EXHIBIT 10.1 - ACQUISTION AGREEMENT AND PLAN OF
REORGANIZATION BETWEEN THE XXXXX GOLD MINES AND CT
INDUSTRIES
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ACQUISITION AGREEMENT AND PLAN OF REORGANIZATION
THIS ACQUISITION AGREEMENT AND PLAN OF REORGANIZATION,
(hereinafter the "Agreement") is made and entered into this
18th day of April, 1995 by and between The Xxxxx Gold Mines,
an Idaho corporation (hereinafter "Xxxxx"), CT Industries,
Inc., a Nevada corporation (hereinafter "CTI"), and the
shareholders of CT Industries, Inc. (hereinafter
"Shareholders").
RECITALS
WHEREAS, Xxxxx desires to acquire all of the issued and
outstanding shares of CTI capital stock in exchange for
4,000,000 shares of authorized but previously unissued Xxxxx
common stock, par value One Tenth of a Cent ($.001) per
share, and pursuant to the terms and conditions set forth
herein;
WHEREAS, the Shareholders of CTI desire to exchange all
of their shares of CTI capital stock for shares of Xxxxx
common stock in the respective amounts set forth herein; and
WHEREAS, the parties hereto desire to reorganize the
management and operations of Xxxxx, to change the
corporation name to Xxxxx Industries, Inc., and to change
the principal place of business of the corporation.
NOW, THEREFORE, in consideration of the premises and
mutual representations, warranties and covenants herein
contained, the parties hereby agree as follows:
ARTICLE I
ACQUISITION AND EXCHANGE OF SHARES
SECTION 1.1 Acquisition and Plan of Reorganization. The
parties hereby agree that Xxxxx shall acquire all of the
issued and outstanding shares of M capital stock, in
exchange for four million (4,000,000) shares of authorized
but previously unissued Xxxxx common stock, par value $.001
per share. It is also agreed to by the parties hereto that
by acquiring all of the shares of CTI capital stock, Xxxxx
will acquire all rights, title and interest to certain
identified assets and property presently owned by CTI and
specifically described and set forth in Exhibit 1.1, annexed
hereto and by this reference made a part hereof. Said assets
and property may be subject to certain interests, liens
and/or encumbrances which are further described in Exhibit
1.1. The parties hereto hereby further agree that (i) at the
Closing, as hereinafter defined, CTI shall become a
wholly-owned subsidiary of Xxxxx subject to the conditions
and provisions of Section 1.5 hereof; (ii) as promptly as
practicable after the effectiveness of the Closing, Xxxxx'x
corporate name shall be changed to Xxxxx Industries, Inc.;
and (iii) as promptly as practicable after the Closing, the
necessary steps shall be taken in order to reflect the
relocation of Xxxxx'x principal place of business to Newark,
New Jersey.
SECTION 1.2 Issuance of Shares.
(a) Upon the Closing of this Agreement, Xxxxx shall
cause to be issued and delivered to the Shareholders of CTI
or their designees, stock certificates representing an
aggregate of 4,000,000 shares (the "Xxxxx Shares") of Xxxxx
common stock.
(b) The Xxxxx Shares to be issued hereunder shall be
authorized but previously unissued shares of Xxxxx common
stock, and shall be issued to those persons and in the
respective amounts set forth in Exhibit 1.2 annexed hereto
and by this reference made a part hereof.
(c) It is hereby acknowledged by the parties hereto
that pursuant to that certain Marketing Agreement entered
into by and between Xxxxx and CTI on March 13, 1995, Xxxxx
issued to CTI 100,000 shares of authorized but previously
unissued common stock of Xxxxx as consideration for the
Marketing Agreement. It is agreed upon by the parties hereto
that the 100,000 shares are to be considered as part of the
4,000,000 shares of Xxxxx common stock to be issued
hereunder and therefore upon the issuance of the additional
3,900,000 shares of Xxxxx common stock under the terms of
this Agreement, the full consideration of the 4,000,000
shares designated hereunder shall be deemed to have been
satisfied.
(d) All Xxxxx Shares to be issued hereunder are deemed
"restricted securities" as defined by Rule 144 of the
Securities Act of 1933, as amended (the "1933 Act"), and the
recipients shall represent that they are acquiring the Xxxxx
Shares for investment purposes only and without the intent
to make a further distribution of the Xxxxx Shares. All
Xxxxx Shares to be issued under the terms of this Agreement
shall be issued pursuant to an exemption from the
registration requirements of the 1933 Act, under Section
4(2) of the 1933 Act and the rules and regulations
promulgated thereunder. Certificates representing the Xxxxx
Shares to be issued hereunder shall bear the following
legend:
The shares represented by this certificate have not
been registered under the Securities Act of 1933, as
amended, and may not be offered for sale, sold or
otherwise transferred except in compliance with the
registration provisions of such Act or pursuant to
an exemption from such registration provisions, the
availability of which is to be established to the
satisfaction of the Company.
SECTION 1.3 Closing. The closing of this Agreement and
the transactions contemplated hereby (the "Closing") shall
take place on the day of ,1995 (the "Closing
Date"), at a time and place to be mutually agreed upon by
the parties hereto, and shall be subject to the provisions
of Article X of this Agreement. At the Closing:
(a) CTI shall deliver to Xxxxx all stock certificates
representing 100% of the issued and outstanding shares of
CTI capital stock, duly endorsed, so as to make Xxxxx the
sole holder thereof, free and clear of all claims and
encumbrances;
(b) Xxxxx shall deliver to those persons listed in
Exhibit 1.2 stock certificates representing an aggregate of
4,000,000 shares of Xxxxx common stock and which
certificates shall bear a standard restrictive legend in the
form customarily used with restricted securities and as set
forth in Section 1.2(d) above;
(c) Xxxxx shall deliver an Officer's Certificate as
described in Sections 9.1 and 9.2 hereof, dated the Closing
Date, that all representations, warranties, covenants and
conditions set forth herein by Xxxxx are true and correct as
of, or have been fully performed and complied with by, the
Closing Date; and
(d) CTI shall deliver an Officer's Certificate as
described in Sections 8.1 and 8.2 hereof, dated the Closing
Date, that all representations, warranties, covenants and
conditions set forth herein by CTI and Shareholders are true
and correct as of, or have been fully performed and complied
with by, the Closing Date;
SECTION 1.4 Xxxxx Special Meeting of Shareholders. In
anticipation of this Agreement and prior to the Closing
Date, Xxxxx shall have taken all necessary and requisite
action to call for a Special Meeting of Shareholders to be
held on or before April 18, 1995, in order to transact the
following business:
(a) To ratify this Agreement and all transactions
contemplated hereby;
(b) To amend the Articles of Incorporation to change
the corporate name to Xxxxx Industries, Inc., or any other
name deemed suitable by the shareholders attending the
meeting;
(c) To accept the resignation of the current directors
of the Company and to nominate and elect a new Board of
Directors consisting of the following three nominees: Xxxxxx
Xxxxxxxxxxx, Xx., Xxxxxx Xxxxx and Xxxxxx Xxxxxxxxxxx III;
(d) To amend the Articles of Incorporation to change
the authorized capitalization of the Company to 50,000,000
shares of common stock, par value $.001 per share; and
(e) To amend the Articles of Incorporation to change
the stated corporate purpose to permit the corporation to
engage in any lawful act or activity for which a corporation
may be organized under the Idaho Business Corporation Act.
SECTION 1.5 Consummation of Transaction. If at the
Closing, no condition exists which would permit any of the
parties to terminate this Agreement, or a condition then
exists and the party entitled to terminate because of that
condition elects not to do so, then the transactions herein
contemplated shall be consummated upon such date, and then
and thereupon, Xxxxx shall file any additional necessary
documents that may be required by the State of Idaho.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF XXXXX
Xxxxx hereby represents, warrants and agrees that:
SECTION 2.1 Organization of Xxxxx. Xxxxx is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Idaho, is duly
qualified and in good standing as a foreign corporation in
every jurisdiction in which such qualification is necessary,
and has the corporate power and authority to own its
properties and assets and to transact the business in which
it is engaged. There are no corporations or other entities
with respect to which (i) Xxxxx owns any of the outstanding
stock or other interest, or (ii) Xxxxx may be deemed to be
in control because of factors or relationships other that
the quantity of stock or other interest owned. Xxxxx has all
requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions
contemplated hereby. This Agreement is the legal, valid and
binding obligation of Xxxxx, enforceable against Xxxxx in
accordance with its respective terms except to the extent
that such enforcement may be limited by applicable
bankruptcy, insolvency and other similar laws affecting
creditors' rights generally.
SECTION 2.2 Capitalization of Xxxxx. The authorized
capital stock of Xxxxx consists of 10,000,000 shares of
common stock, par value $.50 per share, of which 1,029,929
shares are presently issued and outstanding. All shares of
Xxxxx common stock currently issued and outstanding have
been duly authorized and validly issued and are fully paid
and non-assessable, and have been issued in compliance with
applicable federal and state laws or pursuant to appropriate
exemptions therefrom. There are no options, warrants,
rights, calls, commitments or agreements of any character
obligating Xxxxx to issue any shares of its capital stock or
any security representing the right to purchase or otherwise
receive any such stock. Shares of Xxxxx common stock to be
issued pursuant to this Agreement, when so issued, will be
duly authorized, validly issued, fully paid and
non-assessable.
SECTION 2.3 Charter Documents. Certified copies of the
Xxxxx Articles of Incorporation and By-Laws, as amended to
date, are annexed hereto as Exhibit 2.3 and by this
reference made a part hereof.
SECTION 2.4 Corporate Documents. The Xxxxx
shareholders' list and corporate minute books are complete
and accurate as of the date hereof and the corporate minute
books contain the recorded minutes of all corporate meetings
of shareholders and directors.
SECTION 2.5 Financial Statements. Xxxxx'x financial
statements for the period ended March 31, 1995 and the
fiscal years ended December 31, 1994 and 1993, a copy of
which is annexed hereto as Exhibit 2.5 and by this reference
made a part hereof, are true and complete in all material
respects, having been prepared in accordance with generally
accepted accounting principles applied on a consistent basis
for the periods covered by such statements, and fairly
present, in accordance with generally accepted accounting
principles, the financial condition of Xxxxx, and results of
its operations for the periods covered thereby. Except as
otherwise disclosed to CTI in writing and as set forth
herein, there has been no material adverse change in the
business operations, assets, properties, prospects or
condition (financial or otherwise) of Xxxxx taken as a whole
from that reflected in the financial statements referred to
in this Section 2.5.
SECTION 2.6 Absence of Certain Changes or Events. Since
the date of the Xxxxx financial report attached hereto as
Exhibit 2.5 and except as disclosed otherwise herein, Xxxxx
has not (i) issued or sold any promissory note, stock, bond,
option or other corporate security of which it was an issuer
or other obligor, (ii) discharged or satisfied any lien or
encumbrance or paid any obligation or liability, absolute or
contingent, direct of indirect, (iii) incurred or suffered
to be incurred any liability or obligation whatsoever, (iv)
caused or permitted any lien, encumbrance or security
interest to be created or arise on or in any of its
properties or assets, (v) declared or made any dividend,
payment or distribution to stock holders or purchased or
redeemed or agreed to purchase or redeem any shares of its
capital stock, (vi) reclassified its shares of capital
stock, or (vii) entered into any agreement or transaction
except in connection with the execution and performance of
this Agreement.
SECTION 2.7 Assets and Liabilities. Xxxxx does not have
any material assets as reflected in the financial statements
included as Exhibit 2.5. As of the date hereof, Xxxxx does
not have any debts, liabilities or obligations of any
nature, whether accrued, absolute, contingent, or otherwise,
whether due or to become due, that are not fully reflected
in the Xxxxx financial statements.
SECTION 2.8 Tax Returns and Payments. Xxxxx has filed
with the appropriate governmental authority tax returns,
whether based upon income, sales or franchise, as required
by law to be filed on or before the date of this Agreement
with the exception of its federal corporate tax returns.
Xxxxx represents that immediately upon the Closing it will
prepare and file those required federal tax returns that may
be due. Xxxxx has paid all taxes to be due on said returns,
any assessments made against Xxxxx and all other taxes, fees
and similar charges imposed on Xxxxx by any governmental
authority. No tax liens have been filed and no claims are
being assessed and no returns are under audit with respect
to any such taxes, fees or other similar charges.
SECTION 2.9 Contracts. Xxxxx is not a party to or bound
by any contract or commitment, including guaranty whether
written or oral, except as otherwise disclosed in Exhibit
2.9.
SECTION 2.10 Required Authorizations. There have been
or will be timely filed, given, obtained or taken, all
applications, notices, consents, approvals, orders,
registrations, qualifications waivers or other actions of
any kind required by virtue of execution and delivery of
this Agreement by Xxxxx or the consummation by it of the
transactions contemplated hereby. Prior to the Closing, the
shareholders of Xxxxx shall have approved this Agreement and
the transactions contemplated hereunder and the appropriate
corporate filings shall have been made with the State of
Idaho.
SECTION 2.11 Compliance with Law and Government
Regulations. Xxxxx is in compliance with and is not in
violation of, applicable federal, state, local or foreign
statutes, laws and regulations (including without
limitation, any applicable building, zoning or other law,
ordinance or regulation) affecting its properties or the
operation of its business. Xxxxx is not subject to any
order, decree, judgment or other sanction of any court,
administrative agency or other tribunal.
SECTION 2.12 Litigation. There is no litigation,
arbitration, proceeding or investigation pending or
threatened to which Xxxxx is a party or which may result in
any material change in the business or condition, financial
or otherwise, of Xxxxx or in any of its properties or
assets, or which might result in any liability on the part
of Xxxxx, or which questions the validity of this Agreement
or of any action taken or to be taken pursuant to or in
connection with the provisions of this Agreement, and to the
best knowledge of Xxxxx, there is no basis for any such
litigation, arbitration, proceeding or investigation.
SECTION 2.13 Trade Names and Rights. Xxxxx does not use
any trade xxxx, service xxxx, trade name, or copyright in
its business, nor does it own any trade marks, trade xxxx
registrations or application, trade name, service marks,
copyrights, copyright registrations or application. No
person owns any trade xxxx, trade xxxx registration or
application, service xxxx, trade name, copyright, or
copyright registration or application, the use of which is
necessary or contemplated in connection with the operation
of Xxxxx'x business.
SECTION 2.14 Governmental Consent. No consent,
approval, authorization or order of, or registration,
qualification, designation, declaration or filing with, any
governmental authority on the part of Xxxxx is required in
connection with the execution and delivery of this Agreement
or the carrying out of any transactions contemplated hereby
with the exception of the necessary corporate filings with
the State of Idaho relating to the amendment of the Articles
of Incorporation and the proposed exchange of shares.
SECTION 2.15 Authority. Xxxxx and its shareholders
will, prior to the Closing, approve this Agreement and the
transactions contemplated hereby and will duly authorize the
execution and delivery hereof. Xxxxx has full power,
authority and legal right to enter into this Agreement and
to consummate the transactions contemplated hereby, and all
corporate action necessary to authorize the execution and
delivery of this Agreement and the consummation of the
transactions contemplated hereby has been duly and validly
taken. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and
compliance by Xxxxx with the provisions hereof will not (a)
conflict with or result in a breach of any provisions of, or
constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, or
result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets
of Xxxxx under, any of the terms, conditions or provisions
of the Articles of Incorporation or By-Laws of Xxxxx, or any
note, bond, mortgage, indenture, license, lease, agreement
or any instrument or obligation to which Xxxxx is a party or
by which it is bound; or (b) violate any order, writ,
injunction, decree, statute, rule or regulation applicable
to Xxxxx or any of its properties or assets.
SECTION 2.16 Full Disclosure. None of the
representations and warranties made by Xxxxx herein, or in
any exhibit, certificate or memorandum furnished or to be
furnished by Xxxxx, on its behalf pursuant hereto, contains
or will contain any untrue statement of material fact, or
omits any material fact, the omission of which would be
misleading.
ARTICLE III
COVENANTS OF XXXXX
SECTION 3.1 Conduct Prior to the Closing. Between the
date hereof and the Closing:
(a) Xxxxx will not enter into any material
agreement, contract or commitment, whether written or oral,
or engage in any transaction, without the prior written
consent of CTI;
(b) Xxxxx will not declare any dividends or
distributions with respect to its capital stock or amend its
Articles of Incorporation or By-Laws, without the prior
written consent of CTI;
(c) Xxxxx will not authorize, issue, sell, purchase
or redeem any shares of its capital stock or any options or
other rights to acquire its capital stock, without the prior
written consent of CTI;
(d) Xxxxx will comply with all requirements which
federal or state law may impose on it with respect to this
Agreement and the transactions contemplated hereby, and will
promptly cooperate with and furnish written information to
CTI in connection with any such requirements imposed upon
the parties hereto in connection therewith;
(e) Xxxxx will not incur any indebtedness for money
borrowed, or issue or sell any debt securities, incur or
suffer to be incurred any liability or obligation of any
nature whatsoever, or cause or permit any lien, encumbrance
or security interest to be created or arise on or in any of
its properties or assets, acquire or dispose of fixed
assets, change employment terms, enter into any material or
long-term contract, guarantee obligations of any third
party, settle or discharge any balance sheet receivable for
less than its stated amount or enter into any other
transaction other than in the regular course of business,
except to comply with the terms of this Agreement, without
the prior written consent of CTI;
(f) Xxxxx shall grant to CTI and its counsel,
accountants and other representatives, full access during
normal business hours during the period prior to the Closing
to all its respective properties, books, contracts,
commitments and records and, during such period, furnish
promptly to CTI and such representatives all information
relating to Xxxxx as CTI may reasonably request, and shall
extend to CTI the opportunity to meet with Xxxxx'x
accountants and attorneys to discuss the financial condition
of Xxxxx; and
(g) Except for the transactions contemplated by this
Agreement, Xxxxx will conduct its business in the normal
course, and shall not sell, pledge or assign any of its
assets without the prior written consent of CTI.
SECTION 3.2 Affirmative Covenants. Prior to Closing,
Xxxxx will do the following.
(a) Use its best efforts to accomplish all actions
necessary to consummate this Agreement, including
satisfaction of all the conditions contained in this
Agreement;
(b) Promptly notify CTI in writing of any material
adverse change in the financial condition, business,
operations or key personnel of Xxxxx, any threatened
material litigation or investigation, any breach of its
representations or warranties contained herein, and any
material contract, agreement, license or other agreement
which, if in effect on the date of this Agreement, should
have been included in this Agreement or in an exhibit
annexed hereto and made a part hereof;
(c) Obtain approval of this Agreement from its
shareholders;
(d) Nominate at the Xxxxx Special Meeting of
Shareholders a new Board of Directors, nominees to be Xxxxxx
Xxxxxxxxxxx, Xx., Xxxxxx Xxxxx and Xxxxxx Xxxxxxxxxxx III;
(e) Reserve, and promptly after the Closing, issue
and deliver to Shareholders or their designees the number of
shares of Xxxxx common stock required hereunder;
(f) Take the necessary corporate action to amend
its Articles of Incorporation to change its name to Xxxxx
Industries, Inc. or any other name deemed suitable and
approved by the shareholders; and
(g) Take all other necessary corporate actions to
accomplish those items set forth in Section 1.4 hereof.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF CTI AND SHAREHOLDERS
CTI and Shareholders hereby represent, warrant and
agree that:
SECTION 4.1 Organization of CTI. CTI is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada and is duly
qualified and in good standing in every jurisdiction in
which such qualification is necessary. There are no
corporations or other entities with respect to which (i) CTI
owns any of the outstanding stock or other interest, or (ii)
CTI may be deemed to be in control because of factors or
relationships other than the percentage of outstanding stock
or other interest owned in such entity except as otherwise
disclosed in Exhibit 4.1 annexed hereto and by this
reference made a part hereof. CTI has all requisite
corporate power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby.
SECTION 4.2 Charter Documents. Complete and correct
copies of the Articles of Incorporation and By-Laws of CTI
and all amendments thereto, have been or will be delivered
to Xxxxx prior to the Closing.
SECTION 4.3 Financial Statements / Assets and
Liabilities. CTI's financial statements for the period ended
December 31, 1994, a copy of which is annexed hereto as
Exhibit 4.3 and by this reference made a part hereof; are
true and complete in all material respects, having been
prepared in accordance with generally accepted accounting
principles applied on a consistent basis for the periods
covered by such statements, and fairly present the financial
condition of CTI and results of its operations for the
periods covered thereby. CTI has good and marketable title
to all of its assets and property to be delivered to Xxxxx
hereunder (by way of tendering all of its outstanding shares
of common stock to Xxxxx), free and clear of any and all
liens, claims and encumbrances, except as may be otherwise
set forth herein and in its financial statements or as
otherwise set forth in Exhibit 1.1.
SECTION 4.4 Tax Returns and Payments. All of CTI's
tax returns (federal, state, city, county or foreign) which
are required by law to be filed on or before the date of
this Agreement, have been duly filed or extended with the
appropriate governmental authority. CTI has paid all taxes
to be due on said returns, any assessments made against CTI
and all other taxes, fees and similar charges imposed on CTI
by any governmental authority (other than those, the amount
or validity of which is being contested in good faith by
appropriate proceedings). No tax liens have been filed and
no claims are being assessed with respect to any such taxes,
fees or other similar charges.
SECTION 4.5 Required Authorizations. There have
been or will be timely filed, given, obtained or taken, all
applications, notices, consents, approvals, orders,
registrations, qualifications waivers or other actions of
any kind required by virtue of execution and delivery of
this Agreement by CTI or the consummation by it of the
transactions contemplated hereby.
SECTION 4.6 Compliance with Law and Government
Regulations. CTI is in compliance with all applicable
statutes, regulations, decrees, orders, restrictions,
guidelines and standards affecting its properties and
operations, imposed by the United States of America or any
state to which CTI is subject.
SECTION 4.7 Litigation. There is no material
litigation, arbitration, proceeding or investigation pending
or threatened to which it is a party or which may result in
any material change in the business or condition, financial
or otherwise, of CTI or in any of its properties or assets,
or which if determined against CTI would have a material
adverse effect against CTI, or which might result in any
liability on the part of CTI, or which questions the
validity of this Agreement or of any action taken or to be
taken pursuant to or in connection with the provisions of
this Agreement, and to the best knowledge of CTI, there is
no basis for any such litigation, arbitration, proceeding or
investigation.
SECTION 4.8 Patents, Trade Names and Rights
Exhibit 4.8 annexed hereto and by this reference made a part
hereof, contains a complete list of all patents, trademarks,
service marks, trademark and service xxxx registrations,
applications and licenses with respect to the foregoing
owned or held by M. CTI has no knowledge of any facts and
nothing has come to its attention that would lead it to
believe that it has infringed or misappropriated or is
infringing upon any trademark, copyright, patent or other
similar right of any person. No claim relating thereto is
pending or to the knowledge of CTI is threatened.
SECTION 4.9 Governmental Consent. No consent,
approval, authorization or order of, or registration,
qualification, designation, declaration or filing with, any
governmental authority on the part of CTI is required in
connection with the execution and delivery of this Agreement
or the carrying out of any transactions contemplated hereby.
SECTION 4.10 Authority . CTI and its Shareholders
representing no less than one hundred percent (100%) of the
issued and outstanding shares of CTI capital stock of
record, have approved this Agreement and duly authorized the
execution and delivery hereof. CTI has full power, authority
and legal right to enter into this Agreement on behalf of
CTI and its Shareholders and to consummate the transactions
contemplated hereby, and all corporate action necessary to
authorize the execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby has
been duly and validly taken. The execution and delivery of
this Agreement, the consummation of the transactions
contemplated hereby and compliance by CTI with the
provisions hereof will not (a) conflict with or result in a
breach of any provisions of, or constitute a default (or an
event which, with notice or lapse of time or both, would
constitute a default) under, or result in the creation of
any lien, security interest, charge or encumbrance upon any
of the properties or assets of CTI under, any of the terms,
conditions or provisions of the Articles of Incorporation or
By-Laws of CTI, or any note, bond, mortgage, indenture,
license, agreement or any instrument or obligation to which
CTI is party or by which it is bound; or (b) violate any
order, writ, injunction, decree, statute, rule or regulation
applicable to CTI or any of its properties or assets.
SECTION 4.11 Ownership of Shares. Shareholders
representing 100% of the CTI capital stock currently issued
and outstanding and which stock is to be transferred to
Xxxxx under this Agreement, have full power and authority to
transfer such shares of CTI capital stock to Xxxxx
hereunder, and such shares are free and clear of any liens,
charges, mortgages, pledges or encumbrances and such shares
are not subject to any claims as to the ownership thereof or
any rights, powers or interest therein, by any third party.
SECTION 4.12 Investment Purpose . CTI and
Shareholders represent that the recipients of the Xxxxx
Shares hereunder are acquiring the shares for investment
purposes only and acknowledges that the Auger Shares issued
hereunder are "restricted securities" and may not be sold,
traded or otherwise transferred without registration under
the 1933 Act or exemption therefrom.
SECTION 4.13 Full Disclosure. None of the
representations and warranties made by CTI and Shareholders
herein, or in any exhibit, certificate or memorandum
furnished or to be furnished by Xxxxx, on its behalf
contains or will contain any untrue statement of material
fact, or omit any material fact, the omission of which would
be misleading.
ARTICLE V
COVENANTS OF CTI
SECTION 5.1 Conduct Prior to the Closing. Between
the date hereof and the Closing:
(a) Except within the regular course of business,
CTI will not enter into any material agreement, contract or
commitment, whether written or oral, or engage in any
transaction, without the consent of Xxxxx;
(b) CTI will not declare any dividends or
distributions with respect to its capital stock or amend its
Articles of Incorporation or By-Laws, without the prior
consent of Xxxxx;
(c) Except within the regular course of business,
CTI will not incur any indebtedness for money borrowed or
issue any debt securities, or incur or suffer to be incurred
any liability or obligation of any nature whatsoever, or
cause or permit any lien, encumbrance or security interest
to be created or arise on or in any of its properties or
assets, without the consent of Xxxxx;
(d) CTI will comply with all requirements which
federal or state law may impose on it with respect to this
Agreement and the transactions contemplated hereby, and will
promptly cooperate with and furnish information to Xxxxx in
connection with any such requirements imposed upon the
parties hereto in connection therewith; and
(e) CTI shall grant to Xxxxx and its counsel,
accountants and other representatives, full access during
normal business hours during the period prior to the Closing
to all its respective properties, books, contracts,
commitments and records and, during such period, furnish
promptly to Xxxxx and such representatives all information
relating to CTI as Xxxxx may reasonably request, and shall
extend to Xxxxx the opportunity to meet with CTI's
accountants and attorneys to discuss the financial condition
of CTI.
SECTION 5.2 Affirmative Covenants. Prior to
Closing, CTI will do the following.
(a) Obtain the approval of its Board of Directors
and Shareholders to proceed with this Agreement;
(b) Use its best efforts to accomplish all actions
necessary to consummate this Agreement, including
satisfaction of all the conditions contained in this
Agreement; and
(c) Promptly notify Xxxxx in writing of any
materially adverse change in the financial condition,
business, operations or key personnel of CTI, any breach of
its representations or warranties contained herein, and any
material contract, agreement, license or other agreement
which, if in effect on the date of this Agreement, should
have been included in this Agreement.
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION 6.1 Expenses. Whether or not the
transactions contemplated in this Agreement are consummated,
all costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expense or as otherwise
agreed to herein.
SECTION 6.2 Brokers and Finders. Each of the
parties hereto represents, as to itself, that no agent,
broker, investment banker or firm or person is or will be
entitled to any broker's or finder's fee or any other
commission or similar fee in connection with any of the
transactions contemplated by this Agreement.
SECTION 6.3 Necessary Actions. Subject to the terms
and conditions herein provided, each of the parties hereto
agree to use all reasonable efforts to take, or cause to be
taken, all action, and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws
and regulations to consummate and make effective the
transactions contemplated by this Agreement. In the event at
any time after the Closing, any further action is necessary
or desirable to carry out the purposes of this Agreement,
the proper officers and/or directors of Xxxxx or CTI, as the
case may be, shall take all such necessary action.
SECTION 6.4 Indemnification.
(a) CTI and Shareholders agree to defend and hold Auger
harmless against and in respect of any and all claims,
demands, losses, costs, expenses, obligations, liabilities,
damages, recoveries and deficiencies, including interest,
penalties, and reasonable attorney fees, that Xxxxx shall
incur or suffer, which arise out of, result from or relate
to any material breach of, or failure by CTI and/or
Shareholders to perform any of its representations,
warranties, covenants and agreements in this Agreement or in
any exhibit or other instrument furnished or to be furnished
by CTI and Shareholders under this Agreement.
(b) Xxxxx agrees to defend and hold CTI and
Shareholders harmless against and in respect of any and all
claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries and deficiencies, including
interest, penalties, and reasonable attorney fees, that CTI
and/or Shareholders shall incur or suffer, which arise out
of, result from or relate to any material breach of, or
failure by Xxxxx to perform any of its representations,
warranties, covenants and agreements in this Agreement or in
any exhibit or other instrument furnished or to be furnished
by Xxxxx under this Agreement.
SECTION 6.5 Confidentiality. All parties hereto
agree to keep confidential this Agreement and all
information and documents relating to this Agreement until
such time as the Agreement and the transactions contemplated
hereunder are made public by means of an appropriate press
release or by any other means reasonably assured to make
such information publicly available.
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF TIE PARTIES
The obligations of the parties under this Agreement are
subject to the fulfillment and satisfaction of each of the
following conditions:
SECTION 7.1 Legal Action. No preliminary or
permanent injunction or other order by any federal or state
court which prevents the consummation of this Agreement or
any of the transactions contemplated by this Agreement shall
have been issued and remain in effect.
SECTION 7.2 Absence of Termination. The obligations
to consummate the transactions contemplated hereby shall not
have been canceled pursuant to Article X hereof.
SECTION 7.3 Required Approvals. Auger and CTI shall
have received all such approvals, consents, authorizations
or modifications as may be required to permit the
performance by Xxxxx and C77 of the respective obligations
under this Agreement, and the consummation of the
transactions herein contemplated, whether from governmental
authorities or other persons, and Xxxxx and CTI shall each
have received any and all permits and approvals from any
regulatory authority having jurisdiction required for the
lawful consummation of this Agreement.
SECTION 7.4 Blue Sky Compliance. There shall have
been obtained any and all permits, approvals and consents of
the Securities or "Blue Sky" Commissions of any
jurisdictions, and of any other governmental body or agency,
which counsel for Xxxxx may reasonably deem necessary or
appropriate so that consummation of the transactions
contemplated by this Agreement may be in compliance with all
applicable laws.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF XXXXX
All obligations of Xxxxx under this Agreement are
subject to the fulfillment and satisfaction by CTI and
Shareholders prior to or at the time of the Closing, of each
of the following conditions, any one or more of which may be
waived by Xxxxx.
SECTION 8.1 Representations and Warranties True at
the Closing. All representations and warranties of CTI and
Shareholders contained in this Agreement will be true and
correct at and as of the time of the Closing, and CTI and
Shareholders shall have delivered to Xxxxx certificates,
dated the date of the Closing, to such effect and in the
form and substance satisfactory to Xxxxx, and signed, in the
case of CTI, by its president and secretary.
SECTION 8.2 Performance. The obligations of CTI and
Shareholders to be performed on or before the Closing
pursuant to the terms of this Agreement shall have been duly
performed at such time, and CTI and Shareholders shall have
delivered to Xxxxx a certificate, dated the date of the
Closing, to such effect and in form and substance
satisfactory to Xxxxx.
SECTION 8.3 Authority. All action required to be
taken by, or on the part of CTI and its Shareholders to
authorize the execution, delivery and performance of this
Agreement by CTI and Shareholders and the consummation of
the transactions contemplated hereby, shall have been duly
and validly taken.
SECTION 8.4 Absence of Certain Changes or Events.
There shall not have occurred, since the date hereof' any
adverse change in the business, condition, (financial or
otherwise), assets or liabilities of CTI or any event or
condition of any character adversely affecting CTI, and it
shall have delivered to Xxxxx, certificates, dated the date
of the Closing, to such effect and in form and substance
satisfactory to Xxxxx and signed, in the case of CTI, by its
president and secretary.
SECTION 8.5 Acceptance by CTI Shareholders. The
holders of record as of the Closing of an aggregate of not
less than one hundred percent (100%) of the issued and
outstanding shares of capital stock of CTI have agreed to
exchange their shares for the Xxxxx Shares specified herein.
ARTICLE IX
CONDITIONS PRECEDENT TO OBLIGATIONS OF CTI
All obligations of CTI and Shareholders under this
Agreement are subject to the fulfillment and satisfaction by
Xxxxx, prior to or at the time of Closing, of each of the
following conditions, any one or more of which may be waived
by CTI and Shareholders.
SECTION 9.1 Representations and Warranties True at
the Closing. All representations and warranties of Xxxxx
contained in this Agreement will be true and correct at and
as of the time of the Closing, and Xxxxx shall have
delivered to CTI a certificate, dated the date of the
Closing, to such effect and in the form and substance
satisfactory to CTI and Shareholders, and signed, in the
case of Xxxxx, by its president and secretary.
SECTION 9.2 Performance. Each of the obligations of
Xxxxx to be performed on or before the Closing pursuant to
the terms of this Agreement shall have been duly performed
at the time of the Closing, and Xxxxx shall have delivered
to CTI a certificate, dated the date of the Closing, to such
effect and in form and substance satisfactory to CTI and
Shareholders, and signed, in the case of Xxxxx, by its
president and secretary.
SECTION 9.3 Authority. All action required to be
taken by, or on the part of Xxxxx, to authorize the
execution, delivery and performance of this Agreement by
Xxxxx, and the consummation of the transactions contemplated
hereby shall be duly and validly taken.
SECTION 9.4 Absence of Certain Chances or Events.
There shall not have occurred, since the date hereof, any
adverse change in the business, condition, (financial or
otherwise), assets or liabilities of Xxxxx or any event or
condition of any character adversely affecting Xxxxx and it
shall have delivered to CTI, certificates, dated the date of
the Closing, to such effect and in form and substance
satisfactory to CTI and Shareholders and signed, in the case
of Xxxxx, by its president and secretary.
SECTION 9.5 Action by Xxxxx Shareholders. Prior to
the Closing of this Agreement, the shareholders of Xxxxx
shall have approved this Agreement and the transactions
contemplated hereunder, approved the amendments to the Xxxxx
Articles of Incorporation as set forth in Section 1.4 above,
and shall have elected new directors as specified in Section
1.4(d) above. The current directors and officers of Xxxxx
shall have submitted their resignations as directors and
officers of Xxxxx effective on the Closing of this
Agreement.
ARTICLE X
TERMINATION
SECTION 10.1 Termination. Notwithstanding anything
herein or elsewhere to the contrary, this Agreement may be
terminated:
(a) By mutual agreement of all the parties hereto at
any time;
(b) By the board of directors of Xxxxx at any time
prior to the Closing if
(i) a condition to performance by Xxxxx under
this Agreement or a covenant of CTI and/or Shareholders
contained herein shall not be fulfilled on or before the
time of the Closing or at such other time and date specified
for the fulfillment for such covenant or condition; or
(ii) a material default or breach of this
Agreement shall be made by CTI; or
(iii) if the Closing shall not have taken place
on or prior to May 31, 1995.
(c) By the board of directors of CTI at any time
prior to the Closing if
(i) a condition to CTI's and Shareholders'
performance under this Agreement or a covenant of Xxxxx
contained in this Agreement shall not be fulfilled on or
before the Closing or at such other time and date specified
for the fulfillment of such covenant or conditions;
(ii) a material default or breach of this
Agreement shall be made by Auger; or
(iii) if the Closing shall not have taken place
on or prior to May 31, 1995.
SECTION 10.2 Effect of Termination. If this
Agreement is terminated, this Agreement, except as to
Section 11.1 and Section 11.2, shall no longer be of any
force or effect and there shall be no liability on the part
of any party or its respective directors, officers or
stockholders; provided however, that in the case of a
Termination without cause by a party or a termination
pursuant to Sections 10.1(b)(i) or 10.1(c)(i) hereof because
of a prior material default under or a material breach of
this Agreement by another party, the damages which the
aggrieved party or parties may recover from the defaulting
party or parties shall in no event exceed the amount of
out-of-pocket costs and expenses incurred by such aggravated
party or parties in connection with this Agreement, and no
party to this Agreement shall be entitled to any injunctive
relief.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Cost and Expenses. All costs and
expenses incurred in connection with this Agreement will be
paid by the party incurring such expenses. In the event of
any termination of this Agreement pursuant to Section 10.1,
subject to the provisions of Section 10.2, Xxxxx and CTI
will each bear their own respective expenses.
SECTION 11.2 Extension of Time: Waivers. At any time
prior to the Closing date:
(a) Xxxxx may (i) extend the time for the
performance of any of the obligations or other acts of CTI
and/or Shareholders, (ii) waive any inaccuracies in the
representations and warranties of CTI and Shareholders
contained herein or in any document delivered pursuant
hereto by CTI and Shareholders, and (iii) waive compliance
with any of the agreements or conditions contained herein to
be performed by CTI and Shareholders. Any agreement on the
part of Xxxxx to any such extension or waiver shall be valid
only if set forth in an instrument, in writing, signed on
behalf of Xxxxx;
(b) CTI may (i) extend the time for the performance of
any of the obligations or other acts of Xxxxx, (ii) waive
any inaccuracies in the representations and warranties of
Xxxxx contained herein or in any document delivered pursuant
hereto by Xxxxx and (iii) waive compliance with any of the
agreements or conditions contained herein to be performed by
Xxxxx. Any agreement on the part of CTI and to any such
extension or waiver shall be valid only if set forth in an
instrument, in writing, signed on behalf of CTI.
SECTION 11.3 Notices. Any notice to any party
hereto pursuant to this Agreement shall be in writing and
given by Certified or Registered Mail or by facsimile,
addressed as follows:
The Auger Gold Mines
c/o Xxxxxxx X. Xxxxxxx
Attorney at Law
1121 East 0000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
CT Industries, Inc.
X.X. Xxx 00000
Xxxxxx, Xxx Xxxxxx 00000-0000
Additional notices are to be given as to each party, at
such other address as should be designated in writing
complying as to delivery with the terms of this Section
11.3. All such notices shall be effective when sent,
addressed as aforesaid.
SECTION 11.4 Parties in Interest. This Agreement
shall inure to the benefit of and be binding upon the
parties hereto and the respective successors and assigns.
Nothing in this Agreement is intended to confer, expressly
or by implication, upon any other person any rights or
remedies under or by reason of this Agreement.
SECTION 11.5 Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall be
deemed an original and together shall constitute one
document. The delivery by facsimile of an executed
counterpart of this Agreement shall be deemed to be an
original and shall have the full force and effect of an
original executed copy.
SECTION 11.6 Severability. The parties hereto agree
and affirm that none of the provisions herein is dependent
upon the validity of any other provision, and if any part of
this Agreement is deemed to be unenforceable, the remainder
of the Agreement shall remain in full force and effect.
SECTION 11.7 Headings. The Article and Section
headings are provided herein for convenience of reference
only and do not constitute a part of this Agreement.
SECTION 11.8 Governing Law. This Agreement shall be
governed by the laws of the State of Utah.
SECTION 11.9 Survival of Representations and
Warranties. All terms, conditions, representations and
warranties set forth in this Agreement or in any instrument,
certificate, opinion, or other writing providing for in it,
shall survive the Closing and the delivery of the Xxxxx
Shares issued hereunder at the Closing, for a period of one
year from the Closing regardless of any investigation made
by or on behalf of any of the parties hereto.
SECTION 11.10 Assignability. This Agreement shall
not be assignable by any of the parties hereto without the
prior written consent of the other parties.
SECTION 11.11 Amendment. This Agreement may be
amended with the approval of Shareholders and the boards of
directors of Xxxxx and C77 at any time before or after
approval thereof by stockholders of Xxxxx, if required, and
CTI; but after such approval by the Xxxxx shareholders, no
amendment shall be made which substantially and adversely
changes the terms hereof. This Agreement may not be amended
except by an instrument, in writing, signed on behalf of
each of the parties 'hereto.
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement in a manner legally binding upon
them as of the date first above written.
"Xxxxx"
THE XXXXX GOLD MINES Attest:
By:
Its: President Secretary
"CTI"
CT INDUSTRIES, INC.
By: (s) Xxxxxx Xxxxxxxxxxx (s) Xxxxxx Xxxxx
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President Secretary
"Shareholders"
(s) Xxxxxx Xxxxxxxxxxx
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XXXXXX XXXXXXXXXXX, XX.
(s) Xxxxxx Xxxxx
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XXXXXX XXXXX
