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EXHIBIT 3.1
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made and entered into
this 7th day of January, 1997 by and among the following parties: U.S.
Technologies, Inc., a Delaware corporation (the "Company"); Tintagel, Ltd., a
Turks & Caicos Islands Trust ("Tintagel"); Komen Holdings Pty., Ltd., an
Australian corporation ("Komen") (Tintagel and Komen are collectively referred
to herein as the "Sellers" and individually, a "Seller"); and GWP, Inc., a
Georgia corporation (the "Purchaser").
Recitals
The Sellers own 9,169,000 shares of the common stock of the Company. The
Sellers desire to sell such shares to the Purchaser and the Purchaser desires
to purchase such shares from the Sellers, all as herein provided and on the
terms and conditions hereinafter set forth. The Company consents to the sale of
such shares.
Covenants
In consideration of the representations, warranties and covenants and
subject to the conditions herein contained, the parties hereto agree as
follows:
ARTICLE 1
PURCHASE AND SALE OF THE SHARES
1.1 PURCHASE AND SALE. Each of the Sellers will sell, transfer, assign
and deliver to the Purchaser at the Closing (as defined below), free and clear
of all liens, pledges, encumbrances, claims, equities and contractual
restrictions on transfers of every kind, and the Purchaser will purchase and
accept from each of the Sellers, on the terms and subject to the conditions set
forth in this Agreement, all of the issued and outstanding shares of common
stock of the Company owned by the Sellers (collectively the "Shares").
1.2 AMOUNT OF THE PURCHASE PRICE. As consideration for the Shares (the
"Purchase Price"), the Purchaser agrees, subject to the terms, conditions and
limitations set forth in this Agreement, to pay to or for the account of the
Sellers, in the manner specified in Section 1.4 hereof, an amount equal to nine
hundred thirty seven thousand dollars (U.S.) ($937,000), allocated among the
respective Sellers as follows:
Tintagel - $437,000
Komen - $500,000
1.3 TIME AND PLACE OF THE CLOSING. The closing of the purchase and sale
of the Shares shall take place at the offices of Xxxxxxxx Xxxxxxxx Xxxxx &
Xxxxx, 000 Xxxxxxxxx Xxxxxx, X.X.,
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Xxxxx 0000, Xxxxxxx, XX 00000, at 10:00 A.M., local time, on or before April 7,
1997; provided, however, that if any of the conditions which are set forth in
Articles 7 and 8 of this Agreement has not been satisfied (or waived) by said
date, then the closing shall take place on a subsequent date which shall be
determined by the mutual agreement of the Purchaser and the Sellers. Throughout
this Agreement, such event is referred to as the "Closing" and such date and
time are referred to as the "Closing Date."
1.4 PROCEDURE AT THE CLOSING. At the Closing. the parties agree to
take the following steps in the order listed below (provided, however, that upon
their completion all such steps shall be deemed to have occurred
simultaneously):
(a) The Company and the Sellers shall deliver to the Purchaser
evidence, in such form as in each case is reasonably satisfactory to the
Purchaser, that each of the conditions to the obligation of the Purchaser to
purchase the Shares from the Sellers which is set forth in Article 7 of this
Agreement has been satisfied;
(b) The Purchaser shall deliver to the Sellers evidence, in such
form as in each case is reasonably satisfactory to each of the Sellers, that
each of the conditions to the obligations of the Sellers to sell the Shares to
the Purchaser which is set forth in Article 8 of this Agreement has been
satisfied;
(c) Each of the Sellers shall deliver to the Purchaser duly
executed certificates in valid form evidencing the Shares owned by such Seller,
duly endorsed in blank or accompanied by duly executed stock powers in form
reasonably acceptable to Purchaser;
(d) The Purchaser shall deliver to each of the Sellers a
promissory note in the amounts set forth in Schedule 1.2 which note shall be in
the form of Exhibit A attached hereto accompanied by a stock purchase warrant
which shall be in the form of Exhibit B attached hereto and secured by a
Collateral Assignment and Security Agreement in the form of Exhibit C attached
hereto; and
(e) The Purchaser and the Sellers shall execute and deliver a
cross receipt acknowledging receipt from the other, respectively, of the Shares
and the Purchase Price.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
In order to induce the Purchaser to enter into this Agreement and to
consummate the transactions contemplated hereunder, each of the Sellers
severally (and not jointly) makes the following representations and warranties
with respect to such Seller and his or its Shares.
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2.1 STATUS AND EFFECT OF DELIVERY OF THE SHARES. The Seller is the legal
and beneficial owner of the Shares described as owned by it in Schedule 2.1 and
has valid marketable title thereto, free and clear of all liens, pledges,
encumbrances, claims, equities, any rights of co-sale, and contractual
restrictions on transfer of every kind. There are no outstanding warrants,
options or rights of any kind to acquire from the Seller any of such Shares.
Delivery of such Shares by the Seller to the Purchaser in accordance with this
Agreement will vest title to all such Shares in the Purchaser, free and clear
of any liens, pledges, encumbrances, claims, equities and contractual
restrictions on transfers of every kind granted by the Seller or arising from
the Seller's ownership of such Shares. A true copy of each share certificate
evidencing such Shares is attached to this Agreement as part of Exhibit D.
2.2 BINDING OBLIGATION. This Agreement has been duly executed and
delivered by the Seller and is a valid and binding obligation of the Seller,
enforceable in accordance with its terms. If the Seller is a corporation, such
Seller has taken all requisite corporate action to authorize the execution of
this Agreement and the consummation of the transactions contemplated hereby.
Neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby will: (i) conflict with or violate any
provision of any law, ordinance or regulation or any decree or order of any
court or administrative or other governmental body which is either applicable
to, binding upon or enforceable against the Seller, (ii) result in any breach
of or default under any mortgage, contract, agreement, indenture, will, trust
or other instrument which is either binding upon or enforceable against the
Seller, or (iii) require any additional consents or approvals except as may be
otherwise provided for in this Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
In order to induce the Purchaser to enter into this Agreement and to
consummate the transactions contemplated hereunder, the Company makes the
following representations and warranties.
3.1 ORGANIZATION, POWER AND AUTHORITY OF THE COMPANY. The Company is a
corporation duly organized and legally existing in good standing under the laws
of Delaware, and has full corporate power and authority necessary to own or
lease its properties and to carry on its business as it is now being conducted,
to enter into this Agreement and to carry out the transactions contemplated
hereby. The Company is duly qualified to do business and is in good standing as
a foreign corporation in Texas and is not transacting business in any other
state where the failure to so qualify would have a material adverse affect on
the business or financial condition of the Company.
3.2 CAPITAL STOCK OF THE COMPANY. The authorized capital stock of the
Company consists solely of 50,000,000 shares consisting of 40,000,000 shares of
common stock,
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21,957,263 of which are issued and outstanding and 10,000,000 shares of
preferred stock none of which are issued and outstanding. No shares of the
Company's capital stock is issued and held in its treasury. All of the issued
and outstanding shares of capital stock of the Company are validly authorized
and issued, fully paid and non-assessable. Shareholders of the Company do not
have preemptive rights. Attached hereto is a Schedule 3.2 which describes
outstanding options, warrants, and other convertible instruments. No dividends
or other distributions have been made to any of the Sellers with respect to the
Shares except as permitted by the corporate laws of the State of Delaware.
3.3 SUBSIDIARIES OF THE COMPANY. The Company has no equity interest or
right or obligation to acquire an equity interest in any other person or entity
other than (i) Newdat, Inc., an Arizona corporation and wholly-owned subsidiary
of the Company, which is a corporation duly organized, legally existing and in
good standing under the laws of the State of Arizona; (ii) Xxxxxxxx Technology,
Inc., an Arizona corporation and wholly-owned subsidiary of the Company, which
is a corporation duly organized, legally existing and in good standing under
the laws of the State of Arizona; and (iii) Sensoncorp, Ltd., an Arizona
corporation of which the Company holds a eighty percent (80%) interest and is a
corporation duly organized, legally existing and in good standing under the
laws of the State of Arizona.
3.4 FINANCIAL STATEMENTS OF THE COMPANY. The Company has previously
delivered to the Purchaser the following financial statements of the Company:
(a) audited balance sheets as of the last day of each of the fiscal
years ended in December 1994 and 1995;
(b) audited statements of income and retained earnings and changes
in financial position for each of the fiscal years ended in December 1994 and
1995;
(c) unaudited financial statements for the first three quarters of
1996 as contained in the Company's Form 10-Qs as filed with the Securities and
Exchange Commission; and
(d) unaudited, internally prepared financial information dated as of
November 31, 1996.
Such financial statements are true and correct in all material respects,
present fairly the financial position of the Company at each of the said
balance sheet dates and the results of its operations for each of the said
periods covered and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis except as may be disclosed
in the auditors' reports thereon or the notes thereto. Except as provided in
Schedule 3.4, there have been no adverse material changes in the financial
position of the Company since November 31, 1996.
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3.5 LITIGATION INVOLVING THE COMPANY. There are no actions, suits,
claims, governmental investigations or arbitration proceedings pending or, to
the knowledge of Company, threatened against the Company or any of its assets
or properties except as set forth in Schedule 3.5 attached. There are no
outstanding orders, decrees or stipulations issued by any local, state or
federal judicial authority in any proceeding to which the Company is or was a
party which adversely affect the assets, properties, business, financial
condition or results of operations of the Company.
3.6 RECORDS OF THE COMPANY. The Company has previously furnished the
Purchaser with copies of the Company's articles of incorporation and all
amendments thereto to date (certified by the Secretary of State of Delaware)
and of the Company's bylaws (certified by the Company's secretary) and such
copies are correct and complete in all respects. The Company has provided
Purchaser an opportunity to review all of the Company's minute books and stock
ledgers. A record of all action taken by the shareholders and the board of
directors of the Company and all minutes of their meetings, since September 9,
1986, are contained in the minute books of the Company and are materially
accurate and complete. The stock ledgers of the Company contain an accurate and
complete record of all issuances and cancellations of shares of capital stock
of the Company and warrants and options for capital stock of the Company since
December 31, 1995.
3.7 COMPLIANCE WITH LAWS BY THE COMPANY. The Company is in material
compliance with all laws, regulations and orders applicable to the Company, its
assets, properties and business. To the knowledge of Company, the Company is
not under investigation regarding, and has not been charged or threatened with,
and has received no notice with respect to, any claim or charge of, or
investigation regarding, any failure to comply with or violation of any such
applicable law, rule, regulation, code, approval, license, order, writ, decree,
injunction or other governmental restriction.
3.8 BINDING OBLIGATION. This Agreement has been duly executed and
delivered by the Company and is a valid and binding obligation of the Company,
enforceable in accordance with its terms. Neither the execution or delivery of
this Agreement nor the consummation of the transactions contemplated hereby
will (i) conflict with or violate any provisions of the articles of
incorporation or bylaws of the Company or any law, ordinance or regulation or
any decree or order of any court or administrative or other governmental body
that is either applicable to, binding upon or enforceable against the Company,
(ii) result in any breach of or default under any mortgage, contract,
agreement, indenture or other instrument that is either binding upon or
enforceable against the Company, or (iii) require any additional consents or
approvals except as may be otherwise provided for in this Agreement.
3.9 CONSENTS. The execution, delivery and performance of this Agreement
by the Company and the consummation by the Company of the transactions
contemplated hereby (1) do not and will not require the consent, waiver,
approval, license, designation, or authorization of,
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or the filing of any declaration with, any person or public authority; (2) do
not and will not, with or without the giving of notice or the passage of time
or both, violate or conflict with or result in a breach or termination of any
provision of, or constitute a default under, or accelerate the performance
required by the terms of, or result in the creation of any lien or other
encumbrance upon any of the assets of the Company, or otherwise give rise to
any liability or obligation under, any corporate charter, bylaws, contract or
other agreement, or any license or permit, or any judgment, decree, statute,
regulation or any other restriction of any kind or description to which the
Company is a party or by which it or any of the assets of the Company may be
bound; and (3) will not terminate or result in the termination of any such
contract or other agreement, or in any way affect or violate the terms and
conditions of, or result in the cancellation, modification, revocation,
impairment or suspension of, any rights included in the assets of the Company,
or interfere with the Company's continued use of the assets.
3.10 SECURITIES LAW COMPLIANCE. The Company's common stock is registered
under Section 12(b) of the Securities Exchange Act of 1934 (the "Exchange Act")
and the Company has made all filings required under the Exchange Act. To the
Company's best knowledge after due inquiry, all prior issuances of securities
by the Company have been registered or exempt from registration under the
Securities Act of 1933 and applicable state laws and regulations.
3.11 COMPLIANCE WITH MATERIAL CONTRACTS. Except as set forth in Schedule
3.11, the Company has not received notice of any breach or default under any
material contracts, agreements or instruments to which it is a party.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
In order to induce the Company and the Sellers to enter into this
Agreement and to consummate the transactions contemplated hereby, the Purchaser
makes the following representations and warranties:
4.1 ORGANIZATION, POWER AND AUTHORITY OF THE PURCHASER. The Purchaser is
a corporation duly organized and validly existing under the laws of Georgia,
with full corporate power and authority to enter into this Agreement and to
carry out the transactions and agreements contemplated hereby.
4.2 DUE AUTHORIZATION; BINDING OBLIGATION. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
of the Purchaser. This Agreement has been duly executed and delivered by the
Purchaser and is a valid and binding obligation of the Purchaser, enforceable
in accordance with its terms. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will:
(i) conflict with or violate
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any provision of the articles of incorporation or by-laws of the Purchaser or
of any decree or order of any court or administrative or other governmental
body which is either applicable to, binding upon or enforceable against the
Purchaser; (ii) result in any breach of or default under any mortgage,
contract, agreement, indenture, will, trust or other instrument which is either
binding upon or enforceable against the Purchaser; or (iii) require any
additional consents or approvals except as may be otherwise provided for in
this Agreement.
4.3 NO ADVERSE LITIGATION. There are no actions, suits, claims,
governmental investigations or arbitration proceedings pending or, to the
knowledge of Purchaser, threatened that seek to restrain, prohibit or
invalidate the purchase of the Shares by Purchaser or any other transaction
contemplated hereby, or materially affect the right of Purchaser to own the
Shares or to control the Company.
4.4 INVESTMENT REPRESENTATIONS. Purchaser understands that the Shares
are being offered and sold to it under an exemption from registration provided
for in the Securities Act of 1933 (the "1933 Act") and any applicable state
securities laws. Purchaser represents and warrants that (a) it is able to bear
the economic risk of its investment in the Shares and to hold the Shares for an
indefinite period of time; (b) Purchaser's representatives have had an
opportunity to discuss the Company's business, management and technical and
financial affairs with the Company's management; (c) by reason of its business
or financial experience and the business or financial experience of its
representatives and advisers, Purchaser is capable of evaluating the Company
and the merits and risks of an investment in the Shares and making an informed
investment decision thereon; (d) the Shares are being acquired solely for
Purchaser's own account, for investment purposes only, and are not being
purchased with a view to or for the resale, distribution, subdivision or
fractionalization thereof in violation of applicable securities laws; (e)
except for the assignment permitted by Section 11.4, which assignment is not in
violation of any applicable securities laws. Purchaser has no contract,
undertaking, understanding, agreement or arrangement, formal or informal, with
any person to sell, transfer or pledge to any person the Shares or any part
thereof and it has no present plans to enter into any such contract,
undertaking, agreement or arrangement, and (f) it will not assign, sell or
otherwise transfer the Shares except in accordance with all applicable federal
and state securities laws.
4.5 CORPORATE STRATEGY. Attached hereto as Exhibit E and incorporated
herein by reference are all memoranda sent to the Company by the Purchaser
and/or its representatives regarding future corporate strategy which Purchaser
contemplates for the Company. These memoranda represents the intent of the
Purchaser. While subject to change, Purchaser represents that the outline of
corporate action for the Company contained in the memoranda are its present
intentions and will amend the memoranda if changes are contemplated prior to
Closing.
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ARTICLE 5
COVENANTS OF THE SELLERS AND THE COMPANY
5.1 BEST EFFORTS. The Company and each of the Sellers severally and not
jointly will use its best efforts to cause to be satisfied as soon as
practicable and on or prior to the Closing Date all of the conditions within
its respective control set forth in Article 7 to the obligation of the
Purchaser to purchase the Shares, provided that none of the Sellers will be
obligated to make any additional capital contributions to the Company or to
make any expenditures on behalf of the Company or to incur any indebtedness on
behalf of the Company in order to ensure the accuracy of the representations
and warranties of the Company on the date hereof or the Closing Date. This
provision shall in no way serve to impair the validity or reliability of the
representations and warranties of the Company.
5.2 CONDUCT OF BUSINESS PENDING THE CLOSING. From and after the
execution and delivery of this Agreement and until the Closing Date, except as
otherwise provided by the prior written consent of the Purchaser, the Company
covenants to:
(a) conduct its business and operations in the usual and ordinary
manner in which the same have heretofore been conducted and to use its best
efforts to (i) preserve its business organization intact, (ii) keep available
the services of its officers, employees, agents and distributors, and (iii)
preserve its relationships with customers, suppliers and others having dealings
with the Company;
(b) maintain all of its properties necessary for the conduct of the
Company's business in good repair, order and condition, reasonable wear and use
and damage by unavoidable casualty excepted, and to maintain insurance of such
types and in such amounts upon all of its properties and with respect to the
conduct of its business as are in effect on the date of this Agreement;
(c) not (i) authorize or issue any shares of its capital stock
(including any held in its treasury) or any other securities except that
authorization and issuance of up to 6 million shares to the Xxxxx/Xxxxxx Group,
a Georgia partnership; (ii) declare or pay any dividend or make any other
distribution of or with respect to its shares of capital stock or other
securities or purchase or redeem any shares of its capital stock or other
securities; (iii) pay any bonus or increase the rate of compensation or
pension, retirement or other fringe benefits of any of its salaried employees;
(iv) make any general increase in the compensation or rate of compensation or
pension, retirement or other fringe benefits payable or to become payable to
its hourly-rated employees or enter into a new or modified union collective
bargaining agreement except with the advance approval of the Purchaser which
approval shall not be unreasonably withheld or delayed; (v) sell or transfer
any of its assets other than in the ordinary course of business; (vi) make or
obligate itself to make capital expenditures, other than contracts or
commitments with respect to
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items or substitutes for items set forth in the Company's capital budget,
individually in excess of $500 or aggregating more than $2,500; (vii) incur any
obligations or liabilities or enter into any transaction other than in the
ordinary course of business; or (viii) amend its articles of incorporation or
bylaws.
5.3 ACCESS TO THE COMPANY'S PLANTS, PROPERTIES AND RECORDS. From and
after the execution and delivery of this Agreement and prior to the Closing
Date, the Company will afford to the representatives of the Purchaser access,
during normal business hours and upon reasonable notice, to the Company's
premises and its employees, officers, directors, agents and representatives,
sufficient to enable the Purchaser to inspect the assets and properties and the
books and records of the Company, and will furnish to such representatives
during such period all such information relating to the foregoing investigation
as the Purchaser may reasonably request.
5.4 NO DISCLOSURE. From and after the execution and delivery of this
Agreement and until the Closing Date, without the prior written consent of the
Purchaser, the Company and each Seller severally and not jointly covenant not
to disclose any term or condition of this Agreement to any person or entity
except that such disclosure may be made (i) to any person in a business
relationship with the Company or such Seller to whom such disclosure is
necessary in order to satisfy any of the conditions to the consummation of the
purchase of the Shares which are set forth in this Agreement, and (ii) to the
extent the Company or any such Seller believes in good faith that such
disclosure is required by law (in which case the Company or such Seller will
consult with the Purchaser prior to making such disclosure).
ARTICLE 6
COVENANTS OF THE PURCHASER
6.1 NO DISCLOSURE. From and after the execution and delivery of this
Agreement and until the Closing Date, without the prior written consent of the
Company and each of the Sellers, the Purchaser will not disclose any term or
condition of this Agreement to any person or entity except that such disclosure
may be made (i) to any person in a business relationship with the Company or
the Purchaser to whom such disclosure is necessary in order to satisfy any of
the conditions to the consummation of the purchase of the Shares which are set
forth in this Agreement, and (ii) to the extent the Purchaser believes in good
faith that such disclosure is required by law (in which case the Purchaser will
consult with the Company and the Sellers prior to making such disclosure). The
Purchaser will hold in confidence all documents and information concerning the
Company and the Sellers furnished to the Purchaser pursuant to this Agreement,
and if the sale of the Shares hereto shall not be consummated, such confidence
shall be maintained in accordance with the confidentiality agreement between
the Purchaser and the Company.
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ARTICLE 7
CONDITIONS TO THE OBLIGATION OF THE PURCHASER
The obligation of the Purchaser to purchase the Shares shall be subject
to the fulfillment at or prior to the Closing Date of each of the following
conditions:
7.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES AND COMPLIANCE WITH
OBLIGATIONS. The representations and warranties of the Company and each Seller
contained in this Agreement shall have been true and correct in all material
respects at and as of the date hereof, and they shall be true and correct in
all material respects at and as of the Closing Date with the same force and
effect as though made at and as of that time. The Company and each Seller shall
have performed and complied in all material respects with all of their
respective obligations required by this Agreement to be performed or complied
with at or prior to the Closing Date. The Company and each of the Sellers shall
have delivered to the Purchaser a certificate, dated as of the Closing Date and
signed by such parties, certifying that its or his representations and
warranties are thus true and correct in all material respects and that all of
its or his obligations have been thus performed and complied with in all
material respects.
7.2 RECEIPT OF NECESSARY CONSENTS. Purchaser shall have obtained the
approval of the Purchaser's shareholders referred to in Section 4.2 hereof for
the purchase of the Shares contemplated hereby and such approval shall be shown
by written evidence satisfactory to the Sellers.
7.3 NO MATERIAL ADVERSE CHANGE OR OCCURRENCE. From and after January 2,
1997 until the Closing Date, there shall have been no change in the business or
properties of the Company or in the financial condition of the Company, other
than changes which in the aggregate shall not have had a material adverse
effect on the business, properties, financial condition or results of
operations of the Company, and the property, business or operations of the
Company shall not have been adversely affected in any material way by fire,
accident or other casualty (whether or not covered by insurance), and the
Company shall not have disposed of any of its assets other than in the ordinary
course of its business or with the prior written consent of Purchaser in
accordance with Section 5.2 hereof.
7.4 NO ADVERSE LITIGATION. There shall not be pending any action or
proceeding by or before any court or other governmental body which shall seek
to restrain, prohibit or invalidate the sale of the Shares to the Purchaser or
any other transaction contemplated hereby, or to materially affect the right of
the Purchaser to own the Shares or to control the Company.
7.5 RESIGNATIONS AND RELEASES. The Company shall have delivered to the
Purchaser the written resignations of such officers and directors of the
Company as may be requested by the Purchaser. Each of the directors and
officers of the Company shall have delivered to the
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Company and the Purchaser a release and waiver in a form mutually agreeable to
each of them and to the Purchaser.
7.6 OTHER AGREEMENTS. X. X. Xxxxx and Xxxxx X. Xxxxxx shall have been
appointed as Directors and X. X. Xxxxx shall have been appointed as President
and Chief Executive Officer of the Company on or before the Closing Date.
Xxxxxxx Xxxxxx and Xxxxx Xxxx shall resign as Directors and/or as Officers of
the Company effective as of the date hereof.
7.7 INDEBTEDNESS TO TINTAGEL, XXXXX TECHNOLOGIES, INC. AND XXXXX
INVESTMENTS, LTD. Arrangements satisfactory to the Purchaser shall have been
made for the release of all indebtedness of the Company to Tintagel, Xxxxx
Technologies, Inc. and Xxxxx Investments, Ltd. on the Closing Date,
simultaneously with the Closing.
7.8 SALE OF ADDITIONAL SHARES. The Company shall have authorized the
sale to the Xxxxx/Xxxxxx Group ("SWG"), a Georgia partnership of X. X. Xxxxx
and Xxxxx X. Xxxxxx, of 1,500,000 shares at a price of $.10 per share and
granted to SWG an option to purchase up to an additional 4,500,000 shares on or
before April 7, 1997 at a price of $.10 per share.
7.9 CONSENT OF PURCHASER. Purchaser shall consent to the Closing which
consent shall be within its absolute discretion to grant or withhold.
ARTICLE 8
CONDITIONS TO OBLIGATIONS OF THE SELLERS
The obligation of the Sellers to sell the Shares shall be subject to the
fulfillment at or prior to the Closing Date of each of the following
conditions:
8.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES AND COMPLIANCE WITH
OBLIGATIONS. The representations and warranties of the Purchaser contained in
this Agreement shall have been true and correct in all material respects at and
as of the date hereof, and they shall be true and correct in all material
respects at and as of the Closing Date with the same force and effect as though
made at and as of that time. The Purchaser shall have performed and complied in
all material respects with all of its obligations required by this Agreement to
be performed or complied with at or prior to the Closing Date. The Purchaser
shall have delivered to the Sellers a certificate, dated as of the Closing Date
and signed by a duly authorized director, certifying that such representations
and warranties are thus true and correct in all material respects and that all
such obligations have been thus performed and complied with in all material
respects.
8.2 CERTIFIED RESOLUTIONS. The Purchaser shall have delivered to the
Sellers a copy of a resolution adopted by the board of directors of the
Purchaser authorizing the purchase of the Shares contemplated by this
Agreement, and a copy of a resolution of its shareholders authorizing
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the purchase of the Shares contemplated by this Agreement, certified as of the
Closing Date by its secretary or assistant secretary.
8.3 PURCHASE OF SHARES. The Purchaser shall have acquired from the
Company 1,500,000 shares of the common stock of the Company at a price of $.10
per share on the Closing Date, simultaneously with the Closing.
8.4 ASSUMPTION OF DEBT. The Purchaser shall have assumed the debt of the
Company to Xxxxxxxx Xxxxx in the amount of approximately $43,000 which shall be
paid by Purchaser on or before April 7, 1997.
ARTICLE 9
CERTAIN ACTIONS AFTER THE CLOSING
EXECUTION OF FURTHER DOCUMENTS. From and after the Closing, upon the
reasonable request of the Purchaser, the Company and each Seller shall execute,
acknowledge and deliver all such further acts, deeds, assignments, transfers,
conveyances, powers of attorney and assurances as may be required to convey and
transfer to and vest in the Purchaser and protect its right, title and interest
in the Shares and as may be appropriate otherwise to carry out the transactions
contemplated by this Agreement.
ARTICLE 10
MISCELLANEOUS
10.1 BROKERS, COMMISSIONS AND OTHER EXPENSES.
(a) The Purchaser will indemnify and hold harmless the Sellers from
the commission, fee or claim of any person, firm or corporation employed or
retained or reasonably claiming to be employed or retained by the Purchaser to
bring about, or to represent it in, the transactions contemplated hereby.
(b) Whether or not the transactions contemplated by this Agreement
are consummated, the Company shall pay all of the expenses incurred by it, and
the Sellers shall pay expenses which they incur and the Purchaser shall pay all
expenses which they incur in connection with the transactions contemplated by
this Agreement, including but not limited to the reasonable fees and expenses of
their respective accountants and legal counsel.
(c) The Sellers will indemnify and hold harmless the Purchaser from
the commission, fee or claim of any person, firm or corporation employed or
retained or reasonably
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claiming to be employed or retained by the Sellers to bring about, or to
represent it in, the transactions contemplated hereby.
10.2 AMENDMENT AND MODIFICATION. The parties hereto may amend, modify
and supplement this Agreement in such manner as may be agreed upon by them in
writing.
10.3 TERMINATION. Anything to the contrary herein notwithstanding, this
Agreement may be terminated and the transactions contemplated hereby may be
abandoned:
(i) by the mutual written consent of all of the parties hereto at
any time prior to the Closing Date;
(ii) by the Purchaser at any time prior to the Closing Date if
there shall be a pending action or proceeding by or before any court or other
governmental body which shall seek to restrain, prohibit or invalidate the sale
of the Shares to the Purchaser or any other transaction contemplated hereby, or
materially affect the right of the Purchaser to own the Shares or to control
the Company;
(iii) by the Purchaser in the event of the material breach by the
Sellers or the Company of any provision of this Agreement, which breach is not
remedied by the breaching party or waived by the Purchaser within 30 days after
receipt of notice thereof from the Purchaser;
(iv) by any Seller in the event of the material breach by the
Purchaser of any provi sion of this Agreement, which breach is not remedied by
the Purchaser within 30 days after receipt of notice thereof from such Seller;
or
(v) by any party hereto if the Closing has not taken place by
April 7, 1997.
If this Agreement is terminated, no party shall have any liability for any
costs, expenses, loss of anticipated profit or any further obligation for breach
of warranty or otherwise to any other party to this Agreement.
10.4 BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors, assigns,
heirs and legal representatives. The rights and obligations of the Purchaser
hereunder may not be assigned to any other party without the consent of the
Sellers, except that Purchaser may assign its rights and obligations hereunder
to any direct or indirect wholly-owned subsidiary of the Purchaser, or a
subsidiary of SWG, provided that any such assignment shall not relieve
Purchaser of its obligations hereunder.
10.5 ENTIRE AGREEMENT. This Agreement and the exhibits and schedules
attached hereto, and the other writings referred to herein or delivered
pursuant hereto, and the confidentiality agreement between the Purchaser the
Company, contain the entire agreement of the
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parties hereto with respect to the purchase of the Shares and the other
transactions contemplated herein, and supersede all prior understandings,
agreements and representations of the parties with respect to the subject matter
hereof. Any reference herein to this Agreement shall be deemed to include the
schedules and exhibits attached hereto.
10.6 HEADINGS. The descriptive headings in this Agreement are inserted
for convenience only and do not constitute a part of this Agreement.
10.7 EXECUTION IN COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original.
10.8 NOTICES. Any notice, request, information or other document to be
given hereunder to any of the parties by any other party shall be in writing
and delivered personally or sent by registered or certified mail, postage
prepaid, or by electronic facsimile, as follows:
If to the Company, addressed to:
U.S. Technologies, Inc.
Suite 1110, Bank of Canada Building
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0
Xxxxxx
Attention: Xx. Xxxx X. Xxxxx
Fax No.: (000) 000-0000
If to Tintagel, Ltd., addressed to:
Tintagel, Ltd.
c/o S.T.A.R. Corporate Services Limited
Xxxxxxxx Xxxxx, Xxxx Xxxxxx
Grand Turk, Turks and Caicos Island
British West Indies
Fax No.: (000) 000-0000
If to Komen Holdings Pty. Ltd., addressed to:
Komen Holdings Pty. Ltd.
00 Xxxx Xxxxxx
Xxxxx Xxxx, Xxx Xxxxx Xxxxx 0000
Attention: Mr. Xxxxx O'Loan
Fax No.: 612990-63-259
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If to the Purchaser, addressed to:
GWP, Inc.
One Buckhead Plaza
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xx. X. X. Xxxxx
Fax No.: (000) 000-0000
Any party may change the address or electronic facsimile number to which notices
hereunder are to be sent to it by giving written notice of such change of
address in the manner herein provided for giving notice. Any notice delivered
personally or by registered or certified mail or electronic facsimile shall be
deemed to have been given on the date it is received (or the following business
day, if received on a non-business day or after 5:00 p.m. local time at the
place of receipt).
10.9 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia applicable to contracts made
and to be performed therein.
10.10 SURVIVAL OF WARRANTIES. The Company Warranties set forth in this
Agreement shall survive the Closing and the Closing Date, but only for a period
of one year after the Closing Date. The representations and warranties of the
Purchaser set forth in Article IV of this Agreement shall survive the Closing
and the Closing Date, but only for a period of one year after the Closing Date.
The several representations of the Sellers set forth in Article II of this
Agreement shall survive the Closing and the Closing Date, but only for a period
of one year after the Closing Date.
10.11 UNFILLED BLANK SPACES. Prior to the Closing the parties hereto
shall mutually agree to the information which shall be inserted in any blank
spaces which remain in this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
TINTAGEL, LTD. KOMEN HOLDINGS PTY. LTD.
By: By:
-------------------------------- -----------------------------
Title: Title:
----------------------------- --------------------------
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GWP, INC.
By:
-------------------------------
Title:
----------------------------
U.S. TECHNOLOGIES, INC.
By:
------------------------------
Title:
---------------------------
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INDEX OF EXHIBITS
EXHIBIT No. DESCRIPTION
A Form of Promissory Note from Purchaser to Seller
B Form Stock Purchase Option from Purchaser to Seller
C Form of Collateral Assignment and Security Agreement
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EXHIBIT A
PROMISSORY NOTE
$_________ ___________, 1997
FOR VALUE RECEIVED, GWP, INC. (referred to herein as the "Maker"),
hereby promise to pay to the order of ____________________ (the "Payee"), or
order, at Payee's address ____________________________ or at such other place
as may be designated in writing by Payee, the principal sum of
___________________THOUSAND _______________ HUNDRED AND NO/100THS DOLLARS
($_________) in lawful money of the United States of America.
The unpaid principal balance of this Note shall bear interest at the
rate of eight percent (8%) per annum simple interest. All principal and
interest shall be due and payable on December 31, 1998.
The unpaid principal balance may be prepaid at any time and from time to
time, in whole or in part, without premium or penalty.
The Maker agrees to reimburse the Payee on demand for all costs,
expenses, and charges including, without limitation, reasonable attorneys' fees
in connection with the enforcement and collection of this Note, and any such
amount which is not paid when due.
This Note shall not be modified or discharged, nor shall compliance with
any provision of this Note be waived, except by a writing duly executed by the
Payee.
Presentment for payment, demand, notice of dishonor, protest and notice
of protest, and the benefits of homestead exemptions are hereby waived by the
Maker, as well as any benefit under any exemption or insolvency laws as to this
indebtedness and the Maker agrees to be bound for the payment hereof
notwithstanding any agreement or agreements for extension of the due dates of
any said installments made by the Payee before, on or after the maturity
hereof, even though without its consent, or without notice to it. No delay or
omission of Payee's exercise rights hereunder shall impair any such right or
power or shall be construed to be a waiver of any default or any acquiescence
therein.
Demand for payment shall be presumed to have been issued and the entire
unpaid principal sum of this Note, together with accrued interest thereon, if
any, shall become immediately due in the event of the occurrence of any one or
more of the following:
(a) The filing by either Maker or U.S. Technologies, Inc. ("USXX"),
Delaware corporation, of a voluntary petition in bankruptcy; or
(b) The failure by either Maker or USXX within thirty (30) days thereof
to lift any filing against Maker of any involuntary petition in bankruptcy,
execution or attachment; or
(c) The adjudication of either Maker or USXX as bankrupt unless the
bankruptcy of USXX is triggered by events which occurred prior to the date of
this Note; or
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(d) Any assignment by either Maker or USXX for the benefit of its
creditors; or
(e) The invalidity or illegality of any portion of this Note by reason of
any act or omission by Maker.
Payee and Maker hereby each acknowledge that this Promissory Note is
consideration for the purchase by Maker of ______ shares of the common stock of
USXX (the "Payee's Shares") which Maker has pledged to Payee as security for
this Note pursuant to a Collateral Assignment and Security Agreement of even
date herewith.
Furthermore, Maker acknowledges that on or before April 7, 1997, an
affiliate of Maker, Xxxxx/Xxxxxx Group, a Georgia partnership ("SWG"), is
obligated to purchase an additional 2 million shares of the common stock of
USXX at a price of $.10 per share. Failure of SWG to acquire the additional 2
million shares of USXX common stock shall result in a default under this Note.
Should such default occur, Payee's sole recourse shall be to recover the
Payee's Shares and Maker hereby agrees to return to Payee the Payee's Shares
which shall be in full and complete satisfaction of this Note. If the Payee's
Shares are not returned by April 15, 1997 to Payee upon Maker's failure to
purchase the additional shares from USXX, Payee shall be entitled to seek all
remedies available to it against the Maker under the Collateral Assignment and
Security Agreement and applicable law.
This Note shall be governed and construed under the laws of the United
States of America, State of Georgia. Maker hereby submits to the exclusive
jurisdiction of any state or federal court sitting in Atlanta, Georgia, in any
action or proceeding arising out of or relating to this Note and agrees that
all claims in respect of the action or proceeding shall be heard and determined
in any such court. Maker hereby waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety,
or other security that might be required of Payee with respect thereto. Nothing
herein, however, shall affect the right of Payee to bring any action or
proceeding arising out of or relating to this Note in any other court.
IN WITNESS WHEREOF, the undersigned has caused this Promissory Note to be
signed, sealed and delivered as of the date first above written.
ATTEST: MAKER:
GWP, INC.
By:
-------------------------------- ------------------------------
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EXHIBIT B
OPTION TO PURCHASE COMMON STOCK
OF
U.S. TECHNOLOGIES, INC.
This is to Certify That, FOR VALUE RECEIVED, Tintagel, Ltd., _____, or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Option, from GWP, Inc., a Georgia corporation ("GWP"), _________ fully paid,
validly issued and nonassessable shares of Common Stock, $.01 par value, of
U.S. Technologies, Inc. (the "Company") ("Common Stock") at a price of $0.25
per share at any time or from time to time during the period from July 1, 1998
to September 2, 1998, but not later than 5:00 p.m. Atlanta, Georgia Time, on
September 2, 1998. The number of shares of Common Stock to be received upon the
exercise of this Option and the price to be paid for each share of Common Stock
may be adjusted from time to time as hereinafter set forth. The shares of
Common Stock deliverable upon such exercise, and as adjusted from time to time,
are hereinafter sometimes referred to as "Option Shares" and the exercise price
of a share of Common Stock in effect at any time and as adjusted from time to
time is hereinafter sometimes referred to as the "Exercise Price."
(a) EXERCISE OF OPTION.
This Option may be exercised in whole or in part at any time or
from time to time on or after July 1, 1998 and until September 2, 1998 (the
"Exercise Period"); provided, however, that (i) if either such day is a day on
which banking institutions in the State of Georgia are authorized by law to
close, then on the next succeeding day which shall not be such a day, or (ii)
in the event of any merger, consolidation or sale of substantially all the
assets of the Company as an entirety, resulting in any distribution to the
Company's stockholders, the Holder shall have the right to exercise this Option
commencing at such time for a period of ninety (90) days thereafter into the
kind and amount of shares of stock and other securities and property (including
cash) receivable by a holder of the number of shares of Common Stock into which
this Option might have been exercisable immediately prior thereto, or (iii) in
the event of the prepayment of that Note from GWP to Holder dated _________,
19__ in the amount of $_________ (the "Note"), Holder shall have the right to
exercise this Option in the amount of twenty percent (20%) of such prepayment
amount at any time within ninety (90) days after the date such prepayment is
made. This Option may be exercised by presentation and surrender hereof to GWP
at its principal office with the Purchase Form annexed hereto duly executed and
accompanied by payment of the Exercise Price for the number of Option Shares
specified in such form. Payment therefor may be made by forgiveness of
indebtedness due on the Note in an amount of up to $_______ plus twenty percent
(20%) of interest remaining due on the Note. As soon as practicable after each
such exercise of the Options, but not later than seven (7) days from the date
of such exercise, GWP shall provide instructions to the Company's transfer
agent to deliver to the Holder a certificate or certificate for
21
the Option Shares issuable upon such exercise, registered in the name of the
Holder or its designee. If this Option should be exercised in part only, GWP
shall, upon surrender of this Option for cancellation, execute and deliver a new
option evidencing the rights of the Holder thereof to purchase the balance of
the Option Shares purchasable thereunder.
(b) RESERVATION OF SHARES. GWP shall at all times own and reserve for
delivery upon exercise of this Option such number of shares of the Company's
Common Stock as shall be required for delivery upon exercise of this Option.
(c) RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be
entitled to any rights of a shareholder in the Company, either at law or
equity, and the rights of the Holder are limited to those expressed in the
Option and are not enforceable against the Company except to the extent set
forth herein.
(d) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at any time
and the number and kind of securities purchasable upon the exercise of the
option shall be subject to adjustment from time to time upon the happening of
certain events as follows:
(1) In case the Company shall (i) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common
Stock, (ii) subdivide or reclassify its outstanding shares of Common Stock into
a greater number of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the Exercise Price in
effect at the time of the record date for such dividend or distribution or of
the effective date of such subdivision, combination or reclassification shall
be adjusted so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall be the number of
shares of Common Stock outstanding after giving effect to such action, and the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be made successively
whenever any event listed above shall occur.
(2) In case the Company shall hereafter distribute to the holders
of its Common Stock evidences of its indebtedness or assets (excluding cash
dividends or distributions and dividends or distributions referred to in
Subsection (1) above) or subscription rights or options, then in each such case
the Exercise Price in effect thereafter shall be determined by multiplying the
Exercise Price in effect immediately prior thereto by a fraction, the numerator
of which shall be the total number of shares of Common Stock outstanding
multiplied by the current market price per share of Common Stock (as defined in
Subsection (8) below), less the fair market value (as determined by the
Company's Board of Directors) of said assets or evidences of indebtedness so
distributed or of such rights or options, and the denominator of which shall be
the total number of shares of Common Stock outstanding multiplied by such
current market price per share of Common Stock. Such adjustment shall be made
successively whenever such a record date is fixed. Such adjustment shall be
made whenever any such distribution is made and shall become effective
immediately after the record date for the determination of shareholders
entitled to receive such distribution.
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(3) Whenever the Exercise Price payable upon exercise of each
Option is adjusted pursuant to Subsections (1) or (2) above, the number of
Shares purchasable upon exercise of this Option shall simultaneously be
adjusted by multiplying the number of Shares initially issuable upon exercise
of this Option by the Exercise Price in effect on the date hereof and dividing
the product so obtained by the Exercise Price, as adjusted.
(4) For the purpose of any computation under Subsection (2)
above, the current market price per share of Common Stock at any date shall be
deemed to be the lower of (i) the average of the daily closing prices for 30
consecutive business days before such date or (ii) the closing price on the
business day immediately preceding such date. The closing price for each day
shall be the last sale price regular way or, in case no such reported sale
takes place on such day, the average of the last reported bid and asked prices
regular way, in either case on the principal national securities exchange on
which the Common Stock is admitted to trading or listed, or if not listed or
admitted to trading on such exchange, the average of the highest reported bid
and lowest reported asked prices as reported by NASDAQ, or other similar
organization if NASDAQ is no longer reporting such information, or if not so
available, the fair market price as determined by the Board of Directors.
(5) No adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least five cents
($0.05) in such price; provided, however, that any adjustments which by reason
of this Subsection (6) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment required to be made hereunder.
All calculations under this Section (d) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be. Anything in this
Section (d) to the contrary notwithstanding, the Company shall be entitled, but
shall not be required, to make such changes in the Exercise Price, in addition
to those required by this Section (d), as it shall determine, in its sole
discretion, to be advisable in order that any dividend or distribution in shares
of Common Stock, or any subdivision, reclassification or combination of Common
Stock, hereafter made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock.
(6) Whenever the Exercise Price is adjusted, as herein provided,
GWP shall be required to promptly but no later than 10 days after any request
for such an adjustment by the Holder, cause a notice setting forth the adjusted
Exercise Price and adjusted number of Shares issuable upon exercise of the
Option, and, if requested, information describing the transactions giving rise
to such adjustments, to be mailed to the Holder at its last known address. In
the event of a dispute between the Holder and GWP, GWP shall retain a firm of
independent certified public accountants (who may be the regular accountants
employed by the Company) to make any computation required by this Section (d),
and a certificate signed by such firm shall be conclusive evidence of the
correctness of such adjustment.
(7) In the event that at any time, as a result of an adjustment
made pursuant to Subsection (1) above, the Holder of this Option thereafter
shall become entitled to receive any shares of the Company, other than Common
Stock, thereafter the number of such other shares so receivable upon exercise
of this Option shall be subject to adjustment from time to time in a
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manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in Subsections (1) to (7), inclusive
above.
(e) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Option) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, GWP shall, as a condition precedent
to its consent to such transaction, cause effective provisions to be made so
that the Holder shall have the right thereafter by exercising this Option at any
time prior to the expiration of the Option, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Option immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Option.
The foregoing provisions of this Section shall similarly apply to successive
reclassifications, capital reorganizations and changes of shares of Common Stock
and to successive consolidations, mergers, sales or conveyances. In the event
that in connection with any such capital reorganization or reclassification,
consolidation, merger, sale or conveyance, additional shares of Common Stock
shall be issued in exchange, conversion, substitution or payment, in whole or in
part, for a security of the Company other than Common Stock, any such issue
shall be treated as an issue of Common Stock covered by the provisions of
Subsection (1) of Section (d) hereof.
IN WITNESS HEREOF, GWP, Inc. has executed this Stock Option Agreement
on the ____ day of ___________, 199__.
GWP, INC.
By:
---------------------------
Xxx Xxxxx
Chief Executive Officer
[SEAL]
Dated: , 1996
--------------------------
Attest:
--------------------------------------
Secretary
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PURCHASE FORM
Dated , 19
----- ---
The undersigned hereby irrevocably elects to exercise the within Option
to the extent of purchasing ______________ shares of Common Stock and hereby
makes payment of _________________ in payment of the actual exercise price
thereof.
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name:
---------------------------------------------------------------------------
(Please typewrite or print in block letters)
Address:
------------------------------------------------------------------------
Signature:
--------------------------------------------------------
ASSIGNMENT FORM
FOR VALUE RECEIVED,_______________________hereby sells, assigns and
transfers unto
Name:
---------------------------------------------------------------------------
(Please typewrite or print in block letters)
Address:
------------------------------------------------------------------------
the right to purchase Common Stock represented by this Option to the extent of
_________ shares as to which such right is exercisable and does hereby
irrevocably constitute and appoint ______________________________ Attorney, to
transfer the same on the books o of the Company with full power of substitution
in the premises.
Date , 19
------- -----
Signature:
----------------------------------------------------------------------
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EXHIBIT C
COLLATERAL ASSIGNMENT AND SECURITY AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into as of the
____ day of December, 1997 by and between GWP, INC., a Georgia corporation
(hereinafter referred to as an "Assignor"), and TINTAGEL, LTD. ("Tintagel"), a
Turks & Caicos Trust.
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of
which are acknowledged by the parties hereto, the parties agree as follows:
1. Security. As collateral security for, and to secure the prompt
payment in full of, any and all indebtedness, obligations, liabilities,
covenants and duties of Assignor to Tintagel under that certain Promissory Note
in the original principal amount of $_______ of even date herewith, paid by
Assignor to the order of Tintagel (hereinafter "Note") executed by Assignor to
Tintagel as payee, and all expenses and attorney's fees chargeable to Assignor,
as provided in said Note or this Agreement (all such indebtedness, obligations,
liabilities, covenants and duties being collectively herein referred to as
"Obligations"), Assignor hereby grants, assigns and conveys to Tintagel its
entire right, title and interest in and to ____________ (___) shares of the
common stock (the "Common Stock") of U.S. Technologies, Inc. ("USXX"),
including, without limitation, all proceeds thereof and all rights corresponding
thereto (such shares and all proceeds thereof and all rights corresponding
thereto being collectively referred to herein as the "Pledged Stock").
2. Certain Representations. Assignor covenants, represents, and
warrants that:
(a) Assignor is the legal and beneficial owners of __________
(___) shares of the Common Stock of USXX;
(b) Assignor is the sole and exclusive legal and beneficial owner
of the entire and unencumbered right, title and interest in and to the Pledged
Stock, free and clear of any liens, charges and encumbrances;
(c) Assignor has the right to enter into this Agreement and
perform its terms; and,
(d) Simultaneously with the execution of this Agreement, Assignor
has surrendered to Tintagel the outstanding stock certificate No. ______ for the
Pledged Shares, which Certificate No. __ shall be duly endorsed in favor of
Tintagel and accompanied by a stock power executed by Assignor in blank in such
form as shall be acceptable to Tintagel, such Pledged Shares to be held by
Tintagel as collateral security pursuant to the terms and conditions of this
Agreement.
3. General Affirmative Covenants. Assignor covenants to Tintagel
that, from and after the date hereof, and so long as any amount remains unpaid
on account of the Note:
26
(a) Assignor will not sell, assign, transfer or otherwise dispose
of any of the Pledged Stock, or any interest therein. Assignor will do such acts
as Tintagel may request to establish and maintain with Tintagel a valid and
perfected security interest in the Pledged Stock free of any other liens and
security interests.
(b) Assignor will sign such financing statement or statements
in form satisfactory to Tintagel, which Tintagel may at any time desire to file
in order to perfect its security interest in the Pledged Stock and reimburse
Tintagel for the cost of filing the same; and they will execute and/or deliver
to Tintagel any instrument, invoice, document, assignment or other writing which
may be necessary or convenient to Tintagel to carry out the terms of this
Agreement, and to perfect his security interest in and facilitate the collection
of the Pledged Stock, and the proceeds thereof.
(c) Tintagel, or any person or persons designated by it, shall
have the right to call at the place or places of business of Assignor or USXX at
any reasonable time, and without hindrance or delay, to inspect, audit, check
and make extracts from Assignor's or Tintagel's books, records, journals,
orders, receipts and any correspondence and other data relating to Assignor's or
Tintagel's business or to any other transactions between or among the parties
hereto.
(d) Assignor shall promptly notify Tintagel in writing (i) upon
the occurrence of any default as set forth in the Note, or any event or
condition which the passage of time or giving of notice, or both, would
constitute a default; (ii) of each change in the name of or trade name used by
USXX and, the location of the chief executive office or the principal place of
the business or place where the business records of USXX are kept; (iii) of all
threatened or actual actions or suits, investigations or proceedings before any
court, arbitrator or governmental entity against Assignor or USXX including but
not limited to environmental or labor disputes which may have an adverse
material effect on the Company; (iv) of any material adverse change in the
condition (financial or otherwise) of Assignor or USXX; and (v) of any seizure
or levy upon any part of the Pledged Stock or any other Common Stock of USXX.
(e) Assignor shall not, without the express prior written consent
of Tintagel: (i) cause USXX to sell all or substantially all of the assets of
USXX, or cause USXX to engage in a liquidation, dissolution, merger,
consolidation, recapitalization, or any other stock reclassification or business
combination; or (ii) cause USXX to sell, transfer or otherwise dispose of any of
its assets other than in the ordinary course of its business for fair
consideration.
4. Events of Default. The following shall constitute events of
default hereunder (an "Event of Default"):
(a) The occurrence of a default under the Note.
(b) Any material representation or warranty made by Assignor
in this Agreement or in any certificate, financial or other statement furnished
at any time hereunder or in connection with this Agreement proving to have been
untrue in any material respect when made or furnished.
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(c) The default by Assignor in the observance or performance
of any other material covenant or agreement contained in this Agreement.
(d) Failure of the Assignor's affiliate Xxxxx/Xxxxxx Group, a
Georgia partnership, to purchase on or before April 7, 1997 an additional 2
million shares of USXX at a price of $.10 per share.
(e) Failure of the Purchaser to pay the debt of the Company
to Xxxxxxxx Xxxxx in the amount of $43,--- on or before April 7, 1997.
5. Remedies. Upon the occurrence or existence of any Event of
Default, or at any time thereafter (such default not having been previously
cured), Tintagel shall have such rights and remedies as shall be provided in the
Note, this Agreement, and otherwise at law or at equity (including all rights
and remedies of a secured party under the Uniform Commercial Code as enacted in
the State of Georgia), which rights and remedies are cumulative and may be
exercised simultaneously, and which rights and remedies shall include but not be
limited to the following:
(a) Tintagel may, at its option, declare the Note to be
immediately due and payable, whereupon the same (including the aggregate
principal amount of the Note together with all accrued interest thereon) shall
become immediately due and payable without presentment, demand, protest, notice
of non-payment or any other notice required by law relative thereto, all of
which are hereby expressly waived by Assignor, anything contained herein or in
the Note to the contrary notwithstanding.
(b) Tintagel shall have the immediate right, if Tintagel so
desires, in his sole and absolute discretion, to apply any and all funds
available under or constituting the Pledged Stock, towards the total
indebtedness owed by Assignor to Tintagel as evidenced herein. In connection
with said rights of Tintagel to apply the Pledged Stock to the outstanding
indebtedness owed by Assignor to Tintagel, Assignor hereby designates,
appoints, and assigns Tintagel as Assignor's attorney-in-fact and agent to
apply any and all funds constituting the Pledged Stock to the total
indebtedness owing by Assignor to Tintagel. Said rights shall include the right
to sell,
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assign and deliver all or any portion of the Pledged Stock, at the same time or
at different times without notice, demand, or advertisement of any kind.
Tintagel shall have the right and power (a) for and in the name, place and stead
of Assignor, to execute endorsements, assignments or other instruments of
conveyance or transfer with respect to all or any of the Pledged Stock, and (b)
to receive, endorse and collect all checks and other orders for the payment of
money made payable to Assignor representing any distribution payable in respect
of the Pledged Stock or any part thereof and to give full discharge for the
same. Any remainder of the proceeds after payment in full of the Obligations
shall be paid over to Assignor. Notice of any sale or other disposition of the
Pledged Stock shall be given to Assignor at least fifteen (15) days before the
time of any intended public or private sale or other disposition of the Pledged
Stock is to be made, which Assignor hereby agrees shall be reasonable notice of
such sale or other disposition.
(c) Assignor shall pay Tintagel on demand for all costs,
expenses, and charges, including without limitation, reasonable attorneys' fees
and court costs, in connection with the enforcement of this Agreement.
(d) Notwithstanding any provision herein to the contrary,
should the default of Assignor be caused by its failure to purchase an
additional 2 million shares of the Common Stock of USXX on or before April 7,
1997, Tintagel's only recourse shall be the right to assign and deliver all of
the Pledged Stock back to itself in full and complete satisfaction of the Note.
Furthermore, Assignor hereby waives any and all right whatsoever to object to
the assignment and delivery of the Pledged Stock back to Tintagel should it fail
to purchase the additional 2 million shares of Common Stock of USXX at a price
of $.10 per share on or before April 7, 1997.
6. Voting; Distributions. Except as provided herein, unless and
until there shall have occurred and be continuing an Event of Default, Assignor
shall have the exclusive right to vote the shares represented by the Pledged
Stock and to receive any and all dividends or distributions related thereto.
7. Miscellaneous.
(a) Repayment; Termination. If the Obligations secured by
this Agreement have been satisfied in full to the satisfaction of Tintagel, then
at such time, Tintagel shall re-assign, re-convey, and transfer to Assignor all
Pledged Stock held by Tintagel to or for the Obligations, and this Agreement
shall terminate.
(b) Cumulative Rights; Non-Waiver. Each and every right
granted to Tintagel under this Agreement, the Note and any other document
delivered hereunder or in connection herewith or allowed by law or equity shall
be cumulative and may be exercised from time to time. No failure on the part of
Tintagel to exercise, and no delay in exercising, any right shall operate as a
waiver thereof, nor shall any single or partial exercise by Tintagel of any
right preclude any other or future exercise thereof or the exercise of any other
right. No waiver by Tintagel of any default hereunder shall constitute a waiver
of any subsequent default.
(c) Governing Law; Submission to Jurisdiction. This
Agreement, the Note, and the rights and Obligations of the parties hereunder and
thereunder shall be governed by, and
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construed and interpreted in accordance with, the laws of the State of Georgia.
Assignor hereby submits to the exclusive jurisdiction of any state or federal
court sitting in Atlanta, Georgia, in any action or proceeding arising out of or
relating to this Agreement and agrees that all claims in respect of the action
or proceeding shall be heard and determined in any such court. Each Assignor
hereby waives any defense of inconvenient forum to the maintenance of any action
or proceeding so brought and waives any bond, surety, or other security that
might be required of Tintagel with respect thereto. Tintagel may make service on
any Assignor by sending or delivering a copy of the process to such Assignor to
be served at the address and in the manner provided for the giving of notices
herein. Nothing in this Section, however, shall affect the right of Tintagel to
bring any action or proceeding arising out of or relating to this Agreement in
any other court or to serve legal process in any other manner permitted by law
or in equity. Assignor agree that a final nonappealable judgment in any action
or proceeding so brought shall be conclusive and may be enforced by suit on the
judgment or in any other manner provided by law or in equity.
(d) Survival. All representations, warranties, and covenants
made herein shall survive the execution and delivery of the Note and any other
agreement or instrument hereunder.
(e) No Assignment. No assignment hereof shall be made by
Assignor without the prior written consent of Tintagel.
(f) Notices, Etc. All notices, requests, demands and other
communication provided for hereunder shall be in writing and mailed or
personally delivered to the applicable party at the address indicated below:
If to Assignor: GWP, Inc.
One Buckhead Plaza
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xx. X. X. Xxxxx
Fax No.: (000) 000-0000
If to Tintagel: Tintagel, Ltd.
c/o S.T.A.R. Corporate Services Limited
Xxxxxxxx Xxxxx, Xxxx Xxxxxx
Grand Turk, Turks and Caicos Island
British West Indies
Fax No.: (000) 000-0000
or, as to each party, at such other address as shall be designated by such
party in written notice to the other party complying as to the delivery with
the terms hereof. Except as otherwise expressly provided in this Agreement, all
such notices, requests, demands and other communication shall be effective upon
the third (3rd) day after such notice is deposited in the United States mail
(by registered or certified U.S. mail, return receipt requested, and postage
prepaid), or when communicated via facsimile at the number provided above, or
when personally delivered to the addressee via overnight express mail service.
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(g) Specific Performance. Assignor agrees that it is
impossible to measure in money the damages which will accrue to Tintagel by
reason of the failure of Assignor to comply with this Agreement. Because the
obligations under this Agreement are of a special, unique and extraordinary
character and the remedy at law for any breach of any such obligation shall be
inadequate, Tintagel shall be entitled, in addition to all remedies otherwise
available pursuant to this Agreement at law or in equity (which rights and
remedies are cumulative and may be exercised simultaneously), to institute an
action or proceeding to enforce specifically the provisions of this Agreement,
and the party against whom such action is brought agrees not to urge in such
action or proceeding the claim or defense that a remedy at law exists.
(h) Amendment, Etc. No amendment, modification, termination
or waiver of any provision of this Agreement or the Note, nor consent to or
departure by Assignor therefrom, shall in any event be effective unless the same
shall be in writing and signed by Tintagel, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
(i) Counterparts. This Agreement may be executed in two or
more counterparts, each of which when fully executed shall be an original, and
all of such counterparts taken together shall be deemed to constitute one and
the same agreement.
(j) Complete Agreement. Except as contemplated herein, this
Agreement supersedes all prior discussions and agreements between the parties
with respect to the express subject matter contained herein, and this Agreement
contains the sole and entire agreement between the parties with respect to the
express transactions contemplated herein.
(k) Binding Effect. This Agreement shall be binding upon and
shall inure to the benefit of the respective parties hereto and their
respective heirs, legal representatives, successors and permitted assigns.
(l) Severability. If any provision of this Agreement is
declared void by any court of competent jurisdiction, the validity of any other
provision of this Agreement shall not be affected. In the event of such
declaration, the parties are obligated to negotiate diligently and in good
faith to modify the offending provision so as to bring it into compliance with
applicable law while preserving to the maximum extent feasible the benefits of
this Agreement to all parties.
(m) Judicial Interpretation. The parties understand,
acknowledge, and agree that, should any provision of this Agreement require
judicial interpretation, the court or other tribunal interpreting or construing
the Agreement shall not apply a presumption that the terms of this Agreement
shall be more strictly construed against one party by reason of the rule of
construction that a document is to be construed more strictly against the party
who itself or through its agent prepared same, it being agreed that all parties
or their agents have read, understood, and participated in the negotiation of
this Agreement.
(n) Number; Gender; Section Headings, Etc. Whenever required
by the context, the singular number shall include the plural, the plural number
shall include the singular, and the gender of any word shall include all other
genders. The section and other headings
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contained in this Agreement are for identification or reference purposes only
and in no way define, limit, extend or describe the scope of this Agreement or
the intent of any provision of this Agreement. Unless otherwise provided herein,
references to a period of days shall mean consecutive calendar days. If the last
day of any time period stated herein shall fall on a Saturday, Sunday or legal
holiday, then the duration of such time period shall be extended so that it
shall end on the next succeeding day which is not a Saturday, Sunday or legal
holiday.
(o) Joint and Several Liability. Assignor acknowledges and
agrees that it shall be jointly and severally liable for all obligations of
Assignor hereunder.
(p) Further Assurances. Assignor covenants and agrees that it
shall execute and deliver such other agreements, instruments and documents as
are or may become necessary or convenient to effect and carry out the
performance of the activities contemplated by this Agreement.
IN WITNESS WHEREOF the parties hereto have executed this Agreement
under seal, all as the day and year first above written.
ASSIGNOR:
GWP, INC.
By:
-----------------------------------------
Xxx Xxxxx, President
TINTAGEL, LTD.
By:
-----------------------------------------
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