STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into this 1st day of November
1998, between The Shadow Ridge Water Company, 000 Xxxxxxxxxxx
Xxxxx, Xxxxxxxx, Xxxxxxx, 000000. hereinafter referred to as the
"Seller" and The Great Basin Water Company, 000 Xxxx Xxxxxxxx
Xxxx., Xxxxx 000, Xxxxxxxx, Xxxxxx, 00000, and/or assigns and/or
nominees, hereinafter collectively referred to as the "Purchaser"
(the term "Purchaser" shall extend to in the first instance the
original Purchaser named herein and also the assigns of such
Purchaser.);
WITNESSETH:
WHEREAS, the Seller is the record owner and holder of the issued
and outstanding shares of the capital stock of The Shadow Ridge
Water Company, hereinafter referred to as the "Corporation", an
Arizona corporation; which Corporation has issued capital stock
of One Million Shares (1,000,000) of $0.001 par value common
stock, and
WHEREAS, the Purchaser desires to purchase all of the issued and
outstanding capital stock of the Corporation (referred to as the
"Corporation's stock), and the Seller desires to sell or cause to
be sold all of the Corporations stock, upon the terms and subject
to the conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained in this Agreement, and in order to
consummate the purchase and the sale of the Corporation's stock
aforementioned, it is hereby agreed as follows:
1. PURCHASE AND SALE: CLOSING.
a. Purchase and Sale of Corporation's Stock. Subject to the
terms and conditions hereinafter set forth, at the closing
of the transaction contemplated hereby, the Seller shall
sell, convey and transfer or cause to be sold, conveyed or
transferred, all of the Corporation's Stock and deliver to
the purchaser certificates
representing such stock, and the Purchaser shall purchase
from the Seller the Corporation's Stock in consideration of
the purchase Agreement. The certificates representing the
Corporation's Stock shall be duly endorsed for transfer or
accompanied by appropriate stock transfer powers duly
executed in blank, in either case with signatures guaranteed
in the customary fashion, and shall have all the necessary
documentary transfer tax stamps affixed thereto at the
expense of the Seller.
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b. Procedures for Closing. The Closing of the transactions
contemplated by this Agreement (the Closing), shall be held
at the offices of the The Great Basin Water Company, on the
1st day of November, 1998, at 1:00 P.M. or such other place,
date and time as the parties hereto may otherwise agree
(such date to be referred to in this Agreement as the
Closing Date), so long as the closing is within one year of
the date of the agreement. After such time, the controlling
corporation shall be the purchaser, The Great Basin Water
Company, and is to be governed under the laws of the State
of Nevada.
2. AMOUNT AND PAYMENT OF PURCHASE PRICE. The total consideration
and method of payment thereof are fully set out in Exhibit "A"
attached hereto and made a part hereof by this reference.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller hereby
warrants and represents:
a. Organization and Standing. Corporation is a corporation
duly organized, validly existing and in good standing under
the laws of the State of Arizona and has the corporate power
and authority to carry on its business as it is now being
conducted. A true and correct copy of:
i. the certificate of Incorporation and all amendments
thereto to date certified by the Secretary of State of
the Sate of Arizona, and
ii. the Bylaws as now in effect, will be delivered by
Seller to the Purchaser prior to the Closing Date. The
Corporations minute boot%s will be made available to
the Purchaser and its representatives at any reasonable
time or times prior to the Closing for inspection and
will be complete and correct as of the date of any such
inspection.
b. Capitalization. The authorized capital stock of the
Corporation consists of One Million Shares of $0.001 par
value common stock.
c . Restrictions on Stock.
i. Neither the Corporation nor Seller is a party to any
agreement, written or oral, creating rights in respect
to the Corporations Stock in any third person or
relating to the voting of the Corporations Stock.
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ii. Seller is the lawful owner of all the Corporation's
Stock, free and clear of all security interests, liens,
encumbrances, equities and other charges.
iii. There are no existing warrants, purchase
agreements, redemption options, stock agreements,
restrictions of any nature, calls, or rights to
subscribe of any character relating to the Capital
stock of the Corporation, nor are there any securities
convertible into such stock.
d. Subsidiaries.- The Corporation has no subsidiaries.
e. Authority Relative to this Agreement. Except as
otherwise stated herein the Seller has full power and
authority to execute this Agreement and carry out the
transactions contemplated by it and no further action is
necessary by the Seller to make this Agreement valid and
binding upon Seller and enforceable against it in accordance
with the terms hereof, or to carry out the actions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Seller will not:
i. Constitute a breach or a violation of the
Corporation's Certificate of Incorporation,
By-Laws or of any law, agreement, indenture, deed of
trust, mortgage, loan agreement or other instrument to
which it is a party, or by-which it is bound;
ii. constitute a violation of any order, judgement or
decree to which it is a party or by which its assets or
properties are bound or affected; or
iii. result in encumbrance upon stated herein.
the creation of any lien, charge or its assets or
properties, except as
f. Financial Statements. Seller is furnishing financial
statements of the Corporation as an inducement to Purchaser
to purchase the Corporation's Stock and accordingly, Seller
warrants and represents the financial operating history or
condition of the Corporation as indicated by the financial
statements turned over to Purchaser. Moreover, Seller
warrants and represents that at closing the Corporation and
the Corporation's stock will not be subject to any liability
save and except those specifically enumerated in Exhibit "B"
attached hereto and made a part hereof.
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To the extent that liabilities are discovered by Purchaser,
after closing which relate to events prior to closing,
Seller shall be responsible to forthwith pay such
liabilites, including income tax liabilities in cash within
fifteen (15) days thereof, or alternatively, if Seller
objects to such liabilities in good faith, litigate the
issue and indemnify and save harmless Purchaser from any
claim for such income tax liability. This indemnification as
it relates -to income tax liabilities of the Corporation
shall terminate on the tenth (10th) day after the expiration
of the applicable period of limitations on assessments and
collections applicable to such taxes under the Internal
Revenue Code. Moreover, the aforementioned indemnity shall
not apply to any tax liability which may occur by reasons of
actions taken by the Purchaser including, but not limited
to, the liquidation of the Corporation.
g. Tax Matters. The Corporation has timely prepared and
filed all federal, state and local tax returns and reports
as are and have been required to be filed and all taxes
shown thereon to be due have been paid in full.
h. Litigation. The Corporation is not a party to any
litigation, proceeding or administrative investigation and
to the best knowledge of the Seller none is pending
against the Corporation or its properties.
i. Properties. The Corporation has good and sellable title
to all of its properties and assets which are those
properties and assets set out in Exhibit "C" attached hereto
and made a part hereof. At closing, such properties and
assets will be subject to no mortgage, pledge, lien,
conditional sales agreement, security agreement,
encumbrance or charge, secured or unsecured, except for real
estate mortgages or taxes and tangible personal properety
taxes which shall be prorated as of the date of closing, or
those specifically set out in Exhibit "B".
J. Compliance with Applicable Laws. None of the
Corporation's Actions are prohibited by or have violated or
will violate any law in effect on the date of this Agreement
or on the date of closing. None of the actions of the
Corporation shall conflict with or result in
any breach of any of the provisions of, or constitute a
default under, or result in the creation of any lien,
security interest, charge or encumnbrance upon the capital
stock of the Corporation, or upon any of the assets of the
Corporation, under the provisions of the Certificate of
Incorporation or Bylaws or any indenture, mortgage, lease,
loan agreement or other agreement to which the Corporation
and/or the Seller is a party or by which the capital stock
or properties and
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assets of the Corporation are bound to affect it.
The Corporation is in compliance with all applicable laws,
including, but not limited to, corporate laws, zoning
regulations, requirements of the Corporation Commission of
the State of Arizona, the Department of Environmental
Quality of the State of Arizona, state occupational laws and
regulations, internal revenue laws, and any and all other
laws which may effect the operation or liability of the
Buyers herein.
k. Documents for Review. The Corporation's documents
enumerated in Exhibit "D", attached hereto and made a part
hereof, are true, authentic, and correct copies of the
originals, or, if appropriate, the originals themselves, and
no alterations or modifications thereof have been made.
4. PRESENTATIONS AND WARRANTIES OF SELLER AND PURCHASER.
Seller and Purchaser hereby represent and warrant that there has
been no act or omission by Seller, Purchaser or the
Corporation which would give rise to any valid claim against any
of the parties hereto for a brokerage commission, finder's fee,
or other like payment in connection with the transaction
contemplated hereby.
5. TRANSACTIONS PRIOR TO THE CLOSING. Seller hereby covenants the
following:
a. Conduct of Corporation's Business Until Closing.. Except
as Purchaser may otherwise consent in writing prior to the
Closing Date, Seller will not enter into any transaction
take any action or fail to take any action which would
result in, or could be reasonably expected to result in or
cause, any of the representations and warranties of Seller
contained in this Agreement, to be not true on the Closing
Date.
b. Resignations. Seller will deliver to Purchaser prior to
the Closing Date the resignation of each director and
officer of the Corporation, each such resignation to be
effective on the Closing Date.
C. Satisfactions. Seller will deliver to Purchaser prior to
the Closing Date a satisfaction of any mortgage and lien
holder of the Corporation's Property, satisfactory
in form and substance to the Purchaser and his counsel
indicating that the then outstanding unpaid principal
balance of any promissory note secured thereby has been paid
in full prior to or simultaneously with the Closing (if
any), except mortgages for real property, which the
purchaser shall assume.
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d. Advice of Changes. Between the date hereof and the
Closing Date, Seller will promptly advise Purchaser in
writing of any fact which, if existing or known at the date
hereof, would have been required to be set fourth herein or
disclosed pursuant to this Agreement, or which would
represent a material fact the disclosure of which would be
relevant to the Purchaser.
6. EXPENSES. Each of the parties hereto shall pay its own expense
in connection with this Agreement and the transactions
contemplated hereby, including the fees and expenses of its
counsel and its certified public accountants and other experts.
7. GENERAL.
a. Survival of Representations and Warranties. Each of the
parties to this Agreement covenants and agrees that the
Seller's representations, warranties, covenants and
statements and agreements contained in this Agreement and
the exhibits heretof, and in any documents delivered by
Seller to Purchaser in connection herewith, shall survive
the Closing Date and terminate on the Second anniversary of
such date, except, as set forth in this Agreement, the
exhibits hereto or in the documents and papers delivered by
Seller to Purchaser in connection herewith, there are no
other agreements, representations, warranties or covenants
by or among the parties hereto with respect to the subject
matter hereof.
b. Waivers. No action taken pursuant to this Agreement,
including any investigation by or on behalf of any party
shall be deemed to constitute a waiver by the party taking
such action or compliance with any representation, warranty,
covenant or agreement contained herein, therein and in any
documents delivered in connection herewith or therewith. The
waiver by any party hereto of a breach of any provisions of
this agreement shall not operate or be construed as a waiver
of any subsequent breach.
C. Notices. All notices, requests, demands and other
communications which are required or may be given under this
Agreement shall be in writing and shall be deemed to have
been duly given if delivered or mailed, first class mail,
postage prepaid.
To Seller
The Shadow Ridge Water Company
Xxxx Xxxxxx Xxx 0000
Xxxxxxxx, Xxxxxx, 00000
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To Purchaser
The Great Basin Water Company
000 Xxxx Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxx, Xxxxxx, 00000
or to such other address as such party shall have specified
by notice in writing to the other party.
d. Entire Agreement. This Agreement (including the exhibits
hereto and all documents and papers delivered by Seller
pursuant hereto and any written amendments hereof executed
by the parties hereto) constitutes the entire Agreement and
supersedes all prior agreements and understandings, oral and
written, between the parties hereto with respect to the
subject matter hereof.
e. Sections and Other Headings. The Section and other
headings contained in this Agreement are for reference
purposes only and shall not affect the meaning or
interpretation of this Agreement.
f. Governing Law. This agreement, and all transactions
contemplated hereby, shall be governed by, construed and
enforced in accordance with the laws of the State of Nevada.
The parties herein waive trail by jury and agree to Submit
to the personal jurisdiction and venue of a court of subject
matter jurisdiction located in Xxxxx County, State of
Nevada. In the event that litigation results from or arises
out of this Agreement or the performance thereof, the
parties agree to reimburse the prevailing party's
reasonable attorney's fees, Court costs, and all other
expenses whether or not taxable by the court as costs, in
addition to any other relief to which the prevailing party
may be entitled. In such event, no action shall be
entertained by said court or any court of competent
jurisdiction if filed more than one year subsequent to the
date the cause(s) of action actually accrued regardless of
whether damages were otherwise as of said time calculable.
g. Conditions Precedent. The Conditions Precedent to the
enforcability of this Agreement are outlined in Exhibit "E'"
attached hereto and made a part hereof. In the event that
said Conditions Precent are not fulfilled by -the
appropriate dates thereof, this Agreement shall be deemed
null and void to the Purchaser forthwith.
h. Treasury Stock. It is understood and agreed by the
Purchaser that none of the consideration furnished by the
Purchaser hereunder, shall be for treasury stock and such
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consideration, subject to the terms hereof, shall be the
sole property of the Seller.
i. Contractual Procedures. Unless specifically disallowed by
law, should litigation arise hereunder, service of process
therefor may be obtained through certified (nail, return
receipt requested; the parties hereto waiving any and all
rights they may have to object to the method by which
service was perfected.
IN WITNESS WHEREOF, this Agreement has been executed by each of
the individual parties hereto and signed by an officer thereuntc,
duly authorized and attested under the Corporate seal by the
Secretary of the corporate party hereto, all on the date first
above written.
Signed, sealed and delivered in the presence of:
[CORPORATE SEAL]
Purchaser
By:/s/Xxx X. Xxxxxx
/s/Parry X. Xxxxxx It's Chairman of the Board of Directors
Witness Attest:/s/Xxxxxx X. Xxxxx
It's Secretary
Witness
/s/Xxxx X. Xxxxxxxxxx Seller
Witness
By:/s/Xxxxxx X.Xxxxxxxxxxxx
It's President
/s/Xxxx X. Xxxxxxxxxx Attest:/s/Xxxxxxx X. Xxxxxxxxx
Witness It's Secretary
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EXHIBIT "A"
AMOUNT AND PAYMENT OF PURCHASE PRICE
A. Consideration - As total consideration for the purchase
and sale of the Corporations Stock, pursuant to this
Agreement, the Purchaser shall pay to the Seller One Share
of Investment Stock for each Share of the Stock received
from the Seller (the Sum), such total consideration to be
referred to in this Agreement as the "Purchase Price".
b Payment. The Purchase Price shall be paid as follows;
i. One Million (1,000,000) shares of Stock of the Great
Basin Water Company valued at Two Dollars per share, or
total value of Two Million Dollars ($2,00.000.00) to be
delivered to the Seller within Sixty Days from the
final execution of this agreement.
iii. Check of Purchaser in the sum of the equal amount
of accounts payable to be delivered to Seller within
thirty days of the final closing and upon Purchasers
further Board of Directors Acceptance of the books and
records of the Corporation, which payment by the
Purchaser shall address the closing held on the thirty
days after the final closing which is adequate time for
the receipt of any bills and to insure that the
Corporations liabilities have been fully satisfied and
Liquidated by the Seller.
C. In the event that the Purchaser, after a complete review
of the Corporation's books, records, financial statements,
sales tax receipts, bank statements, check books, and any
other document required by Purchaser to verify the standing,
status or performance of the Corporation, does not approve
said purchase, then, in that event, all deposits paid to
that date shall be returned to Purchaser with no further
liability, responsibility or obligation.
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