American Motorcycle Company
00 Xxxxxxx Xxxxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
August 15, 2000
DELIVERED
Xx. Xxxxxxx X. Xxxxx
Chairman and Chief Executive Officer
American Quantum Cycles, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
X.X.X. 00000
Dear Xx. Xxxxx:
Re: Binding Merger Agreement of American Motorcycle Company into
a wholly-owned subsidiary of American Quantum Cycles, Inc.
This letter will serve as a formal contract for the merger between a
wholly-owned subsidiary (the "Subsidiary") of American Quantum Cycles, Inc. (the
"Purchaser") and American Motorcycle Company (the "Company") by agreement of all
the shareholders of the Company (the "Vendors"), the Purchaser and the Company,
to be effective on the date hereof (the "Closing Date") by execution by all
parties to this letter agreement and receipt by Mr. Xxxxxx Xxxxx of 500,000
preferred shares of the Purchaser, having the attributes attached hereto as
Schedule "A" (the "Preferred Stock"). Each Preferred Stock will have 38.39 votes
and be convertible into 38.39 common shares of the Purchaser.
The Preferred Stock is received on the basis that in all cases the 500,000
Preferred Stock will be convertible into 50% of the aggregate issued and
outstanding common shares of the Purchaser on a fully diluted basis, subject
only to Section 2 herein. In addition, the Preferred Stock prior to conversion
will, in all cases, have at least 50% of the aggregate votes attributable to the
preferred stock and the common shares of the Purchaser, with an anti-dilution
provision in effect until such time as all necessary shareholder and regulatory
approvals have been obtained to increase the authorized capital to, among other
things, permit the conversion of the Preferred Stock into common shares as
contemplated herein. Such anti-dilution provision shall have the effect of
ensuring that the Preferred Stock shall maintain at least 50% of the aggregate
votes attributable to all of the preferred stock and common shares issued and
outstanding or to be issued and outstanding until such time as the said
approvals have been obtained. It is intended that these provisions will apply
until such time as the merger of the Subsidiary and the Company has been
completed and all necessary shareholder and regulatory approvals have been
obtained to increase the authorized capital to, among other things, permit the
conversion of the Preferred Stock into common shares as contemplated pursuant to
the terms of this letter.
However, in order to continue to have the Purchaser's common stock listed on the
American Stock Exchange, it is a condition of the American Stock Exchange that,
until the shareholders of the Purchaser have approved the issuance of the
Preferred Stock, the Vendors may not collectively vote in excess of 19.99% of
the Preferred Stock in any matter submitted to the shareholders of the
Purchaser.
It is intended by the parties hereto that this letter is a legal and binding
agreement.
1. Purchase. The Purchaser hereby agrees to acquire from the Vendors and
the Vendors hereby agree to sell to the Purchaser 100% of the issued
and outstanding shares in the capital stock of the Company (the
"Purchased Shares") for the 500,000 Preferred Stock of the Purchaser
(the "Purchase Price"). The Purchase Price, subject to the Adjustments
(as defined in Section 2 below), shall be paid to the Vendors through
the payment at the Closing Date to each Vendor of the following
Preferred Stock set out beside such Vendor's name:
Name Number of Preferred Stock
---- -------------------------
Merchant Banking Services Inc. 200,000
Xxxxxx X. Xxxxx 42,500
Praxis International Inc. 15,000
Xxxx and Xxxxxxxxx Xxxxxxx Xxxxx 5,000
Xxxx X. Xxxxxx 15,000
Xxxxxx Xxxxxxxxxxxx 5,000
Life Success Ventures Inc. 2,500
Transam Holdings Inc. 15,000
Xxxxxx and Xxxxxx Xxxxxxx 75,000
Xxxxxxx X. and Xxxxxx X. Xxxxx, JT 75,000
Xxx Xxxxxxx 5,000
Xxxxxx Xxxxxx 2,500
Xxxxxx Xxxxx, in trust 42,500
all of which shall be issued at the Closing Date as fully paid
and non-assessable Preferred Stock of the Purchaser on the
Closing Date and delivered to Xxxxxx Xxxxx, as representative
of the Vendors and the Company.
2. Adjustments to the Purchase Price. To allow for a complete due
diligence review of the Company and of the Purchaser, and the
respective financial positions as represented in Section 7, adjustments
will be made to the Purchase Price within six (6) months of the Closing
Date as follows:
2
(1) The Purchaser has represented and warranted its value in terms
of assets, liabilities, contracts and obligations according to
such information attached hereto on Exhibit 1 (the "Purchaser
Value"), and its capital structure according to the capital
structure of the Purchaser attached hereto on Exhibit 1 (the
"Purchaser Capital"). In the event that the Purchaser Value is
determined to be adversely incorrect for an amount (the
"Purchaser Amount") of at least $100,000.00, in the aggregate,
then additional Preferred Stock equal to the Purchaser Amount
will be issued to the Vendors. For these purposes, the
Preferred Stock will be issued at the rate of $42.16 per share
of Preferred Stock, with the same provisions as the Preferred
Stock issued for the Purchase Price. In the event the number
of outstanding shares of the Purchaser is higher than
disclosed as the Purchaser Capital, the number of Preferred
Stock issued to the Vendors will be increased on a 1 for 1
basis, with the same provisions as the Preferred Stock issued
for the Purchase Price; and
(2) The Company has represented and warranted its value and
structure according to the obligations and capital structure
of the Company attached hereto as Exhibit 2 (the "Company
Value"). In the event that the Company Value is determined to
be adversely incorrect for an amount (the "Company Amount") of
at least $100,000.00, in the aggregate, then the Preferred
Stock equal to the Company Amount will be returned to the
treasury of the Purchaser for cancellation. For these
purposes, the Preferred Stock will be cancelled at the rate of
$42.16 per share of Preferred Stock.
3. Merger. The parties acknowledge that the 500,000 Preferred Stock are to
be delivered to the custody of Mr. Xxxxxx Xxxxx on Closing, on behalf
of the shareholders of the Company in exchange for all of the stock of
the Company, following which, on Closing, the Company shall be merged
into the Subsidiary of the Purchaser in a transaction intended to
qualify as a tax-free reorganization to the shareholders of the Company
under Section 368 of the Internal Revenue Code of 1986 as amended. The
resulting merged company will be named "American Motorcycle Company",
and will own all of the assets of the Company as described below. For
the purposes of this letter agreement, the post-merger American
Motorcycle Company will be referred to as the "Merged Company".
4. Business Plan. The Purchaser and Vendors each acknowledge that a number
of operational and procedural issues will be mutually agreed to and
will form the basis of a business plan (the "Business Plan") for the
Purchaser and the Merged Company. The essence of the Business Plan is
for the Purchaser and the Merged Company to acquire companies currently
involved in the worldwide motorcycle industry. These target companies
have various holdings in the areas of trademarks, engines, motorcycle
sales and some combinations thereof. The Business Plan shall be
designed to capitalize on the Company's unique expertise in corporate
management, corporate finance and trademarks to form a strategic
alliance available only by the inclusion of the Company in the
Purchaser's family of companies. It is intended initially, until
shareholder approval is received to increase the authorized capital of
the Purchaser and subject to the anti-dilution provision attaching to
the Preferred Stock, to use the unissued preferred shares of the
Purchaser to facilitate such transactions, with conversion rates on a
1:1 basis into common shares or such other basis as agreed to by the
board of directors at that time.
3
5. Capital Restructuring of the Purchaser or Merged Company. The Purchaser
and the Company agree that the Purchaser will take all steps necessary
to obtain shareholder approval forthwith for an amendment of the
Purchaser's Articles of Incorporation to increase its authorized common
shares to permit conversion of the Preferred Stock, to allow conversion
of any other preferred shares of the Purchaser used to accommodate the
acquisitions contemplated in the Business Plan, and to permit exercise
of the options and warrants issued by the Purchaser. The board of
directors will use its best efforts to support the said amendment,
implementation of the Business Plan and all matters contemplated by
this letter agreement. The Purchaser shall cause an annual or special
meeting of the shareholders to deal with foregoing amendment and, to
the extent necessary or desirable, the implementation of the Business
Plan and matters contemplated by this letter agreement on or before
December 1, 2000.
6. Attorney. The Vendors collectively hereby irrevocably appoint Xxxxxx
Xxxxx as their proxy and authorized attorney to vote all of the Vendors
Preferred Stock at any meeting of the shareholders to approve any
matters whatsoever contemplated by or arising out of this Agreement
including, without limitation, this transaction, any changes to the
authorized or issued capital or shares and any transaction contemplated
by or arising out of the Business Plan, as same may be amended or
modified from time to time, and any financings related thereto. Each
Vendor agrees to provide such further documents or materials as are
required to implement the foregoing.
7. Representations and Warranties.
------------------------------
(1) The Purchaser represents and warrants to the Vendors as
follows, and acknowledges that the Vendors are relying upon
such representations and warranties in connection with
entering into this agreement and completing the transactions
contemplated thereby:
(1) Each of the Purchaser and the Subsidiary is a
corporation incorporated and subsisting under the
laws of Florida, has all legal capacity to own its
properties and conduct its business as presently
being conducted by it, and is duly registered or
otherwise qualified to carry on business in all
jurisdictions in which the nature of its assets or
business makes such registration or qualification
necessary or advisable.
(2) This agreement has been duly executed and delivered
by the Purchaser and constitutes, and the agreements
contemplated herein when executed will constitute,
valid and binding obligations of the Purchaser
enforceable against it in accordance with the terms
hereof and thereof.
(3) The entering into and performance of this agreement
and the agreements contemplated herein will not
violate, contravene, breach or offend against or
result in any default under any security agreement,
indenture, mortgage, lease, order, undertaking,
licence, permit, agreement, instrument, charter or
by-law provision, resolution of shareholders or
directors, statute, regulation, judgment, decree or
law to which either the Purchaser or the Subsidiary
is a party or by which it may be bound or affected.
No licenses, agreements or other instruments or
documents will terminate or require assignment as a
result of the entering into of this Agreement or the
consummation of the transactions contemplated hereby.
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(4) The authorized capital of the Purchaser is now, and
on the Closing Date will be, 12,500,000 common shares
and 2,500,000 preferred shares of which 19,194,031
common shares of the Company are presently
outstanding on a fully diluted basis, and on the
Closing Date 19,194,031 common shares on a fully
diluted basis and the 500,000 Preferred Stock will be
issued and outstanding. All of the Preferred Stock
have been validly authorized, allotted and issued and
are outstanding as fully-paid and non-assessable
preferred shares and on the Closing Date will be the
only issued and outstanding preferred shares of the
Purchaser. The aforementioned shares are or would be,
as the case may be, entitled to only 1 vote per
common share.
(5) The Purchaser's audited financial statements (the
"Financial Statements"), which are attached hereto as
a schedule and include a balance sheet, a statement
of income, retained earnings and source and
application of funds, and the notes thereto are true
and correct and have been prepared in accordance with
GAAP applied on a basis consistent with those of
preceding periods and present fairly on a
consolidated basis:
(1) all of the assets, liabilities (whether
accrued, determinable, absolute, contingent
or otherwise) and the financial condition of
the Purchaser as at the Purchaser's fiscal
2000 year end; and
(2) the sales, earnings and results of
operations of the Purchaser during the
period(s) covered by such financial
statements.
(6) There are no material liabilities of the Purchaser or
the Subsidiary of any kind whatsoever, whether or not
accrued and whether or not determined or
determinable, in respect of which the Purchaser or
the Merged Company may become liable on or after the
transaction contemplated by this Agreement other than
liabilities incurred in the ordinary course of
business and reflected in the Purchaser's Financial
Statements.
(7) The Purchaser has no subsidiaries and is not bound by
any agreements of any nature to acquire any
subsidiary, save and except for the Subsidiary which
was recently incorporated, has carried on no business
and has no assets or liabilities whatsoever.
(8) No options, warrants, convertible obligations or
other rights to purchase or otherwise acquire shares
or other securities of the Purchaser or the
Subsidiary are issued or outstanding, except as
disclosed in the Purchaser Value. The Purchaser shall
not issue or enter into any agreements to issue any
securities of the Purchaser other than the Preferred
Stock.
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(9) The Purchaser has not given or agreed to give, nor is
it a party to or bound by, any indemnity, or any
guarantee of indebtedness or other obligations of
third parties or any other commitment by which the
Purchaser or the Subsidiary is or is contingently
responsible for such indebtedness or other
obligations, except as disclosed in the Purchaser
Value.
(10) The Purchaser is duly registered as a public company
with the Securities and Exchange Commission (the
"SEC") and is in compliance in all material respects
with all regulations, policies and rules of the SEC
and all applicable securities laws of the United
States. The Purchaser is up to date on all filings
required by the SEC and applicable securities laws of
the United States in order to be a public company in
good standing. The issue of the Preferred Stock to
the Vendors under the terms of this letter agreement
is in compliance with all requirements of the SEC and
all policies and regulations related thereto. The
Preferred Stock is subject to American Stock Exchange
approval, but if such approval is not given, although
the Purchaser may be de-listed from the American
Stock Exchange, the Preferred Stock shall nonetheless
be validly authorized, allotted, issued, outstanding,
fully paid and non-assessable with all rights and
attributes previously described herein and on any
schedule attached. The issuance of the Preferred
Stock may be done without registration with the SEC,
pursuant to one ore more exemptions from registration
available pursuant to the Securities Act of 1933 or
regulations promulgated thereunder. Subject to
obtaining necessary shareholder and regulatory
approval to increase the authorized capital, the
Preferred Stock may be converted by the holders
thereof into shares of common stock of the Purchaser
without registration. In the event that the common
shares issuable on the conversion of the Preferred
Stock are not registered, then such common shares may
be resold provided they have been held for a period
of one (1) year, compliance with rule 144 procedures
are accomplished and all required filings and
opinions pursuant to the aforementioned exemptions
from registration, are completed and complied with as
required. Subject to obtaining necessary shareholder
and regulatory approval to increase the authorized
capital, upon the filing of an effective Registration
Statement qualifying the distribution of the common
shares issued to the Vendors on the conversion of the
Preferred Stock provided for in Section 11, there
will be no restrictions preventing the Vendors from
freely trading the common shares on the American
Stock Exchange or on such other exchange as the
shares of the Merged Company may be listed from time
to time.
(11) The Purchaser shall use its best efforts to ensure
that the merger shall qualify as a tax-free
re-organization.
(12) A quorum for directors' meetings shall not be less
than the minimum number of directors required by the
Florida Business Corporations Act and, on, from and
after Closing, until validly changed, one (1) of
which must be Xxxxxx Xxxxx or one (1) of his
nominees.
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(2) Each Vendor severally and the Company hereby represent and
warrant to the Purchaser as follows, and acknowledge that the
Purchaser is relying upon such representations and warranties
in connection with entering into this agreement and completing
the transactions contemplated thereby:
(1) The Company is a corporation incorporated and
subsisting under the laws of Delaware, has all legal
capacity to own its properties and conduct its
business as presently being conducted by it, and is
duly registered or otherwise qualified to carry on
business in all jurisdictions in which the nature of
its assets or business makes such registration or
qualification necessary or advisable.
(2) This agreement has been duly executed and delivered
by the Company and on behalf of such Vendor, and
constitutes, and the agreements contemplated herein
when executed will constitute, valid and binding
obligations of the Company and such Vendor
enforceable against each in accordance with the terms
hereof and thereof.
(3) The entering into and performance of this agreement
and the agreements contemplated herein will not
violate, contravene, breach or offend against or
result in any default under any security agreement,
indenture, mortgage, lease, order, undertaking,
licence, permit, agreement, instrument, charter or
by-law provision, resolution of shareholders or
directors, statute, regulation, judgment, decree or
law to which the Company or such Vendor is a party or
by which it may be bound or affected. No licenses,
agreements or other instruments or documents to which
the Company or such Vendor is a party will terminate
or require assignment as a result of the entering
into of this Agreement or the consummation of the
transactions contemplated hereby.
(4) The authorized capital of the Company is now, and on
the Closing Date will be, 1,000 common shares of
which only 1,000 common shares of the Company are
presently outstanding, and on the Closing Date 1,000
common shares will be issued and outstanding.
(5) The Company holds full title and interest in pending
trademark applications (the potential for success of
which is not represented or warranted) in the United
States with the United States Patent and Trademark
Office for the "American Motorcycle" and "American
Motorcycle Company" trademarks and designs, in the
form attached.
7
(6) Each of the Vendors is an "accredited" (as defined in
Regulation D of the SEC) or a sophisticated investor
with the ability to bear the risks of an investment
in the securities of the Purchaser; each Vendor is
acquiring the securities for investment, for his, her
or its own account without a view to the distribution
or resale thereof; and each Vendor has engaged
heretofore in transactions similar to that
contemplated herein and has such knowledge and
experience in financial and business matters that he,
she or it is capable of evaluating the merits and
risks of an investment in the securities. Each of the
Vendors has been provided through its representatives
with access to information pertaining to the
Purchaser in order to make an informed judgment with
regard to the investment merit of the Preferred Stock
being issued to each of them.
Although Xxxxxx Xxxxx is signing this Agreement on behalf of
all of the Vendors, he shall have no personal liability
whatsoever for any covenant, representation or warranty made
by any such Vendor herein (other than himself) and each
Vendor, by accepting its respective Preferred Stock on Closing
shall be conclusively deemed to have made its covenants,
representations and warranties herein severally on its own
behalf and with respect to only itself and the Corporation and
not any of the other Vendors.
8. Reliance. The Purchaser hereby expressly acknowledges that the Company
and the Vendors are relying upon the covenants, representations and
warranties of the Purchaser contained in this agreement and in any
agreement, certificate or other document delivered pursuant hereto in
connection with the completion of the transactions contemplated
hereunder. The Company and each Vendor hereby expressly acknowledge
that the Purchaser is relying upon the covenants, representations and
warranties of the Company and severally of each such Vendor contained
in this agreement and in any agreement, certificate or other document
delivered pursuant hereto in connection with the completion of the
transactions contemplated hereunder.
9. Survival. The covenants, representations and warranties of the parties
contained in this agreement and in any document or certificate given
pursuant hereto shall survive the Closing Date for a period of two (2)
years thereafter and, with respect to tax matters only, two (2) years
after the period during which assessments or re-assessments could be
issued.
10. Conditions to Closing. Notwithstanding any other provision of this
agreement, the completion of the transactions contemplated hereby is
subject to the following conditions which are inserted for the sole
benefit of the Vendors (any of which may be waived in writing at any
time prior to the Closing Date by Mr. Xxxxxx Xxxxx on behalf of all of
the Vendors):
(1) delivery of the 500,000 Preferred Stock to Mr. Xxxxxx
Xxxxx on Closing in accordance with the terms of this
agreement;
(2) approval by banks, lessors or similar creditors of
the Purchaser, if necessary;
(3) receipt of opinions of counsel to the Purchaser
concerning the representations and warranties of the
Purchaser contained herein relating to corporate,
share and securities matters; and
(4) all other such approvals as are required in order to
consummate the transactions contemplated by this
letter agreement.
8
11. Registration Rights. At any time and from time to time for a period of
two (2) years after the effective date of the conversion of the
Preferred Stock, the holders of 15% of the then outstanding shares of
common stock which were originally issued upon the conversion of the
Preferred Stock may request registration under the Securities Act of
1933 or all or part of their common stock, but in no case less than
100,000 of such shares. Within ten (10) business days after receipt of
any such request, the Purchaser will give written notice of such
requested registration to all other holders of the then unregistered
shares of common stock which were originally issued upon the conversion
of the Preferred Stock and will include in such registration all shares
of such common stock with respect to which the Purchaser has received
written request for inclusion therein within fifteen (15) business days
after receipt of the Purchaser's notice. The Purchaser will then use
reasonable efforts to effect as soon as practicable the registration
and sale of such shares, completely at its own expense, and the
Purchaser shall indemnify, to the extent permitted by law, each person
selling common stock pursuant to any registration statement, against
all losses, claims, damages, liabilities and expenses caused by any
failure to comply with the Securities Act or other applicable laws,
including any untrue or alleged untrue statement or material fact or
omission or alleged omission of a material fact required to be made or
necessary under the Securities Act or the Securities Exchange Act of
1934 other than a failure by the selling person. The holders of such
common stock are entitled to request an aggregate of three (3)
registrations on Form S-1 or any similar long form registration
statement and unlimited registrations on Form S-3 or any similar short
form registration statement; a registration on Form S-1 shall not be
deemed to have been requested if such registration shall not have
become effective.
12. Covenants. The parties hereto hereby agree to implement the following
covenants to each party, as applicable:
(1) on Closing, three (3) of the current six (6) directors shall
resign, such that the remaining three (3) current directors
shall be Xxxxxxx Xxxxx, Xxxxxxx Xxxxxxx and X.X. Xxxx. On
Closing, the following three (3) persons shall each be
appointed directors to replace the said resigning directors:
Xxxxxx Xxxxx, Xxxx Xxxxx and Xxx Xxxxxxx;
(2) the new board of directors of the Merged Company shall appoint
a Compensation Committee comprised of Messrs. Xxxxx and Xxxxx
and two (2) of the independent directors to determine
management compensation packages;
(3) the Purchaser or the Merged Company, as the case may be, shall
assume the master license agreement attached hereto as Exhibit
2;
(4) each party agrees not to enter into any transaction (or to
cause such a transaction to occur), that would significantly
and materially preclude the consummation of this letter
agreement, the merger forming the Merged Company, or any long
form agreement replacing this letter agreement; and
9
(5) each party hereto agrees that it will not issue any press
release or other disclosure concerning this letter agreement
or of the transaction to form the Merged Company without the
prior approval of the other, which shall not be unreasonably
withheld, unless, in the good faith opinion of counsel to such
party, such disclosure is required by law and time does not
permit the obtaining of such consent, or such consent is
withheld.
13. Expenses. Subject to paragraph 14, each party to this letter agreement
shall bear its own expenses relating thereto, except those expenses
incurred in the preparation of this letter agreement and the
confidential memorandum of information which shall be paid or be
reimbursed by the Purchaser following the merger forming the Merged
Company.
14. Payment. The Purchaser acknowledges and agrees that the Company and the
Vendors have already fully demonstrated to the Purchaser the expertise
of the principals of the Company in the motorcycle industry generally,
the recapitalization of motorcycle companies specifically, and with
respect to trademarks and other intellectual properties related
thereto. In the event that: (i) the Preferred Stock is or is deemed not
to be validly authorized, allotted, issued, outstanding, fully paid and
non-assessable with all rights and attributes previously described
herein and on any schedule attached for any reason whatsoever or the
shareholders do not approve of the transaction contemplated by this
Agreement for any reason whatsoever; or (ii) without limiting the
rights of the Vendors and the Company under subsection (i), the merger
transaction contemplated herein cannot be completed or the
shareholder's meeting described in Section 5 of this letter agreement
does not take place within the time frame stipulated for any reason
attributable to the conduct or lack of conduct of the Purchaser which
it has the capacity to prevent, or through its good faith efforts
should have the ability to satisfy, then the Vendors shall be relieved
of all obligations herein and the Purchaser agrees to pay to the
Vendors all fees, costs and expenses actually incurred by the Company
and Vendors in:
(1) the preparation of this letter agreement;
(2) in connection with its due diligence review of the Purchaser;
(3) in connection with the preparation of the confidential
memorandum of information;
(4) in the preparation of any long form agreement replacing this
letter agreement; and
(5) in connection with all other activities associated with this
transaction.
In addition, in such circumstances the Purchaser agrees:
(6) to pay $500,000 to the Vendors, to be divided pro-rata among
them in proportion to the shareholdings discussed previously
herein; and
(7) to validly issue and deliver all of the Preferred Stock to the
Vendors, being 500,000 shares of the said Preferred Stock with
the attributes described herein and on any schedules attached,
to be divided pro-rata among them in proportion to the
shareholdings discussed previously herein; and
10
(8) that Xxxxxx Xxxxx shall be irrevocably assigned the exclusive
right to acquire any of the companies or rights acquired or
contracts to be acquired pursuant to the Business Plan.
The aforementioned provisions of this Section 14 supercede the break-up fee
provision in Section 6 of the Confidentiality Agreement between the Purchaser
and the Company dated July 5, 2000.
15. Entire Agreement. This agreement, including any Schedules attached
hereto, together with the agreements and other documents to be
delivered pursuant hereto, constitute the entire agreement between the
parties pertaining to the subject matter hereof and supersede all prior
agreements, understandings, negotiations and discussions, whether oral
or written, of the parties and there are no warranties, representations
or other agreements between the parties in connection with the subject
matter hereof except as specifically set forth herein and therein. This
agreement may not be amended or modified in any respect except by
written instrument signed by all parties.
16. Time of the Essence. Time shall be of the essence of this agreement and
each and every part hereof.
17. Further Assurances. The parties hereto shall with reasonable diligence
do all such things and provide all such reasonable assurances as may be
required to consummate the transactions contemplated hereby, and each
party shall execute and deliver such other documents, instruments,
papers and information as may be reasonably requested by the other
party hereto in order to carry out the purpose and intent of this
agreement. The Purchaser agrees not to solicit, seek and provide
information to or respond favourably to any solicitation from, or
otherwise enter into any negotiations or reach any agreement with, any
person or entity regarding the sale, merger, consolidation or transfer
of any of the assets, stock or rights of the Purchaser.
18. Law and Jurisdiction. This agreement shall be governed by and construed
in accordance with the laws of the State of Florida and the laws of the
United States of America applicable therein. The parties hereby attorn
to the exclusive jurisdiction of the Courts of Brevard County in the
State of Florida in any dispute that may arise hereunder.
19. Enurement. This Agreement shall be binding upon and shall inure to the
benefit of and be enforceable by the heirs, administrators, executors,
estate, successors and permitted assigns of the parties hereto.
11
Please sign and date this letter agreement in the spaces provided below to
confirm our mutual agreement to the terms set out above and return a fully
signed copy to the undersigned along with the 500,000 Preferred Stock.
Yours truly,
AMERICAN MOTORCYCLE COMPANY
Per:
------------------------------
XXXXXX XXXXX, PRESIDENT
------------------------------
XXXXXX XXXXX, ON BEHALF OF
ALL THE VENDORS
ACKNOWLEDGED AND AGREED TO this day of August, 2000.
-------
AMERICAN QUANTUM CYCLES, INC.
Per:
-------------------------------
XXXXXXX X. XXXXX, PRESIDENT
EXHIBIT 2
Company Value
Assets- Pending trademark applications in the United States with the
United States Patent and Trademark Office for the "American
Motorcycle" and "American Motorcycle Company" trademarks and
designs.
Liabilities - Exclusive License with American Motorcycle Company Inc., a
copy of which is attached.
Capital Structure:
Name Number of Shares Class
---- ---------------- -----
Merchant Banking Services Inc. 400 Common
Xxxxxx X. Xxxxx 85 Common
Praxis International Inc. 30 Common
Xxxx and Xxxxxxxxx Xxxxxxx Xxxxx 10 Common
Xxxx X. Xxxxxx 30 Common
Xxxxxx and Xxxxxx Xxxxxxx 150 Common
Xxxxxxx X. and Xxxxxx X. Xxxxx, JT 150 Common
Xxxxxx Xxxxxxxxxxxx 10 Common
Life Success Ventures Inc. 5 Common
Transam Holdings Inc. 30 Common
Xxx Xxxxxxx 10 Common
Xxxxxx Xxxxxx 5 Common
Xxxxxx Xxxxx, in trust 85 Common
