STOCK PURCHASE AGREEMENT
STOCK
PURCHASE AGREEMENT, dated as of January 10, 2007 (this “Agreement”),
by
and among XXXX XXXXXX (“Seller”);
AVENEL FINANCIAL GROUP, INC. (“Purchaser”)
and
TRIPLE BAY INDUSTRIES, a Florida corporation (“Company”).
WITNESSETH
WHEREAS,
Seller desires to sell to Purchaser 15,000,000 shares of the Company’s common
stock, no par value (the “Common
Stock”)
(the
“Shares”),
representing 98% of the Company’s issued and outstanding shares of the Common
Stock of the Company, on the terms and conditions set forth in this Stock
Purchase Agreement (“Agreement”),
and
WHEREAS,
Purchaser desires to buy the Shares on the terms and conditions set forth
herein, and
WHEREAS
the Company joins in the execution of this Agreement for the purpose of
evidencing its consent to the consummation of the foregoing transactions and
for
the purpose of making certain representations and warranties to and covenants
and agreements with the Purchaser.
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
1.1 Sale
of the Shares.
Subject
to the terms and conditions herein set forth, on the basis of the
representations, warranties and agreements herein contained, at the Closing
Seller agrees to sell, assign, transfer and deliver the Shares to Purchaser,
and
Purchaser agrees to purchase the Shares from the Seller.
1.2 The
Closing.
The
purchase of the Shares shall take place at the office of Xxxxxxx Xxxxx LLP,
counsel to the Purchaser or such other place as Purchaser and Seller may
mutually agree as soon as practicable after all conditions to closing set forth
herein have been satisfied, herein referred to as the “Closing
Date”.
1.3 Instruments
of Conveyance and Transfer.
At the
Closing, Seller shall deliver certificates representing the Shares to Purchaser
duly endorsed by the Seller to the Purchaser, in form and substance satisfactory
to Purchaser (“Certificates”),
as
shall be effective to vest in Purchaser all right, title and interest in and
to
all of the Shares. See Article 8 below.
1.4 Consideration
and Payment for the Shares.
In
consideration for the Shares, Purchaser shall pay to the Seller a total purchase
price of $649,000 (the “Purchase
Price”).
1.5 Conditions
to Closing.
Purchaser’s obligation to close shall be conditional upon the completion to
Purchaser’s satisfaction of the following matters:
(a) Completion
to Purchaser’s satisfaction of its review of the Form 10-KSB of the Company for
the year ended December 31, 2006;
(b) The
Company being in good standing and existence under Florida law with all
franchise taxes current;
(c) The
Company shall have paid or satisfied all obligations to which it is a party,
all
obligations to Jendco or Seller, and all obligations to IMM, other than routine
accounts payable incurred in the ordinary course of business not more than
45
days old;
(d) At
the
time of Closing, the accounts receivable of the Company that are not more than
45 days old shall equal or exceed the account of the Company’s accounts
payable;
(e) Completion
of the audit of the financial statements of the Company for each of the two
fiscal years ended December 31, 2006, and the filing by the Company of its
Form 10-KSB for the 2006 fiscal year.
1.6 Escrow.
The
Purchase Price has been deposited with Xxxx X. Xxxx, PC to be sent at
Closing by wire transfer as directed by Seller, with the certificates
representing the Shares being deposited with Xxxx X. Xxxx, PC and released
to Purchaser by Xxxx X. Xxxx, PC at the time the Purchase Price is released
to Seller. Xxxx X. Xxxx, PC will execute a counterpart of this Agreement or
a
separate letter acknowledging his responsibilities.
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES OF THE SELLER
The
Seller represents, warrants and undertakes to the Purchaser that, except as
set
forth in the Disclosure Schedule:
2.1 Transfer
of Title.
Seller
shall transfer all right, title and interest 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 or nature
whatsoever, whether direct or indirect or contingent.
(a) Due
Execution.
This
Agreement has been duly executed and delivered by the Seller.
(b) Valid
Agreement.
This
Agreement constitutes, and upon execution and delivery thereof by the Seller,
will constitute, a valid and binding agreement of the Seller enforceable against
the Seller in accordance with its terms.
(c) Authorization.
The
execution, delivery and performance by the Seller of this Agreement and the
delivery by the Seller of the Shares have been duly and validly authorized
by
the Company, and no further consent or authorization of the Seller, the Company,
its Board of Directors, or its stockholders is required.
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(d) Seller’s
Title to Shares; No Liens or Preemptive Rights; Valid Issuance.
Seller
has and at the Closing will have good and valid title and control of the Shares;
there will be no existing impediment or encumbrance to the sale and transfer
of
such Shares to the Purchaser; and on delivery to the Purchaser of the Shares,
good and valid title to all the Shares will pass to Purchaser and all of the
Shares will be free and clear of all taxes, liens, security interests, pledges,
rights of first refusal or other preference rights, encumbrances, charges,
restrictions (other than resale restrictions under federal and state securities
laws), demands, claims or assessments of any kind or any nature whatsoever
whether direct, indirect or contingent and shall not be subject to preemptive
rights, tag-along rights, or similar rights of any of the stockholders of the
Company. The Shares have been legally and validly issued in compliance with
all
applicable U.S. federal and state securities laws, and are fully paid and
non-assessable shares of the Company’s Common Stock; and the Shares have all
been issued under duly authorized resolutions of the Board of Directors of
the
Company. At the Closing, pursuant to Section 1.6
Seller
shall deliver to the Purchaser Certificates representing the Shares free and
clear of all liens, security interests, pledges, encumbrances, charges,
restrictions, demands or claims in any other party whatsoever with appropriate
stock powers with medallion guarantees.
2.2 No
Governmental Action Required.
The
execution and delivery by the Seller of this Agreement does not and will not,
and the consummation of the transactions contemplated hereby will not, require
any action by or in respect of, or filing with, any governmental body, agency
or
governmental official, other than disclosure reports required by the laws and
rules of the SEC.
2.3 Compliance
with Applicable Law and Corporate Documents.
The
execution and delivery by the Seller and the Company of this Agreement does
not
and will not, and the sale by the Seller of the Shares and the consummation
of
the other transactions contemplated by this Agreement does not and will not
contravene or constitute a default under or violation of (i) any provision
of
applicable law or regulation, (ii) the articles of incorporation or by-laws
of
the Company or (iii) any agreement, judgment, injunction, order, decree or
other
instrument binding upon the Seller or any of his or the Company’s assets, or
result in the creation or imposition of any lien on any asset of the
Seller.
2.4 Not
a
Voting Trust: No Proxies.
None of
the Shares is or will be subject to any voting trust or agreement. No person
holds or has the right to receive any proxy or similar instrument with respect
to the Shares. Except for the agreement with IMM disclosed in the Company’s SEC
reports, which will be satisfied by Purchaser making a capital contribution
to
the Company in the amount of $16,000 at Closing, deposited with Xx. Xxxx, and
the IMM debt of $16,000 being paid therefrom by Xx. Xxxx, who shall secure
a
satisfaction and release from IMM at the time of releasing such funds, neither
the Seller nor the Company is a party to any agreement which offers or grants
to
any person the right to purchase or acquire any of the Shares. There is no
applicable local, state or federal law, rule, regulation, or decree which would,
as a result of the sale contemplated by this Agreement, impair, restrict or
delay any voting rights with respect to the Shares.
2.5 Survival
of Representations.
The
representations and warranties herein by the Seller will be true and correct
in
all material respects on and as of the Closing Date with the same force and
effect as though said representations and warranties had been made on and as
of
the Closing Date and will survive the Closing Date as provided in
Section 7.1(c).
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2.6 Adoption
of Company’s Representations.
The
Seller adopts and remakes as his own each and every representation, warranty
and
undertaking made by the Company in Article 3 below as if they had made such
representations, warranties and undertakings to the Purchaser
directly.
2.7 Brokers.
No
broker, finder or investment banker is entitled to any brokerage, finder’s or
other fee or commission payable by the Purchaser or the Company in connection
with the transactions contemplated by this Agreement.
ARTICLE
3
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COMPANY
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COMPANY
The
Company represents, warrants and undertakes to the Purchaser that, except as
set
forth on the Disclosure Schedule:
3.1 Due
Organization.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Florida (a) with full power and authority to
own,
lease, use, and operate its properties and to carry on its business as and
where
now owned, leased, used, operated and conducted. The Company has no
subsidiaries. The Company is not qualified to conduct business in any
jurisdiction other than the States of Florida and Ohio, and (b) all actions
taken by the current directors and stockholders of the Company have been valid
and in accordance with the laws of the State of Florida and all actions taken
by
the Company have been duly authorized by the current directors and stockholders
of the Company as appropriate.
3.2
(a) Company
Authority.
The
Company has all requisite corporate power and authority to enter into and
perform this Agreement and to consummate the transactions contemplated
herein.
(b) Due
Authorization.
The
execution, delivery and performance by the Company of this Agreement has been
duly and validly authorized and no further consent or authorization of the
Company, its Board of Directors or its stockholders is required. The Seller
is
not disqualified from acting as a director with respect to the transactions
contemplated hereby by reason of his interest in the transactions.
(c) Valid
Execution.
This
Agreement has been duly executed and delivered by the Company.
(d) Binding
Agreement.
This
Agreement constitutes, and upon execution and delivery thereof by the Company,
will constitute, a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as may be limited
by
applicable bankruptcy, insolvency or similar laws affecting creditor’s rights
generally or the availability of equitable remedies.
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(e) No
Violation of Corporate Documents or Agreements.
The
execution and delivery of this Agreement by the Company and the performance
by
the parties hereto of its obligations hereunder will not cause, constitute,
or
conflict with or result in (i) any breach or violation, or give rise to a right
of termination, cancellation or acceleration of any obligation or to loss of
a
material benefit under, or to increased, additional, accelerated or guaranteed
rights or entitlements of any person under any of the provisions of, or
constitute a default under, any license, indenture, mortgage, charter,
instrument, certificate of incorporation, bylaw, judgment, order, decision,
writ, injunction, or decree or other agreement or instrument or proceeding
to
which the Company or its stockholders are a party, or by which they may be
bound, nor will any consents or authorizations of any party other than those
hereto by required, (ii) an event that would cause the Company to be liable
to
any party, or (iii) an event that would result in the creation or imposition
or
any lien, charge or encumbrance on any asset of the Company or on the securities
of the Company to be acquired by the Purchaser.
3.3 Authorized
Capital, No Preemptive Rights, No Liens; Anti-Dilution.
As of
the date hereof, the authorized capital of the Company is 2,000,000,000 shares
of Common Stock, no par value, and 200,000,000 shares of Preferred Stock, no
par
value. The issued and outstanding capital stock of the Company is 15,262,600
shares of Common Stock and no shares of Preferred Stock. All of the shares
of
capital stock are duly authorized, validly issued, fully paid and
non-assessable. No shares of capital stock of the Company are subject to
preemptive rights or similar rights of the stockholders of the Company or any
liens or encumbrances imposed through the actions or failure to act of the
Company, or otherwise. As of the date hereof (i) there are no outstanding
options, warrants, convertible securities, scrip, rights to subscribe for,
puts,
calls, rights of first refusal, tag-along agreements, nor any other agreements,
understandings, claims or other commitments or rights of any character
whatsoever relating to, or securities or rights convertible into or exchangeable
for any shares of capital stock of the Company, or arrangements by which the
Company is or may become bound to issue additional shares of capital stock
of
the Company, and (ii) there are no agreements or arrangements under which the
Company is obligated to register the sale of any of its securities under the
Securities Act of 1933, and (iii) there are no anti-dilution or price
adjustment provisions contained in any security issued by the Company (or in
the
Company’s certificate of incorporation or bylaws or in any agreement providing
rights to security holders) that will be triggered by the transactions
contemplated by this Agreement. The Company has furnished to Purchaser true
and
correct copies of the Company’s certificate of incorporation and
bylaws.
3.4 No
Governmental Action Required.
The
execution and delivery by the Company of this Agreement does not and will not,
and the consummation of the transactions contemplated hereby will not, require
any action by or in respect of, or filing with, any governmental body, agency
or
governmental official, other than disclosure reports required by the laws and
rules of the SEC.
3.5 Compliance
with Applicable Law and Corporate Documents.
The
execution and delivery by the Company of this Agreement and the performance
by
the parties hereto of the transactions contemplated hereby does not and will
not
contravene or constitute a default under or violation of (i) any provision
of
applicable law or regulation, (ii) the Company’s certificate of incorporation or
bylaws, or (iii) any agreement, judgment, injunction, order, decree or other
instrument binding upon the Company or any its assets, or result in the creation
or imposition of any lien on any asset of the Company. To the best of its
knowledge, the Company is in compliance with and conforms to all statutes,
laws,
ordinances, rules, regulations, orders, restrictions and all other legal
requirements of any domestic or foreign government or any instrumentality
thereof having jurisdiction over the conduct of its businesses or the ownership
of its properties.
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3.6 Financial
Statements.
(a) The
Purchaser has received a copy of the audited financial statements of the Company
for the fiscal years ended December 31, 2005 and unaudited financial
statements of the Company for the nine months ended September 30, 2006
(“Financial
Statements”).
The
Financial Statements fairly present the financial condition of the Company
at
the dates indicated and its results of their operations and cash flows for
the
periods then ended and, except as indicated therein, reflect all claims against,
debts and liabilities of the Company, fixed or contingent, and of whatever
nature. (b) Since September 30, 2006 (the “Balance
Sheet Date”),
there
has been no material adverse change in the assets or liabilities, or in the
business or condition, financial or otherwise, or in the results of operations
or prospects, of the Company, whether as a result of any legislative or
regulatory change, revocation of any license or rights to do business, fire,
explosion, accident, casualty, labor trouble, flood, drought, riot, storm,
condemnation, act of God, public force or otherwise and no material adverse
change in the assets or liabilities, or in the business or condition, financial
or otherwise, or in the results of operation or prospects, of the Company except
in the ordinary course of business. (c) Since the Balance Sheet Date, the
Company has not suffered any damage, destruction or loss of physical property
(whether or not covered by insurance) affecting its condition (financial or
otherwise) or operations (present or prospective), nor has the Company issued,
sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose
of,
any capital stock or any other security of the Company and has not granted
or
agreed to grant any option, warrant or other right to subscribe for or to
purchase any capital stock or any other security of the Company or has incurred
or agreed to incur any indebtedness for borrowed money. (d) The Financial
Statements are contained in the Company’s filings and reports made with the
Securities and Exchange Commission (“SEC”) since the Company’s formation (the
“SEC Reports”). The SEC Reports are (i) accurate and complete, (ii) contain all
information required to be filed under the rules and regulations of the SEC,
(iii) are not subject to any outstanding SEC comment letters or inquiries,
and
(iv) do not contain any false statement of fact or fail to state ant fact
necessary to make the facts stated therein not misleading.
3.7 No
Litigation.
The
Company is not a party to any suit, action, arbitration, or legal,
administrative, or other proceeding, or pending or threatened governmental
investigation. The Company is not subject to or in default with respect to
any
order, writ, injunction, or decree of any federal, state, local, or foreign
court, department, agency, or instrumentality.
3.8 No
Taxes.
The
Company is not, and will not become with respect to any periods ending on or
prior to the Closing Date, liable for any material income, sales, withholding,
franchise, excise, license, real or personal property taxes (a “Tax”)
to any
foreign, United States federal, state or local governmental agencies whatsoever.
The S Corporation election of the Company has been terminated for the year
ended
December 31, 2006. All United States federal, state, county, municipality
local or foreign income Tax returns and all other material Tax returns
(including information returns) that are required, or have been required, to
be
filed by or on behalf of the Company have been or will be filed as of the
Closing Date and all Taxes due pursuant to such returns or pursuant to any
assessment received by the Company have been or will be paid as of the Closing
Date. The charges, accruals and reserves on the books of the Company in respect
of taxes or other governmental charges have been established in accordance
with
the tax method of accounting. All returns that have been filed relating to
Tax
are true and accurate in all material respects. No audit, action, suit,
proceeding or other examination regarding taxes for which the Company may have
any liability is currently pending against or with respect to the Company and
neither Seller nor the Company has received any notice (formally or informally)
of any audit, suit, proceeding or other examination. No material adjustment
relating to any Tax returns, no closing or similar agreement have been entered
into or issued or have been proposed (formally or informally) by any tax
authority (insofar as such action relate to activities or income of or could
result in liability of the Company for any Tax) and no basis exists for any
such
actions. The Company has not changed any election, adopted or changed any
accounting method or period, filed any amended return for any Tax, settled
any
claim or assessment of any Tax, or surrendered any right to claim any refund
of
any Tax, or consented to any extension or waiver of the statute of limitations
for any Tax.
6
3.9 Conduct
of the Business.
From
and after September 30, 2006 until the Closing Date:
(a) The
Company has continued to be operated in the usual and ordinary manner in which
its business has been conducted in the past and during such period. The Company
has not made any expenditures or entered into any commitments which, when
compared to past operations of its business, are unusual or extraordinary or
outside the scope of the normal course of routine operations;
(b) The
Company has kept in a normal state of repair and operating efficiency all
tangible personal property used in the operation of its business;
(c) The
Company has used its best efforts to maintain the good will associated with
its
business, and the existing business relationships with its agents, customers,
lessors, key employees, suppliers and other persons having relations with
it;
(d) The
Company has not entered into any contract, agreement or action, or relinquished
or released any rights or privileges under any contracts or agreements, the
performance, violation, relinquishment or release of which could, on the date
on
which such contract or agreement was entered into, or such rights or privileges
were relinquished or released, be reasonably foreseen to have a material adverse
effect;
(e) The
Company has not made, or agreed to make, any acquisition of stock or assets
of,
or made loans to, any person not in the ordinary course of
business;
(f) The
Company has not sold or disposed of any assets or created or permitted to exist
any encumbrance on its assets except (x) in the ordinary course of business
and
which could not, on the date of such sale, disposition, creation or permission,
be reasonably foreseen to have a material adverse effect or (y) as otherwise
permitted by this Agreement;
7
(g) The
Company has kept true, complete and correct books of records and accounts with
respect to its business, in which entries will be made of all transactions
on a
basis consistent with past practices and in accordance with the tax method
of
accounting consistently applied by the Company;
(h) The
Company has paid current liabilities as and when they became due and has paid
or
incurred no fees and expenses not in the ordinary course of its
business;
(i) There
has
been no declaration, setting aside or payment of any dividend or other
distribution in respect of any Shares or any other securities of the Company
(whether in cash or in kind);
(j) The
Company has not redeemed, repurchased, or otherwise acquired any of its
securities or entered into any agreement to do so;
(k) The
Company has not made any loan to, or entered into any other transaction with,
any of its directors, officers, and employees;
(l) The
Company has not made or pledged to make any charitable or other capital
contribution outside the ordinary course of business; and
(m) There
has
not been any other occurrence, event, incident, action, failure to act or
transaction outside the ordinary course of business that would have a material
adverse effect.
3.10 Liabilities.
(a) Except
as
set forth in the Financial Statements and the SEC Reports, the Company has
no
liabilities or obligations.
(b) Except
as
set forth in the Disclosure Schedule, since September 30, 2006, the Company
has not:
(i) subjected
to encumbrance, or agreed to do so to any of its assets, tangible or intangible
other than purchase money liens in the ordinary course of business on equipment
used in the conduct of business and incurred to finance the purchase price
of
the equipment involved and which do not cover any other asset of the
Company;
(ii) except
as
otherwise contemplated hereby, engaged in any transactions affecting its
business or properties not in the ordinary course of business consistent with
past practice or suffered any extraordinary losses or waived any rights of
substantial value except in the ordinary course of business; or
(iii) other
than in the ordinary course of business consistent with past practice, granted
or agreed to grant, or paid or agreed to pay any increase in the rate of wages,
salaries, bonuses or other remuneration of any officer, director,
non-officer/director or employee or become a party to any employment contract
or
arrangement with any of its directors, officers, consultants or employees or
become a party to any contract or arrangement with any director, officer,
consultant or employee providing for bonuses, profit sharing payments, severance
pay or retirement benefits.
8
3.11 ERISA
Compliance.
The
Company maintains no “employee benefit plan” within the meaning of Section 3(3)
of the Employee Retirement Income Security Act of 1974 (“ERISA”),
under
which the Company or any ERISA Affiliate has any current or future obligation
or
liability or under which any employee of the Company or any ERISA Affiliate
has
any current or future right to benefits.
3.12 Insurance.
The
Disclosure Schedule includes a true and correct list of all policies or binders
of insurance of the Company in force, specifying the insurer, policy number
(or
covering note number with respect to binders) and amount thereof and describing
each pending claim thereunder. Such policies are in full force and effect and
have been provided to Purchaser. The Company is not in default with respect
to
any provisions contained in any such policy or binder, nor has it failed to
give
any notice or present any claim under any such policy or binder in due and
timely fashion. There are no outstanding unpaid claims under any such policy
or
binder, or claims for worker’s compensation. The Company has not received notice
of cancellation or non-renewal of any such policy or binder. The Company has
never been, and is not now, the subject of any claim relating to damage or
injury in excess of the Company’s then-current product liability policy limits
or which has been disclaimed by the Company’s insurer.
3.13 Compliance
with Law.
To the
best of its knowledge, the Company has complied with, and is not in violation
of
any provision of laws or regulations of federal, state or local government
authorities and agencies, including any environmental laws and regulations.
There are no pending or threatened proceedings against the Company by any
federal, state or local government, or any department, board, agency or other
body thereof.
3.14 Consents.
The
Disclosure Schedule lists all consents (“Consents”)
of
third parties required to be obtained as a result of the change of control
of
the Company hereby.
3.15 Agreements.
Except
as set forth in the Disclosure Schedule, the Company is not a party to any
material agreement, loan, credit, lease, sublease, franchise, license, contract,
commitment or instrument or subject to any corporate restriction. The Disclosure
Schedule identifies every loan or credit agreement, and every fully or partially
executory agreement or purchase order pursuant to which the Company is obligated
to deliver goods or perform services, pay for goods, services or other property,
or repay any loan, including, without limitation, any agreement with present
or
former officers, directors, consultants, agents, brokers, vendors, customers
and/or dealers of any nature. True, correct and complete copies of all such
agreements have been delivered to Purchaser. Neither the Company nor any other
party is in default under any such agreement, loan, credit, lease, sublease,
franchise, license, contract, commitment, instrument or restriction. No such
instrument requires the consent of any other party thereto in order to
consummate the sales of the Shares hereby.
9
3.16 Environmental
Liability.
As used
herein, “Environmental Laws” means, any federal, state or local (including
without limitation the common law), ordinance, rule, regulation, order, decree,
judgment, injunction, demand letter, request for information, or schedule or
time table set forth in any federal, state or local law (including without
limitation the common law), ordinance, rule, regulation, order, decree,
judgment, injunction, demand letter or request for information issued,
promulgated, approved or entered thereunder relating to pollution or protection
of the environment or to occupational health or safety, including without
limitation laws relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants, chemicals, or industrial, toxic or
Hazardous Substances or wastes into the environment (including, without
limitation, ambient air, surface water, ground water, land, surface or
subsurface strata), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or Hazardous
Substances or wastes. “Hazardous Substance” means any substance or material
regulated by any Environmental Law, or in the regulations adopted and
publications promulgated pursuant thereto and include, without limitation,
any
flammable explosives, radioactive materials, hazardous materials, hazardous
wastes, toxic substances, asbestos or any material containing asbestos. To
the
Company’s knowledge: (i) the Company has obtained all material permits,
licenses and other authorizations which are required with respect to its
operation under Environmental Laws; (ii) the Company is in substantial
compliance with the terms and conditions of the required permits, licenses
and
authorizations required by the Environmental Laws; (iii) there is no civil,
criminal or administrative action, suit, demand, claim, hearing, notice of
violation, proceeding, notice or demand letter pending relating to the Company
or threatened against it relating in any way to any Environmental Laws or any
regulation, code, plan, order, decree, judgment or injunction issued, entered,
promulgated or approved thereunder; (iv) there are no investigations or internal
or non-public agency proceedings pending regarding the Company relating in
any
way to any Environmental Laws or any regulation, code, plan, order, decree,
judgment or injunction issued, entered, promulgated or approved thereunder;
and
(v) during the Company’s ownership of the Assets, there has been no generation,
production, refining, processing, manufacturing, use, storage, disposal,
treatment, shipment, emission, receipt or release of a Hazardous Substance
or
petroleum or petroleum by-product on, in or under the Assets of the Company
which would subject the Company or Purchaser to liability for the removal,
remediation or cleanup of the Hazardous Substance, petroleum or petroleum
by-product under the Environmental Laws or common law. The Company has delivered
to Purchaser true and complete copies of all environmental studies made by
it,
at its direction or otherwise in its possession, relating to the Assets. During
the ownership and/or operation by the Company of its property, and to the
Company’s and Seller’s knowledge, except as disclosed in the Spreadsheet, all
Hazardous Substances have been handled in substantial compliance with
Environmental Laws.
3.17 Properties.
The
Company owns no real properties. A list of its personal property is set forth
in
the Disclosure Schedule.
3.18 SEC
Status.
The
Company is a reporting company pursuant to Section 15(d) of the Securities
Exchange Act of 1934, and, subject to the last sentence of this section, its
shares are qualified for trading on the Over-the-Counter Bulletin Board under
the symbol “TBPI.” The common stock is listed in the Standard & Poors
Corporation Records. The Registration Statement is effective, and the Company
has received no stop order or order limiting its effectiveness. The Company
is
currently a “voluntary filer” until such time as it files a Form 8-A to register
as a reporting company under the Securities Exchange Act of 1934.
10
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
Unless
specifically stated otherwise, Purchaser represents and warrants that the
following are true and correct as of the date hereof and will be true and
correct through the Closing Date as if made on that date:
4.1 Agreement’s
Validity.
This
Agreement has been duly executed and delivered by Purchaser and constitutes
a
legal, valid and binding obligation of Purchaser, enforceable against Purchaser
in accordance with its terms, except as may be limited by applicable bankruptcy,
insolvency or similar laws affecting creditors’ rights generally or the
availability of equitable remedies.
4.2 Investment
Intent.
Purchaser is acquiring the Shares for its own account for investment and not
with a view to, or for sale or other disposition in connection with, any
distribution of all or any part thereof.
4.3 Restricted
Securities.
Purchaser understands that the Shares have not been registered pursuant to
the
Securities Act of 1933 (the “Act”) or any applicable state securities laws, that
the Shares will be characterized as “restricted securities” under federal
securities laws, and that under such laws and applicable regulations the Shares
cannot be sold or otherwise disposed of without registration under the Act
or an
exemption therefrom.
4.4 Legend.
It is
agreed and understood by Purchaser that the Certificates representing the Shares
shall each conspicuously set forth on the face or back thereof a legend in
substantially the following form:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY
MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR PURSUANT
TO AN EXEMPTION FROM REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO
THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
4.5 Disclosure
of Information.
Purchaser acknowledges that it has been furnished with information regarding
the
Company and its business, assets, results of operations, and financial condition
to allow Purchaser to make an informed decision regarding an investment in
the
Shares. Purchaser represents that it has had an opportunity to ask questions
of
and receive answers from the Company regarding the Company and its business,
assets, results of operation, and financial condition.
11
4.6 Economic
Risk.
Purchaser acknowledges that it must bear the economic risk of its investment
in
the Shares for an indefinite period of time since the Shares have not been
registered under the Act and therefore cannot be sold unless the Shares are
subsequently registered or an exemption from registration is available.
4.7 No
Public Solicitation.
The
sale of the Shares to Purchaser is being made without any public solicitation
or
advertisements.
4.8 Criminal
Proceedings.
Neither
the Purchaser nor its respective officers, directors, affiliates, promoters
nor
any predecessor of the Purchaser have been subject to or suffered any of the
following:
|
·
|
Any
conviction in a criminal proceeding or being subject to a pending
criminal
proceeding (excluding traffic violations and other misdemeanor offenses)
within ten (10) years from the date
hereof;
|
|
·
|
Any
order, judgment or decree, not subsequently reversed, suspended or
vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limited such
person’s involvement in any type of business, securities or banking
activities within ten (10) years of the date hereof;
or
|
|
·
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Being
found guilty by a court of competent jurisdiction (in a civil action),
the
SEC or the CFTC to have violated a federal or state securities or
commodities law within ten (10) years of the date hereof, and the
judgment
has not been revered, suspended or
vacated.
|
4.9 Accredited
Investor.
Purchaser is a “accredited investor” within the meaning of Rule 501 of
Regulation D promulgated under the Act.
4.10 Financial
Matters Experience.
Purchaser has such knowledge and experience in financial matters as to be
capable of evaluating the merits and risks of an investment in the
Shares.
ARTICLE
5
COVENANTS
OF THE PARTIES
5.1 General.
In case
at any time after the Closing any further action is necessary or desirable
to
carry out the purposes of this Agreement, each of the Parties will take such
further action (including the execution and delivery of such further instruments
and documents) as any other Party may request, all at the sole cost and expense
of the requesting Party (unless the requesting Party is entitled to
indemnification therefor under Article 7 below). The Purchaser has had the
opportunity to review and inspect all documents, books, records (including
Tax
records), properties, agreements, field operations, environmental records and
compliance, and financial data of any sort relating to the Company, and to
discuss the Company with its employees, customers and vendors.
12
5.2 Notices
and Consents.
The
Seller will, and will cause the Company to, give any notices to third parties,
and the Seller will use its best efforts, and will cause the Company to use
its
best efforts, to obtain any third-party Consents that the Purchaser may request.
Each of the Parties will (and the Seller will cause the Company to) give any
notices to, make any filings with, and use its best efforts to obtain any
required authorizations, Consents, and approvals of governmental bodies, except
that Purchaser shall be responsible and shall pay for all post-Closing SEC
filings necessary in connection with or as a result of this Agreement and any
transactions contemplated in this Agreement.
5.3 Transition.
Seller
will not take any action that is designed or intended to have the effect of
discouraging any lessor, licensor, customer, supplier, or other business
associate of the Company from maintaining the same business relationships with
the Company after the Closing as it maintained with the Company prior to the
Closing. The Seller will refer all customer inquiries relating to the business
of the Company to the Purchaser from and after the Closing.
ARTICLE
6 - THE CLOSING
6.1 Time
of Closing.
The
Closing of the transactions hereby shall occur as expeditiously as possible
after the satisfaction of all conditions to Closing, but in any event on or
before February 1, 2007.
6.2 Deliveries. The
Closing shall occur as a single integrated transaction, as follows.
(a) Delivery
by Seller.
Seller
shall deliver to Purchaser:
|
(i)
|
The
Shares;
|
|
(ii)
|
copies
of resolutions by the Board of Directors of the Company approving
the
terms of this Agreement and the execution of the Agreement by the
Company;
|
|
(iii)
|
copies
of all books, records and documents relating to the Company, including
the
corporate records and stock records of the
Company;
|
|
(iv)
|
any
other such instruments, documents and certificates as are required
to be
delivered by Seller or its representatives pursuant to the provisions
of
this Agreement;
|
|
(v)
|
any
third-party Consents;
|
|
(vi)
|
the
Disclosure Schedule; and
|
|
(vii)
|
evidence
of the satisfaction of all conditions set forth in
Section 1.5.
|
13
(b) Delivery
by Purchaser.
Purchaser shall deliver to Seller:
|
(i)
|
The
Purchase Price in U.S. currency by wire transfer to a bank account
designated in writing by the Seller;
and
|
|
(ii)
|
copies
of resolutions of the Board of Directors of Purchaser approving the
terms
of the Agreement and the execution of this Agreement by the
Purchaser.
|
(c) Post-Closing
Actions
|
(i)
|
Immediately
upon the Closing Date, the Board of Directors of the Company shall
resolve
to appoint Xxxxxxx Xxxxxx as director of the Company with immediate
effect.
|
|
(ii)
|
Following
the appointment of such persons to the Board of Directors of the
Company,
the Seller and all others shall resign from the Board of Directors
and as
officers.
|
|
(iii)
|
The
Company at Purchaser’s expense and in connection with which Seller shall
have no responsibility, financial or otherwise, shall make all required
filings with the Securities and Exchange Commission to disclose the
transactions hereby.
|
|
(iv)
|
The
Company shall review the advisability of a forward stock split and
a
conversion of the Company into a Nevada corporation, with any such
action
at Purchaser’s expense.
|
ARTICLE
7
INDEMNIFICATION
7.1 Purchaser
Claims.
(a) Seller
shall indemnify and hold harmless Purchaser, its successors and assigns,
against, and in respect of:
(i) Any
and
all damages, losses, liabilities, costs, and expenses incurred or suffered
by
Purchaser that result from, relate to, or arise out of:
(A) Any
failure by Seller to carry out any covenant or agreement contained in this
Agreement;
(B) Any
material misrepresentation or breach of warranty by Seller contained in this
Agreement, the Disclosure Schedule, or any certificate, furnished to Purchaser
by Seller pursuant hereto; or
(C) Any
claim
by any Person for any brokerage or finder’s fee or commission in respect of the
transactions contemplated hereby as a result of Seller’ dealings, agreement, or
arrangement with such Person.
14
(ii) Any
and
all actions, suits, claims, proceedings, investigations, demands, assessments,
audits, fines, judgments, costs, and other expenses (including, without
limitation, reasonable legal fees and expenses) incident to any of the foregoing
including all such expenses reasonably incurred in mitigating any damages
resulting to Purchaser from any matter set forth in subsection (i)
above.
(b) The
amount of any liability of Seller under this Section 7.1 shall be computed
net of any tax benefit to Purchaser from the matter giving rise to the claim
for
indemnification hereunder and net of any insurance proceeds received by
Purchaser with respect to the matter out of which such liability
arose.
(c) The
representations and warranties of Seller contained in this Agreement, the
Disclosure Schedule, or any certificate delivered by or on behalf of Seller
pursuant to this Agreement or in connection with the transactions contemplated
herein shall survive the consummation of the transactions contemplated herein
and shall continue in full force and effect for a period until the expiration
of
any applicable statutes of limitation provided by law (“Survival
Period”).
Anything to the contrary notwithstanding, the Survival period shall be extended
automatically to include any time period necessary to resolve a written claim
for indemnification which was made in reasonable detail before expiration of
the
Survival Period but not resolved prior to its expiration, and any such extension
shall apply only as to the claims so asserted and not so resolved within the
Survival Period. Liability for any such item shall continue until such claim
shall have been finally settled, decided, or adjudicated.
(d) Purchaser
shall provide written notice to Seller of any claim for indemnification under
this Article as soon as practicable; provided, however, that failure to provide
such notice on a timely basis shall not bar Purchaser’s ability to assert any
such claim except to the extent that Seller are actually prejudiced thereby,
provided that such notice is received by Seller during the applicable Survival
Period. Purchaser shall make commercially reasonable efforts to mitigate any
damages, expenses, etc. resulting from any matter giving rise to liability
of
Seller under this Article.
7.2 Defense
of Third-Party Claims.
With
respect to any claim by Purchaser under Section 7.1, relating to a third
party claim or demand, Purchaser shall provide Seller with prompt written notice
thereof and Seller may defend, in good faith and at its expense, by legal
counsel chosen by it and reasonably acceptable to Purchaser any such claim
or
demand, and Purchaser, at its expense, shall have the right to participate
in
the defense of any such third party claim. So long as Seller are defending
in
good faith any such third party claim, Purchaser shall not settle or compromise
such third party claim. In any event Purchaser shall cooperate in the settlement
or compromise of, or defense against, any such asserted claim.
7.3 Seller
Claims.
(a) Purchaser
shall indemnify and hold harmless Seller, its successors and assigns, against,
and in respect of:
|
(i)
|
Any
and all damages, losses, liabilities, costs, and expenses incurred
or
suffered by Seller that result from, relate to, or arise out
of:
|
15
(A) Any
failure by Purchaser to carry out any covenant or agreement contained in this
Agreement;
(B) Any
material misrepresentation or breach of warrant by Purchaser contained in this
Agreement, the Disclosure Schedule, or any certificate, furnished to Seller
by
Purchaser pursuant hereto; or
(C) Any
claim
by any Person for any brokerage or finder’s fee or commission respect of the
transactions contemplated hereby as a result of Purchaser’s dealings, agreement,
or arrangement with such Person.
|
(ii)
|
Any
and all actions, suits, claims, proceedings, investigations, demands,
assessments, audits, fines, judgments, costs, and other expenses
(including, without limitation, reasonable legal fees and expenses)
incident to any of the foregoing including all such expenses reasonably
incurred in mitigating any damages resulting to Seller from any matter
set
forth in subsection (i) above.
|
(b) The
amount of any liability of Purchaser under this Section 7.3 shall be
computed net of any tax benefit to Seller from the matter giving rise to the
claim for indemnification hereunder and net of any insurance proceeds received
by Seller with respect to the matter out of which such liability
arose.
(c) The
representations and warranties of Purchaser contained in this Agreement or
any
certificate delivered by or on behalf of Purchaser pursuant to this Agreement
or
in connection with the transactions contemplated herein shall survive the
consummation of the transactions contemplated herein and shall continue in
full
force and effect for a period until the expiration of any application statutes
of limitation provided by law (“Survival
Period”).
Anything to the contrary notwithstanding, the Survival Period shall be extended
automatically to include any time period necessary to resolve a written claim
for indemnification which was made in reasonable detail before expiration of
the
Survival Period but not resolved prior to its expiration, and any such extension
shall apply only as to the claims so asserted and not so resolved within the
Survival Period. Liability for any such item shall continue until such claim
shall have been finally settled, decided, or adjudicated.
(d) Seller
shall provide written notice to Purchaser of any claim for indemnification
under
this Article as soon as practicable; provided, however, that failure to provide
such notice on a timely basis shall not bar Seller’s ability to assert any such
claim except to the extent that Purchaser is actually prejudiced thereby,
provided that such notice is received by Purchaser during the applicable
Survival Period. Seller shall make commercially reasonable efforts to mitigate
any damages, expenses, etc. resulting from any matter giving rise to liability
of Purchaser under this Article.
7.4 Defense
of Third-Party Claims.
With
respect to any claim by Seller under Section 7.3, relating to a third-party
claim or demand, Seller shall provide Purchaser with prompt written notice
thereof and Purchaser may defend, in good faith and at its expense, by legal
counsel chosen by it and reasonably acceptable to Seller any such claim or
demand, and Seller, at its expense, shall have the right to participate in
the
defense of any such third-party claim. So long as Purchaser is defending in
good
faith any such third-party claim, Seller shall not settle or compromise such
third-party claim. In any event, Seller shall cooperate in the settlement or
compromise of, or defense against, any such asserted claim.
16
ARTICLE
8
MISCELLANEOUS
8.1 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 understanding 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 statement, 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 set forth.
8.2 Notices.
Any
notice or communications hereunder must be in writing and given by depositing
same in the United States mail addressed to the party to be notified, postage
prepaid and registered or certified mail with return receipt requested or by
delivering same in person. Such notices shall be deemed to have been received
on
the date on which it is hand delivered or on the third business day following
the date on which it is to be mailed. For purpose of giving notice, the
addresses of the parties shall be:
If
to
Seller:
Xxxx
Xxxxxx
0000
Xxxxxxxxx Xxxxx Xxxx
Xxxxxxxx,
Xxxx 00000
If
to
Purchaser or Company to:
Avenel
Financial Group, Inc.
00000
Xxxxxxxxxx Xxxxx
Xxxxxxxxx,
XX 00000
8.3 Governing
Law.
This
Agreement shall be governed in all respects, including validity, construction,
interpretation and effect, by the laws of the State of Texas (without regard
to
principles of conflicts of law).
8.4 Consent
to Jurisdiction.
Each
party irrevocably submits to the exclusive jurisdiction of the appropriate
state
or federal court in the State of Texas for the purposes of any suit, action
or
other proceeding arising out of this Agreement or any transaction contemplated
hereby or thereby. Each party agrees to commence any such action, suit or
proceeding in Dallas, Texas. The parties agree that any service of process
to be
made hereunder may be made by certified mail, return receipt requested,
addressed to the party at the address appearing in Section 9.2. Such
service shall be deemed to be completed when mailed and sent and received by
Telecopier. Seller and Purchaser each waives any objection based on forum
non-conveniens.
Nothing
in this paragraph shall affect the right of Seller or Purchaser to serve legal
process in any other manner permitted by law.
17
8.5 Counterparts.
This
Agreement may be executed by the parties hereto in separate counterparts each
of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
8.6 Waivers
and Amendments; Non-Contractual Remedies; Preservation of
Remedies.
This
Agreement may be amended, superseded, canceled, renewed, or extended, and the
terms hereof may be waived, only by a written instrument signed by authorized
representatives of the parties or, in the case of a waiver, by an authorized
representative of the party waiving compliance. No such written instrument
shall
be effective unless it expressly recites that it is intended to amend,
supersede, cancel, renew or extend this Agreement or to waive compliance with
one or more of the terms hereof, as the case may be. No delay on the part of
any
party in exercising any right, power or privilege hereunder shall operate as
a
waiver thereof, nor shall any waiver on the part of any party of any such right,
power or privilege, or any single or partial exercise of any such right, power
of privilege, preclude any further exercise thereof or the exercise of any
other
right, power or privilege. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any party may
otherwise have at law or in equity. The rights and remedies of any party based
upon, arising out of or otherwise in respect of any inaccuracy in or breach
of
any representation, warranty, covenant or agreement contained in this Agreement
shall in no way be limited by the fact that the act, omission, occurrence or
other state of facts upon which any claim of any such inaccuracy or breach
is
based may also be the subject of any other representation, warranty, covenant
or
agreement contained in this Agreement (or in any other agreement between the
parties) as to which there is no inaccuracy or breach.
8.7 Binding
Effect; No Assignment, No Third-Party Rights.
This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and permitted assigns. This Agreement is not
assignable without the prior written consent of each of the parties hereto
or by
operation of law. This Agreement is for the sole benefit of the parties hereto
and their permitted assigns, and nothing herein, expressed or implied, shall
give or be construed to give to any person, including any union or any employee
or former employee of Seller, any legal or equitable rights, benefits or
remedies of any nature whatsoever, including any rights of employment for any
specified period, under or by reason of this Agreement.
8.8 Further
Assurances.
Each
party shall, at the request of the other party, at any time and from time to
time following the Closing Date promptly execute and deliver, or cause to be
executed and delivered, to such requesting party all such further instruments
and take all such further action as may be reasonably necessary or appropriate
to carry out the provisions and intents of this Agreement and of the instruments
delivered pursuant to this Agreement.
8.9 Severability
of Provisions.
If any
provision or any portion of any provision of this Agreement or the application
of any such provision or any portion thereof to any person or circumstance,
shall be held invalid or unenforceable, the remaining portion of such provision
and the remaining provisions of the Agreement, or the application of such
provision or portion of such provision is held invalid or unenforceable to
person or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby and such provision or portion
of
any provision as shall have been held invalid or unenforceable shall be deemed
limited or modified to the extent necessary to make it valid and enforceable,
in
no event shall this Agreement be rendered void or unenforceable.
18
8.10 Exhibits
and Schedules.
All
exhibits annexed hereto, and all schedules referred to herein, are hereby
incorporated in and made a part of this Agreement as if set forth herein. Any
matter disclosed on any schedule referred to herein shall be deemed also to
have
been disclosed on any other applicable schedule referred to herein.
8.11 Captions.
All
section titles or captions contained in this Agreement or in any schedule or
exhibit annexed hereto or referred to herein, and the table of contents to
this
Agreement, are for convenience only, shall not be deemed a part of this
Agreement and shall not affect the meaning or interpretation of this Agreement.
All references herein to sections shall be deemed references to such parts
of
this Agreement, unless the context shall otherwise require.
8.12 Expenses.
Except
as otherwise expressly provided in this Agreement, whether or not the Closing
Date occurs, each party hereto shall pay its own expenses incidental to the
preparation of this Agreement, the carrying out of the provisions hereof and
the
consummation of the transactions contemplated.
8.13 Public
Announcements.
The
parties agree to consult with each other before issuing any press release or
making any public statement or completing any public filing with respect to
this
Agreement or the transactions contemplated hereby and, except as may be required
by applicable law or any listing agreement with any national securities exchange
or quotation system, will not issue any such press release or make any such
public statement prior to consultation.
8.14 Non-confidentiality.
Notwithstanding Section 8.13, the Company, Seller and Purchaser, and each
employee, representative or other agent of the same (collectively the
“Covered
Parties”),
may
disclose to any and all persons, without limitation of any kind, the tax
treatment and tax structure of the transaction and all materials of any kind
(including opinions or other tax analyses) that are provided to a Covered Party
relating to such tax treatment and tax structure.
8.15 Release.
Except
for matters subject to indemnification as provided in Section 7.3, Seller,
for herself and her other family members, heirs, successors, and assigns
(collectively the “Releasing Parties”) hereby release, acquit, and forever
discharge any and all claims and demands of whatever kind or character, whether
vicarious, derivative, or direct, whether contingent or liquidated, or whether
known or unknown, that she or they, individually, collectively, or otherwise,
have or may have or assert or may assert against the Company; the
Purchaser, any subsidiary, affiliated, or related company, or other related
entity; or any officer, director, fiduciary, agent, employee, representative,
insurer, attorney, accountant, financial advisor, consultant, partner, or
shareholder of the Company or Purchaser; or any successors and assigns of the
Company, the Purchaser or the other entities, companies, partnerships, persons
or parties just named (collectively the “Released Parties”) based upon any
theory of federal, state or local statutory or common law, the breach of any
provision of any contract (express or implied), or with respect to any facts
or
circumstances that exist with respect to the relationship among the Company
or
the Releasing Parties, whether known or unknown, through the date of execution
of this Agreement.
***Signature
Page Follows***
19
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the
date
first written herein above.
| XXXX XXXXXX | ||
| TRIPLE BAY INDUSTRIES, INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
|
AVENEL
FINANCIAL GROUP, INC.
|
||
| By: | ||
|
Xxxxxxx
Xxxxxx, President
|
||
20
