PURCHASE AGREEMENT
AGREEMENT made as of this 23rd day of March, 2000, by and among
XXXXXXXXXXXXXXX.XXX INC., an Arizona corporation ("ATC"), LLOYDMINISTER
ENTERPRISES INC. ("LEI"), and KINDERSLEY HOLDINGS INC. ("KHI").
WHEREAS, ATC currently owns 5,500,000 shares or 55% of the 10,000,000 shares of
common stock of XxxxxxxxXxxxxXxxxxx.xxx, an Arizona corporation ("BTC"), which
are issued and outstanding ; and
WHEREAS, LEI currently owns 4,500,000 shares of common stock or 45% of BTC (the
"Shares"); and
WHEREAS, KHI is the holder of a promissory note from BTC in the principal
amount of $200,000, which is convertible into shares of BTC common stock (the
"Promissory Note"); and
WHEREAS, ATC desires to acquire 100% of the equity interest in BTC and LEI and
KHI are willing to sell their interests to ATC;
NOW, THEREFORE, in consideration of the foregoing and the mutual promises and
covenants herein contained, the parties hereto agree as follows:
1. Upon the Closing of this transaction, LEI shall sell, assign,
transfer, and deliver to ATC and ATC shall purchase from LEI the
Shares. The purchase price shall be 5,000,000 restricted shares of
common stock of ATC (the "ATC Stock"). LEI shall endorse the stock
certificate(s) representing the Shares in blank or deliver an executed
stock power.
2. Upon the Closing of this transaction, KHI shall sell, assign,
transfer, and deliver to ATC and ATC shall purchase from KHI the
Promissory Note. The purchase price shall be US$200,000. KHI shall
execute an Assignment of Note in the form attached hereto as Exhibit A.
3. The Closing of the purchase and sale provided for by this Agreement
shall take place at the office of ATC, 0000 Xxxx Xxxxxxxx, Xxxxx 0,
Xxxxxxxxxx, Xxxxxxx, xx Monday, March 27, 2000, at 1:00 p.m.
4. LEI represents and warrants to ATC that:
(a) LEI is the sole and exclusive record and beneficial owner of
the Shares. LEI possesses good and merchantable title to the
Shares, and owns the Shares free and clear of any and all
security interests, agreements, restrictions, claims, liens,
pledges, and encumbrances of any nature or kind. LEI has the
absolute and unconditional right to sell, assign, transfer,
and deliver the Shares to ATC in accordance with the terms of
this Agreement.
PURCHASE AGREEMENT - Page 1
(b) LEI has full right, power, and authority to enter into this
Agreement. This Agreement is a valid and legally binding
obligation of LEI and is fully enforceable against LEI in
accordance with its terms, except as such enforceability may
be limited by general principles of equity, bankruptcy,
insolvency, moratorium, and similar laws relating to
creditors' rights generally.
5. KHI represents and warrants to ATC that:
(a) KHI is the sole and exclusive record and beneficial owner of
the Promissory Note. KHI possesses good and merchantable
title to the Promissory Note, and owns the Promissory Note
free and clear of any and all security interests, agreements,
restrictions, claims, liens, pledges, and encumbrances of any
nature or kind. KHI has the absolute and unconditional right
to sell, assign, transfer, and deliver the Promissory Note to
ATC in accordance with the terms of this Agreement.
(b) KHI has full right, power, and authority to enter into this
Agreement. This Agreement is a valid and legally binding
obligation of KHI and is fully enforceable against KHI in
accordance with its terms, except as such enforceability may
be limited by general principles of equity, bankruptcy,
insolvency, moratorium, and similar laws relating to
creditors' rights generally.
6. ATC represents and warrants to LEI and KHI that:
(a) ATC is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Arizona. ATC
has all requisite corporate power to enter into this
Agreement and to perform its obligations hereunder.
(b) The execution, acknowledgment, delivery, and performance of
this Agreement by ATC, and the consummation by ATC of the
transactions contemplated hereby, have been duly and validly
authorized by ATC. This Agreement has been duly executed,
acknowledged, and delivered by ATC and is a legal, valid, and
binding obligation of ATC, enforceable against ATC in
accordance with its terms, except as such enforceability may
be limited by general principles of equity, bankruptcy,
insolvency, moratorium, and similar laws relating to
creditors' rights generally.
7. The consummation of this Agreement and the issuance of the ATC Stock
as contemplated herein constitutes the offer and sale of securities as
those terms are defined in the Securities Act of 1933 (the "Securities
Act") and applicable state statutes. Such transactions shall be
consummated in reliance on certain exemptions from the registration
requirements of the Securities Act and applicable state statutes which
depend, upon other items, on the circumstances under which such
securities are acquired. Accordingly, LEI represents and warrants that:
PURCHASE AGREEMENT - Page 2
(a) LEI acknowledges that neither the Securities and Exchange
Commission nor the securities commission of any state or
other federal agency has made any determination as to the
merits of acquiring the ATC Stock and that the acquisition
and ownership of the ATC Stock involves certain risks.
(b) LEI has received and read this Agreement and the Registration
Statement of ATC on Form S-1 filed October 12, 1999, the
quarterly reports on Form 10-Q for the quarters ended
September 30, 1999 and December 31, 1999 and the current
reports on Form 8-K dated February 17, 2000 and February 29,
2000, and understand the risks related to the consummation of
the transactions herein contemplated. LEI has been given an
opportunity to meet with and ask questions of management of
ATC concerning the business, operations and assets of ATC
and the transactions contemplated by this Agreement.
(c) LEI has such knowledge and experience in business and
financial matters that it is capable of evaluating ATC and
its business operations.
(d) LEI is acquiring the ATC Stock for its own account and not
with a view for resale to others.
(e) LEI has not offered or sold any securities of ATC or interest
in this Agreement and has no present intention of dividing
the ATC Stock to be received or the rights under this
Agreement with others or of reselling or otherwise disposing
of any portion of such stock or rights, either currently or
after the passage of a fixed or determinable period of time
or on the occurrence or nonoccurrence of any predetermined
event or circumstance.
(f) LEI has adequate means of providing for its current needs and
possible contingencies and has no need now, and anticipates
no need in the foreseeable future, to sell the ATC Stock.
LEI is able to bear the economic risks of this investment,
and, consequently, without limiting the generality of the
foregoing, is able to hold the ATC Stock to be received for
an indefinite period of time and has a sufficient net worth
to sustain a loss of the entire investment, in the event such
loss should occur.
(g) LEI understands that the ATC Stock has not been registered,
but is being acquired by reason of a specific exemption under
the Securities Act as well as under certain state statutes
for transactions by an issuer not involving any public
offering and that any disposition of the subject ATC Stock
may, under certain circumstances, be inconsistent with this
exemption and may make LEI an "underwriter" within the
meaning of the Securities Act. It is understood that the
definition of "underwriter" focuses upon the concept of
"distribution" and that any subsequent disposition of the
subject ATC Stock can only be effected in transactions which
are not considered synonymous with "public offering" or any
other offer or sale involving general solicitation or general
advertising. Under present law, in determining whether a
distribution occurs when securities are sold into the public
market, under certain circumstances one must consider the
availability of public information regarding the issuer,
a holding period for the securities sufficient to
PURCHASE AGREEMENT - Page 3
assure that the persons desiring to sell the securities
without registration first bear the economic risk of their
investment, and a limitation on the number of securities
which the shareholder is permitted to sell and on the manner
of sale, thereby reducing the potential impact of the sale on
the trading markets. These criteria are set forth
specifically in Rule 144 promulgated under the Securities Act,
and after one year after the date the ATC Stock is fully paid
for, as calculated in accordance with Rule 144(d), sales of
securities in reliance upon Rule 144 can only be made in
limited amounts in accordance with the terms and conditions
of that Rule. After two years from the date the securities
are fully paid for, as calculated in accordance with Rule
144(d), they can generally be sold without meeting those
conditions, provided the holder is not (and has not been for
the preceding three months) an affiliate of the issuer.
(h) LEI acknowledges that the shares of ATC Stock must be held
and may not be sold, transferred or otherwise disposed of for
value unless they are subsequently registered under the
Securities Act or an exemption from such registration is
available. ATC's registrar and transfer agent will maintain
a stop transfer order against the registration of transfer of
the ATC Stock, and the certificates representing the ATC
Stock will bear a legend in substantially the following form
so restricting the sale of such securities:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") AND ARE "RESTRICTED SECURITIES" WITHIN THE
MEANING OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
SOLD OR TRANSFERRED WITHOUT COMPLYING WITH RULE 144 IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION OR OTHER COMPLIANCE
` UNDER THE SECURITIES ACT.
(i) ATC may refuse to register transfer of the ATC Stock in the
absence of compliance with Rule 144 unless LEI furnishes ATC
with an opinion of counsel reasonably acceptable to ATC
stating that the transfer is proper.
8. ATC agrees to register the ATC Stock in a registration statement filed
under the Securities Act. The registration statement shall be filed
not less than 30 days and not more than 120 days after the date of
this Agreement. LEI shall provide the information necessary to
disclose it as a "selling security holder" in the registration
statement and agrees that it shall not sell more than 20% of the ATC
Stock in any month.
9. This Agreement constitutes the entire agreement between the parties
hereto with respect to the subject matter hereof, and amends and
supersedes any prior agreements between the parties concerning the
sale of the Shares and the Promissory Note.
10. This Agreement shall not be assignable by any party hereto without the
prior written consent of the other parties hereto.
11. This Agreement is made and entered into, and shall be governed by and
construed in accordance with, the laws of the State of Arizona.
PURCHASE AGREEMENT - Page 4
12. The parties hereto acknowledge that the Shares and the Promissory Note
are unique; that any claim for monetary damages may not constitute an
adequate remedy; and that it may therefore be necessary for the
protection of the parties and to carry out the terms of this Agreement
to apply for the specific performance of the provisions hereof. It is
accordingly hereby agreed by all parties that no objection to the form
of the action or the relief prayed for in any proceeding for specific
performance of this Agreement shall be raised by any party, in order
that such relief may be expeditiously obtained by an aggrieved party.
All parties may proceed to protect and enforce their rights hereunder
by a suit in equity, transaction at law, or other appropriate
proceeding, whether for specific performance or for an injunction
against a violation of the terms hereof or in aid of the exercise of
any right, power, or remedy granted hereunder or by law, equity, or
statute or otherwise. No course of dealing and no delay on the part
of any party hereto in exercising any right, power, or remedy shall
operate as a waiver thereof or otherwise prejudice its rights, powers,
or remedies, and no right, power, or remedy conferred hereby shall be
exclusive of any other right, power, or remedy referred to herein or
now or hereafter available at law, in equity, by statute, or otherwise.
13. LEI and KHI jointly and severally agree to execute, acknowledge, and
deliver, after the date hereof, without additional consideration, such
further assurances, instruments, and documents, and to take such
further actions, as ATC may request in order to fulfill the intent of
this Agreement and the transactions contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the date first above written.
"ATC" "LEI"
XXXXXXXXXXXXXXX.XXX INC. LLOYDMINISTER ENTERPRISES INC.
By: /s/ Xxxxx X. Xxxxxxxxxx By: /s/
----------------------------------- ------------------------------
Xxxxx X. Xxxxxxxxxx, President
"KHI"
KINDERSLEY HOLDINGS INC.
By:/s/
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PURCHASE AGREEMENT - Page 5
