STOCK AND WARRANT PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of September 28, 1999 by and
between Xxxx Xxxxxxx, an individual ("PURCHASER") and Lakota
Technologies, Inc., a Colorado corporation ("SELLER").
W I T N E S S E T H
WHEREAS, SELLER desires to sell 1,500,000 shares of Lakota
Technologies, Inc., a Colorado corporation (the "Company") Common
Stock (the "Shares"), and warrants to acquire an additional 500,000
shares of Company Common Stock (the "Warrants") to PURCHASER on the
terms and conditions set forth in this Stock Purchase Agreement
(hereinafter called "Agreement"); and
WHEREAS, PURCHASER desires to buy the Shares and Warrants on
the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the promises and respective
mutual agreements herein contained, it is agreed by and between the
parties hereto as follows:
ARTICLE 1
SALE AND PURCHASE OF THE SHARES AND WARRANTS
1.1 Sale of the Shares and Warrants. Upon the execution of
this Agreement as provided in Section 3.1 hereto (the "Closing"),
subject to the terms and conditions herein set forth, and on the
basis of the representations, warranties and agreements herein
contained, SELLER shall sell to PURCHASER, and PURCHASER shall
purchase from SELLER, the Shares and the Warrants.
1.2 Instruments of Conveyance and Transfer. Within four
business days of the date of execution hereof (the "Closing"),
SELLER shall deliver a certificate or certificates representing the
Shares to PURCHASER, in form and substance satisfactory to
PURCHASER, as shall be effective to vest in PURCHASER all right,
title and interest in and to all of the Shares, as set forth in
Section 3 herein. In addition, SELLER shall deliver to PURCHASER a
warrant agreement granting PURCHASER the right, exercisable for a
period of 2 years from the date thereof, to acquire 500,000 shares
of Company common stock at an exercise price of $0.28 per share.
1.3 Consideration and Payment for the Shares and Warrants. In
consideration for the Shares and Warrants PURCHASER shall pay the
purchase price equal to $0.14 per share, for the total purchase
price of $210,000.00 ("Purchase Price"). The Purchase Price shall
be forwarded to SELLER on the Closing Date.
ARTICLE 2
REPRESENTATIONS AND COVENANTS OF SELLER AND PURCHASER
2.1 The SELLER hereby represents and warrants that:
(a) It shall transfer title, in and to the Shares, to the
PURCHASER free and clear of all liens, security
interests, pledges, encumbrances, charges,
restrictions, demands and claims, of any kind and
nature whatsoever, whether direct or indirect or
contingent, except as set forth in Paragraph 2.2 herein.
2.2 On the Closing Date as defined herein in Section 3.1, the
SELLER shall deliver to the PURCHASER certificates representing the
Shares subject to no liens, security interests, pledges,
encumbrances, charges, restrictions, demands or claims in any other
party whatsoever, except as set forth in the legend on the
certificate(s), which legend shall provide as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE,
AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF FOR A PERIOD OF ONE
YEAR FROM THE ISSUANCE THEREOF EXCEPT (i) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND ANY
APPLICABLE STATE LAWS OR (ii) UPON THE EXPRESS WRITTEN
AGREEMENT OF THE COMPANY AND COMPLIANCE, TO THE EXTENT
APPLICABLE, WITH RULE 144 UNDER THE ACT (OR ANY SIMILAR
RULE UNDER THE ACT RELATING TO THE DISPOSITION OF
SECURITIES.)
2.3 Registration Rights. If the Company at any time
proposes to register any of its securities under the Act, including
under an SB-2 Registration Statement or otherwise, it will each such
time give written notice to the PURCHASER of its intention so to do.
Upon the written request of PURCHASER given within 30 days after
receipt of any such notice, the Company will use its best efforts to
cause the Shares and shares underlying the exercise of the Warrants
to be registered under the Act (with the securities which the
Company at the time propose to register). All expenses incurred by
the Company in complying with this Section, including without
limitation all registration and filing fees, listing fees, printing
expenses, fees and disbursements of all independent accountants, or
counsel for the Company and the expense of any special audits
incident to or required by any such registration and the expenses of
complying with the securities or blue sky laws of any jurisdiction
shall be paid by the Company.
2.4. The PURCHASER hereby represents and warrants that:
(a) PURCHASER acknowledges that the Shares and the shares
obtained upon exercise of the Warrants will be
"restricted securities" (as such term is defined in
Rule 144 promulgated under the Securities Act of
1933, as amended ("Rule 144")), that they will
include the foregoing restrictive legend, and, except
as otherwise set forth in this Agreement, that they
cannot be sold for a period of one year from the date
of issuance unless registered with the SEC and
qualified by appropriate state securities regulators,
or unless PURCHASER obtains written consent from the
SELLER and otherwise complies with an exemption from
such registration and qualification (including,
without limitation, compliance with Rule 144).
(b) The PURCHASER has the full right, power and authority
to enter into this Agreement and to carry out and
consummate the transaction contemplated herein. This
Agreement constitutes the legal, valid and binding
obligation of PURCHASER.
(c) The PURCHASER acknowledges that investment in
the Shares involves substantial risks and is
suitable only for persons of adequate
financial means who can bear the economic risk
of an investment in the Shares for an
indefinite period of time. PURCHASER further
represents that he:
(1) has adequate means of providing for
his or her current needs and
possible personal contingencies,
has no need for liquidity in his
investment in the Shares, is able
to bear the substantial economic
risks of an investment in the
Shares for an indefinite period,
and, at the present time, can
afford a complete loss of his
investment;
(2) is an "Accredited Investor" as that
term is defined in Section 501(a)
of Regulation D promulgated under
the Securities Act of 1933, as
amended (the "Act"), in that (i)
PURCHASER is a natural person whose
individual net worth, or joint net
worth with PURCHASER's spouse,
exceeds $1,000,000 and either he is
able to bear the economic risk of
investment in the proposed
investments or the proposed
investments will not exceed 10% of
his net worth or joint net worth
with PURCHASER's spouse and/or (ii)
PURCHASER is a natural person who
had individual income in excess of
$200,000 in each of the two most
recent years, or joint income with
such investor's spouse in excess of
$300,000 in each of those years and
reasonably expects to reach the
same income level in the current
year, and either PURCHASER is able
to bear the economic risk of
investment in the proposed
investments or the proposed
investments will not exceed 10% of
his or her net worth or joint net
worth with PURCHASER's spouse;
(3) does not have an overall commitment
to investments which are not
readily marketable that is
disproportionate to his net worth,
and that his investment in the
Shares will not cause such overall
commitment to become excessive;
(4) is acquiring the Shares for his or
her own account, for investment
purposes only and not with a view
toward resale, assignment or
distribution thereof, and no other
person has a direct or indirect,
beneficial interest, in whole or in
part, in such Shares;
(5) has such knowledge and experience
in financial, tax and business
matters that he or she is capable
of evaluating the merits and risks
of an investment in the Shares;
(6) has been given the opportunity to
ask questions of and to receive
answers from persons acting on each
of the SELLERS' behalf concerning
the terms and conditions of this
transaction and also has been given
the opportunity to obtain any
additional information which each
of the SELLERS possess or can
acquire without unreasonable effort
or expense. As a result, PURCHASER
is cognizant of the financial
condition, capitalization, use of
proceeds from this financing and
the operations and financial
condition of the Company has
available full information
concerning their affairs and has
been able to evaluate the merits
and risks of the investment in the
Shares; and
(7) The funds provided for the PURCHASER's purchase
are either separate property, community
property over which the signatory(ies) hereto
has or have the right of control or are
otherwise funds as to which the undersigned has
the sole right of management.
ARTICLE 3
CLOSING AND DELIVERY OF DOCUMENTS
3.1 Closing. The Closing shall be deemed to have occurred
upon the date of signing of this Agreement. Subsequent to the
signing, the following shall occur as a single integrated transaction:
3.2 Delivery by SELLER.
(a) SELLER shall deliver, or cause to be delivered, to
the PURCHASER the stock certificate and warrant agreement and
any and all other instruments of conveyance and transfer
required by Section 1.2.
(b) SELLER shall deliver, or cause to be delivered, to the
PURCHASER such instruments, documents and certificates as are
required to be delivered by SELLER or its representatives
pursuant to the provisions of this Agreement.
3.3 Delivery by PURCHASER.
(a) The PURCHASER shall deliver, or cause to be delivered, to
the SELLER the Purchase Price required by Section 1.3.
(b) The PURCHASER shall deliver, or cause to be delivered, to
SELLER such instruments, documents and certificates as are
required to be delivered by the PURCHASER or its
representatives pursuant to the provisions of this Agreement.
ARTICLE 4
TERMINATION, AMENDMENT AND WAIVER
4.1 Termination. Notwithstanding anything to the contrary
contained in this Agreement, this Agreement may be terminated and
the transactions contemplated hereby may be abandoned at any time
prior to delivery of the Purchase Price solely by the mutual
consent of all of the parties.
4.2 Waiver and Amendment. Any term, provision, covenant,
representation, warranty or condition of this Agreement may be
waived, but only by a written instrument signed by the party
entitled to the benefits thereof. The failure or delay of any party
at any time or times to require performance of any provision hereof
or to exercise its rights with respect to any provision hereof shall
in no manner operate as a waiver of or affect such party's right at
a later time to enforce the same. No waiver by any party of any
condition, or of the breach of any term, provision, covenant,
representation or warranty contained in this Agreement, in any one
or more instances, shall be deemed to be or construed as a further
or continuing waiver of any such condition or breach or waiver of
any other condition or of the breach of any other term, provision,
covenant, representation or warranty. No modification or amendment
of this Agreement shall be valid and binding unless it be in writing
and signed by all parties hereto.
ARTICLE 5
MISCELLANEOUS
5.1 Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to
the transactions contemplated hereby, and supersedes all prior
agreements, arrangements and understandings related to the subject
matter hereof. No understanding, promise, inducement, statement of
intention, representation, warranty, covenant or condition, written
or oral, express or implied, whether by statute or otherwise, has
been made by any party hereto which is not embodied in this
Agreement or the written statements, certificates, or other
documents delivered pursuant hereto or in connection with the
transactions contemplated hereby, and no party hereto shall be bound
by or liable for any alleged understanding, promise, inducement,
statement, representation, warranty, covenant or condition not so
set forth.
5.2 Notices. All notices provided for in this Agreement
shall be in writing signed by the party giving such notice, and
delivered personally or sent by overnight courier or messenger or
sent by registered or certified mail (air mail if overseas), return
receipt requested, or by telex, facsimile transmission, telegram or
similar means of communication. Notices shall be deemed to have
been received on the date of personal delivery, telex, facsimile
transmission, telegram or similar means of communication, or if sent
by overnight courier or messenger, shall be deemed to have been
received on the next delivery day after deposit with the courier or
messenger, or if sent by certified or registered mail, return
receipt requested, shall be deemed to have been received on the
third business day after the date of mailing. Notices shall be sent
to the addresses set forth below:
If to SELLER:
Lakota Technologies, Inc.
0000 Xxxxx Xxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxx Xxxxxxxx, President
Facsimile (000) 000-0000
With a copy to:
Xxxxxx Law Group
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx, Esq.
Facsimile (000) 000-0000
If to Purchaser:
Xxxx Xxxxxxx
000 Xxxxxxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Facsimile (______)________________
5.3 Choice of Law and Venue. This Agreement and the
rights of the parties hereunder shall be governed by and construed
in accordance with the laws of the State of Georgia including all
matters of construction, validity, performance, and enforcement and
without giving effect to the principles of conflict of laws. Any
action brought by any party hereto shall be brought within the State
of Georgia.
5.4 Jurisdiction. The parties submit to the jurisdiction
of the Courts of the State of Georgia or a Federal Court empaneled
in the State of Georgia for the resolution of all legal disputes
arising under the terms of this Agreement, including, but not
limited to, enforcement of any arbitration award.
5.5 Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, but
all of which shall together constitute one and the same instrument.
5.6 Attorneys' Fees. Except as otherwise provided herein,
if a dispute should arise between the parties including, but not
limited to arbitration, the prevailing party shall be reimbursed by
the nonprevailing party for all reasonable expenses incurred in
resolving such dispute, including reasonable attorneys' fees
exclusive of such amount of attorneys' fees as shall be a premium
for result or for risk of loss under a contingency fee arrangement.
5.7 Taxes. Any income taxes required to be paid in
connection with the payments due hereunder, shall be borne by the
party required to make such payment. Any withholding taxes in the
nature of a tax on income shall be deducted from payments due, and
the party required to withhold such tax shall furnish to the party
receiving such payment all documentation necessary to prove the
proper amount to withhold of such taxes and to prove payment to the
tax authority of such required withholding.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement, as of the date first written hereinabove.
"PURCHASER" "SELLER"
Lakota Technologies, Inc.
/s/ Xxxx Xxxxxxx /s/ Xxx Xxxxxxxx
_______________________ ___________________________________
Xxxx Xxxxxxx By: Xxx Xxxxxxxx
Its: President
