EXHIBIT 2(A)
STOCK PURCHASE AGREEMENT
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This STOCK PURCHASE AGREEMENT (the "Agreement") is made as of January 31,
2002, by and among GREENLAND CORPORATION, a Nevada corporation ("Buyer"); W3M,
INC., a California corporation doing business as Paradigm Cabling Systems (the
"Company"); and ASHFORD CAPITAL LLC, a California Limited Liability Company,
REGENTS CAPITAL WEST, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, MONDO ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Sellers"), the shareholders of the Company as
identified on the attached Schedule A.
RECITALS
WHEREAS, Sellers own of record and beneficially all issued and outstanding
shares of Capital Stock of the Company (the "Sellers' Shares" or the
"Outstanding Shares"); and
WHEREAS, Buyer desires to acquire all of Sellers' Shares upon the terms and
conditions of this Agreement;
NOW, THEREFORE, in consideration of the covenants and mutual agreements set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in reliance upon the
representations and warranties contained herein, the parties do hereby agree as
follows:
1. ACQUISITION OF STOCK; PAYMENT OF CONSIDERATION 1.@THE MERGERTHEREFOR
1.1 General1.1@General. At the Closing (as hereinafter defined), the
Sellers shall convey, transfer, and assign, upon the terms and conditions herein
set forth, to Buyer, (1) a certificate or certificates, registered in the
Buyer's name and representing the Shares, The Shares shall be delivered free and
clear of all liens, security interests, pledges, claims, and encumbrances of
which Sellers have actual notice; and (2) an Assignment of joint rights with
Sellers under and to the Convertible Preferred Stock Purchase Agreement of
January 11, 2002 and Convertible Preferred Stock Purchase Agreement of January
15, 2002, (attached hereto as Exhibits "1.1 ," and "1.1A" .").
1.2 The Promissory Note and Pledge Agreement.1.2@Effect of the Merger The
Promissory Note ("Promissory Note,") shall be in the principal amount of Two
Million Nine Hundred Sixteen Thousand Six Hundred Sixty Seven Dollars
($2,916,667), shall bear interest at the rate of Seven percent per annum, shall
be payable in installments of (i) One Million Dollars ($1,000,000) principal
(plus accrued interest to the date of payment) not later than June 30, 2003 (the
"First Installment Payment") and (ii) One Million Nine Hundred Sixteen Thousand
Six Hundred Sixty seven ($1,916,667) principal (plus accrued interest to the
date of payment) not later than June 30, 2004 (the "Second Installment
Payment"). The Promissory Note may be prepaid in whole or in part at any time
without penalty. The Promissory Note shall be in the form attached as Exhibit
1.2-A to this Agreement. The Promissory Note shall be secured by Buyer's pledge
of Sellers' Stock pursuant to the terms of a pledge agreement (the "Pledge
Agreement") executed by Buyer and delivered to Sellers at the Closing.
Notwithstanding any other provisions of this Agreement to the contrary, if
Pledgor has paid Pledgees at least One Million Dollars ($1,000,000) in principal
under the Note, plus all accrued interest thereon to the date of such principal
payment, but thereafter defaults under the Note, (i) Pledgees may retain all
such payments received from Pledgor; (ii) Pledgees shall reacquire title to all
of Seller's Stock minus whatever stock was paid for above the One Million
Dollars ($1,000,000) deduction. Any stock retained by the Seller will be free
and clear of this Pledge Agreement and any other rights or claims of Pledgees
thereto; and (iii) Sellers shall release Buyer from any and all other
obligations in connection with payment of the Note and the Purchase Price as
defined in the Purchase Agreement.
Buyer contemplates commencing a private placement equity offering and/or similar
offering (the "Offering"), which it anticipates will be the primary source of
funding for this transaction, on or about June 30, 2002
Buyer will, on a monthly basis, during the term of the Offering should it occur,
pay to Sellers, against the Promissory Note, an amount equal to 33% of net
proceeds received by Buyer from the Offering (the "Buyer Monthly Payment").
"Net proceeds received by Buyer from the Offering" means the gross dollars
received by Buyer in the Offering less commissions and expenses related to the
Offering, which Buyer estimates at approximately 50%.
If the Buyer Monthly Payment exceeds the amount due on the First Installment
Payment prior to the due date thereof, Buyer shall apply said additional amounts
toward the Second Installment Payment until the Second Installment Payment is
paid in full.
2. CERTIFICATES OF TITLE TO SELLERS; ORIGINALS OF AGREEMENTS
At Closing, Buyer shall execute Certificates of Title in Secured Promissory Note
and Pledge Agreement to the Sellers, and each of them, in the form set forth in
Exh. "2.0 ", attached hereto. Sellers may publish, record, or otherwise use
the Certificates to evidence their title in and to the Promissory Note and
Pledge Agreement. The original of this Agreement, the Promissory Note, Pledge
Agreement, and Convertible Preferred Stock Purchase Agreements of January 11 and
15, 2002 shall be held in trust for all Sellers by Ashford Capital LLC at its
office and may be inspected and/or copied by any person designated by any party
hereto during regular business hours. The Certificate of Title shall certify
that each Seller is, respectively, the joint and several holder of the Note with
a right to the proceeds of the Note in the following percentages: Seller ASHFORD
CAPITAL, LLC: ___%; Seller ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇: ___% Seller REGENTS CAPITAL WEST:
_____ %: Seller MONDO ▇▇▇▇▇▇▇▇ : ______%; Seller ▇▇▇▇▇▇ ▇▇▇▇▇▇▇; Seller ▇▇▇▇
▇▇▇▇▇▇: ____ % and Seller ▇▇▇▇ ▇. ▇▇▇▇▇▇: ___%.2.@THE SURVIVING CORPORATION
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3. REPRESENTATIONS AND WARRANTIES OF COMPANY AND SHARE-HOLDERS; ASSIGNMENT
OF RIGHTS3.@REPRESENTATIONS AND WARRANTIES OF COMPANY AND SHARE-HOLDERS
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The Sellers make no Representations or Warranties but assign to Buyer joint
rights with Sellers to and reliance upon the Representations and Warranties of
the Company and the original shareholders of the Company as set forth in the
Convertible Preferred Stock Purchase Agreements of January 11, 2002 and January
15, 2002 (Exhibits "1.1 " and "1.1A .") Buyer has reviewed the said
Agreements and acknowledges the same and that the same serves as good
consideration for the covenants, warranties and representations of Buyer herein.
The parties further agree that the assignment of such rights by Sellers does not
create any new or additional rights against the Company or the original
shareholders, which the latter parties did not assume in the Convertible
Preferred Stock Purchase Agreement of January 11, 2002, but permits Buyer to
jointly enjoy and enforce any rights of Sellers, or any of them, under the said
Agreement and/or the Convertible Preferred Stock Purchase Agreement
of January 15, 2002.
4. REPRESENTATIONS AND WARRANTIES OF BUYER AND SUBSIDIARY4.@REPRESENTATIONS
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AND WARRANTIES OF PARENT AND SUBSIDIARY
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As an inducement to Company and Sellers to enter into this Agreement and to
consummate the transactions contemplated hereby, Buyer hereby represents,
warrants and covenants as follows:
4.1 Organization, Qualification and Authority4.0@Organization,
Qualification and Authority.
(a) Buyer is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization, which is
listed on Schedule 4.1. and has principal offices and places of business at the
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locations specified in Schedule 4.1. Buyer has all requisite corporate power,
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and all requisite franchises, licenses, permits and authority necessary to own
or lease its assets and to carry on its business as, and in all places where,
such business is now conducted and such properties are owned or leased.
(b) Buyer has the full corporate power to enter into, execute and
perform this Agreement. This Agreement has been duly and validly executed and
delivered by Buyer and constitutes the valid and legally binding obligation of
Buyer, subject to general equity principles, enforceable in accordance with
their respective terms, except as the same may be limited by bankruptcy,
insolvency, reorganization or similar Laws affecting the rights of creditors
generally.
4.2 No Inconsistent Obligations4.0@No Inconsistent Obligations. The
execution, delivery or performance of this Agreement will not result in a
violation or breach of, or constitute a default under (i) the articles of
incorporation or bylaws of Buyer, (ii) any term or provision of any indenture,
note, mortgage, bond, security agreement, loan agreement, guaranty, pledge, or
other instrument, contract, agreement or Order to which Buyer is a party or by
which Buyer is subject or bound; nor will such actions result in (a) the
creation of any Lien on any of the Buyer Stock or any of the assets or
properties of Buyer, (b) the acceleration or creation of any Liability of Buyer,
(c) the forfeiture of any material right or privilege of Buyer, or (d) the
forfeiture of any material right or privilege of Buyer which may affect Buyer's
ability to perform under this Agreement.
4.3 Consents4.0@Consents. The execution, delivery and performance of
this Agreement do not (a) require the consent, approval or action of, or any
filing with, or notice to, any Person, except as has been or by the time of
closing will be made, given or obtained or (b) impose any other term, condition
or restriction on Buyer pursuant to any business combination or takeover Law.
4.4 No Violation; Compliance with Laws4.0@No Violation; Compliance
with Laws. Buyer is not in default under or in violation of (a) its articles of
incorporation or bylaws, or (b) any Order. The operations of Buyer and its
predecessors have been conducted in all material respects in compliance with all
applicable Laws. (For purposes of this paragraph, any violation of applicable
Law that could result in imposition of a fine or other monetary penalty in
excess of $500 upon Buyer shall be deemed to be a material non-compliance).
Buyer has not received any notification of any asserted past or present failure
by such Entity to comply with any applicable Law.
4.5 Taxes4.0@Taxes.
(a) Except as set forth in Schedule 4.2, Buyer has timely filed all federal,
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state, local, and foreign tax returns, reports and estimates for all years and
periods (and portions thereof) for which any such reports, returns or estimates
were due with respect to any Taxes. All such returns and estimates were
prepared in the manner required by applicable Law and show the correct and
proper amount due. All Taxes shown thereby to be payable (or that are otherwise
payable) have been paid. Except as disclosed on Schedule 4.2, there are no
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Taxes due and owing by Buyer of any kind or nature.
(b) All Taxes imposed on Buyer by any Governmental Authority
(including all deposits in connection therewith required by applicable Law, and
all interest and penalties thereon) which have become due and payable by Buyer
for all periods through the date hereof have been paid in full, and adequate
reserves for all other Taxes, whether or not due and payable, and whether or not
disputed, have been set up on the books of Buyer, and such reserves will be
adequate to pay all Taxes of Buyer for all periods through Closing. There is
not now any proposed assessment against Buyer of additional Taxes of any kind.
Buyer is not a party to any Tax sharing or Tax allocation agreement,
understanding, arrangement or commitment. There is no dispute or Action
concerning any Tax Liability of Buyer raised by a Governmental Authority in
writing.
(c) There are no Liens for Taxes upon any assets of Buyer except
Liens for Taxes not yet due.
(d) Except as set forth in Schedule 4.2 (which shall set forth
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the type of return, date filed, and date of expiration of the applicable statute
of limitations), (i) the statute of limitations for the assessment of federal
income taxes has expired for all federal income tax returns of Buyer or such
returns have been examined by the Internal Revenue Service for all periods
through December 31, 2000; (ii) the statute of limitations for the assessment of
state, local, and foreign income taxes has expired for all applicable returns of
Buyer or such returns have been examined by the appropriate tax authorities for
all periods through December 31, 2000; and (iii) no deficiency for any Taxes has
been proposed, asserted or assessed against Buyer that has not been resolved and
paid in full.
(e) There are no outstanding written waivers or consents regarding
the application of the statute of limitations with respect to any taxes or
returns that have been given by Buyer.
(f) Buyer has complied in all material respects with all
applicable laws, rules and regulations relating to the payment and withholding
of Taxes (including, without limitation, withholding of Taxes pursuant to 1441
or 1442 of the IRC or similar provisions under any foreign laws) and have,
within the time and in the manner prescribed by law, withheld from employee
wages and paid over to the proper Governmental Authorities all amounts required
to be so withheld and paid over under all applicable Laws.
(g) Except as set forth in Schedule 4.2 Buyer has not filed any
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consent agreement under 341(f) of the IRC or agreed to have 341(f)(2) the IRC
apply to any disposition of a subsection (f) asset (as such term is defined in
341(f)(4) of the IRC) owned by Buyer.
(h) Except as set forth in Schedule 4.2, Buyer is not a party to
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any tax-sharing or allocation agreement, nor does Buyer owe any amount under any
tax-sharing or allocation agreement.
4.6 Insurance4.0@Insurance. Schedule 4.3 contains a description of
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the officer and director insurance policy maintained by Buyer, which is in full
force and effect. Buyer has delivered or made available to Sellers a true,
correct and complete copy of such insurance policy (including any exhibits,
schedules, riders, amendments or modifications thereof.) All premiums due
thereon have been paid and Buyer has not received any notice of cancellation
with respect thereto. Except as set forth on Schedule 4.16, there are no
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occurrences which may form the basis for a material claim by or on behalf of
Buyer under such policy; and Buyer has timely given notice of all such
occurrences to the appropriate insurer and has not waived (either intentionally
or, to Buyer's knowledge, inadvertently) its right to make the related claim
under such policy.
4.7 Full Disclosure4.0@Full Disclosure. No representation, warranty or
covenant of Buyer contained in this Agreement, in the Buyer Disclosure Schedules
or in any other written statement or certificate delivered by Buyer, pursuant to
this Agreement, or in connection with the transactions contemplated herein,
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary to make the statements contained
herein or therein not misleading.
5. ADDITIONAL AGREEMENTS5.@ADDITIONAL AGREEMENTS
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5.1 Cooperation5.1@Cooperation. The parties shall cooperate fully with
each other and with their respective counsel and accountants in connection with
any steps required to be taken as part of their respective obligations
hereunder, and all parties shall use commercially reasonable efforts to
consummate the transactions contemplated herein and to fulfill their obligations
hereunder. From time to time and at any time, at Buyer's request, whether on or
after the date hereof, and without further consideration, Sellers shall, at
their expense, execute and deliver such further documents and instruments of
conveyance, assignment, and transfer and shall take such further reasonable
actions as may be necessary or desirable, in the opinion of Buyer, in connection
with the consummation of the transactions described herein.
5.2 Expenses5.2@Expenses. All expenses incurred by Buyer, Company or
Sellers in connection with the negotiation, authorization, preparation,
execution and performance of this Agreement, including, without limitation, all
fees and expenses of agents, Representatives, counsel and accountants, shall be
paid by the respective party which incurred such expense.
5.3 Brokers5.3@Brokers. Buyer shall indemnify Sellers and hold them
harmless from and against all claims or demands for commissions or other
compensation by any broker, finder, or similar agent claiming to have been
employed by or on behalf of Buyer. Sellers advise Company of a claim by the
Geneva Companies for a commission on the sale of the stock of the Company by the
original shareholders and assign a joint right against the Company and original
shareholders with respect thereto as to the extent or nature of the said
commission, which has been previously disclosed to Buyer.
5.4 Employment Agreements5.4@Employment Agreements. Contemporaneously
with the Closing, such persons as Buyer may approve, each and collectively
representing the executive management of Company, shall enter into an employment
agreement with Buyer ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, in substance and form mutually agreeable
to the parties thereto (the "Employment Agreement"). The Employment Agreement
shall define such manager's salary, bonus opportunity, and other elements
constituting the manager's employment terms and conditions with Buyer or
Company.
5.5 Disclosure; Publicity5.5@Disclosure; Publicity. No press release
related to this Agreement or the transactions contemplated herein, or other
announcement to the public, personnel, customers, or suppliers of Sellers or
Company will be issued or made without the joint approval of Buyer and Sellers.
Buyer and Sellers will cooperate to prepare a joint (or other appropriate) press
release to be issued on or promptly following the Closing Date or, upon the
request of either Buyer or Sellers, at the time of the signing of this
Agreement. No party shall disclose the terms hereof except as required in
connection with the performance of the terms hereof or by an Order or applicable
Law, without first discussing such disclosure with the other parties.
5.6 No Solicitation of Transactions5.5@No Solicitation of Transactions.
Prior to the termination of this Agreement or the Closing, the parties hereto
will not, and will direct their respective officers, directors, financial
advisors, counsels and other agents or Representatives not to, directly or
indirectly (a) solicit proposals from, negotiate with or provide Information to
any other Person with respect to the transfer of any Capital Stock or assets of
Company. If, despite this provision, Company or any of its Representatives
receive such a proposal or inquiry, Company shall promptly inform Buyer and
advise such Person of this restriction.
5. 7 Directors and Officers Liability Insurance. From and after the
Closing, Buyer shall maintain a directors and officers liability insurance
policy reasonably acceptable to its board of directors.
5. 8 Employee Matters. Buyer agrees that, as of the Closing Date,
participation in Buyer's benefit plans, as then in effect, shall be made
available to all employees of the Company. Vesting and eligibility shall be
credited to ▇▇▇▇ ▇▇▇▇▇▇▇▇ and all waiting periods and pre-existing condition
limitations shall be waived under such Buyer benefit plans to the full extent
permitted by the plans of Buyer, and not otherwise prohibited by law.
Notwithstanding the foregoing, Buyer shall not be obligated to offer employment
to or retain the employees of the Company on or after the Closing Date.
6. COVENANTS PRIOR TO CLOSING6.@COVENANTS PRIOR TO CLOSING
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6.1 Covenants and Agreements of Company and Sellers6.1@Covenants and
Agreements of Company and the Shareholders. The following covenants and
agreements of Company and Sellers shall be effective from the date hereof to the
Closing, unless Buyer shall consent in writing to the waiver of any such
covenant or agreement: For the purpose of this Article, the term "Seller" shall
refer only to Seller ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇. The other Sellers do not currently or
previously have any active role in the management of the Company:
(a) Company and Seller shall conduct the operations of Company
only in the ordinary and usual course and consistent with prior practices,
without the creation of any additional indebtedness for borrowed money, except
in the ordinary and usual course of business.
(b) Company and Seller shall not cause Company to enter into any
contracts, agreements or other arrangements to provide, sell, rent, lease,
license, distribute or supply goods or services to any customer or any third
party except in the ordinary course of its operations at prices and on terms
consistent with the prior operating practices of Company.
(c) Company and Seller shall maintain, preserve and protect all of
Company's assets in good condition, except for ordinary wear and tear and damage
by fire or other casualty.
(d) Company and Seller shall maintain the books, records and
accounts of Company in the usual, regular and ordinary course of business on a
basis consistent with prior practices and in accordance with GAAP except as
disclosed on Schedule 3.7.
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(e) Company and Seller shall use their best efforts to preserve
Company's business, to keep available the services of its present employees, to
preserve the goodwill of its suppliers, customers and others having business
relations with it.
(f) No action shall be taken by Company or Seller which shall make
any change in Company's Charter Documents, make any change in its authorized or
issued Capital Stock, shall issue or grant any right or option to purchase or
otherwise acquire any of its Capital Stock, shall declare or make a dividend or
other distribution or payment with respect to Company's Capital Stock, or,
directly or indirectly, redeem, purchase or otherwise acquire any of same.
(g) No action shall be taken by Company or Seller, which shall
cause Company to dissolve, liquidate or voluntarily declare bankruptcy or seek
the appointment of a receiver, trustee or custodian.
(h) the Company shall not grant any increase in the salary or
other compensation of its employees without the express written consent of
Buyer, except pursuant to the terms of employment agreements in effect on the
date hereof.
(i) the Company shall not take any action to institute any new
severance or termination pay practices with respect to any directors, officers
or employees of the Company or to increase the benefits payable under any
severance or termination payments.
(j) the Company shall not (except for salary increases for
employees who are not executive officers of the Company in the ordinary course
of business and consistent with past practice) adopt or amend, in any respect,
except as contemplated hereby or as may be required by applicable law or
regulation, any collective bargaining, bonus, profit sharing, compensation,
pension, retirement, deferred compensation, employment or other employee benefit
plan, agreement, trust, fund, plan, or arrangement for the benefit or welfare of
any directors, officers or employees.
6.2 Covenants and Agreements of Buyer6.2@Covenants and Agreements of
Target. The following covenants and agreements of Buyer shall be effective from
the date hereof to the Closing, unless Sellers shall consent in writing to the
waiver of any such covenant or agreement:
(a) Buyer shall conduct the operations of Buyer only in the
ordinary and usual course and consistent with prior practices, without the
creation of any additional indebtedness for borrowed money.
(b) Buyer shall not cause Buyer to enter into any contracts,
agreements or other arrangements to provide, sell, rent, lease, license,
distribute or supply goods or services to any customer or any third party except
in the ordinary course of their operations at prices and on terms consistent
with prior operating practices.
(c) Buyer shall maintain, preserve and protect, in good condition,
except for ordinary wear and tear and damage by fire or other casualty, all of
the assets of Buyer.
(d) Buyer shall maintain the books, records and accounts of Buyer
in the usual, regular and ordinary course of business on a basis consistent with
prior practices and in accordance with GAAP.
(e) Buyer shall use its best efforts to preserve Buyer's business,
to keep available the services of its present employees, to preserve the
goodwill of its suppliers, customers and others having business relations with
Buyer.
(f) Except as set forth in the Buyer Proxy Statement for the
Annual Shareholders Meeting on August 23, 2001, Buyer shall take no action to
(i) make any change in its Charter Documents or its authorized or issued Capital
Stock, (ii) issue or grant any right or option to purchase or otherwise acquire
any of its Capital Stock, (iii) declare or make a dividend or other distribution
or payment with respect to Buyer's Capital Stock, or (iv) directly or
indirectly, redeem, purchase or otherwise acquire any of same.
(g) No action shall be taken by Buyer to dissolve, liquidate or
voluntarily declare bankruptcy or seek the appointment of a receiver, trustee or
custodian.
7. CONDITIONS TO CLOSING
7.1 Conditions Precedent to Buyer's Obligations7.1@ConditionsPrecedent
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to Target's and Subsidiary's Obligations. Buyer's obligation to consummate the
transactions contemplated by this Agreement is subject to the satisfaction of
the following conditions on or before the Closing Date:
(a) the representations and warranties of Company and Sellers set
forth in Article 3 hereof shall be true and correct in all material respects at
and as of the Closing Date as if made on such date
(b Company and Sellers shall have performed in all material
respects all of the covenants and agreements required to be performed by them
under this Agreement prior to the Closing.;
(c) there shall have been no material adverse change in Company's
business;
(d) all material consents by third parties and all consents of
Governmental Authorities that are required for the consummation of the
transactions contemplated hereby, or in order to prevent a breach of, default
under, or a termination of any Contract shall have been obtained by Company and
Sellers;
(e) the Employment Agreement described in Section 5.4 shall have
executed and delivered;
(f) all registrations, filings, applications, notices, consents,
approvals, waivers, authorizations, qualifications and orders required to be
filed, made or obtained by Sellers or Company, including full and complete
cooperation in connection with preparation of unaudited financial statements of
Company, in order to consummate the transactions contemplated by this Agreement,
shall have been filed, made or obtained;
(g) Sellers shall have delivered any and all certificates as set
forth above, representing Sellers' Shares, duly endorsed for transfer, with an
irrevocable stock, power endorsed in blank, and such other documents,
instruments and agreements related thereto, as Buyer may reasonably request
(h) (i) no Law shall be in effect, pending, or proposed, and no
injunction or restraining order shall be in effect, and (ii) no Litigation shall
be pending or threatened, in each case that prohibits, prevents, or enjoins (or
materially interferes with) the carrying out of this Agreement or any of the
transactions contemplated hereby, or that declares unlawful the transactions
contemplated by this Agreement, or that would have a material adverse effect on
the right of Buyer to own, operate, use, or control the Company's business after
the Closing Date;
(i) on the Closing Date, Company shall have delivered to Buyer:
(i) certified copies of the resolutions duly adopted by Company's
boards of directors authorizing the execution, delivery, and performance of this
Agreement and any other agreements or instruments contemplated by this
Agreement;
(i ii) Certificate of the Secretary of State of California, dated a
current date, as to the legal existence and good standing of Company under
applicable Law;
(iii ) such other documents or instruments as Buyer may reasonably
request to effect the transactions contemplated hereby.
(j) review by auditors as to timing of audit of Company and
coordination of filing of Form 8K in compliance of securities laws.
Any condition specified in this Section 7.1 may be waived by Buyer.
7.2 Conditions to Company's and Sellers' Obligations7.2@Conditions to
Company's and the Shareholders' Obligations. Company's and Sellers' obligation
to consummate the transactions contemplated by this Agreement are subject to the
satisfaction of the following conditions on or before the Closing Date:
(a) the representations and warranties of Buyer set forth in
Article 4 hereof shall be true and correct in all material respects at and as of
the Closing Date as if made on such date;
(b) Buyer shall have performed in all material respects all of the
covenants and agreements required to be performed by it under this Agreement
prior to the Closing;
(c) Buyer shall have executed and delivered the employment
agreement described in Section 6.4;
(d) all registrations, filings, applications, notices, consents,
approvals, waivers, authorizations, qualifications and orders required to be
filed, made or obtained by Buyer, in order to consummate the transactions
contemplated by this Agreement shall have been filed, made or obtained;
(e) on the Closing Date, Buyer shall have delivered to Sellers the
Purchase Price., including the Promissory Note and Pledge Agreement described in
Article 1, as well as all Certificates of Title described in Article 2, and such
other documents, instruments, and agreements related thereto, as Sellers may
reasonably request;
(f) on the Closing Date, Buyer shall have delivered to Company:
(i) certified copies of the resolutions duly adopted by Buyer's boards
of directors authorizing the execution, delivery, and performance of this
Agreement and the transactions contemplated hereby;
( ii) Certificates of the Secretary of State of Nevada, dated a current
date, as to the legal existence and good standing of Buyer, under applicable
Law.
(iii ) such other documents or instruments as Company or Sellers may
reasonably request to effect the transactions contemplated hereby.
Any condition specified in this Section 8.2 may be waived by Company and
Sellers.
8. CLOSING8.@CLOSING
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8.1 Closing8.1@Closing. The transactions contemplated herein shall be
consummated (the "Closing") at the offices of Buyer, or such other place that
the parties mutually agree upon, on the second business day after the date on
which all conditions to Closing contained in Article 7 have been satisfied or
waived, or on and at such other time, date, and place as the Parties may
mutually agree (the "Closing Date").
8.2 Post-Closing Transactions8.2@Post-Closing Transactions. Sellers
shall deliver to Buyer a certificate satisfactory to Buyer that all duties,
taxes and other charges payable in respect of the delivery of the Shares have
been paid by Sellers.
8.3 Effect8.3@Effect. All deliveries, payments and other transactions
and documents relating to Closing shall be interdependent and none shall be
effective unless and until all are effective (except to the extent that the
party entitled to the benefit thereof has waived satisfaction or performance
thereof as a condition precedent to Closing).
8.4 Further Assurances8.4@Further Assurances. Each party shall, at the
request of any other party from time to time and at any time, whether on or
after the Closing Date, and without further consideration, execute and deliver
such assignments, transfers, assumptions, conveyances, powers of attorney,
receipts, acknowledgments, acceptances and assurances as may be reasonably
necessary to procure for the party so requesting, and its successors and
assigns, or for aiding and assisting in collecting and reducing to possession,
Sellers' Shares, or to otherwise satisfy and perform the obligations of the
parties hereunder.
9. INDEMNIFICATION9.@INDEMNIFICATION
---------------
9.1 Indemnification of a Buyer9.1@Indemnification of Target and
Surviving Corporation. Subject to the limitations set forth in Section 9.6,
Sellers assign joint rights to Buyer against the Company and the original
shareholders as set forth above in Sec. to indemnify and hold harmless Buyer and
its Affiliates, officers, directors, employees and agents (collectively, the
"Buyer Indemnitees") from, against and in respect of any and all Damages and
amounts paid in settlement pursuant to Section 9.4 (collectively, the "Buyer
Indemnified Losses") suffered or incurred by any Buyer Indemnitee by reason of,
or arising out of the representations and warranties of the Company and/or the
original shareholders in the Convertible Preferred Stock Purchase Agreement of
January 11, 2002, as follows. Otherwise, Sellers shall have no duty to expressly
or impliedly indemnify Buyer for any damages, causes of action legal equitable
or statutory, injuries, or detriment of any kind, arising out of or relating to
this Agreement, any other agreement or Exhibit, or any other promise, liability,
or obligation or any third-party claim, (except for a bad-faith failure of
----------------------------------
Sellers to execute and deliver their shares to Buyer at Closing). In the event
of any claim for indemnity, Buyer shall not tender the same to any Seller, but
shall assert the same as a joint holder and assignee thereof, against any person
who may be obligated to indemnify Buyer under the Convertible Stock Purchase
Agreements of January 11 and 15, 2002: and the assignment of the said rights to
Buyer by Sellers hereinabove
(a) any misrepresentation or breach of warranty of Company or
original shareholders assigned under this Agreement; and
(b) any breach or non-fulfillment or non-performance, partial or
total, of any covenant or any agreement of Company or original shareholders
contained in this Agreement, or in any certificate, schedule, instrument or
document delivered to Buyer by or on behalf of Company or Sellers pursuant to
the provisions of this Agreement; and
9.2 Indemnification of Sellers9.2@Indemnification of the Shareholders.
Subject to the limitations set forth in Section 9.6, Buyer shall indemnify and
hold Company and Sellers and their respective Affiliates, employees, agents,
successors and assigns (collectively, the "Seller Indemnitees") harmless from,
against and in respect of any and all Damages and amounts paid in settlement
pursuant to Section 9.4 (collectively, "Shareholder Indemnified Losses")
suffered or incurred by any Shareholder Indemnitees by reason of or arising out
of:
(a) any misrepresentation or breach of warranty of Buyer contained
in this Agreement, or in any certificate, schedule, instrument or document
delivered to Company or Sellers by or on behalf of Buyer pursuant to the
provisions of this Agreement, including, without limitation, the Buyer
Disclosure Schedules (collectively, the "Buyer Transaction Documents"); and
(b) any breach or non-fulfillment or non-performance, partial or
total, of any covenant or any agreement of Buyer contained in this Agreement, or
in any certificate, schedule, instrument or document delivered to Company or
Sellers by Buyer pursuant to the provisions of this Agreement; and
(c) any and all Taxes of Buyer with respect to any period (or
portion thereof) up to and including the Closing Date, except for Taxes of Buyer
that are reflected on any of the financial statements described in Section 5.7
as current liabilities for Taxes, which liabilities continue to exist as of the
Closing Date. The indemnity provided for in this Section 9.2(c) shall be
independent of any other indemnity provision hereof and, anything in this
Agreement to the contrary notwithstanding, shall survive until the expiration of
the applicable statute of limitation for the Taxes referred to herein, and any
indemnification regarding Taxes that is set forth in this Section 9.2(c) shall
not be subject to the provisions of Section 9.6(b) hereof.
9.3 Assertion of Claims9.3@Assertion of Claims. No claim shall be
brought by any Buyer Indemnitee under Section 9.1, or any Shareholder Indemnitee
under Section 9.2, and no respective indemnitee hereunder shall be entitled to
receive any payment with respect thereto, unless the party or parties to be
indemnified (whether one or more, the "Indemnified Party") gives the party or
parties from which indemnification is sought (whether one or more, the
"Indemnifying Party") written notice of the existence of any such claim,
specifying in reasonable detail the basis therefor, prior to the expiration of
the applicable Survival Period. Except as set forth in Section 9.5, if the
Indemnified and Indemnifying Parties fail to reach a mutually acceptable
resolution of such claim within thirty (30) days after the giving of such
notice, the Indemnified Party shall have the right to commence arbitration or
legal proceedings for the enforcement of its rights hereunder.
9.4 Defense of Third Party Claims9.4@Defense of Third Party Claims.
(a) If any claim or action by a third party arises after the Closing Date
for which an Indemnifying Party is liable under the terms of this Agreement,
then the Indemnified Party shall notify the Indemnifying Party, within thirty
(30) days after such claim or action arises and is known to the Indemnified
Party, and shall give the Indemnifying Party a reasonable opportunity, at its
sole cost and expense, to take part in any examination of the books and records
of Sellers, Company or Buyer, to conduct any proceedings or negotiations in
connection therewith and necessary or appropriate to defend the Indemnified
Party, to take all other required steps or proceedings to settle or defend any
such claim or action, and to employ counsel to contest any such claim or action
in the name of the Indemnified Party or otherwise. If the Indemnifying Party
wishes to assume the defense of such claim or action, it shall give written
notice to the Indemnified Party, and within ten (10) days thereafter the
Indemnified Party shall permit, and the Indemnifying Party shall thereafter
assume, the defense of any such claim or action, through counsel reasonably
satisfactory to the Indemnified Party; provided that the Indemnified Party may
participate in such defense at its own expense.
(b) If the Indemnifying Party does not assume the defense of any
such claim or action, then the Indemnified Party may defend against such claim
or action in such manner as it may deem appropriate (provided that the
Indemnifying Party may participate in such defense at its own expense);
provided, however, that the Indemnified Party may not settle any such claim or
action without the prior written consent of the Indemnifying Party, which
consent shall not be unreasonably withheld or delayed. If no settlement of such
claim or action is made, the Indemnifying Party (subject to the limitations
contained in Section 9.6) shall satisfy any judgment rendered with respect to
such claim or in such action, before the Indemnified Party is required to do so,
and pay all expenses, legal or otherwise, reasonably and necessarily incurred by
the Indemnified Party in the defense of such claim or Litigation.
(c) If a judgment is rendered against an Indemnified Party in any
action covered by the indemnification hereunder, or any lien in respect of such
judgment attaches to any of the assets of any of the an Indemnified Party, the
Indemnifying Party shall immediately upon such entry or attachment pay such
judgment in full or discharge such lien (subject to the limitation contained in
Section 9.6) unless, at the expense and direction of the Indemnifying Party, an
appeal is taken under which the execution of the judgment or satisfaction of the
lien is stayed. If and when a final judgment is rendered in any such action,
the Indemnifying Party shall forthwith pay such judgment or discharge such lien
(subject to the limitation in contained in Section 9.7) before the Indemnified
Party is compelled to do so.
9.5 Cooperation9.5@Cooperation. Notwithstanding anything to the
contrary contained in this Article 9, the parties shall cooperate with each
other to maximize the availability of insurance coverage for claims or actions
by third parties which may be subject to indemnification pursuant to this
Article 9, and if any insurance carrier for any party agrees to defend such
claim or action, such defense shall be tendered to such insurance carrier and
the rights of the parties between themselves regarding the assumption and
control of such defense shall be subject to the reasonable requirements of such
insurance carrier.
9.6 Limitation9.6@Limitation.
(a) The Sellers, Company and the original shareholders shall have no
obligation under this Article 9 to Buyer Indemnitees for (i) any Buyer
Indemnified Losses arising under Section 9.1 unless and until, and only to the
extent that, the total Buyer Indemnified Losses for which Sellers would
otherwise be liable equals or exceeds the limits provided by Buyer's current or
then existing Director's and Officer's Insurance Policies, provided however,
that such deductible shall not apply to any Buyer Indemnified Losses as a result
of a breach of the representations in Sections 4.2(b), 4.3(a), (b) or (d),
4.4(a), or 4.18(i), or resulting from fraudulent or intentional
misrepresentations under the Convertible Preferred Stock Purchase Agreements of
January 11, which losses shall be paid by the Company and original shareholders
to the extent they are liable therefore under the Convertible Preferred Stock
Purchase Agreement of January 11, 2002 for their full amount (i.e., from the
first dollar of loss). Sellers, the Company and the original shareholders
shall not be liable to the Buyer Indemnitees under this Article 9 for Buyer
Indemnified Losses in excess of the limits provided by Buyer's current or then
existing Director's and Officer's Insurance Policies, provided however, such
limitations shall not apply to any loss suffered by the Buyer Indemnitees
attributable to fraudulent or intentional misrepresentations or omissions in the
said Agreement of January 11, 2002.
(b) Buyer shall have no obligation under this Article 9 to
Shareholder Indemnitees for any Seller Indemnified Losses arising under Section
9.2 unless and until, and only to the extent that, the total Seller Indemnified
Losses for which Buyer would otherwise be liable equals or exceeds the limits
provided by Buyer's current or then existing Director's and Officer's Insurance
Policies, provided however, that such deductible shall not apply to any Seller
Indemnified Losses as a result of a breach of the representations in Sections
4.2(b), or 4.3(a), (b), (c), or (e), which losses shall be paid by Buyer
hereunder for their full amount (i.e., from the first dollar of loss). Anything
to the contrary notwithstanding, Buyer will be liable to Seller Indemnitees for
Seller Indemnified Losses arising under Section 9.2 only up to an aggregate
equal to the limits provided by Buyer's current or then existing Director's and
Officer's Insurance Policies provided however that such limitations shall not
apply to any loss suffered by the Seller Indemnitees attributable to fraudulent
or intentional misrepresentations or omissions.
9.7 Survival9.6@Survival. The representations, warranties, covenants,
agreements and indemnifications of the parties contained in this Agreement shall
survive any investigation heretofore or hereafter made by Buyer, Company or
Sellers and the consummation of the transactions contemplated herein and all
such representations and warranties shall be of no further force and effect
after twenty-four (24) months from the Closing Date ("Survival Period")
provided, however, that the Survival Period shall not apply to the
representations, warranties, covenants, agreements and indemnities set forth in
Sections 3.18 and 4.14 hereof. Anything to the contrary notwithstanding, a
claim for indemnification, which is made but not resolved prior to the
expiration of the Survival Period, may be pursued and resolved after such
expiration.
10. MISCELLANEOUS10.@MISCELLANEOUS
-------------
10.1 Notices10.1@Notices.
(a) All notices, demands or other communications required or permitted to be
given or made hereunder shall be in writing and delivered personally or sent by
pre-paid, first class, certified or registered mail, return receipt requested,
or overnight mail or Fedex to the intended recipient thereof at its address set
out below, and, if reasonably practicable, a copy via facsimile to the intended
recipient thereof at its facsimile number set out below. Any such invoice,
demand or communication shall be deemed to have been duly given upon receipt (if
given or made in person). In proving the same, it shall be sufficient to show
that the envelope was duly addressed, stamped and posted and delivered, and
whether or not delivery was accepted. The addresses of the parties for purposes
of this Agreement are:
(i) If to Buyer:
Greenland Corporation, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(ii) If to Sellers:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Ashford Capital, LLC
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
(b) Any party may change the address to which notices, requests, demands or
other communications shall be delivered or mailed by giving notice of the new
address to the other parties.
10.2 Counterparts10.2@Counterparts. This Agreement (including all
Company Transaction Documents and all Buyer Transaction Documents) may be
executed in any number of counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same instrument.
10.3 Entire Agreement10.3@Entire Agreement. This Agreement supersedes
all prior discussions and agreements between the parties with respect to the
subject matter hereof, and this Agreement contains the sole and entire agreement
among the parties with respect to the matters covered hereby. This Agreement
shall not be altered or amended except by an instrument in writing signed by or
on behalf of the party entitled to the benefit of the provision and against whom
enforcement is sought.
10.4 Termination of Shareholder Agreements10.3@Termination of
Shareholder Agreements. Execution by Sellers and Company of this Agreement
shall not be deemed to be a termination of any and all pre-existing agreements
with respect to the Capital Stock of Company by, between, or among any of them,
but the same shall continue in existence to permit the continuing rights and
assignments of rights therein as set forth hereinabove
10.5 Governing Law; Venue; Arbitration10.3@Governing Law. The validity
and effect of this Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of California, without regard to conflicts
of law. Any claim, demand, cause of action, proceeding, lawsuit, or action,
arising out of or relating to this Agreement any Exhibit hereto and, their
interpretation, performance, Closing or enforcement, shall be arbitrated before
a single Arbitrator under the Commercial Rules of the American Arbitration
Association in the County of Orange, and the parties consent to both subject
matter and personal jurisdiction therein or if the Arbitrator has no subject
matter jurisdiction, in the Superior Court of California in and to the County of
Orange. The parties shall initially be jointly responsible for the fees of the
Arbitrator and arbitration administrator, but the Arbitrator or court may award
reasonable fees and costs to the prevailing party or parties.
10.6 Successors and Assigns10.3@Successors and Assigns. This Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective heirs, executors, legal Representatives, successor and assigns.
10.7 Partial Invalidity and Severability10.3@Partial Invalidity and
Severability. All rights and restrictions contained herein may be exercised and
shall be applicable and binding only to the extent that they do not violate any
applicable Laws and are intended to be limited to the extent necessary to render
this Agreement legal, valid and enforceable. If any term of this Agreement, or
part thereof, not essential to the commercial purpose of this Agreement shall be
held to be illegal, invalid or unenforceable by a court of competent
jurisdiction, it is the intention of the parties that the remaining terms
hereof, or part thereof, shall constitute their agreement with respect to the
subject matter hereof and all such remaining terms, or parts thereof, shall
remain in full force and effect. The parties agree to replace any illegal,
invalid or unenforceable provision of this Agreement and execute an amendment to
this Agreement containing a valid provision, which will implement the commercial
purpose of the illegal, invalid or unenforceable provision.
10.8 Waiver10.3@Waiver. Any term or condition of this Agreement may be
waived at any time by the party, which is entitled to the benefit thereof, but
only if such waiver is evidenced by a writing signed by such party. No failure
on the part of any party hereto to exercise, and no delay in exercising any
right, power or remedy created hereunder, shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or remedy by any such
party preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. No waiver of, or consent to, any breach of or
default in any term or condition of this Agreement by any party hereto shall
constitute a waiver of or consent to any succeeding breach of or default in the
same or any other term or condition hereof.
10.9 Headings10.3@Headings. The headings of particular provisions of
this Agreement are inserted for convenience only and shall not be construed as a
part of this Agreement or serve as a limitation or expansion on the scope of any
term or provision of this Agreement.
10.10 Time of Performance10.3@Time of Performance. Time is of the
essence of this Agreement.
10.11 Enforcement of this Agreement10.3@Enforcement of this Agreement.
In any action or other proceeding brought by any party hereto to enforce the
provisions of this Agreement, the prevailing party, in addition to any other
relief as may be awarded thereunder shall be entitled to its costs, expenses and
reasonable attorneys' fees.
10.12. Pre-Existing Relationships: The parties acknowledge that Seller
ASHFORD CAPITAL, LLC, and its Managing Member ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ have a preexisting
relationship with all other parties herein, that the other parties have been
informed of the same and given an opportunity to inquire with respect thereto,
and the other parties have either approved the same or waived their objections
thereto. The parties further acknowledge that Sellers ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇
▇. ▇▇▇▇▇▇, a licensed California attorney, have a preexisting relationship with
each other and with other companies or organizations affiliated with each other,
that all parties have been informed of the same and given an opportunity to
inquire with respect thereto, and all parties have either approved the same or
waived their objections thereto. The parties further acknowledge that ▇▇. ▇▇▇▇▇▇
tendered a Conflicts Waiver to the other Sellers, the original shareholders, and
the Company, which was fully executed on or about December 19, 2001, which is
attached to the Convertible Preferred Stock Purchase Agreement of January 15,
2002 (Exh. "1.1 and 1.1A ") and which is to be deemed incorporated herein and
applicable to this transaction and agreements as well. By their execution of
this Agreement, the parties hereto acknowledge that they have either consulted
independent counsel with regard to this Agreement and the said Conflicts Waiver
or waive their right thereto, and they consent to the participation of ▇▇.
▇▇▇▇▇▇ in and under this Agreement and to his potential conflicts of interest
herein as a licensed California attorney
10.13 Management Fee: Buyer agrees that ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and/or his assigns
shall receive a management consulting fee equal to 1% of net sales of the
Company for a period of two years, provided that in payment of said fee shall
not place the Company in a negative cash flow condition; provided further that
said payment shall accrue to the extent it is not paid.
10.14. Board of Directors: The Board of the Company shall consist of:
▇▇▇▇▇▇ ▇▇▇▇▇▇ (Chairman); ▇▇▇▇▇▇ ▇ ▇▇▇▇, ▇▇.; ▇▇▇▇ ▇▇▇▇▇▇▇▇ and a person
selected by Ashford Capital.
10.15. Review of Counsel and Financial Advisors: Sellers, Buyer, and Company all
acknowledge that they have either consulted independent legal counsel and
financial advisors with respect to this Agreement and their rights hereunder, or
have waived their right to do so, and further acknowledge that they have been
advised to do so by ▇▇. ▇▇▇▇▇▇, a licensed California agttorney, pursuant to his
duties under the California Rules of Professional Conduct.
11. DEFINITIONS11.@DEFINITIONS
-----------
For purposes of this Agreement, the following terms shall have the meanings
specified with respect thereto below:
"Action" shall mean any action, suit, litigation, complaint, counterclaim,
claim, petition, mediation contest, or administrative proceeding, whether at
Law, in equity, in arbitration or otherwise, and whether conducted by or before
any Governmental Authority or other Person.
"Affiliate" means, as to any specified Person, any other Person that,
directly or indirectly through one or more intermediaries or otherwise,
controls, is controlled by, or is under common control with the specified
Person. As used in this definition, "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person (whether through ownership of Capital Stock of that Person,
by contract, or otherwise).
"Capital Lease" means a lease of (or other agreement conveying the right to
use) real or personal property that is required to be classified and accounted
for as a capital lease in accordance with GAAP as in effect on the date of this
Agreement.
"Capital Stock " means, with respect to (a) any corporation, any share, or
any depository receipt or other certificate representing any share, of an equity
ownership interest in that corporation, and (b) any other Entity, any share,
membership or other percentage interest, unit of participation, or other
equivalent (however designated) of an equity interest in that Entity.
"Charter Documents" means, with respect to any Entity at any time, in each
case as amended, modified, and supplemented at that time, the articles or
certificate of formation, incorporation, or organization (or the equivalent
organizational documents) of that Entity, (b) the bylaws, operating agreement,
trust indenture, or regulations (or the equivalent governing documents) of that
Entity, and (c) each document setting forth the designation, amount and relative
rights, limitations, and preferences of any class or series of that Entity's
Capital Stock or of any rights in respect of that Entity's Capital Stock .
"Damages" to any specified Person means any and all costs, damages and
expenses (including reasonable fees and actual disbursements by attorneys,
consultants, experts, or other Representatives, and Litigation costs) to, any
fine of or penalty on, or any Liability (including loss of earnings or profits)
obligations, fines, penalties, and Taxes of any other nature to that Person;
provided, however, that the amount of Damages shall be reduced appropriately for
tax benefits and insurance coverage, and shall not include indirect, incidental,
consequential, punitive, exemplary, lost opportunity, good will or special
damages of any nature, regardless of the nature of a party's claim or theory of
liability.
"Entity" or "Entities" means one or more sole proprietorships,
corporations, partnerships of any kind having a separate legal status, limited
liability companies, business trusts, unincorporated organizations or
associations, mutual companies, joint Stock companies, or joint ventures.
"Forum" shall mean any federal, national, state, local, municipal or
foreign court, governmental agency, administrative body or agency, tribunal,
private alternative dispute resolution system, or arbitration panel.
"GAAP" shall mean generally accepted accounting principles, consistently
applied.
"Governmental Approval" means at any time any authorization, consent,
approval, permit, franchise, certificate, license, implementing order, or
exemption of, or registration or filing with, any Governmental Authority,
including any certification or licensing of a natural person to engage in a
profession or trade or a specific regulated activity, at that time.
"Governmental Authority" means (a) any national, state, county, municipal,
or other government, domestic or foreign, or any agency, board, bureau,
commission, court, department, or other instrumentality of any such government,
and (b) any Person having the authority under any applicable Governmental
Requirement to assess and collect Taxes for its own account.
"Governmental Requirement" means at any time (a) any Law, rule, regulation,
judgment, decree, injunction, writ, edict, award, authorization or other
requirement of any Governmental Authority in effect at that time, and (b) any
obligation included in any certificate, certification, franchise, permit, or
license issued by any Governmental Authority or resulting from binding
arbitration, including any requirement under common law, at that time.
"Information" means all information, whether written or stored on computer
disks, tape(s), or electronically or optically stored, including without
limitation, (a) data, certificates, reports, files, records, agreements,
correspondence, plans, policies, practices, manuals, guides and statements, and
(b) summaries of unwritten agreements, arrangements, contracts, plans, policies,
programs, or practices or of unwritten amendments or modifications of,
supplements to, or waivers under any of the foregoing.
"IRC" shall mean the Internal Revenue Code of 1986, as amended.
"known," "to the knowledge of," "aware" or words of similar import employed
in this Agreement with reference to any individual or entity shall be
conclusively presumed to mean that the individual or entity has made reasonable
efforts under the circumstances to become knowledgeable; in the case of Company
and Buyer, "knowledge" shall be deemed to be the individual and collective
knowledge (as defined above) of its directors and senior officers and managers.
"Law" shall mean all federal, national, state, provincial, local, municipal
or foreign constitutions, statutes, rules, regulations, norms, ordinances, acts,
codes, legislation, treaties, conventions, common law principles, judicial
decisions and similar laws and legal requirements, whether of the United States
of America or any other jurisdiction as in effect from time to time.
"Liability" shall mean any liability or obligation whether known or
unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued,
liquidated or unliquidated and whether due or to become due.
"Liens" means, with respect to any property or asset of any Person (or any
revenues, income, or profits of that Person therefrom) (in each case whether the
same is consensual or nonconsensual or arises by contract, operation of Law,
legal process, or otherwise), (a) any mortgage, lien, security interest, pledge,
attachment, levy, or other adverse claim, charge or encumbrance of any kind
thereupon or in respect thereof or (b) any other arrangement under which the
same is transferred, sequestered, or otherwise identified with the intention of
subjecting the same to, or making the same available for, the payment or
performance of any Liability in priority to the payment of the ordinary,
unsecured creditors of that Person, including any "adverse claim") in the case
of any Capital Stock . For purposes of this Agreement, a Person shall be deemed
to own subject to a Lien any asset that it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease, or other title retention agreement relating to that asset.
"Litigation" means any Action, case, proceeding, claim, grievance, suit, or
investigation or other proceeding conducted by or pending before any
Governmental Authority or any arbitration or mediation proceeding.
"Orders" shall mean all applicable orders, writs, judgments, injunctions,
decrees, rulings, consent agreements, and awards of or by any Forum or entered
by consent of the party to be bound.
"Other Agreements" means the written agreements, documents, instruments,
and certificates executed pursuant to or in connection with this Agreement, all
as amended, modified, or supplemented from time to time.
"Person" means any natural person, Entity, estate, trust, union or employee
organization, or Governmental Authority.
"Representatives" means, with respect to any Person, the directors,
officers, employees, Affiliates, accountants (including independent certified
public accountants), advisors, attorneys, consultants, or other agents of that
Person, or any other Representatives of that Person or of any of those
directors, officers, employees, Affiliates, accountants (including independent
certified public accountants), advisors, attorneys, consultants or other agents.
"Taxes" shall mean any present or future taxes, levies, imposts, duties,
fees, assessments, deductions, withholdings or other charges of whatever nature,
including without limitation income, gross receipts, excise, property, sales,
use, customs, value added, consumption, transfer, license, payroll, employee
income, withholding, social security, and franchise taxes, now or hereafter
imposed or levied by the United States of America or any Governmental Authority
or by any department, agency or other political subdivision or taxing authority
thereof or therein, all deposits required in connection therewith, and all
interests, penalties, additions to tax, and other similar Liabilities with
respect thereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
BUYER:
GREENLAND CORPORATION
COMPANY:
W3M. INC
SELLERS:
(1) ASHFORD CAPITAL, LLC
(2) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(3) ▇▇▇▇ ▇. ▇▇▇▇▇▇
(4) REGENTS CAPITAL WEST
(5) MONDO ▇▇▇▇▇▇▇▇
(6) ▇▇▇▇ ▇▇▇▇▇▇
(7) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(Including Acknowledgment and Consent of Sellers' Spouses):
---------------------------------------------------------------
The spouses of Sellers join in the execution of this Stock Purchase Agreement to
evidence their knowledge of its existence and their consent to its provisions,
and that they desire to bind their interest, if any, in the Shares to the
performance of this Stock Purchase Agreement. Accordingly, each Sellers' spouse
agrees that the covenants made in this Stock Purchase Agreement will be, and
hereby are, accepted as binding on him/her individually and upon all persons
ever to claim under him/her. However, the foregoing is not intended to, and
will not be construed to, confer or create any interest in Sellers' Shares in
any Sellers' spouse.
