STOCK PURCHASE AGREEMENT
AMONG
TERMINATOR TECHNOLOGIES, INC.,
AMJ RESOURCES, INC.,
ENVIRONMENTAL PLUS, INCORPORATED,
X.X. XXXXXXXXX,
XXXXXXX XXXXX,
GD.JD, INC.,
AND
NORTPORT MANAGEMENT GROUP, INC.
January 15, 1998
TABLE OF CONTENTS
Page
ARTICLE 1. PURCHASE AND SALE OF EPI SHARES; CLOSING 1
1.1. Purchase and Sale of EPI Shares 1
1.2. Closing 2
ARTICLE 2.REPRESENTATIONS AND WARRANTIES OF EPI AND
SELLING SHAREHOLDERS 2
2.1. Organization; Good Standing 2
2.1. Subsidiaries 2
2.2. Capitalization 2
2.3. Authority; Enforceability; Non-Contravention 3
2.4. Taxes 3
2.5. Property 4
2.6. Transferred Shares 4
2.7. Contracts 4
2.8. Litigation 4
2.9. Governmental Permits 4
2.10. Compliance with Laws 4
2.11. Employee Plans 5
2.12. Finder's Fees 5
2.13. Directors, Officers and Employees 5
2.14. Bank Accounts, etc. 5
2.15. Real Property 5
2.16. Employees, Labor Matters, Etc. 5
2.17. HSR 6
2.18. Records 6
2.19. Further Representation 6
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF TTI 6
3.1. Organization; Good Standing; Listing 6
3.2. Authority; Enforceability; Non-Contravention 6
3.3. Finder's Fees 7
3.4. HSR 7
3.5. Investment Intent 7
3.6. Further Representations 7
ARTICLE 4. COVENANTS OF EPI AND THE SELLING SHAREHOLDERS 7
4.1. Operation Prior to the Closing Date 7
4.2. No Solicitation 8
ARTICLE 5. ADDITIONAL AGREEMENTS 9
5.1. Shareholders Meetings; Proxy Statement 9
(i)
5.2. Access 9
5.3. Reasonable Efforts 10
5.4. Public Announcements 10
5.5. Notification of Certain Matters 10
5.6. Resignation of Directors of EPI 10
5.7. Proposed Stock Split 10
5.8. Expenses 11
5.9. Retirement of Preferred Shares 11
ARTICLE 6. CONDITIONS PRECEDENT TO CLOSING BY BUYER 11
6.1. Representations and Warranties 11
6.2. EPI Documents 11
6.3. Selling Shareholder Documents 12
6.4. EPI Obligations Performed 12
6.5. Satisfaction or Waiver of Conditions
Precedent of EPI 12
6.6. TTI's Investigation 12
ARTICLE 7. CONDITIONS PRECEDENT TO CLOSING BY EPI AND THE
SELLING SHAREHOLDERS 13
7.1. Stockholder Approval 13
7.2. Representations and Warranties 13
7.3. TTI Documents 13
7.4. Satisfaction or Waiver of Conditions
Precedent of TTI 14
7.5. TTI Obligations Performed 14
ARTICLE 8. TERMINATION 14
8.1. Termination by Mutual Consent 14
8.2. Termination by EPI or the Selling Shareholders 14
8.3. Termination by TTI 14
8.4. Termination Resulting from Acquisition Proposals 15
8.5. Effect of Termination 15
ARTICLE 9. DEFINITIONS 15
9.1. Definitions 15
9.2. Defined Terms 18
ARTICLE 10. MISCELLANOUS 18
10.1. Expenses of the Transaction 18
10.2. Further Assurances 18
10.3. Notices 18
10.4. No Modification Except in Writing 19
10.5. Entire Agreement 19
10.6. Severability 19
10.7. Assignment 19
10.8. Publicity; Announcements 20
10.9. Choice of Law 20
10.10. Captions; Construction 20
(ii)
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement"), is made
and entered into as of the 15th day of January, 1998, by and
among TERMINATOR TECHNOLOGIES, INCORPORATED, a Texas corporation
("TTI"), AMJ RESOURCES, INC., a Delaware Corporation ("AMJ" and
collectively with TTI and their respective assigns, referenced to
as "Buyer"), ENVIRONMENTAL PLUS, INCORPORATED, a Texas
corporation ("EPI"), XXXXXX XXXXX, ("Xxxxx"), X. X. XXXXXXXXX
("Xxxxxxxxx"), XXXXXXX XXXXX ("White"), GD/JD, INC. ("GD/JD") and
NORTHPORT MANAGEMENT GROUP, INC. ("Northport"). Collectively,
Davis, Davenport, White, GD/JD and Northport are referred to as
the "Selling Shareholders."
W I T N E S S E T H:
WHEREAS, EPI has proposed to consummate a reverse stock
split on the terms set forth in Schedule A (the "Proposed Stock
Split"), pursuant to which each outstanding share of EPI Common
stock, $ .001 par value per share, will be converted into 0.1
shares of EPI common stock, $.01 par value per share (the "EPI
Shares");
WHEREAS, except as otherwise set forth herein, all
references to EPI Shares contained herein assume consummation of
the Proposed Stock Split;
WHEREAS, the Selling Shareholders desire to sell to Buyer an
aggregate of 2,362,282 EPI Shares ("Transferred Shares") as
further set forth on Schedule A attached hereto, which
Transferred Shares will represent approximately 58% of the then
outstanding shares of EPI Common;
WHEREAS, EPI desires to sell to Buyer, and Buyer desires to
purchase from EPI, a warrant (the "Warrant") to acquire up to 1.5
million EPI Shares (the "Warrant Shares"), upon terms and
conditions set forth herein;
WHEREAS, the parties hereto desire to make certain
representations, warranties and agreements in connection with the
proposed purchase and sale of EPI Shares and to set forth various
conditions to the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the premises,
representations and warranties and mutual covenants and
agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, each of the parties hereto, intending to be legally
bound, hereby agrees as follows:
ARTICLE 1. PURCHASE AND SALE OF EPI SHARES; CLOSING
1.1. PURCHASE AND SALE OF EPI SHARES. In reliance upon the
representations and warranties and subject to the terms and
conditions of this Agreement, (a) each Selling Shareholder hereby
agrees to sell, assign, transfer and deliver to Buyer, and Buyer
hereby agrees to purchase from each Selling
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Shareholder, the number of Transferred Shares set forth beside
each such Selling Shareholder's name on Schedule A attached hereto,
at the Closing at the purchase price of $0.04445 per EPI Share
("Per Share Purchase Price"), representing an aggregate amount of
$105,003.43 (the "Shareholder Proceeds"), and (b) EPI hereby agrees
to sell and issue to Buyer, and Buyer agrees to purchase from EPI,
at the Closing the Warrant for an aggregate consideration of
$20,000 (the "EPI Proceeds"). The Warrant shall provide the Buyer
the right to acquire up to 1.5 million shares of (EPI Common at an
exercise price per share equal to the Per Share Purchase Price,
and shall expire on January 5, 2000. The Warrant shall be in
substantially the same form and substance as Exhibit A attached
hereto.
1.2. CLOSING. The Closing of the purchase and sale of
the Transferred Shares and the Warrant (the "Closing") shall take
place at 10:00 a.m. on a date (the "Closing Date") to be
specified by the parties, which shall be no later than the fifth
(5th) business day after the satisfaction or waiver of the
conditions set forth in Articles 6 and 7 hereof, unless another
date or place is agreed to in writing by the parties hereto, at
the offices of Xxxxx & Xxxxxx LLP, Dallas, Texas, or some other
mutually agreeable location in Dallas, Texas.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF EPI AND SELLING
SHAREHOLDERS
EPI and each Selling Shareholder hereby jointly and
severally represent and warrant to Buyer with regard to EPI, and
each Selling Shareholder represents and warrants with respect to
itself or himself individually, as applicable as follows;
provided that, the representations and warranties set forth below
assume the consummation of the disposition of the shares of GCCTS
and FZI by EPI prior to the Closing and therefore do not include
any assets or liabilities or other matters relating to GCCTS or
FZI:
2.1. ORGANIZATION; GOOD STANDING. EPI is a corporation duly
organized, validly existing and in good standing under the laws
of the State of Texas and is qualified as a foreign corporation
in all jurisdictions in which it is required to qualify as a
result of the conduct of its business or ownership of its
properties and where the failure to be so qualified could
reasonably be anticipated to have a Material Adverse Effect. EPI
has delivered to TTI complete and correct copies of its
Certificate of Incorporation and Bylaws as in effect on the date
hereof.
2.2. SUBSIDIARIES. EPI does not have any Subsidiaries, and
does not own, directly or indirectly, any shares of stock or any
other equity or long-term debt securities of any corporation or
have any equity interest in any firm, partnership, Joint Venture,
association or other Person.
2.3. CAPITALIZATION. The authorized capital stock of EPI as
of the date of this Agreement consists of 100,000,000 shares of
common stock, $.001 par value per share, of which 40,433,549
shares are issued and outstanding, and 100,000,000 shares of
preferred stock, $1.00 par value per share ("EPI Preferred"), of
which 1,049,000 shares are issued and outstanding. Following the
Proposed Stock Split and other transactions contemplated hereby,
the authorized capital stock of EPI will consist of 100,000,000
shares of common stock, $.01 par value per share, of which
4,043,354 shares will be issued and outstanding, and 100,000,000
shares of Preferred Stock, $1.00 par value per share, none of
which will be outstanding. There are no outstanding options,
warrants, calls, puts, commitments and other rights to purchase,
or securities or other rights convertible or exchangeable
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into, capital stock of EPI. All securities issued or issuable by
EPI have been paid for and delivered in accordance with the terms
of applicable agreements or instruments, duly authorized and
validly issued and are fully paid and non-assessable; the holders
thereof have no rights of rescission with respect thereto and are
not subject to personal liability by reason of being such
holders; none of such securities were issued in violation of the
preemptive rights of any holder of any security of EPI or any
similar rights granted by EPI or Applicable Law. Schedule 2.3
also sets forth the anticipated stock ownership of EPI following
the Proposed Stock Split. No person has any rights to require or
join in the registration of any securities of EPI.
2.4. AUTHORITY; ENFORCEABILITY; NON-CONTRAVENTION. EPI has
the corporate power and authority to conduct the business and
activities conducted by it and to own or lease the assets owned
or leased by it. EPI, GD/JD and Northport, as applicable, each
has the corporate power and authority (subject to the approval of
the shareholders of EPI as set forth in Section 7.1) to execute
and deliver this Agreement and all other documents required to be
executed and delivered by EPI, GD/JD and Northport, as
applicable, hereunder, to consummate the transactions hereby
contemplated, and to take all other actions required to be taken
by such party pursuant to the provisions hereof. This Agreement
and all other documents required to be executed and delivered by
EPI hereunder have been duly authorized by all corporate action
necessary on the part of EPI, GD/JD and Northport, as applicable,
(subject to the approval of the shareholders of EPI as set forth
in Section 7.1) and have been duly, or will when executed and
delivered be duly, executed and delivered by EPI and the Selling
Shareholders, as applicable and constitute the legal, valid and
binding obligations of such party, enforceable against such party
in accordance with their terms. Neither the execution nor the
delivery of this Agreement or any other documents required to be
executed and delivered by EPI or the Selling Shareholders
hereunder or the consummation of the transactions contemplated
hereby (i) conflicts with or constitutes any violation or breach
of the Certificate of Incorporation or the Bylaws of EPI or such
Selling Shareholders; (ii) constitutes any violation or breach
of, or gives any other Person any rights (including any right of
acceleration, termination or cancellation) under, any EPI
Contract or other document or agreement to which EPI is a party,
the violation of which, in the aggregate, could reasonably be
expected to have a Material Adverse Effect; (iii) constitutes a
violation of any Order or Applicable Law; or (iv) will result in
the creation of any Lien on any of the assets or properties of
EPI or the Selling Shareholders. None of the Selling
Shareholders is suffering under any legal disability which would
prevent him, her or it from executing, delivering or performing
the obligations hereunder or consummating the transactions
contemplated hereby or made such execution, delivery, performance
or consummation verbal or subject to necessary ratification, and
no signature or consent of any third party is necessary in
connection therewith for the transactions contemplated hereby to
be binding upon and enforceable against the Selling Shareholders
and their property.
2.5. NO UNDISCLOSED LIABILITIES. EPI does not have any
Liabilities that, in the aggregate, reasonably could be
anticipated to exceed $5,000 except for legal, accounting, and
similar transaction costs incurred in connection with this
Agreement or transactions contemplated hereby.
2.6. TAXES. All Taxes levied, assessed, or imposed upon EPI
have been duly and freely paid. All filings, returns, and
reports with respect to Taxes required by any foreign or domestic
law or regulation to be filed by EPI on or prior to the date
hereof have been duly and timely filed, except where such
failures to file, in the aggregate, could not reasonably be
anticipated to result in EPI's payment of in excess of $5,000 for
periods prior to December 31, 1997. There are no agreements,
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waivers or other arrangements (oral or written) currently in
force providing for extensions of time with respect to the
assessment or collection of unpaid Taxes, nor, are there any
actions, suits, proceedings, inquiries, investigations or claims
of any nature or kind whatsoever now pending or, to the Knowledge
of EPI, threatened, against EPI with respect to any such returns
or reports, or any such Taxes, or any matters under discussion
with any federal, state, county, local or other authority
relating to Taxes.
2.7. PROPERTY. EPI has no material assets.
2.8. TRANSFERRED SHARES. Immediately prior to and at the
Closing and following the Proposed Stock Split, the Selling
Shareholders shall be the sole and lawful owner of the shares set
forth beside each such shareholder's name identified as
"Transferred Shares" in Schedule A hereto, representing 2,362,282
shares or approximately 58% of the outstanding shares of EPI at
Closing. On the Closing Date, the Selling Shareholders shall
hold all Transferred Shares free and clear of all liens, and
covenants or adverse claims of any kind or character. Each of
the Selling Shareholders has full records and beneficial
ownership of the number of shares of EPI Common set forth on
Schedule A. There are no written instruments, buy-sell
agreements or other agreements by and between or among EPI, any
EPI Subsidiary or any of the Selling Shareholders, whether or not
EPI is a party thereto, imposing any restrictions upon the
transfer prohibiting the transfer of or otherwise pertaining to
Transferred Shares or the ownership thereof.
2.9. CONTRACTS. EPI is not a party to any material
contract. At or prior to Closing, EPI shall cancel all contracts
other than those specifically designated by Buyer to continue
following the Closing.
2.10. LITIGATION. There is no claim or Proceeding, in each
case domestic or foreign, pending or, to the Knowledge of EPI,
threatened against, or involving the properties or business of
EPI which (a) questions the validity of the issuance of the
capital stock of EPI, this Agreement or any action taken or to be
taken by EPI pursuant to or in connection with this Agreement; or
(b) could otherwise reasonably be anticipated to have a Material
Adverse Effect.
2.11. GOVERNMENTAL PERMITS. EPI does not own, hold or
possess any Governmental Permits.
2.12. COMPLIANCE WITH LAWS. Except for any violations of
Applicable Law arising from EPI's failure to timely file its
Annual Report on Form 10-K for its fiscal year ended August 31,
1997 (which remains unfiled). EPI has complied with Applicable
Law and Orders of any Governmental Authority having jurisdiction
over it or its operations, including, but not limited to, all
rules or regulations regulating, if applicable, zoning, fair and
equal employment practices, the safety of the workplace, the
discharge of materials into the Environment or otherwise relating
to the protection of the Environment, antitrust, anti-monopoly or
anti-competitive activities, wages, hours, collective bargaining
and the payment of withholding and social security taxes except
to the extent that such non-compliance or partial compliance
could not reasonably be anticipated to have a Material Adverse
Effect. EPI has not received any written notice or, to its
Knowledge, oral notice from any Person to the effect that, or
otherwise been advised that, EPI is not in compliance with any
Applicable Law, ordinance, regulation, building or zoning law,
except to the extent that such non-compliance or partial
compliance could not reasonably be anticipated to have a Material
Adverse Effect, and EPI has no reason to anticipate that any
existing circumstances are likely to result in a violation of any
law, statute,
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ordinance or regulation, the non-compliance or partial compliance
with which could reasonably be anticipated to have a Material
Adverse Effect.
2.13. EMPLOYEE PLANS. EPI does not maintain, or during the
three year period preceding the date hereof has not maintained,
any "employee benefit plan," as such term is defined in section
3(3) of ERISA, whether or not subject to ERISA, or any bonus,
incentive or deferred compensation, severance, termination,
retention, change of control, stock option, stock appreciation,
stock purchase, phantom stock or other equity-based, performance
or other employee or retiree benefit or compensation plan,
program, arrangement, agreement, policy or understanding, whether
written or unwritten, that provides or may provide benefits or
compensation in respect of any employee or former employee of EPI
or the beneficiaries or dependents of any such employee or former
employee (such employees, former employees, beneficiaries and
dependents collectively, the "EPI Employees") or under which any
EPI Employee is or may become eligible to participate or derive a
benefit, or any other plan which exists to benefit or compensate
employees, (collectively, the "EPI Plans").
2.14. FINDER'S FEES. EPI has not taken any action which
would impose any obligation or liability to any person for
finder's fees, agent's commissions or like payments in connection
with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
2.15. DIRECTORS, OFFICERS AND EMPLOYEES. Schedule 2.15 sets
forth a list of all directors, officers or managers of EPI.
Except as set forth on Schedule 2.15, EPI does not have any
outstanding loans or extension of credit to, or any contracts,
agreements or understandings with, any executive officer or
director or member of their immediate family or any person with
which any such person has a material relationship.
2.16. BANK ACCOUNTS, ETC. Schedule 2.16 sets forth a list of
all (i) bank accounts of EPI and the persons authorized to draw
thereon and the balances thereof as of the date hereof; (ii) safe
deposit boxes of EPI and the persons who have access thereto; and
(iii) powers of attorney for tax purposes or otherwise and a
summary of the terms thereof.
2.17. REAL PROPERTY. EPI does not own or lease, directly or
indirectly, or have any fixed or contingent obligation to
acquire, any interest in any real property that is used in any
manner in connection with its respective business.
2.18 EMPLOYEES, LABOR MATTERS, ETC. There are no labor
disputes currently subject to any grievance procedure,
arbitration or litigation and there is no petition pending or, to
the Knowledge of EPI, threatened with respect to any employee
employed in the operation of the business of EPI that could
reasonably be anticipated to have a Material Adverse Effect. To
the Knowledge of EPI, EPI has complied with all provisions of
Applicable Law pertaining to the employment of employees,
including, without limitation, all such Applicable Law relating
to labor relations, equal employment, fair employment practices,
entitlement, prohibited discrimination or other similar
employment practices or acts, except to the extent that any
failure so to comply, individually or together with all other
such failures, has not had or resulted in, or could not
reasonably be anticipated to have or result in, a Material
Adverse Effect.
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2.19. HSR. Immediately prior to the Closing, the "Person"
(as defined in the regulations issued by the Federal Trade
Commission under the HSR Act) within which EPI is included will
have total assets (as shown on its last regularly prepared
balance sheet) and annual net sales (as shown on its last
regularly prepared annual statement of income and expenses) of
less than $100,000,000.
2.20 RECORDS. The respective minute books, comment books of
account, stock record books and other records of EPI, all of
which have been or will be made available to Buyer, contain
accurate and complete records of all corporate actions of the
respective stockholders and boards of directors (and committees
thereof) during the periods of time in which such minute books
were maintained.
2.21. FURTHER REPRESENTATION. No representation or warranty
of EPI contained in this Agreement contains any untrue statement
of, or omits to state, a material fact necessary in order to make
the statements made herein, in light of the circumstances under
which they are made, not misleading. Copies of all documents
listed in the Schedules and furnished or given, or to be
furnished or given, by EPI to Buyer or Buyer's agents are or will
be true, complete and genuine.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF TTI
TTI and AMJ hereby represent and warrant, jointly and
severally, to EPI and the Selling Shareholders that as of the
date hereof:
3.1. ORGANIZATION; GOOD STANDING. TTI and AMJ are each a
corporation duly organized, validly existing and in good standing
under the laws of the States of Texas and Delaware, respectively,
and are qualified as a foreign corporation in all jurisdictions
in which it is required to qualify as a result of the conduct of
its business or ownership of its properties and where the failure
to be so qualified could reasonably be anticipated to have a
Material Adverse Effect. TTI and AMJ have delivered to EPI and
the Selling Shareholders complete and correct copies of their
Articles of Incorporation and Bylaws as in effect on the date
hereof.
3.2. AUTHORITY; ENFORCEABILITY; NON-CONTRAVENTION. TTI and
AMJ each have the corporate power and authority to execute and
deliver this Agreement and all other documents required to be
executed and delivered by Buyer hereunder, to consummate the
transactions hereby contemplated, and to take all other actions
required to be taken by Buyer pursuant to the provisions hereof.
This Agreement and all other documents required to be executed
and delivered by Buyer hereunder have been duly authorized by all
corporate action necessary on the part of Buyer and have been
duly, or will when executed and delivered be duly, executed and
delivered by Buyer and constitute the legal, valid and binding
obligations of Buyer, enforceable against Buyer in accordance
with their terms. Neither the execution nor the delivery of this
Agreement or any other documents required to be executed and
delivered by Buyer hereunder or the consummation of the
transactions hereby contemplated by Buyer (i) conflicts with or
constitutes any violation or breach of the Articles of
Incorporation or the Bylaws of either Buyer; (ii) constitutes any
violation or breach of, or gives any other Person any rights
(including any right of acceleration, termination or
cancellation) under, any contract or other document or agreement
to which either Buyer is a party, the violation of which, in the
aggregate, could reasonably be expected to have a Material
Adverse Effect; (iii) constitutes a violation of any Order or
Applicable Law; or (iv) will result in the creation of any Lien
on any of the assets
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or properties of either Buyer. There are no consents, approvals,
permissions, licenses, authorizations or other requirements
described by any Applicable Law or by contract required to be
obtained or filed by either Buyer to permit the consummation by
either Buyer of the Transactions contemplated herein.
3.3. FINDER'S FEES. Buyer has not taken any action which
would impose any obligation or liability to any person for
finder's fees, agent's commissions or like payments in connection
with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
3.4. HSR. Immediately prior to the Closing, the "Person"
(as defined in the regulations issued by the Federal Trade
Commission under the HSR Act) within which Buyer is included will
have total assets (as shown on its last regularly prepared
balance sheet) and annual net sales (as shown on its last
regularly prepared annual statement of income and expenses) of
less than U.S. $ 100,000,000.
3.5. INVESTMENT INTENT. Buyer is acquiring the Transferred
Shares and the Warrant (and any Warrant Shares issued or issuable
upon the exercise thereof) purchased by it for its own account,
for investment and not with a view to, or for sale in connection
with, a distribution of such shares of EPI Common or any part
thereof. Buyer understands that the shares of EPI Common acquired
hereunder have not been, and will not be, registered under the
Securities Act of 1933, as amended, or under any state securities
laws, and are being offered or sold in reliance upon federal and
state exemptions for transactions not involving any public
offering. Buyer is a sophisticated investor with knowledge and
experience in business and financial matters and is experienced
in the valuation of businesses similar to EPI. Buyer has
received information concerning EPI and has been afforded, prior
to the Closing Date, the opportunity to ask questions of, and
receive answers from, EPI and the Selling Shareholders and to
obtain any additional information, to the extent available to EPI
without unreasonable effort or expense, necessary for Buyer to
make an informed investment decision with regard to the
Transferred Shares, the Warrant and the Warrant Shares.
3.6. FURTHER REPRESENTATION. No representation or warranty
of Buyer contained in this Agreement contains any untrue
statement of, or omits to state, a material fact necessary in
order to make the statements made herein, in light of the
circumstances under which they are made, not misleading. Copies
of all documents listed in the Schedules and furnished or given,
or to be furnished or given, by Buyer to EPI, the Selling
Shareholders or their respective agents are or will be true,
complete and genuine.
ARTICLE 4. COVENANTS OF EPI AND THE SELLING SHAREHOLDERS
EPI and the Selling Shareholders hereby agree to perform as
follows:
4.1. OPERATION PRIOR TO THE CLOSING DATE. Subject to the
provisions of Section 4.2, from the date hereof through the
Closing Date:
(a) EPI shall not engage in any practice, take any
action or enter into any transaction other than in the
customary and ordinary course of business without giving
prior notice to TTI.
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(b) EPI shall use its best efforts to (i) pay and
perform all of its debts, liabilities and obligations
consistent with past practices, except to the extent being
contested in good faith and as to which adequate reserves
(determined in accordance with GAAP) have been established,
(ii) comply in all respects with Applicable Law, except, in
each case, where the failure to so perform or comply could
not reasonably be anticipated to have a Material Adverse
Effect. Except as herein, EPI shall (i) not take any
action, and shall endeavor in good faith not to permit any
event to occur, which would cause or constitute a material
breach, or would, if such action or event had occurred prior
to the date of this Agreement, have caused or constituted a
material breach, of any of the representations and
warranties set forth in Article 2 hereof; (ii) in the event
of, and promptly after the occurrence of, or promptly after
becoming aware of the occurrence of or the impending or
threatened occurrence of, any event which would cause or
constitute a material breach or would, if it had occurred
immediately prior to the date hereof, have caused or
constituted a material breach of any of the representations
and warranties set forth in Article 2, give notice thereof
to Buyer; and (iii) use its best efforts to prevent or
promptly to remedy such breach.
(c) Except as contemplated herein, EPI shall not (i)
repurchase, declare or pay any dividends, (ii) make any
other distributions consisting of cash or marketable
securities or any combination thereof, or (iii) issue, sell
or agree to sell any shares of its capital stock, or any
securities convertible into, or options with respect to, or
warrants to purchase or rights to subscribe for, any shares
of its capital stock.
(d) EPI shall cancel all EPI contracts and extinguish
any liquidated or contingent Liabilities such that, at the
Closing, the combined total Liabilities of EPI shall not
exceed $5,000.
4.2. NO SOLICITATION. From and after the date hereof,
neither the Selling Shareholders nor EPI will, nor will they
permit any of their respective officers, directors, employees,
agents and other representatives (collectively,
"Representatives") to directly or indirectly, solicit, initiate
or encourage (including by way of furnishing information) any
inquiries or the making of any proposal which constitutes, or may
reasonably be expected to lead to, an Acquisition Proposal (as
defined herein) from any Person or engage in any discussion or
negotiations relating thereto or accept any Acquisition Proposal.
EPI and the Selling Shareholders shall immediately cease and
cause to be terminated any existing solicitation, discussion or
negotiation with any parties conducted heretofore by such party
or any Representatives with respect to any of the foregoing. To
the extent permitted by Applicable Law, EPI and the Selling
Shareholders will promptly notify Buyer of any such discussion or
negotiations, requests for such information or the receipt of any
Acquisition Proposal, including (a) the identity of the person or
group engaging in such discussions or negotiations, requesting
such information or making such Acquisition Proposal and (b) the
material terms and conditions of any Acquisition Proposal. As
used in this Agreement, "Acquisition Proposal" shall mean any
proposal or offer considered for a tender or exchange offer, a
merger, consolidation or other business combination involving EPI
or any proposal to acquire in any manner a substantial equity
interest in or businesses or asset of EPI. Notwithstanding the
foregoing, nothing in this Section 4.2 shall prohibit the Board
of Directors of EPI from furnishing information to or entering
into discussions or negotiations with, any person or entity that
makes an unsolicited bona fide proposal to acquire EPI pursuant
to a merger, consolidation, share exchange, purchase of a
substantial portion of the assets, business combination or some
other
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transaction, if, and only to the extent that (A) the Board of
Directors determines in good faith that such action is required
for the Board of Directors to comply with its fiduciary duty to
its stockholders, (B) prior to furnishing such information to, or
entering into discussions with or negotiations with, such person
or entity, to the extent permitted by Applicable Law, EPI
provides notice to Buyer to the effect that it is furnishing
information to, or entering into discussions or negotiations
with, such person or entity, and (C) to the extent permitted by
Applicable Law, EPI keeps Buyer informed, on a current basis, of
the status of any such discussions or negotiations.
ARTICLE 5. ADDITIONAL AGREEMENTS.
5.1. SHAREHOLDERS MEETING; PROXY STATEMENT.
(a) EPI shall take all action necessary in
accordance with Applicable Law and in accordance with its
certificate or articles of incorporation and bylaws to
convene a meeting of its respective stockholders as promptly
as practicable after the preparation of the Proxy Statement
(defined below), to consider and vote upon the approval of
this Agreement and transactions contemplated hereby.
Specifically, EPI shall seek the approval of its
shareholders for the following transactions (collectively,
the "Requested Approvals"): (i) the Proposed Stock Split and
adjustments to authorize capital, upon the terms set forth
in Section 5.7 hereof, (ii) the sale of the capital stock of
Gulf Coast Cooling Tower Service, Inc., a wholly owned
subsidiary of EPI ("GCCTS") to Xxxxx in exchange for all of
his shares of EPI Preferred, (iii) the sale of the capital
stock of Fire Zap, Inc. ("FZI") to H. Xxxxx Xxxxxxxx in
exchange for all of his shares of EPI Preferred, (iv) the
proposed amendment to its Certificate of Incorporation to
change its name from "Environmental Plus, Incorporated" to
"TTI Industries, Incorporated", and (v) the proposed
issuance of the Warrant.
(b) EPI shall prepare and file with the
Securities and Exchange Commission ("SEC") as soon as
practicable a proxy statement (the "Proxy Statement") with
regard to the Requested Approvals and any other matters
desired to be submitted for the approval of the shareholders
of EPI, and the Parties shall take such other actions as EPI
may reasonably request in connection with the preparation of
such Proxy Statement none of the information included by any
Party shall contain any material misstatement of fact or
omit to state and material fact or any facts necessary to
make these statements contained therein not misleading.
5.2. ACCESS. Each of Buyer (the "Reviewing Party") and
their respective officers, employees and representatives
(including independent public accountants, investment bankers,
environmental consultants and counsel), as applicable, will at
all reasonable times be permitted reasonable access to the
corporate offices and other facilities of EPI (the "Disclosing
Party"); will be permitted to make copies of or abstracts from
all of the books and records, financial and operating data and
other information of the Disclosing Party; and will be permitted
to discuss the affairs and accounts of the Disclosing Party with
the directors, officers, employees, counsel, and accountants of
the Disclosing Party. In the event the transactions contemplated
hereby should not close for any reason, the Reviewing Party
agrees that it will promptly return to the Disclosing Party all
such documents (including copies thereof) furnished by or on
behalf of the Disclosing Party to the Reviewing Party and its
representatives and the Reviewing Party shall hold in confidence
and shall not use or disclose to any
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third party any information concerning the Disclosing Party
obtained from such documents or otherwise in connection with the
transactions contemplated by this Agreement unless (a) such
information was at the time of its use or disclosure to any third
party by the Reviewing Party in the public domain other than as a
result of any breach of this provision by the Reviewing Party or
(b) such disclosure is required by Applicable Law.
5.3. REASONABLE EFFORTS. Each of the parties agrees to use
its reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and
cooperate with the other parties in doing, all things necessary,
proper or advisable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by
this Agreement, including (a) the obtaining of all necessary
actions or non-actions, waivers, consents and approvals from
Governmental Authorities and the making of all necessary
registrations and filings (including filings with Governmental
Authorities) and the taking of all reasonable steps as may be
necessary to obtain an approval or waiver from, or to avoid an
action or proceeding by any Governmental Authority; (b) the
obtaining of all necessary consents, approvals or waivers from
third parties, the absence of which, in the aggregate, could
reasonably be anticipated to have a Material Adverse Effect; (c)
the defending of any lawsuits or other legal proceedings, whether
judicial or administrative, challenging this Agreement or the
consummation of the transactions contemplated hereby including
seeking to have any stay or temporary restraining order entered
by any court or other Governmental Authority vacated or reversed;
and (d) the execution and delivery of any additional instruments
necessary to consummate the transactions contemplated by this
Agreement.
5.4. PUBLIC ANNOUNCEMENTS. Buyer and EPI will consult with
each other before issuing any press release with respect to the
transactions contemplated by this Agreement, and shall not issue
any such press release without the prior consent of the other,
which consent shall not be unreasonably withheld or delayed,
unless otherwise required under Applicable Law.
5.5 NOTIFICATION OF CERTAIN MATTERS. Each Party shall give
to the other prompt notice of: (i) any notice of, or other
communication relating to, a default or event that, with notice
or lapse of time or both, would become a default, received
subsequent to the date of this Agreement and prior to the Closing
under any note, license, agreement or other instrument or
obligation other than in respect of defaults which, individually
or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect; (ii) from and after the Proxy
Mailing Date, prompt notice of the occurrence of any event that
would require the information regarding EPI contained in the
Proxy Statement to be amended or supplemented under applicable
securities laws; and (iii) any Material Adverse Effect or the
occurrence of any event which, so far as reasonably can be
foreseen at the time of its occurrence, is reasonably likely to
result in a Material Adverse Effect. Each party shall give the
other prompt notice of any written notice or other written
communication from any third party alleging that the consent of
such third party is or may be required in connection with the
transactions contemplated by this Agreement.
5.6. RESIGNATION OF DIRECTORS OF EPI. EPI shall deliver to
Buyer, except as otherwise requested by Buyer, the written
resignation of all directors of EPI effective as of the Closing.
5.7. PROPOSED STOCK SPLIT. Functional Shares prior to the
Closing, EPI shall take such action as is necessary to cause a
reverse stock split of its shares of EPI Common, pursuant to
which
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each outstanding share of EPI Common will be exchanged for 0.1
shares of EPI Common; following the Proposed Stock Split,
fractional EPI Shares shall be repurchased by EPI at the Per
Share Purchase Price.
5.8. EXPENSES. EPI shall pay any and all expenses incurred
in connection with the Transactions contemplated hereby to the
extent and only to the extent that such expenses do not exceed
the EPI Proceeds from the sale of the Warrant or any proceeds
from the exercise of the warrant to purchase Warrant Shares. Any
other expenses shall be the joint and several responsibility of
the Selling Shareholders, and the Selling Shareholders shall
discharge all of such obligations prior to Closing.
5.9. RETIREMENT OF PREFERRED SHARES; SALE OF GCCTS AND FZI.
Prior to the Closing, EPI shall take such action as is necessary
to cause the cancellation of all outstanding shares of EPI
Preferred. In connection with such cancellation, EPI shall
transfer to Xxxxx, and Xxxxx shall accept as consideration for
the cancellation of shares of EPI Preferred held by Xxxxx, the
capital stock of GCCTS that was acquired by EPI from Xxxxx in
1996. In addition, EPI shall transfer to H. Xxxxx Xxxxxxxx as
consideration for the cancellation of the shares of EPI Preferred
held by him, the capital stock of FZI that was acquired by EPI
from him in 1996.
ARTICLE 6. CONDITIONS PRECEDENT TO CLOSING BY BUYER
The obligations of Buyer to consummate the Transactions are
subject to fulfillment, or written waiver signed by Buyer, of
each of the following conditions precedent on or prior to the
Closing Date.
6.1. REPRESENTATIONS AND WARRANTIES. Each and every
representation and warranty made by EPI and the Selling
Shareholders shall be true and correct (a) in all respects (with
regard to representation and warranties subject to materiality or
Material Adverse Effect qualifications) and (b) in all respects
other than the failure of which could not reasonably be
anticipated to have a Material Adverse Effect (with regard to
representations and warranties not subject to materiality or
Material Adverse Effect qualifications), in each case when made,
and shall be true and correct in all such respects as if
originally made on and as of the Closing Date.
6.2. EPI DOCUMENTS. EPI shall have delivered the following
to Buyer in form and substance reasonably satisfactory to Buyer
and its counsel:
(a) A certificate signed by the chief executive
officer of EPI, on behalf of and in his capacity as an
officer of EPI, confirming, on and as of the Closing Date,
(i) the satisfaction of the conditions contained in Section
6.1 pertaining to EPI (ii) that the Liabilities of EPI as of
such date do not exceed $5,000, and (iii) EPI's compliance
in all material respects with the applicable covenants set
forth in Articles 4 and 5.
(b) The Warrant.
(c) An opinion of counsel in a form reasonably
acceptable to Buyer.
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6.3. SELLING SHAREHOLDER DOCUMENTS. The Selling
Shareholders shall have delivered the following to Buyer in form
and substance reasonably satisfactorily to Buyer and its counsel:
(a) A certificate signed by each Selling Shareholder
(or an authorized representative thereof) confirming, all
and as of the Closing Date, (i) the satisfaction of the
conditions in Section 6.1 pertaining to the Selling
Shareholders (ii) that the Liabilities of EPI as of such
date do not exceed $5,000, and (iii) the Selling
Shareholder's compliance in all material respects with the
applicable covenants set forth in Articles 4 and 5.
(b) Undated resignations of all officers and directors
of EPI, to be effective at Closing.
(c) Standard investment letters by all persons holding
shares of EPI Common issued in transactions that were not
registered under the Securities Act of 1933 (collectively
referred to as the "Restricted Securities").
(d) Unconditional releases executed by each Selling
Shareholder releasing EPI from any obligations of any kind
to Selling Shareholders.
(e) A Shareholder's Agreement in the form attached
hereto as Exhibit B between the holders of all Restricted
Securities.
(f) A certificate signed by each Selling Shareholder
that, as of the Closing Date and to the best of their
knowledge, the shareholders of EPI are substantially the
same as the list of shareholdings and shareholders groups
attached hereto at Schedule 2.3 (designating therein
shareholder's holding Restricted Securities) dated no less
than 30 days prior to the Closing Date.
(g) Certificates representing an aggregate of
2,362,282 shares of EPI Common (following the Proposed Stock
Split), representing 58% of the then outstanding shares of
EPI Common, duly endorsed in blank or accompanied by duly
executed instruments of transfer, transferring to TTI good
title to the Transferred Shares, free and clear of all
liens.
6.4. EPI OBLIGATIONS PERFORMED. All obligations of EPI to
be performed hereunder through and including the Closing Date
shall have been performed in all material respects.
6.5. SATISFACTION OR WAIVER OF CONDITIONS PRECEDENT OF EPI.
Each of the conditions precedent to the obligations of EPI set
forth in Article 7 shall have been satisfied or otherwise waived
by EPI.
6.6. BUYER'S INVESTIGATION.
(a) The investigation by Buyer and its representatives
in connection with the transactions contemplated by this
Agreement shall not have caused Buyer or its representatives
to become aware of any facts or circumstances which relate
to the business,
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operations, assets, properties, liabilities, financial
condition, results of operation or affairs of EPI that, in
the good faith business judgment of Buyer, either (i)
represent a material adverse change or state of facts that
could reasonably be expected to result in a material adverse
change in the business, operations, assets, properties or
prospects of EPI from that described in Article 2 hereof, or
(ii) represent in the aggregate previously undisclosed
Liabilities that could reasonably be anticipated to result
in Damages in excess of $5,000.
(b) Buyer may deliver, based upon its review of
information delivered to or discovered by it on or prior to
the earlier of (i) the date on which the Proxy Statement is
to be mailed to the shareholders of EPI and Buyer ("Proxy
Mailing Date") or (ii) January 31, 1998, written notice of
its election to terminate this Agreement as a result of the
failure to satisfy the conditions in clause (a) above,
specifying in reasonable detail the reason therefor, and
Buyer's failure to deliver such termination notice on or
prior to such date shall constitute waiver of this condition
by Buyer.
ARTICLE 7. CONDITIONS PRECEDENT TO CLOSING BY EPI AND THE
SELLING SHAREHOLDERS.
The obligation of EPI to consummate the transactions
contemplated hereby is subject to fulfillment, or written waiver
signed by EPI and the Selling Shareholders, of each of the
following conditions precedent on or prior to the Closing Date.
7.1. STOCKHOLDER APPROVAL. The Required Approvals shall
have been approved by the requisite vote of the holders of the
EPI Shares in accordance with Applicable Law and its Certificate
of Incorporation and Bylaws.
7.2. REPRESENTATIONS AND WARRANTIES. Each and every
representation and warranty made by Buyer shall be true and
correct (a) in all respects (with regard to representations and
warranties subject to materiality or Material Adverse Effect
qualifications) and (b) in all respects other than the failure of
which could not reasonably be anticipated to have a Material
Adverse Effect (with regard to representations and warranties not
subject to materiality or Material Adverse Effect
qualifications), in each case when made and shall be true and
correct in all such respects as if originally made on and as of
the Closing Date.
7.3. BUYER DOCUMENTS. Buyer shall have executed and
delivered to EPI in form and substance reasonably satisfactory to
EPI and its counsel:
(a) A certificate of the chief executive officer of
Buyer, on behalf of and in his respective capacity as an
officer of Buyer, confirming, on and as of the Closing Date,
the satisfaction of the condition contained in Section 7.2
and the compliance by Buyer in all material respects with
the applicable covenants set forth in Articles 4 and 5.
(b) An investment representation letter regarding
Buyer's purchase of the Transferred Shares, the Warrant and
any Warrant Shares.
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(c) The Shareholders Agreement, executed by Buyer.
(d) The Shareholder Proceeds, payable as follows:
(i) Upon the execution hereof, $10,000;
(ii) Upon the delivery of the closing documents
to the Escrow Holder (defined below) by the
Selling Shareholders and EPI, $50,000;
(iii) No less than 10 days preceding the Closing,
$45,000.
Xxxx Held, Esq. of Xxxxx & Xxxxxx, LLP shall act as the "Escrow
Holder" for the funds and the documents to be delivered prior to
Closing. Escrow Holder shall be indemnified by all parties
hereto in and acting upon the joint written instructions of the
parties hereto with regard to the release of any documents or
funds, and Escrow Holder shall not have any obligation to release
any documents or funds so deposited without the written approval
of all parties hereto. Escrow Holder shall be fully indemnified
by all parties (jointly and severally) hereto for all actions
taken in release upon such joint instructions or otherwise.
Notwithstanding the preceding sentence, Escrow Holder shall be
deemed to have fully discharged his duties hereunder upon the
return of all documents and/or funds held hereunder to the Party
delivering the same.
(e) The EPI Proceeds, which shall be deposited
with the Escrow Holder concurrent with the delivery of the
installment to be paid pursuant to (d)(iii) above.
7.4. SATISFACTION OR WAIVER OF CONDITIONS PRECEDENT OF
BUYER. Each of the conditions precedent to the obligations of
Buyer set forth in Article 6 shall have been satisfied or
otherwise waived by EPI.
7.5. BUYER OBLIGATIONS PERFORMED. All obligations of Buyer
to be performed hereunder through and including the Closing Date
shall have been performed in all material respects.
ARTICLE 8. TERMINATION
8.1. TERMINATION BY MUTUAL CONSENT. This Agreement may be
terminated and may be abandoned at any time prior to the Closing
Date, before or after the approval of this Agreement by the
shareholders of EPI and Buyer, by the mutual consent of Buyer and
EPI.
8.2. TERMINATION BY EPI OR THE SELLING SHAREHOLDERS. This
Agreement may be terminated and the Transactions may be abandoned
by EPI if the closing conditions set forth in Article 7 shall not
have been satisfied in full or waived on or before April 9, 1998
or the date set forth therein.
8.3. TERMINATION BY BUYER. This Agreement may be terminated
by Buyer if the closing conditions set forth in Article 7 shall
not have been satisfied in full or waived on or before April 9,
1998 or the date set forth therein.
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8.4. TERMINATION RESULTING FROM ACQUISITION PROPOSALS. In
the event that any Person shall have made an Acquisition
Proposal, and the Board of Directors of EPI approves the
execution of an agreement relating thereto or recommends to the
stockholders of EPI the acceptance of any such acquisition
proposal, then the Selling Shareholders shall promptly, but in no
event later than two days after the date of such Board approval
or recommendation, pay to Buyer a fee of $5,000 as liquidated
damages, this Agreement shall terminate and the parties shall
have no further liability or obligations hereunder.
8.5. EFFECT OF TERMINATION. In the event of the termination
of this Agreement and abandonment of the Transactions (other than
as provided in Section 8.4 above, in which case the payment of
the amount specified therein shall be deemed to be liquidated
damages for any claims under this Agreement arising from a
termination resulting from an Acquisition Proposal), this
Agreement shall terminate and the parties shall have no
liabilities or obligations to each other hereunder, except as
provided in Section 5.2; provided that nothing contained herein
shall relieve any party of liability for fraud or willful breach
of this Agreement.
ARTICLE 9. DEFINITIONS
9.1. DEFINITIONS. The terms used in this Agreement have the
respective meanings specified or referred to in this Article 9:
"Acquisition Proposal" shall have the meaning set forth in
Section 4.2.
"Applicable Law" means any federal, state, local, municipal,
foreign or other law, statute, legislation, act, constitution,
ordinance, code, treaty, rule, regulation or guideline applicable
to or against EPI or Buyer.
"Authorization" means any license, permit, authorization,
franchise, grant, registration, certificate, consent and waiver
awarded to EPI or Buyer by a Governmental Authority which is
used, useable or held for use in or in conjunction with or
otherwise associated with the business of EPI, or Buyer.
"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banks in Dallas, Texas are
authorized or required to close.
"Close" or "Closing" means the consummation of the
Transactions as provided for in Section 1.3.
"Closing Date" means the date on which the Closing shall
occur as provided for in Section 1.3.
"Damages" means all losses,, liabilities, settlement
payments, awards, judgments, fines, penalties, damages,
deficiencies, court costs, costs of arbitration or administrative
proceedings, reasonable attorneys' fees and other reasonable
expenses and costs.
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"Disclosing Party" shall have the meaning set forth in
Section 5.2.
"Environment" means the soil, surface waters, ground waters,
land, stream, sediments, surface or subsurface strata and ambient
air.
"EPI Plans" shall have the meaning set forth in Section 2.
13(a).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Financial Statements" shall have the meaning set forth in
Section 2.5(a).
"FZI" shall have the meaning set forth in Section 5.1(a).
"GAAP" means generally accepted accounting principles as in
effect from time to time in the United States of America. The
term "generally accepted accounting principles" shall mean
accounting principles which are (a) consistent with the
principles promulgated or adopted by the Financial Accounting
Standards Board and its predecessors as generally accepted
accounting principles, and (b) such that a certified public
accountant would, insofar as the use of accounting principles is
pertinent, be in a position to deliver an unqualified opinion as
to financial statements in which such principles have been
properly applied.
"GCCTS" shall have the meaning set forth in Section 5.1(a).
"Governmental Authority" means any federal, state, local,
municipal, foreign or other government or any federal, state or
local regulatory authority.
"Governmental Permits" means all licenses, consents,
franchises, permits, privileges, immunities, approvals,
certificates and other authorizations from a Governmental
Authority to EPI or Buyer, as applicable.
"HSR Act" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976.
"Joint Venture" means a joint venture, partnership, limited
liability company or other similar arrangement, whether in
corporate, partnership or other legal form.
"Knowledge" means (a) with respect to an individual
"knowledge" of a particular fact or other matter if such
individual is aware or should reasonably be aware, after due
inquiry, of such fact or other matter; (b) with respect to a
Person (other than an individual) "knowledge" of a particular
fact or other matter if any individual who is serving as a
director or executive officer of such Person has "knowledge" of
such fact or other matter; and (c) with respect to the warranties
made by EPI and the Selling Shareholders that EPI and the Selling
Shareholders based upon a reasonable investigation, believes is
true.
"Liabilities" means damages, obligations, claims, demands,
judgments or settlements of any nature or kind, known or unknown,
fixed, accrued, absolute or contingent, liquidated or
unliquidated, including all costs and expenses (legal, accounting
or otherwise).
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"Liens" means any lien, pledge, hypothecation, charge,
mortgage, deed of trust, security interest or encumbrance against
any assets or properties.
"Material Adverse Effect" means any event or circumstance
which results in or is reasonably likely to result in a material
adverse change in (i) the financial condition, business,
operations, properties or prospects of the specified entity,
other than either general economic changes or regulatory or
competitive changes that affect their industry generally, over
which such entity has no control; (ii) the ability of such entity
to perform its obligations under this Agreement, or (iii) the
validity or enforceability of this Agreement.
"Order" means any order, judgment, injunction, or ruling
issued, made, entered or rendered by any court, administrative
agency or other Governmental Authority or by any arbitrator as to
which EPI or Buyer, is a party.
"Party" means EPI, Buyer or the Selling Shareholders as
applicable.
"Permitted Liens" means deposits under workmen's
compensation, unemployment insurance or social security laws, or
to secure statutory obligations or surety or similar bonds;
government charges or other governmental levies which are not yet
delinquent, or which are being contested in good faith by
appropriate proceedings with adequate reserves in conformity with
GAAP; statutory liens imposed by law incurred in the ordinary
course of business or for obligations not yet due to carriers,
warehousemen, laborers or materialmen; the interest or title of
any lessor and property pursuant to a lease of real property; and
other encumbrances other than those securing monetary obligations
that do not materially and adversely affect the use of property
as heretofore used in the ordinary course of business or
materially detract from the value thereof.
"Person" means any individual, corporation, partnership,
joint venture, estate, trust, cooperative, foundation, union,
syndicate, league, consortium, coalition, committee, society,
firm, company or other enterprise, association, organization or
other entity or Governmental Authority.
"Proceeding" means any suit, litigation, arbitration,
proceeding (including any civil, criminal, administrative,
investigative or appellate proceeding).
"Proxy Mailing Date" shall have the meaning set forth in
Section 6.6(b).
"Proxy Statement" shall have the meaning set forth in
Section 5.1(a).
"Representatives" shall have the meaning set forth in
Section 4.2.
"Subsidiary" means any entity in which EPI has the ability
to direct the management or affairs.
"Tax" or "Taxes" means any federal, state, local or foreign
income, sales, excise, real or personal property or other taxes,
assessments, fees, levies, duties, deductions or other charges of
any nature whatsoever (including, without limitation, interest
and penalties) imposed by any Applicable Law.
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"Transactions" means the (i) purchase and sale of the
Transferred Shares, (ii) purchase and sale of the Warrant Shares,
(iii) the Proposed Stock Split, (iv) the cancellation of shares
of EPI Preferred (v) distribution of shares of GCCTS and FZI, and
(vi) other transactions contemplated by this Agreement.
"TTI" shall have the meaning set forth in the Recitals.
9.2. DEFINED TERMS. In this Agreement, all definitions
shall be equally applicable to both the singular and the plural
forms.
ARTICLE 10. MISCELLANEOUS
10.1. EXPENSES OF THE TRANSACTION. Subject to Section 5.8,
each of EPI, TTI and the Selling Shareholders agrees to pay its
own fees and expenses in connection with this Agreement and the
transactions hereby contemplated, except as otherwise provided
herein.
10.2. FURTHER ASSURANCES. Each of EPI, TTI and the Selling
Shareholders agrees that it will, at any time and from time to
time after the Closing Date, upon the request of the other party,
do, execute, acknowledge and deliver, or will cause to be done,
executed, acknowledged and delivered, all such further acts,
assignments, transfers, conveyances, powers of attorney and
assurances as may be reasonably required from time to time in
order to effectuate the provisions and purposes of this
Agreement.
10.3. NOTICES. All notices or other communications required
or permitted hereunder shall be in writing and shall be deemed
given or delivered (a) when delivered personally or by private
courier, (b) when actually delivered by registered United States
mail, return receipt requested, or (c) when sent by telecopy
(provided, however, that, it is telephonically or electronically
confirmed), addressed as follows:
If to Buyer, to:
Terminator Technologies, Incorporated
0000 Xxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
If to EPI, to:
Environmental Plus, Incorporated
Xxxxx 0, Xxx 00
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxx Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
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With copy to:
Xxxxx & Xxxxxx LLP
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxx Held, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
If to Selling Shareholders, to:
X. X. Xxxxxxxxx
Xxxxxxx Xxxxx
Xxxxxx Xxxxx
c/o Environmental Plus, Incorporated
Xxxxx 0, Xxx 00
Xxxxxxx, Xxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
or such other address as such party may indicate by a notice
delivered to the other parties hereto in the manner herein
provided.
10.4. NO MODIFICATION EXCEPT IN WRITING. This Agreement
shall not be changed, modified, or amended except by a writing
signed by the party to be charged and this Agreement may not be
discharged except by performance in accordance with its terms or
by a writing signed by the party to which performance is to be
rendered.
10.5. ENTIRE AGREEMENT. This Agreement, together with the
Schedules and Exhibits hereto, sets forth the entire agreement
and understanding, and supersedes all prior agreements and
understandings, among the parties as to the subject matter
hereof.
10.6. SEVERABILITY. If any provision of this Agreement or
the application of any provision hereof to any person or in any
circumstances is held invalid, the remainder of this Agreement
and the application of such provision to other persons or
circumstances shall not be affected unless the provision held
invalid shall substantially impair the benefits of the remaining
portions of this Agreement.
10.7. ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and permitted assigns. This Agreement may not be
assigned by any party hereto except with the prior written
consent of the other parties. Any purported assignment contrary
to the terms of this Agreement shall be void.
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10.8. PUBLICITY; ANNOUNCEMENTS. Except to the extent
required by law, prior to the Closing Date, all publicity related
to the transactions contemplated hereby shall be subject to the
mutual approval of Buyer and EPI; provided, Buyer and EPI shall
be entitled to disclose the transactions contemplated hereby
without the prior approval of the other, but with prior notice to
the other, to the extent reasonably necessary for Buyer or EPI to
comply with applicable securities laws.
10.9. CHOICE OF LAW. This Agreement shall be deemed to have
been made in, and shall be construed in accordance with the laws
of the State of Texas, and its validity, construction,
interpretation and legal effect shall be governed by the laws of
the State of Texas applicable to contracts entered into and
performed entirely therein.
10.10. CAPTIONS; CONSTRUCTION. The captions appearing in
this Agreement are inserted only as a matter of convenience and
for reference and in no way define, limit or describe the scope
and intent of this Agreement or any of the provisions hereof. All
uses of the term "including" shall be construed as descriptive
and not a limitation of the item described. All words used herein
shall be construed to be of such gender as the circumstances
require.
[Remainder of page intentionally left blank]
-20-
IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement to be effective as of the day and year first above
written.
ENVIRONMENTAL PLUS, INCORPORATED
By: /s/ X. X. XXXXXXXXX
-------------------------------------
Name: X. X. Xxxxxxxxx
-----------------------------------
Title: President
----------------------------------
TERMINATOR TECHNOLOGIES, INCORPORATED
By: /s/
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
AMJ RESOURCES, INC.
By: /s/
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
SELLING SHAREHOLDERS:
--------------------
GD/JD, INC.
By: /s/ XXXXXX XXXXX
-------------------------------------
Name: Xxxxxx Xxxxx
-----------------------------------
Title: President
----------------------------------
NORTHPORT MANAGEMENT GROUP, INC.
By: /s/ X. X. Xxxxxxxxx
-------------------------------------
Name: X. X. Xxxxxxxxx
-----------------------------------
Title: President
----------------------------------
/s/ XXXXXX XXXXX
----------------------------------------
XXXXXX XXXXX
/s/ X. X. XXXXXXXXX
----------------------------------------
X. X. XXXXXXXXX
/s/ XXXXXXX XXXXX
----------------------------------------
XXXXXXX XXXXX
-21-
SCHEDULE A
------------
SCHEDULE OF TRANSFERRED SHARES
SHAREHOLDER
PROCEEDS TO BE
TRANSFERRED RECEIVED (AT
PRE-SPLIT SHARES $0.04445 PER
SELLING SHAREHOLDERS SHARES (POST-SPLIT SHARE)
------------------------- ---------- ------------- --------------
Xxxxxx Xxxxx 11,259,570 1,125,957 $ 50,048.79
X. X. Xxxxxxxxx / 9,542,470 954,247 42,416.27*
Northport Management
Group, Inc.
Xxxxxxx Xxxxx 2,480,780 248,078 11,027.07*
GD/JD, Inc. 340,000 34,000 1,511.30*
---------- ----------- --------------
TOTAL 23,622,820 2,362,282 $105,003.43
* Pursuant to a separate agreement among the Selling
Shareholders, Xxxxxx Xxxxx is to be paid all proceeds
payable with regard to the sale of the Transferred Shares
owned by him, Xxxxxxx Xxxxx and GD/JD, Inc., and $7,415.13
of the proceeds payable to X. X. Xxxxxxxxx / Northport
Management Group, Inc. with regard to the sale of the
Transferred Shares owned by them (representing a total
consideration to Xxxxxx Xxxxx of $70,002.29).
SCHEDULE 2.3
------------
ANTICIPATED STOCK OWNERSHIP OF EPI
----------------------------------
SHAREHOLDER GROUP NUMBER OF SHARES
(POST-SPLIT)
---------------------------------- -----------------
1. Publicly Held (free trading) 373,659
2. Buyer 2,362,282
3. Selling Shareholders 406,201
4. Baron / Chase 150,000
5. Xxxxxxx XxXxxxxx 7,168
6. X. Xxxxxx 28
7. Transferees from original 34 734,016
million
SCHEDULE 2.15
-------------
LIST OF DIRECTORS, OFFICERS AND EMPLOYEES
DIRECTORS OFFICERS / EMPLOYEES
---------- --------------------
X. X. Xxxxxxxxx X. X. Xxxxxxxxx
(President)
Xxxxxx Xxxxx Xxxxxx Xxxxx
(Secretary, Treasurer and
Chairman)
Xxxxxxx Xxxxx Xxxxxxx Xxxxx
(Vice President)
SCHEDULE 2.16
-------------
BANK ACCOUNTS
Account No. 0000000
First State Bank
X.X. Xxxxx 00
Xxxxxxx, Xxxxx 00000
Authorized Signatories:Xxxxxx Xxxxx and Xxxx Xxxxx
