STOCK ACQUISITION AGREEMENT
THIS STOCK ACQUISITION AGREEMENT ("Agreement"), dated for reference
purposes as of January 2, 2000, is by and among NETSOL INTERNATIONAL, INC., a
Nevada corporation (the "Company"), and the shareholders whose names appear on
the signature page hereto (each, a "Shareholder" and collectively, the
"Shareholders") of ABRAXAS SOFTWARE PTY, LTD. ("Abraxas").
R E C I T A L S
A. The Shareholders own certain shares of capital stock of Abraxas as
set forth in attached Schedule A (the "Abraxas Shares") which total 100% of the
total issued and outstanding shares of Abraxas.
B. Company desires to purchase 100% of the Abraxas Shares from
Shareholders and Shareholders desire to sell such shares to Company upon the
terms and subject to the conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:
ARTICLE 1
SALE AND ISSUANCE OF SHARES AND OTHER TERMS
Subject to the terms and conditions herein set forth, and on the basis
of the representations, warranties and agreements herein contained, at Closing
(as defined below):
1.1 CONVEYANCE OF ABRAXAS SHARES. Shareholders will sell, assign,
transfer and convey all of their respective right, title and interest in and to
the Abraxas Shares to Company, and Company shall acquire the Abraxas Shares from
the Shareholders.
1.2 ISSUANCE OF COMPANY SHARES. Company shall issue to Shareholders
shares of common stock of Company (collectively, the "Company Shares") as set
forth in Schedule B .
1.3 NO BROKERAGE COMMISSION. Shareholders have not employed any broker,
agent or finder in connection with any transaction contemplated by this
Agreement and hereby indemnifies Company against any liability for a brokerage
commission or finders fee of any description incurred by Company with respect to
any transaction contemplated by this Agreement. Company has not employed any
broker, agent or finder in connection with any transaction contemplated by this
Agreement and hereby indemnifies Shareholders against any liability for a
brokerage commission or finders fee of any description incurred by Shareholders
with respect to any transaction contemplated by this Agreement.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. Each Shareholder
represents and warrants to Company with respect to only himself, herself, or
itself, as of the date hereof and as of the Closing, as follows:
2.1.1 ABRAXAS SHARES. Shareholder is the lawful beneficial and
record owner of the Abraxas Shares as set forth in attached Schedule A and has
not conveyed, pledged, assigned or otherwise transferred such shares or any
interest therein. All of the Abraxas Shares owned by such Shareholder will be
conveyed hereunder free and clear of all liens, security interests,
encumbrances, pledges, restrictions, charges, demands, and claims of any kind
and nature whatsoever, whether direct or indirect or contingent.
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2.1.2 EXPERIENCE. (i) Shareholder has a preexisting personal or
business relationship with Company or one or more of its officers, directors, or
control persons, or (ii) by reason of Shareholder's business or financial
experience, Shareholder is capable of evaluating the risks and merits of an
investment in the Company Shares and of protecting his, her or its own interests
in connection with this investment.
2.1.3 PURCHASE ENTIRELY FOR OWN ACCOUNT. Shareholder agrees
that he, she or it is acquiring the Company Shares for investment purposes only
and not for sale or with a view to distribution of all or any part of such
Company Shares.
2.1.4 RESTRICTED SECURITIES. Shareholder understands that the
Company Shares are "restricted securities" under the Act (as defined below)
because they are being acquired from Company in a transaction not involving a
public offering, and that, under such laws and applicable regulations, such
securities may not be resold for a period of one year from the date of issuance
unless registered with the Securities and Exchange Commission under the Act and
qualified by appropriate state securities regulators, or unless Shareholder
obtains written consent from Company and otherwise complies with an exemption
from such registration and qualification (including, without limitation,
compliance with Rule 144).
2.1.5 LEGEND. Shareholder acknowledges that the certificates
delivered by Company representing the Company Shares shall provide as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE, AND MAY NOT BE OFFERED, SOLD,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF FOR A
PERIOD OF ONE YEAR FROM THE ISSUANCE THEREOF EXCEPT (i) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE STATE
LAWS OR (ii) UPON THE EXPRESS WRITTEN AGREEMENT OF COMPANY AND
COMPLIANCE, TO THE EXTENT APPLICABLE, WITH RULE 144 UNDER THE ACT (OR
ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF
SECURITIES).
2.1.6 ADEQUATE MEANS. Shareholder has adequate means of
providing for current needs and contingencies, has no need for liquidity in the
investment, and is able to bear the economic risk of an investment in the
Company Shares offered by Company of the size contemplated. Each Shareholder
represents that he, she or it is able to bear the economic risk of the
investment and at the present time could afford a complete loss of such
investment.
2.1.7 INDEPENDENT INVESTIGATION. Shareholder acknowledges that,
in entering into this Agreement, Shareholder has relied on Shareholder's own
independent investigations and has not relied upon any representations or other
information (whether oral or written) from Company, or its officers, directors,
agents, employees or representatives.
2.1.8 NO REPRESENTATIONS. Neither the officers, directors, any
agent or employee of Company nor any other person has at any time expressly or
implicitly made any representation, warranty, or guaranty to Shareholder
concerning the Company Shares or Company except as expressly provided herein.
2.2 REPRESENTATIONS AND WARRANTIES OF COMPANY. Company represents and
warrants to each Shareholder, as of the date hereof and as of the Closing, as
follows:
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2.2.1 COMPANY SHARES. The Company Shares to be issued hereunder
shall be duly and validly issued, will be fully paid and nonassessable, and will
be conveyed hereunder free and clear of all liens, security interests,
encumbrances, pledges, restrictions, charges, demands, and claims of any kind
and nature whatsoever, whether direct or indirect or contingent, except for
restrictions on transfer imposed by applicable state and federal securities law.
2.2.2 INDEPENDENT INVESTIGATION. Company acknowledges that, in
entering into this Agreement, Company has relied on Company's own independent
investigations and has not relied upon any representations or other information
(whether oral or written) from any Shareholder, or their respective agents,
employees or representatives.
2.2.3 NO REPRESENTATIONS. Neither the Shareholders nor any of
their respective agents, employees, or representatives nor any other person has
at any time expressly or implicitly made any representation, warranty, or
guaranty to Company concerning the Abraxas Shares or Abraxas except as expressly
provided herein.
ARTICLE 3
CONDITIONS
3.1 CONDITIONS TO EACH PARTY'S OBLIGATIONS. The respective obligations
of each party hereunder shall be subject to the satisfaction prior to or at the
Closing of the following conditions:
(a) NO RESTRAINTS. No statute, rule, regulation, order, decree
or injunction shall have been enacted, entered, promulgated or enforced by any
court or governmental entity of competent jurisdiction which enjoins or
prohibits the consummation of this Agreement and shall be in effect.
(b) LEGAL ACTION. There shall not be pending or threatened in
writing any action, proceeding or other application before any court or
governmental entity challenging or seeking to restrain or prohibit the
consummation of the transactions contemplated by this Agreement, or seeking to
obtain any material damages.
3.2 CONDITIONS TO COMPANY'S OBLIGATIONS. The obligations of the Company
shall be subject to the satisfaction prior to or at the Closing of the following
conditions unless waived by Company:
(a) REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. The
representations and warranties of Shareholders set forth in this Agreement shall
be true and correct as of the date of this Agreement and as of the Closing as
though made on and as of the Closing, except: (i) as otherwise contemplated by
this Agreement, or (ii) in respects that do not have a material adverse effect
on Shareholders or on the benefits of the transactions provided for in this
Agreement.
(b) PERFORMANCE OF OBLIGATIONS OF SHAREHOLDERS. Shareholders
shall have performed all agreements and covenants required to be performed by it
under this Agreement prior to the Closing, except for breaches that do not have
a material adverse effect on Shareholders or on the benefits of the transactions
provided for in this Agreement.
(c) NO MATERIAL CHANGES. Since the date hereof and through
Closing, there shall not have occurred any change, occurrence or circumstance in
the Shareholders having or reasonably likely to have, individually or in the
aggregate, in the reasonable judgment of Company, a material adverse effect on
the transaction contemplated herein.
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(d) DUE DILIGENCE. The Company and Abraxas have and the
opportunity to conduct due diligence and have investigated to their satisfaction
unless as otherwise stated on Schedule C.
3.3 CONDITIONS TO SHAREHOLDER'S OBLIGATIONS. The obligations of
Shareholders shall be subject to the satisfaction prior to or at the Closing of
the following conditions unless waived by Shareholders:
(a) PERFORMANCE OF OBLIGATIONS OF COMPANY. Company shall have
performed all agreements and covenants required to be performed by it under this
Agreement prior to the Closing, except for breaches that do not have a material
adverse effect on Company or on the benefits of the transactions provided for in
this Agreement.
(b) NO MATERIAL CHANGES. Since the date hereof and through
Closing, there shall not have occurred any change, occurrence or circumstance in
Company having or reasonably likely to have, individually or in the aggregate,
in the reasonable judgment of Shareholders, a material adverse effect on
Company.
ARTICLE 4
COVENANTS
4.1 CONFIDENTIALITY. Each party hereto will hold and will cause its
consultants and advisors to hold in strict confidence, unless compelled to
disclose by judicial or administrative process or, in the opinion of its
counsel, by other requirements of law, all documents and information concerning
the other party furnished it by such other party or its representatives in
connection with the transactions contemplated by this Agreement (except to the
extent that such information can be shown to have been (i) previously known by
the party to which it was furnished, (ii) in the public domain through no fault
of such party, or (iii) later lawfully acquired from other sources by the party
to which it was furnished), and each party will not release or disclose such
information to any other person, except its auditors, attorneys, financial
advisors, bankers and other consultants and advisors in connection with this
Agreement.
4.2 FURTHER ASSURANCES. Each party agrees that upon the request of any
other they will, from time to time, without further consideration, execute and
deliver to such other all such instruments and documents of further assurance or
otherwise, and will do any and all such acts and things as may be reasonably
required, to carry out the obligations of such party hereunder and to consummate
the transactions contemplated hereby.
ARTICLE 5
THE CLOSING
5.1 TIME AND PLACE. The consummation of the purchase and sale of shares
contemplated herein (the "Closing") shall take place at Abraxas' headquarters,
on or before January 2,2000, or at such other time and place as the parties
mutually agree upon in writing (which time and place are hereinafter referred to
as the "Closing Date").
5.2 SHAREHOLDERS' DELIVERIES AT CLOSING. On or before the Closing Date,
each Shareholder shall deliver to Company the following:
(a) A certificate or certificates of representing the Abraxas
Shares owned by such Shareholder as set forth in attached Schedule A, together
with a duly executed Stock Power in the form of attached Exhibit "A"; and
(b) Such other documents and instruments reasonably required to
carry out the transactions contemplated herein.
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5.3 COMPANY'S DELIVERIES AT CLOSING. On or before the Closing Date,
Company shall deliver or cause to be delivered to each Shareholder the
following:
(a) A certificate representing the Company Shares pursuant to
Section 1.2 above; and
(b) Such other documents and instruments reasonably required
to carry out the transactions contemplated herein.
ARTICLE 6
DEFAULT, AMENDMENT AND WAIVER
6.1 TERMINATION. Notwithstanding anything to the contrary contained in
this Agreement, this Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing:
6.1.1 By the mutual consent of all of the parties;
6.1.2 By Company at any time in the event of a breach or
default by Shareholders in the observance or in the timely performance of any of
its obligations hereunder which is not waived by Company and which remains
uncured for fifteen (15) days after receipt of notice in writing of such breach
or default;
6.1.3 By Shareholders at any time in the event of a breach or
default by Company in the observance or in the timely performance of any of its
obligations hereunder which is not waived by Shareholders and which remains
uncured for fifteen (15) days after receipt of notice in writing of such breach
or default;
No termination under this section shall be effective unless and until
the terminating party gives written notice of such termination to the other
party. Upon a termination of this Agreement due to a breach or default under
this Agreement by any of the parties (following the cure period provided
herein), the non-defaulting party shall have all rights and remedies given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.
6.2 WAIVER AND AMENDMENT. Any term, provision, covenant,
representation, warranty or condition of this Agreement may be waived, but only
by a written instrument signed by the party entitled to the benefits thereof.
The failure or delay of any party at any time or times to require performance of
any provision hereof or to exercise its rights with respect to any provision
hereof shall in no manner operate as a waiver of or affect such party's right at
a later time to enforce the same. No waiver by any party of any condition, or of
the breach of any term, provision, covenant, representation or warranty
contained in this Agreement, in any one or more instances, shall be deemed to be
or construed as a further or continuing waiver of any such condition or breach
or waiver of any other condition or of the breach of any other term, provision,
covenant, representation or warranty. No modification or amendment of this
Agreement shall be valid and binding unless it be in writing and signed by all
parties hereto.
ARTICLE 7
MISCELLANEOUS
7.1 DESTRUCTION OF PROPERTY. If any property being sold hereunder shall
be substantially damaged or destroyed by fire or other cause prior to the time
of Closing, Shareholders shall immediately notify Company and furnish to Company
a written statement of the amount of insurance, if any, payable on account
thereof. In the event of such damage or destruction, Company may elect (i) to
require that Shareholders restore the property to its condition on the date of
this Agreement or (ii) to declare this Agreement null and void.
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7.2 NOTICES. Any notice, request, instruction or other document
required by the terms of this Agreement, or deemed by any of the parties hereto
to be desirable, to be given to any other party hereto shall be in writing and
shall be given by prepaid telegram or delivered or mailed by registered or
certified mail, postage prepaid, with return receipt requested, to the following
addresses:
To Company:
NetSol International, Inc.
0000 X. Xxxx Xxxxxxxxx, Xxxxx # 000
Xxxxxxxxx, XX 00000
Phone: 000-000-0000
Fax: 000-000-0000
Attn: Xx. Xxxxxx Xxxxxx, President
To Shareholders:
c/o Abraxas Software Pty Ltd.
Attn.: Xxxx Xxxxx
The persons and addresses set forth above may be changed from time to time by a
notice sent as aforesaid. If notice is given by delivery in accordance with the
provisions of this Section, said notice shall be conclusively deemed given at
the time of such delivery. If notice is given by mail in accordance with the
provisions of this Section, such notice shall be conclusively deemed given
forty-eight (48) hours after deposit thereof in the United States mail. If
notice is given by telegraph in accordance with the provisions of this Section,
such notice shall be conclusively deemed given at the time that the telegraphic
agency shall confirm delivery thereof to the addressee.
7.3 ENTIRE AGREEMENT. This Agreement, together with the schedules and
exhibits hereto, sets forth the entire agreement and understanding of the
parties hereto with respect to the transactions contemplated hereby, and
supersedes all prior agreements, arrangements and understandings related to the
subject matter hereof.
7.4 SURVIVAL OF REPRESENTATIONS. All representation, warranties
agreements and covenants hereunder shall survive the Closing and remain
effective. Consummation of the transactions contemplated hereby shall not be
deemed or construed to be a waiver of any right or remedy possessed by any party
hereto, notwithstanding that such party knew or should have known at the time of
Closing that such right or remedy existed.
7.5 INCORPORATED BY REFERENCE. The schedules, exhibits and all
documents delivered as part hereof or incident hereto are incorporated as a part
of this Agreement by reference.
7.6 SEVERABILITY. If any provision hereof is held to be illegal,
invalid or unenforceable under present or future laws effective during the term
hereof, such provision shall be fully severable.
7.7 GOVERNING LAW. This Agreement has been negotiated and executed in
the State of California and shall be construed and enforced in accordance with
the laws of such state.
7.8 ARBITRATION. If a dispute or claim shall arise with respect to any
of the terms or provisions of this Agreement, then either party may, by notice
as herein provided, require that the dispute be submitted under the Commercial
Arbitration Rules of the American Arbitration Association to an arbitrator in
good standing with the American Arbitration Association within fifteen (15) days
after such notice is given. Any such arbitrator so selected is to be mutually
acceptable to both parties. If both parties are unable to agree upon a
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single arbitrator, each party shall appoint one (1) arbitrator. If either party
does not appoint an arbitrator within five (5) days after the other party has
given notice of the name of its arbitrator, the single arbitrator appointed by
the party giving notice shall be the sole arbitrator and such arbitrator's
decision shall be binding upon both parties. If two (2) arbitrators are
appointed, these two (2) arbitrators shall appoint a third arbitrator who shall
proceed to resolve the question. The written decision of the single arbitrator
ultimately appointed by or for both parties shall be binding and conclusive on
the parties. Judgment may be entered on such written decision by the single
arbitrator in any court having jurisdiction and the parties consent to the
jurisdiction of the Municipal and Superior Court of Orange County, California
for this purpose. Any arbitration undertaken pursuant to the terms of this
section shall occur in Orange County, California.
7.9 ATTORNEYS' FEES. In the event of any legal, equitable or
administrative action or proceeding brought by any party against another party
under this Agreement, the prevailing party shall be entitled to recover the
reasonable fees of its attorneys and any costs incurred in such action or
proceeding including costs of appeal, if any, in such amount that the court or
administrative body having jurisdiction over such action may award.
7.10 BINDING EFFECT AND ASSIGNMENT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
executors, administrators, legal representatives and assigns; provided, however,
that neither party may assign any of its rights under this Agreement without the
prior written consent of the other party, which consent may be withheld in such
party's sole discretion.
7.11 COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. In making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the day and year first above written.
SHAREHOLDERS: (Percent of Shares Owned) COMPANY:
NETSOL INTERNATIONAL INC.,
a Nevada corporation
/s/ Xxxx Xxxxx (44%) /s/ Xxxxx Xxxxxx
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XXXX XXXXX By: Xxxxx Xxxxxx
/s/ Xxxx Xxxxxxx (12%) Its: CEO
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XXXX XXXXXXX
/s/ Xxx Xxxxxxxx (44%)
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XXX XXXXXXXX
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