Stock Purchase Agreement
by and among
Star Computing, Ltd.,
a Nevada corporation
on the one hand
and
Hi-Tech Environmental Products, LLC,
a Nevada limited liability company d/b/a
VitroCo
and
Vitroco Materials, LLC,
a Nevada limited liability company
and
VitroTech Corporation,
a Delaware corporation
and
All of the shareholders of
VitroTech Corporation,
a Delaware corporation
on the other hand
Dated as of February 3, 2004
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is dated as of February 3, 2004,
by and among Star Computing Ltd., a publicly traded Nevada corporation (OTCBB:
SRCU) ("Star"), and ▇▇▇▇▇ ▇. Poland, an individual stockholder of Star (the
"Star Stockholder") on the one hand, and Hi-Tech Environmental Products, LLC, a
Nevada limited liability company d/b/a VitroCo ("Hi-Tech"), VitroCo Materials,
LLC, a Nevada limited liability company ("VitroCo"), VitroTech Corporation, a
Delaware corporation ("VitroTech") and all of the shareholders of VitroTech
(collectively, the "VitroTech Shareholders") on the other hand. Hi-Tech and the
VitroTech Shareholders are collectively referred to herein as the "Purchasers,"
each a "Purchaser."
RECITALS
A. Star and the Purchasers have each determined to engage in the
transaction contemplated hereby (the "Stock Purchase") pursuant to which each of
the Purchasers will make certain contributions of assets as set forth herein in
exchange for shares of the common stock of Star and the assumption by Star of
certain liabilities of the Purchasers, as set forth herein.
B. The board of directors of Star and the managing member of Hi-Tech have
each approved this Agreement and the Stock Purchase.
C. The parties intend that the transactions contemplated in this Agreement
constitute capital contributions by all the Purchasers as a group to Star in
exchange for controlling equity interest in Star within the meaning of Section
351 of the Internal Revenue Code of 1986, as amended (the "Code"), and the
regulations promulgated thereunder.
D. The Star Stockholder, VitroTech Corporation and VitroCo are parties to
this Agreement for the purpose of making certain representations and warranties.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and in reliance upon the representations and warranties
hereinafter set forth, the parties hereto hereby agree as follows:
ARTICLE 1
DEFINITIONS
As used herein, the following terms shall have the following meanings:
"Agreement" has the meaning specified in the introductory paragraph above.
"Assumed Liabilities" has the meaning specified in Section 2.2 hereof.
"Closing" has the meaning specified in Article 3 hereof.
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"Closing Date" has the meaning specified in Article 3 hereof.
"Code" means the Internal Revenue Code of 1986, as amended.
"Contracts" has the meaning specified in Section 4.15 hereof.
"Disclosure Schedule" has the meaning specified in Article 4 hereof.
"Employee" means a regular employee on the payroll of VitroCo.
"Encumbrance" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest, conditional sale agreement, financing
statement or encumbrance of any kind, or any other type of preferential
arrangement that has the practical effect of creating a security interest in
respect of such asset.
"Indemnified Party" has the meaning specified in Article 6 hereof.
"Indemnifying Party" has the meaning specified in Article 6 hereof.
"Intellectual Property" means all of the service marks, copyrights,
franchises, software, patents, licenses, trademarks, trade names, jingles,
slogans, logotypes and other similar intangible assets maintained, owned, used,
held for use or otherwise held or licensed by VitroCo in connection with the
business of VitroCo (including any and all applications, registrations,
extensions and renewals relating thereto), and all of the rights, benefits and
privileges associated therewith.
"LTSB" has the meaning specified in Section 5.7 hereof.
"Licensed Intellectual Property" has the meaning specified in Section
4.13(c) hereof.
"Person" means a natural person, corporation, partnership or other
business entity, or any Governmental Entity.
"Real Property" has the meaning specified in Section 4.9 hereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Star" has the meaning specified in the introductory paragraph above.
"Star's Audited Financials" has the meaning specified in Section 5.7(b)
hereof.
"Star's Balance Sheet" has the meaning specified in Section 5.7(b) hereof.
"Star's Financial Statements" has the meaning specified in Section 5.7(c)
hereof.
"Star's Interim Financials" has the meaning specified in Section 5.7(b)
hereof.
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"Star Shares" means the common stock, par value $.001 per share, of Star
issued pursuant to this Agreement.
"Tax" and "Taxes" shall mean all federal, state, local and foreign
property, sales and use, payroll, withholding, franchise and income taxes and
all assessments, rates, levies, fees and other governmental charges, including
any interest and penalties in respect of such amounts.
"Trading Day" shall mean means (i) a day on which Star's common stock is
traded on a Trading Market, or (ii) if Star's common stock is not listed on a
Trading Market, a day on which the Star's common stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding its functions of
reporting prices); provided, that in the event that Star's common stock is not
listed or quoted as set forth in (i) and (ii) hereof, then Trading Day shall
mean a business day.
"Trading Market" means the following markets or exchanges on which the
Star's common stock may be listed or quoted for trading on the date in question:
the OTC Bulletin Board, the American Stock Exchange, the New York Stock
Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.
"Vitro Financial Statements" has the meaning specified in Section 4.3
hereof.
"Unaudited Balance Sheet" has the meaning specified in Section 5.7(b)
hereof.
ARTICLE 2
PURCHASE AND SALE; ASSUMPTION OF LIABILITIES
2.1 Purchase and Sale. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties contained
herein, at the Closing, each Purchaser shall purchase from the Star, and Star
shall issue and sell Star Shares to each Purchaser as follows:
(a) 15,000,000 Star Shares to Hi-Tech in exchange for all of the
membership interest in VitroCo Materials, LLC, a Nevada limited liability
company ("VitroCo"); and
(b) an aggregate of 14,875,000 Star Shares to the VitroTech
Shareholders, to be allocated among them as set forth in Exhibit "A," attached
hereto in exchange for all of the common stock of VitroTech held by the
VitroTech Shareholders.
2.2 Assumption of Liabilities. As part of the consideration for the sale
of the Star Shares as set forth in Section 2.1 hereof, Star shall assume, on the
date of Closing, and hereby agrees to pay, perform and discharge the liabilities
of VitroCo set forth in Exhibit "B," attached hereto (the "Assumed
Liabilities").
2.3 Delivery Free of Encumbrances. The Star Shares issued pursuant to
Section 2.1 hereof shall be issued by Star free and clear of any Encumbrances
and shall be fully paid and non-assessable.
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2.4 Restrictions On Transferability Of Star Shares. The Star Shares to be
issued and delivered pursuant to this Agreement in accordance with the
provisions hereof will not have been registered under the Securities Act or
under the securities laws of any state. Accordingly, the Star Shares (together
with any other shares received pursuant to conversions, exchanges, stock splits,
stock dividends or other reclassifications or changes thereof, or consolidations
or reorganizations of Star) will not be transferable except upon the conditions
specified in this Agreement, which conditions are intended to insure compliance
with the provisions of the Securities Act in respect of any transfer thereof.
2.5 Legend. Each certificate representing Star Shares issued hereunder
shall be stamped or otherwise imprinted with a legend in the following form:
3.1.
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR UNDER THE SECURITIES LAWS OF ANY STATE. SUCH SECURITIES MAY NOT
BE SOLD OR OFFERED FOR SALE OR OTHERWISE HYPOTHECATED OR DISTRIBUTED
EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH
SECURITIES UNDER THE ACT, OR (B) PURSUANT TO A VALID EXEMPTION FROM
SUCH REGISTRATION UNDER THE ACT AND UNDER THE SECURITIES LAW OF ANY
STATE AND UPON RECEIPT BY STAR COMPUTING, LTD OF AN OPINION OF
COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO IT THAT ANY SUCH SALE
IS IN COMPLIANCE WITH, OR NOT SUBJECT TO, THE ACT AND STATE
SECURITIES LAWS."
Where applicable, upon written request, Star shall remove such
legends so as to facilitate the sale of such shares, if and to the extent
applicable, pursuant to Rule 144 under the Act, provided (in the case of Rule
144 sales) that upon request of removal of legends, the person making such
request shall have provided such documentation as Star and its transfer agent
shall reasonably require in connection therewith.
2.6 Press Releases. At the Closing, Star shall issue such press release or
announcement of the transactions contemplated by this Agreement as may be
required by the reporting requirements of the Exchange Act, subject to the
applicable requirements of Rules 13-5a and 13-5c under the Securities Act, and
such release or announcement will be reasonably satisfactory in form and
substance to VitroCo and VitroTech and their counsel. Star shall not issue any
other press release or otherwise make public any information with respect to
this Agreement or the transactions contemplated hereby, prior to the Closing,
without the prior written consent of VitroCo and VitroTech which consent shall
not be unreasonably withheld. Notwithstanding the foregoing, if required by law,
Star may issue such a press release or otherwise make public such information as
long as Star notifies VitroCo and VitroTech of such requirement and discusses
with VitroCo and VitroTech in good faith the contents of such disclosure.
2.7 Redemption. At Closing, Star shall cause to be redeemed 6,043,496
shares of its outstanding common stock from certain stockholders.
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ARTICLE 3
THE CLOSING
Subject to the satisfaction of the conditions and closing deliveries
specified in Article 9 hereof, the closing of the Stock Purchase shall take
place at 11:00 a.m. (Pacific Time) at the offices of ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, on or before February 3, 2004 (the
"Closing Date"), or at such other time and date as the parties may mutually
agree (the "Closing").
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
HI-TECH, VITROCO AND VITROTECH
Except as set forth under the corresponding section of the disclosure
schedule delivered to Star concurrently herewith (the "Disclosure Schedule"),
which Disclosure Schedule shall be deemed a part hereof, Hi-Tech and VitroCo
(with respect to matters relating to Hi-Tech and VitroCo only) and the VitroTech
Shareholders (with respect to matters relating to VitroTech only), as
applicable, hereby represent and warrant to Star as follows:
4.1 Organization. Each of Hi-Tech and VitroCo is a limited liability
company duly organized, validly existing and in good standing under the laws of
the state of its organization, and has the requisite power to carry on its
business as now conducted. VitroTech is a corporation duly organized, validly
existing and in good standing under the laws of the state of its incorporation,
and has the requisite corporate power to carry on its business as now conducted.
4.2 Certain Matters. Each of Hi-Tech, VitroCo and VitroTech is duly
licensed or qualified to do business and is in good standing as a foreign
corporation in every jurisdiction in which the character of its properties or
nature of its business requires it to be so licensed or qualified other than
such jurisdictions in which the failure to be so licensed or qualified does not,
or insofar as can reasonably be foreseen, in the future will not, have a
material adverse effect on its financial condition, results of operations or
business. Each of Hi-Tech, VitroCo and VitroTech has full power and authority
and all authorizations, consents, licenses and permits necessary to carry on the
business in which it is engaged or in which it proposes presently to engage and
to own and use the properties owned and used by it. Each of Hi-Tech and VitroCo
has delivered to Star a true, accurate and complete copy of its Articles of
Organization and Limited Liability Operating Agreement, which reflect all
restatements of and amendments made thereto at any time prior to the date of
this Agreement. The membership records of VitroCo and the member list of VitroCo
furnished to Star are complete and correct in all material respects and
accurately reflect the record ownership and the beneficial ownership of all the
outstanding membership interests of VitroCo. Hi-Tech is the sole member of
VitroCo. No person, other than Hi-Tech is entitled to receive Star Shares due to
such person's ownership of securities of VitroCo. Neither Hi-Tech nor VitroCo is
in default under or in violation of any provision of its Articles of
Organization or respective operating agreements in any material respect. VitroCo
is not in any material default or in violation of any restriction, lien,
encumbrance, indenture, contract, lease, sublease, loan agreement, note or other
obligation or liability by which it is bound or to which any of its assets is
subject, except as disclosed in the Vitro Financial Statement. VitroTech has
delivered to Star true, accurate and complete copies of its Certificate of
Incorporation and Bylaws, which reflect all restatements of and amendments made
thereto at any time prior to the date of this Agreement. The records of meetings
of the stockholders and Boards of Directors of VitroTech furnished to Star are
complete and correct in all material respects. The stock records of VitroTech
and the stockholder list of VitroTech furnished to Star and are complete and
correct in all material respects and accurately reflect the record ownership and
the beneficial ownership of all the outstanding shares of VitroTech's capital
stock and any other outstanding securities issued by VitroTech. VitroTech is not
in default under or in violation of any provision of its Certificate of
Incorporation or Bylaws in any material respect. VitroTech is not in any
material default or in violation of any restriction, lien, encumbrance,
indenture, contract, lease, sublease, loan agreement, note or other obligation
or liability by which it is bound or to which any of its assets is subject,
except as disclosed in the Vitro Financial Statement.
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4.3 Authority Relative to this Agreement. Each of Hi-Tech, VitroCo and the
VitroTech Shareholders has the requisite power and/or authority to enter into
this Agreement and carry out its/his/her obligations hereunder. The execution,
delivery and performance of this Agreement by Hi-Tech and VitroCo and the
consummation of the transactions contemplated hereby have been duly authorized
by the managing member and sole member, respectively, of Hi-Tech and VitroCo and
no other action on the part of Hi-Tech or VitroCo are necessary to authorize
this Agreement or the transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered by Hi-Tech, VitroCo and VitroTech
Shareholders and constitutes a valid and binding obligation of Hi-Tech, VitroCo
and VitroTech Shareholders, enforceable in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity.
4.4 Consents and Approvals; No Violations. Except for applicable
requirements of federal securities laws and state securities or blue-sky laws,
no filing with, and no permit, authorization, consent or approval of, any third
party, public body or authority is necessary for the consummation by Hi-Tech or
the VitroTech Shareholders of the transactions contemplated by this Agreement.
Neither the execution and delivery of this Agreement by Hi-Tech and VitroCo nor
the consummation by Hi-Tech of the transactions contemplated hereby, nor
compliance by Hi-Tech and VitroCo with any of the provisions hereof, will (a)
conflict with or result in any breach of any provisions of their respective
Articles of Organization or operating agreements, (b) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, agreement or other instrument or obligation to
which Hi-Tech or VitroCo is a party or by which it or any of its properties or
assets may be bound, or (c) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to Hi-Tech or VitroCo, or any of its
properties or assets, except in the case of clauses (b) and (c) for violations,
breaches or defaults which are not in the aggregate material to either Hi-Tech
or VitroCo taken as a whole. Neither the execution and delivery of this
Agreement by VitroTech Shareholders nor the consummation by VitroTech
Shareholders of the transactions contemplated hereby, nor compliance by
VitroTech Shareholders with any of the provisions hereof, will (a) conflict with
or result in any breach of any provisions of VitroTech's Certificate of
Incorporation, (b) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, agreement or other instrument or obligation to which the VitroTech
Shareholders is a party or by which it or any of its properties or assets may be
bound, or (c) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to VitroTech Shareholders or VitroTech, or any of
VitroTech's properties or assets, except in the case of clauses (b) and (c) for
violations, breaches or defaults which are not in the aggregate material to
either VitroTech Shareholders or VitroTech taken as a whole.
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4.5 Financial Statements.
(a) Each of Hi-Tech, VitroCo and VitroTech shall deliver to Star an
unaudited balance sheet as at Decemebr 31, 2003 and January 28, 2004 and related
income statement for calendar year 2003 and for the period beginning on January
1, 2004 through January 28, 2004 (the "Vitro Financial Statements").
(b) The Vitro Financial Statements, (i) are complete and correct in
all material respects, (ii) have been prepared on a financial statement basis,
(iii) fairly and accurately present in all material respects the financial
positions of Hi-Tech, VitroCo and VitroTech, as applicable, as at the dates
thereof.
There have not been any changes in accounting methods, estimates or
principles (for financial accounting purposes) at any time since the Financial
Statements, which have been made, agreed to or required with respect to either
Hi-Tech, VitroCo or VitroTech.
4.6 Events Subsequent to Financial Statements. Since the Vitro Financial
Statements (i.e., January 28, 2004), there has not been:
(a) any sale, lease, transfer, license or assignment of any assets,
tangible or intangible, of Hi-Tech, VitroCo or VitroTech, except for Hi-Tech's
transfer of assets to VitroCo as capital contributions to Vitro or in the
ordinary course of their businesses;
(b) any damage, destruction or property loss, whether or not covered
by insurance, affecting adversely the properties or business of Hi-Tech, VitroCo
or VitroTech;
(c) any declaration or setting aside or payment of any distribution
with respect to the membership interests of Hi-Tech or VitroCo or with respect
to the stock of VitroTech, or any redemption, purchase or other acquisition of
any such membership interests or stock;
(d) except for the issuance of membership interests in Hi-Tech to
Value Plus, LLC, any issuance of membership interest or the granting, issuance
or execution of any rights, options or other commitments by Hi-Tech or VitroCo,
as the case may be, relating to its membership interests or any issuance of
stock or the granting, issuance or execution of any rights, options or other
commitments by VitroTech, as the case may be, relating to its stock;
(e) any subjection to any lien on any of the assets, tangible or
intangible, of VitroCo or VitroTech;
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(f) any incurrence of indebtedness or liability or assumption of
obligations by VitroCo or VitroTech other than VitroCo's assumption of certain
obligations of Hi-Tech as part of Hi-Tech's capitalization of VitroCo or in the
ordinary course of their businesses;
(g) any waiver or release by VitroCo or VitroTech of any right of
any material value;
(h) any compensation or benefits paid to officers, directors or
members of VitroCo or VitroTech;
(i) any change made or authorized in the Articles of Organization or
Operating Agreement of VitroCo or any change made or authorized in the
Certificate of Incorporation or Bylaws of VitroTech;
(j) any damage, destruction or loss from fire, water, accident or
other such casualty (whether or not covered by insurance) to any of VitroCo's or
VitroTech's property or assets;
(k) any loan to or other transaction with any officer or member of
VitroCo giving rise to any claim or right of VitroCo against any such person or
of such person against VitroCo or any loan to or other transaction with any
officer or director of VitroTech giving rise to any claim or right of VitroTech
against any such person or of such person against VitroTech;
(l) any merger or consolidation with or acquisition of an interest
in any Person or acquired a substantial portion of the assets or business of any
Person or any division or line of business thereof;
(m) any mortgage, pledge or grant of a security interest in any of
VitroCo or VitroTech's material assets, tangible or intangible;
(n) any writing down or writing up the value of any of VitroCo's or
VitroTech's assets (or failed to write down or write up any asset inconsistent
with the past practice) or write off as uncollectible any of VitroCo's or
VitroTech's account receivable, except write-downs and write-offs in the
ordinary course of business, none of which, individually or in the aggregate,
are material;
(o) any loan made to or any guarantee of the indebtedness (of any
kind) of any Person;
(p) any material change in the customary operating methods of
VitroCo or VitroTech, including policies and practices relating to pricing,
selling and marketing;
(q) any settlement or compromise of any litigation in which VitroCo
or VitroTech is a party to that would otherwise have been required to be
disclosed pursuant to this Agreement;
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(r) any failure to renew any of VitroCo's insurance policies that is
scheduled to terminate or expire within sixty (60) calendar days after the
Closing Date;
(s) any abandoning or allowing to lapse any Intellectual Property
(or any registration or application in respect thereof); or
(t) any material adverse change in the condition (financial or
otherwise) of the properties, assets, liabilities or business of VitroCo or
VitroTech.
4.7 Undisclosed Liabilities. Except as otherwise disclosed in the Vitro
Financial Statements, neither Hi-Tech, VitroCo nor VitroTech have any material
liability or obligation whatsoever, either direct or indirect, matured or
unmatured, accrued, absolute, contingent or otherwise.
4.8 Tax Matters.
(a) Each of VitroCo and VitroTech has duly filed all material
federal, state, local and foreign tax returns required to be filed by or with
respect to it with the Internal Revenue Service or other applicable taxing
authority, and no extensions with respect to such tax returns have been
requested or granted;
(b) Each of VitroCo and VitroTech has paid, or adequately reserved
against in VitroCo's and VitroTech's financial statements, all material taxes
due, or claimed by any taxing authority to be due, from or with respect to it;
(c) To the best knowledge of Hi-Tech and VitroCo, there has been no
material issue raised or material adjustment proposed (and none is pending) by
the Internal Revenue Service or any other taxing authority in connection with
any of VitroCo's tax returns;
(d) To the best knowledge of the VitroTech Shareholders, there has
been no material issue raised or material adjustment proposed (and none is
pending) by the Internal Revenue Service or any other taxing authority in
connection with any of VitroTech's tax returns; and
(e) No waiver or extension of any statute of limitations as to any
material federal, state, local or foreign tax matter has been given by or
requested from VitroCo or VitroTech.
For the purposes of this Section 4.8, a tax is due (and must
therefore either be paid or adequately reserved against in VitroCo's or
VitroTech's financial statements) only on the last date payment of such tax can
be made without interest or penalties, whether such payment is due in respect of
estimated taxes, withholding taxes, required tax credits or any other tax.
4.9 Real Property.
(a) VitroCo has delivered to Star an accurate and complete list and
description of all real property leased, occupied or used by VitroCo (the "Real
Property"), which list specifies the owner of each such Real Property. All Real
Property is suitable and adequate for the purposes for which it is currently
being used. All the Real Property is occupied under a valid and current
certificate of occupancy or similar permit, and the transactions contemplated by
this Agreement will not require the issuance of any new or amended certificate
or permit.
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(b) VitroCo does not own any Real Property. VitroTech does not own,
lease, occupy or use any Real Property.
(c) VitroCo has delivered to Star accurate and complete copies all
leases and subleases (including, without limitation, all amendments, consents
for alterations and documents recording variations and evidence of commencement
dates and expiration dates) pursuant to which any of the Real Property is
occupied or used by VitroCo. Each such lease and sublease is in full force and
effect and constitutes a legal, valid and binding obligation of, and is legally
enforceable against, the respective parties thereto and grants the leasehold
interest it purports to grant free and clear of all Encumbrances. VitroCo has
complied with all of the material provisions of such leases and subleases and is
not in default thereunder in any material respect, and there has not occurred
any event which (whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute such a default. VitroCo has
not received any notice of cancellation or termination under such lease or
sublease or any notice of a breach or default thereunder, which breach or
default has not been cured, and no lessor has any right of termination or
cancellation under such lease or sublease except upon a breach or default by
VitroCo thereunder. The consummation of the transactions contemplated by this
Agreement will not (i) cause any such lease or sublease to cease to be legal,
binding and in full force and effect on terms identical to those currently in
effect or (ii) constitute a breach or default under such lease or sublease or
otherwise give the landlord the right to terminate such lease or sublease. The
rental set forth in each lease or sublease is the actual rental being paid, and
there are no separate understandings or agreement with respect to the same.
(d) None of the Real Property or any leasehold interest in the Real
Property is subject to any contract or other restriction of any nature
whatsoever (recorded or unrecorded) preventing or limiting VitroCo's right to
convey or to use it or to be in peaceful and undisturbed possession of each
parcel of Real Property. VitroCo has not leased or subleased any parcel or
portion of any parcel of Real Property (including office or commercial space) to
any other Person, nor has VitroCo assigned its interest under any lease or
sublease to any other Person.
(e) No portion of the Real Property or any building, structure,
fixture or improvement thereon is the subject of, or affected by, any
condemnation, eminent domain or inverse condemnation proceeding currently
instituted or pending, and VitroCo has no knowledge that any of the foregoing
are, or will be, the subject of, or affected by, any such proceeding.
4.10 Books and Records. VitroCo's and VitroTech's books and records have
been delivered to Star prior to the Closing fully and fairly reflect the
transactions to which VitroCo and VitroTech is a party or by which it or its
properties are bound.
4.11 Questionable Payments. Neither VitroCo nor VitroTech, nor any of
their respective employees, agents or representatives has, directly or
indirectly, made any bribes, kickbacks, illegal payments or illegal political
contributions using VitroCo or VitroTech funds or made any payments from
VitroCo's or VitroTech's funds to governmental officials for improper purposes
or made any illegal payments from VitroCo's or VitroTech's funds to obtain or
retain business.
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4.12 Environmental Matters.
(a) Definitions. For the purpose of this Agreement, the following
terms shall have the meaning herein specified:
(i) "Governmental Authority" shall mean the United States,
each state, each county, each city and each other political subdivision in which
Hi-Tech's, VitroCo's or VitroTech's business, as applicable, is located, and any
court, political subdivision, agency or instrumentality with jurisdiction over
Hi-Tech's, VitroCo's or VitroTech's business, as applicable.
(ii) "Environmental Laws" shall mean (A) the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended by
the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.A. 9601 et
seq. ("CERCLA"), (B) the Resource Conservation and Recovery Act, as amended by
the Hazardous and Solid Waste Amendment of 1984, 42 U.S.C.A. 6901 et seq.
("RCRA"), (C) the Clean Air Act, 42 U.S.C.A. 7401 et seq., (D) the Federal Water
Pollution Control Act, as amended, 33 U.S.C.A. 1251 et seq., (E) the Toxic
Substances Control Act, 15 U.S.C.A. 2601 et seq., (F) all applicable state laws,
and (G) all other laws and ordinances relating to municipal waste, solid waste,
air pollution, water pollution and/or the handling, discharge, disposal or
recovery of on-site or off-site hazardous substances or materials, as each of
the foregoing has been or may hereafter be amended from time to time.
(iii) "Hazardous Materials" shall mean, among others, (A) any
"hazardous waste" as defined by RCRA, and regulations promulgated thereunder;
(B) any "hazardous substance" as defined by CERCLA, and regulations promulgated
thereunder; (C) any "toxic pollutant" as defined in the Federal Water Pollution
Prevention and Control Act, as amended, 33 U.S.C. 1251 et seq., (commonly known
as "CWA" for "Clean Water Act"), and any regulations thereunder; (D) any
"hazardous air pollutant" as defined in the Air Pollution Prevention and Control
Act, as amended, 42 U.S.C. 7401 et seq. (commonly known as "CAA" for "Clean Air
Act") and any regulations thereunder; (E) asbestos; (F) polychlorinated
biphenyls; (G) any substance the presence of which at the Business Location (as
hereinafter defined) is prohibited by any Environmental Laws; and (H) any other
substance which is regulated by any Environmental Laws.
(iv) "Hazardous Materials Contamination" shall mean the
presence of Hazardous Materials in the soil, groundwater, air or any other media
regulated by the Environmental Laws on, under or around Hi-Tech's, VitroCo's or
VitroTech's facilities, as applicable, at levels or concentration which trigger
any requirement under the Environmental Laws to remove, remediate, mitigate,
▇▇▇▇▇ or otherwise reduce the level or concentration of the Hazardous Materials.
The term "Hazardous Materials Contamination" does not include the presence of
Hazardous Materials in process tanks, lines, storage or reactor vessels,
delivery trucks or any other equipment or containers, which Hazardous Materials
are used in the manufacture, processing, distribution, use, storage, sale,
handling, transportation, recycling, reuse or disposal of the products that were
manufactured and/or distributed by Hi-Tech, VitroCo or VitroTech, as applicable.
(v) "Business Location" shall mean any real property,
building, facility or structure owned, leased or occupied by Hi-Tech, VitroCo or
VitroTech, as applicable, at any time from its inception until the present.
-11-
(b) Representations and Warranties. Based on the foregoing, Hi-Tech,
VitroCo and VitroTech represent and warrant that:
(i) To the knowledge of Hi-Tech, VitroCo and VitroTech, after
due investigation, there has been no material failure by Hi-Tech, VitroCo or
VitroTech to comply with all applicable requirements of Environmental Laws
relating to Hi-Tech, VitroCo or VitroTech and their respective operations,
manufacture, processing, distribution, use, treatment, generation, recycling,
reuses, sale, storage, handling, transportation or disposal of any Hazardous
Material and Hi-Tech, VitroCo and VitroTech are not aware of any facts or
circumstances which could materially impair such compliance with all applicable
Environmental Laws.
(ii) Hi-Tech, VitroCo and VitroTech have not received notice
from any Governmental Authority or any other person of any actual or alleged
violation of any Environmental Laws, nor is any such notice anticipated.
(iii) Except as provided in Schedule 4.12, to the knowledge of
Hi-Tech, VitroCo and VitroTech, after due investigation, Environmental Laws do
not require that any permits, licenses or similar authorizations to construct,
occupy or operate any equipment or facilities used in the conduct of Hi-Tech,
VitroCo or VitroTech's business.
(iv) No Hazardous Materials are now located at the Business
Location, and, to the knowledge of Hi-Tech, VitroCo and VitroTech, after due
investigation, neither Hi-Tech, VitroCo or VitroTech has ever caused or
permitted any Hazardous Materials to be generated, placed, stored, held,
handled, located or used at the Business Location, except those which may
lawfully be used, transported, stored, held, handled, generated or placed at the
Business Location in the conduct of Hi-Tech, VitroCo or VitroTech's business.
(v) Hi-Tech, VitroCo or VitroTech have not received any
notices, whether from a Governmental Authority or some other third party, that
Hazardous Material Contamination exists at the Business Location or at any other
location utilized by Hi-Tech, VitroCo or VitroTech in the conduct of any of
their respective businesses nor is Hi-Tech, VitroCo or VitroTech aware of any
circumstances that would give rise to an allegation of such contamination.
(vi) To the knowledge of Hi-Tech, VitroCo or VitroTech, after
due investigation, no investigation, administrative order, consent order or
agreement, litigation or settlement with respect to Hazardous Materials or
Hazardous Materials Contamination is proposed, threatened, anticipated, pending
or otherwise in existence with respect to the Business Location or with respect
to any other site controlled or utilized by Hi-Tech, VitroCo or VitroTech in the
operation of their respective businesses. To the knowledge of Hi-Tech, VitroCo
or VitroTech, after due investigation, no Business Location is currently on, and
has never been on, any federal or state "Superfund" or "Superlien" list.
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4.13 Intellectual Property.
(a) VitroCo has delivered to Star a true, correct and complete
listing, and brief description of all Intellectual Property owned or licensed by
or registered in the name of VitroCo or used or held for use in the business of
VitroCo. The Company owns or possesses all rights to use all such Intellectual
Property necessary to the conduct of the business of VitroCo and all such
Intellectual Property is free and clear of any Encumbrance. VitroCo has not
received any notice to the effect that (i) the conduct of business by VitroCo
may infringe on any intellectual property right or other legally protectable
right of another, or (ii) any Person is using any patents, copyrights,
trademarks, service marks, trade names, trade secrets or similar property that
are confusingly similar with Intellectual Property owned by VitroCo. VitroCo has
not granted any license or other right to any other Person with respect to
Intellectual Property owned by VitroCo. The consummation of the transactions
contemplated by this Agreement will not result in the termination or impairment
of any of the Intellectual Property owned by VitroCo. VitroTech does not own,
license or use any Intellectual Property.
(b) VitroCo is not aware of any reason that would prevent any
pending trademark, service ▇▇▇▇, copyright, patent or other Intellectual
Property applications from having registration granted. (c) Any Intellectual
Property which is licensed or sublicensed to VitroCo ("Licensed Intellectual
Property") has so been identified to Star. With respect to Licensed Intellectual
Property, (i) VitroCo has delivered to Star correct and complete copies of all
the licenses and sublicenses (and all applicable amendments and ancillary
documents) for such Licensed Intellectual Property, (ii) all such licenses and
sublicenses are in full force and effect and represent the entire agreement
between licensor and licensee with respect to the Intellectual Property being
licensed, (iii) the consummation of the transaction contemplated by this
Agreement will not cause any such license or sublicense to cease to be valid and
binding, nor will it constitute a breach or default under any such license or
sublicense or result in the licensor or sublicensor being given the right to
terminate such license or sublicense, (iv) neither Hi-Tech nor VitroCo have
received (or has reason to believe that it will receive) a notice of termination
or cancellation under such license or sublicense, and no licensor or sublicensor
has any right to terminate any Licensed Intellectual Property, except in the
event of default thereunder, (v) neither Hi-Tech nor VitroCo are in material
breach or default of and have not received (and do not have any reason to
believe that it will receive) a notice that it is in material breach or default
of any Licensed Intellectual Property, (vi) no claims or other actions have been
made or asserted (nor have been threatened) against Hi-Tech or VitroCo either
based upon Hi-Tech's or VitroCo's use of the Licensed Intellectual Property or
alleging that any Licensed Intellectual Property is being licensed, sublicensed
or used in violation of the rights of any third party, and (vii) no Person is
using any patents, copyrights, trademarks, service marks, trade names, trade
secrets or similar property that infringe upon or are confusingly similar with
any Licensed Intellectual Property.
4.14 Insurance. VitroCo has delivered to Star a list of all insurance
policies currently carried by VitroCo. Such insurance policies are in full force
and effect and will continue to be in full force and effect up to and including
the Closing Date. VitroCo is the sole owner of each such policy. All premiums
due on such policies or renewals thereof have been timely paid. Copies of all
insurance policies have been delivered to Star. All such policies: (i) are, and
at the time of the Closing, shall be in full force and effect; (ii) are
sufficient for compliance in all material respects by VitroCo with all
requirements of law and of all agreements to which VitroCo is a party; (iii) are
valid, outstanding, and enforceable policies, and no party to any policy has
repudiated, or given notice of an intent to repudiate, any provision thereof;
and (iv) insure against risks of the kind customarily insured against and in
amounts customarily carried by companies similarly situated and provide adequate
insurance coverage for VitroCo (including the business and operations thereof).
VitroCo is not in breach or default, and no event has occurred (including,
without limitation, the failure to pay any premiums) which with notice or lapse
of time, would constitute a breach or default or permit modification or
termination, under the policy. VitroTech does not have any insurance policies in
effect.
-13-
4.15 Contracts. VitroCo has delivered to Star copies of each and every:
(a) contract or series of related contracts in excess of $25,000 or
contract for future services which requires the payment by VitroCo of $25,000
annually and is not terminable without penalty upon 30 days (or less) notice;
(b) contract for the employment of any key employee (including
employment letters and offer letters);
(c) VitroCo bonus, incentive, deferred compensation, severance pay,
pension, profit-sharing, retirement, stock purchase, stock option, stock
incentive hospitalization, employees' insurance or other plan (including
insurance policies on the life of any of VitroCo's employee or employees),
agreement or arrangement providing employee benefits;
(d) collective bargaining agreement or other agreements or awards
between VitroCo and any labor union;
(e) lease to which VitroCo is a party (i) which is not terminable
without penalty on notice of 30 days or less with respect to personal property
involving an annual rental payment of $25,000 or more, or (ii) with respect to
any real property, whether as lessor or lessee;
(f) chattel mortgage or conditional sales agreement to which VitroCo
is a party involving $25,000 or more;
(g) agreement between VitroCo and any Person (including any
employee) relating to sharing of past, present or future commissions, fees,
▇▇▇▇▇▇▇▇, revenue, income or profits;
(h) agreement or arrangement with any supplier in which any key
employee has any ownership interest (other than shares in a publicly owned
company) or participation in income or profits; or
(i) material agreement of VitroCo not made in the ordinary course of
business.
All of the foregoing are referred to as the "Contracts." The copies
of each of the Contracts delivered are accurate and complete. Each Contract is
in full force and effect and constitutes a legal, valid and binding obligation
of, and is legally enforceable against, the respective parties thereto. There is
no material default with respect to any such contract which will give rise to
liability in respect thereof on the part of VitroCo or the other parties
thereto. No notice of default or similar notice has been given or received by
VitroCo under any of such contracts. VitroTech is not a party to any Contracts.
-14-
4.16 Litigation. Neither VitroCo nor VitroTech is subject to any judgment
or order of any court or quasijudicial or administrative agency of any
jurisdiction, domestic or foreign, nor is there any charge, complaint, lawsuit
or governmental investigation pending against VitroCo or VitroTech. Neither
VitroCo nor VitroTech is a plaintiff in any action, domestic or foreign,
judicial or administrative. There are no existing actions, suits, proceedings
against or investigations of VitroCo or VitroTech, and neither VitroCo nor
VitroTech knows of any basis for such actions, suits, proceedings or
investigations. There are no unsatisfied judgments, orders, decrees or
stipulations affecting VitroCo or VitroTech or to which VitroCo or VitroTech is
a party.
4.17 Employees. VitroCo will deliver to Star a complete and accurate list
of all employees of VitroCo, setting forth their respective names, current
positions, salaries and other remuneration and benefits as of the date hereof.
Copies of all employment and consulting agreements to which VitroCo is a party
have been delivered to Star. All compensation and other amounts payable to
employees as of the date hereof were paid or will be paid in accordance with
VitroCo's normal payroll practices. No bonuses have been paid or accrued to any
employee since the date of the Vitro Financial Statements. To the best knowledge
of Hi-Tech and VitroCo, no present or former employee of VitroCo has any claim
against VitroCo on account of or for (a) overtime pay (other than overtime pay
for the current payroll period), (b) wages, salary or other compensation for any
period (other than the current payroll period), (c) vacation, sick leave, or
time off, other than that earned in the current fiscal year (which amounts will
be accrued on the Closing Financial Statements), (d) severance pay or (e) any
violation of statute, ordinance or regulation relating to minimum wages, maximum
hours of work, termination of employment or similar matters. VitroCo is not a
party to or bound by any collective bargaining agreement. There are no loans or
other obligations payable or owing by VitroCo to any stockholder, officer,
director or employee of VitroCo, nor are there any loans or debts payable or
owing by any of such persons to VitroCo or any guarantees by VitroCo of any loan
or obligation of any nature to which any such person is a party. VitroTech does
not have any employees.
4.18 Employee Benefit Plans. VitroCo has delivered to Star copies of
VitroCo's employee benefit plans. All such plans are in material compliance with
all applicable federal, state and local laws, regulations, ordinances, codes and
other legally binding rules, and are not subject to any present or threatened
claim that they are, may be or have been administered contrary to any federal,
state or local laws, regulations, ordinances, codes or other legally binding
rules. VitroTech does not have any employee benefit plans.
4.19 Legal Compliance. To the best knowledge of VitroCo and Hi-Tech, after
due investigation, no claim has been filed against VitroCo alleging a violation
of any applicable laws and regulations of foreign, federal, state and local
governments and all agencies thereof. VitroCo holds all of the material permits,
licenses, certificates or other authorizations of foreign, federal, state or
local governmental agencies required for the conduct of its business as
presently conducted. To the best knowledge of the VitroTech Shareholders, after
due investigation, no claim has been filed against VitroTech alleging a
violation of any applicable laws and regulations of foreign, federal, state and
local governments and all agencies thereof. VitroTech holds all of the material
permits, licenses, certificates or other authorizations of foreign, federal,
state or local governmental agencies required for the conduct of its business as
presently conducted.
-15-
4.20 No Subsidiaries. Neither VitroCo nor VitroTech owns any capital stock
or have any interest in any corporation, partnership, or other form of business
organization.
4.21 Broker's Fees. Neither Hi-Tech, VitroCo nor the VitroTech
Shareholders, nor anyone on their behalf has any liability to any broker,
finder, investment banker or agent, or has agreed to pay any brokerage fees,
finder's fees or commissions, or to reimburse any expenses of any broker,
finder, investment banker or agent in connection with this Agreement.
4.22 No Disagreements with Accountants and Lawyers. Except for those
claims by Hi-Tech against Price, ▇▇▇▇ and ▇▇▇▇ & ▇▇▇▇, there are no
disagreements of any kind presently existing, or reasonably anticipated by
Hi-Tech, VitroCo or VitroTech to arise, between the accountants and lawyers
formerly or presently employed by Hi-Tech, VitroCo or VitroTech and HiTech,
VitroCo and VitroTech are current with respect to any fees owed to its
accountants and lawyers.
4.23 Title to Properties, Liens and Encumbrances. VitroCo and VitroTech
have good title to all properties, interests in properties and assets reflected
in the Vitro Financial Statements or acquired thereafter, free and clear of all
Encumbrances. Such assets and properties include all tangible and intangible
assets, contracts and rights necessary or required for the operation of the
business of VitroCo and VitroTech as now or heretofore conducted. All material
tangible assets of VitroCo and VitroTech are in good operating condition and
repair, subject to normal wear and tear, free of defects, latent or patent, and
are suitable, adequate and fit for the uses for which they are intended or being
used; and such assets and the present use thereof do not violate in any material
respect any applicable licenses, statutes, engineering standards or building,
fire, zoning, health and safety or any other laws, with the exception of the
Valley Springs property, which does not yet have permits to mine.
4.24 Leased Equipment. VitroCo has delivered to Star a list of all
equipment, other than personal property and fixtures, valued in excess of
$10,000 licensed to or held under similar arrangements, or are in the possession
or custody of VitroCo. VitroTech does not own or lease any equipment.
4.25 Accounts Receivable. VitroCo has delivered to Star a true, correct
and complete list of all Accounts Receivables, including an aging thereof as of
the Closing Date. All Accounts Receivables (whether billed, unbilled or accrued)
arose in the ordinary and usual course of VitroCo's business, represent valid
obligations due, and either have been collected in full or VitroCo has no reason
to believe that such accounts will not be collected in full within ninety (90)
days after the Closing Date, in the aggregate amounts reflected thereon, with
the exception of the receivables from Seegott, Inc. and Pivot-▇▇▇▇▇▇. VitroTech
does not have any Accounts Receivables.
-16-
4.26 Bank Accounts. Each of VitroCo and VitroTech has delivered to Star a
complete list of (i) the names and locations of all financial institutions at
which VitroCo and VitroTech maintain checking accounts, deposit accounts,
securities accounts, safety deposit boxes or other deposits or safekeeping
arrangements, the numbers or other identification of all such accounts and
arrangement and the names of all persons authorized to draw against any funds
therein and (ii) the names of all Persons holding powers of attorney from
VitroCo and VitroTech. At the time of the Closing, no additional Person will
have been authorized, from the date hereof, to draw on or have access to any
such accounts or deposits or hold any power of attorney from VitroCo or
VitroTech. All monies and accounts of VitroCo and VitroTech shall be held by,
and be accessible only to, VitroCo and VitroTech at the time of the Closing.
4.27 True Copies. All copies of documents delivered or made available to
Star by Hi-Tech, VitroCo or VitroTech in connection with this Agreement are true
and correct copies of the originals thereof.
4.28 Capitalization. Hi-Tech owns all of the membership interest in
VitroCo. The authorized capital stock of VitroTech consists of 50,000,000 shares
of common stock, par value $0.001 per share, of which 14,873,000 shares are and
at the Closing will be issued and outstanding. All of the outstanding membership
interest in VitroCo and issued and outstanding shares of capital stock of
VitroTech are duly authorized, validly issued, fully paid, non-assessable and
free of preemptive rights. There are no outstanding or authorized options,
rights, warrants, calls, convertible securities, rights to subscribe, conversion
rights or other agreements or commitments to which VitroTech or VitroCo is a
party or which are binding upon VitroTech or VitroCo providing for the issuance
or transfer by VitroTech or VitroCo of additional shares of its capital stock or
additional membership interests, respectively and VitroTech has not reserved any
shares of its capital stock for issuance, nor are there any outstanding stock
option rights, phantom equity or similar rights, contracts, arrangements or
commitments which are binding upon VitroTech. There are no voting trusts or any
other agreements or understandings with respect to the voting of VitroTech's
capital stock.
4.29 Litigation and Governmental Enforcement. To the best knowledge of
Vitroco and VitroTech, neither they nor any of their affiliates, officers,
directors or shareholders owning 5% or over of its capital stock is a party to
any action, suit, arbitration, legal or administrative proceeding or
investigation pending or threatened against it by any federal, state, municipal
or governmental body, including, but not limited to, the SEC nor are they acting
on behalf of such governmental bodies. To the best knowledge of Vitroco and
VitroTech, neither they nor any of their affiliates, officers, directors or
shareholders owning 5% or over of each entities capital stock have ever been
fined, sanctioned, disciplined or imprisoned for any securities violation. There
is no judgment, order, writ, injunction or decree of any court, governmental
agency, tribunal or other governmental or regulatory authority as to which any
of the assets, properties or business of Vitroco or VitroTech or any of their
affiliates, officers, directors or shareholders owning 5% or over of its capital
stock is subject, and Vitroco and VitroTech knows of no basis for such actions,
suits, proceedings or investigations. Vitroco and VitroTech agree to immediately
provide Star with written notification of any inquiry by any of the
aforementioned regulatory bodies should they receive notice of same prior to the
Closing.
-17-
4.30 Affiliate Transactions. Except as disclosed in Schedule 4.30, (a) no
officer or director of Vitroco or VitroTech has any significant interest in any
entity that is engaged in a business which is in competition with the business
of Vitroco or VitroTech and (b) no officer or director of Vitroco or VitroTech
is a supplier to, or a customer of Vitroco or VitroTech, or is a party to any
contract.
4.31 Securities Law Compliance. Each of Vitroco and VitroTech has, on a
timely basis, made any and all appropriate filings required by any applicable
SEC rules and regulations and state securities laws ("Blue Sky Laws") in any
jurisdiction where Vitroco and VitroTech has offered, sold or distributed its
membership interests or shares of its common stock, respectively. Upon request,
Vitroco and VitroTech shall be required to furnish in writing to Star all
information within Vitroco's and VitroTech's possession or knowledge required by
the applicable rules and regulations of the SEC and by any applicable state
securities laws concerning the method of sale, distribution or other disposition
of VitroTech common stock to its shareholders.
4.32 Disclosure. The representations and warranties and statements of fact
made by Hi-Tech, VitroCo and VitroTech Shareholders in this Agreement are, as
applicable, accurate, correct and complete and do not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements and information contained herein not false or
misleading.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
OF STAR AND STAR STOCKHOLDER
Except as set forth under the corresponding section of the disclosure
schedule delivered to VitroCo concurrently herewith (the "Disclosure Schedule"),
which Disclosure Schedule shall be deemed a part hereof, Star and the Star
Stockholder hereby represent and warrant, jointly and severally, to Hi-Tech,
VitroCo, VitroTech Shareholders as follows:
5.1 Organization. Star is a corporation duly organized, validly existing
and in good standing under the laws of the state of its incorporation, and has
the requisite corporate power to carry on its business as now conducted.
5.2 Capitalization. Star's authorized capital stock consists of 50,000,000
shares of capital stock, all of which are designated as Common Stock, of which
11,043,496 shares are issued and outstanding and of which 5,000,000 will be
issued and outstanding at the Closing. All issued and outstanding shares of
capital stock of Star are duly authorized, validly issued, fully paid,
non-assessable and free of preemptive rights. When issued, the Star Shares will
be duly authorized, validly issued, fully paid, non-assessable and free of
preemptive rights, there are no outstanding or authorized options, rights,
warrants, calls, convertible securities, rights to subscribe, conversion rights
or other agreements or commitments to which Star is a party or which are binding
upon Star providing for the issuance by Star or transfer by Star of additional
shares of Star's capital stock and Star has not reserved any shares of its
capital stock for issuance, nor are there any outstanding stock option rights,
phantom equity or similar rights, contracts, arrangements or commitments to
issue capital stock of Star. There are no voting trusts or any other agreements
or understandings with respect to the voting of Star's capital stock.
-18-
5.3 Certain Corporate Matters. Star is duly licensed or qualified to do
business and is in good standing as a foreign corporation in every jurisdiction
in which the character of its properties or nature of its business requires it
to be so licensed or qualified other than such jurisdictions in which the
failure to be so licensed or qualified does not, or insofar as can reasonably be
foreseen, in the future will not, have a material adverse effect on its
financial condition, results of operations or business. Star has full corporate
power and authority and all authorizations, licenses and permits necessary to
carry on the business in which it is engaged or in which it proposes presently
to engage and to own and use the properties owned and used by it. Star has
delivered to each of the Purchasers true, accurate and complete copies of its
Articles of Incorporation and Bylaws, which reflect all restatements of and
amendments made thereto at any time prior to the date of this Agreement. The
records of meetings of the stockholders and Boards of Directors of Star
previously furnished to the Purchasers are complete and correct in all material
respects. The stock records of Star and the stockholder lists of Star furnished
to Purchasers are complete and correct in all material respects and accurately
reflect the record ownership and the beneficial ownership of all the outstanding
shares of Star's capital stock and any other outstanding securities issued by
Star. Star is not in default under or in violation of any provision of its
Articles of Incorporation or Bylaws in any material respect. Star is not in any
material default or in violation of any restriction, lien, encumbrance,
indenture, contract, lease, sublease, loan agreement, note or other obligation
or liability by which it is bound or to which any of its assets is subject. Star
has delivered to the Purchasers a complete copy of Star's financial records and
tax returns from Star's inception to the Closing Date.
5.4 Authority Relative to this Agreement. Each of Star and the Star
Stockholder has the requisite corporate power and authority to enter into this
Agreement and to carry out its/his obligations hereunder. The execution,
delivery and performance of this Agreement by Star and the consummation of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of Star and no other actions on the part of Star is necessary to
authorize this Agreement or the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Star and the Star
Stockholder and constitutes a valid and binding obligation of Star and the Star
Stockholder, enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity.
5.5 Consents and Approvals; No Violations. Except for applicable
requirements of federal securities laws and state securities or blue-sky laws,
no filing with, and no permit, authorization, consent or approval of, any third
party, public body or authority is necessary for the consummation by Star of the
transactions contemplated by this Agreement. Neither the execution and delivery
of this Agreement by Star nor the consummation by Star of the transactions
contemplated hereby, nor compliance by Star with any of the provisions hereof,
will (a) conflict with or result in any breach of any provisions of the charter
or Bylaws of Star, (b) result in a violation or breach of, or constitute (with
or without due notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, agreement or other instrument or obligation to which Star or the Star
Stockholder is a party or by which it or any of its properties or assets may be
bound, or (c) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Star, or any of its properties or assets, except in the
case of clauses (b) and (c) for violations, breaches or defaults which are not
in the aggregate material to Star taken as a whole.
-19-
5.6 SEC Documents. Star has filed all reports required to be filed by it
under the Securities Act and the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), including pursuant to Section 13(a) or 15(d) thereof, for
the two years preceding the date hereof (or such shorter period as Star was
required by law to file such material) (the foregoing materials, including the
exhibits thereto, being collectively referred to herein as the "SEC Reports") on
a timely basis or has received a valid extension of such time of filing and has
filed any such SEC Reports prior to the expiration of any such extension. As of
their respective dates, the SEC Documents complied in all material respects with
the requirements of the Exchange Act and the rules and regulations promulgated
thereunder and none of the SEC Documents contained an untrue statement of a
material fact or omitted to state 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. The financial statements of Star included
in the SEC Documents comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto, have been prepared in accordance with generally accepted
accounting principles in the United States (except, in the case of unaudited
statements, as permitted by the applicable form under the Exchange Act) applied
on a consistent basis during the periods involved (except as may be indicated in
the notes thereto) and fairly present the financial position of Star as of the
dates thereof and its statements of operations, stockholders' equity and cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal and recurring year-end audit adjustments which were and are not
expected to have a material adverse effect on Star, its business, financial
condition or results of operations). Except as and to the extent set forth on
the balance sheet of Star as of December 31, 2003, including the notes thereto,
Star does not have any liability or obligation of any nature (whether accrued,
absolute, contingent or otherwise and whether required to be reflected on a
balance sheet or not).
5.7 Financial Statements.
(a) Included in the SEC Documents are the audited balance sheets of
Star as at December 31, 2002 and 2001, and the related statements of operations,
changes in stockholders' equity and cash flows for the year ended December 31,
2002, and the periods July 16, 2001 (inception) through December 31, 2001 and
July 16, 2001 (inception) through December 31, 2002, together with the
unqualified report thereon of Lesley, Thomas, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Inc.,, a
Professional Accountancy Corporation ("LTSP"), independent auditor
(collectively, "Star's Audited Financials").
(b) Included in the SEC Documents are the unaudited consolidated
balance sheets of Star as at September 30, 2003, and the related statements of
operations and cash flows for the twelve months ended September 30, 2003, as
reviewed by LTSP ("Star's Interim Financials"). The unaudited balance sheet at
September 30, 2003 included in Star's Interim Financials is hereinafter referred
to as the "Unaudited Balance Sheet" and December 31, 2003 is hereinafter
referred to as the "Star Balance Sheet Date."
(c) Star's Audited Financials and Star's Interim Financials
(collectively "Star's Financial Statements") are (i) in accordance with the
books and records of Star, (ii) correct and complete, (iii) fairly present the
financial position and results of operations of Star as of the dates indicated,
and (iv) prepared in accordance with U.S. GAAP (except that (x) unaudited
financial statements may not be in accordance with GAAP because of the absence
of footnotes normally contained therein, and (y) interim (unaudited) financials
are subject to normal year-end audit adjustments that in the aggregate will not
have a material adverse effect on Star or its businesses, financial conditions
or results of operations.
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5.8 Events Subsequent to Financial Statements. Since December 31, 2002,
there has not been any material adverse change in the condition (financial or
otherwise) of the properties, assets, liabilities or business of Star, except
changes in the ordinary course of business that, individually and in the
aggregate, have not been materially adverse.
5.9 Undisclosed Liabilities. Except as otherwise disclosed in Star's
Financial Statements, Star does not have any material liability or obligation
whatsoever, either direct or indirect, matured or unmatured, accrued, absolute,
contingent or otherwise.
5.10 Tax Matters.
(a) Star has duly filed all material federal, state, local and
foreign tax returns required to be filed by or with respect to it with the
Internal Revenue Service or other applicable taxing authority, and no extensions
with respect to such tax returns have been requested or granted;
(b) Star has paid, or adequately reserved against in Star's
Financial Statements, all material taxes due, or claimed by any taxing authority
to be due, from or with respect to it;
(c) To the best knowledge of Star, there has been no material issue
raised or material adjustment proposed (and none is pending) by the Internal
Revenue Service or any other taxing authority in connection with any of Star's
tax returns; and
(d) No waiver or extension of any statute of limitations as to any
material federal, state, local or foreign tax matter has been given by or
requested from Star.
For the purposes of this Section 5.10, a tax is due (and must
therefore either be paid or adequately reserved against in Star's Financial
Statements) only on the last date payment of such tax can be made without
interest or penalties, whether such payment is due in respect of estimated
taxes, withholding taxes, required tax credits or any other tax.
5.11 Real Property. Star does not own or lease any real property.
5.12 Books and Records. The corporate and financial books and records of
Star delivered to the Purchasers prior to the Closing fully and fairly reflect
the transactions to which Star is a party or by which it or its properties are
bound.
5.13 Questionable Payments. Star, or any of its employees, agents or
representatives, have, directly or indirectly, made any bribes, kickbacks,
illegal payments or illegal political contributions using Star's funds or made
any payments from Star's funds to governmental officials for improper purposes
or made any illegal payments from Star's funds to obtain or retain business.
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5.14 Environmental Matters. Neither Star nor the Star Stockholder have
received notice of nor are they aware of any environmental matters which could
have a material adverse effect on the assets or operations of Star.
5.15 Intellectual Property. Star does not own or use any trademarks, trade
names, service marks, patents, copyrights or any applications with respect
thereto. Star does not have any knowledge of any claim that, or inquiry as to
whether, any product, activity or operation of Star infringes upon or involves,
or has resulted in the infringement of, any trademarks, trade-names, service
marks, patents, copyrights or other proprietary rights of any other person,
corporation or other entity; and no proceedings have been instituted, are
pending or are threatened.
5.16 Insurance. Star does not have any insurance policies in effect.
5.17 Contracts. Star does not have any material contracts, leases,
arrangements or commitments (whether oral or written). Star is not a party to or
bound by or affected by any contract, lease, arrangement or commitment (whether
oral or written) relating to: (a) the employment of any person; (b) collective
bargaining with, or any representation of any employees by, any labor union or
association; (c) the acquisition of services, supplies, equipment or other
personal property; (d) the purchase or sale of real property; (e) distribution,
agency or construction; (f) lease of real or personal property as lessor or
lessee or sublessor or sublessee; (g) lending or advancing of funds; (h)
borrowing of funds or receipt of credit; (i) incurring any obligation or
liability; or (j) the sale of personal property.
5.18 Litigation. Star is not subject to any judgment or order of any court
or quasijudicial or administrative agency of any jurisdiction, domestic or
foreign, nor is there any charge, complaint, lawsuit or governmental
investigation pending against Star. Star is not a plaintiff in any action,
domestic or foreign, judicial or administrative. There are no existing actions,
suits, proceedings against or investigations of Star, and neither Star nor the
Star Stockholder knows of any basis for such actions, suits, proceedings or
investigations. There are no unsatisfied judgments, orders, decrees or
stipulations affecting Star or to which Star is a party.
5.19 Employees. Star has no employees. Star does not owe any compensation
of any kind, deferred or otherwise, to any current or previous employees. Star
has no written or oral employment agreements with any officer or director of
Star. Star is not a party to or bound by any collective bargaining agreement.
There are no loans or other obligations payable or owing by Star to any
stockholder, officer, director or employee of Star, nor are there any loans or
debts payable or owing by any of such persons to Star or any guarantees by Star
of any loan or obligation of any nature to which any such person is a party.
5.20 Employee Benefit Plans. Star does not have any (a) non-qualified
deferred or incentive compensation or retirement plans or arrangements, (b)
qualified retirement plans or arrangements, (c) other employee compensation,
severance or termination pay or welfare benefit plans, programs or arrangements
or (d) any related trusts, insurance contracts or other funding arrangements
maintained, established or contributed to by Star.
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5.21 Legal Compliance. To the best knowledge of Star and the Star
Stockholder, after due investigation, no claim has been filed against Star
alleging a violation of any applicable laws and regulations of foreign, federal,
state and local governments and all agencies thereof. Star holds all of the
material permits, licenses, certificates or other authorizations of foreign,
federal, state or local governmental agencies required for the conduct of its
business as presently conducted.
5.22 No Subsidiaries. Star does not own any capital stock or have any
interest in any corporation, partnership, or other form of business
organization.
5.23 Broker's Fees. Neither Star, nor anyone on its behalf has any
liability to any broker, finder, investment banker or agent, or has agreed to
pay any brokerage fees, finder's fees or commissions, or to reimburse any
expenses of any broker, finder, investment banker or agent in connection with
this Agreement.
5.24 Registration Rights. Star has not granted or agreed to grant to any
person or entity any rights (including "piggy back" registration rights) to have
any securities of Star registered with the Securities and Exchange Commission or
any other governmental authority that have not been satisfied.
5.25 Listing and Maintenance Requirements. Star has not, in the 12 months
preceding the date hereof, received notice from the trading market or stock
quotation system on which Star's Common Stock is listed or quoted to the effect
that Star is not in compliance with the listing or maintenance requirements of
such trading market or stock quotation system. Star is, and has no reason to
believe that it will not in the foreseeable future continue to be, in compliance
with all such listing and maintenance requirements.
5.26 No Disagreements with Accountants and Lawyers. There are no
disagreements of any kind presently existing, or reasonably anticipated by Star
to arise, between the accountants and lawyers formerly or presently employed by
Star and Star is current with respect to any fees owed to its accountants and
lawyers.
5.27 Securities Law Compliance. Star has, on a timely basis, made any and
all appropriate filings required by any applicable SEC rules and regulations and
Blue Sky Laws in any jurisdiction where Star has offered, sold or distributed
shares of its common stock, and Star and the Star Stockholder represents and
warrants that:
(a) All issued and outstanding shares of Star' stock have been
offered, sold or otherwise distributed in a manner compliant with any and all
applicable SEC regulations or state securities laws, and that Star shall, upon
request, be required to furnish in writing to Hi-Tech or VitroTech all
information within Star's possession or knowledge required by the applicable
rules and regulations of the SEC and by any applicable state securities laws
concerning the method of sale, distribution or other disposition of Star common
stock to its shareholders, including but not limited to the identity of, and
compensation to be paid to, any proposed underwriter(s) that may have been
employed or utilized in connection therewith;
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(b) To the best of the knowledge of Star and the Star Stockholder,
there is no order preventing or suspending the sale or trading of the securities
of Star that has been issued by the Securities and Exchange Commission or any
similar regulatory agency and Star is not aware of any justification for such an
order to be issued.
5.28 Title to Properties, Liens and Encumbrances. Star has good title to
all properties, interests in properties and assets reflected in the Star
Financial Statements or acquired thereafter, free and clear of all Encumbrances.
Such assets and properties include all tangible and intangible assets, contracts
and rights necessary or required for the operation of the business of Star as
now or heretofore conducted. All material tangible assets of Star are in good
operating condition and repair, subject to normal wear and tear, free of
defects, latent or patent, and are suitable, adequate and fit for the uses for
which they are intended or being used; and such assets and the present use
thereof do not violate in any material respect any applicable licenses,
statutes, engineering standards or building, fire, zoning, health and safety or
any other laws.
5.29 Accounts Receivable. Star does not have any Accounts Receivables.
5.30 Bank Accounts. Star has delivered to Hi-Tech or VitroTech a complete
list of (i) the names and locations of all financial institutions at which Star
maintains checking accounts, deposit accounts, securities accounts, safety
deposit boxes or other deposits or safekeeping arrangements, the numbers or
other identification of all such accounts and arrangement and the names of all
persons authorized to draw against any funds therein and (ii) the names of all
Persons holding powers of attorney from Star. At the time of the Closing, no
additional Person will have been authorized, from the date hereof, to draw on or
have access to any such accounts or deposits or hold any power of attorney from
Star. All monies and accounts of Star shall be held by, and be accessible only
to, Star at the time of the Closing.
5.31 True Copies. All copies of documents delivered or made available to
Hi-Tech, VitroCo or VitroTech from Star in connection with this Agreement are
true and correct copies of the originals thereof.
5.32 Disclosure. The representations and warranties and statements of fact
made by Star, and the Star Stockholder in this Agreement are, as applicable,
accurate, correct and complete and do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements and information contained herein not false or misleading.
ARTICLE 6
INDEMNIFICATION
6.1 Indemnification. Except for the Star Stockholder, each party to this
Agreement ("Indemnifying Party") will indemnify and hold the other parties and
their directors, officers, shareholders, partners, employees and agents (each,
an "Indemnified Party") harmless from any and all losses, liabilities,
obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys'
fees and costs of investigation that any such Indemnified Party may suffer or
incur as a result of or relating to any misrepresentation, breach or inaccuracy,
of any of the representations, warranties, covenants or agreements made by the
Indemnifying Party in this Agreement. If any action shall be brought against any
Indemnified Party in respect of which indemnity may be sought pursuant to this
Agreement, such Indemnified Party shall promptly notify the Indemnifying Party
in writing, and the Indemnifying Party shall have the right to assume the
defense thereof with counsel of its own choosing. Any Indemnified Party shall
have the right to employ separate counsel in any such action and participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Party except to the extent that the employment
thereof has been specifically authorized by the Indemnifying Party in writing,
the Indemnifying Party has failed after a reasonable period of time to assume
such defense and to employ counsel or in such action there is, in the reasonable
opinion of such separate counsel, a material conflict on any material issue
between the position of the Indemnifying Party and the position of such
Indemnified Party. The Indemnifying Party will not be liable to any Indemnified
Party under this Article 6 for any settlement by an Indemnified Party effected
without the Indemnifying Party's prior written consent, which shall not be
unreasonably withheld or delayed; or to the extent, but only to the extent that
a loss, claim, damage or liability is attributable to any Indemnified Party's
breach of any of the representations, warranties, covenants or agreements made
by the Indemnified Party in this Agreement. The indemnification provided for in
this paragraph shall survive the Closing until the expiration of the applicable
statute of limitations. Notwithstanding anything to the contrary herein, any
obligation of Hi-Tech, VitroCo or VitroTech to indemnify any party under this
Agreement shall be subject and subordinate to the obligation of VitroCo, and its
successors and assigns, to indemnify Hi-Tech pursuant to the two (2) Assignment
and Assumption Agreements dated February 3, 2004.
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6.2 Indemnification as to the Star Stockholder. The Star Stockholder will
indemnify and hold VitroCo and Vitrotech and their officer and directors
harmless from any and all losses and damages, including all judgments and
amounts paid in settlements, that VitroCo or Vitrotech may suffer or incur as a
result of or relating to any breach of any of the representations and warranties
made specifically by the Star Stockholder as specified in Article 5 of this
Agreement. If any action shall be brought against VitroCo or Vitrotech in
respect of which indemnity may be sought pursuant to this Section 6.2 of this
Agreement, such party seeking to be indemnified shall promptly notify the Star
Stockholder in writing. The Star Stockholder will not be liable to such party
seeking to be indemnified pursuant to this Section 6.2 for any settlement by
such indemnified party effected without the Star Stockholder's prior written
consent, which shall not be unreasonably withheld. The Star Stockholder shall
not indemnify VitroCo and Vitrotech for any court costs, attorneys' fees or
costs of investigation that any such Indemnified Party may suffer or incur as a
result of or relating to any misrepresentation.
Each party to this Agreement will indemnify and hold the Star Stockholder
and his agents harmless from any and all losses, liabilities, obligations,
claims, contingencies, damages, costs and expenses, including all judgments,
amounts paid in settlements, court costs and reasonable attorneys' fees and
costs of investigation that the Star Stockholder may suffer or incur as a result
of or relating to any misrepresentation, breach or inaccuracy, of any of the
representations, warranties, covenants or agreements made by the Indemnifying
Party (as defined above) in this Agreement. If any action shall be brought
against the Star Stockholder in respect of which indemnity may be sought
pursuant to this Agreement, the Star Stockholder shall promptly notify the
Indemnifying Party in writing, and the Indemnifying Party shall have the right
to assume the defense thereof with counsel of its own choosing. The Star
Stockholder shall have the right to employ separate counsel in any such action
and participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of the Star Stockholder except to the extent
that the employment thereof has been specifically authorized by the Indemnifying
Party in writing, the Indemnifying Party has failed after a reasonable period of
time to assume such defense and to employ counsel or in such action there is, in
the reasonable opinion of such separate counsel, a material conflict on any
material issue between the position of the Indemnifying Party and the position
of the Star Stockholder. The Indemnifying Party will not be liable to the Star
Stockholder under this Article 6 for any settlement by the Star Stockholder
effected without the Indemnifying Party's prior written consent, which shall not
be unreasonably withheld or delayed; or to the extent, but only to the extent
that a loss, claim, damage or liability is attributable to the Star
Stockholder's breach of any of the representations, warranties, covenants or
agreements made by the Star Stockholder in this Agreement. The indemnification
provided for in this paragraph shall survive the Closing until the expiration of
the applicable statute of limitations. Notwithstanding anything to the contrary
herein, any obligation of Hi-Tech, VitroCo or VitroTech to indemnify any party
under this Agreement shall be subject and subordinate to the obligation of
VitroCo, and its successors and assigns, to indemnify Hi-Tech pursuant to the
two (2) Assignment and Assumption Agreements dated February 3, 2004.
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ARTICLE 7
COVENANTS AND AGREEMENTS OF THE PARTIES
EFFECTIVE PRIOR TO CLOSING
7.1 Corporate Examinations and Investigations. Prior to the Closing, each
party shall be entitled, through its employees and representatives, to make such
investigations and examinations of the books, records and financial condition of
VitroCo, VitroTech and Star as each party may request. In order that each party
may have the full opportunity to do so, VitroCo, VitroTech and Star shall
furnish each party and its representatives during such period with all such
information concerning the affairs of VitroCo, VitroTech and Star as each party
or its representatives may reasonably request and cause VitroCo, VitroTech and
Star and their respective officers, employees, consultants, agents, accountants
and attorneys to cooperate fully with each party's representatives in connection
with such review and examination and to make full disclosure of all information
and documents requested by each party and/or its representatives. Any such
investigations and examinations shall be conducted at reasonable times and under
reasonable circumstances, it being agreed that any examination of original
documents will be at each party's premises, with copies thereof to be provided
to each party and/or its representatives upon request.
7.2 Cooperation; Consents. Prior to the Closing, each party shall
cooperate with the other parties to the end that the parties shall: (i) in a
timely manner make all necessary filings with, and conduct negotiations with,
all authorities and other persons the consent or approval of which, or the
license or permit from which is required for the consummation of the
transactions contemplated in this Agreement; and (ii) provide to each other
party such information as the other party may reasonably request in order to
enable it to prepare such filings and to conduct such negotiations.
7.3 Conduct of Business. Subject to the provisions hereof, from the date
hereof through the Closing, each of VitroCo, VitroTech and Star hereto shall:
(i) conduct its business in the ordinary course and in such a manner so that the
representations and warranties contained herein shall continue to be true and
correct in all material respects as of the Closing as if made at and as of the
Closing; and (ii) not enter into any material transactions or incur any material
liability not required or specifically contemplated hereby, without first
obtaining the written consent of the other parties of this Agreement. Without
the prior written consent of the other parties to this Agreement , as the case
may be, except as required or specifically contemplated hereby, each party shall
not undertake or fail to undertake any action if such action or failure would
render any of said warranties and representations untrue in any material respect
as of the Closing.
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7.4 Litigation. From the date hereof through the Closing, each party
hereto shall promptly notify the representative of the other parties of any
lawsuits, claims, proceedings or investigations which after the date hereof are
threatened or commenced against such party or any of its affiliates or any
officer, director, employee, consultant, agent or shareholder thereof, in their
capacities as such, which, if decided adversely, could reasonably be expected to
have a material adverse effect upon the condition (financial or otherwise),
assets, liabilities, business, operations or prospects of VitroCo, VitroTech or
Star.
7.5 Notice of Default. From the date hereof through the Closing, each
party hereto shall give to the representative of the other parties prompt
written notice of the occurrence or existence of any event, condition or
circumstance occurring which would constitute a violation or breach of this
Agreement by such party or which would render inaccurate in any material respect
any of such party's representations or warranties herein.
ARTICLE 8
CONDITIONS TO CLOSING; CLOSING DELIVERIES
8.1 Conditions to Obligations of Hi-Tech and the VitroTech Shareholders.
The obligations of Hi-Tech and the VitroTech Shareholders under this Agreement
shall be subject to each of the following conditions:
(a) Closing Deliveries of Star. At the Closing, Star shall have
delivered or caused to be delivered to representatives of Hi-Tech the following:
(i) resolutions duly adopted by the Board of Directors of Star
authorizing and approving the execution, delivery and performance of this
Agreement and the Securities Purchase Agreement pursuant to which Star will
issue shares of Star Stock to investors in connection with a private placement
of Star common stock to close immediately following the Closing Date;
(ii) a certificate of good standing for Star from the
Secretary of State of the State of Nevada, dated not earlier than three days
prior to the Closing Date;
(iii) stock certificates representing the Star Shares bearing
the names of Hi-Tech and each of the VitroTech Shareholders as provided on
Exhibit "A" attached hereto;
(iv) a copy of this Agreement duly executed by Star and the
Star Stockholder;
(v) executed resignations and board resolutions appointing
officers and board members satisfactory to counsel for VitroTech; and
(vi) evidence of the redemption and cancellation of 6,043,496
shares of Star common stock held by the certain stockholders;
(vii) such other documents as Hi-Tech or the VitroTech
Shareholders may reasonably request in connection with the transactions
contemplated hereby.
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(b) Representations and Warranties to be True. The representations
and warranties of Star and the Star Stockholder herein contained shall be true
in all material respects at the Closing with the same effect as though made at
such time. Star and the Star Stockholder shall have performed in all material
respects all obligations and complied in all material respects with all
covenants and conditions required by this Agreement to be performed or complied
with by them at or prior to the Closing.
(d) No Material Adverse Effect. As of the Closing Date, there shall
have been no Material Adverse Effect with respect to Star since the date hereof.
8.2 Conditions to Obligations of Star. The obligations of Star under this
Agreement shall be subject to each of the following conditions:
(a) Closing Deliveries of Hi-Tech. On the Closing Date, Hi-Tech
shall have delivered to Star the following:
(i) a certificate of good standing for Hi-Tech from the
Secretary of State of the State of Nevada, dated not earlier than three days
prior to the Closing Date;
(ii) a copy of this Agreement duly executed by Hi-Tech;; and
(iii) a certificate representing all of the membership
interest of VitroCo bearing the name of Star and an executed amended and
restated VitroCo Materials, LLC Operating Agreement naming Star as the sole
member; and
(iv) such other documents as Star, the Star Stockholder may
reasonably request in connection with the transactions contemplated hereby.
(b) Representations and Warranties to be True. The representations
and warranties of Hi-Tech, VitroCo and VitroTech Shareholders herein contained
shall be true in all material respects at the Closing with the same effect as
though made at such time. Hi-Tech, VitroCo and the VitroTech Shareholders shall
have performed in all material respects all obligations and complied in all
material respects with all covenants and conditions required by this Agreement
to be performed or complied with by them at or prior to the Closing.
(c) No Material Adverse Effect. As of the Closing Date, there shall
have been no Material Adverse Effect with respect to Hi-Tech, VitroCo or
VitroTech since the date hereof.
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ARTICLE 9
ADDITIONAL AGREEMENTS
The parties hereto will cooperate with one another after Closing and,
without any further consideration, will execute and deliver such other documents
as shall be reasonably required after the Closing and to take any other action
necessary to carry out the intent and purposes of this Agreement.
ARTICLE 10
GENERAL PROVISIONS
10.1 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered personally,
sent by overnight courier or mailed by registered or certified mail (postage
prepaid and return receipt requested) to the party to whom the same is so
delivered, sent or mailed at addresses set forth on the signature page hereof
(or at such other address for a party as shall be specified by like notice).
10.2 Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. References to Sections and Articles refer to
sections and articles of this Agreement unless otherwise stated.
10.3 Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated and the parties shall negotiate
in good faith to modify this Agreement to preserve each party's anticipated
benefits under this Agreement.
10.4 Miscellaneous. This Agreement (together with all other documents and
instruments referred to herein): (a) constitutes the entire agreement and
supersedes all other prior agreements and undertakings, both written and oral,
among the parties with respect to the subject matter hereof; (b) except as
expressly set forth herein, is not intended to confer upon any other person any
rights or remedies hereunder and (c) shall not be assigned by operation of law
or otherwise, except as may be mutually agreed upon by the parties hereto.
10.5 Separate Counsel. Each party hereby expressly acknowledges that it
has been advised to seek its own separate legal counsel for advice with respect
to this Agreement, and that no counsel to any party hereto has acted or is
acting as counsel to any other party hereto in connection with this Agreement.
10.6 Governing Law; Venue. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of California,
U.S.A. Any and all actions brought under this Agreement shall be brought in the
state and/or federal courts of the United States sitting in the City of Los
Angeles, California and each party hereby waives any right to object to the
convenience of such venue.
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10.7 Counterparts and Facsimile Signatures. This Agreement may be executed
in two or more counterparts, which together shall constitute a single agreement.
This Agreement and any documents relating to it may be executed and transmitted
to any other party by facsimile, which facsimile shall be deemed to be, and
utilized in all respects as, an original, wet-inked document.
10.8 Amendment. This Agreement may be amended, modified or supplemented
only by an instrument in writing executed by all parties hereto.
10.9 Parties In Interest: No Third Party Beneficiaries. Except as
otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. This Agreement
shall not be deemed to confer upon any person not a party hereto any rights or
remedies hereunder.
10.10 Waiver. No waiver by any party of any default or breach by another
party of any representation, warranty, covenant or condition contained in this
Agreement shall be deemed to be a waiver of any subsequent default or breach by
such party of the same or any other representation, warranty, covenant or
condition. No act, delay, omission or course of dealing on the part of any party
in exercising any right, power or remedy under this Agreement or at law or in
equity shall operate as a waiver thereof or otherwise prejudice any of such
party's rights, powers and remedies. All remedies, whether at law or in equity,
shall be cumulative and the election of any one or more shall not constitute a
waiver of the right to pursue other available remedies.
10.11 Expenses. At or prior to the Closing, the parties hereto shall pay
all of their own expenses relating to the transactions contemplated by this
Agreement, including, without limitation, the fees and expenses of their
respective counsel and financial advisers.
10.12 Schedules. If there is any inconsistency between the statements in
the body of this Agreement and those in the schedules (other than an exception
expressly set forth in the schedules with respect to a specifically identified
representation or warranty), the statements in the body of this Agreement will
control.
10.13 Construction. The parties have participated jointly in the
negotiation and drafting of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement will be construed as if drafted
jointly by the parties and no presumption or burden of proof will arise favoring
or disfavoring any party because of the authorship of any provision of this
Agreement.
10.14. Incorporation of Exhibits and Schedules. The exhibits, schedules,
and other attachments identified in this Agreement are incorporated herein by
reference and made a part hereof.
[SIGNATURES FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
"STAR:" "STAR STOCKHOLDER:"
Star Computing, Ltd.,
a Nevada corporation
By:________________________________ ________________________________________
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"HI-TECH:" "VITROCO:"
Hi-Tech Environmental Products, LLC, Vitroco Materials, LLC,
a Nevada limited liability company a Nevada limited liability company
By:________________________________ By:_____________________________________
Name: Name:
Title: Title:
"VITROTECH:"
Vitrotech Corporation
a Nevada corporation
By:________________________________
Name:
Title:
[SIGNATURES CONTINUE ON NEXT PAGE]
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[SIGNATURE PAGE TWO OF
STOCK PURCHASE AGREEMENT]
"VITROTECH SHAREHOLDERS:"
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___________________________________ ________________________________________
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___________________________________ ________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
___________________________________ ________________________________________
▇▇▇▇ ▇. Frankfort ▇▇▇▇▇▇ ▇. Frankfort
___________________________________
▇▇▇▇▇ ▇. Frankfort
___________________________________ ________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
[SIGNATURES CONTINUE ON NEXT PAGE]
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[SIGNATURE PAGE THREE OF
STOCK PURCHASE AGREEMENT]
___________________________________ ________________________________________
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
Roc-Tech, LLC Lasting Touch, LLC
By:________________________________ By:_____________________________________
Name: Name:
Title: Title:
▇▇▇▇▇▇▇▇▇ Consultants, LLC Lamb Associates
By:________________________________ By:_____________________________________
Name: Name:
Title: Title:
Elgin Investments, LLC
By:________________________________
Name:
Title:
-33-
DISCLOSURE SCHEDULE OF HI-TECH, VITROCO
AND THE VITROTECH SHAREHOLDERS
This Disclosure Schedule modifies, amends, supplements and discloses, and states
exceptions to, the representations and warranties of Hi-Tech, VitroCo or the
VitroTech Shareholders, set forth in Section 4 of the Agreement. Each disclosure
herein, including but not limited to those which are contained on any
subschedules or exhibits included herein, is made for the sake of convenience as
to all sections of the Agreement, even if such disclosure is specified for a
single section of the Agreement, without the need for identification of specific
additional sections or repetition, but only to the extent that the disclosure is
reasonably apparent on its face as being applicable to such other section. Any
terms not defined herein which are defined in the Agreement shall have the
meaning set forth in the Agreement. Where any representation or warranty
contained in the Agreement is limited or qualified by the materiality of the
matters to which the representation or warranty is given, the inclusion of any
matter in this Disclosure Schedule does not constitute a determination that such
matters are material.
4.7 The liabilities reflected in the Vitro Financial Statements may not take
into account of liabilities due to Hi-Tech or VitroCo's vendors and
service providers that have provided services to Hi-Tech or VitroCo in the
ordinary course of their business but that have not yet billed or invoiced
Hi-Tech or VitroCo as of the date of the Vitro Financial Statements for
such services. The amount of such liabilities may exceed $500,000.
Hi-Tech, VitroCo and VitroTech hereby disclose that the U.S. Patent and
Trademark Office has issued a patent to Polyone Corporation, U.S. Patent
Application No. 2002-0198121, issued December 26, 2002, entitled
"Composition and Method for Improvement of Resin Flow Polymer Processing
Equipment", which Hi-Tech, VitroCo and VitroTech believe may be an
infringement upon VitroCo's intellectual property.
4.13 See, Disclosure Schedule Section 4.7 regarding Polyone Corporation patent.
4.31 VitroTech has not made the appropriate filings under the Blue Sky Laws in
the jurisdictions in which it sold shares of its founders common stock.
-34-
SCHEDULE OF EXCEPTIONS
This Schedule of Exceptions relates to that certain Stock Purchase
Agreement by and among Star Computing Ltd., a publicly traded Nevada corporation
("Star"), and ▇▇▇▇▇ ▇. Poland, an individual stockholder of Star (the "Star
Stockholder") on the one hand, and Hi-Tech Environmental Products, LLC, a Nevada
limited liability company d/b/a VitroCo ("Hi-Tech"), VitroCo Materials, LLC, a
Nevada limited liability company ("VitroCo"), VitroTech Corporation, a Delaware
corporation ("Vitrotech") and all of the shareholders of VitroTech
(collectively, the "VitroTech Shareholders") on the other hand, which is dated
as of February 3, 2004 ("Agreement"). This Schedule of Exceptions references the
specific representations and warranties as to which an exception is made,
provided, however, that if an exception could apply to any other specific
representation and warranty, such exception shall be deemed to have referenced
such other specific representation and warranty if a reasonable person could
ascertain the applicability of such exception to such other specific
representation and warranty.
Capitalized terms used in this Schedule of Exceptions shall have the same
meaning when used in the Agreement unless otherwise specified. Unless otherwise
designated, all information contained herein is effective as of January 30,
2004:
5.1 Organization. None.
5.2 Capitalization. Star's authorized capital stock consists of
50,000,000 shares of capital stock, all of which are designated as
Common Stock, of which no more than 5,000,000 shares at the Closing
will be issued and outstanding.
5.3 Certain Corporate Matters. None.
5.4 Authority Relative to this Agreement. None.
5.5 Consents and Approvals; No Violations. None.
5.6 SEC Documents. None.
5.7 Financial Statements. None.
5.8 Events Subsequent to Financial Statements.
a) Star's forward split of its common stock, which was effective
on December 1, 2003.
b) Star's redemption of 5,043,496 shares of common stock from
certain shareholders.
5.9 Undisclosed Liabilities. None.
5.10 Tax Matters. None.
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5.11 Real Property. None.
5.12 Books and Records. None.
5.13 Questionable Payments. None.
5.14 Environmental Matters. None.
5.15 Intellectual Property. Domain name ▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇.
5.16 Insurance. None.
5.17 Contracts. None.
5.18 Litigation. None.
5.19 Employees. Star has no employees, other than the outgoing management
of Star, who will be tendering their resignations.
5.20 Employee Benefit Plans. None.
5.21 Legal Compliance. None.
5.22 Subsidiaries.
a) Seegott Acquisition Corporation; and
b) VitroTech Acquisition Corporation.
5.23 Broker's Fees. None.
5.24 Registration Rights. None.
5.25 Listing and Maintenance Requirements. None.
5.26 No Disagreements with Accountants and Lawyers. None.
5.27 Securities Law Compliance. None.
5.28 Title to Properties, Liens and Encumbrances. None.
5.29 Accounts Receivable. None.
5.30 Bank Accounts. None.
5.31 True Copies. None.
5.32 Disclosure. None.
-36-
EXHIBITS TO THIS AGREEMENT
-37-
Exhibit A
Allocation of Star Shares to VitroTech Shareholders
VitroTech Shareholders Star Shares
---------------------- -----------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 125,000
Lasting Touch, LLC - ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Manager 25,000
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 25,000
▇▇▇▇ ▇. & ▇▇▇▇▇ ▇. Frankfort 37,500
▇▇▇▇ ▇. Frankfort & ▇▇▇▇▇▇ ▇. Frankfort 12,500
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ 187,500
▇▇▇▇▇▇▇▇▇ Consultants, LLC, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Manager 50,000
Lamb Associates, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇-▇▇▇▇▇, Trustee 300,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D. 125,000
▇▇▇▇▇ ▇▇▇▇▇▇▇ 125,000
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 62,500
▇▇▇▇ ▇▇▇▇▇▇ 62,500
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 250,000
▇▇▇▇ ▇▇▇▇▇ 125,000
▇▇▇▇ ▇▇▇▇▇ 250,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 50,000
RocTech, LLC, ▇▇▇▇▇▇ ▇▇▇▇▇▇, President 37,500
▇▇▇▇▇▇ ▇▇▇▇▇ 25,000
Elgin Investments, LLC 13,000,000
-38-
Exhibit B
List of Liabilities Assumed by Star
Star Computing Limited, a Nevada corporation, that will change its name to
VitroTech Corporation shortly after the date of this agreement ("Star") will not
directly assume any liabilities of VitroCo. Star, however, will guaranty certain
obligations of VitroCo Materials, LLC to: (i) Red Rock Canyon Mineral, LLC, a
California limited liability company; (ii) Valley Springs Mineral, LLC, a
California limited liability company; (iii) Hi-Tech Environmental Products, LLC,
a Nevada limited liability company; (iv) Enviro Investment Group, LLC, a Nevada
limited liability company pursuant to those certain Guaranties made as of
February 3, 2004 by Star.
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