EX-10.1
2
cncg_ex101.
htm
STOCK PURCHASE AGREEMENT
Exhibit 10.1
EXECUTION COPY
STOCK PURCHASE AGREEMENT
by and among
CONCIERGE TECHNOLOGIES, INC.
XXXXXXXXXX HOLDINGS, INC.
and
EACH OF THE INDIVIDUALS AND ENTITIES
EXECUTING SIGNATURE PAGES HERETO
DATED AS OF SEPTEMBER 19, 2016
TABLE
OF CONTENTS
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ARTICLE I
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DEFINITIONS
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1
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ARTICLE II
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PURCHASE AND SALE OF XXXXXXXXXX SHARES; CLOSING
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9
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2.1
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Purchase and Sale; Additional Sellers
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9
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2.2
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Purchase Price
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9
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2.3
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Closing
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10
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2.4
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Closing Obligations
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10
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ARTICLE III
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REPRESENTATIONS AND WARRANTIES OF SELLERS
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11
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3.1
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Organization; Good Standing
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11
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3.2
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Ownership
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12
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3.3
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Authorization
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12
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3.4
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Valid Transfer
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12
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3.5
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Investor Questionnaire; Investment Intent
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12
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3.6
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Compliance with Other Instruments
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12
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3.7
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Legal Proceedings
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12
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3.8
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Disclaimer of Warranties
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12
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ARTICLE IV
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REPRESENTATIONS AND WARRANTIES OF XXXXXXXXXX
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13
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4.1
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Organization and Good Standing
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13
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4.2
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Authority; No Conflict
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13
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4.3
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Capitalization
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14
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4.4
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Financial Statements
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14
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4.5
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Title to Properties; Liens
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15
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4.6
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Taxes
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15
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4.7
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Employee Benefits
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16
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4.8
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Compliance With Legal Requirements; Governmental
Authorizations
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17
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4.9
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Funds
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18
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4.1
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Legal Proceedings; Orders
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20
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4.11
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Absence of Certain Changes and Events
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20
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4.12
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Contracts; No Defaults
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21
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4.13
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Insurance
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23
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4.14
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Intellectual Property
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23
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4.15
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Relationships With Related Persons
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24
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4.16
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Brokers or Finders
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24
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4.17
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Books and Records
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24
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4.18
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Acknowledgement
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24
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4.19
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Disclaimer of Warranties
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24
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i
TABLE
OF CONTENTS
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ARTICLE V
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REPRESENTATIONS AND WARRANTIES OF CONCIERGE
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25
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5.1
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Organization and Good Standing
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25
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5.2
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Authority; No Conflict
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25
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5.3
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Capitalization
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26
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5.4
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SEC Reports; No Undisclosed Liabilities
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26
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5.5
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Title to Properties; Liens
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27
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5.6
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Taxes
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27
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5.7
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Employee Benefits
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28
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5.8
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Legal Proceedings; Orders
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29
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5.9
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Compliance With Legal Requirements; Governmental
Authorizations
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29
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5.1
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Absence of Certain Changes and Events
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30
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5.11
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Contracts; No Defaults
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31
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5.12
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Insurance
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32
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5.13
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Intellectual Property
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32
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5.14
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Ineligible Persons
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32
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5.15
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Investment Intent
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33
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5.16
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Brokers or Finders
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33
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5.17
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Independent Advisory Committee
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33
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5.18
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Acknowledgement
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33
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ARTICLE VI
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COVENANTS OF XXXXXXXXXX AND SELLERS
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33
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6.1
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Access and Investigation
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33
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6.2
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Operation of the Business of the Acquired Companies
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34
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6.3
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Negative Covenant
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34
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6.4
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Required Approvals
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34
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6.5
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Notification
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35
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6.6
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Payment of Indebtedness
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35
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6.7
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No Negotiation
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35
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6.8
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Commercially Reasonable Efforts
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35
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6.9
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Audit Fees
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35
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ARTICLE VII
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COVENANTS OF CONCIERGE
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36
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7.1
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Access and Investigation
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36
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7.2
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Operation of the Business of Concierge and its
Subsidiaries
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36
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7.3
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Negative Covenant
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36
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7.4
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Approvals of Governmental Bodies; Shareholders
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37
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7.5
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Notification
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37
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7.6
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Commercially Reasonable Efforts
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38
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7.7
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No Negotiation
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38
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ii
TABLE
OF CONTENTS
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ARTICLE VIII
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CONDITIONS PRECEDENT TO CONCIERGE’S OBLIGATION TO
CLOSE
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38
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8.1
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Accuracy of Representations
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38
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8.2
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Sellers’ and Xxxxxxxxxx’x Performance
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38
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8.3
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Concierge Shareholder Approval
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39
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8.4
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Consents
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39
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8.5
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No Proceedings
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39
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8.6
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Fairness Opinion
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39
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ARTICLE IX
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CONDITIONS PRECEDENT TO SELLERS’ and wainrwright’s
OBLIGATION TO CLOSE
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39
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9.1
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Accuracy of Representations
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39
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9.2
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Concierge’s Performance
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39
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9.3
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Concierge Shareholder Approval
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40
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9.4
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Consents
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40
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9.5
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No Proceedings
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40
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9.6
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Cogent Materials and Schedule 14C
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40
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ARTICLE X
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TERMINATION
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40
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10.1
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Termination Events
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40
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10.2
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Effect of Termination
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41
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ARTICLE XI
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INDEMNIFICATION; REMEDIES
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41
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11.1
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Survival
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41
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11.2
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Indemnification and Payment of Damages by Sellers
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41
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11.3
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Indemnification and Payment of Damages By Concierge
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41
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11.4
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Time Limitations
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42
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11.5
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Limitations on Amount – Sellers
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42
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11.6
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Limitation on Amount – Concierge
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42
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11.7
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Additional Limitations
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43
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11.8
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Exclusive Remedies
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43
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11.9
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Characterization of Payments
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43
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11.1
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Procedure for Indemnification – Third Party
Claims
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44
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11.11
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Procedure for Indemnification – Other Claims
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44
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ARTICLE XII
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GENERAL PROVISIONS
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44
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12.1
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Expenses
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44
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12.2
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Public Announcements
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45
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12.3
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Confidentiality
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45
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12.4
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Notices
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45
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12.5
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Jurisdiction; Service of Process
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46
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12.6
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Further Assurances
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46
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12.7
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Waiver
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46
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12.8
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Entire Agreement and Modification
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46
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12.9
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Disclosure Letters
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47
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12.1
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Assignments, Successors, and No Third-Party Rights
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47
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12.11
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Severability
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47
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12.12
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Section Headings; Construction
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47
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12.13
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Governing Law
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47
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12.14
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Counterparts
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47
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iii
STOCK
PURCHASE AGREEMENT
This
Stock Purchase Agreement (“Agreement”) is
made as of September 19, 2016 by (i) Concierge Technologies, Inc.,
a Nevada corporation (“Concierge”),
Xxxxxxxxxx Holdings, Inc., a Delaware corporation (“Xxxxxxxxxx”),
and each of the individuals and entities identified under the
heading “Sellers” on the signature pages hereto who, as
of the date hereof or subsequent to the date hereof pursuant to
Section 2.1(b) below, execute a counterpart signature page to this
Agreement (collectively, “Sellers”).
RECITALS
WHEREAS, the individuals and entities
identified under the heading “Sellers” on the signature
pages hereto (collectively, the “Xxxxxxxxxx
Shareholders”) collectively own 1,741 shares of common
stock, par value $0.01 per share, of Xxxxxxxxxx
(“Xxxxxxxxxx
Common Stock”), which shares represent all of the
issued and outstanding shares Xxxxxxxxxx Common Stock;
WHEREAS, Xxxxxxxxxx owns all of the
issued and outstanding limited liability company membership
interests of United States Commodity Funds LLC, a Delaware limited
liability company (“USCF”);
WHEREAS, USCF acts as the general
partner to the limited partnerships and as sponsor to the statutory
trusts set forth on Exhibit A hereto (each, a
“Fund”, and
collectively, the “Funds”);
WHEREAS, Concierge desires to purchase
from the Sellers, and the Sellers desires to sell and assign to
Concierge, all of the shares of Xxxxxxxxxx Common Stock held by
Sellers (collectively, the “Xxxxxxxxxx
Shares”) in exchange for the Concierge Shares (as
defined below);
WHEREAS, upon the sale and assignment of
the Xxxxxxxxxx Shares to Concierge, Concierge shall operate the
Business (as defined below);
WHEREAS, Concierge, Xxxxxxxxxx and
Sellers desire to reflect certain other understandings regarding
the transition of the Business (as defined below) from Sellers to
Concierge;
NOW, THEREFORE, in consideration of the
mutual representations, warranties, covenants and agreements
contained herein, the parties, intending to be legally bound,
hereby agree as follows:
ARTICLE
I
DEFINITIONS
For
purposes of this Agreement, the following terms have the meanings
specified or referred to in this Section 1:
“Acquired
Companies” means, collectively, Xxxxxxxxxx, USCF and
USCF Advisers.
1
“Acquired Company
Plan” means each material
“employee benefit plan,” as defined in Section 3(3) of
ERISA, 29 U.S.C. §1002(3) (without regard to whether ERISA
applies thereto), and each other material employee benefit or
compensation plan or arrangement, including any bonus, deferred
compensation, incentive compensation, severance, health and welfare
plan, sponsored or maintained solely by one or more of the Acquired
Companies.
“Affiliate”
means, with respect to a specified Person, any other Person
controlling, controlled by, or under common control with the
specified Person; provided,
however, that in no event shall any Fund be considered an
Affiliate of any Seller, any Acquired Company or, following the
Closing, Concierge.
“Agreement” has
the meaning set forth in the preamble of this
Agreement.
“Bankruptcy and Equity
Exception” has the meaning set forth in Section
3.3.
“Business”
means the business of USCF (in its capacity as the general partner
to or sponsor of the Funds) and USCF Advisers, in each case as
currently conducted.
“Business Day”
means any day other than (a) a Saturday or Sunday or (b) any day on
which the New York Stock Exchange is closed for
trading.
“Cap” has
the meaning set forth in Section 11.5.
“CFTC” means
the United States Commodity Futures Trading
Commission.
“Closing” has
the meaning set forth in Section 2.3.
“Closing Date”
means the date and time as of which the Closing actually takes
place.
“Cogent”
means Cogent Valuation, Inc.
“Concierge” has
the meaning set forth in the preamble of this
Agreement.
“Concierge Disclosure
Letter” means the disclosure letter delivered by
Concierge to Xxxxxxxxxx and Sellers concurrently with the execution
and delivery of this Agreement.
“Concierge
Plan” means each material
“employee benefit plan,” as defined in Section 3(3) of
ERISA, 29 U.S.C. §1002(3) (without regard to whether ERISA
applies thereto), and each other material employee benefit or
compensation plan or arrangement, including any bonus, deferred
compensation, incentive compensation, severance, health and welfare
plan, sponsored or maintained solely by Concierge and/or one or
more of its Subsidiaries.
“Concierge Common
Stock” means the
shares of common stock, par value $0.001 per share, of
Concierge.
“Concierge Indemnified
Parties” has the
meaning set forth in Section 11.2.
“Concierge Material Adverse
Effect” means any fact, circumstance, condition,
event, occurrence or change that, individually or in the aggregate,
has had or is reasonably likely to have a material adverse effect
on the financial condition, results of operations, assets or
Liabilities of Concierge and its Subsidiaries, taken as a whole,
but excluding, for these purposes, any fact, circumstance, event,
occurrence or change to the extent resulting from (a) changes in
general economic or political conditions; (b) conditions generally
affecting the industries in which Concierge and its Subsidiaries
operate, (c) any changes in financial or securities markets in
general, (d) the imposition of legal, regulatory, Tax or other
similar restrictions or requirements, (e) acts of war or
significant acts of terrorism; (f) actions taken or not taken at
the request of, or with the consent of, Xxxxxxxxxx, or (g) adverse
effects arising from the announcement or consummation of the
Contemplated Transactions.
2
“Concierge Per Share
Price” means $0.085
per share.
“Concierge Registered
Intellectual Property” means all worldwide patents and
patent applications, trademark registrations and copyright
registrations, and applications for trademark and copyright
registrations, in each case that are owned by Concierge or its
Subsidiaries.
“Concierge
Shares” has the meaning set forth in section
2.1(a).
“Confidentiality
Agreement” means the Mutual Nondisclosure Agreement
dated August 25, 2016, and entered into by and between Concierge
and Xxxxxxxxxx.
“Consent” means
any filing with, notice to, or approval, consent, ratification or
waiver from, any Person.
“Contemplated
Transactions” means the sale of the Xxxxxxxxxx Shares
by Sellers to Concierge; Concierge’s acquisition and
ownership of the Xxxxxxxxxx Shares; Concierge’s issuance of
the Concierge Common Stock to Sellers; and the performance by
Concierge, Xxxxxxxxxx and Sellers of their respective covenants and
obligations under this Agreement.
“Contract”
means any written agreement, contract, obligation, promise, or
undertaking that is legally binding.
“Current
Employee” has the meaning set forth in Section
4.7(b).
“Damages” has
the meaning set forth in Section 11.2(a).
“Data” means
all the available data in digital format that is used in the
operations and business of the Acquired Companies as currently
conducted.
“Deductible”
has the meaning set forth in Section 11.5.
“Definitive Information
Statement” has the meaning set forth in Section
7.4(b).
“ERISA” means
the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to that
Act or any successor law.
“Family” means,
with respect to an individual, the individual and the
individual’s (i) parents, (ii) spouse, (iii) children, and
(iv) siblings.
3
“FINRA” means
the Financial Industry Regulatory Authority, Inc. (including its
predecessor organizations).
“Fund” has the
meaning set forth in the Recitals to this Agreement.
“Fund Material Adverse
Effect” means any fact, circumstance, condition,
event, occurrence or change that, individually or in the aggregate,
has had or is reasonably likely to have a material adverse effect
on the financial condition, results of operations, business, assets
or liabilities of the Funds collectively, but excluding, for these
purposes, any fact, circumstance, event, occurrence or change to
the extent resulting from (a) changes in general economic or
political conditions; (b) conditions generally affecting the
industries in which the Funds invest, (c) any changes in financial
or securities markets in general, (d) a decline in the aggregate
net asset value of the Funds so long as the Funds have been managed
in all material respects in the ordinary course of business and
operated in all material respects in accordance with their stated
investment objectives, policies and restrictions; (e) the
imposition of legal, regulatory, Tax or other similar restrictions
or requirements, including position limits or similar restrictions
on the Funds by a Governmental Body, (f) acts of war or significant
acts of terrorism; or (g) actions taken or not taken at the request
of, or with the consent of, Concierge, or (h) adverse effects
arising from the announcement or consummation of the Contemplated
Transactions.
“Fund Material
Contracts” means all
currently effective agreements necessary for the operation of the
Funds substantially in the manner in which the Funds are currently
operated.
“Funds” has the
meaning set forth in the Recitals to this Agreement.
“GAAP” means
United States generally accepted accounting
principles.
“Governmental
Authorization” means any approval, consent, license,
permit, waiver, or other authorization issued, granted, given, or
otherwise made available by or under the authority of any
Governmental Body or pursuant to any Legal
Requirement.
“Governmental
Body” means any:
(a) nation, state,
county, city, town, village, district, or other jurisdiction of any
nature;
(b) federal, state,
local, municipal, foreign, or other government;
(c) governmental or
quasi-governmental authority of any nature (including any
governmental agency, branch, department, official, or entity and
any court or other tribunal);
(d) multi-national
organization or body;
(e) exchange or
clearing house; or
(f) body exercising, or
entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or Taxing Authority or power of
any nature.
4
“HSR Act” means
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 or any
successor law, and regulations and rules issued pursuant to that
Act or any successor law.
“Indemnification
Percentage” means, with respect to a Seller, the
percentage set forth in Exhibit B opposite such
Seller’s name under the column “Indemnification
Percentage,” which percentage share shall be used for
purposes of determining such Seller’s obligation to pay
indenifiation amounts under Section 11.2(b).
“Intellectual
Property” means the following: (a) copyrights,
registrations, works of authorship, expressions, designs and design
registrations, and applications for registration thereof, (b)
trademarks, service marks, trade names, slogans, domain names, web
addresses, web pages, websites and related content, logos, trade
dress, and registrations and applications for registrations
thereof, (c) patents and patent applications, (d) Software, and (e)
trade secrets and confidential and proprietary information,
including Data, ideas, designs, discoveries, concepts, compilations
of information, methods, techniques, procedures, processes and
other know-how, whether or not patentable.
“IRC” means the
Internal Revenue Code of 1986 or any successor law, and regulations
issued by the IRS pursuant to the Internal Revenue Code or any
successor law.
“IRS” means the
United States Internal Revenue Service or any successor agency,
and, to the extent relevant, the United States Department of the
Treasury.
“Knowledge”
means, with respect to any entity, as to a particular fact or other
matter, the actual knowledge of any member of the senior management
of such entity.
“Legal
Requirement” means any federal, state, local,
municipal, foreign, international, multinational, self-regulatory
organization, exchange, clearing house or other administrative law,
statute, regulation, constitution, ordinance, principle of common
law, or treaty.
“Liabilities”
means, with respect to a Person, any and all debts, liabilities or
obligations of such Person of any kind, character or description,
whether known or unknown, absolute or contingent, accrued or
unaccrued, disputed or undisputed, liquidated or unliquidated,
secured or unsecured, joint or several, due or to become due,
vested or unvested, executory, determined, determinable or
otherwise, and whether or not the same is required to be accrued on
the financial statements of such Person.
“Lien” means
any lien, charge, option, pledge, or security interest, in each
case excluding Permitted Liens.
“Material
Contracts” has the
meaning set forth in Section 4.12(a).
“NFA” means
the National Futures Association.
“Order” means
any award, decision, injunction, judgment, order, ruling, or
verdict entered, issued, made, or rendered by any Governmental
Body.
5
“Ordinary Course of
Business” means, with respect to a Person, an action
taken by such Person in the ordinary course of the normal
day-to-day operations of such Person, consistent with past
practice.
“Organizational
Documents” means (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the partnership
agreement and any statement of partnership of a general
partnership; (c) the limited partnership agreement and the
certificate of limited partnership of a limited partnership; (d)
the certificate of formation and limited liability company
operating agreement of a limited liability company, (e) any other
charter, trust documents, or similar document adopted or filed in
connection with the creation, formation, or organization of a
Person; (f) any stockholders agreement or similar arrangement among
security holders; and (g) any amendment to any of the
foregoing.
“Permitted
Liens” means Liens (a) for Taxes or other governmental
charges not yet due and payable; (b) carriers, warehousemen,
mechanics, laborers or other similar Liens created by statute and
incurred in the Ordinary Course of Business for sums not yet due;
(c) Liens involving restrictions on transfer arising under the
Organizational Documents of the issuer or securities or under
federal or state securities laws, or (d) community property or
other interests arising under applicable Legal
Requirements.
“Person” means
any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, or
other entity or Governmental Body.
“Preliminary Consent
Statement” has the meaning set forth in Section
7.4(b).
“Pro Rata
Share” means, with respect to a Seller, the percentage
set forth in Exhibit
B opposite such Seller’s name under the column
“Pro Rata Share,” which percentage share shall be used
for purposes of determining such Seller’s right to receive
any indemnification amount.
“Proceeding”
means any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative,
investigative, or informal) commenced, brought, conducted, or heard
by or before any Governmental Body or arbitrator.
“Purchase
Price” has the meaning set forth in Section
2.2(a).
“Regulatory
Documents” means (i) any monthly or annual reports and
any disclosure document required to be filed by or on behalf of any
Fund under applicable CFTC, FINRA, NFA, or other Governmental
Bodies’ rules and regulations, and (ii) any periodic reports
and any registration statements required to be filed by or on
behalf of any Fund with the SEC in accordance with applicable
federal securities laws.
“Related
Person” means (a) with respect to a particular
individual, (i) each other member of such individual’s
Family; (ii) any Person (excluding any natural Person) that is
directly or indirectly controlled by such individual or one or more
members of such individual’s Family; (iii) any Person
(excluding any natural Person) with respect to which such
individual or one or more members of such individual’s Family
serves as a director, officer, partner, executor, or trustee (or in
a similar capacity), and (b) with respect to a specified Person
other than an individual, (i) any Affiliate of such specified
Person; (ii) each Person that serves as a director, officer,
partner, executor, or trustee of such specified Person (or in a
similar capacity); and (iii) any Person with respect to which such
specified Person serves as a general partner or a trustee (or in a
similar capacity).
6
“Representative”
means with respect to a particular Person, any director, officer,
employee, agent, consultant, advisor, or other representative of
such Person, including legal counsel, accountants, and financial
advisors.
“SEC” means
the United States Securities and Exchange Commission.
“SEC Reports”
has the meaning set forth in Section 5.4(a).
“Securities
Act” means the Securities Act of 1933 or any successor
law, and regulations and rules issued pursuant to that Act or any
successor law.
“Seller Indemnified
Parties” has the meaning set forth in Section
11.3.
“Sellers” has
the meaning set forth in the preamble of this
Agreement.
“Series A Preferred
Stock” has the meaning set forth in Section
5.3.
“Series B Preferred
Stock” has the meaning set forth in Section
5.3.
“Shareholder
Approval” has the meaning set forth in Section
7.4(b).
“Software”
means any instruction or set of instructions that is used
(e.g., read, compiled,
processed or manipulated) by, in or on any equipment, including
application programming interfaces, source code and object code
versions of applications programs, operating system software,
software tools, computer software languages and utilities software;
in each case, in whatever form or media, including the tangible
media upon which they are recorded or printed, together with all
corrections, improvements, enhancements, modifications, updates and
releases thereof prior to the Closing.
“Subsidiary”
means with respect to any Person (the “Owner”), any
corporation or other Person of which securities or other interests
having the power to elect a majority of that corporation’s or
other Person’s board of directors or similar governing body,
or otherwise having the power to direct the business and policies
of that corporation or other Person (other than securities or other
interests having such power only upon the happening of a
contingency that has not occurred) are held by the Owner or one or
more of its Subsidiaries; when used without reference to a
particular Person, “Subsidiary” means a Subsidiary of
Xxxxxxxxxx.
“Tax” or
“Taxes” means
all federal, state, local or foreign net or gross income, gross
receipts, sales, use, ad valorem, value added, franchise,
withholding, payroll, employment, excise, property, alternative
minimum, environmental or other taxes, assessments, duties, fees,
levies or other governmental charges of any nature whatsoever,
whether disputed or not, together with any interest, penalties,
additions to tax or additional amounts with respect
thereto.
7
“Tax Return”
means any return, declaration or report relating to Taxes due, any
information return with respect to Taxes, or other similar report,
statement, declaration or document required to be filed under any
law, regulation or similar in respect of Taxes, any amendment to
any of the foregoing, any claim for refund of Taxes paid, and any
attachments, amendments or supplements to any of the
foregoing.
“Taxing
Authority” means any
governmental agency, board, bureau, body, department or authority
of any United States federal, state or local jurisdiction or any
foreign jurisdiction, having or purporting to exercise jurisdiction
with respect to any Tax.
“Third Party
Claim” has the meaning set forth in Section
11.10(a).
“Third Party Claim
Notice” has the
meaning set forth in Section 11.10(a).
“USCF” has
the meaning set forth in the Recitals of this
Agreement.
“USCF Advisers”
means USCF Advisers, LLC.
“Xxxxxxxxxx”
has the meaning set forth in the Recitals of this
Agreement.
“Xxxxxxxxxx Balance
Sheet” has the meaning set forth in Section
4.4(a).
“Xxxxxxxxxx Common
Stock” has the meaning set forth in the Recitals to
this Agreement.
“Xxxxxxxxxx Disclosure
Letter” means the disclosure letter delivered by
Xxxxxxxxxx to Concierge concurrently with the execution and
delivery of this Agreement.
“Xxxxxxxxxx Material Adverse
Effect” means any fact, circumstance, condition,
event, occurrence or change that, individually or in the aggregate,
has had or is reasonably likely to have a material adverse effect
on the financial condition, results of operations, assets or
Liabilities of the Acquired Companies, taken as a whole, but
excluding, for these purposes, any fact, circumstance, event,
occurrence or change to the extent resulting from (a) changes in
general economic or political conditions; (b) conditions generally
affecting the industries in which the Acquired Companies operate,
(c) any changes in financial or securities markets in general, (d)
a decline in the aggregate net asset value of the Funds, so long as
the Funds have been managed in all material respects in the
ordinary course of business and operated in all material respects
in accordance with their stated investment objectives, policies and
restrictions; (e) the imposition of legal, regulatory, Tax or other
similar restrictions or requirements, including position limits or
similar restrictions on the Funds by a Governmental Body, (f) acts
of war or significant acts of terrorism; (g) actions taken or not
taken at the request of, or with the consent of, the Concierge, or
(h) adverse effects arising from the announcement or consummation
of the Contemplated Transactions.
“Xxxxxxxxxx Registered
Intellectual Property” means all worldwide patents and
patent applications, trademark registrations and copyright
registrations, and applications for trademark and copyright
registrations, in each case that are owned by the Acquired
Companies.
“Xxxxxxxxxx
Shares” has the meaning set forth in the Recitals of
this Agreement.
8
ARTICLE
II
PURCHASE AND SALE
OF XXXXXXXXXX SHARES; CLOSING
2.1
Purchase and Sale;
Additional Sellers.
(a) Subject to the
terms and conditions of this Agreement, at the Closing, Sellers
will sell, assign, transfer, convey, and deliver the Xxxxxxxxxx
Shares to Concierge, and Concierge will purchase all of each
respective Sellers’ right, title, and interest in the
Xxxxxxxxxx Shares, free and clear of any Liens, in exchange for the
Purchase Price described in Section 2.2.
(b) The parties hereto
acknowledge and agree that, as of the date hereof, not all
Xxxxxxxxxx Shareholders have become a party to this Agreement and
therefore do not, as of the date hereof, constitute
“Sellers” under this Agreement (such Xxxxxxxxxx
Shareholders, the “Remaining Xxxxxxxxxx
Shareholders”). From and after the date hereof,
Concierge and Xxxxxxxxxx agree to use their respective commercially
reasonable efforts to discuss the terms of this Agreement with such
Remaining Xxxxxxxxxx Shareholders, to provide such Remaining
Xxxxxxxxxx Shareholders with such information regarding Concierge,
the Concierge Shares, Xxxxxxxxxx, this Agreement and the
Contemplated Transactions as may be reasonably necessary to permit
such Remaining Xxxxxxxxxx Shareholders to make an informed
investment decision regarding whether to become a party to this
Agreement, and shall afford such Additional Xxxxxxxxxx Shareholders
the opportunity to become a party to this Agreement and to sell the
shares of Xxxxxxxxxx Common Stock held by such Remaining Xxxxxxxxxx
Shareholders by executing a joinder to this Agreement. In the event
a Remaining Xxxxxxxxxx Shareholder determines, in its sole
discretion, to become a party to this Agreement by executing a
joinder to this Agreement, the effectiveness of such joinder shall
be conditioned upon such Remaining Xxxxxxxxxx Shareholder
completing an investor questionnaire provided by Concierge and the
receipt by such Remaining Xxxxxxxxxx Shareholder of such financial
and other information concerning Concierge, the Concierge Shares,
Xxxxxxxxxx and this Agreement and the Contemplated Transactions as
may be required to permit the issuance of Concierge Shares to occur
without registration under the Securities Act pursuant to an
exemption therefrom. Subject to the satisfaction of the foregoing,
upon the execution of a joinder to this Agreement by such Remaining
Xxxxxxxxxx Shareholder, (i) such Remaining Xxxxxxxxxx Shareholder
shall no longer be considered as such, and instead shall thereafter
constitute a “Seller” under this Agreement as if such
Remaining Xxxxxxxxxx Shareholder had been an original party to this
Agreement as of the date hereof, and (ii) the shares of Xxxxxxxxxx
Common Stock held by such Remaining Xxxxxxxxxx Shareholder shall
constitute “Xxxxxxxxxx Shares” for all purposes under
this Agreement.
2.2
Purchase
Price. The aggregate
purchase price for the Xxxxxxxxxx Shares, assuming that all
Xxxxxxxxxx Shareholders become Sellers (the “Purchase
Price”), will be (a) 818,799,976 shares of Concierge
Common Stock, and (b) 9,354,118.85 shares of Series B Preferred
Stock (the foregoing (a) and (b) referred to collectively as the
“Concierge
Shares”); provided, however, that no Seller shall be
entitled to receive a fraction of a Concierge Share.
9
2.3
Closing. The closing of the purchase and sale
provided for in this Agreement (the “Closing”) will
take place at Xxxxxxx + Xxxxxxxxx, a Professional Law Corporation,
00 Xxxxxxx, Xxxxx 000, Xxxx Xxxxxx, XX 00000 at 10:00 a.m. Pacific
Standard Time (or such other place as the parties may agree) on the
later of (i) the date that is two Business Days following the
termination of the date on which the last of the conditions to
Closing set forth in Articles VIII and IX have been satisfied or,
to the extent permitted by applicable Legal Requirements, waived by
the relevant party, (ii) the 21st calendar following
the date on which the Definitive Schedule 14C was mailed to the
Concierge Shareholders, and (iii) such other time and date as the
parties may agree. Subject to the provisions of Article X, failure
to consummate the purchase and sale provided for in this Agreement
on the date and time and at the place determined pursuant to this
Section 2.3 will not result in the termination of this Agreement
and will not relieve any party of any obligation under this
Agreement.
2.4
Closing
Obligations. At the
Closing:
(a) Sellers will
deliver to Concierge:
(i)
Certificates
representing the Xxxxxxxxxx Shares, free and clear of all Liens,
duly endorsed (or accompanied by duly executed stock powers or
other instruments of transfer duly executed in blank) with all
required stock transfer tax stamps affixed thereto for transfer to
Concierge;
(ii)
A certificate,
executed by each Seller, certifying that, with respect to such
Seller, the conditions in Section 8.1(a) have been
satisfied;
(iii)
Such other
documents or instruments as Concierge reasonably requests and are
reasonably necessary to consummate the transactions contemplated by
this Agreement.
(b) Xxxxxxxxxx will
deliver to Concierge:
(i)
A certificate,
executed by Xxxxxxxxxx, certifying that the conditions set forth in
Sections 8.1(b), 8.2(a) and 8.4 have been satisfied.
(ii)
A certificate
executed by Xxxxxxxxxx’x corporate Secretary (or equivalent
officer) certifying that attached thereto are true and complete
copies of all resolutions adopted by the Xxxxxxxxxx board of
directors authorizing the execution, delivery and performance of
this Agreement and the consummation of Contemplated Transactions,
and that all such resolutions are in full force and effect and are
all the resolutions adopted in connection with the Contemplated
Transactions.
(iii)
A certificate of
good standing (or its equivalent) for Xxxxxxxxxx and each of the
other Acquired Companies from the Secretary of State or similar
Governmental Body of the jurisdiction within which Xxxxxxxxxx and
the other Acquired Companies are organized.
(iv)
Such other
documents or instruments as Concierge reasonably requests and are
reasonably necessary to consummate the Contemplated
Transactions.
(c) Concierge will
deliver to Xxxxxxxxxx:
10
(i)
A certificate
executed by Concierge certifying that each of the conditions set
forth in Sections 9.1, 9.2(a), 9.3 and 9.4 have been
satisfied.
(ii)
A certificate of
the Concierge corporate Secretary (or equivalent officer)
certifying that attached thereto are true and complete copies of
all resolutions adopted by the Concierge board of directors
authorizing the execution, delivery and performance of this
Agreement and the consummation of the Contemplated Transactions,
and that all such resolutions are in full force and effect and are
all the resolutions adopted in connection with the Contemplated
Transactions.
(iii)
A certificate of
good standing (or its equivalent) for Concierge from the Secretary
of State of the State of Nevada.
(iv)
Such other
documents or instruments as Xxxxxxxxxx reasonably requests and are
reasonably necessary to consummate the Contemplated
Transactions.
(d) Concierge will
deliver to Sellers:
(i)
The number of
Concierge Shares set forth in Exhibit B opposite the relevant
Seller’s name under the column “Concierge
Shares.”
(ii)
A certificate
executed by Concierge certifying that each of the conditions set
forth in Sections 9.1, 9.2(a), 9.3 and 9.4 have been
satisfied.
(iii)
Such other
documents or instruments as Sellers reasonably request and are
reasonably necessary to consummate the Contemplated
Transactions.
ARTICLE
III
REPRESENTATIONS AND
WARRANTIES OF SELLERS
Each
Seller, severally and not jointly, hereby represents and warrants
to Concierge as follows:
3.1
Organization; Good
Standing. If such
Seller is a Person other than a natural person, such Seller has
been duly formed and is validly existing and in good standing under
the laws of the jurisdiction of its formation.
3.2
Ownership.
Seller has good title to, is the record holder of, and beneficially
owns the Xxxxxxxxxx Shares set forth opposite such Seller’s
name in Exhibit B,
free and clear of all Liens. Except as contemplated by this
Agreement: (i) Seller is not a party or subject to any agreement or
understanding relating to the acquisition, disposition or voting or
giving of written consents with respect to any Xxxxxxxxxx Shares;
and (ii) Seller has no obligation (contingent or otherwise) to
purchase or otherwise acquire any Xxxxxxxxxx Shares or any other
interest in the Acquired Companies.
11
3.3
Authorization.
Seller has full capacity (in the case of an individual) or all
requisite power and authority (in the case of an entity) to execute
and deliver this Agreement and to transfer and sell the Xxxxxxxxxx
Shares owned by such Seller as contemplated by this Agreement, and
to carry out the provisions of this Agreement. All action on the
part of Seller necessary for the authorization, execution and
delivery of this Agreement by Seller, and the performance of all
obligations of Seller hereunder has been taken. This Agreement has
been duly and validly executed and delivered by Seller and,
assuming this Agreement has been duly authorized, executed and
delivered by the other parties hereto, constitutes a valid and
legally binding obligation of Seller, enforceable against Seller in
accordance with its terms (except as may be limited by bankruptcy,
insolvency, fraudulent transfer, moratorium, reorganization or
similar Legal Requirements of general applicability relating to or
affecting the rights of creditors generally and subject to general
principles of equity (the “Bankruptcy and Equity
Exception”)). If Seller is a natural person and is
subject to community property laws, including a Seller who is a
natural person resident in the State of
California, such Seller has
provided Concierge with a duly executed consent of such
Seller’s spouse with respect to the transactions contemplated
by this Agreement in the form attached hereto as Exhibit C hereto.
3.4
Valid
Transfer. Upon
transfer to Concierge of the Xxxxxxxxxx Shares held by Seller in
accordance with the terms of this Agreement for the consideration
expressed herein, Seller will have transferred to Concierge good
title to the Xxxxxxxxxx Shares owned by such Seller free and clear
of all Liens.
3.5
Investor Questionnaire;
Investment Intent.
Seller has previously completed and delivered to Concierge the
investor questionnaire provided to Seller by Concierge. Seller is
acquiring the relevant Concierge Shares for his, her, or its own
account and not with a view to their distribution within the
meaning of Section 2(11) of the Securities Act. Seller acknowledges
that the Concierge Shares are restricted securities within the
meaning of Rule 144 under the Securities Act and may not be
transferred except in compliance with the Securities Act and any
other applicable securities or “blue sky”
laws.
3.6
Compliance with Other
Instruments. The
execution, delivery and performance by Seller of this Agreement
will not give rise to a right of any party to enjoin the
transactions contemplated hereunder pursuant to the terms of any
mortgage, indenture, contract, lease, agreement, instrument,
judgment, decree, order or writ to which Seller is a party, by
which Seller is bound or to which Seller or its assets are
subject.
3.7
Legal Proceedings.
There are no actions pending or, to Seller’s knowledge,
threatened against or by Seller or any Affiliate of Seller, that
challenges or seeks to prevent, enjoin, or otherwise delay the
transactions contemplated by this Agreement.
3.8
Disclaimer of
Warranties. EXCEPT
FOR THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
THIS ARTICLE III,
(a) SELLER DISCLAIMS
ALL REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND
NO SUCH REPRESENTATION OR WARRANTY SHALL BE IMPLIED BY OR CONSTRUED
FROM ANY OF THE DUE DILIGENCE MATERIALS OR ANY OTHER INFORMATION,
WHETHER ORAL OR WRITTEN, PROVIDED BY OR ON BEHALF OF SELLER,
XXXXXXXXXX OR ITS AFFILIATES.
12
(b) NO REPRESENTATION
OR WARRANTY IS MADE BY SELLER AS TO THE CONDITION, MERCHANTABILITY
OR FITNESS FOR ANY PURPOSE OF ANY PROPERTIES OR ASSETS OF THE
ACQUIRED COMPANIES, ALL OF WHICH ARE FOR THE PURPOSES OF THIS
AGREEMENT CONSIDERED TO BE IN “AS-IS, WHERE-IS”
CONDITION.
ARTICLE
IV
REPRESENTATIONS AND
WARRANTIES OF XXXXXXXXXX
Xxxxxxxxxx hereby
represents and warrants to Concierge as follows:
4.1
Organization and Good
Standing.
(a) Each of the
Acquired Companies is duly organized, validly existing, and in good
standing under the laws of its jurisdiction of organization, with
full corporate or limited liability company, as applicable, power
and full corporate or limited liability company, as applicable,
authority to conduct its business as it is now being conducted, to
own or use the properties and assets that it purports to own or
use, and to perform all its obligations under Contracts to which it
is a party. Each of the Acquired Companies is duly qualified to do
business as a foreign corporation or a foreign limited liability
company and is in good standing under the laws of each state or
other jurisdiction in which either the ownership or use of the
properties owned or used by it, or the nature of the activities
conducted by it, requires such qualification except where the
failure to be so qualified or in good standing would not,
individually or in the aggregate, have a Xxxxxxxxxx Material
Adverse Effect.
(b) Xxxxxxxxxx has
delivered to Concierge copies of the Organizational Documents of
each of the Acquired Companies, as currently in
effect.
4.2
Authority; No Conflict.
(a) Xxxxxxxxxx has the
absolute and unrestricted right, power, and authority to execute
and deliver this Agreement and to perform its obligations
hereunder. The execution and delivery of this Agreement, and the
consummation of the Contemplated Transactions, have been duly
authorized by all requisite corporate action on the part of
Xxxxxxxxxx, and, assuming that this Agreement has been duly
authorized, executed and delivered by the other parties hereto,
constitutes the legal, valid, and binding obligation of Xxxxxxxxxx,
enforceable against it in accordance with its terms, except as may
be limited by the Bankruptcy and Equity Exception.
(b) Except as set forth
in Part 4.2 of the Xxxxxxxxxx Disclosure Letter, and assuming
the Consents referred to in Section 4.2(c) below are made or
obtained, as applicable, neither the execution and delivery of this
Agreement by Xxxxxxxxxx nor the consummation or performance of any
of the Contemplated Transactions will, directly or indirectly (with
or without notice or lapse of time or both):
13
(i)
contravene,
conflict with, or result in a violation of any provision of the
Organizational Documents of the Acquired Companies;
(ii)
contravene,
conflict with, or result in a violation of, or give any
Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any
relief under, any Legal Requirement or any Order to which any of
the Acquired Companies, or any of the assets owned or used by any
of the Acquired Companies, may be subject; or
(iii)
contravene,
conflict with, or result in a violation or breach of any provision
of, or give any Person the right to declare a default or exercise
any remedy under, or to accelerate the maturity or performance of,
or to cancel, terminate, or modify, any Material
Contract.
(c) Except as set forth
in Part 4.2 of the Xxxxxxxxxx Disclosure Letter, none of the
Acquired Companies is or will be required to give any notice to or
obtain any Consent from any Governmental Body, or any Person under
a Material Contract or a Fund Material Contract, in connection with
the execution and delivery of this Agreement or the consummation or
performance of any of the Contemplated Transactions.
4.3
Capitalization.
The authorized equity securities of Xxxxxxxxxx consist of 3,000
shares of Common Stock. As of the date hereof, 1,741 shares are
issued and outstanding and constitute the Xxxxxxxxxx Shares.
Xxxxxxxxxx owns, directly or indirectly, all of the ownership
interests of all its Subsidiaries, free and clear of all Liens. All
of the outstanding equity securities of each of the Acquired
Companies have been duly authorized and validly issued and are
fully paid and nonassessable. There are no outstanding or
authorized options, warrants, convertible securities or other
rights, arrangements or commitments, or Contracts of any kind to
which any of the Acquired Companies is a party relating to the
issuance, sale, or transfer of any equity securities or other
securities by any of the Acquired Companies. Except as set forth in
Part 4.3 of the Xxxxxxxxxx Disclosure Letter, none of the Acquired
Companies (other than Xxxxxxxxxx, as it relates to the other
Acquired Companies, and USCF, as it relates to its general
partnership interest in the Funds) owns, or has any Contract to
acquire, any equity securities or other securities of any Person or
any direct or indirect equity or ownership interest in any other
business.
4.4
Financial
Statements.
Xxxxxxxxxx has delivered to Concierge: (i) an audited
consolidated balance sheet of Xxxxxxxxxx as at December 31, in each
of the years 2014 and 2015, and the related audited consolidated
statements of income, changes in stockholders’ equity, and
cash flow for each of the fiscal years then ended, and (ii) an
unaudited consolidated balance sheet of Xxxxxxxxxx as at June 30,
2016 (including the notes thereto, the “Xxxxxxxxxx Balance
Sheet”), and the related consolidated statements of
income, changes in stockholders’ equity, and cash flow for
the six-month period then ended, together with the report of Xxxx
Xxxxxx Xxxxx, Inc. Such financial statements and notes fairly
present the financial condition and the results of operations,
changes in stockholders’ equity, and cash flow of Xxxxxxxxxx
as at the respective dates of and for the periods referred to in
such financial statements subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.
Xxxxxxxxxx has no material liabilities or obligations, contingent
or otherwise, other than (i) liabilities incurred in the ordinary
course of business subsequent to the date of the Xxxxxxxxxx Balance
Sheet; (ii) obligations under contracts and commitments incurred in
the ordinary course of business subsequent to the date of the
Xxxxxxxxxx Balance Sheet; and (iii) liabilities and obligations of
a type or nature not required under GAAP to be reflected in the
Xxxxxxxxxx Balance Sheet, which, in all such cases, individually
and in the aggregate would not be material.
14
4.5
Title to Properties;
Liens. None of the
Acquired Companies own any real property. Part 4.5 of the Xxxxxxxxxx
Disclosure Letter contains a complete and accurate list of all
leaseholds or other interests in real property owned by any
Acquired Company. The Acquired Companies own all the properties and
assets (whether real, personal, or mixed and whether tangible or
intangible) reflected as owned by them in the books and records of
the Acquired Companies, including all of the properties and assets
reflected in the Xxxxxxxxxx financial statements (except for assets
held under capitalized leases disclosed or not required to be
disclosed in Part 4.5 of the Xxxxxxxxxx Disclosure Letter and
personal property sold since the date of the Xxxxxxxxxx Balance
Sheet in the Ordinary Course of Business). All material properties
and assets reflected in the Xxxxxxxxxx financial statements are
free and clear of all Liens.
4.6
Taxes.
(a) Except as set forth
in Part 4.6(a) of the Xxxxxxxxxx Disclosure Letter, (i) the
Acquired Companies have filed or caused to be filed on a timely
basis all Tax Returns that are or were required to be filed by or
with respect to any of them since January 1, 2010, either
separately or as a member of a group of corporations, pursuant to
applicable Legal Requirements; (ii) all such Tax Returns were
correct and complete in all material respects; (iii) Xxxxxxxxxx has
delivered or made available to Concierge copies of all such Tax
Returns relating to income Taxes filed since January 1, 2010; and
(iv) the Acquired Companies have paid, or made provisions for the
payment of, all Taxes that have or may have become due pursuant to
those Tax Returns, or pursuant to any assessment received by
Xxxxxxxxxx or any Acquired Company, except such Taxes, if any, as
are being contested in good faith and as to which adequate reserves
(determined in accordance with GAAP) have been provided in the
Xxxxxxxxxx financial statements.
(b) Part 4.6(b) of the
Xxxxxxxxxx Disclosure Letter contains (i) a complete and accurate
list of all Tax Returns filed since January 1, 2010, and (ii) all
Taxes contested in good faith.
(c) Except as set forth
in Part 4.6(c) of the Xxxxxxxxxx Disclosure Letter, the United
States federal and state income Tax Returns of each of the Acquired
Companies have been audited by the IRS or relevant state tax
authorities or are closed by the applicable statute of limitations.
Except as described in Part 4.6(c) of the Xxxxxxxxxx
Disclosure Letter, none of Xxxxxxxxxx nor any of the Acquired
Companies has given or been requested to give waivers or extensions
(or is or would be subject to a waiver or extension given by any
other Person) of any statute of limitations relating to the payment
of Taxes of any of the Acquired Companies or for which any of the
Acquired Companies may be liable.
(d) The charges,
accruals, and reserves with respect to Taxes on the respective
books of each of the Acquired Companies are adequate (determined in
accordance with GAAP) and are at least equal to each Acquired
Companies liability for Taxes with respect to periods ending on or
prior to the date hereof. There exists no proposed Tax assessment
against any of the Acquired Companies except as disclosed in the
Xxxxxxxxxx financial statements or in Part 4.6 of the
Xxxxxxxxxx Disclosure Letter. All Taxes that any of the Acquired
Companies is or was required by Legal Requirements to withhold or
collect have been duly withheld or collected and, to the extent
required, have been paid to the proper Governmental Body or other
Person.
15
(e) There is no Tax
sharing or similar agreement that will require any payment by any
of the Acquired Companies to any other Person after the date of
this Agreement.
4.7
Employee
Benefits.
(a) Part 4.7(a) of the
Xxxxxxxxxx Disclosure Letter includes a list, as of the date
hereof, of all Acquired Company Plans and other Affiliate plans
that cover employees of the Acquired Companies. With respect to
each Acquired Company Plan, Xxxxxxxxxx has made available to
Concierge:
(i)
the current plan
document and any amendments thereto;
(ii)
the most recent
summary plan description and any subsequent summaries of material
modifications, if required under ERISA or other Legal
Requirement;
(iii)
any trust agreement
or annuity contract establishing the funding vehicle for the
Acquired Company Plan; and
(iv)
the most recent
annual report on Form 5500 filed for each Acquired Company
Plan.
(b) Xxxxxxxxxx has made
available to Concierge a list, as of a date no more than 30 days
before the date hereof, of all employees of the Acquired Companies
including those employees who are on medical, disability or other
approved leave (the “Current
Employees”) together with the following information
for each: employer; name; and job title.
(c) Except as would not
reasonably be expected to have, individually or in the aggregate, a
Xxxxxxxxxx Material Adverse Effect:
(i)
Each Acquired
Company Plan complies, in form and operation, with its terms and
all Legal Requirements, including ERISA and the IRC, in all
material respects.
(ii)
Each Acquired
Company Plan that is intended to be “qualified” under
Section 401(a) of the IRC has received a favorable determination
letter from the Internal Revenue Service.
(iii)
There are no
actions, suits, proceedings, hearings or, to Xxxxxxxxxx’x
Knowledge, investigations or threatened claims against or with
respect to any Acquired Company Plan (other than claims for
benefits in the ordinary course of plan operations).
(d) Neither the
Acquired Companies or any Affiliate of the Acquired Companies has
in the last three years contributed or been obligated to contribute
to any “Employee Pension Plan” as defined in Section
3(2) of ERISA, that is subject to Title IV of ERISA or Section 412
of the Code.
16
(e) None of the
Acquired Company Plans provide for post-employment life or health
insurance, benefits or coverage for any participant or any
beneficiary of a participant, except as may be required under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”) and at the expense of the participant or the
participant’s beneficiary.
(f) With respect to
each Acquired Company Plan, any contributions required of each of
the Acquired Companies have been timely and properly
made.
(g) The Acquired
Companies are in compliance in all material respects with all
applicable laws and regulations related to employment
nondiscrimination, wages, collective bargaining, civil rights, and
the collection and payment of withholding and/or social security
taxes.
4.8
Compliance With Legal
Requirements; Governmental Authorizations.
(a) Except as set forth
in Part 4.8 of the Xxxxxxxxxx Disclosure Letter or as would not,
individually or in the aggregate, have a Xxxxxxxxxx Material
Adverse Effect:
(i)
Each of the
Acquired Companies is, and at all times since January 1, 2012 has
been, in compliance in all material respects with each Legal
Requirement that is or was applicable to it or to the conduct or
operation of its business or the ownership or use of any of its
assets;
(ii)
None of the
Acquired Companies has received, at any time since January 1, 2012,
any notice or other communication (whether oral or written) from
any Governmental Body or any other Person regarding (A) any actual,
alleged, possible, or potential material violation of, or material
failure to comply with, any Legal Requirement, or (B) any actual,
alleged, possible, or potential obligation on the part of any of
the Acquired Companies to undertake, or to bear all or any portion
of the cost of, any material remedial action of any
nature.
(b) Part 4.8 of the
Xxxxxxxxxx Disclosure Letter contains a complete and accurate list
of each Governmental Authorization that is held by any of the
Acquired Companies and necessary to conduct the Business as
currently conducted. Each Governmental Authorization listed in Part
4.8 of the Xxxxxxxxxx Disclosure Letter is valid and in full force
and effect. Except as set forth in Part 4.8 of the Xxxxxxxxxx
Disclosure Letter:
(i)
Each of the
Acquired Companies is, and at all times since January 1, 2012 has
been, in compliance in all material respects with all of the terms
and requirements of each Governmental Authorization identified in
Part 4.8 of the Xxxxxxxxxx Disclosure Letter; and
(ii)
None of the
Acquired Companies has received, at any time since January 1, 2012,
any notice or other communication (whether oral or written) from
any Governmental Body or any other Person regarding (A) any actual,
alleged, possible, or potential material violation of or material
failure to comply with any term or requirement of any Governmental
Authorization, or (B) any actual, proposed, possible, or potential
revocation, withdrawal, suspension, cancellation, termination of,
or modification to any Governmental Authorization; and
17
(iii)
Since January 1,
2012, all applications required to have been filed for the renewal
of the Governmental Authorizations listed in Part 4.8 of the
Xxxxxxxxxx Disclosure Letter have been duly filed on a timely basis
with the appropriate Governmental Bodies, except as would not
result in a modification, suspension or termination of such
Governmental Authorization.
The
Governmental Authorizations listed in Part 4.8 of the Xxxxxxxxxx
Disclosure Letter collectively constitute all of the Governmental
Authorizations necessary to permit the Acquired Companies to
lawfully conduct and operate the Business substantially in the
manner they currently conduct and operate the Business and to
permit the Acquired Companies to own and use their assets
substantially in the manner in which they currently own and use
such assets, except where the failure to have such Government
Authorizations would not, individually or in the aggregate, have a
Xxxxxxxxxx Material Adverse Effect.
(c) Except as would
not, individually or in the aggregate, have a Xxxxxxxxxx Material
Adverse Effect, since January 1, 2012, (i) the Acquired Companies
have timely made all material filings of Regulatory Documents and
have paid all fees and assessments due and payable in connection
therewith, and (ii) as of their respective dates, such Regulatory
Documents of the Acquired Companies referenced in the foregoing
(c)(i) complied in all material respects with all applicable Legal
Requirements. Xxxxxxxxxx has previously delivered or made available
to Concierge a true, correct and complete copy of each Regulatory
Document filed by the Acquired Companies since January 1, 2012, and
will deliver to Concierge promptly after the filing thereof a true,
correct and complete copy of each Regulatory Document filed by any
of the Acquired Companies after the date hereof and prior to the
Closing Date.
4.9
Funds. Except as set forth in Part 4.9 of the
Xxxxxxxxxx Disclosure Letter:
(a) USCF is the general
partner to or sponsor of each of the Funds. No Person other than
USCF provides investment advisory or sub-advisory services to the
Funds.
(b) Each Fund is duly
organized, validly existing and, with respect to entities in
jurisdictions that recognize the concept of “good
standing,” in good standing under the laws of the
jurisdiction of its organization and has the requisite trust or
limited partnership power and authority to own its properties and
to carry on its business as currently conducted, and is qualified
to do business in each jurisdiction where it is required to be so
qualified under applicable Legal Requirements, except where failure
to do so would not, individually or in the aggregate, have a Fund
Material Adverse Effect. Xxxxxxxxxx has provided or made available
to Concierge true and correct copies of the Organizational
Documents of each Fund, all as in effect on the date
hereof.
(c) Except as would
not, individually or in the aggregate, have a Fund Material Adverse
Effect, each Fund is operated in compliance in all material
respects with (i) applicable Legal Requirements and the terms and
conditions of Governmental Authorizations, and (ii) its respective
investment objectives, policies and restrictions, as set forth in
the applicable prospectus, and registration statement for such
Fund.
18
(d) The shares or units
of each Fund have been issued and sold in material compliance with
applicable Legal Requirements.
(e) Except as would
not, individually or in the aggregate, have a Fund Material Adverse
Effect, since January 1, 2012, (i) each Fund has filed all material
Regulatory Documents required by applicable Legal Requirements to
be filed, (ii) each Regulatory Document referred to in the
foregoing (e)(i) complied in all material respects as to applicable
form requirements, and (iii) the Regulatory Documents referred to
in the foregoing (e)(i) did not at the time they were filed contain
any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary, in order to make
the statements therein, in the light of the circumstances under
which they were or are made, not misleading.
(f) The audited and
unaudited financial statements of each Fund reflected in the annual
report on Form 10-K for the fiscal year ended December 31, 2014 and
2015, respectively, and quarterly reports on Form 10-Q (correct and
complete copies of which have been made available to Concierge) for
the quarterly periods ended March 31 and June 30, 2016, have been
prepared in accordance with GAAP, consistently applied (except as
otherwise disclosed therein) and fairly present in all material
respects the financial position, statement of changes in net assets
and results of operations of such Fund at the dates and for the
periods stated therein (subject, in the case of interim financial
statements, to normal recurring year-end adjustments and the
absence of notes). Each Fund has established and maintains
disclosure controls and procedures and internal controls over
financial reporting that meet the requirements of the applicable
Legal Requirements in all material respects. There have been no
significant deficiencies or material weaknesses in the design or
operation of internal controls over financial reporting that have
adversely affected or would reasonably be expected to adversely
affect any Fund’s ability to record, process, summarize and
report financial information since the principal executive officer
and principal financial officer of such Fund have been required to
certify that any such deficiencies or weaknesses have been
disclosed to the Fund’s auditors and audit
committee.
(g) All Fund Material
Contracts are listed in Part 4.9(g) of the Xxxxxxxxxx Disclosure
Letter. Xxxxxxxxxx has delivered or made available to Concierge
true, complete and correct copies of all Fund Material Contracts,
codes of ethics, compliance policies and procedures and all
relevant certifications, reports and other documents evidencing
compliance or failures of compliance. With respect to the Fund
Material Contracts:
(i)
each is in full
force and effect and enforceable in accordance with its terms
(subject to the effect Bankruptcy and Equity
Exception);
(ii)
USCF and each Fund
is in material compliance with all applicable terms and
requirements of the Fund Material Contracts to which it is a
party;
19
(iii)
to
Xxxxxxxxxx’x Knowledge, each other Person that has any
obligation or liability under any Fund Material Contract is in
material compliance with all applicable terms and requirements of
such agreement; and
(iv)
to
Xxxxxxxxxx’x Knowledge, no event has occurred or circumstance
exists that (with or without notice or lapse of time or both) will
contravene, conflict with, or result in a material violation or
material breach by any Seller or Fund of any Fund Material
Contract.
4.10
Legal Proceedings;
Orders.
(a) Except as set forth
in Part 4.10 of the Xxxxxxxxxx Disclosure Letter, there is no
pending Proceeding that: (i) has been commenced by or against any
of the Acquired Companies or that otherwise relates to or is
reasonably likely to adversely affect the Business; or (ii)
challenges, or that may have the effect of preventing, delaying,
making illegal, or otherwise interfering with, any of the
Contemplated Transactions. To Xxxxxxxxxx’x Knowledge, (1)
except as would not, individually or in the aggregate, have a
Xxxxxxxxxx Material Adverse Effect, no such Proceeding has been
threatened, and (2) no event has occurred or circumstance exists
that is reasonably likely to give rise to or serve as a basis for
the commencement of any such Proceeding.
(b) Except as set forth
in Part 4.10 of the Xxxxxxxxxx Disclosure Letter: (i) there is no
Order to which any of the Acquired Companies, or any of the assets
owned or used by any of the Acquired Companies, is subject; and
(ii) to Xxxxxxxxxx’x Knowledge, no officer, director, agent,
or employee of any of the Acquired Companies is subject to any
Order that prohibits such officer, director, agent, or employee
from engaging in or continuing any conduct, activity, or practice
relating to the Business.
(c) Except as set forth
in Part 4.10 of the Xxxxxxxxxx Disclosure Letter: (i) each of the
Acquired Companies is, and at all times since January 1, 2012 has
been, in compliance in all material respects with all of the terms
and requirements of each Order to which it is or has been subject;
and (ii) none of the Acquired Companies has received, at any time
since January 1, 2012, any written notice from any Governmental
Body or any other Person regarding any actual, alleged, possible,
or potential material violation of, or material failure to comply
with, any term or requirement of any Order to which any of the
Acquired Companies is or has been subject.
4.11
Absence of Certain Changes
and Events. Except as
set forth in Part 4.11 of the Xxxxxxxxxx Disclosure Letter, since
the date of Xxxxxxxxxx Balance Sheet, the Acquired Companies have
conducted the Business only in the Ordinary Course of Business and
there has not been any:
(a) change in any of
the Acquired Companies authorized or issued capital stock or other
equity securities; grant of any stock option or right to purchase
shares of capital stock or other equity securities of any of the
Acquired Companies; issuance of any security convertible into such
capital stock or other equity securities; grant of any registration
rights; purchase, redemption, retirement, or other acquisition by
any of the Acquired Companies of any shares of any such capital
stock or other equity securities; or, except in the Ordinary Course
of Business, declaration or payment of any dividend or other
distribution or payment in respect of shares of capital stock or
other equity securities;
20
(b) amendment to the
Organizational Documents of any of the Acquired
Companies;
(c) except in the
Ordinary Course of Business, payment or increase by any of the
Acquired Companies of any bonuses, salaries, or other compensation
to any stockholder, director, officer, or employee or entry into
any employment, severance, or similar Contract with any director,
officer, or employee;
(d) adoption of, or
(except in the Ordinary Course of Business) increase in the
payments to or benefits under, any profit sharing, bonus, deferred
compensation, savings, insurance, pension, retirement, or other
employee benefit plan for or with any employees of any of the
Acquired Companies;
(e) sale (other than
sales of inventory in the Ordinary Course of Business), lease, or
other disposition of any asset or property of any of the Acquired
Companies or mortgage, pledge, or imposition of any Lien on any
material asset or property of any of the Acquired
Companies;
(f) cancellation or
waiver of any claims or rights with a value to any of the Acquired
Companies in excess of $250,000;
(g) material change in
the accounting methods used by any of the Acquired
Companies;
(h) transfer,
assignment, or grant of any license or sublicense of any material
rights under or with respect to any Intellectual Property of the
Acquired Companies;
(i) material damage,
destruction, or loss to any property owned or leased by any of the
Acquired Companies;
(j) entry into a new
line of business or abandonment or discontinuance of an existing
line of business; or
(k) agreement, whether
oral or written, by any of the Acquired Companies to do any of the
foregoing.
4.12
Contracts; No
Defaults.
(a) Part 4.12(a) of the
Xxxxxxxxxx Disclosure Letter contains a complete and accurate list,
and Xxxxxxxxxx has delivered to Concierge true and complete copies,
of the following Contracts to which any of the Acquired Companies
is a party or by which the assets of any of the Acquired Companies
are bound (other than Fund Material Contracts, which are addressed
in Section 4.9) (collectively, the “Material
Contracts”):
(i)
each Contract that
involves performance of services by one or more Acquired Companies
of an amount or value in excess of $250,000;
(ii)
each Contract that
involves performance of services for to one or more Acquired
Companies of an amount or value in excess of $250,000;
21
(iii)
each Contract that
was not entered into in the Ordinary Course of Business and that
involves expenditures or receipts of one or more Acquired Companies
in excess of $250,000;
(iv)
each lease, rental
or occupancy agreement, license, installment and conditional sale
agreement, and other Contract affecting the ownership of, leasing
of, title to, use of, or any leasehold or other interest in, any
real or personal property (except personal property leases and
installment and conditional sales agreements having a value per
item or aggregate payments of less than $250,000 and with terms of
less than one year);
(v)
each licensing
agreement or other Contract, in each case to the extent material to
the Acquired Companies, taken as a whole, with respect to
Intellectual Property;
(vi)
each collective
bargaining agreement and other Contract to or with any labor union
or other employee representative of a group of
employees;
(vii)
each joint venture,
partnership, and other Contract (however named) involving a sharing
of profits, losses, costs, or liabilities by any of the Acquired
Companies with any other Person;
(viii)
each Contract
containing covenants that in any way purport to restrict the
business activity of any of the Acquired Companies or limit the
freedom of any of the Acquired Companies to engage in any line of
business or to compete with any Person;
(ix)
each Contract for
capital expenditures in excess of $250,000;
(x)
each Contract that
provides for the indemnification by any of the Acquired Companies
of any Person or the assumption of any Tax, environmental or other
liability of any Person;
(xi)
each Contract with
any Governmental Body to which any of the Acquired Companies is a
party;
(xii)
each
Contract that limits or
purports to limit the ability of any of the Acquired Companies to
compete in any line of business or with any Person or in any
geographic area or during any period of time; and
(xiii)
each amendment,
supplement, and modification (whether oral or written) in respect
of any of the foregoing.
(b) Except as set forth
in Part 4.12(b) of the Xxxxxxxxxx Disclosure Letter, no Seller or
Related Person of any Seller) has or may acquire any rights under,
and no Seller has or may become subject to any obligation or
liability under, any Material Contract.
(c) Except as set forth
in Part 4.12(c) of the Xxxxxxxxxx Disclosure Letter, each Material
Contract is in full force and effect and is valid and enforceable
in accordance with its terms, except as may be limited by the
Bankruptcy and Equity Exception. None of the Acquired Companies is
in breach of or default under, or has provided or received any
notice of any intention to terminate any Material
Contract.
22
(d) Except as set forth
in Part 4.12(d) of the Xxxxxxxxxx Disclosure Letter:
(i)
each of the
Acquired Companies is, and at all times since January 1, 2015 has
been, in compliance in all material respects with all applicable
terms and requirements of each Material Contract;
(ii)
to
Xxxxxxxxxx’x Knowledge, each other Person that is a party to
any Material Contract is, and at all times since January 1, 2015
has been, in compliance in all material respects with all
applicable terms and requirements of such Material Contract;
and
(iii)
to
Xxxxxxxxxx’x Knowledge, no event has occurred or circumstance
exists that (with or without notice or lapse of time) may
contravene, conflict with, or result in a violation or breach of,
or give any of the Acquired Companies or other Person the right to
declare a default or exercise any remedy under, or to accelerate
the maturity or performance of, or to cancel, terminate, or modify,
any Material Contract.
4.13
Insurance.
Except as set forth on Part 4.13 of the Xxxxxxxxxx Disclosure
Letter: (i) the insurance policies to which any of the Acquired
Companies is a party or that provide coverage to any of the
Acquired Companies, or any director or officer of any of the
Acquired Companies with respect to the Business, taken together,
provide adequate insurance coverage for the assets and the
operations of the Acquired Companies for all risks normally insured
against by a Person carrying on the same business or businesses as
the Acquired Companies; (ii) the Acquired Companies have paid all
premiums due, and have otherwise performed all of their respective
obligations, under each policy to which any of the Acquired
Companies is a party or that provides coverage to any of the
Acquired Companies or any officer or director thereof; and (iii)
the Acquired Companies have given notice to the insurer of all
claims of which it is aware that may be insured
thereby.
4.14
Intellectual
Property.
(a) Except as set forth
on Part 4.14 of the Xxxxxxxxxx Disclosure Letter, each of the
Acquired Companies owns, or has a valid and subsisting license or
right to use, all Intellectual Property used in, and material to,
the Business as currently conducted.
(b) Part 4.14 of the
Xxxxxxxxxx Disclosure Letter sets forth a complete and accurate
list of all Xxxxxxxxxx Registered Intellectual Property. Except as
set forth in Part 4.14 of the Xxxxxxxxxx Disclosure Letter (i) one
of the Acquired Companies has title to each item of the Xxxxxxxxxx
Registered Intellectual Property, free and clear of any Lien, (ii)
no third party has asserted against any of the Acquired Companies a
claim that any of the Acquired Companies is infringing the
Intellectual Property of such third party, (iii) to
Xxxxxxxxxx’x Knowledge, no basis for any such claim exists,
(iv) to Xxxxxxxxxx’x Knowledge, none of the Intellectual
Property used in the conduct of the Business infringes upon or
otherwise violates the Intellectual Property rights of others, (v)
none of the Xxxxxxxxxx Registered Intellectual Property is subject
to any outstanding order, decree or judgment of any Governmental
Body, and (vi) to Xxxxxxxxxx’x Knowledge, no third party is
infringing the Intellectual Property owned by any of the Acquired
Companies. All required fees to register and maintain the
Xxxxxxxxxx Registered Intellectual Property that are due have been
paid and, to Xxxxxxxxxx’x Knowledge, none of the Xxxxxxxxxx
Registered Intellectual Property is the subject of any pending
opposition proceedings, pending cancellation proceedings, pending
interference proceedings or any other similar administrative
challenge.
23
4.15
Relationships With Related
Persons. Excluding
ownership of the Xxxxxxxxxx Shares, no Seller or any Related Person
of any Seller or of any Acquired Company has, or since January 1,
2015, has had, any interest in any property (whether real,
personal, or mixed and whether tangible or intangible), used in or
pertaining to the Business. No Seller or any Related Person of
Sellers or of any Acquired Company is, or since January 1, 2015,
has owned (of record or as a beneficial owner) an equity interest
or any other financial or profit interest in, a Person that has had
business dealings or a material financial interest in any
transaction with any Acquired Company other than business dealings
or transactions conducted in the Ordinary Course of Business with
the Acquired Companies at substantially prevailing market prices
and on substantially prevailing market terms. Except as set forth
in Part 4.15 of the Xxxxxxxxxx Disclosure Letter, no Seller or any
Related Person of Sellers or of any Acquired Company is a party to
any Material Contract.
4.16
Brokers or
Finders. None of
Xxxxxxxxxx or any of the Acquired Companies has incurred any
obligation or liability, contingent or otherwise, for brokerage or
finders’ fees or agents’ commissions or other similar
payment in connection with this Agreement.
4.17
Books and
Records. The minute
books and stock record books of the Acquired Companies, all of
which have been made available to Concierge, are complete and
correct in all material respects and have been maintained in
accordance with sound business practices. At the Closing, all of
the Acquired Companies’ books and records will be in the
possession of Concierge.
4.18
Acknowledgement.
Notwithstanding anything to the contrary set forth in this
Agreement, Xxxxxxxxxx expressly acknowledges and agrees that except
as set forth below in Article V (and at all times giving effect to
the Concierge Disclosure Letter), none of Concierge or its
Subsidiaries is making any express or implied representation or
warranty with respect to the Concierge or its Subsidiaries or the
Contemplated Transactions.
4.19
Disclaimer of
Warranties. EXCEPT
FOR THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
THIS ARTICLE IV,
(a) XXXXXXXXXX
DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR
IMPLIED, AND NO SUCH REPRESENTATION OR WARRANTY SHALL BE IMPLIED BY
OR CONSTRUED FROM ANY OF THE DUE DILIGENCE MATERIALS OR ANY OTHER
INFORMATION, WHETHER ORAL OR WRITTEN, PROVIDED BY OR ON BEHALF OF
XXXXXXXXXX OR ITS AFFILIATES.
24
(b) NO REPRESENTATION
OR WARRANTY IS MADE BY XXXXXXXXXX AS TO THE CONDITION,
MERCHANTABILITY OR FITNESS FOR ANY PURPOSE OF ANY PROPERTIES OR
ASSETS OF THE ACQUIRED COMPANIES, ALL OF WHICH ARE FOR THE PURPOSES
OF THIS AGREEMENT CONSIDERED TO BE IN “AS-IS, WHERE-IS”
CONDITION.
ARTICLE
V
REPRESENTATIONS AND
WARRANTIES OF CONCIERGE
Concierge
represents and warrants to Xxxxxxxxxx and Sellers as
follows:
5.1
Organization and Good
Standing.
(a) Concierge is duly
organized, validly existing, and in good standing under the laws of
the State of Nevada, with full corporate power and authority to
conduct its business as it is now being conducted, to own or use
the properties and assets that it purports to own or use, and to
perform all its obligations under Contracts to which it is a party.
Concierge is not required to be qualified to do business as a
foreign corporation under the laws of any state or other
jurisdiction, except where the failure to be so qualified or in
good standing would not, individually or in the aggregate, have a
Concierge Material Adverse Effect.
(b) Each Subsidiary of
Concierge is duly organized, validly existing, and in good standing
under the laws of the jurisdiction of its formation, with full
power and authority to conduct its business as it is now being
conducted, to own or use the properties and assets that it purports
to own or use, and to perform all its obligations under Contracts
to which it is a party. Each Subsidiary of Concierge is duly
qualified to do business as a foreign corporation and is in good
standing under the laws of each state or other jurisdiction in
which either the ownership or use of the properties owned or used
by it, or the nature of the activities conducted by it, requires
such qualification except where the failure to be so qualified or
in good standing would not, individually or in the aggregate, have
a Concierge Material Adverse Effect.
(c) Concierge has
delivered or made available to Xxxxxxxxxx and Sellers copies of the
Organizational Documents of Concierge and each Concierge
Subsidiary, as currently in effect.
5.2
Authority; No
Conflict.
(a) Concierge has the
absolute and unrestricted right, power, and authority to execute
and deliver this Agreement and, subject to receipt of the approval
of its stockholders, to perform its obligations hereunder. The
execution and delivery of this Agreement, and the consummation of
the Contemplated Transactions, have been duly authorized by all
requisite corporate action on the part of Concierge (other than
Shareholder Approval, which will be sought in accordance with
Section 7.4(b)), and, assuming that this Agreement has been duly
authorized, executed and delivered by the other parties hereto,
constitutes the legal, valid, and binding obligation of Concierge,
enforceable against Concierge in accordance with its terms, except
as may be limited by the Bankruptcy and Equity
Exception.
(b) Except as set forth
in Part 5.2 of the Concierge Disclosure Letter, and assuming the
Consents referred to in Section 5.2(c) below are made or obtained,
as applicable, neither the execution and delivery of this Agreement
by Concierge nor the consummation or performance of any of the
Contemplated Transactions by Concierge will, directly or indirectly
(with or without notice or lapse of time or both):
25
(i)
contravene,
conflict with, or result in a violation of any provision of the
Organizational Documents of Concierge;
(ii)
contravene,
conflict with, or result in a violation of, or give any
Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any
relief under, any Legal Requirement or any Order to which Concierge
or any of the assets owned or used by Concierge, may be subject;
or
(iii)
contravene,
conflict with, or result in a violation or breach of any provision
of, or give any Person the right to declare a default or exercise
any remedy under, or to accelerate the maturity or performance of,
or to cancel, terminate, or modify, any Concierge Material
Contract.
(c) Except as set forth
in Part 5.2(c) of the Concierge Disclosure Letter, Concierge will
not be required to give any notice to or obtain any Consent from
any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the
Contemplated Transactions.
5.3
Capitalization.
The authorized equity securities of Concierge consist of
900,000,000 shares of Concierge Common Stock and 50,000,000 shares
of Preferred Stock, consisting of 5,000,000 Series A Preferred
Stock, par value $0.001 per share (the “Series A Preferred
Stock”), and 45,000,000 shares of Series B Preferred
Stock, par value $0.001 per share (the “Series B Preferred
Stock”). As of the date hereof, 67,953,870 shares of
Concierge Common Stock, no shares of Series A Preferred Stock, and
3,754,355 shares of Series B Preferred Stock are issued and
outstanding. Concierge owns all of the issued and outstanding
equity securities of its Subsidiaries, free and clear of all Liens.
All of the outstanding equity securities of Concierge and each of
its Subsidiaries have been duly authorized and validly issued and
are fully paid and nonassessable. Except as set forth in Part 5.3
of the Concierge Disclosure Letter, there are no Contracts to which
Concierge or its Subsidiaries are a party relating to the issuance,
sale, or transfer of any equity securities or other securities by
Concierge or its Subsidiaries. All of the Concierge Shares have
been duly authorized and, when issued in the manner contemplated by
this Agreement, will be validly issued and are fully paid and
nonassessable.
5.4
SEC Reports; No Undisclosed
Liabilities.
(a) Concierge has filed
all reports, schedules, forms, statements and other documents
required to be filed by Concierge under the Securities Act and the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
since January 1, 2014 (the foregoing materials, including the
exhibits thereto and documents incorporated by reference therein,
being collectively referred to herein as the “SEC Reports”).
As of their respective dates, the SEC Reports complied in all
material respects with the requirements of the Securities Act and
the Exchange Act, as applicable, and none of the SEC Reports, when
filed, contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
26
(b) As of the date
hereof, there are no pending comments or queries from the SEC with
respect to the SEC Reports. The financial statements of Concierge
included in the SEC Reports (“Concierge Financial
Statements”) comply in all material respects with
applicable accounting requirements and the rules and regulations of
the SEC with respect thereto as in effect at the time of filing.
The Concierge Financial Statements have been prepared in accordance
with U.S. GAAP, except as may be otherwise specified in the
Concierge Financial Statements or the notes thereto and except that
unaudited financial statements may not contain all footnotes
required by U.S. GAAP, and fairly present in all material respects
the financial position of Concierge as of and for the dates thereof
and the results of operations and cash flows for the periods then
ended, subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.
(c) Except as set forth
in the balance sheet of Concierge dated as of June 30, 2016 (the
“Concierge Balance
Sheet”), Concierge has no material liabilities or
obligations, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to the date
thereof; (ii) obligations under contracts and commitments incurred
in the ordinary course of business; and (iii) liabilities and
obligations of a type or nature not required under GAAP to be
reflected in the Concierge Financial Statements, which, in all such
cases, individually and in the aggregate would not be
material.
5.5
Title to Properties;
Liens. None of
Concierge or any of its Subsidiaries owns any real property.
Part 5.5 of the
Concierge Disclosure Letter contains a complete and accurate list
of all leaseholds or other interests in real property owned by
Concierge or any of its Subsidiaries. Concierge and its
Subsidiaries own all the properties and assets (whether real,
personal, or mixed and whether tangible or intangible) reflected as
owned by them in their respective books and records, including all
of the properties and assets reflected in the Concierge Balance
Sheet (except for assets held under capitalized leases disclosed or
not required to be disclosed in Part 5.5 of the Concierge
Disclosure Letter and personal property sold since the date of the
Concierge Balance Sheet in the Ordinary Course of Business). All
material properties and assets reflected in the Concierge Balance
Sheet are free and clear of all Liens.
5.6
Taxes.
(a) Except as set forth
in Part 5.6(a) of the Concierge Disclosure Letter, (i) Concierge
and its Subsidiaries have filed or caused to be filed on a timely
basis all Tax Returns that are or were required to be filed by or
with respect to any of them since January 1, 2010, either
separately or as a member of a group of corporations, pursuant to
applicable Legal Requirements; (ii) all such Tax Returns were
correct and complete in all material respects; (iii) Concierge has
delivered or made available to Xxxxxxxxxx and Sellers copies of all
such Tax Returns relating to income Taxes filed since January 1,
2010 and (iv) Concierge and its Subsidiaries have paid, or made
provision for the payment of, all Taxes that have or may have
become due pursuant to those Tax Returns, or pursuant to any
assessment received by Concierge or any Subsidiary, except such
Taxes, if any, as are being contested in good faith and as to which
adequate reserves (determined in accordance with GAAP) have been
provided in the Concierge Balance Sheets.
27
(b) Part 5.6(b) of the
Concierge Disclosure Letter contains (i) a complete and accurate
list of all Tax Returns filed by Concierge since January 1, 2010,
and (ii) all Taxes contested in good faith by
Concierge.
(c) Except as set forth
in Part 5.6(c) of the Concierge Disclosure Letter, the United
States federal and state income Tax Returns of Concierge and its
Subsidiaries have been audited by the IRS or relevant state tax
authorities or are closed by the applicable statute of limitations.
Except as described in Part 5.6(c) of the Concierge Disclosure
Letter, none of Concierge or its Subsidiaries has given or been
requested to give waivers or extensions (or is or would be subject
to a waiver or extension given by any other Person) of any statute
of limitations relating to the payment of Taxes of Concierge or any
Subsidiary or for which Concierge or any Subsidiary may be
liable.
(d) The charges,
accruals, and reserves with respect to Taxes on the respective
books of Concierge and its Subsidiaries are adequate (determined in
accordance with GAAP) and are at least equal to the relevant
company’s liability for Taxes with respect to periods ending
on or prior to the date hereof. There exists no proposed Tax
assessment against Concierge or any Subsidiary except as disclosed
in the Concierge Balance Sheets or in Part 5.6 of the
Concierge Disclosure Letter. All Taxes that Concierge or any
Subsidiary is or was required by Legal Requirements to withhold or
collect have been duly withheld or collected and, to the extent
required, have been paid to the proper Governmental Body or other
Person.
(e) There is no Tax
sharing or similar agreement that will require any payment by
Concierge or any Subsidiary to any other Person after the date of
this Agreement.
5.7
Employee
Benefits.
(a) Except as would not
reasonably be expected to have, individually or in the aggregate, a
Concierge Material Adverse Effect: (i) each Concierge Plan
complies, in form and operation, with its terms and all Legal
Requirements, including ERISA and the IRC, in all material
respects; (ii) each Concierge Plan that is intended to be
“qualified” under Section 401(a) of the IRC has
received a favorable determination letter from the Internal Revenue
Service; and (iii) there are no actions, suits, proceedings,
hearings or, to Concierge’s Knowledge, investigations or
threatened claims against or with respect to any Concierge Plan
(other than claims for benefits in the ordinary course of plan
operations).
(b) Neither Concierge
nor any of its Subsidiaries has in the last three years contributed
or been obligated to contribute to any “Employee Pension
Plan” as defined in Section 3(2) of ERISA in the last three
years, that is subject to Title IV of ERISA or Section 412 of the
Code.
(c) None of Concierge
and its Subsidiaries has any obligation to provide any material
post-employment life or health insurance, benefits or coverage for
any participant or any beneficiary of a participant of any employee
benefit plan of Concierge or any Subsidiary, except as may be
required under COBRA and at the expense of the participant or the
participant’s beneficiary.
(d) No current employee
of Concierge or any of its Subsidiaries will become entitled to any
bonus, retirement, severance, job security or similar payment or
benefit or the acceleration or vesting of any such payment or
benefit solely as a result of the Contemplated
Transaction.
28
(e) Concierge and its
Subsidiaries are in compliance in all material respects with all
applicable laws and regulations related to employment
nondiscrimination, wages, collective bargaining, civil rights, and
the collection and payment of withholding and/or social security
taxes.
5.8
Legal Proceedings;
Orders.
(a) Except as set forth
in Part 5.8 of the Concierge Disclosure Letter, there is no pending
Proceeding: (i) that has been commenced by or against Concierge or
any of its Subsidiaries; or (ii) that challenges, or that may have
the effect of preventing, delaying, making illegal, or otherwise
interfering with, any of the Contemplated
Transactions.
(b) To the Knowledge of
Concierge, (1) except as would not, individually or in the
aggregate, have a Concierge Material Adverse Effect, no such
Proceeding has been threatened, and (2) no event has occurred or
circumstance exists that is reasonably likely to give rise to or
serve as a basis for the commencement of any such
Proceeding.
(c) Except as set forth
in Part 5.8 of the Concierge Disclosure Letter: (i) there is no
Order to which Concierge or its Subsidiaries, or any of the assets
owned or used by Concierge or its Subsidiaries, is subject; and
(ii) to Concierge’s Knowledge, no officer, director, agent,
or employee of any of Concierge or its Subsidiaries is subject to
any Order that prohibits such officer, director, agent, or employee
from engaging in or continuing any conduct, activity, or practice
relating to business activities of Concierge or its
Subsidiaries.
(d) Except as set forth
in Part 5.8 of the Concierge Disclosure Letter: (i) each of
Concierge and its Subsidiaries is, and at all times since January
1, 2012 has been, in compliance in all material respects with all
of the terms and requirements of each Order to which it is or has
been subject; and (ii) none of Concierge or any of its Subsidiaries
has received, at any time since January 1, 2012, any written notice
from any Governmental Body or any other Person regarding any
actual, alleged, possible, or potential material violation of, or
material failure to comply with, any term or requirement of any
Order to which Concierge or its Subsidiaries is or has been
subject.
5.9
Compliance With Legal Requirements;
Governmental Authorizations.
(a)
(i)
Concierge and each of its Affiliates is, and at all times since
January 1, 2015 has been, in compliance in all material respects
with each Legal Requirement that is or was applicable to it or to
the conduct or operation of its business or the ownership or use of
any of its assets;
(ii)
neither Concierge
nor any of its Affiliates has received, at any time since January
1, 2015, any notice or other communication (whether oral or
written) from any Governmental Body or any other Person regarding
(A) any actual, alleged, possible, or potential material violation
of, or material failure to comply with, any Legal Requirement, or
(B) any actual, alleged, possible, or potential obligation on the
part of any Acquired Company to undertake, or to bear all or any
portion of the cost of, any material remedial action of any
nature.
29
(b) Concierge (or its
Subsidiaries) has all Governmental Authorization necessary to
conduct the business of Concierge and its Subsidiaries as currently
conducted. Each such Governmental Authorization is valid and in
full force and effect. Concierge and each of its Subsidiaries is,
and at all times since January 1, 2012 has been, in compliance in
all material respects with all of the terms and requirements of
each Governmental Authorization that is held by Concierge or any of
its Subsidiaries and necessary to conduct its business as currently
conducted. Neither Concierge nor any of its Affiliates has
received, at any time since January 1, 2012, any notice or other
communication (whether oral or written) from any Governmental Body
or any other Person regarding (i) any actual, alleged, possible, or
potential material violation of or material failure to comply with
any term or requirement of any Governmental Authorization, or (ii)
any actual, proposed, possible, or potential revocation,
withdrawal, suspension, cancellation, termination of, or
modification to any Governmental Authorization, in each case as may
adversely affect its ability to operate its business, or the
Business, following Closing. The Governmental Authorizations
currently held by the Concierge and its Subsidiaries constitute all
of the Governmental Authorizations necessary to permit the
Concierge and its Subsidiaries to lawfully conduct and operate
their respective businesses substantially in the manner they
currently conduct and operate such businesses and to permit
Concierge and its Subsidiaries to own and use their assets
substantially in the manner in which they currently own and use
such assets.
5.10
Absence of Certain Changes
and Events. Except as
set forth in Part 5.10 of the Concierge Disclosure Letter, since
the date of the Concierge Balance Sheet, Concierge and its
Subsidiaries have conducted their respective businesses only in the
Ordinary Course of Business and there has not been
any:
(a) change in
Concierge’s or any Subsidiary’s authorized or issued
capital stock or other equity securities; grant of any stock option
or right to purchase shares of capital stock or other equity
securities of Concierge or any Subsidiary; issuance of any security
convertible into such capital stock or other equity securities;
grant of any registration rights; purchase, redemption, retirement,
or other acquisition by Concierge or any Subsidiary of any shares
of any such capital stock or other equity securities; or, except in
the Ordinary Course of Business, declaration or payment of any
dividend or other distribution or payment in respect of shares of
capital stock or other equity securities;
(b) amendment to the
Organizational Documents of Concierge or any
Subsidiary;
(c) except in the
Ordinary Course of Business, payment or increase by Concierge or
any Subsidiary of any bonuses, salaries, or other compensation to
any stockholder, director, officer, or employee or entry into any
employment, severance, or similar Contract with any director,
officer, or employee;
(d) adoption of, or
(except in the Ordinary Course of Business) increase in the
payments to or benefits under, any profit sharing, bonus, deferred
compensation, savings, insurance, pension, retirement, or other
employee benefit plan for or with any employees of Concierge or any
Subsidiary;
(e) sale (other than
sales of inventory in the Ordinary Course of Business), lease, or
other disposition of any asset or property of Concierge or any
Subsidiary or mortgage, pledge, or imposition of any Lien on any
material asset or property of Concierge or any
Subsidiary;
30
(f) cancellation or
waiver of any claims or rights with a value to Concierge or any
Subsidiary in excess of $50,000;
(g) material change in
the accounting methods used by Concierge or any Subsidiary;
or
(h) agreement, whether
oral or written, by Concierge or any Subsidiary to do any of the
foregoing.
5.11
Contracts; No
Defaults.
(a) The SEC Reports
include true and complete copies of all material Contracts that
Concierge is required by SEC rules to file with the SEC
(collectively, the “Concierge Material
Contracts”).
(b) Except as set forth
in Part 5.11(b) of the Concierge Disclosure Letter, each Concierge
Material Contract is in full force and effect and is valid and
enforceable in accordance with its terms, except as may be limited
by the Bankruptcy and Equity Exception.
(c) Except as set forth
in Part 5.11(c) of the Concierge Disclosure Letter:
(i)
each Concierge is,
and at all times since January 1, 2015 has been, in compliance in
all material respects with all applicable terms and requirements of
each Concierge Material Contract;
(ii)
to the Knowledge of
Concierge, each other Person that is a party to any Concierge
Material Contract is, and at all times since January 1, 2015 has
been, in compliance in all material respects with all applicable
terms and requirements of such Concierge Material Contract;
and
(iii)
to the Knowledge of
Concierge, no event has occurred or circumstance exists that (with
or without notice or lapse of time) may contravene, conflict with,
or result in a violation or breach of, or give Concierge or any
other Person the right to declare a default or exercise any remedy
under, or to accelerate the maturity or performance of, or to
cancel, terminate, or modify, any Concierge Material
Contract.
5.12
Insurance.
Except as set forth on Part 5.12 of the Concierge Disclosure
Letter: (i) the insurance policies to which Concierge or any
Subsidiary is a party or that provide coverage to Concierge or any
Subsidiary, or any director or officer of Concierge or any
Subsidiary with respect to its business, taken together, provide
adequate insurance coverage for the assets and the operations of
Concierge or any Subsidiary for all risks normally insured against
by a Person carrying on the same business or businesses as
Concierge or any Subsidiary; (ii) Concierge and its Subsidiaries
have paid all premiums due, and have otherwise performed all of
their respective obligations, under each policy to which Concierge
or any Subsidiary is a party or that provides coverage to Concierge
or any Subsidiary or any officer or director thereof; and (iii)
Concierge and its Subsidiaries have given notice to the insurer of
all claims of which it is aware that may be insured
thereby.
31
5.13
Intellectual
Property.
(a) Except as set forth
on Part 5.13 of the Concierge Disclosure Letter, each of Concierge
or its Subsidiaries owns, or has a valid and subsisting license or
right to use, all Intellectual Property used in, and material to,
its business as currently conducted.
(b) Part 5.13 of the
Concierge Disclosure Letter sets forth a complete and accurate list
of all Concierge Registered Intellectual Property. Except as set
forth in Part 5.13 of the Concierge Disclosure Letter (i) either
Concierge or one of its Subsidiaries has title to each item of the
Concierge Registered Intellectual Property, free and clear of any
Lien, (ii) no third party has asserted against Concierge or its
Subsidiaries a claim that Concierge or its Subsidiaries is
infringing the Intellectual Property of such third party, (iii) to
the Knowledge of Concierge, no basis for any such claim exists,
(iv) to the Knowledge of Concierge, none of the Intellectual
Property used in the conduct of the business of Concierge or its
Subsidiaries infringes upon or otherwise violates the Intellectual
Property rights of others, (v) none of the Concierge Registered
Intellectual Property is subject to any outstanding order, decree
or judgment of any Governmental Body, and (vi) to the Knowledge of
Concierge, no third party is infringing the Intellectual Property
owned by Concierge or its Subsidiaries. All required fees to
register and maintain the Concierge Registered Intellectual
Property that are due have been paid and, to the Knowledge of
Concierge, none of the Concierge Registered Intellectual Property
is the subject of any pending opposition proceedings, pending
cancellation proceedings, pending interference proceedings or any
other similar administrative challenge.
5.14
Ineligible
Persons. None of
Concierge, any “principal” (as defined in the Commodity
Exchange Act) thereof, or any “person” (as defined in
the Commodity Exchange Act) associated with Concierge that is
required or, in connection with the Contemplated Transactions will
be required, to be registered under the Commodity Exchange Act is
ineligible pursuant to Section 8a of the Commodity Exchange Act to
serve as a commodity pool operator, principal, associated person,
or in any other capacity contemplated by the Commodity Exchange
Act. There is no Proceeding pending or threatened by any
Governmental Body which would reasonably be expected to become the
basis for any such ineligibility to serve in such capacity under
Section 8a of the Commodity Exchange Act. Neither Concierge nor any
"affiliated person" (as defined under the Investment Company Act of
1940, as amended (the “Investment Company
Act”) with Concierge is ineligible pursuant to Section
9(a) or 9(b) of the Investment Company Act to serve as an
investment adviser (or in any other capacity contemplated by
Section 9(a) or 9(b) of the Investment Company Act) to a registered
investment company nor is there any Proceeding pending or, to the
knowledge of Concierge, threatened by any Governmental Entity, that
would result in the ineligibility of Concierge or such persons to
serve in any such capacities. Neither Concierge nor any person
"associated" (as defined under the Investment Advisers Act of 1940,
as amended (the “Advisers
Act”), with Concierge is ineligible pursuant to
Section 203 of the Investment Advisers Act to serve as a registered
investment adviser or as an associated person of a registered
investment adviser, nor is there any Proceeding pending or, to the
knowledge of Concierge, threatened by any Governmental Entity that
would result in the ineligibility of Concierge or such
persons.
32
5.15
Investment
Intent. Concierge is
acquiring the Xxxxxxxxxx Shares for its own account and not with a
view to their distribution within the meaning of Section 2(11) of
the Securities Act. Concierge acknowledges that the Xxxxxxxxxx
Shares are restricted securities within the meaning of Rule 144
under the Securities Act and may not be transferred except in
compliance with the Securities Act and any other applicable
securities or “blue sky” laws.
5.16
Brokers or
Finders. Except for
Cogent (the fees of which shall be borne solely by Concierge), none
of Concierge, its Affiliates, or any of their respective
Representatives have incurred any obligation or liability,
contingent or otherwise, for brokerage or finders’ fees or
agents’ commissions or other similar payment (including the
cost of obtaining the fairness opinion contemplated by Section 8.6
below) in connection with this Agreement or the Contemplated
Transactions.
5.17
Acknowledgement.
Notwithstanding anything to the contrary set forth in this
Agreement, Concierge expressly acknowledges and agrees that except
as set forth above in Article III and Article IV (and at all times
giving effect to the Xxxxxxxxxx Disclosure Letter), none of the
Acquired Companies, including Xxxxxxxxxx, Sellers or any of their
Affiliates are making any express or implied representation or
warranty with respect to the Acquired Companies, which includes
Wainwright, Sellers, the Business, any Fund, or the Contemplated
Transactions.
5.18 Limitation
on Representations and Warranties Regarding
Subsidiaries. As to
each and every Concierge representation and warranty regarding
Concierge’s Subsidiaries, Concierge is representing and
warranting as to matters existing as of:
(a) Kahnalytics, Inc.,
from inception to the date of this Agreement;
(b) Gourmet Foods,
Ltd., from August 11, 2015 to the date of this Agreement;
and
(c) Brigadier Security
Systems (2000) Ltd., from June 1, 2016, to the date of this
Agreement.
5.19 Disclaimer
of Warranties. EXCEPT
FOR THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
THIS ARTICLE V, CONCIERGE DISCLAIMS ALL REPRESENTATIONS AND
WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND NO SUCH REPRESENTATION
OR WARRANTY SHALL BE IMPLIED BY OR CONSTRUED FROM ANY OF THE DUE
DILIGENCE MATERIALS OR ANY OTHER INFORMATION, WHETHER ORAL OR
WRITTEN, PROVIDED BY OR ON BEHALF OF CONCIERGE OR ITS
SUBSIDIARIES.
ARTICLE
VI
COVENANTS OF
XXXXXXXXXX AND SELLERS
6.1
Access and
Investigation.
Between the date of this Agreement and the Closing Date, Xxxxxxxxxx
will, and will cause each of the Acquired Companies and their
Representatives to, (i) afford Concierge and its Representatives
full and free access to each of the Acquired Companies personnel,
properties, contracts, books and records, and other documents and
data, (ii) furnish Concierge and Concierge’s Representatives
with copies of all such contracts, books and records, and other
existing documents and data as Concierge may reasonably request,
and (iii) furnish Concierge and Concierge’s Representatives
with such additional financial, operating, and other data and
information as Concierge may reasonably request.
33
6.2
Operation of the Business
of the Acquired Companies. Except as set forth in Part 6.2 of the
Xxxxxxxxxx Disclosure Letter, between the date of this Agreement
and the Closing Date, Xxxxxxxxxx will, and will cause each of the
Acquired Companies to:
(a) conduct the
business of each of the Acquired Companies only in the Ordinary
Course of Business;
(b) use its
commercially reasonable efforts to preserve intact the current
business organization of each of the Acquired Companies, keep
available the services of the current officers, employees, and
agents of each of the Acquired Companies, and maintain the
relations and good will with suppliers, customers, landlords,
creditors, employees, agents, and others having business
relationships with each of the Acquired Companies;
(c) confer with
Concierge concerning operational matters of a material
nature;
(d) upon request,
report to Concierge concerning the general status of the business,
operations, and finances of each of the Acquired
Companies;
(e) not make any
dividend or distribution to its stockholders (other than any
dividend or distribution from one of the Acquired Companies to
another);
(f) preserve and
maintain all of their permits and Governmental Authorizations
required to operate the Business;
(g) pay their debts,
Taxes, and other obligations when due;
(h) comply in all
material respects with all applicable laws; and
(i) maintain their
books and records in accordance with past practices.
6.3
Negative
Covenant. Except as
otherwise expressly permitted by this Agreement, or as set forth in
Part 6.3(a) of the Xxxxxxxxxx Disclosure Letter, between the date
of this Agreement and the Closing Date, Xxxxxxxxxx will not, and
will cause each of the Acquired Companies not to, without the prior
consent of Concierge, take any affirmative action, or fail to take
any reasonable action within their or its control, as a result of
which any of the changes or events listed in Section 4.11 will
occur.
6.4
Required
Approvals. Between
the date of this Agreement and the Closing Date, Xxxxxxxxxx shall,
and shall cause each of the Acquired Companies to, make all filings
required by Legal Requirements to be made by them in order to
consummate the Contemplated Transactions (including, if and to the
extent necessary, all filings under the HSR Act). Between the date
of this Agreement and the Closing Date, Xxxxxxxxxx shall, and shall
cause the Acquired Companies to, (a) cooperate with Concierge with
respect to all filings Concierge elects to make or is required by
Legal Requirements to make in connection with the Contemplated
Transactions, and (b) cooperate with Concierge in obtaining all
consents identified in Part 5.2 of the Concierge Disclosure Letter
(including, if and to the extent necessary, taking all actions
reasonably requested to cause early termination of any applicable
waiting period under the HSR Act).
34
6.5
Notification.
Between the date of this Agreement and the Closing Date, Xxxxxxxxxx
will promptly notify Concierge in writing if Xxxxxxxxxx or any of
the Acquired Companies becomes aware of any fact or condition that
causes or constitutes a breach of any representation or warranty
set forth in Article III or Article IV as of the date of this
Agreement, or if Xxxxxxxxxx or any of the Acquired Companies
becomes aware of the occurrence after the date of this Agreement of
any fact or condition that would (except as expressly contemplated
by this Agreement) cause or constitute a breach of any such
representation or warranty had such representation or warranty been
made as of the time of occurrence or discovery of such fact or
condition. Should any such fact or condition require any change in
the Xxxxxxxxxx Disclosure Letter if the Xxxxxxxxxx Disclosure
Letter were dated the date of the occurrence or discovery of any
such fact or condition, Xxxxxxxxxx will promptly deliver to
Concierge a supplement to the Xxxxxxxxxx Disclosure Letter
specifying such change. During the same period, Xxxxxxxxxx will
promptly notify Concierge of the occurrence of any breach of any
covenant of Xxxxxxxxxx or Sellers in this Article VI or of the
occurrence of any event that may make the satisfaction of the
conditions in Article VIII impossible or unlikely.
6.6
Payment of
Indebtedness. Except
as expressly provided in this Agreement, or in Part 6.6 of the
Xxxxxxxxxx Disclosure Letter, Xxxxxxxxxx will (i) cause all
indebtedness owed to any of the Acquired Companies by any Seller or
any Related Person of any Seller to be paid in full prior to
Closing, and (ii) cause all indebtedness for borrowed money owed by
any of the Acquired Companies to any other Person (including any
Seller) to be paid in full prior to Closing.
6.7
No
Negotiation. Until
such time, if any, as this Agreement is terminated pursuant to
Article X, Xxxxxxxxxx will not, and will cause each of the Acquired
Companies and each of their Representatives not to, directly or
indirectly solicit, initiate, or encourage any inquiries or
proposals from, discuss or negotiate with, provide any non-public
information to, or consider the merits of any unsolicited inquiries
or proposals from, any Person (other than Concierge) relating to
any transaction involving the sale of the business or assets (other
than in the Ordinary Course of Business) of any of the Acquired
Companies, or any of the capital stock or other equity security of
any of the Acquired Companies, or any merger, consolidation,
business combination, or similar transaction involving any of the
Acquired Companies.
6.8
Commercially Reasonable
Efforts. Between the
date of this Agreement and the Closing Date, Xxxxxxxxxx and each
Seller will use its commercially reasonable efforts to cause the
conditions in Article VIII to be satisfied.
6.9
Audit Fees.
Xxxxxxxxxx understands, acknowledges, and agrees that Concierge is
a public reporting company and is required to submit certain
audited and other financial statements to the SEC in conjunction
with the Contemplated Transactions. Xxxxxxxxxx shall engage a
qualified auditor to audit its financial statements and the
financial statements of the Acquired Companies in order to satisfy
the SEC’s financial statement requirements (the “Xxxxxxxxxx Audited
Financial Statements”). Xxxxxxxxxx shall cover the
cost of such audit.
35
ARTICLE
VII
COVENANTS OF
CONCIERGE
7.1
Access and
Investigation.
Between the date of this Agreement and the Closing Date, Concierge
will, and will cause each of its Subsidiaries and its
Representatives to, (i) afford Xxxxxxxxxx and each of its
Representatives full and free access to Concierge’s and each
of its Subsidiary’s personnel, properties, contracts, books
and records, and other documents and data, (ii) furnish Xxxxxxxxxx
and its Representatives with copies of all such contracts, books
and records, and other existing documents and data as Xxxxxxxxxx
and its Representatives may reasonably request, and (iii) furnish
Xxxxxxxxxx and its Representatives with such additional financial,
operating, and other data and information as Xxxxxxxxxx and its
Representatives may reasonably request.
7.2
Operation of the Business
of Concierge and its Subsidiaries. Except as set forth in Part 7.2 of the
Concierge Disclosure Letter, between the date of this Agreement and
the Closing Date, Concierge will, and will cause each of its
Subsidiaries to:
(a) conduct the
business of Concierge and such Subsidiaries only in the Ordinary
Course of Business;
(b) use its
commercially reasonable efforts to preserve intact the current
business organization of Concierge and such Subsidiaries, keep
available the services of the current officers, employees, and
agents of Concierge and such Subsidiaries, and maintain the
relations and good will with suppliers, customers, landlords,
creditors, employees, agents, and others having business
relationships with Concierge and such Subsidiaries;
(c) confer with
Xxxxxxxxxx concerning operational matters of a material
nature;
(d) upon request,
report to Xxxxxxxxxx concerning the general status of the business,
operations, and finances of Concierge and its Subsidiaries;
and
(e) not make any
dividend or distribution to its stockholders (other than any
dividend or distribution from a Subsidiary of Concierge to
Concierge).
(f) preserve and
maintain all of its permits and Governmental Authorizations
required to operate the business of Concierge and its
Subsidiaries;
(g) pay the debts,
Taxes, and other obligations of Concierge and its Subsidiaries when
due;
(h) comply in all
material respects with all applicable laws; and
(i) maintain its books
and records of Concierge and its Subsidiaries in accordance with
past practices.
7.3
Negative
Covenant. Except as
otherwise expressly permitted by this Agreement, or as set forth in
Part 7.3 of the Concierge Disclosure Letter, between the date of
this Agreement and the Closing Date, Concierge will not, and will
cause each Subsidiary not to, without the prior consent of
Xxxxxxxxxx, take any affirmative action, or fail to take any
reasonable action within their or its control, as a result of which
any of the changes or events listed in Section 5.10 will
occur.
36
7.4
Approvals of Governmental
Bodies; Shareholders.
(a) Between the date of
this Agreement and the Closing Date, Concierge will, and will cause
each of its Related Persons to, make all filings required by Legal
Requirements to be made by them to consummate the Contemplated
Transactions (including, if and to the extent necessary, all
filings under the HSR Act). Between the date of this Agreement and
the Closing Date, Concierge will, and will cause each Related
Person to, cooperate with Sellers with respect to all filings that
Sellers are required by Legal Requirements to make in connection
with the Contemplated Transactions, and (ii) cooperate with
Xxxxxxxxxx in obtaining all consents identified in Part 4.2 of the
Xxxxxxxxxx Disclosure Letter.
(b) Without in any way
limiting the foregoing Section 7.4(a), as soon as reasonably
practicable following the date hereof, Concierge shall (i) obtain
the necessary written shareholder consents to approve this
Agreement and the Contemplated Transactions (the “Shareholder
Approval”), (ii) file with the SEC a preliminary
information statement on Schedule 14C with respect to the
Contemplated Transactions (the “Preliminary Consent
Statement”), and (iii) file with the SEC, and mail or
deliver to the Concierge Shareholders, a definitive information
statement on Schedule 14C with respect to the Contemplated
Transactions (the “Definitive Consent
Statement”). Concierge shall use its reasonable best
efforts to have the Preliminary Consent Statement cleared by the
staff of the SEC as promptly as practicable after such filing, and
Concierge shall thereafter mail or deliver the Definitive Consent
Statement to the Concierge Shareholders at least twenty (20)
calendar days prior to the anticipated date of Closing. Xxxxxxxxxx
shall furnish all information concerning Xxxxxxxxxx and its
Subsidiaries for inclusion in the Preliminary Consent Statement and
Definitive Consent Statement as may be reasonably requested by
Concierge, and shall have the right to review in advance, and, to
the extent practicable, to provide comments on, the Preliminary
Consent Statement prior to its filing and the Definitive Consent
Statement prior to its and mailing to Concierge
Shareholders.
(c) Each of Concierge
and Xxxxxxxxxx shall promptly advise the other upon receiving any
communication from any Governmental Body, the consent or approval
of which is required for consummation of the Contemplated
Transactions, in connection with the Contemplated
Transactions.
7.5
Notification.
Between the date of this Agreement and the Closing Date, Concierge
will promptly notify Xxxxxxxxxx in writing if Concierge becomes
aware of any fact or condition that causes or constitutes a breach
of any of Concierge’s representations and warranties as of
the date of this Agreement, or if Concierge becomes aware of the
occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this
Agreement) cause or constitute a breach of any such representation
or warranty had such representation or warranty been made as of the
time of occurrence or discovery of such fact or condition. During
the same period, Concierge will promptly notify Xxxxxxxxxx of the
occurrence of any breach of any covenant of Concierge in this
Article VII or of the occurrence of any event that may make the
satisfaction of the conditions in Article IX impossible or
unlikely.
37
7.6
Commercially Reasonable
Efforts. Between the
date of this Agreement and the Closing Date, Concierge will use its
commercially reasonable efforts to cause the conditions in Article
IX to be satisfied.
7.7
No
Negotiation. Except
as set forth in Part 7.7 of the Concierge Disclosure Schedule,
until such time, if any, as this Agreement is terminated pursuant
to Article X, Concierge will not, and will cause each Subsidiary
and each of their Representatives not to, directly or indirectly
solicit, initiate, or encourage any inquiries or proposals from,
discuss or negotiate with, provide any non-public information to,
or consider the merits of any unsolicited inquiries or proposals
from, any Person (other than Xxxxxxxxxx) relating to any
transaction involving the sale of the business or assets of
Concierge or any Subsidiary, or any of the capital stock or other
equity security of Concierge or any Subsidiary, or any merger,
consolidation, business combination, or similar transaction
involving Concierge or any Subsidiary.
ARTICLE
VIII
CONDITIONS
PRECEDENT TO CONCIERGE’S OBLIGATION TO
CLOSE
Concierge’s
obligation to purchase the Xxxxxxxxxx Shares and to take the other
actions required to be taken by Concierge at the Closing is subject
to the satisfaction, at or prior to the Closing, of each of the
following conditions (any of which may, to the extent permitted by
applicable Legal Requirements, be waived by Concierge, in whole or
in part, as long as such waiver is in writing):
8.1
Accuracy of
Representations.
(a) Each Seller’s
representations and warranties set forth in Article III must have
been accurate as of the date of this Agreement, and must be
accurate as of the Closing Date as if made on the Closing
Date.
(b) All of the
representations and warranties set forth in Article IV (considered
collectively), and each of such representations and warranties
(considered individually), must have been accurate as of the date
of this Agreement, and must be accurate as of the Closing Date as
if made on the Closing Date, in each case giving effect to the
Xxxxxxxxxx Disclosure Letter or any supplement thereto, except to
the extent such inaccuracies would not, individually or in the
aggregate, have a Xxxxxxxxxx Material Adverse Effect.
8.2
Sellers’ and
Xxxxxxxxxx’x Performance.
(a) All of the
covenants and obligations that Sellers or Xxxxxxxxxx are required
to perform or to comply with pursuant to this Agreement at or prior
to the Closing (considered collectively), and each of such
covenants and obligations (considered individually), must have been
duly performed and complied with in all material
respects.
(b) Sellers and
Xxxxxxxxxx must have delivered each of the documents required to be
delivered to Concierge pursuant to Section 2.4 (except to the
extent release of same is conditioned upon occurrence of the
Closing).
(c) Without in any way
limiting this Section 8.2(a), Xxxxxxxxxx shall have delivered to
Concierge the Xxxxxxxxxx Audited Financial Statements.
38
8.3
Concierge Shareholder
Approval. The
Shareholder Approval shall have been obtained in accordance with
Nevada law, and the definitive Schedule 14C shall have been mailed
to shareholders of Concierge in accordance with SEC rules and
Nevada law.
8.4
Consents. Each of the Consents denoted by an
asterisk (*) in Part 4.2 of the Xxxxxxxxxx Disclosure Letter
must have been obtained and must be in full force and
effect.
8.5
No
Proceedings. As of
the proposed Closing Date, there must not be pending against any
Seller, Xxxxxxxxxx, or any of the Acquired Companies any bona fide
third party Proceeding reasonably likely of success
(a) involving any challenge to, or seeking damages or other
relief in connection with, any of the Contemplated Transactions, or
(b) that may have the effect of preventing, delaying, making
illegal, or otherwise interfering with any of the Contemplated
Transactions.
8.6
Fairness Opinion.
Concierge shall have received the opinion of Cogent to the effect
that, as of the date hereof, and based upon and subject to the
limitations and assumptions set forth in such opinion, the Purchase
Price to be paid by Concierge pursuant to this Agreement is fair,
from a financial point of view, to the holders of shares of
Concierge.
8.7
Independent Advisory
Committee. The independent advisory committee (the
“Advisory
Committee”) appointed by Concierge shall have reviewed
and approved the terms of the Contemplated Transactions (including
the Per-Share Price and the consideration to be received by the
Xxxxxxxxxx Sellers hereunder), and determined that the Contemplated
Transactions are in the best interest of Concierge and the
Concierge Shareholders.
ARTICLE
IX
CONDITIONS
PRECEDENT TO SELLERS’ and wainrwright’s OBLIGATION TO
CLOSE
Sellers’
obligation to sell the Xxxxxxxxxx Shares and to take the other
actions required to be taken by Sellers at the Closing, and
Xxxxxxxxxx’x obligation to take actions required of it at the
Closing, are subject to the satisfaction, at or prior to the
Closing, of each of the following conditions (any of which may, to
the extent permitted by applicable Legal Requirements, be waived by
Sellers, Wainwright, in whole or in part, as long as such waiver is
in writing):
9.1
Accuracy of
Representations. All
of the representations and warranties set forth in Article V
(considered collectively), and each of such representations and
warranties (considered individually), must have been accurate as of
the date of this Agreement, and must be accurate as of the Closing
Date as if made on the Closing Date, in each case giving effect to
the Concierge Disclosure Letter or any supplement thereto, to the
extent such inaccuracies would not, individually or in the
aggregate, have a Concierge Material Adverse Effect.
9.2
Concierge’s
Performance.
(a) All of the
covenants and obligations that Concierge is required to perform or
to comply with pursuant to this Agreement at or prior to the
Closing (considered collectively), and each of such covenants and
obligations (considered individually), must have been performed and
complied with in all material respects.
39
(b) Concierge must have
delivered each of the documents required to be delivered by
Concierge pursuant to Section 2.4 (except to the extent release of
same is conditioned upon occurrence of Closing).
9.3
Concierge Shareholder
Approval. The
Shareholder Approval shall have been obtained in accordance with
Nevada law, and the definitive Schedule 14C shall have been mailed
to shareholders of Concierge in accordance with SEC rules and
Nevada law..
9.4
Consents. Each of the Consents denoted by an
asterisk (*) in Part 5.2 of the Concierge Disclosure Letter must
have been obtained and must be in full force and
effect.
9.5
No
Proceedings. As of
the proposed Closing Date, there must not be pending against
Concierge any bona fide third party Proceeding reasonably likely of
success (a) involving any challenge to, or seeking damages or
other relief in connection with, any of the Contemplated
Transactions, or (b) that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with any of the
Contemplated Transactions.
9.6
Cogent Materials and
Schedule 14C. Each Seller shall have received a copy of the
Cogent fairness opinion, any other valuation or related materials
provided by Cogent to the Concierge Board, a copy of the definitive
Schedule 14C mailed to Concierge Shareholders and, based upon a
review of such materials, shall in its discretion elect to proceed
with the sale of Xxxxxxxxxx Shares owned by such
Seller.
ARTICLE
X
TERMINATION
10.1
Termination
Events. This
Agreement may, by notice given prior to or at the Closing, be
terminated:
(a) by either
Concierge, on the one hand, or Xxxxxxxxxx and Sellers, on the other
hand, if a material breach of any provision of this Agreement has
been committed by the other party and such breach has not been
waived; provided, however,
that the breaching party shall have thirty (30) days from the date
of receipt of written notice of such breach from the non-breaching
party in which to cure such breach;
(b) (i) by Concierge if
any of the conditions in Article VIII have not been satisfied as of
the Closing Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of Concierge to
comply with its obligations under this Agreement) and Concierge has
not waived such condition on or before the Closing Date; or (ii) by
Xxxxxxxxxx and Sellers, acting through Xxxxxxxxxx, if any of the
conditions in Article IX has not been satisfied of the Closing Date
or if satisfaction of such a condition is or becomes impossible
(other than through the failure of Sellers to comply with their
obligations under this Agreement) and Sellers and Xxxxxxxxxx have
not waived such condition on or before the Closing
Date;
40
(c) by mutual consent
of Concierge, Xxxxxxxxxx and Sellers; or
(d) by either
Concierge, on the one hand, or Xxxxxxxxxx and the Sellers, on the
other hand, if the Closing has not occurred (other than through the
failure of any party seeking to terminate this Agreement to comply
fully with its obligations under this Agreement) on or before
December 31, 2016, or such later date as the parties may agree
upon, in writing.
10.2
Effect of
Termination. If this
Agreement is terminated pursuant to Section 10.1, all further
obligations of the parties under this Agreement will terminate,
except that the obligations in Sections 12.1 and 12.3 will survive;
provided, however, that if
this Agreement is terminated by a party because of the breach of
the Agreement by the other party or because one or more of the
conditions to the terminating party’s obligations under this
Agreement is not satisfied as a result of the other party’s
failure to comply with its obligations under this Agreement, the
terminating party’s right to pursue all legal remedies will
survive such termination unimpaired.
ARTICLE
XI
INDEMNIFICATION;
REMEDIES
11.1
Survival. All representations, warranties,
covenants, and obligations in this Agreement will survive the
Closing; provided, however,
that the right to be indemnified for any breach of a
representation, warranty, covenant or other obligation shall be
limited as set forth herein.
11.2
Indemnification and Payment
of Damages by Sellers.
(a) If the Closing
occurs, each Seller, severally and not jointly, shall indemnify and
hold harmless Concierge and its Representatives, stockholders,
controlling persons, and Affiliates (collectively, the
“Concierge Indemnified
Parties”) for the amount of any loss, Liability,
claim, damage, expense (including reasonable costs of investigation
and defense and reasonable attorneys’ fees) (collectively,
“Damages”),
arising from any breach of any representation or warranty made by
such Seller in Article III of this Agreement.
(b) If the Closing
occurs, the Sellers, severally and not jointly (according to their
respective Indemnification Percentages), shall indemnify and hold
harmless the Concierge Indemnified Parties for, and will pay to the
Concierge Indemnified Parties the amount of, any Damages resulting
from:
(i)
any breach of any
representation or warranty contained in Article IV of this
Agreement; and
(ii)
any breach of any
covenant or obligation of Xxxxxxxxxx in this
Agreement.
11.3
Indemnification and Payment
of Damages By Concierge. If the Closing occurs, Concierge will
indemnify and hold harmless Sellers and their respective
Representatives, stockholders, controlling persons, and Affiliates
(collectively, the “Seller Indemnified
Parties”) for any Damages arising, directly or
indirectly, from or in connection with (a) any breach of any
representation or warranty made by Concierge in this Agreement, and
(b) any breach by Concierge of any covenant or obligation of
Concierge in this Agreement. Such indemnification shall be payable
to Sellers according to their respective Pro Rata
Shares.
41
11.4
Time
Limitations. If the
Closing occurs, no Seller will have any liability (for
indemnification or otherwise) with respect to any representation or
warranty (other than those in Sections 3.2, 3.3, 3.4, 4.2(a), 4.3,
4.6 or 4.16), or any covenant or obligation to be performed and
complied with prior to the Closing Date, unless on or before the
first anniversary of the Closing Date, Concierge notifies Sellers
of a claim specifying the factual basis of that claim in reasonable
detail to the extent then known by Concierge. A claim with respect
to Section 4.6 may be made at any time prior to the thirtieth
(30th) day
immediately following the expiration of the applicable statute of
limitations that applies to the relevant matter in question. A
claim with respect to Sections 3.2, 3.3, 3.4, 4.2(a), 4.3 or 4.16
may be made at any time. If the Closing occurs, Concierge will have
no liability (for indemnification or otherwise) with respect to any
representation or warranty (other than those in Sections 5.2(a),
5.3, 5.6 or 5.16), or covenant or obligation to be performed and
complied with prior to the Closing Date, unless on or before the
first anniversary of the Closing Date, Sellers notify Concierge of
a claim specifying the factual basis of that claim in reasonable
detail to the extent then known by Sellers. A claim with respect to
Sections 5.2(a), 5.3 or 5.16) may be made at any time. A claim with
respect to Section 5.6 may be made at any time prior to the
thirtieth (30th) day immediately
following the expiration of the applicable statute of limitations
that applies to the relevant matter in question.
11.5
Limitations on Amount
– Sellers.
(a) No Seller will have
any liability (for indemnification or otherwise) with respect to
the matters described in Section 11.2(b)(i) or, to the extent
relating to any failure to perform or comply prior to the Closing
Date, Section 11.2(b)(ii), until the total of all Damages with
respect to such matters exceeds two percent (2%) of the aggregate
value (based on the Concierge Per Share Price) of the Purchase
Price actually issued by Concierge to Sellers (the
“Deductible”),
and then only for the amount by which such Damages exceed the
Deductible; provided,
however, that in no event shall the aggregate amount payable
by the Sellers under Section 11.2(b)(i) and (b)(ii) exceed
$8,500,000 (the “Cap”).
(b) Notwithstanding
anything to the contrary contained herein, (i) all obligations of
Sellers to make indemnification payments under this Article XI
shall be satisfied by the transfer from Sellers to Concierge of
Concierge Shares having an aggregate value (based on the Concierge
Per-Share Price) equal to the amount of indemnification owed; (ii)
in no event shall any Seller be liable for indemnification under
Section 11.2(a) in excess of the value of the Concierge Shares
actually received by such Seller (based on the Concierge Per Share
Price); and (iii) in no event shall any Seller be liable for
indemnification under Section 11.2(b) for an amount in excess of
such Seller’s Indemnification Percentage of the amount of
indemnification fully and finally determined to be due and payable
to a Concierge Indemnified Party thereunder (but subject at all
times to the limitations set forth in this Article
XI).
11.6
Limitation on Amount
– Concierge.
Concierge will have no liability (for indemnification or otherwise)
with respect to the matters described in Section 11.3(a) or, to the
extent relating to an alleged failure to perform any covenant prior
to the Closing Date, Section 11.3(b), until the total of all
Damages with respect to such matters exceeds the Deductible, and
then only for the amount by which such Damages exceed the
Deductible; provided, however, that in no event shall the aggregate
amount payable by Concierge under Section 11.3(a) exceed the
Cap.
42
11.7
Additional
Limitations. The
rights of the Seller Indemnified Parties and Concierge Indemnified
Parties to be indemnified under this Article XI shall be subject to
the following limitations:
(a) No party shall be
entitled to recover Damages (i) for punitive, exemplary or special
damages of any nature, (ii) for indirect or consequential damages,
including damages for lost profit, lost business opportunity or
damage to business reputation, or (iii) relating to or arising out
of any act or omission of the indemnified party after the date of
Closing.
(b) No party shall be
entitled to recover under this Article XI for any Damages to the
extent such Damages arise out of any changes, after the Closing
Date, in applicable Legal Requirements or GAAP, or the
interpretations thereof.
(c) The Concierge
Indemnified Parties shall not be entitled to recover under this
Article XI for Damages to the extent that the basis for such
Damages is adequately provided or accounted for or reflected in the
Xxxxxxxxxx Balance Sheet.
(d) In no event may a
party recover any Damages under one section of this Agreement to
the extent Damages with respect to the same matter have been
previously recovered under any other section of this
Agreement.
(e) In addition to, and
not in limitation of any other provision herein, each party will
use its commercially reasonable efforts to mitigate any Damages
with respect to which it may be entitled to seek indemnification
pursuant to this Agreement, and no party shall be entitled to
indemnification for Damages to the extent it can be demonstrated
that such Damages would not have occurred but for the failure of
the party seeking indemnification to mitigate as herein
provided.
(f) If any indemnified
party is indemnified for any Damages pursuant to this Agreement
with respect to any Third Party Claim, then the indemnifying party
will be subrogated to all rights and remedies of such indemnified
party against such third party and any other party with respect to
the matter forming the basis for the Third Party Claim, and the
indemnified party will cooperate with and assist the indemnifying
party in asserting all such rights and remedies against such
parties (with the benefits of any recovery to be distributed to the
indemnifying party).
11.8
Exclusive Remedies.
If the Closing occurs, the remedies set forth in this Article XI
shall be the exclusive remedies of the parties for any breach of
his Agreement.
11.9
Characterization of
Payments. Any payment
made to a Concierge Indemnified Party or a Seller Indemnified Party
pursuant to this Article XI shall be treated as an adjustment of
the Purchase Price for all purposes, including Tax purposes, to the
maximum extent permitted by applicable Legal
Requirements.
43
11.10
Procedure for
Indemnification – Third Party Claims.
(a) Promptly after
receipt by an indemnified party under Section 11.2 or 11.3 of
notice of the commencement by a third party of any Proceeding
against it (a “Third Party
Claim”), such indemnified party will, if a claim is to
be made against an indemnifying party under such Section, promptly
give notice to the indemnifying party of the commencement of such
Proceeding (a “Third Party Claim
Notice”).
(b) If any Third Party
Claim is brought against a party and such party gives Third Party
Claim Notice to the indemnifying party of the commencement of the
Proceeding forming the basis of the Third Party Claim, the
indemnifying party will be entitled to participate in such
Proceeding and, to the extent that it wishes (unless the
indemnifying party is also a party to such Proceeding and the
indemnified party is advised in writing by its counsel that joint
representation would be inappropriate under applicable standards of
professional conduct), or (ii) the indemnifying party fails to
provide reasonable assurance to the indemnified party of its
financial capacity to defend such Proceeding and provide
indemnification with respect to such Proceeding), to assume the
defense of such Proceeding and, after notice from the indemnifying
party to the indemnified party of its election to assume the
defense of such Proceeding, the indemnifying party will not be
liable to the indemnified party under this Article XI for any fees
of other counsel or any other expenses with respect to the defense
of such Proceeding subsequently incurred by the indemnified party
in connection with the defense of such Proceeding. If the
indemnifying party assumes the defense of a Proceeding, no
compromise or settlement of such claims may be effected by the
indemnifying party without the indemnified party’s consent
unless (A) there is no finding or admission of any violation of
Legal Requirements, and (B) the sole relief provided is monetary
damages that are paid in full by the indemnifying party. If a Third
Party Claim Notice is given to the indemnifying party and the
indemnifying party does not, within ten (10) days after the Third
Party Claim Notice is given, give notice to the indemnified party
of its election to assume the defense of such Proceeding, the
indemnified party shall proceed with the defense of such Third
Party Claim; provided,
however, that no compromise or settlement of such claims may
be effected by the indemnified party without the indemnifying
party’s consent.
(c) Notwithstanding the
foregoing, if an indemnified party determines in good faith that
there is a reasonable probability that a Proceeding may adversely
affect it or its Affiliates other than as a result of monetary
damages for which it would be entitled to indemnification under
this Agreement, the indemnified party may, by notice to the
indemnifying party, and at its sole cost and expense, participate
in the defense, compromise or settlement of such
Proceeding.
11.11
Procedure for
Indemnification – Other Claims. A claim for indemnification for any
matter not involving a Third Party Claim may be asserted by notice
to the party from whom indemnification is sought.
ARTICLE
XII
GENERAL
PROVISIONS
12.1
Expenses. Except as otherwise expressly provided
in this Agreement, each party to this Agreement will bear its
respective expenses incurred in connection with the preparation,
negotiation and execution of, and performance of its obligations
under, this Agreement, including all fees and expenses of its
Representatives; provided,
however, that for the avoidance of doubt, Concierge shall
pay the full amount of the filing fee required in connection with
any filings (if any) required under the HSR Act. In the event of
termination of this Agreement, the obligation of each party to pay
its own expenses will be subject to any rights of such party
arising from a breach of this Agreement by another
party.
44
12.2
Public
Announcements. Any
public announcement or similar publicity with respect to this
Agreement or the Contemplated Transactions will be made, if at all,
at such time and in such manner as Concierge and Xxxxxxxxxx
mutually agree, unless otherwise required by applicable Legal
Requirements. Xxxxxxxxxx and Concierge will consult with each other
concerning the means by which the Acquired Companies’
employees, customers, and suppliers and others having dealings with
the Acquired Companies will be informed of the Contemplated
Transactions, and Concierge will have the right to be present for
any such communication.
12.3
Confidentiality.
Between the date of this Agreement and the Closing Date, except as
expressly contemplated by this Agreement, each of Concierge and
Xxxxxxxxxx shall continue to be bound by the terms of the
Confidentiality Agreement. If the Contemplated Transactions are not
consummated, each party will return or destroy as much of such
written information as the other party may reasonably request, and
each Party will continue to be bound by the Confidentiality
Agreement in accordance with its terms.
12.4
Notices. All notices, consents, waivers, and
other communications under this Agreement must be in writing and
will be deemed to have been duly given when (a) delivered by hand
(with written confirmation of receipt), (b) sent by telecopier
(with written confirmation of receipt), provided that a copy is
mailed by registered mail, return receipt requested, or (c) when
received by the addressee, if sent by a nationally recognized
overnight delivery service (receipt requested), in each case to the
appropriate addresses and telecopier numbers set forth below (or to
such other addresses and telecopier numbers as a party may
designate by notice to the other parties):
Concierge
Technologies, Inc.
00000
Xxxxxx Xxxxxx Xx., X-000
Xxxxxx
Xxxxxx, XX 00000
Attn:
Xxxxx Xxxxxxx, CEO
Fax:
000.000.0000
With a
copy to:
Xxxxxxx
+ Xxxxxxxxx, A Professional Law Corporation
00
Xxxxxxx, Xxxxx 000
Xxxx
Xxxxxx, XX 00000
Attn:
Xxxxxxxx X. Xxxxxxx, Esq.
Fax:
000.000.0000
45
Xxxxxxxxxx:
Xxxxxxxxxx
Holdings, Inc.
Xxxxxxxxxx
Inc.
0000
Xxxxxxxx Xxxxxx
Xxxxx
0000
Xxxxxxx,
XX 00000
Attention:
Xxxx Xxxxxx
Facsimile
No: 925.376.3490
with a
copy to:
Xxxxxxxxxx
Xxxxxx & Xxxxxxx LLP
000
Xxxxx Xx. XX
Xxxxxxxxxx,
XX 00000
Attention:
Xxxxx X. Xxxx, Esq.
Facsimile
No.: 202.637.3593
Sellers:
See
signature pages of Sellers on Investor Questionnaires
12.5
Jurisdiction; Service of
Process. Any action
or proceeding seeking to enforce any provision of, or based on any
right arising out of, this Agreement may be brought against any of
the parties in the courts of the State of
California, Orange
County, or, if it has or can acquire jurisdiction, in the United
States District Court located in Orange County,
California, and
each of the parties consents to the jurisdiction of such courts
(and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue laid therein. Process
in any action or proceeding referred to in the preceding sentence
may be served on any party anywhere in the world.
12.6
Further
Assurances. The
parties agree (a) to furnish upon request to each other such
further information, (b) to execute and deliver to each other
such other documents, and (c) to do such other acts and
things, all as the other party may reasonably request for the
purpose of carrying out the intent of this Agreement and the
documents referred to in this Agreement.
12.7
Waiver. Neither the failure nor any delay by
any party in exercising any right, power, or privilege under this
Agreement or the documents referred to in this Agreement will
operate as a waiver of such right, power, or privilege, and no
single or partial exercise of any such right, power, or privilege
will preclude any other or further exercise of such right, power,
or privilege or the exercise of any other right, power, or
privilege. To the maximum extent permitted by applicable law,
(a) no claim or right arising out of this Agreement or the
documents referred to in this Agreement can be discharged by one
party, in whole or in part, by a waiver or renunciation of the
claim or right unless in writing signed by the other party;
(b) no waiver that may be given by a party will be applicable
except in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party
giving such notice or demand to take further action without notice
or demand as provided in this Agreement or the documents referred
to in this Agreement.
12.8
Entire Agreement and
Modification. This
Agreement supersedes all prior agreements between the parties with
respect to its subject matter (other than the Confidentiality
Agreement, which shall, except as expressly contemplated by this
Agreement, remain in full force and effect) and constitutes (along
with the documents referred to in this Agreement) a complete and
exclusive statement of the terms of the agreement between the
parties with respect to its subject matter. This Agreement may not
be amended except by a written agreement executed by the party to
be charged with the amendment.
46
12.9
Disclosure
Letters.
Notwithstanding anything in this Agreement to the contrary, the
mere inclusion of an item as an exception to a representation or
warranty in the Xxxxxxxxxx Disclosure Letter or Concierge
Disclosure Letter, as applicable, shall not be deemed an admission
that such item represents a material exception or material fact,
event or circumstance or that such item has had or would be
reasonably likely to have a Xxxxxxxxxx Material Adverse Effect,
Fund Material Adverse Effect or a Concierge Material Adverse
Effect, as applicable. Each part of the Xxxxxxxxxx Disclosure
Letter and Concierge Disclosure Letter shall be numbered to
correspond with the sections and subsections contained in this
Agreement; provided,
however, that the disclosure in any Part of the Xxxxxxxxxx
Disclosure Letter and Concierge Disclosure Letter, as applicable,
shall qualify (i) the corresponding section or subsection, as the
case may be, of this Agreement, (ii) other sections or subsections
of this Agreement to the extent specifically cross-referenced in
such section or subsection thereof, and (iii) other sections or
subsections of this Agreement to the extent that such disclosure
would be applicable to such other sections or
subsections.
12.10
Assignments, Successors,
and No Third-Party Rights. Neither party may assign any of its
rights under this Agreement without the prior consent of the other
parties. Subject to the preceding sentence, this Agreement will
apply to, be binding in all respects upon, and inure to the benefit
of the successors and permitted assigns of the parties. Nothing
expressed or referred to in this Agreement will be construed to
give any Person other than the parties to this Agreement any legal
or equitable right, remedy, or claim under or with respect to this
Agreement or any provision of this Agreement. This Agreement and
all of its provisions and conditions are for the sole and exclusive
benefit of the parties to this Agreement and their successors and
assigns.
12.11
Severability.
If any provision of this Agreement is held invalid or unenforceable
by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision
of this Agreement held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held
invalid or unenforceable.
12.12
Section Headings;
Construction. The
headings of Sections in this Agreement are provided for convenience
only and will not affect its construction or interpretation. All
references to “Section” or “Sections” refer
to the corresponding Section or Sections of this Agreement. All
words used in this Agreement will be construed to be of such gender
or number as the circumstances require. Unless otherwise expressly
provided, the word “including” does not limit the
preceding words or terms.
12.13
Governing
Law. This Agreement
will be governed by the laws of the State of
California without
regard to conflicts of laws principles.
12.14
Counterparts.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and
all of which, when taken together, will be deemed to constitute one
and the same agreement.
[Signature
pages follow]
47
IN WITNESS WHEREOF, the
parties have executed and delivered this Agreement as of the date
first written above.
CONCIERGE
TECHNOLOGIES, INC.
By:
Its:
XXXXXXXXXX
HOLDINGS, INC.
By:
Its:
[signature page to Stock Purchase
Agreement]
THE
XXXXXXXX & XXXXXXX XXXXXX LIVING TRUST
__________________________
By:
Its:
[signature page to Stock Purchase
Agreement]
GERBER
FAMILY IRREVOCABLE TRUST
__________________________
By:
Its:
[signature page to Stock Purchase
Agreement]
__________________________
Xxxxxx
Xxxxxx
__________________________
Xxxxxxx
Xxxxxx
[signature page to Stock Purchase
Agreement]
__________________________
Xxxxx
Xxxxxx
__________________________
Xxxxxx
Xxxxxx
[signature page to Stock Purchase
Agreement]
XXXXXXXXXXXX
FAMILY TRUST
__________________________
By:
Its:
[signature page to Stock Purchase
Agreement]
XXX-XXXX
FAMILY TRUST
__________________________
By:
Its:
[signature page to Stock Purchase
Agreement]
__________________________
Xxxxxx
Xxxxxx
__________________________
Xxxxx
Xxxx-Xxxxxx
[signature page to Stock Purchase
Agreement]
EXHIBIT
A
FUNDS
1.
United States Oil
Fund, LP
2.
United States
Natural Gas Fund, LP
3.
United States 12
Month Oil Fund, LP
4.
United States
Gasoline Fund, LP
5.
United States
Diesel-Heating Oil Fund, LP
6.
United States
Diesel-Heating Oil Fund, LP
7.
United States Short
Oil Fund, LP
8.
United States 12
Month Natural Gas Fund, LP
9.
United States Xxxxx
Oil Fund, LP
10.
United States
Commodity Index Fund
11.
United States
Copper Index Fund
12.
United States
Agriculture Index Fund
13.
United States
Canadian Crude Oil Index Fund
14.
XXX USCF MLP Index
Fund
15.
XXX S&P MLP
Inverse Fund
16.
Stock Split Index
Fund
17.
USCF INDXX
Restaurant Leaders ETF
18.
USCF Dynamic
Commodity Index ETF
19.
United States
Commodity Index Funds Trust
20.
USCF Funds
Trust
21.
USCF ETF
Trust
22.
USCF Mutual Funds
Trust
EXHIBIT
B
XXXXXXXXXX SHARES; PRO RATA PERCENTAGES;
INDEMNIFICATION PERCENTAGES AND CONCIERGE
SHARES
[INFORMATION REDACTED]
Concierge
Technologies, Inc. agrees that copies of the Concierge Disclosure
Letter and the Xxxxxxxxxx Disclosure Letter will be furnished
supplementally to the Commission upon request.
