Exhibit 99.4
This Agreement (the "Agreement") is made as of the 2nd day of June, 2006
by and between Xxxxxxxx Resources III, Inc., a Nevada corporation whose address
is P. O. Xxx 000000, Xxxxxxxx, Xxxxxxxx 00000 (the "Issuer"), and the
stockholders listed in Exhibit A to this Agreement (each a "Seller" and
collectively, the "Sellers").
W I T N E S S E T H:
WHEREAS, the Sellers are the owners of the shares of the Issuer's common
stock, par value $.001 per share ("Common Stock"), set forth after their
respective names on Exhibit A to this Agreement; and
WHEREAS, the Seller desire to sell to the Issuer, and the Issuer desires
to purchase from the Seller, an aggregate of 3,305,000 shares of Common Stock
(the "Shares"), on and subject to the terms of this Agreement;
WHEREFORE, the parties hereto hereby agree as follows:
1. Sale of the Shares. Subject to the terms and conditions of this
Agreement, and in reliance upon the representations, warranties, covenants and
agreements contained in this Agreement, each Seller shall, severally, sell the
Shares to the Issuer set forth after such Seller's name on Exhibit A to this
Agreement, and the Issuer shall purchase the Shares from the Seller for a total
purchase price (the "Purchase Price") equal to $213,525, with each Seller
receiving the amount set forth in said Exhibit A.
2. Closing.
(a) The purchase and sales of the Shares shall take place at a
closing (the "Closing"), to occur immediately following execution and delivery
of this Agreement.
(b) At the Closing:
(i) The Sellers shall deliver to the Issuer certificates for
the Shares, duly endorsed in form for transfer to the Issuer.
(ii) The Issuer shall pay the purchase price for the Shares.
(iii) The Issuer shall deliver evidence that, as of Closing,
the Issuer has no direct, contingent or other obligations of any kind or any
commitment or contractual obligations of any kind and description, and that all
liabilities and obligations of any kind and description, whether immediate,
direct, contingent or indirect, shall have been cancelled, with the result that
the Issuer has, as of the Closing, no liabilities or obligations of any kind.
(iv) The Issuer shall deliver or cause the Issuer's transfer
agent to deliver a certified copy of the stock ledger of the Issuer listing
every stockholder of record as of the most recent practicable date.
(v) Counsel for the Issuer shall have given its opinion to
the Issuer, which may be relied on by any subsequent purchasers of the Issuer's
capital stock and their counsel, to the effect that all of the issued and
outstanding capital stock has been duly and validly authorized and issued and is
fully paid and non-assessable, was not issued in violation of any preemptive
right or, to the best of such counsel's knowledge, right of first refusal or
other right, and that the issuance of such capital stock was exempt from the
registration requirements of the Securities Act of 1933, as amended, by virtue
of Section 4(2) thereof .
(vi) The Issuer shall deliver a good standing certificate
issued by the Secretary of State of the State of Nevada and the articles of
incorporation of the Issuer, certified by the Secretary of State of the State of
Nevada.
(c) Following the Closing, the Issuer will include, at the
Issuer's expense, all of the presently outstanding shares of Common Stock in the
first registration statement filed by this Issuer or any selling shareholder
after the Closing; provided that the stockholders (i) provide to the Issuer with
all information reasonably requested by the Issuer in connection therewith and
(ii) agree to customary indemnification and contribution provisions acceptable
to the Issuer as long as the Issuer similar agrees to such customary provisions.
(d) The Seller understands that following the Closing, the Issuer
may engage a different accounting firm. At and at any time after the Closing,
the parties shall duly execute, acknowledge and deliver all such further
assignments, conveyances, instruments and documents, and shall take such other
action consistent with the terms of this Agreement to carry out the transactions
contemplated by this Agreement. Without limiting the foregoing, the Issuer
agrees that it shall cause its current management to execute such certificates,
auditor representation letters and other representations ("Certifications") as
the Issuer may reasonably request in order to enable the Issuer to prepare and
file future reports with the Commission, including the Issuer's Report on Form
8-K relating to this Agreement, and shall take such steps as may be necessary to
facilitate the Issuer's auditor's preparation of the financial statements and
its report related thereto for the year ended December 31, 2005. Such
Certifications shall specifically include a representation letter for the
benefit of the Issuer's auditor in the form requested by its auditors. Any such
Certifications shall treat only periods and events prior to Closing.
3. Representations and Warranties of the Issuer and Sellers. The Issuer
and Sellers hereby jointly and severally make the following representations and
warranties to each other and to any persons who acquire the Issuer's capital
stock following the Closing in a transaction characterized as a reverse merger,
provided, that such representations and warranties shall survive the Closing for
a period of one (1) year and provided further that the Sellers make no
representations or warranties other than with respect to itself and the Shares
to be sold hereunder:
(a) The Issuer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Nevada. The Issuer has the
corporate power to own its properties and to carry on its business as now being
conducted and is duly qualified to do business and is in good standing in each
jurisdiction in which the failure to be so qualified and in good standing would
have a material adverse effect on the Issuer. Each Seller has the requisite
power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby and otherwise to carry out his or her
obligations hereunder. The Issuer is not in violation of any of the provisions
of its certificate of incorporation or by-laws. No consent, approval or
agreement of any individual or entity is required to be obtained by the Issuer
in connection with the execution and performance by the Issuer of this Agreement
or the execution and performance by the Issuer of any agreements, instruments or
other obligations entered into in connection with this Agreement. The Issuer has
no subsidiary, and it does
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not have any equity investment or other interest, direct or indirect, in, or any
outstanding loans, advances or guarantees to or on behalf of, any domestic or
foreign individual or entity.
(b) The Issuer has authorized capital stock consisting of
25,000,000 shares of Common Stock, of which 3,336,000 shares, including the
Shares, are presently issued and outstanding. Each Seller owns the Shares listed
after such Seller's name on Exhibit A to this Agreement, free and clear of all
any and all liens, claims, encumbrances, preemptive rights, right of first
refusal and adverse interests of any kind.
(c) Neither the Issuer nor any Seller is a party to any agreement
or understanding pursuant to which any securities of any class of capital stock
are to be issued or created or transferred. The Issuer has not acquired any
shares of Common Stock, and has no formal or informal agreements or
understandings pursuant to which it can or will acquire any shares of Issuer
Common Stock (other than this Agreement). Neither the Issuer nor any Seller nor
any officer, director or 5% stockholder of the Issuer has any agreements, plans,
understandings or proposals, whether formal or informal or whether oral or in
writing, pursuant to which it or he granted or may have issued or granted any
individual or entity any Convertible Security or any interest in the Issuer or
the Issuer's earnings or profits, however defined. As used in this Agreement,
the term "Convertible Securities" shall mean any options, rights, warrants,
convertible debt, equity securities or other instrument or agreement upon the
exercise or conversion of which or upon the exchange of which or pursuant to the
terms of which additional shares of any class of capital stock of the Issuer may
be issued.
(d) There is no private or governmental action, suit, proceeding,
claim, arbitration or investigation pending before any agency, court or
tribunal, foreign or domestic, or, to the Issuer's Best Knowledge, threatened
against the Issuer or any of its properties or any of its officers or directors
(in their capacities as such). There is no judgment, decree or order against the
Issuer that could prevent, enjoin, alter or delay any of the transactions
contemplated by this Agreement. The term "Best Knowledge" of the Issuer shall
mean and include (i) actual knowledge and (ii) that knowledge which a prudent
businessperson would reasonably have obtained in the management of such Person's
business affairs after making due inquiry and exercising the due diligence which
a prudent businessperson should have made or exercised, as applicable, with
respect thereto. Actual or imputed knowledge of any director or officer or
Seller shall be deemed to be knowledge of the Issuer.
(e) There are no material claims, actions, suits, proceedings,
inquiries, labor disputes or investigations (whether or not purportedly on
behalf of the Issuer) pending or, to the Issuer's Best Knowledge, threatened
against the Issuer or any of its assets, at law or in equity or by or before any
governmental entity or in arbitration or mediation. No bankruptcy, receivership
or debtor relief proceedings are pending or, to the best of the Issuer's
knowledge, threatened against the Issuer.
(f) The Issuer has complied with, is not in violation of, and has
not received any notices of violation with respect to, any federal, state, local
or foreign Law, judgment, decree, injunction or order, applicable to it, the
conduct of its business, or the ownership or operation of its business.
References in this Agreement to "Laws" shall refer to any laws, rules or
regulations of any federal, state or local government or any governmental or
quasi-governmental agency, bureau, commission, instrumentality or judicial body
(including, without limitation, any federal or state securities law, regulation,
rule or administrative order).
(g) The Issuer has properly filed, or will, not later than June
15, 2006, file all tax returns required to be filed and has paid all taxes shown
thereon to be due. To the Best Knowledge of
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the Issuer, all tax returns previously filed are true and correct in all
material respects. The Stockholders shall bear the cost of any tax returns that
have not been filed as of the date of this Agreement.
(h) The Issuer has no outstanding liabilities or obligations to
any party except as reflected on the Issuer's Form 10-QSB for the quarter ended
March 31, 2006, other than charges since such date similar to those incurred in
past periods and consistent with past practice, all of which will be discharged
prior to or at the Closing so that, at the Closing, the Issuer will have no
direct, contingent or other obligations of any kind or any commitment or
contractual obligations of any kind and description. The Sellers shall jointly
and severally indemnify the Issuer and hold the Issuer harmless from and against
any loss, damage, liability or expense which the Issuer may sustain from any
liabilities or obligations which it may sustain in the event of a breach of the
representations, warranties and covenants contained in this Section 3(h).
(i) All of the business and financial transactions of the Issuer
have been fully and properly reflected in the books and records of the Issuer in
all material respects and in accordance with generally accepted accounting
principles consistently applied.
(j) The Issuer is current with its reporting obligations under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). None of the
Issuer's filings made pursuant to the Exchange Act (collectively, the "Issuer
SEC Documents") contain any misstatements of material fact or omit to state a
material fact necessary to make the statements made therein not misleading. The
Issuer SEC Documents, as of their respective dates, complied in all material
respects with the requirements of the Exchange Act, and the rules and
regulations of the Commission thereunder, and are available on the Commission's
XXXXX system. The financial statements included in the Issuer SEC Documents
present and reflect, in accordance with generally accepted accounting
principles, consistent applied, the financial condition of the Issuer on the
balance sheet dates and the results of its operations, cash flows and changes in
stockholders' equity for the periods then ended in accordance with generally
accepted accounting principles, consistently applied. The accountants who
audited the Issuer's financial statements are independent, within the meaning of
the Securities Act and are a member of the PCAOB. There has not occurred any
material adverse change, or any development involving a prospective material
adverse change, in the condition, financial or otherwise, or in the earnings,
business or operations of the Issuer, from that set forth in the Issuer's
Quarterly Report on Form 10-QSB for the quarter ended March 31, 2006.
(k) The execution and delivery of this Agreement by the Issuer and
Seller and the consummation of the transactions contemplated by this Agreement
will not result in any material violation of the Issuer's certificate of
incorporation or by-laws, Seller's operating agreement or any applicable Law.
(l) All representations, covenants and warranties of the Issuer
and Sellers contained in this Agreement shall be true and correct on and as of
the Closing Date with the same effect as though the same had been made on and as
of such date.
4. Finder's Fee. Seller represents and warrants that no person is
entitled to receive a finder's fee from Seller in connection with this Agreement
as a result of any action taken by the Issuer or Seller pursuant to this
Agreement, and agrees to indemnify and hold harmless the other party, its
officers, directors and affiliates, in the event of a breach of the
representation and warranty set forth in this Section 4. This representation and
warranty shall survive the Closing.
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5. Termination by Mutual Agreement. This Agreement may be terminated at
any time by mutual consent of the parties hereto, provided that such consent to
terminate is in writing and is signed by each of the parties hereto.
6. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire
agreement of the parties, superseding and terminating any and all prior or
contemporaneous oral and written agreements, understandings or letters of intent
between or among the parties with respect to the subject matter of this
Agreement. No part of this Agreement may be modified or amended, nor may any
right be waived, except by a written instrument which expressly refers to this
Agreement, states that it is a modification or amendment of this Agreement and
is signed by the parties to this Agreement, or, in the case of waiver, by the
party granting the waiver. No course of conduct or dealing or trade usage or
custom and no course of performance shall be relied on or referred to by any
party to contradict, explain or supplement any provision of this Agreement, it
being acknowledged by the parties to this Agreement that this Agreement is
intended to be, and is, the complete and exclusive statement of the agreement
with respect to its subject matter. Any waiver shall be limited to the express
terms thereof and shall not be construed as a waiver of any other provisions or
the same provisions at any other time or under any other circumstances.
(b) Severability. If any section, term or provision of this
Agreement shall to any extent be held or determined to be invalid or
unenforceable, the remaining sections, terms and provisions shall nevertheless
continue in full force and effect.
(c) Notices. All notices provided for in this Agreement shall be
in writing signed by the party giving such notice, and delivered personally or
sent by overnight courier, mail or messenger against receipt thereof or sent by
registered or certified mail, return receipt requested, or by facsimile
transmission or similar means of communication if receipt is confirmed or if
transmission of such notice is confirmed by mail as provided in this Section
6(c). Notices shall be deemed to have been received on the date of personal
delivery or telecopy or attempted delivery. Notice shall be delivered to the
parties at the following addresses:
If to the Issuer: c/o Xx. Xxxxx X. Xxxxxx, President
[address]
With a copy to: Xxxx X. Xxxxxx, Esq.
[address]
If to Seller:
To the addresses set forth on Exhibit
A to this Agreement
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Either party may, by like notice, change the address, person or telecopier
number to which notice shall be sent.
(d) Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of New York applicable to agreements
executed and to be performed wholly within such State, without regard to any
principles of conflicts of law. Each of the parties hereby irrevocably consents
and agrees that any legal or equitable action or proceeding arising under or in
connection with this Agreement shall be brought in the federal or state courts
located in the County of New York in the State of New York, by execution and
delivery of this Agreement, irrevocably submits to and accepts the jurisdiction
of said courts, (iii) waives any defense that such court is not a convenient
forum, and (iv) consent to any service of process made either (x) in the manner
set forth in Section 10(c) of this Agreement (other than by telecopier), or (y)
any other method of service permitted by law.
(e) Waiver of Jury Trial. EACH PARTY HEREBY EXPRESSLY WAIVES ANY
RIGHT TO A TRIAL BY JURY IN THE EVENT OF ANY SUIT, ACTION OR PROCEEDING TO
ENFORCE THIS AGREEMENT OR ANY OTHER ACTION OR PROCEEDING WHICH MAY ARISE OUT OF
OR IN ANY WAY BE CONNECTED WITH THIS AGREEMENT OR ANY OF THE OTHER DOCUMENTS.
(f) Parties to Pay Own Expenses. Each of the parties to this
Agreement shall be responsible and liable for its own expenses incurred in
connection with the preparation of this Agreement, the consummation of the
transactions contemplated by this Agreement and related expenses.
(g) Successors. This Agreement shall be binding upon the parties
and their respective heirs, executors, administrators, legal representatives,
successors and assigns; provided, however, that neither party may assign this
Agreement or any of its rights under this Agreement without the prior written
consent of the other party.
(h) Further Assurances. Each party to this Agreement agrees,
without cost or expense to any other party, to deliver or cause to be delivered
such other documents and instruments as may be reasonably requested by any other
party to this Agreement in order to carry out more fully the provisions of, and
to consummate the transaction contemplated by, this Agreement.
(i) Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
(j) No Strict Construction. The language used in this Agreement
will be deemed to be the language chosen by the parties with the advice of
counsel to express their mutual intent, and no rules of strict construction will
be applied against any party.
(k) Headings. The headings in the Sections of this Agreement are
inserted for convenience only and shall not constitute a part of this Agreement.
[Signatures on following page.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
XXXXXXXX RESOURCES III, INC.
By:___________________________________
Xxxxx X. Xxxxxx, President
______________________________________
Xxxxx X. Xxxxxx, President
______________________________________
Xxxxxxx Saalerno
______________________________________
Xxxx X'Xxxx
______________________________________
Xxxx Xxxxx
______________________________________
Xxxx Xxxxxxxxx
______________________________________
Xxxxxx Xxxxxxxxxx
______________________________________
Xxxx X. Xxxxxx
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Exhibit A
Sellers
Name and Address Number of Shares Purchase Price
---------------- ---------------- --------------
Xxxxx X. Xxxxxx 1,000,000 $62,600
Xxxxxxx Xxxxxxx 1,000,000 62,600
Xxxx X'Xxxx 1,000,000 62,600
Xxxx Xxxxx 150,000 9,690
Xxxx Xxxxxxxxx 100,000 6,465
Xxxx X. Xxxxxx 35,000 2,270
Xxxxxx Xxxxxxxxxx 20,000 7,300
--------- --------
3,305,000 $213,525
========= ========
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