Exhibit No. 2.2
Form 8-K
Transform Pack International, Inc.
File No. 000-31727
PUT OPTION AGREEMENT
This PUT OPTION AGREEMENT is made and entered into this 28th day of May
2003, by and between TRANSFORM PACK INTERNATIONAL, INC., a Minnesota corporation
(the "Company") and XXXX XXXXX, XXXXXXXX XXXXXXX, XXXXXX XXXXX and XXXXXX
XXXXXX, TRUSTEE, collectively the "Purchasers."
RECITALS
WHEREAS, the Company has entered into the Exchange Agreement dated May 28,
2003, pursuant to which the Company will acquire Quantum HIPAA Consulting Group,
Inc. ("Quantum"). As a result of the transaction with Quantum, the former
stockholders of Quantum will acquire a controlling interest in the Company.
WHEREAS, as a negotiated element of the transaction with Quantum, the
Company agreed to obtain an option to divest itself of its operating subsidiary,
Transform Pack, Inc., a New Brunswick corporation ("TPI"), after new management
of the Company has an opportunity to evaluate the operations of TPI in relation
to the business operations of Quantum.
WHEREAS, the Purchasers have had substantial involvement with the
development of the business of TPI and desire to purchase TPI in the event the
Company elects to divest itself of TPI.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing Recitals, which are
incorporated herein, and the terms and conditions hereinafter set forth, the
parties hereto agree as follows:
1. Option. During the period commencing May 29, 2003 and continuing through
November 30, 2003, the Company may, at its election, by written notice to the
Purchasers put and sell to the Purchasers 2,000,000 shares of the no par value
common stock of TPI (the "TPI Stock"), which is all of the issued and
outstanding common shares of TPI. The written notice shall specify the closing
date of the sale, which shall be not less than one, nor more than ten, business
days following the date of the notice. The parties agree and acknowledge that
this option is coupled with an interest and is irrevocable.
2. Purchase Price. The purchase price for the TPI Stock is 7,000,000 shares
(prior to any reverse split contemplated by the Exchange Agreement with Quantum)
of the common stock, par value $0.004, to be conveyed and transferred by the
Purchasers to the Company (the "Company Stock"). Concurrently with the execution
of this Agreement, Purchasers are delivering to the Company the certificates
representing the Company Stock (including duly executed stock
powers with signature guarantees) to the Company's counsel, Cohne, Xxxxxxxxx &
Xxxxx, P.C., with the understanding and agreement that these items will be
delivered to the Company at the time of closing of the purchase transaction
contemplated by this Agreement. Concurrently with the execution of this
Agreement, the Company is delivering to the Company's counsel the certificates
representing the TPI Stock duly endorsed for transfer per the instructions of
the Purchasers that the TPI Stock be issued and delivered to the persons and in
the amounts specified on Exhibit B attached hereto, with the understanding and
agreement that the certificates will be delivered at the time of closing of the
purchase transaction contemplated by this Agreement.
3. Additional Terms of Purchase. The parties hereto agree to the following
additional terms and conditions of purchase.
(a) The "Effective Date" of the sale of the TPI Stock for all financial
reporting and tax purposes shall be deemed to be the close of business on the
last day of the calendar month ended immediately preceding the date of closing.
(b) After the Effective Date the parties shall, and shall cause their
respective directors and officers to, cooperate fully with each other in the
preparation of all financial statements and tax returns and shall provide, or
cause to be provided to each other, any records and other information requested
by such parties in connection therewith.
(c) Each of the Purchasers, jointly and severally, agree to indemnify and
hold harmless the Company and its directors, officers, stockholders, employees,
affiliates, agents and assigns from and against any and all costs, damages,
disbursements, expenses, liabilities, losses, deficiencies, penalties, or
settlements of any kind or nature, whether foreseeable or unforeseeable,
including, but not limited to, interest, penalties, legal, accounting and other
professional fees and expenses incurred in the investigation, collection,
prosecution, and defense of claims and amounts paid in settlements that may be
imposed on or otherwise incurred by any of the foregoing indemnified persons,
that are based upon or arise from (i) any inaccuracy in or breach or
non-performance of any of the representations, warranties, covenants, or
agreements made by any of the Purchasers in or pursuant to this Agreement, (ii)
all liabilities of TPI as of the Effective Date that were in any way related to
the operations and activities of TPI prior to the Effective Date, whether known
or unknown, contingent or fixed, except for those liabilities listed on Exhibit
A attached hereto; and (iii) the operations and activities of TPI from and after
the Effective Date.
(d) The Company agrees to indemnify and hold harmless the each of the
Purchasers and their respective affiliates, agents and assigns from and against
any and all costs, damages, disbursements, expenses, liabilities, losses,
deficiencies, penalties, or settlements of any kind or nature, whether
foreseeable or unforeseeable, including, but not limited to, interest,
penalties, legal, accounting and other professional fees and expenses incurred
in the investigation, collection, prosecution, and defense of claims and amounts
paid in settlements that may be imposed on or otherwise incurred by any of the
foregoing indemnified persons, that are based upon or arise from (i) any
inaccuracy in or breach or non-performance of any of the representations,
warranties, covenants, or agreements made by the Company in or pursuant to this
Agreement; (ii) the liabilities of the Company as of the Effective Date listed
on Exhibit A
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attached hereto; and (iii) the operations and activities of the Company from and
after the Effective Date.
4. Representations of the Company. The Company represents and warrants to the
Purchasers as follows:
(a) The Company is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Minnesota.
(b) The Company has full power and authority (including full corporate
power and authority) to execute and deliver this Agreement to perform its
obligations hereunder. The execution and delivery of this Agreement and the
performance by the Company and the consummation of the transaction contemplated
hereunder have been duly authorized by the board of directors of the Company and
no other corporate proceedings on the part of the Company are required or
necessary to authorize this Agreement and the transactions contemplated
hereunder. This Agreement constitutes the legally valid and binding obligation
of the Company enforceable against the Company in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, and other similar laws and equitable principles
relating to or limiting creditors' rights generally.
(c) The Company has, and will have at closing, good record and marketable
title to the TPI Stock free and clear of all claims, charges, easements,
encumbrances, covenants, security interests, liens, options, pledges, and rights
of others, whether imposed by agreement, understanding, law, equity, or
otherwise, except for any restrictions on transfer generally arising under any
applicable federal or state securities laws, and delivery of the TPI Stock
conveys to the Purchasers good and marketable title to such property free and
clear of any claims, charges, easements, encumbrances, covenants, security
interests, liens, options, pledges, and rights of others.
5. Representations of Purchasers. Each of the Purchasers, jointly and severally,
as to each representation and warranty set forth below, represent, warrant and
agree as follows:
(a) Each Purchaser has full power and authority, and has taken all action
required by law and otherwise to execute and deliver this Agreement and to
perform its obligations hereunder. This Agreement represents the valid and
binding obligation of each Purchaser enforceable in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, and other similar laws and equitable principles
relating to or limiting creditors' rights generally.
(b) Each Purchaser is, and will be at closing, the legal and beneficial
owner of the Company Stock set forth on signature page to this Agreement, free
and clear of all claims, charges, easements, encumbrances, covenants, security
interests, liens, options, pledges, and rights of others, whether imposed by
agreement, understanding, law, equity, or otherwise, except for any restrictions
on transfer generally arising under any applicable federal or state securities
laws, and delivery of the Company Stock conveys to the Company good and
marketable title to such
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property free and clear of any claims, charges, easements, encumbrances,
covenants, security interests, liens, options, pledges, and rights of others.
6. Miscellaneous.
(a) All of the representations and warranties of the parties contained in
this Agreement shall survive the closing hereunder for a term of two years.
(b) This Agreement shall not confer any rights or remedies upon any person
other than the parties and their respective successors and permitted assigns.
(c) This Agreement (including the documents referred to herein) constitutes
the entire agreement between the parties and supersedes any prior
understandings, agreements, or representations by or between the parties,
written or oral, to the extent they relate in any way to the subject matter
hereof.
(d) This Agreement shall be binding upon and inure to the benefit of the
parties named herein and their respective successors and permitted assigns. No
party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of the other parties.
(e) This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together will constitute one
and the same instrument.
(f) The section headings contained in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or interpretation
of this Agreement.
(g) All notices, requests, demands, claims, and other communications
hereunder will be in writing. Any notice, request, demand, claim, or other
communication hereunder shall be deemed duly given (i) two business days after
sent by registered or certified mail, return receipt requested, postage prepaid,
and addressed as set forth below, (ii) one business day after sent next day
delivery by a courier service that guarantees next day delivery, courier fees
prepaid, and addressed as set forth below, or (iii) on the date sent by
telefacsimile, receipt confirmed:
If to the Company: Xx. Xxxx X. Xxxxxxxx
Transform Pack International, Inc.
Quantum HIPAA Consulting Group, Inc.
000 Xxxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
If to the Purchasers: Xx. Xxxx Xxxxx (Fax 000-000-0000)
(As Representative of the Purchasers)
000 Xxxx Xxxx
Xxxxxxx, XX, Xxxxxx X0X 0X0
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Any notice or communication given to the Xxxx Xxxxx, the "Representative of the
Purchasers", shall be deemed duly given to all Purchasers. Any party may send
any notice, request, demand, claim, or other communication hereunder to the
intended recipient at the address set forth above using any other means
(including personal delivery, messenger service, telecopy, telex, ordinary mail,
or electronic mail), but no such notice, request, demand, claim, or other
communication shall be deemed to have been duly given unless and until it
actually is received by the intended recipient. Any party may change the address
to which notices, requests, demands, claims, and other communications hereunder
are to be delivered by giving the other parties notice in the manner herein set
forth.
(h) This Agreement shall be governed by and construed in accordance with
the domestic laws of the state of Minnesota without giving effect to any choice
or conflict of law provision or rule (whether of the state of Minnesota or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the state of Minnesota.
(i) Amendments and Waivers. No amendment of any provision of this Agreement
shall be valid unless the same shall be in writing and signed by the parties
hereto. No waiver by any party of any default, misrepresentation, or breach of
warranty or covenant hereunder, whether intentional or not, shall be deemed to
extend to any prior or subsequent default, misrepresentation, or breach of
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence.
(j) Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity
or enforceability of the remaining terms and provisions hereof or the validity
or enforceability of the offending term or provision in any other situation or
in any other jurisdiction.
(k) Each of the parties will bear his or its own costs and expenses
(including legal fees and expenses) incurred in connection with this Agreement
and the transactions contemplated hereby.
(l) Construction. The parties have participated jointly in the negotiation
and drafting of this Agreement. In the event an ambiguity or question of intent
or interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated there under, unless the context requires otherwise. The
word "including" shall mean including without limitation. The parties intend
that each representation, warranty, and covenant contained herein shall have
independent significance.
(m) Incorporation of Exhibits. The Exhibits identified in this Agreement
are incorporated herein by reference and made a part hereof.
(n) Specific Performance. Each of the parties acknowledges and agrees that
the other party would be damaged irreparably in the event any of the provisions
of this Agreement are not
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performed in accordance with their specific terms or otherwise are breached.
Accordingly, each of the parties agrees that the other party shall be entitled
to an injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any action instituted in any court of the United States or
any state thereof having jurisdiction over the parties and the matter, in
addition to any other remedy to which it may be entitled, at law or in equity.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
TRANSFORM PACK INTERNATIONAL, INC.
By: /s/ Xxxx Xxxxx
PURCHASERS
Certificate Number(s) No. of Shares
/s/ Xxxx Xxxxx C01058 2,346,103
/s/ Xxxxxxxx Xxxxxxx C01054 55,300
/s/ Xxxxxx Xxxxx C01059 87,500
/s/ Xxxxxx Xxxxxx, Trustee T01036, T01037, T01038 4,511,097
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Exhibit A
RETAINED COMPANY LIABILITIES
(In US Dollars)
The total amount of liabilities owed to the persons listed below as of the
Effective Date, which at April 2003, were in the approximate amounts listed
below:
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Fidelity Transfer Company $ 1,108.16
--------------------------------------------------------------------------------
Deloitte & Touche LLP $ 20,257.67
--------------------------------------------------------------------------------
Cohne, Xxxxxxxxx & Xxxxx, PC $ 12,234.29
--------------------------------------------------------------------------------
Xx. Xxxxxx Xxxxxxx $ 70,703.64
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Exhibit B
ISSUE INTRUCTIONS FOR TPI STOCK
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Xxxx Xxxxx 780,752
--------------------------------------------------------------------------------
Xxxxx Xxxxxxxxxxx 578,124
--------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxxxxxxx 578,123
--------------------------------------------------------------------------------
Stromax 15,400
--------------------------------------------------------------------------------
Xxxx Xxxxxxxx 11,000
--------------------------------------------------------------------------------
Xxxxxx Xxxxx 22,427
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx 14,174
--------------------------------------------------------------------------------
Total 2,000,000
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Deliver the shares to:
Xx. Xxxx Xxxxx
(As Representative of the Purchasers)
000 Xxxx Xxxx
Xxxxxxx, XX, Xxxxxx X0X 0X0
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