STOCK PURCHASE AGREEMENT
------------------------
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made this
20th day of September, 2001 by and among J. Xxxxxxx Xxxxxx, (the
"Seller"), Xxxxx Xxxxxxx, Xxxxxxx Xxxxxxxx and Xxxxx Xxxxxx (each,
a "Purchaser" and collectively the "Purchasers"), Copper Valley
Minerals, Ltd., a Nevada corporation ("CVM")
W I T N E S S E T H :
WHEREAS, the Seller owns directly one million, two hundred
thousand (1,200,000) shares of common stock of CVM;
WHEREAS, the Purchasers desire to purchase an aggregate of one
million, two hundred thousand (1,200,000) shares of common stock of
CVM (the "Shares"), from the Seller on the terms and conditions set
forth in this Agreement and the attached Exhibit A; and
WHEREAS, the Seller desires to sell the Shares to the
Purchasers on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual premises and
covenants herein contained, and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the Seller and the Purchasers hereby agree as
follows:
1. Incorporation by Reference. The above recitals are herein
incorporated by reference.
2. Purchase and Sale. The Purchasers shall purchase from the
Seller, and the Seller shall sell to the Purchasers, the Shares on
the terms and conditions of this Agreement.
3. Consideration/Purchase Price. In consideration of the
transfer by the Seller of the Shares to the Purchasers, the
Purchasers shall transfer to Seller the sum of US $_329,675 (the
"Purchase Price"), representing payment for the Shares which shall
be transferred by wire transfer on the date hereof. Further to the
above, and concurrent with the payment of the Purchase Price by the
Purchasers to the Seller, Purchasers shall cause the sum of US $
42,275 to be paid by wire transfer to Formusoft, Inc. to retire
outstanding loans and interest owing to Formusoft, Inc. by CVM.
Delivery of the sums set out herein will not be effective until
such time as counsel for Seller has confirmed receipt of the wire
transfer of the Purchase Price and the amounts owing to Formusoft,
Inc.
4. Obligations of Seller. Upon the date hereof, Seller shall
deliver the following to the Purchasers or its designee (a) the
Shares (duly endorsed for transfer with signatures guaranteed);
(b) a receipt for the Purchase Price delivered to Seller by the
Purchasers, which incorporates the terms of Section 3 hereof; and a
release from Formusoft, Inc. in regard to the amounts being paid to
Formusoft as set out in Section 3 hereof.
5. Obligations of the Purchasers. Upon the date hereof, the
Purchasers shall deliver to the Seller the Purchase Price pursuant
to the terms of Section 3 of this Agreement.
6. Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of
counsel for Purchasers, The Xxxx Law Group, 000 Xxxxxx Xxxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxxxxxxx, 00000, or at such other place
mutually agreed upon between Purchasers and Seller, to be effective
as of the date hereof.
7. Representations and Warranties of the Seller and CVM.
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7.1 Authority of Seller, Consents; Execution of Agreement.
Seller has all requisite power, authority, and capacity to enter
into this Agreement and to perform the transactions and obligations
to be performed by it hereunder. This Agreement constitutes a
valid and legally binding obligation of Seller, enforceable in
accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws.
7.2 Affiliate Status. The Seller owns, directly or
indirectly, one million, two hundred thousand (1,200,000) shares of
CVM's Common Stock and has been during the past ninety (90) days,
an officer, director, principal shareholder and affiliate of the
Company as that term is defined in of Rule 144 (a)(1) of the
Securities Act of 1933 (the "Securities Act").
7.3 Ownership of Shares. The Shares are free and clear of
all liens, pledges, hypothecation, option, contract and other
encumbrance, except for such restrictions as may appear on the face
of the certificate, or as provided in this Agreement and pursuant
to applicable law.
7.4 The Shares were acquired from CVM by the Seller on April 1, 1999.
7.5 Restricted Securities. The Shares were acquired by the
Seller from CVM on April 1, 1999 for a purchase price of $0.005 per
share in a transaction that was exempt from registration under the
Securities Act of 1933 and the Shares are "restricted securities"
as defined in Rule 144(a)(3) of the Securities Act of 1933.
7.6 Subsidiaries. Other than the Shares, Seller does not own, directly or
indirectly, any capital stock or other equity securities of any
corporation, or have any direct or indirect equity or ownership
interest in any business or other person, which owns any of CVM's
outstanding equity. CVM has no subsidiaries.
7.7 Capitalization. The authorized capital stock of CVM consists of
100,000,000 shares of CVM common stock, with a par value of $0.001 per
share. As of the date of this Agreement, 2.033,000 shares of CVM common
stock are issued and outstanding. and (ii) no shares of CVM Common
Stock are reserved for issuance. CVM has no outstanding options and
has no stock option plan. All the outstanding shares of CVM's
capital stock are duly authorized, validly issued, fully paid and
nonassessable. There is no voting debt of CVM issued and
outstanding. Except as set forth above, (x) there are no shares of
capital stock of CVM authorized, issued or
outstanding; (y) there
are no existing options, warrants, calls, pre-emptive rights,
subscriptions or other rights, agreements, arrangements,
understandings or commitments of any character, relating to the
issued or unissued capital stock of CVM , obligating CVM to issue,
transfer or sell or cause to be issued, transferred or sold any
shares of capital stock or voting debt of, or other equity interest
in, CVM or securities convertible into or exchangeable for such
shares, equity interests or voting debt, or obligating CVM to
grant, extend or enter into any such option, warrant, call,
subscription or other right, agreement, arrangement or commitment;
and (z) there are no outstanding contractual obligations of CVM to
repurchase, redeem or otherwise acquire any shares of CVM common
stock, or the capital stock of CVM, or affiliates of CVM or to
provide funds to make any investment (in the form of a loan,
capital contribution or otherwise) in any other entity or person.
There are no voting trusts or other agreements or
understandings to which CVM is a party with respect to the voting
of the Shares.
7.8 Authorization, Validity of Agreement, Necessary Action.
CVM has, or will have at Closing, all necessary corporate
power and authority to execute and deliver this Agreement and to
perform the obligations under this Agreement. The execution and
delivery of, and performance by Seller and CVM of this Agreement,
have been duly authorized by the board of directors of CVM, and no
other corporate action on the part of CVM is necessary to authorize
the execution and delivery by Seller and CVM of this Agreement.
This Agreement has been duly executed and delivered by Seller, and,
assuming due and valid authorization, execution and delivery by
Seller and CVM, is a valid and binding obligation of Seller and
CVM, enforceable against each of them in accordance with its terms
except to the extent that enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally or by
general equitable principles.
7.9 Consents and Approvals, No Violations.
Except for the filings, permits, authorizations, consents
and approvals as may be required under, and other applicable
requirements with respect to the Securities Act, the Securities and
Exchange Act of 1934 (the Exchange Act"), the HSR Act, foreign
antitrust laws, state securities or blue sky laws, the Nasdaq
National Market and the Over-the-Counter Bulletin Board, none of
the execution or delivery or performance by either Seller or CVM of
its obligations under this Agreement, will (a) conflict with or
result in any breach of any provision of the articles of
incorporation or by-laws of CVM; (b) require any filing with, or
permit, authorization, consent or approval of, any governmental
entity; (c) 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 material terms, conditions or provisions of any
note, bond, mortgage, indenture, lease, license, contract,
agreement or other instrument or obligation to which either Seller
or CVM, is a party or by which any of them or any of their
respective properties or assets may be bound; or (d) violate any
order, writ, injunction, decree, statute, rule or regulation
applicable to either Seller or CVM,, or any of their properties or
assets.
7.10 Brokers or Finders
(a). Neither Seller nor CVM, or their respective
affiliates, has entered into any agreement or arrangement entitling
any agent, broker, investment banker, financial
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advisor or other firm or person to any brokers' or finders' fee or any other
commission or similar fee in connection with the purchase and sale
of the Shares.
7.11 Reports and Financial Statements.
---------------------------------
(a) CVM has filed all required CVM SEC Documents, as
hereinafter defined, with the SEC. As of their respective
dates or, if amended, as of the date of the last such
amendment filed prior to the date of this Agreement, the
CVM SEC Documents, including any financial statements or
schedules included therein (a) did not contain any untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to
make the statements made therein, in the light of the
circumstances under which they were made, not misleading
and (b) complied in all material respects with the
applicable requirements of the Exchange Act and the
Securities Act, as the case may be.
Each of CVM's financial statements accompanying all CVM SEC
Documents have been prepared from, and are in accordance
with, the books and records of CVM and its subsidiaries.
The CVM financial statements complied, as of their
respective dates, with applicable accounting requirements
and rules and regulations of the SEC. The CVM financial
statements have been prepared in accordance with generally
accepted accounting principles ("GAAP") applied on a
consistent basis (except as may be indicated in the notes
thereto and subject, in the case of interim condensed
consolidated financial statements, to normal, recurring and
immaterial year-end adjustments and the absence of certain
notes) and fairly present, (i) the consolidated financial
position of CVM as of the dates thereof and (ii) the
consolidated results of operations, changes in
shareholders' equity and cash flows of CVM for the periods
presented therein. The "SEC Documents" shall include each
form, report, schedule, statement or other document
required to be filed by CVM through the date of this
Agreement under the Exchange Act or the Securities Act,
including any amendment to such document, whether or not
such amendment is required to be so filed.
7.12 Books and Records.
The books of account, minute books, stock record books and
other records of CVM and its subsidiaries are complete and correct
in all material respects and have been maintained in accordance
with sound business practices and the requirements of Section
13(b)(2) of the Exchange Act, including an adequate system of
internal controls. The minute books of CVM contain accurate and
complete records of all meetings held of, and corporate action
taken by, the shareholders, CVM's board of directors and committees
thereof, and no meeting of any of such shareholders, CVM's board of
directors or such committees has been held for which minutes have
not been prepared and are not contained in such minute books.
7.13 No Undisclosed Liabilities.
Except (a) as disclosed in the CVM financial statements,
and (b) for liabilities and obligations incurred in the ordinary
course of business and consistent with past practices since the
filing of the 10-Q, as hereinafter defined, CVM has no
liabilities or obligations of any nature, whether or not accrued,
contingent or otherwise, that, individually or in the
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aggregate, have, or could reasonably be expected to have, a CVM
material adverse effect on the business and operations of CVM.
7.14 Absence of Certain Changes.
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(a) Since the filing of CVM's most recent 10-QSB for the
quarterly period ending July 31, 2001, (the "10-Q"), except
as disclosed in the CVM SEC Documents filed prior to the
date hereof, (a) there has not been any material adverse
change, nor is any such change reasonably expected, in the
assets, business, properties, prospectus, operations or
condition (financial or otherwise) of each of CVM , (b)
CVM has not participated in any transaction material to
the assets, business, properties, prospects, operations or
condition (financial or otherwise) of CVM, or otherwise
acted outside the ordinary course of business, including,
without limitation, declaring or paying any dividend or
declaring or making any distribution to its stockholders
except out of the earnings of CVM, (c) each of CVM has not
increased the compensation of any of its officers or the
rate of pay of any of its employees, except as part of
regular compensation increases in the ordinary course of
business, (d)CVM has not created or assumed any lien on a
material asset of CVM ; (e) CVM has not entered into any
contractual obligation, other than in the ordinary course
of business and (f) there has not occurred a material
change in the accounting principles or practices of CVM
except as required by reason of change in GAAP.
(b) The 10-Q sets forth the amount of all material
indebtedness of CVM as of the thereof, the liens that
relate to such indebtedness and that encumber the assets of
CVM and the name of each lender thereof.
7.15 Litigation.
There is no action, suit, inquiry, proceeding or
investigation by or before any governmental entity pending or, to
the best knowledge of Seller or CVM, threatened, against or
involving Seller or CVM or which may question or challenge the
validity of this Agreement or any action taken or to be taken by
Seller or CVM pursuant to this Agreement. There is no, and
neither CVM nor Seller knows or has any reason to know of, any
valid basis for any such action, proceeding or investigation.
Neither Seller, or CVM is in default under or in violation of, nor
to Seller's or CVM's knowledge is there any valid basis for any
claim of default under or violation of, any contract or commitment
or restriction to which Seller or CVM is a party or by which any
of them or any of their assets is bound. Neither Seller or CVM is
subject to any judgment, order or decree which may have an adverse
effect on its business practices or on its ability to acquire any
property or conduct its business in any area. There are no
controversies pending or, to the knowledge of Seller or CVM ,
threatened, which controversies have resulted, or could reasonably
be expected to result, in an action, suit, proceeding, claim,
arbitration or investigation before any agency, court or tribunal,
foreign or domestic which if determined adversely to Seller or CVM
could, individually or in the aggregate, reasonably be expected to
have a material adverse effect on the business of CVM. The
foregoing includes, without limitation, claims pending or
threatened or any basis therefor known by Seller, or CVM involving
the prior employment of any of CVM's employees, their use in
connection with CVM's business of any information or techniques
allegedly proprietary to any of their former employers or their
obligations under any agreements with prior employers.
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7.16 Taxes.
(a) CVM , and any consolidated, combined, unitary or
aggregate group for tax purposes of which CVM is or has
been a member, have (i) properly completed and timely filed
all tax returns required to be filed by them and all such
tax returns are true, correct and complete in all respects,
and (ii) duly paid in full or made adequate accruals in
accordance with GAAP in CVM's financial statements for the
payment of all taxes that are due and payable for all
periods ending on or before the date of this Agreement.
CVM and each of its subsidiaries has no liability for
unpaid taxes accruing after the date of the 10-Q except for
taxes unpaid but incurred in the ordinary course of
business consistent with past practice. In addition, CVM
and each of its subsidiaries will not incur or accrue any
liabilities for taxes (including any taxes in connection
with any distributions of assets) except in the ordinary
course of business. CVM has a tax return due for the fiscal
year ended April 30, 2001.
There is (i) no claim for taxes that is a lien against the
property or assets of Seller, CVM or is being asserted
against Seller, CVM other than liens for taxes not yet due
and payable, (ii) no audit, administrative proceeding or
court proceeding with respect to any taxes or tax returns
of Seller, CVM is being conducted or is pending and no
governmental entity responsible for the imposition of any
tax (a "Tax Authority") has asserted against Seller, CVM
any deficiency or claim for taxes; (iii) no extension of
the statute of limitations on the assessment of any taxes
granted by Seller, CVM and currently in effect, and (iv)
no agreement, contract or arrangement to which Seller, CVM
is a party that may result in the payment of any amount
that would not be deductible by reason of Sections 162(m),
280G or 404 of the Code.
Seller, and CVM , represent that no claim or notice has ever
been submitted by a Tax Authority in a jurisdiction where
Seller or CVM has not filed tax returns that any of them
is or may be subject to taxation by that jurisdiction.
There has been no change in ownership of CVM that has caused
the utilization of any losses of CVM to be limited pursuant
to Section 382 of the Code, and any loss carryovers
reflected on CVM's financial statements are properly
computed and reflected.
(b) CVM has not been and will not be required to include any
material adjustment in taxable income for any tax period
(or portion thereof) pursuant to Section 481 or 263A of the
Code or any comparable provision under state or foreign tax
laws as a result of transactions, events or accounting
methods employed.
(c)
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(d) CVM is not a party to any tax sharing or tax allocation
agreement nor does CVM have any liability or potential
liability to another party under any such agreement, and
has not incurred any liability for taxes of any person
under Treas. Reg. Section 1.1502.6 (or any similar
provision of state, local or foreign law), as a transferee
or successor, by contract or otherwise.
(e) CVM has withheld and paid all taxes required to have
been withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor,
shareholder or other third party.
(f) No power of attorney has been granted by CVM with
respect to any matters relating to taxes that is currently
in effect.
(g) CVM has not settled any claim, audit or administrative
or court proceeding with respect to taxes.
(h) CVM has not filed any disclosures under Section 6662 of
the Code or comparable provisions of state, local or
foreign law to prevent the imposition of penalties with
respect to any tax reporting position taken on any tax
return.
(i) CVM has not been a member of a consolidated, combined or
unitary group of which CVM was not the ultimate parent
corporation.
CVM has in its possession receipts for any taxes paid to
foreign tax authorities. CVM has not been a "personal
holding company" within the meaning of Section 542 of the
Code or a "United States real property holding corporation"
within the meaning of Section 897 of the Code or a "blank
check company".
7.17 Information Supplied.
None of the information supplied or to be supplied by
Seller or CVM specifically for inclusion or incorporation by
reference in any SEC filing or related disclosure document will
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they are made, not misleading. All CVM documentation
and information filed with the SEC has complied as to form in all
material respects with the requirements of the Securities Act and
the Exchange Act and the rules and regulations thereunder.
8. Representations and Warranties of the Purchasers.
-------------------------------------------------
8.1 Authority of the Purchasers; Execution of Agreement. The
Purchasers has all requisite power, authority, and capacity to
enter into this Agreement and to perform the transactions and
obligations to be performed by them hereunder. This Agreement has
been duly executed and delivered by the Purchasers and constitutes
a valid and legally binding obligation of the Purchasers,
enforceable in accordance with its terms, except as enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws.
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8.2 Investment. The Purchasers warrant and acknowledges
that:
8.2.1 it is not, and has not been during the past ninety (90)
days, an officer, director, principal shareholder or affiliate
(as that term is defined in paragraph (a)(1) of Rule 144) of
CVM ;
8.2.2 it is acquiring the Shares for its own account with an
investment intent;
8.2.3 it is an experienced and sophisticated investor, is able
to fend for itself in the transactions contemplated by this
Agreement, and has such knowledge and experience in financial
and business matters that it is capable of evaluating the
risks and merits of acquiring the Shares; and
8.2.4 it is aware that certain of the Shares may not be sold
unless such securities are registered pursuant to the Act or
qualify for an exemption from such registration.
9. Survival of Representations and Warranties of Seller and CVM.
Notwithstanding any right of the Purchasers to fully investigate
the affairs of CVM, the Purchasers shall have the right to rely
fully upon the representations, warranties, covenants and
agreements of either the Seller or CVM contained in this Agreement
or in any document delivered by the Seller or CVM or any of their
representatives, in connection with the transactions contemplated
by this Agreement. All such representations, warranties, covenants
and agreements shall survive the execution and delivery hereof for
twelve (12) months following the Closing.
10. Obligation of Seller to Indemnify. Subject to the limitations
on the survival of representations and warranties contained in
Section 9, Seller hereby agree to indemnify, defend and hold
harmless the Purchasers from and against any losses, liabilities,
damages, deficiencies, costs or expenses (including interest,
penalties and reasonably attorney's fees and disbursements) (a
"Loss") based upon, arising out of or otherwise due to any
inaccuracy in or any breach of any representation, warranty,
covenant or agreement of either Seller or CVM contained in this
Agreement or in any document or other writing delivered pursuant to
this Agreement.
11. Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed to have
been duly given if physically delivered; delivered by overnight
delivery, confirmed telecopy, telegram or courier; or three days
after having been deposited in the United States Mail, as certified
mail with return receipt requested and with postage prepaid,
addressed to the recipient at the address listed at the top of the
first page of this Agreement. Any of the foregoing addresses may
be changed by giving notice of such change in the foregoing manner,
except that notices for changes of address will be effective only
upon receipt.
13. Miscellaneous.
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13.1 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject
matter hereof. It supersedes all prior negotiations, letters and
understandings relating to the subject matter hereof.
13.2 Amendment. This Agreement may not be amended,
supplemented or modified in whole or in part except by an
instrument in writing signed by the party or parties against whom
enforcement of any such amendment, supplement or modification is
sought.
13.3 Choice of Law. This Agreement will be interpreted,
construed and enforced in accordance with the laws of the State of
Washington.
13.4 Enforcement. Should it become necessary for any party to
institute legal action to enforce the terms and conditions of this
Agreement, the successful party will be awarded reasonable
attorneys' fees at all trial and appellate levels, expenses and
costs. Venue for any such action, in addition to any other venue
permitted by statute, will be King County, Washington.
13.5 Binding Nature. This Agreement will be binding upon and
will inure to the benefit of any successor or successors of the
parties to this Agreement.
13.6 Counterparts. This Agreement may be executed in one or
more counterparts, each of which will be deemed an original and all
of which together will constitute one and the same instrument.
13.7 Construction. This Agreement shall be construed within
the fair meaning of each of its terms and not against the party
drafting the document.
13.8 Legal Advice. The parties, as evidenced by their
signatures below, acknowledge that this Agreement has been
presented to their attorneys and that their attorneys have had the
opportunity to review and explain to them the terms and provisions
of the Agreement, and that they fully understand those terms and
provisions.
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IN WITNESS WHEREOF, the parties have respectively caused this
Agreement to be executed on the date first above written.
SELLER:
By: /S/ J. Xxxxxxx Xxxxxx
---------------------------------
Print Name: J. Xxxxxxx Xxxxxx
PURCHASERS:
By:
---------------------------------
Print Name: Xxxxx Xxxxxxx
Title:
------------------------------
By: /S/ Xxxxxxx Xxxxxxxx
---------------------------------
Print Name: Xxxxxxx Xxxxxxxx
Title:
------------------------------
By: /S/ Xxxxx Xxxxxx
---------------------------------
Print Name: Xxxxx Xxxxxx
Title:
------------------------------
COPPER VALLEY MINERALS, LTD.
By: /S/ J. Xxxxxxx Xxxxxx
---------------------------------
Print Name: J. Xxxxxxx Xxxxxx
Title: President
------------------------------
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EXHIBIT A
The following sets forth the names of the Purchasers, the
number of shares purchased and the respective purchase price:
Purchaser Number of Shares Purchase Price
Xxxxx Xxxxxxx 400,000 $109,891
Xxxxxxx Xxxxxxxx 400,000 $109,892
Xxxxx Xxxxxx 400,000 $109,892
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Total: 1,200,000 $329,675
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