AGREEMENT AND PLAN OF ACQUISITION
Exhibit
10.1
|
ACQUISITION
OF CARBON CAPTURE TECHNOLOGIES, INC.
by
|
AGREEMENT
AND PLAN OF ACQUISITION
This
Agreement and Plan of Acquisition
(Agreement) is entered into by and between Carbon Capture Technologies, Inc.,
a
Florida corporation, (CCTI), UTEK CORPORATION, a Delaware corporation, (UTEK),
and CSMG TECHNOLOGIES, Inc., a Texas corporation, (CTGI).
WHEREAS,
UTEK
owns 100% of the issued and outstanding shares of common stock of CCTI (CCTI
Shares); and
WHEREAS,
before
the Closing Date, CCTI will acquire the license for the fields of use as
described in the License Agreement which is attached hereto as part of Exhibit
A
and made a part of this Agreement (Agreements) and the rights to develop and
market a proprietary technology for the fields of uses specified in the License
Agreement (Technology).
WHEREAS,
the
parties desire to provide for the terms and conditions upon which CCTI will
be
acquired by CTGI in a stock-for-stock exchange (Acquisition) in accordance
with
the respective corporation laws of their state, upon consummation of which
all
CCTI Shares (as defined below) will be owned by CTGI, and all issued and
outstanding CCTI Shares will be exchanged for common stock of CTGI with terms
and conditions as set forth more fully in this Agreement; and
WHEREAS,
for
federal income tax purposes, it is intended that the Acquisition qualifies
as a
tax-free reorganization within the meaning of Section 368 (a)(1)(B) of the
Internal Revenue Code of 1986, as amended (Code).
NOW,
THEREFORE,
in
consideration of the premises and for other good and valuable consideration,
the
receipt, adequacy and sufficiency of which are by this Agreement acknowledged,
the parties agree as follows:
ARTICLE
1
THE
STOCK-FOR-STOCK ACQUISITION
| 1.01 |
The
Acquisition
|
(a) Acquisition
Agreement.
Subject
to the terms and conditions of this Agreement, at the Effective Date, as defined
below, all CCTI Shares shall be acquired from UTEK
by
CTGI
in
accordance with the respective corporation laws of their state and the
provisions of this Agreement and the separate corporate existence of CCTI shall
continue after the closing as a wholly-owned subsidiary of CTGI.
(b) Effective
Date.
The
Acquisition shall become effective (Effective Date or Closing Date) upon the
execution of this Agreement and closing of the transaction.
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1.02 Exchange
of Stock.
At the
Effective Date, by virtue of the Acquisition, all of the CCTI Shares that are
issued and outstanding at the Effective Date shall be exchanged for 371,020
unregistered shares of common stock of CTGI.
1.03 Effect
of Acquisition.
At and
after the Effective Date, the holder of each certificate of common stock of
CCTI
shall cease to have any rights as a shareholder of CCTI.
1.04 Closing.
Subject
to the terms and conditions of this Agreement, the Closing of the Acquisition
shall take place as of the last to sign and date this agreement.
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES
2.01 Representations
and Warranties of UTEK and CCTI.
UTEK and
CCTI represent and warrant to CTGI that the facts set forth below are true
and
correct, and will be true and correct as of the Effective Date:
(a) Organization.
CCTI and
UTEK are corporations duly organized, validly existing and in good standing
under the laws of their respective states of incorporation, and they have the
requisite power and authority to conduct their business and consummate the
transactions contemplated by this Agreement. True, correct and complete copies
of the articles of incorporation, bylaws and all corporate minutes of CCTI
have
been provided to CTGI and such documents are presently in effect and have not
been amended or modified.
(b) Authorization.
The
execution of this Agreement and the consummation of the Acquisition and the
other transactions contemplated by this Agreement have been duly authorized
by
the board of directors and shareholders of CCTI and the board of directors
of
UTEK; no other corporate action by the respective parties is necessary in order
to execute, deliver, consummate and perform their respective obligations
hereunder; and CCTI and UTEK have all requisite corporate and other authority
to
execute and deliver this Agreement and consummate the transactions contemplated
by this Agreement.
(c) Capitalization.
The
authorized capital of CCTI consists of 1,000,000 shares of common stock with
a
par value $.01 per share (CCTI Shares). At the date of this Agreement, 1,000
CCTI Shares are issued and outstanding and held of record and beneficially
by
UTEK, free and clear of all liens, encumbrances, restrictions and claims of
very
kind. UTEK has full legal right, power and authority to sell, assign transfer
and convey the CCTI shares so owned by UTEK in accordance with the terms and
conditions of this Agreement. The delivery to CTGI of the CCTI shares so owned
by UTEK pursuant to the provisions of this Agreement will transfer to CTGI
valid
title thereto, free and clear of any and all adverse claims. All issued and
outstanding CCTI Shares have been duly and validly issued and are fully paid
and
non-assessable shares and have not been issued in violation of any preemptive
or
other rights of any other person or any applicable laws. CCTI is not authorized
to issue any preferred stock. All dividends on CCTI Shares which have been
declared prior to the date of this Agreement have been paid in full. There
are
no outstanding options, warrants, commitments, calls or other rights or
agreements requiring CCTI to issue any CCTI Shares or securities convertible
into CCTI Shares to anyone for any reason whatsoever. None of the CCTI Shares
is
subject to any change, claim, condition, interest, lien, pledge, option,
security interest or other encumbrance or restriction, including any restriction
on use, voting, transfer, receipt of income or exercise of any other attribute
of ownership.
(d) Binding
Effect.
The
execution, delivery, performance and consummation of this Agreement, the
Acquisition and the transactions contemplated by this Agreement will not violate
any obligation to which CCTI or UTEK is a party and will not create a default
under any such obligation or under any agreement to which CCTI or UTEK is a
party. This Agreement constitutes a legal, valid and binding obligation of
CCTI,
enforceable in accordance with its terms, except as the enforcement may be
limited by bankruptcy, insolvency, moratorium, or similar laws affecting
creditor’s rights generally and by the availability of injunctive relief,
specific performance or other equitable remedies.
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(e) Litigation
Relating to this Agreement.
There
are no suits, actions or proceedings pending or, to the best of CCTI and UTEK’s
knowledge, information and belief, threatened, which seek to enjoin the
Acquisition or the transactions contemplated by this Agreement or which, if
adversely decided, would have a materially adverse effect on the business,
results of operations, assets or prospects of CCTI.
(f) No
Conflicting Agreements.
Neither
the execution and delivery of this Agreement nor the fulfillment of or
compliance by CCTI or UTEK with the terms or provisions of this Agreement nor
all other documents or agreements contemplated by this Agreement and the
consummation of the transaction contemplated by this Agreement will result
in a
breach of the terms, conditions or provisions of, or constitute a default under,
or result in a violation of, CCTI or UTEK’s articles of incorporation or bylaws,
the Technology, the License Agreement, or any agreement, contract, instrument,
order, judgment or decree to which CCTI or UTEK is a party or by which CCTI
or
UTEK or any of their respective assets is bound, or violate any provision of
any
applicable law, rule or regulation or any order, decree, writ or injunction
of
any court or government entity which materially affects their respective assets
or businesses.
(g) Consents.
No
consent from or approval of any court, governmental entity or any other person
is necessary in connection with execution and delivery of this Agreement by
CCTI
and UTEK or performance of the obligations of CCTI and UTEK hereunder or under
any other agreement to which CCTI or UTEK is a party; and the consummation
of
the transactions contemplated by this Agreement will not require the approval
of
any entity or person in order to prevent the termination of the Technology,
the
License Agreement, or any other material right, privilege, license or agreement
relating to CCTI or its assets or business.
(h) Title
to Assets.
CCTI has
or has agreed to enter into the agreements as listed on Exhibit A attached
hereto. These agreements and the assets shown on the balance sheet of attached
Exhibit B are the sole assets of CCTI. CCTI has or will by the Effective Date
have good and marketable title to its assets, free and clear of all liens,
claims, charges, mortgages, options, security agreements and other encumbrances
of every kind or nature whatsoever.
(i) Intellectual
Property.
(1) The
Board
of Regents (“Board”) of The University of Ottawa (“University”) respectively
owns and has license to the Technologies and has all right, power, authority
and
ownership and entitlement to file, prosecute and maintain in effect University
of Ottawa’s Patent Pending WO2006094411 & WO0000000000; Inventor: Xxxxxxxxxx
Xxxxxx, Ph.D.; titled “FUNCTIONALIZED ADSORBENT FOR REMOVAL OF ACID GASES AND
USE THEREOF” and “AMINE MODIFIED ADSORBENT, ITS PREPARATION AND USE FOR DRY
SCRUBBING OF ACID GASES”
(the
Patent) with respect to the inventions listed in Exhibit A hereto (the
Inventions).
(2) The
License Agreement between University and CCTI covering the Inventions will
be
legal, valid, binding and will be enforceable in accordance with its terms
as
contained in Exhibit A.
(3) Except
as
otherwise set forth in this Agreement, CTGI acknowledges and understands that
CCTI and UTEK make no representations and provide no assurances that the rights
to
the
Technology and Intellectual Property contained in the License Agreement do
not,
and will not in the future, infringe or otherwise violate the rights of third
parties, and as of this date;
(4) Neither
CCTI nor UTEK has received a written communication from any individual,
corporation, proprietorship, firm, general or limited partnership, limited
liability company, joint venture, trust, association, unincorporated
organization, governmental authority or other entity (“Person”) alleging that
the Technology and Intellectual Property contained in the License Agreement
violate any material rights relating to Intellectual Property of any
Person.
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(5) To
the knowledge of CCTI
and UTEK, and without any independent investigation, the validity or
enforceability of the Patent or any of the Technology and Intellectual Property
contained in the License Agreement, or the ownership thereof, has not been
questioned in any action, suit, arbitration, proceeding or other litigation
commenced or, to the Sellers’ knowledge, threatened by any Person or
governmental authority (“Proceeding”) and, to the knowledge of CCTI and UTEK, no
such Proceeding is currently threatened, and neither CCTI nor UTEK has received
a written communication from any Person (A) asserting an ownership interest
in
any of the Technology and Intellectual Property contained in the License
Agreement, or (B) alleging that any of the Technology and Intellectual Property
contained in the License Agreement is invalid or unenforceable.
(6) Except
as otherwise
expressly set forth in this Agreement, CCTI and UTEK make no representations
and
extend no warranties of any kind, either express or implied, including, but
not
limited to warranties of merchantability, fitness for a particular purpose,
non-infringement and validity of the Intellectual Property.
(j) Liabilities
of CCTI.
CCTI has
no assets, no liabilities or obligations of any kind, character or description
except those listed on the attached schedules and exhibits.
(k) Financial
Statements.
The
unaudited financial statements of CCTI, including a balance sheet, attached
as
Exhibit B and made a part of this Agreement, are, in all respects, complete
and
correct and present fairly CCTI’s financial position and the results of its
operations on the dates and for the periods shown in this Agreement; provided,
however, that interim financial statements are subject to customary year-end
adjustments and accruals that, in the aggregate, will not have a material
adverse effect on the overall financial condition or results of its operations.
CCTI has not engaged in any business not reflected in its financial statements.
There have been no material adverse changes in the nature of its business,
prospects, the value of assets or the financial condition since the date
of its
financial statements. There are no, and on the Closing Date there will be
no,
outstanding obligations or liabilities of CCTI except as specifically set
forth
in the financial statements and the other attached schedules and exhibits.
There
is no information known to CCTI or UTEK that would prevent the financial
statements of CCTI from being audited in accordance with generally accepted
accounting principles.
(l) Taxes.
All
returns, reports, statements and other similar filings required to be filed
by
CCTI with respect to any federal, state, local or foreign taxes, assessments,
interests, penalties, deficiencies, fees and other governmental charges or
impositions have been timely filed with the appropriate governmental agencies
in
all jurisdictions in which such tax returns and other related filings are
required to be filed; all such tax returns properly reflect all liabilities
of
CCTI for taxes for the periods, property or events covered by this Agreement;
and all taxes, whether or not reflected on those tax returns, and all taxes
claimed to be due from CCTI by any taxing authority, have been properly paid,
except to the extent reflected on CCTI’s financial statements, where CCTI has
contested in good faith by appropriate proceedings and reserves have been
established on its financial statements to the full extent if the contest
is
adversely decided against it. CCTI has not received any notice of assessment
or
proposed assessment in connection with any tax returns, nor is CCTI a party
to
or to the best of its knowledge, expected to become a party to any pending
or
threatened action or proceeding, assessment or collection of taxes. CCTI
has not
extended or waived the application of any statute of limitations of any
jurisdiction regarding the assessment or collection of any taxes. There are
no
tax liens (other than any lien which arises by operation of law for current
taxes not yet due and payable) on any of its assets. There is no basis for
any
additional assessment of taxes, interest or penalties. CCTI has made all
deposits required by law to be made with respect to employees’ withholding and
other employment taxes, including without limitation the portion of such
deposits relating to taxes imposed upon CCTI. CCTI is not and has never been
a
party to any tax sharing agreements with any other person or
entity.
(m) Absence
of Certain Changes or Events.
From the
date of the latest balance sheet of CCTI provided to CTGI until the Closing
Date, CCTI has not, and without the written consent of CTGI, it will not
have:
(1) Sold,
encumbered, assigned, let lapsed or transferred any of its material assets,
including without limitation the Intellectual Property, the License Agreement
or
any other material asset;
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(2) Amended
or terminated the License Agreement or other material agreement or done any
act
or omitted to do any act which would cause the breach of the License Agreement
or any other material agreement;
(3) Suffered
any damage, destruction or loss whether or not in control of CCTI;
(4) Made
any
commitments or agreements for capital expenditures or otherwise;
(5) Entered
into any transaction or made any commitment not disclosed to CTGI in writing;
(6) Incurred
any obligation or liability for borrowed money;
(7) Suffered
any other event of any character, which is reasonable to expect, would adversely
affect the future condition (financial or otherwise) of the assets or
liabilities or business of CCTI; or
(8) Taken
any
action, which could reasonably be foreseen to make any of the representations
or
warranties made by CCTI or UTEK untrue as of the date of this Agreement or
as of
the Closing Date.
(n) Material
Agreements.
Exhibit
A attached contains a true and complete list of all contemplated and executed
agreements between CCTI and a third party. A complete and accurate copy of
all
material agreements, contracts and commitments of the following types, whether
written or oral to which it is a party or is bound (Contracts), has been
provided to CTGI and such agreements are or will be at the Closing Date,
in full
force and effect without modifications or amendment and constitute the legally
valid and binding obligations of CCTI in accordance with their respective
terms
and will continue to be valid and enforceable following the Acquisition.
CCTI is
not in default of any of the Contracts. In addition:
(1) There
are
no outstanding unpaid promissory notes, mortgages, indentures, deed of trust,
security agreements and other agreements and instruments relating to the
borrowing of money by or any extension of credit to CCTI; and
(2) There
are
no outstanding operating agreements, lease agreements or similar agreements
by
which CCTI is bound; and
(3) The
complete final License Agreement will be provided to CTGI; and
(4) Except
as
set forth in (3) above, there are no outstanding licenses to or from others
of
any intellectual property and trade names; and
(5) There
are
no outstanding agreements or commitments to sell, lease or otherwise dispose
of
any of CCTI’s property; and
(6) There
are
no breaches of any agreement to which CCTI is a party.
(o) Compliance
with Laws.
CCTI is
in compliance with all applicable laws, rules, regulations and orders
promulgated by any federal, state or local government body or agency relating
to
its business and operations.
(p) Litigation.
There is
no suit, action or any arbitration, administrative, legal or other proceeding
of
any kind or character, or any governmental investigation pending or to the
best
knowledge of CCTI or UTEK, threatened against CCTI, the Technology, or License
Agreement, affecting its assets or business (financial or otherwise), and
neither CCTI nor UTEK is in violation of or in default with respect to any
judgment, order, decree or other finding of any court or government authority
relating to the assets, business or properties of CCTI or the transactions
contemplated hereby. There are no pending or threatened actions or proceedings
before any court, arbitrator or administrative agency, which would, if adversely
determined, individually or in the aggregate, materially and adversely affect
the assets or business of CCTI or the transactions contemplated.
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(q) Employees.
CCTI has
no and never had any employees. CCTI is not a party to or bound by any
employment agreement or any collective bargaining agreement with respect
to any
employees. CCTI is not in violation of any law, regulation relating to
employment of employees.
(r) Adverse
Effect.
Neither
CCTI nor UTEK has any knowledge of any or threatened existing occurrence,
action
or development that could cause a material
adverse
effect on CCTI or its business, assets or condition (financial or otherwise)
or
prospects.
(s) Employee
Benefit Plans.
CCTI
states that there are no and have never been any employee benefit plans,
and
there are no commitments to create any, including without limitation as such
term is defined in the Employee Retirement Income Security Act of 1974, as
amended, in effect, and there are no outstanding or un-funded liabilities
nor
will the execution of this Agreement and the actions contemplated in this
Agreement result in any obligation or liability to any present or former
employee.
(t) Books
and Records.
The
books and records of CCTI are complete and accurate in all material respects,
fairly present its business and operations, have been maintained in accordance
with good business practices, and applicable legal requirements, and accurately
reflect in all material respects its business, financial condition and
liabilities.
(u) No
Broker’s Fees.
Neither
UTEK nor CCTI has incurred any investment banking, advisory or other similar
fees or obligations in connection with this Agreement or the transactions
contemplated by this Agreement.
(v) Full
Disclosure.
All
representations or warranties of UTEK and CCTI are true, correct and complete
in
all material respects
to the best of our knowledge on
the date
of this Agreement and shall be true, correct and complete in all material
respects as of the Closing Date as if they were made on such date. No statement
made by them in this Agreement or in the exhibits to this Agreement or any
document delivered by them or on their behalf pursuant to this Agreement
contains an untrue statement of material fact or omits to state all material
facts necessary to make the statements in this Agreement not misleading in
any
material respect in light of the circumstances in which they were made.
2.02 Representations
and Warranties of CTGI.
CTGI
represents and warrants to UTEK and CCTI that to the best of its knowledge
the
facts set forth are true and correct.
(a) Organization.
CTGI is
a corporation duly organized, validly existing and in good standing under
the
laws of Texas, is qualified to do business as a foreign corporation in other
jurisdictions in which the conduct of its business or the ownership of its
properties require such qualification, and have all requisite power and
authority to conduct its business and operate properties.
(b) Authorization.
The
execution of this Agreement and the consummation of the Acquisition and the
other transactions contemplated by this Agreement have been duly authorized
by
the board of directors of CTGI; no other corporate action on their respective
parts is necessary in order to execute, deliver, consummate and perform their
obligations hereunder; and they have all requisite corporate and other authority
to execute and deliver this Agreement and consummate the transactions
contemplated by this Agreement.
(c) Capitalization. The
authorized capital of CTGI consists of 80,000,000
shares authorized and 39,124,638 and 38,717,238 issued and outstanding,
respectively of Common stock, par value $0.001 per share
(CTGI
Common Shares). On the Effective Date of the Acquisition, 39,495,868 CTGI
Common Shares (which will include the 371,020 CTGI Common Shares to be issued
at
the Closing of the Acquisition) will be issued and outstanding. The CTGI
Common
Shares outstanding have been duly and validly issued and are fully paid and
non-assessable shares and have not been issued in violation of any preemptive
or
other rights of any other person or any applicable laws.
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(d) Anti
Dilution Adjustments.
UTEK
currently owns zero (0) CTGI Common Shares, and will be acquiring
371,020 unregistered CTGI Common Shares; and based on a total of (39,495,868)
issued CTGI Common Shares (on an as converted basis) this total will
represent a 0.94% ownership position in CTGI Common shares as of June 24,
2008 on an “as if converted basis”. For a period of six months from the
Effective Date of this Agreement, the aggregate number of CTGI Common Shares
that UTEK has received shall be adjusted proportionately by the Board of
Directors of CTGI for any increase in the number of outstanding CTGI Common
Shares resulting from the issuance of any additional equity securities by
the
Company to any of its current list of management
and
directors as of the Effective Date, other than for previously agreed to
disbursements prior to the Effective Date of this agreement.
For
purposes in this Agreement, “as if converted basis” shall mean total outstanding
common shares after giving effect to the conversion of all outstanding equity
securities including preferred stock or other convertible
instruments.
(e) Binding
Effect.
The
execution, delivery, performance and consummation of the Acquisition and
the
transactions contemplated by this Agreement will not violate any obligation
to
which CTGI is a party and will not create a default hereunder, and this
Agreement constitutes a legal, valid and binding obligation of CTGI, enforceable
in accordance with its terms, except as the enforcement may be limited by
bankruptcy, insolvency, moratorium, or similar laws affecting creditor’s rights
generally and by the availability of injunctive relief, specific performance
or
other equitable remedies.
(f) Litigation
Relating to this Agreement.
There
are no suits, actions or proceedings pending or to its knowledge threatened
which seek to enjoin the Acquisition or the transactions contemplated by
this
Agreement or which, if adversely decided, would have a materially adverse
effect
on its business, results of operations, assets, prospects or the results
of its
operations of CTGI.
(g) No
Conflicting Agreements.
Neither
the execution and delivery of this Agreement nor the fulfillment of or
compliance by CTGI with the terms or provisions of this Agreement will result
in
a breach of the terms, conditions or provisions of, or constitute default
under,
or result in a violation of CTGI’s corporate charter or bylaws, or any
agreement, contract, instrument, order, judgment or decree to which it is
a
party or by which it or any of its assets are bound, or violate any provision
of
any applicable law, rule or regulation or any order, decree, writ or injunction
of any court or governmental entity which materially affects its assets or
business.
(h) Consents.
Assuming
the correctness of UTEK and CCTI’s representations, no consent from or approval
of any court, governmental entity or any other person is necessary in connection
with its execution and delivery of this Agreement; and the consummation of
the
transactions contemplated by this Agreement will not require the approval
of any
entity or person in order to prevent the termination of any material right,
privilege, license or agreement relating to CTGI or its assets or business.
(i) Financial
Statements.
The
financial statements of CTGI included in its reports available on the XXXXX
Website of the Securities and Exchange Commission on Form 10-QSB filed on
May
20, 2008 for the fiscal quarter ended March 31, 2008, together with all
subsequent filings made with the Commission available at the XXXXX website
(hereinafter referred to collectively as the Reports) contain all material
information relating to CTGI and its operations and financial condition as
of
their respective dates which information is required to be disclosed
therein. Since the date of the financial statements included in the
Reports, and except as modified in the Schedules hereto, there has been no
material adverse changes relating to CTGI’s business, financial condition or
affairs not disclosed in the Reports. The Reports do not contain any untrue
statement of a material fact or omit to state a material fact required to
be
stated therein or necessary to make the statements therein, taken as a whole,
not misleading in light of the circumstances when made.
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(j) Full
Disclosure.
All
representations or warranties of CTGI are true, correct and complete in all
material respects on the date of this Agreement and shall be true, correct
and
complete in all material respects as of the Closing Date as if they were
made on
such date. No statement made by them in this Agreement or in the exhibits
to
this Agreement or any document delivered by them or on their behalf pursuant
to
this Agreement contains an untrue statement of material fact or omits to
state
all material facts necessary to make the statements in this Agreement not
misleading in any material respect in light of the circumstances in which
they
were made.
(k) Compliance
with Laws.
CTGI is
in compliance in all material respects with all applicable laws, rules,
regulations and orders promulgated by any federal, state or local government
body or agency relating to its business and operations.
(l) Litigation.
There is
no suit, action or any arbitration, administrative, legal or other proceeding
of
any kind or character, or any governmental investigation pending or, to the
best
knowledge of CTGI, threatened against CTGI materially affecting its assets
or
business (financial or otherwise), and CTGI is not in violation of or in
default
with respect to any judgment, order, decree or other finding of any court
or
government authority. There are no pending or, to CTGI’s knowledge, threatened
actions or proceedings before any court, arbitrator or administrative agency,
which would, if adversely determined, individually or in the aggregate,
materially and adversely affect its assets or business. Except as disclosed
in
its Reports, CTGI has no knowledge of any existing or threatened occurrence,
action or development that could cause a material adverse affect on CTGI
or its
business, assets or condition (financial or otherwise) or
prospects.
(m) Development.
CTGI
agrees and warrants that it has the expertise necessary to and has had the
opportunity to independently evaluate the inventions of the Licensed Technology
and has the expertise necessary to develop same for the market.
(n) Investment
Company Status
CTGI is
not an investment company, either registered or unregistered.
2.03 Investment
Representations of UTEK.
UTEK
represents and warrants to CTGI that:
(a) General.
It has
such knowledge and experience in financial and business matters as to be
capable
of evaluating the risks and merits of an investment in CTGI Common Shares
pursuant to the Acquisition. It is able to bear the economic risk of the
investment in CTGI Common Shares, including the risk of a total loss of the
investment in CTGI Common Shares. The acquisition of CTGI Common Shares is
for
its own account and is for investment and not with a view to the distribution
of
this Agreement. Except a permitted by law, it has a no present intention
of
selling, transferring or otherwise disposing in any way of all or any portion
of
the shares at the present time. All information that it has supplied to CTGI
is
true and correct. It has conducted all investigations and due diligence
concerning CTGI to evaluate the risks inherent in accepting and holding the
shares which it deems appropriate, and it has found all such information
obtained fully acceptable. It has had an opportunity to ask questions of
the
officer and directors of CTGI concerning CTGI Common Shares and the business
and
financial condition of and prospects for CTGI, and the officers and directors
of
CTGI have adequately answered all questions asked and made all relevant
information available to them. UTEK is an accredited investor, as the term
is
defined in Regulation D, promulgated under the Securities Act of 1933, as
amended, and the rules and regulations thereunder.
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(b) Stock
Transfer Restrictions.
UTEK
acknowledges that the CTGI Common Shares will not be registered and UTEK
will
not be permitted to sell or otherwise transfer the CTGI Common Shares in
any
transaction in contravention of the following legend, which will be imprinted
in
substantially the following form on the stock certificate representing CTGI
Common Shares:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR UNDER THE SECURITIES LAWS
OF
ANY STATE. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED PURSUANT TO THE PROVISION
OF THE ACT AND THE LAWS OF SUCH STATES UNDER WHOSE LAWS A TRANSFER OF SECURITIES
WOULD BE SUBJECT TO A REGISTRATION REQUIREMENT, UNLESS UTEK CORPORATION HAS
OBTAINED AN OPINION OF COUNSEL STATING THAT SUCH DISPOSITION IS IN COMPLIANCE
WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
(c) Legend. Subject
to Rule 144 restrictions, 6 months following the stock acquisition described
herein, CTGI agrees to and shall direct its transfer agent to remove the
above legend upon the issuance by UTEK's legal counsel that the above legend
can
be removed from UTEK's CTGI Common Shares. CTGI agrees to and promptly
shall provide any information requested by UTEK or UTEK's counsel and to
make
further direction to its transfer agent as necessary for such issuance of
an
opinion regarding removal of the legend or the sale of such
restricted shares under Rule 144 or other available exemption from
registration.
(d) Wrongful
Delay.
In the
event that CTGI wrongfully fails to direct its transfer agent to remove the
legend within fifteen (15) days of request by UTEK, CTGI shall be liable
to an
additional fee of ten percent (10%) of the current value of the shares held
by
UTEK, determined based on the closing price of the shares on the fifteenth
day
after the request is deemed received by CTGI, as well as any and all attorney
fees and costs that UTEK may incur as a result of CTGI failing to comply
in this
request.
ARTICLE
3
TRANSACTIONS
PRIOR TO CLOSING
3.01 Corporate
Approvals.
Prior to
Closing Date, each of the parties shall submit this Agreement to its board
of
directors and if necessary, its respective shareholders and obtain approval
of
this Agreement. Copies of corporate actions taken by each party shall be
provided to the other party.
3.02 Access
to Information.
Each
party agrees to permit, upon reasonable notice, the attorneys, accountants,
and
other representatives of the other party’s reasonable access during normal
business hours to its properties and its books and records to make reasonable
investigations with respect to its affairs, and to make its officers and
employees available to answer questions and provide additional information
as
reasonably requested.
3.03 Expenses.
Each
party agrees to bear its own expenses in connection with the negotiation and
consummation of the Acquisition and the transactions contemplated by this
Agreement.
3.04 Covenants.
Except
as permitted in writing, prior to Closing each party agrees that it will:
(a) Use
its
good faith efforts to obtain all requisite licenses, permits, consents,
approvals and authorizations necessary in order to consummate the Acquisition;
and
(b) Notify
the other parties upon the occurrence of any event which would have a materially
adverse effect upon the Acquisition or the transactions contemplated by this
Agreement or upon the business, assets or results of operations;
and
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17
(c) Not
modify its corporate structure, except as necessary or advisable in order
to
consummate the Acquisition and the transactions contemplated by this
Agreement.
ARTICLE
4
CONDITIONS
PRECEDENT
The
obligation of the parties to consummate the Acquisition and the transactions
contemplated by this Agreement are subject to the following conditions that
may
be waived, to the extent permitted by law:
4.01. Each
party must obtain the approval of its board of directors and such approval
shall
not have been rescinded or restricted.
4.02. Each
party shall obtain all requisite licenses, permits, consents, authorizations
and
approvals required to complete the Acquisition and the transactions contemplated
by this Agreement.
4.03. There
shall be no claim or litigation instituted or threatened in writing by any
person or government authority seeking to restrain or prohibit any of the
contemplated transactions contemplated by this Agreement or challenges the
right, title and interest of UTEK in the CCTI Shares or the right of CCTI or
UTEK to consummate the Acquisition contemplated hereunder.
4.04. The
representations and warranties of the parties shall be true and correct in
all
material respects at the Effective Date.
4.05. The
Technology and Intellectual Property has been prosecuted in good faith with
reasonable diligence.
4.06. The
License Agreement will be valid and in full force and effect without any default
in this Agreement.
4.07. CTGI
shall have received, at or prior to the Closing Date, each of the
following:
(a) the
stock
certificates representing all of the currently issued and outstanding CCTI
Shares, duly endorsed (or accompanied by duly executed stock powers) by UTEK
for
transfer of such shares to CTGI;
(b) all
corporate records and documentation relating to CCTI’s business, all in a form
and substance satisfactory to CTGI, including its Articles of Incorporation
and
Bylaws;
(c) such
agreements, files and other data and documents pertaining to CCTI’s business as
CTGI may reasonably request;
(d) copies
of
the general ledgers and books of account of CCTI, and all federal, state
and
local income, franchise, property and other tax returns filed by CCTI since
the
inception of CCTI;
(e) certificates
of (i) the Secretary of State of the State of Florida as to the legal existence
and good standing, as applicable, (including tax) of CCTI in Florida;
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(f) the
original corporate minute books of CCTI, including the articles of incorporation
and bylaws of CCTI, and all other documents filed in this
Agreement;
(g) all
consents, assignments or related documents of conveyance to give CTGI the
benefit of the transactions contemplated hereunder;
(h) such
documents as may be needed to accomplish the Closing under the corporate
laws of
the states of incorporation of CTGI and CCTI, and
(i) such
other documents, instruments or certificates as CTGI, or their counsel may
reasonably request.
4.08. CTGI
shall have completed due diligence investigation of CCTI to CTGI’s satisfaction
in their sole discretion.
4.09. CTGI
shall receive the resignation effective the Closing Date of each director and
officer of CCTI.
ARTICLE
5
INDEMNIFICATION
AND LIABILITY
LIMITATION
5.01. Survival
of Representations and Warranties.
(a) The
representations and warranties made by UTEK and CCTI shall survive for a period
of 1 year after the Closing Date, and thereafter all such representation and
warranties shall be extinguished, except with respect to claims then pending
for
which specific notice has been given during such 1-year period.
(b) The
representations and warranties made by CTGI shall survive for a period of 1
year
after the Closing Date, and thereafter all such representations and warranties
shall be extinguished, except with respect to claims then pending for which
specific notice has been given during such 1-year period.
5.02 Limitations
on Liability.
CTGI
agrees that UTEK shall not be liable under this agreement to CTGI or their
respective successor’s, assigns or affiliates except where damages result
directly from the gross negligence or willful misconduct of UTEK or its
employees. In no event shall UTEK's liability exceed the total amount of the
fees paid to UTEK under this agreement, nor shall UTEK be liable for incidental
or consequential damages of any kind. CTGI shall indemnify UTEK, and hold UTEK
harmless against any and all claims by third parties for losses, damages or
liabilities, including reasonable attorneys fees and expenses (“Losses”),
arising in any manner out of or in connection with the rendering of services
by
UTEK under this Agreement, unless it is finally judicially determined that
such
Losses resulted from the gross negligence or willful misconduct of UTEK. The
terms of this paragraph shall survive the termination of this agreement and
shall apply to any controlling person, director, officer, employee or affiliate
of UTEK.
5.03 Indemnification.
CTGI
agrees to indemnify and hold harmless UTEK and its subsidiaries and affiliates
and each of its and their officers, directors, principals, shareholders, agents,
independent contactors and employees (collectively “Indemnified Persons”) from
and against any and all claims, liabilities, damages, obligations, costs and
expenses (including reasonable attorneys’ fees and expenses and costs of
investigation) arising out of or relating to matters arising from this
Agreement, except to the extent that any such claim, liability, obligation,
damage, cost or expense shall have been determined by final non-appealable
order
of a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the Indemnified Person or Persons in respect of whom
such liability is asserted.
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of 17
(a) Limitation
of Liability.
CTGI
agrees that no Indemnified Person shall have any liability as a result of
the
execution and delivery of this Agreement, or other matters relating to or
arising from this Agreement, other than liabilities that shall have been
determined by final non-appealable order of a court of competent jurisdiction
to
have resulted from the gross negligence or willful misconduct of the Indemnified
Person or Persons in respect of whom such liability is asserted. Without
limiting the generality of the foregoing, in no event shall any Indemnified
Person be liable for consequential, indirect or punitive damages, damages
for
lost profits or opportunities or other like damages or claims of any kind.
In no
event shall UTEK's liability exceed the total amount of the consideration
paid
to UTEK under this Agreement.
(b) Limitation
of Liability.
UTK
agrees that CTGI shall not be liable under this agreement to UTK or their
respective successor’s, assigns or affiliates except where damages result
directly from the gross negligence or willful misconduct of CTGI or its
employees. In no event shall CTGI's liability exceed the total amount of
the
fees paid by CTGI under this agreement, nor shall CTGI be liable for incidental
or consequential damages of any kind. UTK shall indemnify CTGI, and hold
CTGI
harmless against any and all claims by third parties for losses, damages
or
liabilities, including reasonable attorneys fees and expenses (“Losses”),
arising in any manner out of or in connection with the rendering of services
by
CTGI under this Agreement, unless it is finally judicially determined that
such
Losses resulted from the gross negligence or willful misconduct of CTGI.
The
terms of this paragraph shall survive the termination of this agreement and
shall apply to any controlling person, director, officer, employee or affiliate
of CTGI.
ARTICLE
6
REMEDIES
6.01 Specific
Performance.
Each
party’s obligations under this Agreement are unique. If any party should default
in its obligations under this Agreement, the parties each acknowledge that
it
would be extremely impracticable to measure the resulting damages. Accordingly,
the non-defaulting party, in addition to any other available rights or remedies,
may xxx in equity for specific performance, and the parties each expressly
waive
the defense that a remedy in damages will be adequate.
6.02 Costs.
If any
legal action or any arbitration or other proceeding is brought for the
enforcement of this Agreement or because of an alleged dispute, breach, default,
or misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing party or parties shall be entitled to recover
reasonable attorneys’ fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be
entitled.
ARTICLE
7
ARBITRATION
In
the
event a dispute arises with respect to the interpretation or effect of this
Agreement or concerning the rights or obligations of the parties to this
Agreement, the parties agree to negotiate in good faith with reasonable
diligence in an effort to resolve the dispute in a mutually acceptable manner.
Failing to reach a resolution of this Agreement, either party shall have the
right to submit the dispute to be settled by arbitration under the Commercial
Rules of Arbitration of the American Arbitration Association. The parties agree
that, unless the parties mutually agree to the contrary such arbitration shall
be conducted in the State of Florida. The cost of arbitration shall be borne
by
the party against whom the award is rendered or, if in the interest of fairness,
as allocated in accordance with the judgment of the arbitrators. All awards
in
arbitration made in good faith and not infected with fraud or other misconduct
shall be final and binding. The arbitrators shall be selected as follows: one
by
CTGI, one by UTEK and a third by the two selected arbitrators. The third
arbitrator shall be the chairman of the panel.
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ARTICLE
8
MISCELLANEOUS
8.01. No
party
may assign this Agreement or any right or obligation of it hereunder without
the
prior written consent of the other parties to this Agreement. No permitted
assignment shall relieve a party of its obligations under this Agreement without
the separate written consent of the other parties.
8.02. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective permitted successors and assigns.
8.03. Each
party agrees that it will comply with all applicable laws, rules and regulations
in the execution and performance of its obligations under this Agreement.
8.04. This
Agreement shall be governed by and construct in accordance with the laws of
the
State of Delaware without regard to principles of conflicts of law.
8.05. This
document constitutes a complete and entire agreement among the parties with
reference to the subject matters set forth in this Agreement. No statement
or
agreement, oral or written, made prior to or at the execution of this Agreement
and no prior course of dealing or practice by either party shall vary or modify
the terms set forth in this Agreement without the prior consent of the other
parties to this Agreement. This Agreement may be amended only by a written
document signed by the parties.
8.06. Notices
or other communications required to be made in connection with this Agreement
shall be sent by U.S. mail, certified, return receipt requested, personally
delivered or sent by express delivery service and delivered to the parties
at
the addresses set forth below or at such other address as may be changed from
time to time by giving written notice to the other parties.
8.07. The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement.
8.08. This
Agreement may be executed in multiple counterparts, each of which shall
constitute one and a single Agreement.
8.09. Any
facsimile signature of any part to this Agreement or to any other agreement
or
document executed in connection of this Agreement should constitute a legal,
valid and binding execution by such parties.
(Signatures
on the next page)
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|
CARBON
CAPTURE TECHNOLOGIES, INC.
|
|
|
By:
/s/ Xxxxxx X. Xxxxxxx
|
By:
/s/ Xxxx Xxxxxxx
|
|
Xxxxxx
X.
Xxxxxxx,
|
Xxxx
Xxxxxxx
|
|
Chief
Executive
Officer
|
President
|
|
Address:
|
Address:
|
|
000
Xxxxx Xxxxx,
000 X. Xxxxxxxxx
|
0000
Xxxx Xxxx
Xxxxxx
|
|
Xxxxxx
Xxxxxxx, XX
00000
|
Xxxxx,
Xxxxxxx
00000
|
|
Date:
6/24/08
|
Date:
6/24/08
|
|
UTEK
CORPORATION
|
|
|
By:
/s/ Xxxxxxxx X. Xxxxx, Ph.D.
|
|
|
Xxxxxxxx
X. Xxxxx,
Ph.D.
|
|
|
Chief
Executive
Officer
|
|
|
Address:
|
|
|
0000
Xxxx Xxxx
Xxxxxx
|
|
|
Xxxxx,
Xxxxxxx
00000
|
|
|
Date:
6/24/08
|
Page
14
of 17
EXHIBIT
A
Outstanding
Agreements
From
the
University of Ottawa
| 1) |
License
Agreement
|
Page
15
of 17
EXHIBIT
B
CARBON
CAPTURE TECHNOLOGIES,
INC.
Financial
Statements as of
June
___, 2008
Page
16
of 17
EXHIBIT
C
Form
10QSB for CSMG TECHNOLOGIES, INC.
31
March - 2008
Quarterly
Report
Page
17
of 17
