EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT dated as of May 23, 2005, among XDOGS, INC.,
a Nevada Corporation ("Buyer") and Mid-Continents Investments, Inc. ("Seller"),
an Oklahoma Corporation.
W I T N E S S E T H:
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A. Seller owns an undivided eighty percent (80%) Net Revenue Interest in
certain oil and gas leasehold interests described with particularity in Exhibit
"A" (the "Leasehold"); and,
B. Buyer desires to acquire from Seller the Leasehold for which Buyer will
issue 85,000,000 common shares of stock of Buyer ("Acquired Common Shares") to
Seller; and,
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
REPRESENTATION AND WARRANTIES OF SELLER
Seller represents and warrant to Buyer that:
1.1 Seller's Organization, Good Standing and Authority. Seller is a corporation
duly organized and validly existing and in good standing under the laws of
the State of Oklahoma and is duly registered and authorized to conduct
business in the State of Kansas and has all necessary power to own all of
its properties and assets and to carry on its business as now being
conducted. At the Closing, Seller shall be in good standing as an Oklahoma
corporation, and shall deliver to Seller at the Closing a true and correct
copy of its Articles, certified by the Secretary of State of Oklahoma, and
its Bylaws, certified as a true and correct copy of same by the Secretary
of Seller.
1.2 Leasehold. At the date of this Agreement, except as described on Exhibit
"1.2" attached hereto, Seller owns the Leasehold subject to no security
interests, mortgage, pledge, lien, encumbrance, or charge, except for minor
imperfections of title and encumbrances, if any, which are not substantial
in amount, which do not materially detract from the marketability or the
value of the properties subject thereto, or which do not materially impair
the utilization thereof.
1.3 Leasehold Equipment. At the date of this Agreement, Seller owns all of the
personal property as described in Exhibit "1.3" (the "Leasehold Equipment")
subject to no security interests, mortgage, pledge, lien, encumbrance, or
charge, except for minor imperfections of title and encumbrances, if any,
which are not substantial in amount, which do not materially detract from
the marketability or the value of the properties subject thereto, or which
do not materially impair the utilization thereof.
1.4 Tax Matters. Except as disclosed on Exhibit "1.4" attached hereto, Seller
has filed all required tax returns. Seller has paid or set up an adequate
reserve in respect of all taxes for the periods covered by such returns.
1.5 No Conflict. To Seller's best knowledge and except as disclosed on Exhibit
"1.5" attached hereto, neither the execution by Seller of this Agreement,
the consummation by Seller of the transactions contemplated herein nor the
compliance by Seller with the provisions of this Agreement conflicts with
or results in a breach of any provisions of any applicable law, judgment,
order, writ, injunction, decree, rule, regulation or agreement to which
Seller is a party or by which Seller is bound, or constitutes a default
under any thereof.
1.6 Litigation and Proceedings. Except as disclosed on Exhibit "1.6" attached
hereto, there are no legal, administrative, arbitration, governmental, or
other proceedings, actions, suits, claims or investigations instituted or
pending or threatened to which Seller, or any of its directors, officers or
employees, is a party which relates to Seller or its properties and which
would have a material adverse effect upon the business, financial
condition, properties or prospects of the Seller.
1.7 Authorized and Effective Agreement. Seller has all requisite corporate
power and authority to enter into and to perform this Agreement. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement have been duly and validly
authorized by all necessary corporate action in respect thereof on the part
of Seller and its shareholders. This Agreement has been duly and validly
executed and delivered by Seller, but is subject to proxy and shareholder
approval.
1.8 No Breach. Neither the execution and delivery of this Agreement, nor
consummation of the transactions contemplated by this Agreement, nor
Seller's compliance herewith (i) does or will conflict with or result in a
breach of any provisions of the Articles or Bylaws of Seller, (ii) violate,
conflict with or result in a breach of any term, condition or provision of,
or constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or give rise to any right of
termination, cancellation or acceleration with respect to, or result in the
creation of any lien, charge or encumbrance upon any property or asset of
Seller pursuant to, any material note, bond, mortgage, indenture, deed of
trust, license, lease, agreement or other instrument or obligation to which
Seller is a party, or by which any of its properties or assets may be bound
or affected, or (iii) subject to receipt of all required governmental
approvals, violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Seller.
1.9 Consents and Approvals. No consents or approvals of or filings or
registrations with any governmental entity or with any third party are
necessary on the part of Seller in connection with the execution and
delivery of this Agreement and the consummation by Seller of the
transactions contemplated by this Agreement. Seller is not aware of any
reasons why all consents and approvals shall not be procured from all
regulatory agencies having jurisdiction over the transactions contemplated
by this Agreement as shall be necessary for consummation of the
transactions contemplated by this Agreement.
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1.10 Material Adverse Change. Except as disclosed on Exhibit "1.10", since
February 17, 2005, Seller has conducted its business in the ordinary and
usual course (excluding the incurring of expenses and the filing of
applications with governmental and regulatory authorities in connection
with this Agreement and the transactions contemplated by this Agreement),
and (ii) no event has occurred or circumstance arisen that, individually or
in the aggregate, is reasonably likely to have a material adverse effect on
Seller.
1.11 Compliance with Laws. Except as disclosed on Exhibit "1.11", Seller is not
in violation of its Articles or Bylaws, or of any applicable foreign,
federal, state or local law or ordinance or any order, rule or regulation
of any foreign, federal, state, local or other governmental agency or body,
or in default with respect to any order, writ, injunction or decree of any
court, or in default under any order, license, regulation or demand of any
governmental agency, any of which violations or defaults could reasonably
be expected to have a material adverse effect on the properties or
operation of Seller's business, and Seller has not received any notice or
communication from any foreign, federal, state or local governmental
authority asserting that Seller is in violation of any of the foregoing
which could reasonably be expected to have a material adverse effect on
Seller. Seller is not subject to any regulatory or supervisory cease and
desist order, stop order, agreement, written directive, understanding or
written commitment, and has not received any written communication
requesting that it enter into any of the foregoing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants that:
2.1 Buyer's Organization, Good Standing and Authority. As of the date of this
Agreement, Buyer is a corporation, duly incorporated, validly existing and
in good standing under the laws of the State of Nevada and is duly
registered and authorized to conduct business in the State of Kansas. Buyer
has all requisite and full corporate power and authority, and is duly
qualified, authorized, approved and licensed to own, lease, and operate its
properties and to carry on its business as it is presently being in each
jurisdiction in which its activities requires such licensing, approval or
qualification, except where the failure to be so licensed, qualified,
approved or in good standing would not have a material adverse effect on
Buyer. Buyer has previously delivered to the Seller true and complete
copies of its Articles of Incorporation ("Articles") and its Bylaws
together with all amendments thereto to date. At the Closing, Buyer shall
be in good standing as a Nevada corporation, and shall deliver to Seller at
the Closing a true and correct copy of its Articles, certified by the
Secretary of State of Nevada, and its Bylaws, certified as a true and
correct copy of same by the Secretary of Buyer.
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2.2 Buyer's Capital Structure. As of the date of this Agreement, the authorized
capital of Buyer consists of 200,000,000 shares of common stock, $0.01 par
value ("Buyer Common Shares"), and one hundred (100) shares of Class A
Convertible Preferred Stock, par value $0.01 per share ("Buyer Preferred
Shares"), convertible into an undiluted forty percent (40%) interest of
Buyer Common Shares. As of the date hereof, there are approximately
79,828,543 shares of Buyer Common Shares issued and outstanding together
with the one hundred (100) shares of Buyer Preferred Shares issued and
outstanding (collectively "Buyer Issued Equity"). All of the Buyer Issued
Equity is validly issued, fully paid and nonassessable and has been issued
in full compliance with all applicable U.S. federal and U.S. state
securities laws. The Buyer has no other securities of any kind, whether
debt, equity, derivative or hybrid, issued or outstanding, other than Buyer
Common Shares and the Buyer Preferred Shares as well as there are no
outstanding subscriptions, rights, preemptive rights, options, warrants,
convertible securities or other agreements or commitments which would
obligate the Buyer to issue or to transfer any additional shares of Buyer
Common Shares and Buyer Preferred Shares or any other securities of the
Buyer. Buyer Common Shares are listed for trading in the Over-the-Counter
Bulletin Board ("OTCBB"). The outstanding shares of Buyer Common Shares
have been registered under Section 12(g) of the Securities Exchange Act of
1934, as amended (the "1934 Act") and are listed for trading in the OTCBB.
2.3 Subsidiaries. Buyer does not own, nor does it have any right or obligation
to acquire, directly or indirectly, any interest or investment (whether
debt or equity) in any corporation, limited liability company, partnership,
joint venture, business or other entity of any kind whatsoever.
2.4 Financial Statements and Regulatory Reports.
(a) Buyer has previously delivered or made freely available to the Seller
the audited financial statements of Buyer (including statements of
financial condition and the related statements of operations,
stockholders' equity and changes in financial position) for the years
ended March 31, 2001, 2002 and 2003, (collectively, the "Buyer's
Financial Statements"). Buyer's Financial Statements have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, and present
fairly the financial condition and results of operations of Buyer. The
audits of the Buyer's Financial Statements have been conducted in all
material respects in accordance with generally accepted auditing
standards. The books and records of Buyer are being maintained in
material compliance with applicable legal and accounting requirements
and such books and records accurately reflect in all material respects
all dealings and transactions in respect of the business, assets,
liabilities and affairs of Buyer. Buyer has no material indebtedness,
obligation, or liability, known, contingent or otherwise, except those
reflected in Buyer's Financial Statements, and specifically listed on
Buyer's December 31, 2004, Form 10-QSB/A-2 attached hereto as Exhibit
"2.4" (listing of creditors' and amounts) and those subsequently
incurred in the ordinary course of business and which are not in the
aggregate material to the operations of Buyer.
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(b) Buyer shall deliver or make freely available to Seller any and all
financial and other reports provided to and correspondence with any
regulatory agency having jurisdiction over Buyer. The books of account
of Buyer fully and fairly reflect all of the material assets,
liabilities and transactions of Buyer required to be set forth therein
for regulatory purposes and under generally accepted accounting
principles and are correct and complete in all material respects. All
reports filed with any of Buyer's regulators have been properly
prepared in accordance with applicable regulations and are materially
correct and complete.
(c) Prior to this agreement Buyer made available all requested financial
information and Seller has had ample opportunity to investigate the
Buyer's financial affairs and has not relied on any statements made by
Buyer or its principals or agents, and has not relied on any papers or
documents furnished by Buyer, but has conducted its own independent
investigation, or had amply opportunity to do so.
2.5 Tax Matters.
(a) Buyer has not timely filed all foreign and provincial, U.S. federal,
state and local income, franchise, excise, real property, personal
property and other tax returns required by applicable law to be filed
by it (including without limitation, estimated tax returns, income tax
returns, information returns and withholding and employment tax
returns) and has not made timely payment of or, where payment is not
required to have been made, has not set up an adequate reserve or
accrual for the payment of, all taxes shown to be due and payable,
whether disputed or not, in respect of the periods covered by such
returns.
(b) Buyer has filed, its 2001, 2002 and 2003 tax returns.
(c) Other than otherwise disclosed, all foreign, federal, state and local
income, franchise, excise, real property, personal property and other
tax returns filed by the Buyer are complete and accurate in all
material respects. The foreign, federal, state and local income tax
returns of Buyer have been prepared substantially in compliance with
applicable tax laws, regulations and policies, and Buyer has not
received a notice of examination from the applicable tax authorities
regarding those returns. Buyer has no agreements in effect to extend
the period of limitations for the assessment or collection of any tax.
2.6 Properties. Except as disclosed on Exhibit "2.6" attached hereto, all
personal property (less than $2,000.00 value) owned or used by Buyer in its
business is in an adequate condition (ordinary wear and tear excepted) and
sufficient to carry on the Buyer's business consistent with its past
practice.
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2.7 Litigation and Proceedings. Except as set forth in Buyer's December 31,
2004, 10-QSB/A-2 attached hereto as Exhibit "2.7", there are no legal,
administrative, arbitration, governmental, or other proceedings, actions,
suits, claims or investigations instituted or pending or threatened to
which Buyer, or any of its directors, officers or employees, is a party
which relates to Buyer or its properties and which would have a material
adverse effect upon the business, financial condition, properties or
prospects of the Buyer. Buyer is not a party to any judgment, order, writ,
injunction or decree having a material adverse effect on Buyer, except as
disclosed in Buyer's December 31, 2004, 10-QSB/A attached hereto as Exhibit
"2.7". Buyer has not committed any act or omitted to perform any act
reasonably be expected to give rise to any material legal action or other
material proceeding before any court or administrative agency.
2.8 Authorized and Effective Agreement. Buyer has all requisite corporate power
and authority to enter into and to perform this Agreement. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated by this Agreement have been duly and validly authorized by all
necessary corporate action in respect thereof on the part of Buyer and its
shareholders. This Agreement has been duly and validly executed and
delivered by Buyer, but is subject to proxy and shareholder approval.
2.9 No Breach. Neither the execution and delivery of this Agreement, nor
consummation of the transactions contemplated by this Agreement, nor
Buyer's compliance herewith (i) does or will conflict with or result in a
breach of any provisions of the Articles or Bylaws of Buyer, (ii) violate,
conflict with or result in a breach of any term, condition or provision of,
or constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or give rise to any right of
termination, cancellation or acceleration with respect to, or result in the
creation of any lien, charge or encumbrance upon any property or asset of
Buyer pursuant to, any material note, bond, mortgage, indenture, deed of
trust, license, lease, agreement or other instrument or obligation to which
Buyer is a party, or by which any of its properties or assets may be bound
or affected, or (iii) subject to receipt of all required governmental
approvals, violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Buyer.
2.10 Consents and Approvals. Except as disclosed on Exhibit "2.10", no consents
or approvals of or filings or registrations with any governmental entity or
with any third party are necessary on the part of Buyer in connection with
the execution and delivery of this Agreement and the consummation by Buyer
of the transactions contemplated by this Agreement. Buyer is not aware of
any reasons why all consents and approvals shall not be procured from all
regulatory agencies having jurisdiction over the transactions contemplated
by this Agreement as shall be necessary for (a) consummation of the
transactions contemplated by this Agreement and (b) the continuation by
Buyer after the Closing Date of its business as carried on immediately
prior to the Closing Date, free of any conditions or requirements which, in
the reasonable opinion of the Buyer, could have a material adverse effect
on Buyer or the Seller , or materially impair the value of Buyer to the
Seller.
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2.11 Material Adverse Change. Since February 17, 2005, Buyer has conducted its
business in the ordinary and usual course (excluding the incurring of
expenses and the filing of applications with governmental and regulatory
authorities in connection with this Agreement and the transactions
contemplated by this Agreement), and (ii) no event has occurred or
circumstance arisen that, individually or in the aggregate, is reasonably
likely to have a material adverse effect on Buyer.
2.12 Compliance with Laws. Except as disclosed on Exhibit "2.12", Buyer is not
in violation of its Articles or Bylaws, or of any applicable foreign,
federal, state or local law or ordinance or any order, rule or regulation
of any foreign, federal, state, local or other governmental agency or body,
or in default with respect to any order, writ, injunction or decree of any
court, or in default under any order, license, regulation or demand of any
governmental agency, any of which violations or defaults could reasonably
be expected to have a material adverse effect on the properties or
operation of Buyer's business, and Buyer has not received any notice or
communication from any foreign, federal, state or local governmental
authority asserting that Buyer is in violation of any of the foregoing
which could reasonably be expected to have a material adverse effect on
Buyer. Buyer is not subject to any regulatory or supervisory cease and
desist order, stop order, agreement, written directive, understanding or
written commitment, and has not received any written communication
requesting that it enter into any of the foregoing.
2.13 Public Securities. Buyer is in compliance with all applicable laws and
regulations regarding the listing and trading of its securities on the
OTCBB and regarding its registration and reporting under the 1934 Act,
Buyer has not received any notice of any alleged violation of any law or
regulation regarding its registration and reporting obligations under the
1934 Act or with respect to its listing or trading on the OTCBB, nor to the
best of Buyer's knowledge have any such allegations been threatened.
ARTICLE III
CONDITIONS PRECEDENT TO CLOSING
3.1 Conditions Precedent to the Parties' Obligation to Close. The obligations
of the parties to close the transactions contemplated by this Agreement are
subject to the satisfaction on or before the Closing of all of the
conditions set forth below in this Article III. A party may waive any or
all of these conditions in whole or in part without any prior notice;
provided, however, that no such waiver of a condition shall constitute a
waiver by such party of any of its other rights and remedies, at law or in
equity, if any of the other parties to this Agreement shall be in default
of any of their respective representations, warranties or covenants under
this Agreement.
(a) All corporate action necessary to authorize the execution and delivery
of this Agreement and consummation of the transactions contemplated by
this Agreement shall have been duly and validly taken by Buyer and
Seller, including, but not limited to, approval of the Agreement by
the requisite vote of the shareholders of Buyer of this Agreement.
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(b) All approvals and consents for the transactions contemplated in this
Agreement which are required for Seller's purchase of the Acquired
Common Shares and the other transactions contemplated by this
Agreement shall have been received and all statutory waiting periods
in respect thereof shall have expired; and Buyer and Seller shall have
procured all other approvals, consents and waivers of each person
(other than the governmental entities referred to above), if any,
whose approval, consent or waiver is necessary to the consummation of
the purchase of the Acquired Common Shares.
(c) Neither Buyer nor Seller shall be subject to any statute, rule,
regulation, injunction or other order or decree which shall have been
enacted, entered, promulgated or enforced by any governmental or
judicial authority which prohibits, restricts or makes illegal
consummation of any of the transactions contemplated by this
Agreement.
(d) Buyer and Seller have completed their respective due diligence
investigation of one another to their mutual satisfaction as permitted
under this Agreement.
3.2 Conditions Precedent to the Obligations of Seller to Close. The obligations
of Seller to close this Agreement are subject to the satisfaction on or
before the Closing of all of the conditions set forth below in this Article
3.2. Seller may waive any or all of these conditions in whole or in part
without any prior notice; provided, however, that no such waiver of a
condition shall constitute a waiver by such party of any of its other
rights and remedies, at law or in equity, if Buyer shall be in default of
any of its representations, warranties or covenants under this Agreement.
(a) The representations and warranties of Buyer as set forth this
Agreement shall be true and correct as of the date of this Agreement
and as of the Closing Date as though made on and as of the Closing
Date (or on the date when made in the case of any representation and
warranty which specifically relates to an earlier date).
(b) Buyer and Seller shall have performed in all material respects all
their respective obligations, satisfied all conditions precedent and
complied with all covenants required to be performed, satisfied or
complied with by each of them, respectively, pursuant to this
Agreement on or prior to the Closing Date.
(c) Buyer shall have delivered to Seller a certificate, dated the date of
the Closing and signed by Buyer's President to the effect that the
conditions set forth in to Closing have been satisfied, and that all
of Buyer's representations and warranties are true and correct as of
the Closing Date.
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(d) Buyer shall have furnished Seller with such certificates of its
officers and such other documents to evidence fulfillment of the
conditions set forth in this Agreement as such conditions relate to
the Buyer as Seller may reasonably request, in accordance with typical
practice in the Closing of such transactions.
ARTICLE IV
TERMS OF THE TRANSACTION
4.1 The Transaction. The sale by Seller of the Leasehold for the Acquired
Common Shares shall be made on the Closing Date (as defined in Article V)
and shall be based on the respective representations, warranties and
agreements of Seller and Buyer, and shall be subject to the terms and
conditions herein stated.
4.2 The Leasehold and the Acquired Common Shares. Buyer shall, at the Closing
deliver to Seller One Hundred Million (100,000,000) Common Shares for the
transfer and delivery by Seller to Buyer of the Leasehold.
4.3 Employment Agreement. Seller agrees and acknowledges that Buyer and Xxxx
Xxxxxxxxx will enter into an employment agreement, commencing on date of
Closing, consisting the following terms: naming Xxxx Xxxxxxxxx as
President/CEO until May 31, 2005, thereafter Consultant to Buyer and ending
on July 25, 2005, a salary equal to $5,000.00 per month which Buyer may
accrue if the Buyer is unable to pay the salary, provided that the salary
shall be paid in full by the termination of the employment agreement on
July 25, 2005, along with business related expenses reimbursed with prior
approval of Seller, including travel and lodging to Tulsa, Oklahoma.
4.4 Material Changes to Capital Structure. Buyer and Seller agree not to make
any material changes in the debt or equity structure of Buyer for a period
of twelve (12) months after the Closing Date without the written approval
of Xxxx Xxxxxxxxx.
4.5 Indemnification. Seller hereby agrees to indemnify, defend and hold
harmless Buyer and Xxxx Xxxxxxxxx from and against all demands, claims,
actions, causes of action, assessments, losses, damages, liabilities, costs
and expenses, including without limitation, interest, penalties and
reasonable attorney fees and expenses, asserted against, resulting to, and
imposed upon or incurred by Buyer or Xxxx Xxxxxxxxx caused by (a)
liabilities and obligations of, and claims against Buyer or Xxxx Xxxxxxxxx
(including but not limited to the payment of taxes, assessment, stock
issuances, existing debt or services payable either in the form of stock or
cash and the like) existing as of the Closing Date or arising out of facts
or circumstances existing on or prior thereto, which Buyer has disclosed to
Seller, or (b) a material breach of any agreement, covenant, representation
or warranty of any Seller. Seller hereby agrees to reimburse Buyer should
Buyer pay any such demands, claims, actions, causes of action, assessments,
losses, damages, liabilities, costs and expenses, including without
limitation, interest, penalties and reasonable attorney fees and expenses.
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Buyer acknowledges that it is not current on is taxes (Federal, State and
Payroll). Seller shall assume the Tax Liability of the Buyer
ARTICLE V
CLOSING
5.1 Closing. The Closing of the transactions contemplated hereby shall be held
at 11:00 A.M., on May 11, 2005, at the offices of Xxxxx, Xxxxx Law Firm,
000 Xxxx Xxxxx Xxxxxx, Xxxxx, XX 00000, or at such other place as the
parties may agree upon. The time and date of Closing is herein called the
"Closing Date."
ARTICLE VI
ACCESS TO INFORMATION AND DOCUMENTS
6.1 Access to Information. Seller will, or will cause Seller to, give to Buyer
and its counsel, accountants, engineers and other representatives full
access during normal business hours to all the properties, documents,
contracts and records of Seller and furnish Buyer with copies of such
documents (certified if so requested) and with such information with
respect to the affairs of Seller as Buyer may from time to time reasonably
request.
ARTICLE VII
COVENANTS OF SELLER
7.1 Encumbrances. Prior to the Closing Date, Seller will not incur or suffer to
exist any lien, charge or encumbrance on the Leasehold other than as
provided in this Agreement.
7.2 Preservation of Business. Seller will use its best efforts to preserve and
keep the business organization of Buyer intact, to keep available to Buyer
the services of the present officers and employees of Seller, and to
preserve for Buyer and Seller the good will of the suppliers, customers and
others having business relations with Seller.
7.3 Consent. Prior to the Closing Date, Seller will not, without first
obtaining the written consent of Buyer:
(a) Encumber any asset or enter into any transaction or make any contract
or commitment relating to the Leasehold, assets and business otherwise
than in the ordinary course of business.
(b) Enter into any employment contract, which is not terminable upon
notice of 30 days or less at will without penalty to Seller.
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(c) Enter into any contract or agreement (i) which cannot be performed
within three (3) months or less, or (ii) which involves the
expenditure of over Ten Thousand Dollars ($10,000.00).
7.4 Records. Seller will cooperate with Buyer in delivering to Buyer all
records, formulas, know-how, technical data, secrets and other methods and
processes used by Seller in its business, and will cooperate with Buyer in
connection therewith after the Closing Date in such manner as may
reasonably be required by Buyer.
ARTICLE VIII
TERMINATION OF AGREEMENT
8.1 Termination. This Agreement and the transactions contemplated hereby may be
terminated or abandoned at any time prior to the Closing Date:
(a) By mutual consent of the Seller and Buyer;
(b) By Buyer, if there has been a material misrepresentation in this
Agreement by Seller, or a material breach by Seller of any of the
warranties or covenants of Seller set forth herein, or a failure of
any condition to which the obligations of Buyer are subject;
(c) By Seller, if there has been a material misrepresentation in this
Agreement by Buyer, or a material breach by Buyer of any of the
warranties or covenants of Buyer set forth herein, or a failure of any
condition to which the obligations of Seller are subject; or
(d) By Seller or Buyer if the Closing Date shall not have occurred on or
prior to May 6, 2005, for any reason.
ARTICLE IX
CONDITIONS TO CLOSING OF BUYER
The obligation of Buyer to purchase the Leasehold for the Acquired Common
Shares pursuant to this Agreement shall be subject to the satisfaction, at or
prior to the Closing Date, of the following conditions (any of which may be
waived by Seller):
9.1 Performance. Each of the agreements of Seller to be performed at or prior
to the Closing Date pursuant to the terms hereof shall have been duly
performed.
9.2 Disclosure of Documents. Seller shall have furnished Buyer with copies of
the following documents relating to Seller:
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(a) The certificate of incorporation and all amendments thereto of Seller,
duly certified by the appropriate official of the jurisdiction in
which Seller is incorporated.
(b) Certificates, executed by the proper official of each jurisdiction, as
to the good standing and qualification to do business of Seller in the
jurisdiction of its incorporation and in each other jurisdiction in
which it is required to qualify to do business as a foreign
corporation.
9.3. Opinion of Counsel of Seller. Seller's counsel shall have furnished Buyer
with a favorable opinion, dated the Closing Date, in form and substance
satisfactory to Buyer and its counsel, to the effect that:
(a) Seller is a corporation duly organized, validly existing and in good
standing under the laws of the State of Oklahoma is duly qualified to
do business as a foreign corporation wherever required to be so
qualified.
(b) The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not, violate
the Certificate of Incorporation or By-Laws of Seller or the
provisions of any mortgage, lien, lease, agreement, instrument, order,
arbitration award, judgment or decree of which such counsel has
knowledge, to which Seller is a party or by which it is bound, or
violate any other restriction of any kind or character to which the
Buyer is subject of which such counsel has knowledge.
(c) Seller has good and marketable title to the Leasehold and it is not
subject to any mortgage, pledge, lien, conditional sale agreement,
encumbrance or charge.
(d) Such counsel has no knowledge of, and does not have any reasonable
grounds to know of, any litigation, proceeding or governmental
investigation pending or threatened against or relating to Seller, its
properties or business, or the transactions contemplated by this
Agreement or any legal impediment to the continued operation and use
by Seller in the ordinary course of business of its properties and
assets.
(e) Each such opinion shall also cover such other matters incident to the
transactions contemplated hereby as Buyer or its counsel may
reasonably request. In rendering its opinion, such counsel may rely
upon title certificates, abstracts or policies and certificates of
public officials and of officers of Seller as to factual matters not
independently established by such counsel; provided that the extent of
such reliance is specified in such opinion and that copies of such
documents so relied upon are delivered to Buyers, as the case may
warrant.
9.4 Survival of Representations and Warranties. The representations and
warranties of Seller contained in this Agreement (including the Exhibits
hereto) or in any certificate or document delivered to Buyer pursuant
hereto, shall be deemed to have been made again at the Closing Date and
shall then be true in all material respects; Seller shall have performed
and complied with all agreements and conditions required by this Agreement
to be performed or complied with by Seller prior to or at the Closing Date;
and Buyer shall have been furnished with certificates of Seller and of
appropriate officers of Seller, dated the Closing Date, certifying in such
detail as Buyer may reasonably request to the fulfillment of the foregoing
conditions.
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9.5 Investment Agreement. Seller shall have executed and delivered to Buyer an
investment agreement, upon the terms set forth in the form of such
agreement attached hereto as Exhibit "9.5", providing, in effect, that
Seller has acquired the Acquired Common Shares for investment and not with
a view to the public distribution thereof.
ARTICLE X
CONDITIONS TO CLOSING OF SELLER
The obligation of Seller to sell the Leasehold for the Acquired Common
Shares pursuant to this Agreement shall be subject to the satisfaction, at or
prior to the Closing Date, of the following conditions (any of which may be
waived by Seller):
10.1 Performance. Each of the agreements of Buyer to be performed at or prior to
the Closing Date pursuant to the terms hereof shall have been duly
performed.
10.2 Disclosure Documents. Buyer shall have delivered to Seller a certificate or
certificates for the Acquired Common Shares required to be delivered to
Seller under Article 3.1, in each case duly registered in the name of
Seller.
10.3 Opinion of Legal Counsel of Buyer. Buyer shall have furnished Seller with a
favorable opinion, dated the Closing Date, from counsel for Buyer, in form
and substance satisfactory to Seller and their counsel, to the effect that:
(a) Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada.
(b) Buyer has corporate power to execute, deliver and perform this
Agreement, and has taken all action required by law, its Certificate
of Incorporation, its By-Laws or otherwise, to authorize such
execution, delivery and performance.
(c) This Agreement constitutes the valid and legally binding agreement of
Buyer in accordance with its terms.
(d) Buyer has taken all necessary corporate action to issue Acquired
Common Shares to Seller, and upon such issuance to Seller, Acquired
Common Shares will have been duly authorized and issued, fully paid
and nonassessable.
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(e) Such opinion shall also cover such other matters incident to the
transactions contemplated hereby as Seller or their counsel may
reasonably request. In rendering their opinion, such counsel may rely
upon certificates of public officials and of officers of Buyer as to
matters of fact, provided that the extent of such reliance is
specified in such opinion or opinions and that copies of such
documents relied upon are delivered to Seller.
(f) All legal matters shall have been approved by counsel for Buyer, and
the Seller shall have received from such counsel an opinion, dated the
Closing Date, satisfactory to Seller, relating to legal matters in
connection with the transaction contemplated hereby.
10.4 Survival of Representations and Warranties. The representations and
warranties of Buyer contained in this Agreement or in any certificate or
document delivered to Seller pursuant hereto shall be deemed to have been
made again at the Closing Date and shall then be true in all material
respects; Buyer shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with by
Buyer prior to or at the Closing Date; and Seller shall have been furnished
with certificates of appropriate officers of Buyer, dated the Closing Date,
certifying in such detail as Seller may reasonably request, to the
fulfillment of the foregoing conditions.
ARTICLE XI
MISCELLANEOUS
11.1 Survival of Representations and Warranties. The representations and
warranties made in this Agreement and in any certificate, exhibit or
document delivered in connection therewith shall survive the Closing Date
any investigations made and the delivery or all required instruments and
documents hereunder. The absence of specific survival language after any
specific provision set forth in the representations, warranties or
obligations shall not be deemed or construed to mean that such
representations, warranties or obligations do not survive.
11.2 Indemnification. The Buyer hereby agrees to indemnify, defend and hold
harmless the Seller from and against all demands, claims, actions, causes
of action, assessments, losses, damages, liabilities, costs and expenses,
including without limitation, interest, penalties and reasonable attorney
fees and expenses, asserted against, resulting to, and imposed upon or
incurred by Seller caused by (a) liabilities and obligations of, and claims
against, Buyer (including but not limited to the payment of taxes,
assessment, stock issuances, existing debt or services payable either in
the form of stock or cash and the like) existing as of the Closing Date or
arising out of facts or circumstances existing on or prior thereto, known
and unknown to the Buyer as of the Closing Date, and not disclosed to or
known by Seller, prior to the Closing, or (b) a material breach of any
agreement, covenant, representation or warranty of any Buyer. The Buyer's
obligation under this paragraph shall survive the Closing of the
transaction contemplated hereunder and the delivery of all required
instruments and documents hereunder.
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11.3 Brokerage Fees. Buyer and Seller represent and warrant that there are no
claims for brokerage commissions or finder's fees in connection with the
transactions contemplated hereby resulting from any action taken by Seller,
by Buyer, by the officers and directors of Seller or Buyer, or by any of
them.
11.4 Choice of Law. This Agreement shall be construed and enforced in accordance
with the internal law of the State of Oklahoma.
11.5 Arbitration. At the option of either party, any dispute between the parties
shall be determined by arbitration administered by the National Arbitration
Association under its commercial rules.
11.6 Registration Statement. Buyer and Seller agree not to do a consolidation,
reverse split, or an offering of shares subject to Rule S-8 for a period of
twelve (12) months after the Closing Date, without the written approval of
Xxxx Xxxxxxxxx.
11.7 Notices. All notices, consents, requests, instructions, approvals and other
communications provided for herein shall be validly given, made or served
if in writing and delivered personally, or sent by certified mail, postage
prepaid, or by telegraph, charges prepaid, if to Buyer, addressed to:
XDOGS, Inc.
7000 Flour Exchange Building
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
If to Seller, addressed to:
Mid-Continent Investments Corporation
0000 Xxxx 00xx Xxxxxx
Xxxxx, XX 00000.
11.9 Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns,
and no other person shall acquire or have any right under or by virtue of
this Agreement.
11.10 Counterparts. This Agreement may be executed in one or more counterparts,
and shall become effective when one or more counterparts have been signed
by each of the parties.
11.11 Disclosure Supplements. From time to time prior to the Closing Date, each
party shall promptly supplement or amend any materials previously disclosed
and delivered to the other party pursuant to this Agreement with respect to
any matter arising after the execution of this Agreement which, if
existing, occurring or known at the date of this Agreement, would have been
required to be set forth or described in materials previously disclosed to
the other party or which is necessary to correct any information in such
materials which has been rendered materially inaccurate thereby; no such
supplement or amendment to such materials shall be deemed to have modified
the representations, warranties and covenants of the parties for the
purpose of determining whether the conditions set forth below have been
satisfied.
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IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto
as on the day and year first above written.
"BUYER" "Seller"
XDOGS, INC. Mid-Continents Investments, Inc.
a Nevada corporation
By: / s / Xxxx X. Xxxxxxxxx By: / s / Xxxxxx Xxxxxxxx
------------------------------- -------------------------
Xxxx X. Xxxxxxxxx Xxxxxx Xxxxxxxx
Its: Chief Executive Officer Its: President
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