STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT is made and entered into as of September __,
1999, by and between VENTURI TECHNOLOGIES, INC., a Nevada corporation ("Buyer"),
and XXXXXXX X. XXXXXXX ("Seller").
RECITALS
A. Seller owns all of the issued and outstanding capital stock (the
"Shares") of J.L.L.C., Inc., a Utah corporation transacting business under the
name Xxxxxxx Restoration Services (the "Company").
B. Seller desires to sell, and Buyer desires to purchase, all of the Shares
for the consideration and on the terms set forth in this Agreement.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. SALE AND TRANSFER OF SHARES; CLOSING
1.1 PURCHASE AND SALE OF SHARES. Subject to the terms and conditions of
this Agreement, at the Closing, Seller will sell and transfer the Shares to
Buyer, and Buyer will purchase the Shares from Seller. Buyer acknowledges and
agrees that at or prior to the Closing, the Company shall transfer to the
Seller, a 1997 Toyota truck (VIN No. ________________), together with all debts,
obligations and liabilities related to such truck.
1.2 PURCHASE PRICE.
1.2.1 VENTURI SHARES. As consideration for the Shares of the Company,
Buyer shall issue to Seller twenty five thousand (25,000) shares of Buyer's
authorized but unissued $0.001 par value common stock (the "Venturi Shares").
1.2.2 RESTRICTED STOCK. The Shares issued to Seller under this
Agreement have not been registered with the Securities and Exchange Commission,
nor have the Shares been qualified under the securities laws of any state. The
Seller acknowledges that the Shares are subject to the following restriction
which will be printed in the following form on the certificates representing the
Shares:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR QUALIFIED UNDER
THE SECURITIES LAWS OF ANY STATE (THE "LAW"). SUCH SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND NEITHER SAID SHARES NOR ANY INTEREST THEREIN
MAY BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SHARES UNDER THE ACT AND QUALIFICATION UNDER THE LAW OR
AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH
REGISTRATION AND QUALIFICATION ARE NOT REQUIRED AS TO SAID SALE OR OFFER.
Seller represents the following to Purchaser in order to establish exemptions
from registration under Federal and state securities laws. Seller is acquiring
the Shares for his own account, for investment, and not for resale in connection
with any distribution thereof. Seller has such knowledge and experience in
business and financial matters that he is capable of evaluating the risks of
obtaining the Shares. Seller understands the speculative nature of the Shares.
Seller has adequate net worth and means to provide for his current needs and to
sustain a complete loss of his investment. Seller has no need of liquidity of
his investment. Seller understands that at present no public market exists, and
that a public market may never exist, for the Shares and that the Purchaser is
under no obligation to provide a market for the Shares.
1.2.3 RESTRICTION ON RESALE. Except as provided below, Seller shall
not, without the prior written consent of the Purchaser, offer for sale, sell,
pledge, hypothecate or otherwise dispose of, directly or indirectly, any of the
Shares, in any manner whatsoever, whether pursuant to SEC Rule 144 or otherwise,
prior to the date that is two (2) years after the Closing Date; provided
however, that a certain number of Shares shall be released from this restriction
on the following schedule:
5% of the total initial amount of the Shares shall be released
each month during the thirteenth (13th) through sixteenth (16th)
month after the Closing Date;
8% of the total initial amount of the Shares shall be released
each month during the seventeenth (17th) through twenty-first
(21st) month after the Closing Date; and
10% of the total initial amount of the Shares shall be released
each month during the twenty-second (22nd) through twenty-third
(23rd) month after the Closing Date.
The certificates representing the Shares may contain, for so long as this
restriction remains in effect, a legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER, INCLUDING AN AGREEMENT BETWEEN THE COMPANY AND
THE ORIGINAL HOLDER OF THE SHARES REPRESENTED BY THIS CERTIFICATE THAT THE
SHARES MAY NOT BE OFFERED OR SOLD FOR A
CERTAIN PERIOD OF TIME AFTER THE DATE OF ISSUANCE.
1.2.4 CONSENT TO DILUTION. Seller understands that Purchaser plans to
acquire other businesses and assets by issuing stock, and that Purchaser may
issue shares of its stock for other reasons in the future. Seller understands
and consents that future issuances of stock will dilute Seller's proportionate
ownership of Purchaser.
1.2.5 EMPLOYMENT OF OWNERS. As partial consideration for the Shares, at
the Closing the Purchaser shall enter an employment agreement with Xxxxxxx X.
Xxxxxxx, which employment agreement shall be in a form acceptable to the Seller
and the Purchaser.
1.3 CLOSING. The purchase and sale of the Shares (the "Closing") provided
for in this Agreement will take place at the offices of Venturi at 000 Xxxxx 000
Xxxx, Xxxx, Xxxx 00000, at 10:00 a.m. (local time) on September 30, 1999, or
such other place, time and date agreed to by the Parties.
1.4 CLOSING DELIVERIES.
1.4.1 SELLER'S DOCUMENTS. At the Closing, Seller will deliver to
Buyer:
(a) certificates representing the Shares, duly endorsed (or
accompanied by duly executed stock powers); and
(b) employment agreement in the form of Exhibit ___, executed by
Seller (the "Employment Agreement").
1.4.2 BUYER'S DOCUMENTS. At the Closing, Buyer will deliver to Seller:
(a) a certificate representing twenty five thousand (25,000) shares of
Buyer's $0.001 par value common stock; and
(b) the Employment Agreement, executed by Buyer.
2. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows:
2.1 ORGANIZATION AND GOOD STANDING. (a) The Company is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Utah, with full corporate power and authority to conduct its business as it is
now being conducted, to own or use the properties and assets that it purports to
own or use, and to perform all its obligations under applicable contracts. The
Company is duly qualified to do business as a foreign corporation and is in good
standing under the laws of each state or other jurisdiction in which either the
ownership or use of the properties owned or used by it, or the nature of the
activities conducted by it, requires such qualification.
2.2 AUTHORITY. This Agreement constitutes the legal, valid, and binding
obligation of Seller, enforceable against Seller in accordance with its terms.
Upon the execution and delivery by Seller of this Agreement and the Employment
Agreement (collectively, the "Seller's Closing Documents"), the Seller's Closing
Documents will constitute the legal, valid, and binding obligations of Seller,
enforceable against Seller in accordance with their respective terms. Seller has
the absolute and unrestricted right, power, authority, and capacity to execute
and deliver the Seller's Closing Documents and to perform their obligations
under the Seller's Closing Documents.
2.3 NO CONFLICT. Neither the execution and delivery of this Agreement nor
the consummation or performance of any of the contemplated transactions by
Seller will violate or constitute a default under any mortgage, indenture, deed
of trust, lease, contract, agreement, license or other instrument or any order,
judgement or ruling of any governmental authority to which the Seller is
subject, or to the best knowledge of Seller, any of the property of the Company
is bound, or result in the creation of any mortgage, pledge, lien, charge or
encumbrance upon any of the assets of the Company or the loss of any license or
other contractual right with respect thereto, except in each case for any of the
foregoing which is not, individually or in the aggregate, material to the
Company.
Except as may be set forth in Schedule 2.3, neither the Seller nor the
Company is or will be required to give any notice to or obtain any consent from
any person in connection with the execution and delivery of this Agreement or
the consummation or performance of the transaction contemplated hereby.
Seller is acquiring the Shares for his own account and not with a view to
their distribution within the meaning of Section 2(11) of the Securities Act.
Seller is an "accredited investor" as such term is defined in Rule 501(a) under
the Securities Act of 1933, as amended, (the "Securities Act") and the rules and
regulations promulgated thereunder.
2.4 CAPITALIZATION. The authorized capital stock of the Company consists of
50,000 shares of common stock, no par value per share, of which 10,000 shares
are issued and outstanding and constitute the Shares. The Company never issued
stock certificates, and the Shares are consequently not evidenced by
certificates. Seller is and will be on the Closing Date the record and
beneficial owner and holder of all of the Shares, free and clear of all
Encumbrances. No legend or other reference to any purported Encumbrance appears
upon any certificate representing equity securities of the Company. All of the
outstanding equity securities of the Company have been duly authorized and
validly issued and are fully paid and nonassessable. There are no Contracts
relating to the issuance, sale, or transfer of any equity securities or other
securities of the Company. None of the outstanding equity securities or other
securities of the Company was issued in violation of the Securities Act or any
state law regulating the sale and issuance of securities. The Company does not
own, nor does it have any Contract to acquire, any equity securities or other
securities of any other business or any direct or indirect equity or ownership
interest in any other business.
2.5 FINANCIAL STATEMENTS. Seller have delivered to Buyer unaudited balance
sheets of the Company as of June 30 in each of the years 1996, 1997 and 1998
(the "Balance Sheet"), and the related unaudited statements of income for each
of the fiscal years then ended. Such financial statements and notes fairly
present the financial condition and the results of operations, changes in
stockholders' equity, and cash flow of the Company as at the respective dates of
and for the periods referred to in such financial statements, all in accordance
with GAAP, subject, in the case of interim financial statements, to normal
recurring year-end adjustments (the effect of which will not, individually or in
the aggregate, be materially adverse) and the absence of notes (that, if
presented, would not differ materially from those included in the balance
sheet); the financial statements referred to in this Section reflect the
consistent application of such accounting principles throughout the periods
involved, except as disclosed in the notes to such financial statements. No
financial statements of any person or entity other than the Company are required
by GAAP to be included in the consolidated financial statements of the Company.
2.6 BOOKS AND RECORDS. The books of account, minute books, stock record
books, and other records of the Company, all of which have been made available
to Buyer, are complete and correct and have been maintained in accordance with
sound business practices. The minute books of the Company contain accurate and
complete records of all meetings held of, and corporate action taken by, the
stockholders, the Boards of Directors, and committees of the Boards of Directors
of the Company. At the Closing, all of those books and records will be in the
possession of the Company.
2.7 TITLE TO PROPERTIES; ENCUMBRANCES. Seller has delivered to Buyer a
complete and accurate list of all real and personal property interests owned by
the Company. The Company owns all the properties and assets that have been
disclosed to Buyer. All material properties disclosed as being owned by the
Company are owned free and clear of all liens and encumbrances except as
previously disclosed in writing to Buyer.
2.8 CONDITION AND SUFFICIENCY OF ASSETS. To the best of Seller's knowledge,
except as set forth in Schedule 2.8, the Company's property and assets are in
good operating condition and repair, and are adequate for the uses to which they
are being put, and none of such property and assets are in need of maintenance
or repairs except for ordinary, routine maintenance and repairs that are not
material in nature or cost. The property and assets of the Company are
sufficient for the continued conduct of the Company's business after the Closing
in substantially the same manner as conducted prior to the Closing.
2.9 ACCOUNTS RECEIVABLE. All accounts receivable of the Company that are
reflected in the accounting records of The Company as of the Closing Date
(collectively, the "Accounts Receivable") represent valid obligations arising
from sales actually made or services actually performed in the ordinary course
of business. To the best of Seller's knowledge, unless paid prior to the Closing
Date, the Accounts Receivable are or will be as of the Closing Date current and
collectible. Absent any unforeseen events, each of the Accounts Receivable
historically has been collected in full within ninety days after the day on
which it first becomes
due and payable. Except as may be set forth on Schedule 2.10 referred to below,
there is not any pending, or to Seller's knowledge threatened, contest or claim
challenging the validity of any of the Accounts Receivable.
2.10 NO UNDISCLOSED LIABILITIES. Except as may be set forth in Schedule
2.10, the Company has no liabilities or obligations of any nature (whether known
or unknown and whether absolute, accrued, contingent, or otherwise) except for
liabilities or obligations reflected or reserved against in the Balance Sheet
and current liabilities incurred in the ordinary course of business.
2.11 TAXES. To the best of Seller's knowledge the Company has filed or
caused to be filed within the past five (5) years all tax returns that are or
were required to be filed by or with respect to the Company, pursuant to
applicable laws and regulations. Seller has delivered or made available to Buyer
copies of all such tax returns filed since 1997. To the best of Seller's
knowledge, all tax returns filed by the Company are true, correct, and complete.
2.12 NO MATERIAL ADVERSE CHANGE. To the best of Seller's knowledge, since
the date of the Balance Sheet, there has not been any material adverse change in
the business, operations, properties, prospects, assets, or condition of the
Company, and no event has occurred or circumstance exists that may result in
such a material adverse change.
2.13 CONTRACTS AND EMPLOYEE BENEFITS. Except as may be set forth in
Schedule 2.13, the Company is not a party to any contract or agreement that
involves annual payments by the Company in excess of $25,000, other than in the
ordinary course of business. The consummation of the transaction contemplated
herein will not result in the termination of any material agreement or contract
to which the Company is a party, nor give any party thereto the right to cancel
or terminate any such contract or agreement.
2.14 ERISA. The Company has never offered to its employees any pension,
profit sharing, 401k plan or other employee benefit plan as defined in the
Employee Retirement Income Security Act of 1974 ("ERISA").
2.15 COMPLIANCE WITH LEGAL REQUIREMENTS. Except as may be set forth on
Schedule 2.15, the Company has not received any notice of any violation of any
laws or regulations that are or were applicable to it or to the conduct or
operation of its business or the ownership or use of any of its assets, which
violation has not been cured as of the Closing Date, and to the best knowledge
of Seller, the Company is in full compliance with all such laws or regulations.
2.16 GOVERNMENTAL AUTHORIZATIONS. The Company has obtained all governmental
authorizations and permits that are necessary to permit the Company to lawfully
conduct and operate its business in the manner currently conducted.
2.17 LEGAL PROCEEDINGS. Except as disclosed in Schedule 2.17, there is no
material lawsuit or legal or administrative or regulatory proceeding or
investigation pending against the Company or, to the best knowledge of Seller,
threatened against the Company.
2.18 ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as may be set forth in
Schedule 2.18, since the date of the Balance Sheet, the Company has conducted
its business only in the ordinary course of business and there has not been any:
(a) change in the Company's authorized or issued capital stock; grant
of any stock option or right to purchase shares of capital stock of
the Company; issuance of any security convertible into such capital
stock; grant of any registration rights; purchase, redemption,
retirement, or other acquisition by the Company of any shares of any
such capital stock; or declaration or payment of any dividend or other
distribution or payment in respect of shares of capital stock;
(b) amendment to the organizational documents of the Company;
(c) payment or increase by the Company of any extraordinary bonuses,
salaries, or other compensation to any stockholder, director, officer,
or (except in the ordinary course of business) employee or entry into
any employment, severance, or similar contract with any director,
officer, or employee;
(d) adoption of, or increase in the payments to or benefits under, any
profit sharing, bonus, deferred compensation, savings, insurance,
pension, retirement, or other employee benefit plan for or with any
employees of the Company;
(e) material damage to or destruction or loss of any asset or property
of the Company, whether or not covered by insurance, materially and
adversely affecting the properties, assets, business, financial
condition, or prospects of the Company, taken as a whole;
(f) entry into, termination of, or receipt of notice of termination of
(i) any license, distributorship, dealer, sales representative, joint
venture, credit, or similar agreement, or (ii) any contract or
transaction involving a total remaining commitment by or to the
Company of at least $25,000;
(g) sale (other than sales of inventory in the ordinary course of
business), lease, or other disposition of any asset or property of the
Company or mortgage, pledge, or imposition of any lien or other
encumbrance on any material asset or property of the Company;
(h) cancellation or waiver of any claims or rights with a value to the
Company in excess of $25,000; or
(i) material change in the accounting methods used by the Company.
2.19 INSURANCE. The Company maintains policies of insurance in such
amounts, with such deductibles and against such risks and losses as are, in its
judgment, reasonable for the business and assets of the Company, and Seller will
deliver to Buyer on the Closing Date
certificates of insurance setting forth the name of the insurance company,
policy number and type of coverage of all insurance policies maintained as of
the date hereof with respect to the Company's business operations, property,
plant and equipment.
2.20 ENVIRONMENTAL MATTERS. There are no pending or, to the knowledge of
Seller and the Company, threatened claims, encumbrances, or other restrictions
of any nature, resulting from any environmental, health, and safety liabilities
or arising under or pursuant to any environmental law, with respect to or
affecting any of the operations, properties and assets (whether real, personal,
or mixed) in which Seller or the Company has or had an interest.
2.21 DISCLOSURE. No representation or warranty of Seller in this Agreement
and no statement in the Schedules attached to this Agreement omits to state a
material fact necessary to make the statements herein or therein, in light of
the circumstances in which they were made, not misleading. There is no fact
known to either Seller that has specific application to either Seller or the
Company (other than general economic or industry conditions) and that materially
adversely affects or, as far as either Seller can reasonably foresee, materially
threatens, the assets, business, prospects, financial condition, or results of
operations of the Company (on a consolidated basis) that has not been set forth
in this Agreement or the Schedules attached hereto.
2.22 BROKERS OR FINDERS. Seller has incurred no obligation or liability,
contingent or otherwise, for brokerage or finders' fees or agents' commissions
or other similar payment in connection with this Agreement.
3. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
3.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada.
3.2 AUTHORITY; NO CONFLICT. This Agreement constitutes the legal, valid,
and binding obligation of Buyer, enforceable against Buyer in accordance with
its terms. Upon the execution and delivery by Buyer of this Agreement and the
Employment Agreement (collectively, the "Buyer's Closing Documents"), the
Buyer's Closing Documents will constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms. Buyer has the absolute and unrestricted right, power, and
authority to execute and deliver the Buyer's Closing Documents and to perform
its obligations under the Buyer's Closing Documents. Except as set forth in
Schedule 3.2, neither the execution and delivery of this Agreement nor the
consummation or performance of any of the transactions contemplated hereby will
give any person the right to prevent, delay, or otherwise interfere with any of
the transactions contemplated hereby pursuant to:
(i) any provision of Buyer's Organizational Documents;
(ii) any resolution adopted by the board of directors or the
shareholders of
Buyer;
(iii) any legal requirement or order to which Buyer may be subject; or
(iv) any contract to which Buyer is a party or by which Buyer may be
bound.
Except as set forth in Schedule 3.2, Buyer is not and will not be required
to obtain any consent from any person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
transactions contemplated hereby.
3.3 INVESTMENT INTENT. Buyer is acquiring the Shares for its own account
and not with a view to their distribution within the meaning of Section 2(11) of
the Securities Act.
3.4 CERTAIN PROCEEDINGS. There is no pending legal proceeding that has been
commenced against Buyer and that challenges, or may have the effect of
preventing, delaying, making illegal, or otherwise interfering with, any of the
transactions contemplated hereby. To Buyer's knowledge, there exist no grounds
for such proceeding, nor has any such proceeding been threatened.
3.5 BROKERS OR FINDERS. Buyer and its officers and agents have incurred no
obligation or liability, contingent or otherwise, for brokerage or finders' fees
or agents' commissions or other similar payment in connection with this
Agreement and will indemnify and hold Seller harmless from any such payment
alleged to be due by or through Buyer as a result of the action of Buyer or its
officers or agents.
4. COVENANTS OF SELLER PRIOR TO CLOSING DATE
4.1 ACCESS AND INVESTIGATION. Between the date of this Agreement and the
Closing Date, Seller will, and will cause the Company and its representatives
to, (a) afford Buyer and its representatives and prospective lenders and their
representatives (collectively, "Buyer's Advisors") full and free access to the
Company's personnel, properties, contracts, books and records, and other
documents and data, (b) furnish Buyer and Buyer's Advisors with copies of all
such contracts, books and records, and other existing documents and data as
Buyer may reasonably request, and (c) furnish Buyer and Buyer's Advisors with
such additional financial, operating, and other data and information as Buyer
may reasonably request.
4.2 OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES. Between the date
of this Agreement and the Closing Date, Seller will, and will cause the Company
to:
(a) conduct the business of the Company only in the ordinary course of
business;
(b) use best efforts to preserve intact the current business organization
of the Company, keep available the services of the current officers,
employees, and agents of the Company, and maintain the relations and good
will with suppliers, customers, landlords, creditors, employees, agents,
and others having business relationships with the Company;
(c) confer with Buyer concerning operational matters of a material nature;
and
(d) otherwise report periodically to Buyer concerning the status of the
business, operations, and finances of the Company.
4.3 NEGATIVE COVENANT. Except as otherwise expressly permitted by this
Agreement, between the date of this Agreement and the Closing Date, Seller will
not, and will cause the Company not to, without the prior consent of Buyer, take
any affirmative action, or fail to take any reasonable action within their or
its control, as a result of which any material change in the business of the
Company is likely to occur.
4.4 REQUIRED APPROVALS. As promptly as practicable after the date of this
Agreement, Seller will, and will cause the Company to, make all reports and
filings required by applicable laws and regulations to be made by them in order
to consummate the transactions contemplated hereby. Between the date of this
Agreement and the Closing Date, Seller will, and will cause the Company to, (a)
cooperate with Buyer with respect to all filings that Buyer elects to make or is
required by applicable laws and regulations to make in connection with the
transactions contemplated hereby, and (b) cooperate with Buyer in obtaining all
consents necessary or appropriate to consummate the transactions contemplated
hereby.
4.5 NOTIFICATION. Between the date of this Agreement and the Closing Date,
the Seller will promptly notify Buyer in writing if the Seller or the Company
becomes aware of any fact or condition that causes or constitutes a Breach of
any of Seller's representations and warranties as of the date of this Agreement,
or if the Seller or the Company becomes aware of the occurrence after the date
of this Agreement of any fact or condition that would (except as expressly
contemplated by this Agreement) cause or constitute a Breach of any such
representation or warranty had such representation or warranty been made as of
the time of occurrence or discovery of such fact or condition. Should any such
fact or condition require any change in this Agreement or the Schedules attached
to this Agreement, Seller will promptly deliver to Buyer a supplement to this
Agreement or the Schedules attached hereto specifying such change. During the
same period, each Seller will promptly notify Buyer of the occurrence of any
Breach of any covenant of Seller in this Section or of the occurrence of any
event that may make the satisfaction of the conditions to closing set forth in
this Agreement impossible or unlikely.
4.6 PAYMENT OF INDEBTEDNESS BY RELATED PERSONS. Except as expressly
provided in this Agreement, Seller will cause all indebtedness owed to the
Company by either Seller or any related person of either Seller to be paid in
full prior to Closing.
4.7 NO NEGOTIATION. Until such time, if any, as this Agreement is
terminated, Seller will not, and will cause the Company and each of their
representatives not to, directly or indirectly solicit, initiate, or encourage
any inquiries or proposals from, discuss or negotiate with, provide any
non-public information to, or consider the merits of any unsolicited inquiries
or proposals from, any person (other than Buyer) relating to any transaction
involving the sale
of the business or assets (other than in the ordinary course of business) of the
Company, or any of the capital stock of the Company, or any merger,
consolidation, business combination, or similar transaction involving the
Company.
4.8 BEST EFFORTS. Between the date of this Agreement and the Closing Date,
Seller will use his best efforts to cause the conditions to closing set forth in
this Agreement to be satisfied.
5. COVENANTS OF BUYER PRIOR TO CLOSING DATE
5.1 APPROVALS OF GOVERNMENTAL AUTHORITIES. As promptly as practicable after
the date of this Agreement, Buyer will make all filings and obtain all consents
required by applicable laws and regulations in order to consummate the
transactions contemplated hereby.
5.2 BEST EFFORTS. Between the date of this Agreement and the Closing Date,
Buyer will use its best efforts to cause the conditions in Sections 6 and 7 to
be satisfied.
6. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Shares and to take the other actions
required to be taken by Buyer at the Closing is subject to the satisfaction, at
or prior to the Closing, of each of the following conditions (any of which may
be waived by Buyer, in whole or in part):
6.1 ACCURACY OF REPRESENTATIONS. All of Seller's representations and
warranties in this Agreement (considered collectively), and each of these
representations and warranties (considered individually), must have been
accurate in all material respects as of the date of this Agreement, and must be
accurate in all material respects as of the Closing Date as if made on the
Closing Date.
6.2 SELLER'S PERFORMANCE. All of the covenants and obligations that Seller
is required to perform or to comply with pursuant to this Agreement at or prior
to the Closing (considered collectively), and each of these covenants and
obligations (considered individually), must have been duly performed and
complied with in all material respects. Seller must have delivered each of the
documents required to be delivered by Seller pursuant to this Agreement.
6.3 CONSENTS. Each of the consents required to consummate the transactions
contemplated hereby must have been obtained and must be in full force and
effect.
6.4 NO PROCEEDINGS. Since the date of this Agreement, there must not have
been commenced or threatened against Buyer, or against any person affiliated
with Buyer, any proceeding (a) involving any challenge to, or seeking damages or
other relief in connection with, any of the transactions contemplated hereby, or
(b) that may have the effect of preventing, delaying, making illegal, or
otherwise interfering with any of the transactions contemplated hereby.
6.5 NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS. There must not
have
been made or threatened by any person any claim asserting that such person (a)
is the holder or the beneficial owner of, or has the right to acquire or to
obtain beneficial ownership of, any stock of, or any other voting, equity, or
ownership interest in the Company, or (b) is entitled to all or any portion of
the purchase price payable for the Shares.
6.6 NO PROHIBITION. Neither the consummation nor the performance of any of
the transactions contemplated hereby will, directly or indirectly (with or
without notice or lapse of time), materially contravene, or conflict with, or
result in a material violation of, or cause Buyer or any person affiliated with
Buyer to suffer any material adverse consequence under, any applicable laws or
regulations.
7. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE
Seller's obligation to sell the Shares and to take the other actions
required to be taken by Seller at the Closing is subject to the satisfaction, at
or prior to the Closing, of each of the following conditions (any of which may
be waived by Seller, in whole or in part):
7.1 ACCURACY OF REPRESENTATIONS. All of Buyer's representations and
warranties in this Agreement (considered collectively), and each of these
representations and warranties (considered individually), must have been
accurate in all material respects as of the date of this Agreement and must be
accurate in all material respects as of the Closing Date as if made on the
Closing Date.
7.2 BUYER'S PERFORMANCE. All of the covenants and obligations that Buyer is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing (considered collectively), and each of these covenants and
obligations (considered individually), must have been performed and complied
with in all material respects. Buyer must have delivered each of the documents
required to be delivered by Buyer pursuant to Section 1.4.2 and must have made
the cash payments required to be made by Buyer pursuant to Section 1.4.2.
7.3 CONSENTS. All of the consents required to be obtained from Buyer must
have been obtained and must be in full force and effect.
7.4 NO PROHIBITION. Neither the consummation nor the performance of any of
the transactions contemplated hereby will, directly or indirectly (with or
without notice or lapse of time), materially contravene, or conflict with, or
result in a material violation of, or cause Seller or any person affiliated with
Seller to suffer any material adverse consequence under, any applicable laws or
regulations.
8. TERMINATION
8.1 TERMINATION EVENTS. This Agreement may, by notice given prior to or at
the Closing, be terminated:
(a) by either Buyer or Seller if a material breach of any provision of this
Agreement
has been committed by the other party and such breach has not been waived;
(b) (i) by Buyer if any of the conditions in Section 6 has not been
satisfied as of the Closing Date or if satisfaction of such a condition is
or becomes impossible (other than through the failure of Buyer to comply
with its obligations under this Agreement) and Buyer has not waived such
condition on or before the Closing Date; or (ii) by Seller, if any of the
conditions in Section 7 has not been satisfied as of the Closing Date or if
satisfaction of such a condition is or becomes impossible (other than
through the failure of Seller to comply with their obligations under this
Agreement) and Seller has not waived such condition on or before the
Closing Date; or
(c) by mutual consent of Buyer and Seller.
8.2 EFFECT OF TERMINATION. Each party's right of termination under Section
8.1 is in addition to any other rights it may have under this Agreement or
otherwise, and the exercise of a right of termination will not be an election of
remedies. If this Agreement is terminated pursuant to Section 8.1, all further
obligations of the parties under this Agreement will terminate, except that the
obligations in Sections 10.1 and 10.2 will survive; provided, however, that if
this Agreement is terminated by a party because of the breach of the Agreement
by the other party or because one or more of the conditions to the terminating
party's obligations under this Agreement is not satisfied as a result of the
other party's failure to comply with its obligations under this Agreement, the
terminating party's right to pursue all legal remedies will survive such
termination unimpaired.
9. INDEMNIFICATION; REMEDIES
9.1 SURVIVAL; RIGHT TO INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE. All
representations, warranties, covenants, and obligations in this Agreement and
the Schedules attached hereto, will survive the Closing. The right to
indemnification, payment of damages or other remedy based on such
representations, warranties, covenants, and obligations will not be affected by
any investigation conducted with respect to, or any knowledge acquired (or
capable of being acquired) at any time, whether before or after the execution
and delivery of this Agreement or the Closing Date, with respect to the accuracy
or inaccuracy of or compliance with, any such representation, warranty,
covenant, or obligation. The waiver of any condition based on the accuracy of
any representation or warranty, or on the performance of or compliance with any
covenant or obligation, will not affect the right to indemnification, payment of
damages, or other remedy based on such representations, warranties, covenants,
and obligations.
9.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER. Seller will indemnify
and hold harmless Buyer, the Company, and their respective representatives,
stockholders, controlling persons, and affiliates (collectively, the
"Indemnified Persons") for, and will pay to the Indemnified Persons the amount
of, any loss, liability, claim, damage (including incidental and consequential
damages), expense (including costs of investigation and defense and reasonable
attorneys' fees) or diminution of value, whether or not involving a third-party
claim
(collectively, "Damages"), arising, directly or indirectly, from or in
connection with:
(a) any and all loss, liability or damage suffered or incurred by Buyer in
respect of any debt, obligation or liability of the Company or of Seller
not disclosed in this Agreement, any of the Schedules attached hereto, or
in writing to Buyer prior to the Closing Date;
(b) any breach of any representation or warranty made by Seller in this
Agreement, the Schedules attached hereto, or any other certificate or
document delivered by Seller pursuant to this Agreement;
(c) any breach of any representation or warranty made by Seller in this
Agreement as if such representation or warranty were made on and as of the
Closing Date;
(d) any Breach by Seller of any covenant or obligation of Seller in this
Agreement;
(e) any claim by any Person for brokerage or finder's fees or commissions
or similar payments based upon any agreement or understanding alleged to
have been made by any such Person with either Seller or the Company (or any
person acting on their behalf) in connection with any of the transactions
contemplated hereby.
The remedies provided in this Section 9.2 will not be exclusive of or limit
any other remedies that may be available to Buyer or the other Indemnified
Persons.
9.3 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will indemnify
and hold harmless Seller, and will pay to Seller the amount of any damages
arising, directly or indirectly, from or in connection with (a) any breach of
any representation or warranty made by Buyer in this Agreement or in any
certificate delivered by Buyer pursuant to this Agreement, (b) any breach by
Buyer of any covenant or obligation of Buyer in this Agreement, or (c) any claim
by any person 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 with Buyer (or any person acting on its behalf) in connection with any of
the transactions contemplated hereby.
10. GENERAL PROVISIONS
10.1 EXPENSES. Except as otherwise expressly provided in this Agreement,
each party to this Agreement will bear its respective expenses incurred in
connection with the preparation, execution, and performance of this Agreement
and the transactions contemplated hereby, including all fees and expenses of
agents, representatives, counsel, and accountants. In the event of termination
of this Agreement, the obligation of each party to pay its own expenses will be
subject to any rights of such party arising from a breach of this Agreement by
another party.
10.2 CONFIDENTIALITY. Between the date of this Agreement and the Closing
Date, Buyer and Seller will maintain in confidence, and will cause the
directors, officers, employees, agents, and advisors of Buyer and the Company to
maintain in confidence, any written, oral, or other information obtained in
confidence from another party or the Company in connection with this Agreement
or the transactions contemplated hereby, unless (a) such information is already
known to such party or to others not bound by a duty of confidentiality or such
information becomes publicly available through no fault of such party, (b) the
use of such information is necessary or appropriate in making any filing or
obtaining any consent or approval required for the consummation of the
transactions contemplated hereby, or (c) the furnishing or use of such
information is required by or necessary or appropriate in connection with legal
proceedings. If the transactions contemplated hereby are not consummated, each
party will return or destroy as much of such written information as the other
party may reasonably request.
10.3 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by telecopier (with written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and telecopier
numbers set forth below (or to such other addresses and telecopier numbers as a
party may designate by notice to the other parties):
Seller: Xxxxxxx X. Xxxxxxx
0000 Xxxxxxxxx Xxx
Xxxxx Xxxxxx, Xxxx 00000
Buyer: Venturi Technologies, Inc.
000 Xxxxx 000 Xxxx
Xxxx, Xxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Chairman and CEO
Phone: (000) 000-0000
Fax: (000) 000-0000
(With a copy to Xxxxx X. Xxxxxxx, Chief Counsel)
10.4 JURISDICTION; SERVICE OF PROCESS. Any action or proceeding seeking to
enforce any provision of, or based on any right arising out of, this Agreement
may be brought against any of the parties in the courts of the State of Utah,
County of Salt Lake, or, if it has or can acquire jurisdiction, in the United
States District Court for the Central District of Utah, and each of the parties
consents to the jurisdiction of such courts (and of the appropriate appellate
courts) in any such action or proceeding and waives any objection to venue laid
therein. Process in any action or proceeding referred to in the preceding
sentence may be served on any party anywhere in the world.
10.5 FURTHER ASSURANCES. The parties agree (a) to furnish upon request to
each other such further information, (b) to execute and deliver to each other
such other documents, and (c) to do such other acts and things, all as the other
party may reasonably request for the purpose of carrying out the intent of this
Agreement and the documents referred to in this Agreement.
10.6 WAIVER. The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay by any party
in exercising any right, power, or privilege under this Agreement or the
documents referred to in this Agreement will operate as a waiver of such right,
power, or privilege, and no single or partial exercise of any such right, power,
or privilege will preclude any other or further exercise of such right, power,
or privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right arising out of
this Agreement or the documents referred to in this Agreement can be discharged
by one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing signed by the other party; (b) no waiver that may be
given by a party will be applicable except in the specific instance for which it
is given; and (c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party giving such
notice or demand to take further action without notice or demand as provided in
this Agreement or the documents referred to in this Agreement.
10.7 ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes all prior
agreements between the parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement between the parties with
respect to its subject matter. This Agreement may not be amended except by a
written agreement executed by the party to be charged with the amendment.
10.8 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. Neither party may
assign any of its rights under this Agreement without the prior consent of the
other parties, except that Buyer may assign any of its rights under this
Agreement to any Subsidiary of Buyer. Subject to the preceding sentence, this
Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the successors and permitted assigns of the parties. Nothing
expressed or referred to in this Agreement will be construed to give any person
other than the parties to this Agreement any legal or equitable right, remedy,
or claim under or with respect to this Agreement or any provision of this
Agreement. This Agreement and all of its provisions and conditions are for the
sole and exclusive benefit of the parties to this Agreement and their successors
and assigns.
10.9 SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
10.10 GOVERNING LAW. This Agreement will be governed by the laws of the
State of Utah without regard to conflicts of laws principles.
11.14 TAX ELECTIONS. Seller acknowledge that the Buyer may, in its sole
discretion, make certain tax elections with respect to this transaction,
including, but not necessarily limited to, an election under Section 338 of the
Internal Revenue Code of 1986, as amended, to treat this transaction for tax
purposes as though it were a purchase and sale of assets rather than stock.
11.15 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first written above.
BUYER:
VENTURI TECHNOLOGIES, INC.
By:
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Its:
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SELLER:
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Xxxxxxx X. Xxxxxxx
