Stock Purchase Agreement among Xedar Corporation and Atlantic Systems Corporation, a Virginia corporation and Don W. Rakestraw, Jeffrey R. Grime, and J.O. McFalls, III Constituting All of The Shareholders of Atlantic Systems Corporation, a Virginia...
among
and
Atlantic
Systems Corporation,
a
Virginia corporation
and
Constituting
All of The Shareholders of
Atlantic
Systems Corporation,
a
Virginia corporation
Effective
as of March
22, 2007
This
Stock Purchase Agreement (this "Agreement")
is
entered into effective as of March 22,
2007,
(the "Effective
Date"),
by
and among Xedar Corporation., a Colorado corporation
("Buyer"),
Xxx
X. Xxxxxxxxx, Xxxxxxx X. Xxxxx, and X.X. XxXxxxx, III (each individually a
"Shareholder"
and
collectively the "Shareholders"),
constituting all of the Shareholders of Atlantic Systems Corporation, a Virginia
corporation (the "Company"),
and
the Company.
RECITALS
A. Xxx
X.
Xxxxxxxxx owns 23,000
shares of the common stock of the Company ("Shares"),
Xxxxxxx X. Xxxxx owns 17,000 Shares, and X.X. XxXxxxx, III owns 4,444 Shares,
and together the Shareholders own one hundred percent (100%) of the issued
and
outstanding capital stock of the Company.
B. The
Shareholders desire and intend to sell the Shares, constituting 100% of the
issued and outstanding capital stock of the Company, to Buyer at the price
and
on the terms and subject to the conditions set forth below.
C. Buyer
desires and intends to purchase the Shares, constituting 100% of the issued
and
outstanding capital stock of the Company, from the Shareholders at the price
and
on the terms and subject to the conditions set forth below.
AGREEMENT
In
consideration of the terms hereof, the parties agree as follows:
ARTICLE
I - DEFINITIONS
1.1
Definitions
Capitalized
terms shall have the meanings set forth herein.
ARTICLE
II - PURCHASE AND SALE OF SHARES
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2.1
|
Purchase
and Sale of Shares
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On
the
terms and subject to the conditions of this Agreement, Buyer agrees to purchase
the Shares, constituting 100% of the issued and outstanding capital stock of
the
Company, from the Shareholders, and the Shareholders agree to sell the Shares,
constituting 100% of the issued and outstanding capital stock of the Company,
to
Buyer. Schedule
2.1
lists
personal items owned by the Sellers, which items are excluded from the sale
hereunder, but may be located on the business premises of the
Company.
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2.2
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Consideration
for Shares
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The
aggregate purchase price (the "Purchase
Price")
for
the Shares shall be payable in two installments:
(a) The
first
installment (the "Closing
Payment")
shall
consist of three million (3,000,000) shares, no par value per share, of the
common stock (the "Stock")
of
Buyer, payable as set forth in Section 2.2.1.
(b) The
second installment (the "Post
Closing Payment")
shall
consist of that number of shares of Stock equal to five million one hundred
eight thousand six hundred ninety six dollars ($5,108,696) worth of Stock,
valued at a price per share ("Post
Closing Payment Price Per Share")
equal
to the average closing price of the Stock, as quoted on the OTC Bulletin Board,
for the 10 days before and 10 days after such Stock is registered pursuant
to a
registration statement declared effective by the United States Securities and
Exchange Commission (the "SEC"),
payable as set forth in Section 2.2.1.
Unless
and until the Stock is registered, all Stock constituting a portion of the
Purchase Price shall be "restricted stock" as that term is define in Rule 144
promulgated under the Securities Act of 1933, as amended (the "Act").
2.2.1 Payment
(a) First
installment: At Closing (as defined below) Buyer shall pay the Closing Payment
by directing its transfer agent, Computershare Trust Company, Inc. (the
"Transfer
Agent"),
to
(a) issue to Xxx X. Xxxxxxxxx 1,554,000 shares of Stock; (b) issue to Xxxxxxx X.
Xxxxx 1,146,000 shares of Stock; and (c) issue to X.X. XxXxxxx, III 300,000
shares of Stock.
(b) Second
Installment: Not later than five (5) days after the determination of Post
Closing Payment Price Per Share, Buyer shall pay the Post Closing Payment by
directing its Transfer Agent to issue to each Xxx X. Xxxxxxxxx and Xxxxxxx
X.
Xxxxx their pro rata share (in accordance with their percentage ownership of
the
issued and outstanding capital stock of the Company) of the number of shares
of
Stock required to be issued by Buyer pursuant to Section 2.2(b) hereof.
2.2.2 Registration
Rights and Lock-Up Agreement; Adjustment
to Purchase Price
(a) At
or
prior to Closing, Xxx X. Xxxxxxxxx, Xxxxxxx X. Xxxxx, and X.X. XxXxxxx, III
shall each execute a registration rights and lock-up agreement ("Registration
and Lock-Up Agreement")
in
substantially the form attached hereto as Exhibit
2.2.2.
The
Registration and Lock-Up Agreement, shall provide, among other things, that
Buyer shall use its best commercial efforts to file, with the SEC, a
registration statement with respect to the Stock within 90 days of the Closing
and that Buyer shall use its best commercial efforts to cause such registration
statement to be declared effective within 180 days of the Closing. The
Registration and Lock-Up Agreement shall further provide, among other things,
that the Shareholders shall be prohibited from selling the Stock for a period
of
one year after the Closing, subject to waiver by Buyer, and the following
conditions: (i) Buyer shall waive the lock-up with respect to an aggregate
of
$5,108,696 worth of Stock held by the Shareholders (on a pro rata basis)
immediately after the effective date of the registration statement pursuant
to
which the Stock is registered; (ii) Buyer shall waive the lock-up with respect
to one half of the remaining Stock held by the Shareholders on a pro rata basis
with the waiver or expiration of certain other lock up agreements to which
certain other shareholders of Buyer are subject; and (iii) Buyer shall waive
the
lock-up with respect to all remaining Stock held by the Shareholders upon:
(A)
the waiver or expiration of all other lock up agreements to which all other
shareholders of Buyer are subject; and (B) such other shareholders are afforded
a reasonable opportunity and period of time to sell their Stock. Pursuant to
the
Registration and Lock-Up Agreement, Buyer shall further covenant that it shall
include all Stock to be delivered as a portion of the Purchase Price in the
first registration statement filed by Buyer with the SEC after the Closing
Date
(as defined below). It is the intent of Buyer to file the registration statement
required to be filed pursuant to this Section 2.2.2 no later than March 31,
2007.
(b) "Actual
Net Equity"
shall
mean the Company's total assets less total liabilities (for purposes of this
definition, total assets and total liabilities shall be determined in conformity
with GAAP and in a manner consistent with that used to prepare the Financial
Statements (as defined below)). No later than the Closing Date (as defined
below), the Company shall prepare and deliver to Buyer a balance sheet (the
"Closing
Balance Sheet"),
prepared in conformity with GAAP and in a manner consistent with that used
to
prepare the Financial Statements (as defined in Section 3.6). Schedule
2.2.2(b)
sets
forth a complete and accurate list of all material accounts receivable and
accounts payable of Seller as of the date of the Closing Balance Sheet, and
the
Shareholders and the Company hereby jointly and severally represent and warrant
that each such account receivable and payable is valid, enforceable and
represents amounts due for services performed or sales actually made in the
ordinary course of business and properly reflect the amounts due or payable.
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2.3
|
Closing
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The
closing of the transactions contemplated herein (the "Closing")
shall
occur at 3:00 p.m. on Thursday, March
22,
2007, and shall be held at the
offices of Buyer, or at such other time, place and date as Buyer and the Company
shall agree (the "Closing
Date").
At
the Closing Buyer and the Shareholders shall take all such action and deliver
all such documents, instruments, certificates and other items as may be
required, under this Agreement or otherwise, in order to perform or fulfill
all
covenants, conditions and agreements on its part to be performed or fulfilled
at
or before the Closing Date and to cause all conditions precedent to the other
parties' obligations under this Agreement to be satisfied in
full.
ARTICLE
III - REPRESENTATIONS AND WARRANTIES
OF
THE SHAREHOLDERS AND THE COMPANY
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3.1
|
Shareholder
Representations
and Warranties
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To
induce
the Buyer to enter into and perform this Agreement, the Shareholders and the
Company represent and warrant to Buyer, as of the Effective Date and as of
the
Closing, as follows in this Article III.
3.1.1 Good
Title
Each
Shareholder represents with respect to itself, and the Company represents with
respect to itself and each Shareholder, as follows in this Section 3.1: Pursuant
to the Company's Articles of Incorporation, the capital stock of the Company
consists of a single class of common stock and the Company is authorized to
issued up to 100,000 shares of common stock. There are currently issued and
outstanding forty four thousand four hundred forty four (44,444) shares of
the
Company's common stock. Xxx X. Xxxxxxxxx owns 23,000 Shares, constituting fifty
one point eight percent (51.8%) of the issued and outstanding Shares of
the
Company, Xxxxxxx X. Xxxxx owns 17,000 Shares, constituting thirty eight point
two percent (38.2%) of the issued and outstanding Shares of the Company, and
X.X. XxXxxxx, III owns 4,444 Shares, constituting ten percent (10%) of the
issued and outstanding Shares of the Company; and together the Shareholders
own
one hundred percent (100%) of the issued and outstanding capital stock of the
Company. Such Shares are owned free and clear of any lien, encumbrance, adverse
claim, restriction on sale, transfer or voting (other than restrictions imposed
by applicable securities laws), preemptive right, option or other right to
purchase, and upon the consummation of the sale of such Shares as contemplated
hereby, Buyer will have good title to such Shares, free and clear of any lien,
encumbrance, adverse claim, restriction on sale, transfer or voting (other
than
restrictions imposed by applicable securities laws), preemptive right, option
or
other right to purchase.
3.1.2 Authority
Each
Shareholder has all requisite power, right and authority to enter into this
Agreement, including the exhibits and schedules hereto, and each other agreement
or document (collectively the "Transaction
Documents")
entered into in connection with this Agreement to which it is a party, to
consummate the transactions contemplated hereby and thereby, and to sell and
transfer the Shares without the consent or approval of any other person or
entity. Such Shareholder has taken, or will take prior to the Closing, all
actions necessary for the authorization, execution, delivery and performance
of
this Agreement and the other Transaction Documents.
3.1.3 Enforceability
This
Agreement has been, and the other Transaction Documents to which each
Shareholder is a party on the Closing will be, duly executed and delivered
by
such Shareholder, and this Agreement is, and each of the other Transaction
Documents to which a Shareholder is a party on the Closing will be, the legal,
valid and binding obligation of such Shareholder, enforceable against such
Shareholder in accordance with its terms.
3.1.4 No
Approvals or Notices Required; No Conflicts
The
execution, delivery and performance of this Agreement and the other Transaction
Documents by the Company and each Shareholder, and the consummation of the
transactions contemplated hereby and thereby, will not (a) constitute a
violation (with or without the giving of notice or lapse of time, or both)
of
any provision of any law or any judgment, decree, order, regulation or rule
of
any court, agency or other governmental authority applicable to the Company
or
such Shareholder, (b) require any consent, approval or authorization of, or
declaration, filing or registration with, any person or entity, (c) result
in a default (with or without the giving of notice or lapse of time, or both)
under, acceleration or termination of, or the creation in any party of the
right
to accelerate, terminate, modify or cancel, any agreement, lease, note or other
restriction, encumbrance, obligation or liability to which the Company is a
party or by which it is bound or to which any assets of the Company are subject,
or (d) result in the creation of any lien or encumbrance upon the assets
of the
Company or upon the Shares.
3.1.5 Securities
Representations
(a) Each
Shareholder is familiar with the term "accredited investor" and its use in
connection with private placements of securities under applicable U.S. federal
and state laws. Each Shareholder represents and warrants that such Shareholder
is an accredited investor as such term is defined in Rule 501(a) promulgated
under the Securities Act of 1933, as amended (the "Act").
(b) Each
Shareholder (i) is aware of the Buyer's business affairs and financial
condition, has reviewed the most recent current, quarterly, and annual reports
of Buyer filed with the SEC pursuant to the requirements of the Securities
Exchange Act of 1934 Act, as amended (the "Exchange
Act");
and
(ii) has acquired sufficient information about Buyer to reach an informed and
knowledgeable decision to acquire the Stock. Each Shareholder has such knowledge
and experience in financial and business matters as to make such Shareholder
capable of utilizing said information to evaluate the risks of the prospective
investment and to make an informed investment decision. Each Shareholder has
been furnished with all information which such Shareholder deems necessary
to
evaluate the merits and risks of the purchase of the Stock, and such Shareholder
has had the opportunity to ask questions and receive answers concerning the
Stock and Buyer from the officers and directors of Buyer, and to obtain any
additional information concerning the Stock or Buyer necessary to verify the
accuracy of the information furnished or made available to such Shareholder
in
connection herewith. Each Shareholder is able to bear the economic risk of
such
Shareholder's investment in the Stock. Each Shareholder is purchasing the Stock
for investment for his or her own account only and not with a view to, or for
resale in connection with, any "distribution" thereof within the meaning of
the
Act.
(c) Each
Shareholder understands that the Stock has not been registered under the Act
by
reason of a specific exemption therefrom, which exemption depends upon, among
other things, the bona fide nature of such Shareholder's investment intent
as
expressed herein.
(d) Each
Shareholder understands that the Stock is a "restricted security" under
applicable U.S. federal and state securities laws and that, pursuant to
these laws, each Shareholder must hold the Stock indefinitely unless and until
the Stock is registered (as required by Section 2.2.2 hereof) with the SEC
and
qualified by state authorities or an exemption from such registration and
qualification requirements is available. Each Shareholder further acknowledges
that if an exemption from registration or qualification is available, it may
be
conditioned on various requirements including, but not limited to, the time
and
manner of sale, the holding period for the Stock, and requirements relating
to
Buyer which are outside of the Shareholder's control and which the Buyer is
under no obligation to, and may not be able to, satisfy.
(e) Each
Shareholder understands that such Shareholder may suffer adverse tax
consequences as a result of such Shareholder's purchase or disposition of the
Stock. Each Shareholder represents that such Shareholder has consulted any
tax
consultants such Shareholder deems advisable in connection with the purchase
or
disposition of the Stock and that such Shareholder is not relying on Buyer
for
any tax advice.
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3.2
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Company
Organization; Good Standing; Corporate Authority;
Enforceability
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The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company is a corporation validly existing and in good standing under the laws
of
the state of Virginia. The Company is duly qualified to do business, and is
in
good standing in each state where such qualification is required due to
(a) the ownership or leasing of real or personal property for use in the
operation of the Company's business or (b) the nature of the business
conducted by the Company. The Company has all requisite power, right and
authority to own, operate and lease its properties and assets, to carry on
its
business as now conducted and as represented to Buyer by the Company to be
conducted, to execute, deliver and perform its obligations under this Agreement
and the other Transaction Documents to which it is a party, and to carry out
the
transactions contemplated hereby and thereby.
All
actions on the part of the Company and its Shareholders necessary for the
authorization, execution, delivery and performance of this Agreement and the
other Transaction Documents, the consummation of the transactions contemplated
hereby and thereby, and the performance of all of the Company's and
Shareholders' obligations under this Agreement and the other Transaction
Documents have been taken or will be taken at or prior to the Closing. This
Agreement has been, and the other Transaction Documents to which the Company
and/or a Shareholder is a party on the Closing will be, duly executed and
delivered by the Company and/or such Shareholder(s), and this Agreement is,
and
each of the other Transaction Documents to which the Company and/or a
Shareholder is a party on the Closing will be, a legal, valid and binding
obligation of the Company and such Shareholder(s), enforceable against the
Company and such Shareholder(s) in accordance with its terms.
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3.3
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Capitalization
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The
Company and each Shareholder represents and warrants to Buyer as
follows:
(a) Pursuant
to the Company's Articles of Incorporation, the capital stock of the Company
consists of a single class of common stock and the Company is authorized to
issued up to 100,000 shares of common stock. There are currently issued and
outstanding forty four thousand for hundred forty four (44,444) shares of the
Company's common stock.
(b) Xxx
X.
Xxxxxxxxx owns 23,000 Shares, constituting fifty one point eight percent (51.8%)
of the issued and outstanding Shares of
the
Company, Xxxxxxx X. Xxxxx owns 17,000 Shares, constituting thirty eight point
two percent (38.2%) of the issued and outstanding Shares of the Company, and
X.X. XxXxxxx, III owns 4,444 Shares, constituting ten percent (10%) of the
issued and outstanding Shares of the Company; and together the Shareholders
own
one hundred percent (100%) of the issued and outstanding capital stock of the
Company. Except for the Shareholders, who together hold one hundred percent
(100%) of the issued and outstanding capital stock of the Company, no person
or
entity holds any interest in or to any capital stock of the
Company.
(c) There
are
no outstanding rights of first refusal, preemptive rights, options, warrants,
conversion rights or other agreements, either directly or indirectly, for the
purchase or acquisition from the Company of any capital stock or other rights
(economic or otherwise) of the Company.
(d) The
Company is not a party or subject to any agreement or understanding, and there
is no agreement or understanding between any person or entity, that affects
or
relates to the voting or giving of written consents with respect to any capital
stock of the Company or the voting by any Shareholder of the
Company.
(e) The
Shares are certificated and at Closing each Shareholder party hereto shall
deliver to Buyer a certificate, duly endorsed, representing the Shares owned
by
such Shareholder, such that upon Closing Buyer shall possess certificates,
duly
endorsed, representing 100% of the issued and outstanding Shares and
constituting 100% of the issued and outstanding capital stock of the
Company.-
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3.4
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Subsidiaries
and Affiliates
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The
Company and each Shareholder represents and warrants to Buyer as follows: Except
for Point One, L.L.C., a Virginia limited liability company in good standing,
and wholly owned subsidiary of the Company, the Company does not have, and
has
never had, any subsidiaries and the Company does not own, directly or
indirectly, any ownership, equity, profits or voting interest in, or otherwise
control, any corporation, partnership, limited liability company, joint venture
or other entity, and has no agreement or commitment to purchase any such
interest. Herein, references to the Company or the conduct of its business,
except as otherwise required by the context thereof, shall refer to both
Atlantic Systems Corporation, a Virginia corporation, and its wholly owned
subsidiary, Point One, L.L.C., a Virginia limited liability
company.
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3.5
|
No
Approvals or Notices Required; No
Conflicts
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
execution, delivery and performance of this Agreement and the other Transaction
Documents, and the consummation of the transactions contemplated hereby and
thereby, will not (a) constitute a violation (with or without the giving of
notice or lapse of time, or both) of any provision of any law or any judgment,
decree, order, regulation or rule of any court, agency or other governmental
authority applicable to the Company, (b) require any consent, approval or
authorization of, or declaration, filing or registration with, any person or
entity, (c) result in a default (with or without the giving of notice or
lapse of time, or both) under, acceleration or termination of, or the creation
in any party of the right to accelerate, terminate, modify or cancel, any
agreement, lease, note or other restriction, encumbrance, obligation or
liability to which the Company is a party or by which it is bound or to which
any assets of the Company are subject, (d) result in the creation of any
lien or encumbrance upon the assets of the Company, or upon any Shares or other
securities of the Company, (e) conflict with or result in a breach of or
constitute a default under any provision of the Articles
of Incorporation or Bylaws
of
the Company, or (f) invalidate or adversely affect any permit, license,
authorization or status used in the conduct of the business of the
Company.
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3.6
|
Financial
Statements; Obligations
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The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company has delivered to Buyer (a) balance sheets and statements of
operations, Shareholder' equity and cash flows of the Company at and for the
fiscal years ended 2005 and 2006,
and
accompanying notes, and (b) unaudited balance sheets and unaudited
statements of operations and cash flows of the Company at and for the one (1)
month ended January 31, 2007. All the foregoing financial statements (including
the notes thereto) are referred to as the "Financial
Statements".
The
Financial Statements have been prepared in conformity with GAAP consistently
applied throughout the periods covered, except as may be indicated in the notes
thereto, and present fairly the financial position, results of operations and
changes in financial position of the Company at the dates and for the periods
indicated, subject, in the case of the unaudited financial statements, to normal
recurring period-end adjustments. The Company has no liabilities or obligations
of any nature (absolute, accrued or contingent) that are not fully reflected
or
reserved against in the Closing Balance Sheet, as prescribed by GAAP and the
Financial Accounting Standards Board, except liabilities or obligations incurred
since the date of the Closing Balance Sheet in the ordinary course of business
and consistent with past practice. The Company maintains and will continue
to
maintain standard systems of accounting established and administered in
accordance with GAAP. The Company is not a guarantor, indemnitor, surety or
other obligor of any indebtedness of any other person or entity. Disclosure
Schedule 3.6
sets
forth all promissory notes, loans, lines of credits or similar obligations
pursuant to which the Company is an obligor, together with all the amounts
owed
by the Company under such obligations, as of the Closing, and all liabilities
under real property and equipment leases of the Company (the "Operating
Liabilities").
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3.7
|
Absence
of Certain Changes or
Events
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The
Company and each Shareholder represents and warrants to Buyer as follows: Except
(a) as and to the extent reflected or reserved against in the Closing
Balance Sheet and (b) for liabilities and obligations incurred in the
ordinary course of business since the Closing Balance Sheet, which are not
material in amount, there are no liabilities or obligations of any nature
relating to the Company, due or to become due, known or unknown, accrued,
absolute, contingent or otherwise, that would be required to be included in
a
balance sheet prepared in accordance with GAAP. The Company has not entered
into
or agreed to enter into any transaction, agreement or commitment, suffered
the
occurrence of any event or events or experienced any change in financial
condition, business, results of operations or otherwise that, in the aggregate,
has (i) interfered with the normal and usual operations of the business or
business prospects of the business or (ii) resulted in a material adverse
change in the business, assets, operations, prospects or condition (financial
or
other) or could reasonably be expected to have such material adverse
effect.
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3.8
|
Taxes
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The
Company and each Shareholder represents and warrants to Buyer as follows:
(a) For
purposes of this Agreement, the term "Taxes,"
means
(i) any and all federal, state, local and foreign taxes, assessments and
other governmental charges, duties, impositions and liabilities, including,
without limitation, taxes based upon or measured by gross receipts, income,
profits, sales, use and occupation, and value added, ad valorem, transfer,
franchise, withholding, payroll, recapture, employment, excise and property
taxes, together with all interest, penalties and additions imposed with respect
to such amounts; (ii) any liability for the payment of any amounts of the
type described in clause (i) as a result of being or ceasing to be a member
of an affiliated, consolidated, combined or unitary group for any period
(including, without limitation, any liability under Treasury Regulation
Section 1.1502-6 or any comparable provision of foreign, state or local
law); and (iii) any liability for the payment of any amounts of the type
described in clause (i) or (ii) as a result of any express or implied
obligation to indemnify any other Person or as a result of any obligations
under
any agreements or arrangements with any other Person with respect to such
amounts and including any liability for taxes of a predecessor entity; and
the
term "Tax" means any one of the foregoing Taxes.
(b) The
Company has filed on a timely basis all reports, returns, declarations, claims
for refund, information returns, statements or other similar documents,
including any schedules or attachments thereto, and including any amendment
thereof with respect to any Taxes ("Tax
Returns")
that
the Company was required to file. All such Tax Returns were correct and complete
in all respects and have been prepared and completed in accordance with
applicable law, including all and were prepared in accordance with the
applicable statutes, rules and regulations. No such Tax Returns are currently
the subject of audit or examination nor has the Company been notified in
writing, or otherwise, of any request for an audit or examination. All Taxes
owed by the Company (whether or not shown on any Tax Return) were paid in full
when due or are being contested in good faith and are supported by adequate
reserves on the Financial Statements. The Company has provided adequate reserves
on its Financial Statements for the payment of any Taxes accrued but not yet
due
and payable. The Company is not currently the beneficiary of any extension
of
time within which to file any Tax Return, and the Company has not waived any
statute of limitations in respect of Taxes or agreed to any extension of time
with respect to any Tax assessment or deficiency. The Company has duly and
timely withheld from employee salaries, or wages or other compensation (whether
or not paid in cash) and other amounts paid to creditors, independent
contractors and other third parties and paid over to the appropriate
governmental authority all amounts required to be so withheld and paid over
for
all periods under all applicable Tax or other laws. No amounts have been or
would be required to be withheld with respect to the lapse of restrictions
on
the Shares. The Tax Returns of the Company do not contain a disclosure under
Section 6662 of the Internal Revenue Code of 1986, as amended (the
"Code")
(or
any predecessor provision or comparable provision of state, local or foreign
law). The Company does not do business in or derive income from any state,
local
or foreign jurisdiction other than those jurisdictions for which Tax Returns
have been duly filed by the Company.
(c) There
is
no dispute, claim or proposed adjustment concerning any Tax liability of the
Company either (A) claimed or raised by any authority in writing or
(B) based upon personal contact with any agent of such authority. The
Company is not a party to nor has it been notified in writing or, otherwise,
that it is the subject of any pending, proposed or threatened action,
investigation, proceeding, audit, claim or assessment by or before the IRS
or
any other governmental authority, and no claim for assessment, deficiency or
collection of Taxes, or proposed assessment, deficiency or collection from
the
IRS or any other governmental authority which has not been satisfied, nor does
the Company have any reason to believe that any such notice will be received
in
the future. The IRS has never audited any Tax Return of the Company. The Company
has not filed any requests for rulings with the IRS. No power of attorney has
been granted by the Company, its Shareholders or their affiliates with respect
to any matter relating to Taxes of the Company. There are no Tax liens of any
kind upon any property or assets of the Company, except for inchoate liens
for
Taxes not yet due and payable.
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3.9
|
Property
|
The
Company and each Shareholder represents and warrants to Buyer as follows:
(a) Disclosure
Schedule 3.9(a)
contains
a complete and accurate list of all real property that is owned, leased, rented
or used by the Company (the "Real
Property").
The
Company has delivered to Buyer true and complete copies of all leases,
subleases, rental agreements, contracts of sale, tenancies or licenses relating
to the Real Property.
(b) Disclosure
Schedule 3.9(b) contains a complete and accurate list of each item of
personal property having a book value in excess of $2,000 that is owned, leased,
rented or used by the Company (the "Personal
Property");
and
the Company has delivered to Buyer true and complete copies of all leases,
subleases, rental agreements, contracts of sale, tenancies or licenses relating
to the Personal Property.
(c) The
Real
Property and the Personal Property include all properties and assets (whether
real, personal or mixed, tangible or intangible) reflected in the Balance Sheet
and all the properties and assets purchased by the Company since the date of
the
Balance Sheet (except for such properties or assets sold since the date of
the
Balance Sheet in the ordinary course of business and consistent with past
practice). The Real Property and the Personal Property include all property
used
in the business of the Company.
(d) The
Company's title to or leasehold interest in, as applicable, each parcel of
the
Real Property is free and clear of all liens, mortgages, pledges, deeds of
trust, security interests, charges, encumbrances, institutional controls and
other adverse claims or interests of any kind.
(e) The
Company's offices, manufacturing and production facilities and other structures
and the Company's Personal Property are adequate for the uses to which they
are
being put and there are no applicable adverse zoning, building or land use
codes
or rules, ordinances, regulations or other restrictions relating to zoning
or
land use that currently or may prospectively prevent, or cause the imposition
of
material fines or penalties as the result of, the use of all or any portion
of
the Real Property for the conduct of the business as presently conducted. The
Company has received all necessary approvals with regard to occupancy and
maintenance of the Real Property.
(g) Each
lease of any portion of the Real Property and each lease, license, rental
agreement, contract of sale or other agreement to which the Personal Property
is
subject is valid, binding and enforceable in accordance with its terms against
the parties thereto; the Company has performed all obligations imposed upon
it
thereunder; and the Company is not in default thereunder, nor is there any
event
that with notice or lapse of time, or both, would constitute a default
thereunder. No consent is required from any Person under any lease or other
agreement or instrument relating to the Real Property or Personal Property
in
connection with the consummation of the transactions contemplated by this
Agreement, and the Company has not received notice that any party to any such
lease or other agreement or instrument intends to cancel, terminate or refuse
to
renew the same or to exercise or decline to exercise any option or other right
thereunder. The Company has not granted any lease, sublease, tenancy or license
of any portion of the Real Property or Personal Property.
|
3.10
|
Contracts
|
The
Company and each Shareholder represents and warrants to Buyer as follows:
Disclosure Schedule
3.10
contains
a complete and accurate list as of all material contracts, agreements,
arrangements and understandings, oral or written, to which the Company is a
party or by which the Company is bound, including, without limitation, all
security agreements, intellectual property licenses and other license
agreements, credit agreements, instruments relating to the borrowing of money,
purchase contracts, sale contracts, research contracts and scientific
collaboration or cooperation agreements. All such material contracts set forth
on such Schedule 3.10
are
valid, binding and enforceable in accordance with their terms against each
party
thereto and are in full force and effect; the Company has performed all
obligations imposed upon it thereunder; and the Company is not in default
thereunder; nor is there any event that with notice or lapse of time, or both,
would constitute a default thereunder. Furthermore, no breach or default by
any
other party to any such contract of any provision thereof, nor any condition
or
event that, with notice or lapse of time or both, would constitute such a breach
or default, has occurred. True and complete copies of each such contract have
been delivered to Buyer. No consent is required from any person or entity under
any contract, agreement, arrangement or understanding set forth on Disclosure
Schedule 3.10
in
connection with the consummation of the transactions contemplated by this
Agreement, and the Company has not received notice, and is not otherwise aware,
that any party to any such contract, agreement, arrangement or understanding
intends to cancel, terminate or refuse to renew such contract, agreement,
arrangement or understanding or to exercise or decline to exercise any option
or
right thereunder.
|
3.11
|
Customers
and Suppliers
|
The
Company and each Shareholder represents and warrants to Buyer as follows:
Disclosure Schedule 3.11
sets
forth: (a) a complete and accurate list of the customers of the Company
accounting for 2% or more of the Company's revenues during the last fiscal
year
and (b) a complete and accurate list of the suppliers of the Company from
whom the Company has purchased 5% or more of the goods or services purchased
by
the Company in the last fiscal year. The Company has not received any notice
from its customers or suppliers that would cause it, in its reasonable judgment,
to expect any material modification to its relationship with any customers
or
suppliers named on such Schedule 3.11.
|
3.12
|
Claims
and Legal Proceedings
|
Except
as
disclosed on
Schedule 3.12,
the
Company and each Shareholder represents and warrants to Buyer as follows: There
are no claims, actions, suits, arbitrations, criminal or civil investigations
or
proceedings pending or involving or, to the knowledge of the Shareholder,
threatened against the Company before or by any court or governmental or
nongovernmental department, commission, board, bureau, agency or
instrumentality, or any other Person. To the knowledge of the Shareholder,
there
is no valid basis for any claim, action, suit, arbitration, investigation or
proceeding that could reasonably be expected to be materially adverse to the
business, assets, operations, prospects or condition (financial or other) of
the
Company before or by any person or entity. There are no outstanding or
unsatisfied judgments, orders, decrees or stipulations to which the Company
is a
party that involve the transactions contemplated herein or that would have
a
material adverse effect on the business, assets, operations, prospects or
condition (financial or other) of the Company.
3.11 Intentionally
Omitted
|
3.14
|
Labor
Matters
|
The
Company and each Shareholder represents and warrants to Buyer as follows: There
are no labor disputes, employee grievances or disciplinary actions pending
or,
to the knowledge of the Shareholder, threatened against or involving the Company
or any present or former employee of the Company. The Company has complied
with
all provisions of law relating to employment and employment practices, terms
and
conditions of employment, wages and hours including, without limitation, equal
opportunity, workplace safety, workers' compensation and other similar laws.
The
Company is not engaged in any unfair labor practice and does not have any
liability for any arrears of wages or Taxes or penalties for failure to comply
with any such provisions of law. There is no labor strike, dispute, slowdown
or
stoppage pending or threatened against or affecting the Company, and the Company
has not experienced any work stoppage or similar concerted employee activities.
No collective bargaining agreement is binding on the Company. The Company does
not have any knowledge of any organizational efforts presently being made or
threatened by or on behalf of any labor union with respect to employees of
the
Company, and the Company has not been requested by any group of employees or
others to enter into any collective bargaining agreement or other agreement
with
any labor union or other employee organization.
|
3.15
|
Employee
Benefit Plans
|
The
Company and each Shareholder represents and warrants to Buyer as follows:
(a) Employee
Benefit Plan Listing.
Disclosure Schedule 3.15
contains
a complete and accurate list of all benefit plans and arrangements
("Employee
Benefit Plans").
The
Company does not have any agreement, arrangement, commitment or obligation,
whether formal or informal, whether written or unwritten and whether legally
binding or not, to create, enter into or contribute to any additional Employee
Benefit Plan, or to modify or amend any existing Employee Benefit Plan. There
has been no amendment, interpretation or other announcement (written or oral)
by
the Company or any other Person relating to, or change in participation or
coverage under, any Employee Benefit Plan that, either alone or together with
other such items or events, could Materially increase the expense of maintaining
such Employee Benefit Plan (or the Employee Benefit Plans taken as a whole)
above the level of expense incurred with respect thereto for the most recent
fiscal year included in the Financial Statements. The terms of each Employee
Benefit Plan permit the Company to amend or terminate such Employee Benefit
Plan
at any time and for any reason without penalty and without Material liability
or
expense. None of the rights of the Company under any Employee Benefit Plan
will
be impaired in any way by this Agreement or the consummation of the transactions
contemplated by this Agreement.
(b) Intentionally
Omitted.
(c) Compliance.
With
respect to each Employee Benefit Plan: (i) such Employee Benefit Plan is,
and at all times since inception has been, maintained, administered, operated
and funded in all respects in accordance with its terms and in compliance with
all applicable requirements of all applicable laws, statutes, orders, rules
and
regulations, including, without limitation, ERISA, COBRA, HIPAA and the Code;
(ii) the Company and all other persons or entities (including, without
limitation, all fiduciaries) have, at all times, properly performed all of
their
duties and obligations (whether arising by operation of law or by contract)
under or with respect to such Employee Benefit Plan, including, without
limitation, all reporting, disclosure and notification obligations;
(iii) all Returns and other information relating to such Employee Benefit
Plan required to be filed with any governmental entity or agency have been
accurately completed and timely and properly filed; (iv) all notices,
statements, reports and other disclosure (including, without limitation, all
summary plan descriptions and summaries of material modifications) required
to
be given or made to participants in such Employee Benefit Plan or their
beneficiaries have been accurately completed and timely and properly disclosed
or provided; (v) neither the Company nor any fiduciary of such Employee
Benefit Plan has engaged in any transaction or acted or failed to act in a
manner that violates the fiduciary requirements of ERISA or any other applicable
law; (vi) no transaction or event has occurred or is threatened or about to
occur (including any of the transactions contemplated in or by this Agreement)
that constitutes or could constitute a prohibited transaction under
Section 406 or 407 of ERISA or under Section 4975 of the Code for
which an exemption is not available; and (vii) the Company has not
incurred, and there exists no condition or set of circumstances in connection
with which the Company or Buyer could incur, directly or indirectly, any
Material liability or expense (except for routine contributions and benefit
payments) under ERISA, the Code or any other applicable law, statute, order,
rule or regulation, or pursuant to any indemnification or similar agreement,
with respect to such Employee Benefit Plan.
(e) Contributions,
Premiums and Other Payments.
All
contributions, premiums and other payments due or required to be paid to (or
with respect to) each Employee Benefit Plan have been timely paid, or, if not
yet due, have been accrued as a liability on the Financial Statements. All
income taxes and wage taxes that are required by law to be withheld from
benefits derived under the Employee Benefit Plans have been properly withheld
and remitted to the proper depository.
(f) Post-Employment
Benefits.
Neither
the Company nor any Employee Benefit Plan provides or has any obligation to
provide (or contribute toward the cost of) post-employment or post-termination
benefits of any kind, including, without limitation, death and medical benefits,
with respect to any current or former Shareholder, employee, agent, or
independent contractor of the Company, other than (i) continuation coverage
mandated by Sections 601 through 608 of ERISA and Section 4980B(f) of
the Code, (ii) retirement benefits under any Employee Benefit Plan that is
qualified under Section 401(a) of the Code, and (iii) deferred
compensation that is accrued as a current liability on the Financial
Statements.
(g) Suits,
Claims and Investigations.
There
are no actions, suits or claims (other than routine claims for benefits) pending
or, to the knowledge of the Shareholders, threatened with respect to (or against
the assets of) any Employee Benefit Plan, nor, to the knowledge of the
Shareholders is there a basis for any such action, suit or claim. No Employee
Benefit Plan is currently under investigation, audit or review, directly or
indirectly, by the IRS, the DOL or any other governmental entity or agency,
and,
to the knowledge of the Shareholders, no such action is contemplated or under
consideration by the IRS, the DOL or any other governmental entity or
agency.
(h) Effect
of Transaction.
Neither
the execution and delivery of this Agreement nor the consummation of the
transactions contemplated by this Agreement, will (i) entitle any
individual to severance pay, unemployment compensation or any other payment
from
the Company, Buyer or any Employee Benefit Plan, (ii) otherwise increase
the amount of compensation due to any individual or forgive indebtedness owed
by
any individual, (iii) result in any benefit or right becoming established
or increased, or accelerate the time of payment or vesting of any benefit,
under
any Employee Benefit Plan, (iv) require the Company or Buyer to transfer or
set aside any assets to fund or otherwise provide for any benefits for any
individual, and (v) all Employee Benefit Plans in effect prior to the Closing
shall be terminated or otherwise discontinued such that Buyer shall have no
obligation to contribute, maintain, transfer or set aside any assets to fund
or
otherwise provide for any benefits for any individual under any such Employee
Benefit Plan.
|
3.16
|
Intentionally
Omitted
|
|
3.17
|
Intellectual
Property
|
The
Company and each Shareholder represents and warrants to Buyer as
follows:
3.17.1 Technology
Except
for the Third Party Technologies (as defined in Section 3.17.2), the
Company owns all right, title and interest in and to the following
(collectively, the "Technology"),
free
and clear of all Encumbrances: (a) all products, computer programs,
specifications, source code, object code, graphics, devices, techniques,
algorithms, methods, technology, processes, procedures, packaging, trade dress,
formulae, drawings, designs, concepts, user interfaces, "look and feel,"
software or development tools and content that are now or during the two (2)
years prior to the date of this Agreement have been, or are currently proposed
to be, developed, produced, used, marketed and/or sold in the Company's
business; (b) any and all updates, enhancements, corrections,
modifications, improvements and new releases related to the items set forth
in
(a), above; (c) any and all technology and work in progress related to the
items set forth in (a) and (b), above; and (d) all inventions, discoveries,
processes, designs, trade secrets, know-how and other confidential or
proprietary information related to the items set forth in (a), (b) and (c),
above. The Technology, excluding the Third Party Technologies, is sometimes
referred to as the "Company
Technology."
3.17.2 Third
Party Technology
Disclosure
Schedule 3.17.2
sets
forth a list of all Technology used in the Company's business for which the
Company does not own all right, title and interest (collectively, the
"Third
Party Technologies"),
and
all license agreements or other contracts pursuant to which the Company has
the
right to use (in the manner used by the Company, or intended or necessary for
use with the Company Technology) the Third Party Technologies (the "Third
Party Licenses"),
indicating, with respect to each of the Third Party Technologies listed, the
owner and the Third Party License. The Company has the lawful right to use
(free
of any material restriction) (a) all Third Party Technology that is
incorporated in or used in the development or production of the Company
Technology, and (b) all other Third Party Technology necessary for the
conduct of the Company's business as now conducted and as proposed to be
conducted. All Third Party Licenses are valid, binding and in full force and
effect, the Company and, to the knowledge of the Shareholders, each other party
thereto have performed in all material respects their obligations thereunder,
and neither the Company nor, to the knowledge of the Shareholders, any other
party thereto is in default thereunder, nor, to the knowledge of the
Shareholders, has there occurred any event or circumstance which with notice
or
lapse of time or both would constitute a default or event of default, on the
part of the Company or, to the knowledge of the Shareholders, any other party
thereto or give to any other party thereto the right to terminate or modify
any
Third Party License. The Company has not received notice that any party to
any
Third Party License intends to cancel, terminate or refuse to renew (if
renewable) such Third Party License or to exercise or decline to exercise any
option or right thereunder.
3.17.3 Trademarks
Disclosure
Schedule 3.17.3
list(s)
all trademarks, trade names, brand names, service marks, logos or other
identifiers used by the Company in its business (the "Marks").
The
Company has full legal and beneficial ownership, free and clear of any
Encumbrances, of all rights conferred by use of the Marks in the Company's
business and, as to those Marks that have been registered in the United States
Patent and Trademark Office, by federal registration of the Marks.
3.17.4 Intellectual
Property Rights
Disclosure
Schedule 3.17.4
sets
forth all patents, patent applications, copyright registrations (and
applications therefore) and trademark registrations (and applications therefore)
(collectively, the "IP
Registrations")
associated with the Company Technology and the Marks. The Company owns all
right, title and interest, free and clear of any Encumbrances, in and to the
IP
Registrations, together with any other rights in or to any copyrights
(registered or unregistered), rights in the Marks (registered or unregistered),
trade secret rights and other intellectual property rights (including, without
limitation, rights of enforcement) associated with the Company Technology and
the Marks (collectively, the "IP
Rights").
3.17.5 Maintenance
of Rights
The
Company has not conducted its business, and has not used or enforced (or failed
to use or enforce) the IP Rights, in a manner that would result in the
abandonment, cancellation or unenforceability of any item of the IP Rights
or
the IP Registrations, and the Company has not taken (or failed to take) any
action that would result in the forfeiture or relinquishment of any IP Rights
or
IP Registrations. The Company has not granted to any third party any rights
or
permissions to use any of the Technology or the IP Rights. To the knowledge
of
the Shareholders, except pursuant to reasonably prudent safeguards, (a) no
third party has received any confidential information relating to the Technology
or the IP Rights and (b) the Company is not under any contractual or other
obligation to disclose to any third party any Company Technology.
3.17.6 Third
Party Infringement
The
Company has not received any notice or claim (whether written, oral or
otherwise) challenging the Company's ownership or rights in the Company
Technology or the IP Rights or claiming that any other person or entity has
any
legal or beneficial ownership with respect thereto; all IP Rights are legally
valid and enforceable without any material qualification, limitation or
restriction on their use, and the Company has not received any notice or claim
(whether written, oral or otherwise) challenging the validity or enforceability
of any IP Rights; and to the knowledge of the Shareholders, no other person
or
entity is infringing or misappropriating any part of the IP Rights or otherwise
making any unauthorized use of the Company Technology.
3.17.7 Infringement
by the Company
The
use
of any of the Technology in the Company's business does not and will
not,
to
the
knowledge of the Shareholders, conflict with, infringe, violate or interfere
with or constitute an appropriation of any right, title or interest (including,
without limitation, any patent, copyright or trade secret right) held by any
other person or entity, and there have been no claims made with respect thereto;
the use of any of the Marks and other IP Rights in the Company's business will
not conflict with, infringe, violate or interfere with or constitute an
appropriation of any right, title or interest (including, without limitation,
any patent, copyright, trademark or trade secret right) held by any other person
or entity, and there have been no claims made with respect thereto; and the
Company has not received any notice or claim (whether written, oral or
otherwise) regarding any infringement, misappropriation, misuse, abuse or other
interference with any third party intellectual property or proprietary rights
(including, without limitation, infringement of any patent, copyright, trademark
or trade secret right of any third party) by the Company, the Technology or
the
Marks or other IP Rights or claiming that any other entity has any claim of
infringement with respect thereto.
3.17.8 Domain
Names
Disclosure
Schedule 3.17.8
lists
all Internet domain names used by the Company in its business (collectively,
the
"Domain
Names").
The
Company has a valid registration and all material rights (free of any material
restriction) in and to the Domain Names, including without limitation all rights
necessary to continue to conduct the Company's business as it is currently
conducted.
3.17.9 Indemnification
The
Company has not entered into any agreement or offered to indemnify any person
or
entity against any charge of infringement by the Technology or IP Rights, or
any
other intellectual property or right. The Company has not entered into any
agreement granting any Person the right to bring any infringement action with
respect to, or otherwise to enforce, any of the Technology or IP
Rights.
|
3.18
|
Accounts
Receivable
|
The
Company and each Shareholder represents and warrants to Buyer as follows: All
accounts receivable of the Company reflected on Schedule
2.2.2(b)
and
existing at the time of Closing ("Accounts")
represent amounts due for services performed or sales actually made in the
ordinary course of business and properly reflect the amounts due. The bad debt
reserves and allowances reflected in the Balance Sheet are adequate. All
Accounts existing and remaining unpaid at the time of Closing will be
collectible by and accrue to the benefit of Buyer. All Accounts for services
performed, rendered, contracted, due or sales actually made after the Closing
will be collectible by and accrue to the benefit of Buyer.
|
3.19
|
Corporate
Books and Records
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company has furnished to Buyer true and complete copies of the corporate records
of the Company since the Company's inception, and such records (including
minutes, resolutions and consents, if any) accurately reflect the events of
and
actions taken at the meetings of the Shareholders and board of directors of
the
Company. The stock transfer records accurately reflect all issuances and
transfers of the capital stock of the Company since its inception.
|
3.20
|
Licenses,
Permits, Authorizations,
etc.
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company has received all required governmental approvals, authorizations,
consents, licenses, orders, registrations and permits of all agencies, whether
federal, state, local or foreign (the "Permits"),
the
failure to obtain of which would have a material adverse effect on its business,
assets, operations, prospects or condition (financial or other) of the Company.
Disclosure Schedule 3.20
contains
a list of all Permits with expiration dates, if any. The Company is in
compliance with the terms of all Permits, and all Permits are valid and in
full
force and effect, and no proceeding is pending or, to the knowledge of the
Shareholder, threatened, the object of which is to revoke, limit or otherwise
affect any Permit. The Company has not received any notifications of any
asserted failure to obtain any Permit.
|
3.21
|
Compliance
With Laws; Environmental Health and Safety
Matters
|
The
Company and each Shareholder represents and warrants to Buyer as
follows:
(a) The
Company is and has been in compliance with all federal, state, local and foreign
laws, rules, regulations, ordinances, decrees and orders applicable to the
operation of its business, to its employees, or to its property, including,
without limitation, all such laws, rules, ordinances, decrees and orders
relating to antitrust, consumer protection, currency exchange, environmental
protection, equal opportunity, health, occupational safety, good laboratory
practices, pension, securities and trading-with-the-enemy matters. The Company
has not received any notification of any asserted present or past unremedied
failure by the Company to comply with any of such laws, rules, ordinances,
decrees or orders.
(b) The
Company is not in violation of, and has not violated, in connection with the
ownership, use, maintenance or operation of the Real Property or the Personal
Property or the conduct of its business, any applicable foreign, federal, state,
county and local statutes, laws, regulations, guidances, rules, ordinances,
codes, licenses, permits, judgments, writs, decrees, injunctions or orders
of
any governmental entity relating to environmental (air, water, groundwater,
soil, natural resource, noise and odor) matters, including, by way of
illustration and not by way of limitation, the Clean Air Act, 42 U.S.C.
Section 7401, et
seq.,
as
amended; the Federal Water Pollution Control Act, 33 U.S.C. Section 1251,
et
seq.,
as
amended; the Resource Conservation and Recovery Act of 1976, 42 U.S.C.
Section 6901, et
seq.,
as
amended; the Comprehensive Environmental, Response, Compensation, and Liability
Act of 1980, 42 U.S.C. Section 9601, et
seq.,
as
amended; the Toxic Substances Control Act, 15 U.S.C. Section 2601,
et
seq.,
as
amended; the Oil Pollution Act of 1990, 33 U.S.C. Section 2701,
et seq.;
and
other comparable federal, state and local laws, and the regulations issued
thereunder (collectively, "Environmental
Laws").
(c) The
Company has not transported, stored, treated, recycled, handled or disposed
of,
or allowed or arranged for any third party to transport, store, treat, recycle,
handle or dispose of (i) any flammable substances, explosives, radioactive
materials, hazardous substances, hazardous wastes, toxic substances, pollutants,
contaminants or any wastes, materials or substances identified in or regulated
by any Environmental Laws; (ii) asbestos, polychlorinated biphenyls, urea
formaldehyde, nuclear fuel or material, chemical waste, carcinogens and radon,
all to the extent regulated by any Environmental Laws; and (iii) gasoline,
oil and other petroleum products (all of the foregoing collectively,
"Regulated
Substances"),
to or
at any location in violation of any Environmental Laws.
(d) No
part
of the Real Property, including, but not limited to, all surface and subsurface
soil, sediments, groundwater and surface water located on, in or under the
Real
Property, was or is contaminated with any Regulated Substances or constituents
thereof, which contamination has given or may give rise to any obligation of
the
Company under any applicable Environmental Laws, the common law or otherwise.
To
the knowledge of the Shareholders, no real property adjacent to or adjoining
the
Real Property has been or is being so contaminated.
(e) The
Company has reported, recorded or filed, and has provided to Buyer, true,
accurate and complete copies of all reports with respect to any spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping,
migrating, leaching, dumping or disposing into the environment (including the
abandonment or discarding of drums, barrels, containers or other closed
receptacles) (any of the foregoing, a "Release"),
required by applicable Environmental Laws to be reported by the Company to
any
government authority. The Company has maintained all environmental and operating
documents and records in the manner and for the time periods required by
applicable Environmental Laws.
(f) The
Company has not caused or permitted the Release of any Regulated Substances
or
constituents thereof on, from or off-site of its Real Property, or of any
Release from any facility owned or operated by third parties but with respect
to
which the Company is alleged to have liability, including, but not limited
to,
liability for personal injury, cleanup or restoration, which Release caused
or
could reasonably be Expected to cause a material loss to the
Company.
|
3.22
|
Insurance
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company maintains (a) insurance on all of its property (including leased
premises) that insures against loss or damage by fire or other casualty
(including extended coverage) and (b) insurance against liabilities, claims
and risks of a nature and in such amounts as are normal and customary in the
Company's industry. All insurance policies of the Company are described on
Disclosure Schedule
3.22
hereto,
and are in full force and effect, all premiums covering all periods up to and
including the Closing have been paid, and no notice of cancellation or
termination has been received with respect to any such policy or binder. Such
policies or binders are sufficient for compliance with all requirements of
law
currently applicable to the Company and of all agreements to which the Company
is a party, will remain in full force and effect through the respective
expiration dates of such policies or binders without the payment of additional
premiums, and will not in any way be affected by, or terminate or lapse by
reason of, the transactions contemplated by this Agreement. The Company has
not
been refused any insurance with respect to its respective assets or operations,
nor has its coverage been limited, by any insurance carrier to which it has
applied for any such insurance or with which it has carried
insurance.
|
3.23
|
Brokers
or Finders
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company has not incurred, and will not incur, directly or indirectly, as a
result of any action taken by or on behalf of the Company, any liability for
brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement or any transaction contemplated
hereby.
|
3.24
|
Government
Contracts
|
The
Company and each Shareholder represents and warrants to Buyer as follows: The
Company has never been, nor as a result of the consummation of the transactions
contemplated by this Agreement will it be, suspended or debarred from bidding
on
contracts or subcontracts for any agency of the United States government or
any
foreign government, nor to the knowledge of the Shareholder has
such
suspension or debarment been threatened or action for suspension or debarment
been commenced. The Company has not been nor is it currently being audited,
except in the ordinary course of business or as is customary in the industry
or
as provided by the Federal Acquisition Regulations or, to the knowledge of
the
Shareholder, investigated by the United States Government Accounting Office,
the
United States Department of Justice, the United States Department of Defense
or
any of its agencies, the Defense Contract Audit Agency or the inspector general
or other authorities of any agency of the United States government, or any
foreign government, nor, to the knowledge of the Shareholder, has such audit
or
investigation been threatened. There is no valid basis for the Company's
suspension or debarment from bidding on contracts or subcontracts for any agency
of the United States government or any foreign government and there is no valid
basis for a claim pursuant to an audit or investigation by the United States
Government Accounting Office, the United States Department of Justice, the
United States Department of Defense or any of its agencies, the Defense Contract
Audit Agency or other authorities of any agency of the United States government
or any foreign government, or any prime contractor with any such governmental
body. The Company has not had a contract or subcontract terminated for default
by the Company and has not been determined to be nonresponsible by any agency
of
the United States government or any foreign government.
|
3.25
|
Absence
of Questionable Payments
|
The
Company and each Shareholder represents and warrants to Buyer as
follows:
Neither
the Company nor any of its Shareholders, or to the knowledge of the
Shareholders, any agents, employees or other person acting on behalf of the
Company, has used any funds of the Company for improper or unlawful
contributions, payments, gifts or entertainment, or made any improper or
unlawful expenditures relating to political activity to government officials
or
others. The Company has not received notice that any transaction was improper
or
unlawful within the meaning of this Section 3.25. The Company has adequate
financial controls to prevent such improper or unlawful contributions, payments,
gifts, entertainment or expenditures. Neither the Company nor any of its current
directors or officers, agents, employees or any other Person acting on behalf
of
the Company, has accepted or received any improper or unlawful contributions,
payments, gifts or expenditures. The Company has at all times complied, and
is
in compliance in all respects, with the applicable provisions of the U.S.
Foreign Corrupt Practices Act, as amended, and other applicable domestic and
foreign laws and regulations relating to corrupt practices and similar
matters.
|
3.26
|
Bank
Accounts
|
The
Company and each Shareholder represents and warrants to Buyer as follows:
Disclosure Schedule 3.26
sets
forth the names and locations of all banks, trust companies, savings and loan
associations and other financial institutions at which the Company maintains
safe deposit boxes or accounts of any nature and the names of all persons
authorized to draw thereon, make withdrawals therefrom or have access
thereto.
|
3.27
|
Previous
Conduct of Business; Insider
Interests
|
The
Company and each Shareholder represents and warrants to Buyer as follows: All
the transactions of the Company with third parties have been conducted on an
arm's-length basis. No Shareholder, employee, contractor, consultant or other
representative of the Company has any direct or indirect interest, and
Shareholders have no direct or indirect interest, other than as a Shareholder
of
the Company (a) in any property, real or personal, tangible or intangible,
used in or directly pertaining to the business of the Company, including,
without limitation, any intellectual property, or (b) in any agreement,
contract, arrangement or obligation relating to the Company, its present or
prospective business or its operations. To the knowledge of the Shareholder,
neither the Company nor any of its Shareholders, employees, contractors or
consultants has any interest, either directly or indirectly, in any entity
that
presently (i) provides any services, produces and/or sells any products or
product lines, or engages in any activity that is the same, similar to or
competitive with any activity or business in which the Company is now engaged
or
proposes to engage or (ii) is a supplier, customer or creditor, or has an
existing contractual relationship with any of the Company's employees (or
persons performing similar functions).
|
3.28
|
Full
Disclosure
|
The
Company and each Shareholder represents and warrants to Buyer as follows: No
information furnished by the Company or the Shareholders to Buyer in connection
with this Agreement (including, but not limited to, the Financial Statements
and
all information in the Schedules and the Exhibits hereto) or to be furnished
prior to the Closing by or on behalf of the Company or the Shareholder(s) to
Buyer, or to others in connection with obtaining approval of the transaction
contemplated by this Agreement, is false or misleading in any material respect.
Neither the Company nor any Shareholder has made any untrue statement of a
material fact or omitted to state a material fact necessary in order to make
the
statements made or information delivered in or pursuant to this Agreement,
including, but not limited to, the Financial Statements, the Disclosure
Schedules and Exhibits hereto, or in or pursuant to closing certificates
executed or delivered by the Company or the Shareholder(s) not
misleading.
ARTICLE
IV - REPRESENTATIONS AND WARRANTIES
OF
BUYER
To
induce
the Shareholders to enter into and perform this Agreement, Buyer represents
and
warrants to the Shareholders as of the date of this Agreement and as of the
Closing as follows in this Article IV:
|
4.1
|
Organization
|
Buyer
is
a corporation duly organized, validly existing and in good standing under the
laws of the state of Colorado. Buyer has all requisite corporate power and
authority to own, operate and lease its properties and assets, to carry on
its
business as now conducted and as proposed to be conducted, to execute, deliver
and perform its obligations under this Agreement and the other Transaction
Documents to which it is a party, and to carry out the transactions contemplated
hereby and thereby.
|
4.2
|
Enforceability
|
All
corporate action on the part of Buyer and its officers, directors and
shareholders necessary for the authorization, execution, delivery and
performance of this Agreement and the other Transaction Documents to which
it is
a party, the consummation of the transactions contemplated hereby and thereby,
and the performance of all of Buyer's obligations under this Agreement and
the
other Transaction Documents to which it is a party has been taken or will be
taken prior to the Closing. This Agreement has been, and the other Transaction
Documents to which Buyer is a party on the Closing will be, duly executed and
delivered by Buyer, and this Agreement is, and each of the other Transaction
Documents to which Buyer is a party on the Closing will be, a legal, valid
and
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms.
|
4.3
|
No
Approvals or Notices Required; No Conflicts With
Instruments
|
The
execution, delivery and performance by Buyer of this Agreement and the other
Transaction Documents to which it is a party, and the consummation of the
transactions contemplated hereby and thereby, will not (a) constitute a
violation (with or without the giving of notice or lapse of time, or both)
of
any provision of any law or any judgment, decree, order, regulation or rule
of
any court, agency or other governmental authority applicable to Buyer,
(b) require Buyer to obtain any consent, approval or authorization of, or
declaration, filing or registration with, any Person, or (c) constitute a
violation of any provisions of Buyer's Certificate
of Incorporation and Bylaws.
|
4.4
|
Claims
and Legal Proceedings
|
There
is
no claim, action, suit, arbitration, criminal or civil investigation or
proceeding pending or involving or, to Buyer's knowledge, threatened against
Buyer before or by any court or governmental or nongovernmental department,
commission, board, bureau, agency or instrumentality, or any other Person,
that
questions the validity of this Agreement or any action taken or to be taken
by
Buyer pursuant to this Agreement or in connection with the transactions
contemplated hereby.
|
4.5
|
Brokers
or Finders
|
Buyer
has
not incurred, and will not incur, directly or indirectly, as a result of any
action taken by or on behalf of Buyer, any liability for brokerage or finders'
fees or agents' commissions or any similar charges in connection with this
Agreement or any transaction contemplated hereby.
|
4.6
|
Capitalization
|
Buyer
represents and warrants to the Company and each Shareholder as
follows:
(a) Pursuant
to the Company's Articles of Incorporation, the capital stock of Buyer consists
of 50,000,000 shares of common stock, no par value per share. There are
currently issued and outstanding 19,650,518 of the Company's common stock.
(b) Schedule
4.6(b) lists all persons owning an amount of Stock of Buyer equal to or
exceeding five percent (5%) of the issued and outstanding Stock of
Buyer
(c) Except
for (i) the right of certain note holders (the “Xxxx Parties”) to convert two
promissory notes in the aggregate principal amount of $409,089 at the conversion
rate of $1.00 per share, into shares of the common stock of Buyer, and (ii)
the
right of the non-employee directors of Buyer to receive 10,000 share each of
Buyer’s common stock, subject to a three year vesting period, there are no
outstanding rights of first refusal, preemptive rights, options, warrants,
conversion rights, anti-dilution rights or other agreements, either directly
or
indirectly, for the purchase or acquisition from the Buyer of any capital stock
or other rights (economic or otherwise) of Buyer.
(d) Buyer
is
not a party or subject to any agreement or understanding, and there is no
agreement or understanding between any person or entity, that affects or relates
to the voting or giving of written consents with respect to any capital stock
of
the Buyer or the voting by any shareholder of Buyer.
4.7 Good
Title
Except
as
provided in Section 2.2.2, and applicable securities laws, the Stock of Buyer
to
be delivered hereunder shall, at the time of delivery, be free and clear of
any
lien, encumbrance, adverse claim, restriction on sale, transfer or voting,
preemptive right, option or other right to purchase, and, except as provided
in
Section 2.2.2, and applicable securities laws, upon the delivery of the Stock
as
contemplated hereby, each Shareholder will have good title to such Stock, free
and clear of any lien, encumbrance, adverse claim, restriction on sale, transfer
or voting, preemptive right, option or other right to purchase.
|
4.8
|
Financial
Statements; Obligations
|
Buyer
represents and warrants that any financial statements provided to the Company
or
to any Shareholder (referred to as the "Financial
Statements")
have
been prepared in conformity with GAAP consistently applied throughout the
periods covered, except as may be indicated in the notes thereto, and present
fairly the financial position, results of operations and changes in financial
position of the Buyer at the dates and for the periods indicated, subject,
in
the case of the unaudited financial statements, to normal recurring period-end
adjustments. Buyer has no liabilities or obligations of any nature (absolute,
accrued or contingent) that are not fully reflected or reserved against in
the
Financial Statements, as prescribed by GAAP and the Financial Accounting
Standards Board, except liabilities or obligations incurred in the ordinary
course of business and consistent with past practice.
|
4.9
|
Taxes
|
Buyer
represents and warrants to the Company and each Shareholder, to the best of
its
knowledge, as follows:
(a) Through
the date of this Agreement, and for a period of two years prior thereto, Buyer
has filed on a timely basis all Tax Returns that the Buyer was required to
file.
All such Tax Returns were correct and complete in all respects and have been
prepared and completed in accordance with applicable law, including all and
were
prepared in accordance with the applicable statutes, rules and regulations.
No
such Tax Returns are currently the subject of audit or examination nor has
the
Buyer been notified in writing, or otherwise, of any request for an audit or
examination. All Taxes owed by the Buyer (whether or not shown on any Tax
Return) were paid in full when due or are being contested in good faith and
are
supported by adequate reserves on the Financial Statements. The Buyer has
provided adequate reserves on its Financial Statements for the payment of any
Taxes accrued but not yet due and payable. The Buyer is not currently the
beneficiary of any extension of time within which to file any Tax Return, and
the Buyer has not waived any statute of limitations in respect of Taxes or
agreed to any extension of time with respect to any Tax assessment or
deficiency. The Buyer has duly and timely withheld from employee salaries,
or
wages or other compensation (whether or not paid in cash) and other amounts
paid
to creditors, independent contractors and other third parties and paid over
to
the appropriate governmental authority all amounts required to be so withheld
and paid over for all periods under all applicable Tax or other laws. No amounts
have been or would be required to be withheld with respect to the lapse of
restrictions on the Shares. The Tax Returns of the Buyer do not contain a
disclosure under Section 6662 of the Code (or any predecessor provision or
comparable provision of state, local or foreign law). The Buyer does not do
business in or derive income from any state, local or foreign jurisdiction
other
than those jurisdictions for which Tax Returns have been duly filed by the
Buyer.
(b) There
is
no dispute, claim or proposed adjustment concerning any Tax liability of the
Buyer either (1) claimed or raised by any authority in writing or
(2) based upon personal contact with any agent of such authority. The Buyer
is not a party to nor has it been notified in writing or, otherwise, that it
is
the subject of any pending, proposed or threatened action, investigation,
proceeding, audit, claim or assessment by or before the IRS or any other
governmental authority, and no claim for assessment, deficiency or collection
of
Taxes, or proposed assessment, deficiency or collection from the IRS or any
other governmental authority which has not been satisfied, nor does the Buyer
have any reason to believe that any such notice will be received in the future.
The IRS has never audited any Tax Return of the Buyer. There are no Tax liens
of
any kind upon any property or assets of the Buyer, except for inchoate liens
for
Taxes not yet due and payable.
4.10 Securities
Representations
Buyer
(i)
is aware of the Company’s business affairs and financial condition, has reviewed
the most recent financial statements of Company; and (ii) has acquired
sufficient information about Company to reach an informed and knowledgeable
decision to acquire the Shares. Buyer has been furnished with all information
which Buyer deems necessary to evaluate the merits and risks of the purchase
of
the Shares, and Buyer has had the opportunity to ask questions and receive
answers concerning the Shares and the Company from the officers and directors
of
the Company, and to obtain any additional information concerning the Shares
or
the Company necessary to verify the accuracy of the information furnished or
made available to Buyer in connection herewith. Buyer is able to bear the
economic risk of such investment in the Shares. Buyer is purchasing the Shares
for investment and not with a view to, or for resale in connection with, any
"distribution" thereof within the meaning of the Act. Buyer understands that
the
Shares have not been registered under the Act
|
4.11
|
Full
Disclosure
|
The
Buyer
represents and warrants to the Company and each Shareholder as follows: No
information furnished by the Buyer to the Company or the Shareholders in
connection with this Agreement (including, but not limited to, any Financial
Statements and all information in the Schedules and the Exhibits hereto) or
to
be furnished prior to the Closing by or on behalf of the Buyer to the Company
or
the Shareholders, or to others in connection with obtaining approval of the
transaction contemplated by this Agreement, is false or misleading in any
material respect. Buyer has not made any untrue statement of a material fact
or
omitted to state a material fact necessary in order to make the statements
made
or information delivered in or pursuant to this Agreement, including, but not
limited to, any Financial Statements, the Disclosure Schedules and Exhibits
hereto, or in or pursuant to closing certificates executed or delivered by
Buyer
not misleading.
|
4.12
|
Tax
Consequences
|
Buyer
does not make any representation or warranty with respect to, and expressly
disclaims any responsibility for, any Tax consequences to the Shareholders
arising out of the structure or terms of this Agreement, or the negotiation
or
consummation hereof. Each Shareholder
shall be solely responsible for any such Tax consequences.
ARTICLE V
- COVENANTS
Between
the date of this Agreement and the time of Closing, the parties covenant and
agree as set forth in this Article V.
|
5.1
|
Conduct
of Business by the Company Pending the
Closing
|
Unless
Buyer shall otherwise agree in writing, the business of the Company shall be
conducted only in, and the Company shall not take any action except in, and
the
Shareholders of the Company shall cause the Company to be conducted in, the
ordinary course of business and in a manner consistent with past practice and
in
accordance with applicable law; and the Company shall use its best efforts
to
preserve substantially intact the business organization of the Company, to
keep
available the services of the current Shareholders, employees and consultants
of
the Company and to preserve the current relationships of the Company with
customers, suppliers and other persons with which the Company has significant
business relations. By way of amplification and not limitation, except as
otherwise contemplated by this Agreement, the Company shall not, between the
date of this Agreement and the time of Closing, directly or indirectly do,
or
propose to do, any of the following without giving Buyer prior written notice
of
and receiving Buyer's prior written consent:
(a) amend
or
otherwise change its Articles
of Incorporation or Bylaws;
(b) issue,
sell, pledge, dispose of, grant, encumber or authorize the issuance, sale,
pledge, disposition, grant or encumbrance of (i) any capital stock or other
interest in or to the Company, or any options, warrants, convertible securities
or other rights of any kind to acquire any Shares in or to the Company, or
any
other ownership interest (including, without limitation, any economic interest),
of the Company or (ii) any assets of the Company;
(c) declare,
set aside, make or pay any dividend or other distribution, payable in cash,
property or otherwise, with respect to any of its Shares, other than payments
necessary to achieve an Actual Net Equity (as defined in Section 2.2.2(b))
equal
to zero as of Closing;
(d) reclassify,
combine, split, subdivide, redeem, purchase or otherwise acquire, directly
or
indirectly, any of its Shares;
(e) (i) acquire
(including, without limitation, by merger, consolidation, or acquisition of
stock or assets) or form any corporation, partnership, other business
organization or division thereof, or acquire directly or indirectly any material
amount of assets; (ii) incur any indebtedness for borrowed money or issue
any debt securities or assume, guarantee or endorse, or otherwise as an
accommodation become responsible for, the obligations of any Person, or make
any
loans or advances, except in the ordinary course of business and consistent
with
past practice which loans shall be on terms and conditions satisfactory to
Buyer; (iii) enter into any contract or agreement other than in the
ordinary course of business, consistent with past practice; (iv) authorize
any single capital expenditure that is in excess of $2,500 or capital
expenditures that are, in the aggregate, in excess of $10,000; or (v) enter
into or amend any contract, agreement, commitment or arrangement with respect
to
any matter set forth in this subsection (e);
(f) enter
into any employment, consulting or agency agreement, or increase the
compensation payable or to become payable to its Shareholders, employees or
consultants (other than payment of compensation necessary to achieve an Actual
Net Equity (as defined in Section 2.2.2(b)) equal to zero as of Closing), except
for increases in accordance with existing agreements or past practices for
employees of the Company who are not Shareholders of the Company, or grant
any
severance or termination pay to, or enter into any employment or severance
agreement with, any Shareholder, employee, or consultant of the Company, or
establish, adopt, enter into or amend any collective bargaining, bonus, profit
sharing, thrift, compensation, stock option, restricted stock, pension,
retirement, deferred compensation, employment, termination, severance or other
plan, agreement, trust, fund, policy or arrangement for the benefit of any
director, officer or employee;
(g) take
any
action, other than reasonable and usual actions in the ordinary course of
business and consistent with past practice, with respect to accounting policies
or procedures (including, without limitation, procedures with respect to the
payment of accounts payable and collection of accounts receivable);
(h) make
any
tax election inconsistent with past practices or settle or compromise any
material federal, state, local or foreign income tax liability;
(i) pay,
discharge or satisfy any claim, liability or obligation (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than the payment,
discharge or satisfaction, in the ordinary course of business and consistent
with past practice, of liabilities reflected or reserved against in the Balance
Sheet or subsequently incurred in the ordinary course of business and consistent
with past practice;
(j) enter
into any equipment lease; or
(k) issue
certificates for any of the Shares; or
(l) agree
to
do any of the foregoing.
|
5.2
|
Access
to Information;
Confidentiality
|
From
the
date hereof to the time of Closing, the Company and the Shareholders shall,
and
shall cause their representatives to, afford Buyer and its
representatives complete access
at
all reasonable times to the Shareholders, employees, agents, properties,
offices, plants and other facilities, books and records of the Company and
shall
furnish Buyer with all financial, operating and other data and information
as
Buyer may reasonably request and as such access is necessary to the consummation
of the transactions contemplated hereby. From the date hereof until the time
of
Closing, the Company shall provide Buyer with financial statements of the
Company as they become available internally at the Company, all of which
financial statements shall be prepared in conformity with GAAP and shall fairly
present the financial position and results of operations of the Company as
of
the dates and for the periods specified. All information obtained by either
party pursuant to this Section 5.2 shall be kept confidential in accordance
with the following terms:
(a) Except
as
and to the extent required by law, neither Buyer nor the Company shall disclose
or use, and it shall cause its representatives not to disclose or use, any
Confidential Information (as defined below) with respect to Buyer or the Company
furnished, or to be furnished, by Buyer or the Company or their respective
representatives in connection herewith, at any time or in any manner other
than
in connection with its evaluation or consummation of the transaction proposed
in
this Agreement. For purposes of this Agreement, "Confidential Information"
means
any information about Buyer or its subsidiaries or the Company supplied to
the
other and stamped "confidential" or identified as such to Buyer or the Company
by the other; provided that Confidential Information does not include
information which the party to which it is provided can demonstrate (i) is
generally available to or known by the public, other than as a result of
improper disclosure by the party to which the information was provided; or
(ii)
is obtained by the party to which the information was provided from a source
other than Buyer or the Company, respectively, provided that such source was
not
bound by a duty of confidentiality to Buyer or the Company, or another party
with respect to such information. If this Agreement is terminated prior to
Closing, each party shall promptly return to each other party any Confidential
Information of another party in its possession.
(b) Except
as
and to the extent required by law, without the prior written consent of the
other parties, neither Buyer nor the Company shall, and each shall direct its
representatives not to, directly or indirectly, make any public comment,
statement or communication with respect to, or otherwise disclose or permit
the
disclosure of the existence of discussions regarding, a possible transaction
between the parties or any of the terms, conditions or other aspects of the
transaction proposed in this Agreement. If a party is required by law to make
any such disclosure, it must first provide to the other parties the content
of
the proposed disclosure, the reasons that such disclosure is required by law,
and the time and place that the disclosure will be made; provided, however,
that
nothing in this Section 5.2(b) shall be deemed to prohibit Buyer from making
any
disclosure required by the rules and regulation promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange
Act")
without first consulting the Company.
|
5.3
|
No
Alternative Transactions
|
The
Company and the Shareholders shall not, directly or indirectly, through any
Shareholder, employee, agent, investment banker, attorney or otherwise, solicit,
initiate or encourage the submission of any proposal, offer, inquiry or contact
from any person or entity relating to any acquisition or purchase of all or
(other than in the ordinary course of business) any portion of the assets of,
or
any equity interest in, the Company or any business combination with the
Company, or participate in any negotiations or discussions regarding, or furnish
to any other person or entity any information with respect to, or otherwise
cooperate in any way with, or assist or participate in, facilitate or encourage,
any effort or attempt by any other person or entity, to do or seek any of the
foregoing. The Shareholders immediately shall cease and cause to be terminated
with no obligation, financial or otherwise, on the part of the Company or the
Shareholders, all existing discussions or negotiations with any other parties
conducted heretofore with respect to any of the foregoing.
The
Company and the Shareholders shall notify Buyer promptly if any such proposal
or
offer, or any inquiry or contact with any Person with respect thereto, is made
and shall, in any such notice to Buyer, indicate in reasonable detail the
identity of the person or entity making such proposal, offer, inquiry or contact
and the terms and conditions of such proposal, offer, inquiry or contact. The
Company agrees not to release any third party from, or waive any provision
of,
any confidentiality or standstill agreement to which the Company is a
party.
|
5.4
|
Notification
of Certain Matters
|
The
Company and the Shareholders shall give prompt written notice to Buyer, and
Buyer shall give prompt written notice to the Company and the Shareholders,
of
(a) the occurrence or nonoccurrence of any event which would be likely to
(i) cause any representation or warranty of the Company, the
Shareholder(s), or Buyer, respectively, contained in this Agreement to be
materially untrue or inaccurate or (ii) result in the material failure to
satisfy a closing condition in Article VII or VIII; (b) any material
failure of the Company, the Shareholder(s), or Buyer, respectively, to comply
with or satisfy any covenant, condition or agreement to be complied with or
satisfied by it or them; and (c) any written communication from any person
or entity alleging that the consent of such person or entity may be required
in
connection with the transactions contemplated by this Agreement; provided,
however, that the delivery of any notice pursuant to this Section 5.4 shall
not limit or otherwise affect the remedies available hereunder to the party
receiving such notice.
|
5.5
|
Further
Action
|
Upon
the
terms and subject to the conditions hereof, each of the parties shall
(a) make promptly its respective filings, and thereafter make any other
required submissions, under applicable laws with respect to the transactions
contemplated hereby and shall cooperate with the other parties with respect
to
such filings and submissions and (b) use its best efforts to take, or cause
to be taken, all appropriate action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated hereby, including,
without limitation, using its best efforts to obtain all waivers, licenses,
permits, consents, approvals, authorizations, qualifications and orders of
governmental authorities and parties to contracts as are necessary for the
consummation of the transactions contemplated hereby and to fulfill the
conditions to the closing of the sale of the Shares to Buyer. In case at any
time after the Closing Date any further action is necessary or desirable to
carry out the purposes of this Agreement, each party to this Agreement shall
use
its best efforts to take all such action. Neither the Buyer nor the Company
or
the Shareholder(s) will undertake any course of action inconsistent with this
Agreement or that would make any representations, warranties or agreements
made
by such party in this Agreement untrue or any conditions precedent to this
Agreement unable to be satisfied at or prior to the Closing.
|
5.6
|
Publicity
|
Except
as
set forth in Section 5.2(b), none of the parties shall disclose, make or issue,
or cause to be disclosed, made or issued, any statement or announcement
concerning this Agreement or the transactions contemplated hereby to any third
parties (other than its officers, directors, employees, authorized
representatives, legal advisors and financial advisors who need to know such
information in connection with carrying out or facilitating the transactions
contemplated hereby) without the prior written consent of the other parties,
except as required by law or any listing or other agreement with any public
securities trading exchange or market to which Buyer is a party and after
providing written notice to the other parties of such required
disclosure.
5.7. Covenants
Not to Compete
5.7.1 Covenants
In
consideration of the payment of the Purchase Price by Buyer to the Shareholders
at the Closing, the Shareholders covenant and agrees as follows:
(a) During
any period during which a Shareholder performs services as an employee,
consultant or otherwise for the Company, and, unless employment is terminated
by
Buyer without reasonable cause, for the two (2)-year period commencing upon
the
date that the Shareholder ceases to perform services for the Company (the
"Non-Compete
Period"),
neither the Shareholder nor any of the Shareholder's affiliates shall engage
in
any Competitive Business (as such term is defined below), whether directly
or
indirectly, for its account or otherwise, or as a member, shareholder, owner,
partner, principal, agent, joint venturer, consultant, advisor, franchisor
or
franchisee, independent contractor or otherwise, in, with or of any person
or
entity that engages directly or indirectly in any Competitive Business. As
used
herein, "Competitive Business" shall mean any business that competes with the
Company or the Buyer in the United States, including, without limitation, any
business that provides geographic and land information systems, software,
services or data.
(b) During
the Non-Compete Period, neither the Shareholder nor any of its affiliates shall,
directly or indirectly, hire, or solicit or encourage to leave the employment
of
the Company, Buyer or any of their affiliates, or any former employee of the
Company hired by Buyer, the Company or their affiliates, or have any arrangement
(financial, consulting or otherwise) with any such individual.
5.7.2 Minor
Investments
Notwithstanding
the provisions of Section 5.7.1(a) above, a Shareholder may at any time own
in
the aggregate, directly or indirectly, for investment purposes only, 5% or
less
of any class of securities of any entity traded on any national securities
exchange or quoted on the Nasdaq that engages in a Competitive
Business.
5.7.3 Remedies
The
Shareholders acknowledge that compliance with the provisions of this Section
5.7
is necessary and proper to preserve and protect the business of the Company
acquired by Buyer under this Agreement and to assure that the parties receive
the benefits intended to be conveyed pursuant to this Section 5.7, the
Shareholders agree that any failure by the Shareholders or any of their
affiliates to comply with the provisions of this Section 5.7 shall entitle
Buyer
and its affiliates, in addition to such other relief and remedies as may be
available, to equitable relief, including, but not limited to, the remedy of
injunction. Resort to any remedy shall not prevent the concurrent or subsequent
employment of any other remedy, or preclude the recovery by Buyer and its
affiliates of monetary damages and compensation.
5.7.4 Severability;
Reformation
The
covenants in this Section 5.7 are severable and separate, and the
unenforceability of any specific covenant shall not affect the continuing
validity and enforceability of any other covenant. In the event any court of
competent jurisdiction shall determine that the scope, time or territorial
restrictions set forth in this Section 5.7 are unreasonable and therefore
unenforceable, then it is the intention of the parties that such restrictions
be
enforced to the fullest extent that the court deems reasonable and this
Agreement shall thereby be reformed.
5.8. Payment
of Audit Costs
The
Company and Shareholders have contracted to have an audit (the "Audit")
conducted by certified public accountants necessary to create and deliver
audited financial statements required to be delivered pursuant to Section 3.6
hereof. The Company shall pay the costs of such Audit, whether invoiced and
billed prior to Closing or post closing.
ARTICLE
VI - INTENTIONALLY
OMITTED
ARTICLE
VII - CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER
The
obligations of Buyer to perform and observe the covenants, agreements and
conditions to be performed and observed by it at or before the Closing shall
be
subject to the satisfaction of the following conditions, which may be expressly
waived only in writing signed by Buyer.
|
7.1
|
Accuracy
of Representations and
Warranties
|
Each
of
the representations and warranties of the Company and/or the Shareholders
contained in this Agreement and the other Transaction Documents to which each
is
a party (including all exhibits, schedules, and attachments thereto) shall
be
true and correct as of the date hereof and at and as of the Closing Date as
though made on that date; except to the extent such representations and
warranties are made as of a specified date, in which case such representations
and warranties shall be true and correct as of the specified date.
|
7.2
|
Performance
of Agreements
|
The
Company and the Shareholders shall have performed all obligations and agreements
and complied with all covenants and conditions contained in this Agreement
or
any other Transaction Document to be performed and complied with by them at
or
prior to the Closing.
|
7.3
|
Liabilities
|
The
liabilities of the Company shall be as disclosed in Schedule 2.2.2(b).
|
7.4
|
Shareholders'
Certificate
|
Buyer
shall have received a certificate of the Shareholders of the Company, dated
the
Closing Date, substantially in the form attached as Exhibit 7.4,
certifying that the conditions set forth in Sections 7.1, 7.2, 7.5 and 7.7
have been fulfilled.
|
7.5
|
Material
Adverse Change
|
Since
the
date hereof and through the Closing, there shall not have occurred (or be
threatened) any material adverse change (a) in the business, operations,
assets, liabilities, earnings, condition (financial or other), or prospects
of
the Company or (b) with respect to the Shareholders or the Shares, and no
material adverse change shall have occurred (or be threatened) in any domestic
or foreign laws or regulations affecting the Company or in any third party
contractual or other business relationships of the Company.
|
7.6
|
Due
Diligence and Board
Approval
|
The
results of Buyer's due diligence investigation of the Company and the
Shareholders shall be satisfactory in all respects to Buyer and the Board of
Directors of Buyer shall have approved this Agreement and the transactions
contemplated hereby.
|
7.7
|
Approvals
and Consents
|
All
transfers of permits or licenses and all approvals, applications or notices
to
public agencies, federal, state, local or foreign, the granting or delivery
of
which is necessary for the consummation of the transactions contemplated hereby
or for the continued operation of the Company shall have been obtained, and
all
waiting periods specified by law shall have passed. All other consents,
approvals and notices material to the consummation of the transactions
contemplated by this Agreement shall have been obtained or delivered. All such
transfers, approvals, and consents shall be satisfactory in all respects to
Buyer in its sole and absolute discretion.
|
7.8
|
Proceedings
and Documents
|
All
corporate and other proceedings in connection with the transactions contemplated
hereby and all documents and instruments incident to such transactions shall
have been approved by counsel to Buyer and the Buyer.
|
7.9
|
Compliance
With Laws
|
The
consummation of the transactions contemplated by this Agreement shall be legally
permitted by all laws and regulations to which Buyer is subject.
|
7.10
|
Legal
Proceedings
|
No
order
of any court or administrative agency shall be in effect that enjoins,
restrains, conditions or prohibits consummation of this Agreement, and no
litigation, investigation or administrative proceeding shall be pending or
threatened that would enjoin, restrain, condition or prevent consummation of
this Agreement or the transactions contemplated hereby.
|
7.11
|
Delivery
of Endorsed
Certificates
|
The
Shareholders shall deliver to Buyer at Closing original certificates
representing the Shares, duly endorsed in favor of Buyer.
ARTICLE
VIII - CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SHAREHOLDERS
The
obligations of the Company and the Shareholders to perform and observe the
covenants, agreements and conditions to be performed and observed by any of
them
at or before the Closing shall be subject to the satisfaction of the following
conditions, which may be expressly waived only in writing signed by the
Shareholders.
|
8.1
|
Accuracy
of Representations and
Warranties
|
Each
of
the representations and warranties of Buyer contained in this Agreement and
the
other Transaction Documents to which it is a party shall be true and correct
as
of the date hereof and at and as of the Closing Date as though made on that
date, except to the extent such representations and warranties are made as
of a
specified date, in which case such representations and warranties shall be
true
and correct as of the specified date.
|
8.2
|
Performance
of Agreements
|
Buyer
shall have performed all obligations and agreements and complied with all
covenants and conditions contained in this Agreement or any other Transaction
Document to be performed and complied with by it at or prior to the
Closing.
|
8.3
|
Officers'
Certificate
|
|
8.4
|
Material
Adverse Change
|
Since
the
date hereof and through the Closing, there shall not have occurred any material
adverse change in the business, operations, assets, liabilities, earnings,
condition (financial or other) of Buyer that would render Buyer unable to
perform its obligations under the Transaction Documents.
|
8.5
|
Approvals
and Consents
|
All
transfers of permits or licenses and all approvals, applications or notices
to
public agencies, federal, state, local or foreign, required to be obtained
by
Buyer for the consummation of the transactions contemplated hereby shall have
been obtained, and all waiting periods specified by law shall have
passed.
|
8.6
|
Proceedings
and Documents
|
All
corporate and other proceedings in connection with the transactions contemplated
hereby and all documents and instruments incident to such transactions shall
have been approved by counsel to the Shareholders and the
Shareholders.
|
8.7
|
Compliance
With Laws
|
The
consummation of the transactions contemplated by this Agreement shall be legally
permitted by all laws and regulations to which the Company and the Shareholders
are subject.
|
8.8
|
Legal
Proceedings
|
No
order
of any court or administrative agency shall be in effect that enjoins,
restrains, conditions or prohibits consummation of this Agreement, and no
litigation, investigation or administrative proceeding shall be pending or
threatened that would enjoin, restrain, condition or prevent consummation of
this Agreement or the transactions contemplated hereby.
8.9 Deliveries
of Buyer
Buyer
shall deliver to Shareholders, at or before Closing, the following documents
and
agreements executed by Buyer: (a) Offer Letter - Xxx Xxxxxxxxx; (b) Offer Letter
- Xxxxxxx Xxxxx; and (c) Offer Letter - X.X. XxXxxxx, III.
ARTICLE
IX - TERMINATION, AMENDMENT AND WAIVER
|
9.1
|
Termination
|
This
Agreement may be terminated at any time prior to the Closing:
(a) by
mutual
written consent of the Shareholders and Buyer;
(b) by
the
Company and the Shareholders, if Buyer shall have breached any of its
representations, warranties or agreements;
(c) by
Buyer,
if the Shareholders or the Company shall have breached any of its or their
representations, warranties or agreements;
(d) by
either
the Company or Buyer if the Closing has not occurred by March
31,
2007; provided, however, that the right to terminate this Agreement under this
subsection (d) shall not be available to any party whose failure to fulfill
any obligation under this Agreement has been the cause of, or resulted in,
the
failure of the Closing to occur on or before such date;
(e) by
either
the Company or Buyer if there shall be any law or regulation that makes
consummation of the sale of the Shares by the Shareholders to Buyer illegal
or
otherwise prohibited or if any judgment, injunction, order or decree enjoining
Buyer or the Company from consummating the sale of the Shares by the
Shareholders to Buyer is entered and such judgment, injunction, order or decree
shall become final and nonappealable; or
(f)
at
any time prior to the Closing by Buyer if, at any time in the course of its
legal, accounting, financial or operational due diligence investigation as
to
the Company and the Shareholders, it shall have become aware of any facts or
circumstances that it was not aware of on the date hereof, or any additional
facts and circumstances as to matters of which it was aware on the date hereof,
in either case that would, in the reasonable judgment of Buyer, make it
inadvisable to consummate the purchase of the Shares and the other transactions
contemplated hereby.
|
9.2
|
Effect
of Termination
|
In
the
event of the termination of this Agreement pursuant to Section 9.1, there
shall be no further obligation on the part of any party, except that the
confidentiality obligations under Section 5.2, and the obligations arising
under Sections 9.2, 11.1, 11.2, 11.5 and 11.8 shall survive any such termination
and nothing shall relieve any party from liability for any breach
thereof.
|
9.3
|
Amendment
|
Buyer,
the Company and the Shareholders may amend, modify or supplement this Agreement
at any time, but only in writing duly executed on behalf of each of the parties
to be bound thereby.
|
9.4
|
Waiver
|
At
any
time prior to the Closing, any party may (a) extend the time for the
performance of any obligation or other act of any other party, (b) waive
any inaccuracy in the representations and warranties contained in any
Transaction Document, or (c) waive compliance with any agreement or
condition in any Transaction Document. Any such extension or waiver shall be
valid only if set forth in an instrument in writing signed by the party or
parties to be bound. The failure of any party at any time or times to require
performance of any provisions shall in no manner affect its right at a later
time to enforce the same. No waiver by any party of any condition or of any
breach of any terms, covenants, representations, warranties or agreements
contained in this Agreement shall be deemed to be a further or continuing waiver
of any such condition or breach in other instances or a waiver of any other
condition or any breach of any other terms, covenants, representations,
warranties or agreements.
ARTICLE
X - SURVIVAL AND INDEMNIFICATION
|
10.1
|
Survival
|
All
representations and warranties contained in this Agreement or the other
Transaction Documents shall survive for a period of three
(3)
years following the Closing.
The
covenants and agreements contained in this Agreement that contemplate
performance after the Closing shall survive the Closing and shall continue
until
all obligations with respect thereto shall have been performed or satisfied
or
shall have been terminated in accordance with their terms.
|
10.2
|
Indemnification
|
10.2.1 Indemnification
by the Shareholders
From
and
after the Closing Date, the Shareholders shall jointly
and severally indemnify
and hold Buyer and its affiliates (the "Buyer
Indemnified Parties")
harmless from and against, and shall reimburse Buyer Indemnified Parties for,
any and all losses, damages, debts, liabilities, obligations, judgments, orders,
awards, writs, injunctions, decrees, fines, penalties, taxes, costs or expenses
(including but not limited to any legal and accounting fees and expenses)
("Losses")
arising out of or in connection with:
(a) any
inaccuracy in or other breach of any representation or warranty made by the
Shareholders in this Agreement or in any other Transaction
Document;
(b) any
failure by the Shareholders or the Company to perform or comply, in whole or
in
part, with any covenant or agreement in this Agreement or any other Transaction
Document to which it is a party; or
(c) any
claim, demand, cause of action, suit, proceeding, hearing or investigation
by
any person or entity for brokerage or finder's fees or commissions or similar
payments based upon any agreement or understanding alleged to have been made
by
such person or entity directly or indirectly with the Company, any of its
Shareholders or employees in connection with any of the transactions
contemplated by this Agreement or any other Transaction Document.
10.2.2 Indemnification
by Buyer
From
and
after the Closing Date, Buyer shall indemnify and hold the Shareholders (the
"Shareholder
Indemnified Parties")
harmless from and against, and shall reimburse the Shareholder Indemnified
Parties for, any and all Losses arising out of or in connection
with:
(a) any
inaccuracy in or other breach of any representation or warranty made by Buyer
in
this Agreement or in any other Transaction Document;
(b) any
failure by Buyer to perform or comply, in whole or in part, with any covenant
or
agreement in this Agreement or any other Transaction Document to which it is
a
party.
(c) any
claim, demand, cause of action, suit, proceeding, hearing or investigation
by
any person or entity for brokerage or finder's fees or commissions or similar
payments based upon any agreement or understanding alleged to have been made
by
such person or entity directly or indirectly with the Buyer, any of its
shareholders or employees in connection with any of the transactions
contemplated by this Agreement or any other Transaction Document.
|
10.3
|
Limitations
|
(a) Any
claim
for indemnification must be asserted as provided in Section 10.4 within
three years from the Closing, otherwise, this Article X shall be null, void
and without effect.
(b) In
no
event shall any party be indemnified for any Loss to the extent it is covered
by
insurance.
|
10.4
|
Procedure
for Indemnification
|
10.4.1 Claim
Notice
The
Shareholder Indemnified Parties together with Buyer Indemnified Parties, are
sometimes referred to herein as the "Indemnified
Parties"
In the
event that any Indemnified Party sustains or incurs any Losses in respect of
which indemnification may be sought pursuant to this Article X, such
Indemnified Party may assert a claim for indemnification by giving written
notice (the "Claim
Notice")
to the
indemnifying party, which will describe in reasonable detail the facts and
circumstances on which the asserted claim for indemnification is based. The
Claim Notice will also specify how the Indemnified Party intends to recover
such
funds pursuant to this Agreement. Unless the claim described in the Claim Notice
is contested by the indemnifying party by written notice to the Indemnified
Party of the amount of the claim that is contested, given within 30 days of
the receipt of the Claim Notice, the Indemnified Party may recover such
undisputed amount of the claim described in the Claim Notice.
10.4.2 Dispute
Notice
If,
within thirty (30) days of the receipt by the indemnifying party of the
Claim Notice, the indemnifying party contests in writing to the Indemnified
Party that such Loss constitutes an indemnifiable claim (the "Dispute
Notice"),
then
the Indemnified Party and the indemnifying party, acting in good faith, shall
attempt to reach agreement with respect to such claim. If the Indemnified Party
and the indemnifying party should so agree, a memorandum setting forth such
agreement shall be prepared and signed by the Indemnified Party and the
indemnifying party.
10.4.3 Third-Party
Claims
With
respect to claims for indemnification resulting from or in connection with
any
legal proceeding commenced by a third party, the Indemnified Party will give
the
Claim Notice to the indemnifying party no later than ten (10) days prior to
the
time any initial answer or response to the asserted claim is legally required
under any applicable court or procedural rule. Nothing in this
Section 10.4.3 limits in any way the right of the Indemnified Party to
defend against any claim or litigation in such manner as it may deem
appropriate, including, but not limited to, settling the claim or litigation
(after giving notice of the same to the indemnifying party) on such terms as
the
Indemnified Party may in good xxxxx xxxx appropriate (provided, however, that
no
such settlement shall occur without the indemnifying party's prior written
consent, which shall not be unreasonably withheld). The indemnifying party
will,
subject to the limitations set forth in Section 10.3, promptly indemnify
the Indemnified Party in accordance with the provisions of this Article X
and the Escrow Agreement.
|
10.5
|
Investigations;
Waivers
|
An
Indemnified Party's right to indemnification provided for in this Article X
will remain in effect notwithstanding any investigation at any time by or on
behalf of any party or any waiver by any party of any condition to such party's
obligations to consummate the transactions contemplated hereby.
10.6 Post
Closing Adjustments
In
the
event that the undisclosed liabilities of the Company as of Closing exceed
$50,000 (whether such liabilities are discovered prior to Closing or post
Closing at anytime during the survival period set forth in Section 10.1) (the
total amount of such liabilities being referred to herein as the "Excess
Liabilities"),
then
the Buyer shall deduct, pro-rata, from the Post Closing Payment that number
of
shares of Stock having a fair market value, determined by the average closing
price per share of the Stock for the five (5) days prior to the date Excess
Liabilities are discovered, equal to the dollar amount of the Excess
Liabilities. In the event the Post Closing Payment has already been made then,
within 10 days after receiving written notice from Buyer concerning the Excess
Liabilities, the Shareholders shall obligated, pro-rata, to surrender for
cancellation and shall deliver to Buyer certificates for the Stock, duly
endorsed in favor of Buyer, having a fair market value, determined by the
average closing price per share of the Stock for the five (5) days prior to
the
date Excess Liabilities are discovered, equal to the dollar amount of the Excess
Liabilities. In the event there are Excess Liabilities and the Shareholders
fail
to surrender or are unable to surrender the Stock required hereby, the
Shareholders, pro-rata, shall pay to Buyer an amount equal to the Excess
Liabilities less the value of any Stock surrendered pursuant to the terms of
this section 10.6.
ARTICLE
XI - GENERAL
|
11.1
|
Expenses
|
Whether
or not the transactions contemplated by this Agreement are consummated, each
party shall each pay its own fees and expenses for the negotiation, preparation
and carrying out of this Agreement and the other Transaction Documents
(including legal and accounting fees and expenses).
|
11.2
|
Consequential
Damages
|
No
party
shall be liable to the other parties for any special, indirect, incidental
or
consequential damages resulting from any breach of this Agreement.
|
11.3
|
Assignment
|
This
Agreement shall not be assigned by operation of law or otherwise, except
that
Buyer may assign all or any of its rights and obligations to any of its
affiliates. In the event of any such permitted assignment, Buyer shall guarantee
the performance of such obligations by such assignee.
|
11.4
|
Notices
|
Unless
otherwise provided, any notice under this Agreement shall be given in writing
and shall be deemed effectively given (a) upon personal delivery to the
party to be notified, (b) upon confirmation of receipt by fax by the party
to be notified, (c) one business day after deposit with a reputable
overnight courier, prepaid for overnight delivery and addressed as set forth
in
(d), or (d) three days after deposit with the U.S. Post Office, postage
prepaid, registered or certified with return receipt requested and addressed
to
the party to be notified at the address indicated for such party below, or
at
such other address as such party may designate by 10 days' advance written
notice to the other parties given in the foregoing manner.
If
to the
Buyer: Xedar
Corporation.
0000
Xxxxx Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
Attention:
Xxxx X. Xxxxxxxxxx, III
President
and CEO
Fax:
000-000-0000
With
a
copy
to: Castle
Xxxxxxxx & Stawiarski, LLC
000
00xx
Xxxxxx, Xxxxx 0000
Xxxxxx,
XX 00000
Attention:
Xxxx X. Xxxxxxx, Esq.
Fax:
000-000-0000
If
to the
Company or the Shareholders: Point
One
Inc.
0000
Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx,
XX 00000
Attention:
Xxx X. Xxxxxxxxx, Xxxxxxx X. Xxxxx and X.X. XxXxxxx, III
Fax:
000-000-0000
With
a
xxx
to:
Xxxxxxx
& Xxxxxxx, P.L.C.
000
X.
Xxxx Xxxxxx
Xxxxxxxx,
XX 00000
|
11.5
|
Governing
Law; Jurisdiction; Venue
|
This
Agreement shall be governed by and construed under the laws of the state of
Colorado without
regard to principles of conflict of laws. The parties irrevocably consent to
the
jurisdiction and venue of the state and federal courts located in Denver,
Colorado in
connection with any action relating to this Agreement.
|
11.6
|
Successors
and Assigns
|
The
terms
and conditions of this Agreement shall inure to the benefit of and be binding
on
the respective successors and assigns of the parties.
|
11.7
|
Severability
|
If
one or
more provisions of this Agreement are held to be unenforceable under applicable
law, such provision shall be excluded from this Agreement, and the balance
of
this Agreement shall be interpreted as if such provision were so excluded and
shall be enforceable in accordance with its terms.
|
11.8
|
Entire
Agreement; Counterparts
|
This
Agreement constitutes the entire agreement among the parties with respect to
this subject matter and supersedes all
prior
agreements and undertakings, both written and oral, among the parties with
respect to this subject matter hereof. This Agreement may be executed in two
or
more counterparts, which together shall constitute one instrument.
11.9 Headings
and Captions
The
headings and captions prefacing each Section and most paragraphs of this
Agreement are inserted only for the purpose of convenient reference and
cross-reference and in no way define, limit or prescribe the substantive
content, scope or intent of this Agreement nor affect the meaning,
interpretation, construction or enforcement of any provision
thereof.
|
11.10
|
Further
Assurances
|
The
parties agree, at any time and from time to time to do, execute, acknowledge,
deliver, all such further acts, stock certificates, stock powers, proxies,
resignations, assignments, transfers, conveyances, powers of attorney, and
assurances as may be required to complete the transactions contemplated in
this
Agreement.
|
11.11
|
Exhibits
and Schedules
|
All
Exhibits and Schedules referenced in, and attached to, this Agreement are
incorporated in this Agreement by this reference hereto.
IN
WITNESS WHEREOF, the parties hereto have entered into and signed this Agreement
effective as of the date and year first above written.
BUYER:
Xedar
Corporation,
a
Colorado corporation
By: /s/
Xxxx X. Xxxxxxxxxx, III
Xxxx
X.
Xxxxxxxxxx, III, President and CEO
COMPANY:
Atlantic
Systems Corporation
a
Virginia corporation
By: /s/
Xxx X. Xxxxxxxxx
Name: Xxx
X.
Xxxxxxxxx
Title: CEO
SHAREHOLDERS:
/s/
Don W. Rakesraw
Xxx
X.
Xxxxxxxxx
/s/
Xxxxxxx X. Xxxxx
Xxxxxxx
X. Xxxxx
/s/
X.X. XxXxxxx, III
X.X.
XxXxxxx, III
List
of Exhibits and Schedules
|
Exhibits
|
||
|
Exhibit
2.2.2
|
-
|
Registration
Rights and Lock-Up Agreement
|
|
Exhibit
7.4
|
-
|
Shareholders'
Certificate
|
|
Exhibit
8.3
|
-
|
Officer’s
Certificate (Buyer)
|
|
Schedules
|
||
|
Schedule
2.1
|
-
|
Excluded
Assets
|
|
Schedule
2.2.2(b)
|
-
|
Accounts
Receivable as of Closing Balance Sheet date
|
|
Schedule
3.6
|
-
|
Operating
Liabilities
|
|
Schedule
3.9(a)
|
-
|
Real
Property (owned, leased, rented or used by the Company)
|
|
Schedule
3.9(b)
|
-
|
Personal
Property (owned, leased, rented or used by the Company and having
a value
in excess
of $2,000)
|
|
Schedule
3.10
|
-
|
Material
Contracts (all material contracts, agreements, arrangements of the
Company)
|
|
Schedule
3.11
|
-
|
Customers
(material customers of the Company)
|
|
Schedule
3.12
|
-
|
Pending
Litigation and Claims
|
|
Schedule
3.15
|
-
|
Employee
Benefit Plans (benefit plans of the Company)
|
|
Schedule
3.17.2
|
-
|
Third
Party Technology; Third Party Licenses (used in the Company's
business)
|
|
Schedule
3.17.3
|
-
|
Trademarks
(trademarks, trade names, brand names of the Company)
|
|
Schedule
3.17.4
|
-
|
IP
Registrations (all patents, patent applications, copyright registrations,
trademark applications
of the
Company)
|
|
Schedule
3.17.8
|
-
|
Domain
Names (all websites of the Company)
|
|
Schedule
3.20
|
-
|
Permits;
Registrations (all governmental approvals, authorizations, consents,
licenses, orders, registrations and permits of the
Company)
|
|
Schedule
3.22
|
-
|
Insurance
Policies (all insurance policies of the Company)
|
|
Schedule
3.26
|
-
|
Bank
Accounts (all accounts and account signatories of the
Company)
|
|
Schedule
4.6(b)
|
-
|
Shareholders
holding 5% or more Shares of Common
Stock
|
