Exhibit 10.1
SERIES A PURCHASE AGREEMENT
THIS SERIES A PURCHASE AGREEMENT (this "Agreement") is made and entered
into this 30th day of January, 2004, by and between GLOBAL ENERGY GROUP, INC.
(the "Company"), a Delaware corporation; GLOBAL ENERGY ACQUISITION GROUP, L.L.C.
("GEAG"), an Oklahoma limited liability company; and ____________, a________
("Purchaser"). Reference is made to that certain Series A Purchase Agreement
dated on or about January 9, 2004 (the "Prior Agreement") between the parties to
this Agreement. This Agreement supersedes and replaces the Prior Agreement. The
Prior Agreement is hereby terminated and of no further force or effect.
BACKGROUND INFORMATION
The Company and Purchaser desire that Purchaser make an investment in
the Company in the form of purchases of shares of the Company's 6% Redeemable
Preferred Stock, Series A ("Series A Preferred").
ARTICLE I
SERIES A PURCHASES
Section 1.1. Old Money Purchase.
(a) The parties acknowledge that Purchaser has made
certain loans and advances, and/or has permitted the Company to defer payment of
obligations owing by the Company to Purchaser, to or for the benefit of the
Company, and that the Company is indebted to Purchaser with respect to such
amounts, including interest thereon ("Old Loans") with respect to which
Purchaser has been issued promissory notes ("Old Notes") and stock purchase
warrants ("Old Warrants"). The parties agree that, as of the date hereof, the
aggregate amount owed by the Company to Purchaser with respect to the Old Loans
is $_________, and the number of shares of Common Stock covered by the Old
Warrants is _________.
(b) On the earliest practicable date (the "Effective
Date") on or after the first date as of which the Certificate of Designation for
the Series A Preferred, in substantially the form attached as Exhibit A, has
been filed with the Secretary of State of the State of Delaware, Purchaser shall
purchase, and the Company shall issue and sell to Purchaser, at a price of $1.00
per share, a number of shares of Series A Preferred equal to the aggregate
number of dollars (rounded to the nearest whole dollar) then owed to Purchaser
under and with respect to all Old Loans, including accrued but unpaid interest.
The purchase price for such shares shall be paid by delivery for cancellation of
all Old Notes and acknowledgment of cancellation and satisfaction of any Old
Loans not represented by promissory notes, such consideration to be valued for
these purposes at the amount owing with respect thereto, including accrued but
unpaid interest, and the number of shares of Series A Preferred issued and sold
under this paragraph shall be the maximum number of shares that can be purchased
in exchange for the Old Loans valued as provided above. In connection with and
as additional consideration for such purchases, Purchaser shall deliver all Old
Warrants for cancellation. For these purposes, all Old Warrants together shall
be valued at $1.00 in the aggregate.
Section 1.2. Share Certificates. With respect to the purchase of shares
pursuant to this Agreement, Purchaser shall be entitled to receive a
certificate, in the form approved by the Company's Board of Directors,
representing such shares, such certificate to be issued at or promptly after the
closing of the related purchase ("Closing").
Section 1.3. Warrants. As additional consideration for each purchase of
shares pursuant to this Agreement, and as an inducement to Purchaser to make
each such purchase, at the Closing the Company shall execute and deliver to
Purchaser a Warrant ("New Warrant") in the form of Exhibit B, which New Warrant
shall. cover a number of shares ("New Warrant Shares") of the Company's common
stock, par value $.001 per share ("Common Stock"), equal to ten (10) times the
number of shares then being purchased by Purchaser.
Section 1.4. Restriction on Transfer. Purchaser does hereby covenant
and agree that, prior to the third anniversary of the date of the Closing,
Purchaser shall not, directly or indirectly, grant, pledge, hypothecate,
bargain, sell or otherwise transfer or dispose of any right, title or interest
in, to or under any shares of Series A Preferred, any New Warrants, or any New
Warrant Shares, without the prior written consent of GEAG and the Company.
Section 1.5. Participation in GEDG. As an additional inducement to
Purchaser to enter into and perform its obligations under this Agreement, GEAG
agrees that it shall cause its affiliate Global Energy Distribution Group,
L.L.C. ("GEDG"), an Oklahoma limited liability company, to offer to issue and
sell to purchaser a _________ percent (____%) equity interest in GEDG for a
purchase price of $_______. Purchaser represents and warrants that (1) the GEDG
securities to be received by Purchaser will be acquired for investment for
Purchaser's own account, not as a nominee or agent, and not with a view to the
resale or distribution of any part thereof, (2) Purchaser has no present
intention of selling or otherwise distributing, and does not have any contract,
undertaking, agreement or arrangement with any person with respect to any sale
or other transfer of, any such securities, (3) Purchaser and/or its controlling
persons are investors in securities of companies in the development stage, and
Purchaser acknowledges that it is able to protect its own interests, can bear
the economic risk of the loss of its entire investment, and has such knowledge
and experience in financial or business matters that it is capable of evaluating
the merits and risks of the investment in GEDG and its securities, and (4)
Purchaser has received all documents and information desired by it in connection
with an investment in GEDG, has had ample opportunity to ask questions of and
receive answers from management of GEDG, and has otherwise performed its due
diligence investigation of GEDG. [This Section included for Quest and Xxxxx
only]
ARTICLE II
COMPANY REPRESENTATIONS AND WARRANTIES
The Company does hereby represent and warrant to Purchaser as follows:
Section 2.1. Organization. The Company is duly organized, validly
existing and in good standing under the laws of the State of Delaware, has all
requisite corporate power to own, lease and operate its properties and to carry
on its business as now being conducted.
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Section 2.2. Authority; No Conflict; Required and Consents.
(a) The Company has all requisite corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery, of this Agreement
and the consummation of the transactions contemplated hereby by the Company have
been duly authorized by all necessary corporate action on the part of the
Company. This Agreement has been duly executed and delivered by the Company and
constitutes the valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles (the "Bankruptcy and Equity Exception").
(b) Except as has been disclosed by the Company or its
representatives to Purchaser prior to execution of this Agreement, the execution
and delivery of this Agreement does not, and the consummation of the
transactions contemplated hereby and thereby will not, (i) conflict with, or
result in any violation or breach of, the Certificate of Incorporation or Bylaws
of the Company, (ii) result in any violation or breach of, or constitute (with
or without notice or lapse of time, or both) a default (or give rise to a right
of termination, cancellation or acceleration of any obligation or loss of any
material benefit) under, or require a consent or waiver under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, loan,
credit agreement, contract or other agreement, instrument or obligation to which
the Company is a party or by which the Company or any of its properties or
assets may be bound, or (iii) conflict with, violate, or cause the termination
of any instrument, permit, concession, franchise, license, judgment, order,
decree, statute, law, ordinance, rule or regulation applicable to the Company or
any of its properties or assets, except, in the case of (ii) and (iii), for any
such conflicts, violations, defaults, terminations, cancellations or
accelerations which are not, individually or in the aggregate, reasonably likely
to have a material adverse effect on the Company or its assets, financial
condition, results of operations, and prospects (a "Material Adverse Effect").
(c) No consent, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency or
commission or other governmental authority or instrumentality ("Governmental
Entity") is required by or with respect to the Company in connection with the
execution and delivery of this Agreement or the consummation of the transactions
contemplated hereby except for such consents, authorizations, filings, approvals
and registrations which, if not obtained or made, would not be reasonably likely
to have a Material Adverse Effect.
Section 2.3. SEC Filings; Financial Statements.
(a) During the last twelve months, and except to the
extent that the failure to do so would not be reasonably likely to have a
Material Adverse Effect, the Company has filed all forms, reports, registration
statements, prospectuses, schedules, statements and documents, including the
exhibits thereto, required to be filed by the Company with the U.S. Securities
and Exchange Commission ("SEC") under the Securities Act or the Exchange Act,
including without limitation the Exchange Act Filings (these forms, reports,
registration statements, prospectuses, schedules, statements and documents,
including the exhibits thereto, are referred to collectively
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as "Company SEC Reports"). Each Company SEC Report (i) at the time filed
complied in all material respects with the applicable requirements of the
Securities Act and the Exchange Act, as the case may be, and (ii) did not at the
time filed (or if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing) contain any untrue statement of a
material fact or omit to state a material fact required to be stated in such
Company SEC Report or necessary in order to make the statements in such Company
SEC Report, in the light of the circumstances under which they were made, not
misleading. The Company shall be deemed for all purposes to have disclosed to
Purchaser, a reasonable period of time prior to the execution of this Agreement,
all information contained in the Company SEC Reports.
(b) Each of the consolidated financial statements
(including, in each case, any related notes) contained in the Company SEC
Reports, as of the date of the applicable Company SEC Report (collectively, the
"Company SEC Financial Statements") complied as to form in all material respects
with the applicable published rules and regulations of the SEC with respect
thereto, were prepared in accordance with U.S. generally accepted accounting
principles applied on a consistent basis throughout the periods involved (except
as may be indicated in the notes to such financial statements or in the Company
SEC Reports or, in the case of unaudited interim financial statements, as
permitted by Form 10-QSB of the SEC) and fairly presented the consolidated
financial position of the Company and its subsidiaries as of the dates and the
consolidated results of its operations and cash flows for the periods indicated.
Section 2.4. Capital Structure. The authorized capital stock of the
Company is as set forth in the Company SEC Reports. As of the date of execution
of this Agreement by the Company, (1) 13,800,707 shares of Common Stock are
issued and outstanding, (2) all such issued and outstanding shares of Common
Stock are duly authorized, validly issued, fully paid and nonassessable, (3)
there are issued and outstanding options and warrants to purchase up to an
additional 10,922,158 shares of Common Stock, and (4) no other shares of capital
stock of the Company (or rights to purchase any such capital stock) are
outstanding. The shares of Series A Preferred to be issued under this Agreement,
when issued pursuant to the terms of this Agreement, will be duly authorized,
validly issued, fully paid and nonassessable.
Section 2.5. No Undisclosed Liabilities. Except as has been disclosed
to Purchaser in prior to execution of this Agreement, and except for normal or
recurring liabilities incurred since the date of the financial statements
included in the Company's most recent quarterly report on Form 10-QSB filed with
the SEC, the Company does not have any liabilities, either accrued, contingent
or otherwise (whether or not required to be reflected in financial statements in
accordance with GAAP), and whether due or to become due, which individually or
in the aggregate, have had or will have a Material Adverse Effect.
Section 2.6. Absence of Certain Changes or Events. Except as disclosed
in the Company SEC Reports that have been filed and are publicly available prior
to the date hereof, since the date of the financial statements included in the
Company's most recent quarterly report on Form 10-QSB filed with the SEC, the
Company has conducted its business only in the ordinary course and in a manner
consistent with recent past practice and, since such date, there has not been
(i) any change in the financial condition, results of operations, business,
prospects, assets or properties of the Company and its subsidiaries, taken as a
whole, that has had, or will have, a Material Adverse Effect, (ii) any damage,
destruction or loss (whether or not covered by insurance) with respect to the
Company or any of its subsidiaries that has had, or will
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have, a Material Adverse Effect, (iii) any material change by the Company in its
accounting methods, principles or practices; or (iv) any revaluation by the
Company of any of its assets or liabilities that has had, or will have, a
Material Adverse Effect.
ARTICLE III
PURCHASER REPRESENTATIONS AND WARRANTIES
Purchaser does hereby represent and warrant to the Company as follows:
Section 3.1. Organization or Status. Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Missouri.
Section 3.2. Authority; No Conflict; Required Filings and Consents.
(a) Purchaser has all requisite power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by Purchaser have been duly
authorized by all necessary action on the part of Purchaser. This Agreement has
been duly executed and delivered by Purchaser and constitutes the valid and
binding obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, subject to the Bankruptcy and Equity Exception.
(b) Except as has been disclosed by Purchaser or its
representatives to the Company prior to execution of this Agreement, the
execution and delivery of this Agreement does not, and the consummation of the
transactions contemplated hereby and thereby will not, (i) if Purchaser is an
entity, conflict with, or result in any violation or breach of, the
organizational documents of Purchaser, (ii) result in any violation or breach
of, or constitute (with or without notice or lapse of time, or both) a default
(or give rise to a right of termination, cancellation or acceleration of any
obligation or loss of any material benefit) under, or require a consent or
waiver under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, lease, loan, credit agreement, contract or other agreement,
instrument or obligation to which Purchaser is a party or by which Purchaser or
any of its properties or assets may be bound, or (iii) conflict with, violate,
or cause the termination of any instrument, permit, concession, franchise,
license, judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to Purchaser or any of its properties or assets, except, in the case
of (ii) and (iii), for any such conflicts, violations, defaults, terminations,
cancellations or accelerations which are not, individually or in the aggregate,
material.
(c) No material consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental Entity is
required by or with respect to Purchaser in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby.
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Section 3.3. Investor Matters. The securities to be received by
Purchaser will be acquired for investment for Purchaser's own account, not as a
nominee or agent, and not with a view to the resale or distribution of any part
thereof. Purchaser has no present intention of selling or otherwise
distributing, and does not have any contract, undertaking, agreement or
arrangement with any person with respect to any sale or other transfer of, any
such securities. Purchaser and/or its controlling persons are investors in
securities of companies in the development stage, and Purchaser acknowledges
that it is able to protect its own interests, can bear the economic risk of the
loss of its entire investment, and has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Company and the securities being purchased
hereunder. Purchaser has received all documents and information desired by it in
connection with an investment in the Company, has had ample opportunity to ask
questions of and receive answers from management of the Company, and has
otherwise performed its due diligence investigation of the Company.
ARTICLE IV
MISCELLANEOUS PROVISIONS
Section 4.1. Severability. If any term or other provision of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal or
incapable of being enforced in any particular respect or under any particular
circumstance, such term or provision shall nevertheless remain in full force and
effect in all other respects and under all other circumstances, and all other
terms, conditions and provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner, to the end
that the transactions contemplated hereby are fulfilled to the fullest extent
possible.
Section 4.2. Waiver. The failure of any party to insist upon strict
performance of any of the terms or conditions of this Agreement will not
constitute a waiver of any of its rights hereunder.
Section 4.3. Binding Agreements; No Third Party Beneficiaries; No
Assignability. Each of the provisions and agreements herein contained shall be
binding upon and inure to the benefit of the respective parties hereto, as well
as their successors, but no statement contained herein is intended to confer
upon any person or entity, other than the parties hereto and their successors in
interest and permitted assignees, any rights or remedies under or by reason of
this Agreement unless so stated to the contrary. No right under this Agreement
shall be assignable nor any duty delegable by any party, except as expressly
authorized in this Agreement, without the prior consent of each other party.
Section 4.4. Counterparts. This Agreement may be executed in any number
of counterparts, by means of multiple signature pages each containing less than
all required signatures, and by means of facsimile signatures, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
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Section 4.5. Construction. As used herein, unless the context otherwise
requires: (i) references to "Article" or "Section" are to an article or section
hereof; (ii) all references to "Exhibits" are to Exhibits attached hereto and
are incorporated herein by reference and made a part hereof; (iii) "include",
"includes" and "including" are deemed to be followed by "without limitation"
whether or not they are in fact followed by such words or words of like import;
(iv) the headings of the various articles, sections and other subdivisions
hereof are for convenience of reference only and are in no way intended to, and
shall not be deemed to, describe, interpret, define, modify or limit the scope,
extent or intent of this Agreement or any of the terms or provisions of this
Agreement; and (v) words of gender used herein may be read as masculine,
feminine, or neuter, as required by context, and words of number may be read as
singular or plural, as similarly required.
Section 4.6. Modification. Any modification or waiver of any provision
of this Agreement, or any consent to any departure by any party from the terms
hereof, shall not be effective in any event unless the same is in writing and
signed by all the parties hereto, and then such modification, waiver or consent
shall be effective only in the specific instance and for the specific purpose
given. Any notice to or demand on any party hereto in any event not specifically
required hereunder shall not entitle the party receiving such notice or demand
to any other or further notice or demand in the same, similar or other
circumstances unless specifically required hereunder.
Section 4.7. Further Assurances. Each party to this Agreement promptly
will execute and deliver such further instruments and agreements and do such
further acts and things as may be reasonably requested in writing by any other
party hereto that may be necessary or desirable in order to effect fully the
purposes of this Agreement.
Section 4.8. Notices. Unless otherwise specifically provided herein,
any notice delivered under this Agreement shall be in writing addressed to the
respective party at the address on file with the Company and may be personally
served, telecopied or sent by overnight courier service and shall be deemed to
have been given (a) if delivered in person, when delivered; (b) if delivered by
telecopy, on the date of transmission if transmitted on a business day before
4:00 p.m. (Tampa, Florida time) or, if not, on the next succeeding business day;
or (c) if delivered by overnight courier, one business day after delivery to
such courier properly addressed. Notice to any party shall be addressed to such
party at the address on file with the Company, or to such other address as the
party addressed shall have previously designated by written notice to the
serving party, given in accordance with this Section.
Section 4.9. Applicable Law. This Agreement shall be governed by and
shall be construed and enforced in accordance with the internal laws of the
State of Delaware, without regard to conflicts of law principles.
Section 4.10. Consent to Jurisdiction. Each party consents to the
jurisdiction of any state or federal court sitting in the district or circuit in
which is located the Company's offices in Odessa, Florida. Each party expressly
submits and consents to the jurisdiction of the aforesaid courts and waives any
defense of forum non conveniens. Each party hereby waives personal service of
any and all process and agrees that all such service of process may be made upon
it by
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certified or registered mail, return receipt requested, addressed to the parties
at their respective addresses set forth in this Agreement.
Section 4.11. Opportunity to Cure Defaults. Upon any breach of or
default under this Agreement by any party, no action shall be taken with respect
thereto against the breaching or defaulting party unless and until such breach
or default remains uncured thirty (30) days after written notice thereof to the
party in breach or default.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
GLOBAL ENERGY GROUP, INC. GLOBAL ENERGY ACQUISITION
GROUP, L.L.C.
By: _______________________ By: ______________________________
Name: Xxxx X. Xxxxxx Name:
Its: EVP and CFO Its:
___________________________
By: _______________________
Name:
Its:
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Exhibit A
FORM OF CERTIFICATE OF DESIGNATION
Series A Purchase Agreement
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