Exhibit 10.19
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT ("Agreement") is made as of the 26th day of
February, 2004, by and between INNOVATIVE SOFTWARE TECHNOLOGY, INC ("IST"), a
California corporation, ENERGY PROFESSIONAL MARKETING GROUP, INC ("EPMG"), a
Utah corporation which is a wholly owned subsidiary of IST, and ▇▇▇▇▇ ▇. ▇▇▇▇
("▇▇▇▇') and ▇▇▇▇▇ ▇ ▇▇▇▇▇▇ ("▇▇▇▇▇▇")
Recitals
▇. ▇▇▇▇ and ▇▇▇▇▇▇ formed EPMG in 1999;
B. Subsequently, ▇▇▇▇ and ▇▇▇▇▇▇ entered into a Stock Purchase Agreement
dated December 31, 2001, whereby IST acquired all of the capital stock of EPMG
from ▇▇▇▇ and ▇▇▇▇▇▇ in exchange for voting stock of IST;
C. Simultaneously with their sale of EPMG to IST, ▇▇▇▇ and ▇▇▇▇▇▇ entered
into identical employment agreements with EPMG, which employment agreements were
amended on July 15, 2002 (collectively, the "Employment Agreements");
▇. ▇▇▇▇ and ▇▇▇▇▇▇ have since asserted a number of breach of contract
claims against IST, many of which are based on IST's representations to ▇▇▇▇ and
▇▇▇▇▇▇;
▇. ▇▇▇▇ and ▇▇▇▇▇▇ have also asserted that the Employment Agreements are
void and are not enforceable under Utah law, and
▇. ▇▇▇▇ and ▇▇▇▇▇▇ have agreed to waive, release and compromise their
breach of contract claims against IST with respect to the Stock Purchase
Agreement in exchange for the
cancellation by EPMG of, and IST's waiver of any rights it holds in the
Employment Agreements.
NOW, THEREFORE, in consideration of the mutual covenants and promises set
forth herein, together with other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Exchange. IST, as parent of EPMG, hereby releases and disclaims any
interest it has relating to the Employment Agreements and waives any claim it
may have against EPMG, its officers or directors relating to EPMG's cancellation
of the Employment Agreements as set forth herein. EPMG hereby cancels the
Employment Agreements Each of ▇▇▇▇ and ▇▇▇▇▇▇ releases IST and EPMG and their
respective officers and directors from any and all causes of action, judgments,
executions, claims and demands, of every kind and nature whatsoever, based upon
IST's alleged breaches of contract under the terms of the Stock Purchase
Agreement.
2. Effective Date. The foregoing exchange transaction is effective
immediately upon the parties' execution of this Exchange Agreement and the
delivery by each party of an executed copy of this Agreement to each other
party.
3. Further Assurances. Each party shall execute and deliver such documents
as any other party shall reasonably deem necessary or appropriate to cause the
parties to obtain the benefits contemplated by this Agreement
4. Representations and Warranties of IST and EPMG. Each of IST and EPMG
hereby represents and warrants to each of ▇▇▇▇ and ▇▇▇▇▇▇ that:
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(a) IST and EPMG have full legal authority to enter into this Agreement
and upon execution and delivery hereof this Agreement will be a valid and
binding obligation of IST and EPMG, enforceable against them in accordance of
its terms.
(b) IST and EPMG are not required to give any notice to or obtain any
consent from any person in connection with the execution and delivery of this
Agreement or the consummation and performance of the exchange contemplated
hereby.
(c) Neither the execution and delivery of this Agreement, nor the
consummation or performance of the exchange contemplated hereby, will
contravene, conflict with or result in a violation of any contract or
organizational document applicable to IST.
(d) Neither IST, EPMG nor their agents have incurred any obligation or
liability, contingent or otherwise, for a brokerage or finders fee or agent's
commission or other similar payment in connection with this Agreement for which
▇▇▇▇ or ▇▇▇▇▇▇ may be liable.
5. Representations and Warranties of the Shareholders. Each of ▇▇▇▇ and
▇▇▇▇▇▇ hereby severally represents and warrants to IST that:
(a) He has full legal authority to enter into this Agreement and
upon execution and delivery hereof this Agreement will be his valid and binding
obligation, enforceable against him in accordance of its terms.
(b) He is not required to give any notice to or obtain any consent
from any person in connection with the execution and delivery of this Agreement
or the consummation and performance of the exchange contemplated hereby.
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(c) Neither the execution and delivery of this Agreement, nor the
consummation or performance of the exchange contemplated hereby, will
contravene, conflict with or result in a violation of any contract applicable to
him.
(d) Neither he nor any of his affiliates has incurred any obligation
or liability, contingent or otherwise, for brokerage or finder's fees or agent's
commissions or similar payments in connection with this Agreement for which IST
may be liable.
6. Notice. Any notice which is required or permitted to be given to any
party to this Agreement shall be deemed to have been given only if such notice
is reduced to writing and delivered, either personally or by a reputable
courier, with return receipt delivered, to the appropriate party as set forth
below
Innovative Software Technology, Inc.
▇▇▇ ▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With a copy to J. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Holme ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
7 Miscellaneous Matters
(a) This Agreement shall not be assigned by any party without the
prior written consent of each other party.
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(b) The Agreement shall be binding upon and shall inure to the
benefit of the parties hereto, their successors and assigns.
(c) Should a default occur in the performance of any obligation set
forth in this Agreement, the defaulting party shall pay to the other party, in
addition to any damages which result from such default, the related costs and
expenses, including reasonable attorneys' fees, incurred by the non-defaulting
party in enforcing his or its rights hereunder.
(d) This Agreement shall be construed in accordance with and
governed by the internal laws of the State of Utah.
(e) This Agreement constitutes the complete and entire statement of
all terms, conditions and representations of the agreement between IST, on the
one hand, and ▇▇▇▇ and ▇▇▇▇▇▇ on the other, with respect to its subject matter.
(f) Nothing in this Agreement, express or implied, is intended to
confer upon any person not a party to this Agreement any rights or remedies of
any nature whatsoever under or by reason of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement upon the date
first herein written.
Seller
ENERGY PROFESSIONAL
MARKETING GROUP, a Utah corporation
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title CEO
Seller
INNOVATIVE SOFTWARE
TECHNOLOGIES, INC., a
California corporation
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title President
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇ ▇▇▇▇▇▇
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