1
EXHIBIT 6.12
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is entered into as of the
15th day of June, 1999 (the "Effective Date") by and between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
("Buyer") and FutureOne, Inc., a Nevada corporation ("Seller"). The Buyer and
Seller are referred to collectively herein as the "Parties."
The Seller owns 100% of the issued and outstanding shares of capital stock
of PRIORITY SYSTEMS, INC., an Arizona corporation ("Priority Systems").
This Agreement contemplates a transaction in which the Buyer will purchase
from the Seller, and the Seller will sell to the Buyer, all of the issued and
outstanding shares of capital stock of Priority Systems (the "Priority Systems
Shares") in return for shares of Seller's common stock and a promissory note.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows:
1. FORM OF THE TRANSACTION. Subject to the terms and conditions of this
Agreement, Buyer agrees to purchase from Seller, and Seller agrees to sell to
Buyer, all of the Priority Systems Shares for the consideration specified in
Section 2 hereof.
2. PURCHASE PRICE. The purchase price for the Priority Systems Shares
("Purchase Price") shall be payable on the Closing Date as follows:
(a) One Hundred Eight Thousand Eight Hundred and Fifty (108,850)
shares of common stock of Seller (the "FutureOne Shares") issued to Buyer shall
be reconveyed to Seller; and
(b) Buyer shall deliver a promissory note (the "Promissory Note") to
Seller in the aggregate principal amount of $50,000.00 in form and substance
identical to the form of Promissory Note annexed hereto as Exhibit A.
3. CLOSING. The closing of the transactions contemplated by this Agreement
(the "Closing") shall take place at the offices of the Seller at 2:00 p.m.,
Arizona time, on the first business day following the satisfaction or waiver of
all conditions to the obligations of the Parties to consummate the transactions
contemplated hereby (other than conditions with respect to actions the
respective Parties will take at the Closing itself) or such other date as the
Buyer and Seller may mutually determine (the "Closing Date"). Notwithstanding
the Closing Date, the Parties hereby acknowledge that all of the transactions
contemplated by this Agreement shall be deemed to have occurred as of the
Effective Date.
1
2
4. REPRESENTATIONS AND WARRANTIES.
(a) Representations and Warranties of the Seller. Seller represents
and warrants to the Buyer that the statements contained in this Section 4(a) are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this Section
4(a)) with respect to itself.
(i) Organization of Seller. The Seller is duly organized,
validly existing, and in good standing under the laws of the State of
Nevada.
(ii) Due Authorization. The Seller has full power and
authority (including full corporate power and authority) to execute and
deliver this Agreement and to perform its obligations hereunder. This
Agreement constitutes the valid and legally binding obligation of the
Seller, enforceable in accordance with its terms and conditions. The
Seller need not give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental
agency in order to consummate the transactions contemplated by this
Agreement.
(iii) Noncontravention. Neither the execution and the delivery
of this Agreement, nor the consummation of the transactions contemplated
hereby, will violate any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which the Seller is
subject or, if the Seller is a corporation, any provision of its charter
or bylaws.
(iv) Priority Systems Shares. The Seller holds of record and
owns beneficially the Priority Systems Shares, free and clear of any
restrictions on transfer (other than restrictions under the Securities Act
of 1933, as amended (the "Securities Act"), and state securities laws),
taxes, security interests, options, warrants, purchase rights, contracts,
commitments, equities, claims, and demands. The Seller is not a party to
any option, warrant, purchase right, or other contract or commitment that
could require the Seller to sell, transfer, or otherwise dispose of any
capital stock of Priority Systems (other than this Agreement).
(v) Disclaimer of Other Representations and Warranties. Except
as expressly set forth in this Section 4, the Seller makes no
representation or warranty, express or implied, at law or in equity, in
respect of Priority Systems or any of its assets, liabilities or
operations, including, without limitation, with respect to merchantability
or fitness for any particular purpose, and any such other representations
or warranties are hereby expressly disclaimed.
(b) Representations and Warranties of the Buyer. The Buyer
represents and warrants to Seller that the statements contained in this Section
4(b) are correct and complete as of the date of this Agreement and will be
correct and complete as of the Closing Date (as though made then and as though
the Closing Date were substituted for the date of this Agreement throughout this
Section 4(b)).
(i) Authorization of Transaction. The Buyer has full power and
authority to execute and deliver this Agreement and to perform his
obligations hereunder.
2
3
This Agreement constitutes the valid and legally binding obligation of the
Buyer, enforceable in accordance with its terms and conditions. The Buyer
need not give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental
agency in order to consummate the transactions contemplated by this
Agreement.
(ii) Noncontravention. Neither the execution and the delivery
of this Agreement, nor the consummation of the transactions contemplated
hereby, will (A) violate any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction
of any government, governmental agency, or court to which the Buyer is
subject or (B) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, instrument, or other arrangement to
which the Buyer is a party or by which it is bound or to which any of his
assets is subject.
(iii) Prior and Current Knowledge of Buyer. Buyer has
controlled and operated the business operations of Priority Systems as its
President and as a member of its Board of Directors since Priority
Systems' date of incorporation through the date hereof and, as a result,
has full knowledge of the legal, financial and business affairs of
Priority Systems. Buyer hereby acknowledges and agrees that Buyer is
purchasing the Priority Systems Shares on an "as-is, where-is" basis.
(iv) FutureOne Shares. The Buyer holds of record and owns
beneficially the FutureOne Shares, free and clear of any restrictions on
transfer (other than restrictions under the Securities Act and state
securities laws), taxes, security interests, options, warrants, purchase
rights, contracts, commitments, equities, claims, and demands. The Buyer
is not a party to any option, warrant, purchase right, or other contract
or commitment that could require the Buyer to sell, transfer, or otherwise
dispose of the FutureOne Shares (other than this Agreement).
(v) Investment. Buyer represents, warrants and confirms he (A)
understands that the Priority Systems Shares have not been, and will not
be, registered under the Securities Ace or under any state securities
laws, and are being offered and sold in reliance upon federal and state
exemptions for transactions not involving any public offering, (B) is
acquiring the Priority Systems Shares solely for his or its own account
for investment purposes, and not with a view to the distribution thereof,
(C) is a sophisticated investor with knowledge and experience in business
and financial matters, (D) has received certain information concerning
Priority Systems and has had the opportunity to obtain additional
information as desired in order to evaluate the merits and the risks
inherent in holding the Priority Systems Shares, (E) is able to bear the
economic risk and lack of liquidity inherent in holding the Priority
Systems Shares, and (F) is an Accredited Investor (as such term is defined
in Rule 501 of Regulation D under the Securities Act).
(vi) Experts. Buyer, in determining to enter into this
Agreement and effect the transactions contemplated hereunder, has relied
solely upon the advice of his legal counsel and accountants or other
financial advisors with respect to the tax and other consequences involved
in consummating the transactions contemplated hereunder.
3
4
(c) Representations and Warranties of the Parties. The Parties
hereby acknowledge that Seller has advanced approximately $335,000 to Priority
Systems since Seller acquired Priority Systems from Buyer on September 29, 1998
to (i) repay existing credit lines of Priority Systems, (ii) pay for costs of
goods and services provided by Priority Systems and (iii) pay operating losses
experienced by Priority Systems. The Parties further acknowledge that certain
assets included on Schedule 6(d) attached hereto are being retained by Seller to
repay Seller for Seller's advances to Priority Systems described in this Section
4(c).
5. CONDITIONS PRECEDENT TO OBLIGATIONS OF PARTIES. The obligations of the
Parties to consummate the transactions contemplated by this Agreement are
subject to the satisfaction on or prior to Closing of each of the following
conditions, except as the Parties may waive in writing:
(a) Representations and Warranties True. Each of the representations
and warranties of the Parties contained in this Agreement shall have been true
and correct, as of the Effective Date, when made and at the time of Closing.
(b) No Litigation. There shall be no action, proceeding, or
threatened, pending or actual litigation to enjoin, restrain, or prohibit the
consummation of the transactions contemplated by this Agreement or which would
have the effect, if successful, of imposing any liability upon Seller.
(c) Compliance with Agreement. The Parties shall have complied with
all agreements and covenants applicable to them and contained in this Agreement.
(d) Employees. Priority Systems shall terminate all existing
employment agreements that were entered into while Priority Systems was a
wholly-owned subsidiary of Seller, including, without limitation, the employment
agreement between Priority Systems and Buyer, dated September 29, 1998 (the
"Buyer's Employment Agreement"). The Parties confirm and acknowledge that no
further compensation, bonuses or other benefits relating to past or future
services will remain due and outstanding to Priority Systems' employees,
including, without limitation, Buyer, under such employment agreements or any
other employment arrangements. Notwithstanding the foregoing, the terms and
conditions set forth in Sections 9 through 15 of the Buyer's Employment
Agreement shall survive the Closing and remain in full force and effect in
accordance with Buyer's Employment Agreement. As of the Closing Date, the
following employees of Priority Systems shall be terminated as employees of
Priority Systems and be retained by Seller: ▇▇▇▇ ▇▇▇▇▇, Colby Northern, ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇▇▇▇▇▇.
(e) Resignations. Except for Buyer, all officers and directors of
Priority Systems, including, without limitation, ▇▇▇▇▇▇▇ ▇. Northern, ▇▇▇▇ ▇.
▇▇▇▇, ▇▇▇▇▇ Northern, and ▇▇▇▇ ▇▇▇▇, shall resign as directors and/or officers
of Priority Systems, as the case may be.
(f) Tax Return. On or prior to Closing, Buyer shall deliver to
Seller a copy of Priority Systems' June 30, 1998 federal tax returns on Form
1120 as filed with the Internal Revenue Service.
(g) Corporate Records. As of the Closing Date, Seller shall deliver
all original corporate records of Priority Systems to Buyer. Seller shall have
the right to retain copies of all corporate records of Priority Systems
delivered to Buyer under this Section 6(i).
4
5
6. FURTHER AGREEMENTS. The Parties hereby agree to the following.
(a) Leases. Seller shall assume the leases held by Priority Systems
with respect to the offices located at ▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇ and the apartment located at Arcadia Cove Apartments, ▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇. ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
(b) Accounts. Buyer obtained new bank accounts for Priority Systems
as of the Effective Date and the Parties hereby acknowledge that all bank
accounts of Priority Systems existing as of the date of this Agreement shall be
closed on or prior to Closing or as soon as all receivables of Priority Systems
assigned to the Seller as set forth on Schedule 6(d) attached hereto have been
collected.
(c) Insurance. As of the Effective Date, the Parties hereby
acknowledge Priority Systems shall be removed from Seller's liability insurance
policy and Section 125 Plan.
(d) Certain Assets and Liabilities. All of the assets and
liabilities set forth on Schedule 6(d) attached hereto, including certain assets
and liabilities of Priority Systems' Kachina International Division and Priority
Systems' Phoenix operations, are hereby assigned to Seller by Priority Systems
and, as a result, shall be removed from the books of Priority Systems and
included on the books of Seller as of the Effective Date. Buyer acknowledges
that neither he nor Priority Systems shall have any right, title or interest in
the assets set forth on Schedule 6(d) attached hereto upon the consummation of
the transactions contemplated by this Agreement. The Parties acknowledge that
all assets and liabilities of Priority Systems not included on Schedule 6(d)
shall remain the assets and liabilities of Priority Systems upon Closing. The
Parties further acknowledge that the accounts receivables that shall remain on
the books of Priority Systems as of the Effective Date are approximately equal
to the accounts payable on the books of Priority Systems as of the Effective
Date.
(e) Customers. All of the customers of Priority Systems set forth on
Schedule 6(e) attached hereto are hereby assigned to Seller by Priority Systems
as of the Effective Date. The Parties hereby acknowledge that it is their intent
that only those customers of Priority Systems located in Lake Havasu City,
Arizona shall remain customers of Priority Systems upon the consummation of the
transactions contemplated by this Agreement. The Parties further acknowledge
that in the event there is a dispute with respect to each Party's respective
right to any current or past customer of Priority Systems, other than those
customers located in Lake Havasu City, Arizona, Seller shall, in its sole
discretion, determine which Party shall have the right to such customer. Buyer
acknowledges that neither he nor Priority Systems shall have any right or
interest to such customers set forth on Schedule 6(e) attached hereto upon the
consummation of the transactions contemplated by this Agreement.
(f) Benefits. As of the Effective Date, the employees of Priority
Systems shall no longer be eligible to participate in Seller's 401(k) Plan or
any other employee benefit plan of Seller.
(g) Financial Records of Priority Systems. Seller may retain all
financial records of Priority Systems, including, without limitation, paid
invoices, payroll records, billing records, canceled checks and bank statements,
until completion of Seller's audited financial statements for the year ended
September 30, 1999. Seller shall make such financial records available to Buyer
as requested. Seller shall cooperate with Buyer to transfer existing Quick
5
6
Books data relating to Priority Systems to Buyer. Buyer shall be responsible to
provide Priority Systems with its own Intuit Quick Books software to use the
existing Priority Systems data, as currently maintained by Seller. Seller shall
retain a complete copy of the Quick Books data base for audit purposes.
(h) Future Cooperation. The Parties agree to cooperate in assisting
each other by providing information that may be required from or in the
possession of the other Party that is necessary to carry on such Party's
business, including, without limitation, fulfilling governmental agency
requests, meeting audit requirements or answering customer or vendor questions.
7. INDEMNIFICATION. Buyer hereby agrees to indemnify, hold harmless and
defend Seller and Seller's officers, directors, employees and agents for, from
and against any and all claims that may arise from (i) any and all acts, actions
or omissions, whether intentional or otherwise, of Buyer or Priority Systems
that may have occurred prior to Seller's acquisition of Priority Systems on
September 29, 1998 or after the Effective Date, or (ii) Buyer's breach of his
representations, warranties and covenants contained herein.
8. GENERAL.
(a) Notices. Any notice hereunder to a Party shall be deemed to be
properly served in writing and personally delivered or mailed to:
In the case of Priority Systems:
Priority Systems, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President
In the case of FutureOne:
FutureOne, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇-▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. Northern, President
or to such other address as may have been furnished in writing by such Party to
the other Party to this Agreement, and shall be deemed to have been given as of
the time delivered or, if mailed, as of the time acknowledged as received if
mailed registered or certified mail, postage prepaid, it being the intention
that all notices pursuant hereto shall be effective only upon receipt.
(b) Interpretations. To the extent permitted by the context in which
used; (a) words in the singular number shall include the plural, words in the
masculine gender shall include the feminine and neuter, and vice versa; and (b)
references to "persons" or "parties" in this Agreement shall be deemed to refer
to natural persons, corporations, and all other entities. This instrument shall
be construed in accordance with the fair meaning of its language, and shall not
be construed for or against the party drafting it, solely because of such fact.
6
7
(c) Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed, shall constitute an original copy
hereof, but all of which together shall constitute one and the same document.
(d) Section Headings. The section headings herein have been inserted
for convenience of reference only and shall in no way modify or restrict any of
the terms or provisions hereof.
(e) Entire Agreement. This Agreement and the exhibits and schedules
attached hereto set forth the entire understanding of the Parties with respect
to the transactions contemplated hereby, and any previous agreements or
understandings between the Parties regarding the subject matter hereof are
superseded by this Agreement.
(f) Non-Assignability. The obligations of this Agreement are
personal to each Party, and neither the rights nor obligations under this
Agreement may be assigned or transferred by any Party in any manner whatsoever,
nor are such rights or obligations subject to involuntary alienation, assignment
or transfer.
(g) Governing Law. This Agreement shall be construed in accordance
with and governed by the laws of the State of Arizona without regard to its
conflicts of law principles.
(h) Severability. In the event any term or provision of this
Agreement is declared to be invalid or illegal, for any reason, this Agreement
shall remain in full force and effect and the same shall be interpreted as
though such invalid or illegal provision were not a part hereof.
(i) Waiver of Terms. Any of the terms and conditions of this
Agreement, to the extent permitted by law, may be waived in writing at any time
by any Party. Such action shall be evidenced by written notice signed by Buyer
or an authorized representative of Seller taking such action.
(j) Cooperation. Subject to the terms and conditions herein
provided, each of the Parties hereto shall use its best lawful efforts to take,
or cause to be taken, such action, to execute and deliver, or cause to be
delivered, such additional documents and instruments and to do or cause to be
done all things necessary, proper or advisable, under the provisions of this
Agreement and under applicable law to consummate and make effective the
transactions contemplated by this Agreement.
(k) Arbitration; Exclusive Jurisdiction and Venue. The Parties
hereby agree to exclusively submit all controversies, claims, and matters of
difference to arbitration in Phoenix, Arizona, according to the rules and
practices of the American Arbitration Association from time to time in force,
except to the extent that such rules and practices are inconsistent with the
terms of this Agreement. This submission and agreement to arbitrate shall be
specifically enforceable. The arbitrator shall exclusively apply Arizona law as
though he or she were bound by the applicable statutes and precedents in case
law. The arbitrator shall have the power to issue any award, judgment, decree,
or order of relief that a court of law or equity could issue under Arizona law,
including but not limited to money damages, specific performance, or injunctive
relief. In the event that any party refuses to submit to arbitration, the party
that has submitted to arbitration shall be empowered to file the appropriate
action in a court in Maricopa County,
7
8
Arizona. In all disputes, the non-prevailing party shall be pay the reasonable
attorneys' fees and costs of the prevailing party.
(l) Enforcement. The failure of either Party to enforce any
provision of this Agreement shall not be construed as a waiver or limitation of
that Party's right to subsequently enforce and compel strict compliance with
every provision of this Agreement.
(m) Professional Advice, Fees and Costs. Each Party has relied on
its own professional legal, accounting and tax advisors in determining the
legal, accounting and income tax effects of the transactions contemplated by
this Agreement on such Party. Except as otherwise provided herein, each Party
hereto shall pay its own expenses incurred in connection with this Agreement and
the consummation of the transactions contemplated by this Agreement.
(n) Amendment of Agreement. Notwithstanding anything to the contrary
in this Agreement, to the extent permitted by law, this Agreement may be
amended, supplemented or interpreted at any time by written instrument duly
executed by all Parties hereto.
[Signature Page Follows]
8
9
IN WITNESS WHEREOF, the parties hereto have caused this Stock Purchase
Agreement to be executed as of the day first above written.
FUTUREONE, INC., a Nevada corporation
By:________________________________________
Name:______________________________________
Title:_____________________________________
___________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, an individual
9
