Exhibit 99.1
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THIS
SHARE PURCHASE AGREEMENT (this “Agreement”) is made and entered into
as of the 31st day of December, 2008, by and among Defense Industries
International, Inc, a company organized under the laws of the State of Nevada (“Defense”),
Achidatex Ltd., a company organized under the laws of the State of Israel, company No.
510477839 (“Achidatex”), Xx. Xxxxxxx Xxxxxx, Israeli I.D. 007967375 (“Hatzor”),
Xx. Xxxxx Daviedowitz, Israeli I.D. 001361476 (“Xxxxx”) and Mr. Shmuel
Daviedowitz, Israeli I.D. 001361492 (“Xxxxxx”. Xxxxxx, Xxxxx and Xxxxxx
together are the “Sellers”). |
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Defense,
Achidatex and the Sellers shall be referred to in this Agreement individually as a “Party” and
collectively as the “Parties.” |
WHEREAS,
the Sellers are the sole shareholders of Achidatex; and
WHEREAS, Achidatex
is the holder and owner of 980,931 shares of common stock US$ 0.0001 par value per share
of Defense (the “Common Stock” and the “Achidatex
Shares,” respectively); and
WHEREAS,
the Sellers individually are the holders and owners of 69,069 shares of Common Stock (the
“Sellers Shares”),with each Seller being a holder and owner of 23,023
shares of Common Stock; and
WHEREAS,
the Sellers and Achidatex desire to sell, and Defense desires to purchase from the Sellers
and Achidatex the Sellers Shares and the Achidatex Shares, respectively (the Sellers
Shares and the Achidatex Shares and together the “Defense Shares”),
subject to and under the terms and conditions set forth herein; and
WHEREAS,
the Sellers are the holders and owners of 240 Management Shares NIS 0.1 par value of
Achidatex Nazareth Elite (1977) Ltd (“ANE” and the “Management
Shares,” respectively), with each Seller being the holder and owner of 80
Management Shares; and the Sellers are the holders and owners of 801,360 Ordinary Shares
NIS 1 par value of ANE (the “Ordinary Shares”), with each Seller being
the holder and owner of 267,120 Ordinary Shares (the Management Shares and the Ordinary
Shares (together the “ANE Shares”); and
WHEREAS,
Defense, through Export Erez USA, Inc. (“Export”), a wholly owned
subsidiary of Defense, and the Sellers are the sole shareholders of ANE; and
WHEREAS,
the Sellers desire to sell, and Defense (and/or Export, upon Defense sole discretion)
desires to purchase from the Sellers the ANE Shares, subject to and under the terms and
conditions set forth herein;
NOW,
THEREFORE, in consideration of the mutual promises, representations, warranties,
covenants and conditions set forth in this Agreement, the Parties mutually agree as
follows:
| 1. |
Purchase
of the Defense Shares. |
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Subject
to the terms and conditions of this Agreement, Achidatex and the Sellers hereby agree to
sell and Defense agrees to purchase the Defense Shares, as follows: |
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1.1. |
Achidatex
hereby agrees to sell to Defense and Defense agrees to purchase from Achidatex
the Achidtaex Shares. |
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1.2. |
The
Sellers hereby agree to sell to Defense and Defense agrees to purchase from the
Sellers the Sellers Shares, each Seller selling 23,023 shares of Common Stock. |
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1.3. |
Following
the purchase of the Defense Shares by Defense, the Sellers and Achidatex shall
no longer be shareholders of Defense. |
| 2. |
Purchase
of the ANE Shares. |
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Subject
to the terms and conditions of this Agreement, the Sellers hereby agree to sell to
Defense and Defense agrees to purchase from the Sellers the ANE Shares, as follows: |
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2.1. |
The
Management Shares, each Seller selling 80 Management Shares. |
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2.2. |
The
Ordinary Shares, each Seller selling 267,120 Ordinary Shares. |
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2.3. |
Following
the purchase of the ANE Shares by Defense, the Sellers shall no longer be
shareholders of ANE and Defense shall be the sole shareholder of ANE. |
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In
consideration for the purchase of the Defense Shares and the ANE Shares, Defense shall
pay Achidatex and the Sellers at the Closing Date, as defined in Section 6 below, the
following sums: |
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3.1. |
US$
0.30 per share in consideration for the purchase of the Defense Shares, for a
total purchase price of US$ 315,000. |
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Defense
shall pay each of the Sellers the sum of US$ 6,906.90 in consideration for each Sellers’ portion
of the Sellers Shares (the “Sellers Consideration”) and shall pay
Achidatex the sum of US$ 294,279.30 in consideration for the Achidatex Shares (the “Achidatex
Consideration”). |
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3.2. |
The
total purchase price of US$ 885,000 for the purchase of the ANE Shares (the
“ANE Consideration”) which will be distributed equally among
each of the Sellers – US$ 295,000 each. |
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At
the Closing Date of this agreement the actual payment to the Sellers and to Achidatex
shall be made in US$ by wire transfer to their respective bank accounts (details of which
will be given in writing to Defense at least 48 hours before the Closing Date),
banker’s cheque, or such other form of payment as is mutually agreed upon by the
Parties. |
| 4. |
Representations
and Warranties of the Sellers and Achidtax to Defense |
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Each
of the Sellers and Achidatex hereby, jointly and not separately, represent, warrant and
undertake to Defense the following representations and warranties are true and correct as
of the date hereof: |
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4.1. |
Ownership
of Shares. |
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4.1.1. |
As
of the date of this Agreement the Sellers’ and Achidatex’s holdings
in Defense are as follows: |
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(i) |
Achidatex
– 980,931 shares of Common Stock. |
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(ii) |
Hatzor
– 23,023 shares of Common Stock. |
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(iii) |
Xxxxx
– 23,023 shares of Common Stock. |
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(iv) |
Xxxxxx
– 23,023 shares of Common Stock. |
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4.1.2. |
As
of the date of this Agreement the Sellers holdings in ANE are as follows: |
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(i) |
Hatzor
– 80 Management Shares and 267,120 Ordinary Shares. |
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(ii) |
Xxxxx
– 80 Management Shares and 267,120 Ordinary Shares. |
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(iii) |
Xxxxxx
– 80 Management Shares and 267,120 Ordinary Shares. |
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4.1.3. |
The
Sellers and Achidatex are the registered owners of the Sellers Shares, the ANE
Shares and the Achidatex Shares, respectively, and they are the sole owners of
such shares holding any and all rights emanating from or connected to the such
shares. |
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4.1.4. |
The
Defense Shares and the ANE Shares are free and clear of all liens, charges,
attachments, encumbrances and any third party rights. The Sellers and Achidatex
further warrant and undertake that no third party was granted by any of them or
is entitled to, in any manner whatsoever, by law and/or by any agreement,
promise, assignment or otherwise, any rights, complete or partial, in the
Defense Shares and/or the ANE Shares or in any rights, payments and/or
benefits, emanating from such shares or connected to such shares. |
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4.2. |
Authorization.
All action on the part of Achidatex and its officers, directors and
shareholders necessary for the authorization, execution and delivery of this
Agreement, the performance of all its obligations hereunder, and the
authorization sale and delivery of the Achidatex Shares hereunder has been duly
taken and is in full force and effect and were approved in accordance with
Achidatex’s bylaws. |
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This
Agreement constitutes the valid and legally binding obligations of Achidatex and of each
of the Sellers, enforceable in accordance with its terms. To Achidatex’s and the
Sellers’ knowledge, no consent, approval, order, license, permit, action by, or
authorization of or designation, declaration, or filing with any governmental authority
on the part of Achidatex and/or any of the Sellers is required in connection with the
valid execution, delivery and performance of this Agreement and the transfer, sale and
delivery of the Defense Shares and/or the ANE Shares, respectively, in accordance with
this Agreement. Furthermore, no consent or approval is required on the part of Achidatex
and/or any of the Sellers from any other third party for the authorization, execution,
delivery and performance of this Agreement and the authorization, transfer, sale and
delivery of the Defense Shares and/or of the ANE Shares, respectively, in accordance with
this Agreement. |
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4.3. |
Representations
and Warranties at Closing Date. The representations and warranties of the
Sellers and Achidatex shall be true and correct when made and as of the Closing
Date, as defined in Section 6, with the same effect as though made on and as of
the date hereof. |
| 5. |
Representations
and Warranties of Defense. |
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Defense
hereby represents and warrants to the Sellers and to Achidatex that it has duly executed
and delivered this Agreement, which is a valid and binding agreement of Defense and was
approved in accordance with the Defense’s bylaws. The representations and warranties
of Defense shall be true and correct when made and as of the Closing Date, as defined in
Section 6, with the same effect as though made on and as of the date hereof. |
| 6. |
Transfer
of the Shares and Closing. |
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Not
later than January 15th, 2009 or at such other time and place as the Parties
will mutually agree (“Closing Date”), the following actions will be taken
and shall be considered as taken simultaneously and the occurrence or completion of any
such transaction or action, no transaction shall be deemed to have been completed and no
action shall be deemed as taken or document delivered unless and until all have been
taken, delivered and completed: |
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6.1. |
The
Sellers shall (i) sign stock powers regarding the transfer of the Sellers
Shares to Defense in consideration of the Sellers Consideration; and (ii)
return to Defense share certificates in the amount of the Sellers Shares; and
(iii) sign transfer of share deeds regarding the transfer of the ANE Shares to
Defense in consideration of the ANE Consideration. |
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6.2. |
Achidatex
shall (i) sign a stock power regarding the transfer of the Achidatex Shares to
Defense in consideration of the Achidatex Consideration; and (ii) return to
Defense share certificates in the amount of the Achidatex Shares; |
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6.3. |
Hatzor
shall resign as director of ANE and sign a waiver in favour of ANE in the form
attached as Schedule 6.3; Defense hereby undertakes to
include Hatzor in Achidatex’s directors and officers liability insurance
for a period of no less than two (2) years from the Closing date; |
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6.4. |
Defense
shall pay (i) each of the Sellers the Sellers Consideration in consideration of
the Sellers Shares, as provided in Section 3.1; and (ii) each of the Sellers
his portion of the ANE Consideration in consideration of the ANE Shares, as
provided in Section 3.2; and (iii) Achidatex the Achidatex Consideration in
consideration of the Achidatex Shares, as provided in Section 3.1; |
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6.5. |
Defense
shall furnish the Sellers and Achidatex with a legal opinion stating that there
is no legal prevention what so ever from Defense to purchase the Defense Shares
(the “Legal Opinion”) in the form attached hereto as Schedule 6.5. |
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6.6. |
Defense
hereby undertakes to release the Sellers and/or Achidatex from all guarantees
and/or securities given and/or granted by the Sellers and/or Achidatex,
respectively, in relation to Defense and/or ANE, including, without limitation,
the guarantees and/or securities listed in Schedule 6.6 attached to
this Agreement (the “Guarantees and Securities”), and shall be
liable for all Guarantees and Securities. Defense undertakes to sign the
necessary documents required to effectuate said release from the Guarantees and
Securities. Defense shall make its best efforts to release the Guarantees and
Securities within 90 days following the Closing Date. |
| 7. |
Indemnification;
Remedies. |
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7.1. |
Survival.
The representations and warranties made by Achidatex and the Sellers in Section
4 and by Defense in section 5 of this Agreement shall survive the date of this
Agreement for a period of two (2) years). |
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7.2. |
Indemnification
by Achidatex and the Sellers. Subject to the limitations set forth in
Section 7.3 below, Achidatex and the Sellers, jointly and not severally, shall
indemnify and hold harmless Defense and its respective, directors, officers and
representatives (collectively, the “Indemnified Persons”), and
will reimburse the Indemnified Persons for any loss, liability, claim, damage,
expense (including reasonable attorneys’ fees) (collectively, the “Damages”),
arising from or in connection with any misrepresentation or breach of warranty
of Achidatex and/or the Sellers, specified in Section 4 (collectively, a
“Misrepresentation”). In any case, such Damages will not
exceed the consideration paid by Defense to the Sellers and Achidatex in
accordance with Section 3. |
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7.3. |
Limitation.
No claims shall be asserted under this Section unless the aggregate amount
claimed is in excess of US$ 20,000, in which event a claim may be submitted for
the entire amount at issue and Achidatex and/or the Sellers shall be liable
from the first dollar amount of any such claim. |
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The
above limitation shall not apply with respect to fraud or intentional Misrepresentation. |
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The
Sellers and Achidatex hereby undertake to hold in confidence all information concerning
Defense and/or ANE (the “Companies”), which under the circumstances would
be deemed confidential or classified as such, with respect to the Companies’
business, financial, commercial and technical information, including without limitation,
information pertaining to the Companies’ technology, products and know-how,
operations and plans, including such information provided to the Sellers and/or Achidatex
prior to execution hereof or to which it was exposed (“Confidential
Information”); shall not disclose Confidential Information without Defense’s
prior written consent and shall not use Confidential Information for any purpose
whatsoever without the Defens’s prior written consent. |
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The
confidentiality obligation shall not apply, to information which the Sellers and/or
Achidatex can prove by written record: (i) is or becomes generally available to the
public other than by reason of breach of the confidentiality undertaking under this
agreement; (ii) was or shall have been lawfully transmitted or disclosed to the
Sellers and/or Achidetx by a third party; or (iii) is properly required by law,
regulation, or court order or other judicial decree to be disclosed by the Sellers and/or
Achidatex; provided, however, that, to the extent reasonably feasible, the
Sellers and/or Achidatex shall provide Defense with advance written notice of any such
required disclosure and; and provided further that the Sellers and/or Achidatex
will make such disclosure only to the extent the disclosure is required. |
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In
the event that Defense shall breach its obligations to pay the Sellers and/or Achidatex
the consideration or any part of as provided in Section 6.4, then, in addition to any
other remedies available to the Sellers and/or Achidatex by applicable law, Defense shall
pay the Sellers a lump sum equal to US$ 180,000 as a termination fee. |
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10.1. |
Entire
Agreement; Binding Effect. This Agreement, the documents referred to herein
constitute the entire agreement among the parties with respect to the subject
matter hereof, and no party shall be liable or bound to any other Party in any
manner by any warranties, representations or covenants with respect to such
subject matter, except as specifically set forth herein or therein. The terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective successors and assigns of the Parties. Nothing in this
Agreement, express or implied, is intended to confer upon any third party any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement. This Agreement
replaces and nullifies any previous document signed between the parties in
relation to the said transaction. |
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10.2. |
Counterparts
and Signature by Facsimile. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The facsimile signature
of any Party for purposes of execution or otherwise is to be considered as an
original signature, and the document transmitted is to be considered to have
the same binding effect as an original signature on an original document. At
the request of any Party, any facsimile or telecopy document shall be
re-executed in original form by the Parties who executed the facsimile or
telecopy document. No Party may raise the use of a facsimile machine or the
fact that any signature was transmitted through the use of a facsimile machine
as a defense to the enforcement of this Agreement or any notice required
thereof. |
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10.3. |
Headings.
The headings used in this Agreement are used for convenience only and are not
to be considered in construing or interpreting this Agreement. |
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10.4. |
Notices.
Any notice provided to the parties herein shall be in writing, to such party’s
address set forth in Schedule 10.4 attached hereto and
shall be effective (i) if mailed (via registered mail), 5 business days after
mailing, (ii) if sent by messenger, upon delivery, and (iii) if sent via
facsimile, on the first business day following transmission and electronic
confirmation of receipt. |
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10.5. |
Severability.
In case any provision of this Agreement shall be invalid, illegal or
unenforceable, it shall to the extent practicable be modified so as to make it
valid, legal and enforceable and to retain as nearly as practicable the intent
of the parties, and the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby. |
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10.6. |
Delays
or Omissions. No delay or omission to exercise any right, power, or remedy
accruing to any party upon any breach or default under this Agreement, shall be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent, or approval of any kind or character on
the part of any Party of any breach or default under this Agreement, or any
waiver on the part of any Party of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any of the parties, shall be
cumulative and not alternative. |
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10.7. |
Governing
Law and Jurisdiction. All disputes arising under this Agreement or in
connection with the transactions hereunder shall be resolved between the
Parties in good faith, however, if these efforts fail the dispute shall be
resolved in accordance with the laws of the State of Israel excluding that body
of law pertaining to conflict of law. The competent courts of Tel Aviv shall
have sole and exclusive jurisdiction over any issue arising out of or in
connection with this Agreement. |
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10.8. |
Assignment.
Neither of the parties to this Agreement may assign any of its rights and/or
obligations in accordance with this Agreement without the prior written consent
of the other parties; without derogating from the above, it is agreed that
Defense may purchase the ANE through Export upon its discretion. In such case,
it shall continue to be liable all its obligation in accordance with this
agreement. |
IN WITNESS WHEREOF, the
parties hereto have executed this Share Purchase Agreement as of the date first above
written.
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Defense Industries International, Inc |
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Achidatex Ltd |
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By:
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By:
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Avraham Xxxxxx |
Xxxxx Daviedowitz |
Xxxxxx Daviedowitz |
