STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is entered into this 21st day of
February, 2001, by and between I) WHISPERING OAKS INTERNATIONAL, INC., a Texas
corporation, domiciled at Dallas, Texas (hereinafter "Whispering"); II)
LAGOSTAR TRADING S.A., an Uruguayan corporation, domiciled at Montevideo,
Uruguay (hereinafter the "Company"); and III) XXXX XXXXX XXXX, XXXXXXX XXXXXX
XXXX, XXXXXX XXXX, AND XXXXX XXXXXX XXXX, all individual shareholders of the
Company and domiciled at 00 xx Xxxx 000, xxxx 0, Xxxxxxxxxx Xxxxxxx (hereinafter
referred to collectively as the "Shareholders" and each individually as a
"Shareholder").
PREAMBLE
Whispering desires to purchase all of the issued and outstanding shares of
capital stock of the Company (hereinafter the "Company Shares") in exchange for
one hundred and fifty thousand (150,000) shares of common stock of Whispering
("Whispering Shares"). The Shareholders own all of the Company Shares, and have
agreed to sell the Shares upon the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the premises and the mutual representations,
warranties, covenants, and agreements herein contained, the parties hereto have
agreed and do hereby agree as follows:
1. PURCHASE OF SHARES. Whispering shall purchase from Shareholders on the
Closing Date (to be defined hereinafter) all of the Company Shares, consisting
of 50,000 bearer shares, nominal value US$ 1 (ONE AMERICAN DOLLAR) each share,
all represented by 24 titles of 2,000 bearer shares and 4 titles of 500 bearer
shares. The Shareholders shall, on the Closing Date, effect an assignment, free
and clear of any and all liens, restrictions and encumbrances, of all the
Shares, by subscribing certificates evidencing the ownership of such Company
Shares and by executing standard stock power forms, or such other documents as
are necessary to transfer title to the Company Shares to Whispering free and
clear of all liens and encumbrances. Whispering shall simultaneously issue the
Whispering Shares to Shareholders as provided herein.
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2. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER AND COMPANY. The Shareholders
and Company represent, warrant, and covenant to Whispering that:
a. Organization and Authority. The Company is a corporation duly organized,
validly existing and in good standing under the laws of Uruguay and has all
requisite corporate power and authority to own and lease its properties, to
carry on its business and to carry out the transactions contemplated hereby. The
business as conducted by the Company is not such as to require that it be
qualified to transact business as a foreign corporation in any other
jurisdiction.
b. Ownership of Shares. The authorized capital of the Company is US$ 1,000,000
(one million dollars), of which US$ 50,000 (fifty thousand dollars) have been
paid in and is represented by 50,000 bearer shares of common stock, of nominal
value US$ 1 (one American Dollar) per share. The Company Shares constitute the
sole issued and outstanding shares of capital stock of the Company, and are
validly issued, fully paid, nonassessable and subject to no liens, encumbrances,
options, or restrictions of any kind upon the Company Shares or upon the
Shareholders' ability to sell the Company Shares to Whispering. As of the
Closing Date, there will be no outstanding warrants, options, agreements,
convertible securities or other commitments pursuant to which the Company is or
may become obligated to issue any shares of its capital stock or other
securities. The record and beneficial ownership of the Company's Shares is set
forth in Exhibit 2(b) hereto.
c. Financial Statements. The financial statements of the Company furnished to
Whispering, as set forth in Exhibit 2(c) hereto and as initialed by the
Shareholders have been prepared in accordance with generally accepted accounting
principles consistently applied and consistent with prior practice, and present
the Company's financial position as of, and results of operations for, the dates
and periods indicated thereon.
d. Changes Since Incorporation. There have not been any changes since
incorporation in the financial condition, results of operations or otherwise of
the Company, which changes have, individually or in the aggregate, materially
adversely affected the business, property or financial position of the Company.
The stockholders' equity in the Company has not decreased from the above date.
e. Restrictive Agreements. The Company is not obligated under any contract or
agreement or subject to any charter or by-law restriction which materially and
adversely affects its business (as presently conducted), properties or assets or
its financial condition, and is not in default under any indenture or material
contract or agreement to which it is a party.
f. Ownership of Properties. The Company owns free and clear all the properties
and assets reflected in the Company's balance sheet as at January 31, 2001,
subject to no mortgages, liens, security interest, pledges, charges or other
encumbrances of any kind.
g. Patents and Trademarks. The Company has full title and ownership of all
copyrights, patents, trademarks, trade names, service marks, trade secrets,
conditional and proprietary information, formulas, designs, proprietary rights,
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know-how and processes, patent applications, licenses (United States or
foreign), with the exception of Canada (that has all of the rights for
diagnostic and thereapeutic use of the receptor of the AFP (RECAF) including any
subsequent claims or new patent applications involving the use of RECAF),
necessary to conduct its business as presently conducted and as proposed to be
conducted by Whispering (all of the foregoing collectively hereinafter referred
to as the "Proprietary Assets" and are set forth on Exhibit 2(g)). No royalties
are payable by the Company to any other persons by reason of the ownership or
use of the Proprietary Assets. The Company has not received notice that any
Proprietary Assets conflict with the asserted rights of any other. The Company
has no franchises and no franchises are required for the conduct of its
business.
h. Litigation. There is no action, suit, material customer claim, proceeding or
any investigation at law or in equity or by or before any governmental
instrumentality or other agency now pending, or threatened against or affecting
the Company or any property, assets or rights of the Company, nor do the
Shareholders, or any of them, know of any facts likely to give rise to any such
actions or proceedings. The Company is not in default with respect to any order,
writ, injunction or decree of any court or any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign.
i. Taxes. The Company has timely filed all tax returns of every kind which are
required to be filed by it, and all such returns are correct and complete. The
Company is not required to file any other income, excise or property or other
tax returns. The Company has paid or accrued all taxes pursuant to such returns
or pursuant to any assessments received by it or which it is obligated to
withhold from amounts owing to any employee, creditor or third party. The
provisions for taxes on the balance sheet at 31 January, 2001 are sufficient for
the payment of all accrued and unpaid taxes of the Company. The Company has not
waived any statute of limitations with respect to taxes and has not agreed to
any extension of time with respect to a tax assessment or deficiency. Copies of
all tax returns filed by the Company with respect to its last three years
through the 1999 fiscal year are attached hereto as Exhibit 2(i).
j. Material Contract. The Company is not a party to any material written or oral
contract not made in the ordinary course of business and is not a party to any
written or oral (1) distributor, dealer, manufacturer's representative, sales
agency or advertising contract which is not terminable on 30 days' (or less)
notice without cost or other liability to it; (2) contract with any labor union;
(3) contract for the future purchase of fixed assets or for the future purchase
of materials, supplies or equipment in excess of its normal operating
requirements; (4) contract for the employment of any officer, individual
employee or other person on a full-time or consulting basis; (5) bonus, pension,
profit-sharing, retirement, stock purchase, stock option, hospitalization,
medical insurance or similar plan, contract or understanding in effect with
respect to its employees or any of them or the employees of others; (6)
agreement or indenture relating to the borrowing of money or to the mortgaging,
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pledging or otherwise placing a lien on any of its assets; (7) guaranty of any
obligation for borrowed money or otherwise, excluding endorsement made for
collection; (8) lease or agreement under which it is lessor of or permits any
third party to hold or operate any property, real or personal, owned or
controlled by it, with the exception of the Canadian technology transfer
agreement, dated April 22, 1999; or (9) contract, agreement or commitment which
extends for more than six months after the date hereof or (10) contract of a
material nature.
k. Compliance with Laws and Regulations. The Company has complied with all laws,
regulations and orders applicable to its business and has all necessary permits
and licenses required thereby.
l. Events Since Incorporation. Since incorporation the Company has not (1)
borrowed any amount or incurred or become subject to any liabilities or
obligations of any nature whatsoever (contingent or otherwise) except current
liabilities and obligations incurred and liabilities and obligations under
contracts entered into in the ordinary course of business; (2) discharged or
satisfied any lien or encumbrance or paid any liability or obligation
(contingent or otherwise), other than current liabilities and obligations shown
on its balance sheet as at January 31, 2001, or current liabilities and
obligations incurred since that date in the ordinary course of business; (3)
declared or made any payment or distribution Of any monies or other property to
stockholders or purchased or redeemed, directly or indirectly, any shares of its
capital stock; (4) mortgaged, pledged or subjected to lien, charge or any
encumbrance, any of its assets, tangible or intangible; (5) sold. assigned, or
transferred any of its tangible assets, except in the ordinary course of
business, or cancelled any debts or claims; (6) sold, assigned or transferred
any patents, trademarks, trade names, copyrights, trade secrets or other
intangible assets, with the exception of the Canadian technology transfer
agreement, dated April 22, 1999; (7) suffered any extraordinary damage,
destruction, or loss (whether or not covered by insurance), whether or not in
the ordinary course of business, and, except in the ordinary course of business,
waived any rights of substantial value or cancelled any debt or claim held; (8)
made any loan to any employee or stockholder; or (9) entered into any
transaction other than in the ordinary course of business.
m. Books and Records. The books and records of the Company are in good and
current condition and provide sufficient information and documentation to
reflect and evidence the accounts receivable, accounts payable, ownership of all
assets and payment of all liabilities of the Company. Such books and records are
at the offices of the Company and shall be available to Whispering upon request
at mutually convenient times.
n. Governing Documents. The copies of the Articles of Incorporation and Bylaws
of the Company, and other constituting documents, set forth in their entirety in
Exhibit 2(o) hereto are correct and complete as of the date hereof.
o. Subsidiaries. The Company does not have any subsidiaries. For the purpose
hereof, the term "subsidiaries" shall mean any corporation, association or
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other business entity of which a majority of the voting stock, capital stock or
total outstanding equity interest is owned or controlled by the Company.
p. Undisclosed Liabilities. As of the date hereof, the Company does not have any
material liability (whether accrued, absolute, contingent, or otherwise, and
whether due or to become due) which is not shown and provided for in full on the
financial statements described in Exhibit 2(c) hereto.
q. Disclosure. None of the information contained in the representations and
warranties set forth in this Agreement or in any of the exhibits, certificates,
schedules or other instruments delivered or to be delivered to Whispering
pursuant to this Agreement contains or will contain any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading.
r. No Breach. The consummation of the transactions set forth in this Agreement
will not result in any breach of any of the terms, provisions, or conditions of,
or constitute a default under, or result in the creation of any lien, charge or
encumbrance on any property or assets of the Company pursuant to its respective
Articles of Organization Bylaws or other constituting documents, or any
indenture, agreement or instrument to which the Company is a party.
3. ACCESS TO BOOKS AND RECORDS. From and after the date hereof, Shareholders and
Company agree that the Company shall afford to Whispering, and accredited
representatives of Whispering, full an free access to its personnel, properties,
records and books of account, at all reasonable times during business hours, and
shall furnish to Whispering and its representatives such other information as
Whispering may reasonably request. The Company shall also authorize its
independent accountants to permit Whispering's independent public accountants to
examine records and working papers pertaining to the Company's financial
statements.
4. CONSIDERATION FOR SALE. Upon the terms and subject to all of the conditions
herein and upon the performance by each of the parties hereto of their
obligations hereunder, Shareholders shall convey, transfer, assign, deliver to
Whispering on Closing Date all of the Company Shares, and Whispering agrees to
issue to Shareholders, in the percentages set forth on Exhibit 4 attached
hereto. At the Closing, Shareholders shall deliver 24 titles for 2,000 each and
4 titles for 500 shares representing fifty thousand (50,000) bearer shares of
the Company, numbered 1 to 50,000 of nominal value US$ 1 (one American Dollar)
each share, to Whispering and Whispering shall issue the Whispering Shares and
deliver them to the Shareholders in equal proportions.
5. REPRESENTATIONS AND WARRANTIES OF WHISPERING. Whispering represents,
warrants, and covenants to Shareholders that:
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a. Organization and Authority. Whispering is a corporation duly organized,
validly existing and in good standing under the laws of the State of Texas and
has power and authority to own its properties and carry on its business now
being conducted. True copies of the Certificate of Incorporation and the Bylaws
of Whispering have been delivered to the Shareholders.
b. Capital Stock. All capital stock of Whispering issued and presently
outstanding has been validly issued and is fully paid and non-assessable. Except
as set forth on Exhibit 5(b), there are no outstanding options, warrants, or
rights of any sort which would entitle the holder thereof to acquire shares of
the capital stock of Whispering.
c. Financial Statements. The financial statements of the Whispering furnished to
Shareholders, as set forth in Exhibit 5(c) hereto have been prepared in
accordance with generally accepted accounting principles consistently applied
and consistent with prior practice, and present Whispering's financial position
as of, and results of operations for, the dates and periods indicated thereon.
d. Changes Since December 31, 2000. Except as set forth in exhibit 5(d) attached
hereto, there have not been any changes since December 31, 2000 in the financial
condition, results of operations or otherwise of Whispering, which changes have,
individually or in the aggregate, materially adversely affected the business,
property or financial position of Whispering.
e. Restrictive Agreements. Except as set forth in Exhibit 5(e) hereto,
Whispering is not obligated under any contract or agreement or subject to any
charter or by-law restriction which materially and adversely affects its
business (as presently conducted), properties or assets or its financial
condition, and is not in default under any indenture or material contract or
agreement to which it is a party.
f. Ownership of Properties. Except as set forth in Exhibit 5(f) hereto,
Whispering owns free and clear all the properties and assets reflected in
Whispering's balance sheets as at December 31, 2000 (other than assets disposed
of in the ordinary course of business since December 31, 2000) subject to no
mortgages, liens, security interest, pledges, charges or other encumbrances of
any kind.
g. Litigation. Except as set forth in Exhibit 5(g) hereto, there is no action,
suit, material customer claim, proceeding or, any investigation at law or in
equity or by or before any governmental instrumentality or other agency now
pending, or threatened against or affecting Whispering or any property, assets
or rights of Whispering, nor does Whispering know of any facts likely to give
rise to any such actions or proceedings. Exhibit 5(g) contains a statement of
the status as of the date hereof and the parameters of anticipated liability of
any of the matters referred to therein. Whispering is not in default with
respect to any order writ, injunction or decree of any court or any federal,
state, municipal or other governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign.
h. Taxes. Whispering has timely filed all tax returns of every kind which are
required to be filed by it, and all such returns are correct and complete
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Whispering is not required to file any other income, excise or property or other
tax returns. Whispering has paid or accrued all taxes pursuant to such returns
or pursuant to any assessments received by it or which it is obligated to
withhold from amounts owing to any employee, creditor or third party. The
provisions for taxes on the balance sheet at December 31, 2000 are sufficient
for the payment of all accrued and unpaid taxes of Whispering. Whispering has
not waived any statute of limitations with respect to taxes and has not agreed
to any extension of time with respect to a tax assessment or deficiency. Copies
of all tax returns filed by Whispering with respect to its last three years
through the 2000 fiscal year is attached hereto as exhibits.
i. Material Contract. Except as set forth in Exhibit 5(i) hereto, Whispering is
not a party or any material written or oral contract not made in the ordinary
course of business and is not a party to any written or oral (1) distributor,
dealer, manufacturer's representative, sales agency or advertising contract
which is not terminable on 30 days' (or less) notice without cost or other
liability to it; (2) contract with any labor union; (3) contract for the future
purchase of fixed assets or for the future purchase of materials, supplies or
equipment in excess of its normal operating requirements; (4) contract for the
employment of any officer, individual employee or other person on a full-time or
consulting basis; (5) bonus, pension, profit-sharing, retirement, stock
purchase, stock option, hospitalization, medical insurance or similar plan,
contract or understanding in effect with respect to its employees or any of them
or the employees of others; (6) agreement or indenture relating to the borrowing
of money or to the mortgaging, pledging or otherwise placing a lien on any of
its assets; (7) guaranty of any obligation for borrowed money or otherwise,
excluding endorsement made for collection; (8) lease or agreement under which it
is lessor of or permits any third party to hold or operate any property, real or
personal, owned or controlled by it; or (9) contract, agreement or commitment
which extends for more than six months after the date hereof or (10) contract of
a material nature.
j. Compliance with Laws end Regulations. Whispering has complied with all laws,
regulations and orders applicable to its business and has all necessary permits
and licenses required thereby.
k. Events Since December 31, 2000. Except as set forth in Exhibit 5(i) hereto,
since December 31, 2000, Whispering has not (1) borrowed any amount or incurred
or become subject to any liabilities or obligations of any nature whatsoever
(contingent or otherwise) except current liabilities and obligations incurred
and liabilities and obligations under contracts entered into in the ordinary
course of business; (2) discharged or satisfied any lien or encumbrance or paid
any liability or obligation (contingent or otherwise), other than current
liabilities and obligations shown on its balance sheet as at December 31, 2000,
or current liabilities end obligations incurred since that date in the ordinary
course of business; (3) declared or made any payment or distribution of any
monies or other property to stockholders or purchased or redeemed, directly or
indirectly, any shares of its capital stock; (4) mortgaged, pledged or subjected
to lien, charge or any encumbrance, any of its assets, tangible or intangible;
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(5) sold, assigned, or transferred any of its tangible assets, except in the
ordinary course of business, or cancelled any debts or claims; (6) sold,
assigned or transferred any patents, trademarks, trade names, copyrights, trade
secrets or other intangible assets; (7) suffered any extraordinary damage,
destruction, or loss (whether or not covered by insurance), whether or not in
the ordinary course of business, and, except in the ordinary course of business,
waived any rights of substantial value or cancelled any debt or claim held; (8)
made any loan to any employee or stockholder; or (9) entered into any
transaction other than in the ordinary course of business.
l. Governing Documents. The copies of the Articles of Organization and Bylaws of
Whispering set forth in their entirety in Exhibit 5(i) hereto are correct and
complete as of the date hereof.
m. Subsidiaries. Whispering does not have any subsidiaries. For the purpose
hereof, the term "subsidiaries" shell mean any corporation, association or other
business entity of which a majority of the voting stock, capital stock or total
outstanding equity interest is owned or controlled by the Company.
n. Undisclosed Liabilities. As of the date hereof the Company does not have any
material liability (whether accrued, absolute, contingent, or otherwise, and
whether due or to become due) which is not shown and provided for in full on the
financial statements described in Exhibit 5(c) hereto.
o. Disclosure. None of the information contained in the representations and
warranties set forth in this Agreement or in any of the exhibits, certificates,
schedules or other instruments delivered or to be delivered to Whispering
pursuant to this Agreement contains or will contain any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading.
6. COVENANTS OF SHAREHOLDERS AND COMPANY.
a. Shareholders and Company covenants that, from and after the date hereof and
through the Closing Date, without the prior written consent of Whispering, the
Company will not:
(i) declare or pay any dividend, or make any distribution of its properties or
assets to its stockholders, or allow the issuance of any of its stock or
purchase or otherwise acquire any shares of its outstanding stock (except as
otherwise expressly permitted by the terms of this Agreement);
(ii) make any change in its Articles of Incorporation and Bylaws or other
constituting documents except as provided herein;
(iii) grant stock options or rights of any kind to purchase shares of its stock;
(iv) increase the rate or form of compensation payable to any agent or employee
except salary adjustments in the ordinary course of business for employees who
are not officers or stockholders or related to officers or stockholders;
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(v) dispose of any items of inventory, properties or other assets except in
the ordinary course of business;
(vi) incur any indebtedness except in the ordinary course at business, nor
allow any material adverse change to be made in its financial affairs, nor allow
any tax or other liability to be extended by waiver of the statutes of
limitation or otherwise;
(vii) make or allow to be made any loans or advances or repayments of loans or
advances to any stockholders, director, officer or other employee.
b. Shareholders and Company covenant that from and after the date hereof and
through the Closing Date, the Company will:
(i) perform in the normal course of business all of its obligations under
contracts, leases, and documents relating to or affecting Its assets, properties
and business; business organization, sales agencies and distributorship and good
will, to the end that Whispering shall acquire from Shareholders a business as
now constituted, and to the end that said business shall, at the time of
Closing, have available to it for such time as it may reasonably require, the
services and assistance of present employees.
7. COSTS AND EXPENSES.
a. Shareholders shall pay all costs and expenses incurred or to be incurred by
Shareholders and the Company in carrying out this Agreement including, without
limitation, the expenses of the negotiation, preparation, execution and
consummation of this Agreement, the conveyance, transfer, assignment and
delivery of the Company Shares to Whispering and all legal and accounting fees
and expenses relating to any of the foregoing. Shareholders shall Indemnify and
hold the Company and Whispering free and harmless from and against any liability
for any of such expenses and fees.
b. Whispering shall pay all costs and expenses incurred or to be incurred by it
in carrying out this Agreement, including, without limitation, the expenses of
the negotiation, preparation, execution and consummation of this Agreement and
documents incidental hereto and all fees and expenses of his attorneys and
accountants incurred by it in connection with the foregoing. Whispering shall
indemnify and hold Shareholders free and harmless from and against any liability
for any of such expenses and fees.
8. CLOSING.
a. The Closing of the purchase and sale of the Company Shares (the "Closing"),
shall be effected at such time on or before the close of business on the first
business day following the execution of this Agreement as shall be designated by
Whispering through three (3) days prior written notice to the Shareholders (such
date or a subsequent date as of which the Closing shall be effected as
hereinafter provided herein called the "Closing Date").
b. AT THE CLOSING.
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(i) Shareholders shall execute and deliver to Whispering an assignment of the
Company Shares in such form as will convey to Whispering good and marketable
right, title and interest in and to the Company Shares, which shall be
simultaneously transferred to Whispering; and
(ii) Whispering shall deliver to Shareholders the Whispering Shares, free and
clear of all liens and encumbrances.
c. Possession and control of the Company is to be secured to Whispering pursuant
to this Agreement on the Closing Date. Shareholders will, from time to time, on
and after the Closing Date, upon the request of the Whispering, do, execute,
acknowledge, and deliver all such acts, documents, instruments, and assurances
as may be reasonably required to insure and protect Whispering's right, title
and interest in and to all of the assets and properties of the Company.
9. CONDITIONS PRECEDENT TO OBLIGATIONS OF WHISPERING. The obligations of
Whispering to consummate this Agreement and the transactions set forth herein
shall be subject to and shall be conditioned upon each of the following
conditions precedent.
a. No properties or assets of the Company shall have suffered any destruction or
damage by fire, accident or other casualty, Act of God, taking by eminent domain
or force majeure materially affecting the conduct of the business of the
Company.
b. The representations and warranties made by Shareholders and Company in
Section 2 hereof shall be true and correct in all material respects on and as of
the Closing Date with the same force and effect as though such representations
had been made on and as of the Closing Date, none of the Covenants of the
Shareholders or Company contained herein shall have been breached in any
material respect as of the Closing Date.
c. There has been no material adverse change in the condition, financial or
otherwise, of the Company from that set forth in its financial statements as of
January 31, 2001.
d. No consent, approval, authorization or order of any person or any court or
governmental agency or administrative body not obtained and in effect on the
Closing Date shall be required for the consummation of the transaction
contemplated by this Agreement.
10. CONDITIONS PRECEDENT TO OBLIGATIONS OF SHAREHOLDERS. The obligations of
Shareholders to consummate this Agreement and to deliver 24 titles of 2,000
shares each and 4 titles of 500 shares each representing 50,000 bearer Shares,
numbered 1 to 50,000, of the Company shall be subject to and shall be
conditioned upon each of the following conditions precedent:
a. All proceedings required to be taken by Whispering to authorize it to carry
out this Agreement and to pay for the Company Shares pursuant to this Agreement
have been duly validly taken.
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b. All of the terms, covenants and conditions of this Agreement to be complied
with and performed by Whispering on or before the Closing Date shall have been
complied with and performed.
c. The representations and warranties made by Whispering in Section 5 hereof
shell be true and correct in all material respects on and as of the Closing Date
with the same force and effect as though such representations had been made on
and as of the Closing Date, none of the Covenants of Whispering contained herein
shall have been breached in any material respect as of the Closing Date.
d. No consent, approval, authorization, or order of any court or governmental
agency or administrative body not obtained in effect on the Closing Date shall
be required for the consummation of the transactions contemplated by this
Agreement and no claim, proceeding or litigation, either administrative or
judicial shall be threatened or be pending against Whispering which, in the
opinion of counsel for Shareholders, presents a reasonable probability that the
transactions contemplated by this Agreement may be enjoined or prevented.
11. SHAREHOLDERS' INDEMNIFICATION. Shareholders jointly and severally hereby
agree to indemnify, and hold harmless, Whispering on demand against any and all
liability, loss, damage, and expense arising out of, in connection with, or as a
result of any breach of this Agreement by Shareholders or any failure of a
representation or warranty of Shareholders or the Company contained in this
Agreement to be correct and complete or any failure of a covenant to be carried
out. For the purposes hereof, without limiting the right of Whispering to be
indemnified hereby, if any untrue or incomplete representation or warranty
contained herein relates to the amount of assets or liabilities of the Company,
the amounts by which the assets are lower and liabilities are greater than those
referred to in the representation or warranty shall constitute an indemnifiable
loss hereunder. Whispering's right to be indemnified and held harmless shall
include the right to be reimbursed for legal and accounting expenses and fees
incurred by Whispering in connection herewith in identifying or defending
against any claim.
12. WHISPERING INDEMNIFICATION. Whispering hereby agrees to indemnify, and hold
harmless, Shareholders on demand against any and all liability, loss, damage,
and expense arising out of, in connection with, or as a result of any breach of
this Agreement by Whispering or any failure of a representation or warranty by
Whispering contained in this Agreement to be correct and complete or any failure
of a covenant to be carried out. For the purposes hereof, without limiting the
right of Shareholders to be indemnified hereby, if any untrue or incomplete
representation or warranty contained herein relates to the amount of assets or
liabilities of Whispering, the amounts by which the assets are lower and
liabilities are greater than those referred to in the representation or warranty
shall constitute an indemnifiable loss hereunder. Shareholders' rights to be
indemnified and held harmless shall include the right to be reimbursed for legal
and accounting expenses and fees incurred by Shareholder in connection herewith
in identifying or defending against any claim.
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13. LITIGATION.
a. In any litigation involving this Agreement or the rights thereunder, the
successful party shall be entitled to reasonable costs and attorneys' fees as
prescribed by the Court.
b. Before being required to make any payment pursuant to Sections 11 and 12, the
indemnifying party may, in its discretion and expense, take all necessary steps
properly to contest any claim or liability or action in respect thereof
involving third parties, or to prosecute such contest or action to conclusion or
settlement satisfactory to the indemnified party. The indemnified party shall
give notice of any claim to indemnification it may wish to assert pursuant
hereto as soon as reasonably practicable. The indemnified party shall cooperate
fully with the indemnifying party in the reasonable conduct of any such contest
or action, legal proceedings, negotiation or settlement and will not voluntarily
compromise or settle any such contest, action, legal proceeding, claim or demand
without prior consent or approval of the indemnifying party.
c. The right of Whispering or the Company as the case may be, to recover
hereunder shall not be affected by any investigation by Whispering prior to the
Closing Date.
14. INVESTMENT LETTER.
ATTACHED HERETO AS EXHIBIT A, AND IS INCORPORATED IN THIS AGREEMENT BY
REFERENCE.
15. MISCELLANEOUS.
a. Acknowledgement of Preamble. The parties acknowledge that the Preamble sets
forth their understandings and it is hereby incorporated into this Agreement.
b. Survival of Representations and Warranties. The representations, warranties
and covenants contained herein shall survive the execution hereof and the
consummation of this transaction.
c. Notices. Any notices hereunder shall be given in writing by certified mail,
return receipt requested, if to Whispering, to the offices of the Company,
Attention: President, and if to the Shareholders, to the address set forth
hereinabove.
d. Modification. This Agreement and the rights and duties hereunder may not be
modified, revised or terminated except by a writing signed by all parties hereto
or their duly authorized representatives.
E. Binding Effect. All of the terms, conditions, representations, warranties and
covenants contained in this Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors and assigns. No
waiver by any party of any condition or of the breach of any term,
representation, warranty or covenant contained in this Agreement in any one
instance shall be deemed to be or construed as a further or continuing waiver.
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The Shareholders, and each of them, hereby represent warrant and covenant that
they are not now under any obligation of a contractual nature or otherwise, to
any person, firm, or corporation which is inconsistent or in conflict with this
Agreement, or which would prevent, limit or impair in any way the performance of
any obligation hereunder.
f. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original and all of which together shall
constitute one and the same Agreement of the parties hereto.
g. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Texas.
IN WITNESS WHEREOF, the parties hereto have hereunder set their hands as of the
day and year first above written.
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By "Whispering" WHISPERING OAKS INTERNATIONAL, INC.
--------------------------------------
By the "Company" LACOSTAR TRADING S.A.
The "Shareholders"
/s/ Xxxx Xxxxx Xxxx /s/ Xxxxxxx Xxxxxx Xxxx
--------------------------------- ---------------------------------
Xxxx Xxxxx Xxxx Xxxxxxx Xxxxxx Xxxx
/s/ Xxxxxx Xxxx /s/ Xxxxx Xxxxxx Xxxx
--------------------------------- ---------------------------------
Xxxxxx Xxxx Xxxxx Xxxxxx Xxxx
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