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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made and entered
into as of November 11, 1997, by and between XXXX X. XXXXXX (the
"Purchaser") and TURTLEBACK MOUNTAIN GOLD CO., INC., an Arizona
corporation (the "Corporation").
1. Purchase and Sale of Stock; Grant of Stock Options.
(a) Upon the terms and conditions herein contained, on the
date hereof, the Corporation hereby agrees to sell to the Purchaser,
and the Purchaser hereby agrees to purchase from the Corporation,
135,000,000 shares of Common Stock (the "Stock") of the Corporation
for a total purchase price of Ten Thousand Dollars ($10,000), payable
on or before December 1, 1997. 33,750,000 shares of Stock of the
Corporation are to be delivered to the Purchaser by the Escrow Agent
upon payment of the full purchase price; 33,750,000 shares of Stock
of the Corporation are to be delivered to the Purchaser by the Escrow
Agent on or before May 31, 1998; 33,750,000 shares of Stock of the
Corporation are to be delivered to the Purchaser by the Escrow Agent
on or before December 1, 1998; and 33,750,000 shares of Stock of the
Corporation are to be delivered to the Purchaser by the Escrow Agent
on or before May 31, 1999. If the Purchaser has permanently
terminated his association with the Corporation prior to May 31, 1999
any shares of Stock of the Corporation still to be delivered to the
Purchaser on the next or forthcoming due dates shall be returned to
the Corporation for cancellation and any unused portion of the
purchase price shall be remitted to the Purchaser at the rate of
$.000074 for each share returned to the Corporation under this
paragraph 1(a).
(b) The Corporation hereby grants to the Purchaser options
(the "Stock Options") to purchase (i) up to 40,000,000 shares of the
Stock during the ten year period commencing on the second anniversary
of the date of this Agreement for the exercise price of one cent
($0.01) per share, and (ii) up to 40,000,000 additional shares of the
Stock during the ten year period commencing on the third anniversary
of the date of this Agreement for the exercise price of two cents
($0.02) per share.
(c) The Stock Option shall be protected against dilution
in the case of stock splits.
2. Closing.
The closing of the purchase of Stock contemplated by
paragraph 1(a) hereof shall be held at the offices of the
Corporation, 000 Xxx xx Xxx Xxxxx, Xxxx Xxxxxx, Xxxxxxxx 00000, at
10:00 a.m. on the date hereof (the "Closing Date"). On the Closing
Date. the Corporation shall execute, issue and deliver to the
Purchaser a fully signed copy of this Agreement and a stock
certificate registered in the name of the Purchaser for 135,000,000
shares of the Stock and legend to reflect the Purchaser's
representation in Section 4. The Purchaser shall execute and deliver
to the Corporation a signed copy of this Agreement and his check for
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$10,000 dated on or before December 1, 1997. The stock certificate
shall be placed in escrow with Berlack, Israels and Xxxxxxxx, LLP,
("Escrow Agent"),120 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention Xxxxx Xxxx, Esq. with instructions to release the shares of
Stock as noted in paragraph 1(a) herein.
3. Representations, Warranties, Covenants of Corporation.
The Corporation represents and warrants to and Covenants
with the Purchaser as follows:
(a) The Corporation is a corporation duly organized,
validly existing, and in good standing under the laws of Arizona and
has all necessary corporate power to own its properties and to carry
on its business as now owned and operated by it. The Corporation's
principal office is at its address set forth in Section 6 hereof.
The Corporation has 3,000,000,000 shares of Stock authorized under
its certificate of incorporation, of which 898,000,000 shares are
currently issued and outstanding, and 800,000,000 shares are reserved
for issuance upon the exercise of common stock purchase warrants that
are currently issued and outstanding.
(b) Attached to this Agreement are (i) the audited
financial statements of the Corporation as of December 31, 1996 and
for the twelve month period then ended, and (ii) the unaudited
financial statements of the corporation as of September 30, 1997 and
for the nine month period then ended. Such financial statements
fairly present the Corporation's financial condition as of the dates
specified, and its operating results for the periods ending on such
dates, all in accordance with generally accepted accounting
principles consistently applied.
(c) The execution, delivery and performance of this
Agreement and the issuance and sale of 135,000,000 shares of the
Stock hereunder and the grant of the Stock Options to purchase up to
80,000,000 additional shares of the Stock hereunder have been duly
authorized by the Corporation's board of directors, and will not
violate (i) the Corporation's certificate of incorporation, bylaws
and the proceedings (minutes and consents) of its board of directors
and stockholders, (ii) any agreement to which the Corporation is a
party or by which it or its properties are bound, or (iii) any
administrative or judicial order binding on the Corporation. This
Agreement is the valid and binding obligation of the Corporation and
is enforceable against it in accordance with its terms.
(d) The Stock (including the Stock underlying the Stock
Options hereby granted), when issued and paid for in accordance with
this Agreement, will be, in all respects, duly authorized and validly
issued, full paid and non-assessable. The 80,000,000 shares of the
Stock underlying the Stock Options have been duly reserved for
issuance upon the exercise of such options and are not available for
any other purpose.
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(e) The Corporation shall submit the Stock Options granted
to the Purchaser hereunder to the stockholders of the Corporation for
their approval before the end of 1997, and the Corporation shall use
its best efforts to obtain the requisite stockholder approval of the
Stock Options.
4. Investment Representation.
The Purchaser represents and warrants to the Corporation
that the Purchaser is purchasing the Stock (including any Stock he
may elect to purchase upon exercising his Stock Options granted
hereunder) for investment and not with a view to reselling or
otherwise distributing the Stock and acknowledges that the
Corporation has relied on such representation and warranty for the
purpose of issuing the Stock without registration under federal law
or qualification under state law.
5. Buy-back; Right of First Refusal.
The Corporation shall cause the Purchaser to be elected an
executive officer or a director of the Corporation as of the date of
this Agreement. If the Purchaser ceases to be affiliated with the
Corporation in such capacity at any time during the term of this
Agreement, then, in such event, the Purchaser shall be subject to no
further restrictions regarding the sale or other disposition of his
shares of Stock of the Corporation, other than restrictions that
may be imposed upon him under the Securities Act; provided, however,
that, for a period of twelve months following the date Purchaser
ceases to be affiliated with the Corporation, he shall offer any
shares he proposes to sell, in writing, at such price and on such
terms as the Purchaser reasonably believes a willing buyer would buy
such shares, to the Corporation which shall be deemed to have a right
of first refusal with respect to such shares of Stock of the
Corporation, and shall consider and either accept or reject any such
offer within ten calendar days of the date he gives notice to the
Corporation. If such offer is rejected by the Corporation then the
Purchaser shall be free to sell or otherwise dispose of his shares.
The Purchaser shall offer any Stock Options he proposes to
sell, in writing, at such price and on such terms as the Purchaser
reasonably believes a willing buyer would buy such options, to the
Corporation which shall be deemed to have a right of first refusal
with respect to such options, and shall consider and either accept
or reject any such offer within ten calendar days of the date he
gives notice to the Corporation. If such offer is rejected by the
Corporation then the Purchaser shall be free to sell or otherwise
dispose of his Stock Options.
6. Notices.
Any notice, request, demand, or other communication given
pursuant hereto by any of the parties hereto to any other party
hereto shall be in writing and shall be delivered personally,
certified mail return receipt requested, or by telex/facsimile
transmission with all charges prepaid, to the address set forth
below:
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If to the Purchaser: Xxxx X. Xxxxxx
00 Xxxxxxx Xxxxx
Xxxx Xxxxxxxxx, Xxx Xxxx 00000
With a copy to: Xxxxx X. Xxxx, Esq.
Berlack, Israels & Xxxxxxxx LLP
000 Xxxx 00xx Xxxxxx, 00xx Xx.
Xxx Xxxx, Xxx Xxxx 00000
If to the Corporation: Turtleback Mountain Gold Co., Inc.
000 Xxx xx Xxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Chairman
With a copy to: Xxxxx X. Xxxx, Esq.
Xxxxxxxxx Xxxxx
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
or to such other address as hereafter shall be furnished as provided
herein by any of the parties hereto to the other parties hereto. All
notices, requests, demands, and other communications under this
Agreement shall be deemed to have been given on the date of service
if personally served on the party to whom notice is to be given, or
within five calendar days after mailing, if mailed to the party to
whom notice is to be given, by certified mail, return receipt
requested, postage prepaid, properly addressed to the party at its
address set forth above, or within 24 hours after transmission by
telex/facsimile transmission to the address set forth above, with all
charges prepaid.
7. Miscellaneous.
(a) Each of the parties hereto agrees to perform any
further acts and execute and deliver any documents that may be
reasonably necessary to carry out the provisions of this agreement.
(b) The provisions of this Agreement may not be waived,
altered, amended or repealed, in whole or in part, except with the
written consent of all parties to this Agreement.
(c) This Agreement shall be binding on, and shall inure to
the benefit of, the Corporation and the Purchaser and their
respective successors and, subject to paragraph (f) below, assigns.
(d) This Agreement shall be construed in accordance with
the laws of the State of Arizona. To the extent permitted by
applicable law, each party hereby irrevocably submits generally and
unconditionally to the non-exclusive jurisdiction of any Arizona
state court or any United States federal court sitting in the State
of Arizona.
(e) This Agreement, including the attachment(s) hereto,
contain all of the terms and conditions agreed on by the parties
hereto with reference to the subject matter hereof. No other
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agreements not specifically referred to herein, oral or otherwise,
shall be deemed to exist or bind any of the parties hereto. No
officer, employee or partner of any party has any authority to make
any representation or promise not contained in this Agreement, and
each of the parties hereto agrees that it has not executed this
Agreement in reliance upon any such representation or promise.
(f) This Agreement shall not be assignable or assigned by
the Corporation without the prior written consent of the Purchaser or
by the Purchaser without the prior written consent of the
Corporation.
IN WITNESS WHEREOF, this Stock Purchase Agreement has been
signed and delivered by the parties hereto as of the date first above
written.
TURTLEBACK MOUNTAIN GOLD CO., INC.
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Chairman of the Board
/s/ Xxxx X. Xxxxxx
XXXX X. XXXXXX
Witnessed:
_____________________________
