STOCK PURCHASE AGREEMENT
(British Columbia)
This STOCK PURCHASE AGREEMENT is made as of October 19, 1999, by VENTURI
TECHNOLOGIES, INC., a Nevada corporation ("Buyer"), and ALL FOURS
DISTRIBUTING, INC., a Colorado corporation and ▇▇▇▇▇ ▇▇▇▇▇▇ (hereinafter
collectively referred to as "Sellers").
RECITALS
A. Sellers own all of the issued and outstanding capital stock (the
"Corporate Shares" or "Shares") of 593693 B.C. LTD., a British Columbia
corporation (hereinafter referred to as the "Company").
▇. ▇▇▇▇▇▇▇ desire to sell, and Buyer desires to purchase, all of the
Corporate Shares (hereinafter "Shares") for the consideration and on the
terms set forth in this Agreement.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. SALE AND TRANSFER OF SHARES; CLOSING
1.1 PURCHASE AND SALE OF SHARES. Subject to the terms and
conditions of this Agreement, at the Closing, Sellers will sell and transfer
the Shares to Buyer, and Buyer will purchase the Shares from Sellers.
1.2 PURCHASE PRICE.
1.2.1 CASH. At the Closing, Buyer will pay or deliver to
Sellers the following as partial consideration for the Shares of the Company
Fifty Thousand U.S. Dollars (U.S. $50,000.00) cash.
1.4 CLOSING. The purchase and sale (the "Closing") provided for
in this Agreement will take place at a time, place and date agreed to
mutually by the Parties.
1.5 CLOSING DELIVERIES.
1.5.1 SELLERS' DOCUMENTS. At the Closing, Sellers will
deliver to Escrow Agent:
(a) original certificates representing the Corporate
Shares duly endorsed (or accompanied by duly executed stock powers);
(b) Global Escrow Agreement, executed by Sellers, Buyer
and the Escrow Agent; and
(c) A separate employment agreement for both ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇▇, executed by each ("Employment Agreements").
1.5.2 BUYER'S DOCUMENTS. At the Closing, Buyer will deliver to
Escrow Agent:
(a) cash in the amount of U.S. $50,000.00; and
(b) the Employment Agreements, executed by Buyer.
2. REPRESENTATIONS AND WARRANTIES OF SELLER
To the best of their individual and collective knowledge and belief,
Sellers represent and warrant to Buyer as follows:
2.1 ORGANIZATION AND GOOD STANDING. (a) the Company is a
corporation duly organized, validly existing, and in good standing under the
laws of the British Columbia, with full corporate power and authority to
conduct its business as it is now being conducted, to own or use the
properties and assets that it purports to own or use, and to perform all its
obligations under applicable contracts. The Company is duly qualified to do
business as a foreign corporation and is in good standing under the laws of
each state or other jurisdiction in which either the ownership or use of the
properties owned or used by it, or the nature of the activities conducted by
it, requires such qualification.
2.2 AUTHORITY. This Agreement constitutes the legal, valid, and
binding obligation of Sellers, enforceable against Sellers in accordance with
its terms. Upon the execution and delivery by Sellers of the Global Escrow
Agreement and the Employment Agreements (collectively, the "Sellers' Closing
Documents"), the Sellers' Closing Documents will constitute the legal, valid,
and binding obligations of Sellers, enforceable against Sellers in accordance
with their respective terms. Sellers have the absolute and unrestricted
right, power, authority, and capacity to execute and deliver this Agreement
and the Sellers' Closing Documents and to perform their obligations under
this Agreement and the Sellers' Closing Documents.
2.3 NO CONFLICT. Neither the execution and delivery of this
Agreement nor the consummation or performance of any of the contemplated
transactions by Sellers will violate or constitute a default under any
mortgage, indenture, deed of trust, lease, contract, agreement, license or
other instrument or any order, judgement or ruling of any governmental
authority to which either Seller is subject, or to the best knowledge of
Sellers, any of the property of the Company is bound, or result in the
creation of any mortgage, pledge, lien, charge or encumbrance upon any of the
assets of the Company or the loss of any license or other contractual right
with respect thereto, except in
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each case for any of the foregoing which is not, individually or in the
aggregate, material to the Company.
Except as may be set forth in Exhibit A, no Seller or the Company is or
will be required to give any notice to or obtain any consent from any person
in connection with the execution and delivery of this Agreement or the
consummation or performance of the transaction contemplated hereby.
2.4 CAPITALIZATION. The authorized capital stock of 593693 B.C,
LTD. consists of 5,000 shares of common stock, no par value per share, of
which 100 shares are issued and outstanding and constitute the Shares.
Sellers are and will be on the Closing Date the record and beneficial owners
and holders of the Shares, free and clear of all Encumbrances. ALL FOURS
DISTRIBUTING, INC. owns 51 of the Shares and ▇▇▇▇▇ ▇▇▇▇▇▇ owns 49 of the
Shares. No legend or other reference to any purported Encumbrance appears
upon any certificate representing equity securities of the Company. All of
the outstanding equity securities of the Company have been duly authorized
and validly issued and are fully paid and nonassessable. There are no
Contracts relating to the issuance, sale, or transfer of any equity
securities or other securities of the Company. None of the outstanding equity
securities or other securities of the Company was issued in violation of the
Securities Act or any state law regulating the sale and issuance of
securities. The Company does not own, nor does it have any Contract to
acquire, any equity securities or other securities of any other business or
any direct or indirect equity or ownership interest in any other business.
2.5 FINANCIAL STATEMENTS. Sellers have delivered to Buyer an
unaudited balance sheet of the Company as of July 31, 1999 (the "Balance
Sheet"), and the related unaudited statements of income, changes in
stockholders' equity, and cash flow. Such financial statements and notes
were prepared in accordance with GAAP, subject, in the case of interim
financial statements, to normal recurring year-end adjustments (the effect of
which will not, individually or in the aggregate, be materially adverse) and
the absence of notes (that, if presented, would not differ materially from
those included in the balance sheet); the financial statements referred to in
this Section reflect the consistent application of such accounting principles
throughout the periods involved, except as disclosed in the notes to such
financial statements. No financial statements of any person or entity other
than the Company are required by GAAP to be included in the consolidated
financial statements of the Company. Also attached as Exhibit J are an
unaudited Balance Sheet and Income Statement for the Company for the period
ending October 17, 1999.
2.6 BOOKS AND RECORDS. The books of account, minute books, stock
record books, and other records of the Company, all of which have been made
available to Buyer, are complete and correct and have been maintained in
accordance with sound business practices. The minute books of the Company
contain accurate and complete records of all meetings held of, and corporate
action taken by, the stockholders, the Boards of Directors, and committees of
the Boards of Directors of the Company. At the Closing, all of those books
and records will be in the possession of the Company.
2.7 TITLE TO PROPERTIES; ENCUMBRANCES. Sellers have delivered to
Buyer a complete and accurate list of all inventory and personal property
interests owned by the Company. The "Inventory" is itemized in Exhibit A,
pages 1-4. The "Fixed Assets" are itemized in Exhibit A-1, pages 6-10. The
Company
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owns all the properties and assets that have been disclosed to Buyer. All
material properties disclosed as being owned by the Company are owned free
and clear of all liens and encumbrances except as previously disclosed in
writing to Buyer.
2.8 CONDITION AND SUFFICIENCY OF ASSETS. To the best of Sellers'
knowledge, except as set forth in Exhibit B, the Company's property and
assets are in good operating condition and repair, and are adequate for the
uses to which they are being put, and none of such property and assets are in
need of maintenance or repairs except for ordinary, routine maintenance and
repairs that are not material in nature or cost. The property and assets of
the Company are sufficient for the continued conduct of the Company's
business after the Closing in substantially the same manner as conducted
prior to the Closing.
2.9 ACCOUNTS RECEIVABLE. All accounts receivable of the Company
that are reflected in the accounting records of the Company as of the Closing
Date (collectively, the "Accounts Receivable") represent valid obligations
arising from sales actually made or services actually performed in the
ordinary course of business. To the best of Sellers' knowledge, unless paid
prior to the Closing Date, the Accounts Receivable are or will be as of the
Closing Date current and collectible. Absent any unforeseen events, each of
the Accounts Receivable historically has been collected in full within ninety
days after the day on which it first becomes due and payable. Except as may
be set forth on Exhibit C referred to below, there is not any pending, or to
Sellers' knowledge threatened, contest or claim challenging the validity of
any of the Accounts Receivable.
2.10 NO UNDISCLOSED LIABILITIES. Except as may be set forth in
Exhibit D, the Company has no liabilities or obligations of any nature
(whether known or unknown and whether absolute, accrued, contingent, or
otherwise) except for liabilities or obligations reflected or reserved
against in the Balance Sheet and current liabilities incurred in the ordinary
course of business.
2.11 TAXES. To the best of Sellers' knowledge the Company has
filed or caused to be filed within the past five (5) years all tax returns
that are or were required to be filed by or with respect to the Company,
pursuant to applicable laws and regulations (except use tax returns). To
the best of Sellers' knowledge, all tax returns filed by the Company are
true, correct, and complete.
2.12 NO MATERIAL ADVERSE CHANGE. To the best of Sellers'
knowledge, since the date of the Balance Sheet, there has not been any
material adverse change in the business, operations, properties, prospects,
assets, or condition of the Company, and no event has occurred or
circumstance exists that may result in such a material adverse change.
2.13 CONTRACTS AND EMPLOYEE BENEFITS. Except as may be set forth
in Exhibit E, the Company is not a party to any contract or agreement that
involves annual payments by the Company in excess of $25,000, other than in
the ordinary course of business. The consummation of the transaction
contemplated herein will not result in the termination of any material
agreement or contract to which the Company is a party, nor give any party
thereto the right to cancel or terminate any such contract or agreement.
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2.14 [Intentionally Omitted]
2.15 COMPLIANCE WITH LEGAL REQUIREMENTS. Except as may be set
forth on Exhibit G, the Company has not received any notice of any violation
of any laws or regulations that are or were applicable to it or to the
conduct or operation of its business or the ownership or use of any of its
assets, which violation has not been cured as of the Closing Date, and to the
best knowledge of Sellers, the Company is in full compliance with all such
laws or regulations.
2.16 GOVERNMENTAL AUTHORIZATIONS. The Company has obtained all
governmental authorizations and permits that are necessary to permit the
Company to lawfully conduct and operate its business in the manner currently
conducted.
2.17 LEGAL PROCEEDINGS. Except as disclosed in Exhibit H, there is
no material lawsuit or legal or administrative or regulatory proceeding or
investigation pending against the Company or, to the best knowledge of
Sellers, threatened against the Company
2.18 ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as may be set
forth in Exhibit I, since the date of the Balance Sheet, the Company has
conducted its business only in the ordinary course of business and there has
not been any:
(a) change in the Company's authorized or issued capital stock;
grant of any stock option or right to purchase shares of capital stock of
the Company; issuance of any security convertible into such capital stock;
grant of any registration rights; purchase, redemption, retirement, or other
acquisition by the Company of any shares of any such capital stock; or
declaration or payment of any dividend or other distribution or payment in
respect of shares of capital stock;
(b) amendment to the organizational documents of the Company;
(c) payment or increase by the Company of any extraordinary
bonuses, salaries, or other compensation to any stockholder, director,
officer, or (except in the ordinary course of business) employee or entry
into any employment, severance, or similar contract with any director,
officer, or employee;
(d) adoption of, or increase in the payments to or benefits
under, any profit sharing, bonus, deferred compensation, savings, insurance,
pension, retirement, or other employee benefit plan for or with any
employees of the Company;
(e) material damage to or destruction or loss of any asset or
property of the Company, whether or not covered by insurance, materially and
adversely affecting the properties, assets, business, financial condition,
or prospects of the Company taken as a whole;
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(f) entry into, termination of, or receipt of notice of
termination of (i) any license, distributorship, dealer, sales
representative, joint venture, credit, or similar agreement, or (ii) any
contract or transaction involving a total remaining commitment by or to the
Company of at least $25,000;
(g) sale (other than sales of inventory in the ordinary course
of business), lease, or other disposition of any asset or property of the
Company or mortgage, pledge, or imposition of any lien or other encumbrance
on any material asset or property of the Company;
(h) cancellation or waiver of any claims or rights with a value
to the Company in excess of $25,000; or
(i) material change in the accounting methods used by the
Company.
2.19 INSURANCE. The Company maintains policies of insurance in
such amounts, with such deductibles and against such risks and losses as are,
in its judgment, reasonable for the business and assets of the Company, and
Sellers will deliver to Buyer on the Closing Date certificates of insurance
setting forth the name of the insurance company, policy number and type of
coverage of all insurance policies maintained as of the date hereof with
respect to the Company's business operations, property, plant and equipment.
2.20 ENVIRONMENTAL MATTERS. There are no pending or, to the
knowledge of Sellers and the Company, threatened claims, encumbrances, or
other restrictions of any nature, resulting from any environmental, health,
and safety liabilities or arising under or pursuant to any environmental law,
with respect to or affecting any of the operations, properties and assets
(whether real, personal, or mixed) in which Sellers or the Company has or had
an interest.
2.21 DISCLOSURE. No representation or warranty of Sellers in this
Agreement and no statement in the Exhibits attached to this Agreement omits
to state a material fact necessary to make the statements herein or therein,
in light of the circumstances in which they were made, not misleading. There
is no fact known to either Seller that has specific application to either
Seller or the Company (other than general economic or industry conditions)
and that materially adversely affects or, as far as either Seller can
reasonably foresee, materially threatens, the assets, business, prospects,
financial condition, or results of operations of the Company (on a
consolidated basis) that has not been set forth in this Agreement or the
Exhibits attached hereto.
2.22 BROKERS OR FINDERS. Sellers and Sellers' agents have incurred
no obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other similar payment in connection
with this Agreement.
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3. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers as follows:
3.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Nevada.
3.2 AUTHORITY; NO CONFLICT. This Agreement constitutes the legal,
valid, and binding obligation of Buyer, enforceable against Buyer in
accordance with its terms. Upon the execution and delivery by Buyer of the
Employment Agreements, and the Promissory Notes (collectively, the "Buyer's
Closing Documents"), the Buyer's Closing Documents will constitute the legal,
valid, and binding obligations of Buyer, enforceable against Buyer in
accordance with their respective terms. Buyer has the absolute and
unrestricted right, power, and authority to execute and deliver this
Agreement and the Buyer's Closing Documents and to perform its obligations
under this Agreement and the Buyer's Closing Documents. Except as set forth
in Exhibit G, neither the execution and delivery of this Agreement nor the
consummation or performance of any of the transactions contemplated hereby
will give any person the right to prevent, delay, or otherwise interfere with
any of the transactions contemplated hereby pursuant to:
(i) any provision of Buyer's Organizational Documents;
(ii) any resolution adopted by the board of directors or the
stockholders of Buyer;
(iii) any legal requirement or order to which Buyer may be
subject; or
(iv) any contract to which Buyer is a party or by which Buyer
may be bound.
Except as set forth in Exhibit G, Buyer is not and will not be required to
obtain any Consent from any person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
transactions contemplated hereby.
3.3 INVESTMENT INTENT. Buyer is acquiring the Shares for its own
account and not with a view to their distribution within the meaning of
Section 2(11) of the Securities Act.
3.4 CERTAIN PROCEEDINGS. There is no pending legal proceeding
that has been commenced against Buyer and that challenges, or may have the
effect of preventing, delaying, making illegal, or otherwise interfering
with, any of the Contemplated Transactions. To Buyer's knowledge, there exist
no grounds for such proceeding, nor has any such proceeding been threatened.
3.5 BROKERS OR FINDERS. Buyer and its officers and agents have
incurred no obligation or liability, contingent or otherwise, for brokerage
or finders' fees or agents' commissions or other similar payment in
connection with this Agreement and will indemnify and hold Sellers harmless
from
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any such payment alleged to be due by or through Buyer as a result of the
action of Buyer or its officers or agents.
4. COVENANTS OF SELLERS PRIOR TO CLOSING DATE
4.1 ACCESS AND INVESTIGATION. Between the date of this Agreement
and the Closing Date, Sellers will, and will cause the Company and its
representatives to, (a) afford Buyer and its representatives and prospective
lenders and their representatives (collectively, "Buyer's Advisors") full and
free access to the Company's personnel, properties, contracts, books and
records, and other documents and data, (b) furnish Buyer and Buyer's Advisors
with copies of all such contracts, books and records, and other existing
documents and data as Buyer may reasonably request, and (c) furnish Buyer and
Buyer's Advisors with such additional financial, operating, and other data
and information as Buyer may reasonably request.
4.2 OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES.
Between the date of this Agreement and the Closing Date, Sellers will, and
will cause the Company to:
(a) conduct the business of the Company only in the ordinary
course of business;
(b) use their best efforts to preserve intact the current
business organization of the Company, keep available the services of the
current officers, employees, and agents of the Company, and maintain the
relations and good will with suppliers, customers, landlords, creditors,
employees, agents, and others having business relationships with the
Company;
(c) confer with Buyer concerning operational matters of a
material nature; and
(d) otherwise report periodically to Buyer concerning the
status of the business, operations, and finances of the Company.
4.3 NEGATIVE COVENANT. Except as otherwise expressly permitted by
this Agreement, between the date of this Agreement and the Closing Date,
Sellers will not, and will cause the Company not to, without the prior
consent of Buyer, take any affirmative action, or fail to take any reasonable
action within their or its control, as a result of which any material change
in the business of the Company is likely to occur.
4.4 REQUIRED APPROVALS. As promptly as practicable after the date
of this Agreement, Sellers will, and will cause the Company to, make all
reports and filings required by applicable laws and regulations to be made by
them in order to consummate the transactions contemplated hereby. Between
the date of this Agreement and the Closing Date, Sellers will, and will cause
the Company to, (a) cooperate with Buyer with respect to all filings that
Buyer elects to make or is required by
8
applicable laws and regulations to make in connection with the transactions
contemplated hereby, and (b) cooperate with Buyer in obtaining all consents
necessary or appropriate to consummate the transactions contemplated hereby.
4.5 NOTIFICATION. Between the date of this Agreement and the
Closing Date, each Seller will promptly notify Buyer in writing if such
Seller or the Company becomes aware of any fact or condition that causes or
constitutes a Breach of any of Sellers' representations and warranties as of
the date of this Agreement, or if such Seller or the Company becomes aware of
the occurrence after the date of this Agreement of any fact or condition that
would (except as expressly contemplated by this Agreement) cause or
constitute a Breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or
discovery of such fact or condition. Should any such fact or condition
require any change in this Agreement or the Exhibits attached to this
Agreement, Sellers will promptly deliver to Buyer a supplement to this
Agreement or the Exhibits attached hereto specifying such change. During the
same period, each Seller will promptly notify Buyer of the occurrence of any
Breach of any covenant of Sellers in this Section or of the occurrence of any
event that may make the satisfaction of the conditions to closing set forth
in this Agreement impossible or unlikely.
4.6 PAYMENT OF INDEBTEDNESS BY RELATED PERSONS. Except as
expressly provided in this Agreement, Sellers will cause all indebtedness
owed to the Company by either Seller or any related person of either Seller
to be paid in full prior to Closing.
4.7 NO NEGOTIATION. Until such time, if any, as this Agreement is
terminated, Sellers will not, and will cause the Company and each of their
representatives not to, directly or indirectly solicit, initiate, or
encourage any inquiries or proposals from, discuss or negotiate with, provide
any non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any person (other than Buyer) relating to any
transaction involving the sale of the business or assets (other than in the
ordinary course of business) of the Company, or any of the capital stock of
the Company, or any merger, consolidation, business combination, or similar
transaction involving the Company.
4.8 BEST EFFORTS. Between the date of this Agreement and the
Closing Date, Sellers will use their best efforts to cause the conditions to
closing set forth in this Agreement to be satisfied.
5. COVENANTS OF BUYER PRIOR TO CLOSING DATE
5.1 APPROVALS OF GOVERNMENTAL AUTHORITIES. As promptly as
practicable after the date of this Agreement, Buyer will make all filings and
obtain all consents required by applicable laws and regulations in order to
consummate the transactions contemplated hereby.
5.2 BEST EFFORTS. Between the date of this Agreement and the
Closing Date, Buyer will use its best efforts to cause the conditions in
Sections 6 and 7 to be satisfied.
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6. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Shares and to take the other actions
required to be taken by Buyer at the Closing is subject to the satisfaction,
at or prior to the Closing, of each of the following conditions (any of which
may be waived by Buyer, in whole or in part):
6.1 ACCURACY OF REPRESENTATIONS. All of Sellers' representations
and warranties in this Agreement (considered collectively), and each of these
representations and warranties (considered individually), must have been
accurate in all material respects as of the date of this Agreement, and must
be accurate in all material respects as of the Closing Date as if made on the
Closing Date.
6.2 SELLERS' PERFORMANCE. All of the covenants and obligations
that Sellers is required to perform or to comply with pursuant to this
Agreement at or prior to the Closing (considered collectively), and each of
these covenants and obligations (considered individually), must have been
duly performed and complied with in all material respects. Sellers must have
delivered each of the documents required to be delivered by Sellers pursuant
to Section 1.5.1.
6.3 CONSENTS. Each of the consents required to consummate the
transactions contemplated hereby must have been obtained and must be in full
force and effect.
6.4 NO PROCEEDINGS. Since the date of this Agreement, there must
not have been commenced or threatened against Buyer, or against any person
affiliated with Buyer, any proceeding (a) involving any challenge to, or
seeking damages or other relief in connection with, any of the transactions
contemplated hereby, or (b) that may have the effect of preventing, delaying,
making illegal, or otherwise interfering with any of the transactions
contemplated hereby.
6.5 NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS. There
must not have been made or threatened by any person any claim asserting that
such person (a) is the holder or the beneficial owner of, or has the right to
acquire or to obtain beneficial ownership of, any stock of, or any other
voting, equity, or ownership interest in the Company, or (b) is entitled to
all or any portion of the purchase price payable for the Shares.
6.6 NO PROHIBITION. Neither the consummation nor the performance
of any of the transactions contemplated hereby will, directly or indirectly
(with or without notice or lapse of time), materially contravene, or conflict
with, or result in a material violation of, or cause Buyer or any person
affiliated with Buyer to suffer any material adverse consequence under, any
applicable laws or regulations.
7. CONDITIONS PRECEDENT TO SELLERS' OBLIGATION TO CLOSE
Sellers' obligation to sell the Shares and to take the other actions
required to be taken by Sellers at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Sellers, in whole or in part):
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7.1 ACCURACY OF REPRESENTATIONS. All of Buyer's representations
and warranties in this Agreement (considered collectively), and each of these
representations and warranties (considered individually), must have been
accurate in all material respects as of the date of this Agreement and must
be accurate in all material respects as of the Closing Date as if made on the
Closing Date.
7.2 BUYER'S PERFORMANCE. All of the covenants and obligations
that Buyer is required to perform or to comply with pursuant to this
Agreement at or prior to the Closing (considered collectively), and each of
these covenants and obligations (considered individually), must have been
performed and complied with in all material respects. Buyer must have
delivered each of the documents required to be delivered by Buyer pursuant to
Section 1.5.2 and must have made the cash payments required to be made by
Buyer pursuant to Section 1.5.2.
7.3 CONSENTS. All of the consents required to be obtained from
Buyer must have been obtained and must be in full force and effect.
7.4 NO PROHIBITION. Neither the consummation nor the performance
of any of the transactions contemplated hereby will, directly or indirectly
(with or without notice or lapse of time), materially contravene, or conflict
with, or result in a material violation of, or cause Sellers or any person
affiliated with Sellers to suffer any material adverse consequence under, any
applicable laws or regulations.
8. TERMINATION
8.1 TERMINATION EVENTS. This Agreement may, by notice given prior
to or at the Closing, be terminated:
(a) by either Buyer or Sellers if a material breach of any
provision of this Agreement has been committed by the other party and such
breach has not been waived;
(b) (i) by Buyer if any of the conditions in Section 6 has not
been satisfied as of the Closing Date or if satisfaction of such a condition
is or becomes impossible (other than through the failure of Buyer to comply
with its obligations under this Agreement) and Buyer has not waived such
condition on or before the Closing Date; or (ii) by Sellers, if any of the
conditions in Section 7 has not been satisfied as of the Closing Date or if
satisfaction of such a condition is or becomes impossible (other than
through the failure of Sellers to comply with their obligations under this
Agreement) and Sellers has not waived such condition on or before the
Closing Date; or
(c) by mutual consent of Buyer and Sellers.
8.2 EFFECT OF TERMINATION. Each party's right of termination under
Section 8.1 is in addition to any other rights it may have under this Agreement
or otherwise, and the exercise of a right
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of termination will not be an election of remedies. If this Agreement is
terminated pursuant to Section 8.1, all further obligations of the parties
under this Agreement will terminate, except that the obligations in Sections
10.1 and 10.3 will survive; provided, however, that if this Agreement is
terminated by a party because of the breach of the Agreement by the other
party or because one or more of the conditions to the terminating party's
obligations under this Agreement is not satisfied as a result of the other
party's failure to comply with its obligations under this Agreement, the
terminating party's right to pursue all legal remedies will survive such
termination unimpaired.
9. INDEMNIFICATION; REMEDIES
9.1 SURVIVAL; RIGHT TO INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE.
All representations, warranties, covenants, and obligations in this Agreement
and the Exhibits attached hereto, will survive the Closing. The right to
indemnification, payment of damages or other remedy based on such
representations, warranties, covenants, and obligations will not be affected
by any investigation conducted with respect to, or any knowledge acquired (or
capable of being acquired) at any time, whether before or after the execution
and delivery of this Agreement or the Closing Date, with respect to the
accuracy or inaccuracy of or compliance with, any such representation,
warranty, covenant, or obligation. The waiver of any condition based on the
accuracy of any representation or warranty, or on the performance of or
compliance with any covenant or obligation, will not affect the right to
indemnification, payment of damages, or other remedy based on such
representations, warranties, covenants, and obligations.
9.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS. Sellers,
jointly and severally, will indemnify and hold harmless Buyer, the Company,
and their respective representatives, stockholders, controlling persons, and
affiliates (collectively, the "Indemnified Persons") for, and will pay to the
Indemnified Persons the amount of, any loss, liability, claim, damage
(including incidental and consequential damages), expense (including costs of
investigation and defense and reasonable attorneys' fees) or diminution of
value, whether or not involving a third-party claim (collectively,
"Damages"), arising, directly or indirectly, from or in connection with:
(a) any and all loss, liability or damage suffered or incurred by
Buyer in respect of any debt, obligation or liability of the Company or of
Seller not disclosed in this Agreement, any of the Exhibits attached hereto,
or in writing to Buyer prior to the Closing Date;
(b) any breach of any representation or warranty made by Sellers in
this Agreement, the Exhibits attached hereto, or any other certificate or
document delivered by Sellers pursuant to this Agreement;
(c) any breach of any representation or warranty made by Sellers in
this Agreement as if such representation or warranty were made on and as of
the Closing Date;
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(d) any Breach by either Seller of any covenant or obligation of such
Seller in this Agreement;
(e) any claim by any Person for brokerage or finder's fees or
commissions or similar payments based upon any agreement or understanding
alleged to have been made by any such Person with either Seller or the
Company (or any person acting on their behalf) in connection with any of the
transactions contemplated hereby.
The remedies provided in this Section 9.2 will not be exclusive of or limit
any other remedies that may be available to Buyer or the other Indemnified
Persons.
9.3 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will
indemnify and hold harmless Sellers, and will pay to Sellers the amount of
any damages arising, directly or indirectly, from or in connection with (a)
any breach of any representation or warranty made by Buyer in this Agreement
or in any certificate delivered by Buyer pursuant to this Agreement, (b) any
breach by Buyer of any covenant or obligation of Buyer in this Agreement, or
(c) any claim by any person for brokerage or finder's fees or commissions or
similar payments based upon any agreement or understanding alleged to have
been made by such person with Buyer (or any person acting on its behalf) in
connection with any of the transactions contemplated hereby.
10. GENERAL PROVISIONS
10.1 EXPENSES. Except as otherwise expressly provided in this
Agreement, each party to this Agreement will bear its respective expenses
incurred in connection with the preparation, execution, and performance of
this Agreement and the transactions contemplated hereby, including all fees
and expenses of agents, representatives, counsel, and accountants. In the
event of termination of this Agreement, the obligation of each party to pay
its own expenses will be subject to any rights of such party arising from a
breach of this Agreement by another party.
10.2 PUBLIC ANNOUNCEMENTS. Any public announcement or similar
publicity with respect to this Agreement or the Contemplated Transactions
will be issued, if at all, at such time and in such manner as the parties
mutually agree. Sellers and Buyer will consult with each other concerning the
means by which the Company's employees, customers, and suppliers and others
having dealings with the Company will be informed of the transactions
contemplated hereby.
10.3 CONFIDENTIALITY. Between the date of this Agreement and the
Closing Date, Buyer and Sellers will maintain in confidence, and will cause
the directors, officers, employees, agents, and advisors of Buyer and the
Company to maintain in confidence, any written, oral, or other information
obtained in confidence from another party or the Company in connection with
this Agreement or the transactions contemplated hereby, unless (a) such
information is already known to such party or to others not bound by a duty
of confidentiality or such information becomes publicly available through no
fault of such party, (b) the use of such information is necessary or
appropriate in making any filing or obtaining any consent or approval
required for the consummation of the transactions contemplated
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hereby, or (c) the furnishing or use of such information is required by or
necessary or appropriate in connection with legal proceedings. If the
transactions contemplated hereby are not consummated, each party will return
or destroy as much of such written information as the other party may
reasonably request.
10.4 NOTICES. All notices, consents, waivers, and other
communications under this Agreement must be in writing and will be deemed to
have been duly given when (a) delivered by hand (with written confirmation of
receipt), (b) sent by telecopier (with written confirmation of receipt),
provided that a copy is mailed by registered mail, return receipt requested,
or (c) when received by the addressee, if sent by a nationally recognized
overnight delivery service (receipt requested), in each case to the
appropriate addresses and telecopier numbers set forth below (or to such
other addresses and telecopier numbers as a party may designate by notice to
the other parties):
Sellers:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Phone: (303)
Fax: (303)
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Phone: (303)
Fax: (303)
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Buyer:
Venturi Technologies, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman and CEO
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(With a copy to ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chief Counsel)
14
10.5 JURISDICTION; SERVICE OF PROCESS. Any action or proceeding
seeking to enforce any provision of, or based on any right arising out of,
this Agreement may be brought against any of the parties in the courts of the
State of Utah, County of Salt Lake, or, if it has or can acquire
jurisdiction, in the United States District Court for the Central District of
Utah, and each of the parties consents to the jurisdiction of such courts
(and of the appropriate appellate courts) in any such action or proceeding
and waives any objection to venue laid therein. Process in any action or
proceeding referred to in the preceding sentence may be served on any party
anywhere in the world.
10.6 FURTHER ASSURANCES. The parties agree (a) to furnish upon
request to each other such further information, (b) to execute and deliver to
each other such other documents, and (c) to do such other acts and things,
all as the other party may reasonably request for the purpose of carrying out
the intent of this Agreement and the documents referred to in this Agreement.
10.7 WAIVER. The rights and remedies of the parties to this
Agreement are cumulative and not alternative. Neither the failure nor any
delay by any party in exercising any right, power, or privilege under this
Agreement or the documents referred to in this Agreement will operate as a
waiver of such right, power, or privilege, and no single or partial exercise
of any such right, power, or privilege will preclude any other or further
exercise of such right, power, or privilege or the exercise of any other
right, power, or privilege. To the maximum extent permitted by applicable
law, (a) no claim or right arising out of this Agreement or the documents
referred to in this Agreement can be discharged by one party, in whole or in
part, by a waiver or renunciation of the claim or right unless in writing
signed by the other party; (b) no waiver that may be given by a party will be
applicable except in the specific instance for which it is given; and (c) no
notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
10.8 ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes
all prior agreements between the parties with respect to its subject matter
(including the Letter of Intent between Buyer and Sellers dated August 4,
1999) and constitutes (along with the documents referred to in this
Agreement) a complete and exclusive statement of the terms of the agreement
between the parties with respect to its subject matter. This Agreement may
not be amended except by a written agreement executed by the party to be
charged with the amendment.
10.9 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. Neither
party may assign any of its rights under this Agreement without the prior
consent of the other parties, except that Buyer may assign any of its rights
under this Agreement to any Subsidiary of Buyer. Subject to the preceding
sentence, this Agreement will apply to, be binding in all respects upon, and
inure to the benefit of the successors and permitted assigns of the parties.
Nothing expressed or referred to in this Agreement will be construed to give
any person other than the parties to this Agreement any legal or equitable
right, remedy, or claim under or with respect to this Agreement or any
provision of this Agreement. This Agreement and all of its provisions and
conditions are for the sole and exclusive benefit of the parties to this
Agreement and their successors and assigns.
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10.10 SEVERABILITY. If any provision of this Agreement is held
invalid or unenforceable by any court of competent jurisdiction, the other
provisions of this Agreement will remain in full force and effect. Any
provision of this Agreement held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held invalid or
unenforceable.
10.11 SECTION HEADINGS, CONSTRUCTION. The headings of Sections in
this Agreement are provided for convenience only and will not affect its
construction or interpretation. All references to "Section" or "Sections"
refer to the corresponding Section or Sections of this Agreement. All words
used in this Agreement will be construed to be of such gender or number as
the circumstances require. Unless otherwise expressly provided, the word
"including" does not limit the preceding words or terms.
10.12 TIME OF ESSENCE. With regard to all dates and time periods
set forth or referred to in this Agreement, time is of the essence.
10.13 GOVERNING LAW. This Agreement will be governed by the laws of
the State of Utah without regard to conflicts of laws principles.
10.14 TAX ELECTIONS. Sellers acknowledge that the Buyer may, in its
sole discretion, make certain tax elections with respect to this transaction,
including, but not necessarily limited to, an election under Section 338 of
the Internal Revenue Code of 1986, as amended, to treat this transaction for
tax purposes as though it were a purchase and sale of assets rather than
stock.
10.15 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
10.16 The Parties agree that with each disbursement or release from
Escrow that upon instructions all payments on the Note may be made directly
to the constituent parties comprising the Seller Entities. VTI further
agrees to forward a photocopy of all checks or wire transfer debits made to
the Escrow Agent.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first written above.
BUYER:
VENTURI TECHNOLOGIES, INC.
a Nevada corporation
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------
Its: CEO
---------------------
16
STATE OF )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this 25th day of
October, 1999, by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ of VENTURI TECHNOLOGIES, INC., a Nevada
corporation.
Witness my hand and official seal.
My commission expires: 5-15-2001.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
[SEAL] -------------------------
Notary Public
17
SELLERS:
ALL FOURS DISTRIBUTING, INC.,
a Colorado corporation
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, V.P.
-------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
STATE OF COLORADO )
) ss.
COUNTY OF ▇▇▇▇▇ )
The foregoing instrument was acknowledged before me this 19th day of
October, 1999, by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President, and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice
President of ALL FOURS DISTRIBUTING, INC., a Colorado corporation, general
partner of MPI OF NEVADA, a Colorado general partnership.
Witness my hand and official seal.
My commission expires: 3/20/2003.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
[SEAL] -------------------------
Notary Public
18
STATE OF )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me this _____ day of
October, 1999, by ▇▇▇▇▇ ▇▇▇▇▇▇.
Witness my hand and official seal.
My commission expires: ___________________________.
-------------------------
Notary Public
19