INTEREST PURCHASE AGREEMENT BETWEEN WPCS INTERNATIONAL INCORPORATED, AMERICAN GAS SERVICES, INC. AND AMERICAN GAS SERVICES, INC. CONSULTANTS Dated as of April 5, 2007
Exhibit
10.1
BETWEEN
WPCS
INTERNATIONAL INCORPORATED,
AMERICAN
GAS SERVICES, INC.
AND
AMERICAN
GAS SERVICES, INC. CONSULTANTS
Dated
as
of April 5, 2007
INTEREST
PURCHASE AGREEMENT, dated as of April 5, 2007 (the “Agreement”), between WPCS
International Incorporated, a corporation existing under the laws of Delaware
(the “Purchaser”), American Gas Services, Inc., a corporation existing under the
laws of Minnesota (“AGS”), and American Gas Services, Inc. Consultants, a
corporation existing under the laws of Florida (“AGS Consultants,” together with
AGS, the “Sellers”).
WHEREAS,
AGS is a wholly-owned subsidiary of AGS Consultants;
WHEREAS,
AGS owns a 60% joint venture interest (the “Equity Interest”) in Taian AGS
Pipeline Construction Co. Ltd., a joint venture enterprise in the City of Taian,
Shandong province, the People's Republic of China (the “Company”);
WHEREAS,
AGS Consultants owns a 60% profit interest (the “Profits Interest,” together
with the Equity Interest, the “Interest”) in the Company;
WHEREAS,
AGS and AGS Consultants desire to sell to Purchaser and the Purchaser desires
to
purchase from AGS the Equity Interest and from AGS Consultants the Profits
Interest, for the purchase price and upon the terms and conditions hereinafter
set forth;
WHEREAS,
the Company specializes in the construction of pipelines for coal gas, natural
gas, propane, water, sewer construction projects and consulting work of
technical nature, post-construction services and other operations currently
held
in its license (the “Business”).
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter contained, the parties hereby agree as
follows:
ARTICLE
I
SALE
AND
PURCHASE OF THE INTERESTS
1.1 Sale
and Purchase of the Interests. Upon
the
terms and subject to the conditions contained herein, on the Closing Date AGS
and AGS Consultants shall sell, assign, transfer, convey and deliver to the
Purchaser, and the Purchaser shall purchase the Equity Interest from AGS and
the
Profits Interest from AGS Consultants (collectively, the
"Transaction").
ARTICLE
II
PURCHASE
PRICE AND PAYMENT
2.1 Amount
of Purchase Price. The
purchase price for the Interest shall be an amount equal to $1,600,000 (the
“Purchase Price”),
subject to adjustment as set forth herein.
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2.2 Payment
of Purchase Price. On
the
Closing Date, the Purchaser shall pay the Purchase Price to AGS as
follows:
(a) $800,000
(the “Cash Purchase Price”) which
shall be paid by
wire
transfer of immediately available funds into an account designated by AGS
Consultants; and
(b) issuance
of such number of shares of Purchaser common stock (the “Common Stock”) as
equals $800,000, divided by the closing price of the Common Stock on the date
which is one day prior to the Closing Date (the “AGS Shares”). The AGS Shares
shall be issued in the name of AGS Consultants and delivered within three (3)
business days of the Closing Date.
2.3 Purchase
Price Adjustment.
Notwithstanding the foregoing, the Purchase Price shall be adjusted by an amount
equal to 60% of the difference between (a) the net tangible asset value of
the
Company as of the Closing Date, and (b) $3,300,000. Net tangible asset value
is
defined as total assets minus total liabilities minus intangible assets,
calculated in accordance with Generally Accepted Accounting Principles (“NTAV”).
Any shortfall from the $3,300,000 shall proportionately reduce the cash and
stock components of the Purchase Price. An amount equal to 10% of the Purchase
Price (cash and AGS Shares in equal value) shall be held in escrow pending
determination of the NTAV of the Company as of the Closing Date, which shall
be
calculated within 90 days of the Closing Date as set forth below and distributed
within five days after the date of such determination.
(a) Not
later
than 60 days following the Closing Date, the Purchaser shall prepare and deliver
to the Sellers the NTAV calculation (the “NTAV Calculation”). Sellers shall have
30 days following the delivery of the NTAV Calculation (the “Review Period”) to
review the NTAV Calculation. The NTAV Calculation shall be conclusive and
binding upon the parties unless, within 10 days following the expiration of
the
Review Period, Sellers notify the Purchaser in writing (the “Objection Notice”)
that the Sellers dispute any of the amounts set forth therein. The Objection
Notice shall identify each item of the NTAV Calculation to which the Sellers
object and describe the nature of such objection and the Sellers' calculation
of
such disputed item. (i) If the Sellers do not deliver an Objection Notice to
Purchaser within the Review Period or (ii) following delivery of any Objection
Notice to Purchaser on a timely basis in respect of which the parties achieve
resolution of any disputes set forth therein within the time period set forth
in
subsection (b) below, the NTAV Calculation (as amended to the extent necessary
to reflect the resolution of such disputes), shall be conclusive and binding
on
the parties.
(b) If
the
Sellers deliver an Objection Notice to Purchaser, Purchaser and the Sellers
shall during the 20 day period following receipt of such Objection Notice use
commercially reasonable efforts to negotiate in good faith and reach agreement
on each item of the NTAV Calculation disputed pursuant to the Objection Notice.
If during such period, Purchaser and the Sellers are unable to reach agreement,
they shall immediately refer any such unresolved items to an unrelated certified
public accountant chosen mutually by the Purchaser and the Sellers (the
“Unrelated Accountant”) for resolution in accordance with this subsection (any
such referred item, a “Disputed Item”). Promptly, but no later than 20 days
after acceptance of his or her appointment as Unrelated Accountant, the
Unrelated Accountant shall determine those
Disputed Items and shall render a written report
3
as
to the
resolution of the Disputed Items and the resulting computation of the final
Purchase Price, which computation shall be conclusive and binding on the
parties. In the course of the Unrelated Accountant’s review, the parties may
deliver written submissions to the Unrelated Accountant describing their
respective positions. In resolving any Disputed Item, the Unrelated Accountant
shall be bound by the provisions of this Section 2.3. Upon receipt of the
Unrelated Accountant’s written report, the NTAV Calculation, as modified to
reflect the Unrelated Accountant’s determinations, shall be deemed accepted by,
and such determinations shall be final and binding on, the Sellers and Purchaser
and enforceable as an arbitration award pursuant to the Federal Arbitration
Act,
9 U.S.C. § 1-16. The Unrelated Accountant’s fees and expenses shall be borne by
Purchaser and the Sellers in such proportion as the Unrelated Accountant
may
determine and, in the absence of such determination,
equally.
ARTICLE
III
CLOSING
3.1 Closing
Date. The
closing of the sale and purchase of the Interests provided for in Section 1.1
hereof (the “Closing”) shall take place at the offices of Sichenzia ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP located at ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (or at
such other place as the parties may designate in writing) on such other date
as
the Sellers and the Purchaser may designate in writing. The date on which the
Closing shall be held is referred to in this Agreement as the “Closing
Date”.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF THE SELLERS
The
Sellers hereby represents and warrants to the Purchaser that:
4.1 Organization
and Good Standing of the Sellers.
AGS is
a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation as set forth above. AGS
Consultants is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation as set forth
above.
4.2 Authority.
(a) The
execution of this Agreement and the delivery hereof to the Purchaser and the
sale contemplated herein have been, or will be prior to Closing, duly authorized
by each Sellers’ Board of Directors.
(b) Subject
to any consents required under Section 4.6 below, the Sellers have the full
legal right, power and authority to execute, deliver and carry out the terms
and
provisions of this Agreement; and this Agreement has been duly and validly
executed and delivered on behalf of the Sellers and constitutes a valid and
binding obligation of the Sellers enforceable in accordance with its
terms, except
to
the extent that enforceability may be limited by bankruptcy, insolvency and
other similar laws affecting the enforcement of creditor’s rights generally and
general equity principles.
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(c) Neither
the execution and delivery of this Agreement, the consummation of the
transactions herein contemplated, nor compliance with the terms of this
Agreement will violate, conflict with, result in a breach of, or constitute
a
default under any statute, regulation, indenture, mortgage, loan agreement,
or
other agreement or instrument to which either of the Sellers is a party or
by
which either is bound, any charter, regulation, or bylaw provision of the
Sellers, or any decree, order, or rule of any court or governmental authority
or
arbitrator that is binding on either of the Sellers in any way.
4.3 The
Interest.
The
Sellers are the lawful record and beneficial owner of the Interests, free and
clear of any liens, pledges, encumbrances, charges, claims or restrictions
of
any kind, and has, or will have on the Closing Date, the absolute, unilateral
right, power, authority and capacity to enter into and perform this Agreement
without any other or further authorization, action or proceeding, except as
specified herein. Upon the delivery to Purchaser on the Closing Date of the
Interests, Purchaser will have good, legal, valid, marketable and indefeasible
title to a 60% interest in the Company, free and clear of any liens, pledges,
encumbrances, charges, agreements, options, claims or other arrangements or
restrictions of any kind.
4.4. Minute
Books.
The
minute books of the Sellers, which shall be exhibited to the Purchaser between
the date hereof and the Closing Date, each contain true, correct and complete
minutes and records of all meetings, proceedings and other actions of the
shareholders, Boards of Directors and committees of such Boards of Directors
of
each such corporation, if any, and, on the Closing Date, will contain true,
correct and complete minutes and records of any meetings, proceedings and other
actions of the shareholders, respective Boards of Directors and committees
of
such Boards of Directors of each such corporation.
4.5. Subsidiaries
and Affiliates.
The
Company does not have any subsidiaries.
4.6. Consents.
Except
as set forth in Schedule 4.6, no consents or approvals of any public body or
authority and no consents or waivers from other parties to leases, licenses,
franchises, permits, indentures, agreements or other instruments are required
for the lawful consummation of the transactions contemplated hereby, nor will
the consummation of the transactions contemplated hereby result in creating,
accelerating or increasing any liability of the Company.
4.7 Machinery
and Equipment.
Except
for items disposed of in the ordinary course of business, all machinery, tools,
furniture, fixtures, equipment, vehicles, leasehold improvements and all other
tangible personal property (hereinafter “Fixed Assets”) of the Company currently
being used in the conduct of its business, together with any machinery or
equipment that is leased or operated by the Company, are in fully serviceable
working condition and repair (reasonable wear and tear excepted). All Fixed
Assets owned, used or held by the Company are currently used in its business.
All Fixed Assets used by the Company are set forth on Schedule 4.7
hereto.
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4.8 Real
Property Matters.
The
Company does not own any real property as of the date hereof and has not owned
any real property during the three years preceding the date hereof, except
as
set forth on Schedule 4.8. To the knowledge of the Sellers, the real property
and improvements thereon owned by the Company do not violate or contravene
any
planning or zoning ordinance or other administrative regulations or any
restrictive covenant or any provision of local law in effect or any other law,
ordinance, executive order or judicial decree, whether pertaining to pollution
of the earth, water, atmosphere or otherwise, that in any material respect
interferes with or prevents the continued use of such properties for the
purposes for which they are now being used or which would materially affect
the
value thereof or the ability to transfer the same under state or federal laws
or
regulations.
4.9 Leases.
All
leases of real and personal property of the Company are described in Schedule
4.9 and to the knowledge of the Sellers, are in full force and effect and
constitute legal, valid and binding obligations of the respective parties
thereto enforceable in accordance with their terms, except as limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to
or affecting generally the enforcement of creditor’s rights, and have not been
assigned or encumbered. To the knowledge of the Sellers, the Company has
performed in all material respects the obligations required to be performed
by
it under all such leases to date and it is not in default in any material
respect under any of said leases, except as set forth in Schedule 4.9, nor
has
it made any leasehold improvements required to be removed at the termination
of
any lease, except signs. No other party to any such lease, to the knowledge
of
the Sellers, is in material default thereunder. Except as noted on Schedule
4.9,
none of the leases listed thereon require the consent of a third party in
connection with the transfer of the Interest.
4.10 Patents,
Software, Trademarks, Etc.
The
Company does not own or possess adequate licenses or other rights in patents,
software, trademarks, service marks, trade names and copyrights, except for
its
name as listed on Schedule 4.10.
4.11. Lists
of Contracts, Etc.
There is
included in Schedule 4.11 a list of the following items (whether written or
oral) relating to the Company:
(i) All
joint
venture contracts of the Company or affiliates relating to the
Business;
(ii) All
contracts of the Company relating to (a) obligations for borrowed money,
(b) obligations evidenced by bonds, debentures, notes or other similar
instruments, (c) obligations to pay the deferred purchase price of property
or services, except trade accounts payable arising in the ordinary course of
business, (d) obligations under capital leases, (e) debt of others
secured by a lien on any asset of the Company, and (f) debts of others
guaranteed by the Company.
Except
as
set forth in Schedule 4.11, (i) to the knowledge of the Sellers, all
contracts, agreements and commitments of the Company set forth in Schedule
4.11
are valid, binding and in full force and effect, and (ii) neither the
Company nor, to the knowledge of the Sellers, any other party to any such
contract, agreement, or commitment has materially breached any provision thereof
or is in default thereunder.
6
To
the
knowledge of Sellers, there has not been any event, happening, threat or fact
that would lead them to believe that any of said customers or vendors will
terminate or materially alter their business relationship with the Company
after
completion of the transactions contemplated by this Agreement.
4.12 Banking
and Personnel Lists.
The
Sellers will deliver to the Purchaser prior to the Closing Date the following
accurate lists and summary descriptions relating to the Company:
(a) The
name
of each bank in which the Company has an account or safe deposit box and the
names of all persons authorized to draw thereon or have access
thereto.
(b) The
names, current annual salary rates and total compensation for the preceding
fiscal year of all of the present directors and officers of the Company, and
any
other employees whose current base accrual salary or annualized hourly rate
equivalent is $20,000 or more, together with a summary of the bonuses,
percentage compensation and other like benefits, if any, paid or payable to
such
persons for the last full fiscal year completed, together with a schedule of
changes since that date, if any.
4.13 Compliance
With the Law.
The
Company is not in violation of the Foreign Corrupt Practices Act. To the
knowledge of the Sellers, the Company is not in violation of any applicable
federal, state, local or foreign law, regulation or order or any other, decree
or requirement of any governmental, regulatory or administrative agency or
authority or court or other tribunal (including, but not limited to, any law,
regulation order or requirement relating to securities, properties, business,
products, manufacturing processes, advertising, sales or employment practices,
terms and conditions of employment, occupational safety, health and welfare,
conditions of occupied premises, product safety and liability, civil rights,
or
environmental protection, including, but not limited to, those related to waste
management, air pollution control, waste water treatment or noise abatement).
Except as set forth in Schedule 4.13, the Company has not been and is not now
charged with, or to the knowledge of the Sellers, under investigation with
respect to, any violation of any applicable law, regulation, order or
requirement relating to any of the foregoing, nor, to the knowledge of the
Sellers, are there any circumstances that would or might give rise to any such
violation. To the knowledge of the Sellers, the Company has filed all reports
required to be filed with any governmental, regulatory or administrative agency
or authority.
4.14 Litigation.
Except
as specifically identified on Schedule 4.14:
(a) There
are
no legal, administrative, arbitration or other proceedings, or to the knowledge
of the Sellers, governmental investigations, pending or, to the knowledge of
the
Sellers, threatened, against the Sellers or the Company, relating to the
Business or the Company or its properties (including leased property), or the
transactions contemplated by this Agreement, nor is there any basis known to
the
Sellers for any such action.
(b) There
are
no judgments, decrees or orders, to the knowledge of the Sellers, of any court,
or any governmental department, commission, board, agency or instrumentality
relating to the Business or the Company the effect of which is to prohibit
any
business
practice or the acquisition of any property or the conduct of any business
by
the Company or which limit or control or otherwise adversely affect its method
or manner of doing business.
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4.15 Absence
of Certain Changes or Events.
The
Company has not, since December 31, 2006 (the “Balance Sheet Date”), except as
described on Schedule 4.15:
(a) Incurred
any material obligation or liability (absolute, accrued, contingent or
otherwise) except in the ordinary course of its business or in connection with
the performance of this Agreement, and any such obligation or liability incurred
in the ordinary course is not materially adverse, except for claims, if any,
that are adequately covered by insurance;
(b) Discharged
or satisfied any lien or encumbrance, or paid or satisfied any obligations
or
liability (absolute, accrued, contingent or otherwise) other than in the
ordinary course of business that were not materially adverse;
(c) Increased
or established any reserve or accrual for taxes or other liability on its books
or otherwise provided therefor, except as may have been required under generally
accepted accounting principles due to income earned or expense accrued since
the
Balance Sheet Date and as disclosed to the Purchaser in writing;
(d) Mortgaged,
pledged or subjected to any lien, charge or other encumbrance any of its assets,
tangible or intangible;
(e) Sold
or
transferred any of its assets or cancelled any debts or claims or waived any
rights, except in the ordinary course of business and which has not been
materially adverse;
(f) Disposed
of or permitted to lapse any patents or trademarks or any patent or trademark
applications material to the operation of its business;
(g) Incurred
any significant labor trouble or granted any general or uniform increase in
salary or wages payable or to become payable by it to any director, officer,
employee or agent, or by means of any bonus or pension plan, contract or other
commitment increased the compensation of any director, officer, employee or
agent;
(h) Authorized
any capital expenditure for real estate or leasehold improvements, machinery,
equipment or molds in excess of $25,000.00 in the aggregate;
(i) Except
for this Agreement, entered into any material transaction other than in the
ordinary course of business;
(j) Issued
any stocks, bonds, or other corporate securities, or made any declaration or
payment of any dividend or any distribution in respect of its capital stock,
except the dividend in the amount of US$172,436 or in the ordinary course of
business; or
8
(k) Experienced
damage, destruction or loss (whether or not covered by insurance) individually
or in the aggregate materially and adversely affecting any of its properties,
assets or business, or experienced any other material adverse change or changes
individually or in the aggregate affecting its financial condition, assets,
liabilities or business.
4.16. Absence
of Certain Commercial Practices.
To the
knowledge of the Sellers, neither the Company nor the Sellers have made any
payment (directly or by secret commissions, discounts, compensation or other
payments) or given any gifts to any governmental entity (domestic or foreign)
or
to a political party or candidate for political office (domestic or foreign),
to
obtain or retain business for the Company or to receive favorable or
preferential treatment, in either case, that would violate the laws of the
United States.
4.17 Employee
Benefit Plans.
The
Company does not maintain any employee benefit plans.
4.18 Licenses,
Permits, Consents and Approvals.
To the
knowledge of the Sellers, the Company has all licenses, permits or other
authorizations of governmental, regulatory or administrative agencies or
authorities (collectively, “Licenses”) required to conduct the Business. All
Licenses of the Company are listed on Schedule 4.18 hereto.
At the Closing, the Company will have all such Licenses which are material
to
the conduct of the Business and will have renewed all Licenses which would
have
expired in the interim. Except as listed in Schedule 4.18, no registration,
filing, application, notice, transfer, consent, approval, order, qualification,
waiver or other action of any kind (collectively, a “Filing”) will be required
as a result of the sale of the Interest by the Sellers in accordance with this
Agreement (a) to avoid the loss of any License or the violation, breach or
termination of, or any default under, or the creation of any lien on any asset
of the Company pursuant to the terms of, any law, regulation, order or other
requirement or any contract binding upon the Company or to which any such asset
may be subject, or (b) to enable Purchaser (directly or through any
designee) to continue the operation of the Company and the Business
substantially as conducted prior to the Closing Date. All such Filings will
be
duly filed, given, obtained or taken on or prior to the Closing Date and will
be
in full force and effect on the Closing Date.
4.
19 Environmental
Matters.
To the
knowledge of the Sellers, except
as
set forth on Schedule 4.19 hereto:
(a) the
operations of the Company are in compliance with all applicable Laws promulgated
by any governmental entity which prohibit, regulate or control any hazardous
material or any hazardous material activity (“Environmental Laws”) and all
permits issued pursuant to Environmental Laws or otherwise except for where
noncompliance or the absence of such permits would not, individually or in
the
aggregate, have a material adverse effect on the Company;
(b) the
Company has obtained all permits required under all applicable Environmental
Laws necessary to operate its business;
9
(c) the
Company is not the subject of any outstanding written order or Contract with
any
governmental authority or person respecting Environmental Laws or any violation
or potential violations thereof; and
(d) the
Company has not received any written communication alleging either or both
that
the Company may be in violation of any Environmental Law, or any permit issued
pursuant to Environmental Law, or may have any liability under any Environmental
Law.
4.20 Broker.
Other
than North American Capital Resources, LLC (d/b/a Sunbelt, neither the Company
nor the Sellers have retained any broker in connection with any transaction
contemplated by this Agreement. Purchaser and the Company shall not be obligated
to pay any fee or commission associated with the retention or engagement by
the
Company or the Sellers of any broker in connection with any transaction
contemplated by this Agreement.
4.21 Patriot
Act.
The
Sellers certify that the Company has not been designated, and is not owned
or
controlled, by a “suspected terrorist” as defined in Executive Order 13224. The
Sellers hereby acknowledge that the Purchaser seeks to comply with all
applicable laws concerning money laundering and related activities. In
furtherance of those efforts, the Sellers hereby represent, warrant and agree
that: (i) none of the cash or property that the Sellers have contributed or
paid
or will contribute and pay to the Company has been or shall be derived from,
or
related to, any activity that is deemed criminal under United States law; and
(ii) no contribution or payment by the Company to the Purchaser, to the extent
that they are within the Company’s control shall cause the Purchaser to be in
violation of the United States Bank Secrecy Act, the United States International
Money Laundering Control Act of 1986 or the United States International Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001. The Sellers
shall
promptly notify the Purchaser if any of these representations ceases to be
true
and accurate regarding the Sellers or the Company. The Sellers agree to provide
the Purchaser any additional information regarding the Company that the
Purchaser reasonably requests to ensure compliance with all applicable laws
concerning money laundering and similar activities.
4.22 Investment
Intent.
The AGS
Shares are being acquired hereunder by the Sellers for investment purposes
only,
for their own account, not as a nominee or agent and not with a view to the
distribution thereof, except in compliance with the Securities Act of 1933,
as
amended, and applicable law. The Sellers have no present intention to sell
or
otherwise dispose of the AGS Shares and will not do so except in compliance
with
the provisions of the Securities Act of 1933, as amended, and applicable law.
The Sellers understand that the AGS Shares acquired hereunder must be held
indefinitely unless a subsequent disposition or transfer of any of said shares
is registered under the Securities Act of 1933, as amended, or is exempt from
registration therefrom. The Sellers further understand that the exemption from
registration afforded by Rule 144 (the provisions of which are known to the
Sellers) promulgated under the Securities Act of 1933, as amended, depends
on
the satisfaction of various conditions, and that, if and when applicable, Rule
144 may afford the basis for sales only in limited amounts.
4.23 Investment
Experience; Suitability.
The
Sellers are sophisticated investors familiar with the type of risks inherent
in
the acquisition of securities such as the AGS Shares and the Sellers’ financial
position is such that the Sellers can afford to retain the AGS Shares for an
indefinite period of time without realizing any direct or indirect cash return
on their investment.
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4.24 No
Other Representations or Warranties; Schedules.
Except
for the representations and warranties contained in this Article IV (as modified
by the schedules hereto), neither the Sellers nor any other person makes any
express or implied representation or warranty with respect to the Sellers,
the
Company, the Business or the transactions contemplated by this Agreement, and
the Sellers disclaim any other representations or warranties, whether made
by
the Sellers, any affiliate of the Sellers or any of their respective officers,
managers, employees, agents or representatives. Except for the representations
and warranties contained in Article IV hereof (as modified by the schedules
hereto), the Sellers (i) expressly disclaim and negate any representation or
warranty, expressed or implied, at common law, by statute or otherwise, relating
to the condition of the Fixed Assets (including any implied or expressed
warranty of merchantability or fitness for a particular purpose, or of
conformity to models or samples of materials) and (ii) hereby disclaims all
liability and responsibility for any representation, warranty, projection,
forecast, statement, or information made, communicated, or furnished (orally
or
in writing) to the Purchaser or its affiliates or representatives (including
any
opinion, information, projection or advice that may have been or may be provided
to the Purchaser by any director, officer, employee, agent, consultant or
representative of the Sellers or any of their affiliates). The Sellers makes
no
representations or warranties to the Purchaser regarding the probable success
or
profitability of the Company of the Business. The disclosure of any matter
or
item in any schedule hereto shall not be deemed to constitute an acknowledgment
that any such matter is required to be disclosed.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
The
Purchaser hereby represents and warrants to the Sellers that:
5.1 Organization
and Good Standing. The
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware.
5.2 Authority.
(a) The
execution and delivery of this Agreement and the consummation of the
transactions contemplated herein have been, or will prior to Closing be, duly
and validly approved and acknowledged by all necessary corporate action on
the
part of the Purchaser.
(b) The
execution of this Agreement and the delivery hereof to the Sellers and the
purchase contemplated herein have been, or will be prior to Closing, duly
authorized by the Purchaser’s Board of Directors.
(c) The
Purchaser has the full legal right, power and authority to execute, deliver
and
carry out the terms and provisions of this Agreement; and this Agreement has
been duly and validly executed and delivered on behalf of the Purchaser and
constitutes a valid and binding obligation of the Purchaser enforceable in
accordance with its terms, except
to
the extent that enforceability may be limited by bankruptcy, insolvency and
other similar laws affecting the enforcement of creditor’s rights generally and
general equity principles
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.
5.2 Conflicts;
Consents of Third Parties.
(a) The
execution and delivery of this Agreement, the acquisition of the Interest by
Purchaser and the consummation of the transactions herein contemplated, and
the
compliance with the provisions and terms of this Agreement, are not prohibited
by the Articles of Incorporation or Bylaws of the Purchaser and will not
violate, conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, any court order, indenture, mortgage, loan
agreement, or other agreement or instrument to which the Purchaser is a party
or
by which it is bound.
(b) No
consent, waiver, approval, order, permit or authorization of, or declaration
or
filing with, or notification to, any person or governmental body is required
on
the part of the Purchaser in connection with the execution and delivery of
this
Agreement or the Purchaser Documents or the compliance by Purchaser with any
of
the provisions hereof or thereof.
5.3 Litigation. There
are
no legal proceedings pending or, to the best knowledge of the Purchaser,
threatened that are reasonably likely to prohibit or restrain the ability of
the
Purchaser to enter into this Agreement or consummate the transactions
contemplated hereby.
5.4 Due
Authorization of AGS Shares. The
AGS
Shares when delivered to the Sellers shall be validly issued and outstanding
as
fully paid and non-assessable,
free
and clear of any liens, pledges, encumbrances, charges, agreements, options,
claims or other arrangements or restrictions of any kind.
5.5 Condition
of the Business.
Notwithstanding anything contained in this Agreement to the contrary, Purchaser
acknowledges and agrees that Sellers are not making any representations or
warranties whatsoever, express or implied, beyond those expressly given by
the
Sellers in Article IV hereof (as modified by the Schedules hereto as
supplemented or amended), and Purchaser acknowledges and agrees that, except
for
the representations and warranties contained therein, the Company and the
Business are being transferred on a “where is” and, as to condition, “as is”
basis. Any claims Purchaser may have for breach of representation or warranty
shall be based solely on the representations and warranties of the Sellers
set
forth in Article IV hereof (as modified by the Schedules hereto as supplemented
or amended). Purchaser further represents that neither the Sellers nor any
of
their affiliates nor any other person has made any representation or warranty,
express or implied, as to the accuracy or completeness of any information
regarding the Company, the Business or the transactions contemplated by this
Agreement not expressly set forth in this Agreement, and none of the Sellers,
any of their affiliates or any other person will have or be subject to any
liability to Purchaser or any other person resulting from the distribution
to
Purchaser or its representatives or Purchaser’s use of, any such information,
including any confidential memoranda distributed on behalf of the Sellers
relating to the Company, the Business or other publications or data room information
provided to Purchaser or its representatives, or any other document or
information in any form provided to Purchaser or its representatives in
connection with the sale of the Interests and the transactions contemplated
hereby. Purchaser acknowledges that it has conducted to its satisfaction, its
own independent investigation of the Business and, in making the determination
to proceed with the transactions contemplated by this Agreement, Purchaser
has
relied on the results of its own independent investigation.
12
ARTICLE
VI
POST-CLOSING
COVENANTS
6.1 Publicity. Neither
of the Sellers nor the Purchaser shall issue any press release or public
announcement concerning this Agreement or the transactions contemplated hereby
without obtaining the prior written approval of the other party hereto, which
approval will not be unreasonably withheld or delayed, unless, in the sole
judgment of the Purchaser or the Sellers, disclosure is otherwise required
by
applicable Law or by the applicable rules of any stock exchange on which the
Purchaser lists securities, provided that, to the extent required by applicable
law, the party intending to make such release shall use its best efforts
consistent with such applicable law to consult with the other party with respect
to the text thereof.
6.2 Financial
Statements.
The
Sellers shall cooperate with the Purchaser to provide all information required
for the completion of audited financial statements of the Company to be prepared
and delivered no later than 75 days from the Closing Date.
6.3 Non-Competition.
For a
period of three years after the Closing Date, Sellers agree not to engage in
any
of the following competitive activities: (a) engaging directly or indirectly
in
any business or activity substantially similar to any business or activity
engaged in (or scheduled to be engaged) by the Company in the Peoples Republic
of China; (b) engaging directly or indirectly in any business or activity
competitive with any business or activity engaged in (or scheduled to be
engaged) by the Company in the Peoples Republic of China; (c) soliciting or
taking away any employee, agent, representative, contractor, supplier, vendor,
customer, franchisee, lender or investor of the Company, or attempting to so
solicit or take away; (d) interfering with any contractual or other relationship
between the Company and any employee, agent, representative, contractor,
supplier, vendor, customer, franchisee, lender or investor; or (e) using, for
the benefit of any person or entity other than the Company, any confidential
information of the Company. In addition, no Seller shall make or permit the
making of any negative statement of any kind concerning the Company, the
Purchaser or their affiliates, or their directors, officers or
agents.
6.4 Registration
of AGS Shares.
(a) Purchaser
shall file a registration statement with the Securities and Exchange Commission
within 45 days after the Closing Date which seeks to register for resale the
AGS
Shares (the
“Registration Statement”).
Purchaser shall use its reasonable best efforts to cause such registration
statement to be declared effective within 120 days of the filing date of such
registration statement.
The
Purchaser will furnish to the Sellers all information concerning the Purchaser
and any of its affiliates required to be set forth in the Registration
Statement, and the Purchaser will provide the Sellers and their counsel the
opportunity to review and approve such
information as set forth in the Registration Statement. The Purchaser shall
also
take any reasonable action required to be taken under any applicable blue sky
laws in connection with the issuance of the AGS Shares.
13
(b) The
Purchaser agrees to indemnify, defend, reimburse and hold harmless, to the
extent permitted by law, each holder of the AGS Shares included in the
Registration Statement against all losses, claims, damages, liabilities and
expense (including reasonable legal expenses and any expenses incurred in
investigation any claims) caused by any untrue or alleged untrue statement
of
material fact contained in the Registration Statement or any amendment thereof
or supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein,
in
light of the circumstances under which they were made, not misleading or any
other violation or breach of the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, or any state securities or blue
sky
law by the Purchaser.
(c) The
Purchaser shall pay all of its own expenses incident to its performance of
or
compliance with this Section 6.4, including all registration and filing
fees, printing, messenger, telephone and delivery expenses, fees and
disbursements of counsel for the Purchaser and fees and disbursements of all
independent auditors of the Purchaser.
ARTICLE
VII
DOCUMENTS
TO BE DELIVERED
7.1 Documents
to be Delivered by the Sellers. At
the
Closing, the Sellers shall deliver, or cause to be delivered, to the Purchaser
the following:
(a) copies
of
all consents and waivers necessary to consummate the transaction;
(b) written
resignations of each of the directors of the Company, other than ▇▇▇▇ ▇▇▇▇▇▇▇
and ▇▇▇ ▇▇▇▇▇;
(c) the
Joint
Venture Interest Transfer Agreement duly executed by AGS, in the form attached
hereto as Exhibit A (the “Transfer
Agreement”);
provided; however, if a provision of this Agreement and a provision of the
Transfer Agreement are in conflict, the applicable provision of this Agreement
and then the applicable provision of the Transfer Agreement shall control,
in
that order; and
(d) such
other documents as the Purchaser shall reasonably request.
7.2 Documents
to be Delivered by the Purchaser. At
the
Closing, the Purchaser shall deliver to the Sellers the following:
(a) the
Cash
Purchase Price;
(b) the
AGS
Shares; and
(c) such
other documents as the Sellers shall reasonably request.
14
ARTICLE
VIII
INDEMNIFICATION
8.1 Indemnification.
(a) Subject
to Section 8.2 hereof, the Sellers hereby agrees to indemnify and hold the
Purchaser, the Company, and their respective directors, officers, employees,
affiliates, agents, successors and assigns harmless from and
against:
(i) any
and
all losses, liabilities, obligations, damages, costs and expenses based upon,
attributable to or resulting from the failure of any representation or warranty
of the Sellers set forth in Section 4 hereof to be true and correct in all
respects as of the date made;
(ii) any
and
all losses, liabilities, obligations, damages, costs and expenses based upon,
attributable to or resulting from the breach of any covenant or other agreement
on the part of the Sellers under this Agreement; and
(iii) any
and
all notices, actions, suits, proceedings, claims, demands, assessments,
judgments, costs, penalties and expenses, including attorneys' and other
professionals' fees and disbursements (collectively, “Expenses”)
incident
to any and all losses, liabilities, obligations, damages, costs and expenses
with respect to which indemnification is provided hereunder (individually,
a
“Loss”
and, collectively, “Losses”).
Purchaser
acknowledges and agrees that the Sellers shall not have any liability under
any
provision of this Agreement for any Loss to the extent that such Loss relates
to
action taken by Purchaser or any other person (other than Sellers in breach
of
this Agreement) after the Closing Date. Purchaser shall take and shall cause
its
affiliates to take all reasonable steps to mitigate any Loss upon becoming
aware
of any event which would reasonably be expected to, or does, give rise thereto,
including incurring costs only to the minimum extent necessary to remedy the
breach which gives rise to the Loss. No representation or warranty of the
Sellers contained herein shall be deemed untrue or incorrect, and the Sellers
shall not be deemed to have breached a representation or warranty, as a
consequence of the existence of any fact, circumstance or event of which (i)
is
disclosed in response to another representation or warranty contained in this
Agreement, (ii) is disclosed in any accounting and/or due diligence reports
prepared at the request of Purchaser, or (iii) Purchaser is aware as of the
Closing Date.
(b) Purchaser
hereby agrees to indemnify and hold the Sellers and their respective
shareholders, directors, officers, employees, affiliates, agents, successors
and
assigns harmless from and against:
(i) any
and
all Losses based upon, attributable to or resulting from the failure of any
representation or warranty of the Purchaser set forth in Section 5 hereof to
be
true and correct as of the date made;
(ii) any
and
all Losses based upon, attributable to or resulting from the breach of any
covenant or other agreement on the part of the Purchaser under this Agreement
or arising from the ownership or operation of the Company from and after the
Closing Date; and
15
(iii) any
and
all Expenses incident to the foregoing.
Sellers
shall take and shall cause its affiliates to take all reasonable steps to
mitigate any Loss upon becoming aware of any event which would reasonably be
expected to, or does, give rise thereto, including incurring costs only to
the
minimum extent necessary to remedy the breach which gives rise to the Loss.
No
representation or warranty of Purchaser contained herein shall be deemed untrue
or incorrect, and Purchaser shall not be deemed to have breached a
representation or warranty, as a consequence of the existence of any fact,
circumstance or event of which (i) is disclosed in response to another
representation or warranty contained in this Agreement or (ii) the Sellers
are
aware as of the Closing Date.
8.2 Limitations
on Indemnification for Breaches of Representations and Warranties: Maximum
Amount of Indemnification.
An
indemnifying party shall not be liable for any claim for indemnification
pursuant to Section 8.1(a)(i) or Section 8.1(b)(i) unless the aggregate amount
of Losses and Expenses to the indemnified parties finally determined to arise
thereunder based upon, attributable to or resulting from the failure of any
representation or warranty to be true and correct, equals or exceeds $25,000
(the “Basket”) and, in such event, the indemnifying party shall be required to
pay the entire amount of such Losses and Expenses in excess of $25,000 (the
“Deductible”). In no event shall the aggregate liability of the indemnifying
party with respect to all indemnified party claims for indemnification exceed,
in the aggregate, the Purchase Price.
8.3 Indemnification
Procedures.
(a) In
the
event that any legal proceedings shall be instituted or that any claim or demand
("Claim") shall be asserted by any Person in respect of which payment may be
sought under Section 8.1 hereof (regardless of the Basket or the Deductible
referred to above), the indemnified party shall reasonably and promptly cause
written notice of the assertion of any Claim of which it has knowledge which
is
covered by this indemnity to be forwarded to the indemnifying party. The
indemnifying party shall have the right, at its sole option and expense, to
be
represented by counsel of its choice, which must be reasonably satisfactory
to
the indemnified party, and to defend against, negotiate, settle or otherwise
deal with any Claim which relates to any Losses indemnified against hereunder.
If the indemnifying party elects to defend against, negotiate, settle or
otherwise deal with any Claim which relates to any Losses indemnified against
hereunder, it shall within ten (10) days (or sooner, if the nature of the Claim
so requires) notify the indemnified party of its intent to do so. If the
indemnifying party elects not to defend against, negotiate, settle or otherwise
deal with any Claim which relates to any Losses indemnified against hereunder,
fails to notify the indemnified party of its election as herein provided or
contests its obligation to indemnify the indemnified party for such Losses
under
this Agreement, the indemnified party may defend against, negotiate, settle
or
otherwise deal with such Claim. If the indemnified party defends any Claim,
then
the indemnifying party shall reimburse the indemnified party for the Expenses
of
defending such Claim upon submission of periodic bills. If the indemnifying
party shall assume the defense of any Claim, the indemnified party may
participate, at its own expense, in the defense of such Claim; provided,
however, that such indemnified party shall be entitled to participate in any
such defense with separate counsel at
16
the
expense of the indemnifying party if, (i) so requested by the indemnifying
party
to participate or (ii) in the reasonable opinion of counsel to the indemnified
party, a conflict or potential conflict exists between the indemnified party
and
the indemnifying party that would make such separate representation advisable;
and provided, further, that the indemnifying party shall not be required to
pay
for more than one such counsel for all indemnified parties in connection with
any Claim. The parties hereto agree to cooperate fully with each other in
connection with the defense, negotiation or settlement of any such
Claim.
(b) After
any
final judgment or award shall have been rendered by a court, arbitration board
or administrative agency of competent jurisdiction and the expiration of the
time in which to appeal therefrom, or a settlement shall have been consummated,
or the indemnified party and the indemnifying party shall have arrived at a
mutually binding agreement with respect to a Claim hereunder, the indemnified
party shall forward to the indemnifying party notice of any sums due and owing
by the indemnifying party pursuant to this Agreement with respect to such matter
and the indemnifying party shall be required to pay all of the sums so due
and
owing to the indemnified party by wire transfer of immediately available funds
within 10 business days after the date of such notice.
(c) The
failure of the indemnified party to give reasonably prompt notice of any Claim
shall not release, waive or otherwise affect the indemnifying party's
obligations with respect thereto except to the extent that the indemnifying
party can demonstrate actual loss and prejudice as a result of such
failure.
8.4 Calculation
of Losses.
The
amount of any Loss subject to indemnification under Sections 8.1(a) and (b)
shall be calculated net of (a) any Tax Benefit received by the indemnified
party
or any of their affiliates on account of such Loss and (b) any insurance
proceeds or any indemnity, contribution or other similar payment received by
the
indemnified party from any third party with respect thereto. If the indemnified
party receives a Tax Benefit after an indemnification payment is made to it,
the
indemnified party shall promptly pay to the indemnifying party the amount of
such Tax Benefit at such time or times as and to the extent that such Tax
Benefit is actually realized by the indemnified party. For purposes hereof,
“Tax
Benefit” shall mean any refund of taxes paid or reduction in the amount of taxes
which otherwise would have been paid. The indemnified party shall seek full
recovery under all insurance policies covering any Loss to the same extent
as
they would if such Loss were not subject to indemnification hereunder. In the
event that an insurance or other recovery is made by any indemnified party
with
respect to any Loss for which any such person has been indemnified hereunder,
then a refund equal to the aggregate amount of the recovery shall be made
promptly to the indemnifying party. The indemnifying party shall be subrogated
to all rights of the indemnified party and their affiliates in respect of any
Losses indemnified by the indemnifying party
8.5 No
Extraordinary Damages.
Notwithstanding anything to the contrary elsewhere in this Agreement, no party
shall, in any event, be liable to any other Person for any consequential,
incidental, indirect, special or punitive damages of such other
Person.
17
8.6 Exclusive
Remedy.
The
sole and exclusive remedy for any breach or inaccuracy, or alleged breach or
inaccuracy, of any representation or warranty in this Agreement or any covenant
or agreement to be performed on or prior to the Closing Date, shall be
indemnification in accordance with this Article VIII. In furtherance of the
foregoing, the parties hereby waive, to the fullest extent permitted by
applicable law, any and all other rights, claims and causes of action (including
rights of contributions, if any) known or unknown, foreseen or unforeseen,
which
exist or may arise in the future, that it may have against the Sellers or
Purchaser, as the case may be, arising under or based upon any federal, state
or
local law (including any such law relating to environmental matters or arising
under or based upon any securities law, common Law or otherwise).
8.7 Tax
Treatment of Indemnity Payments. The
Sellers and the Purchaser agree to treat any indemnity payment made pursuant
to
this Article VIII as an adjustment to the Purchase Price for federal, state,
local and foreign income tax purposes.
ARTICLE
IX
MISCELLANEOUS
9.1 Payment
of Sales, Use or Similar Taxes. All
sales, use, transfer, intangible, recordation, documentary stamp or similar
Taxes or charges, of any nature whatsoever, applicable to, or resulting from,
the transactions contemplated by this Agreement shall be borne by the
Purchaser.
9.2 Survival
of Representations and Warranties. The
parties hereto hereby agree that the representations and warranties contained
in
this Agreement shall survive the execution and delivery of this Agreement,
and
the Closing hereunder, for a period of eighteen (18) months after the Closing
Date.
9.3 Expenses. Except
as
otherwise provided in this Agreement, the Sellers and the Purchaser shall each
bear its own expenses incurred in connection with the negotiation and execution
of this Agreement and each other agreement, document and instrument contemplated
by this Agreement and the consummation of the transactions contemplated hereby
and thereby, it being understood that in no event shall the Company bear any
of
such costs and expenses.
9.4 Specific
Performance. The
Sellers acknowledge and agree that the breach of this Agreement would cause
irreparable damage to the Purchaser and that the Purchaser will not have an
adequate remedy at law. Therefore, the obligations of the Sellers under this
Agreement, including, without limitation, the Sellers’ obligation to sell the
Interest to the Purchaser, shall be enforceable by a decree of specific
performance issued by any court of competent jurisdiction, and appropriate
injunctive relief may be applied for and granted in connection therewith. Such
remedies shall, however, be cumulative and not exclusive and shall be in
addition to any other remedies which any party may have under this Agreement
or
otherwise.
18
9.5 Further
Assurances. The
Sellers and the Purchaser each agree to execute and deliver such other documents
or agreements and to take such other action as may be reasonably necessary
or
desirable for the implementation of this Agreement and the consummation of
the
transactions contemplated hereby.
9.6 Submission
to Jurisdiction.
The
parties hereto hereby irrevocably submit to the non-exclusive jurisdiction
of
any federal or state court located within the State of Delaware over any dispute
arising out of or relating to this Agreement or any of the transactions
contemplated hereby and each party hereby irrevocably agrees that all claims
in
respect of such dispute or any suit, action proceeding related thereto may
be
heard and determined in such courts. The parties hereby irrevocably waive,
to
the fullest extent permitted by applicable law, any objection which they may
now
or hereafter have to the laying of venue of any such dispute brought in such
court or any defense of inconvenient forum for the maintenance of such dispute.
Each of the parties hereto agrees that a judgment in any such dispute may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
9.7 Entire
Agreement; Amendments and Waivers.
This
Agreement (including the schedules and exhibits hereto) represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the party against whom enforcement of
any
such amendment, supplement, modification or waiver is sought. No action taken
pursuant to this Agreement, including without limitation, any investigation
by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant
or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further
or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise
of
any other right, power or remedy.
9.8 Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware.
9.9 Dispute
Resolution.
(a) As
used
in this Agreement, “Dispute” shall mean any dispute or disagreement between
Purchaser and the Sellers concerning the interpretation of this Agreement,
the
validity of this Agreement, any breach or alleged breach by any Party under
this
Agreement or any other matter relating in any way to this Agreement provided,
that "Dispute" shall not include any dispute relating to the NTAV Calculation,
which shall be resolved in accordance with Section 2.3.
(b) If
a
Dispute arises, the parties to the Dispute shall follow the procedures specified
in Sections 9.9(c), (d) and (e).
19
(c) The
parties shall promptly attempt to resolve any Dispute by negotiations between
Purchaser and the Sellers. Purchaser or the Sellers, as the case may be, shall
give the other party written notice (the “Dispute Notice”) of any Dispute not
resolved in the normal course of business. Purchaser and the Sellers (or their
representatives) shall meet at a mutually acceptable time and place within
thirty (30) days after receipt of the Dispute Notice by the party to whom such
Dispute Notice was delivered, and thereafter as often as they reasonably deem
necessary, to exchange relevant information and to attempt to resolve the
Dispute. If Purchaser or the Sellers intend to be accompanied at any such
meeting by legal counsel, the other party shall be given at least three (3)
business days' prior written notice of such intention and may also be
accompanied by legal counsel. If the Dispute has not been resolved by the
parties (i) within ninety (90) days of receipt of a Dispute Notice, or (ii)
if
the parties fail to meet within thirty (30) days of receipt of such Dispute
Notice, either Purchaser or the Sellers may initiate binding arbitration as
provided in Section 9.9(d).
(d) If
the
Dispute is not resolved by negotiations pursuant to Section 9.9(c), all Disputes
shall be determined by binding arbitration in Chicago, Illinois in accordance
with the commercial rules of the AAA then in effect unless the parties mutually
agree in writing to waive this provision. This agreement to arbitrate shall
be
specifically enforceable under the laws of the State of Illinois. The party
initiating arbitration shall file written notice of the demand for arbitration
with the other party to the Dispute and with the AAA in Chicago, Illinois.
Such
demand for arbitration shall be made within sixty (60) days after the expiration
of the applicable time period set forth in the last sentence of Section 9.9(c),
and in no event shall such demand be made after the date when an institution
of
legal or equitable proceedings based upon such Dispute would be barred by this
Agreement or the applicable statute of limitations. The arbitration shall be
before a single arbitrator chosen in accordance with the rules of the AAA,
who
shall interpret this Agreement in accordance with the internal laws of the
State
of Delaware without reference to any rule or provision thereof which would
cause
the application of the law of any other state. The award rendered by the
arbitrator shall be final and binding and may not be appealed, and any judgment
may be entered upon it in accordance with the applicable law in any court having
jurisdiction thereof. In no event shall any party be awarded punitive
damages.
(e) At
any
time during the procedures specified in Sections 9.9(c) and (d), a party may
seek a preliminary injunction or other provisional judicial relief in the courts
of ▇▇▇▇ County, Illinois or the U.S. District Court for the Northern District
of
Illinois if in the judgment of such party such action is necessary to avoid
irreparable harm. Each party hereto consents to the exclusive jurisdiction
of
such courts with respect to this Section 9.9(e) and waive any objection to
venue
laid therein. Process in any proceeding referred to in this Section 9.9(e)
may
be served on any party anywhere in the world. Each Party shall use its
commercially reasonable efforts to perform its obligations under this Agreement
pending final resolution of any Dispute. All deadlines specified in this Section
9.9 may be extended by mutual written agreement between Purchaser and the
Sellers. The parties regard the obligations in this Section 9.9 to constitute
an
essential provision of this Agreement and one that is legally binding on them.
In case of a violation of the obligations in this Section 9.9 by either
Purchaser or the Sellers, the other party may bring an action to seek
enforcement of such obligations in any court of law having jurisdiction thereof.
The parties to the dispute shall pay their own costs, fees, and expenses
incurred in connection with the application of the provisions of this Section
9.9, and the prevailing party shall pay the fees and expenses of the AAA and
the
arbitrator in connection with the application of the provisions of Section
9.9.
20
9.10 Table
of Contents and Headings. The
table
of contents and section headings of this Agreement are for reference purposes
only and are to be given no effect in the construction or interpretation of
this
Agreement.
9.11 Notices. All
notices and other communications under this Agreement shall be in writing and
shall be deemed given when delivered personally or mailed by certified mail,
return receipt requested, to the parties (and shall also be transmitted by
facsimile to the Persons receiving copies
thereof) at the following addresses (or to such other address as a party may
have specified by notice given to the other party pursuant to this
provision):
(a) Purchaser:
WPCS
International Incorporated
▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
Phone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
Copy
to:
▇▇▇▇▇▇
▇.
▇▇▇▇, Esq.
Sichenzia
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
▇▇
▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Phone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
(b) Sellers:
American
Gas Services, Inc. Consultants
c/o
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇▇▇ #▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
Copy
to:
▇▇▇▇▇▇
▇.
▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Van Deuren s.c.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Phone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
21
9.12 Severability. If
any
provision of this Agreement is invalid or unenforceable, the balance of this
Agreement shall remain in effect.
9.13 Binding
Effect; Assignment. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and permitted assigns. Nothing in this Agreement
shall create or be deemed to create any third party beneficiary rights in any
person or entity not a party to this Agreement except as provided below. No
assignment of this Agreement or of any rights or obligations hereunder may
be
made by either the Sellers or the Purchaser (by operation of law or otherwise)
without the prior written consent of the other parties hereto and any
attempted assignment
without the required consents shall be void; provided, however, that the
Purchaser may assign this Agreement and any or all rights or obligations
hereunder (including, without limitation, the Purchaser's rights to purchase
the
Interest and the Purchaser's rights to seek indemnification hereunder) to any
affiliate of the Purchaser. Upon any such permitted assignment, the references
in this Agreement to the Purchaser shall also apply to any such assignee unless
the context otherwise requires.
9.14 Counterparts;
Facsimile Signature.
This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which together shall constitute one and the same agreement.
Each of the parties to this Agreement agrees that a signature affixed to a
counterpart of this Agreement and delivered by facsimile by any person is
intended to be its, his or her signature and shall be valid, binding and
enforceable against such person.
[intentionally
blank]
22
| WPCS INTERNATIONAL INCORPORATED | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇,
Chief
Executive Officer
|
||
| AMERICAN GAS SERVICES, INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇,
President
|
||
| AMERICAN GAS SERVICES, INC. CONSULTANTS: | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇,
President
|
||