Exhibit 4.01
THE COMMON STOCK TO BE ISSUED PURSUANT TO THIS AGREEMENT HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THE COMMON STOCK
ISSUED PURSUANT HERETO MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT OR AN
EXEMPTION FROM REGISTRATION IS AVAILABLE.
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (this "Agreement"), dated January 15,
2001, is by and between Xxxx Products, Inc. (Company named applied to be changed
to "Canadian Rockport Homes International, Inc.), a Delaware corporation,
located at Xxxxx 000, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, X.X., Xxxxxx X0X 0X0
("Xxxx") and Xxxxxx Xxxxxxxx Xxxxx, located at 0000 Xxxx 00xx Xxxxxx, Xxxxxxxxx,
X.X., Xxxxxx X0X 0X0 ("Investor").
Agreement
---------
NOW, THEREFORE, for good and valuable consideration, the receipt of which
is hereby acknowledged, the parties agree as follows:
1. Sale and Issuance of Shares. In consideration for Investor's
-----------------------------
consideration and covenants set forth herein, Xxxx shall issue to Investor
Xxxxxx Xxxxxxxx Xxxxx, Twenty Five Thousand (25,000) shares of common stock
of Xxxx (the "Shares") on, or before, the Issuance Date as defined herein.
Upon payment, the Shares shall be fully paid, duly issued, and
non-assessable. Payment for the Shares shall be $2.00 per share for a total
price of $50,000.00. Such payment shall be made upon the execution of this
Agreement.
2. Investor Representations and Warranties. In order to induce
------------------------------------------
Xxxx to accept this Agreement, Investor hereby represents and warrants to
Xxxx as follows:
(a) Investor Intent. The Investor is acquiring the Shares herein
----------------
subscribed solely for her own account as principal, for investment purposes only
and not with a view to the resale or distribution thereof, in whole or in part,
and the Investor will hold the Shares as an investment.
(b) Accredited Investor. Investor has the financial ability to
--------------------
bear the economic risk of an investment in Xxxx, has adequate means of providing
for her current needs and personal contingencies, has no need for liquidity in
such investment and could afford a complete loss of such investment. With
respect to the investment made under this Agreement, Investor is an "Accredited
Investor" as such term is defined in Regulation D promulgated by the Act.
Investor understands that the categories included within the definition of
"Accredited Investor" which pertain to natural persons are as follows: (i) any
natural person whose individual net worth, or joint net worth with that person's
spouse, at the time of her purchase, exceeds One Million Dollars ($1,000,000)
and (ii) any natural person who had an individual income in excess of Two
Hundred Thousand Dollars ($200,000) in each of the two most recent years or
joint income with that person's spouse in excess of Three Hundred Thousand
Dollars ($300,000) in each of those years and has a reasonable expectation of
reaching the same income level in the current year.
(c) Opportunity to Investigate. Investor or her Investment
----------------------------
Advisor (if any) has been given a full opportunity to ask questions of and to
receive answers from the officers, agents and representatives of Xxxx concerning
the terms and conditions of this Agreement and the business of Xxxx and to
obtain such other information that the Investor or her Investment Advisor (if
any) desires in order to evaluate an investment in Xxxx, and all such questions
have been answered to the full satisfaction of the Investor. Investor
acknowledges that the Investor or the Investor's Investment Advisor (if any) has
had access to the same kind of information concerning Xxxx that is required by
Schedule A of the Act to the extent that Xxxx possesses such information.
(d) Reviewed Merits With Investments Advisor. Investor has
--------------------------------------------
reviewed the merits of an investment in Xxxx with tax and legal counsel and an
investment advisor to the extent deemed advisable by Investor.
(e) Acknowledgment of Risks. Investor acknowledges and
-------------------------
understands that (i) Xxxx is in a very competitive field, and expects to
encounter competition from other companies which have substantially more
resources and experience, and are better known, than Xxxx; (ii) Xxxx'x future is
dependent upon its acceptance in the marketplace, and there can be no assurances
that acceptance will be achieved; (iii) although Xxxx cannot accurately predict
its future operating results, it will incur losses from operations subsequent to
the date hereof and extending into an indeterminable time in the future and
there can be no assurances that it will ever achieve profitability; (iv) the
aggregate number of capital shares sold by Xxxx, from time to time, and the
price at which such shares are sold, will be determined by the Board of
Directors of Xxxx, in its discretion, giving consideration to the needs of Xxxx
to obtain financing, and there can be no assurances that Xxxx will not sell
capital shares in the future at a lower per-share price; (v) Xxxx will require
additional financing in the future, has no commitments for such financing at
this time and no assurances can be given that Xxxx will be able to obtain such
financing, on terms acceptable to Xxxx, at the time it is required, and (vi) in
purchasing the Shares, Investor is making a highly speculative investment.
(f) Shares Not Registered. Investor understands that the Shares
-----------------------
have not been registered under the Act, or the securities laws of certain
states, in reliance upon specific exemptions from registration thereunder, and
he agrees that her Shares may not be sold, offered for sale, transferred,
pledged, hypothecated or otherwise disposed of except pursuant to a registration
in compliance with the Act and applicable state securities laws, pursuant to
Rule 144 promulgated under the Act and similar provisions under applicable state
securities laws, or pursuant to an exemption from registration.
(g) No Federal or State Endorsement. Investor understands that no
-------------------------------
federal or state agency has made any finding or determination as to the fairness
of an investment in, or any recommendation or endorsement of, the Shares.
(h) Additional Financing. The Investor understands that Xxxx will
--------------------
require additional financing in the figure, that Xxxx has no commitments for
such financing at this time and has no assurances that it will be able to obtain
additional financing, or if obtained what price, terms and conditions will be
attached to such financing. The Investor acknowledges that Xxxx intends to
issue substantial shares in several rounds of future financings, and that in the
course of such issuances, the Investor's percentage ownership in Xxxx will be
substantially diluted.
(i) Independent Investigation. In making her decision to purchase
-------------------------
the Shares, the Investor has relied solely upon independent investigations made
by her or by her Investment Advisor (if any) and information received from Xxxx.
She has received no representation or warranty from Xxxx or any of its
affiliates, employees or agents, except as set forth herein.
(j) Accuracy and Survival of Representations. Each representation
----------------------------------------
and warranty of Investor contained herein and all information furnished by
Investor to Xxxx is true, correct and complete in all respects. All
representations and warranties set forth above or in any other written statement
or document delivered by Investor in connection with the transaction
contemplated hereby will be true, correct and complete in all respects on and as
of the date of the issuance of the Shares, as if made on and as of such date and
shall survive such issuance.
Xxxx has obtained the representations and warranties set forth above for
informational purposes, and such representations and warranties should not be
construed as indicative of any exemption Xxxx may claim from the registration
requirements under the Act.
(k) Xxxx Representations and Warranties. In order to induce
--------------------------------------
Investor to accept this Agreement, Xxxx hereby represents and warrants to
Investor, as follows:
(a) Legal Authority. It has full and valid legal authority to
----------------
enter into this Agreement;
(b) No Contractual Bar. The entry into this Agreement will not
--------------------
violate any contract or agreement to which it is a party;
(c) Stock Sale Information. The information provided by Xxxx to
------------------------
Investor concerning this sale of Xxxx common stock is true, correct, and
complete;
(d) Accuracy and Survival of Representations. Each representation
----------------------------------------
and warranty of Xxxx contained herein and all information furnished by Xxxx is
true, correct and complete in all respects. All representations and warranties
set forth above or in any other written statement or document delivered by Xxxx
in connection with the transaction contemplated hereby (and Investor's due
diligence) will be true, correct and complete in all respects on and as of the
date of the issuance of the Shares, as if made on and as of such date and shall
survive such issuance.
3. Legends and Restrictions.
--------------------------
(a) Legend. Investor understands and agrees that the
------
certificate(s) representing Shares will bear legends in the following form:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE SECURITIES
LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS. THE
ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND
SUBSTANCE REASONABLY AND IN GOOD FAITH SATISFACTORY TO THE ISSUER TO THE
EFFECT THAT THE PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT
AND ANY APPLICABLE STATE SECURITIES LAWS."
(b) Compliance with Applicable Securities Laws. Transfer of the
---------------------------------------------
Shares by Investor shall only be made in compliance with all applicable
securities laws. Xxxx may refuse to register any transfer of the Shares by
Investor which Xxxx reasonably and in good faith believes is not in compliance
with the applicable securities laws. Xxxx'x right to do so shall survive any
expiration or termination of this Agreement.
(c) Issuance Date. Xxxx is in the process of changing its name
--------------
to Canadian Rockport Homes International, Inc., and authorizing additional
capital stock. As used herein the term "Issuance Date" shall refer to that day
which is five (5) business days after the effective date of the name change and
of the additional stock authorization. The Issuance Date shall be on, or
before February 20, 2001.
4. General Provisions.
-------------------
(a) Notices. Except as expressly provided herein, all notices,
-------
requests or other communications required hereunder shall be in writing and
shall be given personal delivery, international overnight courier service, or by
certified or registered mail, postage prepaid, return receipt requested,
addressed to the respective party at the applicable address set forth herein, or
to any party at such other addresses as shall be specified in writing by such
party to the other parties in accordance with the terms and conditions of this
Section. All notices, requests or communications shall be deemed effective upon
personal delivery, or seven (7) days following deposit in the mail, or two (2)
business days following deposit with any international overnight courier
service.
In order to be effective, any such Notice shall be given, as follows:
To Xxxx: Xxxx Products, Inc.
Xxxxx 000
000 Xxxx Xxxxxx Xxxxxx,
Xxxxxxxxx, X.X.
Xxxxxx X0X 0X0
To Xx. Xxxxx: Xxxxxx Xxxxxxxx Xxxxx
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, X.X.
Xxxxxx X0X 0X0
Notice of change of address shall be given by written notice in the manner
detailed in this paragraph. Rejection or other refusal to accept or the failure
to deliver due to any change of address of which no notice was given shall not
effect the time at which such notice shall be deemed to have been given and
shall constitute receipt of such communication.
(b) Jurisdiction, Venue and Governing Law. This Agreement shall
---------------------------------------
be governed by and construed and enforced in accordance with the laws of the
Province of British Columbia (regardless of that jurisdiction or any other
jurisdiction's choice of law principles). To the extent permitted by law, the
parties hereto agree that all actions or proceedings arising in connection
herewith, shall be litigated in the state and federal courts located in
Vancouver, British Columbia, Canada, and each party hereby waives any right that
such party may have to assert the doctrine of Forum Non Conveniens or to object
to venue. The parties each hereby stipulate that the courts located in
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx, shall have personal jurisdiction and venue
over each party for the purpose of litigating any such dispute, controversy or
proceeding arising out of or related to this Agreement.
(c) No Assignment. This Agreement is personal to Investor, and
--------------
Investor may not assign any rights or delegate any responsibilities hereunder
without the prior approval of Xxxx.
(d) Amendments. This Agreement shall be binding upon and inure to
----------
the benefit of the parties and their respective successors, heirs and permitted
assigns. This Agreement may not be altered, modified, changed or discharged
except in writing signed by both the parties.
(e) Validity. If any one or more of the provisions (or any part
--------
thereof) of this Agreement shall be held to be invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions (or any part thereof) shall not in any way be affected or impaired
thereby.
(f) INVESTOR AND XXXX EACH ACKNOWLEDGE THAT SHE AND IT HAVE HAD
THE OPPORTUNITY TO CONSULT WITH THE ADVISOR OF HER OR ITS CHOICE AND THAT SHE
AND IT HAVE FREELY AND VOLUNTARILY ENTERED INTO THIS AGREEMENT.
(g) Time of Essence; Cooperation. Time is of the essence in the
-------------------------------
performance of the obligations of the parties in connection with this Agreement.
All parties shall cooperate fully in carrying out the terms of this Agreement
and shall prepare and execute all documents reasonably necessary to carry out
the terms of this Agreement.
(h) Attorney's Fees. In the event that any action or proceeding
----------------
is commenced by either party hereto for the purpose of enforcing any provision
of this Agreement, the successful or prevailing party shall recover reasonable
attorney's fees and other costs incurred in such action or proceeding.
IN WITNESS WHEREOF, each of the parties hereby executes this Agreement of
the date first set forth above.
Xxxx Products, Inc.
By: /s/ Xxxxxxx Xxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx, Director
INVESTOR: /s/ Xxxxxx Xxxxx
---------------------------------
Xxxxxx Xxxxxxxx Xxxxx
