ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("AGREEMENT") is effectively dated and
made as of March 15, 2005 by and between GREEN TREE SPRAY TECHNOLOGIES, LLC, a
Delaware Limited Liability Company ("Green Tree" or "SELLER"), and NANO CHEMICAL
SYSTEMS HOLDINGS, INC., a Nevada Corporation ("NCS" or "BUYER").
RECITALS
The SELLER desires to sell to the BUYER, and the BUYER desires to
purchase from the SELLER the below-defined PROPERTY, upon the terms and
conditions set forth herein.
NOW THEREFORE, in consideration of these premises, the terms and
conditions set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties to this
AGREEMENT, intending to be legally bound hereby, agree as follows:
ARTICLE 1
DEFINITIONS
As used in this AGREEMENT, the following definitions shall have the
meanings set forth as definitions. All terms defined in this AGREEMENT shall be
in all capital letters throughout this AGREEMENT. The singular of any defined
term shall include the plural and the plural shall include the singular.
Section 1.1. Accounts, Chattel Paper, Deposit Accounts, Documents,
Equipment, General Intangibles, Goods, Instruments, Investment Property, Payment
Intangibles, Promissory Notes, and Software. The terms "ACCOUNTS," "CHATTEL
PAPER," "DEPOSIT ACCOUNTS," "DOCUMENTS," "EQUIPMENT," "GENERAL INTANGIBLES,"
"GOODS," "INSTRUMENTS," "PAYMENT INTANGIBLES," and "SOFTWARE" shall have the
same respective meanings as are given to those terms in the Uniform Commercial
Code as currently enacted and in effect in the State of Delaware.
Section 1.2. Terco Division. The term "TERCO DIVISION" means the
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SELLER's business operations related to the manufacture, packaging, filling,
labeling and/or sale of aerosol containers on the TERCO line and aerosol related
products primarily from the SEAFORD PLANT. It also means and is specifically
limited to the business related to the specific customers listed in Exhibit A.
Section 1.3. Assumed Liabilities. The term "ASSUMED LIABILITIES" means,
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collectively any obligations that the SELLER and the BUYER mutually agree, at
the CLOSING, shall be assumed by the BUYER in connection with the SALE. There
shall be no assumed liabilities; however the BUYER shall immediately enter into
a lease obligation to lease 75% of the SEAFORD PLANT.
Section 1.4. Closing. The term "CLOSING" means the date upon which the
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SALE is consummated pursuant to the terms of Section 2.2 of this AGREEMENT.
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Section 1.5. Contract Rights. The term "CONTRACT RIGHTS" has the
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meaning given to that term in the 1962 Official Text with Comments promulgated
by the National Conference Of Commissioners On Uniform State Laws And The
American Law Institute.
Section 1.6. Excluded Items. The term "EXCLUDED ITEMS" means,
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collectively, those items of real, personal or intangible property of the SELLER
which are not used in the business of the TERCO DIVISION. Any item not
specifically listed on the asset schedule described on Exhibit "B" attached
hereto is specifically excluded.
Section 1.7. Inventory. The term "INVENTORY" means, collectively, all
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of the SELLER's inventory, GOODS, merchandise, materials, raw materials, goods
in process, finished goods, work in progress, bindings or component materials,
packaging and shipping materials, and other tangible or intangible personal
property, now owned or acquired prior to CLOSING, and held for sale or lease or
furnished or to be furnished under contracts of service or which contribute to
the finished products or the sale, promotion, storage and shipment thereof, BUT
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ONLY TO THE EXTENT THAT the foregoing are: (a) used primarily or exclusively
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with the TERCO DIVISION. A complete list of the included inventory is described
in the asset schedule in Exhibit B.
Section 1.8. Landlord. The term "LANDLORD" means, individually or
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collectively as the context may require, the owner of each parcel of real
property upon which the SEAFORD PLANT is located.
Section 1.9. Other Property. The term "OTHER PROPERTY" means,
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collectively, all of the following that are owned by the SELLER BUT ONLY TO THE
EXTENT THAT the following are used primarily or exclusively in the business of
the TERCO DIVISION, and exclusive of the EXCLUDED ITEMS: (a) proprietary
chemical formulations, know how and other intellectual property which are
related to the TERCO products which are attached as Exhibit C to the contract
and (e) any and all other property or rights which are necessary to the present
operation of, the TERCO DIVISION as now or hereafter conducted by the SELLER.
Section 1.10. Property. The term "PROPERTY" means, collectively, the
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INVENTORY, and the OTHER PROPERTY which is related to the TERCO DIVISION. All of
the property is listed in Exhibit B.
Section 1.11. Purchase Price. The term "PURCHASE PRICE" means the
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aggregate price to be paid by the BUYER to the SELLER for the PROPERTY.
Section 1.12. Receivables. The term "RECEIVABLES" means, collectively,
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all of the SELLER's ACCOUNTS, CONTRACT RIGHTS, CLAIMS, REFUNDS, DEPOSITS,
INSTRUMENTS, DOCUMENTS, GENERAL INTANGIBLES, CHATTEL PAPER, notes, notes
receivable, drafts, acceptances, and choses in action, now existing or hereafter
created or acquired, and all proceeds and products thereof, and all rights
thereto, arising from the sale or lease of or the providing of INVENTORY or
services by the SELLER, as well as all other rights, contingent or
non-contingent, of any kind of the SELLER to receive payment, benefit, or credit
from any person or entity, including but not limited to the right to receive tax
refunds or tax rebates. No RECIEVABLES are being transferred by this agreement.
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Section 1.13. Sale. The term "SALE" means the sale by the SELLER to the
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BUYER of the PROPERTY pursuant to the terms of this AGREEMENT and the other
documents referenced herein.
Section 1.14. Seaford Plant. The term "SEAFORD PLANT" means,
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collectively, the industrial plant, warehouse and office building that is
currently leased by the SELLER and located in the Seaford Industrial Park in
Seaford, Delaware utilized by the SELLER in connection with the TERCO DIVISION.
ARTICLE 2
TERMS OF THE SALE
Section 2.1. Agreement To Buy And Sell. The SELLER hereby agrees to
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sell to the BUYER, and the BUYER hereby agrees to purchase from the SELLER, the
PROPERTY upon the terms and conditions set forth herein.
Section 2.2. Closing. At the CLOSING, subject to the terms and
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conditions set forth in this AGREEMENT:
(a) the SELLER shall sell, transfer, assign and deliver to the
BUYER, and the BUYER shall purchase, acquire and accept from the SELLER, all of
the SELLER's right, title and interest in and to (i) the PROPERTY, and (ii) all
service agreements, warranties and all similar and other documents in connection
therewith and (iii) all licenses associated with the PROPERTY, pursuant to the
terms of this AGREEMENT and, if the BUYER's counsel deems necessary or
appropriate, the xxxx(s) of sale and/or assignment agreement(s) which the SELLER
shall execute and deliver to the BUYER in connection with the sale, transfer and
assignment of the PROPERTY;
(b) the BUYER shall deliver to the SELLER the PURCHASE PRICE;
Purchase Price. At the CLOSING, the PURCHASE PRICE to be paid by the
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BUYER to the SELLER for the PROPERTY shall be the issuance of
24,000,000 shares of common stock in NCS and a promissory note for One
Million Dollars ($1,000,000).
(c) The BUYER has made no commitment, and is under no
obligation whatsoever: (i) to hire or provide any benefits whatsoever to any of
the SELLER's employees of the TERCO DIVISION or who otherwise work at the
SEAFORD PLANT; or (ii) to satisfy any other payable, liability or obligation of
any kind that may be associated with the TERCO DIVISION, the SEAFORD PLANT, or
any of the PROPERTY that was acquired prior to the CLOSING, regardless of
whether the SELLER or the BUYER is aware of such payable, liability or
obligation prior to the CLOSING.
(d) Furthermore, the BUYER hereby agrees to purchase the
remaining assets and good will of the SELLER not transferred at the CLOSING,
related to the aerosol business of the SELLER, as of June 30, 2005, BUYER's
fiscal year end, for an additional 8,000,000 newly issued common shares and an
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additional promissory note of three hundred and thirty three thousand dollars
($333,000).
(e) After the CLOSING the BUYER shall permit the SELLER, for a
period of up to the second closing, to utilize the INTERNET NAME AND WEBSITE for
the sole purpose of receiving and transmitting e-mail to and from the personal
computers utilized by the SELLER's remaining employees.
(f) A form of the promissory notes will be attached as Exhibit
H.
Section 2.3. Transactions In Ordinary Course Of Business.
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Notwithstanding any of the terms of this AGREEMENT to the contrary, prior to the
CLOSING, the SELLER may continue to sell INVENTORY in the ordinary course of its
business and acquire new INVENTORY and RECEIVABLES as the SELLER deems necessary
or appropriate in connection with the operation of the TERCO DIVISION.
Section 2.4. Time And Place Of Closing. CLOSING shall be held at the
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SEAFORD PLANT, or at another location selected by the SELLER and agreed to by
the BUYER, by no later than the earlier to occur of March 15, 2005 or the date
upon which the contingencies described in the immediately preceding Section have
been satisfied. While the BUYER shall, in good faith, attempt to satisfy such
contingencies in a timely manner as the BUYER is aware of the SELLER's desire to
conduct the CLOSING as soon as possible, if the SELLER and the BUYER are unable
to mutually agree upon a later CLOSING date and the CLOSING does not occur by
the close of business on March 15, 2005, the terms of this AGREEMENT shall no
longer be of any force or effect.
Section 2.5. Transfer Taxes; Title; Recording Costs; Etc. All transfer
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and recordation taxes, stamps and assessments (if any) that are required to be
paid in connection with the transfer and sale of the INVENTORY, the RECEIVABLES,
and the OTHER PROPERTY to the BUYER shall be paid in equal shares at the CLOSING
by the SELLER and the BUYER. Since each party is responsible for their own
attorneys' fees in connection with the transactions contemplated by this
AGREEMENT, all costs associated with the preparation of this AGREEMENT and all
other documents associated with the SALE shall be paid by the SELLER or the
BUYER, as the case may be, to their respective attorneys that may have prepared
or negotiated such documents.
Section 2.6 BUYER shall not assume, and SELLER shall retain and be
responsible for, any liability under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA") or other
environmental liability of any nature with respect to the remediation of any
real property or groundwater which relates to the generation, collection,
transportation or disposal of any materials ("Environmental Liability") by
SELLER or any business predecessor of SELLER to any site or facility whatsoever,
whether or not such site or facility was owned, leased, or operated by either of
them at any time, whether such liability is asserted prior to or after the
Closing.
Section 2.7 Buyer's Remedy Of Specific Performance. If the BUYER is
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ready, willing and able to proceed with the CLOSING pursuant to the terms of
this Article 2 and the other terms of this AGREEMENT that pertain to the SALE,
the SELLER shall be obligated to proceed with the CLOSING pursuant to the terms
of this Article 2 and specifically perform all of the SELLER's other obligations
under this AGREEMENT.
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ARTICLE 3
CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
The obligations of Green Tree under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
Section 3.1 Accuracy of Representations. The representations and
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warranties made by NCS in this Agreement were true when made and shall be true
at the Closing Date with the same force and effect as if such representations
and warranties were made at the Closing Date (except for changes therein
permitted by this Agreement), and NCS shall have performed or compiled with all
covenants and conditions required by this Agreement to be performed or complied
with by NCS prior to or at the Closing.
Section 3.2 Director Approval. The members of the Board of Directors of
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NCS shall have approved this Agreement and the transactions contemplated herein.
Section 3.3 Sub-Lease Agreement. The BUYER shall have entered into a
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new sub-Lease Agreement, upon terms that are acceptable to the BUYER, but which
require payment an assumption of the obligations of 75% of the master lease,
with the SELLER in connection with the BUYER's post-CLOSING operation of the
TERCO DIVISION.
Section 3.4 No Material Adverse Change. Prior to the Closing Date,
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there shall not have occurred any material adverse change in the financial
condition, business or operations of nor shall any event have occurred which,
with the lapse of time or the giving of notice, may cause or create any material
adverse change in the financial condition, business or operations of NCS.
ARTICLE 4
CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER
The obligations of NCS under this Agreement are subject to the
satisfaction, at or before the Closing date (unless otherwise indicated herein),
of the following conditions:
Section 4.1 Accuracy of Representations. The representations and
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warranties made by Green Tree in this Agreement were true when made and shall be
true as of the Closing Date (except for changes therein permitted by this
Agreement) with the same force and effect as if such representations and
warranties were made at and as of the Closing Date, and Green Tree shall have
performed and complied with all covenants and conditions required by this
Agreement to be performed or complied with by Green Tree prior to or at the
Closing. NCS shall have been furnished with a certificate, signed by a duly
authorized executive officer of Green Tree and dated the Closing Date, to the
foregoing effect.
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Section 4.2 Member Approval. The Members of Green Tree shall have
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approved this Agreement and the transactions contemplated herein.
Section 4.3 Member's Certificate. BUYER shall be furnished with a
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certificate dated the Closing date and signed by a duly authorized member of
SELLER to the effect that: (a) the representations and warranties of Green Tree
set forth in the Agreement and in all Exhibits, Schedules and other documents
furnished in connection herewith are in all material respects true and correct
as if made on the Effective Date; and (b) SELLER had performed all covenants,
satisfied all conditions, and complied with all other terms and provisions of
the Agreement to be performed, satisfied or complied with by it as of the
Effective Date. (c) Since such date and other than as previously disclosed to
BUYER, SELLER has not entered into any material transaction other than
transactions which are usual and in the ordinary course if its business; and (d)
no litigation, proceeding, investigation or inquiry is pending or, to the best
knowledge of SELLER, threatened, which might result in an action to enjoin or
prevent the consummation of the transactions contemplated by this Agreement or,
to the extent not disclosed in the Schedules, by or against SELLER which might
result in any material adverse change in any of the assets, properties, business
or operations of SELLER.
Section 4.4 Free from Liens. The INVENTORY, and all of the OTHER
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PROPERTY must all be free and clear of any and all liens, encumbrances and
security interests, and the SELLER shall pay for all lien releases that must be
filed either prior to or immediately following the CLOSING in connection with
all of the existing liens, encumbrances or security interests that have been
filed of record or otherwise attach to or encumber any of the PROPERTY.
Section 4.5 No Material Adverse Change. Prior to the Closing Date,
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there shall not have occurred any material adverse change in the financial
condition, business, operations, or PROPERTY of the SELLER, nor shall any event
have occurred which, with the lapse of time or the giving of notice, may cause
or create any material adverse change in the financial condition, business,
operations or PROPERTY of SELLER.
Section 4.6 Audited Financial Statements. On the Closing Date, SELLER
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shall provide BUYER with updated audited financial statements prepared in
accordance with US GAAP.
Section 4.7 Other Items. BUYER shall have received such further
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documents, certificates or instruments relating to the transactions contemplated
hereby as BUYER may reasonably request.
ARTICLE 5
COVENANTS AND INDEMNIFICATIONS
Section 5.1 Copies Of Records And Other Materials. Promptly after
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execution of this AGREEMENT by both parties hereto, the SELLER shall deliver to
the BUYER, at no cost to the BUYER, copies of the following:
(a) the bills of sale, receipts or such other documents of
conveyance, to the extent such documents reasonably can be made available and
are necessary to effectuate the SALE, by which the SELLER obtained legal title
to the PROPERTY, as the case may be;
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(b) all service agreements, warranties and all similar and
other documents for the PROPERTY, if applicable and to the extent such documents
reasonably can be made available; and
(c) all MSDS sheets and other environmental records associated
with the PROPERTY.
Section 5.2 Notices. The SELLER shall promptly give the BUYER copies of
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any written notices which the SELLER receives after the effective date hereof
that materially adversely effects the PROPERTY.
ARTICLE 6
SELLER'S REPRESENTATIONS AND WARRANTIES
Section 6.1. Organization. SELLER is a limited liability company duly
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organized, validly existing, and in good standing under the laws of Delaware and
has the power and is duly authorized, qualified, franchised and licensed under
all applicable laws, regulations, ordinances and orders of public authorities to
own all of its properties and assets and to carry on its business in all
material respects as it is now being conducted, including qualification to do
business in the jurisdiction in which the character and location of the assets
owned by it or the nature of the business transacted by it requires
qualification. SELLER has full power, authority and legal right and has taken
all action required by law, its articles of formation, its bylaws or otherwise
to authorize the execution and delivery of this Agreement.
Section 6.2. Accuracy Of Information. To the best of the SELLER'S
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knowledge, all information of the SELLER contained in or attached to this
AGREEMENT, is substantially true and accurate, and contains no materially false,
incomplete, or misleading statements.
Section 6.3. No Litigation. There is no action, suit, or proceeding
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pending or threatened against the SELLER that could reasonably be expected to
have a material adverse impact upon the SELLER'S ability to sell, transfer,
assign and deliver the PROPERTY to the BUYER free and clear of any and all liens
against the PROPERTY.
Section 6.4. Tax Matters: Books and Records. The SELLER will allow the
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BUYER to audit the assets being transferred pursuant to this agreement by
Xxxxxxx Xxxxxxx an auditor, engaged by the BUYER, who practices with respect to
SEC matters. The result of the asset audit and the assigned values will be
attached to this agreement as Exhibit G and will form the basis for booking the
assets into the BUYER.
Section 6.5. Title To Property; No Liens; "As Is" Sale. The SELLER: (a)
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represents that -- (i) it has good and marketable title to all of the PROPERTY,
and (ii) there are no unrecorded liens, security interests, easements, leases,
claims, restrictions, covenants or encumbrances affecting all or any portion of
the PROPERTY; and (b) covenants that title to the PROPERTY shall be transferred
to the BUYER at the CLOSING free and clear of any and all liens, encumbrances
and security interests. The PURCHASER acknowledges and agrees that, with the
exception of the representations, warranties and covenants expressly set forth
in this AGREEMENT, the SELLER shall sell and convey to the PURCHASER and the
PURCHASER shall accept the PROPERTY "as is, where is" and with all faults.
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Section 6.6. No Contracts. Other than this AGREEMENT, there are no
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other contracts of sale executed and in effect with purchasers of any portion of
the PROPERTY which predates the execution of this AGREEMENT.
Section 6.7. Representations: Limitations; Continuing; Etc. The
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representations, warranties and covenants made by the SELLER in this Article and
elsewhere in this AGREEMENT: (a) shall be materially true and correct on and as
of the date of the CLOSING; (b) shall have the same force and effect as though
made on and as of the CLOSING; (c) are made for the benefit of the BUYER; and
(d) shall survive the CLOSING for a period of sixty days following the date of
the CLOSING. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN THIS ARTICLE 6, THE
SELLER MAKES NO REPRESENTATION OR WARRANTY TO THE BUYER, EXPRESS OR IMPLIED,
WITH RESPECT TO THE SELLER, THE TERCO DIVISION, SELLER'S PROPERTIES (INCLUDING,
WITHOUT LIMITATION, THE PROPERTY), AND LIABILITIES AND OBLIGATIONS (INCLUDING,
WITHOUT LIMITATION, THE ASSUMED LIABILITIES), WHETHER ARISING BY STATUTE OR
OTHERWISE IN LAW, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR OTHERWISE.
ARTICLE 7
BUYER'S REPRESENTATIONS AND WARRANTIES
As an inducement to and to obtain the reliance of SELLER, BUYER
represents and warrants as follows:
Section 7.1. Organization. BUYER is a corporation duly organized,
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validly existing, and in good standing under the laws of Nevada and has the
corporate power and is duly authorized, qualified, franchised and licensed under
all applicable laws, regulations, ordinances and orders of public authorities to
own all of its properties and assets and to carry on its business in all
material respects as it is now being conducted, including qualification to do
business as a foreign corporation in the jurisdiction in which the character and
location of the assets owned by it or the nature of the business transacted by
it requires qualification. Included in the Schedules attached hereto
(hereinafter defined) are complete and correct copies of the articles of
incorporation, bylaws and amendments thereto as in effect on the date hereof.
The execution and delivery of this Agreement does not and the consummation of
the transactions contemplated by this Agreement in accordance with the terms
hereof will not violate any provision of BUYER's articles of incorporation or
bylaws. BUYER has full power, authority and legal right and has taken all action
required by law, its articles of incorporation, its bylaws or otherwise to
authorize the execution and delivery of this Agreement.
Section 7.2. Capitalization. The authorized capitalization of BUYER
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consists of 100,000,000 Common Shares, $0.001 par value per share, and
20,000,000 shares of Preferred Stock, $.001 par value. As of the date hereof,
BUYER has 41,997,000 common shares issued and outstanding and no shares of
preferred stock outstanding. Of the shares of common stock outstanding,
5,997,000 shares are free trading. The shareholder table, specifying which
shares are free trading is attached as Exhibit D. BUYER also has six option
agreements outstanding, representing the option to purchase a total of 5,300,000
shares exercisable at a price of $0.10. The Options Table listing all of BUYER's
outstanding options, none of which have been exercised to date, is attached as
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Exhibit E. All issued and outstanding shares are legally issued, fully paid and
nonassessable and are not issued in violation of the preemptive or other rights
of any person. BUYER has no other securities, warrants or options authorized or
issued.
Section 7.3. Subsidiaries. BUYER has one subsidiary containing its
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intellectual property and has no other assets or liabilities.
Section 7.4. Tax Matters: Books and Records. The books and records,
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financial and others, of BUYER are in all material respects true, complete and
correct and have been maintained in accordance with GAAP and other good business
accounting practices; and BUYER has no liabilities with respect to the payment
of any country, federal, state, county, or local taxes (including any
deficiencies, interest or penalties). The BUYER's SEC and other regulatory
filings are in all material respects true, complete and correct.
(a) The BUYER financial statements and all SEC filings made
within 12 months of the effective date of this agreement are hereby attached as
Exhibit E.
Section 7.5. Litigation and Proceedings. There are no actions, suits,
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proceedings or investigations pending or threatened by or against or affecting
BUYER or its properties, at law or in equity, before any court or other
governmental agency or instrumentality, domestic or foreign or before any
arbitrator of any kind that would have a material adverse affect on the
business, operations, financial condition or income of BUYER. BUYER is not in
default with respect to any judgment, order, writ, injunction, decree, award,
rule or regulation of any court, arbitrator or governmental agency or
instrumentality or of any circumstances which, after reasonable investigation,
would result in the discovery of such a default. Furthermore, BUYER has just
engaged in a series of transaction including a reverse merger, the BUYER
warrants and represents that the transaction were done in compliance with all
security and other regulatory laws.
Section 7.6. Material Contract Defaults. BUYER is not in default in any
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material respect under the terms of any outstanding contract, agreement, lease
or other commitment which is material to the business, operations, properties,
assets or condition of BUYER, and there is no event of default in any material
respect under any such contract, agreement, lease or other commitment in respect
of which BUYER has not taken adequate steps to prevent such a default from
occurring.
Section 7.7. Information. The information concerning BUYER as set forth
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in this Agreement and in the attached Schedules is complete and accurate in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact required to make the statements made in light
of the circumstances under which they were made, not misleading.
Section 7.8. Title and Related Matters. BUYER has good and marketable
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title to and is the sole and exclusive owner of all of its properties,
inventory, interest in properties and assets, real and personal (collectively,
the "Assets") free and clear of all liens, pledges, charges or encumbrances.
BUYER owns free and clear of any liens, claims, encumbrances, royalty interests
or other restrictions or limitations of any nature whatsoever and all
procedures, techniques, marketing plans, business plans, methods of management
or other information utilized in connection with BUYER's business. No third
party has any right to, and BUYER has not received any notice of infringement of
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or conflict with asserted rights of others with respect to any product,
technology, data, trade secrets, know-how, proprietary techniques, trademarks,
service marks, trade names or copyrights which, singly on in the aggregate, if
the subject of an unfavorable decision ruling or finding, would have a
materially adverse affect on the business, operations, financial conditions or
income of BUYER or any material portion of its properties, assets or rights.
Section 7.9. Compliance with Laws and Regulations. BUYER has complied
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with all applicable statutes and regulations of any federal, state or other
governmental entity or agency thereof, except to the extent that noncompliance
would not adversely affect the business, operations, properties, assets or
condition of BUYER or would not result in BUYER incurring material liability.
Section 7.10. Material Transactions or Affiliations. There are no
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material contracts or agreements of arrangement between BUYER and any person,
who was at the time of such contract, agreement or arrangement an officer,
director or person owning of record, or known to beneficially own ten percent
(10%) or more of the issued and outstanding Common Shares of BUYER and which is
to be performed in whole or in part after the date hereof. BUYER has no
commitment, whether written or oral, to lend any funds to, borrow any money from
or enter into material transactions with any such affiliated person.
Section 7.11. No Conflict With Other Instruments. The execution of this
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Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument to which BUYER is a
party or to which any of its properties or operations are subject.
Section 7.12. Governmental Authorizations. BUYER has all licenses,
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franchises, permits or other governmental authorizations legally required to
enable it to conduct its business in all material respects as conducted on the
date hereof. Except for compliance with federal and state securities and
corporation laws, as hereinafter provided, no authorization, approval, consent
or order of, or registration, declaration or filing with, any court or other
governmental body is required in connection with the execution and delivery by
BUYER of this Agreement and the consummation of the transactions contemplated
hereby.
ARTICLE 8
MISCELLANEOUS PROVISIONS
Section 8.1. No Brokerage Fees. The SELLER and the BUYER hereby
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represent that neither party has entered into any brokerage agreements or other
contractual relationships with any individual or entity ("THIRD PARTY") in
connection with the SALE which would entitle such THIRD PARTY to any brokerage
fees or commissions due in connection therewith. The SELLER and the BUYER agree
to indemnify and hold harmless the other party from and against all loss, claim,
damage or liability, including but not limited to costs and attorneys' fees,
which the BUYER or the SELLER, as the case may be, may suffer, incur or expend
due to a claim made by a THIRD PARTY that the other party entered into a
contractual relationship with the THIRD PARTY in connection with the SALE and
the THIRD PARTY is entitled to brokerage fees or commissions due in connection
therewith.
Section 8.2. Notices. Any notice required or permitted by or in
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connection with this AGREEMENT, without implying the obligation to provide any
such notice, shall be in writing and shall be made by Federal Express, or other
similar overnight delivery service, or by certified mail, unrestricted delivery,
return receipt requested, postage prepaid, addressed to the respective parties
at the appropriate address set forth below or to such other address as may be
hereafter specified by written notice by the respective parties. Independent of
the date of actual delivery or whether delivery is ever in fact made, as the
case may be, provided the giver of notice can establish the fact that notice was
given as provided herein, notice shall be considered given as of: (a) one (1)
business day after delivery to Federal Express or similar overnight delivery
service; or (b) three (3) calendar days after the date of mailing. If notice is
tendered pursuant to the provisions of this Section and is refused by the
intended recipient thereof, the notice, nevertheless, shall be considered to
have been given and shall be effective as of the date herein provided.
If to the SELLER: GREENTREE SPRAY TECHNOLOGIES, LLC.
c/o Xxxx Xxxxxx
000 Xxxx Xxx.
Xxxxxxx, XX 00000
With a copy to: Xxxx Xxxxxx
000 X Xxxx Xxxxxx #00
Xxxxx, XX 00000
If to the BUYER: NANO CHEMICAL SYSTEMS HOLDINGS, INC.
c/o Xxxxxxx Xxxxxxx
P.O. Box 10591
Xxxxxxxx, Xxxxxx 00000
With a copy to: Xxxxxx & Jaclin, LLP
Xxxxx X. Xxxxxx, Esq.
000 Xxxxx 0 Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxx Xxxxxx 00000
Section 8.3. Binding Obligation; Assignment. This AGREEMENT shall be
------------------------------
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. Neither the SELLER nor the BUYER may assign
its respective interest in this AGREEMENT without the prior written consent of
the other party hereto.
Section 8.4. Final Agreement. This AGREEMENT, all other documents
---------------
associated with the SALE (if any), the exhibits that are attached hereto and
made a part hereof, and any side letters, letter agreements, and amendments (if
any) that are executed by the SELLER and the BUYER in furtherance of this
AGREEMENT, contain the final and entire agreement and understanding of the
parties to this AGREEMENT, and any terms and conditions not set forth in this
AGREEMENT (or in such exhibits, side letters, letter agreements, and amendments)
are not a part of this AGREEMENT and the understanding of the parties hereto.
Section 8.5. Amendment. This AGREEMENT may be amended or altered only
---------
in writing signed by both of the parties hereto.
-11-
Section 8.6. Time. Time is strictly of the essence of this AGREEMENT.
----
Section 8.7. Choice Of Law. The laws of the State of Delaware shall
-------------
strictly govern the rights and obligations of the parties to this AGREEMENT
without regard to choice or conflict of law rules of the State of Delaware or
any other jurisdiction, and the interpretation and construction and
enforceability thereof and any and all issues relating to the transactions
contemplated herein.
Section 8.8. Tax Matters. This transaction is part of a plan where Nano
-----------
Chemical Systems Holdings, Inc. is being transformed into a Nano technology
company which has both the intellectual property and the actual ability to
manufacture aerosol cans for the purpose of putting nano TiO2 into a spray can
in order to protect golf shirts and other fabrics from UV radiation ans to
reduce the fading. The broader strategy is to use nano technology to enhance the
products which GreenTree has been filling for a number of years, hopefully
increasing both product functionality and marketability. Pursuant to this
strategy, Treya , Cleburn, and Seller have transferred in assets for which, as a
group, they will own over 80% of the BUYER. The transaction is structured and is
intended to be a Section 351/357 transaction for tax purposes. The parties agree
to file the necessary documentation to insure that this tax treatment will be
accomplished.
Section 8.9. Number, Gender, And Captions. As used herein, the singular
----------------------------
shall include the plural and the plural may refer to only the singular. The use
of any gender shall be applicable to all genders. The captions contained herein
are for purposes of convenience only and are not a part of this AGREEMENT.
Section 8.10. Partial Invalidity. If any term, covenant or condition of
------------------
this AGREEMENT or its application to any person or circumstances shall be
invalid or unenforceable, the remainder of this AGREEMENT, or the application of
such term or provision to persons or circumstances other than those to which it
is held invalid or unenforceable shall not be affected, and each term shall be
valid and enforceable to the fullest extent permitted by law.
Section 8.11. Interpretation. If any date upon which action is required
--------------
under this AGREEMENT shall be a Saturday, Sunday, or legal holiday, the date for
such action shall be extended to the first regular business day after such date
which is not a Saturday, Sunday, or legal holiday.
Section 8.12. Counterparts; Facsimile Signature Pages. This AGREEMENT
---------------------------------------
may be executed in any number of counterparts, each of which shall be deemed to
be an original as against any party whose signature appears thereon, and all of
which shall together constitute one and the same instrument. Any facsimile
signature of any party hereto or to any other agreement or document executed in
connection herewith shall constitute a legal, valid and binding execution by
such party.
[SIGNATURES BEGIN ON THE NEXT PAGE.]
-12-
IN WITNESS WHEREOF, the SELLER and the BUYER execute and seal this
AGREEMENT as of the date first above written (notwithstanding the actual date of
execution and delivery hereof), with the specific intention that this AGREEMENT
constitutes a document under seal. This AGREEMENT may be executed in
counterparts and may be delivered via facsimile transmission.
WITNESS/ATTEST: The SELLER:
GREEN TREE SPRAY TECHNOLOGIES, LLC,
A Delaware Limited Liability Company
----------------------------------
By: /s/ Xxxx Xxxxxx (SEAL)
------------------------
Name: Xxxx Xxxxxx
------------------------
Title: Managing Member
------------------------
WITNESS/ATTEST: The BUYER:
NANO CHEMICAL SYSTEMS HOLDINGS, INC.,
A Nevada Corporation
------------------
By: /s/ Xxxxxxx Xxxxxxx (SEAL)
------------------------
Name: Xxxxxxx Xxxxxxx
------------------------
Title: President
------------------------
-13-
EXHIBIT "A"
CUSTOMERS
EXHIBIT "B"
ASSETS
EXHIBIT "C"
PRODUCTS
EXHIBIT "D"
CAPITALIZATION TABLE
EXHIBIT "E"
OPTIONS TABLE
EXHIBIT "F"
BUYER'S FINACIALS AND SEC FILINGS
EXHIBIT "G"
SELLER'S AUDITED ASSET VALUE STATEMENT
EXHIBIT "H"
FORM OF PROMISSORY NOTE
-14-
EXHIBIT "A"
CUSTOMERS
PIONEER
FINISH LINE
MOLD MEDIC
PENETONE
DURO DYNE
SAINT GOBAIN
-15-
EXHIBIT "B"
ASSETS
XXXXX LINE $177,395.03
TANK FARM $196,097.53
INV.RAW MAT $416,473.68
INV.F/G AT RETAIL $23,033.76
MACOLA SYSTEM $45,000.00
FORMULATIONS $142,000.00
GOODWILL $100,000.00
TOTAL $1,100,000.00
-16-
EXHIBIT "C"
PRODUCTS
Pioneer Finish Line
------- -----------
PPQSGDBURGANDY FL X00000000
PPQSGDGRAY FL B00120101
PPQSGDGREEN FL C00020101
PPQSGDNAVBLUE FL C00040101
PPQSGDO FL C00080101
PPQSGDRB FL C10120101
PPQSGDRED FL X00000000
PPQSGDROYPURP FL CS
PPQSGDW FL CS24
PPQSGDY FL D00100101
PPQS-18-BLACK FL D00110101
PPQS-18-BLUE FL D00112101
PPQS-18-BURGAND FL X00000000
PPQS-18-DKGAR FL D12080101
XXXX-00-XXXX XX XX0000000
PPQS-18-GREEN FL DM6
XXXX-00-XXXXXX XX XX XX0-00
XXXX-00-XXXXXXX XX DP SIL-96
PPQS-18-OLDGOLD FL DP WHY GR-96
PPQS-18-ORG FL DS0140101
PPQS-18-PURPLE FL DS6
PPQS-18-RED FL DUPONT
XXXX-00-XXXXXXX XX XX0000000
PPQS-18-WHT FL DW6
PPQS-18-YELGOLD FL E00060101
PVIP-20-BLK FL E00120101
PVIP-20-BLU FL E01080101
PVIP-20-BURGAND FL EPIC
PVIP-20-DKGAR FL X00000000
PVIP-20-GREEN FL P00080101
PVIP-20-NAVBLUE FL PD-55G
PVIP-20-OLDGOLD FL S00170101
PVIP-20-ORG FL S00170201
PVIP-20-RED FL S00170301
PVIP-20-ROYPURP FL S00170501
PVIP-20-YLW FL S00170601
PVIP-22-WHT FL S00170701
SOLV-PP FL S00171101
SOLV-PP-2 FL S00171201
FL X00000000
FL S00240801
FL T00020101
FL T00040101
FL T00060101
FL T00080101
FL T00110101
FL T00170101
FL T00170801
FL W40090102
FL W50040102
FL W50080102
FL W50090102
FL WL.5
-00-
Xxxx Xxxxx Xxxxxxxx
---------- --------
MM 6110F PN 1287
MM 6150-3CIN PN 1667
MM 6150-3MARINE PN AIR
MM 6150-3NC PN C328
MM 6150-3PINC PN CK
MM 6150-3RAIN PN FW
MM 6150-3VAN PN G919
MM 6150-3WCH PN HD1-18
MM BB COVR SCNT PN HD1-22
MM XX XXX PN HD4RTU
MM BB XXX XXXX PN HD4RTUP
MM BB ESTRUS DO PN INOS
MM BB WATER PN INOSTB
MM BB YNG XXXX XX L805A
MM ENCP PN L805P
MM SF PN L945A
MM SF20 PN L945P
PN M5572B
PN MIL
PN PB2000
PN PS101
PN PS102
PN RCOS
PN TPC
PN TPC13
PN TPC16
PN TPCTB
PN WNB
Norton Performance
------------------
NP CP894
NP CP94
NP FB894
NP FB94
Duro Dyne
---------
DD SS
-18-
EXHIBIT "D"
CAPITALIZATION TABLE
FREE TRADING SHARES NO. OF SHARES
Xxxxx Xxxxx 1,000
Xxxxxxx Algright 10,000
Xxxxxx Xxxxxxxx 2,000
Xxxxxx X. Xxxxxx 2,000
Xxxxx Xxxxxx 2,000
Xxxxx X. Xxxx 1,200
Xxxxx X. Xxxxxxxx 2,000
Xxxxx Xxxxxxxx 20,000
Xxxxx Xxxxxxxx 9,000
Dallyn Bleafzard 8,000
Xxxxxx Xxxxxxxx 8,000
Xxxxx Xxxxxxxx 10,000
Xxxxxxx Xxxxxxxx 1,000
Xxxxxxx Xxxxxxxx 2,000
Xxxx Xxxxxxxxx 8,000
CEDE & company 592,000
Xxxxxxxxxxx Xxxxxx & Xxxxxxx Xxxxxx JTTN 20,000
Xxxxxxx Xxxxxx & Xxxxxxxxxxx Xxxxxx JTTN 20,000
Xxxxx Xxxx 1,000
Xxxxxx Xxxxxxx 800
Xxxx Xxxxxxxxx 4,000
Xxxxxxx X. Xxxxxxx 8,000
Xxx Xxxxxxxx 4,000
Xxxx Xxxxxx 4,000
Xxxx Xxxxxxxx 2,000
Xxxxxxxx Xxxx Xxxxx 1,000
Xxxx Xxxxxxxx 6,000
Xxxx X. Xxxx 2,000
Xxxxxxx X. Xxxxxxxx 2,000
Interactive Consulting Services 2,000
Xxxxxxx Xxxxxxx 4,000
Xxxxx Xxxxx 20,000
Xxxxx Xxxxx 2,000
Xxxx Xxxx 2,000
Xxxxxx Xxxxxx 4,000
Xxxx X. XxXxxxx 1,000
Xxxxxx Xxxxxxxx 4,000
Xxxxxx X. Xxxxx 4,000
Xxxx Xxxx 4,000
Xxxxx Xxxxx 20,000
Xxxxx Xxxxx 20,000
Xxxxxxxx Xxxxx 20,000
Stock Investment Corporation 4,000
Xxxxxxx Xxxxxxx 20,000
Xxxxx Xxxxxx 1,000
Xxxxx Xxxx 12,000
Xxxxxxx Xxxxxxx 80,000
Xxxxxx Xxxxxxxx 1,780,000
Xxxxxxx Xxxxxxxxx 1,900,000
Xxxxxx Masterdepetero 1,340,000
---------------------
TOTAL 5,997,000
-
RESTRICTED SHARES -
Xxxxxxx Xxxxxxx 4,000,000
Treya, Inc. 8,000,000
Green Tree Shareholders 24,000,000
---------------------
TOTAL 36,000,000
TOTAL SHARES OUTSTANDING 41,997,000
-19-
EXHIBIT "E"
OPTIONS TABLE
# OF SHARES (1) DATE VESTED
------------ -----------
Option #1 granted 1/1/2004 1,120,000 12/31/2004
1,400,000 6/30/2005
280,000 6/30/2006
Option #2 granted 7/1/2001 240,000 12/31/2002
300,000 6/30/2004
60,000 6/30/2005
Option #3 granted 7/1/2001 120,000 12/31/2002
150,000 6/30/2004
30,000 6/30/2005
Option #4 granted 7/1/2001 240,000 12/31/2002
300,000 6/30/2004
60,000 6/30/2005
Option #5 granted 7/1/2001 160,000 12/31/2002
200,000 6/30/2004
40,000 6/30/2005
Option #6 granted 7/1/2001 240,000 12/31/2002
300,000 6/30/2004
60,000 6/30/2005
----------------------------------- ---------------------- ------------------
TOTAL 5,300,000
(1) All options are owned by Xxxxxx Xxxxxxxx and are exercisable at a
price of $0.10 per share.
-20-
EXHIBIT "F"
BUYER'S FINACIALS AND SEC FILINGS
EXHIBIT "G"
SELLER'S AUDITED ASSET VALUE STATEMENT
EXHIBIT "H"
FORM OF PROMISSORY NOTE
-21-
