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Exhibit 2.3
Agreement of Purchase and Sale of Securities
by and among
SATX, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇
and
ORA Electronics, Inc.
dated March 12, 2001
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AGREEMENT OF
PURCHASE AND SALE OF SECURITIES
Agreement made March 12, 2001, between and among SATX, Inc., a Nevada
corporation, hereinafter called the "Seller", and ▇▇▇▇▇ ▇▇▇▇▇▇, hereinafter
called the "Purchaser" and ORA Electronics, Inc., a Delaware corporation,
hereinafter called "ORA".
WHEREAS, the Seller is a principal shareholder of ORA and is the owner
of 4,982,600 shares of ORA common stock, and
WHEREAS, the Purchaser desires to buy the 4,982,600 shares, and the
Seller is desirous of selling the Shares, and
WHEREAS, Purchaser has agreed to provide ORA with sufficient funds to
cure the mortgage payment default and the property tax default on behalf of
ORA, and
WHEREAS, ORA has agreed to utilize the funds provided by the Purchaser
to cure the mortgage payment default and the property tax default,
IT IS THEREFORE AGREED:
1. SALE. The Seller hereby sells to the Purchaser 3,982,600 shares of the
common stock of ORA (the "Shares") and simultaneously with the
execution of this Agreement has delivered to the Purchaser a
certificate(s) for such shares together with stock power(s) endorsed in
blank with signature guaranteed.
2. PURCHASE. The Purchaser hereby buys from the Seller the 3,982,600
shares of common stock of ORA and in consideration therefor shall pay
to the Seller, upon receipt of ORA stock certificates and stock powers
executed by the Seller, a cashiers or certified check in the amount of
$35,000.00.
3. SELLER'S REPRESENTATIONS. Seller represents and warrants that (a) the
Shares to be delivered to Purchaser will be fully paid and
non-assessable, (b) there are no liens, obligations or liabilities
against the Shares and the Shares are free of any restrictions against
transfer, other than state and federal securities law restrictions,
and (c) the Board of Directors of Seller, pursuant to the power and
authority legally vested in it, has duly authorized the execution and
delivery of this Agreement, the stock certificate(s) and stock power(s)
and has duly authorized each of the transactions hereby contemplated.
Seller has the power and authority to execute and deliver this
Agreement, to consummate the transactions hereby contemplated and to
take all other actions required to be taken by it pursuant to the
provisions hereof. Seller has taken all actions required by law, its
Articles of Incorporation, as amended, and the Bylaws, as amended, or
otherwise to authorize the execution and delivery of this Agreement.
This Agreement is valid and binding upon
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Seller in accordance with its terms. Neither the execution and
delivery of this Agreement nor the consummation of the transactions
contemplated hereby will constitute a violation or breach of the
Articles of Incorporation, as amended, or the Bylaws, as amended, of
Seller, or any agreement, stipulation, order, writ, injunction,
decree, law, rule or regulation applicable to Seller.
4. PURCHASER'S REPRESENTATIONS. Purchaser acknowledges and agrees that:
(i) the Shares have not been registered under the Securities Act
of 1933, as amended (hereafter referred to as the "Securities
Act"), in reliance upon exemptions contained in the
Securities Act and the Rules and Regulations promulgated by
the Securities and Exchange Commission under the Securities
Act in particular, Section 4(1) under the Securities Act; and
(ii) the Shares are not freely tradable and must be held by
Purchaser indefinitely or until such time, if any, as the
Shares are either registered under the Securities Act or
transfer may be made pursuant to an exemption from such
registration under the Securities Act or under the Rules and
Regulations promulgated thereunder. Purchaser represents that
he understands the restrictions on his ability to transfer
the Shares.
Purchaser hereby represents that the shares are not being acquired
with a view to any distribution thereof in violation of the Securities
Act, or any other applicable laws of the United States or any state
therein, but are being acquired for investment purposes and are to be
held for the Purchaser's own account.
Purchaser understands that the Seller is a principal shareholder of
ORA. Purchaser represents that he has received no representations from
the Seller relating to the future potential, if any, of ORA. In making
his decision to purchase the Shares, the Purchaser has relied solely
upon his own independent investigation.
5. CALL AGREEMENT. Seller hereby grants to Purchaser a "call" to
purchase, at any time, the Seller's remaining 1,000,000 shares of ORA
Common Stock at a call price of $3.00 per share.
6. PUT AGREEMENT. Purchaser hereby grants to Seller a "put" to sell to
Purchaser its remaining 1,000,000 shares of ORA Common Stock at the
put price of $3.00 per share, commencing 12 months from the date of
this Agreement as follows:
At any time after the ORA Common Stock has traded
at a bid price of at least $4.50 per share for a
period of ten (10) consecutive trading days,
Seller shall have the right to "put" the remaining
1,000,000 shares to Purchaser at a price of $3.00
per share. Purchaser shall make four (4) equal
quarterly payments of $750,000 to Seller
commencing 15 days after written notice of the
"put" to pay for the shares.
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7. RIGHT OF FIRST REFUSAL. If after twenty-four (24) months from the date
of this Agreement neither the "call" nor "put" provisions as set forth
hereinabove have resulted in the sale of all of the remaining ORA
Common Stock owned by the Seller, the Seller may sell its remaining
shares of ORA Common Stock in a bona fide arms-length transaction,
after giving the Purchaser a written right of first refusal for a
period of ten (10) days. If the Purchaser has agreed in writing to
purchase the ORA Common Stock within such ten (10) day period, he
shall have twenty (20) days thereafter to deliver good funds for the
purchase of the Seller's remaining ORA Common Stock. If the Purchaser
has not agreed to purchase the ORA Common Stock within ten (10) days
after written notice to Purchaser of a proposed bona fide sale by
Seller, Seller shall have no further obligation to sell such remaining
ORA Common Stock to Purchaser and may sell such shares from time to
time in accordance with then-current federal and state securities
laws.
8. CURING OF DEFAULTS. Upon the close of this Agreement the Purchaser
agrees to provide funding to ORA to cure its mortgage payment default
owed to AAL by next-day delivery to AAL of a check in the amount of
$90,743.62. Within fifteen (15) days of the date of this Agreement,
ORA agrees to enter into a settlement arrangement with the County of
Los Angeles to pay any and all property taxes owed by ORA relating to
its building at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
In addition, Purchaser shall arrange for Seller to be notified by AAL
should ORA be in default in the future and if that default is not
cured within forty-five (45) days after notice of default from AAL. If
the default is not cured, Seller shall have the right to cure such
default and thereafter shall have the right to sell the building under
terms which will result in the release of ▇▇▇▇ ▇▇▇▇▇▇ and Seller from
any contingent liability to AAL. Any proceeds from the sale of the
building over and above the payment of the mortgage and expenses
related thereto, including any expenses of the Seller relating to such
sale, shall be paid to ORA less ten percent (10%) of such net proceeds
which shall be paid to Seller.
9. SALE OR REFINANCE OF BUILDING. Within twelve (12) months from the date
of this Agreement, ORA agrees to either refinance or sell its building
located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
under terms and conditions which will result in the release of ▇▇▇▇
▇▇▇▇▇▇ and Seller from any contingent liability to AAL.
10. ISSUANCE OF STOCK TO ▇▇. ▇▇▇ AND ▇▇. ▇▇▇▇▇▇. Within ten (10) business
days after the closing of the purchase and sale set forth in
paragraphs 1 and 2 hereof, ORA shall issue 300,000 shares and 50,000
shares of its Common Stock to ▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇,
respectively, only if Messrs. ▇▇▇ and ▇▇▇▇▇▇ agree to be subject to
similar and proportional "call" and "put" provisions as set forth in
paragraphs 5, 6 and 7 set forth above.
11. PAYMENT ON BMW AUTOMOBILE. Within thirty (30) days from the date of
this Agreement, Seller shall pay directly to BMW Financial Services
lease payments, including any and all late charges, owed on that
certain 1999 BMW 740i, currently in the possession of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
for the months of December 2000, January, February and March 2001.
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Seller shall pay the April and May 2001 lease payments and shall
arrange for the surrender or purchase of the vehicle upon the
termination of the lease in May 2001. Seller shall hold ORA harmless
from any liability relating to the aforementioned 1999 BMW 740i,
including any monies owed to BMW Financial Services.
12. INDEMNIFICATION
(a) In consideration of the Purchaser's execution and delivery of
this Agreement and acquiring the Shares hereunder and in
addition to all of Seller's and ORA's other obligations under
this Agreement, Seller shall defend, protect, indemnify and
hold harmless the Purchaser and ORA and, if any, all of their
officers, directors, employees and direct or indirect
investors and any of the foregoing persons, agents or other
representatives (including, without limitation, those
retained in connection with the transactions contemplated by
this Agreement) (collectively, the "Indemnities") from and
against any and all actions, causes of action, suits, claims,
losses, costs, penalties, fees, liabilities and damages, and
expenses in connection therewith (irrespective of whether any
such Indemnitee is a party to the action for which
indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the
"Indemnified Liabilities"), incurred by any Indemnitee as a
result of, or arising out of, or relating to (1) any
misrepresentation or breach of any representation or warranty
made by Seller in this Agreement or any other certificate,
instrument or document contemplated hereby or thereby, (2)
any breach of any covenant, agreement or obligation of Seller
contained in this Agreement or any other certificate,
instrument or document contemplated hereby or thereby, (3)
any cause of action, suit or claim brought or made against
such Indemnitee and arising out of or resulting from the
execution, delivery, performance or enforcement of this
Agreement or any other certificate, instrument or document
contemplated hereby or thereby. To the extent that the
foregoing undertaking by Seller may be unenforceable for any
reason, Seller shall make the maximum contribution to the
payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
(b) In consideration of the Seller's execution and delivery of
this Agreement and selling the Shares hereunder and in
addition to all of ORA's other obligations under this
Agreement, ORA shall defend, protect, indemnify and hold
harmless the Seller and if any, all of their officers and
directors, and any of the foregoing persons, agents or other
representatives (including, without limitation, those
retained in connection with the transactions contemplated by
this Agreement) (collectively, the "Indemnities") from and
against any and all actions, causes of action, suits, claims,
losses, costs, penalties, fees, liabilities and damages, and
expenses in connection therewith (irrespective of whether any
such Indemnitee is a party to the action for which
indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the
"Indemnified Liabilities"), incurred by any Indemnitee as a
result of, or arising out of, or relating to (1) any
misrepresentation or breach of any representation or warranty
made by ORA in this Agreement or any other certificate,
instrument or document
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contemplated hereby or thereby, (2) any breach of any,
covenant, agreement or obligation of ORA contained in this
Agreement or any other certificate, instrument or document
contemplated hereby or thereby, (3) any cause of action,
suit or claim brought or made against such Indemnitee and
arising out of or resulting from the execution, delivery,
performance or enforcement of this Agreement or any other
certificate, instrument or document contemplated hereby or
thereby. To the extent that the foregoing undertaking by ORA
may be unenforceable for any reason, ORA shall make the
maximum contribution to the payment and satisfaction of each
of the Indemnified Liabilities which is permissible under
applicable law.
13. USE OF OFFICES. ORA agrees to provide, at a mutually agreed upon cost,
limited office space to Seller for a period not to exceed one hundred
eighty (180) days from the date of this Agreement.
14. REPRESENTATIONS OF ORA. ORA represents that other than information
that has already been provided to Seller, and other than in the course
of its ordinary business, ORA's management does not know of any
extraordinary orders, business or sales or any other material event to
be effected by ORA within ninety (90) days from the date of this
Agreement.
15. RIGHT TO ALPHATRACK. Both ORA and Purchaser agree and represent that
they do not have any claim, right, lien, or ownership of any patent or
proprietary information relating to the AlphaTrack product. Any
written, documents and/or information contained on ORA's computers
relating to the AlphaTrack product will be delivered to Seller upon
closing of this Agreement.
16. TRADE SECRETS. Seller and ORA specifically agree that they will not,
at any time, in any fashion, form or manner, unless specifically
consented to in writing by the other, either directly or indirectly
use or divulge, disclose or communicate to any person, firm or
corporation, in any manner whatsoever, any confidential information of
any kind, nature or description concerning any matter affecting or
relating to the business of ORA or AlphaTrack, including without
limiting the generality of the foregoing, the names, buying habits,
rates being charged or practices of any of its clients, its marketing
methods and related data, the names of any of its vendors or
suppliers, costs of materials, the prices it obtains or has obtained
and which it sells or has sold its services, sales costs, lists or
other written records used in ORA's business or in the development of
the AlphaTrack product, compensation paid to employees and other terms
of employment, or any other confidential information of, about or
concerning the business of ORA or the development of the AlphaTrack
product, its manner of operation or other confidential data of any
kind, nature or description, the parties hereto stipulating that as
between them, the same are important, material and confidential trade
secrets and affect the successful conduct of ORA's business and its
goodwill, and the development of the AlphaTrack product, and that any
breach of any term of this paragraph is a material breach of this
Agreement. All equipment, notebooks, documents, memoranda, reports,
files, samples, books, correspondence, lists, other written and
graphic records, and the like affecting or relating to the business of
ORA
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or the development of the AlphaTrack product, which ORA or Seller has
prepared, used, constructed, observed or controlled shall be and
remain ORA's and Seller's sole property, respectively.
17. RESTRICTIVE COVENANTS.
(a) Seller. For a period of three (3) years from the close of
this Agreement, in consideration of this Agreement and other
good and valuable consideration, the Seller shall not:
(i) Canvass, solicit or accept any business relating to
ORA's business from any present or past clients of
ORA.
(ii) Give any other person, firm or corporation the right
to canvass, solicit or accept any business relating
to ORA's business from any present or past clients
of ORA.
(iii) Directly or indirectly request or advise any present
or future clients of ORA to withdraw, curtail or
cancel his business with ORA.
(iv) Other than the employment of ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇, directly or indirectly
induce or attempt to influence any employee of ORA
to terminate his employment.
(v) Directly or indirectly utilize proprietary
information of ORA.
(b) ORA. For a period of three (3) years from the close of this
Agreement, in consideration of this Agreement and other good
and valuable consideration, the ORA shall not:
(i) Canvass, solicit or accept any business relating to
Seller's AlphaTrack business from any present or
past clients of Seller.
(ii) Give any other person, firm or corporation the right
to canvass, solicit or accept any business relating
to the AlphaTrack business from any present or past
clients of Seller.
(iii) Directly or indirectly request or advise any present
or future clients of Seller to withdraw, curtail or
cancel his business with Seller.
(iv) Directly or indirectly induce or attempt to
influence any employee of Seller to terminate his
employment.
(v) Directly or indirectly engage in the business of
selling products in competition with Seller's
AlphaTrack product.
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18. RESIGNATION OF DIRECTORS. Upon the closing of the sale and purchase of
the Shares, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, both directors
of the Seller, shall resign as directors of ORA. ORA agrees to
indemnify such directors against any and all actions, causes of
action, suits, claims, losses and costs, penalties, fees, liabilities
and damages, and expenses in connection with any action taken by ORA's
directors and/or officers after the date of resignation from the ORA
Board of Directors by Messrs. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇.
19. GOVERNING LAW: MISCELLANEOUS
(a) Governing Law; Jurisdiction; Jury Trial. The corporate laws
of the States of Nevada and Delaware shall govern all issues
concerning the relative rights of SATX and ORA, respectively,
and their stockholders. All other questions concerning the
construction, validity, enforcement, and interpretation of
this Agreement shall be governed by the internal laws of the
State of California, without giving effect to any choice of
law or conflict of law provision or rule (whether of the
State of California or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other
than the State of California. Each party hereby irrevocably
submits to the non-exclusive jurisdiction of the state and
federal courts sitting in the City of Los Angeles for the
adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any
such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit,
action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents
to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and
agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(b) Counterparts. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one
and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to
the other party; provided that a facsimile signature shall be
considered due execution and shall be binding upon the
signatory thereto with the same force and effect as if the
signature were an original, not a facsimile signature.
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(c) Headings. The headings of this Agreement are for convenience
of reference and shall not form part of, or affect the
interpretation of, this Agreement.
(d) Severability. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or
enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any
provision of this Agreement in any other jurisdiction.
(e) Entire Agreement; Amendments. This Agreement supersedes all
other prior oral or written agreements between the Purchaser,
the Seller and ORA, their affiliates and persons acting on
their behalf with respect to the matters discussed herein,
and this Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect
to the matters covered herein and therein and, except as
specifically set forth herein or therein, neither the Seller
nor the Purchaser makes any representation, warranty,
covenant or undertaking with respect to such matters. No
provision of this Agreement may be amended other than by an
instrument in writing signed by the Seller and the Purchaser,
and no provision hereof may be waived other than by an
instrument in writing signed by the party against whom
enforcement is sought.
(f) Survival of Representations and Covenants. All
representations and covenants made by each party to this
Agreement shall survive the Closing for the benefit of the
other party.
(g) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their
respective successors and assigns.
(h) No Third Party Beneficiaries. This Agreement is intended for
the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other
person.
(i) Survival. The representations and warranties of the Seller
and the Purchaser contained in Section 3 and 4, the
indemnification provisions set forth in Section 11, and the
restrictive covenants provisions set forth in Section 16
shall survive the Closing.
(j) Publicity. Seller, Purchaser and ORA shall have the right to
approve before issuance any press releases or any other
public statements with respect to the transactions
contemplated hereby; provided, however, that ORA shall be
entitled, without the prior approval of the Seller or
Purchaser, to make any press release or other public
disclosure with respect to such transactions as is required
by applicable law, regulation, or rule of the NASD or
Principal Market (although the Seller and Purchaser shall be
consulted by ORA in connection with any such press release or
other public disclosure prior to its release and shall be
provided with a copy thereof).
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(k) Further Assurances. Each party shall do and perform, or cause
to be done and performed, all such further acts and things,
and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party
may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
written above.
SELLER:
SATX, INC.
BY: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
PURCHASER:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇
ORA ELECTRONICS, INC.
BY: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇, President
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