Exhibit 10.3 Acquisition Agreement
ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT (the "Agreement"") is executed on or about May 15,
2004 by and among Xxxxxxx X. Xxxxxxxx ("Xxxxxxxx" or "BUYER"), a natural person,
and Fleetclean System, Inc., a Texas corporation ("SELLER").
WHEREAS, SELLER owns One Thousand (1,000) shares of $.01 par value common stock
of Fleetclean Chemicals, Inc., a Texas corporation ("FCI") that represents 100%
of the outstanding capital stock of FCI;
WHEREAS, SELLER desires to sell to BUYER and BUYER desires to purchase from
SELLER One Thousand (1,000) shares of $.01 par value common stock of Fleetclean
Chemicals, Inc., a Texas corporation (the "FCI SHARES") that represents 100% of
the outstanding capital stock of FCI, subject to the terms and conditions of
this Agreement; and
WHEREAS, it is intended that the offer and sale of the securities be consummated
in accordance with the exempted transaction provisions of Section 4 of the
Securities Act of 1933, the Securities Act Rules and subsequent interpretations
of these provisions.
NOW, THEREFORE, for and in consideration of the mutual promises herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. The Purchase and Sale of the FCI SHARES.
Subject to the terms and conditions set forth herein, BUYER agrees to purchase
the FCI SHARES from SELLER. The Consideration to be paid to the SELLER by the
BUYER on the Closing Date for the FCI SHARES shall (a) equal 100% of the net
tangible book value (i.e., total assets less intangible assets and liabilities)
of FCI on April 1, 2004 and (b) the Release of Claims and Indemnity Agreement
set forth on pages 6 -7.
2. Closing.
A. CLOSING DATE. The closing of the purchase and sale contemplated by this
Agreement (the "Closing Date") shall occur as soon as possible. To the extent
allowed under Texas law and to the extent the transaction can be properly
reported under the Generally Accepted Accounting Principals applicable to Small
Business Issuers who file periodic reports with the SEC under Section 12(g) of
the Securities Exchange Act of 1934, the SELLER and BUYER agree that the Closing
Date shall be as of 11:59 p.m. March 31, 2004, although stockholder approval of
the transaction may occur somewhat later in time.
B. TRANSACTIONS AND DOCUMENT EXCHANGE AT CLOSING. Prior to or at the Closing,
the following transactions shall occur and documents shall be exchanged, all of
which shall be deemed to occur simultaneously:
(2) By BUYER. BUYER will deliver, or cause to be delivered, to SELLER:
(i) A fully executed release of all claims, including, but not
limited to any claims for past due wages, salary, benefits,
stock options, warrants, loans, advances, (sums listed as due
as of March 31, 2004 in SELLER's Form 10-QSB $166,685);
(ii) An executed Release of Claims and Indemnity Agreement against
any undisclosed liabilities of SELLER arising prior to May 14,
2004, in the form set forth on pages 6-7 of this Agreement;
and
(iii) Such other documents, instruments, and/or certificates, if
any, as are required to be delivered pursuant to the
provisions of this Agreement, or which are reasonably
determined by the parties to be required to effectuate the
transactions contemplated in this Agreement, or as otherwise
may be reasonably requested by SELLER in furtherance of the
intent of this Agreement.
(2) By SELLER. SELLER will deliver, or cause the following to be delivered to
BUYER:
(i) The FCI SHARES;
(ii) Such other documents, instruments, and/or certificates, if
any, as are required to be delivered pursuant to the
provisions of this Agreement, or which are reasonably
determined by the parties to be required to effectuate the
transactions contemplated in this Agreement, or as otherwise
may be reasonably requested by BUYER in furtherance of the
intent of this Agreement.
(C) POST-CLOSING DOCUMENTS. From time to time after the Closing, upon the
reasonable request of any party, the party to whom the request is made shall
deliver such other and further documents, instruments, and/or certificates as
may be necessary to more fully vest in the requesting party the Consideration or
the SELLERS Shares, as provided for in this Agreement, or to enable the
requesting party to obtain the rights and benefits contemplated by this
Agreement.
3. Private Offering.
A. PRIVATE OFFERING. BUYER and SELLERS understand each that the sale and
exchange of securities contemplated herein constitutes a private, arms-length
transaction between a willing seller and a willing buyer without the use or
reliance upon a broker, distribution or securities underwriter.
B. PURCHASE FOR INVESTMENT. Neither BUYER nor SELLERS are underwriters of, or
dealers in the securities to be sold and exchanged hereunder.
C. INVESTMENT RISK. Because of their financial position and other factors, the
transaction contemplated by this Agreement may involve a high degree of
financial risk, including the risk that one or both parties may lose its entire
investment.
D. ACCESS TO INFORMATION. BUYER and SELLERS and their advisors have been
afforded the opportunity to discuss the transaction with legal and accounting
professionals and to examine and evaluate the financial impact of the sale and
exchange contemplated herein.
4. Representations and Warranties.
BUYER hereby covenants with and represents and warrants to SELLER that:
BUYER served as the Chief Executive Officer and Chairman of SELLER since 1986.
BUYER personally approved the creation of FCI and the Asset and Liability
Contribution Agreement dated March 31, 2004 between Fleetclean Chemicals, Inc.
and SELLER so that BUYER is intimately familiar with all of the assets and
liabilities and operating issues that have confronted and will confront both
SELLER and Fleetclean Chemicals, Inc. during the next 12 months.
SELLER hereby covenants with and represents and warrants to BUYER that:
A. Fleetclean Chemicals, Inc. is a newly formed corporation with no history of
operations. Fleetclean Chemicals, Inc. was incorporated on March 29, 2004 and
received certain assets and liabilities under that certain Asset and Liability
Contribution Agreement dated March 31, 2004 between Fleetclean Chemicals, Inc.
and SELLER.
5. Conditions Precedent to Closing.
All obligations under this Agreement shall be satisfactory to both BUYER and
SELLER and their legal counsel.
6. Termination.
This Agreement may be terminated at anytime prior to the date of Closing by
either party if (a) there shall be any actual or threatened action or proceeding
by or before any court or any other governmental body which shall seek to
restrain, prohibit, or invalidate the transaction contemplated by this
Agreement, and which, in the judgment of such party giving notice to terminate
and based upon the advice of legal counsel, makes it inadvisable to proceed with
the transaction contemplated by this Agreement.
7. Miscellaneous.
A. AUTHORITY. The persons executing this Agreement are duly authorized to do so
and each person has taken all action required by law or otherwise to properly
and legally execute this Agreement.
B. ENTIRE AGREEMENT. This Agreement sets forth the entire understanding between
the parties hereto and no other prior written or oral statement or agreement
shall be recognized or enforced.
C. SEVERABILITY. If a court of competent jurisdiction determines that any clause
or provision of this Agreement is invalid, illegal or unenforceable, the other
clauses and provisions of the Agreement shall remain in full force and effect
and the clauses and provision which are determined to be void, illegal or
unenforceable shall be limited so that they shall remain in effect to the extent
permissible by law.
D. ASSIGNMENT. None of the parties hereto may assign this Agreement without the
express written consent of the other parties and any approved assignment shall
be binding on and inure to the benefit of such successor or, in the event of
death or incapacity, on assignor's heirs, executors, administrators and
successors.
E. APPLICABLE LAW. This Agreement has been negotiated and is being contracted
for in the State of Texas. The parties agree that this Agreement shall be
governed by the laws of the State of Texas, notwithstanding any conflict-of-law
provision to the contrary.
F. ATTORNEY'S FEES. If any legal action or other proceeding (non-exclusively
including arbitration) is brought for the enforcement of or to declare any right
or obligation under this Agreement or as a result of a breach, default or
misrepresentation in connection with any of the provisions of this Agreement, or
otherwise because of a dispute among the parties hereto, the prevailing party
will be entitled to recover actual attorney's fees (including for appeals and
collection) and other expenses incurred in such action or proceeding, in
addition to any other relief to which such party may be entitled.
G. NO THIRD PARTY BENEFICIARY. Nothing in this Agreement, expressed or implied,
is intended to confer upon any person, other than the parties hereto and their
successors, any rights or remedies under or by reason of this Agreement, unless
this Agreement specifically states such intent.
H. COUNTERPARTS. It is understood and agreed that this Agreement may be executed
in any number of identical counterparts, each of which may be deemed an original
for all purposes.
I. FURTHER ASSURANCES. At any time, and from time to time after the Closing,
each party hereto will execute such additional instruments and take such action
as may be reasonably requested by the other party to confirm or perfect title to
the SHARES to be transferred hereunder or otherwise to carry out the intent and
purposes of this Agreement.
J. AMENDMENT OR WAIVER. Every right and remedy provided herein shall be
cumulative with every other right and remedy, whether conferred herein, at law,
or in equity, and may be enforced concurrently herewith, and no waiver by any
party of the performance of any obligation by the other shall be construed as a
waiver of the same or any other default then, theretofore, or thereafter
occurring or existing. At any time prior to Closing, this Agreement may be
amended by a writing signed by all parties hereto.
K. HEADINGS. The section and subsection headings in this Agreement are inserted
for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
L. FACSIMILE. A facsimile, telecopy or other reproduction of this instrument may
be executed by one or more parties hereto and such executed copy may be
delivered by facsimile or similar instantaneous electronic transmission device
pursuant to which the signature of or on behalf of such party can be seen, and
such execution and delivery shall be considered valid, binding and effective for
all purposes. At the request of any party hereto, all parties agree to execute
an original of this instrument as well as any facsimile, telecopy or other
reproduction hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and year
first written above.
BUYER
Xxxxxxx X. Xxxxxxxx
By: /S/ XXXXXXX X. XXXXXXXX
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Name: Xxxxxxx X. Xxxxxxxx
SELLER
Fleetclean Systems, Inc.
By: /S/ XXXXXXX X. XXXXXXXX
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Name: Xxxxxxx X. Xxxxxxxx
Title: President
RELEASE OF CLAIMS AND INDEMNITY AGREEMENT
KNOW ALL MEN
BY THESE PRESENTS
THAT THE UNDERSIGNED, XXXXXXX X. XXXXXXXX, for Ten Dollars ($10.00), plus other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged hereby releases and forever discharges Fleetclean Systems, Inc., a
Texas corporation, its directors, officers, employees, and agents, of and from
any and all manner of actions and causes of action, suits, debts, dues, sums of
money, accounts, controversies, agreements, promises, damages, judgments,
executions, claims, and demands whatsoever, in law or in equity, and
particularly from all claims and demands whatsoever, arising in or out of, or in
connection with, common or preferred stock transactions, any stock options or
stock warrants, any past due wages, compensation or money advanced on behalf of
Fleetclean Systems, Inc. (including, but not limited to the $166,685 mentioned
in its Form 10-KSB for 12/31/03) or any other matter, which the undersigned ever
had, or now possesses, or which the undersigned, or its successors and assigns,
hereafter can, shall, or may have against Fleetclean Systems, Inc., a Texas
corporation, its directors, officers, employees, and agents, for, upon, or by
reason of any matter, cause or thing whatever.
It is expressly understood that Section 1542 of the California Civil Code
provides as follows:
GENERAL RELEASE; EXTENT. A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
The provisions of Section 1542 of the California Civil Code, as well as the
provisions of all comparable, equivalent and similar statutes and principles of
common law of the United States and of any and all of the states of the United
States, if in any way applicable, are hereby knowingly and voluntarily waived
and relinquished and the undersigned expressly includes in this Release any
unknown claims that the undersigned may have against Fleetclean Systems, Inc., a
Texas corporation, its directors, officers, employees, and agents.
XXXXXXX X. XXXXXXXX shall indemnify and hold Fleetclean Systems, Inc., a Texas
corporation harmless from any and all liability, cost, loss or damage which
Fleetclean Systems, Inc., a Texas corporation, may suffer or incur as a result
of any claim, demand or judgment against Fleetclean Systems, Inc., a Texas
corporation arising out of a claim by any third party which constitutes a breach
of any representation or warranty by XXXXXXX X. XXXXXXXX, under the Stock
Purchase Agreement by and between XXXXXXX X. XXXXXXXX and Systom Trust Joint
Venture dated May 14, 2004, or that is due to the assertion of a claim by any
third party or the attempt to collect debt by any third party purportedly due
from Fleetclean Systems, Inc., and not specifically set forth in the audited or
unaudited financial statements of Fleetclean Systems, Inc., or otherwise,
including the reference below, prior to May 14, 2004; provided, however, XXXXXXX
X. XXXXXXXX shall have no liability under this Release of Claims and Indemnity
Agreement to the extent such loss, cost or damage is the direct result of the
actions or omissions of management of Fleetclean Systems, Inc. on or after May
14, 2004. For the purpose of specificity and not by way of limitation, attached
to this Release of Claims and Indemnity Agreement are 56 pages with fax header
05/11/2004 9362982769 Fleetclean Systems that represent a fax cover sheet,
account payable analysis, and 54 pages of letters to and returned by creditors;
and 4 pages with fax header 05/13/2004 9362982769 Fleetclean Systems that
represent two additional letters to and returned by creditors. Also, attached
hereto are the letter agreements with the 12 holders of $237,500 Convertible
Debentures of Fleetclean Systems, Inc.
Dated: May 15, 2004
Xxxxxxx X. Xxxxxxxx
/S/ XXXXXXX X. XXXXXXXX
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Xxxxxxx X. Xxxxxxxx
