contributee
issued to the shareholders of Triad-Texas (THE "SHAREHOLDERS").
B.Contributor is a Party to that certain exclusive License and
Research Agreement (the "NRL CENTRIFUGE AGREEMENT") dated May 1, 1994, by
and between Trinity Research, Inc., Xxxxxxx X. Xxxxx and Contributor a copy
of which is attached as Exhibit A.
C. The Acquisition Agreement contemplates that concurrently with the
contribution by the Shareholders of the stock of Triad-Texas, Contributor
shall enter into this Agreement with Contributee.
STATEMENT OF AGREEMENT
In consideration of the foregoing, the mutual representations,
warranties, covenants and agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Contributor and the Contributee hereby agree as follows:
ARTICLE I
THE TRANSACTION
1.1 ISSUANCE OF SHARES. Subject to the terms and conditions set forth herein,
the Contributee shall issue to the Contributor 1,200,000 shares of the
Contributee's common stock, par value $.01 per share (the "SHARES").
1.2 ROYALTY PAYMENTS.
(A) SEPARATION TECHNOLOGY. For the purpose of this Agreement,
"SEPARATION TECHNOLOGY" shall include, but not be limited to, (i) U.S.
Patent 5,902,224, and related U.S. patent filings (including, without
limitation, continuations, divisionals and continuations-in-part thereof),
and foreign counterpart patent filings to these, and the inventions more
fully described therein, (ii) the Mass-Mass Cell Centrifuge technology
described in Exhibit B to this Agreement, (iii) the Censa Rotor centrifuge
technology described in Exhibit C to this Agreement, (iv) the Compressor
technology described in Exhibit D to this Agreement, (v) all designs,
technical information, know-how, knowledge, data specifications, test
results, formulas, patent applications, drawings, prototypes and other
information which arise from or relate to the selective separation and
purification of gas components from a mixture thereof and (vi) all future
improvements, developments, derivative works or additions to any of the
aforementioned of any kind that may be developed directly or indirectly by
Contributee.
1
(B) ROYALTY PAYMENT. Subject to the terms and conditions set forth
herein, the Contributee agrees to pay Contributor a royalty payment (the
"ROYALTY PAYMENT") equal to the greater of (a) 0.666% of gross receipts
derived from the use, benefit, licensing, transfer and sale of the
Separation Technology, or (b) a minimum royalty payment of $6,666 per year.
The right to receive royalty payments (the "ROYALTY") shall commence with
respect to gross receipts received by Contributee for the calendar year
ending December 31, 2000. For the purpose of this provision, gross receipts
shall be interpreted to include any and all revenue that may be derived in
connection with or relating to the use, benefit, licensing, transfer or
sale of the Separation Technology, regardless whether such revenue was
received in cash securities or other property. Royalty Payments shall be
due upon such gross receipts received for the life of the Separation
Technology. Contributor agrees that Royalty Payments shall attach to the
Separation Technology regardless of the entity that derives the benefit
from the Separation Technology, including, without limitation, continued
Royalty Payments under this Agreement as a condition for the sale, transfer
or conveyance of the Separation Technology to any third party.
(C) PAYMENT. At the election of the Contributor, Royalty Payments
shall be payable (i) in cash or (ii) in additional shares of common stock
of the Contributee. Royalty Payments shall be paid by Contributee to
Contributor within thirty (30) days after the conclusion of each calendar
quarter, provided, however, that royalties based on non-U.S. or non-cash
gross receipts may be paid within sixty (60) days after the conclusion of
the relevant quarter. Royalty Payments shall be accompanied by a detailed
accounting of the basis for such payment, identifying the source and amount
of applicable revenues so received.
(D) RIGHT TO AUDIT. Contributee shall, upon written request from
Contributor, during normal business hours, but not more frequently than
once each calendar year, provide access to pertinent records relating to
gross receipts received and Royalties Payments payable in connection with
the Separation Technology under this Agreement, to an independent
accounting firm chosen by Contributor for purposes of auditing the amount
of Royalty Payments due to Contributor during any calendar year.
Contributee shall be responsible for all expenses associated with such
audit. Upon receipt by Contributee of a request for an audit as provided
hereby, Contributee shall provide a copy of such request within 10 days
after receipt thereof to all Royalty holders entitled to Royalty Payments
with respect to the Separation Technology. The independent audit firm
selected to conduct such audit shall be designated by the holders of a
majority-in-interest (by Royalty percentage) of the Royalties within 30
days after receipt by such holders of notice of a request for audit.
Royalty holders who fail to designate an audit firm shall be deemed to
concur with the selection of an auditor made by the Royalty holder who
initiates an audit request. In no event shall Contributee be required to
conduct more than one audit per year on behalf of all royalty holders.
1.3 ASSIGNMENT. Subject to the terms and conditions set forth herein, and as
full consideration for the issuance of the Shares by the Contributee to
Contributor, and the Royalty Payment to be paid hereunder, the Contributor
hereby grants, assigns, transfers, conveys, delivers and confirms unto
Contributee and its successors and assigns forever, all right, title and
interest in and to the NRL Centrifuge Agreement, free and clear of all claims,
liens and encumbrances other than the right of Contributor to receive the
Royalty Payment pursuant to this Agreement. Contributee hereby accepts such
assignment and hereby assumes all duties and obligations of Contributee with
respect to the NRL Centrifuge Agreement.
2
1.4 THE CLOSING.
(A) CLOSING OF TRANSACTIONS. The Closing of all transactions set forth
herein (the "CLOSING"), including all transfers, assignments and payments,
shall occur effective as of the date hereof at such place as the parties
may mutually agree. The date on which the Closing of all of the
transactions contemplated hereby occurs is herein referred to as the
"CLOSING DATE."
(B) DELIVERIES BY THE CONTRIBUTEE. At the Closing, the Contributee
shall deliver to the Contributor: (i) one or more stock certificates
representing the Shares, each registered in such names as the Contributor
shall designate, (ii) all other documents, instruments and writings
required to be delivered at or prior to the Closing by the Contributee in
order to complete the transactions contemplated by this Agreement.
(C) DELIVERIES BY THE CONTRIBUTOR. At the Closing, the Contributor
shall deliver to the Contributee all documents, instruments and writings
required to be executed and delivered at or prior to the Closing by the
Contributor in order to complete the transactions contemplated by this
Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTEE. The Contributee hereby
represents and warrants to the Contributor as of the date hereof:
(A) ORGANIZATION AND QUALIFICATION. The Contributee is a corporation,
duly organized, validly existing and in good standing under the laws of the
State of Utah, with the requisite corporate power and authority to own and
use its properties and assets and to carry on its business as currently
conducted. The Contributee is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not have a material adverse effect on the
business, assets or financial condition of the Contributee.
(B) AUTHORIZATION; ENFORCEMENT. The Contributee has the requisite
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Contributee and the consummation by it of the transactions contemplated
hereby and thereby has been duly authorized by all requisite corporate
action on the part of the Contributee. This Agreement has been duly
executed and delivered by the Contributee and constitutes the legal, valid
and binding obligation of the Contributee enforceable against the
Contributee in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws affecting creditors' rights or by
other equitable principles of general application. The execution, delivery
and performance of this Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby will not require
any notice to, filing with, or the consent, approval or authorization of
any person or governmental authority.
3
(C) CAPITALIZATION. The authorized capital stock of the Contributee
consists of 25,000,000 shares of common stock, 14,600,000 shares of which
are issued and outstanding. No shares of any capital stock of the
Contributee are entitled to preemptive or similar rights, nor is any holder
entitled to preemptive or similar rights arising out of any agreement or
understanding with the Contributee. There are no outstanding options,
warrants, conversion rights, exchange rights, exercise rights, calls,
commitments or other rights of any character whatsoever giving any person
any right to subscribe for or acquire any capital stock of the Contributee,
or any contracts, commitments, understandings, or arrangements by which the
Contributee is or may become bound to issue additional shares of its
capital stock.
(D) ISSUANCE OF SHARES. The Shares have been duly authorized, and when
issued and paid for in accordance with the terms hereof, shall be validly
issued, fully paid and nonassessable.
(E) NO CONFLICTS. The execution, delivery and performance of this
Agreement and the Royalty Agreement by the Contributee and the consummation
by the Contributee of the transactions contemplated hereby and thereby do
not and will not: (i) conflict with or violate any provision of the
Contributee's charter documents or bylaws; (ii) conflict with, constitute a
default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Contributee is a party or by which any asset of the
Contributee is bound or affected; or (iii) result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Contributee
is subject (including federal and state securities laws and regulations),
or by which any asset of the Contributee is bound or affected.
(F) PRIVATE OFFERING. The offer and sale of the Shares are exempt from
registration under Section 5 of the Securities Act of 1933, as amended (the
"SECURITIES ACT"). Neither the Contributee nor any person acting on its
behalf has taken or will take any action which might subject the offering,
issuance or sale of the Shares to the registration requirements of Section
5 of the Securities Act.
2.2 REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR. The Contributor hereby
represents and warrants to the Contributee as of the date hereof:
(A) POWER AND AUTHORITY. The Contributor is a duly organized and
validly existing Texas limited liability company. The Contributor has the
requisite power and authority to execute and deliver the Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby.
4
(B) ENFORCEMENT. This Agreement has been duly executed and delivered
by the Contributor and constitutes the legal, valid and binding obligation
of the Contributor enforceable against the Contributor in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws affecting creditors' rights or by other equitable principles of
general application. The execution, delivery and performance of this
Agreement by the Contributor and the consummation by the Contributor of the
transactions contemplated hereby will not require any notice to, filing
with, or the consent, approval or authorization of any person or
governmental authority.
(C) INVESTMENT INTENT. The Contributor is acquiring the Shares for
Contributor's own account for investment purposes only and not with a view
to or for distributing or reselling the Shares or any part thereof or
interest therein, without prejudice, however, to the Contributor's right at
all times to sell or otherwise dispose of all or any part of the Shares
pursuant to an effective registration statement under the Securities Act
and in compliance with applicable state securities laws, or under an
exemption from such registration.
(D) ACCESS TO INFORMATION. The Contributor acknowledges that
Contributor has been afforded: (i) the opportunity to ask such questions as
he deemed necessary of, and to receive answers from, representatives of the
Contributee concerning the terms and conditions of the offering of the
Shares, and the merits and risks of investing in the Shares; (ii) access to
information about the Contributee and the Contributee's financial
condition, results of operations, business, properties, management and
prospects sufficient to enable him to evaluate his investment; and (iii)
the opportunity to obtain such additional information which the Contributee
possesses or can acquire without unreasonable effort or expense that the
Contributor believes is necessary to make an informed investment decision
with respect to the Shares.
(E) NO VIOLATIONS; CONFLICTS. The execution, delivery and performance
of this Agreement by the Contributor and the consummation by the
Contributor of the transactions contemplated hereby do not and will not:
(i) conflict with, constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Contributor is a party or
by which any property of the Contributor is bound or affected; or (ii)
result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental
authority to which the Contributor is subject (including federal and state
securities laws and regulations), or by which any asset of the Contributor
is bound or affected. The Contributor has not granted, assigned,
transferred or conveyed any right, title or interest whatsoever in or to
the Separation Technology to any person or entity other than the
Contributee, and no lien exists on, in or against the Separation
Technology.
5
ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 TRANSFER RESTRICTIONS.
(A) REGISTRATION REQUIREMENTS. If the Contributor decides to dispose
of any of the Shares held by Contributor, the Contributor understands and
agrees that he may do so only pursuant to an effective registration
statement under the Securities Act or pursuant to an available exemption
from the registration requirements of the Securities Act.
(B) LEGEND. The Contributor agrees to the imprinting of the following
legend on the certificates representing the Shares:
THE ISSUANCE OF THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
ARTICLE IV
INDEMNIFICATION AND DAMAGES
4.1 INDEMNIFICATION BY CONTRIBUTEE. The Contributee shall indemnify, defend, and
hold the Contributor and its successors and assigns harmless from any and all
claims, losses, liabilities and damages, including, without limitation, amounts
paid in settlement, reasonable costs of investigation and reasonable fees and
disbursements of counsel, directly or indirectly related or arising with respect
to (i) any inaccuracy in any representation or warranty of the Contributee under
this Agreement; or (ii) any failure to perform or observe any covenant or
agreement to be performed by the Contributee set forth in this Agreement or any
document delivered to the Contributor pursuant to this Agreement.
4.2 INDEMNIFICATION BY CONTRIBUTOR. The Contributor shall indemnify, defend, and
hold the Contributee and its successors and assigns harmless from and against
any and all claims, losses, liabilities and damages, including, without
limitation, amounts paid in settlement, reasonable costs of investigation and
reasonable fees and disbursements of counsel, directly or indirectly related or
arising with respect to (i) any inaccuracy in any representation or warranty of
the Contributor under this Agreement; or (ii) any failure to perform or observe
any covenant or agreement to be performed by the Contributor set forth in this
Agreement or any document delivered to the Contributee pursuant to this
Agreement.
6
ARTICLE V
MISCELLANEOUS
5.1 FEES AND EXPENSES. The Contributee shall pay the fees and expenses of both
the Contributee and the Contributor incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. In connection therewith,
the Contributee shall promptly reimburse the Contributor for any such fees and
expenses that Contributor has incurred, including the fees and expenses of the
Contributor's legal counsel. The Contributee shall pay all stamp and other taxes
and duties levied in connection with the issuance of the Securities pursuant
hereto.
5.2 ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.
5.3 NOTICES. Any notice or other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed to
the address listed below:
If to the Contributee:
SAKER ONE CORPORATION
Xxxxx Building
000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxx X. XxXxxxx
If to the Contributor:
Natural Resources Limited Company
000 X. Xxxxxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxx
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
5.4 AMENDMENTS; WAIVERS. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by both the
Contributee and the Contributor; or in the case of a waiver, by the party
against whom enforcement of any such waiver is sought. No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
7
5.5 HEADINGS. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
5.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.
5.7 GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Texas without
regard to the principles of conflicts of law thereof.
5.8 SURVIVAL. The agreements, covenants, and representations and warranties
contained in this Agreement shall survive the Closing.
5.9 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the executing party with the same force and effect as if such
facsimile signature page were an original thereof.
5.10 SEVERABILITY. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
5.11 FURTHER ASSURANCES. Each party to this Agreement agrees to execute such
documents or instruments, and to take such action, as the other party may
reasonably request after the Closing Date in order to effectuate and perfect the
transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
CONTRIBUTOR
NATURAL RESOURCES LIMITED COMPANY
By:______________________________
Name:____________________________
Title:___________________________
CONTRIBUTEE
SAKER ONE CORPORATION, a Utah corporation
By:______________________________
Name:____________________________
Title:___________________________
CONSENT TO TRANSFER AND ASSIGNMENT
Trinity Research, Inc., a Minnesota corporation and Xxxxxxx X. Xxxxx hereby
consent to the assignment by Contributor to Contributee of Contributor's right,
title and interest in and to the NRL Centrifuge Agreement as described above.
TRINITY RESEARCH, INC.
By:______________________________
Name:____________________________
Title:___________________________
_________________________________
Xxxxxxx X. Xxxxx
9
