EXHIBIT E
PURCHASE AND SALE AGREEMENT, dated as of October 22, 1996, by and
between L&R HOLDINGS, INC., a New York corporation with a principal place of
business at 000 Xxxxx Xxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, Xxx Xxxx 00000 ("L&R")
and X.X. XXXXXX residing at 000 Xxxx Xxxx, Xxxxxxxx, XX 00000 ("Xxxxxx").
WHEREAS, L&R is the record and beneficial owner of an aggregate of
13,145,854 shares of the issued and outstanding common stock of American Film
Technologies, Inc., $.002 par value (the "Common Stock");
WHEREAS, Xxxxxx desires to purchase from L&R and L&R desires to sell
to Xxxxxx an aggregate of 1,200,000 shares of Common Stock (the "Shares"), upon
the terms and subject to the conditions of this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. PURCHASE AND SALE. Subject to the terms and conditions hereof,
on the Closing Date (as defined in Section 2), Xxxxxx shall purchase, and L&R
shall sell, all of L&R's right, title and interest in and to the Shares for an
aggregate purchase price of $100,000 or $.08333 per share (the "Purchase
Price"). The Purchase Price shall be payable as provided in Section 2.
2. THE CLOSING. Subject to the terms and conditions hereof, the
closing of the purchase and sale of the Shares described in Section 1 (the
"Closing") shall take place at the offices of Xxxxx Xxxxxx & Xxxx, LLP at 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such other place as the parties
shall mutually agree. On the Closing Date: (i) L&R will deliver to Xxxxxx
certificates representing the Shares, duly endorsed in blank or accompanied by
duly executed stock powers or other instruments of transfer, in proper form for
transfer, with all signatures guaranteed, free and clear of all liens, charges,
claims or other encumbrances of any nature (collectively "Liens"); and (ii)
Xxxxxx will deliver the Purchase Price to L&R, by wire transfer of immediately
available funds to an account designated at least three days prior to the
Closing Date (or such lesser time period as is reasonably practicable). The
Closing Date will be on or before September 30, 1996.
3. REPRESENTATIONS AND WARRANTIES.
(a) L&R hereby represents, warrants and, where applicable,
covenants to Xxxxxx as follows:
(i) L&R is the beneficial and record owner of all of
the Shares. All of such Shares have been duly authorized and validly issued and
are fully paid and non-
assessable. L&R owns the Shares free and clear of all Liens. On the Closing
Date, Xxxxxx will acquire from L&R good and marketable title to the Shares, free
and clear of all Liens;
(ii) L&R is a corporation duly organized, validly
existing and in good standing under the laws of the State of New York and has
full corporate right and power and all authority and approvals required to enter
into, execute and deliver this Agreement and to perform fully its obligations
hereunder. This Agreement has been duly executed and delivered and is the valid
and binding obligation of L&R enforceable in accordance with its terms;
(iii) Neither the execution and delivery of this
Agreement by L&R nor the consummation by L&R of the transactions contemplated
hereby will (a) conflict with or result in a breach of or constitute or result
in a default under its certificate of incorporation and by-laws or any judgment,
order, law, regulation or ruling of any court or governmental authority,
domestic or foreign, to which L&R is subject or by which any of its assets may
be bound, or (b) conflict with or result in a breach of or constitute or result
in a default under any agreement, instrument or obligation to which L&R is a
party or by which any of its assets may be bound; and
(iv) No consent, authorization or approval of, or
filing or registration with, any governmental or regulatory authority or any
other person or entity is required in connection with the execution and delivery
of this Agreement by L&R and the consummation of the transactions contemplated
hereby by L&R.
(b) Xxxxxx hereby represents, warrants and, where applicable,
covenants to L&R as follows:
(i) Xxxxxx has all power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
This Agreement has been duly executed and delivered and constitutes the valid
and binding obligation of Xxxxxx, enforceable in accordance with its terms;
(ii) Neither the execution and delivery of this
Agreement by Xxxxxx nor the consummation by Xxxxxx of the transactions
contemplated hereby will conflict with or result in a breach of or constitute or
result in a default under any agreement, instrument or obligation to which
Xxxxxx is a party or by which any of his assets may be bound;
(iii) No consent, authorization or approval of, or
filing of registration with, any governmental or regulatory authority or any
other person or entity is required in connection with the execution and delivery
of this Agreement by Xxxxxx and the
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consummation of the transactions contemplated hereby by Xxxxxx;
(iv) Xxxxxx is an "accredited investor" as defined in
Section 2(15) of the Securities Act of 1933, as amended (the "Act"), and in Rule
501 promulgated thereunder. Xxxxxx has such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of an investment in the Shares. Xxxxxx believes that such an investment
is suitable for him based upon his investment objectives and financial needs;
and
(v) The Shares being acquired by Xxxxxx hereunder are
being acquired for his own account for investment purposes and not with a view
to or for resale or distribution thereof within the meaning of the Securities
Act of 1933, as amended (the "Securities Act"); nor with any present intention
of selling or otherwise disposing of all or any part of the Shares. Xxxxxx
agrees that he shall not sell, assign, or transfer any of the Shares except (i)
pursuant to a Registration Statement under the Securities Act which has become
effective and is current with respect to the Shares, or (ii) pursuant to a
specific exemption from registration under the Securities Act, but only upon
Xxxxxx first having obtained a prior favorable written opinion from counsel to
American Film Technologies, Inc. with respect to such sale, assignment or
transfer. Xxxxxx acknowledges that the Shares being acquired by him hereunder
have not been registered under the Securities Act and will be "restricted
securities", as that term is defined under the Securities Act and the General
Rules and Regulations promulgated thereunder, with specific limitations on their
sale, assignment or transfer unless registered under the Securities Act or an
exemption from such registration is available. Xxxxxx further acknowledges that
the exemption from registration afforded by the General Rules and Regulations
under the Securities Act depends upon the satisfaction of various conditions and
that, if applicable, such rules afford the basis for sales of restricted
securities (such as the Shares) only in limited amounts and, in the case of
securities to which such rules are not applicable, compliance with some other
exemption of the Securities Act will be required. Xxxxxx acknowledges that L&R
will have no obligation to take any step necessary to obtain, on behalf of
Xxxxxx, any exemption from registration under the Securities Act. The
certificates representing the Shares to be transferred to Xxxxxx pursuant to
this Agreement shall bear the standard restrictive stock language.
4. OTHER AGREEMENTS.
(a) SURVIVAL OF WARRANTIES. All statements contained in this
Agreement and in any certificate, instrument or document delivered by or on
behalf of L&R or Xxxxxx pursuant hereto or in connection with the transactions
contemplated hereby, shall
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be deemed representations and warranties hereunder by such party. All
representations, warranties and agreements set forth herein shall survive the
Closing Date.
(b) INDEMNIFICATION.
(i) From and after the Closing Date, L&R, on the one
hand, and Xxxxxx, on the other hand, shall indemnify and save harmless the other
(in such capacity, an "Indemnified Party") against any loss, claim, liability,
expense (including its reasonable attorneys' fees) or other damage
(collectively, "Losses") caused by or arising out of (i) the failure by the
party against whom indemnification is sought (the "Indemnifying Party") to
perform any of its covenants or agreements in this Agreement or (ii) the breach
of any representation or warranty made by or on behalf of the Indemnifying Party
in this Agreement.
(ii) The Indemnified Party shall notify the
Indemnifying Party of any claim to be asserted under this Section 4(b) against
the Indemnifying Party as soon as practicable after the Indemnified Party
receives notice of or otherwise has actual knowledge of such claim, and shall
provide to the Indemnifying Party as soon as practicable after the Indemnified
Party receives notice of or otherwise has actual knowledge of such claim, and
shall provide to the Indemnifying Party as soon as practicable thereafter all
information and documentation necessary to support and verify the claim being
asserted.
(iii) Promptly after receipt by the Indemnified Party of
notice of the commencement by any third party of any action, suit or proceeding
which might result in the Indemnifying Party becoming obligated to indemnify or
make any other payment to the other under this Agreement, the Indemnified Party
shall, if a claim in respect thereof is to be made against the Indemnifying
Party under this Agreement, notify the Indemnifying Party forthwith in writing
of the commencement thereof. The failure of the Indemnified Party to so notify
the Indemnifying Party shall not relieve such party from any liability which it
or he may have on account of this indemnification or otherwise, except to the
extent that such party is materially prejudiced thereby. The Indemnifying Party
shall have the right, within thirty days after being so notified, to assume the
defense of such litigation or proceeding with counsel reasonably satisfactory to
the Indemnified Party. In any such litigation or proceeding the defense of
which the Indemnifying Party shall have so assumed, the Indemnified Party shall
have the right to participate therein and retain its own counsel at its own
expense unless (A) the parties shall have mutually agreed to the retention of
such counsel or (B) the named parties to any such litigation or proceeding
(including impleaded parties) include both the Indemnifying Party and the
Indemnified Party, and representation of
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both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them; in either such case, such separate
counsel may be retained by the Indemnified Party at the Indemnifying Party's
expense. To the extent that the settlement of such an action or proceeding, the
defense of which has been assumed by the Indemnifying Party, involves the
payment of money, the Indemnifying Party shall have the right, in consultation
with the Indemnified Party, to settle those aspects dealing only with the
payment of money. Notwithstanding the foregoing, in connection with any such
defense or settlement, the Indemnifying Party shall not enter into a consent
decree involving injunctive relief or consent to an injunction without the
Indemnified Party's prior written consent, which consent shall not be
unreasonably withheld. The Indemnified Party shall cooperate with the
Indemnifying Party in the defense of any action, suit or proceeding assumed by
the Indemnifying Party.
(c) EXPENSES. Except as otherwise provided herein, each party
shall bear its own expenses (including those of counsel) incurred in connection
with this Agreement and the transactions herein contemplated.
5. FURTHER ASSURANCES. Each party hereto agrees to execute and
deliver such other documents and instruments and take such other actions as the
other party may reasonably request in order to consummate the sale and carry out
the transactions contemplated by this Agreement.
6. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement (including the documents
and instruments referred to herein) constitutes the entire agreement and
supersedes all other prior agreements and understandings, both oral and written,
between the parties with respect to the subject matter hereof. This Agreement
may not be amended except by an instrument in writing signed on behalf of each
of the parties hereto.
(b) GOVERNING LAW. This Agreement is governed by and construed
and enforced in accordance with the laws of the State of New York applicable to
contracts to be performed wholly within such State.
(c) HEADINGS AND EXHIBITS. The headings of the various sections
and paragraphs herein are for convenience of reference only and shall not define
or limit any of the terms or provisions hereof.
(d) ASSIGNMENT. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted
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assigns, but neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by a party without the prior written
consent of the other party hereto.
7. RIGHTS AND REMEDIES. The rights and remedies of the parties
hereunder shall not be mutually exclusive, and the exercise of one or more of
the provisions of this Agreement shall not preclude the exercise of any other
provisions. Each of the parties confirms that damages at law may be an
inadequate remedy for a breach or threatened breach of any provision hereof.
The respective rights and obligations hereunder shall be enforceable by specific
performance, injunction or other suitable remedy, but nothing contained
hereunder is intended to or shall limit or affect any rights at law or by
statute or otherwise of any party aggrieved as against the other party for a
breach or threatened breach of any provisions hereof, it being the intention of
this Section to make clear the agreement of the parties that the respective
rights and obligations of the parties hereunder shall be enforceable in equity
as well as at law or otherwise.
8. NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and delivered at the addresses designated below,
or mailed by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows, or to such other address or addresses as may
hereafter be furnished by one party to the other party in compliance with the
terms hereof:
If to L&R, to :
L&R Holdings, Inc.
000 Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxx, President
with a copy to:
Xxxxx Xxxxxx & Xxxx, LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxxxx, Esq.
If to Xxxxxx to:
X.X. Xxxxxx
000 Xxxx Xxxx
Xxxxxxxx, XX 00000
All such notices and communications shall be effective when delivered
at the designated addresses or five days after deposited in the mails in
conformity with the provisions hereof.
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9. COUNTERPARTS. This Agreement may be executed in counterparts
each of which shall be deemed an original and all of which shall constitute one
and the same Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed as of the day and year first above written.
L&R Holdings, Inc.
By: /s/Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, President
/s/X.X. Xxxxxx
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X.X. Xxxxxx
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